Guyana Guyana Guyana Guyana Presentation to ILO Training Program: - - PDF document

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Guyana Guyana Guyana Guyana Presentation to ILO Training Program: Extension of Social Protection in the Context of Formalization Policies. March 14 - 17, 2017, Port of Spain, Trinidad and Tobago. The The Scheme Scheme covers covers

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Guyana Guyana Guyana Guyana

Presentation to ILO Training Program: “Extension of Social Protection in the Context of Formalization Policies”. March 14 - 17, 2017, Port of Spain, Trinidad and Tobago.

The The The The Scheme Scheme Scheme Scheme covers covers covers covers employed, employed, employed, employed, self self self self-

employed

employed employed employed and and and and voluntary voluntary voluntary voluntary insured insured insured insured persons persons persons persons between between between between the the the the ages ages ages ages of

f
f
f 16

16 16 16 and and and and 60 60 60 60 as as as as follows follows follows follows: : : :

Employed persons in both private and public sectors are covered

for all benefits

Self-employed persons are covered for all benefits except for

industrial benefits

Voluntary insured persons are covered for old age & survivor

benefits only.

Persons under age 16 and age 60 and over are covered for

industrial benefits only

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YEARS EMPLOYED PERSONS SELF - EMPLOYED EMPLOYERS New Entrants Total # Registered Active at the end of year New Registrants Total # Registered Active at the end of year New Registrants Total # Registered Active at the end

f year

All Ages Ages 16 - 59 2012 11,877 11,763 662,150 117,219 498 29,998 8,791 315 27,717 4,475 2013 10,622 10,545 672,772 118,548 486 30,484 9,017 338 28,055 6,507 2014 11,528 11,455 684,300 124,044 562 31,046 9,656 290 28,345 6,355 2015 12,017 11,951 696,317 128,487 772 31,818 10,002 379 28,724 5,441 2016 12,014 11,959 708,331 131,427 885 32,703 10,721 560 29,284 6,238

Contribution Contribution Contribution Contribution Rates Rates Rates Rates

Persons below 16 or over 60 years

1.5%

Self-employed persons

12.5%

Voluntary contributors

9.3%

Employed Persons

5.6% paid by the employee 8.4% paid by the employer

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The insurable earnings ceiling presented below came into effect from January 1st 2017. Employed:

Weekly insurable earnings ceiling

$50,769

Monthly insurable earnings ceiling

$220,000

Self-Employed

Minimum insurable earnings ceiling

$68,750

The monthly insurable earnings ceiling is approximately four times the current minimum wage in the public sector.

Benefit payments are broken down into the following categories Benefit payments are broken down into the following categories Benefit payments are broken down into the following categories Benefit payments are broken down into the following categories: Long Term Benefits Short Term Benefits Industrial Benefits

Long Term Benefits

Old Age Pension & Grant
Invalidity Pension & Grant
Survivors’ Pension & Grant
Funeral Grant

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Short Term Benefits:

Sickness Benefit
Sickness Benefit Medical Care
Maternity Benefit
Maternity Grant
Constant Attendance Benefit

Industrial Benefits: (Not paid to self-employed persons)

Injury Benefit
Disablement Benefit
Industrial Death Benefit
Injury Benefit Medical Care

Benefit Type Number of Pensioners Number of Pensioners at the Minimum Current Estimated Monthly Amount OAP 34,641 22,065 1,127,023,477 INP 573 351 17,511,239 SUP 11,898 9,164 164,445,602 DTP 260 164 4,523,201 47,372 31,744 1,313,503,519

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Evasion is significant among:

self-employed workers; young and low paid workers; domestic, casual and part-time workers; small employers, employers in the informal sector; employers who experience financial difficulties.

Employers evade the payment of contributions by falsely classifying

their workers as self-employed persons.

Employers under reporting the earnings subject to contributions and

exaggerating their allowances that do not attract contributions.

Employers delay to remit contributions at the statutory specified time. Employers fail to remit contributions which they have with-held from

their employees.

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Employers seek to reduce their labour costs. Current consumption needs lead workers to evade paying contributions,

particularly young workers who place a low value on future retirement consumption needs.

Reluctance to report a defaulting employer for the risk of loosing

employment if anonymity is not maintained.

Evasion creates inequities between employers that meet their contribution

bligations and those that do not, and similarly between employees who contribute

and those who do not.

When evasion is due to an employer failing to remit contributions deducted from

the wages of employees, the employees receive credits whether the scheme can recover the contributions from the defaulting employer or not. This causes delay in the award of the pension as investigations have to be conducted.

The scheme ultimately bears the risk.

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