• Rejects merger, says Funds have different objectives
• Calls for CBSL to report to NLAC every three months
• Govt says no immediate merger decision pending committee report

The Employees’ Provident Fund (EPF) and Employees’ Trust Fund (ETF) should not be merged despite shortcomings in their administration, as the two Funds serve different purposes, National Labour Advisory Council (NLAC) member Anton Marcus said.

Speaking to The Daily Morning, Marcus, who is also the Free Trade Zones and General Services Employees’ Union General Secretary, said that while reforms such as requiring the Central Bank of Sri Lanka (CBSL) to submit a performance report on the EPF and ETF to the NLAC once every three months could strengthen oversight, there was no need to merge the two Funds.

The Government had taken a Cabinet of Ministers decision in May to combine the two Funds and establish a separate institution to administer them under a tripartite mechanism involving the Government, employers and employees.

Marcus said the issue was subsequently discussed at the NLAC meeting held on 7 September, where the Government informed the Council that there was currently no intention to merge the two Funds in the near future.

“At the meeting, the Government side said that there is no plan at present to merge the two funds in the near future. They said that a decision would be made once a committee that is currently looking into the issue submits its report. That is where the matter has stopped for now.”

He said the trade union (TU) side had nevertheless made its position clear and was completely opposed to merging the two Funds because the EPF and ETF had different purposes.

“We have clearly stated our position on this. We say that these two Funds should not be merged at all. The two Funds have two different objectives, so, we are completely opposed to merging them,” he said.

Marcus also said that the Funds were currently held securely under the CBSL and that the relevant legal provisions identified the Central Bank as their custodian.

“The money in these Funds is currently safely held under the CBSL. The relevant legal provisions themselves state that the custodian of these Funds should be the CBSL. Therefore, we are always of the view that these Funds should remain under the CBSL's guardianship.”

However, he acknowledged that there were shortcomings in the administration and operation of the Funds that needed to be addressed, but said such issues did not justify changing their overall structure or transferring their administration away from the CBSL.

“There are certain shortcomings in these Funds and those shortcomings need to be corrected. But, there is absolutely no need to merge them in this manner. We are opposed to that,” Marcus said.

He proposed that the EPF and ETF should instead be brought under more direct oversight, with the CBSL required to provide a performance report to the NLAC at least once every three months.

“At least once every three months, the CBSL should provide a performance report relating to the EPF and the ETF to the NLAC. Then, as members of the Council, we can monitor the situation and identify any shortcomings that may exist. That is what the Government should do.”

Deputy Labour Minister Mahinda Jayasinghe and Labour Ministry Secretary S M Piyatissa were not available for comment.

The Government had earlier announced that it would appoint a senior officials’ committee to examine the feasibility of integrating the EPF and ETF under a unified governance framework overseen by a tripartite board representing the Government, employers and employees.

Cabinet Spokesperson Dr. Nalinda Jayatissa had said that the separate administrative and regulatory structures of the two Funds had resulted in overlapping functions and a fragmented policy approach.