KUALA LUMPUR, March 6 — The Retirement Fund Inc’s (KWAP) total gross fund size has reached RM190.3 billion as of last year, following adjustment for a cumulative withdrawal of RM20.5 billion for the partial funding of the government’s annual pension duties since 2018.
The Finance Ministry (MoF) said its unaudited consolidated fund as of December 31, 2023, amounted to RM169.8 billion, a growth of 305 per cent for a compound annual growth rate of 9.0 per cent since its inception on March 1, 2007.
As a long-term institutional investor, KWAP’s investment objective is to seek maximum returns on investment on a sustainable basis through dynamic investment strategies in line with the fund’s risk appetite.
“With regard to this, KWAP has not been given the mandate directly to reduce the fiscal implication towards the civil servant pension allowance.
“Nevertheless, KWAP’s consolidated fund can be applied towards meeting the government’s liability on the cost of annual civil servant pension remuneration via the fund withdrawal mechanism as provided in Act 662’s subsection 13(5),” it said in a post on the Parliament’s website today.
MoF was responding to Paya Besar MP Datuk Mohd Shahar Abdullah’s query on whether KWAP’s performance could reduce the fiscal impact on civil servant pension allowance.
“Basically, KWAP’s consolidated fund growth can be linked with consistent investment returns where funds had generated average annual returns of 6.3 per cent since its inception.
“This achievement is based on dynamic investment strategies spearheaded by the Strategic Asset Allocation,” it said.
Shahar also asked if the government had plans for the Employees Provident Fund (EPF) to alter its focus from retirement-based benefits to a comprehensive social security scheme.
In response, MoF said that currently, the EPF will continue prioritising implementing its mandate to ensure Malaysians’ well-being in their old age, ensuring a more effective implementation of the country’s social security framework.
— Bernama
