FRUSTRATED by persistent delays across several regulatory touchpoints, president of the Pension Industry Association of Jamaica (PIAJ) Sanya Goffe is calling for more timely decision-making from oversight bodies.

She stressed that the industry is not seeking shortcuts or special treatment but rather faster follow-through on issues for which there is already broad consensus. The association’s growing frustration comes as the finance ministry has stalled the automatic pension enrolment plan proposed by the PIAJ last year, a policy reform aimed at increasing pension participation. The delay, Goffe noted, is only compounding other challenges the group has been lobbying to address through legislative changes. While collaboration between the PIAJ and the Financial Services Commission (FSC) has led to some progress, Goffe pointed out that significant issues persist, including a shortage of specialists in pension auditing and unresolved legal questions around the winding up of pension plans. “We’ve written to the FSC on this and await the draft bulletin, due by the end of this month, which we hope will provide the clarity our trustees, pension advisors, and, most importantly, plan beneficiaries need,” Goffe said while making her address at the PIAJ Annual Luncheon at the Pegasus Hotel in Kingston on Wednesday.

She also addressed the long-standing issue of securing withholding tax refunds from Tax Administration Jamaica (TAJ), a matter the association has been trying to resolve for nearly a year. Despite multiple attempts at engagement, the PIAJ only recently secured a meeting.

“Why are pension funds waiting so long for their money?” she questioned. “We finally have a meeting scheduled for June 26. No predictions, but we’re hoping for some resolution on the matter.”

However, Finance Minister Fayval Williams responded, noting that while the legislative process is lengthy, the pension reform agenda is nearing completion. She said the legislation remains a priority for this fiscal year under what is known as the “Adequacy Phase”, a stage that has already been reviewed by the Attorney General. She, however, cautioned against halting the current progress, explaining that doing so would risk further delays.

“Knowing how legislation works, you don’t want to stop something when it has gone as far as it has, because now people have to reread to make sure it fits into the whole rubric, and it might take an even longer time before it’s implemented,” Williams warned.

She further clarified the absence of automatic enrolment in the current legislative package.

“If you see phase two advance to Parliament and there’s no automatic enrolment in it, it’s because we just want to keep that going to completion and then circle back to put in the automatic enrolment,” she explained.

Although private pension assets have reached an all-time high of $811 billion, marking 14 consecutive years of growth, coverage still remains low. The FSC’s 2024 Pension Industry Report shows a slight decline in active contributors, from 11.79 per cent in 2023 to 11.63 per cent in 2024. This indicates that just over one in 10 employed individuals is participating in a formal pension plan.

“This is not just a retirement gap, this is a looming national risk, one that demands a whole-of-society response,” said Williams.

To address the issue, she said the Government remains committed to reviewing the proposal for a national auto-enrolment system that would enrol eligible employees by default while preserving their right to opt out. She believes automatic deductions would be effective in helping workers save.

“When one is required to do something, it generally happens, rather than one being left up to make the decision,” she said, adding, “Having employers deduct from your pay will work, because people will always find usage for the money, and when you look five years down the line and see the savings, they will feel more encouraged.”

Micro pensions are among the proposals put forward by the PIAJ to expand retirement coverage to workers in the informal sector who operate outside of traditional employment arrangements.

“I think we need to get to the point where we don’t make this distinction anymore between traditional and non-traditional employment… Work is work,” Williams noted.

The finance ministry is currently working with the Financial Services Commission (FSC) to design flexible, culturally relevant, and technology-enabled micro pension schemes tailored to meet the needs of these workers. Williams noted that the pension system should become a pillar of inclusive prosperity and form part of broader efforts to reduce old-age poverty, stabilise economic consumption, and lessen the long-term fiscal burden on the State. She reminded stakeholders that a secure retirement is not a luxury but a right and a reward for a life of work. As part of the adequacy phase of reforms, the Government also plans to strengthen and modernise private pension plans. The proposed changes include locking in compulsory member contributions, providing benefits from employer contributions, ensuring the portability of pension benefits between jobs, introducing dependant disability pension provisions, and allowing early withdrawals in specific cases such as terminal illness or severe financial hardship.

“Let’s reimagine retirement in Jamaica not as a distant hope but as a realistic promise. Let it not be that persons have to fully depend on their children to be their retirement,” Williams said.