GRTU wants fairer pensions for self-employed, business owners

The General Retailers and Traders’ Union (GRTU) has called on the government to introduce a fairer pension system for self-employed people and business owners.

“Our self-employed and business owners have not only contributed heftily in financial terms over the years, but are also the main drivers of economic development and job creation,” the GRTU said in a statement. “Their contribution must be acknowledged and translated into the pension they have contributed for and deserve.  

“The current system is unjust especially when considering that other sectors of society, such as former Members of Parliament, are treated differently with no maximum capping on their pension.” 

“This measure should not only ensure a fairer pension to this sector of society but also disincentivise under-claiming of income, upon which an individual is to be taxed.”

The GRTU also proposed that self-employed people be allowed to retire early for cases where they are close to their retirement age and their businesses are no longer feasible.

They said that incentives and measures being put forward need to be financially viable if take-up is to be registered once implementation is transposed from paper into practice.

“While some of the incentives proposed in the pension reform may seem welcoming on paper, they do not make financial sense for end-users,” the union said. “In practice however it would take too long to recuperate the renounced pension itself.

An effective measure that GRTU believes would really incentivise pensioners to remain active in the labour market is the reduction or removal of taxation on pensions for working pensioners, or removal of NI contributions.

They warned that the drive towards highering the working age, whether through incentives or imposed, also comes with its concerns.

“These may include sector-sensitivity matters based on issues such as the extent of physical activity or health hazards this may pose on ageing persons; as well as issues related to productivity and career opportunities.” 

“A stronger overall reform is necessary to sustain first pillar pensions whilst incentivising diversification,” GRTU said. “We believe that a long-term approach is needed to start addressing seriously the sustainability of the pensions system in the context of its social importance along with its economic viability.  The change must be gradual however change to the status quo is necessary. Postponing will only make matters worse and make change more difficult and costly.”