The Chinese Nationalist Party (KMT) has proposed a bill to require the government to subsidize the Labor Insurance Fund with at least NT$80 billion (US$2.71 billion) per year to keep it from going bankrupt, KMT caucus whip William Tseng (曾銘宗) said on Sunday.
The KMT caucus called on the government to address the imminent bankruptcy of the fund, which is intended to provide retirement pensions for workers.
It proposed an amendment to the Labor Insurance Act (勞工保險條例) for the government to allocate at least NT$80 billion for the fund annually to ensure its sustainability, Tseng told a news conference in Taipei.
The amendment would also require that the fund’s finances be clearly defined and that the government be responsibility for ensuring it meets its payouts.
A 2020 Ministry of Labor report said that the fund had an estimated NT$10 trillion in hidden debt, which was increasing annually by NT$500 billion, KMT caucus deputy secretary-general Hsieh Yi-fong (謝衣鳳) said.
The fund’s financial condition is rapidly deteriorating, Hsieh said, adding that in the past five years, it has posted losses and could go bankrupt by 2028.
Tseng said that although the government in 2017 promised to improve the pension systems for military veterans, public-school teachers, civil servants and workers, it had yet to take action on reforming the labor insurance system beyond allocating funds.
Unless the central government subsidizes the fund with at least NT$80 billion per year, it would go bankrupt within six years, affecting more than 10 million workers, Tseng said, citing ministry data.
He said that when he asked Premier Su Tseng-chang (蘇貞昌) about the issue during a legislative question-and-answer session in 2020, Su told him the government would take responsibility for labor insurance payouts and prevent the Labor Insurance Fund from becoming insolvent.
Su said that a fund reform proposal would be submitted to the legislature by 2024, Tseng said, adding that he now wants the government to say when it would propose such a bill.
KMT Legislator Cheng Cheng-chien (鄭正鈐) said that the government should improve the management of the fund by studying the management mechanisms of the retirement and compensation funds of private schools.
It is only by improving the Labor Insurance Fund’s management and maintaining its balance at a stable level that it can be prevented from going bankrupt, Cheng said.
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