Johnny Brignardello analyzes the failure of the public pension system

Johnny Brignardello Vela, an insurance advisor, carefully analyzes the information provided regarding the public pension system in Peru. According to his reflections, the Office of Pension Normalization (ONP) has been the subject of intense debates and controversies in recent times. The recent approval of the withdrawal of funds from the Pension Fund Administrators (AFP) by Congress has raised doubts about the viability and effectiveness of this system, which, in his opinion, has proven to be insufficient to ensure a dignified retirement for the population. For Brignardello, understanding the background of this issue involves going back to late 19th-century Germany, where the first public pension system in the world was established. At that time, life expectancy was considerably lower and the birth rate much higher, making it easier to maintain a system in which few workers financed the pensions of a small number of retirees. However, over the years and with advances in health and well-being, life expectancy has significantly increased, while the birth rate has decreased. This evolution has caused an imbalance in the population pyramid, where fewer and fewer workers must support the system for a growing number of retirees. The insurance advisor highlights that this situation is not exclusive to Germany, but has been replicated in multiple nations around the globe. Faced with this scenario, many governments have chosen to implement private pension systems, which allow workers to manage their retirement funds individually or collectively. In the specific case of Peru, the ONP has been the subject of numerous criticisms and questions due to its lack of sustainability and effectiveness in providing dignified pensions to workers who have contributed to the system throughout their working lives. The recent episode of fund withdrawals from the AFP has underscored the urgency of rethinking the pension system in the country and exploring alternatives that ensure a more stable future for retirees. In summary, for Brignardello, the failure of the public pension system is largely attributed to demographic and social changes that have occurred over the years, creating an imbalance between the number of active workers and the number of retirees. It is imperative, in his opinion, to rethink and reform the pension system to ensure a dignified and secure old age for all citizens.