Employers who attempt to flout the law by refusing to make pension payments on behalf of their employees face prosecution through the Debt Enforcement Unit, the Ministry of Finance declared yesterday.

The Ministry is attempting to enforce stringent legislation that makes it a legal obligation for employers to make timely payments to the Contributory Pension Fund.

In a Press release the Ministry said the issue was an ongoing concern for Government.

?The current Government has placed a high priority on collecting outstanding Contributory Pension Fund contributions,? the release said. ?Overall the majority of employers pay their pension contributions on a timely basis but failure by many employers to remit their pension contributions on a timely basis has been an ongoing concern to Government for some time.

?Paying social insurance contributions is not a voluntary choice. It is a legal obligation. When employers fail to remit pension contributions collected from their employees they are in effect depriving them of their future pension.

?This behaviour is also unfair to individuals and companies that do pay their pension contributions on a timely basis and is not tolerated by the current Government.?

The Government said it has made concerted efforts to encourage and require employers to make their required pension contributions.

However, it should be noted that when companies are wound-up the Department of Social Insurance continues to attempt to collect outstanding pension contributions owed by the company.

?It is not a soft option to wind-up in order to avoid settling outstanding pension contributions owing to the Contributory Pension Fund,? states the release.

The Department of Social Insurance is responsible for collecting contributions, and according to Government it has introduced various initiatives to improve the debt collection process with four Inspectors and a Compliance Officer who work to monitor the status of contribution payments due to the Contributory Pension Fund.

The Ministry said businesses are asked to produce a current statement or a letter from the Department of Social Insurance to the Transport Control Department before their commercial vehicle licences are issued or renewed.

Businesses are also asked to produce a current statement or a letter from the Department of Social Insurance to the Department of Immigration before work permits are issued or renewed.

In the Press release, Government also said all departments have been advised that before entering in any contract for Government business the Tax Commissioner?s Office and Department of Social Insurance should be consulted to ensure that the successful company is not delinquent in pension contributions or other taxes.

The policy has been included in the revised Financial Instructions issued by the Accountant General in early 2005, said Government.

The Department of Social Insurance, under the direction of the Ministry of Finance, has recently embarked on a PR and awareness campaign to inform and educate the public regarding their responsibilities in contributing to the Contributory Pension Fund.