The National Savings Fund (NSF) plans to encourage employees working in the formal sector to apply for NSF membership, aiming to boost retirement savings among the workforce.
Jaruluck: Savings remain insufficient
The plan targets an increase in NSF membership to 1.2 million from 540,000, 60% of whom farmers, said NSF secretary-general Jaruluck Ruengsuwan.
Although some workers are registered in the retirement savings schemes, their savings are not sufficient for daily spending after retirement. The plan is meant to increase workers' savings and reduce the government's financial burden in the long run, said Ms Jaruluck.
The law stipulates only informal workers who are not part of the retirement savings system, such as social security, the Government Pension Fund, and provident funds offered by companies in the private sector, can apply for NSF membership. The law would have to be amended to allow formal workers in the fund.
The NSF also plans to increase student memberships as students should be taught to start saving at a young age for future stability, she said. Students make up only 5% of the 540,000 members and the goal is to increase this level to 15%.
"Increasing student membership is a challenge, but we will do everything we can to raise awareness of the benefits of saving with the NSF. We will also place greater emphasis on providing knowledge about retirement savings to people, especially those who have the potential to make significant savings over time. Students can begin saving at age 15," said Ms Jaruluck.
Finance permanent secretary Somchai Sujjapongse, who is chairman of the NSF board, said membership has continued to increase by an average of 2,000-3,000 members per month from an average of 100 at the fund's inception.
NSF had a savings fund derived from members' savings and state contributions worth over 4 billion baht in 2017, said Mr Somchai. Return on investment was 4%, with 80% of the portfolio invested in government bonds and 20% in stocks, he said.
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