Government formally enacted new changes Friday to the Public Service Pension Plan, most notably raising the retirement age from 60 to 65.
Government published amendments to three laws on Friday, raising the age of retirement in the civil service and setting a path for retirees to accept reappointments. The changes to the Public Service Management Law also set up a structure to transfer civil servants to other ministries for succession planning.
Pension law changes
Along with amendments to the civil service pensions, government published changes to the Parliamentary Pensions Law to give pensions to any members of the Legislative Assembly who served one full term between October 1959 and Aug. 23, 2004.
Government financial advisers have described the parliamentary pension as “severely underfunded.”
Before August 2004, members and Speakers of the Legislative Assembly did not have a pension plan. The amendment makes the retirement system for lawmakers retroactive.
Amendments to the Public Service Management Law and the Public Service Pensions Law move the retirement age for civil servants from 60 to 65. The Progressives-led government has planned for the retirement age increase for several years in an effort to shore up the underfunded public pension plan.
The new changes set a path for pensioners to continue working for lower pay or part-time while receiving retirement payments, or to continue contributing to a pension while working at the same pay grade or higher.
The new changes give the head of the civil service the power to transfer Caymanian employees to replace non-Caymanians in top-level positions in government, the law states, “in order to promote the advancement of a Caymanian to a key managerial or technical position in any part of the civil service.”
The non-Caymanian staff member bring replaced can be transferred to a position in the same pay grade or demoted to a lower-paying job. The transfers can happen within ministries and departments or between units.