NASSAU, BAHAMAS — While almost two-thirds of registered businesses make at least one payment to the National Insurance Board during the course of the year, only approximately only 40 percent of them make contribution payments on time according to Minister of the Public Service and National Insurance Brensil Rolle who told Parliament that many Bahamians endured long delays in receiving benefits because contributions and records were simply not up-to-date.
During his contribution to the 2020/2021 budget debate Mr Rolle noted that COVID-19 exposed a number of challenges in the administration of social security in The Bahamas. “I am certain that it comes as no surprise to anyone that the issue of Compliance was a major challenge during this crisis. It is a problem that must be tackled,” said Rolle.
To improve compliance Rolle noted that NIB will be heightening its efforts in that regard going forward. “It will also increase its public relations efforts to impress upon employers, self-employed persons and employees that paying contributions is an opportunity to prepare for retirement, and to benefit from the short-term replacement of lost income. NIB has already taken steps to change the structure of the Compliance Department, including the use of more technology and data to improving contribution collections.”
He added, “Compliance is not just paying contributions as many think. And I heard many, many people complain that their employers paid their contributions, or even employers stating that they paid their contributions, yet benefits to employees were slow in coming. Compliance with the National Insurance Contributions law requires that employers pay contributions and pay them on-time. Further, it requires them to submit records and submit them on time. Many Bahamians endured long delays in receiving benefits because contributions and records were simply not up-to-date.”
Rolle noted that no one will be denied benefits because of his/her employer’s failure to comply with the law. “However, even in this, the records of contributions payable must be confirmed. That too was a challenge.I have received reports of employers paying contributions for months – years at a time – and paying them after employers were laid-off in March. It is disingenuous to charge that you are in compliance when you clearly are not,” said Rolle.
He continued, “There is more to compliance than paying contributions once every six months, or once a year or less often than that! When contributions are paid as prescribed, it is a fairly simple matter to properly assign those contributions to the individual worker’s accounts. However, when employers batch-pay as so many have been doing for years, it creates a serious backlog – not to mention the negative financial implications for the Fund. To function properly, our social security programme needs everyone playing his part. I say that employers have a sacred duty to their employers, but employees also have a duty to themselves. Employees must take a more active interest in their contributions. They have had the ability to view their contributions history online since 2014; doing so secures for them a level of comfort in knowing that contributions are being paid on their behalf, and consequently their benefits are secured and available when they need them. It also gives them the opportunity to address, together with NIB, any failure or omissions on the part of employers to pay contributions.”
Rolle noted that going forward, NIB will be requiring of employers with 10 employees or more to submit electronic C10 forms. “This will enable faster posting of the records. NIB will also be proactively prompting employers when records have not been submitted for a particular month. NIB has now created new IT tools which allows for this prompting and billing mechanisms to be launched shortly.”
According to Rolle it is estimated that more than 30,000 workers had an interruption or suspension of earnings over the past three months due to the COVID19 crisis. He noted that during March, April and May, NIB made payments to pensioners which accounted for a major infusion into the economy of some $67 million in the midst of the economic downturn and in the immediate months, with these payments were made earlier than normal.
Rolle noted that the combination of electronic claims submission and the expedited special arrangements proved to be a success, as some 23,000 unemployment benefit claims were processed within the first six weeks of the shutdown, compared to an average of 7,000 such claims per year.
“Through the V3 insurance administration system, there were 9,284 applicants approved and paid; with some 20,088 total disbursements made, in an amount of $11,678,126, to date. There were, however, a much larger number of claims processed under the expedited UEB processing method There were 24,917 applicants that were approved and paid under this method, versus 9,284 in the V3 system; with 62,048 disbursements made with a payout amount of $38.1 million as of June 9, 2020. Combined for the ordinary NIB unemployment benefit, over 34,000 claims have been processed and payouts have amounted to about $49.8 million,” said Rolle.
Speaking to the government unemployment assistance which was administered via NIB Rolle said, “To facilitate the Government Unemployment Assistance (UEA) programme, the Board was able to stand up a new online portal within three days of the tourism sector shut down. This initiative significantly reduced the need for on-site customer visits and shifted the business model from paper-based to e-based. NIB, through this online application, was able to receive and process thousands of applications for self-employed persons in a few short weeks. I am pleased to report that as of June 9, 2020 – 6,763 applications have been approved and paid; total disbursements made are 24,059; with total payments standing at $9,084,705.”