Media statement
by Ronnie Liu Tian Khiew
on Wednesday, 09 October 2002
in
Petaling Jaya
Ordinary Malaysians have at least another two bad news to worry about
I am referring to the impending price hike in petrol and diesel, and the
anticipated lowest EPF dividends in history as announced by the "outgoing"
Prime Minister.
The price of petrol is expected to increase by another 6 sen per litre any
time from now, while the EPF annual dividend to its 10 million
contributors would go lower than the all-time-low 5% declared in 2001.
Malaysia is lucky to possess a good reserve of petroleum, but we
Malaysians never seems to benefit from it, whether in good times or bad
times. All we hear is petrol earnings were being used to bailout cronies
and privatised projects that turned sour. Now that the government is
hard-pressed for money, they are talking about taking away the subsidies
on petrol and diesel. No one, excepts the Prime Minister himself , would
know how much we have made from the petroleum and gas, and how much has
been spent in bailouts and mega projects, and how much is left in the
Petronas coffer after all these years.
And the story on EPF dividend is another sad one. The Prime Minister
hinted yesterday that members could again receive a lower dividend payout
this year. He said the current low earnings from investments in the stock
market had made it impossible for the EPF to announce high dividends. The
EPF declared a 5% dividend last year, the lowest since 1967 and less than
the 6% declared in 2000. He also said that nobody should expect high
dividends every year irrespective of the performance of the economy.
While we agree with his argument that nobody should hold such high
expectations in times like this, we have to point out to Dr Mahathir
Mohamad that he has not been honest to Malaysians as he failed to admit
that the EPF Investment Board has not been very professional and prudent
in their investment. It is a known fact that EPF has been investing in
portfolios and companies owned by the BN politicians' cronies and
associates. The 10 million EPF contributors would not stand to lose so
much in dividend payout if not for these poor and irresponsible management
of funds on the part of the EPF investment panel and other relevant
authorities.
I also wish to urge contributors to think again if they believe that they
have not much to lose if the rate is to go down just another 1 percent.
For a contributor who has RM200, 000 with the EPF currently, he or she
stands to lose RM 2, 000 (1% of RM200, 000) in the first year if the
dividend is to be slashed from 5% to 4%, and thereafter lose even more in
compound interests. He or she would end up suffering a loss of RM29, 730
in just 10 years if the EPF dividend rate were to reduce by only 1 %.
Instead of getting RM325, 779, he or she would only get RM 296,049. And
this figure has not include his or her annual contributions. (One has to
remember that the principal sum of any amount would have doubled in 7 to 8
years if you base on compound interest of 10% per annum).