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Tuesday December 7th, 2021
Economy

Sri Lanka to raise retirement age for EPF to 60 years for men, women

ECONOMYNEXT – Sri Lanka will raise the retirement age for the purpose of the Employment Provident to 60 years and remove the difference between men and women, Finance Minister and Prime Minister Mahinda Rajapaska said.

He said the retirement ages of men and women were different now with women having a lower age.

The life expectancy of men is 72 and women 77 so having a lower retirement age for women did not make sense, he said.

“Therefore, based on the life expectancy, it is proposed to amend the Employees’ Provident Fund Act to expand the retirement age for both men and women up to 60 years,” Rajapaksa told parliament.

“I wish to also bring to your notice that at the time of the adoption of the Employees’ Provident Fund Act, life expectancy for females was as low as 57.5 years and life expectancy for males was 58.8 years.”

At the moment contributors can get their EPF balances when they retire at the age of 55 years after contributing all their lives to the fund.

State workers get pensions without contributing anything.

It is not clear whether private sector workers will now be blocked from taking the EPF proceeds when they retire at 55.

The state uses EPF funds to borrow at low rate fund the deficit.

The proposal comes as the budget said state workers will be given housing loans at 7 percent.

Sri Lanka’s rulers generally treat private sector workers as second class citizens, critics say.

Sri Lanka’s rules tax vehicles of private citizens at probative rates while giving tax slashed or tax free cars to state workers and the elected ruling class. (Colombo/Nov18/2020)

Comments (10)

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  1. Sachi Kuhananthan, MD says:

    It sounds rational to increase the retirement age because of increasing life expectancy. However with the economic downturn, more young people are without employment. Therefore in the long-term, decreasing the retirement age will benefit the economy and will reduce the unemployment rate.

  2. Eng. Withanage says:

    It is good to make provisions for any employee to leave the employment early as of implemented now (female 50 and male 55) and withdraw funds. This will enable them to invest those funds for any self employment. There are pros and cons in extending the retirement age for the private and government institutions contributing for EPF. It is ok to extend the retirement age then it will enable to retain very productive and experienced employees and in the mean time there are many unproductive employees who will also enjoy this benefit which in turn will be a burden to the economy. This will impact the recruitment of young productive employees who will provide an impactful contribution to the economy. However it is good to have some flexibility with provisions to any female/male employee to retire once they reach 50/55 and extended five years for productive employees to have a choice to reach their retirement age till 60 and enjoy higher retirement benefits. This will make a win-win solution to employee as well as the government. Employees who leave early can use their funds for some useful investment whereas much needed productive employees could continue until 60. I believe this would provide better socio-economic benefits to the country.

  3. Eng. Withanage says:

    It is good to have provisions to withdraw EPF funds for females at 50 and males at 55 though the retirement age is extended to 60. This will enable employees to leave early and invest those funds as they desire for any self employment. This will enable employers to retain most productive employees until 60 and allow other to leave the employment early and withdraw funds once they reach the ages of Female 50 and male at 55. It is no point keeping unproductive employees until 60 like in government sector. Instead more opportunities could be extended to young employees.

    1. Chanaka jayaweera says:

      I am without a job at the age of 48y..and trying to find one in the private sec. My EPF is there but need to have this at the age of 55. This country is going nowhere…shit companies and politicians.

  4. Pakeer says:

    The government gets money shortage to pay EPF. so they try to postpone retirements. this government always tries to steal our hard earn EPF money legitimately. most of the European countries allow work until 60 but with loads of facilities mainly such as good transport and well paid. here 55 is fine.

    1. Sha. says:

      This is only to steal the money. So what ever they should allow the holder to decide after the age of 50 years whether to continue the job or not. Cos some people are having sickness. Employer may not like to keep them. So understand that and think from citizens point of view. Thanks

  5. shamindra senaratne says:

    The changing of retirement age has both pros and cons for employees as well as employers. However, the government should allow EPF to be collected at 55 for the next five years at least. The reason is the employees who are in the age range of 50 to 55 at the moment have based their future plans counting heavily on the EPF funds. The younger ones may have more time in their hands to decide their future based on the EPF that they are entitled to collect at the age of 60.

  6. Leon Joseph says:

    Various views have been expressed since GOSL announced in the 2020 November that retirement age Would be increased to 60 years in the private sector.

    Some people welcomed the proposal. They are people who expect to work up to 60 years of age.

    Some were not happy. Some groups held pickets against the proposal. They are people who wanted to obtain the EPF at 55 years.

    As at now, as per EPF Act, female workers have the option to retire at 50 years of age and obtain EPF at 50 years of age. But they can continue up to 55 if they wish. Men can obtain EPF only after 55 years of age.

    When female workers retire at 50 years, they may or may not get reemployed by an employer. They cannot demand reemployment up to 55 years of age. But employers rehire them after 50 as casuals or on contract basis on less favourable terms.

    Some employees may want to obtain EPF at 55 years. If 60 years of retirement is enacted, men decide to retire at 55 years to obtain EPF, thereafter there can be some disputes regarding terms or gratuity at 60 years (the 2nd period can be below 5 years) / re-employment up to 60 years.

    Suggestions.

    1. When retirement age is enacted and fixed at 60:-
    2. Employees should have the option to retire at 55 or any time between 55 and 60. (The option for women to retire at 50 may be continued – EPF Act)
    3. If some employees want to work up to 60 years and still want to obtain EPF at 55, they should be allowed to continue work without break. But they should be allowed to withdraw 95% of EPF balances lying in their account at 55 or any time between 55 – 58
    4. In this way they can continue to have the same EPF number even after obtaining EPF at 55.
    5. When an employee who withdrew EPF at 55 retires at 60, the employee can withdraw the balance 5% of EPF + new contribution made after 55 years.
    6. Gratuity has to be paid at 60 years or at the age employee retires for good.

  7. waruna liyanaarachchi says:

    when this is going to be gazetted

  8. Roshan says:

    It is likely that this decision is merely to fund the unfunded schemes such as current state workers’ pension and to reduce the current deficit (believed to be the case) of the EPF.

    This fund has not been managed properly by all previous governments. Now, they are going to give another big blow to private sector employees by not allowing them to take their hard earned money at the age off 55.

    If this needs to be fruitful, they must first pass a law in the Parliament stating that all private companies should revise their retirement age to be 60. Otherwise, people will have to retire at 55, but may not be able to get their EPF.

    The government should not forget that it is private sector employees who contributed a lot. Pls do not play with our hard earned money. This is not the fist time our Sri Lankan selfish governments to loot people’ s money.

Comments

Comments (10)

Your email address will not be published. Required fields are marked *

Your email address will not be published. Required fields are marked *

  1. Sachi Kuhananthan, MD says:

    It sounds rational to increase the retirement age because of increasing life expectancy. However with the economic downturn, more young people are without employment. Therefore in the long-term, decreasing the retirement age will benefit the economy and will reduce the unemployment rate.

  2. Eng. Withanage says:

    It is good to make provisions for any employee to leave the employment early as of implemented now (female 50 and male 55) and withdraw funds. This will enable them to invest those funds for any self employment. There are pros and cons in extending the retirement age for the private and government institutions contributing for EPF. It is ok to extend the retirement age then it will enable to retain very productive and experienced employees and in the mean time there are many unproductive employees who will also enjoy this benefit which in turn will be a burden to the economy. This will impact the recruitment of young productive employees who will provide an impactful contribution to the economy. However it is good to have some flexibility with provisions to any female/male employee to retire once they reach 50/55 and extended five years for productive employees to have a choice to reach their retirement age till 60 and enjoy higher retirement benefits. This will make a win-win solution to employee as well as the government. Employees who leave early can use their funds for some useful investment whereas much needed productive employees could continue until 60. I believe this would provide better socio-economic benefits to the country.

  3. Eng. Withanage says:

    It is good to have provisions to withdraw EPF funds for females at 50 and males at 55 though the retirement age is extended to 60. This will enable employees to leave early and invest those funds as they desire for any self employment. This will enable employers to retain most productive employees until 60 and allow other to leave the employment early and withdraw funds once they reach the ages of Female 50 and male at 55. It is no point keeping unproductive employees until 60 like in government sector. Instead more opportunities could be extended to young employees.

    1. Chanaka jayaweera says:

      I am without a job at the age of 48y..and trying to find one in the private sec. My EPF is there but need to have this at the age of 55. This country is going nowhere…shit companies and politicians.

  4. Pakeer says:

    The government gets money shortage to pay EPF. so they try to postpone retirements. this government always tries to steal our hard earn EPF money legitimately. most of the European countries allow work until 60 but with loads of facilities mainly such as good transport and well paid. here 55 is fine.

    1. Sha. says:

      This is only to steal the money. So what ever they should allow the holder to decide after the age of 50 years whether to continue the job or not. Cos some people are having sickness. Employer may not like to keep them. So understand that and think from citizens point of view. Thanks

  5. shamindra senaratne says:

    The changing of retirement age has both pros and cons for employees as well as employers. However, the government should allow EPF to be collected at 55 for the next five years at least. The reason is the employees who are in the age range of 50 to 55 at the moment have based their future plans counting heavily on the EPF funds. The younger ones may have more time in their hands to decide their future based on the EPF that they are entitled to collect at the age of 60.

  6. Leon Joseph says:

    Various views have been expressed since GOSL announced in the 2020 November that retirement age Would be increased to 60 years in the private sector.

    Some people welcomed the proposal. They are people who expect to work up to 60 years of age.

    Some were not happy. Some groups held pickets against the proposal. They are people who wanted to obtain the EPF at 55 years.

    As at now, as per EPF Act, female workers have the option to retire at 50 years of age and obtain EPF at 50 years of age. But they can continue up to 55 if they wish. Men can obtain EPF only after 55 years of age.

    When female workers retire at 50 years, they may or may not get reemployed by an employer. They cannot demand reemployment up to 55 years of age. But employers rehire them after 50 as casuals or on contract basis on less favourable terms.

    Some employees may want to obtain EPF at 55 years. If 60 years of retirement is enacted, men decide to retire at 55 years to obtain EPF, thereafter there can be some disputes regarding terms or gratuity at 60 years (the 2nd period can be below 5 years) / re-employment up to 60 years.

    Suggestions.

    1. When retirement age is enacted and fixed at 60:-
    2. Employees should have the option to retire at 55 or any time between 55 and 60. (The option for women to retire at 50 may be continued – EPF Act)
    3. If some employees want to work up to 60 years and still want to obtain EPF at 55, they should be allowed to continue work without break. But they should be allowed to withdraw 95% of EPF balances lying in their account at 55 or any time between 55 – 58
    4. In this way they can continue to have the same EPF number even after obtaining EPF at 55.
    5. When an employee who withdrew EPF at 55 retires at 60, the employee can withdraw the balance 5% of EPF + new contribution made after 55 years.
    6. Gratuity has to be paid at 60 years or at the age employee retires for good.

  7. waruna liyanaarachchi says:

    when this is going to be gazetted

  8. Roshan says:

    It is likely that this decision is merely to fund the unfunded schemes such as current state workers’ pension and to reduce the current deficit (believed to be the case) of the EPF.

    This fund has not been managed properly by all previous governments. Now, they are going to give another big blow to private sector employees by not allowing them to take their hard earned money at the age off 55.

    If this needs to be fruitful, they must first pass a law in the Parliament stating that all private companies should revise their retirement age to be 60. Otherwise, people will have to retire at 55, but may not be able to get their EPF.

    The government should not forget that it is private sector employees who contributed a lot. Pls do not play with our hard earned money. This is not the fist time our Sri Lankan selfish governments to loot people’ s money.