Opposition concerned about the use of NIF in housing development

Opposition Spokesman on Labour and Social Security, Derrick Kellier, has raised concern about the use of $1.2 billion from the National Insurance Fund in a housing development.

Mr. Kellier took on the issue during the debate on the National Insurance Validation and Amendment Bill in the House of Representatives on Tuesday.

The Opposition Spokesman claimed that the money which was used to buy over two hundred residential lots could have been better invested elsewhere. 

But he says his concerns are far much deeper.

“I think it is only fair that the House gets further and better particulars about this deal, how much was owed at the time of consummating this arrangement, how much money was owed by the Montego Park Estates Company and whether or not it was in the best interest of the sustainability of the fund and the development of the fund to have made such a deal with the NIF money, with the people’s contribution. What we have bought here is a whole heap of land,” Mr. Kellier said.

And the National Insurance Fund racked up a multi-billion dollar deficit during the 2009/2010 fiscal year.

According to Social Security Minister Pearnel Charles the pay out of benefits exceeded inflows from contributions.

During the year, $5.5 billion was collected from contributions while $9 billion was disbursed in benefits.

Mr. Charles told Parliament that as result, the Fund had to depend more on investment income to close the gap.

It is projected that the annual cost of benefits will increase to $11 billion this year.

The Government is hoping that increases in NIS contributions will help to stabilize the Fund.