Milei clashes with Senate over pensions, vows to veto increase

President Javier Milei announced Friday he will veto pension increases approved by the Senate the previous day – the latest in a series of setbacks in Congress that covered the national budget and control of and funding for the state intelligence services.

“The veto will be complete, it will be total,” Milei said in an interview with the La Nación + news channel on Friday. 

He went on to accuse senators of being “fiscal degenerates.”

“The increase that derives from this law implies an increase in the cost in terms of GDP (Gross Domestic Product) of 1.2 percent,” Milei argued.

“Let them say how they are going to pay for it, because this is paid for with poverty, with less growth,” he argued. 

On Thursday evening, senators approved a bill to increase pensions by 8.1 percent to compensate for the loss of purchasing power seen in the first four months of Milei's term (December to March), when a devaluation and galloping inflation wiped out retirement benefits with cumulative inflation of almost 70 percent.

As the approval was won by a two-thirds majority of the chamber, even if Milei vetoes it, the Senate can reverse the veto with a new two-thirds vote.

From April onwards, Milei’s government provided increases that matched inflation. Since July, through a decree, pensions have been automatically updated in line with the general price increase index measured by the INDEC national statistics bureau. 

The minimum pension currently stands at 225,454 pesos (around US$233 at the official exchange rate), while a total basic basket of goods for an adult above the poverty line is 291,417 pesos (about US$301).

It has been a rough week for President Milei’s government in Congress. On Tuesday, the lower house Chamber of Deputies rejected a decree through which the government wanted to boost the “reserved funds” budget of the newly renamed SIDE state intelligence services by  100 billion pesos (US$103.5 million at the official exchange rate).

The government of Milei, who took office declaring that there was “no money” left to spend, did not indicate how the funds would be used, nor why they were needed,

Pushed by the opposition, the move to reject the decree even won the support of the majority (20 out of 37) of the right-wing PRO party chaired by former president Mauricio Macri (2015-2019), an ally of the government.

Milei said Friday that the extraordinary allocation for SIDE is necessary in order to prevent terrorist attacks.

“If a terrorist attack were to take place in Argentina, it is the absolute responsibility of this group of irresponsible people who take funding away from intelligence,” he said this week.

Local media outlets have previously reported that the funds were to be used to increase domestic espionage.

Another blow for Milei was the appointment in Congress on Tuesday of opposition Unión Cívica Radical Senator Martín Lousteau as president of the Permanent Bicameral Commission for the Oversight of Intelligence Agencies and Activities.

The ruling party was negotiating to appoint a lawmaker of its own, but Radical and Peronist deputies ended up supporting Lousteau, who has been the target of countless attacks on social networks by Milei and his followers.

– TIMES/AFP