“We want more people to meet the basic savings targets, The only way to do that is to increase their contribution, which they can do voluntarily.
“Unfortunately, it’s quite difficult to do that statutorily at this point of time,” CEO Ahmad Zulqarnain Onn said, adding that Malaysia is currently an ageing nation and is expected to become aged by 2043.
An aged nation means 14% of the population are over 65.
Zulqarnain said EPF’s strategies have to tackle the problem of saving inadequacy – people not putting enough aside for retirement – and he encouraged Malaysians to meet their basic retirement saving goals.
“Our strategy is to educate the public. From the perspective of behavioural finance, once someone starts the habit of contributing to EPF, they most likely won’t change that habit.
“(We will) find ways to make it easy for people to contribute,” he said during the annual briefing session at the EPF headquarters here today.
He said a worrying condition is that only 17% of members aged 51 to 55 have achieved basic savings.
Zulqarnain said EPF is also seeking ways to enhance retirement security for informal workers as it has become a growing phenomenon in Malaysia.
He said EPF is actively engaging the government to create policies that will cover the statutory contribution of informal or gig workers, such as p-hailing riders.
“There are jurisdictions around the world that actually do cover this sector. Malaysia doesn’t have that but EPF’s job is to advocate for this type of policy changes.
“We research and study the best practices across the world and we have close engagement with the government,” he said.
Earlier, in his presentation, Zulqarnian said EPF faces three challenges in delivering its promise to safeguard the retirement security for Malaysians. They are:
- Inadequate savings that will exacerbate income insecurity at an older age;
- The majority of adults are not covered by retirement schemes; and
- The mismatch between full withdrawal age and actual retirement age as people live longer.