ACCOUNTS clerk Shalina Amin, 28, looks forward to taking home extra money in her pay packet when her contribution to the Employees Provident Fund (EPF) is slashed to 8% from 11% next January.

'As you know, the cost of living is high now, and my monthly expenses have gone up tremendously in the last year. Having extra money in my pocket will really help,' says the mother of two.

However, with her basic monthly salary at RM1,400, it means that the extra Shalina would receive is about RM42.

The amount is small, she admits, but it is better than nothing.

The cut in employees EPF contribution by 3% will increase disposable income and thus stimulate domestic consumption and support economic growth.

The response to the measure, however, has been mixed.

For many in the lower income bracket, the cut is welcomed but most agree that it is too small to be of real help.

For Shalina, the extra money will mean the ability to pay their utility bills on time and prepare for emergencies, not buy more things.

'What will help more is if prices of goods are reduced some more. Can the Government do that?' she asks, adding that despite the lowering of petrol prices recently, the prices of other goods and services have not come down.

Rock quarry worker Azizi Osman, 32, also welcomes the cut in EPF, only because in the last year, his wages have been reduced a lot due to the reduced market demand.

'My basic pay is RM49.50 per day and I was able to take home up to RM1,500 with overtime. But in June, we were told that we couldnt do any overtime; recently, they told us that from next January, we can only work four days a week because orders for our product have gone down. So yeah, whatever extra money we can get will be good,' he adds.

What is guaranteed is that a reduction in the monthly contribution will mean less retirement savings. And as EPF and other concerned parties have often forewarned, most Malaysian workers have insufficient savings to see them comfortably through their old age.

Sales manager M. Anucia, from Penang, says that she is worried her retirement savings will be inadequate if her EPF contribution is reduced.

Anucia, 33, who earns around RM3,200 per month says the amount received from the reduction is too small to help cover her monthly expenses but if left in the EPF savings, will grow into a substantial sum.

'If I take the 3%, it means I have an extra RM96 but that money will be used up just like that, especially now with high prices of things. I spend about RM88 a month on my babys milk formula and RM120 on her nappies. So yes, I can use it to help cover that cost but at the end of the day, it will go in the rubbish bin. Now, if I keep the money in EPF, it will earn about 5% a year and by the time I retire, Ill have thousands,' she shares.

Another objection to the EPF reduction measure, which will be effective from January 2009 to December 2010, is the proposed procedure: automatic reduction unless the contributor fills up a form to maintain their contribution at 11%.

One irate contributor, a private college lecturer who only wants to be known as Lee, 39, stresses that EPF should promote saving, not spending.

'The main purpose of EPF savings is to assure that all members can afford a reasonable quality of life upon their retirement. The EPF must protect members interests, not the countrys.

'At the very least, they should advise us on the pros and cons of a reduced deduction,' he argues.

Lee feels that the EPF should reconsider their procedure.

'If it is not a compulsory deduction, the better way would be for members who require the reduction to fill in a form, not the other way around!' he says.