5/15/2014
Next Up in Venezuela – Draining Public Workers’ Savings Funds
From the Editors of VenEconomy
As if things were not bad already in the economy of Venezuelan workers (as are for the rest of the citizens), now the Government has laid its eyes on the savings coming from their wages and social benefits, desperately seeking to get more resources to feed its “Revolution.”
This way it begins to take shape an announcement made by President Nicolás Maduro on May 1 on the purpose to create a fund so workers can “make the most of” their social benefits. The idea of Maduro and his governing coalition is to activate the so-called National Savings Fund of Social Benefits (FNAPS) as provided for by the Organic Labor Law (LOTTT) as one of the three options for workers to safeguard their social benefits (the other two according to article 143 are: in an individual trust fund or the accounts of the company they work for.) A legal mandate that only private companies were complying with until today.
According to the Government’s own announcement, the new FNAPS would not be compulsory to adopt, while it would feed from both trust funds of workers and deposits from savings accounts, whose net worth is estimated at more than Bs.5 billion (about $100 million.) And here comes the first concern from workers with regard to the free administration of their own money: how much freedom will be given to public employees so they can decide the fate of their social benefits with a government whose predominant characteristic is despotism and intolerance against those disagreeing with it?
Workers are also on high alert for the proposal of Maduro in performing “financial engineering” by lumping together the resources of their social benefits, of their savings accounts and those of the State’s social investment, to perform “the second miracle of the housing program Gran Misión Vivienda Venezuela,” and supporting other social programs such as Mi Casa Bien Equipada (home appliances) and the purchase of vehicles through the Chinese-Venezuelan joint investment fund.
Another concern from workers is based on the secrecy and poor transparency that exists in the handling of social benefits of public workers. It is worth mentioning, for example, the Pension Fund of public sector workers, whose resources (coming from a 4% deducted to workers of the Public Administration) nobody knows of its whereabouts, as denounced by Froilán Barrios from Fadess, a trade union. Or the pension fund of workers of state-owned oil company PDVSA, which some $594 million disappeared through a Ponzi scheme led by Francisco Illaramendi, a Venezuelan banker, and no one has been held responsible for to date.
These recent precedents may indicate that social benefits from public employees will probably vanish in the wasteful hands of the corrupt Venezuelan “Revolution” due to this non-reliable initiative from Maduro of “creating a new scheme and protection of funds,” just as happened in Argentina a few years ago.
source
Next Up in Venezuela – Draining Public Workers’ Savings Funds
From the Editors of VenEconomy
As if things were not bad already in the economy of Venezuelan workers (as are for the rest of the citizens), now the Government has laid its eyes on the savings coming from their wages and social benefits, desperately seeking to get more resources to feed its “Revolution.”
This way it begins to take shape an announcement made by President Nicolás Maduro on May 1 on the purpose to create a fund so workers can “make the most of” their social benefits. The idea of Maduro and his governing coalition is to activate the so-called National Savings Fund of Social Benefits (FNAPS) as provided for by the Organic Labor Law (LOTTT) as one of the three options for workers to safeguard their social benefits (the other two according to article 143 are: in an individual trust fund or the accounts of the company they work for.) A legal mandate that only private companies were complying with until today.
According to the Government’s own announcement, the new FNAPS would not be compulsory to adopt, while it would feed from both trust funds of workers and deposits from savings accounts, whose net worth is estimated at more than Bs.5 billion (about $100 million.) And here comes the first concern from workers with regard to the free administration of their own money: how much freedom will be given to public employees so they can decide the fate of their social benefits with a government whose predominant characteristic is despotism and intolerance against those disagreeing with it?Workers are also on high alert for the proposal of Maduro in performing “financial engineering” by lumping together the resources of their social benefits, of their savings accounts and those of the State’s social investment, to perform “the second miracle of the housing program Gran Misión Vivienda Venezuela,” and supporting other social programs such as Mi Casa Bien Equipada (home appliances) and the purchase of vehicles through the Chinese-Venezuelan joint investment fund.
Another concern from workers is based on the secrecy and poor transparency that exists in the handling of social benefits of public workers. It is worth mentioning, for example, the Pension Fund of public sector workers, whose resources (coming from a 4% deducted to workers of the Public Administration) nobody knows of its whereabouts, as denounced by Froilán Barrios from Fadess, a trade union. Or the pension fund of workers of state-owned oil company PDVSA, which some $594 million disappeared through a Ponzi scheme led by Francisco Illaramendi, a Venezuelan banker, and no one has been held responsible for to date.
These recent precedents may indicate that social benefits from public employees will probably vanish in the wasteful hands of the corrupt Venezuelan “Revolution” due to this non-reliable initiative from Maduro of “creating a new scheme and protection of funds,” just as happened in Argentina a few years ago.
source
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