‘Support EPF’s retirement-withdrawal age proposal’
KUCHING: Malaysian Trade Union Congress (MTUC) is very disappointed with certain quarters, including ministers, for opposing the proposal to extend EPF’s retirement withdrawal from the current 55 years to 60 years.
In a press release yesterday, MTUC Sarawak Division secretary Andrew Lo said MTUC had fought long and hard for this change to ensure employers cannot force employees to retire earlier than age 60 years.
In addition, increasing the retirement withdrawal age to 60 years was one way to allow contributors to build up sufficient retirement savings, argued Lo.
“The qualifying age for retirement must move from 55 years to 60 years, otherwise it would defeat the very objective of EPF as a savings for retirement and the (move to) increase the retirement age.”
For those who needed part of their funds earlier or planned to retire earlier than at age 60, he said the existing partial withdrawal scheme could remain at 50 years or be extended to 55 years.
“This will give the flexibility to contributors.
“Old age savings is a very serious matter, and we cannot agree to some misplaced, ill-informed, and laughable comments such as ‘EPF is my money and I know what to do with it’ or ‘I should be allowed to withdraw it anytime’.
“Well, if not for EPF, which make it compulsory for you to save up to 11 per cent of your salary each month and also to compel employers to contribute up to another 13 per cent, it is unlikely you have any money in EPF or any other forms of savings for your old age.”
On studies that showed that those who withdraw their savings tended to spent it within three and five years, Lo said if the comments on blogs were true, the money was used to buy diamonds, go for holidays, pay off debts, children’s education, investments, and even children’s weddings.
Then there were those who invested in get-rich-quick schemes and got conned.
“MTUC has no sympathy for them. They are just greedy.”
To those who demanded they be allowed to withdraw their EPF savings to clear their debts and bankruptcies, Lo opined this could lead to them taking higher debts, probably from loan sharks.
In cases where contributors complained that EPF’s dividend was low, Lo asked them to compare with Singapore’s equivalent, which pays just the average banks’ savings interest rates – about two per cent.
“Over the last 60 years, EPF has been one of the best performing pension funds in the world, consistently paying dividends above inflation, meaning contributors enjoy real returns.
“It has demonstrated resilience through financial and economic crisis.
“The average contributor has less than $120,000 in their savings. This is not sufficient to live on until the life expectancy of 79 years. By 2060, 25 per cent of Malaysian will be in the old age group (above 65).
“Who is going to take care of them?
“Everyone wants to be rich before we get old. For the majority of EPF contributors, we get old before we can get rich. The setting of retirement age to 60 is a major step towards a more comfortable retirement. Don’t destroy this dream by insisting on earlier withdrawals.”
Source :[ The Borneo Post ]