Mandeville Weekly News

ACTUARIAL REVIEW OF NIS EVERY THREE YEARS

Posted by SR (riley) on Oct 05 2016 at 6:36 PM
Mandeville Weekly News >>

The House of Representatives has approved amendments to the National Insurance (Amendment) Act, allowing for an actuarial review of the national insurance scheme (NIS) every three years, instead of the current five years. The Bill was piloted by Minister of Labour and Social Security, Hon. Shahine Robinson, in the House on September 28.Minister Robinson said the reduction in the review period would place the Ministry in a better position to more closely monitor and introduce pre-emptive measures or timely interventions to ensure the long-term sustainability of the Scheme.  “More frequent actuarial reviews will provide critical information that will support risk management and improved governance of the NIS pension funds.   More frequent actuarial reviews will also assist in making long-term financial and investment decisions of the Fund,” she explained.

In addition, she said the reviews will allow for greater transparency and accountability and will enable the Ministry to monitor the effectiveness of reform initiatives.  “The amendments proposed in this Bill will support our efforts in ensuring the sustainability of the NIS and its ability to honour its financial obligations to contributors,” Minister Robinson said.
 Meanwhile, the Minister said the NIS Reform Committee has completed its assessment of the actuarial report done by Eckler Consultants, noting that the recommendations from the committee will be presented to the Cabinet at its next meeting.
 The actuarial report projected that the National Insurance Fund cash flow is at risk of being depleted by 2033 if serious efforts are not made to reform the present structure and operation of the Scheme.

At present, more than 112,000 persons are in receipt of benefits from the Scheme. In the 2015/2016 financial year, over $15.4 billion was spent on NIS benefits, while $12.8 billion was collected in contributions. This represents a gap of $2.6 billion.

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