The Malaysian Employers Federation (MEF) has called for a stop to schemes allowing EPF members to dip into their retirement funds, saying the government should think of other means of assisting those reeling from the financial impact of Covid-19.
In a statement, it voiced concern that the withdrawals made through the i-Lestari, i-Sinar and i-Citra facilities provided by the government throughout the pandemic had put people at risk of falling into old-age poverty.
“The government must think of other schemes to assist them rather than withdrawing from the EPF savings meant for old age requirements,” MEF president Syed Hussain Syed Husman said.
“This responsibility cannot be passed to individual employees. As citizens, during their prime life and career, they have contributed a lot to the nation. It’s the nation’s role to take care of them when they retire.”
The group also called for a review of the current policy allowing members to withdraw a third of their savings upon reaching 50 years of age and everything once they turn 55.
Citing the decision to raise the retirement age from 55 to 60, it said it was no longer relevant for EPF to allow members to withdraw their savings once they reach 55.
The i-Lestari, i-Sinar and i-Citra facilities were part of the various aid packages announced by Putrajaya to cushion the financial impact of Covid-19.
Last month, former prime minister Najib Razak urged the government to raise the maximum amount for withdrawal under i-Citra to from RM5,000 RM10,000.
He said this was not a populist move, adding that it stemmed from the urgent need of the people post-pandemic.
“I found that many people have voiced and pressed (on this matter) as they actually have arrears that must settled or have plans to raise capital to start a small business.
“I really hope the maximum (withdrawal) for i-Citra can be increased to RM10,000 as the last special withdrawal scheme as this is demanded by the people,” he said during the debate at the policy level of the Supply Bill (Budget) 2022 in the Dewan Rakyat.
But MEF said it was worrying to note that only 3% of Malaysians had enough to retire comfortably.
“It is very clear that there is an urgent need for far-reaching solutions covering effective social safety net programmes, robust labour market policies, sustainable economic growth, reskilling and upskilling of the labour force, as well as policies to encourage automation and digitalisation to help increase productivity and make the economic cake bigger so that employees have a better chance of earning more, thereby increasing their contributions to the EPF,” Syed Hussain said.