KUALA LUMPUR (June 5): The reformation of retirement schemes by the Employees Provident Fund (EPF) needs to go beyond finances and include multi-sectoral aspects such as health and social, said experts.
Beyond finances, a multi-sectoral approach is crucial for formulating effective retirement schemes in the country considering both health and social aspects, according to Prof Dr Shahrul Bahyah Kamaruzzaman, the consultant geriatrician from University of Malaya (UM) and UM Specialist Centre.
“If we are going to look at it only with regards to finances, but not look into the health as well as the social side of things, then it would be inadequate,” Shahrul said.
Numerous models can be emulated by the country in fostering a holistic comprehensive retirement scheme framework such as age-friendly communities and strategies under the World Health Organisation (WHO) framework, or an integrated care model, to name a few, according to Shahrul.
While financial constraints are often central to discussions about retirement and pension frameworks for ageing societies, other social and economic parts of the ecosystems should not be overlooked.
Speaking at the International Social Wellbeing Conference 2024 (ISWC) here on Wednesday, Dr Lee Hwok-Aun, a senior fellow from ISEAS-Yusof Ishak Institute pointed out the need to have "lifelong learning" in response to changes in the labour market situation in the country.
Lee noted that the pandemic has led to a sharp increase in "re-employment" among senior citizens aged 55-64, which raises concerns over time.
“There's been no attention to that phenomenon of rising unemployment among seniors in 2020. That's why I wanted to make sure that we brought it up because we're talking about re-employment [of] older workers in the labour market” Lee told The Edge on the sidelines during the ISWC.
“For now, it's probably back to kind of the more normal situation where unemployment [for the elderly] is very low. But what if another crisis happens? Are we prepared? Are we focused? Does the labour market provide jobs for them?” Lee questioned.
EPF to focus on formulating a multi-tier retirement scheme framework
Meanwhile, EPF chief executive officer (CEO) Ahmad Zulqarnain Onn said his organisation is committed towards reforming the retirement framework.
He emphasised during his closing remarks the urgency of transitioning from a “single pillar” system to a “multi-tier or multi-pillar system.”
“As for today, [we] have a single-filler system and there is a need to add these multi-tier or multi-traditional layers to the system.
"This [is] pressing to do so because time is short [as] you have seen the data [that we] will become an aged nation by 2057,” Ahmad said.
Earlier on Wednesday, Professor Datuk Norma Mansor, the director of the Social Wellbeing Research Centre at the University of Malaya told The Edge the need to adapt the system, with the focus on having a contributory social pension (CSP) scheme.
The mechanism, akin to insurance, allows individuals to receive returns based on their age or upon maturity after 15 years.
Recipients would benefit from basic pension alongside the CSP scheme, in addition to their EPF savings or the Public Retirement Scheme.