Covid-19: MTUC urges govt not to allow EPF withdrawals, provide interest-free loans instead

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KUCHING, March 23: The Malaysian Trades Union Congress (MTUC) urges the Malaysian government to utilise its reserve funds to assist the people instead of allowing Employees’ Provident Fund (EPF) contributors to withdraw RM500 a month from their savings.

MTUC secretary-general J Solomon in a statement asserted that instead of making it easier for the people, the government is resorting to asking the workers to take money out of their own provident funds meant for old age savings and spend it.

“As proposed to the Ministry of Finance (MOF) at a meeting this morning, we urge the government to use its reserve funds to provide interest-free loans of at least RM5,000 each to help these members to sustain themselves and their families during this crisis.

“They should be allowed to start repaying through salary deductions once the situation returns to normal,” he asserted.

Earlier today, Prime Minister Tan Sri Muhyiddin Yassin announced that Malaysians below the age of 55 will be allowed to withdraw RM500 a month from their EPF savings for up to 12 months as an effort to ease their financial burden during the Covid-19 outbreak.

Meanwhile, Solomon also asserted that the government should have the moral courage to dig into its reserves to pump in this money directly onto the pockets of workers without having to compromise their old age savings.

According to Solomon, most members use their EPF Account Two for housing loan repayment to save on interest. Others also depend on this account to fund tertiary education and medical needs.

“Many of them have already opted to reduce their monthly contributions by four per cent, which will have an adverse effect on their savings. But to ask them to take out their own savings at a time like this is adding salt to injury,” he added.

He opined that the government, whether it realises it or not, is actually trying making itself look good by allowing this.

In other words, he added, it is using workers’ savings to pump in RM50 billion for the next nine months.

“This is not a morally right thing to do. It is a case of having to “rob” from one’s own savings, arising from the failure of the government to protect its people.” — DayakDaily