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Shura approves controversial revamp of pension rules

Bahrain News
Thu, 14 Jun 2018
Mohammed Al A'Ali

CONTROVERSIAL reform of the country’s pension rules was yesterday approved by the Shura Council, despite being rejected by parliament last week.

It paves the way for the first joint vote by both houses of Bahrain’s National Assembly, which will decide the outcome.

However, failure to hold the joint vote by June 27 would result in the bill being referred to His Majesty King Hamad to make a final decision – since it was presented by the government as an urgent bill.

Meanwhile, the 40-member Shura Council could ensure the amendments are passed by simply failing to show up for the joint vote.

That is because at least 41 members of the 80-seat National Assembly, which also includes 40 MPs, must be present – otherwise the changes are automatically approved.

The amendments give the government authority to alter pension rules without input from the National Assembly, but MPs claim this will result in a lack of accountability.

However, 31 of 37 Shura Council members present during an extraordinary session yesterday approved the amendments to the 2008 Pension Fund Authority Law, while three opposed, two abstained and chairman Ali Saleh Al Saleh chose not to vote at all.

Similar amendments to the 2010 BDF and Public Security Pension Fund Law were also approved, with 32 in favour, three opposed and two abstaining – a vote in which Mr Al Saleh took part.

If the National Assembly goes ahead with a joint vote, it will be the first time it has happened since it was established in 2002.

Some Shura Council members yesterday said the Constitutional Court should rule on whether the amendments are legal.

However, Finance Minister Shaikh Ahmed bin Mohammed Al Khalifa said reform of the pension rules were “necessary”.

The government-drafted amendments would give the chairman of the Pension Fund Authority (PFA) power to authorise changes to the system without legislative approval.

This includes the level of contributions, the period they should cover and whether pensions should rise, as well as the age of retirement and voluntary contributions for periods when no payments have been made.

The power to amend military and security pension rules would be determined by the Supreme Defence Council.

MPs, Shura Council members and municipal councillors are among those who stand to lose the most, since dual pensions – currently paid for their public service work and personal careers – would be scrapped.

Shura Council financial and economic affairs committee vice-chairman Dr Abdulaziz Abul opposed the amendments and accused the PFA of mismanaging public funds.

“Regular studies show the pension funds are at risk and it is time we stop taking things lightly,” he said.

“Time has changed and we need a tougher stand.”

However, Shaikh Ahmed reassured the chamber about the security of public pensions – saying investments were being made through Osool Asset Management and Amlak Bahrain.

“We have huge property in the sea that we will reclaim and invest in, but are waiting for the right moment to do so,” he said.

“Not everything comes from people’s pockets. We have many initiatives to strengthen the funds and ensure equilibrium.”

Military Court president Major General Dr Yousif Flaifil argued the amendments were not unconstitutional, as claimed by MPs.

He added those already retired would not be affected by the changes.

Thousands of Bahrainis, however, took to social media yesterday to express their anger at the Shura Council’s decision.

Many even demanded the scrapping of the Shura Council, which is Bahrain’s upper chamber, and only keeping parliament.

A hashtag in Arabic about the decision was trending on Twitter all day.

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