THE GOVERNMENT yesterday announced a 66 per cent increase in benefits to National Insurance Scheme (NIS) pensioners, which it estimated would cost about $10 billion over four years.
Horace Dalley, Minister of Labour and Social Security, told Parliament that the rise, effective April 3, represented "one of the largest ever increases" in pension benefits. About 87,000 pensioners would be affected next year alone.
The increases will be paid out of the $42 billion National Insurance Fund (NIF) which, Minister Dalley noted, has been projected to grow by 40 per cent to a value of $60 billion by 2010.
"Rest assured, Jamaica, the NIF works for the pensioners of this country, and we feel it can be sustained," he stressed.
He said the increases would cost $2 billion in 2006/2007; $2 billion in 2007/2008; $2 billion in 2008/2009 and $3 billion in 2009/2010.
Mr. Dalley said the Old Age, Invalidity, Widow's/Widower's full basic pension would move from $900 per week to $1,500 per week.
BENEFITS TOO LOW
However, despite the relatively large increases in pensions and grants, Opposition members said the benefits remained too low and that they were particularly concerned about the Sugar Workers' Pension and the Funeral Grant.
"It is all well and good for the minister to come and to brag and to gloat about a 66.66 per cent increase, but what the minister has not told us is how much the inflation rate has raced along by," said Audley Shaw, Opposition Spokesman on Finance. He was echoing the concerns raised earlier by Shadow Spokesman on Labour, Ruddy Spencer.
Mr. Shaw claimed he was aware of a couple who, together, would receive less than one person's minimum wage when their new pension increases were calculated.
ANALYSIS FLAWED
Minister Dalley, however, argued that the analysis was "fundamentally flawed" as Mr. Shaw had failed to consider the level of contributions the couple may have made.
Other Opposition members, particularly Olivia 'Babsy' Grange, argued that the $30,000 to $40,000 increase in the funeral grant would do little to assist in burying loved ones.
"That is something I will look at to see if we can at a future date increase the funeral grant," Mr. Dalley said in closing the debate on the legislative order to increase NIS benefits.
He stressed, however, that Government checks had indicated that appropriate packages could be received at many funeral homes for $40,000. Mr. Dalley promised to address the concerns during the upcoming 2006/2007 Budget Debate.
Proposed Increases In NIS Benefits Allowances
Category of Benefits Present Proposed
Weekly Rate Weekly Rate
a) Old Age, Invalidity, Widow's/Widower's pension
| Full basic rate | $900 | $1,500 |
| 3/4 Rate | $675 | $1, 125 |
| 1/2 Rate | | $450 | $750 |
| b) Sugar Worker's Pension | $450 | $750 |
| c) Orphan's and Special Child's Allowance | $1, 575 | $2,625 |
| d) Dependent Spouse's Allowance | $300 | $500 |
(addition to Old Age and Invalidity Pension)
e) Special Anniversary Pension $450 $750
(for persons born 1906 and earlier
f) Maternity Allowance $2,400 $2,800
(payable for eight weeks to eligible domestic worker) (linked to National
Minimum Wage)
g) Employment Injury Benefit and Disablement
Pension $100-$1,740 $150-$2,015
Proposed Increases In Grants
| Category of | | Present | Proposed |
| grant | grant | grant |
| Funeral Grant | $30,000 | $40,000 |
| Old Age Grant | $8,100 | $20,000 |
| Invalidity Grant | $8,100 | $20,000 |
Widow's/Widower's
Grant $8,100 $20,000
Orphan's and Special
Child's Grant $14,625 $30,000
