Brazil’s troubled social security system posted a record deficit in 2017 of R$182.45 billion, or 2.8% of GDP, the Finance Ministry said Monday. The deficit was up a whopping 21.8% from R$149.73 billion in 2016. The ministry’s social security secretary, Marcelo Caetano, said, “The figures show the absolute necessity for a social security reform.” Brazil’s Congress is set to begin action on such a reform on February 19. The reform sets minimum retirement ages and creates other limits on claims to the system. Caetano said the reform would cut social security expenditures by R$5 billion to R$6 billion in the first year alone, with rising savings in future years. The government’s current forecast for the social security deficit in 2018 is R$192.8 billion. The forecast does not include potential savings from the reform bill.
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