Putrajaya gives nod for special EPF withdrawal of RM10,000

Putrajaya gives nod for special EPF withdrawal of RM10,000

KUALA LUMPUR (March 16): Prime Minister Datuk Seri Ismail Sabri Yaakob on Wednesday (March 16) has announced that the government has agreed to allow a special Employees Provident Fund (EPF) withdrawal of RM10,000.

This was after the Bera MP said the government had listened, studied and scrutinised the requests from all parties to withdraw the EPF contributions.

“The government had previously allowed the withdrawal of EPF contributions through three schemes, namely i-Lestari, i-Sinar and i-Citra amounting to RM101 billion, involving 7.34 million contributors since the Covid-19 pandemic hit the country two years ago.

“Based on the findings of comprehensive studies and research in the recovery phase after this pandemic, there are, among Keluarga Malaysia, those who are still affected by the economy, loss of income, and are rebuilding their lives,” he said in a brief live press conference telecast.

According to Ismail Sabri, further clarification on this special EPF withdrawal will be made by the Ministry of Finance and the EPF.

“This is a difficult decision as it involves people’s old age savings and this special withdrawal is a middle ground in balancing between today’s urgent needs and future savings.

“Although the government has given permission for this special EPF withdrawal, I appeal to contributors to maintain their savings unless the situation is really urgent.

“I hope the contributors make due consideration before making a withdrawal, for the sake of their future,” he added.

Following the announcement by the prime minister, Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz said the details of the withdrawal will be revealed by EPF in the near future.

“The EPF will also announce the necessary measures to address the issue of declining EPF members' retirement funds,” he said in a brief statement.

Earlier in the week, Tengku Zafrul had disclosed that the EPF dividend rate should have been higher at 6.7%, compared with the 6.1% announced recently, if there were no outflows of savings by its members.

He said an additional dividend of RM5.4 billion could be distributed to all EPF members if previous withdrawals were not made.

In Parliament on Monday, Tengku Zafrul also cautioned that the EPF will have to dispose of more overseas investments, as well as halt domestic investments in the short to medium term if another RM10,000 withdrawal is to be allowed, which will have serious implications in the long run.

He warned that a withdrawal of up to RM10,000 for 6.3 million eligible members will add up to a total of RM63 billion, and will require the EPF to rebalance its portfolio to accommodate the withdrawal, which would likely drive the total impact beyond RM63 billion.

http://www.theedgemarkets.com/article/pm-ismail-sabri-says-government-had-wednesday-agreed-allow-special-epf-withdrawal-rm10000