Pension body CEO claims optional payment proposals endanger “social protection”

The CEO of the Pension Administration Office has attacked a proposed amendment to the 2009 Pension Act that would allow for optional payments into the scheme, claiming such a move would set back social protection in the country.

Haveeru today cited CEO Mohamed Hussein Manik as claiming  that although amendments may be needed to pension payments in the country, proposals forwarded by MPs to remove a mandatory seven percent wage payment from all state employees aged between 16 and 65 years would effectively undermine the scheme completely.

The claims were made following a week that has already seen changes made to the Pension Act; an amendment passed on Monday (April 11) served to delay inclusion to the pension scheme for expatriate workers employed within the Maldives by at least three years.

The sitting also saw an additional amendment proposed by minority opposition People’s Alliance (PA) MP Ahmed Nazim to exempt MPs from the pension scheme, however this did not pass after 41 MPs voted against it, while 29 voted in favour and five members abstained.

In considering amendments to allow certain individuals to opt out of the pensions scheme, Manik stressed reservations about optional payments

The pension body CEO also told journalists that he believed considerations to allow the removal of  funds from a pension scheme before an employee’s retirement would endanger the long-term stability of the national payment plan.

According to Haveeru’s report, every state employee is required under the Pension Act to be registered into the payment scheme, with an estimated 37,708 public workers currently contributing.  Some 2,500 private employers have also registered to pay into the pension programme ahead of a deadline scheduled for May 1 this year.