Review EPF Act to stop govt using the money: MP

Lagatah Toyos

TAWAU: Member of Parliament Datuk Chua Soon Bui has called for an urgent review of the Employees Provident Fund (EPF) Act 1991 to effectively "stop the Government from continuing to abuse the fund."

She said the Federal Government should lay its hands off the EPF because it is not the Federal government or any ruling party leaders’ ‘piggy bank' which they can simply take out money from under the pretext of helping the poor.

"l call for a debate on this issue (the use of EPF money by the Government), and to be followed by an urgent review of the EPF Act 1991, to effectively Put a stop to the abuse of the Fund by the government," she said.

She said the EPF money has been blatantly and rampantly abused, citing previous cases of bailing out of various ailing government-linked companies (GLCs) like Malaysia Airlines (MAS) and the Putra Light Rail Transit which belongs to Renong.

Her statement followed the Federal Government's move to use RM1.5 billion from the EPF to give special housing loan to unqualified buyers in Kuala Lumpur Federal Territory.

Chua, who is also Vice Chairman of Sabah Progressive Party (SAPP), said it is wrong for the government to abuse the EPF money, reminding that it is the people's retirement fund entrusted by its 12 million contributors, for maximum gain in investment for their retirement.

"EPF is not a social and welfare financial institution and thus should not be obligated to any political pressure, even if the EPF Investment Panel thinks otherwise," she said.

She also wanted to know why the Govemment is so desperate in taking money from the EPF, by providing a surety of 2.67 times of the borrowed sum for the said “easy financing scheme " for the home loaners.

 

She said such a proposed move also does not reflect well on Prime Minister cum Finance Minister Datuk Seri Najib Tun Razak's constant claim of the national revenue having grown by RM26 billion for 2010-2011.

"Where have all the monies gone to?" she asked. She also disagreed with Najib's contention that the proposed borrowing is only a small amount compared to EPFs total fund of RM440.52 billion.

"That may be a small amount for him (Najib) but it is definitely a big amount for each and every EPF contributor, and it means a lot to them. They certainly don't want their'retirement funds to be manipulated for other means," she said.

Chua also concurred with the Malaysian Trades Union Congress (MTUC) Secretary-general Abdul Halim Mansor, that EPF should build homes for the low-income groups in the country, its contributors in particular, instead of financing such housing projects.

Under the scheme, applicants will receive a 100 per cent loan, with a repayment period of up to 25 years to allow loan borrowers to make "affordable" monthly repayments.

Under the deal, the EPF is said would be earning 5.5 pel cent interest per annum in repayments made by every homeowner.

However, Abdul Halim pointed out that 5.5 per cent was below the normal rate of retum for EPF which dished out 5.65 and 5.8 per cent dividends in the last two years.

The decisior to use EPF for funding the Federal Territory Foundation's special housing loan scheme for homebuyers, who are not qualified to loan from the financial institutions and bank has also received negative reaction from many others.

Even the EPF employee representatives were reported in a local news portal (Malaysian Insider) that the Government did not consult them over the matter.

Former Sabah Commercial Employees Union (SCEU) General Secretary Rebecca Chin, who sat on the EPF board from 2007 to Jan 31 this year, told the portal that she was not informed of the new loan scheme during any of the EPF board meetings.

She said by convention they all should have been informed, adding she was a represetative of the SCEU until Jan 31, but that she and the rest of them were not aware of the loan scheme until the announcement was made and they found it out when reading it in the newspapers.

"We know the government system, and how it works...l've yet to be briefed or notified about it,” she said, when asked if it was unusual that she was not informed about the new scheme.

The EPF s board of employee representatives also include the Malaysian Trades Union Congress (MTUC) President Mohd Khalid Atan, National Union of Teaching Profession (NUTP) Secretary-General Lok Yim Pheng, Sarawak Bank Employees Union (SBEU) president Hadiah Leen and newly-appointed SCEU General-Secretary Azlin Awang Chee.

DAP publicity chief Tony Pua was also report- ed to have said that the government's plan to use the RM1.5billion from the EPF to give home loans to unqualified buyers is in breach of the EPF Act 1991, which sets out permissible investment to activities for the fund.

He said while EPF may lend money to Federal and State Governments, corporate bodies and even members of the fund to buy or build a house, it cannot provide loans to individuals for the purposes of acquiring low-cost apartments using the property as a collateral.

The EPF is not a lender of last resort for the poor, said Pua, adding the fund is committed to preserving and growing the savings of its members in a prudent manner in accordance with best practices in investments and corporate conduct.

Daily Express

Wednesday, 15 February, 2012

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