When dignified ageing becomes a distant dream

The Star

23-07-2025

Dr Mohammed Azman: Malaysia's retirement model is under strain. PERKESO responds not just with payouts, but with prevention, rehabilitation and reintegration – supporting healthier, longer working lives.
We often speak of retirement as a reward – a well-earned rest after years of contribution. But in Malaysia today, retirement is no longer a guarantee. For many, it is a privilege they may never reach.
As the debate reopens about raising Malaysia's retirement age to 65, the assumption seems logical. Malaysians are living longer and therefore can work longer.
But assumptions are not evidence. And at PERKESO, the evidence tells a sobering story.
Over the last decade, invalidity claims have surged by more than 160%.
In 2023, more than 52 in every 10,000 active workers filed for invalidity. These are not seniors at the edge of retirement. The average applicant is just 45 years old.
This is not about a few exceptional cases. This is a pattern. And it is growing.
What is more alarming is that 85% of invalidity cases paid in December 2024 were due to noncommunicable diseases – diabetes, cardiovascular disease, kidney failure, strokes. These are not injuries. They are conditions caused by years of strain, lack of preventive care and insufficient early intervention.
These are workers who tried to hold on – who ignored the early warning signs, who pushed through pain to keep earning until their bodies gave out well before the system expected them to.
It is easy to argue that Malaysians should work longer. But we must first ask – can they?
Raising the retirement age to 65 without supporting those who exit early is like building a bridge for the lucky few while leaving everyone else to swim across.
And even for those who do make it to retirement age, the road ahead is far from secure.
Malaysia is among only 13 countries in the world that still depends heavily on a pure defined contribution retirement model. That means if you do not contribute, you do not accumulate. If you stop working early, you stop building a safety net.
The EPF savings reality is stark. Nearly 75% of members aged 54 have less than RM250,000 in their accounts. That translates into a retirement income of less than RM1,050 per month – below the national poverty line – hoping to last for the next 20 years. This is not enough to live. It is barely enough to survive.
And that pressure is now showing in the data. EPF health-based withdrawals have risen by 41% since 2015. In 2023 alone, over RM93mil was withdrawn due to incapacitation.
This tells us one thing clearly – Malaysia's retirement model is straining at both ends, under the weight of longer lifespans and the rising rate of early exits due to poor health.
At PERKESO, we have responded not just with payouts but with solutions.
Our Health Screening Programme targets workers aged 40 and above, catching issues before they become irreversible. Our Return-to-Work Programme helps those injured or ill to rejoin the workforce through rehabilitation, career redesign and support. We are not just a compensation agency. We are a partner in prevention, recovery and resilience.
But we cannot outpace the problem if the broader system does not change with us.
We need a national shift. A new vision for retirement that reflects the diversity of real working lives. That includes flexible retirement pathways, partial disability options and minimum income guarantees for those forced to exit early.
We must stop treating retirement as a single number, whether 60 or 65, and instead start recognising that the ability to work is not evenly distributed.
Because not every worker gets to choose when they stop. For many, the body makes that decision long before the law does.
Let us not design systems that reward only the strongest. Let us protect the ones who gave all they could and then quietly faded out of the workforce – unseen, unsupported and too often, unheard.
As the World Social Security Forum (WSSF) draws its curtain on Sept 29 this year in Kuala Lumpur, Malaysia stands at a pivotal crossroads. This global gathering is not merely a stage for policy exchange. It is a test of sincerity.
As host, PERKESO welcomes the world not just with hospitality, but with humility.
This is a rare opportunity for Malaysia to learn from countries with similar economies, shared demographic pressures and comparable cultural values, yet have found innovative solutions without reinventing the wheel.
WSSF allows us to benchmark our systems, challenge our policies and draw collective strength from global wisdom. But more importantly, it is a platform for us to reflect honestly on where we stand and where we must go.
It is a moment to decide whether we are content to manage the present or bold enough to reform for the future.
But to do so, we must deliver justice to the lives that fell into the crack of our system. The ones who never made it to retirement. The ones who endured until they could no longer stand. The ones who should never have been left behind in the first place.
Let us not build a future that works only for the fit and fortunate. Let us build one that holds up the weary. That sees every worker and says, even if you did not make it to the end, you were never meant to be forgotten.
Because in the end, the world needs companion. What is the point of being the last person standing at the end of the line while others did not?
Datuk Seri Dr Mohammed Azman Aziz Mohammed
Group Chief Executive Officer
PERKESO