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“[…] Thousands have been retrenched, with more losing their livelihoods every day. Thousands can’t get a salary increase for more than eight years now. Prices going through the roof. And to rub salt in the wound of working people, they proposing to cut our NIS pension. This is how working-class people are treated …”
The following Letter to the Editor about increasing the retirement age to 65 was submitted to Wired868 by Alva Allen, a former labour representative on the National Insurance Board:
One minute on 2 May 2018, in a press release, the minister of finance, Colm Imbert, say that ‘the minister of finance has made it clear that the government has no plan to increase the retirement age.’
The next thing you know, six weeks later, on 28 June 2018, directors of the National Insurance Board (NIB), of which three are appointed by the government, accepted the 10th Actuarial Report that included the extension of the retirement age to 65.
Then, one week later, on 6 July 2018, the International Monetary Fund (IMF) issued a Staff Concluding Statement of the 2018 Article IV Mission, which stated inter alia: “Staff welcomes proposals to further increase the contribution rate and gradually raise the effective retirement age from 60 to 65 starting in 2025 to keep the system sustainable and reduce contingent liabilities to the government.”
I am sure that the IMF must have been rejoicing.
This story about extending the retirement age to 65 reminds me of when Prime Minister Dr Keith Rowley told a public meeting in Marabella on 5 September 2018, that the government was not closing down Petrotrin. On 30 November 2018, Petrotrin was closed down.
By now I have come to accept that politicians are trained to practice social distancing from the truth.
Now the minister of finance finally said in his budget speech on 5 October 2020: “… we will take whatever steps necessary to maintain the integrity and viability of the NIB, including a serious examination of the need to extend the retirement age to 65.”
This thing is serious. This proposal to extend the retirement age is nothing but a smokescreen to cut we hard-earned pension benefits. After all, it was the actuary who said on page 58 of the 10th Actuarial Report on the NIS:
“… It is important to note as well that since the retirement age, as given in the National Insurance Act, is already 65, an increase in “retirement age” is only hypothetical from the standpoint of the NIBTT and effectively just functions to delay how pensions are actuarially reduced over the implementation period.”
According to recommendation no. 3 on page 94 of the 10th Actuarial Valuation of the National Insurance Scheme: “It is recommended to reduce the calculated pension, which includes the minimum pension, by 6 per cent for each year before age 65.”
This report was approved by the NIB directors on 28 June 2018, according to page 18 of the 2018 Annual Report. The report was subsequently laid in parliament on 22 March 2019.
In my view, if this recommendation is implemented, workers who normally retire at age 60 will get a 30% cut in their pension, so they will get $2100 per month. This is $900 per month less than we receive now. They will be losing $10,800 every year, even though they paid the minimum requirements of 750 contributions.
Well, look at trouble now! The same monkey pants await those workers who retire before age 65.
Those retiring at age 61 will get a 24% reduction in their pension. They will get $2280 and stand to lose $8640 per annum.
Those retiring at age 62 will get an18% reduction in their pension. They will get $2460 per month and stand to lose $6480 per annum.
Those retiring at age 63 will get a 12 % reduction in their pension. They will get $2640 per month and stand to lose $4320 every year
Those retiring at age 64 will get a 6% reduction in their pension. They will get $2820 per month and stand to lose $2160 every year
Those who retire at age 65 will get no reduction in their pension. This is what the actuary called an unreduced pension at age 65
In the 9th Report, the actuary said on page 107 that ‘The minimum is too generous … it should be a percentage of the minimum wage.’ The report went on to say that the international range of the minimum pension is between 40%–80% of the minimum wage.
On page 2 of the 10th report, the actuary reported that the NIS minimum pension is 115% of the minimum wage and the senior citizens’ pension is 134% of the minimum wage.
Clearly, there is the view that poor people are getting too much pension, and it has to be cut. It is little wonder that the report recommended on page 95 that ‘the parameters of the system should be automatically adjusted and the minimum pension should be frozen to give at most 80 per cent of the minimum wage.’
The real sting in de tail is not the extension of the retirement age to 65 per se, but the cuts in pensions for workers retiring between age 60–64. All because they find that the minimum pension is too generous and should be below the minimum wage.
They will come with all kinds of cock and bull story to get you to buy into their position, like fertility rate, interest rate, mortality rate. longevity rate and that expenditures have now outstripped revenues.
This is the same minister of finance who, according to a Loop news report of his media conference on 2 October 2018, said:
“Yes, the actuaries have said that if we don’t look at the national insurance situation, the fund will expire 35 years from now, so we have 35 years to fashion a solution to that problem.
“We are not going ahead with the increase in contributions at this time. the nib will survive. it has over $20 billion in its fund, it has enough money there for the next 30 years.”
The stark reality is that the actuary said that our minimum pension is too generous and must be reduced to 80% of the minimum wage. By increasing the retirement age, the government will reduce its contingent liability (cut its expenses).
Well, look at real trouble here now! Thousands have been retrenched, with more losing their livelihoods every day. Thousands can’t get a salary increase for more than eight years now. Prices going through the roof. And to rub salt in the wound of working people, they proposing to cut our NIS pension. This is how working-class people are treated.
But when it came to increasing the pensions of MPs, ministers and others, the same minister of finance tabled legislation in June 2019 to fix their business nice. They fixed it real nice. They legislated raising their pension benefits every five years and included in the calculation of pensions the housing allowance of these office-holders.
It is clear that they have always taken good care of their business. We, working people, must take care of ours. We must organise to stop any cut in our pensions.
(Courtesy ATGTWU)
Many workers have already paid the minimum 750 contributions to qualify for the minimum pension. They are continuing to pay more while moves are afoot to give them less. This is utter madness and, like Brother Resistance, we must say: ent takin’ dat so; de people ent takin’ dat!
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Do the PNM and UNC people who drove a dump truck through the treasury actually need a pension?
Isn’t their retirement plan a luxury apartment in London, a mansion in Panama or Florida, maybe summer in Monaco.
Pensions should be for those politicians who actually didn’t thief and therefore need something to fall back on in old age.
But what options do we have? We could vote out de govament? Refuse to accept the pittance deh giving we? Fire de wuk? Bun dong de Red House–or try to?
What do you recommend, comrade?