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進入《TAIPEI TIMES》 Interest rate bill passes second reading
People opposed to pension reform protest outside the Legislative Yuan in Taipei yesterday. Photo: CNA
DOWN TO ZERO: Legislators from the pan-blue camp tried to block the bills’ passage, saying cutting the preferential interest rates would affect retired civil servants’ livelihood
By Sean Lin / Staff reporter
Lawmakers yesterday passed draft articles that would see the controversial 18 percent preferential interest rate for retired civil servants’ savings accounts conditionally phased out.
The Democratic Progressive （DPP） caucus, which has a legislative majority, yesterday passed the second reading of the draft article proposed by DPP Legislator Tuan Yi-kang （段宜康） with a majority vote in a plenary meeting of the legislature’s extraordinary session.
The draft seeks to reduce the 18 percent preferential interest rate to zero two years after the pension reform bill’s promulgation.
The DPP caucus had previously supported a draft proposed by the Presidential Office’s Pension Reform Committee, which sought to reduce the interest rate to 6 percent six years after the pension reform bill’s passage, but earlier this week announced that it would back Tuan’s draft, which sets a two-year “transitional period.”
Civil servants hired before July 1995 who benefit from the interest rate would see the rate cut to 9 percent from the second year after the pension reform law takes effect, according to the draft.
Starting from the third year, the interest rate would be reduced to zero, it states.
Legislators from the pan-blue camp yesterday tried to block the draft’s passage, saying that slashing the interest rate would affect former civil servants’ livelihoods.
However, New Power Party caucus convener Hsu Yung-ming （徐永明） said that the draft would not eliminate the 18 percent interest rate, as former civil servants under the “old” pension system predating July 1995 would still receive 6 percent interest after the new rules take effect.
Lawmakers on Thursday passed a draft to set a minimum monthly pension of NT$32,160 for public servants.
A “ceiling” on civil servants’ income replacement ratios — set at 77.5 percent according to a draft passed yesterday — would allow high-ranking civil servants affected by the phase-out, but who chose to convert their pension and interest into a monthly payment, to continue earning an interest payment to match the ceiling, Hsu said.
For example, under existing rules, a former public servant of the 12th pay grade who qualifies for the 18 percent interest rate is paid a pension of NT$48,698 and an interest payment of NT$22,788 each month, he said.
The pension payment would be capped at NT$55,729 after the new rules take effect, but the government would still have to pay them interest totaling NT$7,031 to meet the ceiling, he said.
Meanwhile, legislators earlier in the day decided that the basis for calculating civil servants’ and public-school teachers’ pensions would be changed from the salary they are paid upon retirement to their average salary over the last 15 years of their career.
DPP Legislator Yu Mei-nu （尤美女）, who proposed the draft, said before voting began that public servants’ salaries are in direct proportion to their seniority, while the salaries of ordinary workers fluctuate and could decline as they age, putting them at a disadvantage when their pensions are calculated.
The draft was to ensure fairness across the pension systems, she said.
新聞來源：TAIPEI TIMES
