The Cabinet of Antigua and Barbuda says it has learned that private enterprises—employers of two-thirds of the nation’s workforce—owe Social Security more than EC$27,000,000 (twenty-seven million) dollars.
It said today that $10 million dollars of the $27 million have been declared bad debt, which cannot be recovered.
Based on government information, statutory corporations also owe the Social Security unpaid contributions of $54 million dollars.
“The Cabinet insisted that the management of Social Security must devise methodologies to collect unpaid contributions, including
“Contractors and sub-contractors are among a group that avoids paying legitimate social security contributions,” it added.
The Chairman of the Social Security Board, its Director and the Accountant, were invited to Cabinet to address the projected shortfall in revenue which will affect recipients in the current month and in January 2019.
The Board made a request for $15 million dollars to meet the amounts required in December 2018 and January 2019.
The Cabinet has asked the team from the Social Security to return next week when the decision to secure the $15 million dollars will likely be ratified.
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Antigua’s social security system is broken. We need to transition to a Singapore style retirement system with individual private accounts and strong oversight. It’s just a matter of time before Antigua’s current system completely fails.
Rather interesting! The private sector employs 66.6% of the workforce, and have $27 million in contribution arrears. Statutory Corporations employ less than 3% of the workforce, but have $54 million in outstanding contributions. Imagine that! Private sector employ more than 22 times the number employed by statutory corporations, but the corporations owe more than twice the amount due from the private sector. Interesting numbers that we need to digest.
What has not been disclosed is how much is due from central Government. School children say that, just for 2018 alone, they owe more than $9 million in unpaid contributions. Add to that rent for the buildings occupied by Government and interest on loans due from Government, and you get the picture. While the private sector needs to clean up their house, the major offenders are the Government and its corporations, and they need to lead by example.
You are totally right. Well, I continue to advocate the idea of totally reinventing Antigua’s social security system. We should follow Singapore’s CPF system which is top ranked in the world for retirement security. Why several Antigua governments (both parties) continue with this broken social security system is beyond me…
As a contributor to the Social Security Scheme for many many years, and as one who is soon approaching retirement age, I am sick to the bone with such news coming from the Social Security Scheme. Worst of all, I am saddened that while the Government is prepared to immediately pump 15 million dollar into the scheme in order to meet its obligations for December and January, this quick fix cannot go on indefinitely and by the month of February, the exact same problems will surface again. It is depressing that the Government and its statutory bodies are the biggest culprits in the Social Security being in this position. Social Security has inspectors who constantly audits the books of Private employers and if these auditors only single out private employers and harass and punish them for nonpayment and ignore the statutory bodies and other government agencies, then something is fundamentally wrong with our processes and successive boards over the years were simply just a government puppet and rubber stamp and have neglected their duty to the people of Antigua and Barbuda. Everyone must pay their share to the Social Security Scheme and employees cannot expect to benefit if their Employer is not contributing. I am also making an important call on all Government Boards to be vigilant and end the nonsense of collecting fees for sitting on boards and not being diligent in ensuring that the peoples business is effectively done. All the members of the various boards have let us down, and its time that this nonsense be stopped. I am upset, because for all my working life, I have contributed significantly to the Social Security and now it’s almost retirement time, I see monthly struggle to get benefits. And I want to caution everyone…..government will soon be forced to increase both employee and employers contribution in order to help to remedy this situation. Take it from me…it’s coming soon.
The structure of the social security system is broken. The only way to fix the problem is to create a brand new system, or else we are going to go bankrupt. Antigua has the same problems that the USA has with its lousy social security system, the difference is that we cannot raise debt left and right like they do to pay the obligations.
The best retirement system in the world is Singapore’s Central Provident Fund (CPF). Basically all your contributions to your retirement go into your own private account overseen by the Singapore government – they can never take away your money that is in your individual account. This protects against situations like what Antigua is experiencing now.
Google the Singapore CPF system and you will see how modern, well organized, and how much safer it is than Antigua’s system.
Contributions for Social Security have been going up already and will be going up again from Jan 2019 . Medical Benefit Scheme contributions will soon be going up again also be assured . The same people paying now are expected to pay more yet so many including Government and Goverment Corporations are not paying .
The IMF will be back in Antigua in two years or less.
I do not believe the system is broken but it needs reform and implementation of the existing rules. It would be interested to see which sector of the private entities are the biggest defaulters. My best guess would be Hotels. Social Security have collections policy and personnel to carry out this function. The problem is that past offenders go to the minister and Social Security then back off.
Do you want to fix it?
First remove this rubbish of every time the government change a new board is implemented.
Secondly Remove the appointment of the entire board from the hands of politicians and put it in the hands of contributors and employment unions.
Thirdly only appoint board members with something to contribute to the organisation. (Square pegs round holes)
Finally have annual publicly available annual reports with actuary’s report on the existing position and future forecast of the society
First of all I realize once again that the Director has been skillful again to bamboozle the entire cabinet and the thereby the people of Antigua and Barbuda. This issue is an old issue that he keeps bringing up every time they hold his feet to the fire. It is the same song he gives the government. Whether it was under the UPP or the ABLP. That is why he has no sleeplessness nights because he is on record of saying that the obligation is that of the government to make up any shortfall that the funds may have. Why is no one looking into how our monies are spend on a monthly basis. Why is it that budget line items are not cut. Salaries are not cut or frozen. Directors perks are not cut. Traveling is not cut. Training is not cut. IT gadgets are not cut, per diem is not cut. The staff have never received their salary late but the pensioners are not paid. Why is it on the eve of the 2014 election the Director said that all we needed to do was to increase the unemployment and to increase the rate and the pension age. And after all that we still have the same problem and even worst. I am disappointed in the Cabinet. That they swallow everything hook line and sinker. When I review a companies performance I ask for a cash flow so I can see where the money is bleeding. How much comes in from where and where it goes. I do not need to hear who owes you and how much. because that is old news. Good for the balance sheet. The already went through the exercise of taking contractors to court. Guess what happened. The in-house legal officer made a mint in commission. So with this so called new mandate, how long does it takes to take someone to court and if the person doesn’t have the money than what. Take for example the Observer which we now know that they owe Social Security a couple of hundred thousand dollars. What has Social Security done to recover this debt? And over what period was Observer allowed to accrue this debt. I hold the Director responsible for having allowed employees rake up these debt. That shows a failure in the execution of his duties. I can understand that of the Statutory companies. But private companies such as Observer and whomever should have been addressed since they were three months delinquent. And here they are already talking about writing off ten million dollar. So the Statutory companies will be taken to court as well? Or is it only the private companies. Cause the head of a Statutory Company is the minister under which that company falls. Perhaps we need to do away with Statutory Companies and make them all State Owned Enterprises. And give the Board Members more authority. Like the WIOC board or the CUB board or SIC board. And by the way I understand the delegation that went to Cabinet did not include the Financial Controller. I wonder why? isn’t that the person that the Cabinet would have like to hear from? I am disappointed in my PM and his gang. Piss poor performance. bamboozled by a con artist. With old debt figures that are not collectible whatsoever. I remember when Christian was trying to solve this issue and he signed a MOU with himself so to speak. The debt was converted into a bond. Payable whenever at a very low interest rate. That only help the government current debt ratio looked good for the IMF. Gaston thought to be much cleverer. He did an Asset Swap and gave them a Army Base on their Balance Sheet. No cash income to be gained from that. But that did something for the Debt to GDP in the meantime the Base is being utilize by the army anyway. Should the army therefore not pay lease to Social Security as income derived from its assets. But who cares. The rest of the Assets not earning any income either. So why not start to liquidate all these non-performing assets. I’m sure people want to purchase lands and some prime plots in town. What good is it on the Social Security Balance Sheet. I know. At the right time someone will buy it for a very good price.
Come one people lets get serious with this thing. It is a bottomless pit. We need to rebel by starting to put our contribution in an Escrow Account and start a civil disobedient exercise. Cause no body really seem to care.
Reorganize the Fund in such a way that the overhead and other Operating expenses are not paid out of the monies collected. Let them fall under the national budget. Perhaps then we will get grip of what the problem is. You do away with the board and NAMCO will manage the surplus funds. I feel real bad for those pensioners that depend on the little checks to make it through the month while Board, Management and Staff are being paid on time and paid BIG FAT SALARIES without delay. Shame on you guys and girls. shame on you.
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