MTUC: Raise mandatory retirement age to 65 and RM500 COLA

MTUC: Raise mandatory retirement age to 65 and RM500 COLA

PUCHONG: A raise in the mandatory retirement age to 65 and a minimum monthly cost of living allowance (COLA) of RM500 are among Malaysian Trade Union Congress’ wish list for Budget 2020.

Both are indications of a dire need for people-centred programmes that provide for the protection and uplifting of economic conditions of the population’s bottom half, said MTUC secretary general, J Solomon.

“The need for the COLA is justifiable based on the ever-rising cost of living and the recent finding by the United Nations whereby Malaysia has been using an outdated and incorrect factor in determining the national poverty line,” he said in a statement.

Both the proposals were put up due to the lack of sufficient income to sustain retirement, even as the Malaysian lifespan is expected to increase in the future to 80 years on average.

“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 per cent, and this has direct relevance to low wages,” he said.

The unionist also told Putrajaya to take the Bank Negara’s report into consideration. The central bank found that a working bachelor in Kuala Lumpur needs a minimum of RM2,700 a month to enjoy a decent living, whereas a married couple with two children has to earn about RM6,500.

“The current salaries for many Malaysians are far below these amounts. It is now timely for the Government to consider the real living wage. It is also their key responsibility to lower the cost of living to enable sustainability, but historically whatever commodity that went up in prices never came down.

“The private sector has no valid reason to delay as they have enriched themselves from this for many years, and consequently caused wide income inequality in Malaysia. It is their moral obligation to compensate the workers who have been short-changed and made to suffer for many years,” Solomon said.

“Therefore the introduction of COLA would be an effective move to address the current income disparity and the pittance minimum wage, as it will strengthen the aggregate demand and boost economic growth in the process.

“With the current low wages and the high cost of living, workers are in a ‘make or break’ situation. The RM500 would be a major boost for the B40 and M40 category of workers who are the hardest hit,” he said.

As for the higher retirement age, Solomon said that it would boost Employees Provident Fund (EPF) savings for those in the lower-income category as well as senior citizens, who could then depend less on their children, society and the government for old-age support.

“We propose the extension of retirement age be optional and at the same time the EPF withdrawal should also be optional at the age of 55.

“For those who withdraw at 55, they will still have continuous savings up to 65 years of age with the extension of the mandatory retirement age,” he said.

Four other  proposals put forth by the national union group are:

  • introduction of human and workers’ rights into the current syllabus for secondary and tertiary education
  • enhancing accessibility to vocational programmes and increasing collaboration between industries and vocational providers
  • providing security of tenure in employment for workers in facing the Industrial Revolution 4.0.
  • enhancing employee welfare and employment opportunities.