KWSP - RM101 Billion Withdrawals affected ALL members - If no withdrawal, dividends 6.7%, now only 6.2%?

KWSP/EPF does not keep the monies  contributed by workers/employers, which all belongs only to the worker. KWSP does not keep this worker's monies in a bank(or in boxes).

KWSP invests the monies, be it in shares/stocks/unit trust and even in property - all done for the reason to GENERATE profit, which will flow back to the worker KWSP account holder. How much profit made is then given back to the EPF account holders in the form of DIVIDENDS - In 2021, the dividends was 6.2% - that means if your account had RM10,000, 6.2% more will be added on, and now your EPF account balance will be RM10,620-00.

So, when KWSP account holders make withdrawals, KWSP may be forced to speedily sell of properties, shares/stock/unit trusts in Malaysia and overseas to generate that monies to pay the worker-KWSP account holders > and this will affect the profits(Dividend) for every account holder.

This will be the fourth withdrawal after i-Lestari and i-Sinar in 2020 and i-Citra in July 2021, to meet the urgent cash flow needs of members during the periods of the movement control orders (MCO) and the subsequent economic slowdown...As of end 2021, a total of RM101 billion had been withdrawn under the first three facilities.

Because of this RM101 billion withdrawal, every EPF worker members suffered. Consequence, we all only got a 6.1% dividend, and not a 6.7% dividend.

The EPF recently announced a 6.1 per cent dividend for conventional savings for 2021, one of the highest to date, but Zafrul said it could have been as high as 6.7 per cent if previous unprecedented Covid-19-related withdrawals were not allowed...This would have meant RM5.4 billion in terms of additional dividend could have been distributed among EPF members.

If an EPF member had RM10,000 in their account - they just lost RM60 in dividends. If you had 100,000, you lost RM600... and that is significant.

And now the government is again allowing another EPF withdrawal of RM10,000 per member. Members are allowed to withdraw a maximum amount of RM10,000 and a minimum amount of RM50, and must fully utilise their savings balance in Account 2 first before accessing their Account 1. Today’s decision came as a surprise since Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz had indicated hesitancy to allow the withdrawal. Another one-off RM10,000 facility could amount to RM63 billion if all 6.3 million eligible were to make the withdrawals, the minister told the Dewan Rakyat on Monday.

Worse, now they are even allowing EPF members to take out monies from Account 1 - so, what happens in old age for the worker. They do not get monthly pension like public officers... after they retire. And the monies in KWSP/EPF must be enough to take care of the worker's livelihood until the day he/she passes away - which maybe 30 years. There must be sufficient money that takes into account the rising cost of living.

HENCE, the Malaysian government recent decision to again be able to take out RM10,000 from worker's old age savings is simply WRONG and uncaring for private sector workers and the self-employed.

To assist workers, the GOVERNMENT must use government monies - not just simply allow the worker to take out prematurely from the Worker's OLD AGE SAVINGS.

When the OLD AGE worker has no monies to live, will the Malaysian government take care of him/her? If yes, then enact a law and set up a FUND that will protect workers in their old age. Better still, implement a PENSION SCHEME, which will pay out monthly payments at least the Minimum Wage to the worker until the day he/she dies.

REMEMBER that all workers, not just the public sector workers, contribute to the development of Malaysia, and so, the government is duty bound to protect ALL workers and their families.

EPF issues sombre reminder of retirement crisis risk ahead of another special withdrawal on April 1

Wednesday, 16 Mar 2022 07:12 PM MYT

BY SYED JAYMAL ZAHIID

Prime Minister Datuk Seri Ismail Sabri announced earlier this afternoon that the government has agreed to allow a last withdrawal of up to RM10,000, saying the decision was based on growing public demand that the programme be extended. — Reuters pic

KUALA LUMPUR, March 16 — The Employees Provident Fund (EPF) issued a stern reminder that the country could be staring at a retirement crisis just hours after Prime Minister Datuk Seri Ismail Sabri Yaakob greenlit another withdrawal facility to help people cope with the Covid-19 fallout.

The pension fund said this should be “the last” special withdrawal initiative as it reiterated its concerns around members’ retirement adequacy.

“As the country rebuilds the economy and more people have returned to work, the EPF believes that this should be the last facility allowed under the special withdrawal initiative,” the fund said in a statement.

“The EPF would like to reiterate its concerns around members’ retirement adequacy and hopes this will be a precursor towards the rebuilding of retirement savings and reforming of the nation’s social security system.”

Ismail Sabri announced earlier this afternoon that the government has agreed to allow a last withdrawal of up to RM10,000, saying the decision was based on growing public demand that the programme be extended.

This will be the fourth withdrawal after i-Lestari and i-Sinar in 2020 and i-Citra in July 2021, to meet the urgent cash flow needs of members during the periods of the movement control orders (MCO) and the subsequent economic slowdown.

As of end 2021, a total of RM101 billion had been withdrawn under the first three facilities.

EPF said application for the special withdrawal facility will be opened to members below age 55 starting April 1, 2022 and ending on April 30, 2022, while payment will commence before April 20, 2022.

Members are allowed to withdraw a maximum amount of RM10,000 and a minimum amount of RM50, and must fully utilise their savings balance in Account 2 first before accessing their Account 1.

Today’s decision came as a surprise since Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz had indicated hesitancy to allow the withdrawal.

Another one-off RM10,000 facility could amount to RM63 billion if all 6.3 million eligible were to make the withdrawals, the minister told the Dewan Rakyat on Monday.

The EPF recently announced a 6.1 per cent dividend for conventional savings for 2021, one of the highest to date, but Zafrul said it could have been as high as 6.7 per cent if previous unprecedented Covid-19-related withdrawals were not allowed.

This would have meant RM5.4 billion in terms of additional dividend could have been distributed among EPF members.

Umno president Datuk Seri Ahmad Zahid Hamidi and his ally, former prime minister, Datuk Seri Najib Razak, have been pushing for the RM10,000 withdrawal, making it a campaigning issue at the recently concluded Johor state election, where the party won with a supermajority.

Ismail Sabri is Umno vice-president.- Malay Mail, 16/3/2022