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Pension, health insurance reforms hot topic for Chamber

Business 12 Jul, 2021 Follow News

Minister of Financial Services and Commerce Andre Ebanks, Premier Wayne Panton, Isaac Rankine, Chamber President Mike Gibbs

By Lindsey Turnbull

 

This year’s Legislative Luncheon at the Kimpton Seafire brought a packed audience together to hear about how the Government plans to lead these Islands out of the pandemic months and beyond. In his address to the audience, Chamber President Mike Gibbs outlined a variety of areas where the Chamber intends to work with Government to help get Cayman back on track once borders open and things get back to some kind of normality. But there were two particular topics that stood out as requiring the most urgent attention, that of pension and health insurance reform, both of which have the ability to greatly detrimentally impact anyone living and working, and eventually hoping to retire, in the Cayman Islands.

Mr Gibbs said that last year’s pension withdrawals demonstrated the success of the private pension system, with just less than half a billion dollars of withdrawals being made, the withdrawals providing much-needed supplementary income for many persons who were facing economic challenges as a result of the pandemic, and a much-needed boost to the local economy. However, he had words of caution.

“The withdrawals have, however, placed the Cayman Islands in a challenging position to determine what measures to enact to replace funds withdrawn,” he advised.

He said that last month, the Chamber Executive Committee met with a group of pension plan providers to discuss the situation. They presented a series of recommendations that the Chamber plans to share with the Minister for consideration.

“For many years, private pension reforms have been necessary and advocated by the administrators and it is therefore hoped that the current situation will lead to some practical decisions to revise the National Pensions Law and Regulations, as well as the investment guidelines, so that the pension system can be reshaped to its previous intended purpose to provide meaningful retirement income when it’s most needed,” he stated.

 

Health insurance needs overhaul

Mr Gibbs said that the escalating cost and limited choice of health insurance providers was creating significant duress on the private sector and especially among those who have reached or are approaching retirement age.

“Last week, a Chamber small business member reported that their premiums had increased by more than fifty per cent year on year. That increase for 12 employees reportedly added $100,000 in additional costs to that business this year alone. That increase is compounded by previous increases year on year. This is obviously unsustainable,” he confirmed.

Mr Gibbs said you truly knew the system was not working when persons who had contributed the best years of their working life had to decide whether they could retire in Cayman or have to move to another jurisdiction because they could not afford the health insurance plan.

“The Chamber plans to meet with the Minister responsible and the industry stakeholders, so we can work together to hopefully develop a reasonable solution to address this very serious matter,” he advised.


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