'Proposed monthly EPF payouts won't affect existing contributors'

Summary

• Deputy Finance Minister Lim Hui Ying clarifies that the proposed monthly withdrawal mechanism for EPF retirees will not affect existing members unless they opt in.

• The proposal, still under review, aims to provide long-term retirement security by splitting future contributions into flexible and income savings.

Deputy Finance Minister Lim Hui Ying has assured that the proposed mechanism for retired Employees Provident Fund (EPF) members to make monthly withdrawals will not affect the existing members.

In a statement today, she said the new mechanism will only apply to new EPF members who register after the policy is implemented.

Existing members may also voluntarily opt into the new structure if they wish.

Lim further explained that future EPF savings would be divided into two parts:

• Flexible Savings – accessible at any time;

• Income Savings – to be disbursed regularly until the retirement funds are exhausted.

She said the new account structure proposed by the EPF is intended to strengthen financial security for Malaysians after retirement and to ensure a more stable and long-term cash flow for members in their retirement years.

“This announcement is only an initial proposal. The Madani government is committed to continuing to listen to the people and conduct extensive engagement before making any decisions.

“The goal is clear – to ensure the rakyat can manage their retirement funds in a more orderly, fair, and sustainable way,” she said.

Under the 13th Malaysia Plan, the government said it is exploring a new mechanism to ensure a continuous post-retirement income though a monthly pension payout, in contrast to the current lump sum payment upon retirement.

“This mechanism would allow EPF contributions to be split into two components – retirement savings and retirement pension.

“Through this effort, workers can withdraw a portion of their savings while receiving a monthly pension payout after their retirement,” said the document.

Following public concerns, the EPF clarified that the proposal is still under in-depth study, and a decision will only be made after seeking comprehensive feedback.

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