Acting on complaints he said that he received from pensioners, civil society activist Christopher Ram backed by ten unions has written to the National Insurance Board (NIB) calling for compliance and the payment of arrears owed.
Mr Ram estimates that these arrears could mount up to $5b. The arrears, he said, stem from the failure of the National Insurance Scheme (NIS) to comply with regulation 4(b) of the Benefit Regulations which was amended in 2015 to increase the statutory minimum old-age pension from 40% to 50% of the Public Service minimum wage.
“The last year in which this requirement was met was 2020, when the Public Service minimum wage was $70,000 and the NIS minimum pension was $35,000. Since then, the Public Service minimum wage has increased several times, but the Board has failed to adjust the minimum pension in accordance with the said regulation 4 (b). On the published figures, pensioners on the minimum rate have therefore been paid below the statutory minimum for substantial periods from 2021 onwards”, the letter from Ram to the NIB stated.
The letter pointed out that the 2026 National Estimates show the Public Service minimum wage at $102,346. Fifty per cent of that amount is $51,173, yet the published NIS minimum pension remains $43,075. Therefore, each minimum-rate pensioner suffers a monthly shortfall of $8,098.
“Nor is the default cured by a later increase. The subsequent adjustment of the minimum pension does not extinguish arrears which had already accrued. Equally, where a Public Service minimum-wage increase was made retroactive to the beginning of a year, the Board must identify the legal basis, if any, upon which the corresponding statutory pension entitlement was not adjusted from the same effective date”, the October 1st letter contended.
“We therefore call upon the Board, within seven days of receipt of this letter, to state its position on the underpayments from 2021 to the present, and to account fully for the amounts by which minimum-rate pensioners were paid below the statutory minimum”, the letter urged.
Having regard to its obligation under the said regulation 4(b), the letter said that the Board should identify every affected pensioner, calculate the arrears due, and make payment. If the Board disputes liability, it should state, within the same seven days, the precise legal basis on which it asserts that payment below the statutory minimum was lawful.
Under the NIS Act, the NIB functions subject to the supervision and control of the administration. This should be a straightforward matter. It would go against the historic Teemal ruling on pensions and the government’s oft-stated declaration of ensuring security for pensioners. The NIS should publicly pronounce on the contention of Mr Ram and the unions that have signed on to the letter.
Has the NIS complied with the tenets of amended regulation 4(b) of the Benefit Regulations? If not it then has to make good and take whatever steps are necessary to ensure that the affected pensioners receive their monies.
The government has made much of its investment in Hope and Justice centres and other mechanisms to improve facilities for the people of this country. It can’t rest easy if by negligence or incompetence it has failed to ensure that pensioners at the minimum rate get their due. We urge the administration of the National Insurance Scheme to act with awareness of its mandate and obligations as set out in its governing Act.
Discussion