ASSA rejects WB proposal program
ASSA rejects WB proposal program
JIMBARAN, Bali (JP): The ASEAN Social Security Association
(ASSA) has turned down a Word Bank (WB) proposal to allow private
fund managers to handle workers' pension funds and other social
security programs.
Delegations from ASEAN member countries's financial
institutions running social security programs for their workers,
who are here for a three-day annual meeting, warned on Tuesday
that the proposal to privatize the compulsory social security
program, including pension funds, violated human rights and
furthermore was too risky because of the absence of a financial
and legal guarantee that all funds collected from workers and
their employers would be well managed.
Awaloedin Djamin, chairman of the Association of Social
Security Programs in Indonesia (AJSI), suggested that western
country-backed financial institutions such as the World Bank and
International Monetary Fund (IMF) avoid intervention into ASEAN
countries' internal affairs.
"The proposal won't be able to work. With the proposal, the
donor countries of international financial institutions will eye
huge amounts of money collected under the program in ASEAN
countries.
"Government-run social security firms in the region should
remain free to invest their funds and we won't let the World Bank
and the IMF meddle with our internal affairs," he said at the
meeting's opening ceremony.
Awaloedin said the social security program was based on
International Labor Organization (ILO) conventions and universal
human rights and was aimed at providing basic protection for
workers, civil servants, servicemen and public transportation
passengers.
"Besides the universal human rights ILO convention, ASEAN
member countries' constitutions also stipulate an obligation to
provide their people social protection," he said.
He said it would impossible to obtain a guarantee from private
fund managers in case of possible mismanagement or bankruptcy.
Tan Sri Sallehuddin bin Mohammed, chief of Malaysia's
Employees' Provident Funds (EPF), criticized the Bank's proposal,
saying his country was no longer confident in developed country-
dominated international financial institutions.
He questioned the Bank's interests behind the proposal and
said Malaysia would not invest its workers' funds in the
international market.
"Our government, which has run the social security program for
workers since 1952, is confident of its own system," he said.
Malaysia has established the EPF and the Social Security
Organization (SOCSO), two government agencies running the social
security program for more than eight million employees, including
migrant workers.
Leopoldo S. Veroy, vice president of the Philippines' Social
Security System, agreed and said his country would lobby other
ASEAN member countries present at the meeting to issue a joint
communique to improve the maximum benefits workers could gain
from domestic social security programs.
"Our common but fundamental mission is to provide maximum
benefit to the social security program's participants and not how
to invest the funds we have collected from workers," he said.
He said despite their professionalism, private funds managers
could not guarantee that the funds they collected from workers
would be managed well.
He said delegations from Singapore, Thailand and Vietnam, the
most recent ASEAN member country to join ASSA, had also expressed
their objections to the proposal.
Hector Inductivo, director of the International Social
Security Association (ISSA) Asia-Pacific Region, said ISSA would
pay no attention to the Bank's proposal and would instead help
create better labor conditions in the region following the
economic crisis.
He said labor conditions and the social security program in
Indonesia could not progress significantly because of the
prolonged economic crisis. But he expressed optimism that
Indonesia would equal Thailand, Malaysia, South Korea and other
recovering countries, thanks to its economic performance over the
past year and its democratic government. (rms)