Retirees fret as uncertainty swirls over pension rate

 

Putrajaya spends RM31 billion on the pensions of more than 900,000 retirees, including those who served in statutory bodies and the security forces.

PETALING JAYA: Uncertainty over whether government retirees will continue getting current pension amounts or revert to pre-2013 figures from next January is causing anxiety among some 900,000 pensioners.

The association representing the retirees – Persatuan Bekas Penjawat Awam & Swasta Malaysia (Pejasma) – said their fear had been heightened because the matter was not addressed in the 2024 budget.

It said the pension services department, too, had failed to clarify the issue although there remained only a month before the year end.

A pension department official, when contacted, said they were unable to make an official statement on the matter.

“We will be submitting a report on the new remuneration system (NRS) and pension to the prime minister soon,” the official told FMT, declining to say if the pension amounts in January 2024 would remain the same.

The Federal Court ruled in June that the 2% annual increment given over the last 10 years to pensioners, following an amendment to the Pensions Act in 2013, was null and void.

In an immediate response at the time, Prime Minister Anwar Ibrahim said retirees would continue to be paid the current pension amount, and that the difference between the current amount and the original figure would continue to be paid in the form of special aid known as special recognition for retirees.

However, the public services department’s frequently asked questions section said the special payments would not continue in January 2024, effectively meaning that pensions will be reduced.

Pejasma president Azih Muda said although the government had said that the new pension rates would be adjusted once the civil servants’ NRS is revised, it had not said if the current amounts would continue to be paid until the NRS revision is complete.

“We have only a month left before the year ends. Pensioners are anxious because the 2% annual increment adds up to several hundred ringgit for most of them. Of course, it could be more than a thousand ringgit for those receiving high pensions.

“A pensioner who received RM2,000 a month in 2013 now receives RM2,400. So can you imagine suddenly suffering a RM400 cut? It would be totally unacceptable even if it’s until the NRS is revised. This might even take about a year,” he said.

Meanwhile, a source said that whatever the ultimate decision, the annual 2% increment would be stopped in line with the court decision.

According to government records, it spends RM31 billion on the pensions of more than 900,000 retirees, including those who served in statutory bodies and the security forces.

There are an estimated 32,000 new retirees every year. - FMT