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Pension scheme ramps up

Pension scheme ramps up

121211_03

A garment worker cuts cloth at a factory in Phnom Penh. To date over 700,000 workers atprivate companies and factories have registered to join a nationwide pension scheme thatwill go into effect in 2015. Photograph: Will Baxter/Phnom Penh Post

More than 700,000 workers at private companies and factories across 19 provinces have registered to join a nationwide pension scheme that goes into effect in 2015, Labour Ministry officials told the Post yesterday.

A branch of the National Social Security Fund (NSFF), the pension scheme was legislated a decade ago, but registration was only set to start this year.

Since January, 720,000 employees have registered for theplan, which will be mandatory for all companies with more than eight workers.

But while officials have stepped up their registration efforts, precious few details appear to have been ironed out for a scheme that both industry insiders and the government have pegged as acornerstone of social welfare.

“I cannot say yet how much the workers have to pay and how much they will get for their pension. We will announce that to them later,” Sum Sophorn, deputy director of the NSSF, said yesterday, addingthat projections were impossible to make before all eligible workers had registered.

Now, only government employees and veterans are eligible for government-run pension plans, which economists have noted barely pay a living wage, making them untenable as a financial bedrock.

To receive the pension, said Sophorn, workers will have had to be registered with NSSF for at least 20 years and have been paying into the fund for at least five of the past 10 years before retirement.

Eligibility kicks in at the age of 55. “They will receive their pension every month after they retire until they die,” he said, adding that, in 2014, the ministry will issue prakases setting the payment parameters.

“We cannot write it down as we want [yet], but we need experts to work on the prakases to find out what per cent [workers] will receive, how much they will need to contribute and what they do if they cannotmeet our conditions,” said Sophorn.

President of the Cambodian Confederation of Unions, Rong Chhun, said he looked forward to seeing how it was implemented and was pleased such schemes would soon be open to all workers.

“I welcome that private-sector employees can receive the pension. It’s time for our country to do the same as other countries for their workers in the private sector,” he said.

 To contact the reporter on this story: Mom Kunthear at [email protected]

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