MPs Meet on Friday to Provide ‘Economic Relief’ Under National Pension Scheme

Bermuda’s parliamentarians will meet this Friday “to pass legislation that will provide further economic relief to Bermudians” under “proposed amendments to the national pension scheme” approved by the Cabinet on Tuesday.

Speaking at the latest COVID-19 briefing on Wednesday, Premier David Burt said: “We will expand the scope of existing provisions for financial hardship to include a one-time withdrawal of up to $12,000, from person’s individual pension accounts.”

He also acknowledged the anticipated resistance to the proposed plan.

“There are those who will raise legitimate questions and legitimate concerns about the impact this could have on the long-term health of person’s individual pensions.

:We share those concerns.,” said Premier Burt.

“But it is clear that this is not any normal time.

“Funds like this should only be accessed in emergency situations.

“And it is undoubted that the massive amount of unemployment that is seen in our economy due to the restrictions that are necessary to put in place to preserve life is such an emergency.

“The reality is that there are people suffering today, who need assistance today and the overall health of our economy requires help today.

“This money is Bermudians’ savings, largely overseas and bringing some of that money home is the right move at this time.

“This will have no impact on anyone currently receiving pensions and no impact on those persons set to be eligible to receive pensions over the next couple of years,” he added.

“It is important to note that withdrawals can only be made from individual defined contribution plans, what we call private pensions. Withdrawals cannot be made from Government’s Social Insurance Fund, or it cannot be made by public officers or those persons who work in quangos, such as the Hospital and other places from the Public Service Superannuation Fund, or public officer pensions.

“These are defined benefit plans and other defined benefit plans are not eligible for this one time withdrawal. So, to put it simply, you will not be allowed to dip into anyone else’s savings.

“These funds will come from individual savings that persons have saved up over the years. It is your money and at a time like this, your money can be used to help our economy.

“Applications for participation in this relief initiative will be administered by the current pension plan administrators.”

Overall, he said: “The devastating impacts of COVID-19 has created massive economic disruption and displacement to workers around the world.

“Here in Bermuda, we began to address this impact to our economy through the introduction of the new unemployment benefit, which is seen $15 million paid out to date, and provides a safety net for our workers through this programme.

“Additionally, to support small and medium sized businesses, the Minister of Finance has given a grant of $12 million to the Bermuda Economic Development Corporation to assist those businesses during this time.”

Premier Burt also noted that the Government “consulted with the Opposition, who have agreed to allow a process which normally takes weeks to be conducted in one day in the House of Assembly on Friday.”

“I am grateful to the Opposition for their support and cooperation in moving this forward. I am also grateful to the Speaker of the House for allowing us to be able to move this in virtual session on Friday,” he said.