A study on increasing the contribution rates of the Employees Trust Fund (TAP) and the Supplemental Contributory Pension (SCP) is underway and will soon be announced once approved by stakeholders.
This is to ensure that members of the schemes will receive sufficient pension at retirement.
The Minister at the Prime Minister’s Office and Minister of Finance and Economy II Yang Berhormat Dato Seri Setia Dr Awang Haji Mohd Amin Liew bin Abdullah shared this at the 16th Legislative Council (LegCo) meeting yesterday in response to the proposal put forward by LegCo member Yang Berhormat Pehin Orang Kaya Pendikar Alam Dato Paduka Seri Haji Hasrin bin Dato Paduka Haji Sabtu.
Eariler on, Yang Berhormat Pehin Orang Kaya Pendikar Alam Dato Paduka Seri Haji Hasrin explained that there were a few members of the TAP Scheme and the SCP trust order who had insufficient funds to sustain the current lifestyle or to meet the household needs during retirement.
“And what is feared is that when this happens, the pensioners will have to seek government assistance for their household expenses and their dependents upon retirement,” he added.
He proposed that the mandatory rates contributed by members and the government ‘top-up’ to be increased. “Even with a slight increase, it would eventually contribute to a greater amount of retirement funds and provide a more comfortable retirement life for members.”
He lauded TAP initiative to encourage employees or employers may, on top of the contribution, opt to contribute more than the rate prescribed on a voluntary basis.
In response, the minister is aware of the insufficient funds with the current rates. “It is not enough and is an issue we are currently working on.”
He added that the ‘government top-up’ was not the solution to the issue and that ‘voluntary contribution’ was only applicable to certain individuals.
“This is an issue that the Ministry of Finance and Economy is working with TAP to find ways for members aged 55 or 60 years to receive enough pension to sustain their current lifestyle or to meet their household needs during retirement,” said the minister.