Keep withdrawal option at 55, Institute tells EPFk

Kuala Lumpur: The Asian Strategy and Leadership Institute (Asli) welcomes the Employees Provident Fund's (EPF) newly proposed enhancement and improvement initiatives as long as the pension fund provide the flexibility for members to withdraw their savings at the age of 55.ASLI director Tan Sri Dr Ramon Navaratnam said with the flexibility, EPF members should be able to opt out at the age of 55 or later at their own choice.

"As long as the proposal is on a voluntarily basis it should be okay.

"I am glad that all the measures introduced are still at the consultation level, and seek feedback from members and related stakeholders before it makes a decision," he told Bernama Monday.

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The EPF Monday announced four proposed enhancement measures, which are still at the consultation exercise, including to align the full withdrawal age with the minimum retirement age of 60 and to align minimum contributions with the minimum wage legislation.

The fund also proposed to extend dividend payments for members who choose to keep their money with the fund, from the age of 75 to 100, and introduced Shariah-compliant retirement savings in addition to the existing retirement savings scheme.

Members are given two options for the withdrawal age, either to raise the full withdrawal age from 55 to 60 (to be staggered over 15 years) or continue with the current practice of allowing full withdrawal at the age of 55 and created another account for saving between the age of 55 and 60.

Ramon commended the EPF's move to introduce the Shariah-compliant savings scheme and lauded the fund's approach to consult members before making a decision but urged the fund to give serious attention to the people's decision.

He suggested the EPF to be practical in implementing the measures, especially in extending the dividend payment from the age of 75 to 100 years.

"It is good to extend the payments as it would allow the fund to buy more government securities and help reduce government debts, but how many people could live to that certain age with their money still intact?" he said.

Meanwhile, the Federation of Malaysian Consumers Associations (Fomca) was against the proposal to align the full withdrawal age with the minimum retirement age as determined by the government.

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"We welcome any new initiative which will improve the existing scheme and benefit the workers, however, they (public) are concerned about public fund management as well as government debt rumours. After all, its their money," Fomca president Datuk N Marimuthu said.

He also urged the Employees Provident Fund to extend its consultation exercise to the Malaysian Trades Union Congress (MTUC) as well as consumer associations to get better feedback. – Bernama

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