Old-age benefit applicants surge by 60 percent: CLA
By Ann Yu ,The China Post
October 19, 2012, 12:10 am TWN
Applicants for old-age benefits have increased more than 50 percent in recent days after the government warned that the Labor Insurance Fund could go bankrupt in a decade. Most recipients have chosen to receive the payment in one lump sum instead of the other option of monthly installments.
The Bureau of Labor Insurance (BLI) under the Council of Labor Affairs (CLA) urged the public to remain calm, and stated that some who chose to receive the payment in one lump sum have later come to regret their decision.
"Claiming the payments on a monthly basis is more economic than receiving the total amount at one time," the bureau said.
The threat of losing one's old-age benefits began appearing this month when the CLA announced the Labor Insurance Fund might go bankrupt. Panic surrounding the issue intensified when the government proposed an amendment that would shrink future benefits, sending applicants scrambling to collect their payments.
According to the bureau, the number of phone calls to the office since last week has exploded, with a 50-percent increase in daily callers to the information counter. Application forms piled up to a record high of 2,400 in one day this week, although the amount in subsequent days decreased to below 2,000. "This is still more than the average 1,500 forms daily, " the BLI said.
According to the bureau, no matter how the government finalizes amendments regarding the labor fund, receiving the payment on a monthly basis will always be more economical. An official recalled a related incident in 2008 when many people decided to collect a lump sum payment for fear of losing their benefits.
"Many people have come back to the council wanting to change back to a monthly payment, but we couldn't make the changes under the regulations," the official said.
The bureau has said the government "will bare full responsibility in protecting workers' rights, so people need to think carefully before making decisions." In addition, the bureau will launch 40 to 50 forums around the nation to explain the functions of the Labor Insurance Fund.
Premier Sean Chen yesterday again promised that the Labor Insurance Fund will not go bankrupt.
The fund still possesses a stock market value of more than NT$530 billion so people shouldn't panic," he said.
"Moreover, labor insurance is a social welfare program to protect workers," and thus "the government will take full responsibility for reaching a solution," he added.
Old-age benefits are part of an insurance plan that can be claimed by workers who are over 60 and have had insurance coverage for more than 15 years. Workers can also choose to postpone claims or apply for the payments in advance.