It seems the increase of the local pension age from 60 to 62 is finally ready for approval by Parliament (see related story). The measure had been on the books since 2012, but there were several aspects to be taken into account.
St. Maarten obviously is following the international trend, because worldwide pension funds have come under pressure due to the fact that medical advances make it possible for people to live longer, but also keep their jobs if allowed. The result is an ageing population in which there are relatively more recipients and fewer active employees contributing. In various countries the limit was raised to 65 and in others even to 67.
Nevertheless, there were many things to consider. For starters, St. Maarten has the old age pension AOV that everyone receives based on the number of years they lived and worked on the island, but also the general pension fund APS for public sector personnel.
For example, in Curaçao they made the mistake of changing only the former from 60 to 65, but not the latter. This meant that civil servants and teachers still retire at 60 and receive their government pensions as such, but not the AOV until five years later, causing them to lose a considerable amount of income.
The same issue was foreseen locally, although the “gap” here is only two years. The envisioned solution is to allow especially those public sector employees nearing the pension age to continue working until their AOV kicks in when they reach the age of 62.
Up to recently the unions involved such as WICSU and WITU still had questions about this transition arrangement as to the precise criteria, etc. Also, among labourers who are close to reaching 60 there continues to be concern that they won’t be able to stop working and enjoy their AOV as perhaps planned.
However, the bottom line remains that this step is necessary ensure the long-term viability of both funds and thereby the pension allowances of future generations. That is a responsibility the entire community will have to carry.
