|Civil servants at odds with government||| Print ||
|Thursday, 10 March 2011 12:56|
Some civil servants, active and retired, are about to see their benefits “rightsized” when tighter regulations on pensions and salaries go into affect April 1.
During recent scrutiny of government payroll, overpayments of pensions, gratuities and salaries were discovered to the tune of more than $10 million in recent years.
Due to oversights and lax controls, some civil servants have been receiving double pensions costing the Turks and Caicos Islands government more than excess of $600,000 per year. Instances have also been uncovered where officers retired from public service and were then re-employed, drawing both a pension and a salary.
An oversight in gratuity payments for civil servants who were employed before the National Insurance Board (NIB) ordinance resulted in an overpayments totalling in excess of $6 million, according to the government.
Payouts for accumulated leave beyond the 30-day per year cap have resulted in overpayments of $3.6 million from 2006 to 2010, with cases of individuals receiving $200,000 upon retirement for accumulated leave.
Acting Governor Mark Capes and Chief Financial Officer Caroline Gardner met with representatives of the Civil Service Association’s Management Council to discuss the issues last week. Capes presented the CSA representatives with a document defining the oversights and changes to pension and payroll they intend to implement effective April 1st.
The CSA’s Management Council says it welcomed the proposed increase in the age of retirement from 55 years to 60 years, eliminating a five-year gap during which civil servants who retire at 55 years of age would not be receiving any pension.
It also agreed to some of the changes which seek to regularize departure from policies, such as issuances of allowances.
CSA representatives are concerned about policies they believe are detrimental to the welfare of past and present civil servants, which they say “combined with the proposed new taxation measures will create hardship for us and our families.”
The CSA is not in agreement with the following measures:
Including all allowances in the calculation of contribution to National Health Insurance Plan and NIB
Currently allowances have been left outside the salary, which is not in line with NHIP and NIB rules.
Applying a 10-percent cut to allowances
A 10-percent pay cut was applied to all civil service salaries last April and was intended to also apply to allowances, with the exception of the housing allowance. This was never applied and is now being implemented one year later. The cut amounts to $408,000 per year.
Removing allowances from the amount of salary on which pension is calculated
Currently pension is calculated including items such as a housing allowance or personal expenditures reimbursed to the employee.
Reducing the number of years for payment of housing allowance from five years to three years
Currently officers transferred to other islands are entitled to receive a housing allowance for up to five years. All officers (except police and contract officers) currently receiving the allowance will have to justify their allowances, and all unjustifiable allowances will be stopped within two months.
Discontinue the practice of payment of 25-percent of pensionable salary as a lump sum gratuity
According to the Pensions Ordinance, civil servants employed prior to April 6, 1992, may opt to convert 25-percent of the pensionable salary into a gratuity equal to 12½ times its value.
The CSA is also concerned about the time frame for proposed changes.
The group’s president and vice president met with the Consultative Forum in a closed door session on Tuesday, March 8, to discuss the issues further. They said the forum offered them “overwhelming support.”
On Friday, March 11, the CSA is expected to submit to the interim administration a counter proposal, listing demands and making recommendations for new and revised revenue measures in an effort to prevent the implementation of the proposed changes to pension and payroll.
The CSA intends to give the administration seven days to respond. “Failure to respond in a favorable manner in the spirit of negotiation will lead to the taking of any and all actions necessary to obtain fair and just treatment,” the group said in a statement.
Failure to come up with amicable solutions will result in “legal and other actions in defense of the welfare of past and present civil servants and their families,” the CSA said.
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