Has our CPF Ordinary Account’s interest rates been beating inflation, historically?
I refer to the article “Malaysian pension fund set to make record payout” (Straits Times, Feb 10).
It states that “”We have been informed it will definitely be higher than before,” an EPF board member told The Straits Times ahead of Saturday’s (Feb 10) expected dividend announcement.”
The EPF, which manages RM800 billion in assets, declared a dividend of 5.7 per cent last year and 6.4 per cent in 2016, with total payouts amounting to RM37 billion and RM38 billion, respectively.
EPF chief executive Shahril Ridza Ridzuan has also said last month that the country’s largest asset manager is set to continue a five-year track record of beating inflation by at least 3.5 percentage points, far surpassing its self-imposed target of a minimum real dividend of 2 per cent.
He said this just before Malaysia revealed that last year’s inflation was 3.7 per cent. This means that the EPF dividend would have to be at least 7.2 per cent to match the fund’s performance in the past five years.”
Why is it that our CPF interest rates historically, are so much lower than EPF’s?
Leong Sze Hian