Mexican Senate modified the Law that regulates the private pension system

In order to protect worker’s savings on private pension system, yesterday the Mexican senators approved some reforms that allow the surveillance institution of the system (CONSAR) to take important measures. CONSAR will be able to evaluate the level of fees pension fund managers charge, order a reduction in the fess and even to fix them if managers ignore CONSAR recommendations. Also the reform force managers to calculate (according to worker’s information: salary, contributions, etc.) at the beginning of the year the amount that will be charged from fees and inform the result to each affiliated worker. As we mentioned in a previous note, fees en Mexico are still very high, in comparison to international standards. Finally, when pension funds register losses, as is happening nowadays, managers must inform CONSAR, who in turn will evaluate whether investment scheme must be modified in order to assure best conditions for workers. This reform must be approved by the Congress.