CABINET OKAYS BDF PENSION PLAN

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Past and present members of the Barbados Defence Force (BDF) will soon be eligible for pensions and other retirement benefits which have been approved by the Cabinet of Barbados.

This was announced today by Minister of State in the Prime Minister’s Office, Reverend Joseph Atherley, who noted that the matter had been a protracted one, with discussions going on between the BDF and government for sometime now.

According to the proposal, those BDF members who attain a minimum three years of service, will qualify for retirement benefits. Fifteen years of continuous reckonable service will be required in order to receive the proposed pension at age 45.  Reckonable service means service which is taken into account when completing the pension requirement and the terminal grant. It will include service prior to the implementation of the scheme, but is limited to a period of 300 months.

“Ultimately, I think we have come up with a proposal which has found the approval of Cabinet, but naturally the Ministry of Finance, the Supervisor of Pensions, the National Insurance Department, and the Office of the Prime Minister were all involved in the working group,” Rev. Atherley said.

The proposed pension scheme and retirement benefits also include remuneration for surviving spouses of persons who have died in the line of duty.

 “There will be a death benefit which is to be paid to the spouse of members. A cash payment equaled to the member’s final annual pensionable salary, plus an immediate pension paid to the spouse or dependants of the member’s choice.

For shorter periods of service, a proportionately reduced pension will also be paid. In addition to the death benefit coverage, the estate of members killed in the line of duty will be compensated by the Office of the Attorney General on the basis of five times the member’s annual salary at the time of death. This is a provision that also applies to the Royal Barbados Police Force,” he said.

The Minister further noted that all officers and other ranks serving in the regular force of the BDF “will be eligible to become members of the pension scheme.

Former members of the Defence Force who would have served for at least three years, will be paid a terminal grant and they are also eligible for retirement benefits under the scheme”.

Retirement benefits are expected to be calculated based on members’ full service. This will include service which was rendered in the force prior to the implementation of the plan. It will be a contributory pension benefit scheme and officers and other ranks will be required to contribute towards the cost of the pension plan.

“They will be provided the benefits once they retire, or if they leave the BDF before retirement under certain conditions, or if they die before leaving or retire from the BDF. The threshold set for the age of retirement from the BDF is age 45. Therefore, at that age all members will become eligible for an annual gross pension from the BDF,” Reverend Atherley said.

According to him, the pension will be paid in 12 monthly installments and there is a clear formula for its calculation.  There is also going to be a terminal grant which will be paid on retirement to members who have met the threshold criteria of three years of service and there will also be a formula for calculating this, depending on length of service which could range from 3 to 10, 10 to 15 or 15 to 20 years.

Minister Atherley pointed out that: “The pensions plan would become effective after the regulations are formulated in relation to the Defence Act, and this will be done by the Attorney General’s Office. “

He also revealed that members of the permanent cadre of the Barbados Regiment from November 23, 1978, will also be included in these benefits.

“Current members of the BDF, and former members as well will have their benefits increased in line with the cost of living adjustments accorded to government pensioners,” the Minister said.

In terms of contributions, BDF members will be required to pay 2.5 percent of their pensionable salary below the NIS ceiling, plus 7.5 percent of pensionable salary in excess of the NIS ceiling. Government will contribute the remainder towards the cost of the proposed plan. It is proposed that government will meet the full past service cost for members who served in the BDF prior to the implementation.

Members with less than three years service who do not meet the qualifying vesting period, will be refunded any accumulated compulsory contributions with interest. Those members who have left the BDF with three or more years of service will immediately receive the terminal grant. They will be refunded any accumulated compulsory contributions with interest.

Invalidity, in terms of disablement benefits, will be taken care of under the National Insurance provisions as is the norm. The issue of portability of pensions, which is the custom when some members of the BDF transfer to the public service is also addressed. “The proposed basis for transfer of years of military service to the public service will be one year of the BDF service to 1.335 of the public service. This is because of the higher accrual rate of 2.6% in the BDF, as opposed to 2% in the public service,” the Minister said.

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