Lowest APS pension payment is NAf. 33.25, highest NAf. 10,928 | THE DAILY HERALD

PHILIPSBURG–The lowest pension payment that the General Pension Fund Administrator APS makes to a retired civil servant is NAf. 33.25, while the highest is NAf. 10,928. Prime Minister Leona Romeo-Marlin provided the figures to Members of Parliament (MPs) during the continuation of a meeting of the Central Committee of Parliament on the draft National Ordinance for the Revision of the Pension of Civil Servants on Thursday.

  In responding to a question about the average pension pay-out for civil servants, the PM said the average pension payment from APS is NAf. 1,950 per month (gross). The lowest pension payment amount is NAf. 33.25 per month and the highest is NAf. 10,928 per month. According to the official publication from the Department of Labour, the minimum wage as of 2015 is set at NAf. 1,516 per month (gross). She said the average pension payment is therefore higher than the minimum wage. In addition to the pension entitlements from APS, a pensioner can also be entitled to the AOV from Social and Heath Insurances SZV.

  The AOV is based on the years a person has been registered/living in the country. This amount will be calculated based on the years that the person lived in the country based on the full amount of 45 years. “Based on the information we received about two years ago, the average pay-out from SZV is approximately NAf. 650.00 per month (gross) in comparison to the full amount of NAf. 1,086.00 per month (gross),” the Prime Minister said. “The total average amount a pensioner is receiving is therefore NAf. 2,600 per month (gross).”

  She said the accrual of pension is based on the salary and the years of service by the employer that is affiliated with the fund. These years are not linked with the minimum wage. “The mandatory aspect tackles this problem for a small part in the sense that there is an accrual of pension. Every employer should have some type of pension plan whereby the total cumulative amount of pension (based on the different years by the different relevant employers) should be higher than the minimum wage.”

  If passed by parliament, the pension age for civil servants will move from 62 to 65 as of January 1, 2019. Built into the draft ordinance is the possibility for workers to retire at the age of 62 if they want to. They will, however, receive a somewhat reduced pension.

  A fundamental change to the draft law is the shifting of the payment system into the fund from an “end pay” system to that of an “average pay system.” In the present end pay system, pension is calculated over the average pay of the worker over the last 24 months of their salary while in the proposed new system, pension will be built up every year based on the worker’s income for that year, which results in their pension being based on an average of their salary for their entire civil service career.

  Additionally, the law now makes provisions for an automatic and unconditional indexation of civil servants’ pensions. Once the coverage ratio reaches more than 105 per cent, there will be an automatic indexation of pensions. Currently, pensions are indexed based on the indexation of salary in government, but this will now be based on the financial situation of the fund and the cost of living in St. Maarten.

The draft also includes the possibility for civil servants to buy in extra pension at their expense.

  Once the law has been passed and it goes into effect on January 1, civil servants will roll over into the new system simultaneously and the current system will come to an end. Civil servants will retain all of the benefits that they have accrued in the current system up to January 1, 2019, and this will go over with them into the new system, and they will continue to build up their pension according to the new rules. There will be several exceptions. There will be no changes for persons who are already on pension and for persons who were born between January 1, 1957 and July 1, 1958, who are in the transitional arrangement when the pension age had been introduced from 60 to 62 in 2016.

  However, if the latter wants to be part of the new system, they can request for this to be done. All persons who roll over into the new system will receive 10 per cent of their already accrued pension rights and will build up further pension according to the new rules.

Source: The Daily Herald https://www.thedailyherald.sx/islands/83632-lowest-aps-pension-payment-is-naf-33-25-highest-naf-10-928