Il Nuovo Postiglione - Argentine Congress upholds Milei veto of pensions increase

Thousands gathered to protest Milei's veto, with police firing pepper spray and rubber bullets at one group -- including pensioners -- who angrily broke down a barrier after the vote.

Milei, a budget-slashing libertarian, last week blocked an 8.1-percent pension increase initially approved by both houses of Congress, which aimed to help cushion retirees in the South American country hit by annual inflation of almost 240 percent.

The president claimed the measure was "manifestly in violation of the current legal framework as it does not consider the fiscal impact of the measure nor determine the source of its financing."

After a bitter debate that lasted more than four hours, the presidential veto was upheld with 153 votes in favor, 87 against and eight abstentions.

"We cannot spend what we do not have, there is no money," said deputy Juliana Santillan of Milei's Libertad Avanza party.

The minimum pension is equivalent to $230 per month.

Several pensioners were among those who clashed with police or were detained.

- 'Betrayed' -

Patricia de Luca, a psychologist who has just retired, said she felt "betrayed and hopeless" after lawmakers endorsed the veto.

"It's an excessive security operation, it seems like we're coming to a war, not a parliamentary session," said leftist lawmaker Cecilia Moreau as she entered Congress ahead of the debate.

Since taking office in December, Milei has applied a drastic austerity program in a bid to rein in chronic inflation and decades of government overspending.

Inflation for August stood at 4.2 percent, the fourth consecutive month under five percent and a massive drop from the 25.5 percent recorded in December.

However year-on-year inflation was still sky-high at 236.7 percent.

Critics say the steep drop in inflation and other apparent economic wins have come at the cost of the poor and working classes, and due to a strangling of the economy.

Congress had the power to overturn Milei's veto with a two-thirds majority vote in both chambers, where the ruling party is in the minority, and divided.

However, several lawmakers with the centrist Radical Civic Union (UCR), the driving force behind the law to increase pensions, announced Tuesday that they had changed their position and were now in favor of the veto.

Milei's veto particularly sparked anger as it came after he decreed an increase of $102 million in the budget of the state intelligence agency -- which amounts to a 700 percent increase -- without requiring justification of expenditure.

M.Dodaro--INP