Interests fight about pensions

The fate of the controversial labor pension bill (勞工退休金條例), which is slated to receive a final legislative review on Thursday, is still up in the air after contentious cross-party negotiations and a renewed tug of war between labor unions and business groups.

Wong Ying-dah (汪英達), deputy spokesman for the Chinese Federation of Labor, said the group had reached an agreement with the People First Party (PFP) yesterday to endorse a proposal made by the Council of Labor Affairs that would allow employers to pay into the Labor Pension Fund only after employees have worked at their companies for five years.

The agreement stipulates that employees who work fewer than five years at one company will not be entitled to the pension reserves in their individual retirement accounts -- a condition that the federation has previously opposed, Wong said.

The independent lawmakers' alliance hasn't yet given its go-ahead to the council's proposal to revise the nation's pension fund system.

As per the agreement reached between the federation and the PFP, employees' pension reserves accumulated from previous jobs would all be retained, no matter how many years workers work at a single company.

The federation had earlier urged the government to issue bonds on behalf of employers in order to pay full pension benefits into employees' accounts, but it admitted yesterday that such an idea was not workable.

Although an initial consensus was reached yesterday to pave the way for Thursday's final review, business groups may not be happy about the bill in its current form.

Earl Ho (侯貞雄), chairman of the Chinese National Federation of Industries, which represents some 90,000 Taiwanese companies, is expected to discuss the matter with Legislative Speaker Wang Jin-pyng (王金平) early today.

Ho -- accompanied by other business leaders including his two vice chairmen, Preston Chen (陳武雄) and Pan Chun-jung (潘俊榮) -- will make a three-point statement to the legislature, urging it to follow a consensus reached at the Economic Development Advisory Conference in August, 2001, said the group's adviser, Kuo Yung-hsiung (郭永雄).

During that conference, the government agreed that the minimum percentage of an employee's salary that an employer must contribute to the Labor Pension Fund would gradually be raised from 2 percent to 6 percent.

However, the legislature early last month passed a first-reading version of the bill stipulating that the percentage would jump directly from 2 percent to 6 percent, which business leaders argue would place heavy financial pressure on them.

Ho will request that the bill stipulate that employees who have worked less than five years at a single company will not be entitled to the pension reserves in their accounts.

The business group, moreover, will encourage the government to allow businesses to set up their own asset funds -- through which a part of the employees' pension accounts would be managed.