Experts propose new debt instruments to supplement pension

O objective is to have “more savings allocation instruments” substitutes for deposits, such as savings certificates or Treasury certificates, and the biggest difference that this instrument combines a accumulation phase with a reimbursement phase in the form of monthly temporary income, explained the coordinator of the working group today, in Lisbon.

In this way, Jorge Bravo indicated in the presentation of the report, in the accumulation phase it is constituting savings, “i.e. by subscribing more certificates or buying more bonds from the treasure”.

At the next stage, “as opposed to what is happening today with these instruments in which withdrawal is in the form of single capital”, in this case, the instrument has a reimbursement phase in the form of an income supplement for a given period of time, such as a temporary income with an undefined duration.

This made it possible to “diversify and strengthen the Republic’s funding base”.

The working party argues that the interest rate of this instrument should be indexed to the cost of living.

“ It would be an interest rate indexed to the CPI [Consumer Price Index] and, eventually, with one more spread [juro] on top of that CPI”.

Another of the suggested measures is the “Save As You Buy” program or savings through consumption. The idea of this program is to take advantage of consumer habits to save, for example through invoices with tax identification number (NIF).

The architecture is based on a savings-consumer account, which “is only a form of registration of these small mechanisms, which would then be channelled into supervised financial products, which are those that the worker must then choose,” Jorge Bravo detailed.