Public Services and National Insurance Minister Brensil Rolle.
By KHRISNA RUSSELL
Deputy Chief Reporter
krussell@tribunemedia.net
CRITICAL decisions will have to be made regarding the National Insurance Board and the administration of contributions it collects to ensure there remains longevity of the social security net’s benefits, according to a Cabinet minister yesterday.
Public Service and NIB Minister Brensil Rolle told reporters either every working person will have to pay more contributions into the safety net or benefits offered will be lessened to match the level of contribution made.
He further issued a warning to employers who deduct NIB contributions from workers but fail to pay them to the board, saying perpetrators will be “absolutely” aggressively pursued.
“What I do know though is that our benefits are outstripping our contributions and we’ve got to look at what we need to do to bring that balance back to NIB so that everyone could get the required social security services that’s needed from NIB,” Mr Rolle said yesterday outside of Cabinet.
His comments came when he was asked if he anticipated NIB to be operating at a deficit. He said he didn’t suspect this would be the case.
Earlier he said: “It’s always a challenge to balance your books but NIB is in a process now where we are trying to look at our assets (and) make a judgement on what assets we need to sell. But at the same time, we are constantly looking at opportunities to empower the organisation and to go into areas that will assist social security development in the Bahamas.”
In an article recently published in the Wall Street Journal, trustees said by 2035 US Social Security will no longer be able to pay its full scheduled benefits unless Congress steps in to shore up the programme.
Asked if the Bahamas was to face a similar predicament, Mr Rolle said: “Absolutely. I said it at the outset is that we are paying out more benefits than the contributions we are taking in so that’s going to require some intervention.
“We are looking at what those options are at NIB and we anticipate that the Bahamian public would be made aware very shortly.
“I think our actuarial would have suggested 10 years from now, I can’t remember specifically what the drop-dead date is, but again we are not a money making institute, we collect contributions from you to pay out benefits to you and that’s all we do.”
He added: “I don’t know that we will ever run out of funding. What I do know is if our contributions are not being equal to our benefits only two things can happen, either we can ask you to increase your contributions so that we can pay your benefits or we have to decrease your benefits to become equal to your contributions,” he explained.
“I am saying this is where our actuarial is saying this is where the rubber is really going to reach the road. We are going to have to make some critical decisions before that to keep the funds vibrant and keep our social security network intact.”
Regarding employers who fail to pay contributions, Mr Rolle said: “That is so unfair and unacceptable. It is perhaps bordering on criminal. If I take your monies from you to make a contribution to your social security network and you get sick and suddenly find out listen my contributions are not paid, then that’s an issue.
“What we say to every single employee though is there is a means by which you can go to NIB and go online to see whether your contributions are being paid. So don’t wait for NIB. Just go there and find out what do I need to do to ensure that my contributions that has been taken from me on a weekly basis is contributed to NIB and you keep your own record and you can’t go wrong.”
Non-payment of employee NIB contributions is an offence under the National Insurance Board Act, liable to a minimum of six months in prison or a fine of $1,000, or both, to a maximum of 12 months in prison, or a fine of $2,500, or both.
Last June, Mr Rolle warned that NIB contributions could possibly increase in the future.
At the time, he was asked about the financial stability of NIB after Health Minister Dr Duane Sands said it was on the brink of bankruptcy.
Dr Sands highlighted the debts owed to NIB as he defended the government’s decision to increase the VAT rate from 7.5 percent to 12 percent.
Mr Rolle also told reporters yesterday that the government has plans to hire 200 Bahamians with degrees to work in the public service sector, but on contract.
He further commented on the government’s position on accrued vacation time.
“We are just asking individuals to take their vacation because the government has a policy position, which is we don’t pay for vacation. You take your vacation or alternatively you may forfeit your vacation.”
He said he was unsure of how many public sector workers had been asked to take vacation, but the government decided it was stepping away from the practice of paying workers for vacation they did not take prior to retirement.
Comments
DDK 5 years, 8 months ago
This country is so sick and corrupt I wonder whether it is too late to recover. If successive foolish governments and their civil servants keep overspending and stealing from the Treasury the cupboard will naturally become bare......
Look at all the vehicles with red government plates that were up and down until all hours all holiday weekend, no doubt gassed up at the expense of The People. Just one example of theft and lack of control.
Well_mudda_take_sic 5 years, 8 months ago
Anyone making contributions to NIB today, with the hope of getting something comparable back tomorrow, is denying the reality of NIB's true financial situation and quite literally throwing money away. Blood can't be had from a stone and therefore raising contribution requirements will not be an option. Raising contribution requirements will only result in many more instances of non-compliance and thereby exacerbate the already dire financial situation of NIB. There is simply no longer any elasticity as far as collecting additional contributions go. Besides, who in their right mind would want to pay more in contributions today in order to get much less back by way of markedly reduced benefits tomorrow. NIB is for all intents and purposes insolvent, and has been so for quite sometime. It will eventually be would up by government being forced to reduce the payout of benefits until there is no more to be paid out. That's the stark reality of NIB's situation arising from fraud, waste and mismanagement tolerated (and even perpetrated) by successive corrupt governments. NIB's grave should be readied sooner rather than later. Employers and employees paying into this abused and misused scheme over the years will just have to accept that they got a royal shafting and would have been much better off not contributing a copper to NIB.
sheeprunner12 5 years, 8 months ago
All Western democratic developing countries are having issues with social security systems because ....... 1. populations are aging ............... 2. many employers are dodging ........... 3. many self-employed are dodging ............ 4. Government workers get added perks ......... 5. more benefits are added without requisite tax increases ............... 6. politicians exploit the funds for their short term gain (aka piggy bank) ........... 7. too many institutional overheads at NIB ........... 8. the funds are used for public works, housing, & infrastructural development (aka NIB investments ............. 9. funds are "invested" in overseas projects (aka stock market, FDI shares) ............ 10. Double payments schemes and old-fashioned white collar crimes.
NIB suffers from ALL of these and more ........... no wonder the $$$$ bleeding that takes place.
realitycheck242 5 years, 8 months ago
Sheep you can also add the big one ADMINISTRATIVE EXPENSES.
sheeprunner12 5 years, 8 months ago
That's #7 ........... Salaries and perks at NIB are far too high to sustain long term
Chucky 5 years, 8 months ago
There is only 1 real reason that governments get into the pension business, that is simply to have another big pie to steal a slice from. Though in our case, there is not even 1 slice remaining.
Godson 5 years, 8 months ago
All of you persons above seem to recognize the chronic diseases affecting our institutions of government, however, what are we going to do to rid our institutions of government of these inept, incompetent delinquents? They are winging it and hoping that it will all go away.
The previous administration combined these traits with corruption and now this one thinks that it can wing it out until the next election. But there are still yet proactive and fundamental engagements that are needed in order to turn away the social and economic erosion of our Country; otherwise, we are all left to a state of despondency.
This state of affairs seem to be the precipitation of a political revolution. They have eyes to see and cannot see; ears but cannot hear, nor, listen. Sometimes, just to hear their responses to the pending situations and growing social crises will cause any enlightened individual to cringe at their shallow concepts.
sheeprunner12 5 years, 8 months ago
Your political godmother could not solve it either ........ best she can do is bury the dead.
Dawes 5 years, 8 months ago
Why does the Government always say they are going to go after non payers of taxes. They always say this and then i hear nothing. Make a big thing out of it. Splash that persons face across the papers and TV doing the bank lane shuffle. Make sure all know they will be held accountable. As it is we all know thats just talk. They are still much more likely to increase the contributions then actually go after someone. As ever the honest are forced to pay more for the dishonest.
Godson 5 years, 8 months ago
What you are stating is not a solution. It is an expression of anger. This is what I mean by shallow thinking.
Godson 5 years, 8 months ago
It is reactive in nature and does not go to source of the problem.
Dawes 5 years, 8 months ago
I may have said ti wrong. I meant before they consider increasing controibutions or decreasing benefits, firstly make sure everyone is paying what they should. Then if there is a shortfall other items should be considered. In addition the NIB should have the accounts fully published and an explanation given if they do not make a return over a certain benchmark as this shows those in charge of the funds are not knowledgeable enough to advise them. And finally stop using NIB to pay for Government largess. Every time a new capital expenditure is needed NIB is raided as though they will get those returns.
Godson 5 years, 8 months ago
You are right, however, - and gain - it is because they are intellectually shallow. Many are called but few are chosen. So are called, some are sent and some went. I don't know but it seem like nature pits us to go worse, worse and worse... Where is the blessings of social progression. Did I grow up to become ruled by imbeciles? Anyway, you be encouraged.
The_Oracle 5 years, 8 months ago
A Government sanctioned and typically Bankrupt PONZI SCHEME! In paying contributions since its inception I have never had any delusions of ever collecting any benefits, more so from the day the Government started borrowing the funds! Government can't run a roadside lemonade stand without tiefing the lemons first and then stealing the revenue (if any) after.
BONEFISH 5 years, 8 months ago
NIB is in all kinds of problems.The FNM government discontinue the practice of getting a letter of good standing from NIB to get a business licence renewal. That was the chief method of getting compliance to pay NIB from some businesses.Sometimes you can't throw the baby out with the bath water.
Well_mudda_take_sic 5 years, 8 months ago
You should just listen to yourself for a brief moment, Why should employers and employees be forced in any way to pay into a Ponzi scheme that has developed as a result of government misusing funds it should have been holding and investing in a fiduciary capacity for the intended beneficiaries?
Dawes 5 years, 8 months ago
They still need a letter of Good standing, its just done behind the scenes by Government. That way easing the amount of paperwork a business needs to get in order to be business license compliant.
screwedbahamian 5 years, 8 months ago
Instead of NIB investing it funds in sound Long term investments (like owning outright and partnership in the Major Hotels and other investments in the Tourist Industry) the Governments instead gave the funds to The Bank of the Bahamas to make million of dollars to dead beat Politicians who today are running around living large and enjoying life with the Honest Bahamian Pensioners money. Shame ! Shame!. Any non politician Bahamian that is depending on the monthly pension income promised at their retirement age " SHOULD NOT" . My own personal experience of having contributed since the inception in 1973 and after some 38 years at retirement age was told sorry you no longer qualify for a pension, go live of Jumbey bush and die. THE PAPA "DOC" INGRAHAM GOVERNMENT.
realitycheck242 5 years, 8 months ago
ScrewedBahamian.... Something is wrong with the picture you are painting about your contributions to NIB for 38 years and not being able to recieve a pension. 1) Did NIB loose your contributions records? 2)Did your employers over the years not make your contributions to NIB?
You should atleast qualify for the minimum wage pension even if you were self employed and has gaps in your contribution history.
Tke your case to the appeals tribunal at NIB
screwedbahamian 5 years, 8 months ago
Thank you realitycheck242. I am pursuing the matter to no end. I applied for my pension in 2010 and NIB could not locate my records and requested that I contact The International Banking Firm to obtain my records. explaining that the firm had dissolved and was told to find copy of paychecks from showing my information. unable to locate the paystubs. I visited the NIB and explained that I could not locate the paycheck to another clerk there. She again entered my name system and found all my information, but was happy to announce that because of The Hubert (PAPA DOC) Ingraham new NIB pension benefits takeway law, that I could not qualify and would have to apply for the old age pension to see if I could qualified for that. Now the NIB say that since i applied for the NIB pension benefits that I can not qualify for the old age pension. TRULY NON BAHAMIAN TREATMENT!!!!
Well_mudda_take_sic 5 years, 8 months ago
Every current MP and Senator, and every past MP and Senator still alive today should (somehow) be made to forfeit all of their very generous pension and other benefit entitlements, with the annual equivalent thereof (somehow) being paid by the Public Treasury into the national insurance fund. That would be a most fitting and fair retribution for their failure to responsibly ensure NIB remained capable of fulfilling its obligations to contributing participants without raising contribution requirements to unrealistic Ponzi scheme type levels.
sheeprunner12 5 years, 8 months ago
Parliamentarians pay into a contributory pension plan ......... The BIG problem in this country is that the CIVIL SERVICE pension plan is a non-contributory scheme that has the Government on hook for at least $1.5 Billion per year now.
This is unsustainable ........... but NO politician has the BALLS to touch that.
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