Fresh discussion needed on EPF, ETF

Wednesday, 4 November 2015 00:16 - - {{hitsCtrl.values.hits}}

It is high time there is some discussion about the management of the EPF and ETF funds as it is not State-owned money – it belongs to the hard working employees of the country. Therefore, these funds must not be misused to fulfill the wishes of politicos and other petty political agenda.

These funds have not published their financials since 2012, I believe. There is no transparency with regard to the affairs of these funds. For instance, the amount of disclosure in the Norwegian Wealth Fund managed by the Norwegian Central Bank is extensive. Although I do not expect this level of disclosure, there must be a reasonable amount of it.

The funds are believed to be selling off large stakes in strong listed companies at dirt cheap prices these days at the expense of the members’ retirement funds. Also, the government securities allocation is I believe well over 90% which may hamper the returns. In the case of the aforementioned Norwegian fund, equity allocation is around 65% which is reasonable.

These funds hold large stakes in private banks purely with the motive of allowing the government to control the system. Doesn’t the 15% rule apply to them? The EPF has not invested in well-run, liquid companies while it has taken up significant stakes in many failed ventures.

I urge you to consider featuring this matter for public discussion as a social service to many of your readership.

Nisal Karunapala