BREAKING NEWS: NIC’s Economic Relief Programme extended for 3 more months

Prime Minister Allen Chastanet has announced that the Economic Relief Programme (ERP) of the National Insurance Corporation (NIC) will be extended for three more months until September 30. In a statement on his Facebook page, the prime minister acknowledged that there have been some challenges with the ERP but assured the public that the government and the NIC is committed to ensuring the issues are resolved, so they can continue to provide relief to Saint Lucians in these unprecedented times.

Chastanet noted that the ERP was established to help NIC contributors who are negatively impacted by the COVID-19 pandemic. Over the last three months, he said, many businesses have closed and thousands of persons laid off. Other individuals have also suffered significant loss of income.

The programme provides for the payment of a monthly sum equivalent to fifty percent (50%) of the insurable earnings of an affected insured person subject to a minimum of Five Hundred Dollars ($500.00) and a maximum of One Thousand Five Hundred ($1,500.00) for a period of up to three (3) months, in the first instance i.e. April to June 2020. These amounts are subject to deductions for financial assistance or any income received from the employer.

The prime minister stated:

“While the programme was for an initial period of three months, it was always the intention of the NIC to consider extending the programme once the qualifying conditions were met. The National Insurance Board considered the ongoing adverse impact of the COVID-19 pandemic on the business sector including the hotel sector which employs a significant percentage of its contributors. Having satisfied itself that a sufficiently large number of its contributors would require some relief over the next three month, the NIC examined the affordability of the programme.

It would be recalled that the NIC’s decision to implement such a programme was rooted in sound financial and actuarial analysis and foremost in the mind of the Corporation was the need to ensure that the long term financial sustainability of the NIC was not compromised. It would also be recalled that the NIC considered a number of scenarios and that the worst-case scenario for a 3-month period, if claims were received from 60% of contributors, was $80.2 million.

I am pleased inform you that the NIC has reported that the overall cost for a 6 months programme will remain within the cost originally forecasted as the worst case scenario for the initial 3 months. What this means is that with a 3 month extension, the depletion of the Fund will not exceed the seven months previously reported by the NIC. Given those two key factors – the business impact and the cost of the programme – and taking into account its mandate to provide income support to its contributors, the Board of the NIC decided to extend the Economic Relief Programme by three months to September 2020.

As a government we are pleased to support this extension and the requisite regulations have been enacted to give effect to it and provide some kind of relief for Saint Lucians.