PUTRAJAYA must not allow any more withdrawals from the Employees’ Provident Fund (EPF) but instead come up with a plan to help the needy, academics said.

They said targeted withdrawals do not solve the financial issues faced by certain quarters and it is the responsibility of the government to help the people with other financial schemes.

They were responding to former prime minister Muhyiddin Yassin who last week urged the government to give its full focus on efforts to develop the country’s economy and to protect the welfare of the people.

Muhyiddin said this included putting the withdrawal of EPF savings and a moratorium on bank loans into consideration.

He said there was nothing wrong with the government considering targeted EPF withdrawals if that is what the people want to tide them over in these tough times.

Deputy Finance Minister Ahmad Maslan, however, said the median savings of EPF members have diminished by half, effectively barring any more withdrawals.

He said 8.1 million contributors had withdrawn RM145 billion from the fund during the Covid-19 pandemic, adding the median savings for those who had withdrawn from their EPF accounts have dropped by 50%.

Academics Barjoyai Bardai of Universiti Tun Abdul Razak and assoc prof Ahmed Razman Abdul Latiff of Putra Business School concurred with the government’s stand on EPF withdrawals.

Barjoyai questioned who would benefit more from targeted EPF withdrawals – the rich or the poor?

Razman said targeted EPF withdrawals solve nothing and the government should be the one providing the assistance.

“Who is the target? Those with enough savings or those with limited savings? If for those with enough balance, do they really need the money? Or are they going to use it for holiday trips?

“If it is for the needy, do they have enough money? There are 7.1 million people who have less than RM5,000 in their EPF savings. Should they be allowed to take it all out or half? Is that enough? Will that help them settle their problems?” asked Barjoyai.

“There is no need or urgency for the government to allow another withdrawal. Those who push for EPF withdrawals have their own political motives,” he added.

Prime Minister Anwar Ibrahim recently said the government will have to consider the plight and future of EPF contributors before they are allowed another round of special withdrawals.  

He said it was better for the government to look for other more effective options to help those impacted by or who had lost their source of income due to the Covid-19 pandemic.  

He added that most contributors had minimal savings and if the government allowed more withdrawals, it would affect the future of the contributors.  

Razman, meanwhile, said the government made the right move by not succumbing to pressure from the opposition on this issue.

“The money should not come from the people’s own pockets. It is the government who should provide the assistance.

“There are a lot of schemes provided. Maybe they need to intensify the promotion so that people know where and how to get assistance,” he said.

Under the past two government administrations, four tranches of EPF withdrawals were allowed in two years to tide Malaysians over during the Covid-19 pandemic.

EPF members were allowed to withdraw a further RM10,000 last year, following the launch of the i-Lestari and i-Sinar schemes in 2020, and i-Citra in July 2021.

Do what’s best for the people

Nadzim Johan of Persatuan Pengguna Islam Malaysia said the government should do what is best for the people.

He hoped Anwar would think of effective solutions that would help those have been adversely affected by the challenging economic climate.

“We are not saying we agree and we are also not saying we disagree (to EPF withdrawals). The thing is there are people in need and targeted assistance can really make a difference,” he said.

“If the government says EPF is not the solution, then allow Pusat Zakat or any other body to give out aid without bureaucracy or unnecessary conditions.

“People are struggling with mental health issues, some have gone through a divorce, some attempted suicide. So more attention is needed,” said the activist. – February 23, 2023.