Finance Ministry: T20 group ‘monopolising’ EPF with their savings, went up by 11pc during pandemic

KUALA LUMPUR, Feb 22 — Deputy Finance Minister Datuk Seri Ahmad Maslan today said that the top 20 per cent of income earners (T20) in Malaysia are “monopolising” the Employees' Provident Fund (EPF) with their savings making up the bulk of the total amount.

In contrast with other groups, the T20 also saw the savings in their EPF accounts increase by 11 per cent during the Covid-19 pandemic, he noted during the winding-up speech for the Finance Ministry in the Dewan Rakyat.

“The EPF is monopolised by the T20,” he said.

In April 2020 the total number of funds in the EPF accounts belonging to T20 account holders was RM538 billion, which then increased to RM597 billion by December 2022, he said.

A total of 2.6 million EPF members come from the T20 category, he added.

He said the total of EPF funds from the bottom 40 per cent of income earners (B40) in April 2020 was RM13 billion, which fell by 46 per cent to RM7 billion last December.

There were 5.2 million B40 EPF members, he added.

Ahmad said the total amount of funds from the country’s middle 40 per cent if income earners (M40) similarly fell by 28 per cent from RM191 billion in April 2020 to RM138 billion in December 2022.

M40 EPF members also numbered 5.2 million.

“Those who are qualified do not want to withdraw,” he said in reply to Bera MP and former prime minister Datuk Seri Ismail Sabri Yaakob and Bachok MP Mohd Syahir Che Sulaiman who called for another round of EPF withdrawals.

Ahmad also pointed out that the other countries like Australia, Peru and Chile that had similar schemes to Malaysia’s EPF had stopped allowing withdrawals.

“The structure of wages in Malaysia is very low and that is a structural issue hence we want to ensure that the people will have high wages so that their EPF funds remain high across all races, and this is among the main things we want to do,” he said.

Ahmad gave a breakdown of the median EPF savings in the same time period by race.

He said that for Malays, savings went down from RM16,938 to RM5,529; for non-Malay Bumiputera it was RM10,591 to RM3,302; for ethnic Chinese it was RM45,756 to RM45,162; and for ethnic Indians, RM25,724 to RM14,929.

“This is among the reasons that the government has declined to give permission,” he said.

Between 2020 and 2022, under the leadership of Tan Sri Muhyiddin Yassin and then Ismail Sabri, the government allowed four special EPF withdrawals.

Since then, PN MPs have continued to call for targeted EPF withdrawals to help Malaysians cope with the cost-of-living crisis, but the current unity government has declined to allow it.

Ismail Sabri has also championed the issue, urging Malaysians to make their voices heard if they want EPF withdrawals.