BAHRAIN’S pension funds will now fully come under the legislators’ scrutiny.In its final session of the year yesterday, the Shura Council unanimously approved an insertion to the 2018 Social Insurance Organisation (SIO) Set-up Law which will allow Parliament and the Shura Council to monitor the funds.

The SIO will now be obliged to submit closing statements on its finances and pension funds to the two chambers of the National Assembly.Parliament last month unanimously approved the legislation originally presented by the Shura Council.However, MPs amended the inserted article to state: “The government is obliged to present the SIO’s closing financial statement alongside that of civil service and private sector pension funds within a maximum five months to Parliament starting January 1.”The SIO’s financial statements will not be officially recognised until it’s published in the Official Gazette, following approvals from both Parliament and the Shura Council, accompanied by legislators’ observations and recommendations.It has been referred to Parliament to review for minor wording sequence change before being sent by Speaker Ahmed Al Musallam to His Majesty King Hamad for ratification.Shura Council financial and economic affairs committee chairman Khalid Al Maskati described the move as a positive breakthrough in parliamentary monitoring of public funds.

“Parliament and the Shura Council will now have the power to scrutinise SIO’s closing financial statements in addition to all monetary affairs of the civil service and private sector pension funds,” he explained.“This will enable legislators to determine the best course of future operations through precise observations and recommendations.“The aim is to support the sustainability of the SIO and funds under its umbrella, in addition to enhancing transparency and ensuring the management and investment of public money with minimum risks.”Shura Council services committee chairwoman Dr Ibtisam Al Dallal said legislators had every right to monitor spending and revenues of public authorities.

“The SIO’s operations wouldn’t be hindered or affected, considering that internal and external audits are conducted after December 31,” she explained.“Legislators have a different role, it is monitoring performance and giving recommendations on the mode of operations – and not the audited numbers.“The move is a boost to legislators’ monitoring authorities as it follows a similarly approved legislation this year to have the Unemployment Fund’s closing financial statement come under Parliament and the Shura Council scrutiny.”Committee vice-chairwoman and secretary Dr Jameela Al Salman explained that the legislation would see all finances reviewed by legislators.“The legislation covers all revenues and spending whether government/employer/employee contributions, finances, fees and donations, investments, and any other income,” she said.“There will no stone unturned when it comes to SIO’s affairs and pension funds.”Outspoken member Abdulla Al Nuaimi said officials entrusted with pension funds should be dedicated.

“Pension funds are sensitive and entrusted officials should be sincere and genuine and come up with out-of-the-box ideas on developing revenues through innovative investments and proper planning,” he added.“I want dedicated people who work effortlessly. Why not give them incentives and lucrative pay as those in banks, if it will ensure better performance?“I still believe that getting a closing statement is way too late, we should be getting regular reports on operations throughout the year, but again something is better than nothing.”The GDN reported earlier that a roadmap was unveiled by Finance and National Economy Minister and SIO board chairman Shaikh Salman bin Khalifa Al Khalifa to prolong the lifespan of Bahrain’s pension funds up to 2086.

In 2019, Shaikh Salman told MPs in writing that studies indicated that the government pension funds will go bankrupt by 2028 and the private sector by 2034 with total deficits being BD14.4 billion in 2018.SIO chief executive Eman Al Murbati earlier told Shura Council members that legislators had already authorised the SIO board, through law, to take necessary action regarding operations and internal and external audits.However, the stand has since changed with the government giving the go-ahead for the legislation, following an understanding on the mechanism with MPs.

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