Anwar reiterates govt has no plans to introduce further targeted EPF withdrawals

KUALA LUMPUR, March 4 — Prime Minister Datuk Seri Anwar Ibrahim reiterated today that the federal government has no intention of introducing further targeted withdrawals for Employees’ Provident Fund (EPF) contributors.

Speaking in the Dewan Rakyat today, Anwar said the core principles of EPF hinges on retirement savings and the introduction of additional withdrawals will pose problems for these contributors several years down the road.

“By giving such a wide leeway, this will inevitably punish them when they retire or age.

“So the government has had to strike a balance between solving the urgent problem they faced and punishing them when they retire in the future with no means of self-contribution,” he said.

Anwar said this in response to Padang Terap MP Nurul Amin Hamid who had asked whether the government would consider introducing targeted withdrawals for contributors that are currently facing unemployment, debt and rising cost of living.

He said the latest data provided by EPF showed that ethnic Bumiputera contributors have one of the lowest retirement saving levels — with a median EPF savings of just RM8,920 as of December last year.

“I understand the concerns raised by YB and that is why there are also special exemptions provided,” he said.

However, Anwar also pointed out that any appeals made by contributors will be given due consideration by EPF, subjected to their respective circumstances necessitating an urgent withdrawal.

Anwar also said the government has no intention of imposing mandatory Shariah savings contributions for Muslims following a dividend rate of 6.30 per cent for both conventional and Shariah savings — the first since 2017.

“This [dividend] record is important because this will further encourage Muslims to contribute.

“With further encouragement and explanation, it is hopeful the number of contributors will increase,” he said in response to a supplementary question by Datuk Mohd Isam Mohd Isa.

Anwar also said the proposed two per cent mandatory EPF contribution for foreign workers will not divert the EPF’s attention from its specific focus on citizens’ retirement savings.

He said it has always been the government’s strategy to safeguard the interest of local workers.

The mandatory EPF contribution for foreign workers was announced by the prime minister during the tabling of the 2025 Budget last October.

Anwar reportedly said that the move is in line with the government’s commitment to providing fair treatment to all workers regardless of their nationality as per international standards.

Finance Minister II Datuk Seri Amir Hamzah Azizan had also reportedly said that the policy was aimed at improving wage equity and ensuring the local workers are not disadvantaged as the government aimed to close the wage gap between local and foreign workers.