Latest update November 8th, 2024 1:00 AM
May 28, 2024 News
Kaieteur News – Former Finance Minister Winston Jordan has criticised the government for its failure to address the plight of National Insurance Scheme (NIS) pensioners.
Jordan in a scathing letter published in the May 23, 2024 edition of the Kaieteur News highlighted the lack of compensation to the pensioners over the past three years resulting in a staggering accumulated loss of $92,496 per pensioner.
Jordan emphasized the disparity in treatment, noting that while other sectors saw increases, NIS pensioners were left behind. He pointed out that the NIS old age pension increased from $32,100 to $35,000 in 2020, but it wasn’t until 2024 that the government raised it further to $43,075. This increase came alongside raises for public servants, teachers, members of the disciplined services, constitutional office holders, and government pensioners from 2021 onwards.
In his letter Jordan recounted being approached by an NIS pensioner seeking clarification on why pensions have remained stagnant since 2020.
“Since I was not in a position to give him a satisfactory answer, I have decided to highlight this matter through this letter, in the hope that it generates immediate action by the concerned Minister(s),” the former Finance Minister said.
He stressed the adverse effects of this negligence on pensioners’ quality of life, stating, “Money has a time value… The basket of goods bought with $52,000 dollars in 2020 will cost substantially more in 2024.”
He lamented that pensioners are now forced to accept the new minimum pension without adjustments to maintain their previous standard of living.
Senior Minister in the Office of the President with Responsibility for Finance announced a 7 percent salary increase for all public servants and government old age pensions in 2021, 8 percent increase in 2022, 6.5 percent increase in 2023 and another 6.5 increase in 2024.
In response to this disparity, Jordan demanded decisive action from the government. He called for the removal of impediments preventing NIS from paying increased old age pensions and suggested providing relief financing.
“If NIS is being prevented from paying increased old age pensions above the minimum, then the Government must act decisively to remove the impediments and/or provide relief financing. I believe that the NIS is still a member of the Cooperative Finance Administration (COFA). I believe the COFA Act has not been repealed. This Act has provisions for the Government to meet any shortfall, in any financial year, of any of the financial institutions falling under the Act,” he said.
Further, the former Finance Minister said that even if the Act no longer exists “nothing stops the Government from transferring the necessary resources to NIS”. “This is being done, already, in the specific case of GUYSUCO, which benefitted from over $50 billion in transfers under the Coalition Government. The entity continues to be the recipient of billions of dollars in transfers, annually, under the current Government,” he said while noting that the APNU+AFC Coalition Government intended to transfer resources from the Natural Resource Fund (NRF) to the NIS, so that the Scheme can meet its obligations to its contributors, pensioners, and other beneficiaries.
“It will be recalled that the Scheme was similarly bailed out, in 2016, when a deal was signed for the Scheme to recover $5.6 billion it lost in CLICO in 2009,” Jordan said.
“NIS ceases to function as an effective social safety valve when beneficiaries are denied their rightful pension, after many years of contributing to the Scheme,” the former public officer said.
Nov 08, 2024
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