Various countries across the world have been exhibiting a converging demographic pattern due to the increase of life expectancy and reduction of fertility rates. This pattern brought about significant adjustments to population pyramids, the labour market structure and wages among others. While these shifts impact across the configuration of social organisation, one element greatly impacted by such is that of retirement pension systems.
Malta’s State pension is a pay-as-you-go pension system, with the funding of such happening through the diversion of social security contributions from workers to pensioners. Drastic declines in fertility rates combined with increases in life expectancy are causing funding pressures due to shrinking workforce coupled with increases to the percentage of people reaching retirement age.
It is crucial to go beyond the analysis of sustainability and also consider the adequacy of pension income. Adequate pension solutions require the concentrated effort of society in general. While State pensions should constitute a solid foundation, they should not be the only source of retirement income, but rather supplemented through private retirement savings. Large number of people lack awareness of the importance of retirement savings and tend to keep on postponing pension-related decisions. Employers play an important role and may be considered as choice architects – they are in a unique position to educate the workforce and help their employees take positive steps in accomplishing their retirement goals. Malta has gone down the route of encouraging Occupational Pension Schemes through fiscal incentives, with potential tax recoveries of up to 60 per cent of contributions placed.
Mapfre MSV Life offers flexible retirement solutions, which can be tailored to meet the needs of both employers and employees. Occupational Pension Schemes are long-term commitments. When arranging an Occupational Pension Scheme for your employees, you should ensure to select a provider that has the financial, operational and technical capacity to deliver long-term quality service and support. Mapfre MSV Life is the appropriate partner to improve your employee benefits package. We will guide you with setting up and managing a Pension Scheme, which will help attract and retain talented employees.
The Mapfre MSV Life WorkSave Pension Scheme is a registered Voluntary Occupational Pension Scheme, approved by the Commissioner of Inland Revenue as a Qualifying Scheme in accordance with the Law.
Mapfre MSV Life p.l.c. (C-15722) is authorised by the Malta Financial Services Authority (MFSA) to carry on long-term business under the Insurance Business Act. Mapfre MSV Life p.l.c. is regulated by the MFSA. Any statement about taxation is based on our understanding of current law and tax practice.