Wed, 11 Dec 2019 03:00:07 -0500
Experts praise new tourism pension schemeBY BALFORD HENRY
The Tourism Workers Pension Scheme, which was approved earlier this year in Parliament, has continued to receive the thumbs up across the pension/retirement landscape.
The latest commendations came from the members of the Pension Industry Association of Jamaica (PIAJ), who were guests of the Jamaica Observer's weekly Monday Exchange at Beechwood Avenue, Kingston, on Monday.
President of the PIAJ, Sanya Goffe, noted that although her association had nothing to do with the proposal for the scheme, she thinks it is a very good start.
“The ability for each tourism worker, whether he or she works in a hotel or drives a taxicab or operates a food stall, for that person to be able to become a part of the pension fund, that's an excellent thing, especially for those persons who have employers, to have the additional benefit that the employer is required to make a contribution on their behalf. So, to me, it is really a great start,” Goffe said.
PIAJ Director Desmond L Johnson was also enthusiastic about the new pension fund, and felt that it was an excellent move by the government.
“I think what it will do is to help us close the gap in terms of personal coverage, because currently we are only about nine per cent in terms of (personal) coverage, although if you include the public sector it would make it about 20 per cent. So, this will certainly help in terms of increasing (pension) coverage for all Jamaicans,” Johnson explained.
Goffe said that the best thing about the new scheme is that some of the features which are included are really groundbreaking.
“There are some features that we have never seen before being accommodated for private sector workers, for example automatically vesting 100 per cent of the contributions, whereas now in employer-sponsored pension arrangements there is a vesting period for the employers' contribution and all tourism workers are eligible, so there is no discrimination. It is just equal access right across the board,” she stated.
She also pointed out that casual/seasonal workers are being accommodated by the tourism pension fund, and would not be prejudiced against for the period during which they are not required to work.
“That was something that was affecting the tourism workers before, and what I think is the most impressive feature is the portability to overseas employment. So right now you can be working at one place and decide you are leaving and you can port it to your new employee overseas,” she revealed.
“So assuming that your employer is overseas, if you are taking up employment elsewhere you are able to port that pension benefit. That's significant for us, because we don't have that contemplated right now under our pension laws. We do have some legislation in place for reciprocal arrangements, but they are not incorporated fully into domestic legislation. So it is not something the average person can have access to and, in any event, those treaties and bilateral agreements only apply to government-sponsored National Insurance Scheme arrangements,” she added.
Parliament passed the Tourism Workers Pension Bill, which seeks to establish a defined contribution pension scheme for hospitality industry workers, in mid-2019. It was piloted by Tourism Minister Edmund Bartlett.
Bartlett told the debate that the scheme is the largest single pension plan in Jamaica, and arguably the Caribbean, and a landmark development for the country's workforce.
“It will involve in excess of 300,000 workers, which will represent one-fifth of the total workforce of Jamaica. That accumulation of affordable capital will present an opportunity for investment and for capital distribution for all sorts of development in the country,” he said.
Bartlett also argued that the Bill and, by extension, the pension scheme, is coming at a time when the sector is experiencing unprecedented growth.
The pension scheme will require mandatory contributions by workers and employers, with benefits payable at age 65 years or older.
The Financial Services Commission will have regulatory oversight of the scheme, in accordance with the provisions of the Tourism Workers Pension Act, the Pensions (Superannuation Funds and Retirement Schemes) Act, and the Financial Services Commission Act.
The scheme's establishment is consistent with the Government's focus on creating a social security network within the tourism sector. It is one component of a three-point human capital development plan for industry workers, which also includes training and capacity-building.
Some of the people who will benefit include: rafters, craft traders, bus and taxi drivers, spa operators, housekeepers, and groundsmen who are not directly employed in tourism, and are self-employed in some cases.
Home | Lifestyle | Teenage | Regional | Environment | Editorial | Columns | Career | Food | All Woman | Letters | Auto | Video | Weather | Contact Us
Mobile | View Standard Version
Subscribe to our RSS Feeds
Follow us on Twitter!
Copyright © 2012 Jamaica Observer. All Rights Reserved.
Terms under which this service is provided to you.