A member of the pension fund commission at the Council of Labor Affairs said yesterday that he was removed from his position after going against a plan to invest more of the fund's money in stocks.
Jeng Tsuen-chyi (
According to Jeng, the reason for the dismissal was because he refused to support a plan to allow more of the council's NT$200 billion pension fund to be invested in stocks.
"They wanted to get rid of me because I was strongly against the idea of investing ... more than the fund's 30 percent ceiling in the stock market," Jeng said.
Currently, the labor affairs council's pension fund is allowed to invest up to 30 percent of its assets in equities, though there have been proposals to raise the ceiling to 40 percent.
Jeng claims the council has racked up more than NT$20 billion in stock market losses due to its "unprofessional" investment decisions, which have been motivated more by politics than shrewd investing.
KMT legislators Ting Shou-chung (丁守中), Tina Pan (潘維剛) and Chu Li-luan (朱立倫) and DPP Legislator Chien Hsi-chien held a joint press conference yesterday to show their support for Jeng.
Ting said that a new organizational structure at the pension fund commission didn't "make any sense at all," as it is heavily represented by officials from the central government.
Ting noted that while the number of commission members has increased from 15 to 19, the number of local government representatives has declined from three to two.
Chien said he was opposed to the four government-run funds being used to buy local stocks in an effort to prop up the TAIEX, the nation's main stock index.
"The labor pension fund should be used to take care of the welfare of laborers, not to prop up the stock market," Chien said. "Moreover, the fund should be managed by laborers, not by the Council of Labor Affairs."
But labor affairs chief Chen Chu (陳菊) said yesterday that the pension fund commission's new organizational structure was a "fair and innovative" way to give equal representation to local governments.
The revised rules, implemented on Jan. 31, specify that the term of office for members is one year and that local governments with the largest population of laborers are entitled to take turns serving on the commission's board.
The top six local governments with the largest populations of laborers last year were Taipei County, Taipei City, Taoyuan County, Taichung County, Kaohsiung City and Kaohsiung County.
The labor pension fund is one of four government-run funds which the government sometimes relies on to prop up the stock market.
Statistics indicate that the four funds have incurred paper losses of nearly NT$150 billion since last year.
Losses for the labor pension fund are estimated to be more than NT$20 billion -- the first loss for the fund since it began investing in stocks in 1993.
Under the Labor Standards Law, employers must contribute a minimum of 2 percent of their total monthly salary costs to the Central Trust of China (中信局), which then earmarks the money for the national labor retirement fund.
The fund, which is managed by the Council of Labor Affairs and monitored by the commission, is permitted to invest in bonds, trust funds or stocks.
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