Bitter deal faces sugar pensioners
HUNDREDS of pensionable workers in the island’s sugar industry could be in for a bitter deal in their twilight years as millions of dollars deducted from their salaries as national insurance contributions have not been paid over to the Government.Parliament’s Public Accounts Committee (PAC) heard Tuesday that of the $354 million that is outstanding to the National Insurance Scheme (NIS) only $50 million of that sum has been collected. The Sugar Company of Jamaica accounts for $286 million of the sum owed.In addition, employers who submitted 325 dishonoured or ‘bounced’ cheques between 2007/2008 totalling $10.5 million as pension payments for monies they deducted, could be publicly humiliated shortly as the committee contemplates publishing their names.At the time of the Auditor General’s report in December, only $1 million had been recovered.In the case of the sugar workers, the meeting was told that the Ministry of Finance had given an assurance that the National Insurance Scheme would be paid the SCJ’s sum that was outstanding from the sale of the companies. However, the meagre monthly stipend could still be difficult to pay as the committee said that there may be nothing left after the sale.Permanent secretary in the Ministry of Labour and Social Security Alvin McIntosh said that any worker whose contributions were not paid over to the ministry would not get a pension upon retirement.”The NIS has developed into a very important social protection programme, providing retirement benefits for a very large number of persons. Life expectancies are increasing, people are living longer, which means that we will have to pay out more to our retirees and for a longer period of time. It is heart-rending when some former workers come to the office and when we check the record, sometimes we do not have adequate contributions to award them a pension. So our employers must buy into the importance of remitting these deductions to the ministry,” the permanent secretary said.”The unfortunate things sir,” he addressed the chairman, “is that people become conscious of pension when they are near retirement age. Every employee has a right to demand from his or her employers a status account of his or her contributions to the NIS. That must be provided.”PAC chairman Dr Omar Davies said that employers who collected workers’ contribution and did not pay it over to the National Insurance Scheme (NIS) were engaging in criminal activities.”When you collect from a worker’s pay and keep it, its criminal. That is not an offence, that is a crime,” Davies said, calling for tighter legislation to deal with delinquents.His comments were met with agreement.McIntosh said that a number of legal proceeding have been instituted against delinquent employers, but his statement that employees would not get a pension did not go down well with several committee members who said that there should be stiff penalties to the employers who failed to pay over the contributions.Committee members Michael Peart (Manchester South) Fitz Jackson (St Catherine South) and Lisa Hanna, (St Ann South East) spoke passionately on behalf of bauxite and sugar workers respectively.”Many, many of my constituents have come to my office with their pay statements showing that statutory deductions have been made. But when they go to the respective offices there is no evidence of payments”, Peart said, making specific reference to employees who were contracted.Peart was adamant that, “if the employers did not make over the payments, the workers should not suffer.”Hanna said that her office had often been asked to help.”The persons who come to me are persons going over 70 years now, going into their 80s and are really seeking recovery. The policy must be changed. It can’t continue this way,” Hanna said.She said that many of the workers are often not aware of the terms and conditions of their employment, and more so, what are their entitlements.McIntosh admitted that the matter of bounced cheques for NIS contributions was a serious state of affairs.His announcement that there was 75 per cent compliance in NIS contributions, did not bring much comfort to the members. Neither did his explanation that the ministry was often glad to get the principal sum owed, that penalties were not stringently demanded.”You deduct money from a worker’s pay cheque and then you pay with a bounced cheque. How does a company like that get redemption that you start taking cheques again from them? I think that what we are doing now is a slap on the wrist, if you find them (companies),” Davies said.Peart said that he had no joy from the proceedings as his constituents were no better off and Jackson said that his were suffering.McIntosh promised that the matter would be vigorously diffused.He said that there were awareness programmes twice per week on Mondays and Wednesdays in the media explaining issues to both employers and employees.He also said that trade unions and employees have a role to play in the matter.Committee member Dr Morais Guy said that he wanted further debate on the matter in Parliament.
HUNDREDS of pensionable workers in the island’s sugar industry could be in for a bitter deal in their twilight years as millions of dollars deducted from their salaries as national insurance contributions have not been paid over to the Government.
Parliament’s Public Accounts Committee (PAC) heard Tuesday that of the $354 million that is outstanding to the National Insurance Scheme (NIS) only $50 million of that sum has been collected. The Sugar Company of Jamaica accounts for $286 million of the sum owed.
In addition, employers who submitted 325 dishonoured or ‘bounced’ cheques between 2007/2008 totalling $10.5 million as pension payments for monies they deducted, could be publicly humiliated shortly as the committee contemplates publishing their names.
At the time of the Auditor General’s report in December, only $1 million had been recovered.
In the case of the sugar workers, the meeting was told that the Ministry of Finance had given an assurance that the National Insurance Scheme would be paid the SCJ’s sum that was outstanding from the sale of the companies. However, the meagre monthly stipend could still be difficult to pay as the committee said that there may be nothing left after the sale.
Permanent secretary in the Ministry of Labour and Social Security Alvin McIntosh said that any worker whose contributions were not paid over to the ministry would not get a pension upon retirement.
“The NIS has developed into a very important social protection programme, providing retirement benefits for a very large number of persons. Life expectancies are increasing, people are living longer, which means that we will have to pay out more to our retirees and for a longer period of time. It is heart-rending when some former workers come to the office and when we check the record, sometimes we do not have adequate contributions to award them a pension. So our employers must buy into the importance of remitting these deductions to the ministry,” the permanent secretary said.
“The unfortunate things sir,” he addressed the chairman, “is that people become conscious of pension when they are near retirement age. Every employee has a right to demand from his or her employers a status account of his or her contributions to the NIS. That must be provided.”
PAC chairman Dr Omar Davies said that employers who collected workers’ contribution and did not pay it over to the National Insurance Scheme (NIS) were engaging in criminal activities.
“When you collect from a worker’s pay and keep it, its criminal. That is not an offence, that is a crime,” Davies said, calling for tighter legislation to deal with delinquents.
His comments were met with agreement.
McIntosh said that a number of legal proceeding have been instituted against delinquent employers, but his statement that employees would not get a pension did not go down well with several committee members who said that there should be stiff penalties to the employers who failed to pay over the contributions.
Committee members Michael Peart (Manchester South) Fitz Jackson (St Catherine South) and Lisa Hanna, (St Ann South East) spoke passionately on behalf of bauxite and sugar workers respectively.
“Many, many of my constituents have come to my office with their pay statements showing that statutory deductions have been made. But when they go to the respective offices there is no evidence of payments”, Peart said, making specific reference to employees who were contracted.
Peart was adamant that, “if the employers did not make over the payments, the workers should not suffer.”
Hanna said that her office had often been asked to help.
“The persons who come to me are persons going over 70 years now, going into their 80s and are really seeking recovery. The policy must be changed. It can’t continue this way,” Hanna said.
She said that many of the workers are often not aware of the terms and conditions of their employment, and more so, what are their entitlements.
McIntosh admitted that the matter of bounced cheques for NIS contributions was a serious state of affairs.
His announcement that there was 75 per cent compliance in NIS contributions, did not bring much comfort to the members. Neither did his explanation that the ministry was often glad to get the principal sum owed, that penalties were not stringently demanded.
“You deduct money from a worker’s pay cheque and then you pay with a bounced cheque. How does a company like that get redemption that you start taking cheques again from them? I think that what we are doing now is a slap on the wrist, if you find them (companies),” Davies said.
Peart said that he had no joy from the proceedings as his constituents were no better off and Jackson said that his were suffering.
McIntosh promised that the matter would be vigorously diffused.
He said that there were awareness programmes twice per week on Mondays and Wednesdays in the media explaining issues to both employers and employees.
He also said that trade unions and employees have a role to play in the matter.
Committee member Dr Morais Guy said that he wanted further debate on the matter in Parliament.