GEORGE TOWN: Human Resources Minister M Kulasegaran today said PTPTN, the National Higher Education Fund Corporation, can deduct salaries of its borrowers, as they are empowered by federal law to do so.
He said while he agreed with a unionist that employers on their own cannot deduct salaries without permission from workers, PTPTN can order them to do so.
Kulasegaran told FMT this was because the country’s employment laws allowed PTPTN to make deductions from salaries.
He said under Section 24(d) of the Employment Act 1955, employers may make deductions authorised by any other written law.
He said under Section 29(1) of the PTPTN Act 1997, employers are obliged to deduct the borrower’s salaries when notified by PTPTN or the Inland Revenue Board (IRB).
Under this section, employers who fail to do so are liable to a maximum RM20,000 fine or one year’s jail.
“What I want to stress here is that employers, on their own, cannot deduct the worker’s salaries, unless instructed by a lawful body, such as the IRB. Or in this case, the PTPTN,” he said.
Kulasegaran was responding to remarks by Malaysian Trades Union Congress president Abdul Halim Mansor, who said employers cannot make any deduction from salaries of PTPTN borrowers.
Kulasegaran also said the move by PTPTN to recover its debts was due to the country’s finances, with ministers themselves taking a 10% pay cut across the board since taking office in May this year.
“If we are doing very well, then there is no need for pay cuts. This is part of our sacrifices. Everybody must play their part.”
Yesterday, PTPTN chairman Wan Saiful Wan Jan said borrowers earning RM2,000 and above will have 2-15% of their salaries deducted to repay their student loans.
While the repayment amount for those earning RM2,000 is only RM40 a month, the figure spikes for those earning RM8,000 and above as they will have to fork out 15%, or RM1,200 each month.