Regulation on Minimum Pensions

DE No. 53/2004
DECRETO No. 53/2004
REGULATION ON MINIMUM PENSIONS Approval: 10/18/2004 Validity: 11/06/2004

DECRETO No. 53.

THE PRESIDENT OF THE REPUBLIC OF EL SALVADOR,

CONSIDERING:

I. That by Legislative Decree No. 927, dated December 20, 1996, published in Official Diary No. 243, Volume No. 333, of the 23rd of that same month and year, the Law of the Pension Savings System was issued, through which the Pension Savings System was created for workers in the private, public, and municipal sectors; in it, the requirements to access the benefits of the system are established;

II. That in accordance with Art. 146, final clause, of the aforementioned Law, it is necessary to issue a Regulation on Minimum Pensions that must contain the provisions to make such pensions effective.

THEREFORE,

in exercise of its constitutional powers,

DECREES the following:

REGULATION ON MINIMUM PENSIONS

TITLE I
GENERAL PROVISIONS

UNIQUE CHAPTER
OBJECT AND DESIGNATIONS

Art. 1.- The object of this Regulation is to establish the mechanisms that the Institutions of the Pension Savings System and the Public Pension System must follow to grant minimum pensions, according to the provisions contained in the Law of the Pension Savings System.

Art. 2.- In this Regulation, the following abbreviations and designations will be used:

AFP: Pension Fund Administrator Institution.
CIAP: Individual Pension Savings Account
IVM: Disability, Old Age and Death
ISSS: Salvadoran Social Security Institute
INPEP: National Institute of Pensions for Public Employees

DE No. 53/2004
DECRETO No. 53/2004
REGULATION ON MINIMUM PENSIONS Approval: 10/18/2004 Validity: 11/06/2004

Law: Law of the Pension Savings System
NUP: Unique Pension Number
SBR: Regulator Basic Salary
SAP: Pension Savings System
SPP: Public Pension System
Superintendence: Superintendence of Pensions
Budget Law: General State Budget Law
Pension Institutions: ISSS, INPEP and AFP
Ministry: Ministry of Finance

TITLE II
ON THE MINIMUM PENSION IN THE PENSION SAVINGS SYSTEM

CHAPTER I
ON REQUIREMENTS AND CONDITIONS

Art. 3.- The minimum pension will operate when the requirements established in articles 147, 148 and 149 of the Law are met, provided that the conditions established in article 146 and in the second and third clauses of article 148 of the same are met.

Art. 4.- The AFP must verify the condition of non-receipt of income referred to in article 146 of the Law, for those affiliates who meet the requirements to access the minimum pension, which will only proceed when the AFP determines that the affiliate's CIAP only reaches the financing of three months of full pensions.

The AFP must carry out this verification in accordance with the procedures indicated by the Superintendence through an instruction.

Art. 5.- When the affiliate or beneficiary meets the condition of non-receipt of income in the terms referred to in article 146 of the Law, they must present the "Minimum Pension Application" to the AFP in which they are affiliated, so that said AFP proceeds to make the request for the State Guarantee, according to what is established in the following chapter.

CHAPTER II
ON THE PROCEDURE TO REQUEST FUNDS FOR THE MINIMUM PENSION

Art. 6.- The AFP must send the minimum pension applications to the Ministry, sixty days before the last month in which the pension will be paid from the affiliate's CIAP.

The AFP must send along with the applications, a communication containing the date on which the balance of the affiliate's CIAP will be exhausted and that the income they receive, including the pension,

DE No. 53/2004
DECRETO No. 53/2004
REGULATION ON MINIMUM PENSIONS Approval: 10/18/2004 Validity: 11/06/2004

does not exceed the amount of the current minimum wage. The same criterion will apply to survivor pensions.

Art. 7.- Upon receipt of the documentation indicated in the previous article, the Ministry will transfer the corresponding resources to the AFP responsible for making the payment. Such fund transfer must be made no later than ten business days before the end of the month corresponding to the payment of the minimum pensions, through the current account of the fund administered and designated by the AFP for such purpose.

Art. 8.- The AFP must send the Ministry an acknowledgment of receipt, no later than two business days after receiving the credit note sent by the Ministry.

Art. 9.- The remaining balances reflected in the CIAP of the affiliate or beneficiary will serve as a complement to finance the first month of minimum pension that the affiliate or beneficiary receives.

CHAPTER III
ON THE ADMINISTRATION OF THE RESOURCES OF THE STATE GUARANTEE

Art. 10.- Each AFP must inform the Ministry, during the month of July of each fiscal year, about the annual estimates of the resources it will need for the financing of the State Guarantee. This report must include the estimated amount of minimum pensions to be granted, due to the exhaustion of the CIAP balance, during the following fiscal year.

Art. 11.- During the last five business days of each month, the AFP will request from the Ministry, the funds for the payment of all minimum pensions to be made in the following month. To do this, it must present a consolidated statement of the total amount required, which must reflect the changes generated by the granting of new pensions, expiration, redistribution, suspension or any change in the amount of the minimum pensions granted.

The Ministry, prior to notification by the AFP, will temporarily or permanently suspend the transfers of the minimum pensions to the current account designated for such effect, taking into account the causes referred to in the previous clause.

Art. 12.- The AFPs must report quarterly to the Ministry, on the use of the funds transferred for the payment of the minimum pensions, in order to reintegrate those financial resources not used nor committed, in accordance with article 111 of the Regulation of the Organic Law of Financial Administration of the State.

Art. 13.- When the AFP or the Ministry determine that funds were requested or transferred in excess, the AFP must reimburse them immediately to the Unique Current Account of the Public Treasury.

DE No. 53/2004
DECRETO No. 53/2004
REGULATION ON MINIMUM PENSIONS Approval: 10/18/2004 Validity: 11/06/2004

TITLE III

UNIQUE CHAPTER
ON THE MINIMUM PENSION IN THE PUBLIC PENSION SYSTEM

Art. 14.- The Pension Institutes, in order to verify the right to the minimum pension in accordance with what is prescribed in article 209 of the Law, must identify those disability and old age pensions that result lower than the amount of the current minimum pension.

If it concerns survivor pensions, the Pension Institute must verify that the sum of the pensions generated by the same claimant is not less than the minimum pension, regardless of whether the amount of the pension to which the claimant was entitled resulted lower or higher than said amount.

Art. 15.- For affiliates or beneficiaries whose pensions are lower than the current minimum pension, the Pension Institute will proceed to verify if they do not receive income that, including the pension, is equal to or higher than the current minimum wage. Likewise, if it is an old age pension, the Pension Institute must additionally verify if the affiliate has a minimum of twenty-five years of contributions.

The income verification referred to in the previous clause must be carried out in accordance with what is established in the instruction issued for such purpose.

Art. 16.- To the affiliates or their beneficiaries who, according to articles 14 and 15 of this Regulation, are determined to meet the requirements and conditions for the enjoyment of the State Guarantee, the Pension Institute must adjust their pension to the amount of the corresponding minimum pension.

Art. 17.- The adjustment to the survivor minimum pension will consist of redistributing, proportionally, the difference between the sum of the pensions and the amount of the minimum pension assigned to each beneficiary, until reaching 100% of said minimum pension.

Art. 18.- The provisions indicated in this Regulation are applicable to pensions granted under the laws of ISSS and INPEP, before the entry into operation of the SAP; as well as to pensions that are granted based on the latter, provided that they are adjusted to the minimum pension.

TITLE IV

UNIQUE CHAPTER
PROOF OF SURVIVAL

Art. 19.- The AFP must verify the survival condition of the pensioner, through the mechanisms defined by the Superintendence for such purposes; said verification must be carried out each year in the same month in which the minimum pension was granted. Pensioners in the Pension Institutes must prove the survival condition, in accordance with what is established in the Regulation of Benefits and Other Benefits of the Public Pension System.

TITLE V

UNIQUE CHAPTER
FINAL PROVISIONS

Art. 20.- The Superintendence, based on the letters i) of article 5 and b) of article 6 of its Organic Law, will audit and supervise the pensions assigned and the management processes of the financial resources that the State transfers to comply with the State Guarantee of Minimum Pension.

Art. 21.- The Superintendence, based on the powers established in the letter k) of article 5 of its Organic Law, will impose the corresponding sanctions and precautionary measures, in accordance with the procedures established in the aforementioned Law and in the Law of the Pension Savings System, when it detects from any of the Pension Institutions contraventions to the regulations related to the payment of minimum pensions.

Art. 22.- The revaluation of pensions referred to in article 210 of the Law will be applicable to the minimum pensions granted by the SPP, provided that at the date when the revaluation is applied, such benefits have already been legally granted and notified to the interested parties.

Art. 23.- In case the pensioner dies and there are survivors, the AFP or the Pension Institute must carry out pension readjustments among the other survivors in accordance with the applicable regulations.

Art. 24.- The minimum pension will be suspended when it is proven that the affiliate receives income higher than the current minimum wage, but it will resume when this condition disappears.

Art. 25.- The AFPs or the Pension Institutes must issue a resolution when a suspension of the State Guarantee is made to a pensioner, reasoning the motives for doing so.

Art. 26.- Any aspect not contemplated in this Regulation will be resolved by the Superintendence of Pensions in accordance with the Law.

Art. 27.- The Regulation of Benefits and other Benefits of the Public Pension System is repealed, in Title III, only its Chapter I.

DE No. 53/2004
DECRETO No. 53/2004
REGULATION ON MINIMUM PENSIONS Approval: 10/18/2004 Validity: 11/06/2004

Art. 28.- This Decree will enter into force eight days after its publication in the Official Diary.

GIVEN IN THE PRESIDENTIAL HOUSE: San Salvador, on the eighteenth day of the month of October of the year two thousand four.

ELIAS ANTONIO SACA GONZALEZ,
PRESIDENT OF THE REPUBLIC.

JOSE GUILLERMO BELARMINO LOPEZ SUAREZ,
MINISTER OF FINANCE.

JOSE ROBERTO ESPINAL ESCOBAR,
MINISTER OF LABOR AND SOCIAL PREVISION.

Decree No. 53, of 10/18/2004
Published in Official Diary No. 203, Volume No. 365, of October 29, 2004 This compilation is an exact copy of what is established in the Official Diary.