Saudi Arabia to expand pension and savings programme to foreign workers

Saudi Arabia is preparing to launch a voluntary pension and savings programme that, for the first time, will include foreign workers along with Saudi nationals. The plan, known as the Public Pension and Savings Programme, was introduced in the International Monetary Fund’s ( IMF) latest Article IV consultation report, cited by Al Eqtisadiah, as per a Gulf News report.

The programme is expected to be announced soon and aims to encourage household savings while reducing the large volume of remittances sent abroad. Last year, foreign workers in Saudi Arabia remitted SR144.2 billion ($38.4 billion), marking a 14 percent rise compared with the previous year. Over the last decade, cumulative remittances have reached SR1.43 trillion.

According to the report, in the first quarter of 2025, Saudi Arabia’s social insurance system had 12.8 million subscribers, with nearly 77 percent being foreign workers. The new savings plan is designed to give them an option to save and invest within the Kingdom rather than sending most of their earnings overseas.

The scheme follows major pension reforms approved in July 2024, which increased the retirement age, extended contribution periods, raised contribution rates, and narrowed benefit entitlements. The IMF noted that these measures are expected to strengthen the long-term sustainability of the pension system, although immediate fiscal savings are unlikely.

The IMF welcomed the extension of the new savings programme, describing it as an important step that could “significantly enhance household savings and reduce external remittances.” It also underlined the scale of the General Organization for Social Insurance’s (GOSI) assets, estimated at about 32 percent of Saudi Arabia’s GDP, and called for greater financial transparency and clearer investment allocations.