Foundation Sol: Poverty in Chile Could Soar Without State Support Like the PGU

Original article: Fundación Sol: Pobreza en Chile sería mucho mayor si se eliminaran aportes estatales como la PGU

In a discussion with Radio U. de Chile, Gonzalo Durán, a researcher at Fundación Sol, pointed out that poverty in Chile «could be much higher than we think» if state contributions, such as the PGU (Guaranteed Universal Pension), were eliminated or if we only considered self-generated income.

«In this same Casen survey, when we look at, for instance, what happens to work income—how much Chileans earn? The survey indicates that half earn less than $630,000 in net earnings from work, which is obviously quite insufficient given the cost of living in our country,» the expert stated.

According to Gonzalo Durán, «this Casen survey confirms two fundamental crises for Chilean society: the crisis of low wages and the pension crisis.»

«The Casen survey tends to ‘mask’ poverty, so to speak, through the PGU. The reported poverty rate was 17.3%, which is already quite high: 3.5 million people living in poverty. But if we exclude the PGU from that indicator, poverty rises to 22%,» he explained.

«If we take it a step further and calculate poverty based solely on self-generated income, which includes earnings from work and pensions that one generates for oneself, poverty would actually rise to 25%. That’s eight percentage points higher than the official figure, and it should deeply concern us,» added the Fundación Sol researcher.

Collective Bargaining is Essential

Thus, the diagnosis that «was already clear before is now confirmed, and a fundamental issue for reversing or transforming this reality (…) what comparative evidence tells us is that collective bargaining is essential,» Durán stated.

He emphasized, «because it pertains to how unions negotiate with employers for better working conditions and also improved salary conditions collectively, not through individual contracts that we know are never negotiated.»

«The crisis of low wages and insufficient pensions reveals an urgent reality: we need to strengthen collective bargaining to transform living conditions in the country,» the expert insisted.

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