Parliament rejects amendments to the Pension Act

Parliament has rejected the amendments to the Pension Act which proposed to facilitate the withdrawal of funds for employees from their pension accounts in certain stipulated circumstances.

The amendments received 28 votes against and 17 votes in favour of being incorporated into the act. Two MPs abstained from the vote.

Amendments that were proposed by Guraidhoo MP Ibrahim Riza to Article 14 of the Pension Act included clauses along lines that all employees must be able to withdraw their pension savings for certain purposes including; for a person to make the Hajj pilgrimage, to seek medical treatment from a foreign country, to undertake higher education, to build property, and to start a personal business. It also states that a person who had worked for a contracted duration or a person who had been elected to public office may withdraw pension funds to set up a personal business only after the person’s term of office had fully expired. It also states that funds can be withdrawn to seek medical treatment for immediate members of an employees' family.

The amendment also mandate the Pension Office to assemble a regulation that stipulates the amounts and conditions in which an employee may withdraw funds.

Fares-Maathoda MP Ibrahim Mutholib had also proposed amendments to the Pension Act in 2011 to make facilitate voluntary withdrawal of funds. The parliament voted to reject the amendment after it was proposed to the floor following committee review.

Pension Office had earlier raised concerns regarding the amendments that were rejected by parliament today. A survey conducted by Civil Service Commission (CSC) amongst civil servants had however shown that the civil servants supported the amendment. Out of the 81 institutions amongst which the survey was conducted, 80 offices had stated that they support voluntary withdrawal of money from the pension funds.