$39 Billion in NIF at March 31

The National Insurance Fund (NIF) continued to perform during 2004/05, with investment income growing by 23 per cent and a $39 billion balance. This was stated by Labour and Social Security Minister, Horace Dalley, during his contribution to the 2005/06 Sectoral Debate in the House yesterday (May 17).
The Minister said new investment options were being explored for 2005/06 to contribute to stimulation of economic activity. As such, he said any group with bankable project ideas were being invited to approach the NIF.
Mr. Dalley informed that a proposal was currently being developed to assist small businesses and micro enterprises, adding that with research already showing that more than half of the labour force was in the informal sector, it was “critical that this segment of the economy be supported to generate increased viability and job creation”.
Addressing concerns about the limit on the payment of National Insurance pension arrears for late claims, Mr. Dalley told the House that at present, arrears are paid for one year. Explaining this arrangement, he said that pension fund managers have to be certain of liabilities and future obligations, and in cases where the provision for arrears was open ended, this became difficult. He noted that in other jurisdictions, the limitation for arrears ranged between three and six months.
Pointing out that Jamaica had in place reciprocal Social Security agreements with other countries, including Canada, the United Kingdom and CARICOM partners, Mr. Dalley said it was imperative that the country’s legislation be consistent to ensure equality of treatment. As a result, he said the limitation “would remain in force”, but noted that the law made provisions for the use of ministerial discretion in “extenuating circumstances”.
Where the National Insurance Scheme (NIS) was concerned, the Minister said the coverage gap, which resulted from the large percentage of the labour force in informal employment and not contributing to the scheme, contrary to the provisions of the NIS Act, continued to be a concern.
Mr. Dalley said notwithstanding this trend, increased participation of informal sector workers in the NIS was anticipated, based on the launch of a rigorous public education drive promoting awareness of provisions of the scheme and highlighting initiatives, which improved its attractiveness.
The latter, he informed, included periodic increases in benefit levels and the recent enhancement of the scheme by the introduction of a pensioner’s health plan (NIGold), based on the “robust performance of the NIF”.
Mr. Dalley added that the introduction of the NI Gold health plan had proven to be a valuable enhancement to NIS beneficiaries, with a total of $232.8 million provided in benefits since its inception.