Editorial for 30 May: Fix in pensions sorely needed

It’s welcomed news that the National Pension Bill 2012 will
address, in part, employers who abuse the pension system.

If the bill passes, it will be the first major revision to
the National Pensions Law, which was created in 1998.

According to Employment Minister Rolston Anglin there are
more than 600 companies that aren’t with compliance with the pension law, and
that’s just the ones that government knows about.

Employers are required to make pension contributions on
every Caymanian employee between the ages of 18 and 65, and on all expatriate
employees who have been continually working on the island for nine months or more,
or who are not employed to do housework in private residences. 

In total, the Pensions Law requires 10 per cent of the
employee’s salary to be paid to an approved pension plan administrator, with at
least five per cent being contributed by the employer.

Unfortunately, this is not happening in all cases. Some
employers are even deducting pension payments from their employees and then not
making the required payments on behalf of that employee to an approved pension
plan administrator on a timely basis, if at all.

What it means at the end of the day – especially for
Caymanian employees – is that they won’t have money ‘in the bank’ to take care
of them once they retire. That puts Caymanians on the government dole.

The new bill is also giving Caymanians a chance to stay in
their work chairs longer to put more money into the pension scheme; it has
suggested that the retirement age be increased to 65.

There are many people who are more than willing and are able
to work longer than the age of 60. It is time for government to make that
acknowledgement.

Likewise the bill ups the age from 50 to 55 for those who
want to take early retirement pension payments.

Unfortunately the bill continues to exclude domestic helpers
from the Pension Law. It’s time that the law governing private sector pension
plans be addressed and fixes made. Now attention needs to be turned to the
public pension scheme.

 

 

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