After several consultations with representatives of the labour unions to discuss proposals to facilitate its objective of creating much-needed fiscal space, Government has proposed the Barbados Optional Savings Scheme (BOSS).
During his presentation on the BOSS last evening at the Lloyd Erskine Sandiford Centre, Government’s Senior Technical Advisor, Dr. Kevin Greenidge, explained that the “win-win” 18-month programme is designed to repurpose government’s expenditure, in an effort to push capital programmes that do not directly relate to tourism; for example, road works, the Barbados Water Authority’s vineyard project, the refurbishment of schools and the digitization of the public sector.
He further explained that the benefits of repurposing expenditure under the programme would create more jobs and complete urgent construction works without further impacting the current fiscal targets.
This, Dr. Greenidge stated, would put as many people back to work as possible, thereby easing the burden on Government to finance unemployment benefits claims.
The Senior Technical Advisor emphasized that public sector workers will have the option to ‘opt-in’ or ‘opt-out’ of the BOSS Programme. Those who choose to ‘opt-in’ can do so, on a full or partial percentage basis and will still receive their full salary.
However, a portion of their salary would be paid in cash and a portion in bonds. These bonds, he noted, could be easily and seamlessly converted into cash if needed, once the public officer exercised that option.
The programme proposes that persons working for less than $36,000 annually will not be asked to participate, however, they can volunteer if they so choose.
Remaining public sector employees who earn between the following ranges after NIS and PAYE has been deducted, will receive their salary as follows:
|Salary Range Annually||Receive in Cash||Receive in Bond|
|36,000 – 50,000||93||7|
|50,000 – 100, 000||88||12|
|100,000 and over||83||17|
In his presentation, Dr. Greenidge outlined that pay slips will show payment from the Treasury for the cash portion and payment from the Central Bank of Barbados for the bond portion.
The bonds, which will have the principal paid in four years from the initial date, will attract a five per cent interest rate, with interest accruing in six month increments.
Recognizing that some persons may need to have access to all their funds each month, in those instances, Dr. Greenidge noted, provision has been made for public servants to seamlessly convert bonds into cash.
“Similarly, an employee may wish to increase or decrease the percentage received in bonds, and whichever option the employee choses, they must indicate their choice before their payday.
“If the employee wishes to receive all his/her monies in cash, this will be accommodated at par conversion (a $1 Bond converts into $1 cash). Please note that conversions of bonds after payday may incur a small discount as the employee would have already benefited from some of the interest on the Bond,” the advisor stated.
The public was also given the assurance that Government will not change the terms and conditions once the programme has started.
“The Constitution of Barbados protects the salaries of government employees so no matter what rates the bonds may trade at, it cannot fall below par at the time it is issued to the employee,” it was noted in the presentation.
To download further details on the BOSS programme you may click here.