NWU OK with new pension scheme
Published:Tuesday | August 9, 2011 | 12:00 AM
Daraine Luton, Senior Staff Reporter
Vincent Morrison, president of the National Workers' Union (NWU), says the organisation he leads would support the establishment of a contributory pension scheme in the public sector.
"In spite of the difficulties and challenges that the workers will face with a five per cent or less being deducted for their pay for pension contribution, we would not have a problem with that aspect of it," Morrison told The Gleaner yesterday.
Finance Minister Audley Shaw on Sunday, in an address to the nation, reiterated Prime Minister Bruce Golding's position that pension reform in the public sector is critical to lowering the public-sector wage bill.
"The rapidly escalating cost of government pensions has a significant impact on recurrent expenditure. Exhaustive studies on pension reform have been completed and a Green Paper outlining the proposed reforms will be tabled in September. This is expected to lead to a White Paper in January 2012," Shaw said.
Won't stand in way
Yesterday, Morrison, whose union is aligned to the Opposition People's National Party, said the NWU was concerned about protecting workers' benefits but would not stand in the way of any move to establish a contributory pension fund.
"We are not going to close any windows, we are not going to close any door. We are going with an open approach to see what exists and rationally, reasonably, tactically, do what is best," Morrison said.
He added: "The bottom line in any pension scheme is what you get when you go on retirement and if you look on the amount that people are getting, it is not that people are getting a whole heap of money for pension."
When he addressed Parliament during the 2011-2012 Budget Debate, Golding said pension costs for the public service stood at $12 billion in 2007.
"This year, it has ballooned to $22 billion. A recent study commissioned by the PSOJ suggests that the cost of pensions for those who have already retired will be $225 billion for the rest of their lifetime. That figure increases each year as more people retire," the prime minister noted.
He added: "A team of World Bank consultants has completed a review of our public-sector pension arrangements. Not surprisingly, they have recommended that the current system be replaced by a contributory pension scheme to which both the Government and the individual employee would make contributions."
Trade unions representing public-sector unions are now discussing issues relating to public-sector wages and benefits.