Umno's insistence of another round of Employees Provident Fund (EPF) withdrawal was due to the position taken by the party's supreme council last August which has not been withdrawn.
In a statement, Umno Youth chief Asyraf Wajdi Dusuki said the position taken by the supreme council serves as a guide for Prime Minister Ismail Sabri Yaakob, who is also Umno's vice-president.
Asyraf (above) was responding to Finance Minister Tengku Zafrul Abdul Aziz who questioned the motives behind those who insisted on allowing another round of withdrawals of up to RM10,000.
According to Zafrul, the move was unfeasible since half of EPF contributors already had less than RM10,000 in their EPF accounts.
On August 27 last year, Umno president Ahmad Zahid Hamidi had urged the government to review a decision to not conduct another round of withdrawals.
At the time, Malaysia was facing another severe wave of Covid-19 infections, resulting in the third movement control order (MCO).
Calls for a fresh round of EPF withdrawals below retirement age was re-emerged after massive flooding in parts of the Klang Valley and Pahang last month.
Zahid, his predecessor Najib Abdul Razak and Asyraf have been among the most vocal proponents of EPF withdrawals.
They argued that some flood victims have no other options to finance post-flood recovery.
EPF's assets were worth RM925 million as of Dec 31, 2019. At the time, EPF's portfolio consists of fixed income instruments (49 percent) followed by equities (39 percent), money market instruments (7 percent) and real estate (5 percent).
By end 2020, EPF's assets had crossed the trillion ringgit mark. However, billions had been withdrawn by the public for various Covid-19 assistance programmes since 2020.
According to Zafrul, supporters of more EPF withdrawals schemes will hurt the bumiputera, as they make up the bulk of EPF members with less than RM10,000 in their accounts.
This, said Zafrul, would cause future problems because many members will not have enough money to retire.
He added that reducing EPF's fund size will also reduce dividends for members and has a known impact on the bond and stock markets. - Mkini
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