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LatinNews Daily - 06 February 2026
In brief: Public sector pension reform clears Paraguay’s lower chamber
*Paraguay’s lower chamber of deputies has approved a reform to the public sector pension law, known as the ‘caja fiscal’ (fiscal fund), amid protests from workers’ unions. Among other things, the reform raises the retirement age for public sector workers to 57, with a minimum of 25 years of contributions. Early retirement can be taken at 55 with a minimum of 30 years of contributions. The administration of President Santiago Peña argues that the reform is needed given that the deficit in the fiscal fund reached US$380m at the end of 2025. Under the reform, the employer or state contribution will be 5%, up from 3% in the original reform proposed by Peña. Employees in sectors with a surplus will contribute 16% while those with a deficit (teachers and public security forces) will contribute 19%. The same day, the lower chamber also approved a reform to the parliamentary pension law, raising the minimum retirement age to 60. The reforms will now go to the senate for a vote.
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- In brief: Public sector pension reform clears Paraguay’s lower chamber