EPF savings low and worrying, MOF says after withdrawal schemes

 

The impact of the Covid-19-related withdrawal programmes on the Employees Provident Fund (EPF) members' savings is estimated at RM155 billion, the Dewan Negara was told today.

Deputy Finance Minister 1 Mohd Shahar Abdullah said RM145 billion was withdrawn by members under the four withdrawal programmes and almost RM10 billion was from the impact of the reduction of the employees’ share statutory contribution rate.

"The level of savings of EPF members is low and very worrying especially after the implementation of four withdrawal facilities related to Covid-19 namely the i-Lestari, i-Sinar, i-Citra and special withdrawal; and the reduction of the employee share statutory contribution rate for a period of 27 months (April 2020 until June this year)," he said.

He was replying to a question from Senator Razali Idris on measures to help EPF contributors who have savings less than RM10,000.

As of June 30, Shahar said a total of 6.62 million members or 52 percent of the total of 12.78 million EPF members aged under 55 had savings of less than RM10,000.

Of that total, Shahar said 4.99 million members or 75 percent were bumiputera.

“At the same time, there are 3.2 million members under the age of 55, who are at a very critical savings level of less than RM1,000, and 2.58 million members or 81 percent of them are bumiputera.

Bumiputera members make up 64 percent or 8.22 million of the total 12.78 million members of the retirement fund aged below 55, he added.

“This shows that bumiputera members made up a large proportion of EPF members with low savings levels compared to other races,” Shahar said.

- Bernama