Government Senator Professor Trevor Munroe has defended the passage of the Pensions Bill.

The Act to make provision for the management of superannuation funds and approved retirement schemes, which was passed in the Senate on July 30, was essential at this time as it was unacceptable and dangerous for pension funds to continue operating without appropriate regulation, Munroe argued.

He also highlighted the positives, as well as some issues of concern on which he and vice-president of the Jamaica Confederation of Trade Unions Senator Dwight Nelson had come to consensus in the interest of the workers. Senator Munroe commended the government’s decision to put the second phase of the pension reform programme on hold to allow for public education as it related to the new legislation.

“We commended the government for adopting, yet again, a participatory and inclusionary approach,” he said.

Identifying another positive feature in the Bill, he made note of the provision which made it mandatory for fund managers (or employers) to make information available to contributors.

“If you should go to any work centre in this country where pension schemes exist, what you will find is that a major complaint of employees, today and over the years, is that they are kept in the dark about what is happening to their money,” the Government Senator said. “This clause in the Bill, when enacted, should put an end to that justifiable complaint of the working people.”

As set out in the Bill, fund managers and employees who fail to give information to members (contributors) can be fined up to $500,000. Various other breaches of the Act, including performing duties as an administrator or investment manager without being licenced under the Act, could attract fines of up to $5 million.

Senator Munroe pointed out that some parts of the Bill, which were in need of amendment, included the fact that there was no provision for employee or member-nominated trustees.

He described this as “dangerous business and unacceptable”, adding that this had been one of the major recommendations that had come out of the consultations with the trade unions and which had been submitted in the White Paper on pension schemes in Jamaica, which was published in May 2001.

He proposed that the Bill be amended to insert provision for member-nominated trustees as one condition for the approval of any scheme.

Senator Munroe also pointed out that the Bill required too little accountability from the Financial Services Commission, which would be administering the new pensions regime bringing public and private pension funds under more stringent management. He argued that there should be a mandated time period within which the FSC should respond to applications for registration or proposed rule amendments submitted to them, since time constraints were being imposed on stakeholders.

Meanwhile, Leader of Opposition Business in the Senate Anthony Johnson suggested that mechanisms be implemented to encourage self-employed persons to contribute to pension schemes as these were the individuals who would need the benefits most since, in many instances, such persons became indigent.