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FNPF Record Payout Praised

The reforms of Fiji’s superannuation fund the Fiji National Provident Fund which were put in place by the Bainimarama-Government have been vindicated by the fund’s performance. Attorney-General and Finance Minister
29 Jun 2015 11:32
FNPF Record Payout Praised

The reforms of Fiji’s superannuation fund the Fiji National Provident Fund which were put in place by the Bainimarama-Government have been vindicated by the fund’s performance.

Attorney-General and Finance Minister Aiyaz Sayed-Khaiyum yesterday commended the FNPF board chair Ajith Kodagoda and his Board for the record payout of $225million to members.

Mr Sayed-Khaiyum said payouts announced by previous Boards were not backed by certification of solvency which makes this payout different and better.

“What is also unique about this situation, about this rate of return is that these rates of returns are certified by the actuarial. It also certifies that there is enough solvency, in other words you have a solvency certificate that says we have enough funds to look after everybody even after they retire.

“You may recall that there was a report that came out which said that all the funds would finish by 2052 prior to the reforms that had taken place. And, prior to that also, when we had previous FNPF boards declaring returns, they weren’t actually certified. There was no certificate on solvency.

“There is a very, very vast difference between this declaration and the declaration of rates of return previously”.

Next on the agenda of the Board is to relook at the pension plan and how to make it better.

“We now also have an opportunity, as we have discussed with the Board of FNPF, to review the pension payout in three years time- the end of three years would be next year.

“Now they will now be looking at what will be the pension payout. These reforms were carried out to address years, if not decades of problems that existed within the FNPF system and that was the lack of certification, that was the lack of financial control regarding investment and understanding of commerce and we now have a chairman and his Board that understand that and we now have a set of laws that actually gives a lot better protection to your funds”.

The FNPF reforms, which were spearheaded by Prime Minister Voreqe Bainimarama as the then Finance Minister were unpopular with some. However, he persevered and members are today benefitting from it.

Mr Sayed-Khaiyum said: “We’d also like to acknowledge and thank the Prime Minister who was Minister for Finance when these reforms took place in FNPF.

“In fact, he drove those reforms, he gave his blessings to those reforms, and I know that many people had made a lot of statements regarding it, negative comments about it- it even became an election issue but they politicised a matter that was actually not a political issue, it was a financial issue, it was a commercial issue, it was an issue pertaining to savings in this country and those reforms have been vindicated now on a number of occasions.”

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