I REFER to the comments by Second Finance Minister Tan Sri Nor Mohamed Yakcop on the government’s insistence that Employees Provident Fund members who do not want the three per cent reduction in their monthly deductions to inform the fund (”More money will be pumped in if need be” — NST, Nov 10).

I believe the EPF charter is to safeguard the “enforced savings” of its members for retirement, and I further believe that its board of trustees is to ensure these savings are maximised through prudent investments.

Just last month, it was reported that the EPF would invest RM5 billion in ValueCap.

I found this news to be very disturbing because I have little faith in ValueCap’s investment expertise to need such a massive injection of capital. I came to the unavoidable conclusion, with which I’m sure many others would also agree, that my EPF contributions are being used again to bail out a troubled government-linked company.

When our deputy prime minister announced the RM7 billion capital injection plan two weeks ago and I read that RM4.8 billion of this amount (about 70 per cent) would be coming from the proposed three per cent reduction in employee’s contributions to the EPF for the next two years, I was sceptical of the brilliance of this plan.

When I read that this “voluntary” reduction would be “automatically” done unless the member fills in a form to maintain his/her deduction at the current 11 per cent, I was flabbergasted. The way it is being done seems to be more of a compulsory reduction in EPF contribution to eight per cent. Is our local economy so bad that we, the EPF members, have to bail it out as well?

The second finance minister also said that this system had been implemented effectively in the past. To that, I can only say that the past is the past. Malaysians do grow up, you know.

I do think that there are EPF members who could use the extra tens of ringgit (what they won’t have to contribute to the EPF) each month to make ends meet.

I also believe that the majority are making do with what they have right now, and that this plan merely undermines their future retirement fund. I am not alone in this way of thinking.

In the company that I work for, almost everybody is in agreement that we want to maintain our contribution at 11 per cent. Everybody else that I have spoken to wants to maintain their contribution at 11 per cent, but some balk at the idea of having to go to the EPF office to keep it that way. It makes you wonder sometimes who is in the majority here.

ANDREW MA, Petaling Jaya

Source: NST – November 11, 2008