PUTRAJAYA, Nov 23 — The Employees Provident Fund’s Shariah savings assets will be completely separated from conventional savings assets effective January 1, 2024.

The move is expected to generate a better dividend return under its Shariah contribution scheme or at least equivalent to EPF’s contributions under the conventional scheme, Deputy Finance Minister Datuk Seri Ahmad Maslan said in a press conference after officiating at the Finance Ministry and its Agencies’ Joint Integrity Day 2023 here today.

For example, he said the 2022 dividend under the conventional scheme is 5.35 per cent versus the 4.75 per cent under the Shariah scheme, and this trend has persisted for several years with its dividend rate never surpassing the conventional one.

EPF offers private sector employees the option to contribute savings under its Shariah or conventional schemes.

"The separation (of the two) will give (contributions under) the Shariah scheme the freedom (to invest), so there is a possibility that the (dividend rate) if not exceeding that of the conventional scheme, will at least be equivalent to it,” he said.

EPF chief executive officer Datuk Seri Amir Hamzah Azizan said about 40 per cent of the RM1.1 trillion assets under its management are Shariah assets currently.

"When we do a breakdown of the two schemes, we are able to differentiate the savings and investments made. Therefore, (contributions) under the Shariah scheme are free to choose where they want to put the savings, and where they can get a higher return to reduce the (dividend rate) gap between the conventional and Shariah schemes.

"But the returns depend on the performance of the assets we have (invested in). We put in the effort to separate (the two forms of contributions) first and see how we can reduce the gap,” he said.

Meanwhile, Ahmad Maslan said the Ministry of Finance (MoF) will study every criticism and leakage reported in the Auditor-General’s Report 2022.

"It is closely related to integrity, such as the abuse of power and corruption, and if these can be reduced, then many issues can be resolved. So we hope the Auditor-General’s warning will (help) speed up and streamline financial matters,” he said.

On the criticisms levelled on the weaknesses in the development management of Langkawi Development Authority’s (Lada) two property projects, Ahmad Maslan said the MoF is aware of the issue and hopes the relevant parties would take the appropriate action.

In the 2022 A-G report, Lada had failed to collect land lease revenue from the St Regis Hotel development project totalling RM3.19 million since 2018; and for land leased under the Tok Senik Village project amounting to RM8.30 million since 2003. — Bernama