Some RM2.7 billion has been transferred out of the Employees Provident Fund (EPF) to insurance companies dealing with the controversial annuity pension scheme over the past eight months, a top union official told malaysiakini today.

Malaysian Trades Union Congress president Zainal Rampak said this "enormous" figure was what had prompted the Congress to seek clarification about the authenticity of the scheme which came into effect last year despite protest from the workers' movement and several non-governmental organisations.

Zainal, who is also president of the Transport Workers Union, criticised the insurance companies for "twisting the facts" and portraying MTUC in a bad light for speaking up against the scheme.

"The so-called Special Task Force to save the annuity scheme has no right to protest against suspension of the scheme as they do not represent the (annuity scheme) policy holders who are mostly workers," said Zainal.

"They say we only represent 10 percent of the insured. They have no business to question us; they are not even a member (of MTUC). Even if we represent one percent of the insured, we have the right to speak," he added.

Hidden agenda

Yesterday, about 1,000 contributors and policy holders met in Subang Jaya, Selangor, to protest the government's suspension of the scheme.

The group, called the 'Special Task Force to Save the Annuity Scheme', urged the government to allow the scheme to continue for the benefit of its five million subscribers.

It insinuated that MTUC had a "hidden agenda for not bringing up the matter during its implementation".

Its chairperson, Gunaras George, said MTUC's opinion should not be the deciding factor for the scheme to continue or stop because the Congress only represented 10 percent of the five million contributors to the EPF.

He also said that if MTUC did not think the scheme was attractive, then the union should just advise its members not to opt for the scheme instead of taking actions that could jeorpadise other subscribers' interests.

The 'task force' is planning to hand in a memorandum this May 29, carrying 100,000 signatures, urging Prime Minister Dr Mahathir Mohamad to allow the scheme to continue operating. They have managed to collect 70,000 signatures thus far, he added.

Nationwide picket

Zainal, who through MTUC represents 550,000 workers and 230 union affiliates, said the insurance agents only spoke for themselves and in the wake of the controversy, they (the insurers) feared losing their profits.

"Imagine how much insurers can gain out of the RM2.7 billion," he asked.

"MTUC does not gain anything. We do not earn any commission. All we have is a responsibility to protect our members," he added.

Zainal said MTUC did not call for the scheme to be abolished but instead requested for it to be deferred until a study by a consultant on its pros and cons had been completed.

He said MTUC would support EPF if it managed the scheme itself as the profits derived from the scheme would flow back into EPF and eventually benefit contributors by way of a higher annual dividend.

To date, the scheme was reported to have attracted some 200,000 subscribers and RM4 billion in premiums.

The scheme is managed by Assurance Alliance Bhd, John Hancock Life Insurance Malaysia Bhd, Mayban Life Assurance Bhd, Malaysia National Insurance Bhd, MCIS Insurance Bhd and Hong Leong Assurance Bhd.

The scheme was one of the issues which had prodded MTUC to plan a nationwide picket which eventually was deferred for three months.

Seven-member team

The decision to postpone the picket came about after Mahathir sent a letter to MTUC promising to postpone the scheme, have more transparency in the EPF management of funds and restore the death and incapacity benefits for members from RM2,000 to the initial RM30,000.

MTUC will meet a consultant from the EPF to iron out issues related to the annuity scheme at the fund's office at Jalan Raja Laut, Kuala Lumpur, tomorrow.

On the issue of the EPF giving out loans to bail out corporations closely linked to the government, Zainal refused to elaborate beyond saying that MTUC has appointed a seven-member team to monitor EPF loan procedures and approval.