KUALA LUMPUR (Feb 16): Deputy Finance Minister Datuk Seri Ahmad Maslan has defended the government’s decision not to allow another round of special withdrawals from Employees Provident Fund (EPF) accounts, stressing that the median savings of contributors have fallen sharply due to such withdrawals previously.
Ahmad said 8.1 million EPF members had withdrawn RM145 billion under the four special withdrawal schemes during the Covid-19 pandemic.
Noting that the median EPF savings of all races prior to the pandemic in 2019 stood at RM16,600, he said it had fallen to RM8,100 in 2022 after the withdrawals.
The median EPF savings of Bumiputeras below the age of 55 dropped significantly to RM4,900 last year, from RM15,500 in April 2020, he said at a press conference in the Parliament building.
Among them, the seven million Malay contributors saw their median EPF savings declining to RM5,500 in 2022, from RM16,900 in April 2020.
“Other Bumiputera members, totalling 1.4 million, were the most affected, with their savings dropping 18% from RM38 billion to RM31 billion, while their median savings declined 70% from RM10,600 to RM3,300,” he noted.
Ahmad also said that the government had received various proposals for the upcoming Budget 2023, including for an increase in the limit on voluntary EPF contributions to RM100,000 a year, from the current RM60,000.
“That is not certain yet. We have to wait for Budget 2023. There are many proposals. This is one of them,” he said.
In the Dewan Rakyat earlier, Ahmad was asked to state the measures the government is taking to increase the EPF dividend rate to rebuild EPF savings at a faster rate by taking into account the long-term investment portfolio strategy and short- and medium-term global economic risks.
“The reconstruction of the member's savings balance is also very dependent on contributions and withdrawals trends of members. The EPF remains committed to continuing to provide competitive returns to contributors in an effort to increase their retirement savings balance,” he said.
Ahmad also updated that as at September last year, EPF’s assets totalled at RM961.1 billion, of which 64% comprised domestic investments and the other 36% were overseas investments.
Breaking down the investments by types, Ahmad said 48% were in fixed income instruments like Malaysian Government Securities, followed by 37% in equities listed on Bursa Malaysia, 4% in private companies (like its 49% stake in QSR Brands (M) Holdings), 7% in real assets, and 4% in money market instruments.
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