Pensioners fret as govt stays silent over new rates

 

There’s an air of excitement among the civil servants and members of the uniformed services as they wait with anticipation for their salaries next month, when the new remuneration scheme for civil servants will be implemented.

They will all enjoy the initial 7% pay rise across the board, from directors-general to office boys. After a year, from January 2026, they will all receive a further 8% raise under the second phase of the revision.

While they have every reason to be happy, taxpayers can only hope for better services, especially when it comes to those manning counters and processing approvals, areas which give rise to most complaints.

But it is a different story with the estimated 900,000 pensioners who are waiting agonisingly for a clarification on their plight. Will their pensions be revised in accordance with the new pay scale?

Or will the annual 2% increase given from 2013, now declared unlawful by the Federal Court, be included in their pensions? They have been told unofficially that this will be included for now and be named as an incentive payment but nothing is certain.

Tight-lipped officials

According to some retirees, the Malaysian Government Pensioners Association had met with the pensions department head and his officers last month but they were apparently tight lipped.

The pensioners have been told to wait for the next payouts on Dec 22 to see what’s in store.

Let us get one thing clear here. We are talking about pensioners whose ages range from 60 to 90 or even higher in a few cases. Most of them depend on their pensions to make ends meet. So pensions matter a lot to them.

For many of them, the total annual increases from 2013 onwards amount to several hundred ringgit and they are used to receiving and spending the money for their daily needs.

So, they are asking if the increments, given until last year when the court decided it was against the Pensions Act, will be removed once their new pensions go above what they get now.

Numbers do the talking

Here’s an example that’s causing much uncertainty, especially with the silence from the pensions department.

A civil servant who retired in 2015 on a basic salary of RM5,000 after 30 years of service would have a pension amounting to 60% of the last drawn salary or RM3,000 per month.

The 2% annual increment would have been RM60 a year. For the eight years until 2023, he would have got an additional RM480 or more as the calculation is compounded. This means the pension he receives now is RM3,480.

Under the revised salary scheme (SSPA), the new basic pay for this category would be raised by 7% in December to RM5,350. Based on this, the pension will be RM3,210. So, this is bound to be lower than what they are getting now with the annual increments included.

The only consolation is that they have been told that the total increment so far would continue to be paid out for next year as an incentive payment.

The next step

So, what happens to their new pensions? Will this payment stop once their next revised pensions go above what they are receiving now?

Come January 2026, the new salary level of RM5,350 will be further increased by 8% to RM5,778. The pension based on this salary will go up to RM3,466 – still lower than the RM3,480 which includes the total annual increments.

If this is the case, the government will have to continue giving out the increments as incentive payments until a time the amount crosses what they are getting now.

Don’t forget, a couple of groups have also won their court cases against the government, which requires the pensions department to revise their pensions to reflect the increased salaries for civil servants over the last 10 years.

This is going to cost billions of ringgit if and when implemented.

Does it not sound like a huge mess? It does to me and the government has to be honest and have the courage to do what is right and not be swayed by emotions or political considerations when it puts its foot down.

With pensions costing the government more than RM32 billion annually and rising gradually, it will be wrong to place this heavy burden on taxpayers, most of whom are not government servants.

In the meantime, there is an urgent need for the pensions department or the Public Services Department to clarify and calm the nerves of these senior citizens who appear restless in some chat groups where there appears to be a lot of misinformation circulating. - FMT

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.