A BD4,000 ($10,600) cap on monthly pensions in Bahrain could soon be abolished under a Shura Council proposal.

The council-drafted proposal was unanimously approved yesterday and backed by the government, which acknowledged the current bill was unfair and meant high-ranking officials were being prevented from receiving their dues.

A Pension Fund Commission representative told Shura Council that there was a problem with an article in the 2006 Pension Law, which imposes the cap.

"We have several cases that are being affected by this cap and abolishing it has been a plan with us for some time because it is unfair and means that a number of workers contribute more to pension funds, while receiving less than they give," he said.

Councillor Mohammed Al Musalam said the pension cap penalised hard-working employees who succeed in the public or private sector.

"There are people who work from scratch to become chief executives or senior managers and this means that their wages reach up to BD10,000, but when they retire and instead of getting 80 per cent of their due rights as pensions, they only get BD4,000," he said.

"This means that their lives during retirement get hugely affected considering that the difference is around half of what they should be getting.

"The article was inserted by the government as a precaution in 2006 to ensure no meddling with wages, allowing those about to retire to get more than they deserve. But things have changed and now everything is done through a sequenced computerised system."

Councillor Lulwa Al Awadhi said that everyone should be getting pensions in line with their contributions.

"For example, if someone's wage is BD10,000 then their contributions are around BD600 a month and in the end they are getting a pension same as someone who is contributing BD200, this is unfair," she said.

"Everyone has to get his due pension without this cap, which is one of the most unjust pieces of legislation I have ever seen." – TradeArabia News Service