Argentine Senate passes bill to raise pensions

* Argentine President Fernandez likely to veto measure

* Bill passed after tie-break vote by rogue vice president

BUENOS AIRES, Oct 14 (BestGrowthStock) – Argentina’s Senate
narrowly passed legislation early on Thursday to boost pension
benefits — an opposition-led measure that President Cristina
Fernandez is likely to veto, arguing it would cost too much and
lead to economic crisis.

The bill was passed shortly after midnight when Argentine
Vice President Julio Cobos, who also presides over the Senate,
cast a tie-breaking vote in favor of the legislation.

Argentina’s lower house passed the bill in August, putting
the center-left president in the uncomfortable position of
opposing a popular measure ahead of an October 2011
presidential election. [ID:nN19255736]

A veto would be politically risky as Fernandez’s husband
and predecessor Nestor Kirchner is seen as a likely candidate
in next year’s presidential race.

Double-digit inflation in recent years has stoked demands
for wage and pension hikes. [ID:nN13269275]

The measure would raise basic pensions to 82 percent of the
minimum wage, which government officials said would cost
roughly $10 billion a year.

Cobos is an opposition leader who Fernandez made her
running mate in 2007 to form a coalition ticket. As head of the
Senate, he blocked her key initiative in 2008 to raise export
taxes on the country’s main crop, soy. They have barely spoken
since.

Economy Minister Amado Boudou has warned that if the
pension reform were enacted, Latin America’s No. 3 economy
would face a period of “spiraling debt and a permanent fiscal
deficit.”

The bill, which would benefit some 5 million retirees,
would raise minimum pension benefits to 1,427 pesos ($357) from
1,046.50 pesos currently.

Funding for the increase would come from tax revenues
exceeding the level set forth in the budget and from the ANSES
agency’s surplus, according to the bill.

($1 = 4.00150 Argentine pesos)

(Reporting by Magdalena Morales; Writing by Eduardo Garcia;
Editing by Will Dunham)

Argentine Senate passes bill to raise pensions