KUALA LUMPUR: The Employees Provident Fund (EPF)says the 2023 Budget has taken into account the demographic changes resulting in an increasing number of ageing population.
The budget had also considered the significant shift in employment landscape from formal to informal employment, the EPF chief executive officer Datuk Seri Amir Hamzah Azizan said today.
"The changing landscape further reinforces the need and urgency for Malaysia to adapt to current changes in order to safeguard Malaysians' income security during old age.
"We are pleased that some of the concerns raised by the EPF, primarily on the critically low retirement savings and long-term financial wellbeing of Malaysians were addressed in the budget.
"Budget 2023 is an inclusive budget and among others, it seeks to bring improvement to Malaysia's social protection system. The government is taking concrete steps to pave the way for more reforms as well as strengthening the foundation for the development of a strong social wellbeing infrastructure," he added.
The EPF welcomed the government initiative to encourage its members with low savings and are nearing retirement age to continue to save and accelerate the accumulation of their retirement savings.
Prime Minister Datuk Seri Anwar Ibrahim, when tabling the budget today, said the government would allocate about RM1 billion to contribute RM500 on a one-off basis to about two million members aged between 40 and under 55 with EPF savings of RM10,000 and below in their Account 1.
The EPF said it would be taking on this initiative and further announcements regarding its implementation would be made in the near future.
The pension fund also thanked the government for extending the i-Saraan programme for 2023 and increasing the maximum limit of the matching contribution incentive for 2023 from RM250 to RM300 per year.
"This initiative will benefit members under i-Saraan who are outside the formal sector, including housewives, and help accelerate their financial security for retirement," it said.
The EPF lauded the initiative to expand the scope of annual tax relief for life insurance premiums or life takaful contributions to cover voluntary contributions to the EPF of up to RM3,000.
This initiative can be enjoyed by all workers, both in the formal or informal sector, who make voluntary contributions to the EPF.
This means that a member who contributes compulsorily (tax relief up to RM4,000) and increases savings with voluntary contributions will be able to enjoy tax relief of up to RM7,000.
"This effort will encourage more Malaysians to increase their retirement savings for old age," it said.
The EPF said it was enhancing its investment operations to ensure its Simpanan Konvensional and Simpanan Shariah (SS) were invested optimally to provide competitive returns to 15.7 million EPF members.
The enhancement includes the implementation of an earlier effective date to become an SS member compared to the current policy in which the effective date is on an annual basis.
Amir Hamzah said the wellbeing of Malaysians during their golden years remained a key priority.
"The EPF will support the implementation of these initiatives to catalyse the accumulation of retirement savings for EPF members, with a view to helping them achieve a dignified retirement," he added.