The Tribune

By LYNAIRE MUNNINGS

Tribune Staff Reporter

lmunnings@tribunemedia.net

THE Bahamas Public Services Union is opposing a cornerstone of the government's proposed pension overhaul, arguing that public servants who accepted jobs on the understanding that they would receive government-funded pensions should not be forced into a new contributory scheme years into their careers.

BPSU president Kimsley Ferguson said the union supports pension reform in principle but rejects a proposal that would require public servants with less than eight years of service to join the new pension plan.

Speaking on Guardian Radio's Morning Blend yesterday, Mr Ferguson said the measure would unfairly affect workers who entered the public service as permanent and pensionable employees.

"When they initially were employed, they were part of persons who were permanent and pensionable, and whose pension was provided for by the government,” he said.

The objection comes as the government presses ahead with long-awaited pension reform aimed at tackling liabilities estimated at $3bn and projected to climb to $4.1bn by 2032.

The White Paper, tabled alongside the 2026-2027 Budget, proposes replacing the existing taxpayer-funded pension system with a Contributory Public Sector Pension Plan requiring employees to contribute at least three percent of their pensionable salary and the government five percent.

Under the proposal, public officers who have not yet vested in the current pension system would automatically become members of the new fund, alongside future hires and employees who voluntarily opt in.

Mr Ferguson argued that workers who joined the public service under one set of retirement expectations should not have those terms altered years later.

"If you want to do this moving forward, that's fine, but you don't wait until somebody has seven years and divest them of their entitlement," he said. "That's contrarian. The union is not in support of that particular aspect of it."

While opposing that provision, Mr Ferguson said the union supports the broader shift to a contributory pension system, arguing that it could ease pressure on public finances while giving workers greater control over their retirement savings.

"I think a contributory pension plan is really something that we want to embrace," he said. "It sort of brings relief to the public purse, to some extent, and what it does, it allows the worker to determine what sizeable pension that they would have moving forward, or when they retire."

Mr Ferguson also questioned whether adequate consultation took place before the White Paper reached Parliament.

The government has defended the reform as necessary, warning that pension liabilities and annual payouts are placing growing pressure on the country's finances. According to the White Paper, pension payments to public officers are projected to increase from $154.4m this fiscal year to $166.75m by 2028-2029.

"The continued growth in pension liabilities and cash outflows is fiscally unsustainable," the White Paper says.