Goodbye TFR (Severance Indemnity Funds)


Those employees that left their severance indemnity funds with the company, have seen them grow by 3,5%. Instead, those who listened to, and took the advice of the trades union, the political parties and the financial brokers and proceeded to invest their severance indemnity in pension funds, have incurred a loss of about 20%. And this is merely the beginning. With the Stock Exchange heading downhill fast, these future pensioners will find that their severance indemnity will buy them little more than their morning cappuccino coffee and seed for the pigeons. The trades union, Confindustria, the Political Parties and the Banks have managed to swallow up yet another of the little nest eggs. The average citizen has virtually nothing left for these guys to grab. All they can do now is cut the funding destined for services, Education, the Police Service and Healthcare, until we hit rock bottom like at the time of the Argentinean investment crash.

"If you are employed in the private sector and say nothing until the end of June, your severance indemnity will land up in the managed funds. That would be enough to give you heart palpitations. For the past twenty years the mutual funds have been losing people’s money. Now the pension funds are ready to repeat the same disasters. Tacit consent is nothing more than a trap. They change the cards on the table without asking your permission. It is much like betting your life’s savings on one round of the old “under which shell is the pea” game. The claim that these funds will provide supplementary pension benefits are false: all they do is hand over your severance indemnity to the mutual fund industry." Beppe Grillo, 6 June 2007.

Read the letter written by Beppe Scienza, mathematician and expert in the field of savings and supplementary pension benefits.

Three million Italians in jail, by Beppe Scienza
"For the Italians, supplementary pension benefits have become like a prison. The trade unionists and regime economists (Marcello Messori, Giuliano Cassola, Elsa Fornero, etc.) have pulled the wool over the people’s eyes with regard to these pension funds. Around three million Italians gave up their Severance Indemnity Funds and now find themselves locked in for good. Worse still, they have been taken for a ride by parties that simply wanted to get rich quick at the workers’ expense, such as the Anima fund management company, which had the audacity to claim that: “Investing in a pension fund is the intelligent choice”. We now know precisely what kind of choice it actually was: one hiding after another since the summer of 2007.
The trap was sprung in June last year. Since then, things turned bad, only to get worse in 2008. The chemical workers know all about this since their fund (the Fonchim Fund), in September, posted a loss of 14,8% since the beginning of the year, as do the metal industry workers, whose fund (the Cometa Fund) has lost 10%, and the railway workers’ fund (the Eurofer Fund) with a deficit of 17%. These are perhaps the worst cases due to the losses incurred by the stock-linked options, however, the other funds have also done worse that the Severance Indemnity Fund.
However, the worst part is the loss of individual freedom. For those people who moved into the pension funds at the insistence of the trades union, this is tantamount to a life sentence. As long as these people continue to work, their severance indemnity will continue to flow into these funds, whether they like it or not. Even by going on pension will only mean semi-freedom. These workers will not be able to draw half of whatever amount is left over (the so-called capital portion) because this will be converted into a monthly income, with the associated conditions being decided by others.
Unfortunately they will not even be able to hope for any concession by the Head of State, because there can be no such concession with regard to supplementary pension benefits. If nothing else, however, at least they can change cell every two years. In other words, they can move from a share-linked option to a guaranteed option within the same fund. Pity that this so-called guarantee is nothing more than propaganda, what with the “guaranteed” options having shown a loss of 3% since the beginning of 2008 (see the Fonchim Fund)! If they so wish, they can even change prison, in other words, not only the management option, but also the fund. They cannot, however, buy back their freedom: after all, a life sentence is a life sentence!
The only ones that remained free are those that left their Severance Indemnity where it was. These people are now happy and safe, watching their money grow day by day (around +3,5% since the beginning of 2008). If they change jobs or go on pension they receive all of their money immediately and they are free to do whatever they like with their payout.
Therefore, those that took the advice that Beppe Grillo and I, or even the Famiglia Cristiana Magazine gave at the time, did the right thing.
But wait! Apparently the gall of the trades union knows no bounds. Not satisfied with the loss of face they suffered in terms of the schools (the Espero Fund), just a few days ago Cgil, Cisl, Uil, and others held a meeting with a view to starting up yet another two such funds covering the entire public sector (the Sirio and Perseo Funds). This has got to be some sort of a joke." Beppe Scienza

Posted by Beppe Grillo at 04:59 PM in | Comments (5)
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I have over the years taken care of my own investments and capital. Since 1997 I have refused to have anything to do with stock markets and any financial institution. I have been bombarded by a multitude of such institutions bowling themselves over to get their paws on my capital to gamble in stock markets. They have made promises of get reach quick deals and astronomical percentage growth. The latest offers were until the middle of last year from Barclays bank offering the "increadible" product of sub-prime investments. Although they kept pestering me 3/4 times a week with promises of the highest returns I desisted and pointed out to their financial specialists that since 1997 I have had no trust whatsoever of the stock markets. The Enron case and many other similar cases were proving my point. Then, soliciting to get my funds stopped suddenly and the sub-prime debacle has collapsed the whole financial system.
Meanwhile I have kept the capital on 90 days call and have accrued not great returns but the capital has remained intact.
Of course there is the possibility of the bank going bust but then if this happens will mean that money in whatever form will have no value anyway.
Good luck to all for a bright future!!!

Posted by: Maurizio Odello | October 27, 2008 09:49 AM

Perhaps the pensioners could go window cleaning in Milano! :D

Posted by: Rolly Wheeler | October 26, 2008 08:22 AM

Dear Lou Pacella. if you live in USA, don't worry, probably your BUM is already bleeding... You don't need either Berlusconi or Veltroni or Unions. You are well set-up. You have Mr.Bush. Oh what a feeling!

Posted by: Delfi Marigo Spitaleri | October 26, 2008 05:23 AM

there is a guy named Di Pietro who founded a party called Italy of the Values. The guy's all the rage among Grillo bloggers. It's a bit like calling the party Manure of the Perfumes - an exquisite oxymoron.

Posted by: Giacomo C. | October 26, 2008 12:45 AM

I thought I heard an Italian minister say that his government is about to bail out small businesses. The minister is using taxpayers' money to provide a free lunch to small businesses. There are millions of Italians that will soon be out of work and their economic future looks mighty bleak. Will all of these people be taken care of in the same way that small business owners are? Will the money be given nilly-willy to any and all businesses? What do Italians mean by "small business?" Will the money end up directly in the pockets of the owners? Marcegaglia was on TV pleading for government handouts. It's time for union leaders to go on TV and demand that government take care of their members. After all, it's their money. If this economic crisis going to define anything it will be how public money will be spread around. I gotta a feeling Italians are going to get screwed again -big time.

Posted by: Lou Pacella | October 25, 2008 10:20 PM

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