The Fiji Trades Union Congress has objected to any discussion of reducing Fiji National Provident Fund contributions as a cost-cutting measure in response to the ongoing global fuel crisis.
FTUC national secretary Felix Anthony said the suggestion by the Ministry of Finance was a “lazy option” that would result in workers sacrificing hundreds of millions of dollars.
“We recall that workers during and after the COVID crises were forced by the previous government to forgo substantial FNPF contributions by employers,” said Mr Anthony. We cannot have the same anymore.”
He said this was one of the reasons for the current low FNPF balances of workers.
“Currently 86 per cent or 376,111 members of the fund have balances less than $40,000.
“This is a serious concern for workers and their families.
“The primary role of FNPF comes into question.”
He said workers deserved a decent retirement where they could survive on their FNPF savings.
“That is not so currently for the majority of members with low balances.”
Mr Anthony also called on FNPF to review its policy on declaring annual interest rates and the distribution of interest to members.
“This has become necessary due to FNPF now allowing deposits from members in addition to normal contributions.
“We are aware that large sums of money are being deposited by those that can afford and obtain overnight high interest rates such as one declared last year at around 8.25 per cent while the bank would only give between 1 per cent and 2 per cent interest.
“A member with $40,000 would have got an interest of $3300 while a member with $1million would have received $82,500 as interest payment.
“Of the 436,860 members only 4062 members have savings of $100,000 or more, up to more than a million dollars, which accounts for only 3.6 per cent of FNPF members.”
He said of the total membership, only 0.5 per cent had savings of $250,000 and up to more than a million dollars.
“These are the ones who get the real cream from FNPF with the current FNPF policy on deposits, mainly from business owners who actually benefit disproportionately from the FNPF current portfolio.
“This is simply unfair.
“It appears that FNPF is operating as a stock market where you can invest without risk and benefit from its profits overnight except that you cannot sell shares, while 86 per cent lifelong members get the crumbs.”
