Senate finally passes Pension Bills

Senate finally passes Pension Bills

Saturday, September 30, 2017

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THE Senate finally passed two Bills yesterday, facilitating the implementation of Government’s long delayed reform of public sector pensions.

Passage of the Bills has eased some pressure on the Government to respond to the urging of the International Monetary Fund to have both the public sector pensions and salary increases issues resolved, and the Government’s move on the decade-old issues of public sector transformation, with urgency.

Under the new provisions, pensionable public sector workers will start contributing five per cent of their salaries to a segregated pension fund, as of April 2019. The fund is to be established by the Ministry of Finance and the Public Service and is considered critical to the availability of funds for investments especially geared to Government’s growth targets.

The retirement age within the service is to be gradually increased to 65 years old.

The amended Bills will also harmonise legislation governing public sector pensions in a single statute and repeal several legal enactments dealing with pensions.

The Bills — the Pensions (Public Service) Act, 2017, which gives effect to the reform process, and the Constitution (Amendment) (Established Fund) (Payment of Pensions) Act, 2017, which addresses the Constitutional changes — were passed with the support of members on both sides of the Senate.

However, Opposition Senator Lambert Brown abstained on the vote for the constitutional changes, which required a division in which each member voted, separately.

Amendments yesterday included changes dealing with deductions from the salaries of public servants during periods when they are on part salary, and a requirement that the board shall make investments in institutions licensed by the Financial Services Commission, and that deposits should be placed only in institutions which are licensed under the Banking Services Act.

An issue raised by Opposition member Senator KD Knight, on the effect of the provisions for district constables who are likely to be recruited into the Jamaica Constabulary Force will have to await a response from the minister of national security.

The Bills were passed with 62 amendments, five months after they were tabled in the Senate. They were passed in the House of Representatives with 38 amendments on April 5.

They were piloted through the Senate by Senator Kamina Johnson Smith, Leader of Government Business.

Leader of Opposition Business Senator Mark Golding was the main spokesman for the Opposition in the debate.

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