LETTER | Many aspects of the stimulus package are good to boost the weakening economy. The various incentives given to the tourism and SME sectors are necessary to ensure their revival and survival.

The Covid-19 epidemic is going to affect the world in a very serious way and Malaysia as a major trading nation will be very badly hit if there are no protective efforts by the government.

One major aspect is the government's intention to boost consumption to aid the domestic economy. The reduction in EPF contributions will mean about RM10 billion in the hands of consumers and together with the increased BSH (Bantuan Sara Hidup welfare scheme) payments, it could impact much. It will also mean RM10 billion less to the EPF’s coffers. The petrol subsidy should be included in the BSH to make it easier.

The EPF is already finding it difficult to invest its huge funds and get a reasonable dividend for its members. The 18 percent reduction in the PLUS highways will also mean reduced revenue and profit for EPF as it a major shareholder in the Highway concessionaire. This could mean lower dividends next year. 

The EPF also has to be careful about its overseas investments as its foreign forays had been criticised before. Many foreign investments could look attractive but may be fraught with risks, and EPF will have to answer to its critics. It cannot expect the same investment environment prevailing here as in Malaysia because the EPF is shielded by the government due to its national importance.

The government which draws tens of billions of ringgit from the EPF for it socio-economic programmes needs to pay a higher rate of interest to the EPF for using its funds, very much like the interest rate it would pay to private banks and funds local or foreign. Since it is an open secret that the government regularly tops up the dividends of various bumiputera funds, I don’t see why it should not do the same to the EPF as it will satisfy the millions of members who are usually up in arms when dividends fall below a reasonable percentage.

To show its appreciation to the EPF for allowing to use its funds, the government can also give lucrative projects to the EPF as whatever profit the EPF makes goes back to the people. 

There is also a need for the EPF to downsize its staff and number of offices nationwide. With computerisation and digitalisation having reduced the workload, there is no need for a large number of staff as it is a financial burden. The number of offices can be reduced for the same reasons. Buying properties is alright as it enhances the fund.

There is a bright future for the EPF. The RRI estate comprising more than 2000 acres is a gold mine for the EPF. It was purchased from the federal government more than 12 years ago. Disappointingly, there is hardly any progress in infrastructure and development efforts apart from the new EPF headquarters that is being built opposite Kota Damansara. 

Previously, it was thought that development efforts were hampered by the state government being controlled by Pakatan Harapan and BN controlling the federal government. The EPF is regarded as a federal government entity and therefore political differences were the cause for the delay as land, development and planning are state matters and the Selangor government as well as city councils MBSA and MBPJ had to approve them. 

However, since May 9, 2018, the Harapan government has been in charge of both the federal and Selangor governments and it is really disappointing that little progress has been made in using this prime land that lies between Kuala Lumpur, Petaling Jaya and Shah Alam.

Development of the RRI, now officially known as Kwasa Damansara, will bring billions into the EPF coffers. The EPF is under a duty and compulsion to ensure that Kwasa Damansara is mostly used as a housing scheme for the B40 and the M40 who make up the majority of its contributors and not for mainly high-end housing projects and commercial buildings. What is the EPF waiting for? The lower and middle-income groups are in dire need of affordable housing in the Klang Valley. The EPF has a corporate service responsibility (CSR) duty in making it a reality.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.