The Malaysian Trades Union Congress (MTUC) has urged the government to replace the Employees Provident Fund (EPF) i-Lestari Account 2 withdrawal scheme with RM500 monthly cash aid for B40 workers with immediate effect.
This call comes after EPF’s recent announcement that the majority of the 4.1 million applicants for the i-Lestari scheme are from the B40 income group. According to its CEO Tunku Alizakri Alias, some EPF members have already exhausted their Account 2 funds after two months of withdrawing RM500 per month.
MTUC secretary-general J Solomon shares EPF’s concerns that the B40 group, which needs the retirement savings the most, will be “victims” of the scheme.
“MTUC had warned the government time and again that this move was highly dangerous because of this very reason,” he said.
“The fact is most of these workers need the RM500 per month subsidy badly to survive with many having lost their jobs or taken huge pay cuts. In view of this, MTUC is calling for the government to convert this scheme to a RM500 a month cash aid for the B40 workers with immediate effect.”
Solomon said the government can source the funds for the monthly cash stimulus from its reserves, as well as cut operational costs and overheads in government-linked companies and government departments.
He pointed to the Singapore government, which had provided wage subsidies for its low-income workers for nine months, as an example for the Malaysian government to emulate.
Solomon also brought up some concerns over the finance minister’s failure to consult EPF’s CEO on the financial situations of the fund’s members before implementing the scheme.
“We hope the government’s financial and economic advisors will see this obvious adverse effect and understand the need for this category of workers (B40) to be given this RM500 a month aid at least until December,” he said.
The i-Lestari scheme allows EPF members aged 55 and below to withdraw between RM50 and RM500 a month for 12 months from March 31, 2020 to March 31, 2021, subject to available funds in the members’ EPF Account 2. As of June 5, 2020, a total of RM1.94 bil had been withdrawn. – June 19, 2020
