RIYADH — The number of retired citizens and military personnel is expected to exceed a million by the year 2022, according to former Shoura Council member Sulaiman Al-Hameed.
The government may need to spend SR116 billion in pensions, he said.
The number of retired citizens and military personnel in 2002 was only 301,000. It doubled to 618,000 by 2012 with an increase of 10.5 percent a year.
Similarly, pension funds increased from SR17 billion in 2002 to SR45 billion in 2012 with an increase of 16.5 percent a year, said Al-Hameed.
By this rate the number of retired citizens and military personnel is expected to reach 1.17 million by 2022 with an increase of 7.6 percent a year. Likewise, pension funds are expected to reach SR116 billion with an increase of 13.7 percent a year.
The new amendments to the pension law did not have a clear plan to cover the increased expenses, said Al-Hameed.
He urged the pertinent authorities to address the expected deficit to avoid a reduction in the pension fund.
“I am proposing a savings account for pensioners where money is invested to cover the expected pension fund deficit,” he said, adding, “I submitted a proposal to the Shoura Council, which agreed to look into it and conduct an extensive study.”
Source Credit: Saudi Gazette