Self employed Barbadians who refuse to contribute to the National Insurance Scheme (NIS), should be prevented from plying their trade until they comply.
This is the view of former NIS officer Stephen Strickland, who on Wednesday evening, proposed a system that would require various classes of self-employed people to register their businesses and simultaneously contribute to the struggling fund.
“We have 12 months in the year. We only have to divide the 12 months into different categories in the same way that I renew my driver’s licence in February because I am a February born. It would mean that we can have carpenters and whoever else in January, another category in February and go right down the road,” said Strickland.
He was one of many who showed up at the Alexandra School for the second of three town hall meetings, following an actuarial report suggesting that NIS funds could be depleted in as little as 12 years.
Strickland said that contributions to the NIS for self-employed Barbadians, who range from doctors and lawyers to public service vehicle operators and tradesmen, should be enforced through a process similar to that of land tax collection.
He estimated that the country’s economic situation had pushed many into self-employment, especially during the COVID-19 pandemic period.
“Registration online is easy and they would be forced to pay contributions to engage in the area of self employment that they are in. Therefore the national insurance wouldn’t have to run behind anybody. When they reach the pensionable age, they wouldn’t have to come and tell lies that they were not self employed. It is not as difficult as we think it is,” he suggested.
Strickland said this strategy should be coupled with an aggressive in-person public campaign that educates Barbadians about the importance of the scheme.
He however acknowledged that tremendous work would be required to restore trust in the independence of the NIS board. In addition to heavy investing in government paper, he noted that increasing pension for non-contributory retirees may have been ill-advised.
“The confidence in the board must be restored because the board is responsible for my money and your money and therefore when individuals seek to put their hand in there, tell them no,” he said.
“This is not their money. The government’s money is managed by Parliament in the Consolidated Fund. You can manage that, but the board manages the one at the NIS and I am passionate about this because every day and night I interface with people who are asking questions and they need honest answers,” he added .
Karen Jordan stepped up to the mic to simply inform the panel that included NIS Chairman Leslie Haynes, his Deputy Rawdon Adams, NIS Director Kim Tudor and actuary Derek Osborne, that an increase in monthly contributions was not an option.
“Nobody is looking at how [increasing the contribution rate] impacts the average person,” said Jordan.
“Nobody is talking about people on the threshold and how hard it will be for them to pay an increased contribution rate. You are just telling me that we have to pay the rate because we want the fund to survive?
“I want it to survive too, but you can’t have it surviving at the expense of people living today. If you keep talking about increasing the rate and the longevity of the fund, people are suffering today and nobody is talking about that,” she added.
Rohann Beckles, meanwhile, suggested a system through which people could partially opt out of the system and contribute smaller amounts to help keep the fund afloat while pursuing their own investments.
“If there are a large number of persons who can handle their own affairs, those might be the persons who don’t necessarily need to depend on a full NIS,” said Beckles.
“If there is some flat amount that you could give to people, they could contribute to that and it would be far less. Those persons can be given an option: ‘do you want to be in the NIS plan to get a pension or do you just want a reduced amount where you understand that it’s like a tax and you are contributing to your fellowman?’ You understand that there are persons out there who are below the poverty line and th
is is your responsibility as a citizen,” he added. (TD)
