More from Your Paycheck for Social Security

Will there be an increase in the amount of money that comes out of your paychecks for social security? That is yet to be seen, but on Tuesday, S.S.B. C.E.O. Doctor Colin Young confirmed that by next year, there will be an increase in the value of contributions per employee to the S.S.B.  Early this year, Social Security Board began holding public consultations on the benefit structure to address a mandatory increase in the wage band, but according to Doctor Young, the board is assessing whether the scheme should be changed to a percentage on insurable earnings.  As it stands, employers and employees collectively share an eight percent contribution rate to S.S.B. and that is the lowest rate in CARICOM.  Doctor Young says that the increase is to meet the demands of the volume of pensioners, among other reasons.

Colin Young

Dr. Colin Young, C.E.O., S.S.B.

“We are at a point now at the scheme where the increase has to be done because of the sustainability of the fund. The question is always going to be who is going to burden most of the increase. Is it going to be fifty-fifty with employers and employees? Is it going to be a different allocation? That’s the discussion that has to be had. Very important discussion, but ultimately we will need to see the wage band increase no later than next year.”

Duane Moody

“What’s trigger the need for the increase?”

Dr. Colin Young

“A couple of things are the need. First is that the last increase in contributions to Social Security was in 2003 and of course as you know there are a number of people who are becoming pensionable now. And when your revenue into the scheme stays the same but your costs increase every year, obviously you are going to get to a point where your revenues are insufficient to cover your expenses. For example our actuary is saying that the number of pensioners increase by about eight to ten percent per year into the scheme. Because of the fact that our revenue has not increased in terms of contributions since 2003, the increased cost to administer the fund, the increased number of sickness benefits claims, employment injury claims and other benefits that we offer, it is now creating a situation where we are running a deficit as it relates to contributions versus expenditure.”