0

Just 30% of workers covered by pensions

Just 30 per cent of the Bahamian workforce is covered by employer-sponsored pension plans, the Central Bank’s governor said yesterday, acknowledging that the relative lack of diversified investment opportunities in the Bahamas presented challenges.

John Rolle, speaking as a panelist at the Bahamas Institute of Chartered Accountants (BICA) Accountants’ Week conference, said: “Close to about 50,000 persons, by our estimates, participate in plans, so it works out to about 30 per cent of the workforce.”

He added: “There are challenges in terms of how portfolios are invested because basically government registered stocks (BGRS) are the largest investment opportunity.

“Then there are bank deposits and a small amount of equity, so the diversification of plans and the opportunities around diversification are very important. I think that there are more diversification options that are currently not being exploited.”

Mr Rolle said the Central Bank estimates that Bahamian pension assets are worth roughly $1.2 billion, equivalent to 15 per cent of gross domestic product (GDP).

Larry Gibson, vice-president of Colonial Pension Services and a long-time advocate of legislation to protect the private pension fund industry, referred to the issue as a “ticking time-bomb”.

He added that pension plan participation rates in the Bahamas are too low, and mandatory pension legislation is needed.

“Even legislation in and of itself is not the answer. Not only do we have to have legislation that is mandatory to create the savings, we need to do a lot of education in terms of additional voluntary contributions,” Mr Gibson added.

Comments

ohdrap4 8 years, 1 month ago

in the absence of legislation, the pension funds are for the retiremenet of the bosses.

that is why refuse to participate.

i quit a job because they made a pension fund mandatory. the ones who stayed lost all their contribution when the company closed.

killemwitdakno 8 years, 1 month ago

Are they saving for retirement another way?

ohdrap4 8 years, 1 month ago

the bosses? No they fritter the cash flow and retire from the employee funds. ever heard of clico or city meat? those bosses retired nicely.

Sign in to comment