Bahrainis working in the private sector could soon be eligible for a one-off payment from the Pension Fund Authority (PFA) if they complete just five years of service and then quit.

Currently, employees are required to work for 15 years before they are eligible for a pension, said a report in the Gulf Daily News (GDN), our sister publication.

However, under the new plans - approved by the Shura Council yesterday - a private sector employee needs to work only for five years before they can apply for a one-off payment that will include all of theirs, their employer's and the government's contributions to their pension fund.

The original proposal to amend the PFA's by-laws, put forward by parliament, would have seen private sector employees eligible for a one-off payment without restrictions if they completed just three years of service.

But PFA officials earlier told the Shura Council's services committee that this would create a huge burden on its coffers as it would encourage people to change jobs several times in quick succession, in order to take advantage of the one-off payments.

"The amendment that will have private sector employees included is fair and will ensure there is choice similar to what others are getting," said committee secretary Abdulwahab Al Mansoor

"Parliament's amendments were unrealistic with just three years of work being required.

"However, the PFA's restrictions were also too strict, so we struck a balance between what MPs and pension officials wanted to ensure there is no misuse."

The amendments will be now studied by parliament and if approved will be sent for ratification by His Majesty King Hamad. - TradeArabia News Service