The Editor, Sir:

I have some concerns re the Government's intention to consolidate National Insurance Scheme (NIS) deductions with income tax and National Housing Trust (NHT) statutory payments. My concerns are grounded in experience as one who was responsible for the social security portfolio in the Ministry of Labour and Social Security for six years.

The concerns are as follows:

1. It is the intention of the Government to lift the insurable wage ceiling from the current limit of $500,000. They have not stated whether there will be a new limit or that no limit will be imposed. If the latter is the case, what will prevail?

With no ceiling in place, it means that workers will be required to contribute 2.5 per cent of their gross monthly income for NIS, for example. In other words, an individual who is earning $100,000 per month will be required to contribute $2,500 to the NIS. Under the existing regime, this worker would make a monthly contribution of 2.5 per cent on the first $40,000, which would amount to approximately $1,000. It, therefore, means that there would be an increase of 150 per cent on this worker's monthly contribution to the NIS, if there is no ceiling.

I would suggest to the Government that while they introduce the new collection mechanism this year, they maintain the existing wage ceiling and take the remainder of the year to educate all the stakeholders of the changes. This will at least give workers some reprieve.

The Government can get money from the National Insurance Fund (NIF) to facilitate this public education and consultation as the law governing this fund gives the minister authority to conduct activities that will promote its growth and development.

2. The other concern that I have relates to how this new consolidated arrangement will be done.

What legislative arrangements will be put in place to prevent the worker's pension contributions from falling into the Consolidated Fund?

Will there be a specified time frame, in law, for the Government to pay over monies collected on behalf of NHF, NHT and NIS?

Are employers, including the Government, aware that an increase in the insurable wage ceiling has implications for their budget.

In the context of the Government, was provision made in the Budget for them to honour their portion of the contribution that is to be made to the NIS?

I raise these questions, not in acrimony, neither with any sense of derision but for the Government and the other stakeholders to understand what is at hand.

I am, etc.,

FLOYD MORRIS

Former Minister of State

Bailey's Vale

Port Maria P.O, St Mary