Tabling a recent communication by the EPF accusing that attacks on the EPF have been stepped up since December 2011 by a “particularly vociferous US-linked anti-China opposition MP carrying out a contract for unspecified foreign interests to wrest control of the EPF to private parties connected to him based on a consultancy report by McKinsey and Co,” UNP MP Harsha de Silva on Wednesday slammed the Government for falling to such low depths to answer criticism levelled against certain investments of the EPF in the Colombo Stock Exchange.
Speaking authoritatively, he argued that there must be a professional approach to responding to questions instead of attempting the sidetrack the issues. He complained that while his straightforward questions on the EPF had been postponed many times for over one year, the EPF Department of the Central Bank was making wild and defamatory allegations against opposition MPs by issuing such ridiculous statements.
He argued that the EPF had not performed its duty and that it had continued to pay its members less than what was intended.
A new angle to the debate was opened by de Silva when he said that late Minister T.B. Illangaratne introducing the EPF Act most likely meant that the minimum return of 2.5 per cent to be made annually to the members was a ‘real return,’ that is, net of inflation. He said that given inflation was below one per cent for around a decade prior to that and given Government Securities yielded around 3.5 per cent would have led to Parliament passing legislation to that effect.
He argued that even though the EPF Act was never amended to change this 2.5 per cent rate of return for its members, that as per the act the comprehensive restructuring of the investment policy approved by the Monetary Board in 2002 did specify a four per cent annual real return.
He pointed out that in the last eight years the average real return, calculated by the formula provided in the EPF Investment Policy, was only 1.15 per cent and nowhere near the stated four per cent.