New civil service pension scheme still at proposal stage, says PM

KUALA LUMPUR: Prime Minister Datuk Seri Anwar Ibrahim clarified that the proposed new pension scheme is not yet finalized and requires parliamentary approval due to the need for amendments to the Constitution.

He responded to concerns raised by the Council of Former Elected Representatives (Mubarak) regarding the potential removal of pensions for elected representatives after completing their terms.

Several Members of Parliament have suggested the removal of their own pensions in order to ensure that lower-ranking civil servants can continue to receive theirs.

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According to Anwar, the proposal for the new pension scheme aims to establish new rules for future positions, including political positions, as the Constitution does not allow the termination of existing agreements.

Anwar emphasized the need for amendments to existing laws and regulations to implement the new pension scheme, as the government is bound by legal and constitutional constraints.

He also noted that some ministers and MBs have expressed their willingness to forego their pensions, adding that it is up to them to make that decision.

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Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi had previously announced the government’s plan to introduce a new civil service hiring policy that incorporates a revised pension scheme.

Under this proposal, traditional pensions would be phased out in favor of increased contributions to retirement schemes such as the Employees Provident Fund (EPF) and the Social Security Organisation for new hires.

The Prime Minister affirmed that any decision resulting from the review of the public service remuneration scheme would also be applicable to politicians.

Several MPs have expressed their willingness to forgo their pensions, but have urged the government not to cut pensions for civil servants, particularly those in lower-ranking positions.