pension.gov.mv Maldives Retirement Pension Scheme MRPS : Pension Administration Office MPAO

Name of the Organization : Maldives Pension Administration Office (MPAO)
Type of Facility : Maldives Retirement Pension Scheme (MRPS)
Country : Maldives

Website : https://www.pension.gov.mv/dv

Maldives Retirement Pension Scheme (MRPS) :

Maldives Retirement Pension Scheme (MRPS) is the first defined contributory pension scheme in the Maldives.

Related : Maldives Pension Administration Office MPAO State Funded Pension Schemes : www.statusin.org/7720.html

It is funded through contributions from both employees and employers. Presently, the Pension Act mandates a contribution of 7% of the pensionable wage from both employee and employer. It also allows voluntary contributions. The scheme participants are required to drawdown on their pension plan upon reaching pensionable age of 65 years.

MRPS stands for Maldives Retirement Pension Scheme. The purpose of MRPS is to provide the participants with a regular retirement pension. The Scheme is funded through contributions from employees and employers while in employment.

Defined Contribution Scheme:
defined contribution scheme is a pension plan whereby employer and employee contribute a defined amount while in employment on a monthly basis. In case of MRPS, the mandatory contribution is 14% (which is 7% from the employees and 7% from the employer) of the pensionable wage of the employee. Under this plan the pension benefit payout at retirement is based on the amount the participant has contributed over his/her working life, plus any investment returns.

Pensionable Wage:
Pensionable wage is the basic salary specified in the contract of employment.

Am I required to participate in this scheme?:
Under the Pension Act, participation is mandatory for all employees where there is a contractual relationship with an employer, and in case of self-employed the participation is voluntary.

What would be the administrative arrangement for an employee to participate in MRPS?:
All administrative arrangements including registration of the employee, submission of contributions statements and payment of contribution is a responsibility of the employer.

What are the administrative arrangement to register, enroll employees, submit Statement of pension Contributions (SPC) and settlement of payments?:
Employers are required to register in the MRPS by filling the registration form. This can be downloaded from the MPAO website. After this process the employer will be notified with an employer ID and a passcode by MPAO.

Employer may then log into the MRPS portal using these credentials and enroll all employees in MRPS.

Employer then can submit monthly SPC’s and receipt notices could be generated through the system.

The employer then should raise a cheque to the amount indicated in the receipt notice and take both the cheque and receipt notice to any branch of Bank of Maldives (BML) before 15th of following month after the payment of monthly salary. Failure to submit SPC on time would result in the employer being fined.

Can my employer make the total contribution on my behalf?:
Yes. The Act does not restrict the employer to make the full 14% of the contribution on behalf of the employees.

I have a company/Shop that does not have any employees. Do I still need to register in MPRS?:
No. if you do not have any employees it is not necessary to register as an employer in the MRPS. But as soon as an employee is been recruited you will be required to register in MRPS.

Is it mandatory for expatriates to participate in MRPS:
It is not mandatory for expatriates to participate in MRPS. Under the 2nd amendment to the Pension Act, participation of foreign employees in the Retirement Pension Scheme has been made voluntary. Foreign employees who wish to participate in the Retirement Pension Scheme may participate and contribute to the scheme, provided that their employers are willing to pay the employer contributions and undertake the required administrative work.

What happens with the money in my Retirement Savings Account (RAS) if I die before I reach pensionable age? And what happens after I reach pensionable age and already withdrawing from RSA and there is remaining amount in RSA at the time of death?:
The money in your account legally belongs to you. Therefore, if you die before reaching pension age or after and withdrawing or not, the total or any remaining amount in your RSA will be paid to your legal heirs. Payment shall be made in the form of a lump sum to beneficiaries determined through inheritance law and the money will be disbursed through the courts.

What happens to my retirement savings account when I change jobs?:
Any time you change jobs, you will still keep the same retirement savings account. Your new employer will be responsible for making contributions to your existing account. In other words, no matter how many jobs you have been employed during your career, you will have only one retirement saving account that will be maintained by MPAO.

I have an illness, injury or disability. Can I spend the money in my retirement savings account for medical purpose?:
At the moment it is not possible to withdraw money in your retirement savings account to meet your medical expenses. However, disability benefit is part of the scheme that will be addressed in future.

How do I know how much money I have in my retirement savings account?:
The pension office will provide individual member account statements at least once in a year. The statement will provide the details of your RSA

You can view your Retirement Savings Account statement through MPAO website at any time or request for a written statement.

Who is responsible for investing pension assets?:
MPAO is responsible for investing pension assets. MPAO can also assign asset managers to manage the pension assets. The board is responsible for the oversight of the investments.

The Pension Act requires the formation of investment committee as a subcommittee of the board. The Investment committee formulates the Statement of Investment Principles (SOIP) which provides guidance on Investment Strategy and risk management in line with Pension Act.

How would the pension assets be invested?:
Pension Act states that assets should be invested in a prudent manner, that is solely for the benefit of the participants. Pension assets can be invested in securities that are publicly traded, issued by banking institutions that are appropriately licensed and securities of the government, The Board of MPAO is required to make its investment decisions with the following objectives in mind:
** Security of assets
** Diversity of assets
** Maximum return while minimizing risks
** Maintenance of adequate liquidity.