SANTIAGO, (Reuters) – A new Chilean pension withdrawal was rejected by a congressional panel Tuesday night. This decision came after President Gabriel Boric had submitted a rival proposal just hours before that passed a vote in a different committee.

Chile is allowing pension withdrawals before the COVID-19 pandemic, in order to assist citizens with economic recovery. Since July 2020 three early pension withdrawals, each of which can reach 10% of the worker’s pension fund, have been approved. One fourth vote was defeated in December.

Boric’s government opposed an additional 10% withdrawal, believing it would inject too much money in an already troubled economy.

Boric’s government then introduced an additional bill, just hours before the scheduled vote. This would only allow for withdrawals in order to repay debts. According to the government, this measure would reduce inflationary effects.

Mario Marcel, the Finance Minister said that this was an attempt to make pension funds from workers more accessible for issues where they do not indicate higher inflation, greater demand or higher consumption.

This proposal by the government also caps withdrawals at 10%. However, it restricts access pension funds to alimony payments and mortgages. It also strengthens unemployment insurance.

The bills were both debated concurrently, but Boric’s bill cleared the committee first. Some legislators voted against a 10% blanket withdrawal, saying that government should have no say over the way people use their pension funds.

Both bills, despite the votes of the committee, will be subject to a full vote by the lower house. There, the unrestricted withdrawal can also likely to be defeated.

Boric supported all four of the previous withdrawals. However, when Boric spoke to reporters, Boric stated that a new withdrawal with no limits would “deeply harm the neediest” and increase inflation as well as lower the value their funds.

Boric explained that the bill was an alternative to traditional family planning, which Boric believes is both responsible and helps families make it through difficult times.