How effectively are public service entities responding to their NIS commitments?

Dear Editor,

Your editorial (SN, August 2) on the vulnerability of the NIS, from a number of perspectives, is most timely and invites serious attention towards stimulating the sustainability of this institution’s vital contribution to the social well-being of so many beneficiaries, including in particular pensioners; and to a significant extent also, working female single parents. It is no secret how exploitable this section of the workforce is, and will continue to be, if relevant procedures in the NIS are not substantively reorganised. The spate of new local and foreign entrepreneurs who have emerged at a time when regulations appear to be not as stringently enforced as should be, are not necessarily considerate of their employees’ welfare.

Your editorial may have stressed the responsibility of the various private sector leaderships to prove their mettle – by educating these ‘nouveau arrivées’ of their corporate social responsibility in this regard. It is critical that employers set high statutory performance standards, if in turn they expect employees to satisfy theirs. One should never overlook the possibility of the negative impact on the employee’s psyche overflowing onto the domestic environment, including family and friends. The cumulative result is resentment towards a class differentiation that can spread throughout not only workplaces, but whole communities.

In a sense, however, the NIS may have been its own worst enemy in its perpetuation of archaic systems of record-keeping which affect related processes, including tardy reimbursements and other payments.

For example, so far as the question of registration of (and by) new employers is concerned, the recommendation has been made more than once to the authorities, to examine for adoption the Barbados NIS model, which facilitates on-line registration by the employee (or prospective employee) in the first instance, as soon as he/she is recruited (or even before). The official proforma is designed to garner all relevant information about both employee and employer, which the NIS can then confirm direct with the latter.

This initiative, statutorily afforded the employee, therefore forces the employer to respond appropriately. Hopefully, in our case, a monitoring mechanism can be installed to discourage attempts to restrain employees from, or penalise them for, pursuing their just deserts. Amongst other things, the NIS will certainly need to upgrade its information technology capacity.

Incidentally, it should be noted that when the NIS was established in 1969, the Scheme anticipated relying on income from a stable public service population at the time, in addition of course from that of large employers like sugar and bauxite. The scenario in public sector employment has, however, changed dramatically in recent years, with increasing resort to ‘contract’ employment, a situation which should not normally anticipate longevity of service.

The above apart, it is worthy of enquiry, given the disparate and unregulated employment regimes now obtaining amongst the various public sector agencies involved, whether or not ‘contracted’ employees are responsible for making their own NIS contributions (as putative self-employed persons). Note that the standard superannuation benefit for these employees is computed at 22.5% of monthly salary, payable at the end of every six month period – that is in lieu of the pension benefits payable to their retired counterparts who are identified as ‘traditional public servants.’

Like the latter, ‘contract’ employees encumber ‘established’ public service posts. Table 1 below focuses on ‘contract’ employees in 23 agencies. It shows a total increase from 1714 in 2009 to 2404 in 2011 (or 40% increase).

Table 1

Summary Comparison of Contracted Employees in Central Public Service Agencies

between 2009 – 2011 – showing Actual Difference in Movement

Source:     Estimates for the Public Sector Current and Capital Revenue and Expenditure – 2010/2011.
Omitted: Office of the Ombudsman

There could be little argument that the self-employed should, in their own interest at least, contribute to the NIS.

As a matter of interest, however, Table 2 following shows the comparable figures for established and contracted employees across the 10 administrative regions, for the years 2010 and 2011.

It is comforting to note that the number of ‘established’ employees has increased by 240 as against 100 ‘contracted’ employees. Nevertheless there is a growing trend.

Table 2

Staffing Details by Regions

(Ranked in terms of Total Staff)

Figures extracted from the 2011 Estimates of the Public Sector – Volume 1.

What may be of interest to the management of the NIS is whether the above figures reconcile with the returns being experienced. In other words are the regions administering this aspect of their mandate efficiently.

Table 3 below is condensed from a larger version which displays regional staffing from the supervisory level up. However, for purposes of this discussion, the focus is on the apparent financial management capacity of the respective administrations.

Table 3

List of Pensionable Posts under Ministries/Departments/Regions

Regions – Administrative Structure (2011)

with particular reference to the Financial Management Component

Figures extracted from Appendix Q on pages 528 – 551 of the 2011 Estimates of the Public Sector – Volume 1.

The disposition of the relevant resources in Regions 8 and 9 makes interesting reading.

It possibly provokes one’s enquiry of how effectively public service entities in general are responding to their NIS commitments.

Yours faithfully,
E B John