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‘Insurance scheme an additional burden’

Sunday, 4 November 2012

KUCHING: Soppoa (Sarawak Oil Palm Plantation Owners Association) is strongly against the proposal by SPIKPA (Skim Perlindungan Insurans Kesihatan Perkeja Asing) to implement insurance scheme for foreign workers.

A press statement from Soppoa Secretariat yesterday stated that the scheme would make the industry here even less competitive.

“The oil palm industry in Sarawak is a young one, but has once again been targeted for extra burden.

“Soppoa has been informed that the government will be introducing the SPIKPA insurance scheme for foreign workers from Jan 1, 2013, and, together with MPOA (Malaysian Palm Oil Association), are fully objecting to the implementation.”

It added the industry was not consulted on the plan to implement the scheme in Sarawak.

“SPIKPA is not implemented in Peninsular Malaysia, and so the question which begs to be asked is why heaped extra burden on the industry here?

“The oil palm industry here is very young and this additional insurance scheme will only add to the operating cost and make us even less competitive.”

Soppoa also said any additional steps in the application for work permits would only slow down the processing process, and with the labour shortage here it would make the situation worse.

Soppoa Secretariat said the current practice here required plantation companies to give guarantees to hospitals before their foreign workers could be admitted.

This has worked perfectly well, and the hospitals were fully paid for their services.

“It must be remembered that from Jan 1, 2013, Soppoa member companies must meet the minimum wage salary of RM800 for workers, and so SPIKPA insurance scheme will add to the cost of hiring workers.”

Soppoa added the market price for CPO had dropped drastically in recent months and oil palm plantation companies were losing money due to this.

“The price drop has an especially profound effect on young plantations which have invested heavily in oil palm cultivations.

“It must also be remembered that smallholders as well as plantations will be equally impacted by the introduction of the insurance scheme.

“With all these unfavorable conditions now facing the industry here, Soppoa fully appeals to the government to reconsider the implementation of the scheme.”

The statement went on to state that the oil palm industry was one of the most heavily taxed industries, and yet it had to pay even more.

“It is a fact that many companies took loans to finance their plantations and the low CPO prices, taxes, salaries are driving companies into the red.”

“By right, with the prevailing low CPO prices the government should step in to assist the industry rather than increasing its burden.”

Taken from The Borneo Post