Small populations and high gross domestic products allow the Gulf states to fund the welfare of their people without needing to impose many financial obligations upon them. (This also means that the governments avoid the high costs of administering such schemes.) Nationals are automatically provided with extensive state help, including medical care, sickness and maternity cover, child care, pensions, unemployment benefit and in some instances housing and disability benefits.
Foreign workers have access to medical facilities, but to little else. In fact, Dubai is beginning to pressurise companies to provide medical insurance for their employees to ease expatriate pressure on state healthcare programmes, and private medical insurance is recommended for most foreigners.
There are no state pension schemes in Dubai for foreign expatriates, although certain state institutions and some international companies have corporate pension schemes. If you were paying into a state pension scheme while working in your home country, you should continue to do so, even if in a reduced form, such as Class 3 contributions in the UK. These are usually one of the best investments you can make, for the continuous return they provide upon retirement. (You might also be eligible for certain benefits, e.g. the payment of medical costs, while in Dubai.) Nevertheless, expatriates should take advantage of their high disposable income in Dubai to set up a personal pension plan. There are many companies offering a variety of schemes, either based on lump sums or supported by regular savings.
This article is an extract from Living and Working in Gulf States & Saudi Arabia. Click here to get a copy now.