The Malaysian Institute of Economic Research (MIER) has urged the government to consider announcing a long term policy direction towards mandatory EPF coverage of all workers in the labour force by implementing a voluntary opt-out mechanism in National Budget 2024.
KUALA LUMPUR: The Malaysian Institute of Economic Research (MIER) has urged the government to consider announcing a long term policy direction towards mandatory EPF coverage of all workers in the labour force by implementing a voluntary opt-out mechanism in National Budget 2024.
MIER has suggested mandatory coverage for formal contract for service workers in the public sector (Employers:2 per cent; Employees: 2 per cent); auto-registration of more than 550,000 Malaysians attaining the age of 18 years into EPF and Perkeso; collaboration with platform providers through auto-registration and auto-deduction mechanisms for more than 300, 000 gig workers to the EPF and collaboration with the regulatory body to auto-register more than 450, 000 informal sector workers, the self-employed and gig workers (non-platform) to the EPF.
MIER said in a statement released today that it is essential to extend the legal coverage of EPF to all workers to improve the social protection scheme.
Additionally, MIER emphasised that it is time to introduce a contributory national pension scheme (CNP), which is a pivotal step in establishing a multi-pillar pension framework.
It said the CNP will be supported by the EPF as a key institution in managing old-age income security risks by providing a basic lifelong income stream for the elderly.
MIER also added that the government should establish a national social protection floor through universal cash transfer programmes.
“The government should move towards universal benefits to strengthen the currently weak social contract and build higher trust levels among citizens.
“The proposed cash transfer programmes will include universal children’s allowance, a payment of RM100 per month per child for all children aged 0 to 17 years old.
“A universal social pension for the elderly, whereby RM100 per month is given for all elderly people aged 70 years and above. This can be accorded to all regardless of socio-economic status,” it said.