In HCM City, increasing number of workers withdraw social insurance premiums

Workers wait to withdraw their accumulated social insurance premiums at the social security agency in HCM City’s Thủ Đức City. — Photo vietnamnet.vn

HCM CITY — Around 37,000 workers in HCM City decided to fully withdraw their social insurance premiums and close their accounts in the first quarter of the year, 19 per cent more than last year, according to the HCM City Social Security Agency.

For their compulsory social insurance policy, employees pay 25 per cent of their salary every month, with the employer contributing 17 per cent.

By paying a premium of VNĐ400,000 ($17.5) a month, for instance, they can get a monthly pension of VNĐ3.75 million ($163) after retirement. They can also get a monthly allowance equal to 60 per cent of their average wage of the last six months if they become unemployed before retirement for a maximum of 12 months.

Thus, the unemployment insurance only provides minor relief.

Phan Văn Mến, director of the agency, told Tuổi Trẻ (Youth) online newspaper that a large number of people from other provinces returned to HCM City, especially in March and April, to find employment after a long time in their hometown to avoid COVID-19.

Many of them were cleaning out their social security accounts to meet their daily expenses, he said.

“When people no longer have a job, they choose to withdraw the money and not pay social insurance.”

City authorities were seeking to stop this phenomenon, but it was only likely to intensify, he said, warning it would not benefit them in the long run and could even harm them.

People receive VNĐ50-60 million (US$2,200-2,600) on average, though some could even get VNĐ300-500 million ($13,000-21,750), “but this amount can only solve their difficulties temporarily,” he said.

Besides, if many quit the social security scheme, it would seriously affect the welfare system, he added.

The welfare system offers financial cover in case of sickness, maternity, workplace accidents – occupational diseases, and retirement.

Besides, once they cancel their policy, they will no longer be eligible for free health insurance after retirement when people suffer from health problems.

Mến said that people should consider carefully before deciding to pull out.

People facing difficulties and unable to pay the premiums could pause for a while and resume payment later, he added. — VnExpress News