The Ministry of Finance, on National Heroes’ Circle in Kingston. (Photo: Bryan Cummings)
Ministry of Finance and the Public Service and public sector trade unions have started discussions in an effort to resolve issues affecting the pension reform bills, and to pave the way for commencing negotiations on a new wage agreement.
The parties met at the ministry on Friday, and focused mainly on the passage of one of the pension bills, the Pensions (Public Service) Act of 2017, which facilitates a new system under which permanent government employees will contribute to their pension.
The second bill, the Constitution (Amendment) (Established Fund) (Payment of Pensions) Act 2017, facilitates a constitutional change to provisions which currently protect the right of public employees to a non-contributory pension paid from the budget. The bills were first tabled in the House of Representatives on November 15, 2015. They were eventually passed in the House in April, this year.
Under the pension reform measures, the five per cent contribution from the public sector workers would eventually go into a segregated fund, to which the government would also contribute, and which is expected to accommodate investments in the country’s economy.
The unions, including the Jamaica Confederation of Trade Unions (JCTU), have expressed concerns about the possibility of their contributions ending up in the government’s consolidated fund, if the establishment of the segregated fund is delayed. They are also concerned about when the government would start making its contribution to the segregated fund.
The public sector workers should have started contributing to the pension fund from April this year, but Minister of Finance and the Public Service, Audley Shaw, informed the House of Representatives in April that they would start paying 2.5 per cent in April 2018, and the full five per cent in April 2019.
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