EPF calls for pension system reforms to secure lifelong retirement income

KUALA LUMPUR, 2 OCTOBER 2026 —

Malaysia’s Pension System Urgently Needs Reform as Longevity and Work Patterns Reshape Retirement Security, EPF CEO Warns

EPF CEO Ahmad Zulqarnain Onn, speaking at the International Social Wellbeing Conference (ISWC) 2026 in Kuala Lumpur, said the system must shift from saving for retirement to guaranteeing lifelong income—while addressing gaps in coverage, wage stagnation, and the need for cross-sector collaboration in healthcare, housing, and elderly care.

The urgency stems from demographic shifts: as Malaysians live longer, the existing framework risks leaving millions—particularly informal workers, daily wage earners, and older employees—without sustainable retirement security. With over 26,000 members already opting for the i-Emas withdrawal scheme by June 2026, the EPF’s push for reform signals a recognition that the current model, while popular, may not suffice for a population with extended lifespans.

Ahmad Zulqarnain outlined four critical priorities. First, he stressed the need to transition from lump-sum withdrawals—a system deeply ingrained in public sentiment—to a model that ensures income security throughout retirement. "We have a lump-sum withdrawal system today, and that is a challenging system, but it’s also one our members hold very dear to," he acknowledged. "The challenge is how we move from saving for retirement to securing income for life."

Second, he highlighted persistent coverage gaps, particularly among informal-sector workers, daily wage earners, and older employees who often fall outside formal pension protections. The EPF CEO argued that support must extend beyond retirement, requiring early engagement and coordination across health, housing, and elderly care—delivered gradually and transparently to maintain public trust.

Third, Ahmad Zulqarnain pointed to Malaysia’s stagnant wage growth, noting that the share of GDP allocated to labour remains too low. "Labour market reforms are essential to improve wages for Malaysian workers," he said, framing higher compensation as a cornerstone of long-term retirement security.

Finally, he emphasised that longevity cannot be addressed by any single policy area alone. Instead, it demands integration across labour markets, infrastructure, healthcare, digital systems, and community development. "Income security, health, care, work, and community all shape how well people live longer lives," he stated. "The task now is to connect all these pieces together."

The EPF CEO also underscored the need for shared responsibility, with individuals, families, employers, communities, and the government each playing distinct roles. "The government will need to take a stronger role, especially in long-term care and basic income security," he said. "Individuals must prepare early, save consistently, and make informed choices. Employers must provide fair wages, workplace flexibility, and opportunities for older workers to remain economically active."

The call for reform gained further traction during a panel discussion on innovating retirement wellbeing, moderated by EPF Chief Digital Technology Officer Afhzal Abdul Rahman. Panelists—including Naluri Group CEO Azran Osman-Rani, Health Ministry Health Transformation Office CEO Dr. Yap Wei Aun, and Fourier Intelligence’s Owen Teoh—stressed the need for a more holistic approach.

Currently, healthcare, retirement savings, employers, insurers, technology providers, families, and communities operate in silos, they argued, leaving gaps in support for ageing Malaysians.

Dr. Yap cited the standardised voluntary private health insurance initiative as a model for cross-sector collaboration, shifting focus from expenditure to value-based healthcare, prevention, and health outcomes. "We need to move beyond fragmented systems," he said, "and ensure that retirement, healthcare, and income security are aligned."

The conference, jointly organised by the EPF and the Finance Ministry, brought together global thought leaders, policymakers, and industry experts to explore the future of retirement, ageing, and social protection. Key themes included rethinking ageing and longevity, strengthening retirement and healthcare systems, building inclusive communities, and leveraging innovation to support ageing societies.

In the closing session, Alex Sheen, founder of the social movement "Because I Said I Would," reinforced the importance of personal commitment and collective responsibility. "Preparing for an ageing society goes beyond policies and systems," he said. "It requires individual choices, compassion, and communities where people can age with dignity and purpose."

With Malaysia’s population ageing rapidly, the EPF’s reforms—if implemented—could redefine retirement security for generations. The next steps remain unclear, but the conference’s discussions signal a growing consensus: without urgent action, the current pension system risks leaving millions vulnerable in their later years.

Related: Employees Provident Fund (EPF) · Finance Ministry · Ahmad Zulqarnain Onn · Kuala Lumpur