PETALING JAYA: The government should reassess the benefits and allowances provided to MPs first before applying them to civil servants, including new hires, said Nusantara Academy for Strategic Research senior research fellow Dr Azmi Hassan.
He was commenting on Deputy Prime Minister Datuk Seri Dr Zahid Hamidi’s Jan 24 announcement on introducing a new hiring policy in which civil servants will contribute to retirement schemes like the Employees Provident Fund and Social Security Organisation instead of receiving pensions.
Adding to this, Prime Minister Datuk Seri Anwar Ibrahim said if new civil service hires do not receive a pension, the same should apply to politicians.
Anwar said the proposed move is aimed at addressing long-term fiscal concerns and ensuring the sustainability of current pension obligations.
He also said the government is committed to reviewing and increasing the remuneration rates for civil servants, citing a lack of salary adjustments over the past 12 years.
While expressing support for the transition to a contributory system, Azmi stressed the importance of enhancing the government’s contribution to ensure competitive salaries for civil servants.
On existing compensation for MPs, he said according to the Remuneration Act 1980, they receive a comprehensive package, including a monthly salary of RM16,000 and various allowances that cover attendance at parliamentary sessions and government meetings, entertainment, travel-related expenses, communications and attire.
“In some cases, ex-ministers receive more than one pension. So, the government should be careful before applying any scheme to civil servants.”
Azmi also expressed concern over salaries not being revised for over a decade and said the government should appreciate the loyalty of the 1.7 million civil servants.
“This is distressing. The cost of living continues to rise and places civil servants in a challenging situation of coping with the same income for an extended period.
“If the government fails to carry out a proper salary review, then introducing a contributory pension system for new hires will result in the loss of qualified individuals to the private sector.
“This can potentially hamper policy development within critical sectors such as the Foreign Affairs Ministry and the Armed Forces.”
Monash University economics lecturer Prof Dr Niaz Asadullah said the proposed shift to a contributory pension system is complex and requires careful consideration of its impact on fiscal sustainability, employee welfare and the overall efficiency of the civil service.
He also expressed concern on the potential impact on its influence on job seekers when contemplating public sector careers.
“The move could discourage high-calibre individuals from joining the civil service, leading to challenges in talent retention and a decline in morale.
“When experienced employees retire or move on, having capable new hires will ensure a smooth transition and continuity in organisational leadership and expertise.”
Niaz said without proper adjustments or allocations, new hires, especially those in lower ranks, may face financial hardships after retirement. Hence, the attractiveness of the civil service as a career option may diminish without the pension component.
Niaz said to have a strong and efficient public sector, it is crucial to value the efforts of civil servants as it ensures the continuity and quality of their services.
“If the government moves forward with its reforms, it should maintain transparency, address disparities and ensure competitive salaries as this is crucial to safeguarding the quality and morale of its workforce.”
