Santo Domingo.- Representative Rogelio Alfonso Genao submitted to the Dominican Republic’s Lower House a proposed Organic Law of the Social Security System that would replace Law 87-01 of 2001.
The bill seeks to increase pensions, reduce fees charged by pension fund administrators (AFPs), strengthen transparency requirements, and expand healthcare coverage for workers, their families and pensioners.
Under the proposal, the maximum AFP commission would gradually fall from the current 0.90% to 0.40% by 2036, beginning with a reduction to 0.85% in 2027 and decreasing by 0.05 percentage points annually.
Genao said the initiative is based on three priorities: higher pensions, lower commissions and greater transparency.
The proposal cites AFP earnings of RD$5.93 billion in 2025, with a 24.9% return on equity, compared with 17.7% for commercial banks. It also states that AFP operating expenses accounted for 62% of commissions collected that year, or RD$7.2 billion, up from 48% in 2020.
To limit costs, the bill would cap AFP commercial expenses at 10% of commissions and introduce additional transparency requirements.
For Health Risk Administrators (ARSs), the proposal would limit administrative and commercial expenses, as well as payments for services provided by affiliated companies, to 10% of the per-capita payment. Entities exceeding the limit would have to reimburse the difference using their own funds.
Genao argued that workers’ pension savings should primarily benefit contributors rather than the companies managing them.