Ce­cila Melville

The Na­tion­al In­sur­ance sys­tem was es­tab­lished by The Na­tion­al In­sur­ance Act, No. 35 of 1971, which came in­to ef­fect on April 10, 1972. The na­tion­al in­sur­ance sys­tem (NIS) is a manda­to­ry sys­tem, based on:

• The uni­ver­sal­i­ty prin­ci­ple, which re­quires all per­sons who qual­i­fy as in­sured per­sons to be cov­ered un­der the NI Act with­out ex­cep­tion; and

• The com­pul­sion prin­ci­ple which states that no one who qual­i­fies as an in­sured per­son is al­lowed to opt out of the sys­tem.

There­fore, the Na­tion­al In­sur­ance Act (“the Act”) is a con­tract be­tween the Na­tion­al In­sur­ance Board, the em­ploy­er and the in­sured per­sons. All el­i­gi­ble em­ploy­ees and their em­ploy­ers must con­tribute to the NIS. These con­tri­bu­tions are au­to­mat­i­cal­ly de­duct­ed by the em­ploy­er and in ex­change, the NIB is legal­ly ob­lig­at­ed to pro­vide a range of ben­e­fits (for ex­am­ple, sick­ness, dis­abil­i­ty, ma­ter­ni­ty, sur­vivor’s, fu­ner­al grant, em­ploy­ment in­jury and re­tire­ment ben­e­fits) to in­sured em­ploy­ees. Self-em­ployed per­sons are not for­mal­ly in­clud­ed in the sys­tem at this time. A steady re­tire­ment in­come is an im­por­tant safe­ty-net for re­tired per­sons be­cause with­out this source of in­come many may fall in­to pover­ty. In T&T, a re­tire­ment pen­sion cur­rent­ly be­comes payable by the NIB at the age of 60 years pro­vid­ed that the in­sured has made a min­i­mum of 750 con­tri­bu­tions. The min­i­mum re­tire­ment pen­sion paid by the NIB is $3,000 per month, but per­sons who have more than 750 con­tri­bu­tions qual­i­fy for a high­er pen­sion. There­fore, the prop­er ac­count­ing for con­tri­bu­tions is crit­i­cal since it will de­ter­mine one’s el­i­gi­bil­i­ty for a pen­sion and the amount that is payable. Per­sons who do not meet the thresh­old of 750 con­tri­bu­tions are el­i­gi­ble on­ly for a re­tire­ment grant. As of June 2024, 140,473 per­sons were in re­ceipt of a month­ly re­tire­ment pen­sion while 6,864 per­sons were paid a re­tire­ment grant.

The NIB faces sev­er­al chal­lenges in­clud­ing the is­sue of fi­nan­cial sus­tain­abil­i­ty and the qual­i­ty of ser­vice de­liv­ery. Since 2013 ben­e­fit ex­pen­di­ture has sur­passed con­tri­bu­tion in­come. In 2025, the Gov­ern­ment of T&T in­tro­duced a grad­ual in­crease in the re­tire­ment age from 60 to 65, which will be im­ple­ment­ed over a 10-year pe­ri­od, ris­ing by 1 year for every 2 years un­til it reach­es 65 years in 2036. The con­tri­bu­tion rate was al­so in­creased to 16.2 per cent from 13.2 per cent with ef­fect from Jan­u­ary 2026.

In ad­di­tion, the ex­ec­u­tive di­rec­tor of the NIB, Ms. Nialah Per­sad-Po­li­ah, re­cent­ly ad­mit­ted to a Joint Se­lect Com­mit­tee that the NIB’s records are in dis­ar­ray. She al­so stat­ed that the main rea­son for the re­quest for em­ploy­ees to pro­vide ev­i­dence of their con­tri­bu­tions to NIBTT, be­fore they can re­ceive a re­tire­ment ben­e­fit, is be­cause a vast ma­jor­i­ty of em­ploy­ers have sub­mit­ted in­cor­rect or in­com­plete da­ta on their em­ploy­ees. She point­ed out that forms typ­i­cal­ly con­tained in­cor­rect NIS num­bers, in­cor­rect names, miss­ing dates of birth and oth­er er­rors. She fur­ther stat­ed that these er­rors of­ten led to the records be­ing re­ject­ed by the NIBTT’s sys­tem al­though the em­ploy­er may have paid the manda­to­ry con­tri­bu­tions. Ms. Per­sad-Po­li­ah failed to ac­knowl­edge that the NIBTT is ul­ti­mate­ly re­spon­si­ble for en­sur­ing the com­pli­ance of em­ploy­ers. She al­so did not ad­vise on the ini­tia­tives and en­force­ment ac­tion that are be­ing im­ple­ment­ed to ad­dress the prob­lem.

In­stead, the bur­den of re­spon­si­bil­i­ty for com­pli­ance with the Act has shift­ed from the NIBTT to the in­sured per­son, who has been forced to pro­vide the nec­es­sary ev­i­dence to val­i­date the NIB’s records be­fore they can ac­cess their re­tire­ment ben­e­fit. This is un­ac­cept­able, un­con­scionable and pos­si­bly il­le­gal. The Na­tion­al In­sur­ance (Con­tri­bu­tions) Reg­u­la­tions place a le­gal oblig­a­tion on the em­ploy­er and NOT the in­sured to pro­duce and re­tain records on con­tri­bu­tions paid. Clause 5(1) of the Reg­u­la­tions states that -

“An em­ploy­er shall keep at his place of busi­ness a record show­ing the fol­low­ing par­tic­u­lars in re­spect of each em­ployed per­son and un­paid ap­pren­tice in his em­ploy: (a) his full name; (b) his na­tion­al in­sur­ance num­ber; (c) his salary or wage and the pe­ri­od to which the salary or wage re­lates; (d) the con­tri­bu­tion paid for each week of the pe­ri­od to which his salary or wage re­lates; and (e) the to­tal con­tri­bu­tions paid to which his salary or wages re­lates, and such record shall be avail­able for in­spec­tion dur­ing nor­mal work­ing hours.”

The em­ploy­er is al­so re­quired to re­tain the record of NIS pay­ments for sev­en (7) years or un­til au­dit­ed by the NIBTT, whichev­er is lat­er. Fur­ther, the em­ploy­er and the NIBTT are ob­lig­at­ed to at­test to the com­plete­ness and ac­cu­ra­cy of records and NOT the em­ploy­ee.

Re­liance on the em­ploy­ee’s records can on­ly be a sec­ond-best so­lu­tion be­cause it is rid­dled with chal­lenges. First­ly, the NIS con­tri­bu­tions are de­duct­ed by the em­ploy­er and in­for­ma­tion is filed with the NIB, which is the sole repos­i­to­ry of the records and is re­spon­si­ble for pro­vid­ing safe cus­tody. The em­ploy­ee plays no role in the process and can­not au­then­ti­cate whether de­duc­tions were re­mit­ted.

The em­ploy­ee al­so does not have the pow­er to com­pel the em­ploy­er to pro­vide the re­quest­ed in­for­ma­tion. More­over, the em­ploy­ment his­to­ry of the in­sured may span in ex­cess of 20 years mak­ing it dif­fi­cult to lo­cate em­ploy­ers es­pe­cial­ly in the pri­vate sec­tor. In ad­di­tion, the em­ploy­er may no longer be in busi­ness which leaves the em­ploy­ee with no ac­cess to records.

Fur­ther, pay slips and/or TD4 forms may have been mis­placed or lost. While the law re­quires an em­ploy­er to per­mit an in­sured per­son to in­spect the records of con­tri­bu­tions, such re­quests may not be fa­cil­i­tat­ed. Fi­nal­ly at­tempts to ob­tain copies of the TD4 forms or a record of pay­ments from the Board of In­land Rev­enue (BIR) do not al­ways yield pos­i­tive re­sults. In sum­ma­ry, the ef­fort to ac­quire proof of con­tri­bu­tions is of­ten oner­ous, frus­trat­ing and fu­tile since the in­sured per­son may not have the where­with­al to nav­i­gate the sys­tem to find the re­quired ev­i­dence.

Af­ter mak­ing manda­to­ry con­tri­bu­tions, per­sons should not be de­nied their NIS pen­sion or any ben­e­fit be­cause of in­com­plete or poor record keep­ing by the NIB or the em­ploy­er! Clause 50 of the Act states that the in­sured should not be de­nied any ben­e­fit due to a fail­ure of the em­ploy­er to pay con­tri­bu­tions. In ad­di­tion, the Act vests the NIB with the pow­er to ad­min­is­ter and en­force com­pli­ance through con­duct­ing au­dits on em­ploy­ers and by im­pos­ing fines, penal­ties or oth­er sanc­tions in­clud­ing im­pris­on­ment for of­fences. Fines and penal­ties should be in­creased so that they are a strong de­ter­rent to non-com­pli­ance by em­ploy­ers.

The NIB should pur­sue ur­gent ac­tion to im­prove its op­er­a­tions and ser­vice de­liv­ery in­clud­ing em­bark­ing on a dri­ve to clean up its records and im­ple­ment­ing mea­sures to digi­tise the pa­per-based sys­tem. To this end, the NIB would need to de­ploy the rel­e­vant re­sources to mod­ernise its op­er­a­tions.

In ad­di­tion, the NIB should pro­vide in­sured per­sons with the op­por­tu­ni­ty to re­view their state­ment of con­tri­bu­tions on a reg­u­lar ba­sis and to ad­vise of er­rors and/or cor­rec­tions in their records on a re­al time ba­sis in­stead of the cur­rent prac­tice of ac­cept­ing cor­rec­tions when an ap­pli­ca­tion for the re­tire­ment ben­e­fit and oth­er ben­e­fits, is be­ing sub­mit­ted.

Fi­nal­ly, the im­ple­men­ta­tion of pub­lic ed­u­ca­tion pro­grammes to in­form em­ploy­ers about their oblig­a­tions and in­sured per­sons about their rights in­clud­ing the right to ap­peal any de­ci­sion of the board of NIB will build pub­lic con­fi­dence and trust in the sys­tem.

Ce­cila Melville worked for 10 years at the Cari­com Sc­re­tari­at in for­mu­lat­ing eco­nom­ic and fi­nan­cial poli­cies as well as the Cen­tral Bank, the TTSEC and Citibank.