Thu, May 11, 2017 - Page 3 News List

Teachers’ union blasts removal of reinvestment clause

By Abraham Gerber  /  Staff reporter

A teachers’ union yesterday criticized pension reform amendments that remove requirements for savings to be deposited in pension funds.

“This amounts to committing theft under the cover of putting out a fire,” National Federation of Education Unions vice president Liu Ya-ping (劉亞平) said. “The Democratic Progressive Party [DPP] has claimed that reforms are necessary to prevent pension funds from going bankrupt, but they do not want to return savings to the funds.”

Liu was referring to a decision by a joint legislative committee meeting on Monday to strike out provisions requiring that all government savings be reinvested into pension funds in favor of language stipulating that money saved by the central government should be invested.

A significant portion of savings from proposed pension reforms comes from phasing out preferential rates for savings accounts of public employees, which are financed by ordinary central and local government budget outlays.

Liu compared the current draft language to “cutting out the bladder to treat appendicitis,” saying that interest from preferential savings accounts should instead be deducted from the amount of money retirees are allowed to withdraw from pension funds.

As local government expenditures comprise 70 percent of the revenue savings, only requiring the reinvestment of central government savings would postpone funds’ bankruptcies by six years instead of 16, federation president Huang Yao-nan (黃耀南) said.

DPP Legislator Tuan Yi-kang (段宜康), who chaired the joint committee meeting, has argued against reinvesting government savings, saying that such funds belong to all citizens and that pensions would eventually require further reform to head off bankruptcy, regardless of whether savings are reinvested.

The committee’s decision has also drawn criticism from Minister Without Portfolio Lin Wan-i (林萬億), while DPP caucus whip Ker Chien-ming (柯建銘) said that the issue would be revisited in general assembly negotiations.

Questions regarding the size of union members’ pensions drew an angry response from Liu, who reportedly retired this year.

“If President Tsai Ing-wen (蔡英文) and all of the DPP’s politically appointed officials donate all the money they have received from preferential savings accounts, I will donate mine,” Liu said, while declining to reveal the amount of his pension.

Additional reporting by Tseng Wei-chen

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