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PTPTN's new salary deduction scheme

Dec 06, 2018

There's a lot of opposition to PTPTN's new salary deduction scheme.

Under the mechanism, borrowers will face mandatory salary deductions of 2 to 15 per cent, depending on how much they earn. 

Those who make RM2,000 a month, only have to pay RM40. 

Those earning RM8,000 and above, will have to fork out some RM1,200 monthly.

But is such a scheme legally enforceable?

The Malaysian Trades Union Congress doubts that it is, saying the law only permits mandatory wage cuts for selected statutory bodies such as the IRB, EPF, and SOCSO.

Human Resources Minister, M. Kulasegaran admits this is true, adding that the government will have to amend the relevant laws first, before it can instruct employers to make the deductions.

Meanwhile, the Malaysian Employers Federation says the scheme is complicated and burdensome on private firms.

It adds that it's unlike income tax and EPF deductions, that are applicable to all employees.

The scheme has also been critcised by civil rights lawyer, Syahredzan Johan, who says that it penalises those who are already paying back their student loans regularly.

He also pointed out that many people, including employers, were not consulted when PTPTN came up with the scheme.

Youth and Sports Minister, Syed Saddiq has acknowledged the criticisms, and says he will raise the matter in tomorrow's Cabinet meeting.

"We must repay our loans," stressed Syed Saddiq.

"But at the same time, the payment must be a fair amount, so as to not burden young people, especially those who actually have been repaying their PTPTN loans on time."

"As such, I will bring the matter up to the Cabinet tomorrow," he added.

Meanwhile, PKR President Datuk Seri Anwar Ibrahim says he will soon speak with the Education Minister about the public backlash.