In March 2021, Cambodia introduced Sub-Decree 32 which implements a new pension scheme in the country. Before Sub-Decree 32, only the schemes related to occupational risks and health care were applied.
Under the current social security system, employers with one or more employees must register, as well as their employees, with the National Social Security Fund (NSSF) within 30 days of opening. The NSSF offers three regimes:
Occupational risk insurance – industrial accidents;
Health care insurance; and
The NSSF first set up the occupational risk insurance scheme in 2008, then health insurance in 2016. In 2019, the government introduced the social security scheme, but its implementation was suspended. .
Sub-decree 32 introduces the mechanism and procedures, the contribution rate and the claim for benefits for the four types of pension schemes provided for by the decree. These are:
Old age pension;
Survivor’s pension; and
What are the eligibility conditions?
Old age pension
To be eligible, the NSSF member must be enrolled in the pension scheme, be at least 60 years old and have contributed to the pension fund for at least 12 months.
To be eligible, the NSSF member must be enrolled in the pension scheme and have contributed to the pension fund for at least 60 months before becoming disabled.
Benefits are paid to family members in the event of the death of a CNSS member who has contributed to the pension fund for at least 60 months.
The allowance is only paid in the event of the death of a person entitled to old age or invalidity pension.
Sub-decree 32 states that companies that are not registered with the NSSF must do so within 30 days of the date the decree enters into force and that their employees must also be registered within three days of the decree. the start of employment.
What are the components of the pension plan?
The pension plan is made up of two components:
Under the compulsory scheme, the contribution rate will be borne at 50 percent by the employer and the remaining 50 percent by the employee.
Contribution rates will be in three states, as follows:
1st stage – four percent of the contributory salary (salary before tax deductions) to which the employer will contribute two percent and each employee two. This will be implemented during the first five years of the regime;
Step 2 – eight percent of contributory wages, the employer contributing four percent and each employee four. This will be implemented after the first stage is completed and for five years; and
Step 3 – there will be subsequent increases of 2.75 percent every ten years.
Employers are required to pay their pension contributions to the NSSF by the 15th of the following month, and the assessment report – which includes the number of employees – must be submitted by the 20th of the following month.
The voluntary scheme
Members of the NSSF may also apply to participate voluntarily in the pension scheme if they meet the following conditions:
The applicant is under 60 and unemployed, but is still able to pay the pension;
The applicant is under 60 and wishes to pay the monthly contribution to receive an old-age pension much higher than the amount he receives under the compulsory pension scheme; Where
Have income above the salary cap.
The contribution rate under the voluntary scheme must be equal to or higher than that paid under the compulsory pension scheme. ASEAN Briefing.