The Overseas Pakistanis Foundation (OPF) has reactivated pension scheme for Pakistani citizens living abroad. There are around 7 million overseas Pakistanis all over the world. Greater part of them, particularly those working in Middle East, do not have the benefit of any social security cover either in the country of employment or at home. The need for such a cover is greatly felt in old age or serious disability in case of death of a salary earner. Therefore, in order to fulfill their needs and to ensure a secured future of Pakistanis living abroad and their families, the Overseas Pakistanis Foundation (OPF) launched a self-contributory and voluntary pension scheme in July 2001. But unfortunately it could not take off due to various administrative bottlenecks. The Managing Director of OPF, Syed Nayyar Hasnain Haider, who is also Chairman of Overseas Pakistanis Pension Trust (OPPT), after assuming his office in June 2007, accorded top priority to review and reactivate the scheme. The scheme is being managed by overseas Pakistanis Pension Trust (OPPT) which is a subordinate of OPF. Overseas Pakistanis who are living abroad and are registered with OPF as members can subscribe to the pension scheme. Unregistered overseas Pakistanis can obtain membership by filling the OPF membership form and sending the prescribed fee of Rs1,050 to OPF to be eligible to apply for the pension scheme. One who wishes to subscribe has to select a suitable plan from the available options and fill the application form, nomination form, list of dependants and Cz-50 Zakat declaration form, attach two photographs and a copy of OPF membership card to indicate its membership and send it to OPPT in Islamabad. Subscriber should not enclose any money. After receipt of the complete application and its scrutiny, OPPT will advise the exact US dollar amount to be remitted for subscriber's selected plan including the registration fee chargeable in US dollars 25 along with detailed procedure of safe and inexpensive remittance. Pension scheme have the flexible plans. The contributions are being credited to subscriber's plan account maintained by the Overseas Pakistanis Pension Trust. Before the cash stream pension starts, the balance in subscriber's plan is built up year by year out of his contributions, plus investment income credits minus charges. As the cash stream pension starts, the balance in subscriber's plan would continue to get investment income and this would be paid monthly as pensions and it would be debited to each member's plan account. In this way the fund balance in subscriber's pension account with OPPT at the time of maturity will remain intact and safe. Subscriber may terminate his pension plan with OPPT any time after the first year at his option. He would be refunded the total contribution including profit, after deduction of service charges and pre-paid insurance premium. There is an annual increase in pension and principal amount. There is also an option for premature encashment and option of 50% encashment on maturity. This way is correspondingly reducing the amount of pension payment. It is not an age-based, but a time- based scheme. Various pension packages have been finalized by actuaries offering 5, 10, and 15 years plans with option of lump sum and annual payments as well. Minimum contribution has been fixed at Rs24,000 installment for the annual payment plan and Rs120,000 for the lump sum payment plan. Each applicant has the option to decide how much to contribute. There is no maximum limit and perimeter of contribution for both plans but additional amount must be in multiples of minimum. All contributions are payable in US dollars at prevailing exchange rate. However, if the member returns to Pakistan permanently, then balance payment can be made in Pakistani rupees as well. Payments are also permissible from certified remittances. On maturity of the plan, pension can be paid through a bank nearest to the subscriber's home in Pakistan. In case of subscriber's demise, the payments of pension can continue to the nominee and then to the children, till the youngest child turns 18 years of age, when pension would be stopped and the deposited amount with accumulated profits given to the legal heirs. Continuity of contribution is covered by insurance in case of accidental total disability or death without medical checkup of a subscriber. A subscriber may opt for any number of units at a time. However, the insurance coverage is limited to a maximum of three units. Pension payments are made in Pakistani rupees. Unit is term defined as if subscribers choose lump sum contribution option, a unit is equal to a lump sum contribution of Rs120,000 whereas, if the subscriber chooses annual contribution option, a unit is equal to yearly contribution of Rs24,000. The units are defined as the minimum amounts while there is no maximum limit. A subscriber can choose any number of units of a plan or combination of plans. Husband and wife can separately subscribe to pension scheme, if residing overseas. There is no provision of joint policy in the pension scheme. However, a spouse, if nominated, as beneficiary in case of death of a subscriber would draw the benefits as official nominee. Any person can be nominated as subscriber's nominee and he can change his nominee at any point of time. There has to be one nominee for each plan. One can apply for OPF Pension Scheme irrespective of the fact that the member is participating in any other similar scheme. OPPT arranges an insurance coverage from the State Life Insurance Corporation of Pakistan to ensure immediate payment of pension in case of serious disability or death caused by an accident of a subscriber. Under this arrangement every subscriber who is below the age of 55 years at the time of joining the scheme would be covered. In case of any eventuality the disabled member or his family will immediately start receiving monthly pension at 60% of the amount payable on maturity, without any further contributions from the subscriber or his family. After maturity date pension's payment is continue at 100% rate. According to an official report of OPPT, the payment of pension to matured cases was started immediately and all cases matured up to February 2008 have been paid their monthly pension dues. OPF has also revised its investment policy and funds which were lying idle with banks have been invested in ‘high yield low risk' ventures in the capital market and mutual funds etc. The efficient management of OPPT funds has yielded a return of over 18%, against the target of 14%. The expected pension payment on maturity ranges from Rupees 1,541 per month to Rupees 6, 689 per month on minimum contributions. The Community Welfare Wing is responsible for handling Pension Scheme. However, expatriates in the Kingdom still do not show interest in subscribing to this pension scheme. “It is a pity that none of our Pakistani people have come to us to subscribe to the pension scheme since it was launched in 2001,” said a source at Pakistani Consulate General in Jeddah. “I feel that Pakistani expatriates do not have information about this scheme,” said the source At the Jeddah consulate, welfare counselor Dr. Nawaz and Shoukat Ali are the contact officers for this scheme. Previous year, OPF team along with MD of OPF and chairman Syed Hasnain Haider visited Jeddah on Pakistan Catalogue Show and presented detailed lectures to create awareness about OPPT scheme. Some expatriates, however, expressed doubt over the scheme. “We do not trust that our money would go to a safe place, and we can get real benefit from the scheme,” said Anwar Khan, an accountant. Since OPF has rightly or wrongly become infamous as a useless institution, we want surety that our hard-earned money would be safe, he said. Sardar Amil Khansahab, a sales manager, also expressed the same concerns. “First of all we do not have any information about the pension scheme. Secondly, I am afraid that when the government changes, as it happens always, the rules of this scheme may also change. In that case, it is possible that our money would be frozen,” said Khansahab, stressing that the pension scheme should be instituted in a proper way with security and transparency. Contrary to these apprehensions, an economics teacher, Bilal Raza, believes that the pension scheme has been launched and managed by Overseas Pakistanis Pension Trust. While it is registered as a trust which is an on-going entity, it will not be affected by the change of government. Moreover, OPPT is a subsidiary of OPF which was established in 1979 and it can be a reason for its guarantee. He also rejected the concerns about the depreciation of Pakistan rupee as a reason to keep away from the scheme. “Pakistani rupee is now stable,” said Raza. “Past experience shows that the depreciation of the Pakistani rupee has usually been offset and balanced by the higher rates of return. In fact, those who have US dollars have earned less as compared to those who held Pakistani rupees and took advantage of the higher returns,” he added. This is good news for expatriates that OPPT scheme is launched and revived at a large scale to mobilize the overseas Pakistanis to subscribe to the policies according to their requirements. There are so many other investment avenues available in Pakistan. But OPPT can be a better choice for expatriates to invest their savings because beside giving a reasonably higher rate of return, the OPPT is the only organization which provide security of the capital invested. The scheme is a sound source of income to those Pakistanis who would go home permanently. But there is a need to create awareness and win the trust of expatriates regarding such a beneficial scheme. __
