Your MP's Question of the Week #37

The Employees Provident Fund (EPF) is a scheme that ensures “savings for one’s old age” and has, to a great extent, enabled the rakyat to retire from their jobs with some peace of mind when the time comes. It is a highly benevolent scheme where the rakyat and their employers both contibute to its success. The government of the day, as trustee, must ensure its continuity and grow the fund with utter care for the long-term benefit of the rakyat.

Should the administration be irresponsible and short-sighted to treat the EPF as a tool whereby, during economic downturns, it can use to help lighten the financial burden of the rakyat as an excuse by reducing the percentage of their monthly contributions which will also translate to lower dividends?

– Terjemahan oleh Lee Wee Tak – Ucapan ribuan terima kasih dari Wee Choo Keong –

Soalan Mingguan Wakil Rakyat Anda ke-37

Kumpulan Wang Simpanan Pekerja (KWSP) adalah rancangan yang memastikan “simpanan dana untuk usia tua” dan telah membolehkan kebanyakkan orang bersara dengan minda yang tenang apabila waktu itu tiba. Ini adalah suatu rancangan yang baik di mana majikan dan pekerja sama sama menyumbang kepada kejayaannya. Pihak kerajaan, sebagai pemegang amanah, mesti memastikan kemajuan berterusan dana ini demi manfaat jangka panjang pihak rakyat.

Patutkah pihak pentadbiran dengan kurang bertanggungjawab dan berfikiran jangka pendek hingga menggunakan KWSP sebagai alat meringankan beban kewangan rakyat semasa kemelut ekonomi sedunia menerusi pengurangan kadar caruman bulanan yang akan mendatangkan kadar dividen yag rendah di masa hadapan?

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10 thoughts on “Your MP's Question of the Week #37

  1. cronies hater

    The Badawi government should stop raping the EPF for the sake of saving a few of its cronies. With the economic down turn, I am sure that by next year we will see many bailouts of well connected listed companies.

    We must oppose such actions of the government. EPF is meant for the employees and not for the Badawi to abuse it to help cronies.

    I think that the cronies have received enough help already and enough of rakyat monies have been wasted on them. So Badawi please help the nation before you leave by doing something good for the nation that is no bailout and help for BN cronies.

    Reply
  2. Maizatul Ahmad

    YB… could you explain how the government could use the fund from EPF to finance the annual budget or any economic stimulus measures?.

    Can they just transfer the money from EPF coffer to the Treasury? Or was it under some kind of loan scheme? Low interest or soft loan for example.

    Is there any legislation to allow or to prevent such action?

    If there is none, could Pakatan Rakyat (and MDP) introduce such legislation to Parliament.

    As I understand it, in any Commonwealth system of Parliament, any member could introduce a member’s bill.

    I know this sounds like asking too much from you, but it’s from such information that we can properly understand the serious gravity of the matter be galvanized to support your noble cause.

    Thank you, YB.

    Reply
  3. Massale (from Europe)

    Still fighting with the Government like Don Quijote? Here in Europe we have solved this decades ago… Now we listen Keith Jarret piano’s in Koln, Seiji Ozawa’s Four Seasons, Fou TS’ong Nocturnes and Pink Floyd’s Pompei Laser Disk. I wish you where here….

    Reply
  4. Wee Choo Keong

    Cronies Hater

    I am in full agreement with you that there should be no bailout for any company by the government unless it is done with transparency and a proper debate in Parliament. I do not want to see the rakyat monies being abused to help certain company or companies which are connected with the cronies of certain political leader. Rakyat monies should only be used for public purposes like building of schools, roads, hospitals and etc.

    I believe that now that certain company can not be privatised due to world financial crisis is eminent to be bailout because its existent depends on political patronage and help.

    Maizatul Ahmad

    For a start, EPF should not be touched by the Government as it is the people/workers retiring fund. EPF should not be treated by the Government as its financial ambulance to help cronies. The recent RM5 billion that was “borrowed” from EPF to help out Valuecap in the stock market is a good example. Quite frankly, I do not know what is this new entity called Valuecap. May be Tan Sri Nor Yacob can help us with this new term. The other example is the Makuasa Scandal in the late 1980 where EPF was used by the government.

    Every year the government presented its Yearly Budget for approval in Parliament and I believe that it must have taken into account the state of our economy for now and future. Therefore, if it was a well thought out Budget where all interested parties, including the opposition parties, are properly consulted then there is no need for the government to dip its hand into EPF.

    Yes, every MP has the right table a Private Member’s Bill in Parliament for consideration but it will not get discussed as the Government business take priority. Therefore, Private Member’s Bill will never see light of the day unless the Government of the day wants it to be discussed for their political gains.

    As far as I know, in Malaysian Parliament no Private Member’s Bill has been discussed. If I am not mistaken in UK, there were only a few occasions that Private member’s Bill were discussed. One of which is the Peerage Bill which concerned Anthony Wedgwood Benn. However, I stand to be corrected on this because it has been a long time ago and I am writing based on my memory.

    If I got my reply/facts wrong in any way, please pardon me sdr because I am no economist. I hope that other friends, who are experts in these subjects can share with us their valuable views.

    Thank you all so much for your comments. May wish our Muslim brothers and sisters a Selamat Hari Raya Haji and for the non-Muslim borthers and sisters have a pleasant holidays and if you all have to drive please drive safely.

    P/s
    I am sorry to learn about the landslide tragedies in Bukit Bukti Antarabangsa where we have 4 Malaysians and injured many others according to Malaysiakini. My condolences to the families of the unfortunate Malaysians. The Ampang Council must take full responsibilities for these tragedies because there was another tragic example of Highland Tower several years ago where many lives have been lost all due to the negligence/corruption of the council officers.

    May the souls of the four Malaysians rest in peace and God bless them too.

    Reply
  5. Wee Choo Keong

    masalse (from Europe)

    Yoiu are right in Europe or nay developed country no government dare to even dream of touching EPF because they knew that the population will strongly object to it and they will be thrown in General Elections.

    I wish I could also listen to Keith Jarret (playing the white piano) concert in Koln, Ozawa Seiji’s Four Season and Beethoven Symphony No: 9 and climax with Pink Floyd Concert in Pompei, Animals, Wish you were here, Echoes and The Walls. I just love Pink Floyd. It sadden me to know that Pink Floyd is without Roger Waters. I have seen Pink Floyd live twice: Wish you were here and Animals albums in Wembly Empire Pool and The Wall in Earls Court. Pink Floyd is just classic! Pink Floyd sounds fantastic in a Naim system!

    Well, it is great to learn that we love the same type of music. Do keep in touch.

    Thank you so much for engaging with us from Europe. I look forward to hear from you soon.

    wee choo keong

    Reply
  6. lee wee tak

    a few points,

    1) EPF is never enough. People who retires now have been contributing at their salary levels decades ago. What’s 12% + 11% of RM1,000? RM230 means you can spend less than RM10 a day in a month of 30 days. Retirees should be looked after via discounted utilities bills, different rate for public transport (which is the case in Hong kong) and more dedicated public hospitals.

    2) the BN administration has been too used to using EPF for bailouts. That itself is an disincentive for the BN administration to think of new ways to generate income for the nation whether in the areas of economic re-structuring, opening up capital and bureaucratic restrictions, development of human capital and infrastructure etc

    3) EPF accounts should be made public. Why the secrecy? The reluctance to disclose despite assuming the position of trustee is most baffling

    4) even greater secrecy presides over our SOCSO. People who earned above a certain amount cannot claim from SOCSO yet deductions are made from their salary. If I am required to help to pay for injuries to my fellow Malaysians who earn less than me I am fine with it but we have no way absolutely to know how our contribution has been applied. Again, why the secrecy? We Malaysians know more about our military than the state of affairs of our SOCSO and EPF!

    Reply
  7. lee wee tak

    YB, Maizatul Ahmad,

    we should amend the EPF act to make disclosure to public in an adequate manner. buy any unit trust and you can see what counters our fund managers purchase, good or bad is all apparent.

    why the administration of today so scared? is it the “face” factor? I can speculate that in addition to investments in shares, there could be loans with varying degree of interest rate, whether there are any pledged assets as security, tenure and purpose of loans etc.

    Reply
  8. Maizatul Ahmad

    YB and Mr Lee

    I agree the EPF act could be amended in the aspect of the Act to be more transparent in its investment and usage. Maybe that is what is needed. I don’ have the chance to study the legislation, maybe it is already there but lacking in supervision and monitoring in implementation.

    I feel that we should not be hasty in limiting the role of EPF as a lender of last resort to rescue the national economy. It has been used before as YB had mentioned. As it has been cited again and again, it must have saved the national economy when it was used. Which ever government that is in power in future should have the option to prudently make use of EPF fund as a last resort to counter an economic downturn that affect national survivality. It could be regarded as irresponsible if we let our current problem to fester while we have the mechanism to address it. True the fund is for the future, but if current situation is not corrected, then our future and that of our children are affected all the same.

    Alas, its usage must be closely scritunised to ensure that the benefits are for the majority of the population and not for the sake of the priviliged few. The unfolding situation in the US could be our guide at the moment.

    Thank you.

    Reply
  9. lee wee tak

    “…EPF as a lender of last resort to rescue the national economy…”

    – I rather think Bank Negara should assume this role as other countries’ central banks are doing that

    – if also depends who are the recipients. if let’s say MAS purchased those expensive art work as revealed by MG Pillai (may he rest in peace and smile upon his vindication now) and got into financial difficulties, I rather not have EPF being used. If there is a good business suffering from cycle influence but can recover in good time and prudent in its fund management, then I would concur.

    if you talk about EPF buying up good companies’ shares now so that in long term, capital gains can be made for contributors, I would say smart tactical move

    however, throwing money into Value Cap with no indication of security & return of the fund, and chances are foreign fund managers already got paid by some of it…now that’s make me spill my coffee

    Reply
  10. ahoo

    YB, we can concur with you that EPF monies cannot be touched, period ! Once, they have a free hand into that coffer, all subsequent losses will be a cover up. As it is, even as the financial crisis just hit us now, the board of EPF’s had already
    announced that in view of low earnings, this year pay-out will be low than previous years.

    Who is in control of such a massive fund like EPF ? Who are authorised to conduct those transactions ? Just too many questions and likely no answers as the regime that be are in full control of the fund and will at their whim & fancy, move those fund to wherever they deem fit.

    So, where are our rights as contributors ? Where can we take our grievances to ? I have a feeling that the day will come where the fund concern will be return via small monthly portion rather than a large portion when reaching 50. This financial turmoil is going to hit us so hard as never before as our leaders are still in denial mode. Many are still predicting of growth for next year, whereas many MNCs are already into the plan of retrenching workers here in Malaysia. Just talk to the many MNCs out there and you will get immediate input of their plans for the coming years.

    Reply

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