Wednesday 17 Apr 2024
main news image

KUALA LUMPUR (Oct 7): The Employees Provident Fund (EPF) had in 2021 recorded its first negative net contribution in 20 years at RM58.2 billion as members withdrew funds from their EPF accounts to cushion the impact of Covid-19 pandemic movement restrictions which began in early 2020, according to the EPF's chief executive officer Datuk Seri Amir Hamzah Azizan.

"As (Covid-19-driven) lockdowns continued to spill over into 2021, multiple small businesses were severely impacted, with many having to cease operations, thus causing widespread job losses. As an immediate effort to sustain the livelihood of our members, we introduced i-Citra in July 2021 which allowed members to withdraw up to RM5,000," Amir Hamzah said in the EPF's latest annual report for 2021.

"Even though in 2021 we recorded our first ever negative net contribution (contributions after withdrawals) in 20 years of RM58.2 billion due to the pandemic-related withdrawals, we were able to maintain a healthy cash balance at the end of the year while delivering dividend rates that were above expectations," he said.

Amir Hamzah said EPF had made a total 2021 dividend payout of RM56.72 billion to members.

He said the EPF declared a dividend rate of 6.1% for Simpanan Konvensional, with a payout of RM50.45 billion besides a dividend rate of 5.65% for Simpanan Shariah for a payout of RM6.27 billion.

The EPF's Simpanan Konvensional for members is also known as the Conventional Savings scheme while Simpanan Shariah is an Islamic-compliant savings programme.

"For the most part, our performance for the year was largely attributable to our approach to diversification as guided by our strategic asset allocation, which has kept the EPF resilient to financial shocks and challenges in unprecedented situations.

"Our investment team was also firm in aligning our strategies with global economic recovery efforts supported by (Covid-19) vaccination rollouts, as well as fiscal and monetary policies that played a key role in buttressing economic activities and growth," he said.

Looking back, Amir Hamzah said the Covid-19 pandemic had a profound impact on lives and livelihoods, forcing upon global communities a disruption on a scale not seen before.

He said the disruption resulted in far-reaching social and economic consequences for Malaysia, hence, necessitating Covid-19-driven responses such as allowing EPF members to withdraw money from their EPF accounts to cushion the impact.

"Although these responses were necessary in light of the situation, the pandemic-related withdrawals worsened the future situation for our members, many of whom now face the risk of having insufficient funds to live a dignified retirement.

"As the country’s largest retirement fund, we are deeply concerned by this situation as it will not only be detrimental to individual livelihoods, but also impact the socioeconomic landscape of the country and its fiscal health.

Edited ByChong Jin Hun
      Text Size