Dubai launches savings scheme for expat employees; all you need to know

Abu Dhabi: Dubai government on Wednesday announced the launch of a new savings scheme for expatriate employees working in the public sector, the Dubai Media Office (DMO) reported.

The scheme could be expanded to the private sector but on a voluntary basis only. The savings scheme, the first of its kind in the region, aims to provide government employees an opportunity to enhance their savings and end-of-service dues.

Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of the Executive Council announced the scheme following an Executive Council meeting.

“Today I approved the ‘Savings Scheme for Foreign Employees in the Govt of Dubai’ at a @TECofDubai meeting. The first of its kind in the region, the Scheme will enhance govt staff’s end-of-service benefits. We are looking at extending the Scheme to private-sector employees as well https://t.co/m9O1SKywCn,” Hamdan tweeted.

Employees will be offered multiple investment plans, including those that are Shariah-compliant. Employees who do not wish to invest their benefits will also be provided with options that ensure capital protection.

The scheme will ensure that all government employees and their families are provided with opportunities for growth and high quality of life, throughout their careers and at the end of their service.

The scheme will be overseen by the Dubai International Financial Center (DIFC) in partnership with several international investment firms that provide attractive and safe investment opportunities.

Objectives of the scheme

• Ensure and protect the rights of employees and provide them with opportunities to develop their savings and end-of-service dues.

• Attract the best talent and enhance the flexibility and attractiveness of the labour market in Dubai similar to other leading nations.

• Drive financial literacy and foster a culture of saving among employees to assist in creating a financial plan that serves their future.

Here are the key highlights of the scheme

• The scheme is the first of its kind in the region and follows international best practices. The initiative will enhance end-of-service indemnities in the Government of Dubai.

• Provide a series of investment mechanisms in line with employees’ preferences, including the provisions of Islamic Sharia, with a guarantee of capital protection for employees who do not wish to invest.

• Deposit financial dues starting from the date of plan enrolment.

• Study the extent to which this system can be voluntarily applied to private-sector employees in Dubai, following coordination with relevant federal and local entities.

• The savings scheme is managed by a board of trustees and international investment institutions, under the supervision of the Dubai International Financial Centre.

New committee

Following the launch, Sheikh Hamdan directed the formation of a steering committee headed by the General Secretariat of The Executive Council.

Members of the committee include

• Department of Finance

• Dubai Government Human Resources Department

• Government of Dubai Legal Affairs Department

• Supreme Legislation Committee

• Dubai International Financial Centre

The committee will draw up an action plan, establish operational procedures, supervise the progress of the scheme’s work and achieve its objectives.