Kuwait scrutinizes retirement benefits for individuals whose benefits were terminated for acts of honor or dignity
The Kuwaiti government is currently reviewing the potential costs associated with pension payments for retirees whose citizenship has been revoked. As of now, no specific decision has been made on this matter.
The Social Insurance Corporation, which oversees the country's social insurance system, currently covers a total of 715,282 civilians and military personnel. Within this number, there are 160,657 civilian and 39,587 military retirees who receive monthly pensions.
The Ministry of Finance is conducting a study to estimate the costs for various hypothetical scenarios, with the aim of preventing unexpected pressures on the general budget when a decision is eventually made.
One such scenario under consideration is the revocation of citizenship for "outstanding achievements." In this case, it is expected that 192 pensions will be revoked, amounting to approximately 79 million Kuwaiti Dinars. It's important to note that this figure represents the total cost of the pensions and does not include any additional benefits like financial rewards or interest-free loans.
Another scenario being reviewed involves retirees whose citizenship was revoked for "excellent deeds." In this case, the pensions would be disbursed using the same mechanism under Article 8 of the Social Insurance Law.
Eligibility for retirement pensions under Article 8 requires at least 15 years of service, excluding days of absence, and reaching the prescribed retirement age, which is 50 for women. The amount of the insurance bonus varies depending on each individual's years of service and the value of their monthly premiums.
The Ministry of Finance is also reviewing the cost of addressing the cases of retirees whose citizenship was revoked under Article 5 of the "Gracious Works" Act. However, no specific details about this scenario have been disclosed.
It's worth mentioning that the Social Insurance Corporation would record the payments as a one-time expense on its balance sheet, constituting a non-recurring general expense. Furthermore, the corporation would not be obligated to provide a retirement pension to the individuals or their heirs for life under this scenario.
The total monthly cost of pensions disbursed by the Social Insurance Corporation is estimated at approximately KD 300 million. Among government-sector insured persons, there are 124,526 males with an average salary of KD 733 and 201,237 females with an average salary of KD 570.
The Social Insurance Corporation has issued a circular detailing the procedure for notifying end of service and the documents required to disburse retirement pensions to individuals whose Kuwaiti citizenship was revoked under Article 8. The exact decision on handling insurance benefits for these retirees is yet to be determined.
