Social security suggestions for an ageing society

LETTER | In our view, a very pressing issue exists over the context of social security safety nets relevant to an ageing society. Given the fact that by 2030 more than five million Malaysians will fall within the 60-plus age demography, the view is that the government ought to embark on an old-age pension payment scheme. Penang MTUC is in complete agreement with this suggestion.

Life expectancy has risen and as a consequence, a sizeable component of the working citizens are from the 60+ age group. Though that being the fact, this segment of society, productive as they remain, are bereft of adequate social security protection.

Yes, they are entitled to EPF contributions at 5.5 percent of their wages plus 6.5 percent paid by the employer as compared to a composite contribution of 24 percent for workers under the age of 60. As for protection, under the Social Security Act, they are only covered under the Employment Injury Scheme and not the Invalidity Pension Scheme.

Thus, a 60+ worker, who is inflicted with an employment-related mishap, can seek redress under Socso but he or she is barred from doing so if the disabling circumstances are not employment-related in spite of the fact that they serve the interest of their employers as well as the nation.

Such inequality, in our view, is a gross deprivation of social security protection to the 60+ working-age population. All workmen, employed in any workplace, must be provided with the same measure of social security shielding. And all legislative discrimination, such as the unjustified lesser EPF contributions and exclusion from the Socso Invalidity Pension Scheme, are, in our opinion, unacceptable.

While a review, of the relevant laws would be appropriate, the government ought to give serious thought to a pension scheme as those who would be entrapped in the 60+ age group, is growing. And as long as one is employed, he or she ought to be accorded equal social security protection be it via EPF contributions or the Invalidity Pension under Socso.

With insufficient EPF savings, no thanks to the low and middle-wage income trap, the 60+ population is left with no option but to continue working to eke out a living in the face of the ever-escalating cost of living. Sadly, social security protection is grossly inadequate for them.

Thinking aloud, we are of the view that the government ought to consider consolidating the EPF and Socso entities in moving forward with devising an old-age pension scheme. Given the fact that these organisations have billions of ringgit at their disposal, the possibilities of developing an old-age pension scheme may well be a possiblity.

Having regards to the prevailing circumstances, Penang MTUC calls upon the government to give consideration to:

1. Implementing a retirement age of 65 years in consideration of the fact that life expectancy has risen;

2. Implementing a uniformed combined EPF contribution of 24 percent for those in employment for the past 60 years so as to eliminate any age-based discrimination;

3. Implementing a standard Employment Injury and Invaidlity Pension scheme for those past 60 years but in employment so as to provide equal protection; and

4. Consider the consolidation of the EPF and Socso entities with a view to devising a pension scheme to cater for an ageing society.

The writer is secretary, Penang MTUC.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.