How does FNPF work for Pensioners?

How does FNPF work for Pensioners/Annuitants?

 

FNPF’s primary role is to provide a secure future for its members by ensuring that they have a meaningful retirement from their hard-earned savings accumulated during their working life.

The new FNPF law, which came into effect on 25 November 2011 safeguards our role and ensures the Fund remains sustainable in the long term through the introduction of actuarially-fair rates for its current and future pensioners.

On 01 March 2012, the Funds new Pension Scheme was introduced.

FNPF has two pension products, apart from the Lump Sum option. They are:

(i) Life Pension and
(ii) Term Annuity.

Retirement Income Fund

Pensions and annuities are provided from the Retirement Income Fund (RIF), a separate fund within the FNPF, established to provide life pensions and term annuities.

The amount set aside by a member for his pension is paid into the RIF, and the pension is paid out of the RIF. The RIF is supported by the investment earnings on its assets, less expenses attributable to its management.

Solvency Requirement

A solvency reserve is held within the RIF to ensure that the Fund is able to meet pension payments in all reasonably foreseeable circumstances. The ability of RIF to meet pension payments is monitored by the Reserve Bank of Fiji (RBF). RBF sets standards and obtains regular reports on the RIF from the FNPF.  These reports include a Financial Condition Report signed off by the FNPF actuary.