Superfunds can do better

I AM disappointed with the way Nasfund, Nambawan Super and PNG Trade Union Congress (PNGTUC) have come out publicly in support of Bank South Pacific Financial Group Ltd (BSP) and Digicel’s protests against the Government’s super tax that was levied against them recently.
The reality is that the Government has the mandate to levy taxes and levies against anybody in the interest of the nation and its people and it does not need to consult or negotiate with anybody.
The support of the executives of these two superannuation funds are hypocritical because saying that this super tax will affect the dividends of the members is false because the Government is directly taxing these two companies and not the members.
It is the companies that are passing on this tax to the members, the simple solution is to recall all investments from BSP and reinvest elsewhere where dividends are higher and sustainable.
The Government introduced the superannuation funds in the early 1980s to cater for the workers’ retirement benefits as we have no social security facilities, old age pensions, or unemployment benefits in Papua New Guinea.
All the superfunds’ executives are familiar with this core purpose as stated in the defence force 2018 annual report.
To this end, the employers were compelled by law to contribute 7 per cent and the workers 5 per cent into their respective superannuation accounts.
It is disgraceful for the president and general-secretary of PNGTUC to come out swiftly in support of BSP and Digicel with two full middle pages paid ad on Dec 6 within 36 hours of the levy being imposed and when the members are suffering through the funds daylight thievery against their retirement monies.
In the mid 1990s, when the members of the National Provident Fund lost around K200 million through the management and board members’ corruption, their deafening silence was noted by the public.
Purportedly, they threatened action but nothing happened and we do not know why.
The commentary made by Dr Thomas Webster in The National on Nov 30 is refreshingly informative but he has missed the point regarding the huge tax, meaning the exorbitant operating expenses improperly levied by superfund executives against the members over that long period.
I would like to remind him that super profit taxes are not new and are useful because as he said in his own words, “it is only fair to redistribute the high profits they (BSP and Digicel) are earning now” for the benefit of the nation and people.
In 1991, before my acting appointment as acting managing director of the former National Provident Fund, I was sent with two others to Singapore to study the Singapore Central Provident Fund.
It was established in 1955 and is still operating as a statutory body with close Government supervision.
All employees in Singapore, both public and private, contribute to the Singapore Central Provident Fund.
Its wealth has reached trillions.
If the superfunds are amalgamated into one, such as the Singapore Central Provident Fund, it will bring immense benefits for the members though increase dividends, the Government through taxes and sales of securities and bonds and the nation through widespread national development activities.

Gerard Tatireta
Former Company Secretary
and Acting Managing Director,
National Provident Fund