KUCHING: The Sarawak Malaysian Trades Union Congress (MTUC) has cautioned against allowing workers to withdraw money from the Employees Provident Fund (EPF) Account 1.
The chapter’s secretary, Andrew Lo, said EPF cannot be a “cash cow” to compensate for the government’s “inadequacy and inability” to assist millions of private sector employees.
“We must not sacrifice our retirement savings for immediate gratifications.”
However, MTUC’s national deputy president, Mohd Effendy Abdul Ghani, previously welcomed the government’s move to allow withdrawals of RM500 a month for a 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 contributors in need of funds to lessen the financial turmoil caused by the Covid-19 pandemic.
Allowing EPF withdrawals, he said, would see the retirement fund missing out on the opportunity to invest in high-quality assets with low valuations.
“This will impact EPF’s future earnings and quality of investments, and compromise dividend payouts,” he said, adding that it would affect EPF’s ability to serve its main purpose of providing retirement funds for contributors.
Lo also said the insufficient funds in many contributors’ Account 1, as highlighted by Finance Minister Tengku Zafrul Aziz, was an indictment on the government’s low wage policy for the past 60 years.
“In most countries, people get rich before they get old. Malaysians get old before they get rich. The private sector employees do not have a pension when they retire, unlike civil servants, ministers and MPs,” he said.
FREE MALAYSIA TODAY