Brazil’s Rousseff favors piecemeal pension reform

* Rousseff: sweeping pension reforms trigger run on system

* Agrees pensions rule need changes, more money

BRASILIA, May 17 (BestGrowthStock) – Brazilian ruling party
candidate Dilma Rousseff said on Monday the country’s social
security system required gradual adjustments but ruled out a
broader reform of the costly pension system.

“Experience shows that it’s better to make systematic
adjustments rather than a big reform,” Rousseff told CBN radio
in an interview.

“Broad reforms have produced several pitfalls. They
provoked a run on the system and an effect contrary to that
desired,” said Rousseff, a trained economist and President Luiz
Inacio Lula da Silva’s former chief of staff.

Investors are closely watching the growing deficit of
Brazil’s social security system, which accounts for one of the
government’s largest expenditures.

With an aging population the deficit could expand more
rapidly in coming years if no cuts are made, some economists
warn.

Rousseff’s main rival in the October presidential race,
former Sao Paulo state Governor Jose Serra of the centrist PSDB
party, last week told CBN that the pension system needed a
reform to cut back privileges. While the vast majority of
Brazilians receives less than $600 per month after retiring,
civil servants are paid as much as $12,000.

Rousseff said piecemeal reforms would be more effective in
helping control the widening deficit.

“We’ll need to get more money, change the rules. We’ll have
to negotiate that change of rules with society.”

Rousseff trails Serra by as much as 10 percentage points in
one poll but has surpassed him in another.

Stock Market News

(Reporting by Raymond Colitt; Editing by Doina Chiacu)

Brazil’s Rousseff favors piecemeal pension reform