New fund for workers without social security

       The government will throw a safety net to the 24 million workers left out in the cold by the social security system or other welfare plans.
       Tomorrow, the Cabinet will introduce a "national savings fund" for workers so that they can access social welfare benefits after retiring at the age of 60. The government will end up contributing Bt22.95 billion to this national savings scheme.
       Only 30 per cent of all workers are covered by the social security system, provident funds or other schemes, while 70 per cent or 24 million lack financial protection for their golden years.
       Under the proposal, the permanent secretary for finance will chair the national savings fund, which will collect contributions from workers wishing to subscribe to this plan.
       According to the draft bill for the national savings fund, obtained by The Nation, any Thai under 60 years of age can join, provided that the individual does not belong to other social safety net programmes.
       The minimum contribution for members will be Bt100 a month but they can add Bt100 to Bt1,000 a month on top of that, depending on their ability to save.
       Then the government will pitch in its share to the fund every month according to the age of the worker as follows:
       Members under 20 - no state contribution
       Members aged 20-30 - Bt50 state contribution
       Members aged 30-50 - Bt80 state contribution.
       Members aged 50-60 - Bt100 state contribution
       Sources said the Finance Ministry is confident that the national savings fund could provide for all the 24 million workers now outside the social safety net. After their retirement, they will get financial support from the national savings fund for the rest of their lives.
       If a worker joins the national savings fund at the age of 20 and contributes the minimum amount, by the time of his retirement, he will get Bt1,710 a month, or Bt2,210 a month including other allowances.
       If all 24 million workers participate in the national savings fund, the government will have to chip in Bt22.95 billion or 0.27 per cent of gross domestic product.
       If only half of the workers opt for the fund, the state will subsidise only Bt11.47 billion, or 0.14 per cent of GDP.
       Sources said the national savings fund is designed to address the rapid greying of the population because once these workers reach mandatory retirement, they at least will receive a monthly paycheque to live on.
       The creation of the national savings fund is also part of the country's attempt to increase the pool of savings, which can be used to finance investment and reduce the country's reliance on foreign borrowing.