Sunday, 12 July 2020

Caja Is In Trouble, But There Are No Immediate Liquidity or Solvency Problems

"The Government of the Republic will never, ever, leave the Caja without the necessary backing to take care of us as a country. It is my guarantee," said President Carlos Alvarado

In the midst of a crisis due to the coronavirus pandemic, the Caja Costarricense de Seguro Social (CCSS) is requiring the government to pay a debt of ¢1.95 trillion colones to face the lack of income from worker-employer contributions.

In response, Costa Rica President Carlos Alvarado said: “there is no money.” He added that “these amounts, at this time, are not within the reach of the Government or the State”, but he clarified that “that does not mean that it is a rejection” as they seek to find a solution through dialogue.

The ¢1.95 trillion colones (+/- US$3.5 billion dollars) represents almost 70% of the money the Central Government requires this year to pay the salaries of its officials.

- paying the bills -

Finance Minister Rodrigo Chaves also replied that it is impossible, saying “it is outside the real possibilities of the country and the framework of macroeconomic responsibility”,

He added that in the midst of a pandemic where there is unemployment, companies without incomes and entities without sufficient funds to provide care, “the country must not dedicate disproportionate amounts to a single institution, but must be fair and balanced with all families, companies and institutions”.

The news spread like wildfire on the social networks, some media outlets digging the grave, while others burying the Caja.

Román Macaya, executive president of the CCSS, confirmed that the Board (its nine members) stated that the debt that the State has with the institution (for health insurance and pensions) amounts to ¢1.95 trillion, supported by accounting and financial records of the institution.

He clarified that the estimate does not include the amount that results from the execution of a judicial sentence that obliges the State to finance the first level of health care, that is, the Ebáis (Basic Teams for Comprehensive Care).

- paying the bills -

“It was suggested that the resources would help to maintain a strengthened institution to deal with the pandemic, to contribute to the economic reactivation of the country and to provide health services in the future with quality and opportunity that requires the Costa Rican population,” said Macaya.

The purpose of the Board’s decision requesting the payment, he explained, is to prevent further affectation of the CCSS, “an institution that is carrying a great burden with the attention of the pandemic and constitutes one of the pillars in the reactivation of the country”.

Though President Alvarado maintained firm that the “there is no money” to cover the request of the CCSS Board, he assured that “The Government of the Republic will never, ever, leave the Caja without the necessary backing to take care of us as a country. It is my guarantee as president”.

Despite the tough stand by heads of the Treasury and the Central Bank, that nothing could be done and that the country could not go bankrupt to save the Caja, President Alvarado was more conciliatory and affirmed that he was committed to strengthening and developing the Caja and proposed creating a bilateral team “to look for solutions with creativity”.

“On the part of the Board, proposals were made that were emphatically rejected by the minister and the president of the Central (Bank). A gigantic new challenge opens. What the CCSS means for our people has been clearly demonstrated, there are those who do not stop to meditate and seek solutions to avoid their bankruptcy. We have to join forces and start raising our voices. We cannot allow this,” said the President in a message on Twitter.

"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

Related Articles

Alvarado to the press: “They use me to speak things that are insipid”

(QCOSTARICA) Costa Rica's President, Carlos Alvarado, accused the press on Thursday...

COVID-19 Costa Rica: 107 hospitalized and 245 new infections

(QCOSTARICA) Hospitalizations reached their highest number since the start of the...


My continuing saga with the AyA…

Rico's DIGEST - In May I wrote about my outrageous water bill, a whopping ¢34,000 colones when my average monthly usage/billing for the 12...

Where is the COVID-19 headed? Risk points to nursing homes, prisons, and coffee pickers

(QCOSTARICA) "May God protect us if we get a positive case of COVID-19! It would be a slaughter”. That is the fear of Maritza...

COVID-19 Costa Rica: 107 hospitalized and 245 new infections

(QCOSTARICA) Hospitalizations reached their highest number since the start of the pandemic on Tuesday with 107 patients, most of them admitted to the Specialized...

CCSS testing center at the border with Nicaragua shot at

(QCOSTARICA) The headquarters of the Phytosanitary service of the Caja Costarricense de Seguro Social (CCSS), at the Peñas Blancas border with Nicaragua was attacked...

In chase of asymptomatics, Alajuelita targeted first

(QCOSTARICA) A total of 1,850 people are the target of the massive random testing that the Caja Costarricense de Seguro Social (CCSS) will be...

During first months of the pandemic AyA only read 3,000 of 370,000 water meters in the GAM

(QCOSTARICA) During the first months of the pandemic (March and April), the 62 officials of the AyA (water utility) charged with reading water meters...

Let's Keep This Going!

To be updated with all the latest news and information about Costa Rica and Latin America.