National Insurance Fund in Critical Condition
After the dust settled yesterday evening at the Lloyd Erskine Sandiford Sandiford Centre (LESC) Prime Minister Mia Mottley confirmed in flowery language what some in this medium and elsewhere have been alerting the public. The National Insurance Fund (NIF) on its current trajectory will be unable to honour its obligations to persons eligible for benefits from as early as 2034 – that is a short 12 years.
Was Prime Minister Mottley quoted in the press correctly that she was alerted to the danger faced by the NIS in June 2022 by actuary Derek Osborne? Surely the Prime Minister does not believe some of us are so gullible? That aside the blogmaster is pleased on the occasion of the availability of the 17th Actuarial Review of the National Insurance Fund, Unemployment Fund and Severance Fund as of December 31, 2020 it has finally been positioned on the front burner.
A bone of contention has been the inability of the NIF to produced up to date financials. We learned yesterday during the press briefing at LESC the challenge is linked to reporting cash and accrual items and is being addressed by the NIS Board and Auditor General’s office. Again the promise of when current financials will be available is cloaked in non committal language. Although the NIS continues to struggle to produce current audited financials the prime minister’s message is correct, the structural problems afflicting the NIS looms large and must be the priority 1 concern.
The key takeaway from the briefing yesterday is that in a short 12 years the NIF will not be able to pay benefits to those eligible IF reform measures are not taken in the short term. With an ageing AND shrinking population there are limited corrective options available that will not be ‘painful’- add an underperforming economy to the mix and houston, we have a problem.
That it has taken so long to get to where we are today is bound up in politics but we are here now. Better late than never some say. Deputy chair of the NIS Board Rawdon Adams appears to have a grasp of the problem and seems earnest in his comments to move the matter along. We wish him and his Board of Directors well. The NIS is our rh life line.