No final decision on pensions changes, says authority

The General Pensions and Security Authority has denied reports that the age of retirement will be raised and pension funds deductions increased.

ABU DHABI // The General Pensions and Security Authority (GPSSA) has denied reports that the age of retirement will be raised and pension fund deductions increased.

“The retirement age is still 60 and not 65 as the circulated reports claim,” said Mohamed Al Hameli, the acting director of the authority.

“Anyone who retires before the age of 60 would have opted for early retirement.”

Reports also claimed that pension fund deductions would increase from 5 per cent to 15 per cent in four years.

“We at the authority cannot affirm what the deductions are going to be,” he said. “They might be 5, 6, 10, 15 or even 18. A specialised committee that is discussing the amendments to the law will decide that.”

The authority said it is hoping to make “foresighted decisions that would benefit the overall community for the next 75 years”.

“The authority is not a legislating body,” Mr Al Hameli said.

“All of those amendments will need to be discussed by the Federal National Council. What we’ve proposed are only the pillars but the clauses and all the details will need further studies and discussions.”

Amendments to the pensions law of 1999 are also being discussed by several governing bodies, including the Cabinet and the Ministry of Presidential Affairs.

Large social benefit differences between the private and the public sectors will need to be bridged, they said.

“One of the main reasons for those changes is to bridge the gap between the benefits and obligations of the public and the private sector,” Mr Al Hameli said.

“The current law gives way more benefits to the public sector. Those differences need to be addressed to encourage citizens to join the private sector.”

Another proposed point of discussion is the issue of fines of 2 per cent to institutions that are late to pay the amounts for those covered.

This will help secure the benefits of those being covered under social security.

Mr Al Hameli urged citizens to have a broader mind and to think of the overall benefits of the new amendments.

“Citizens should be thinking of the greater benefits of the country as a whole,” he said.

“We are all in this together and it is of all our interest to serve our country. Citizens’ rights are secure and will never be lost.”

The country’s guidelines encourage citizens to work for a longer period, Mr Al Hameli said. This enables the government to benefit from its citizens’ experience.

Last week, inaccurate reports circulated online about the proposed amendments and upset citizens.

Saeed Al Ahbabi, 41, a Government employee, was one of those upset with the purported changes.

“I was surprised by those amendments,” he said.

“I know people that considered retiring early before these changes take place.”

“Currently, Dh2,000 is deducted from my salary every month. I was alarmed to read that deductions were going to increase to 15 per cent.

“This would mean an amount of Dh6,000 to Dh7,000 might be deducted from my salary. With rising living costs and mortgage payments, this causes a big conundrum for families.”

Shamma Khalaf, 33, an eligible voter in the upcoming FNC elections, said that the issue of pension funds will need to be addressed by the council.

“This is a pressing matter for many,” she said.

“The deductions, and eventually retirement decisions, all depend on it.

“I’m glad to hear that the decision is not final but I hope it won’t be drastic and will take into consideration the repercussions these changes will cause.”