PETALING JAYA: The Congress of Unions of Employees in the Public and Civil Services (Cuepacs) has proposed that the new pension scheme needs to be refined to ensure retirees can maintain their livelihood after reaching retirement age.
Hadi Fazli Rusli, 38, an information officer at the Natural Resources and Environmental Sustainability Ministry, said although he supports giving civil servants the option regarding their pension payment, the government needs to clearly define the new mechanism on how the pension will be distributed.
“Yes, everyone should have the right to choose. Some prefer to receive their pension in a lump sum, while others feel more secure with monthly payments,” Hadi Fazli told theSun when contacted yesterday.
He said people have their own method of financial planning which differs depending on their needs, adding that those suffering from critical illness might prefer to get a lump sum payment to support their medical treatments.
“But there should be a plan on how to distribute the payment, whether there are certain amounts that are agreed upon by civil servants or whether it would be calculated based on years of service.”
Perak RTM deputy director Mohd Zam Ali, 50, meanwhile, said Cuepacs’ proposal should be studied carefully to ensure the livelihood of the future batch of civil servants.
Likening it to the Employees Provident Fund (EPF) withdrawal, Mohd Zam warns that financial planning is important for those who favour a lump sum pension payment.
“It is better to be prudent with your spending as there are some who can empty their bank account just months after getting hundreds of thousands of ringgit,” he said.
A policeman, who only wished to be known as CR, echoed Mohd Zam’s remark, that the financial mindset of the younger generation nowadays is worrying.
“They would rather spend on gadgets and fancy vehicles than plan for their future. The Malaysian life expectancy is increasing and they need to be mindful of how they want to live their life after retirement,” said the 59-year-old.
Public Service Department (PSD) director-general Tan Sri Wan Ahmad Dahlan Abdul Aziz had reportedly said the new pension scheme, to replace the current one, is expected to maintain the monthly pensions payment. He said it can help protect retirees from falling victim to scams, while ensuring their retirement savings are managed more efficiently.
Subsequently, Cuepacs proposed that permanent appointees under the new system be given monthly basis or lump sum options for their retirement payments, subject to conditions and eligibility. Its president Datuk Dr Adnan Mat said it was one of three proposals in response to the PSD plan to retain the monthly payment under the new scheme. The second proposal is a hybrid scheme to allow partial lump sum withdrawals with the balance paid out monthly, while the third calls for ensuring government contribution rates are sufficient to cover retirees’ basic needs.
