Four new initiatives to push ahead with urgent government-sought reforms to pension funds under the Social Insurance Organisation (SIO) were put on the table yesterday.
They are:* Pensions will not be lowered;* The retirement age will remain at 60 years;* Working between the ages of 60 to 65 will be optional and would see the maximum pension reach 90 per cent rather than the current 80pc; and* Expatriate workers would be enrolled into the pension system and their end-of-service benefits will be paid by the SIO.A government delegation headed by Finance and National Economy Minister and SIO chairman Shaikh Salman bin Khalifa Al Khalifa presented the initiatives to MPs and Shura Council members after an in-person meeting was moved online with six MPs testing positive for Covid-19.
The meeting was chaired by National Assembly and Parliament Speaker Fouzia Zainal.Shaikh Salman said the initiatives seeks to extend the lifespan of the pension funds, whilst also protecting the rights of pensioners and current contributors.Negotiations are set to continue on Sunday.
However, Parliament services committee chairman Ahmed Al Ansari said the initiatives were not enough.“We seek more for the people and for us to consider government reforms we need further initiatives,” he explained.“People need to know clearly what is at the end of the tunnel after serving decades in the private and government sectors.
”The government last year presented six reforms after projections showed the public pension fund would go bankrupt in 2024 and the private pension fund by 2033.
The six proposals were:* Reducing wages by 6pc for every worked year before determining a pension through a detailed calculation;* Setting the retirement age at 60 and voluntarily up to 65, although it would be possible to allow work beyond these years;* Calculating the pension on an average of the last five worked years;* Increasing monthly contributions gradually by 1pc from 2020 to reach 2.7pc;* Setting a minimum retirement age at 50; and* Cancelling ‘giveaway’ years.
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