Minister, lawmaker clash over pensions

TRADING BARBS::DPP Legislator Chao Tien-lin clashed with CLA Minister Pan Shih-wei over the labor council’s proposal to raise premiums and cut pensions for workers

By Loa Iok-sin  /  Staff reporter

Thu, Mar 14, 2013 - Page 4

Council of Labor Affairs (CLA) Minister Pan Shih-wei (潘世偉) had a heated exchange with an opposition lawmaker yesterday over a union leader’s remarks that the retirement payouts for some workers are lower than the pensions given to individuals with low incomes.

Given that the Labor Insurance Fund is expected to go bankrupt within two decades, the council has devised two reform plans to mitigate the fund’s insolvency, both of which include increasing premiums for workers and cutting payouts for retirees.

Although the council has yet to make a final decision on the reforms, many unions have already voiced their disapproval.

Greater Kaohsiung-based unionist Lin Ming-chang (林明章) was quoted by the Chinese-language Liberty Times (the Taipei Times’ sister paper) yesterday as saying that some workers are getting pension payouts that amount to less than low-income pensions, despite having paid premiums their entire working lives.

“The Labor Insurance Fund is a social insurance scheme and the low-income benefit is a social welfare scheme — they are two separate things and cannot be compared with one another,” Pan said when questioned by Democratic Progressive Party (DPP) Legislator Chao Tien-lin (趙天麟) on the issue.

“The Labor Insurance Fund is not intended to cover all of a retiree’s expenses and all workers can apply for low-income pensions if they need financial help,” Pan added.

Pan said it was true that some retired workers receive payouts that are less than the low-income pension, but not all payouts are the same.

“The retirement pension a person receives depends on the wages they earned and how many years they worked,” he said.

Chao disagreed, saying that many unionists in Greater Kaohsiung have objected to both reform plans and had asked him to voice their concerns.

“Most unionists told me that they do not support Plan A or Plan B, they want Plan C —maintaining the ‘status quo,’” Chao said.

Pan responded that if no reforms are made, the fund is destined to collapse and everybody would lose.

“I understand that many union leaders in their 50s are in favor of keeping the ‘status quo’ because they are going to retire soon,” the minister said. “However, many younger union members are in favor of reforming the system because it would benefit them.”

As Chao continued to demand that the council come up with a third plan, Pan appeared agitated, saying that the legislator was “mixing social insurance with social welfare, obviously you do not understand the two systems at all.”

“You are just against reforms, ” Pan added.

While Chao did not react to Pan’s remark, it drew fire from DPP Legislator Liu Chien-kuo (劉建國) and Chinese Nationalist Party (KMT) Legislator Hsu Shao-ping (徐少萍), who both said that a lawmaker should not be accused of being anti-reform just because they hold a different view from a government official.

Pan replied that he had been inconsiderate and apologized several times to Chao and to the legislature.

During the meeting, Pan also proposed that since the Directorate-General of Budget, Accounting, and Statistics had forecast that GDP would grow by more than 3 percent in the first quarter, “the minimum monthly wage might be increased by April 1.”

A plan approved by the Executive Yuan says that the minimum monthly wage would be increased if the GDP grows by more than 3 percent for two consecutive quarters, or if the unemployment rate falls below 4 percent for two consecutive months.

GDP grew by 3.42 percent in the fourth quarter of last year, hence if GDP growth exceeds 3 percent in the first quarter of this year, the minimum monthly wage can be increased by the beginning of the second quarter.