EPF dividends actually do not 100% correlate with actual income generated and asset valuations. Have a look at past years, look at their asset allocations, look at how much income they've generated for the year, and divide that by AUM for that year (net expenses). They don't payout everything. Why? They are not an actual fund.
They smoothen out the income over years to manage income/valuation volatility, because
- there are no "unit prices" in epf. Hence, your capital is "guaranteed/protected"
- they want to reduce the shock in market downturn. In years with covid, GFC with significant downturns, the underlying asset classes produced losses. But they used retained earnings from previous years to pay out a consistent dividend each year