Pension crisis looms
THE economic burden of maintaining dependent, older persons is growing alarmingly for the working population.
By Emile Spence's reckoning, as the population ages, the burden on the working population to support the growing elderly will increase. "There will be greater reliance on the state to provide services for this group," he said.
The Jamaica National Building Society (JNBS) executive with responsibility for the JN Individual Retirement Scheme (JNIRS) said that the concern arises from data projections for the elderly population to grow from 7.7 per cent of the population in 2001 to 11.2 per cent in 2030,
What's more, women in 2010 were having half as many children as in 1975, and that level is expected to continue falling.
"In the past, some persons saw their children as their old age pension, but today children do not always remain with the extended family to take care of ageing parents," Spence said.
According to the JNBS executive, the building society recognised the pending crisis in 2008, and responded by applying for a pension licence.
JNRIS was eventually established by last year, when it was approved by the Financial Services Commission to operate a private pension scheme.
"In 1962, the year of our Independence, the life expectancy was approximately 65 years. Now, many more people are living healthily up to an average of 75 or more years; and the international standard for life expectancy in Jamaica is approximately 73.4 years," Spence said. "This should be a wake-up call for everyone. The message for government, corporate planners and employers is that there is a need to plan for our aging population as people are generally living longer."
He noted that JNBS would be implementing several initiatives to educate Jamaicans about working towards securing their retirement years and becoming members of the JNIRS.
"We must consider our personal goals and welfare and begin to plan for our retirement now. Retirement is too important a phase in our lives for us to leave it up to our employers, and government to plan; or to be left to rest upon the shoulders of our children," the JNBS executive declared.
Quoting figures from the Financial Services Commission, Spence also pointed out that since 2010, membership in individual retirement schemes had more than doubled, moving from 8,170 to 17,554 contributors. He was optimistic that individual retirement schemes would continue to grow, adding that JNIRS had laid the foundation to participate in that growth.
"A properly managed pension system, which meets the needs of people after retirement, is now essential for Jamaica," he said.