Abu Dhabi Raises Minimum Retirement Age to 55, Unveils Pension Changes

To make the retirement system in the emirate more equitable for workers in both the public and private sectors, the Abu Dhabi Retirement Fund has proposed changes to the Retirement Law.

Read also: UAE: New Federal Decree Law on Pensions for Employees and new national workers

Abu Dhabi Retirement Fund Enhances Retirement System for Citizens

The changes also aim to establish a modern and flexible retirement system that aligns with the functional and social needs of the insured, providing the opportunity for better retirement benefits for those continuing to work beyond the minimum years of service required for retirement.

Key Amendments:

1. Increased Retirement Pension:

  • The maximum percentage of the retirement pension has been raised to 100% of the salary, achievable upon completing the maximum years of service.
  • Insured individuals can receive a retirement pension equal to 80% of the salary upon completing the minimum years of service (25 years).
  • The percentage can be increased annually by 2% for each additional year of service until reaching 100% of the salary.

2. Unified Calculation Method:

  • The retirement pension calculation method has been unified for all insured individuals, whether in the government or private sector.
  • The pension is calculated based on the average salary subject to deduction for the last six years.

3. Retirement Contributions:

  • The percentage of retirement contributions remains at 26% of the salary subject to deduction, with new insured individuals bearing 11%, and employers bearing 15%.

4. Minimum Retirement Age:

  • The minimum retirement age in the first year of application is set at 45 years, with 25 years of completed service.
  • The age increases gradually by six months every year until it reaches 55 years.

5. Privileges for Women with Children:

  • Women with children are granted privileges allowing them to benefit from the early retirement system.
  • An optional subscription system is introduced for women wishing to leave work to focus on their families, enabling them to continue paying retirement contributions during the sabbatical period.

6. Combining Retirement Pension and Salary:

  • The amendments allow for the combination of the retirement pension and salary after completing the maximum years of service or reaching the retirement age.

7. Transitional Phase:

  • The amendments will be implemented gradually over the coming years to ensure a smooth transition, emphasizing the preservation of acquired rights.

Statements from Officials:

The Abu Dhabi Retirement Fund's Managing Director, Salem Rashid Al Nuaimi, highlighted that the adjustments to the retirement system in the Emirate of Abu Dhabi play a crucial role in elevating the living standards of registered citizens.

Al Nuaimi emphasized the continuous evaluation and revision of the retirement system to safeguard citizens' rights and ensure their long-term well-being, given the fund's integral role in the emirate's social services structure.

Additionally, he expressed a commitment to supporting the emirate's initiatives, aiming to design flexible and contemporary systems aligned with the evolving needs of successive generations and societal and economic advancements. Al Nuaimi underscored the importance of a gradual transitional phase for implementing law amendments, emphasizing the preservation of acquired rights under the previous system.

Khalaf Al-Hammadi, the Fund’s Director General for Retirement Affairs, emphasized that the flexibility and adaptability of legislation reflect the maturity of governments. He highlighted the retirement system's significance in regulating citizens' functional and social aspects, noting ongoing efforts to amend the system in line with the UAE's legislative approach.

Al-Hammadi stressed that the amendments introduce new features, such as the possibility for insured individuals to receive 100% of their salary subject to deduction as a retirement pension, bridging the income gap before and after retirement. Importantly, he assured that the amendments would not compromise the acquired rights of the insured under the previous law, ensuring their retention.

In conclusion, Al-Hammadi highlighted the gradual implementation of the amendments over the coming years.

The Abu Dhabi Retirement Fund is dedicated to preserving citizens' rights and securing their future, contributing to the overall social services system in the emirate.

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