Chief Executive Officer of Employees Provident Fund Malaysia (EPF), Datuk Shahril Ridza Ridzuan (2nd from left) together with Deputy Chief Executive Officer (Strategy) of Employees Provident Fund Malaysia (EPF), Tunku Alizakri Raja Muhammad Alias (left), Deputy Chief Executive Officer (Operations) of Employees Provident Fund Malaysia (EPF), Datuk Mohd Naim Daruwish and Deputy Chief Executive Officer (Investment) of Employees Provident Fund Malaysia (EPF), Mohamad Nasir Ab Latif (right) during Employees Provident Fund Malaysia (EPF) Media Briefing ‘Enhancement Initiatives of EPF Scheme’ in Kuala Lumpur. Pix by Aizuddin Saad
KUALA LUMPUR: The Employees Provident Fund (EPF) has announced four proposed enhancement measures to increase members’ retirement savings.
EPF chief executive officer Datuk Shahril Ridza Ridzuan, said a consultation exercise involving members and stakeholders would be carried out to gather feedback on the measures.
The suggestions can be given through a survey on the EPF website or at EPF branches nationwide, for two weeks starting tomorrow.
“We will not make any major changes (to the retirement scheme) before getting feedback from the members and stakeholders.
“The feedback will be then tabled to the board before recommendations are made to the government,” he said during a media briefing to launch its members’ consultation exercise on the four proposals for the EPF scheme enhancement.
The four proposed enhancements are:
* to allign the full withdrawal age with the minimum retirement age of 60.
* to align minimum contributions with the minimum wage legislations.
* to extend dividend payments for members who choose keep their money with the fund, from the age of 75 to 100.
* to introduce Syariah – compliant retirement savings in addition to the existing retirement savings scheme.
On the first proposal, EPF is looking at two options.
The first is to raise the full withdrawal age from 55 to 60, which will be implemented gradually over the space of 15 years.
The second option is to allow the current practice of allowing full withdrawal at the age of 55. Further contributions by the employer from the age of 55 can only be withdrawn upon retirement at 60.
The second enhancement would involve making it mandatory for employers of workers on minimum wage to make contributions not just on their basic salary but on allowances as well.
“This move is to protect members earning less than RM900 a month, which accounted for 30 per cent of the EPF members,” Shahril said.
The fourth enhancement would see members given the option to switch to Syariah compliant retirement savings when introduced. Shahril said EPF will hold briefings to other stakeholder groups, including the Malaysian Trade Union Congress, Malaysian Employers Federation, members of Parliament and government agencies, among others.