BANDAR SERI BEGAWAN – Brunei will reform its pension scheme next year to boost retirement savings, His Majesty Sultan Haji Hassanal Bolkiah announced at the opening ceremony of the 18th Legislative Council (LegCo) session on Thursday.
The amended scheme is a follow-up to the Ministry of Finance and Economy’s (MoFE) study on raising the dividends of Employees Trust Fund (TAP) and Supplemental Contributory Pension (SCP) as the current rates are insufficient to support retirees.
Without providing details on the revised pension scheme, His Majesty said preparations for its implementation — including changes to the system and its dissemination — must be executed well for all to understand.
Employers are currently required to contribute 5 percent and 3.5 percent of workers’ wages to TAP and SCP, respectively.
The monarch previously raised concerns on the low dividend rates of TAP and SCP. Dividend rates had ranged from 2 to 2.5 percent in the past five years, compared to about 5 percent in Malaysia.
The sultan also announced that he had approved amendments to the Constitution (Financial Procedure) (Amendment) Order 2022 and Financial Regulations 2022, which will be enforced on April 1.
His Majesty said the country’s finances must be handled wisely and with discipline.
“Each appointed officer must understand that they are required to comply with existing financial regulations; not abuse their spending power; manage their administration based on priorities and needs; avoid wastage and conduct themselves in an orderly manner,” he said.
Economic diversification shows promising results
Speaking on the country’s economic diversification efforts, His Majesty said total exports of refined fuel products reached US$4 billion from January 2021 to November 2021.
He added that Brunei Fertilizer Industries, which began operations earlier this year, exported 6,200 metric tonnes of urea fertiliser on February 3.
“The influx of foreign direct investments into the country will open up employment and business opportunities for Bruneians and companies,” he said, adding that foreign investments will increase Brunei’s revenue.
Efforts are also being made to increase self-sufficiency in the agriculture, agri-food, fisheries and livestock sectors.
“Local rice production in particular has also begun to show results with an increase in rice-milling capacity. InshaAllah, with the implementation of this project, it will help farmers to focus more on paddy cultivation,” he continued.
The monarch said one of the lessons that can be learned from COVID-19 is the importance of food security as Brunei is also affected by travel restrictions in other countries.
“To some extent, this has affected the [import] of food items and increased the prices of goods and inflation,” he added.
The sultan said Brunei is not exempted from supply chain disruptions, but the Department of Economic Planning and Statistics is working to prevent price gouging.
MoFE preparing for next National Development Plan
His Majesty went on to say that MoFE’s National Development Plan Secretariat is preparing a roadmap for projects in the 12th National Development Plan, which is slated to begin in April 2023.
“This roadmap will apply the whole-of-government approach involving all ministries in an effort to ensure the National Vision 2035 is achieved,” the monarch added.
The five-year 11th National Development Plan will end in the 2022/2023 fiscal year.
This year’s LegCo proceedings are taking place under strict health protocols amid a record surge in COVID cases.
All attendees must perform antigen tests while members of the public are banned from entering the LegCo chamber hall where discussions are being held.