MTUC urges Malaysian government to raise retirement age, introduce cost of living allowance

With Budget 2020 to be tabled in Parliament on 11 October 2019, the Malaysian Trades Union Congress (MTUC) has called for the introduction of a RM500 minimum monthly cost of living allowance (COLA) for all employees.

It has also proposed for the country's mandatory retirement age to be increased from 60 to 65, according to a Bernama report shared on MTUC's website.

Explaining the need for the COLA, one of the reasons cited by the National Labour Centre was the 'ever-rising cost of living' and a recent United Nations finding that revealed the country has been 'using an outdated and incorrect factor in determining the national poverty line', one of the factors considered in setting minimum wages.

MTUC Secretary-General J Solomon said: "The government must accept that Malaysians in the middle and lower income levels are unable to make ends meet and those with families are actually struggling.

"We are not asking for higher take-home wages; we are only asking for real wage. The UN findings show that the poverty rate is as high as 15% to 20%, and this has direct relevance to low wages."

At the same time, the reasons cited for raising the retirement age included the 'lack of sufficient income to sustain retirement' and the expected increase in the lifespan of Malaysians. In fact, Solomon added that having this increase will help boost EPF savings for lower income workers and senior citizens, thus reducing their dependence on support networks.

In response to this, Human Resources Minister M Kulasegaran shared today that the government will study the proposal to raise the retirement age, as reported in a separate Bernama article.

He said: "We have given our opinion and have forwarded the matter to the finance ministry, including a request to increase the COLA."

Minister Kulasegaran also stressed that raising the retirement age would benefit Malaysia in the future.

"The country lacks workforce, there is no lack of job opportunities. We are taking in a lot of foreign workers because the country does not have sufficient labour force."

Photo / 123RF