EPF Act may be amended to raise the age for withdrawal

KUALA LUMPUR (July 15, 2012): The government is considering amending the Employees Provident Fund (EPF) Act 1991 to raise the age for partial withdraw by contributors to 55 years and full withdrawal to 60.

Deputy Finance Minister Datuk Donald Lim Siang Chai said the move follows the passing of Minimum Retirement Age Bill 2012 in Parliament on June 27 to extend the minimum retirement age for private sector employees to 60 from 55 at present.

Currently, contributors can make partial EPF withdraw at 50 and full withdrawal on retirement at 55.
Lim in an interview with Nanyang Siang Pau published today said the government will provide a transition period to continue to allow those who have reached aged 55 to make full withdrawal of their saving.

Human Resources Minister Datuk Seri Dr S. Subramaniam had said in Parliament that with the extension of the private sector minimum retirement age to 60, apart from the EPF, the Social Security Organisation (Socso) would also have to amend its regulations.


Some EPF contributors have expressed concern that the minimum retirement age law would prevent them from making full withdrawal at 55 years.

Lim said in tandem with the passing of the Minimum Retirement Age Bill 2012, the amendments to be made to the Employee Provident Fund Act 1991 being considered include the withdrawal procedures and other clauses to ensure they keep abreast of changing times.

He said considerations will be made regarding the flexibility in making withdrawals for specific purposes.

At present, contributors can make partial withdrawal of their savings for house purchase, medical treatment, children’s education and for investment in unit trusts.

Lim said during the transition period, contributors who have reached 55 years old can still make lump-sum or full withdrawal.

Subramaniam had earlier reportedly said for the time being there would not be any change to the policy for full withdrawal by contributors upon reaching 55 years old.

He said the government wanted to amend the Employee Provident Fund Act 1991 to ensure that those who work until 60 can continue to contribute to the fund until retirement.

“The feedback received by Human Resources Ministry showed that the people want the policy for full withdrawal of EPF saving at 55 years old retained,” he said.


Source: http://www.thesundaily.my/news/435161