As is customary every year, Seychelles Pension Fund, in accordance with Regulation 36 of the Seychelles Pension Fund (Benefit Regulations), as amended in 2013, reviews monthly pensions being paid out for indexation purposes, if applicable. Effective January 2020, the majority of pensions have been increased by 2.11%. This is to cushion members’ pension from inflation, making it adequate, as a pension is an earning replacement income.
Indexation adjusts pensionable income to the rate of inflation prevailing in the country as at the end of October each year and is calculated by the National Bureau of Statistics (NBS). The indexation rate for 2020 of 2.11% is the percentage change in the annual average Consumer Price Index (CPI) as at October 2019.
To note that indexation rate for 2019 was 3.65% and it changes from year to year depending on the CPI published by NBS.
The indexation of pension is for every member drawing a pension up to the amount of SCR 75, 750, which is the maximum pension payable, which are on the SPF pension payroll as at 31st December 2019 and in receipt of either a retirement, permanent incapacity, surviving spouse and/or children monthly pension. . Indexation is only applicable to monthly pensions paid out and not lump sum refunds. For example, if a member was receiving a monthly pension of SCR 10,000 per month as of December 2019, their pension in 2020 would be SCR10,211 per month after indexation.
With the introduction of a minimum pension of SCR 1000 payable also from January 2020, the indexation will mean that a member previously receiving SCR 450 as a pension will now receive an increase of SCR 9.50 as per the indexation, making the pension SCR459.50 and a further increase of SCR 540.50 to make the pension the minimum amount of SCR 1000 that SPF will hereafter be paying each pensioner.
