Budget 2023: govt to top up RM500 to EPF accounts with low savings

KUALA LUMPUR – Employees Provident Fund (EPF) members with savings of below RM10,000 in their Account 1 will be given a one-off RM500 injection by the government, the Dewan Rakyat was told today.

This is, however, limited to those who are currently aged between 40 and 54.

Prime Minister Datuk Seri Anwar Ibrahim, in tabling the Budget 2023 today, said the programme will benefit close to two million EPF contributors and will cost the government up to RM1 billion.

Anwar, who is also finance minister, said the government is committed to helping the rakyat rebuild their retirement savings to ensure they have enough funds once they leave the workforce.

He took pity on those who were forced to make emergency EPF withdrawals as a means to survive, after the Covid-19 pandemic affected their income.

Anwar said despite many of these individuals slowly recovering and rebuilding their lives today, they are still forced to spend almost all of their current income to sustain a living, while their retirement savings continue to remain low. 

Meanwhile, he expressed hope that EPF members who have sufficient retirement savings in their accounts will continue to contribute to ensure that all members can benefit.

“We can withdraw under desperate circumstances. But if the government gives RM500 to the poor and the richer members are allowed to withdraw their savings, then the dividends for the lower income group will also be affected.

“We have to make a choice. If we make populist announcements without (focusing on) the details, there will be problems.

“The rich withdrawing EPF funds (indirectly) means the dividends for the poor will decrease.”

In Budget 2023, Anwar also announced raising of the limit on self-contributions to EPF from RM60,000 to RM100,000 a year.

The government will also raise the matching EPF contributions from RM250 previously to RM300 for the self-employed who save with the fund. This increase will involve RM30 million and benefit some 100,000 self-employed contributors.

The tax relief for voluntary EPF contributions will also be increased to RM3,000. – The Vibes, February 24, 2023