NPF members asked not to panic

By Sophie Foster Hildebrand

PAPUA New Guinea’s prime minister Sir Mekere Morauta has made an appeal for calm to members of the country’s troubled National Provident Fund (NPF). The appeal came after the NPF made a statement saying it may have to halve the contributions of members because of financial troubles. “I would like to remind employees and employers that any hasty' moves to take legal action now might in fact threaten any rescue package that might be put together. “If the NPF is forced into a fire sale of all its assets, the returns to members will be even less than they are now. “I appreciate the anger that this is causing hard-working fund members and employers who have contributed to the NPF but I believe that their best interests will be served by waiting until the inquiry is finished and the appropriate action is taken.

“Any action that is not carefully considered will put at risk the future of the fund and members’ payouts. The only thing that can preserve the interests of contributors is co operation.” Sir Mekere said if unions and employers join government in Hying to rebuild the fund and then to reshape the superannuation industry, eveiyone will be a winner. He added that in the longer term, regulating and liberalising the superannuation industry was the only way forward. “There is no doubt that there has been a complete breakdown of systems and processes in the NPF.

“Much of the preliminaiy evidence we have gathered indicates that government meddling

through making political appointments is a

major factor in these losses. “There has also been a failure in the systems under which the managers and trustees responsible for looking after members’ interests perform their duties,”

Sir Mekere said. A complete overhaul of the industry was necessary because, although other funds were not in the same position as the NPF, their returns to members were generally very poor by international standards, he said.

The strategy that government is developing, based on its privatisation policy, would eliminate state interference, lessen opportunities for corruption and mismanagement, and bring in competition. The prime minister said this would

promote professionalism, integrity and

accountability and ensure members benefitted from world’s best practice. ■