Seafarers' Pensions Convention, 1946 (No. 71) - Panama (Ratification: 1971)

Direct Request (CEACR) - adopted 2015, published 105th ILC session (2016)

Article 3(1) of the Convention. Pension scheme for seafarers. The Committee notes, with regard to the part of the pension paid by the defined benefit scheme, that the guaranteed replacement rate after 20 years is 60 per cent (3 per cent annual accrued rate), i.e. above the minimum accrued rate of 2 per cent established by Article 3(1)(a)(ii) of the Convention, even with the application of the reduction factor in the case of retirement at 60 years of age. Where the wage exceeds 500 balboas (PAB), it is, however, impossible to determine the pension’s replacement rate since that part of the pension is provided by the individual account system and is dependent on the return on investment. Noting that the Government soon intends to launch a process for the collection of information on the number of seafarers covered by the pension system, the Committee requests the Government also to collect and provide information on the average wages of seafarers affiliated to the system and also the average amounts of pensions paid by the system to insured persons who have made a total of 240 monthly contributions.

Article 3(2). Contribution of insured persons to the cost of pensions. The Committee notes that insured persons participate in the financing of pensions by means of contributions to the defined benefit scheme amounting to 9.25 per cent of the gross wage (for the first PAB500) and a premium of 8.16 per cent based on the remaining wage paid into an individual account within the defined benefit scheme. Employer contributions amount to 4.25 per cent of the gross wage in both schemes. Recalling that, under the terms of Article 3(2) of the Convention, seafarers collectively shall not contribute more than half the cost of the pensions payable under the scheme, the Committee requests the Government to indicate what proportion of the financing of pensions for the years covered by the report is constituted by the contributions paid by insured persons.

Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

Article 3(1) of the Convention. Pension scheme for seafarers. The Committee notes that Act No. 51 of 27 December 2005 revises the Organic Act establishing the Social Security Fund (CSS). It notes that the Act modifies key aspects of the retirement pension system in Panama, especially the following two points: first, the Act provides for transition from a defined benefit scheme to a mixed scheme which consists of different components based separately on defined benefits and capitalization and which includes a system of individual savings accounts. Second, in the context of the social insurance system, the retirement pension is paid at the normal rate from the age of 62 years for men and from the age of 57 years for women, subject to contributions having been made for at least 216 months (240 months from 1 January 2013). The normal replacement rate is 60 per cent of the basic monthly wage, to which a certain percentage may be added according to the number of years of contribution. The Committee also notes that insured persons may draw their retirement pension up to two years before the normal age, with a reduction factor of 0.8342. However, it is the Committee’s understanding that the age from which the normal pension rate is paid might be increased in the near future to 65 years for men.

The Committee recalls that the pension scheme for seafarers must comply with one of the following conditions: (a) the amount of retirement pension (including any other social security pension payable simultaneously to the pensioner) must not be less than the total obtained by computing for each year of his or her sea service 1.5 per cent of the remuneration on the basis of which contributions were paid in respect of him for that year if the scheme provides pensions on attaining the age of 55 years, or 2 per cent of such remuneration if the scheme provides pensions at the age of 60 years; or (b) the pensions provided by the scheme (including any other social security pension payable simultaneously to the pensioner and any social security benefits payable to the dependants of deceased pensioners) must be financed by premiums corresponding to not less than 10 per cent of the total remuneration used as the basis for the calculation of contributions.

In view of the fact that the major legislative reforms referred to above are likely to have an impact on the proper application of the Convention, the Committee requests the Government to supply detailed information, including statistics, enabling the Committee to assess whether seafarers enjoy, from 55 or 60 years of age, retirement pensions whose replacement rate meets at least the standards established by Article 3(1)(a) of the Convention. Moreover, inasmuch as the reforms undertaken appear, as in many other countries, to tend towards a gradual increase in the general retirement age, the Government is requested to indicate whether it is contemplating the introduction of a differentiated retirement age for certain occupations that are particularly arduous, especially seafaring. Furthermore, the Committee notes that section 153 of Act No. 51 of 27 December 2005 fixes the respective rates of contribution for employees and employers for the contingencies of invalidity, old age and death, without drawing a distinction between them. It requests the Government to indicate what proportion of these social contributions is allocated to the financing of old-age pensions so that the Committee can assess whether this rate meets the minimum requirements of Article 3(1)(b) of the Convention.

Part V of the report form. Application in practice. The Committee requests the Government to supply information on the application of the Convention in practice, including, for example, extracts from reports of the services entrusted with the application of the relevant legislation and, if possible, information on the number of seafarers covered by the defined benefit and mixed pension schemes, as established by Act No. 51 of 27 December 2005, and also on any difficulties encountered in the application of the Convention.

Direct Request (CEACR) - adopted 1991, published 78th ILC session (1991)

The Committee notes that the Government's report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request, which read as follows:

Article 3, paragraph 2, of the Convention. The Committee notes that under section 7 of Resolution No. 1348-J.D. of 14.4.1983 workers' contributions to the insurance scheme concerning old age, invalidity and death are 6.25 per cent of their monthly remuneration, whereas employers' contributions are 5.55 per cent. Since Article 3, paragraph 2, of the Convention provides that seafarers collectively shall not contribute more than half the cost of the pensions payable under the scheme, please state, in accordance with the report form, the amount of: (i) the contributions borne by the seafarers covered by the pension scheme; and (ii) the resources allocated to the pensions payable under that scheme. Please also show (i) as a percentage of (ii).