No pension scheme under new amendment

Disna Mudalige

The Employee’s Provident Fund (Amendment) Bill scheduled to be presented in Parliament for the second reading on Wednesday has no proposal to introduce a pension scheme, Labour and Labour Relations Minister Gamini Lokuge said. Addressing a press conference at the Information Department recently, the minister said that the clause which referred to setting up of a welfare pension scheme had been withdrawn by the government following discussions with the National Labour Advisory Council (NLAC).

He observed that certain opposition members who criticize the amendments to be made to the Act are either totally ignorant about them or attempting to mislead the public. The minister said that the government has made a policy decision not to introduce a pension scheme for the private sector hereafter unless requests had been forwarded by trade unions. The minister also said that the amendments proposed to the Act were approved by the Cabinet, the NLAC and the Parliamentary Consultative Committee.

According to the proposed amendments, the NIC number of an employee will be used as the EPF number and this number will not change even if the employee moves to another institution. The minister observed that the efficiency of the fund when paying back the EPF money to employees would improve as a result of this new system. He said that the thumb finger print would also be included with the NIC number to ensure the safety of the account.

Lokuge also pointed out that the amendments to the Act would also enable the employees to withdraw 30 percent of the amount in their fund if they have contributed for the fund at least for 10 years and have more than Rs 300,000 in their individual accounts.

This money would be provided for housing purposes or medical requirements such as heart surgery, by-pass surgery, treatment for cancer including surgery, kidney transplant or surgery, cesarean operation or hospitalization for not less than 14 days on account of an accident. Every member is entitled to two withdrawals from his individual account.

The minister observed that this move would save the Fund’s money paid annually to commercial banks to settle outstanding interests and fines on delayed interest payments obtained by the contributors to the fund under the present loan system of the EPF.

The minister also said the laws with regard to the employers who have delayed paying EPF for the employees have been made strict while fines have been increased as well. He said that every employer who have more than 50 employees under him should furnish a report containing membership data to the Commissioner General of Labour and to the Central Bank. The proposed amendments have also provisioned financial allocations for the “Mehewara Piyasa” a new building being constructed to be used as a Secretariat Office of the Fund.

Responding to a question of a journalist the minister also said that the annual account report of the EPF for 2010 would be tabled in Parliament within this month.