Turks and Caicos Islands to eliminate pension ‘double dip’

The Turks and Caicos Islands – under British direct rule since 2009 – will eliminate the practice of civil servant double-dipping; earning a pension while at the same time drawing a salary from government.  

The change was just one of several announced Wednesday by Governor Ric Todd in attempts to resolve a number of funding problems within the Turks government’s non-contributory retirement scheme. Among those issues were administrative mistakes that led to $2 million in payment errors to pensioners, most of which would have to be “written off” by the government.  

“Retired civil servants, employed after April 1992, who have been in receipt of $1.5 million of unlawfully paid gratuities and pensions under the Pensions Ordinance will not be penalised,” the announcement read. “Erroneous payments will be validated and written-off.”  

Governor Todd said the Turks’ pension law going forward would end the payment of pensions to civil servants who are re-employed by the government after they have retired.  

“The 2011 pension review identified cases of civil servants who had been re-employed by the Turks and Caicos Islands government after they had retired aged 55 and who were still collecting a pension,” the governor’s statement read. “Retired civil servants who were employed before April 1992 are entitled to the pension earned before that date under the government’s pension scheme. However, under Pensions Ordinance, they are not allowed to receive that pension is they are re-employed by government. 

“The payment of their Turks and Caicos Islands government pension while they continue to be employed effectively doubles their income at a cost to the TCI taxpayer.”  

The amended version of the ordinance will only allow payment of civil service pensions once those employees stop working for government entirely.  

The Turks and Caicos Islands also intend to change the required retirement age from 55 to 60, according to Governor Todd.  

In August 2009, the United Kingdom suspended the Turks and Caicos’ self-government after allegations of ministerial corruption. 

The ‘double dipping’ issue has been raised in the Cayman Islands, which is also a British Overseas Territory, both in the context of the civil service and with currently serving members of the Legislative Assembly. 

According to an employee survey done by the Portfolio of the Civil Service in 2009, there were 146 government employees who were Caymanians, 60 or older, who continued to work for the civil service past the typical age of retirement.  

Under the current system, all of those workers would at least be eligible to retire and receive a monthly pension – if they were a part of the defined benefit retirement plan. However, if they were to continue in the civil service under a one-, two- or three-year contract, they could continue to receive a salary. 

An open records request filed last year by the Caymanian Compass found that three Cayman Islands lawmakers, including Premier McKeeva Bush, George Town MLA Kurt Tibbetts and Bodden Town MLA Anthony Eden have all officially ‘retired’ and are now collecting pensions, as well as salaries as serving members of the LA.  

Premier Bush has previously justified his and fellow politicians’ decision to receive their parliamentary pensions while still serving in the Legislative Assembly, saying by doing so, they save the country money. 

“Opting to receive these benefits at this time, in effect, has closed the defined benefit plan to those of us who opted out, thereby reducing the future cost to government that would have resulted in some cases, from additional years of service specifically in my case, as well as the others, cost of living and any future salary increases. We can’t be paid on any of these things,” Mr. Bush said.