Set up independent probe into EPF, PRM urges Parliament

comments     Michelle Lee     Published     Updated

The Parliament must set up an independent investigative body to look into the management and administration of the Employees Provident Fund, PRM president Dr Syed Husin Ali said today.

This is imperative considering the many financial scandals which EPF has had a part in, he stressed in a statement.

He pointed out that the EPFs excuse that the five percent dividend, the lowest to its contributors in some 40 years, contradicts the governments boast that the economy was on its way to recovery.

Further, In 1998, when the economic downturn was at its worse, how was it that EPF could still afford to pay a dividend of around eight percent? he asked.

It is the flimsy financial management of the fund, namely in its investment and loans sectors, which resulted in EPFs dismal earnings in recent years, he added.

Questionable practices

He claimed that questionable practices in EPF began when Prime Minister Dr Mahathir Mohamad came into power.

In the early 1980s, when the price of tin fell drastically, Mahathir tried to save the industry by initiating his stockpiling project and buying tin off the international markets using EPF money.

When the project failed, EPF lost some RM600 million, an enormous sum in those days, but this loss was not made known to the public or to the media, he added.

Syed Husin also referred to the millions EPF lost due to irresponsible investing or lending, including the infamous Perwaja Steel affair.

In 1996, after Eric Chia took over Perwaja (as managing director), EPF granted him a RM500 million loan.

But Perwaja now owes the bank some RM10 billion. It is almost bankrupt and may not be able to pay off its debts. The RM500 million loan which actually belongs to the public is sure to disappear into thin air just like that, warned Syed Husin.

The opposition leader stressed that the money belonged to the workers and should not be misused to benefit cronies or bringing back companies from the dead.

Workers who contribute money into the EPF have a right to know and must be made aware of the ways in which their hard-earned money is being utilised, he said.



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