The major chunk of investment in Employees Old-age Benefits Institution (EOBI), ie, Rs 225 billion or 68 percent of the total portfolio is in government securities, but it failed to realise 11 percent real return per annum on this investment due to highly volatile stock market and limited opportunities in real estate.
This was revealed by Charmin EOBI Azhar Hameed while briefing the National Assembly Standing Committee on Overseas Pakistanis and Human Resource Development (OP&HRD), which met with Sheikh Fayyaz Ud Din in the chair here on Friday.
Sharing the details of portfolio investment, he said that the bulk of investment ie, Rs 225 billion or 68 percent of the portfolio are in government securities where income hovers currently around 6.5 percent to 7.5 percent per annum, while last actuarial evaluation asked for more than 11 percent per annum real return on portfolio which cannot be realised in this scenario of highly volatile stock market and limited opportunities in the real estate.
The committee was informed that suo motu proceedings were initiated by Supreme Court in June 2013 regarding 18 investment properties purchased by EOBI from July 2010 to April 2013 at approximately Rs 35 billion. The Institution has not been earning any return on amount of Rs 35 billion stuck up in these 18 properties.
The committee was informed that EOBI investment portfolio stands at Rs 343.08 billion, including fixed income, Rs 247.5 billion (72.14%), real estate ,Rs 54.42 billion (15.86%), and equity Rs 41.15 billion (12%). Further the current size of EOBI fund is Rs 331.78 billion.
The EOBI official further said that contribution of Rs 19.06 billion was collected in 2017-18 and it would cross Rs 20 billion by the end of current fiscal year; however contribution decreased after the depreciation of Pak rupee. If depreciation issue is resolved, the EOBI contribution would be around Rs 35-40 billion. The 18th constitutional amendment has made the EOB Act as frozen law and no amendment is possible. The matter is pending in Council of Common Interest (CCI), the chairman EOBI added.
The management has initiated process for reinitiating four stalled project of EOBI and is expected to complete these by December 31, 2020, which may increase the revenue by Rs 5-6 billion. The EOBI is getting around Rs 25 billion income on its investment. Further there are 685 cases in different courts against EOBI including 18 in the Supreme Court.
The chairman EOBI said that pension has been increased by 20 percent with effect from September 2018 and minimum pension has been rounded off to Rs 6,500. The Institution is in a stable position to pay pension till 2029, but if depreciation issues are not there, it would be stable till 2035.
Chairman EOBI Azhar Hameed informed the committee that major irregularities in funds were committed during 2009-2012. He further said that EOBI is moving towards digitisation and modernisation in next three months. He assured the committee that the 347 vacant posts would be fulfilled in the month of July.
The committee also discussed the dual nationality policy in European Union countries. The Islamic Republic of Pakistan has entered into Dual Nationality agreements with 19 countries. The committee recommended that Ministry of Foreign Affairs may initiate negotiations for making dual nationality arrangements with Germany and Spain.
The committee recommended that the report of Auditor General of Pakistan regarding EOBI should be discussed briefly in the next meeting. "We have dual nationality agreements with 19 countries including 11 European Unions countries," said the DG Passport. He said there is need of inking agreements with China, Germany and Spain.
Special Assistant to the Prime Minister on Overseas Pakistanis and HRD Zulfikar Bukhari said that policy for appointment of community welfare counsel abroad will be changed and employees having knowledge about labour laws would be appointed. In the past nears and dears were facilitated due to flaws in the act. The government is going to amend the act, he added.
Bukhari said the government has provided a grant of Rs 2.5 billion for increase in pension. By the end of current government tenure, minimum pension would be increased to Rs 15,000. MNAs Haji Imtiaz Ahmed Chaudhary, Aurangzeb Khan Khichi, Sobia Kamal Khan, Tashfeen Safdar, Shahid Ahmed, Syed Javed Hassnain, Zahra Wadood Fatemi, Dr Mahreen Razzaq Bhutto, Khalid Ahmed Khan Lund, Noor-ul-Hassan Tanvir, Ehsan-ul-Haq Bajwa, Khial Zaman and Dr Haider Ali Khan, besides others attended the meeting.
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