Ashford W. Meikle, Staff Reporter
Executive Director of the FSC, Bryan Wynter. - CARLINGTON WILMOT /FREELANCE PHOTOGRAPHER
THE FINANCIAL Services Commission (FSC) has been flooded with a barrage of complaints from pensioners and participants in superannuation schemes since the Pensions Act was passed by Parliament last September, said executive director of the FSC, Brian Wynter.
"Since March 1 when the act came into effect the FSC has received numerous complaints and concerns ... The alleged circumstances, which have given rise to these complaints, reflect a full range of problems, which are confronting the pensions industry," said Mr. Wynter while speaking on 'The Role of the FSC as regulator' last Thursday night at the Kiwanis Club of North St. Andrew's monthly meeting held at the Hilton Kingston Hotel in New Kingston.
Some of the problems highlighted by Mr. Wynter include:
Members being threatened because they refuse to sign documents to which they were not in agreement with or which they did not understand
Undue delays in the payment of benefits.
Failure of the sponsor over a number of years to pay over ... employee contributions.
Information being withheld from members who are not told certain things.
Pensions plans being inactive for years and the trustees cannot be located.
Pension funds being terminated and members not being refunded their contributions, or mature benefits not being paid.
Surplus amounts attributable to members in continuing plans or in terminated plans have and are still being refunded to employers.
Frozen benefits because pensioners refuse to accept cheques.
Pension plans in deficit.
Pension funds being used to gain control in other entities.
Members ignorant of entitlements under pension plans.
Haste in winding up plans so that surplus can be distributed without scrutiny by the FSC.
"It's a long list [of problems] and we have just started. The [problems] are very real," he reflected.
The FSC boss told the audience that the pensions regulations were long overdue. "The new pensions legislation and new regulations will provide an appropriate regulatory framework to address these issues by ensuring that proper governance and oversight of the private pensions industry occurs in Jamaica. It also brings to Jamaica and Jamaican workers the benefits of international standards of regulations. These are challenges to meet."
Under the legislation the FSC will be responsible for the supervision of private pension arrangements, trustees, investment managers and administrators. The Act will regulate some $100 billion in pension assets in Jamaica.
Mr. Wynter said it was important to enforce the Act because it was important that the "retired Jamaican worker [does not] live in penury." But, he issued a caveat. "Until the regulations are in place the powers and regulations under the Act are for the most part ineffective. "We are powerless to do anything with these cases except to look into them and we rely on the cooperation of trustees to respond to us and when they do then we are able to get to the root of the problem."
Mr. Wynter praised the majority of superannuation schemes. "The industry is large...there are lots of pension plans. ...The vast majority is doing a conscientious job. They are doing about as well as can be done."
THE ACT INCLUDES THE FOLLOWING PROVISIONS :
Registration and approval of superannuation funds and retirement schemes
Licensing of administrators and investment managers
Registration of trustees and responsible officers
Solvency standards
Winding-up of approved superannuation funds and retirement schemes
Amendments to trust deed and plan rules
Fit and proper criteria.
Source: Financial Services Commission (FSC)
