PETALING JAYA: Increasing the retirement age of workers in the private sector from 55 to 60 is ideal, the Malaysian Employers’ Federation (MEF) said.
Its executive director Shamsuddin Bardan said it was high time the retirement age was reviewed in tandem with the rest of the world.
“In the past, many people did not even live past their retirement age but now, people live longer – some by up to 20 years after retirement. That is a long time without a job,” said Shamsuddin, adding that many people had inadequate Employees’ Provident Fund (EPF) savings.
According to last year’s EPF report, active members at the age of 54 had an average of about RM146,000 in savings.
A 2003 survey commissioned by the EPF found that 70% of retirees used up all their EPF money within 10 years after they stopped working.
“If they can work up to 60, they can probably boost their savings by RM15,000 to 20,000. It’s not much, but it helps,” he said, adding that about 100,000 people retired from the private sector every year.
He said Malaysia was the only country in South-East Asia to have a retirement age of below 60.
The retirement age for workers in Indonesia and Thailand is 60, while in Singapore it is 62.
EPF chief executive officer Tan Sri Azlan Zainol said the fund’s wish for Budget 2012 was for the retirement age to be raised to 60 because a long retirement period was one of the factors that contributed to inadequate retirement savings.
Senior Consumers Association of Kuala Lumpur president Captain (P.A) Francis Kerk said many retirees could still contribute to the economy, adding that the retirement age could be gradually increased to 65.
Federation of Malaysian Manufacturers (FMM) president Tan Sri Mustafa Mansur said the body strongly objected to the proposal.
“Extending the retirement age should only be considered when the present rigid and inequitable laws on hiring and firing have been amended,” he said.
Employers should decide on a retirement age that was most appropriate to their organisation, he said, adding that its survey of 260 members showed that 87.5% did not agree with the proposed mandatory retirement age.
FMM northern branch chairman Datuk O.K. Lee said the manufacturing industry in Penang did not welcome the proposal to raise the retirement age in the private sector beyond 55.
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