According to the World Bank, in 2016 older persons made up 4.1 per cent of the population of Maldives, and by 2050 those aged 65 years and over will grow to make up 10 per cent of the total population. In an effort to provide access to income security for the growing number of older persons, the Government of the Maldives introduced two pension schemes in 2010, namely the Maldives Old-Age Basic Pension (MOABP) and the Maldives Retirement Pension Scheme (MRPS). The Maldives Pension Administration Office administers the MOABP and is responsible for investing contributions to manage the MRPS.
The MOABP is a non-contributory and universal pension scheme available to all citizens of at least 65 years of age who do not collect other pension income exceeding twice the amount of the basic pension. The initial pension level is set at MVR 2,300, or US 150 per month, which is reviewed periodically. The MOABP is designed to complement MRPS, which is a mandatory contributory scheme for all public and formal sector workers and voluntary for all informal sector workers, and can also be applied to migrant workers. The MRPS is funded by a total contribution of 14 per cent of salary split evenly between employers and employees. Workers can begin claiming monthly pension payments as early as 55 years of age, provided they have sufficient funds in their accounts to provide a monthly annuity that is at least twice the amount of the MOABP. While the MOABP provides coverage to nearly 100 per cent of the population, the MRPS reaches 100 per cent of the public sector and more than 70 per cent of those in the private sector.
Before the introduction of these schemes only public sector employees had access to income security. However, coverage became available to all Maldivians with the passing of the Pension Act in 2009. Investments, such as the MOABP and MRPS, create an essential part of the social protection floor in the Maldives and are essential in ensuring equal access to income security for older persons.
Further Reading:
Maldives Pension Administration Office (2013). Annual Report 2011. Accessed from http://en.pension.gov.mv/uploads/downloads/annual-report/57592d7116a5a.pdf on December 2016.