Home   |   Contact Us

The Archives

Planters appeal over health insurance plan

Monday, 5 November 2012

MIRI: Oil palm and rubber plantation firms, which are already footing the medical bills of their foreign workers, are pressing on with its appeal to the government to reconsider implementation of the Foreign Workers’ Health Insurance Protection Scheme. 

Since the start of this year, the Health Ministry announced it requires all employers to pay for foreign workers’ medical insurance. Employers who do not comply will not have their foreign workers’ permit renewed by the Immigration Department. 

This add-on scheme to the health screening requirement provides hospitalisation and medical benefits at government hospitals to foreign workers with coverage of RM10,000 a year for all injuries and sickness. 

A total of 25 insurance companies and third party claims administrators are participating in this scheme.

The Health Ministry said this compulsory medical insurance is meant to address the problem of hospital charges owed by foreign workers. It is estimated government hospitals face an annual RM5 million or RM6 million unpaid medical bills incurred by foreign workers. 

So far, foreign workers’ employers in the construction and restaurant sectors are complying with the Health Ministry’s ruling. 

In a telephone interview with Business Times from Miri recently, Sarawak Oil Palm Plantation Owners’ Association (Soppoa) vice-president Paul Wong said this RM120-a-year insurance policy will force oil palm and rubber farmers to pay a further RM50 million to insurance companies.

“Injury-related accident cases are already covered by the Workmen Compensation Insurance. Currently, employers are paying RM72 for each foreign worker. As such, this new ruling mandating us to pay another RM127.20, which include the six per cent service tax, is grossly unjustified. We should not be burdened with additional costs,” he said.

“In Sarawak, we’re already paying the expatriate rate at government hospitals to treat our foreign workers,” Wong said, adding that since plantation companies provide letter of guarantee to hospitals prior to the admission of foreign workers as patients, the question of hospital charge arrears should not arise.

Apart from Soppoa, the Malaysian Palm Oil Association, Malaysian Estate Owners Association, East Malaysia Planters’ Association and Malayan Agricultural Producers Association have also detailed the oil palm and rubber plantation owners’ plight to the government.

Given the prevailing low palm oil prices hovering at around RM2,500 a tonne, Wong said the government should be more mindful, and not further burden planters.

Since the price plunge over the past few months, plantation companies in Sarawak have been losing money as many of the young palms have yet to reach their prime fruit bearing age.

Should the government bulldoze ahead to enforce additional terms and conditions for work permit applications, Soppoa foresee it would worsen the current discouraging situation planters face. 

“With the labour shortage in the state, this will worsen the wastage situation of close to a million tonnes of fresh fruit bunches rotting in the fields,” he said.