Financial Managers Suggest NIB Rate Increase

NASSAU, BAHAMAS – Two financial managers weighing in on the conversation surrounding the NIB fund facing a projected depletion by 2028. While one says at its current rate the fund is not sustainable, another is saying take emotions out of it.

Royal Fidelity Group President Michael Anderson is suggesting national insurance contributions be increased.

He says with all the benefits offered by NIB, it will only be able to continue if contributions are raised.

Royal Fidelity offers supplementary pensions which adds more pensions in addition to the one offered by NIB.

Anderson’s comments come weeks after Prime Minister Philip Davis said despite a report recommending an increase in contributions, that won’t happen at this time.

According to Anderson, with the multiple roles of NIB, the current contribution rate isn’t sustainable.

The actuarial report warned that the fund will be depleted by 2028.

It suggests a rate increase of 1.5 to 2% annually, biennially for some time.

However, Prime Minister Davis said putting this burden on the backs of Bahamians will be the last resort.

Fidelity Group of Companies Chief Executive Officer Gowon Bowe says it should not be looked at as a tax.

Bowe also questioned if it is acceptable that the fund could soon run out while many are contributing and will not benefit.

He added that if the contribution increase will be deferred, then there must be a clear plan.