De La Espriella government ends 36 years of contract with Fiduprevisora in the Fomag

The Colombian government announced on Friday, October 30, that it will not renew the thirty-six-year administrative contract with Fiduprevisora S.A. for the management of the National Fund for Social Benefits of Teachers, known as Fomag. The decision was formalized during an extraordinary session of the Fomag Board of Directors, ending an uninterrupted administrative scheme that has governed the system since 1990. The current agreement, identified as Commercial Trust Contract No. 083 of 1990, expires on October 31, 2026. Effective November 1, 2026, the state will initiate a transition period designed to overhaul the fund’s operations. Education Minister Ilva Myriam Hoyos Castañeda confirmed the termination via video message, describing the move as a historical state decision intended to protect fundamental rights. She stated that the administration could no longer prolong conditions that contributed to the current crisis or normalize its consequences. Hoyos emphasized that Fomag is not merely an administrative or financial instrument but the mechanism through which the state responds to the rights of those who educate Colombia. The decision follows recommendations from the Ministries of Labor and Finance, input from representatives of the teachers' union Fecode, legal and financial reviews, supervision reports, and findings from control entities. Labor Minister Natalia Lopez Fuentes reiterated that the burden of administrative inefficiencies cannot be shifted onto teachers. She asserted that health and social benefits are rights the state must protect, adding that the transition process must keep affiliates at the center to ensure their rights remain unaffected. Finance Minister Miguel Gomez Martinez previously raised alarms regarding the crisis during a political control debate in the Chamber of Representatives. He revealed that Fomag had been left with a deficit of 2.7 trillion pesos that needed coverage. Gomez called for the resources of the teaching corps to be managed with transparency, traceability, and control. The urgency of the change stems from severe operational failures within the teacher health system. The Health Superintendency disclosed that Fomag accumulates unpaid accounts exceeding 2.4 trillion pesos for medical services, supplies, and medications. As of June 30, fifty-one percent of this total, approximately 1.24 trillion pesos, recorded a delay of more than 180 days. The system faces a near-total paralysis in its care network. Out of 3,934 registered providers authorized to attend educators nationwide, the fund reported only one formally legalized contract in October. To address these issues, the government outlined a one-year transition plan starting November 1, 2026, which can be extended for an additional twelve months. Authorities guaranteed that medical service delivery will not suffer interruptions during this period. Medical consultations and ongoing treatments will continue without requiring new processes, while access to medicines and supplies will remain continuous. Additionally, the processing, recognition, and payment of severance pay, pensions, and other economic benefits will proceed according to applicable legal procedures. The Ministry of Education demanded that Fiduprevisora immediately submit a detailed activity plan to ensure uninterrupted functioning during the handover and prevent administrative inconveniences. Minister Hoyos indicated that all necessary studies will be conducted to establish conditions for a public bidding process. This future tender aims to offer a new service in accordance with the requirements set by Law 91 of 1989. To investigate past conduct, the education ministry requested a forensic audit to examine what occurred over the thirty-six years of the contract. The ministry also asked the Attorney General's Office to accompany the liquidation and transition process. Furthermore, the Health Superintendency was tasked with monitoring and surveillance duties to ensure healthcare institutions provide correct services to teachers and their families. The scale of the issue involves more than 800,000 affiliated teachers. Data up to 2024 showed that 401,114 members were older than fifty, representing forty-eight point nine percent of the group, while 113,789 were older than sixty-nine, accounting for thirteen point eight nine percent. For three decades, the health of this demographic has depended on a model involving three main actors. Fomag acts as a pool of resources gathering pension funds, severance payments, and teacher contributions, though it does not directly manage the money. Instead, it hires Fiduprevisora S.A., a trust entity in which the state holds the majority stake. Fiduprevisora is responsible for opening bids to hire health operators, who constitute the third essential component of the system. This structure has faced a long list of problems that became evident two years ago when the previous government of Gustavo Petro transformed the system. These changes drew criticism even within Fecode, the union representing teachers. The current administration under President Abelardo de la Espriella assumes responsibility for leading this transition, correcting documented failures, and rendering accounts on progress and pending matters. The ministry clarified that the decision does not imply ignoring acquired rights or labor achievements of the sector. The end of the contract is intended to correct adverse and irregular situations presented during its execution, ensuring that the state fulfills its obligations to the teaching profession.