3 Jan - 3 min read
Finance Minister, Tengku Datuk Seri Zafrul Abdul Aziz has reiterated that the Employees Provident Fund (EPF) should not be seen as a solution to challenges, as it will adversely affect the retirement savings of Malaysians.
Speaking in a video to address comments and calls to enable another round of EPF withdrawals via i-Citra due to the floods that hit several states in Malaysia recently, Tengku Zafrul gave various points and statistics to highlight the detrimental effects of another round of withdrawals while at the same time reminding the public that the Government is already providing various financial aids to flood victims of up to RM61,000 per household.
Tengku Zafrul noted that EPF withdrawals were only enabled as a short-term measure to provide immediate financial assistance due to Covid-19, an unprecedented event that affected the whole world, but the EPF should not be seen as a solution to every challenge the country faces. In addition, he also noted that the government did not enable EPF withdrawals back in 2014 when the country faced a similarly devastating flood.
“The purpose of the EPF is none other than the preparation for old age, when the ability to continue working diminishes. It is important to know that the rakyat has retirement savings because not long from now, in the year 2030, Malaysia is expected to hit the status of an ageing nation. In just eight years from now, the amount of retirees and elderly will comprise 15% or more than 5.3 million of the population,” he said.
Since the three EPF withdrawal facilities were launched, EPF members were allowed to withdraw up to RM71,000, and in total, EPF members have withdrawn over RM101 billion from their retirement savings. Tengku Zafrul stressed that more withdrawals would further affect the issue of the lack of retirement savings which is already at worrying levels.
Further, Tengku Zafrul also noted that many EPF members would not be able to make any further withdrawals anyway as they do not have enough minimum savings to withdraw. Almost 50% or around 6 million members have EPF savings below RM10,000, which means they do not qualify for i-Citra withdrawals.
According to Tengku Zafrul, the Government is providing various financial aids to assist flood victims, including a RM1,000 cash aid under Bantuan Wang Ihsan (BWI), a RM500 voucher to purchase electrical appliances, car and motorcycle repair aids, a RM10,000 loan at 0% rates with an immediate 6-month moratorium, and several others.
(Source: The Edge)
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