The National Pensions (Amendment) Bill, 2023 received approval in Parliament on 23 November 2023.
The amendments approved aim to increase the maximum amount permitted for withdrawals from pension plans for specific purposes such as:
making deposits on the purchase or construction of homes
purchasing residential property
making reduction payments on mortgages or residential land loans
paying off mortgages
The Government’s objective is to improve the overall quality of life for Caymanians by creating and enhancing varied pathways to home and/or property ownership. With the increased inflation and interest rates, allowing withdrawals from pensions for strategic purposes, the Government aims to empower Caymanians to make decisions that are in the best interest of their long-term financial health.
Minister for Labour, Hon. Dwayne Seymour, said, “I extend my deepest gratitude to the esteemed members of Parliament for their unwavering support in endorsing the private member motion brought forward by my colleague from Bodden Town West to amend the National Pensions Act. This pivotal step forward reflects our shared commitment to enhancing the well-being of our citizens. Together, we stand united in our pursuit of a stronger and more compassionate society."
Persons are reminded that these pension withdrawals are not a way to receive immediate cash in hand; instead, these are strategic withdrawals aimed at specific life milestones. Funds withdrawn from pension plans for these purposes will require repayment of an additional 3% monthly contribution into the member’s pension as a way to safeguard funds being available after retirement.
Persons who wish to withdraw from their pension plan will need to complete a form and file the required documentation with their pension plan administrator. The required forms will be available from their pension plan and can be found at www.gov.ky/border-control-labour
As a reminder, persons under the Public Service Pension Plan, Parliamentary or Judicial plans are not able to make withdrawals as they are governed by different legislation.