Current govt pension scheme a ticking time bomb, says KJ

 

Khairy Jamaluddin reiterated that he was not calling for current civil servants’ pensions to be abolished, but for a new system to be implemented for all future recruits into the civil service. (Bernama pic)

PETALING JAYA: Reforms must be made to the government’s pension system urgently or things will get worse in the future for Putrajaya’s finances, says former minister Khairy Jamaluddin.

Khairy said Putrajaya forked out about RM30 billion to pay pensioners in 2022, making up nearly 10% of the government’s expenditures in its annual budget.

The ex-Rembau MP also pointed out that former prime minister Ismail Sabri Yaakob had said that pension payments are expected to reach an estimated RM46.6 billion in 2030.

“Therefore, this is a ticking time bomb if nothing is done,” he said, in an episode of the Keluar Sekejap podcast which he co-hosts with former Umno information chief Shahril Hamdan.

The former Umno Youth chief reiterated that he was not calling for current civil servants’ pensions to be abolished, but for a new system to be implemented for all public servants hired in future.

“I’m talking (only) about those who have yet to join the civil service. So that in future, the pensions scheme should be abolished and perhaps a new system implemented.

Khairy reiterated his proposal for all future recruits into the civil service to contribute to EPF rather than being paid pensions.

However, he said there could be some exceptions to the rule for certain groups of civil servants, such as doctors, teachers, nurses, and those who are in the lower grade.

“For a civil servant who either dies or injures himself in the line of duty, maybe for such cases, pension can be given. For lower grade civil servants, maybe the government can ‘top up’ for them so they will be taken care of when they retire.

“Thirdly, for those who are critical civil servants, such as doctors, teachers, and nurses, maybe we can give a new scheme for them,” said Khairy, who was the health minister under the previous administration.

He added that he had already raised the matter at a Cabinet meeting in 2015, when he was youth and sports minister, which meant that “there are people looking into” the issue.

On Wednesday, Cuepacs rejected proposals to do away with or reduce the pension benefits of civil servants, describing such suggestions as “absurd and unwarranted”.

Its president, Adnan Mat, said pensions should be regarded as a form of recognition for civil servants’ services and contributions, rather than a burden on the government. - FMT