Seychelles Pension Fund prepares white paper on foreign workers paying into fund

Once all the information is gathered, SPF will present the whitepaper to the cabinet of ministers in June.

(Seychelles News Agency) - Foreign workers in Seychelles who are not contributing to the national pension fund may soon have to start, according to a white paper being formulated to include them in the pool of contributors as part of measures to keep the fund viable.

The announcement was made on Monday by the chairperson of the Seychelles Pension Fund (SPF), Marc Hoareau, who said that "we have been asked to come up with a white paper by June in regards to foreign workers paying into the fund."

SPF said it will be working with the employment department as well as the National Bureau of Statistics (NSB) to get the exact figures of foreigners working in Seychelles and find out their precise earnings.

Once all the information is gathered, SPF will present the whitepaper to the cabinet of ministers in June.

Before presenting the amendments, SPF had been holding consultative meetings with members of the public and union representatives among others.

Another means of bringing in money to the fund that the SPF is working on is to establish mechanisms that will allow Seychellois living overseas to make contributions to the fund.

"People overseas who decide to make their contributions to SPF, it will be their choice as it will be voluntary contributions," said Houareau, explaining that it would be a savings instrument for them.

The new measures are part of SPF's solutions to keep the fund viable amid concern for its solvency given the rise in the life expectancy rate in Seychelles.

Seychelles, an archipelago in the western Indian Ocean, has a population of over 99,000 with a life expectancy of 77 years according to figures from the National Bureau of Statistics (NBS).

Last Wednesday, the cabinet maintained the increase for the SPF pension contribution from 3 to 4 percent of salaries for employees and 3 to 5 percent for employers effective April 1.

Pension contribution for self-employed workers will increase from 6 to 9 percent from April 1 and to 10 percent from January 1, 2023.

The cabinet also maintained its position to raise the retirement age for the SPF pension from 60 to 65 years from January 1, 2023, and introduce an early retirement mechanism for retirees in the age bracket of 60 to 64 years.

Meanwhile, SPF actuaries are expected to arrive in the country in May. The latest visit from the Canadian actuaries is part of the SPF Act which mandates their involvement every three years to assess the fund and make recommendations to keep it viable.

SPF provides the actuaries with its own databases as well as the information it collected from the NSB in order to produce the report.

Houareau revealed that the reason for the latest increase in the percentages contributed to the fund was due to the last actuary report produced in 2018 – which recommended the increases that have taken effect as of this month.

When asked whether there will be further increases after the actuaries have completed their assessment, SPF chief executive Nisreen Abdulmajid said that there are different factors they will have to take into account before making their final decision.

"It is sure that with the adjustments that have been made, if there were to be further adjustments for the coming year, there is a chance that it will be postponed – again depending on the results" she added.

SPF said it will receive the report by the end of this year or in the middle of 2023.