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KUCHING: The Sarawak Malaysian Trade Union Congress (MTUC) has warned against allowing workers to withdraw money from Account 1 of the Employee Provident Fund (EPF).
Chapter Secretary Andrew Lo said EPF cannot be a “source of income” to make up for the “inadequacy and inability” of the government to help millions of private sector employees.
“We should not sacrifice our retirement savings for immediate perks.”
However, MTUC National Vice President Mohd Effendy Abdul Ghani welcomed the government’s move to allow 500 ringgit withdrawals a month for one year.
Lo’s comments come in the wake of reports that EPF will have to liquidate its assets and rebalance its portfolio to make billions of ringgit available to taxpayers who need funds to lessen the financial turmoil caused by the Covid pandemic. 19.
Allowing EPF withdrawals, he said, would make the retirement fund miss the opportunity to invest in high-quality assets with low valuations.
“This will affect EPF’s future earnings and the quality of investments, and will compromise dividend payments,” he said, adding that it would affect EPF’s ability to fulfill its primary purpose of providing retirement funds for taxpayers.
Lo also said that insufficient funds in Account 1 of many taxpayers, as highlighted by Finance Minister Tengku Zafrul Aziz, was an indictment against the government’s low-wage policy for the past 60 years.
“In most countries, people get rich before they grow old. Malaysians get old before they get rich. Employees in the private sector do not have a pension when they retire, unlike civil servants, ministers and parliamentarians, ”he said.
