Three reasons why the UAE should set up investment funds to help expats manage retirement
The country's end-of-service benefits system needs improvement.
It is not currently mandatory for UAE companies to set aside payment for end-of-service gratuity Retaining talent: At the first Workers Incentives and End of Service Benefits Conference in Dubai, Dr Abdul Rahman Abdul Manan Al Awar said authorities are conducting studies to improve the end-of-service benefits system, particularly as the age of retirement has increased. The new system will also help retain talent in the UAE and will possibly include an enhanced gratuity system and private sector savings scheme which will help keep skilled labour in the Gulf country. Higher retirement age: Accelerated global technological advancements and an increased retirement age and years of service mean there is an urgent need in the region to establish investment funds to manage retirement and end-of-service benefits. It is not currently mandatory for companies in the UAE to set aside payment for end-of-service gratuity. It is calculated as 21 days of pay per year of service for five years of service, and 30 days of pay per year of service thereafter. Saving opportunity: The funds would provide a savings opportunity to employees in the UAE. They will help them set up proper plans by taking advantage of end-of-service benefits and making use of their financial resources, as well as creating jobs for new generations. A fifth of UAE companies face end-of-service liabilities of over $15m, with 88 percent of GCC companies surveyed having no plan to fund gratuities due, according to 2018 survey by advisory Willis Towers Watson.