The National Insurance Board will be increasing contributions and benefits to the National Insurance Scheme by about 20 per cent effective March 3.
The NIB has released several advertisements over the past week to inform employers and employees to be mindful to the changes.
“The NIB reminds the public that the increases in the value of incomes protected by the NIS ensures that benefits remain in sync with earnings,” the advertisement said.
This is the second such increase of a two-year phased implementation process; last year payments rates were increased by about 25 per cent; this year they will increase by about 20 per cent.
Last year, NIB executive director Karen Gopaul had said in order to make benefits relevant to the rate of inflation, the Board had indicated that it may need to increase payments by 52 per cent.
Contributions to the scheme increase 0.3 per cent to 11.7 per cent last year, and will increase a further 0.3 per cent to 12 per cent of earnings this year. Benefit payments will increase by about 50 per cent over two years (as per inflation estimates between 2006 and 2010).
Previously the maximum contribution to the NIB came from those who had salaries of about $8,000 and over; last year this increased to $10,000; and this year it will be $12,000 and over.
By increasing the number of people who are covered up to $12,000, the NIB will receive more contribution income, and this will help find benefit payouts.
On the lowest end of the salary spectrum (average weekly wages of $240), an employee’s contribution will be $9.60 per week, and the employer’s $19.20; at the highest end (average wages $2,770), employees will contribute $110.80, and employers $221.60.
In a brief telephone interview yesterday, Gopaul said everything was in place at the NIB to ensure a smooth transition through the change, but reminded employers to pay attention to the notices by the Board of the changes in contribution rates, because errors on their part can affect the contribution records of their employees.
Employers have, she said, nevertheless given the NIB support for the increased payments.
“One thing about employers in general is once employees are getting a benefits, they are usually supportive of the initiative,” Gopaul said.
The NIB also signed a memorandum of understanding with the Ministry of Legal Affairs on Wednesday to allow the NIB access to the Registrar General’s department and information on births and deaths.
This will allow the NIBTT to issue automatic payments to beneficiaries of long-term NIS benefits (pensioners)unless it receives a death notification; this means senior citizens will no longer be required to produce a life certificate every six months.
For further information on the changes, visit the NIB’s website at www.nibtt.net.