Pension office proposes reforms to ensure continuity of existing payments
According to Sujatha, the monthly cost of the basic pension for those aged 65 and above currently exceeds MVR 100 million.
The Maldives Pension Office has proposed amending the Pension Act in a manner that ensures the pensions of current beneficiaries are not disrupted.
The proposal was presented to the Parliament’s Finance Committee during a session held Monday.
Speaking at the committee meeting, Pension Office CEO Sujatha Haleem stated that the growing financial burden on the pension system is linked to the provision of pension benefits under various laws beyond the Pension Act. She said the office recognises the need for structural changes to the system but emphasised that any changes must limit the impact on those currently receiving or expecting to receive pensions.
Sujatha outlined several key recommendations for future pension reforms:
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No reduction in the pensions of current beneficiaries
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Amendments should not significantly affect those who are already retired or nearing retirement
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Set a clear date from which any changes would be applicable
She noted that the Maldives Pension Act has been in effect for 15 years and that several parallel systems have emerged. She suggested that any reform efforts aim to align these systems while addressing present and future demographic and financial realities.
According to Sujatha, the monthly cost of the basic pension for those aged 65 and above currently exceeds MVR 100 million. While 4% of the population currently receives the basic pension, this figure is expected to increase to 7% by 2030.
“Our population is ageing. By 2030, the number of beneficiaries will increase significantly. Adjustments need to be made with that in mind,” Sujatha said.
She also noted additional concerns related to pension sustainability:
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A declining number of contributors to the pension fund
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A possible need to raise the compulsory retirement age to 65
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Adjustments in pension payments to reflect inflation
Sujatha stressed that pensions are not intended to match previous salaries but to function as one component of a broader social security system that includes retirement insurance and housing.
Civil Service Commission (CSC) Chairman Mohamed Nasih also addressed the committee. He expressed concern over the handling of pension-related matters by multiple offices and recommended transferring all such responsibilities to the Pension Office. He urged the government to legislate the proposed changes without delay.
According to figures shared at the session, the number of pensioners currently receiving benefits under the Civil Service Act includes:
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5,300 individuals receiving the old age allowance
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1,612 individuals receiving pensions at age 55
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3,726 individuals receiving pensions at age 65
