SANTIAGO, Dec 3 (Reuters) - Chilean lawmakers on Thursday
approved a second withdrawal from pension funds for citizens
struggling to make ends meet during the coronavirus pandemic.
The bill, which now goes to a final Senate vote due to take
place on Thursday evening, would allow for another 10%
withdrawal from Chile's privately managed pension funds.
It was approved by 131 lawmakers in the opposition-dominated
lower house of Congress, with 12 voting against and two
The bill was introduced by conservative President Sebastian
Pinera's government two weeks ago to head off a more
comprehensive proposal by opposition lawmakers and won early
approval in the Senate last week.
But it has been significantly amended in congressional
committees to remove a cap on who was eligible to benefit and
the obligation that the money be repaid, effectively removing
the differences between the bills.
The government has argued against any withdrawals, saying
they would reduce already low pension payouts and that citizens
should rely on the government's emergency coronavirus measures
instead, which include spot payments and rent subsidies.
A first move on pensions was approved, however, with
cross-party support in July, with its impact on markets more
limited than originally feared and giving the economy a bounce
as people spent some of the $17.4 billion withdrawn.
The government also opposed a second withdrawal floated by
the opposition. But after it became apparent that members of the
ruling Chile Vamos coalition would help the initiative over the
line again, the government was forced to do a U-turn and
introduced its own bill.
Those backing the pension withdrawals argue the state
provisions do not go far enough. Chile's unemployment figures
remain near a decade-long high. A poll by Ipsos released on
Thursday found that 53% of respondents reported a drop in their
incomes, while a third said their debt levels had increased.
Economic activity fell by 1.2% in October, disappointing the
market, which had expected some revival by then.
The government warned this week of a possible second spike
of the virus to come in January, ahead of the arrival of a
(Reporting by Aislinn Laing; Editing by Peter Cooney)