December 7, 2021

Cayman Islands Minister’s Statement on “Penny Pinching Pensions”

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Screen Shot 2016-06-28 at 10.24.30 AMStatement to the Legislative Assembly 7th Meeting of the 2015/2016 Session of the Cayman Islands Legislative Assembly

By the Honourable Tara Rivers, JP, MLA

Minister of Education, Employment and Gender Affairs

Compliance of Recommendations Made by the Office of the
Complaints Commissioner’s Report “Penny Pinching Pensions”

24 June 2016

Mister Speaker,

I rise today to make a brief Statement in relation to the Ministry and
Department of Labour and Pensions fulfilling the recommendations made in
2010 by the Office of the Complaints Commissioner (OCC) in an Own Motion
Investigation Report entitled Penny Pinching Pensions.

This report -which contained a total of 21 recommendations- was initiated by the Complaints Commissioner at the time, Ms. Nicola Williams, and it was her first Own Motion Investigation report and was deemed to be the most lengthy and detailed Report in the history of the Office of the Complaints Commissioner at that time.

In this report, Complaints Commissioner Williams stated that “this Own Motion Investigation was undertaken because it was one of the most pressing and obvious examples of systemic failure of a government entity- the National Pensions Office, and the National Pensions Law that underpins it.” The three main concerns that lead the Commissioner to start this investigation were 1) non-compliant companies continuing to ignore the Pensions Law; 2) whether the National Pensions Office had any real power to enforce the law; and 3) the National Pensions Law not having been substantially revised since 2000.

The 21 Recommendations made by Commissioner Williams could be grouped into the following categories: legislative changes; public education and outreach; structural changes in regards to the National Pensions Office (now known as the Department of Labour and Pensions) and the National Pensions Board; inter-agency working relationships within Government; and training.
While I do not think it is necessary to go into detail in regard to each of the 21 recommendations, I do think however that it is relevant to state that within this report the Commissioner highlighted in her findings that “the existing legislation applicable to pensions needs substantial revision, both to impose harsher penalties for non-compliance, and to close loopholes that dishonest employers take full advantage of.” I therefore would like to assure the Members of this Honourable House that the National Pensions (Amendment) Bill, 2016 that was unanimously passed on May 4, 2016 addressed all of the legislative recommendations contained within the Complaints Commissioner’s report.

The National Pensions (Amendment) Bill, 2016 reflects the recommendations contained within the Penny Pinching Pensions Report in the following ways:

o It significantly increases fines (in some cases escalating up to $100,000) and introduces imprisonment terms for offences in order to act as a true deterrent;

o It introduces an administrative fine regime as another enforcement tool to deal with employer non-compliance;

o It increase the power of the Director, Deputy Director and designated person to have the same powers, privileges and immunities as conferred on a constable by the Police Law when performing their duties in relation to administering administrative penalties;

o It introduces a victimization protection clause for employees who make a disclosure to the Department of Labour and Pensions in regard to an employer’s non-compliance of the Law;

o It introduces more requirements for pension plans to educate and inform members including the requirement for annual general meetings and an increase in the availability of pension statements as well as notification from the administrator if their employer becomes delinquent;

o It also improves the disclosure of information to members by introducing the requirement for pension plan administrators to provide members with details on the investment returns and expense rations of their pension fund; increase the frequency of member statements from annually to semi-annually and allows statements to be issued electronically with a member’s consent; and increases the access to the administrator’s records on the pension plan from once a year to every six months and establishes that the access is permitted to those persons stated in the Law.

o It clarifies the roles between the Department of Labour and Pensions and the National Pensions Board by removing the duty of the National Pensions Board to administer the Law and its regulations and highlights its duty to carry out its functions as an appellate body as established already under the Law.
Mister Speaker, on the 21st April 2016 the Ministry submitted its latest report to the Office of the Complaints Commission to update the Office on the progress made on the outstanding recommendations. I am pleased to report that on the 5th May 2016, the Ministry received a letter from the Acting Complaints Commission, Mrs. Bridgette von Gerhardt, which stated that the Office of Complaints Commissioner determined that the Ministry has complied or substantially complied with the recommendations numbered 1-19 and 21, and the OCC withdrew recommendation number 20 based on a review of the Ministry’s current processes and policies which do ensure that private sector companies awarded tenders within the Ministry are compliant with their pension contributions as well as statutory health insurance requirements.

Given that the Office of the Complaints Commissioner has now closed the matters outlined in the Penny Pinching Pensions Report, I would like to provide for the record to this Honourable House the letter to the Ministry from the OCC stating this.

The Ministry and the Department of Labour and Pensions met with and reported to the Office of the Complaints Commission over the years to demonstrate that it had complied with 10 recommendations of the report, however it was agreed by all parties that the vast majority of the outstanding recommendations were tied to revising the pensions legislation. I am therefore proud Mister Speaker that with the passage of the National Pensions (Amendment) Bill, 2016 the Office of the Complaints Commissioner has deemed that the Ministry and Department have now successfully complied with the OCC and this report is now officially closed by their Office.

Thank you, Mister Speaker.

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