National Insurance Board National Insurance Board National - - PDF document

Bernard Smith- Manager Research & Development

National Insurance Board National Insurance Board National Insurance Board National Insurance Board

• f Trinidad & Tobago (NIBTT)
• f Trinidad & Tobago (NIBTT)
• f Trinidad & Tobago (NIBTT)
• f Trinidad & Tobago (NIBTT)

ILO TRAINING COURSE ON SOCIAL PROTECTION AND FORMALIZATION 14-17 March 2017 - Port of Spain, Kapok Hotel

Overview of Social Security Overview of the NIBTT Financing Provisions NIS Benefits Benefit Improvements Self Employed Financing Provisions

This Presentation Will Cover

What is Social Security? Social Security Social Insurance

Social Welfare

System is based on the contributions of participants and benefit is not means- tested System is un-funded by beneficiaries and the benefit is usually means tested.

NIBTT Ministry of Social Development And Family Services

Social Welfare

The National Insurance Board of Trinidad and Tobago (NIBTT)

MISSION

"To deliver meaningful Social Insurance products and quality service to our customers"

VISION

"Excellence in the provision of Social Insurance products and Services"

National Insurance Board of Trinidad & Tobago

MANDATE

"To operate and manage the National Insurance System"

The NIBTT commenced operations 44 years ago on April 10, 1972

Financing Provisions

National Insurance contributions are compulsory for employees and

unpaid apprentices registered or eligible to be registered under the system

Contributions are weekly fixed payments in relation to wages/salaries of

the insured person determined under an earnings class structure.

Persons ≥ 16 years and ˂ 65 years earning a minimum of $200 weekly

are eligible for coverage

Payment of the contribution is done partly by the employer and partly by

the employee in an approximate ratio of 2:1.

Recent Changes to Financing Provisions

• 2. Maximum Insurable Earnings (MaxIE) and Minimum Insurable Earnings

(MinIE) are to be increased as follows: Year Contribution Rate 2014 12.0% 2016 13.2% Year MinIE (Per Month) MaxIE (Per Month) 2014 780 12,000 2016 867 13,600 These changes took effect on September 5th 2016.

*US $1.00 _ TT $6.79

The National Insurance Board of Trinidad and Tobago (NIBTT)

Earnings Class Weekly Earnings Monthly Earnings Assumed Average Weekly Earnings Employee's Weekly Contribution Employer's Weekly Contribution Total Weekly Contribution Class Z Weekly

I 200 - 339.99 867 – 1,472.99 270.00 11.90 23.80 35.70 1.79 II 340 - 449.99 1,473 – 1,949.99 395.00 17.40 34.80 52.20 2.61 III 450 - 609.99 1,950 – 2,642.99 530.00 23.30 46.60 69.90 3.50 IV 610 - 759.99 2,643 – 3,292.99 685.00 30.10 60.20 90.30 4.52 V 760 - 929.99 3,293 – 4,029.99 845.00 37.20 74.40 111.60 5.58 VI 930 – 1,119.99 4,030 – 4,852.99 1,025.00 45.10 90.20 135.30 6.77 VII 1,120 – 1,299.99 4,853 – 5,632.99 1,210.00 53.20 106.40 159.60 7.98 VIII 1,300 – 1,489.99 5,633 – 6,456.99 1,395.00 61.40 122.80 184.20 9.21 IX 1,490 – 1,709.99 6,457 – 7,409.99 1,600.00 70.40 140.80 211.20 10.56 X 1,710 – 1,909.99 7,410 – 8,276.99 1,810.00 79.60 159.20 238.80 11.94 XI 1,910 – 2,139.99 8,277 – 9,272.99 2,025.00 89.10 178.20 267.30 13.37 XII 2,140 – 2,379.99 9,273 – 10,312.99 2,260.00 99.40 198.80 298.20 14.91 XIII 2,380 – 2,629.99 10,313 – 11,396.99 2,505.00 110.20 220.40 330.60 16.53 XIV 2,630 – 2,919.99 11,397 – 12,652.99 2,775.00 122.10 244.20 366.30 18.32 XV 2,920 – 3,137.99 12,653 – 13,599.99 3,029.00 133.30 266.60 399.90 20.00 XVI 3,138 and over 13,600 and over 3,138.00 138.10 276.20 414.30 20.72

Earnings Classes & Contributions (based on 13.2% contribution rate)

Injury Allowance Medical Expenses Disablement Pension Grant Death Benefit Widow / Widower Child Dependant Parent Re-Marriage Grant Retirement Pension Grant Invalidity Survivors Widow / Widower Child / Orphan Dependant Parent Re-Marriage Grant

Long-Term Benefits Employment Injury Benefits

Sickness Funeral Grant Maternity Grant Allowance Special Maternity Grant

Short-Term Benefits

National Insurance Benefits

Coverage

Active Insured 519,926 Inclusive of 1,352 domestics

Key Labour Market Indicators

Indicator June 2015 December 2015 Unemployment 3.2 3.5 Persons with Jobs (000’s) 628.0 621.6 Labour Force (000’s) 641.1 643.9 Labour Force participation rate (%) 61.0 60.4

Extension of Coverage to Self-Employed

102,353 SEP in 2015 16% of labour force 37,715 SEP aged 50 and over Average earnings of $6,672 for males and $4,625 for females (2013)

Extension of Coverage to Self-Employed

Benefits proposed Long-term (retirement, invalidity, survivorship) Short-term (incapacity, maternity, funeral grant) Age credits for those aged 50 to 56 Co-payment of contributions for low-income SEP (earning less than $3,000 per month)

Extension of Coverage to Self-Employed

Age credits. It is estimated that the cost of the age credits is TT$108 million. When expressed in terms of general average premium, the age credits increase the GAP

• f

the SEP system for Long-term benefits (excluding administrative costs) from 10.87 to 11.04 per cent  Co-payment of contributions for low-income SEP. Estimated that the cost of the subsidy to low-income SEP (earning less that TT$3,000 per month) is TT$3 million in the first year of application and TT$44 million in total for the first 5 years. This includes the cost of the full subsidy during the first year.

Extension of Coverage to Self-Employed

Proposed contribution rate: 12.4%

12% for Long-term benefits and 0.4% for Short-term benefits Equity with salaried workers

Fund projections

10 20 30 40 2013 2018 2023 2028 2033 2038 2043 2048 2053 2058 2063 Billions SEP Salaried employees

Extension of Coverage to Self-Employed

Year Coverage rate 2015-16 15% 2016-17 20% 2017-18 30% 2018-19 35% 2019-20 40%

• - -

Linear increase From 2059-60 60% Projected coverage rate

Minimum Earnings & Pension

As at the June 2015:

approximately 57,000 contributors or 11 percent receive earnings below the

minimum wage

A social security minimum pension between 40% and 80% of the minimum wage is normally considered appropriate for taking care of persons with low earnings The NIS minimum pension of $3,000 represents 115% of the minimum wage (established at $2,600 per month) 97% of current pensioners receive the minimum pension, the NIBTT subsidizes the difference between what is actually earned based on contributions, and the minimum pension

3 Year Benefit Payments

Claims FY 2013 FY 2014 FY 2015 % Increase 2013-2014 % Increase 2014-2015 Beneficiaries 164,660 168,286 177,607 2.20% 5.54% Long-Term Beneficiaries 132,253 137,481 144,804* 3.95% 5.33% Benefit Expenditure $3.56 Bn $3,92 Bn $4.22 Bn 10.08% 7.66%

Long-Term Benefits

Benefit Type Beneficiaries Benefit Expenditure % of Total LTB % of Total LTB Retirement Pension 96,395 $3,362.09Mn 66.57% 86.10% Retirement Grant 4,568 $139.15Mn 3.15% 3.56% *Survivors Benefit 39,644 $329.01Mn 27.38% 8.43% Invalidity 4,197 $74.62Mn 2.90% 1.91% Total 144,804 $3,904.87Mn 100% 100% % of Total Beneficiaries 81.53 The long-term benefits (LTB) branch showed an increase in the number of recipients and in the value of benefits paid. This group comprises Retirement Pension, Invalidity and Survivor’s Benefit recipients Payment to this group totalled $3,904.97Mn or 92.63% of total benefit expenditure. *Survivors Benefit plus Survivors Grant

Questions?

www.nibtt.net

• Maternity, Special Maternity,

Minimum Retirement, Funeral

Improvements to the Benefits

NIS Grants

50%

Minimum Survivors’ Benefit Prior to March 2013 From March 2013 Comments Child $400 $600 Paid until age 16 (age 19 if a full- time student) Orphan $800 $1,200 Widow/ Widower $400 $600 Dependent Parent $200 $300 If both alive: $300 each Dependent Parent $300 $600 If only one alive: $600 each