Merge EPF, Socso for a better future

I REFER to the debate on the Employees Provident Fund’s (EPF) decision to extend the withdrawal age bar from 55 years to 60. I am compelled to prod the minds and hearts of EPF, the Social Security Organisation (Socso), probably the Ministry of Women, Family and Community Development and Malaysians as to whether we are enjoying a peaceful retirement or a scary one.

EPF and Socso are contributory funds that claim to be social security funds in the Malaysian context. But is this true and how effective is it?

Is EPF able to support someone who is retired, or the family of a deceased retiree? It is nearly impossible as 68 per cent of EPF contributors aged 54 or lower have less than RM 50,000 in savings.

The average working Malaysian is not saving enough to cope later in life. The United Nations projected that Malaysia will become an aged nation by the year 2030.

Can the current social cultural system support the ageing population, whereby the extended family is becoming extinct?

The elderly are left to fend for themselves as children migrate to explore career, education, and business opportunities. Have EPF and Socso studied this trend? It is impossible that they are oblivious to such issues, unless they have chosen to feign ignorance.

Food, clothing, shelter, healthcare, justice and security are basic and legitimate needs that must be maintained after retirement.

People, especially in the private sector, cannot retire peacefully. EPF is allowing usage of the funds for healthcare, education and even buying a house, thus reducing the financial quantum at retirement.

It is vital to have a pension fund that reflects on, and liaises, with the cost of living. This can only be done if EPF and Socso join hands and take care of Malaysians. EPF dividends, especially for 70 per cent of its poor members will only drain national resources, especially in healthcare.

Schedule 9 Item 14 of the Federal Constitution states that the government is to provide healthcare. EPF should not be used for health or medical purposes. EPF and Socso must be merged so that a healthcare, pension and workman compensation fund can be created. Better still, a social security fund/ organisation offering all the elements of social security.

Every child born has a birth certificate. Likewise, every child must have a pension fund opened the day he is born. It should be a service-based fund which must be reviewed from time to time. The fund is generated through employers, employees and the government.

The taxes from the Goods and Services Tax and income tax must also contribute to this fund.

Socso must join hands with EPF to provide a state-sponsored, supervised and managed pension, healthcare till death of members and immediate family members.

The nation needs a greater social security net to sustain their future. Developed countries have a wonderful system in place to meet the needs of the ageing population. They have a pension fund, healthcare and workman compensation.

We don’t need revisions to the withdrawal age, but this significant merger and overhauling of schemes are of paramount importance to the wellbeing of every Malaysian.

It is time to think through social security. It’s pointless to point out that we are not saving enough. There must be an affirmative plan drafted to mitigate this problem of our nation’s pride, that is our people.

Ravindran Raman Kutty, Kuala Lumpur

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