Pension Fund and Social Insurance Funds Merged

Bahrain’s King has issued Bahrain Decree-Law No. 21/2020 on the funds and pension salaries in laws and pension and insurance regulations. Under Bahrain Decree-Law No. 21/2020, the pension fund for Government employees established by Bahrain Law No. 13/1975 and the social insurance fund established by Bahrain Law No. 24/1976 will be merged into a Pension and Social Insurance Fund. The Fund’s revenue will be generated from the contributions previously paid into the previous funds as well as revenue generated from its investments or other activities. The Pension and Social Insurance Fund will be supervised by the Social Insurance Organisation. The annual increase in all pensions established under any law, pension or insurance scheme will be stopped. Where the Actuarial Report detects a surplus in the Pension and Social Insurance Fund or the Pension Fund for Bahraini and non-Bahraini officers and members of Bahrain’s Defence and Public Security Force, established by Bahrain Decree-Law No. 6/1991, the surplus will deposited in a fund which is independent from both funds. The surplus may be used, based on the approval of the Supreme Council for Military Retirement and the Social Insurance Organisation Board of Directors, to increase pensions in a way which does not exceed the increase in the Consumer Price Index and take the situation of retirees with low pensions into account. Under the Law, retirees cannot receive more than one pension under different retirement and insurance systems, except for those entitled to pensions because of disability, work accidents or kinship. Pensioners who are covered by previous laws and get jobs which are not subject to the same law under which they are entitled to the pension may combine their previous service period with their new service period, according to the rules stipulated in the retirement and insurance laws and regulations. They may also choose to continue receiving their pensions for their previous work period, in addition to the salaries they earn from their new jobs provided they are not subject to retirement laws and insurance against work accidents. Employers who fail to pay the insurance contributions under Bahrain Decree-Law 24/1976 (the Social Insurance Law) will have to pay a fine between the total value of the unpaid contributions and three times its value. The value of the fines will be referred to the Pension and Social Insurance Fund. The Supreme Council for Military Retirement and the Finance and National Economy Minister will issue the necessary edicts to implement the Decree-Law, based on the approval of the Board of Directors of the Social Insurance Organisation. The Prime Minister, the BDF Commander-in-Chief and the relevant ministers will be responsible for implementing the Decree-Law which will come into force one month after its publication in the Official Gazette. Histoire complète

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