THE HAGUE--One of the proposed measures of the reform packages for Aruba, Curaçao and St. Maarten is to increase the pensionable age from 65 to 67 in the next five years.
The increase of the pensionable age is just one of the many measures that have been put on paper by the Dutch government as part of the country packages for the Dutch Caribbean countries to accomplish structural reform. The Dutch government has made structural reform a condition in the consultation for liquidity support.
The to-be-established Caribbean Reform Entity would support the execution of the reform measures that are stated in the country packages. From documents that were released after the meeting of the Kingdom Council of Ministers on Friday, it became clear that the Netherlands wants the islands to further raise the pensionable age.
In Curaçao and Aruba, the pensionable age for both civil servants and the old age pension AOV has already been increased to 65. In St. Maarten the pensionable age for civil servants and the AOV is still 62. As part of the conditions for the second tranche of liquidity support, St. Maarten had to raise the pension age to 65 per July 1, 2020. The Kingdom Council of Ministers has given St. Maarten until July 15 to comply with the conditions of the second tranche.
The national ordinance to raise the pension age for civil servants to 65 has been approved by the St. Maarten Parliament, but still needs to be proclaimed and implemented. The national ordinance to raise the AOV pension and pension age to 65 is currently being handled in the St. Maarten Parliament. (See related story)
On Friday, after the Kingdom Council of Ministers meeting, the media asked the prime ministers of the three countries their opinions about the proposed measure to further raise the pensionable age to 66 in 2023 and to 67 in 2025.
St. Maarten Prime Minister Silveria Jacobs explained that increasing the pension age was not a simple step that could be taken hastily. “Just as in the Netherlands, it takes a lot of discussion with all stakeholders. It requires you to meet with the labour union, with employers. It took the Netherlands 10 years, so why expect us to achieve this in matter of weeks?”
Aruba Prime Minister Evelyn Wever-Croes said that to her knowledge the increase of the pension age to 67 was “one of the points of departure” in the document to implement structural reforms in the countries, and not a “requirement” as such.
Wever-Croes said that reforming the pension system was already being discussed with the social partners in Aruba. She said that the lower life expectancy on the islands was a factor that needed to be taken into account. “The life expectancy in the Netherlands is higher than in the Caribbean. We will need to further discuss this.”
In an interview with the media, Jacobs also addressed a couple of other issues, including the financial situation, acquiring loans, the proposed Caribbean Reform Entity, the St. Maarten Development Vision and the complex, bureaucratic reconstruction process involving the World Bank.
Jacobs said that government was being “very frugal” to cut cost, while looking at ways to diversify the economy and securing tourism markets outside the United States. As for the securing of loans outside the Netherlands, she said this was a discussion that would be taking place with The Hague in the next couple of weeks.
St. Maarten and Curaçao under the financial supervision regulation are restricted in seeking loans outside the Kingdom, and that is why the countries have turned to the Netherlands for liquidity support. Jacobs wants a solution for this matter. “If you refuse to lend us the funds under acceptable conditions, then our next request would be to release us from that commitment to borrow through you.” Seeking international funding would then become an option.
The Caribbean Reform Entity will only add another layer that will further hamper St. Maarten’s development, with the World Bank complex procedures already being in place as part of the island’s reconstruction process after the 2017 Hurricane Irma.
“I don’t think that the Kingdom Council of Ministers and the Second Chamber [of the Dutch Parliament – Ed.] truly comprehend this,” said Jacobs, who noted that it was the intention of the St. Maarten government and Parliament, together with the Caribbean Community CARICOM countries to inform the rest of the world, the United Nations, that as a former colony, St. Maarten never went through the full process of proper decolonisation.
“We are now being pressured to move backwards to a system that resembles colonisation again and to us that is not acceptable,” she said.
Jacobs will remain in the Netherlands until Tuesday and has a number of meetings that she will attend.