Social Security Programs Throughout the World: Asia and the Pacific, 2006

 

Brunei

Exchange rate: US$1.00 equals 1.57 Brunei dollars (B$).

Old Age, Disability, and Survivors

Regulatory Framework

First and current laws: 1955 (old-age and disability pensions), with 1984 (universal pension) amendment; and 1992 (employees' trust fund).

Type of program: Provident fund and universal old-age and disability pension system.

Coverage

Provident fund: All employees up to age 55 who are citizens or residing permanently in Brunei, including government civil servants who began service on or after January 1, 1993. (Civil servants who began service before January 1, 1993, are covered by the government pension scheme.)

Voluntary coverage for self-employed persons and persons aged 55 or older.

Exclusions: Foreign workers.

Special systems for armed forces personnel, police force personnel, and prison wardens.

Universal old-age and disability pension: All persons residing in Brunei.

Source of Funds

Insured person

Provident fund: 5% of monthly earnings if monthly earnings exceed B$80. (Additional voluntary contributions are permitted with prior notification given to the employer.)

There are no minimum or maximum earnings for contribution purposes.

Universal old-age and disability pension: None.

Self-employed person

Provident fund: Voluntary contributions only.

There are no minimum or maximum declared earnings for contribution purposes.

Universal old-age and disability pension: None.

Employer

Provident fund: 5% of monthly payroll. (Additional voluntary contributions on behalf of employees are permitted.)

There are no minimum or maximum earnings for contribution purposes.

Universal old-age pension: None.

Government

Provident fund: None.

Universal old-age and disability pension: The total cost.

Qualifying Conditions

Old-age benefit

Provident fund: Age 55. Retirement is not necessary.

Early withdrawal: Age 50.

Drawdown payment: Fund members with at least B$40,000 in their individual account or who have been provident fund members for at least 10 years can draw down funds from their account for building or purchasing a house for their personal residence.

A lump sum is payable to members of any age if emigrating permanently from the country.

Universal old-age pension: Age 60 and residing in Brunei. Persons born in Brunei must have 10 years of residence immediately before claiming the pension; for persons born outside Brunei, 30 years of residence immediately before claiming the pension.

Disability benefit

Provident fund: The fund member must be unable to work as the result of a physical or mental disability. The degree of disability is assessed by the Medical Board.

Universal disability pension: Must be unable to work and have resided in Brunei in the 10 years immediately before the disability began. Must participate in suitable medical treatment and rehabilitation.

Survivor benefit (provident fund): Paid to the next of kin or named survivors.

Old-Age Benefits

Old-age benefit (provident fund): A lump sum is paid equal to total employee and employer contributions plus compound interest.

Early withdrawal: Fund members may draw down 25% of accumulated assets.

Drawdown payment: The fund member may draw down up to 45% of accumulated assets in the individual account only once before age 55 for building or purchasing a house.

Interest rate adjustment: Set by the government annually according to the financial health of the fund, bank saving rates, and inflation rates. The current rate is 4.25%.

Universal old-age pension: A flat-rate amount is paid.

Benefit adjustment: The pension is adjusted on an ad hoc basis.

Permanent Disability Benefits

Disability benefit (provident fund): A lump sum is paid equal to total employee and employer contributions plus compound interest.

Interest rate adjustment: Set by the government annually according to the financial health of the fund, bank saving rates, and inflation rates. The current rate is 4.25%.

Universal disability pension: A flat-rate amount is paid.

Benefit adjustment: The pension is adjusted on an ad hoc basis.

Survivor Benefits

Survivor benefit (provident fund): A lump sum is paid equal to total employee and employer contributions plus compound interest.

Interest rate adjustment: Set by the government annually according to the financial health of the fund, bank saving rates, and inflation rates. The current rate is 4.25%.

Administrative Organization

Under the supervision of the Employees' Trust Fund Board, the Employees' Trust Fund Department (http://www.tap.gov.bn/) of the Ministry of Finance is responsible for the administration of contributions and benefits and the investment of funds.

Department of Community Development of the Ministry of Culture, Youth, and Sports administers the universal benefit program.

Sickness and Maternity

Regulatory Framework

The government provides all persons residing in Brunei with access to medical benefits, including outpatient and inpatient care provided by registered physicians and, upon referral by the physician, in approved hospitals. The Ministry of Health registers physicians and approves hospitals to provide services to residents.

Work Injury

Regulatory Framework

First and current law: 1957 (workmen's compensation), with 1984 amendment.

Type of program: Employer-liability system.

Coverage

All employees who are citizens or who reside permanently in Brunei, including government civil servants.

Exclusions: Domestic servants, home workers, and security personnel.

There is no voluntary coverage.

Source of Funds

Insured person: None.

Self-employed person: Not applicable.

Employer: The total cost, met through the direct provision of benefits.

Government: None.

Qualifying Conditions

Work injury benefits: There is no minimum qualifying period.

Temporary Disability Benefits

A monthly benefit is paid equal to 2/3 of the employee's average monthly earnings in the 6 months before the disability began.

The maximum monthly benefit is B$130.

The benefit is paid after a 4-day waiting period for up to 5 years. If the disability lasts more than 14 days, the benefit is paid retroactively for the first 4 days.

Permanent Disability Benefits

A lump sum is paid equal to 48 times the employee's average monthly earnings in the 6 months before disability began.

The maximum benefit is B$9,600.

Constant-attendance supplement (total permanent disability): If the insured requires the constant attendance of others to complete daily tasks, a lump sum is paid equal to 25% of the total permanent disability benefit.

Partial disability: A lump sum is paid equal to the total permanent disability benefit times the assessed percentage of disability, according to a schedule.

If temporary disability benefits were paid for a period exceeding 6 months before the determination of total or partial permanent disability, the temporary disability benefits paid after the duration of 6 months are deducted from the permanent disability benefit.

Workers' Medical Benefits

The employer must pay for the examination and treatment of the insured by a registered physician and, upon referral by the physician, in approved hospitals.

Survivor Benefits

A lump sum is paid equal to 36 times the insured's average monthly earnings in the last 6 months before death.

The maximum benefit is B$7,200.

Eligible survivors are dependent members of the deceased's family (including the spouse, children, parents, and brothers and sisters).

In the absence of eligible survivors, the employer must pay for the insured's funeral.

Administrative Organization

Workmen's Compensation, Health and Safety Section, of the Department of Labor enforces the law. The Department of Labor is part of the Ministry of Home Affairs.

Individual employers must pay compensation directly to employees or dependent survivors.

An arbitrator settles disputes regarding the determination and provision of benefits.