News / National
NSSA monthly pension goes up by 50%
12 Dec 2011 at 09:52hrs | Views
National Social Security Authority (NSSA) monthly pensions will be going up by 50 percent next year, raising the minimum monthly retirement pension payout to US$60.
Pensions for those who retire on a salary of up to US$1 000 a month will be calculated on the basis of their actual salary.
Those who retire in January 2012 earning US$500 a month and having contributed continuously to the scheme from inception will receive US$115.
And those who have contributed for the same period and who will be earning US$1 000 at the time they retire will receive a pension of US$230.
The minimum survivor's pension goes up from US$20 to US$30, as does the minimum invalidity pension.
The increase in pensions has been made possible by the gazetting last week of regulations increasing the insurable earnings limit for NSSA pension contributions to US$1 000 per month, as from January
2012, and increasing the employee and employer contribution rate from 3 percent each to 4 percent.
NSSA pensions are calculated by multiplying the insurable earnings of the pensioner at retirement by the number of years they have contributed by a factor of 1,333 percent.
The replacement value of the pensioner's insurable earnings increases with the maturing of the scheme and the increase in the number of years the pensioner contributed to the scheme. After 17 years the replacement rate is 22,6 percent.
The pensions of those who retired this year were kept low by an insurable earnings ceiling of US$200.
As a result, a person earning more than US$200 who had been contributing for 17 years only received the same pension as a person earning US$200, which amounted to US$45 per month.
As from January 2012 any pensioner whose entitlement, as calculated by the normal formula, would be
below US$60 will receive the new minimum pension of US$60.
Those who retire while the new regulations are in force will, if they have been contributing for 17,25 years and are earning US$263 and below, receive a pension of US$60.
Those earning above US$263 will receive more.
Contributors earning above US$1 000 will receive the same pension as those who are earning US$1 000, which, as from January 1 2012, will be the new insurable earnings limit.
The new regulations mean that from January employers will be required to deduct from each employee's salary 4 percent of the salary, up to a maximum monthly insurable earnings limit of US$1 000.
The employer will also be required to make the same 4 percent contribution and remit the total 8 percent of insurable earnings to NSSA.
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The contribution of those earning above US$1 000 per month will be limited to 8 percent of US$1 000 divided equally between employer and employee - that is US$40 from the employee and US$40 from the employer.
Pensions for those who retire on a salary of up to US$1 000 a month will be calculated on the basis of their actual salary.
Those who retire in January 2012 earning US$500 a month and having contributed continuously to the scheme from inception will receive US$115.
And those who have contributed for the same period and who will be earning US$1 000 at the time they retire will receive a pension of US$230.
The minimum survivor's pension goes up from US$20 to US$30, as does the minimum invalidity pension.
The increase in pensions has been made possible by the gazetting last week of regulations increasing the insurable earnings limit for NSSA pension contributions to US$1 000 per month, as from January
2012, and increasing the employee and employer contribution rate from 3 percent each to 4 percent.
NSSA pensions are calculated by multiplying the insurable earnings of the pensioner at retirement by the number of years they have contributed by a factor of 1,333 percent.
The replacement value of the pensioner's insurable earnings increases with the maturing of the scheme and the increase in the number of years the pensioner contributed to the scheme. After 17 years the replacement rate is 22,6 percent.
The pensions of those who retired this year were kept low by an insurable earnings ceiling of US$200.
As a result, a person earning more than US$200 who had been contributing for 17 years only received the same pension as a person earning US$200, which amounted to US$45 per month.
As from January 2012 any pensioner whose entitlement, as calculated by the normal formula, would be
below US$60 will receive the new minimum pension of US$60.
Those who retire while the new regulations are in force will, if they have been contributing for 17,25 years and are earning US$263 and below, receive a pension of US$60.
Those earning above US$263 will receive more.
Contributors earning above US$1 000 will receive the same pension as those who are earning US$1 000, which, as from January 1 2012, will be the new insurable earnings limit.
The new regulations mean that from January employers will be required to deduct from each employee's salary 4 percent of the salary, up to a maximum monthly insurable earnings limit of US$1 000.
The employer will also be required to make the same 4 percent contribution and remit the total 8 percent of insurable earnings to NSSA.
0
The contribution of those earning above US$1 000 per month will be limited to 8 percent of US$1 000 divided equally between employer and employee - that is US$40 from the employee and US$40 from the employer.
Source - TH
