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Please clarify pension anomaly
If you think the confusion with the perceived cut in the senior citizens pension, with the increase in the NIS pension, is of great concern to us, just let me quote the Minister of Finance in the 2011-2012 budget: “We intend to eliminate the complicated and time-consuming benefit structure for retirement benefits by moving from a fixed earning class and dollar figure to a percentage of salary. “This will be one per cent of salary, up to a maximum of $10,000 for each of the insured’s years of contribution. A worker earning $10,000 per month, having contributed for 31 years, will simply be entitled to one per cent of $10,000 multiplied by the total years of contribution, in this case 31, which will give him a pension of $3,100 per month.” Let us substitute some figures in the minister’s equation. A person working for $4,000 a month, having contributed for 28 years, will receive one per cent of $4,000, which is $40 multiplied by 28, which equals $1,120. This is less than the present pension of $3,000 a month. Could the minister or someone else clarify this anomaly?
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