Zafrul Rejected Ismail Sabri Request To Allow I-Citra RM 10 000 Withdrawal From Employees Provident Fund (EPF) Accounts

The Employees’ Provident Fund (EPF) should not be seen as a solution or a way to overcome challenges as this will affect the retirement savings of contributors, especially when Malaysia is expected to hit aging nation status by 2030, said finance minister Tengku Zafrul Aziz.

“This means that in eight years, retirees or senior citizens will make up 15% of the population, or 5.3 million people.

“Eight years is not a long time. They are going to need higher savings to support themselves after retirement,” he said in a Facebook post today.

Tengku Zafrul said this in response to the call by some politicians for the government to allow a one-off i-Citra withdrawal of RM10,000 for contributors affected by floods.

The finance minister stressed that EPF savings were meant to help contributors when they retire, and noted that the government had provided various initiatives to help flood and Covid-19 victims.

Up to now, through the i-Lestari, i-Sinar and i-Citra programmes, each EPF member was allowed to withdraw up to RM71,000, with the withdrawals totalling RM101 billion.

Apart from that, the government has also provided various financial initiatives to help the people, such as the RM10 billion Bantuan Prihatin Rakyat (BPR) to help the B40 and M40 income groups, the Covid-19 Special Aid (BKC), and the Loss of Income Aid (BKP) which have benefitted 11 million recipients.

“If we continue to allow withdrawals whenever a disaster happens, the aim of retirement savings will never be realised,” he added. “In the formulation of policy, the government needs to be responsible and to think long term, including (taking into consideration) the well-being of our grandchildren.”

He said the issue of insufficient savings was at an alarming stage and noted that the median savings of the B40 was at RM1,000. If this level continued until their retirement, they would have RM4 a month to spend for 20 years, while for the M40, their savings of RM25,000 would translate into RM104 per month for the same period.

Tengku Zafrul said the government had distributed and expanded financial aid of RM1,000 to flood victims, in addition to other forms of help, such as helping them to buy household equipment and a 50% discount to repair damaged cars.

Umno man slams Zafrul for closing door to more EPF withdrawals

Umno supreme council member Puad Zarkashi has denounced finance minister Tengku Zafrul Aziz for refusing to allow flood victims to make emergency withdrawals from their Employees Provident Fund (EPF) accounts.

“It is very unfortunate that the country has a finance minister who does not care about the rakyat,” Puad told FMT.

“He claimed that those who continue to fight for a one-off withdrawal of RM10,000 through the i-Citra scheme were instigating the rakyat and that the government was already dealing with the floods, including by giving RM1,000 to each affected family.

“But the rakyat’s problem is not just due to the floods. They have endured hardships ever since the Perikatan Nasional (PN) government implemented the half-baked movement control orders.”

The government previously allowed EPF contributors to dip into their savings as an emergency measure against hardship caused by the Covid-19 pandemic. In recent days, several quarters have called for another one-off withdrawal to help flood victims ease their additional suffering.

But Tengku Zafrul has closed the door on any further withdrawal, saying populist calls by “provocateurs” would only lead to burdening the next generation who would have to care for the elderly with no retirement savings.

Puad spoke of the damage to homes and properties caused by the recent floods which swept many parts of the country, and also of the many Malaysians who have yet to get back on their feet after being left with depleted incomes by the pandemic.

He said: “Is Tengku Zafrul confident that those who have lost their jobs will be able to return to work? Have their businesses fully recovered?

“This is not a matter of wanting to be populist. This is about the lives of the rakyat who have fallen on hard times. After losing their jobs due to Covid-19, they are now losing their properties because of the floods.”

He told Tengku Zafrul to start thinking of ways the government could help EPF members increase their contributions instead of repeatedly saying the one-off withdrawal would affect them after retirement.

A total of RM101 billion has been withdrawn by seven million EPF members under three withdrawal schemes so far.

EPF last month warned its members that using pension savings for emergency needs would lead to their having “very low” savings in their retirement years and said the problem could be compounded by other uncertainties such as healthcare costs.

It said the withdrawals had left 6.1 million members – nearly half the fund’s contributors – with less than RM10,000 in their accounts.

Of that number, 3.6 million members have less than RM1,000, a far cry from the RM240,000 the EPF has set as the minimum amount members should have when they reach the age of 55 in order to have a “decent retirement”.

Source : FMT



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    January 10, 2022 at 11:39 pm

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