On Friday, the CEOECepyme and ATA business groups voiced a united stance against the government’s pension reform plan, describing it as a policy that imposes an excessive burden on workers and firms. They argue that the reform would increase contributions across the board and appear to tilt the balance away from sustainable wage growth, potentially diminishing hiring momentum as labor costs rise.
In a statement accompanying their critical assessment, executives warned that any pension changes should be evaluated for their impact on employment and competitiveness. They contend that the proposed framework shifts too much responsibility onto workers and employers alike, risking slower wage progression and a squeeze on job creation. The groups stressed that a thorough, transparent appraisal is essential before any approval vote proceeds.
Pension reform pressures employers to improve benefits
While acknowledging the need to scrutinize the government’s document presented at today’s consultation, the business associations labeled the proposal as deeply reactionary. They argue it extends required work years, increases pension contributions, and, in their view, does not deliver corresponding benefits to retirees. The reform, they say, would fail to balance future needs with the realities faced by workers today.
According to the chambers, the government’s approach bypasses the social dialogue that has historically guided pension policy. They note that discussions did not occur within the framework of the Toledo Pact and allege that the reform lacks the comprehensive impact analysis that social partners have been seeking since mid-year. This absence of dialogue, they claim, undermines trust and policy soundness.
A “populist voracious compilation” proposal
Entrepreneurs contend the government’s plan was distributed to stakeholders only after it appeared in the press, and not in advance for constructive feedback. They describe the timing as emblematic of a broader pattern: months of limited engagement from the Ministry and a push to move forward without meaningful consultation. In their view, the process reflects a fiscal appetite for revenue rather than a balanced, long-term reform strategy.
The groups warn that what they call government greed—driven by populist tax ideas—could impede wage negotiations by increasing the cost burdens on businesses. If payroll contributions rise, a portion of higher wages could be offset by the higher taxes, leaving workers with smaller net gains. The concern is that employers will have less room to reward productivity and performance with genuine wage growth.
Beyond the immediate financing effects, employers warn that small businesses and self-employed workers would bear a disproportionate share of the reforms. They emphasize that many smaller enterprises operate with tighter margins and lower capital buffers, so any rise in costs could threaten viability, reduce hiring, and hamper local economic vitality. The risk is a slower pace of job creation and fewer opportunities for new entrants in the market.
Supporters of the reform argue the changes are necessary to secure pension solvency and ensure retirement benefits for future generations. Yet the business community insists that any overhaul must include broad social dialogue, clear impact assessments, and phased implementation to minimize disruption. They advocate a balanced approach that aligns fiscal sustainability with fair compensation and ongoing opportunity in the labor market.
In the broader Canadian and U.S. context, leaders on both sides of the political spectrum recognize the challenge of designing pension policies that are fair today while remaining financially sustainable tomorrow. The current discussion underscores the need for transparent analysis, stakeholder engagement, and careful timing to avoid unintended consequences for workers and employers alike. (Citation: Government policy brief on pension reform)