NIS: paying now, resting easier later

We are not in the Winter of Discontent. At least, not yet. But we are very much into the political silly season where pigs fly, sensible men fight windmills and the prideful debate which is the better side of the egg to break.

It is no secret that Prime Minister Freundel Stuart’s Democratic Labour Party administration finds itself at a juncture of unpopularity that is perhaps unprecedented in its history. Of course, this does not automatically translate into exceptional popularity for Mia Mottley’s Barbados Labour Party either.

Both parties have their deathbed supporters. And issues which might appear grave or at least important, pale into insignificance depending on the popularity of the target. Then, issues which seem worthy of consideration attract derision because of the apparent unpopularity of the person or persons presenting them. Such is the political game.

Questions have been repeatedly raised about the legal qualifications of Miss Mottley. There are questions which can easily be put to bed by the production of the requisite documents. This has not been done, which, is within the rights of Miss Mottley. But though the queries might be politically motivated, they should still be put to rest by the person seeking to sit in the highest political office in the land. The questions have not raised a whimper from the Bar Association or the office of the Chief Justice. But this is no surprise, this is the Barbadian way. One is reminded of Donald Trump raising the issue of Barrack Obama’s nationality and as an individual seeking the highest political office in the land, the former president produced documented proof to put Mr Trump’s silliness to rest. But that was no surprise, that is the American way.

And so we arrive at another utterance from Mr Stuart that has brought some critical comment. The seemingly unpopular Mr Stuart of the equally unpopular Democratic Labour Party this week indicated that Government might strengthen laws to enable it to enforce contributions to the National Insurance Scheme (NIS) by self-employed persons.

Addressing the NIS 50th anniversary awards ceremony at the Lloyd Erskine Sandiford Centre, Stuart pointed to NIS figures that showed only 3,500 people who described themselves as self-employed being registered with the scheme but spoke of an estimated 20, 000 working for themselves in the informal sector.

He said that the estimated 16,500 people not contributing to NIS risked retirement without a pension and faced the danger of a steep drop in their standard of living.

 “I have heard of far too many cases where self-employed persons have simply not paid their contributions and then in their retirement live way below the standard to which they had become accustomed.

“I hold the view therefore, given how the stakes are, and for the very protection of the self-employed, that legislative intervention may now be necessary,” he said.

Mr Stuart stated that self-employed persons had to be convinced of the need to register and make sure that they could access the benefits when necessary.

“I am aware that several self-employed persons, and many in the informal sector, operate on a seasonal basis, but this is simply no excuse for non-payment since the threshold for payment is low,” he said.

His appeared a sound, reasonable argument.

But chief executive officer of the Small Business Association, Lynette Holder, saw Mr Stuart’s argument for the further securing of one’s golden years as “highly irresponsible”.  Miss Holder suggested the Government’s policies had drastically affected the ability of the self-employed to pay NIS contributions.

“Any time you see small business persons or self-employed persons struggling to pay taxes it is not because they are evil minded or ill-intentioned. The reality though is that small businesspersons have been struggling in this current climate,” Miss Holder noted.

Miss Holder expressed worries that the Stuart administration was not concentrating enough on fixing the macro-economic issues facing the country but was instead attempting to vilify the small businessperson. She said Barbadians by nature not only were generally law abiding, but were prepared to pay their fair share of taxes. She also highlighted the fact that Barbadians were not receiving VAT returns.

But stop the Press! Perhaps Miss Holder would have been on granite-like ground if the Prime Minister’s suggestion was totally outlandish or if the problem raised had dropped out of the sky in 2008. The failure of self-employed persons to pay NIS has been around across political administrations for decades and has been a feature in times of plenty and in times of need. The failure of self-employed professionals to pay taxes has also been a problem in Barbados for decades.

Miss Holder’s suggestion that Government must fix macro-economic issues is quite reasonable. But this cannot be an excuse to criticize a suggestion that laws are needed to encourage the self-employed to pay NIS. If statistics are to be believed those in the informal sector weren’t making adequate contributions to the NIS between 1994 and 2008, or between 1981 and 1986. And that state of affairs might continue in a Mia Mottley administration or in a third-term Stuart administration, whenever the general election is called.

Perhaps if Miss Mottley had made the suggestion about the NIS it would have elicited a different response. Who knows? But making suggestions that might ensure greater security for one’s golden years should have some merit irrespective of one’s lack of popularity or the seeming popularity of another.

2 Responses to NIS: paying now, resting easier later

  1. greengiant June 15, 2017 at 6:00 pm

    Ignore Lynette Holder, it’s because of the S B A leadership or lack thereof that their members fail to manage their businesses effectively. Even in the years of plenty, several members of the
    S B A didn’t pay their contributions.

    The S B A are always calling on government for developmental financing, but while the S B A assist members with incorporating their businesses, they have never set up any mechanism to assist them in paying their taxes or N I S contributions. All companies are operating in this environment, and even small operators should pay their contributions. There’s no excuse for this, as their children benefit from all the state funded opportunities they don’t contribute to. It’s time there be legislation to make this happen, and I hope it’s also policed efficiently. So Ms. Holder, I’m really ashamed that in your office you could make such statements. No business person who owes the state should be given access to the funds provided by the state for development. The day must come where if you’re in dept to the state, you can’t get state funded assistance until you clear the dept.

    Reply
  2. Big Man June 16, 2017 at 1:42 pm

    Most self employed people who did not Pay NIS end up with house falling down on them, in District hospital on the Streets after they got sick or pop down.

    Reply

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