Three serving lawmakers receive pensions

Three elected members of the Cayman Islands Legislative Assembly are receiving parliamentary pension payments while continuing to serve in the LA, according to information released by the Public Service Pensions Board under an open records request.

According to the records, Premier McKeeva Bush, George Town MLA Kurt Tibbetts and Bodden Town MLA Anthony Eden are receiving pension payments in addition to their monthly salary.

Mr. Bush earns roughly $160,000 per year in salary following a 10 per cent pay cut he took in 2010. He is eligible to earn more than $100,000 per year in payments from the parliamentary pension plan at the maximum payment of two-thirds of salary.

“I have paid my pension for over 25 years, and by law I am now eligible to receive my pension,” Premier Bush said Thursday. “I now receive it.”

Long-serving MLA’s Mr. Tibbetts and Mr. Eden, would earn roughly $100,000 a year following a 3.2 per cent pay reduction they received in 2010. Both receive 80 per cent of the maximum two-thirds of salary payment for pension, which works out to about $53,000 per year in pension payments at that salary. 

However, if those pensions were calculated on their previous salaries they would be considerably higher. Mr. Tibbetts earned about $173,000 as Leader of Government Business in 2009 – that would make his pension approximately $93,000 per year under the previous calculation. 

Mr. Eden earned about $157,000 as Health Minister in 2009. That would make his yearly pension close to $83,000 using the same calculation as above. 

Mr. Eden said he accepted the parliamentary pension in January 2009 after suffering a serious heart problem. He said he was also uncertain of this future position due to the then-impending May 2009 elections.

“You’re entitled to it, I could have deferred it until later down the line, but I’ve got nothing to hide,” Mr. Eden said in a telephone conversation with the Caymanian Compass on Thursday.

The Bodden Town MLA said he’d be happy to serve the people in his district again following the 2013 elections, if they’ll have him. “If the people of Bodden Town say they want me, God willing, I’ll seek [the election] again,” Mr. Eden said. “I’m back to being healthy again.”

Mr. Tibbetts said he also began receiving his pension in 2009, actually taking less than the maximum pension he could have earned if he waited a few years longer.

“A pension is something that you have earned,” Mr. Tibbetts said. “I was entitled to do so and I made a decision to collect less than the vested amount.

“There are many other people in the civil service and who receive pension now and are working. There are people who are collecting pension that will seek [elected] office again.”

North Side MLA Ezzard Miller, who first raised the issue of serving MLAs receiving pensions, sought to change the law last year to eliminate the ability of serving lawmakers to “double dip” – as he called it.

Mr. Miller also panned the Parliamentary Pensions Law provision that allows lawmakers to retire and receive at least some pension benefit after just four years of service in the LA. The Parliamentary Pensions Law allows MLAs to retire once they reach age 55, although it does not force them to do so.

“It’s not only happening in parliament,” Mr. Miller said of the pension plus salary payment issue. “It’s happening in other places in the civil service as well.”

A Caymanian Compass review of civil servant salaries last year revealed that there are 65 people who retired from the civil service under the defined benefit pension programme – which means they are receiving a monthly pension while continuing to work in government. Those workers are typically employed on a fixed-term contract and, therefore, also receive a salary.

There is nothing illegal about this process. In fact, the Public Service Pensions Law provides for this very situation. The Parliamentary Pensions Law also allows for it in the case of elected members or the Speaker of the House. According to the Public Service Pensions Law: “A retired (plan) participant who is receiving a pension and who is subsequently reemployed in the service shall continue to receive that pension without interruption upon reemployment but shall be ineligible to make contributions or accrue further benefits under the plan.”

The Parliamentary Pensions Law in Section 27(2) states: “Where an active participant becomes eligible for a pension while he is a member or a speaker, he may elect to be paid such pension, and if he so elects shall thereafter continue as an active defined contribution participant until such time as he ceases employment; or he may elect not to receive such pension and to continue contributions to the plan until such time as he reaches the maximum pension, and where that occurs he shall continue thereafter as an active defined contribution participant until such time as he ceases employment.”

For civil servants, who are forced to retire at age 60 in any case, those employees are already receiving a pension, as well as healthcare benefits under their retirement plan.

“Until such time they move (the retirement age) up, there is no option,” said Civil Service Association President James Watler.

If government brought in a new employee to fill the retirees’ post, additional costs for pension and health care would be incurred for that new worker, Mr. Walter said, as opposed to the retiree who would not receive any further pension or health care benefit other than what they had already earned.

“I believe there is a savings there for government,” he said, referring to hiring of retired civil servants.

0
0

6 COMMENTS

  1. Para 3: the correct word(s) is/are is paid or receives NOT earns, in my opinion.
    Anyone receiving a full salary from public funds should not receive at the same time any pension from public funds, except to the extent that their current salary is less than their retiring salary. What can be fairer than that? All else is double payment. This used to be the rule in all British public services.

    0

    0
  2. It might be interesting to know if any MLA’s say in last 5 years (limit so it is not too onerous on foi staff to dig thru old files)were receiving a paycheck as an MLA and was also recieving any government pension at the same time.

    0

    0
  3. It’s amazing how often politicians fail to appreciate the difference between right and wrong, and legal and illegal.

    It is perfectly possible for a course of action to be both completely legal, and entirely wrong, as many UK members of parliamanet learned to their cost during the expenses scandal.

    Those who make the law should not attempt to hide behind legality when defending their actions.

    And if any MLA believes it is acceptable to draw both a salary and a pension from public funds at the same time, then his moral compass is seriously skewed.

    0

    0
  4. For Mr Watler:
    What about young people coming out of school/ further education looking for jobs, including in the civil service? Do they see it as fair that someone aged 60 who has had a salaried job in the civil service from age 18 (or earlier) to 60, and is now re-employed on salary and pension, keeps them out of a starting job (at the end of a chain of jobs, of course, not the specific job the fat cat is enjoying)?

    0

    0
  5. McKeeva’s comment that he paid his pension for 25 years is simply not true.

    The government pension plan is a defined benefit plan. This means that the pension pays out based on his time served and his salary at the time payments are due. He has not paid a penny in to the pension fund. Government is supposed to keep funds in there to support the obligation but they are not allocated to individuals.

    If the plan was a defined contribution plan then there would be no issue. His pension would be determined by the amount he had paid in over time and he would simply be withdrawing money from his own account.

    McKeeva knows full well that the government pension plan is underfunded. There are currently not enough funds in the plan to meet the future obligations. He read the Miller report. He is simply trying to get as much as he can before it runs out.

    0

    0
  6. Come on, fat cats! Put your paws up and tell us why you think you earned or need salaries plus pensions. Tell us why you deserve to keep young people out of jobs and enjoy the easy life. This is not what the old Caymanian life style was about, is it? This is not what those National Heroes toiled for to improve Cayman, is it?

    0

    0

Comments are closed.