Where's the employees' involvement in EPF?
J SolomonPublished: Dec 1, 2014 9:35 AM | Updated: Dec 1, 2014 9:37 AM
The Employees’ Provident Fund (EPF) was set up to ensure that employees within the private sector would be able to retire with a nest egg - to tide them over their retirement years. At the time in which the fund was set-up, life expectancy was around 55 years. Since then, things have evolved, where apart from increased life expectancy, the functioning and nature of the EPF fund has fundamentally changed.
EPF is now run by a board, supposedly at least. Essentially though, it is the Finance Ministry which calls the shots and runs the investment of EPF by itself. There is a nominal involvement by other stakeholder groups through the workers’ representatives, the Malaysian Trades Union Congress (MTUC). The biggest beneficiaries of the EPF are the employers, in particular companies which are linked to the government - the government-linked companies (GLCs).
Investment decisions by the EPF are made by an investment committee, and there is a need for this to be more transparent with the contributors - the workers. The MTUC should be a part of any decision-making where it concerns investment. It must be stressed here that what is being invested is the workers’ money.
EPF money has been invested and is still being invested to bail out ailing companies. Political patronage is a big reason for EPF investments. By way of such investments, the interests of workers are compromised on.
Another facet of EPF investments which act against the interest of workers is where investments are made in companies which are anti-union and violate workers, trade union and human rights.
On the one hand, EPF invests in companies which allow them more capital to grow their businesses. On the other hand, these same companies could very well indulge in actions against the interest of workers. This cannot make any sense and should cease with immediate effect.
The government should engage MTUC and its social partners based on the tripartite principles in dialogue in order to cater for a proper and ethical functioning of investments by EPF.
J SOLOMON is a vice-president of the Malaysian Trades Union Congress (MTUC).
EPF is now run by a board, supposedly at least. Essentially though, it is the Finance Ministry which calls the shots and runs the investment of EPF by itself. There is a nominal involvement by other stakeholder groups through the workers’ representatives, the Malaysian Trades Union Congress (MTUC). The biggest beneficiaries of the EPF are the employers, in particular companies which are linked to the government - the government-linked companies (GLCs).
Investment decisions by the EPF are made by an investment committee, and there is a need for this to be more transparent with the contributors - the workers. The MTUC should be a part of any decision-making where it concerns investment. It must be stressed here that what is being invested is the workers’ money.
EPF money has been invested and is still being invested to bail out ailing companies. Political patronage is a big reason for EPF investments. By way of such investments, the interests of workers are compromised on.
Another facet of EPF investments which act against the interest of workers is where investments are made in companies which are anti-union and violate workers, trade union and human rights.
On the one hand, EPF invests in companies which allow them more capital to grow their businesses. On the other hand, these same companies could very well indulge in actions against the interest of workers. This cannot make any sense and should cease with immediate effect.
The government should engage MTUC and its social partners based on the tripartite principles in dialogue in order to cater for a proper and ethical functioning of investments by EPF.
J SOLOMON is a vice-president of the Malaysian Trades Union Congress (MTUC).
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