On April 2, President Sebastián Piñera announced the enactment of a bill providing for a Minimum Guaranteed Income in the form of a subsidy complementing the wages of lower-income workers. In addition, the Central Bank of Chile presented its March 2020 Monetary Policy Report to Congress, including the recommendation to enable the Central Bank to inject more liquidity into the economy at times of crisis.

Regarding the new minimum guaranteed income law, Piñera indicated that the subsidy in question will go “directly into the pockets of the workers,” and is not taxable, ensuring a liquid income of at least $300,000 Chilean pesos per month. According to the president, this measure represents an increase of up to 18% over the minimum wage in force since March.

In addition, the Senate Finance Committee met with representatives of the Central Bank to debate the March 2020 Monetary Policy Report. The conversation revolved around the legislative proposal to grant the Central Bank greater powers in health emergencies so that it can inject more liquidity to support the economy during periods of quarantine, through direct transfers to the population.

Also analyzed was the support given to other banks by the Central Bank so that they could weather the current economic crisis. The senators pointed out that this support had not filtered down to customers, since the banks continue to reschedule loans under normal terms. This last point prompted the Committee to call a meeting next week to host representatives of the Financial Markets Commission (CMF, for its acronym in Spanish) and the Association of Banks and Financial Institutions (ABIF, for its acronym in Spanish) to discuss this issue.