Changes in EPF, Socso schemes on the way to boost financial security

PETALING JAYA: The government’s retirement savings fund EPF and work insurance scheme Socso have been tasked with preparing a blueprint to improve social protection in the country.

Balqais Yusoff, head of the strategy management department at the Employees Provident Fund, told FMT that various agencies and ministries would also be part of a committee to give input on policies.

“I can’t say who is on the committee at this juncture as it has yet to be formalised,” she added.

“There will be some changes in how we look at the EPF scheme and others as well.”

She said the recommendations would be presented to Deputy Prime Minister Dr Wan Azizah Wan Ismail to be taken to the Cabinet by the end of this year.

She added that the committee was looking at areas such as shelter, health, nutrition, education and mobility, as part of a wider solution to problems on income security.

Balqais Yusoff.

“Our main focus will be income security, because that’s where we play our role as an agency that provides replacement income.

“Whatever we do, we need to make the system sustainable, but it also needs to be sustainable for the individuals. Otherwise, there’s no point.”

There have been concerns that EPF savings, meant to help Malaysians in their old age, may not be enough.

Balqais told a recent forum that EPF statistics showed many Malaysians do not save enough and end up using up their savings in less than five years.

In 2016, Balqais revealed that only 22% of 6.7 million active contributors aged 54 years had RM196,800 or more in their savings, which comes up to just RM820 a month.

Norma Mansor, director of the Social Wellbeing Research Centre at Universiti Malaya, agreed.

She said retirees would not be able to survive on EPF savings alone.

“Even though our formal life expectancy at birth is 75, as we see around us, people are living beyond 80. There’s a good 20 years left to live for those who retire at 60.

“The reality is that they will not be able to stretch their savings for that duration,” Norma, who is also part of the blueprint committee with EPF and Socso, told FMT.