According to a recent survey, many Taiwanese fear they will not be able to receive their labor pension upon retirement, with nearly 60 percent of those surveyed saying they believe the Labor Insurance Fund will go bankrupt.
With reports on the possible bankruptcy of the labor fund, people now think that money in their hands is a better option, with 67 percent of workers (up 20 percent from earlier figures) opting to collect their labor pension in a one-time lump sum payment upon retirement, according to a survey carried out by Yes123.com, an online job bank.
The survey found that up to 60 percent of people are worried about being unable to collect labor pension after retirement, and if given a free choice, nearly 60 percent of workers would choose not to sign up for the Labor Insurance Fund.
Results showed that 70 percent of people believed that the government should establish a single national insurance program that is fair and equitable for everyone.
According to a recent Council of Labor Affairs (CLA) report, as a result of the aging population, the insurance fund will begin to record a deficit in 2017, three years earlier than originally projections.
The fund currently has an estimated value of NT$530 billion (US$18.15 billion), but has accumulated hidden debts of more than NT$7.3 trillion, and is forecast to go bankrupt by 2027, four years earlier than previous estimates.
In the survey released this week, 59 percent of those polled believe the labor fund — which provides money for retired workers’ pensions — will go bust, while 85 percent said that the labor fund deficit has damaged the public’s trust in the government.
The survey also indicated that, prior to the reports on the deficit, 55 percent of workers had planned to collect a monthly pension.
However, after the report, the percentage of workers opting for the one-time lump sum payment rose from 45 percent to 67 percent.
Huang Yu-ling (黃玉齡), public relations officer at Yes123.com, said that given the problems with the labor fund and stagnating wages, the government must restore the public’s confidence by being open and transparent about how the fund is managed.
As a compulsory program, 9 million workers are required to pay into the Labor Insurance Fund.
The survey indicated if workers were free to choose, up to 58 percent would not sign up for the program.
To avoid bankruptcy, council has proposed either raising premium payments, using a lower income–replacement rate, or delaying the time when workers would be eligible to collect payments. However, such measures are opposed by the public.
More than 80 percent of respondents said they would not accept raising payment premiums while 77 percent opposed delaying the time when workers would be eligible to collect payments.
Asked who is responsible for the fund’s problems, 58 percent said President Ma Ying-jeou (馬英九), followed by CLA Minister Pan Shih-wei (潘世偉).