I recently attended a consultation by the NIS and the discussion was eye-opening. I learnt more about the workings of the NIS in 3 hours than I have in my entire professional life. I don’t know if it’s my fault for not investigating the body or the NIS’s lack of public relations or maybe it’s a mixture of both. Nevertheless the consultation was educational to say the least.
According to data submitted by the NIS, in 2016, for the first time in the existence of the scheme the expenses of running the scheme was more than the income collected from the members. This came as no shock to the Board of Directors as this was foretold by the actuaries. This came as a shock to me as this was the first time I had heard of it.
What was even more shocking is the fact that the Board waited 3 years (2016-2019) to let the public in on this worrying information. In years that followed the gap between contribution income and expenses has only widened.
Why did it take so long to tell the public? I believe the answer lies in the fact that we were 2 years away from another general election. The powers-that-be didn’t want to alienate the voters that they needed to secure another 5 years in office. Baffling is that the labour representatives on the Board of Directors remained quiet. Whose welfare are these men looking after? Can’t be the employees they are supposed to represent.
In light of a MOU that was signed in the dead of the night hours before a general election and now this, question needs to be asked of our Trade Union leaders as to where their loyalty lies.
Much was said by a speaker at the consultation about the drop in birth rates leading to fewer workers in the economy and the increased life expectancy meaning pensioners are living longer as the major contributory factors responsible for the woes faced by the NIS. But that’s only half of the story. That’s the easy part – shift the blame to the people and you can get away with murder.
But there is another side of the story, a side that the directorate is unwilling to engage in. How has policies of the present administration affected the NIS? Is there anything the government can do besides pay contributions to ensure the survival of the scheme?
In an economy that is said to be the fastest growing economy in the Caribbean how can the scheme be in trouble? In an economy where the unemployment has dropped from 40% to 20% shouldn’t there have been some positive impact on the scheme?
There is only so much the public can do and the use of fear tactics such as your kids will have to pay a contribution rate of 44% later on can only go so far. Why is the directorate of the board so unwilling to engage government in discussions regarding the scheme?
There is an immediate need to increase the contributions paid to the scheme and there are 2 policies of the government that directly contradict this aim.
Firstly, there is the penchant of government to hire retired officers in high salaried positions. According to the Director of the NIS, whenever a pensioner comes back into the workforce there is only a 1% contribution to the scheme paid by their employer. Cain retired at 60 and started receiving his pension from the NIS. Five years later he is offered and accepts a position with the government.
This position comes with a salary of $8000. At this rate of 1% the NIS receives a mere $80. Had this position gone to someone else the scheme would have received $720. The NIS therefore has lost $640 because of the action of the government.
Secondly, the government is populating the nation with Imani workers. An Imani receives a stipend that is far lower than what that person would have made had they entered the labour force on their own. This means that an Imani’s contribution to the NIS would be lower than a worker doing the comparable job.
Is the directorate of the NIS bold enough to challenge the government on these points that directly affect the working of the scheme?
There are a few other points that can be made concerning the government’s role, for example:
* Creating the environment in Grenada to ensure that our workers come back and work here after going abroad and study and thus contribute to the NIS. To also make changes to its employment policies such that we prevent our workers from migrating and contributing to a foreign social security scheme. Last year over 80 nurses left Grenada to take up employment in England.
* Providing incentives to young entrepreneurs to start businesses and thus creating employment for themselves and others. Foreign investors can’t be the only beneficiaries of tax breaks and other government incentive packages.
There is no sorting out the issues plaguing the NIS without the help of the government and its going to take more than a willingness and ability to the 5% contribution on the behalf of the workers.
The workers are already saddled with 20+ additional fees, taxes and levies from the structural adjustment period. The period of adjustment has passed but the belt tightening measures have not expired.
There needs to be a loosening of the belt to motivate workers to rally around the call to raise the age of retirement and contribution rate.
Is it fair, moral and righteous to ask the people already powering the fastest growing economy to put out more? Is it right to ask them to dip into their pockets to give out more without first releasing some of the pressure that they are living under?
How can we say we are doing right by the ordinary workers when we are consigning many of them to poverty? Do not forget that these are the same workers that are going to shoulder the burden of National Health Insurance next year please God.
The tragedy of the NIS saga is that the Labor Unions and government are in a legal battle regarding gratuities and pensions. And so workers are not sure if they are going to receive a government pension and if they do receive one, the size of the emolument.
The NIS pension is the sure thing, the one we could look forward to. Now we are told that if nothing is done, by 2035 the reserves of the NIS will drop to zero. On the basis of that fact only, workers should support changes to the scheme to ensure that they do not retire to poverty. Yet the board has to engage the government to incentivise the changes.
We have no right to ask workers to make further sacrifices without giving them something back for all the sacrifices they have made before. I call on the labour unions and the directorate of the board to ensure that the government does its part to see that the NIS remains viable. This is not a workers only issue so let’s stop pretending it is.