BY NEIL HARTNELL
TRIBUNE Business Editor
nhartnell@tribunemedia.net
A CABINET minister yesterday pledged to reject calls for higher employer and employee contributions as the primary way to rescue the National Insurance Board (NIB), asserting: “Not on my watch.”
Pia Glover-Rolle, minister of labour, public service and National Insurance, told the Exuma Business Outlook that she is going against the advice of actuaries, financial analysts who model the solvency of insurance schemes, and insisting that further contribution hikes are her “last option” and a final resort.
She added that she has charged NIB’s new Board, headed by attorney Michelle Pindling-Sands, with exploring other methods for ensuring the social security scheme’s long-term solvency such as diversifying its $1.166bn investment portfolio both inside and outside The Bahamas, as well as maximising the returns from its extensive real estate holdings.
Mrs Glover-Rolle, also revealing that increasing the retirement age is under active consideration as a means to boost NIB’s sustainability (see other article on Page 1B), added that she is determined to hold-off on “going back to the people and asking for an increase in contributions”.
This directly contradicts, and goes against, the top recommendation in NIB’s last 11th actuarial report, which called for a 2 percent contribution rate increase to be implemented every two years between 2022 and 2036 to “restore the short and medium-term financial sustainability of the scheme”.
The first Davis administration raised the overall contribution rate by 1.5 percentage points, split equally between employer and employee, from 9.8 percent to 11.3 percent on July 1, 2026. Yet there have been no further hikes since then even though NIB itself, in its latest 2022 annual report, warned its $1.1bn reserve fund is in “jeopardy of being depleted by the year 2028” without major reforms.
That date is now just two years away. But Mrs Glover-Rolle, while reiterating that NIB’s “long-term sustainability” is one of her key ministerial priorities, said the social security system must look at more creative and innovative means to plus the annual deficit between contribution income and benefits expenditure which, in 2025, was forecast to be $29m.
“I have charged them with delivering measurable results during this term,” the minister said of the NIB Board. “Our agenda includes diversifying investments” plus “strategic development of our real estate portfolio, modernising, improving collections and greater accountability”.
She explained: “We’re strengthening and diversifying the investment portfolio for greater returns for the Fund, and we are utilising NIB’s significant real estate holdings as long-term sources of revenue. This will further enhance our sustainability efforts.
“So, basically, I have said to the Board, as opposed to going back to the people and asking for an increase in contributions, we will see how we can grow our Fund through investments, through diversifying our Fund, and ensuring we look other means of sustainability.
“In regards to our real estate assets, how do we develop them and make them revenue-generating properties that they serve” the needs of NIB and its beneficiaries.
“My last option is to go the people and ask them to give more,” Mrs Glover-Rolle said. “We have to be creative and understand that, as we look at NIB’s sustainability… and, yes, actuaries have repeatedly put as the number one method to increase contributions. I say: ‘Not on my watch’. We are looking at creative ways for the sustainability of the Fund….
“What are we doing in terms of investments in the NIB to diversify outside our country and see how we can grow our Fund, and how we are using our investments in terms of our current investments, like real estate, to ensure there is growth, to ensure there is sustainability, and to ensure we are making the Fund’s money work for the people.”
Much of NIB’s real estate portfolio is leased/rented to other government ministries, departments and agencies. Dr Tami Francis, the social security system’s director, told the Bahamas Business Outlook in January that contribution rate increases are one tool in a broader package and will “not secure the National Insurance Fund’s future” by themselves.
She revealed that NIB’s 1.5 percent rate increase on July 1, 2024, had increased contribution income by an average of $4m per month. This, Dr Francis added, had driven total contribution income to an estimated $413.6m in 2025, representing a $51.3m increase over the prior year.
However, while this surge helped to reduce NIB’s projected 2025 deficit by some $3m, she explained that relying solely on contribution rate increases will not be enough to eliminate the social security system’s “structural imbalances” caused by benefits payouts continuing to exceed income as the Bahamian population continues to age with fewer workers supporting elderly persons.
Dr Francis added that COVID-19 unemployment and other benefits payouts had been a key factor in cutting NIB’s reserves by more than $600m over the six years to 2025 despite the 14 percent year-over-year income increase enjoyed in the latter period.
Mrs Glover-Rolle, meanwhile, yesterday said NIB has “no choice” but to invest in technology upgrades and improvements given that its current IT systems have reached their “end of life”. Likening the situation to an old house, where appliances are going bad because they were all bought at the same time when the property was brand new, she added: “That’s where we are as a nation…
“At NIB, the technology is at or near end of life, so we are making technology upgrades and digital enhancements that allow NIB to process claims faster, to collect contributions more efficiently and effectively, and give Bahamians a more modern experience when engaging with NIB.”
Identifying improved customer service for employers, employees and beneficiaries as another of her key priorities, Mrs Glover-Rolle foreshadowed other policy changes and initiatives. “We are also revising our policies so employers and workers who bring delinquent accounts up-to-date have a clear path to compliance,” she said.
“We have received complaints that you bring your accounts compliant, but still cannot benefit from the contributions. Because contributors who regularise their accounts have to be able to access the benefits their contributions have earned. Some people take their last to bring their accounts current, and then they are told they don’t qualify.
“We have made it a point to look at policies like that that aren’t serving our customers well, and we are going to listen and ensure we put those corrections in place from a policy perspective.” Mrs Glover-Rolle said NIB has just launched its ‘Have You Checked?’ initiative to encourage both employers and workers to make sure their contributions are in order before they need their benefits.
“NIB has an obligation that extends across generations. We have to manage our resources responsibly for the future for those of us still in this room, and those of us coming behind us so we can access the benefits and services needed and expected from the NIB,” the minister added, promising that “other major changes” - which she did not identify - are coming,
Mrs Glover-Rolle also urged employers to ensure that they register with NIB, file accurate reports and make contribution payments on time.