(Kuala Lumpur, Sunday): At the Malaysian Trades Union Congress (MTUC) Workers’ Day rally on Friday, MTUC President Zainal Rampak said that decisions on Employees Provident Fund (EPF) investments are made by the EPF Investment Panel which reports directly to the Finance Minister without referring to the Board.
He said: "Under the present set-up, we do not know the form of investments made by the fund and where the money went while the dividend received by contributors dropped every year".
I am shocked by Zainal Rampak’s revelation for he is one of the five EPF Board members appointed to represent the interests of the workers, and what he said is not only against the law but also against the solemn assurance given by the government in Parliament in 1991 during the debate on the Employees Provident Fund Act 1991.
Section 18(2) of the EPF Act 1991 said: "The Investment Panel shall be subject to such directions issued by the Board and approved by the Minister, from time to time."
During the debate on the EPF Act 1991, DAP Members of Parliament objected to the omission of having no worker representatives on the seven-man Invesment Panel, but the then Deputy Finance Minister, Datuk Ghani Othman assured Parliament that the workers’ interests would be protected as the Investment Panel is finally answerable to the EPF Board.
This was why I could not believe my eyes when I read in the press yesterday the following statement attributed to Zainal: "An investment panel decides where they will invest and they are not answerable to the board but to the Finance Minister."
It would appear that Zainal and the other four trade unions on the EPF Board do not know their rights, duties and responsibilities on the EPF Board and have not insisted on the statutory powers and duties of the EPF Board to issue "directions" to the EPF Investment Panel on general investment policy guidelines.
Although the law provides for the Investment Panel to be responsible for the day-to-day operations and decisions with regard to investments of EPF monies in equities, this is subject to the overall policy direction of the Board as well as close monitoring by the EPF Board to ensure that the Investment Panel adheres to the general policy guidelines set by the Board and that it does not act against the long-term interests of the EPF contributors.
The investment of the RM130 billion EPF funds is in fact the most important duty of the EPF Board and if this jurisdiction is completely taken away from the purview of the EPF Board members, what is the use of being an EPF Board member? Is it just for the namesake as well as the allowance of being a EPF Board Member?
The five EPF Board members appointed to represent workers’ interests should speak up for the rights of the nine million EPF contributors and should not regard their appointments as sinecures. They should in fact make periodic reports to the workers as to how they are protecting and advancing the interests of the contributors at the EPF Board meetings.
If it is true that the Investment Panel had refused to be answerable to the EPF Board, then all the investment decisions taken by the Investment Panel involving billions of ringgit are improper and even illegal.
In view of the widespread concerns about the equity investment decisions made by the EPF in the past ten months, DAP calls for the establishment of an independent commission of inquiry to investigate whether the EPF Investment Panel had made improper, imprudent or even illegal investments involving RM130 billion EPF monies.