SEVERAL pensioners across the island have welcomed the increase in benefits to be provided to them in the next fiscal year, starting April 1.

The benefits paid to pensioners by the Government have not been adjusted since 2009, so when Finance Minister Dr Nigel Clarke, in opening the budget debate last Tuesday, announced that pension and age-relief exemptions will move from $80,000 to $250,400 the seniors were overjoyed.

Several government pensioners with whom the Jamaica Observer spoke wholeheartedly welcomed the move and expressed appreciation that they are now receiving well-needed attention. They, however, did not wish to be identified by name or previous profession.

“The pension package is quite timely, given the financial challenges being experienced by this vulnerable group at this time,” one 80-year-old pensioner told the
Sunday Observer.

“It is good to know that pensioners will benefit as it is becoming increasingly difficult to cope — financially and otherwise,” said the pensioner who retired in 2002.

Another pensioner, who is 79 years old and retired in 2005, said she thinks it is an “excellent package” that is long overdue.

“It is very good that the senior citizens were not left out, and we greatly appreciate this gesture,” she said.

Yet another retiree said that while she does not fully understand the provisions, she is happy nonetheless for the increased benefits.

In the meantime, chair of Caribbean Community of Retired Persons (CCRP) Jean Lowrie-Chin said she is happy the Government took the entity’s suggestion for increased benefits to pensioners. In fact, the increase exceeded expectations.

Lowrie-Chin said her organisation, which represents the interests of Jamaica’s seniors, had written to the finance minister last year and the year prior, detailing its request for this increase. She said CCRP is “grateful that he responded positively in his budget speech”.

“I would like to thank Minister Clarke for being receptive to our suggestion, and for even going beyond our suggestion of doubling the pensioner tax relief to $160,000 by increasing this to $250,000,” she said.

In one of the letters seen by the Sunday Observer, dated May 23, 2023, Lowrie-Chin said elderly citizens are struggling to make ends meet and are acutely affected by inflation.

“We appeal to you to give them some measure of relief by increasing their government pensions and waiving taxes on pensions, or improving the tax relief benefits,” the letter read.

In his presentation on Tuesday the finance minister also explained that individuals under 55 years of age and who are receiving a pension from an approved statutory pension scheme, or an approved superannuation scheme, are entitled to a tax exemption of $80,000, restricted to the pension income only. If the pensioner is 55 years and over, the $80,000 tax exemption can also be applied to the other sources of income. This is known as a pension exemption. This threshold was last adjusted in 2009.

“There are people who are on fixed incomes, who retired during periods of instability [and], are having it hard because their pensions are based on small salaries that are low and we have a threshold that has been in place from 2009. We must adjust this first — equity demands that,” Clarke said.

He said that pensioners, aged 65 years and over, will now enjoy a total income tax threshold of $1.5 million plus the $250,000… and the threshold for those aged 55 and over will be $1.75 million.

Noting that individuals 65 years and older who are in receipt of a pension are also entitled to age relief exemption of $80,000, the minister said that this was also introduced in 2009, and “equity demands that we change this first”.

“We are leveraging macro stability to the people’s benefit. We have $1 billion built into the budget to increase public sector pensions,” he said.