Bill 163.

Summary.

The bill amends the glossary in Law 51 of 2005. It defines enrollment, insured persons, beneficiaries and contributors, individual and personal savings accounts, Solidarity Capitalization and contributions. It adds definitions of the Universal Basic Pension, Solidarity Benefit Pension and Guaranteed Solidarity Pension, as well as the Single Solidarity Fund and the Composite System. It also specifies categories of workers, wages, fees, benefits, risks and procurement documents. It distinguishes regulations issued by the Board of Directors from normative resolutions and organizational procedures issued by the Director General. Regulatory acts and acts of general effect issued by the Board would apply from their publication in the Official Gazette unless they set a later date.

The proposal assigns the Social Security Fund responsibility for administering, planning and overseeing covered contingencies. It describes the Fund as an autonomous public entity with its own assets and lists benefits associated with old age, illness, maternity, disability, family support, survivors, funerals and occupational risks. It provides for funds to be kept separate from those of the Central Government, approval of its draft budget and personnel management under the stated rules. Its governing bodies would apply governance standards. Coverage for involuntary unemployment would depend on verification of actuarial conditions and financial projections sufficient to fund it.

The text establishes the values of honesty, commitment, reliability, cooperation and respect. Its principles cover essential public service, solidarity, universality, mandatory participation, sustainability, transparency, dedicated use of resources, efficiency, subsidiarity and the contributory basis of benefits. It prohibits interruption of services to the detriment of insured persons and dependants, and use of social security resources for unrelated purposes. Enrollment of employees and registration of employers would be mandatory; enrollment of self employed workers would follow the bill’s provisions. The text describes the scope of protection in the Republic of Panama.

The Social Security Fund would retain national tax exemptions, subject to exceptions for its obligations as an employer, and the procedural protections set out in the Judicial Code. Financial liability determined by the Accounts Jurisdiction would be enforced through compulsory collection after the Court of Accounts sends its decision to the Fund; the result would be reported to the originating tribunal. The Fund could collect contributions and other sums, fines, surcharges and interest through that procedure, along with specified financial liabilities and losses. The Director General would have to initiate it when the stated arrears reach three months or more. For mortgage loans, the agreed period for enforcing the security would apply.

For oversight, the Fund could access databases, inspect workplaces and examine books, payroll records and other documents to verify contributions and occupational health obligations. Persons covered by the system would have to provide information and facilitate inspections; refusal would be sanctioned under the Law. The Ministry of Labor and Workforce Development (Ministerio de Trabajo y Desarrollo Laboral), the National Migration Service of the Ministry of Public Security (Servicio Nacional de Migración del Ministerio de Seguridad Pública) and other competent bodies would notify one another of possible breaches found during investigations. The Fund could also review payroll returns and payment methods and obtain information on employers’ and self employed workers’ income and identity from the Ministry of Economy and Finance (Ministerio de Economía y Finanzas).

The bill exceptionally allows arrears to be paid in part with goods needed by the institution or securities that meet the stated conditions, subject to Board approval. It requires prior endorsement by the Office of the Comptroller General of the Republic (Contraloría General de la República). Securities would also require a favorable assessment by the Technical Investment Unit (Unidad Técnica de Inversiones) and quotation on an exchange recognized by the Securities Market Superintendency (Superintendencia del Mercado de Valores). It gives priority to claims for social security contributions, subject to the stated exceptions for security interests in specific property and workers’ employment benefits. It authorizes fees for administrative services and exempts services requested by insured persons.

The proposal also provides for the collection and remittance of national taxes withheld by employers, regulates the confidentiality and sharing of institutional information, and calls for digital social security and health systems. Improper disclosure of information by a Fund employee would result in dismissal. Actions to collect the specified obligations would be subject to a twenty-year limitation period calculated from the stated starting points. The text defines the functions of the Board and Director General, changes the appointment of a public servants’ representative by the Executive Branch and sets out qualifications for Board membership. These provisions could concern insured persons, pensioners, employers, self employed workers and sectors employing staff, as well as the Ministry of Health (Ministerio de Salud), the Public Prosecutor’s Office (Ministerio Público) and the Directorate General of Revenue (Dirección General de Ingresos).