ST. GEORGE’S, Grenada, August 28, 2019 (CMC) – The Grenada government has announced that the two percent increase in National Insurance contributions, due to have commenced in September, will now start next year.
“It will now commence, as of January 2020, because of adjustments that has to be made to government budget and all other employers,” said Nicholas Steele, Minister Responsible for Social Security.
The two per cent increase requires an amendment to the National Insurance Act and, during the last sitting of Parliament, the matter was not included on the Order Paper.
Parliament is expected to be prorogued, shortly, and officials say the amendment will be done during the new session of Parliament.
Trade, Industry, Cooperatives and CARICOM Affairs Minister, Oliver Joseph, announced, earlier this week, that Cabinet had approved the recommendation from the NIS board, following months of public consultations.
He said the board had recommendation an increase to the contribution rate, from nine to 11 percent.
“This is to be shared, equally, between employees and employers. The employers will be one percent additional and the employee one percent,” he said, while explaining that the current formula is for the workers’ contribution to be four percent, with employers set at five percent.
“If you wait until 2030 or 2035, it means that you will have to increase it by 22 percent then, so this is being done in an incremental rate, in keeping with the recommendation,” Joseph said, while informing reporters that the suggestion to increase the contribution was a recommendation from the actuaries, dating back to the early 2000s.
The NIS paid out EC$44.9 million in benefits during the first half of 2019, collecting during that period, EC$40.1 million.