Statistics released by the Employees’ Provident Fund (EPF) yesterday have revealed some shocking figures that should be a real worry for future governments of Malaysia.
These figures were revealed before the announcement of dividends and show that the total current savings of the B40 group is a mere 0.7% of the total, or RM7.7 billion, in the fund.
This group, which is among the most vulnerable Malaysians, number around 6.29 million. They now only have an average of RM1,225 in their retirement fund.
In contrast, the T20 category, who also make up 3.14 million (20% of the total number of members), owns 83% or RM818 billion of the savings in EPF, totalling RM984 billion. On average, they have RM260,205 each.
As for the M40 group, which makes up 40% of the total number of contributors or 6.29 million, they only have 16% or RM159 billion of the total savings in the fund. On average, each of them only has RM25,268.
These numbers reveal how most Malaysians are going to struggle in their old age. All those championing special withdrawals, who happen to be mostly from the T20 category, cannot ignore the danger that lies ahead.
The racial profile of the EPF members also has some worrying indicators.
Malays/Bumiputeras, who make up 9.52 million members, have an average savings of RM35,000. But, as announced before, about 70% of them have savings of below RM10,000. Only the cream from this group has higher savings.
The total held by this group is RM333 billion, or 33% of the total.
The Chinese, on the other hand, make up 4.29 million members, with an average savings of RM129,888 each. Their total is RM557 billion, or 66% of RM984 billion.
As for Indians, there are 1.3 million members, with an average savings of RM62,769, with a total of RM81 billion.
It appears that the low savings figures for the Bumiputeras have been brought upon by themselves and not by any unfair policy or manipulation.
It saw a steep drop for Bumiputeras from a pre-Covid figure of RM15,500 to RM4,900, or 69%. This follows the four special withdrawals that were allowed by the previous governments, which were strenuously opposed by EPF.
It has been said before that a struggling Bumiputera community can destabilise the political landscape.
As for the Chinese, there was hardly any drop, with the members having a median savings of RM45,800 before Covid-19. It came down to RM45,200 — a drop of just 2%.
Among the Indians, the median savings before the pandemic was RM25,700 but dropped by 53% to RM14,900.
By all accounts, the survival of the millions of private sector employees, who are in the lower-income category and mainly dependent on EPF, has come under scrutiny.
As usual, the rich in EPF become richer annually, but it is not by design or any form of engineering.
It’s basically the attitude of Malaysians towards savings and working to be independent after they retire.
Their urge to withdraw their EPF savings even if they don’t have to has now apparently created a huge burden for the government.
Source : FMT