Parliament has unanimously approved a landmark package of amendments to the kingdom’s pension and social insurance laws, aimed at enhancing retirement benefits for citizens while maintaining the financial sustainability of the national pension system.
The legislative package covers three key laws – the 1975 Civil Servants Pension Law, the 1976 Military Pension Law and the 1976 Social Insurance Law – and has now been referred to the Shura Council for review.
Under the approved amendments, pension benefits will be recalculated based on the average of the final years of service, replacing the current five-year formula.
The reforms also reduce employee contributions from seven per cent to 6pc, increase the government’s share from 20pc to 21pc, and simplify pension eligibility requirements in cases of redundancy or non-disciplinary dismissal.
Another major change will see annual pension increases reorganised into a five-tier structure, ensuring that retirees with smaller pensions receive proportionally higher adjustments.
Senior officials, however, have urged caution.
Social Insurance Organisation (SIO) chief executive officer Sahar Al Mannai warned that any major changes to contribution or benefit formulas must be carefully evaluated to avoid destabilising the pension fund’s cash flows.
“The 2022 pension reforms were based on extensive actuarial and financial studies covering several years,” Ms Al Mannai said during the parliamentary session. “Any fundamental amendment could create imbalances in the fund’s financial flows. However, we remain open to proposals that support citizens without undermining the authority’s fiscal stability.”
She added that the organisation’s financial reports remain transparent and up to date.
Justice, Islamic Affairs and Endowments Minister and acting Parliament and Shura Council Affairs Minister Nawaf Al Maawda also intervened to clarify that figures were online for the public to see.
Despite these assurances, the session grew heated when MP Hamad Al Doy accused the SIO of ‘serious mismanagement’, claiming actuarial studies showed a BD14 billion deficit in the pension fund. He also alleged ‘poor investment planning’, arguing that plans to sell the Gosi Complex for BD9 million, for example, would fail to gain interest.
The amendments move to the Shura Council for review and Ms Al Mannai reaffirmed the SIO’s readiness to co-operate constructively.
“We are committed to solutions that enhance citizens’ welfare,” she said, “but any reform must also protect the financial future of the pension fund and the stability it provides for generations to come.”
Meanwhile, a proposal by 10 MPs, led by MP Hassan Ibrahim, for an open parliamentary debate to clarify the government’s policy on national programmes and initiatives directed at individuals with autism spectrum disorder (ASD) has been unanimously approved.
Arrangements with the concerned minister for attendance will be handled by Mr Al Musallam.
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