PKR vice president Rafizi Ramli today proposed a compromise solution to allow Employees Provident Fund (EPF) contributors to withdraw their money in stages beginning at age 55.

This comes after contributors being up in arms over EPF's announced plan to raise the withdrawal age from 55 to 60 in line with the new retirement age.

Rafizi ( left ) said he acknowledges EPF's explanation that contributors may have insufficient amount of contribution if they were to withdraw it at age 55 and that it will deplete in a matter of a few years after withdrawal.

"Taking the above considerations, I propose that EPF contributors be allowed to make withdrawals in stage beginning at age 55 until 60.

"For example, contributors can choose to withdraw 60 percent of funds at age 55 and the remaining 40 percent at age 60," Rafizi said in a statement.

Alternatively, he said it can be withdrawn at a ratio of 50:50 or 40:60 which can be left to contributors to choose.

Don't punish contributors

Rafizi added that while he concurred that the contributions from private sector workers may not be sufficient to sustain their retirement, they do not deserve to be "punished" by being unable to withdraw their EPF fund until age 60.

"The low contribution and hardship due to high cost of living should not be blamed on contributors as it is the federal government's failure," he said.

He pointed out that Putrajaya's recent moves to introduce the Goods and Service Tax (GST), abolish subsidies has led to rising cost of living.

Furthermore, he said the government has promoted a policy of pro-employers and low wages on the grounds of promoting investment since the era of former prime minister Mahathir Mohamad.

Rafizi added that the government's policy of allowing foreign labour to flood the local market has also kept wages low.

"The pro-employer policies have encouraged low wages and this causes the private sector worker's EPF contributions to remain low until retirement," he said.

Rafizi urged EPF to intensify courses and briefing on investments to help contributors to wisely use their contributions after withdrawal.