Pension funds provide for the retired class. Egypt's social security system covers around 25 million members and is administered by the National Organization for Social Insurance (NOSI).

Old-Age Benefits

Who is Eligible?

There are two separate funds. One fund covers government workers (civil servants, armed forces, police force) and the other workers in the public and private enterprises, some self-employed, casual workers and Egyptians working abroad.

People are eligible for pensions at age 60 with at least 120 months of contributions. However, there is a new law raising that age to 65 for workers entering the workforce in 2012.

Early base pension: The base pension is reduced according to insured's age at the date of claim for the pension. The reduction is 15 percent if younger than 45 years old. It is reduced 10 percent if younger than 50 years old. It is only reduce 5 percent if younger than 55 years old. There is no reduction if over 55 years old.

Benefits

Base pension: Up to 1/45 (1/40 for arduous work or 1/36 for dangerous work) of the reference base earnings is paid for each year of contributions, up to a maximum of 36 years. The reference base earnings are equal to average monthly base earnings in the last 2 years or average monthly base earnings, increased by 40 percent in the 5 years before the last 2 years (whichever is lower). Base earnings are earnings up to 700 LE a month.

Base pension special increment: 25 percent of the base pension is paid, up to a maximum of 35 pounds. The minimum increment is 20 LE.

Contributions

Insured people contribute 10 percent of their monthly earnings, plus 3 percent of base monthly earnings for lump-sum benefits.
The minimum monthly earnings for contribution and benefit purposes are equal to the lower limit of the civil servant salary scale.
Base earnings are earnings up to 700 pounds a month. Variable earnings are earnings exceeding 700 pounds a month, plus certain other forms of compensation, including bonuses, incentives, commissions, and profit shares.

Self-employed people contribute 15 percent of declared monthly income.

Employers contribute 15 percent of covered monthly payroll, plus 2 percent of base monthly payroll for lump-sum benefits.

Government contributes 1 percent of covered monthly payroll.

Company Plans

Company pension funds are available from many of the international companies operating in Egypt. They usually allow employees to pay into a company led plan with individual benefits. These are often independent of country and can be contributed to and withdrawn from all over the world.

Contributions

Contributions are usually made by both the employee and employer in terms defined by the plan. As each plans terms are dictated by the individual plan, inspect their guidelines carefully.

Both employee and regular employer contributions are tax deductible. Special employer contributions above the normal annual contribution are also tax deductible.

Who Qualifies?

Generally, people are able to draw upon their plans at age 60. Pensions are calculated as a percentage of your accumulated credit, which is made up of contributions and interest. It is possible to draw a pension before reaching retirement age if the regulations of the pension fund allow this.

Benefits

Benefits of plans are dependent on the terms set out in the individual plan.

Private Pension

Private pensions are an option for anyone not qualifying for a national pension or eligible for a company pension. There are a wide range of private pension funds. Many are provided by the banks, but others operate independently.

Private pensions generally take on two possible forms :
• Individual Pension
• Collective Pension (divided into Associative and Company Schemes

Contributions

There is usually a minimum monthly payment. It is also possible to continue to contribute to a personal pension plan abroad or to an offshore fund. Contributions to foreign pension schemes aren't tax deductible in Spain so all benefits paid are tax free.

Benefits

The amount of pension paid depends on the chosen type of policy. There is a maximum amount of contributions that are deductible from income. This depends on salary and contributions to other insurance schemes.