LETTER | Don't try to loosen 'locked-in' EPF savings

LETTER | We can’t keep beating up a dead horse - I think we have said enough on the Employees Provident Fund (EPF) withdrawal.

Ultimately, we must go back to the original and primary objectives of the EPF. If people need EPF money before their retirement age to make ends meet, something must be very wrong with our economy or our lifestyle.

We should try to fix the economy or our lifestyle, not resort to the easiest way out – taking out our compulsory retirement savings.

Malaysia’s EPF is one of the best retirement schemes in the world. The savings we have are dependent on our employers’ and our own contributions. It was supposed to be a “locked-in” saving with no withdrawal allowed until retirement age.

However, over the years, various withdrawal schemes were introduced, from withdrawal to buy houses and computers to withdrawal for investment. Many of the investments using money from EPF were in fact not providing returns as good as what EPF was able to provide.

In addition to this, we also introduced special withdrawals when faced with economic difficulties, not just once but many times.

Now we even want to use whatever little we have in EPF as collateral for bank loans. Seriously, what difference would this make? If we can’t pay the loan, the money in the EPF would go to the bank.

It is still spending in advance of our retirement savings. It is as if other than EPF savings, none of us have any optional savings for emergencies or to tide over difficult times.

With the ageing population and limited savings due to low wages and repeated withdrawals, I think we have not seriously considered the implications that will hit us a decade or two down the road, not just among B40 but M20 as well.

We are aware that many are faced with a challenging time now. The solution really is to fix the economy, do more to manage inflation, and change our lifestyle to indulge less in lavish spending and save a little more. If we save more, it is also a means of controlling inflation from escalating.

As much as the government must do its part to help the people, I think the people too must take responsibility and manage their own finances.

There is no way the government can keep dishing out free money to the people or allow repeated withdrawals of compulsory savings.

We are not solving the problems but pushing the problems which will only become more protracted in the later dates.

The government must trim down unnecessary projects that benefit a few people and divert the money to doing programmes that are people-centric.

For example, there is no need for another monument, fountain or flower pot in our park or roundabout. Use the money to provide jobs to small contractors to fill up the potholes or clean the clogged drain.

Our official functions or ceremonies should also be more prudent and frugal. We should also trim down a little the entitlement of VVIPs.

All these are good examples that will endear our leaders to the people while at the same time help to divert government money to better use.

We keep hearing the people are facing hardship and the government is incurring deficits and running out of money, but I have not seen any lavish spending, pomp and extravagance reduced.

Sometimes I also feel that people want their EPF money because they want instant gratification, not because they are really in need of the money.

I saw this guy walking 312km in six days to highlight his plight to the government for wanting to withdraw his EPF money.

First, I do not know the amount of money in his EPF account. Second, he should have spent his 6 days working to earn income for his family.

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