Last month Tara Rivers, Cayman Islands Employment Minister, launched her new Pension Bill that included administrative fines and letters of compliance. The retirement age was raised to 65 (thus making it harder for those seeking jobs) and increased the amount of pensionable earnings.

Instead of applying to the Courts to charge and prosecute employers who offend the Department of Labour and Pensions will be given the power to administer the fines and the letter of compliance has to be signed by the employer otherwise a Trade and Business licence will not be issued or renewed. Fines will be increased from $5,000 to a whopping $20,000 or a two-year prison sentence.

Anyone working 15 hours per week or less removes the obligation to pay into a pension scheme. The previous proviso of excluding domestic workers has not been changed.

Expat workers will be hit the hardest as they will not be able to draw their pension contributions and cash them in until they have left the Cayman Islands for three years. It was previously two.

There is also a requirement that fund managers will have to be more transparent and an increased frequency to publish pension performance.

I well remember when I drew my pension, because of the poor performance of the fund, I received less than what was put in!

Rivers has increased the maximum amount of money a person earns per year that is subject to mandatory contributions from $60,000 to $87,000. She said this combined with the increase in retirement age would increase the amounts paid into the funds.

However, will it all actually work if and when it comes into force?

There is no way the Department of Labour and Pensions can execute all this with its current manpower and the Civil Service has a mandate of cutting jobs not increasing them.

And what about the managers of the pension plans?

What about companies they go bankrupt?

What redress does the employer have when all is lost.

How often will checks be executed by the Department of Labour and Pensions to see all is well?

It is going to take a large workforce by government to address all these issues especially as they also have the added burden of policing it and executing justice.

However, I applaud the minister for taking the steps to address the matter. If it was hard to get the draft bill together and now to take it around the country to explain and get people’s feedback, I fear it is going to be ten times harder to implement it unless additional government monies will be put in place. I don’t forsee that happening anytime soon.