EPF Account 3 introduction is tell-tale sign Malaysian economy, the B40 group are in dire straits

WHILE the Kuala Kubu Baharu (KKB) by-election was going on last May 11, another more significant event went in the country almost unnoticed.

This event was introduction of Account 3 by the Employees Provident Fund (EPF) which allows contributors to allocate 10% of their EPF contribution to a newly created third account called the Akaun Fleksibel which they can withdraw from at any time – just as they would withdraw money from a bank account.

Now, you might ask, what is the purpose of introducing Account 3?

Of course, if you listen to the government and the powers-that-be, they will probably say that they introduced the Account 3 scheme solely for the convenience and benefit of the grassroots and the working class.

Regardless of what narrative the powers-that-be are spinning, I personally reckon that the government most likely introduced the Account 3 scheme because the economy and the B40 are in such dire straits that the government thought allowing the B40 to dip into their savings would enable them to save themselves without needing a cent to be spent on them.


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But is it true that the situation of the B40 group has become dire? Well, let me put it to you this way.

Once you sign up for Account 3, if you have a base salary of RM2,000 – and you and your employer contribute a total of 24% of your base salary to your EPF every month – your contributions to EPF will amount to RM480/month. Of that, 10% which is RM48 is what you can withdraw from your EPF Account 3.

If you wonder what a mere extra RM48 a month can do for a person, you should check out the extraordinarily long queue at the EPF offices across the country as soon as registration for Account 3 opened.

Need to identify root cause

From the size of the queue, you can clearly see that many people in the country might not be able to make it through the month without that RM48 which we round up to RM50.

If so many people are queuing up just to get access to an extra RM50/month, then surely there must be many people in such a dire situation in the country that if they fall sick or need sudden cash to fix their bike, phone or car, they have no better place to go to than to dip into their EPF Account 3.

Now you might say that such strong speculation and conjecture cannot be made baselessly and that studies need to be conducted by legitimate authorities before deciding whether the economy and the B40 are indeed in such dire straits.

But I put it to you that we will never have such a study conducted, hence that is why we have to resort to conjectures and speculations.

This being Malaysia, uncomfortable truths that embarrass or inconvenience the powers-that-be will never see the light.

Even if the economy and the B40 is in a dire condition, our media, intellectuals, government agencies or institutions are most likely going to keep quiet about it rather than look for the truth and get themselves in trouble with the powers-that-be.

I seriously doubt whether they will ever conduct any serious study to ask whether the EPF Account 3 was introduced for the benefit of the people or for the benefit of the powers-that-be who might just require the Account 3 to be introduced to pump into the economy a couple of billions of the working class’s savings so as to keep their pockets filled.

To find out the truth – as usual – we will just have to wait and see. – May 15, 2024


Nehru Sathiamoorthy is a roving tutor who loves politics, philosophy and psychology.

The views expressed are solely of the author and do not necessarily reflect those of Focus Malaysia.

Main image credit: Kosmo!

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