Local workers withdrew almost $310 million from their pensions in May, using government’s COVID-19 emergency withdrawal measure, according to statistics from the Department of Labour and Pensions.
There are a total of more than 73,000 private pensions in the Cayman Islands, and according to officials, more than 34,000 applications were received in May to withdraw money from those pension funds.
The emergency-withdrawal measure, which allowed workers to access their private-sector pensions up to a certain amount, was made possible through changes to the Pensions Law. It was one of the initiatives implemented by Premier Alden McLaughlin to assist employees impacted by the COVID-19 pandemic and the closure of local borders.
Deputy Director of Pensions Amy Wolliston, in response to queries from the Cayman Compass, said the total amount paid out in May under the emergency-withdrawal scheme was $309,885,025.
She said the figures for June and subsequent months are still being processed. It takes approximately 45 days for an application to withdraw pension funds to be finalised. A formal statement will be issued soon with the totals for May and June, Wolliston told the Compass.
Based on these initial numbers for May, it appears that Cayman is on track to hit targets predicted by Paul Byles, director of consultancy company FTS, in his report ‘The COVID-19 Pandemic in the Cayman Islands’ released in late April.
He projected between $373 million and $512 million would be withdrawn from pension funds.
In a June hearing of the Public Accounts Committee with pension providers, it was said that, cumulatively, the nine providers have more than 73,000 accounts, and based on that figure they said they were expecting $450 million in withdrawals.
Wolliston said 34,086 applications were received in May, and 25,596 of those were approved.
She said 8,490 applications were either rejected or were duplicates.
Wolliston said the department has received complaints from members of the public about the handling of applications by some pension plan administrators, and those matters are being investigated.
“Given that these matters remain under investigation, we are unable to provide any further comment at this time,” she said.
Under the emergency-withdrawal scheme, eligible individuals can withdraw from their private pension accounts up to 100% of the balance up to $10,000. Those with accounts in excess of that maximum can withdraw $10,000 and up to 25% of the remaining balance.
Together with the emergency withdrawals, government also implemented a pension holiday which took effect, retroactively, from 1 April to 30 Sept.
Last week, the premier, when asked if government will be extending the pension holiday, said, “It is within our contemplation.”
Wolliston declined to weigh in on the extension of the pension holiday, saying it would not be appropriate for her to comment on a government policy or a pending decision.
“The extension of the pensions holiday is presently under consideration by the government, which was discussed at the last press briefing. When a decision regarding this matter is reached, the relevant press release will be issued,” she told the Compass.
As for the department’s managing of the influx of applications, Labour and Pensions Director Bennard Ebanks said his team is faring well.
“As it is publicly known, there are challenges; however, the DLP staff are giving a great team effort in order to meet them. I am very pleased with the efforts of the Pensions staff and the DLP team as a whole,” he told the Compass via email.
Sorry. This form is no longer available.
Related: How to spend your pension money