Grenadians now have to pay a 12 percent contribution towards the National Insurance Scheme (NIS).
NIS director, Dorsett Cromwell, last week wrote to employers outlining the reasons and justification for the one percent increase that was originally announced by Prime Minister and Finance Minister Dickon Mitchell when he presented the 2023 budget statement in December.
“The 12 Actuarial Review made the recommendation that the National Insurance Board institute a permanent funded unemployment benefit with a contribution rate increase of one percent in 2023 to be shared equally by the employer and the employee,” said the letter, noting that the recommendation was accepted by the National Insurance Board and approved by Cabinet on January 16.
Section 22 of the National Insurance law mandates the conduct of actuarial reviews on the National Insurance Fund every three years.
“In light of the above, the Board anticipates that this recommendation will come into effect in the month of February 2023 and therefore the contribution rate will increase rate will increase by one per cent from 11 to 12 percent shared equally between employers and employees,” according to the letter.
It said that employee’s rate will now be 5.5 percent while employer’s rate will be 6.5 percent.
The new rates go into effect from February 1, according to an extraordinary publication of the official Gazette signed by the minister responsible for Social Security, Phillip Telesford.
Last December, the prime minister said a permanent unemployment benefit will be established with the NIS, saying “this program will provide cash transfer to workers who are rendered unemployed in the event of a natural disaster, pandemic, or other such shocks”.
He said the current NIS is an important pillar in the social protection architecture and his administration will make some tough decisions that will ensure citizens are guaranteed a pension when they are no longer able to work.
He said the government will also amend the NIS Act and strengthen the existing system to include protection for children of deceased insured who are disadvantaged due to the negligence of a parent, and the inclusion of survivors’ and maternity benefits for persons who are in common-law relationships.
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