The single biggest structural reform in the Budget 2026–2027 is to pensions. It replaces the universal Basic Retirement Pension (BRP) with a means-tested State Age Pension (SAP), and overhauls the contributory system by replacing the National Pension Fund (NPF) with the National Pension and Provident Fund (NPPF). This affects every retiree and every employer in Mauritius.
This guide explains both reforms in plain English.
From BRP to State Age Pension (SAP)
A new pension system, the State Age Pension (SAP), replaces the Basic Retirement Pension from 1 January 2027. The key shift is that SAP is means-tested — it is designed to direct support to lower-income earners.
- Full SAP is paid where monthly income does not exceed Rs 14,000 (the World Bank relative poverty line of 50% of median income).
- Above that, SAP tapers through an adjustment mechanism and phases out at a monthly income of Rs 50,000.
- A minimum de minimis SAP of Rs 1,000 applies up to the income ceiling.
Flexible drawing age
Under the new system an eligible person can elect to receive the SAP from any month they attain age 60 up to age 70, with the option irrevocable:
| Choice | Effect on SAP |
|---|---|
| Draw before 65 | Reduced by 0.5% per month early (6% per year) |
| Draw at 65 | Standard amount |
| Postpone after 65 | Increased by 0.75% per month (9% per year), up to age 70 |
The Government noted that, of the 263,200 currently eligible pensioners, over 90% will still benefit from the SAP, including over 75% who will receive the full pension.
From NPF to the NPPF
The contributory tier is also reformed. From 1 July 2027, the social contributions (CSG) and the Portable Retirement Gratuity Fund cease and are replaced by contributions to a new National Pension and Provident Fund (NPPF), operating on a defined-contribution basis with individual member accounts.
New contribution rates
| Employee earnings | Employee contribution | Employer contribution |
|---|---|---|
| Up to Rs 50,000 per month | 1.5% of basic salary | 7.5% |
| Above Rs 50,000 (up to 8× median earnings, currently Rs 225,000) | 3.0% | 10.5% |
Contributions are credited to individual member accounts, and the fund pays out a monthly pension plus an optional lump sum at retirement. Rates will be reviewed periodically with the aim of targeting a pre-retirement salary replacement ratio of 40–50%.
What employers must do
The NPPF changes your payroll from July 2027. You should:
- Plan for the new employer contribution rates (7.5% / 10.5%).
- Update payroll systems for the two earnings bands.
- Communicate the change from CSG/PRGF to NPPF to your staff.
For wider workforce changes in the same budget, see our employer HR changes guide.
Getting advice
Pension reform interacts with payroll, tax and HR. Our accounting service and the directory of verified accountants and lawyers can help you prepare. For the full set of measures, see the Budget 2026–2027 business guide.
Frequently Asked Questions
What is the State Age Pension in Mauritius?
The State Age Pension (SAP) is the means-tested replacement for the Basic Retirement Pension, effective 1 January 2027. Full SAP is paid where monthly income is below Rs 14,000 and it tapers to nil above Rs 50,000.
At what age can I draw the State Age Pension?
You can elect to draw the SAP from any month between ages 60 and 70. Drawing before 65 reduces it by 0.5% per month (6% per year), while postponing after 65 increases it by 0.75% per month (9% per year).
What is the NPPF in Mauritius?
The National Pension and Provident Fund (NPPF) replaces the National Pension Fund from 1 July 2027. It is a defined-contribution scheme with individual member accounts, paying a monthly pension and an optional lump sum at retirement.
What are the new pension contribution rates?
Under the NPPF, employees earning up to Rs 50,000 per month contribute 1.5% of basic salary and employers contribute 7.5%. For earnings above Rs 50,000 (up to eight times median earnings), the rates are 3.0% and 10.5% respectively.
Will current pensioners lose their pension?
The Government stated that over 90% of the 263,200 currently eligible pensioners will still benefit from the State Age Pension, including over 75% who will receive the full pension.