PROCESO 803
22 ABRIL 1998
Editorial
Economy
Social security and the private pension system
Public Opinion
Salvadorans express their opinion of the education and health systems (part II)
During the course of the last week the resignations of four executive editors of LA PRENSA GRAFICA were made public. According to the information concerning this event, presented on the pages of that daily, the dissenting executives had petitioned the newspaper's board of directors on two issues: the re-establishment of editorial independence and the provision of effective leadership for the newspaper. The first request was apparently granted; the second was not--which led to the presentation of the resignations of the Editor-in-Chief, Mr. Flavio Villacorta; the Head of Information Services, Mr. Ricardo Chacón; and two Assistant Heads of Information Services, Messrs. Luis López Portillo y Ernest Vázquez.
Beyond these few crumbs of news, little is known of the internal situation in LA PRENSA GRAFICA. Before the eruption of this crisis, rumors had filtered out concerning supposed differences among the members of the Dutriz family concerning the orientation of the newspaper during this post-war period. There had even been those who saw, in the column inches awarded to figures such as Mr. Salvador Samayoa, indications of a change toward moderation and tolerance in the newspaper's policies. Finally, said the most optimistic among its readers, one of the most powerful journalistic enterprises in the country had shown an inclination towards contributing seriously to the process of the democratization of the country, and this they did with profundity--opening the pages of their opinion columns to personalities who, in years past, were unable to relate to each other except in terms of reciprocal extermination.
This was the image that LA PRENSA GRAFICA was attempting to carve out. But, obviously, there was much--or, perhaps, too much--image alone. In the difficult confluence of events through which El Salvador has passed since 1992--especially in situations when demobilized forces took the streets, or workers of the Ministry of Public Works occupied the Cathedral of San Salvador--the newspaper did not hesitate to assume the stance of the government perspective on the events, in spite of the undoubted anti-democratic characteristics of that stance. Here is to be seen the ambiguity of the newspaper; here the daily's inability to take a clear position when faced with national problems is demonstrated.
The editors who resign now demonstrate, in this way, their malaise with what they perceive as the "commercializing spirit" to which the daily has succumbed. It will certainly not escape notice that this is the same criticism which Alfredo Mena Lagos and Orlando de Sola lay at the door of the Cristiani group. Could it be that the financial sector's interests are influencing the march of the PRENSA GRAFICA? Or is it a matter of malaise caused by the perception of the almost absolute submission of the newspaper to the buyers of commercial advertisements and the publicity agents? Responses to these questions are not immediately apparent; nor is the resolution to these questions amenable to one response which excludes all others. For the moment, then, only those actually involved in the conflict know exactly what hangs in the balance in this matter of the resignations of the editor-in-chief and head and assistant heads of information.
One item is not open to discussion: the image of LA PRENSA GRAFICA as news media committed to a project for democratization which began to blur much before this last crisis. Evident and palpable, too, were the following factors: the lack of a clear journalistic project, editorial commitments to the ARENA government, the lack of leadership, the newspaper's submission to the rule of publicity. What is strange about all of this is that it was not until this moment that those who participated in a substantive way in the commission of these ills (it is not known if they did so, consenting or expressing reservations) thought to lament it all and make of it sufficient motive to abandon an enterprise which could not have become what it is without their offerings and support, limited as these may have been.
Certainly any journalistic enterprise whose central focus is the work of providing information would be ruined by such an exit en masse of the intermediate levels of its editors and information. But this is not the case of THE PRENSA GRAFICA, the lion's share of whose pages are covered with announcements and publicity. Submerged in this dynamic, the newspaper will survive with or without formally established editorial and information teams.
Meanwhile, EL DIARIO DE HOY seems to be immersed in a difficult transition, but even more far-reaching than the transition to which LA PRENSA GRAFICA aimed at. Without ceasing to be a newspaper with a conservative identity--to say that it is one which identifies with the right becomes more and more problematic--it is seriously taking up the challenge of making rigorous journalistic work the central focus of its daily work.
The ideological bias is inevitable but legitimate, when the bias is assumed clearly and without ambiguities. Even so, such a bias is legitimate and even laudable when it recognizes that the rest also have the right to defend their own ideological biases. The problem, then, is not the defense of right-wing (conservative) values; the problem arises when those values are made absolute and, under that banner, proceed to provide a basis for the extermination of those who proclaim different values.
There was a time when EL DIARIO DE HOY was totally dominated by precisely that perverse logic. For some time now, the newspaper has shown signs of beginning to break with that logic, although without being totally committed to that sane proposition, as demonstrated, for example, in its news report on the events of April 19 in the town of Ataco, when the townspeople of Ataco, accompanied by FMLN Deputy, Humberto Centeno, demonstrated against the National Administration of Aqueducts and Sewers (ANDA). These are the headlines from the April 20 edition of that newspaper: "Incitement to violence against ANDA" and "Townspeople incited to act against ANDA in Ataco". The footnotes read: "as in the worst years of subversive activity, several leftist militants called on the people yesterday to act against their [public utility] institutions..."
The brief informative news article, nevertheless, is news dominated less by an effort to provide ample coverage of the events than by the open and expressed intention to discredit the FMLN, leading the readers to see the actions of that left party as "subversive" actions (in the old use of the term) and as manipulators of "the masses". Of course, those who work for EL DIARIO DE HOY could be against the FMLN, and for this the newspaper has an editorial column, where evaluations and ideological positions can be expressed. Are the owners of that morning daily willing to carry out, to their final consequences, the separation between professional journalistic work and their editorial line or are they going to continue to darken the efforts of the first with the partiality proper to the second?
In the difficult challenge of changing the written press in such a way that it is in harmony with the democratic order under construction, the boards of directors of EL DIARIO DE HOY and LA PRENSA GRAFICA have confronted and are confronting problems not only of what constitutes professional journalistic work, but in the relationships of this work with the ideological committments of the owners. How will these problems be resolved? One cannot know for sure, but what is undoubtedly true is that the solution depends on whether the written press will continue in the same tenor as always or if it will transform itself so that its reporting will be more consonant with the country's rhythms of change.
The two central points around which the Salvadoran press must revolve if it wishes to produce its reporting in such a way as to be synchronized with the country's process of democratization; these are: a defined ideological identity together with rigorous and objective journalistic work independent of that ideology. Both of these stances ought to be assumed seriously and responsibly, because only in this way can the written press come to merit the respect of the actors in Salvadoran society. It is not sufficient for one newspaper or the other to proclaim itself champion of democracy; it is not enough to recruit people linked in the past to political groups, with which one does not sympathize, as reporters and editors. What is at stake is the commitment to democracy expressed in the highest quality of journalistic work, work not bound by the political and ideological commitments of the owners of the paper or who bend under the pressures of the businessmen who pay for the publicity. The idea is that those who have presumibly won a space in which to express ideas and propositions which are truly different from official ideas and propositions should actually go about doing this and not simply dedicate themselves to currying favor in an acritical way with the government and private enterprise because, that way, all they are doing is creating a tissue of fiction which can be paraded about as passing for pluralism and tolerance.
More for ill than for good, since the signing of the Peace Accords, the principle institutionalized expressions of power in El Salvador have been placed under the critical magnifying glass of public scrutiny. With the communications media--especially the written press--such a thing has not yet happened. Perhaps the hour has come in which the national newspapers must begin a process of internal discussion about their past, present and future. The situation of LA PRENSA GRAFICA--even with the little that is known of it at this point--must surely oblige it to accept responsibility for the problem of the news media in a society undergoing a process of democratizing itself.
The formal initiation of the new system of savings and pensions began on April 16 of this year. The implementation of this system means the transference of the administration of employee payments from the state to private enterprise--specifically to five Pension Fund Administrators (AFP) created in an ad hoc manner. This has given rise to a considerable number of polemics, which have, in turn, served to open up the possibility for reforming the Law [to create] the System of Savings for Pensions and even for the possibility for the abrogation of that law. The principal benefits which the government attributes to the new system are an increase in savings, investment and employment; the broadening of coverage to include the informal sector; the increase in the profit generating potential of the funds and in the amount of the pensions. This last benefit is not, however, so immediately available. The criterion expressed by Leonardo Jorquera, Director of the AFP Porvenir of El Salvador and Manager of the AFP Provida of Chile, is that, in order achieve significant increases in the amount of pensions, it will be necessary to wait between 30 and 40 years after the implementation of the reform.
The most notorious problems confronting the social security system in El Salvador are: the low client coverage offered by the system, social costs, high administrative costs, lack of equality in client coverage, low availability of profits to be derived from the funds and the low profile of the state role in the social security benefits. The present system offers coverage for only a little more than 17% of the Economically Active Population (PEA) of the country, which implies that more than 82% of the PEA has no social security coverage of any kind.
On the other hand, social costs are generated when the quotas paid by the business sector are passed on to consumers in the form of prices. In this way, the costs of social security are only 17% of the PEA are paid by all of society. On the other hand, according to some studies, the costs of social security are almost 20% of the total of the quota payments received by employers and workers.
The inequality of the system's coverage is evident if we consider that the coverage does not provide social security to the agricultural and livestock workers nor to the informal sector, precisely the sectors where poverty is concentrated and where the lack of satisfaction of basic needs is greatest. Additionally, the existence of maximum limits for the levels of labor quotas implies that those who earn more pay proportionally less than the sectors with lesser income.
Another question with regard to the current system of pensions arises from the low level of profit derived from the funds of the pension system, given that these are not placed in financial operations which would generate the maximum profit possible; a case in point, the investment in title shares does not general any profit at all for the workers.
The role of the state in social security is also questionable, because the state has not offered any significant support for social security. The employer and worker sectors are those who have paid the principal costs of social security.
The new proposal for the pension system deals with some of the most pressing problems, and some of the results of this proposal would be: increase in coverage, elimination of problems of equality derived from the existence of maximum limits in quota payments and, finally, increase in the profit-generating capacity of the funds. This would succeed by individualizing the accounts of the workers in such a way that each of them would receive only what he or she pays in, establishing fixed percentages, without limits, in order to calculate the total payments of these accounts.
It is worth noting that, although the proposal is that the new pension system would increase coverage, it would be doubtful because it is based on the supposed incorporation of the informal sector into the pension system. The informal sector is characterized by lower income, even income below the relative poverty line; it is, therefore, difficult to assume that the workers will give up 6% of their income in order to participate in a pension plan. Supposing that they do so, major coverage of the benefit system would be obtained at a cost of increasing relative poverty at the present time.
Other problems related to the socialization of costs and the exclusion of the agricultural and livestock sectors have been brought to light through the reform of the pension system; but perhaps the most outstanding aspect of the reform are its implications concerning administrative costs. If, earlier, it was estimated that close to 20% of the pension funds were destined to cover administrative costs, the situation posed at the present time will not imply any improvement.
On the contrary, by fixing a rate of between 2.7% and 3.5% for the AFP commissions, what will happen is that the costs for the functioning of the private system of pensions would consist in amounts over and above the administrative costs of the state system. For this reason, in the first year of operation of the new pension system, of the total payments turned over to the AFP, between 33.8% and 43.8% would be earmarked as AFP commissions, which, in practice, would constitute an administrative cost charged to the worker.
Over and above the defects exhibited by the state system, it is important to consider what will be the effects of the new pension system on the quotas paid by the employers and employees. At first, the increase in pensions will imply an increase of 300% for workers, as their quotas are raised for the benefit system from 1.5% to 4.5%, with the aggravating factor that the greater part of the quota (78%) will be lost in commissions for the AFP. By the year 2002, the total amount of workers' quotas will come to represent more than 410% of the current volume of quotas.
The proposal to reform the pension system would have clear negative effects on the disposable income of the workers, without which the total income lost will be deposited in individual accounts. During the first years, close to 80% of the worker quota will turn out to be patrimony of the AFP, while for the year 2002 it is hoped that the same percentage will grow to 46%.
On the other hand, the employer sector will benefit through an important reduction of its quota which would move, at first, from 7.0% to 4.5%, and then increase up to 6.75% by the year 2002. In the final analysis, the employer sector will end up paying less that it currently pays.
Another problem that ought to be clarified is the relation between the effects on pensions, because no guarantee exists that pensions will substantially increase. Not even in the Chilean case, where, with more than 15 years of functioning, the private pension system exhibits an improvement in the total amount of pensions.
The reform of the pension system proposed by the ARENA government exhibits a bias against the worker sector because it obliges the workers to spend a greater percentage of their salaries on pension savings and, moreover, adds a payment for commissions which represent more than double what they are paying currently. Those who will derive the greatest benefit under the new system will be the employers, who will actually see the quotas they pay; the same will be true for managers of the AFP, who will receive higher levels of profits at the expense of the salaries of working people.
It is impossible to deny that the system of social security has great faults and weaknesses, but at the same time, it cannot be denied that the new system does not offer a short-term or medium-term solution to the principle problems which plague the state pension program. Hence, the need to review the proposal for reform and adjust it more towards the interests of the working people and less towards the interests of private enterprise.
In our continuing report on the results of the opinion poll conducted by the University Institute on Public Opinion in November of last year on the topics of education and health, we present, on this occasion, some of the most relevant data revealing the vision held by Salvadoran citizens of their health system, a sphere of interest in national life which has been very much present recently in the news media and which has given rise to much public debate, given the Social Security doctors' strike and certain news items presented in the press in recent weeks.
As with the polling of public opinion on the national educational system, the poll on the health system asked citizen opinion about government interest in health problems confronting the country. On this topic, the population has a more critical image of the government as compared with the educational area, although it is not possible to say that, in general, the vision expressed by those polled is negative. Some 45.6% thought that the government has little or no interest in education, whereas 49.9% hold the opinion that the government has some to much interest in health problems and 4.5% did not respond.
Those interviewed were asked to identify the principal problem which, in their judgment, confronted the health system in El Salvador. The most frequent responses were: the high cost of services (31%); lack of medicine (23.2%); lack of hospitals and clinics (17.7%); ill-prepared doctors (10.8%) and the fact that the government is not interested in the problem of health (7.8%), among others.
In fact, when citizens made reference to the most urgent task which, in their opinion, the government should undertake in order to improve the health situation, their ideas on what that task should be are very much related to the principal problem identified in this sphere. And so 13.9% hold that the Executive branch should provide medicines and materials for hospitals and clinics, while 12.1% held that it should control and lower the prices of medicines and consultations, and 11.4% considered that more clinics should be opened; 9.7% held the opinion that the government should hire more and better doctors, while 8.7% expressed the opinion that the government should construct more hospitals. Other tasks taken note of are: holding campaigns for prevention and vaccination, better attention to the health of the public, lowering the rates for attention to public health in terms of consultations and medicines, helping and attending the poor, and increase the budget for health services. A quick analysis of the previous data reveals that the major concerns of Salvadoran citizens on the question of health have to do with access to resources which allow for maintaining and guaranteeing health.
The poll also asked the following question: which institution offers better services in health care, the ISSS or the Ministry of Health clinics (MSPAS)? Some 38.4% said that ISSS provides better attention, one fifth of those responding said that MSPAS clinics provided better care and an equal number argued that the attention was the same in both; 0.8% said that neither provided good service and 18% did not express an opinion. Along the same line, those interviewed were asked to compare the quality of governmental hospital services during 1997 with that provided during 1996. A good part of the population considers that there have been no substantial changes; that is to say, that everything has stayed the same (40.4%); one fourth (24.5%) said that things had gotten worse and 72.0% thought that things had gotten better since 1996. Only 8.2% preferred not to express an opinion.
With regard to the cost of health services, those interviewed were asked to compare current services with those of five years ago. Knowing that for many the health care delivery system's principal problem is "the high cost of services", it is logical to find that the majority of the citizens think that costs have gone up: 77.8% of the population held that health services--and all that a health care delivery system implies--are more expensive today. For 14.6%, costs continue to be the same and only 4.2% thought that costs were lower than five years ago.
Those polled were also asked about the category which was for them the most expensive in the area of health. More than half (52.8%) said that medicines are the highest cost item, 18 of every 100 said that the highest costs were medical exams, 15 of every hundred expressed the opinion that consultations were most expensive, and 8 of every 100 interviewed held that hospital costs were most expensive, among other responses.
Another topic touched on in the poll, related to health costs, concerned the price of consultations in the MSPAS clinics. The results reveal that 17.3% of all Salvadorans are somewhat or very much in agreement with this charge, while 7.9% chose not to respond and three-fourths of the remaining number of persons interviewed are somewhat or completely in disagreement with the cost of the consultations. Moreover, almost one third (32.6%) indicated that they had stopped using the public health clinics because of the charges or quotas one had to pay in order to use them.
The UCA poll inquired into citizen opinion on the issue of privatization; more specifically the question was asked as to whether they were in favor of or against the privatization of ISSS and the Ministry of Health. With respect to ISSS, 55.5% held that they were not in agreement with privatization, 23.4% supported the decision to privatize and almost one fifth of the population did not express an opinion. Likewise, 65.2% stated that they were not in agreement that MSPAS should be privatized, 17.5% were in favor, and a similar number (17.2%) preferred not to express an opinion.
In an attempt to learn the opinion held by those interviewed on the service offered in general by the Ministry of Health, IUDOP asked those interviewed to evaluate the work performed by the ministry during 1997. The results yielded were that 67.8% thought that it was good or very good, 5.9% believed that it was regular and 20.4% qualified the work as bad or very bad.
It is curious that two thirds of the population offer a positive evaluation of the Ministry in question, in spite of the previous data that shows a critical attitude about the country's health system. In this sense, such figures could be contradictory, but it must be noted that upon examination of the configuration of opinions, many people base their criteria on the way in which they have always known that system. The better part of the population is capable of identifying the problems of the sector, but at the point in time when they are asked to evaluate the whole system, they did so on the basis of what they have come to consider normalcy in the system (lack of resources, expensive medicines, etc.). It must be recalled, however, that the previous data was gathered in a poll held at the end of last year. It is probable that, were a poll to be conducted today--taking into account the recent developments in the health sector--other opinions would be expressed. All in all, the poll allows for the establishment of some aspects which, in the population's opinion, ought to be improved and overcome in order to assure an efficient and useful health system for Salvadorans.
SUMMIT.
The second Summit Conference of the Americas took place in Santiago de Chile on April 18 and 19, with the participation of 34 presidents of all countries on the continent, with the exception of Cuba. The central theme of the meeting was the creation of a Free Trade Zone (ALCA) before the year 2005, for which the mechanisms for discussion between national transformations and the social and judicial transformations necessary for the rapid integration of all countries into the project. At the end of the conference, the presidents agreed, in general terms, to continue with the efforts to "strengthen democracy, political dialogue, economic stability, progress towards social justice, the degree of coincidence in the policies of open commercial trade along with willingness to advance the process of permanent hemispheric integration". Additionally, agreements were reached on how to better living conditions in the countries of the entire continent, how to combat human rights violations, forms of discrimination and poverty, placing special emphasis, therefore, on education as "a decisive factor for the political, social, cultural and economic development" of the region. Likewise, the presidents committed themselves to lay the bases for a commitment toward integration based on measures which guarantee transparency and consensus in negotiations (LA PRENSA GRAFICA, April 18, 1998, p. 28 and 29, and April 22, 1998, p. 10 and 11).CONSTRUCTION. The Public Works Ministry (MOP) reinitiated the construction of Avenida Las Azaleas, according to a report by Mr. Wilfredo Rosales, Viceminister of MOP. The construction will join Calle Chiltiupan, which, in turn, will cross the El Espino finca. According to reports by the Treasury Ministry, the project consists essentially in the construction and broadening of the avenue, as well as the elaboration of sumps for collecting rain water, sidewalks and cable cordons for a length of road two kilometers long. The San Felipe passageway, at the extreme south of the terrain, will, in the same way, be improved and broadened into a two-way highway. Additionally, "El Espino lands on the south side of that length [of highway] will be affected", according to the Treasury Ministry document. Rosales explained that the construction will detour vehicular traffic entering and leaving the New San Salvador and San Salvador municipalities from the northeast zone of the metropolitan area, by which means greater vehicular movement can be obtained. The project of Chiltiupan was held up, on March 26, by order of the Supreme Court when environmentalist organizations and some deputies opposed the construction for reasons of ecological damage which would allegedly have been incurred [as a result of the construction]. (LA PRENSA GRAFICA, April 11, 1998, p. 4).
CAMBIOS. The Legislative Assembly approved, on April 8, six decrees to reform the Law of the Judicature, to create, convert and reassign tribunals and jurisdictions, according to declarations made by representatives of that institution. A total of 41 tribunals were created: 21 tribunals for sentencing, 6 for reviewing and instruction, 10 for penitentiary tribunals and 4 justices of the peace. Additionally, 40 tribunals for penal cases, 24 tribunals for combined cases and one tribunal for justices of the peace had their functions changed into tribunals charged with reviewing and instruction. The majority of these tribunals are concentrated in San Salvador, given that this department has the highest indices of delinquency. The new regulations will affect the maximum authority for penal cases in the country: The Penal Chamber of the Supreme Court, the location of which was changed recently so that public oral arguments and judgements could be heard and presented. The Attorney General's Office will also be decentralized in the creation of 14 new subregional offices, additional to the 4 which now exist. According to the Technical Executive Unit (UTE), Mr. Rafael Flores y Flores, the United Nations Program for Development (UNDP) will support these efforts with 20 million colones for the Attorney General's Office and the Ombudsman's Office for the implementation of these projects. In other news, the new Penal Code will include the crime of administrative and bank fraud, for which the defendants implicated in the FINSEPRO case will be prosecuted (EL DIARIO DE HOY, April 7, 1998, p. 15, EL DIARIO DE HOY, April 9, 1998, pp. 3 and 8).
BLOCKAGE. The approval of a U.S. $58 million loan earmarked for high school education was mired once again in a blockage taking the form of a division of opinions issuing in the lack of a majority vote by Legislative Assembly deputies on April 17. This in spite of the fact that that same day the Directors of the National Institutes of El Salvador (CONIDES) and students of the national institutes presented a new petition for a bill demanding the ratification of the credits, no change was achieved on this issue. The World Bank (BM) offered the loan to El Salvador at the end of 1997; the FMLN, the USC and the PLD, and independent deputy Mr. Horacio Rios, nevertheless, opposed the loan. The position taken by these members of the Legislative Assembly aims at blocking the increase in the foreign debt, and on this issue their position is "unchanging" (EL DIARIO DE HOY, April 18, 1998, p. 4 and LA PRENSA GRAFICA, April 18, 1998, p. 4).
ENVIRONMENT. The Legislative Assembly concluded on April 17 the process of drawing up the text of the Environment Law, rejecting, at the same time, the principal observations presented by the President of the Republic, Mr. Armando Calderón Sol. Sections of the text presented for public consultation on environmental impact studies and security deposits for environmental compliance are some of the sections of the text objected to. References to the requirement for concession on conflict of interest, previously extended to include the issuance of environmental permits for the use and benefit from natural resources, were accepted (LA PRENSA GRAFICA, April 18, 1998, p. 4).