The government’s decision to allow Employees Provident Fund (EPF) contributors to withdraw up to RM6,000 from their accounts has generally received the thumbs down.
EPF contributors are questioning the need to touch their retirement savings after Putrajaya allowed withdrawals from the fund to cope with the economic impact of the Covid-19 pandemic.
They told The Malaysian Insight that it is the government’s responsibility to help its citizens in times like these.
It is a national problem, they said, adding that asking the public to touch their savings is not a solution.
A bank officer, who only gave her name as Christina, disagreed, saying that it is ridiculous for the public to use their savings during a pandemic.
“I will not use my EPF money. This saving is meant for retirement. It is ridiculous to use our own savings.
“The government should do something to help because it is a national problem,” she said.
Christina said Malaysia should follow Canada’s footsteps, which recently unveiled a US$56.4 billion (RM251 billion) stimulus package to help people buy groceries and pay rent.
Manivannan Letchumanan, an IT manager, also rejected Putrajaya’s initiative of taking funds from his EPF.
“I will not be taking out my money. This is not even a solution. This is forcing us to use our money.
“Maybe the government can exclude the B40 from paying rental, utility bills for let’s say, two months. They can use the money they save to buy essentials,” he said.
Vincent Lim, a legal counsel, and Mohd Rusid, an engineer, said they won’t touch their EPF funds.
“EPF is meant to be a retirement plan. Sound financial planning would have prepared oneself for an emergency like this,” Lim said.
Rusdi said the RM500 would not do much to help either.
“The situation is bad, and I don’t think RM500 would do much. My house loan repayment alone is RM1,800. Total expenses, including everything for a family of four, come up to RM4,000 monthly.
“So, if employers decide not to pay us, what happens? Is RM500 sufficient?
“Instead of asking us to take money, they must be able to contribute. The government has money. The ministers should take a pay cut or work without salary for at least six months,” Rusdi said.
Teh Kit Yinn, a part-time worker and full-time PhD student, painted a more ominous picture.
“This shows that Putrajaya is unsure when the Covid-19 crisis will end.
“It can be seen as the government not knowing how long this pandemic will last. So, this is a move to increase buying power.
“Maybe, but in times of uncertain economic crisis, supermarkets have always been built to increase cash flow in markets. That is how I view why the government took this move.
“However, an aid scheme will definitely help, especially for the B40 group,” said the molecular biology student.
Ng Suzhen wants the government to use the bantuan sara hidup (BSH) scheme for the lower-income group.
The 36-year-old private sector worker said the government must come up with a proper plan so everyone could get the help they need.
“To be honest, BSH is necessary for the lower-income group. I would agree that it be provided to them, and not for those who are capable of surviving on our own.
“Those who can afford should not take advantage of funds meant for those who need it, especially in times like this.
“The government needs to plan this out properly so everyone is able to get the help they need and not just throw ideas around without proper implementation,” she said.
However, some from the bottom 40 (B40) group agreed with Prime Minister Muhyiddin Yassin’s suggestion and said this is a way to help a cash-strapped government.
Even so, they pointed out that RM500 will not be much help.
Yesterday, Muhyiddin said EPF account holders aged below 55 can access their savings to pay for daily necessities under new measures to help people cope with the economic impact of Covid-19.
Withdrawals of up to RM500 a month for a maximum 12 months are permissible from Account 2 beginning April 1.
Meanwhle, the Malaysian Trades Union Congress (MTUC) sees it as “robbing” from one’s own savings, while the Malaysian Financial Planning Council (MFPC) warned that it could open a Pandora’s Box, and a former minister wants the government to review the proposal.
MTUC secretary-general J Solomon said the EPF savings was a worker’s safety net and it would be immoral to use those savings to cope with the financial impact of Covid-19.
“The government should have the moral courage to dig into its own reserves to pump money into the pockets of workers without having to compromise their old-age savings,” he said in a statement yesterday.
He said the government could help those affected by the economic impact of Covid-19 by giving them interest-free loans.
MFPC deputy president Dr Desmond Chong said the move could backfire on those who use the money for investments.
“While it is good for those who have zero savings and not enough money to survive, others may see it as an investment opportunity.”
He said with the market fluctuating, this would be a risky proposition. In the end, the contributor may have to work longer to accumulate the same amount of money.
Former Domestic Trade and Consumer Affairs minister Datuk Seri Saifuddin Nasution Ismail said the proposal would defeat the purpose of having the retirement fund.
“Even now, most Malaysians do not have enough in their EPF savings to sustain themselves after retirement.”
Saifuddin, who is also PKR secretary-general and Kulim-Bandar Baharu MP, said about 70% of EPF contributors have enough to last them only five years after retirement.