NASSAU, BAHAMAS — State Minister for the Public Service, Pia Glover-Rolle yesterday noted that draft legislation for the much-anticipated reform of the public pensions scheme is nearing completion.
In her address during the 2023/2024 budget debate in Parliament, Glover-Rolle revealed that the Ministry of Finance is actively exploring the implementation of a Contributory Pension Plan that would provide substantial benefits to public servants. She noted that the draft legislation will soon be presented to public sector unions for their feedback.
“While we await the feedback, I am pleased to share the envisioned structure of this pension plan,” said Glover-Rolle. “Under the proposed scheme, the benefits will surpass those currently experienced under the existing plan.
“Furthermore, the benefits will be proportionate to the amount contributed by the public servant. In essence, the more an individual contributes, the greater their eventual benefits. Existing public servants will retain their entitlement to the current pension plan, in addition to the National Insurance Board (NIB) benefits. They will have the option to enroll in the new plan, thereby ensuring they receive the expanded benefits offered by the contributory pension plan upon retirement.”
Glover-Rolle emphasized that new public servants would be seamlessly integrated into the contributory pension plan, which guarantees improved benefits in a financially sustainable manner for both beneficiaries and the government.
“The plan is designed to be portable,” she continued. “This means that if an individual commences their career in the public sector but later decides to explore opportunities in the private sector, they can carry their pension plan with them. They may even choose to contribute additional funds, thus enhancing their retirement benefits. This forward-thinking approach will establish a modern pension plan for a modern Bahamas.”
The issue of pension reform has been a longstanding concern, with discussions dating back to the last Christie administration and the Minnis administration previously alluding to the introduction of a contributory pension plan in 2018. The government’s unfunded public sector pension liabilities are projected to reach a staggering $3.7 billion by 2030 if immediate action is not taken to alleviate this fiscal burden on Bahamian taxpayers.
Glover-Rolle also highlighted a few notable increases in the overall Public Service budget during her speech.
“We have allocated a 16 percent increase for permanent and pensionable public servants to facilitate the Minimum Wage increase, address salary discrepancies and adjustments, restore increments, and confirm the appointments of 122 high school and college graduates as valuable additions to the public service,” she stated.
Additionally, she mentioned a significant 39 percent rise in funding for Special Employment Projects, primarily allocated for the Public Service Professional Engagement Programme, which the government continues to prioritize.
