The current law states a member who has become a resident in the Cook Islands solely to work on a contract of employment of not more than three years, is entitled to a benefit on their permanent departure from the Cook Islands.
That benefit will be paid as a lump sum equal to the total of their employee contributions (5 per cent) plus investment earnings in the period plus any balance in their voluntary account.
The employer contribution of 5 per cent is withheld by the Fund and put into the Reserve Fund which is later shared among the members.
CINSF Chief Executive Officer Damien Beddoes says they want a change in that so that a member who qualifies for withdrawal also takes home the employer’s contribution.
However, under the proposed changes, the member will have to forfeit the employer contribution if he or she opts for lump sum withdrawal.
Beddoes says that member will only receive the lump sum of his contribution to the Fund on the permanent departure from the country.
Under the proposed changes, a member will only be entitled to the full contribution (employer and employee) if he or she agrees to transfer the fund to the Superannuation Fund in his or her country.
Beddoes says they will be putting the changes to members at the October Members General Meeting, before submitting to Parliament for its consideration and approval.