Proposed Public Pension Formula Makes Bad Situation Worse
The following important comment was posted by Actuary and Talk Show host Walter Blackman to respond to a comment raised on the blog 60 Love Can Lose – Blogmaster
Pensions have surfaced as an extremely important issue at this stage of our national development, so I want to commend you for bringing this pension-related matter to the attention of BU readers.
The challenge for me is to distil esoteric, actuarial and mathematical concepts into information that you and all BU readers can understand. Please forgive me if I fail to overcome that challenge
We grew up hearing that one of the major benefits derived from working for the government was the receipt of a pension and gratuity.
I will use a 5-year average pay of $5,000 (assumed to be under the NIS ceiling, for illustrative purposes only). I simply want to show how the changes in pension legislation have affected government workers hired before September 1, 1975, those hired on or after September 1, 1975, and those to be hired on or after January 1, 2023.
A person born on January 1, 1945, who was hired before September 1, 1975 and who retired after 33 1/3 years of service will receive the following:
- Government pension = $3,333.33
- NIS Pension = $3,000
- Total Pensions received = $6,333.33
Note that this pensioner is receiving a total monthly pension which is greater than the pay he was getting as an active worker.
This was a problem that the government decided to solve.A person born on January 1, 1945, who was hired on or after September 1, 1975 and who retired after 33 1/3 years of service will receive the following:
- Government pension = $333.33
- NIS Pension = $3,000
- Total Pensions received = $3,333.33
Note the drastic reduction in government pension. This was not the best approach to be taken by the Government of Barbados to solve the pension problem.
A person born on January 1, 2003, who will be hired on or after January 1, 2023 and who will retire after the following years or less of service will receive the following:
- Government pension (1-36 years of service) = $0
- Government pension (37 years of service) = $$83.33
- Government pension (38 years of service) = $166.67
- Government pension (39 years of service) = $250.00
- Government pension (40 years of service) = $333.33
This proposed pension formula makes a bad situation worse. The unions ought to make their voices heard.
Note:
Gratuity = 25% x monthly pension x 150
Pension to be paid = 0.75% of calculated pension
For example:
Government Pension = $3,333.33 per month
Gratuity = $125,000.00
Monthly Pension to be paid = $2,500.00
Barbados Underground 
Bush Tea
June 26, 2022 4:58 PM
“@ Walter
Bushie took your cussing in good spirit …and it was well worth it so far.
You ARE a true national asset…..
BUT watch YOUR donkey… cause if yuh slip back…yuh slide with the bushman.”
Bush Tea,
You know how life goes. I am a mere mortal and will certainly make mistakes. When I do, I expect you to bring down the hammer (or the whacker, your choice), and hit me with your best shot. Your lashes will make me better if I am interested in improving.
As Bajans say, “tongue and teet’ will have words”. You, Miller, Caswell, Hal Austin, some others and I are “tongue and teet'” and we certainly do have words from time to time.
However, when the dust settles, there is a bond of love and appreciation that man, time, the DLP, nor the BLP can ever erase.
Up and on, my friend.
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Critical Analyzer
June 26, 2022 2:10 PM
“@Walter
Go read my contribution comment at June 26, 2022 9:27 AM. That is two solutions there.”
Critical Analyzer,
No disrespect intended.
As we speak, the NIS of Barbados is in serious disequilibrium and reform is urgently needed. I know and you know that your recommended solutions can become the launching pad for a serious intellectual discussion, but nothing more.
It is customary for the powers that be to use all or some of the following policy tools:
Increase contributions
Legislate a change in the benefit formula so as to reduce benefits (benefit cut)
Increase the NIS Normal Retirement Age (benefit cut)
It would surprise me if they were to force workers to work for more than 10 years before they qualify for an old-age pension benefit.
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David
June 25, 2022 8:07 AM
” We increase the immigrant population to help with increasing new jobs and tax base?”
David,
I have conservatively estimated that we have at least 50,000 Barbadians age 15 – 64 who are currently unemployed. No one seems to care about them.
How would an increased immigrant population provide jobs for themselves and our 50,000 unemployed Barbadians?
By the way, are these black people that the Government of Barbados plans to bring in? Where are they coming from? Africa? Haiti? Can you easily spot tongue-in-cheek questions? LOL.
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@Walter
Isn’t the idea floated to attract immigrants with new skills to grow GDP.
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David
June 26, 2022 11:36 PM
“@Walter
Isn’t the idea floated to attract immigrants with new skills to grow GDP.”
David,
All I can say is that the idea is being floated with increased frequency. No details are being given.
Instinctively, I believe that we are going to see citizenship by investment whereby wealthy foreigners will pay a high fee to government to become citizens of Barbados. Black Barbadians will be pushed further down the social totem pole and will become members of a frowned upon “lumpen proletariat” in their own country.
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@Walter
Hope CBI never comes to Barbados.
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Drastic pension cuts are highly welcome to make our island fit for international finance capitalism. Taxes and social transfers must go down, corporate profits must go up.
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I am looking at some of the fixes that were suggested and the phrase “The operation went well, but the patient died” comes to mind.
—-x—+
CBI is already available in several of the islands. It rings with it a new set of problems
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Bad idea, CBI. Indeed it will bring with it certain challenges, especially if the investors are of a certain hue.
No, no, no! “Not bout heh!” We know how that story goes.
Nuff nuff “white” men in top positions. Nuff nuff black people in low paying positions.
In de new republic?????????
Barbados fuh sale!
Quick fix! Terminal mash up!
Promote and assist black businesses to grow and spread their wings.
It can be done with some effort.
And a change in mindset.
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Donna & David,
I hope my instincts are wrong. The government keeps hinting that it plans to bring in people. Yet, we are getting no demographic analysis. No mention of age groups that will be targeted. No major institutional, infrastructural, nor resource adjustments.
One cannot help but sense that the decision will be foisted upon us with no participation or discussion. I do not want CBI. You do not want CBI. Yet, so far, CBI is the most likely approach, given the antics and behaviour of the government.
Do you know if the citizens of other Caribbean islands with CBI wanted it?
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David
Donna’s comments about businesses reminded me of Simpson Motors &
Interamericana Trading Corporation (ITC) sale to the British multinational automotive firm, Inchcape International Holdings Ltd., which created an interesting development.
Inchcape have international distribution rights for Toyota & Lexus [Nassco]; Audi, BMW, Ford, Jaguar, Kia Mazda & Mini; [ANSA Motors (Barbados) Ltd.]; Fiat, Hyundai, Infiniti, Nissan [Courtesy Garage]; Honda [Platinum Motors].
Management of those automobile dealerships believe the British firm may use Simpson Motors to introduce the above mentioned vehicles to the local market, thereby giving them direct competition in the process.
However, the FTC approved the sale…… and, in an effort to protect the local dealerships, Inchcape will be REQUIRED to “notify the Commission if it plans to introduce any new brands to its portfolio of offerings that are already represented in Barbados.”
Citizens…… and owners of used vehicles dealerships, are allowed to import various models of used cars, SUVs, vans, trucks and buses
Interestingly, Inchcape ALSO sells used vehicles as well.
The ‘$1M question’ is, how will the FTC go about protecting the used vehicles industry?
How about the plan to introduce electric vehicles?
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@Artax
As you know Simpsons although based in Barbados has a regional footprint. Decisions made about this company one suspects will be flavoured by this consideration. Notwithstanding consumer legislation in place.
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Artax
You lost me. If the used car market is already a ‘free for all’ (as it is in many places), what is there to protect.
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@WB
We’re the people consulted on changing to Republic. Or had been spoken of so often, it was accepted it would happen ‘eventually’.
When the GoB opted to exchange cash from the NIS for Govt Paper were the citizens consulted.
Herein lies the authority of the elected.
I noted in a recent review of immigration stats (Canada), a very large percentage from African nations claiming persecution based upon sexual orientation. And some were very educated. Minimal procreation happening here.
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William,
White “saviours” of the capitalist kind only mean to “save” themselves.
This we know. How the hell can we talk about charting a new path of dignity in a new republic with our feet still mired in the muck of the old ways?
This citizenship by investment thing is not charting a new path of dignity unless we are forging links with our ancestral home. It is more prostitution, not of the hotel room kind but of the street kind.
Eighty thousand “white” people of the monied kind would change this country significantly and place the average Bajan permanently under their feet.
I would be fine with the plan if I did not know the average MO of the white capitalist kind.
But we have centuries of evidence to go by.
I would rather eat Bushie’s coconut and breadfruit every day, wear crocus bag, live in a grass hut and travel by donkey cart!
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@ Artax
It would not be a job for the FTC it would be left to the manufacturers like Toyota etc to outline the territory for distribution as per the distributorship agreement with each agent.
So in Barbados Nassco is the agent for Toyota. Simpson motors could not go and sell Mercedes in Florida for example as there is an appointed distributor in Florida already. These lines all have appointed distributors by territory for their new car sales. Now when it comes to used that is a different matter.
It will be left to be seen how well the manufacturers choose to protect their local agents.
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NorthernObserver
June 27, 2022 10:21 AM
“@WB
We’re the people consulted on changing to Republic. Or had been spoken of so often, it was accepted it would happen ‘eventually’.
When the GoB opted to exchange cash from the NIS for Govt Paper were the citizens consulted.
Herein lies the authority of the elected.”
NorthernObserver,
The answer to your questions is “No”. Then again, your questions were meant to be rhetorical. Point made. Point taken.
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David
June 25, 2022 4:15 PM
“@Walter
The NIS Board report to a BOD and to Cabinet?”
David,
As far as I know, the NIS Board reports to the Minister of Labour & Social Security.
There is an NIS investment committee which is tasked with formulating an investment policy and strategy. This committee has no teeth. No power.
The Minister of Finance is the sole person/office endowed with the power to determine how NIS funds are actually invested. Consequently, the various Ministers of Finance are primarily (Not totally. Poor administration also plays its part) responsible for the collapse of our NIS, should any collapse ever occur.
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Well if it does collapse I would say 2 MOFs in question should hold most the licks! Lol
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Donna,
A person born on January 1, 2003, who will be hired on or after January 1, 2023 and who will retire after 36 years of service will receive the following:
Average salary = $5,000 per month
Government pension (36 years of service) = $0
Now let us look at a person who is working for an average salary of $10,000, and is also hired on January 1, 2023.
For this person:
Government pension (36 years of service) = $3000.00 per month
Clearly, a person working for $10,000 per month would receive a government pension of $3,000 per month after 36 years of service, whilst his co-worker who works for only $5,000 per month will receive no government pension at all.
A pension plan for civil servants in Barbados should never have a formula designed to provide benefits that discriminate in favour of highly paid employees.
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John A
June 27, 2022 2:00 PM
“Well if it does collapse I would say 2 MOFs in question should hold most the licks! Lol”
John A,
I find your response quite interesting.
From my standpoint, I would say that 2 MOFs should hold little or no licks – Errol Barrow and Tom Adams!
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A person born on January 1, 2003, who will be hired on or after January 1, 2023 and who will retire after 36 years of service will receive the following:
Average salary = $5,000 per month
Government pension (36 years of service) = $0
NIS Pension = $3,000 per month
The NIS pension is to be viewed as a minimum floor of income. It is supposed to be supplemented by an employer pension, and personal savings. This concept is known as the 3-legged stool.
The proposed government pension formula will restrict a civil servant to only an NIS benefit after 36 years of service. This minimum floor of income, as provided by the NIS, is inadequate for retirement income purposes.
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@ Walter
Yes we will spare the rod on Errol and Tom. Those early fellows didn’t seem to see it as the states piggy bank like some of the recent ones.
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@John A
Not so fast!
What was the % of government paper NIS held under the two gentlemen you are lavishing praise?
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“It would not be a job for the FTC it would be left to the manufacturers like Toyota etc to outline the territory for distribution as per the distributorship agreement with each agent.”
John A
Surely, Nassco as the agent for Toyota, for example, would have to be fully aware of the terms and conditions relative to their territorial distribution agreement with the manufacturer.
So, perhaps you may want to explain why did management of new vehicle dealerships expressed their concerns and complained to the FTC……. if what you’ve outlined in your above comment is true?
Why did the FTC respond accordingly?
Why would the FTC intervene in an issue, which you seem to be implying that does not fall within its remit,?
Another consideration is the fact that Toyota, Nissan, Hyundai, Honda, Mazda, Mini etc are also manufactured in the UK.
And, Inchcape has international distribution rights for those vehicles…… while Nassco, Courtesy, Platinum Motors, ANSA Motors etc import their vehicles from Japan.
~~~~~~~~~~
NorthernObserver
Yes, I agree the importation of used vehicles is a “free for all.” But, the small used car outlets have competing fairly amongst each other.
I remember during the 1990s when the used car industry was at its ‘zenith,’ Nassco, as the official distributor of Toyota, decided to enter that market and imported used Toyotas as well, which was met with protest from local used car dealerships, for reasons of unfair competition and subsequent demise of their businesses.
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Mr. Blackman
I understand that persons entering the public sector after September 1, 1975, would not be entitled to both government and NIS pensions, which essentially means they would be entitled to NIS pension only.
Recall that a few retired, ‘appointed’ National Assistance Board employees were receiving pensions from NAB and NIS, with government subsequently ceasing the pension from NAB.
Your made the following calculations:
Government pension = $333.33
NIS Pension = $3,000
Total Pensions received = $3,333.33
My question is, if those persons are NOT ENTITLED to BOTH pensions, why did you calculate for a government pension?
It would interesting to see the guidelines you used as a basis for those calculations, for my education.
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Artax
But car dealers sell both new and used? They need manufacturer approval to sell new, but can’t anybody sell used?
Wasn’t there a story on BU months back, where someone bought a used car, Kia I think, from a dealer who was accused of misrepresenting the car. Sounded like they sold both new and used, and were aware of the vehicle history.
It ‘sounds’ as though you seek to limit used vehicle sales to those who do not sell new.
In N.A. where a new car can mean a 1yr wait, the dealers used business is keeping them afloat.
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@ Artax
With my years of dealing with grey market sales the matter was always dealt with between distributor and manufacturer. Its a matter of territory and whether an “exclusive ” distributor agreement was in place.
Anyhow don’t let’s cross tracks here on the Issue being addressed. Don’t want David cuss me for being off topic. Lol
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@ David.
The amount of government paper as a percentage of total portfolio held I bet would be no where near what it is now. Remember we are talking percentage wise not dollar value.
What I can say is that in the Errol and Tom era these men respected the NIS for what it was. In other words the peoples pension money. The assault on the fund that I have seen in the last 15 years or so would never of happened then under those guys. Also this nonsense we see now of no audited financials being supplied for years would never of flown with them either. Barrow often referred to the fund as ” the peoples retirement money.”
We just seemed now to have decided laws are for others. We cuss the ZR men and the motor bike men for not respecting the law, but tell me have our leaders set a good example of adherence over the last 15 years or so?
The goverent piggy bank approach towards the fund seems to of crept in over the last 2 decades or there abouts. But ask yourself this. Did we as a people ever challenge them for doing so?
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TLSN,
Your asshead thinks that Donna is still working??????
And spending so much time on BU?
Lol.
My son is currently working for six overseas clients. One youtuber with 4 millions views on each video decided on Barbados rather than Jamaica for his holiday, just because of their link up online.
So you can stop there and talk shite about my eighteen year old son who has been making money in this field since the age of thirteen and got his first overseas client at sixteen.
Ever heard of Kendrick Lamar? Well there is this Bajan girl who was recently featured on one of his releases. Had hits with her former band Cover Drive up your side. Amanda Reifer is her name. When I showed the news item and her picture to my son, he said, “Oh, her? Somebody asked me to help them with something for her a few years ago. I didn’t have to do a whole lot though.”
So sorry to disappoint you but my son got my creativity and his father’s technical skills.
What a piece of work you are!
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Artax,
There is a good reason for Walter doing that which I cannot articulate at present because I am sleepy. I’ll leave it for him to do so.
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Walter BlackmanJune 27, 2022 1:48 PM
You have stated this before. And where the organizational lines get hazy.
I “believe” the Board of Directors report to the MoL&SS. The NIS employees are a unit of the Civil Service, to whom does the MD/CEO report? The Board or the MoL&SS, or ______?
The Investment Committee is referenced in the Actuarial Review, but not identified, so one is unsure if this is a sub-group of the BoD or some other appointees. In any case, the Audit has noted, their recommendations have not been followed.
The Ministry of F has one board seat, as well as one seat for the DoF.
Interestingly all Actuarial Reviews prior to the last one, were sent to the Board Chair, who in turn sent the Review to the MoL&SS, or equivalent in prior years. The last review was sent from the Board Chair to the MoF!!!
Was this unintentional?
It is this “dotted line” influence of the Ministry of Finance which causes a cloud.
We rarely hear the MoL&SS talking about the NIS in any depth. Similarity true for Dr. Byer who preceded him.
It seems this organizational structure is intentionally prone to obfuscation?
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@ Walter Blackman June 27, 2022 2:35 PM
What about the highly paid senior civil servants, aka PS, Managers, etc. Will they be limited to the same $3,000 NIS pension too and if so have they already started investing in private pension plans and investments as I can’t see them living on $3,000 and no government pension?
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Northern ObserverJune 27, 2022 3:41 PM
RE: “Wasn’t there a story on BU months back, where someone bought a used car, Kia I think, from a dealer who was accused of misrepresenting the car. Sounded like they sold both new and used, and were aware of the vehicle history.”
Yes, was a Kia vehicle, which are sold by ANSA Motors, and resold by their used car outlet, Carmax.
RE: “It ‘sounds’ as though you seek to limit used vehicle sales to those who do not sell new.”
Now, “YOU have me lost.”
How could you interpret my mentioning of an issue that occurred in Barbados a few years ago…… to mean I am “seeking to limit used vehicle sales to those who do not sell new.”
Come on, my friend, I EXPECTED a much better response from you.
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John A June 27, 2022 3:41 PM
Perhaps you purposely or conveniently ‘side tracked’ my question as to why would FTC intervene in an issue for which it does not have remit.
RE: “Anyhow don’t let’s cross tracks here on the Issue being addressed. Don’t want David cuss me for being off topic. Lol…:
I believe that is a ‘cop out.’
There are some individuals that present different versions of the same irrelevant contribution, irrespective of the topic being discussed, until they eventually ‘hog the show.’
We’re only ‘discussing’ a minor issue that would not distract from the substantive topic in any significant way.
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Artax
The ‘$1M question’ is, how will the FTC go about protecting the used vehicles industry?…”for reasons of unfair competition”
I was reaching….and it wasn’t related to the Kia car issue, that was to establish the same entities sold both new and used…..for I am still lost what is to protect in the used car industry. If not the smaller dealers vs the larger dealers.
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Agree with Artax, it is not a digression to clarify how a regulator should or is not operate in a market to ensure laws are adhered and a single player does not monopolize.
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NorthernObserver
My comments relative to the “$1M question,” were BASED on the issue with Nassco and used car dealers.
I only MENTIONED WHAT OCCURRED.
Perhaps YOU should ask the used car dealers WHY they PROTESTED at that time and WHOSE interest were they seeking to PROTECT, when they did so.
It was interesting to note that, as a result of the protest, Nassco ‘STOPPED’ selling used cars.
I’m not the person you should be ‘pointing fingers at.’
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Wuhlaus! I still laughing at how TLSN got muh class up!
Poor, destitute Donna wukkin’ till she drop and she son scratching bout begging de white man fuh piece uh wuk, tie to de 2×3, cyan reach nuh furda.
And all the while Donna is lying in bed relaxing, AS USUAL and her son is sitting comfortably in cyberspace reaching into the wide wide world and bringing it home.
Suggesting that people tend to assume what they would like to be.
BU is a good place to learn about humans.
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@Artax
There is/was a massive problem with invoicing discrepancies. Also licensing office has been having a problem keeping track. With new systems being implemented this may not be an issue.
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@ Artax
There in no cop out. I personally don’t see the FTC being involved here. This is a matter of distribution rights and territory. This has to be addressed between the manufacturers and their appointed distributors when it comes to new cars.
The second hand cars however are a different story as anyone can buy a second hand car from anywhere and import it. So Toyota say and Nassco would need to sort the issue out if this other company tried to intervene in the local market with Toyota.
The other issue too is we as the consumer would need to decide where our loyalties lie. I personally don’t see this as being an issue we should worry over.
For example Simpson Motors had the right to sell Suzuki throughout a large part of the region. They did not however have the same right to sell Mercedes throughout the said entire region. While this foreign company may represent many brands found here in other countries, that does not mean they will have the right to sell in our territory.
What the local representatives need to do is make sure their contracts are well sewn up with the manufacturers and not expect the FTC to protect them.
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@John A
The FTC has to be concerned with the level of concentration of ownership, control and influence of players in a market. It is their role.
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The situation in Barbados isn’t going to improve anytime soon
Meanwhile
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Home / Local News / ‘Put digital ID on pause’
‘Put digital ID on pause’
by Sandy Deane March 2, 2021
A University of the West Indies law lecturer Monday called for Government to put the brakes on the Barbados National Digital ID set to roll out soon and rethink the bill governing it, claiming it is an intrusive government’s “assault on liberty”.
Dr Ronnie Yearwood argued that the national identity register proposed under the Barbados Identity Management Bill “looks like an assault on liberty, and an unnecessary instruction by the government in the collection and use of personal data.”
Last Tuesday, Attorney General Dale Marshall in tabling the bill in the House of Assembly said: “A computer chip containing an individual’s fingerprint, driver’s licence and other personal data are to be included in the pending Barbados Digital ID and National ID Card.
Marshall gave an assurance that the data on the chip would be protected and would only be shared with whom the holder allows to access the information.
But Yearwood, also an attorney-at-law, said he found the bill “troubling” on several grounds.
He first took issue with the AG’s disclosure that the card could have one’s fingerprint if so desired.
Marshall had told the House: “The last administration wanted to make fingerprint mandatory. The last administration wanted to introduce a new ID card but one of the hallmarks of what they were doing is that you had to give your fingerprint at all times.
“And in opposition, we took the position no .. this is not a police state and we cannot agree as a responsible political party representing Barbadians that we needed to give this kind of data. And now that we are in Government and have the opportunity to put these things in place, our position is that you can give your fingerprint if you wish but you cannot be compelled to do so.”
Dr Yearwood challenged Section 12 of the bill which states that “where a person is unable to produce his identification card, the person authorised to require such identification shall, unless another form of identification is authorised by law, defer consideration of the person or refuse access until such time as the relevant identification card is produced”.
He said: ”This is not something to be taken lightly because in effect it says that an individual is not presumed to be who they are until they can prove so with the ID. It looks like a shift of power from the individual to the government, and not only a shift but a control of data, surrounding proof of who an individual says they are. This feels very much like the surveillance, police-type state that the AG had problems with when in Opposition, his words not ours.”
Dr Yearwood went on to question suggestions from the AG that the new ID would significantly reduce opportunities for fraud, citing recent local reports of a list that carried personal information such as the names, addresses and COVID-19 statuses of close to 150 people making the rounds on social media sites WhatsApp and Instagram. He also pointed to the recent beach of Jamaica’s JamCOVID app and website which exposed quarantine orders on more than half a million travellers to the island.
He said: “Governments in the Caribbean, most recently as reported in Jamaica where the immigration website was breached, have not showered themselves in glory when it comes to data security. We have no reason to believe that Barbados, like other Caribbean countries, is not the same. Take our own issue where it appeared that there was a breach of data regarding COVID patients. Should we be comfortable with massive data collection and centralization by the Government?”
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2019
The Constitutional Court of Jamaica has struck down the country’s mandatory biometric National Identification and Registration Act and the National Identification and Registration System (NIDS), ruling three to none that it violates constitutional privacy protections.
The law required all Jamaicans to register biometric data and obtain a NIDS identity card, which would be needed to access government services, and also used for KYC and other business practices. What biometrics would be used, however, had not yet been determined. A panel consisting of Chief Justice Bryan Sykes, Justice David Batts and Justice Lisa Palmer Hamilton ruled in favor of a legal challenge brought by Julian Robinson, general secretary of the People’s National Party (PNP) on behalf of himself, his constituents, and the party. Robinson claimed that several constitutional violations were included in the act
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John A
I’ll invite you to read the article entitled, ‘FTC okays sale of automotive companies,’ on page 5 of the Friday, June 24, 2022 edition of the ‘Weekend Nation,’ before going any further with this ‘discussion.’
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@Artax
I remain confused as to the issue re:used cars.
As I said, I was reaching.
Cars are simply a product, not made in Barbados, like Kellogs or Heineken or motorcycles etc
I don’t grasp the issue between new car dealers and uses.
Here, it is financing. But they piece that out to finance companies.
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@ Artax
The entity bought Simpson Motors who sell certain brands in Barbados. They have a right to continue selling said brands, either new or in second hand form. If they decide to start selling new Nissans or Toyotas that is a job for the local companies attorneys based on what rights were given to them which predate the Simpson sale. If exclusive contracts were not given then its an open market. For example they are 2 agents for Hyundai in the Barbados. One sells cars and the other sells their trucks. This occurred because the initial Hyundai agreement never spoke to heavy duty vehicles.
I do not see the FTC getting involved in this. It is a legal matter revolving around issued rights to distribute certain brands owned by manufacturers. If the contracts are weak and have not been revised for years, then that is a matter for the local companies, their attorneys and the manufacturers. The same FTC will have to request this said documentation before they too could make a ruling.
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The issue around new and used car dealers has to do with valuations for financing and insurance purposes.
Used car importers had to go to the authorized dealer for valuations were those dealers were accused of undervaluing cars especially those with unique features not available locally because they, the dealer did not sell them originally.
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Critical Analyzer June 27, 2022 6:11 PM #: “The issue around new and used car dealers has to do with valuations for financing and insurance purposes.”
CA
Perhaps what you outlined was an issue in the past.
NOT ANYMORE.
Importers of used cars can obtain valuations and road worthy certificates from reputable garages that are authorized to do so.
Insurance companies, financial institutions, credit unions and banks accept valuations and road worthy certificates from various garages such as, Corbin’s Garage, Trans-Tech Inc., Turton’s Garage, just to name a few.
Some Insurance companies include an approved list of garages that provide those services, with insurance renewal notices.
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John A
I asked someone who has intimate knowledge of FTC’s operations a few questions.
And was told that such sales or mergers must be first investigated by the Commission’s Fair Competition section before approval of the sale/merger is granted by the Commissioners.
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@ Artax
I f the FTC had to investigate the sale for concerns over potetial market monopoly that is fine. What I am saying is that if the new entity started selling Toyotas or Nissans it would be a legal matter of distribution rights and territory, not a fair trade issue in my view. It would have to be settled between attorneys, distributors and manufacturers. I don’t see the FTC being party to that type of distribution rights dispute that’s what I am saying.
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John A
“However, in an effort to ensure the future survival of Barbados’ other automobile dealerships, the regulator has revealed that Inchcape International Holdings Limited will have to “notify the Commission if it plans to introduce any new brands to its portfolio of offerings that are already represented in Barbados.” (Nation News, June 24, 2022)
My concerns are based on the above comments.
Are you implying that by REQUIRING Inchcape to “NOTIFY the Commission if it plans to introduce any new brands to its portfolio of offerings that are ALREADY REPRESENTED in Barbados,”……
…… the FTC essentially became caught up in an issue that DID NOT fall WITHIN its REMIT?
It’s a simple question that requires a ‘YES’ or ‘NO’ answer.
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Artax
June 27, 2022 3:30 PM
“Mr. Blackman
I understand that persons entering the public sector after September 1, 1975, would not be entitled to both government and NIS pensions, which essentially means they would be entitled to NIS pension only.”
Artax,
Not quite.
I gave the example of such a person retiring after 33 1/3 years, with an average pay of $5,000 per month:
The NIS pension (max = 60% of pay) is calculated based on whether the person is born in or before 1946, in or after 1956, or in-between those years.
The year of birth for this case is before 1946
Thus, the NIS pension = 40% x avg pay + 1% x avg pay per year, after 10 years
NIS pension = (40% + 23 1/3%) x avg pay = 63 1/3% of avg pay. But the maximum is 60% of pay
NIS Pension = 60% x 5000 = $3,000
Government monthly pension :=
2% x 33 1/3 x 5000 – NIS pension
Government monthly pension := $3,333.33 – $3,000.00 = $333.33
Therefore, this participant gets two pensions.
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Artax
June 27, 2022 3:30 PM
“Mr. Blackman
Recall that a few retired, ‘appointed’ National Assistance Board employees were receiving pensions from NAB and NIS, with government subsequently ceasing the pension from NAB.
Artax,
You did not say that these employees were medically boarded and retired medically unfit, so I have to search for a different explanation.
A worker at the NAB could retire anytime between ages 60 and 65. The NIS pension is only taken away from the government pension when the employee actually starts to receive the NIS monthly pension
So an employee retiring at age 60 will receive a NAB pension until age 67, when the NIS pension kicks in. If the NIS pension is greater than the NAB pension, then the NAB pension should cease.
You said the employees “were receiving pensions from NAB and NIS”. Could it be that NAB was simply tardy in stopping the NAB pension cheques for these employees after the NIS pension had kicked in?
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Mr. Blackman
The NAB issue was used as an example and not one that would require an explanation. I’m fully aware of everything you outlined in your above contribution.
My question is as follows. If any individual employed by the public sector after September 1, 1975 is NOT entitled to both pensions, why did you calculate a government pension?
By those calculations, are you suggesting if a person decides to retire at 60 years old, he/she would receive a government pension of $333.33 UNTIL 67 years old, and then thereafter, a NIS pension of $3,000?
As it relates to the NAB, a few retired employeess were receiving both pensions, in some cases as long as 17 years, although they were entitled to one.
My concern was, why did Mia Mottley abruptly stopped payment of the NAB pensions, WITHOUT PRIOR NOTICE, to a ‘handful’ of senior citizens, whose living standards would’ve been based on their income?
Ironically, Cynthia Forde, who was the Minister at the time, claimed she did not know anything about it. Mottley’s elderly father would have benefited from the tax write-offs. And, Dame Antoinette ‘Billie’ Miller is being rewarded, at taxpayers expense, for some irrelevant post called, ‘Ambassador at-Large.’
But, this is a topic for another discussion.
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@ Artax
In is not a yes or no answer.
My final reply is that if they offered brands already represented that is a matter for the law courts, the lawyers and the affected parties.
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John A
In Bajan parlance….. ‘I wid you and dat.’
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Artax
June 28, 2022 7:09 AM
Mr. Blackman
“…… any individual employed by the public sector after September 1, 1975 is NOT entitled to both pensions,”
Artax,
This statement is false.
I have demonstrated to you in my comments above that it is possible for a civil servant, hired after September 1, 1975, to receive an NIS and a government pension.
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Artax
June 28, 2022 7:09 AM
“Mr. Blackman
………are you suggesting if a person decides to retire at 60 years old, he/she would receive a government pension of $333.33 UNTIL 67 years old, and then thereafter, a NIS pension of $3,000?”
Artax,
No.
Each individual case is different. Please note the conditions below which apply to our individual.
I am saying that if a person, born in or before 1946, hired on or after September 1, 1975, retires at age 60 with a 5-year average pay of $5,000 per month, after having worked 33 1/3 years, then he would receive the following:
A government pension of $3,333.33 from age 60 to age 67
A government pension of $333,33 from age 67*
A NIS pension of $3000.00 from age 67**
*Since he receives a NIS cheque of $3,000 at age 67, the government pension would now drop to $333.33 at age 67 ($3,333.33 govt pension – $3,000.00 NIS) due to the principle of abatement.
**This example is for illustrative purposes only. Technically speaking, an individual born in 1946 would not have to wait until age 67 to receive a full NIS pension.
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Mr. Blackman
I am not understanding the logic behind your examples.
I understand that persons joining the public sector after September 1975, would no longer receive two pensions, as you illustrated in your FIRST EXAMPLE.
I understand if a guy retires at 60 years he would receive a government pension until 67 years old.
But, if he applies for his NIS pension at 60 years as well, wouldn’t he lose 0.05% until he reaches 67 years old?
If you read my first contribution, you would’ve realized I ‘said’ it would interesting to see the GUIDELINES you USED as a BASIS for those calculations, FOR MY EDUCATION.
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@ Artax
Try this formula. He receives his full pension from GoB until he qualifies for an NIS pension. When he qualifies for a NIB pension ,his GOB pension is reduced by his NIB pension. In total he receives the same quantum. That is how it operates in the private and state corporations pension schemes. The NIS pension cannot provide livable pension for those above a certain income bracket. I hope this is more logical/understandable.
There is a ceiling to the amount the NIS ensures a pension regardless of the employees current income..
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Mr. Codrington
What I’m aware of…… and I don’t know of any recent changes, is that if a guy receives a government pension if he retires at 60, and at 67 his NIS pension is less than his GP, he would receive the NIS amount and government would pay the difference.
For example, GP = $1,000 and NIS = $975, then government would pay $25.
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Artax
June 28, 2022 10:29 AM
“Mr. Blackman
I am not understanding the logic behind your examples.
I understand that persons joining the public sector after September 1975, would no longer receive two pensions, as you illustrated in your FIRST EXAMPLE.”
Artax,
This concept gives people a lot of trouble, so I understand the difficulty you are experiencing.
Vincent Codrington has nailed it.
To determine the amount of government pension payable at any point in time after retirement, use this formula:
Government pension payable at any point in time after retirement = Gross Government pension calculated – NIS Pension being actually paid (NIS abatement)
Where
NIS abatement = 0 for civil servants hired before Set 1, 1975
Gross Government pension calculated = 2% x years of service (max = 33 1/3) x 5 yr avg salary for civil servants (not statutory Boards) hired before Jan 1, 2023
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Mr Blackman
Isn’t Mr. Codrington’s comments similar to those I made in my June 28, 2022 6:10 contribution?
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“He receives his full pension from GoB until he qualifies for an NIS pension. When he qualifies for a NIB pension ,his GOB pension is reduced by his NIB pension. In total he receives the SAME QUANTUM.”
But, Mr. Blackman’s calculations indicated the individual would receive less and not “the same quantum.”
Anyhow, there won’t be a need for further explanations. I’ll conduct my own research.
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@John A
This old paper coauthored by now Governor of the Central Bank in 1985 shows asset structure of the NIF.
Click to access WP1984-02.PDF
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Artax
June 28, 2022 10:29 AM
“Mr. Blackman
I understand if a guy retires at 60 years he would receive a government pension until 67 years old.
But, if he applies for his NIS pension at 60 years as well, wouldn’t he lose 0.05% until he reaches 67 years old?”
Artax,
Let us apply the formula for this case and see how it works.
Gross Government monthly pension at age 60 = $3,333.33
NIS pension payable at age 67 = $3,000
The employee decides to take his NIS pension at age 60. You correctly stated that the NIS pension is reduced by 0.05% per month, so NIS payable at age 60 = $3,000 x 58% = $1,740. He loses 42% of NIS pension by taking it 7 years early.
So Government pension payable at age 60 = Gross government pension payable at age 60 – NIS pension actually received at age 60
Government pension payable at age 60 = $3,333.33 – $1,740 = $1,593,33.
You asked if the employee would lose 42% of his NIS benefit “until he reaches 67 years old”?
In this case, he would lose 42% of his NIS benefit for life. The NIS pension will not increase when he reaches age 67. A lot of people make this mistake in their thinking..
Please note that, in this case, although the employee is hired after September 1, 1975, he still receives two pensions for life, starting at age 60 :
Government pension = $1593.33
NIS Pension = $1,740.00
I hope this helps.
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“The NIS pension will not increase when he reaches age 67. A lot of people make this mistake in their thinking..”
Mr. Blackman
A few ago, during a conversation with a childhood friend, who coincidentally works at the NIS, I said I was thinking of applying for ‘early pension’ at 59 1/2 years old.
I was told that I would receive 0.05% less until age 67.
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Artax
June 28, 2022 6:39 PM
“Mr Blackman
Isn’t Mr. Codrington’s comments similar to those I made in my June 28, 2022 6:10 contribution?”
Artax,
Yes, the comments are practically the same.
However, I only saw your comments after I had already written and posted mine.
My bad.
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Artax
June 28, 2022 7:17 PM
“Mr. Blackman
A few ago, during a conversation with a childhood friend, who coincidentally works at the NIS, I said I was thinking of applying for ‘early pension’ at 59 1/2 years old.
I was told that I would receive 0.05% less until age 67”
Artax,
You were given bad advice. NIS pensions start at age 60. The reduction in NIS pension is for life.
I have all of the time in the world for you because I know the nature of your profession. Once you understand these concepts clearly, you will be in a position to offer good and proper advice to your clients.
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Artax
June 28, 2022 6:45 PM
“He receives his full pension from GoB until he qualifies for an NIS pension. When he qualifies for a NIB pension ,his GOB pension is reduced by his NIB pension. In total he receives the SAME QUANTUM.”
But, Mr. Blackman’s calculations indicated the individual would receive less and not “the same quantum.”
Artax,
Take a look at my example again:
Remember, with an average 5 yr salary of $5,000 per month, the Gross Government pension is $3,333.33, This is the same quantum as total pensions received below.
A person born on January 1, 1945, who was hired on or after September 1, 1975 and who retired after 33 1/3 years of service will receive the following:
• Government pension = $333.33
• NIS Pension = $3,000
• Total Pensions received = $3,333.33
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Artax
June 28, 2022 10:29 AM
“Mr. Blackman
If you read my first contribution, you would’ve realized I ‘said’ it would interesting to see the GUIDELINES you USED as a BASIS for those calculations, FOR MY EDUCATION.”
Artax,
I am aware that I wrote the following:
A person born on January 1, 2003, who will be hired on or after January 1, 2023 and who will retire after the following years or less of service will receive the following:
• Government pension (1-36 years of service) = $0
• Government pension (37 years of service) = $$83.33
• Government pension (38 years of service) = $166.67
• Government pension (39 years of service) = $250.00
• Government pension (40 years of service) = $333.33
I know that I did not give an insight into the mathematics used to arrive at these numbers . I know also the tremendous ability you have as a researcher, so it is quite possible that some time in the future you may use these BU pages as a reference guide.
Thus, I will see if, in a day or two, I can give you the mathematical guidelines I used to calculate these benefits.
It would be much easier and quicker for me to do so than for you to go researching.
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Mr. Blackman
Thanks.
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@Walter Blackman June 28, 2022 7:39 PM
Thanks as well.
If I understand your calculation, someone entering the public service now and earning above that NIS maximum earning threshold will still receive an additional pension from government on top of their NIS pension once they work the years required to qualify.
Using an example, a government worker working for 9,000 would get a NIS pension based the first $5,000 if that is the NIS max earnings and a government pension based on the next $4,000.
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Critical Analyzer
June 29, 2022 7:59 AM
“@Walter Blackman June 28, 2022 7:39 PM
Thanks as well.
If I understand your calculation, someone entering the public service now and earning above that NIS maximum earning threshold will still receive an additional pension from government on top of their NIS pension once they work the years required to qualify.
Using an example, a government worker working for 9,000 would get a NIS pension based the first $5,000 if that is the NIS max earnings and a government pension based on the next $4,000.”
Critical Analyzer,
Excellent!
Using your example, let us assume the employee works 40 years.
Remember it takes 36 years for the employee to reach the maximum NIS pension of 60% of pay, and 40 years for the employee to reach the maximum government pension of 66 2/3% of pay
Average Government monthly salary = $9,000
Gross Government pension = 66 2/3% x $9,000 = $6,000
Average NIS monthly salary = $5,000
NIS pension = 60% x $5,000 = $3000
Government pension to be received by the employee = $6,000 – $3,000 = $3,000
According to the regulations, the actuarial present value of this government monthly pension = $3,000 x 150 = $450,000
The Prime Minister said that employees working above the NIS ceiling will have to contribute to their pensions. How much of this $450, 000 will this employee have to pay? Your guess is as good as mine. This is another area of pension reform that is a great cause for concern.
For completeness, this employee will receive the following benefits:
Gratuity = 25% x $450,000 = $112,500
Government monthly pension after gratuity = 75% x $3,000 = $2,250
NIS monthly pension = $3,000
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@Walter Blackman
It sounds like this is where the problem really will be as I heard a caller on Brasstacks (Caswell Franklyn I think if I’m not mistaken) state that government workers were paid lower than contract government workers because that missing money was supposed to have been paid into a pension fund which the government appears to never have done and just paid government pensions out of the consolidated fund.
Will the PM attempt to pretend that arrangement never existed and deduct a pension from government workers now to cover that government pension or will they attempt to correct that situation first and seek to deduct additional to make up the shortfall to bring things back into balance?
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Critical Analyzer
June 29, 2022 10:43 AM
“@Walter Blackman
It sounds like this is where the problem really will be as I heard a caller on Brasstacks (Caswell Franklyn I think if I’m not mistaken) state that government workers were paid lower than contract government workers because that missing money was supposed to have been paid into a pension fund which the government appears to never have done and just paid government pensions out of the consolidated fund.
Will the PM attempt to pretend that arrangement never existed and deduct a pension from government workers now to cover that government pension or will they attempt to correct that situation first and seek to deduct additional to make up the shortfall to bring things back into balance?”
Critical Analyzer,
I heard Caswell Franklyn making that point, but I have never seen any document or agreement which supports it.
In any case, the issue relates to prefunding government pension benefits. If $1 billion had been put into that government pension fund, I would bet my last dollar that the politicians would have spent the cash and would have replaced it with government paper. Money would then have to be taken from the Consolidated Fund to liquidate that government paper, and we would be in the same position we are in now.
Government pensioners face a very uncertain future.
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Generally speaking, here are the tools needed to calculate NIS Old Age pensions, and Government pensions.
I am giving examples, under the proposed new government formula, of a person retiring after 36 years, and 40 years of service. I am also showing results for a person working for a salary under the NIS ceiling ($5,000) and a highly paid employee working for $10, 000 per month
NIS Old Age Pensions:
For persons born in or before 1946: 40% x Average Pay (for 1st 10 years) + 1% x Average Pay x (Years greater than 10) – OLD FORMULA
For persons born after 1956: 2% per year x Average Pay (for 1st 20 years) + 1.25% x Average Pay x (Years greater than 20) – NEW FORMULA
For persons born after 1946, and before 1956: 50% x (Result from OLD FORMULA + RESULT FROM NEW FORMULA)
Note: Average Pay = (Pay for the highest 5 years)/5
Maximum NIS Pension = 60% x Average Pay
Central Government Pensions:
For persons hired before September 1, 1975: 2% x Average Pay x Years of service (maximum = 33 1/3 years)
For persons hired on or after September 1, 1975: 2% x Average Pay x Years of service (maximum = 33 1/3 years) – NIS Pension actually received
For persons hired on or after January 1, 2023: 1/60 x Average Pay x Years of service (maximum = 40 years) – NIS Pension actually received
Note: Average Pay = Highest 5-year average
Maximum Central Government Pension = 66 2/3% x Average Pay
Example 1: Person hired on or after January 1, 2023
Date of Birth = 1/1/1996
Date of Hire = 1/1/2027
Date of Retirement = 12/31/2062
Age at pension commencement = 67 years
Years of service = 36
Average monthly pay = NIS Ceiling =$5,000
NIS pension = 2% x 20 x $5,000 + 1.25% x 16 x $5,000 = 60% x $5,000 = $3,000
Central Government Pension at age 67 = 36/60 x $5,000 – $3,000 = $3,000 – $3,000 = 0
Gratuity = 25% x 150 x 0 = 0
Monthly Government pension cheque payable at age 67 = 75% x 0 = 0
This person receives only a NIS cheque of $3,000 per month at age 67
Example 2: Person hired on or after January 1, 2023
Date of Birth = 1/1/1996
Date of Hire = 1/1/2027
Date of Retirement = 12/31/2062
Age at pension commencement = 67 years
Years of service = 36
Average monthly pay = $10,000
NIS ceiling = $5,000
NIS pension = 2% x 20 x $5,000 + 1.25% x 16 x $5,000 = 60% x $5,000 = $3,000
Central Government Pension at age 67 = 36/60 x $10,000 – $3,000 = $6,000 – $3,000 = $3,000
Gratuity = 25% x 150 x $3,000 = $112,500
Monthly Government pension cheque payable at age 67 = 75% x $3,000 = $2,250
This highly paid person receives a NIS cheque of $3,000 per month at age 67, plus a government cheque of $2,250 per month.
Example 3: Person hired on or after January 1, 2023
Date of Birth = 1/1/1996
Date of Hire = 1/1/2023
Date of Retirement = 12/31/2062
Age at pension commencement = 67 years
Years of service = 40
Average monthly pay = NIS Ceiling = $5,000
NIS pension = 2% x 20 x $5,000 + 1.25% x 20 x $5,000 = 65% x $5,000 = $3,250
But maximum NIS pension = 60% x $5,000 = $3,000
Government Pension at age 67 = 40/60 x $5,000 – $3,000 = $3,333.33 – $3,000 = $333.33
Gratuity = 25% x 150 x $333.33 = $12,499.88
Monthly Government pension cheque payable at age 67 = 75% x $333.33 = $250.00
This person receives a NIS cheque of $3,000 per month at age 67, plus a government cheque of $250.00 per month
Example 4: Person hired on or after January 1, 2023
Date of Birth = 1/1/1996
Date of Hire = 1/1/2023
Date of Retirement = 12/31/2062
Age at pension commencement = 67 years
Years of service = 40
NIS Ceiling = $5,000
Average monthly pay = $10,000
NIS pension = 2% x 20 x $5,000 + 1.25% x 20 x $5,000 = 65% x $5,000 = $3,250
But maximum NIS pension = 60% x $5,000 = $3,000
Government Pension at age 67 = 40/60 x $10,000 – $3,000 = $6,666.67 – $3,000 = $3,666.67
Gratuity = 25% x 150 x $3,666.67 = $137,500.13
Monthly Government pension cheque payable at age 67 = 75% x $3,666.67 = $2750.00
This highly paid employee receives a NIS cheque of $3,000 per month at age 67, plus a government cheque of $2750.00 per month
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@WB
What is the function of the Gratuity calculations, they don’t seem to impact anything?
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Northern Observer,
First, we calculate the “gross” pension, and then we have to calculate the gratuity.
The net pension (Gross pension – Pension used to calculate the gratuity) is the actual monthly cheque the employee will receive.
Pensioners in private, government, and NIS plans routinely compare benefits with other employees.
Practitioners involved in calculating or checking NIS benefits will come across participants who claim that their gratuities or net pensions are incorrect. For these practitioners, I have tried to cover all bases in my calculations.
Thats all. Thanks
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Thank you
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Source: Nation
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