PM seeks Opposition’s support for social pension reform

PRIME Minister Andrew Holness has called for the Opposition’s support for a social pension plan which is being promoted by the Government.

Holness told the first meeting of the new Parliament at the Jamaica Conference Centre on Tuesday that his Government’s success, since the start of the COVID-19 pandemic, cannot be limited to saving lives and keeping the economy going.

“Stop, just for a moment, and consider that in this pandemic this Government has been able to ensure the protection of the most vulnerable people. No doubt the pandemic has shown up weaknesses in our social safety net, and I believe it is now time, and I am certain that we will have co-operation in this regard, that we need to have a reform of our National Insurance Scheme (NIS) to ensure that it is more robust and that it is protective,” he told the Parliament.

“We need to reform our NIS system to ensure that there is near universal participation. We have committed to a social pension (plan) for those persons who are senior and retired: Who have no coverage at all. We have committed to reforming all the social taxes, to make it easier to be paid and those reforms will require the Parliament to participate in these consultations,” he said.

“It may even require parliamentary committees to work on developing the policies and, therefore, I signal now, that we will need the co-operation of the Opposition in carrying through these reforms,” Holness added.

In his March budget speech, Minister of Finance and the Public Service Dr Nigel Clarke told Parliament that the Government would be reforming the NIS, with phased in increased contribution rates and thresholds, which were initially announced in the 2019/20 fiscal year.

He said that these reforms will ensure that the NIS has positive cash flows until 2048, and the fund will last until 2057.

Dr Clarke said that to extend the life of the fund beyond this would require further reform, which will be addressed by the Ministry of Social Security at a later date.

In the meantime, he said that the Government was concerned about the low coverage of the NIS, as out of a population of 291,373 elderly (over 65) persons only 82,063 —less than 30 per cent — are in receipt of an NIS pension.