Full withdrawal age stays at 55

PETALING JAYA: Employees Provi­dent Fund (EPF) members will retain their right to make full withdrawals at 55, but all contributions after that will be locked in until they turn 60.

EPF members have overwhelmingly opted for this option in the ongoing online consultation process initiated by the fund.

Prime Minister Datuk Seri Najib Tun Razak said while delivering the keynote address at Invest Malaysia 2015 yesterday that EPF contributors would keep their right to withdraw their savings at the age of 55.

Stressing that he was aware of public concerns about any future changes to the EPF, he said: “In just two days of the consultation process, more than 50,000 Malaysians have taken part and given their views. It is already the largest ever public consultation carried out.”

Najib said the Government always listened to the views of the people.

“It’s clear the vast majority of EPF members, while understanding the important of retirement savings at the age of 60, want the right to use their retirement fund at the age of 55.

“I want to assure the public that EPF members will retain their right to withdraw at the age of 55.”

Najib said if members decided to work beyond the age of 55, EPF would ensure that any new enhancements would only apply to new contributors.

“This strikes a fair balance between the rakyat’s expectation to their hard-earned money at the age of 55 while protecting them if they retire at the age of 60,” he added.

Najib also announced that EPF had embarked on an initiative to offer syariah-compliant investment options for members from 2017.

“This will create the largest syariah fund of its kind in the world and will further strengthen Malaysia’s position as a leading Islamic financial centre,” he added.

EPF deputy chief executive officer (strategy division) Tunku Alizakri Raja Muhammad Alias said all remaining withdrawal schemes, including one-third withdrawals at 50 and for housing, would not be changed.

“Under the proposals, EPF had only sought members’ input for changes to the age of full withdrawals. It is status quo for all other existing withdrawal schemes,” he said.

He said members could continue to make full, partial or flexi withdrawals at 55 and the changes were essentially on their new contributions from age 55+1 until 60.

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Previously, EPF members above the age of 55 who are still employed could make withdrawals every month, but this would no longer be allowed.

Tunku Alizakri, however, said it would take some time before the changes kicked in.

On EPF’s consultation exercise, he said it would continue until May 5.

“The findings need to be presented to the board before the process to make the changes, as announced by the Prime Minister, can start,” he said.

A survey conducted by The Star on Tuesday also found almost 90% of those who responded wanted the status quo to remain.

EPF chief executive officer Datuk Shahril Ridza also welcomed Najib’s strong support for the consultation exercise, which started on April 21.

He also acknowledged EPF members’ preference for the option that preserved flexibility and protected the contributions of members.

“This is definitely in line with our preliminary findings of the members’ consultation survey which overwhelmingly indicated the support for option two under our proposal.

“The option offers retaining the full withdrawal age of 55 years and to lock in new contributions until the age of 60,” he said.

Shahril urged EPF members to continue with their response to the survey, which includes proposals for other initiatives.

“We want to make sure our members’ voices are heard on matters that have direct bearing on their retirement savings,” he said.