KUWAIT: Rapporteur of the National Assembly’s budgets committee MP Riyadh Al-Adasani said yesterday that the actuarial deficit of the Public Institute for Social Security, or the pension agency, has almost doubled in the past three years, mainly due to lower returns on investments. Adasani said that the actuarial deficit – the difference between future obligations and current income rates – rose between KD 9 billion and KD 17.4 billion in the past three fiscal years through March 2019.
He said the actuarial examination is important as it estimates the agency’s capability to meet its future obligation payouts, adding that the independent report on the agency indicated that the increase in the deficit resulted mainly from a sharp drop in the returns on investments to just under 4 percent in the last fiscal year, from 5.7 percent in the previous year. Adasani called for diversifying the agency’s guaranteed and safe investments to achieve optimal returns and consequently reduce the financing of the deficit by the state.
In a related development, the Assembly’s financial and economic affairs committee yesterday held a meeting to study proposals to amend the controversial early retirement law which was passed by the Assembly just before it went into summer recess. The law was criticized by lawmakers because they claimed that it allowed ministries to force Kuwaiti employees to go into early retirement against their will.
Head of the committee MP Salah Khorshed said a crucial meeting will be held on Sept 22 attended by Finance Minister Nayef Al-Hajraf, who did not attend yesterday’s meeting because he is outside the country. MP Khalaf Dumaitheer said the meeting did not agree on any of the amendments proposed, adding that representatives of the pension agency presented the cost of various amendments. The lawmakers want to allow certain Kuwaiti employees to go into early retirement voluntarily without losing much of their pension benefits. The government does not want to make the bill too expensive.
Meanwhile, MP Abdulkarim Al-Kandari, head of the Assembly’s foreign relations panel, yesterday sent questions to the foreign minister about the diplomatic dispute with Iraq, inquiring about the Kuwaiti response to the issue.
By B Izzak