SUPERANNUATION LEGISLATION IS PUNITIVE AGAINST WORKERS’ HOUSING NEEDS.

By Lowly Paid Lae Worker

Housing is a right, not a privilege only for those at the top of the food chain to enjoy.
I am a public servant with K7 housing allowance fortnightly and have been living with wantoks ever since I joined the workforce 12 years ago. Though I have some savings at Nambawan Super, I am only eligible to withdraw 100% of employee contributions, which is not enough to meet the deposit for a bank loan to buy or build a house here in Lae. I have a wife and three children; 12, 10 and 7 year olds but still living with wantoks 12 years later.

I would like to recommend to Sir Nagora Bogan’s Task Force on Taxation and O’Neill Government to change the Superannuation Legislation so that members can be able to withdraw 100% of their savings to use as a deposit to buy a house or build one. This should include 100% accumulated interest, employee and employer portions so it can be enough to put in a deposit for a housing loan. 

The amended legislation should not allow members to repay Nambawan Super or NASFUND as we are already repaying a loan and interest to a bank and hardly do we have anything leftover to make the normal contributions plus housing advance repayments to super funds. 

The appreciating value of a purchased property should more than make up for what I am not repaying to my super fund, but is locked away safely in the appreciating value of my own home. Super funds shouldn’t use the reason that we are total idiots and don’t know how to invest as an excuse to prevent Bank of PNG and the Government from changing the current anti-worker, rigid and punitive legislation not to withdraw an advance to build or buy a residential home.

Due to the scarcity of land around PNG, the value of a property in urban centres appreciates in value every year on average by about 20%. That’s way more than the 15% that superannuation funds beat their chests claiming to having paid as interest into member accounts on average over the last 10 years. 

By withdrawing 100% of one’s superannuation savings and investing in a residential home is way more lucrative than the proposition by super funds. The other value is that super funds can not borrow against my savings to increase its investment capital so it can invest more and credit me more in interest earned. While if I invest all of that money into a residential property, I should be able to borrow against the value of my equity in capital value appreciation to engage in other SME businesses or other productive things in my life such as getting a loan to send an immediate family member overseas for medical treatment that is not available in PNG. While our funds are locked away in super funds, we are missing out more than if we withdraw 100% of our savings including employee contributions, employer contributions and accumulated interest to invest in a residential property.

Owning a home is a long-term investment just like my Nambawan Super savings are. Basically, it is transferring from one asset class of a long-term investment (Superannuation) to another long-term asset class (owning a home). And this time, I am managing my own superannuation savings for my greatest benefit and not my super fund which invests only in office properties. I want to enjoy living in my own house for as long as possible instead of only when I reach 55 years of age for retirement and close to go and live in the grave. The lifespan of Papua New Guineans is only up to 65 and I will only be able to live in my own house for 10 years, while I will have spent about 30 years giving my services to the nation with everyday as a struggle because of the pressure of living with wantoks, high rental or living in squatter settlements (slums).

Lowly paid public servants and private sector workers, what do you think of my proposal?

PNG is a land of the unexpected; but you can help us to meet expectations by sharing or forwarding this message to as many politicians as possible.

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