Legislation on pension reform now available for public scrutiny
BASSETERRE, ST. KITTS, APRIL 22ND 2012 (CUOPM) – Legislation on pension reform is now available for public perusal.
The Pensions (Amendment) Bill, 2012 in the name of the Attorney General and Minister of Justice and Legal Affairs, the Hon. Patrice Nisbett was introduced and given a first reading at the March 29th 2012 sitting of the St. Kitts and Nevis National Assembly.
It is aimed at reforming the pension scheme which has the effect of moving away from the existing Defined Benefit Pension Plan to a new Defined Contribution Pension Plan.
It seeks to ensure that the pay out from the plan should supplement the employee’s Social Security benefits in order to ensure that the retired employee has sufficient funds to be able to maintain a standard of living similar to what the retired employee enjoyed before retirement.
“The reform being introduced by the Bill would make the existing Public Service Pension Benefit plan more affordable and much more predictable with respect to the Government’s ability to plan successfully to meet its future pension liability,”said the Attorney General.
Explanatory notes provided with the Bill state that Clauses 1 and 2 make provision for matters of a preliminary nature, that is, short title of the Bill and interpretation of certain words.
Clause 3 seeks to convert sections 1 and 2 of the Pensions Act into Part I, while Clause 4 seeks to convert sections 3 to 23 of the Act into Part II.
Clause 5 of the Bill seeks to amend the Act by introducing to the Pensions Act, three new parts entitled (a) – “PART III -CONTRIBUTIRY PENSION PLAN”; (b) “PART IV – WIDOWS’, WIDOWERS’, and AND CHILDREN PENSIONS”; (c) “APPLICATION OF ACT TO GOVERNMENT AGENCIES and “PART III -CONTRIBUTIRY PENSION PLAN.”
This part has 34 Clauses. Under this Part, Clause 24 thereof speaks to interpretation of certain words used in this Part, while Clause 25 thereof speaks to the application and commencement of the provisions of that Part.
The provisions of this Part are intended to apply only to officers who join the public service of the State on or after the coming into force of the provisions of this Part and is required to contribute to the Fund in accordance with the provisions of this Part. The provisions of this Part shall come into force on such date as the Minister may, by Order, appoint.
Clause 26 seeks to establish Pensions Fund into which shall be paid all contributions and other sums of money properly accruing to the Fund; and out of which Fund there shall be paid all benefits, refunds and expenses incurred in the management of the Fund. The Clause makes provision for related matters.
Clause 27 thereof seeks to establish a Public Service Pensions Board, which shall be made up of not more than seven members, and its composition to be as follows: (a) – the Head of the Public Service; (b)- the Financial Secretary; (c) – the Chief Personnel Officer; (d) – the Director of Social Security Board; (e) – three members appointed by the Minister from nominees of the associations or unions recognized by the Government as representing public officers and other employees of the Government.
Clause 28 provides for the functions of the Board, which would be to consider claims of contributors, and to perform such other functions as the Minister may assign to the Board.
Clause 29 makes provision for the management of the funds of the Fund, and in that connection, it seeks to vest the management in the hands of the National Social Security Board. The management will be exercised for a given period of time, after which it may be managed by another service provider.
Clause 30 seeks to require the Board to make annual reports to the Minister who would then lay such reports before the National Assembly.
Clauses 31 to 35 seek to make provision relating to how contributions are to be made, Government’s contribution, cessation of contributions, making of contributions during leave of absence without salary, and making of contributions during leave of absence with bursary.
Clauses 36 to 38 seek to make provision relating to the pensionable right of a contributor (which shall be as of a right where the contributor satisfies the required qualifications), circumstances which entitle a contributor to payment of a pension, and service which does not qualify a contributor for pension.
Clause 39 seeks to provide for refund of contributions where a contributor’s services are terminated in public interest, while Clause 40 seeks to make provision relating the age of compulsory retirement.
41 to 47 seek to make provision relating to maximum pension, deferred pension, effect or re-employment of pensioner on amount of pension, refunds, option to re-instatement in the Fund in certain circumstances, refund where there is no legal personal representative of the contributor, and proof that the pensioner is alive.
Clause 48 seeks to make provision requiring a contributor to provide the Board with certain information in writing, while Clause 49 seeks to make provision for the period when a pension begins to accrue to a contributor.
Clauses 50 to 57 seek to make provision relating to pensionable service and computation of pensions.
The section – “PART IV – WIDOWS’, WIDOWERS’, AND CHILDREN PENSIONS” has five Clauses. Clauses 58 and 59 make provision for matters of a preliminary nature, that is, interpretation of certain words used in this part, application and commencement of this Part.
Clause 60 seeks to make provision for pensions payable to widows, widowers, and children by spelling out the percentages that would be payable.
Clauses 61 and 62 seek to make provision relating to payment and administration of children’s pension and adjustments that may be made to pensions.
“PART V – APPLICATION OF ACT TO GOVERNMENT AGENCIES has four sections.
Clause 63 seeks to make provision for the interpretation of “government agency’ and to make provision for the commencement of that Part.
Clause 64 seeks to make provision regarding regulations respecting public officers who may be transferred to a government agency, while Clause 65 seeks to provide for the pension rights of transferred non-pensionable officers and of new employees of government agency.
Clause 66 seeks to make provision for matters of a transitional nature.
The Bill seeks to introduce three new Schedules to the Pensions Act, namely, Second Schedule (Investment of Moneys of the Fund); Third Schedule (Provisions relating to the operation of the Board); and Fourth Schedule (Pensions to Contributors Injured in Discharge of Duty).
Attorney General Nisbett presented the Bill to the National Assembly making it a public document.
In keeping with the policy of the government, The Pensions (Amendment) Bill, 2012 is now available for perusal by the public.
Interested groups and individuals can now peruse the Bill and submit comments, suggestions and recommendations to Legal Department in the Attorney General’s Office, Government Headquarters, Church Street, Basseterre or email email@example.com
The Bill is available on line at www.cuopm.com