Based on checks on the new MyPesara app, the revised pensions indicate that the government has also included the 2% compounded annual increment given out from 2013, which was declared unlawful by the Federal Court last year.
The government stopped paying the increment this year following the apex court’s decision, but is continuing to pay out the accumulated sum as a special incentive payment to civil servants.
However, pensioners who retired before 2013 claim their pension rates are still based on their basic salaries which were last revised 11 years ago instead of the new salaries under the SSPA.
A teacher who retired in 2010 said his monthly pension payment increased by RM250, an 8% hike from his pension in 2013, which was based on the DG41 scale then.
Under the SSPA, the basic salary of the grade he retired in is much higher.
“My grade is now DG12 under the SSPA and the basic salary is at least RM2,000 higher than the one I retired on. Based on this, my pension payments should be at least RM1,000 higher per month.
“The Federal Court in its decision ruled that all pension calculations must be based on the current salary scale of a particular grade. All of us who retired before 2013 are in the same predicament,” he told FMT.
Post-2013 retirees in similar predicament
Another ex-civil servant, who retired two years ago, said he too received an increment based on his pre-SSPA last drawn basic salary, instead of the new salary levels under the new remuneration system.
“Many in our pension groups are in the same category. By right, pensions should be adjusted according to the new salary structure in the SSPA,” he said.
FMT has reached out to Dr Zaliha Mustafa, the minister in the Prime Minister’s Department in charge of the public services department (JPA), for comment.
The Federal Court ruled last year that a 2013 amendment to the Pensions Adjustment Act 1980 put former civil servants in a “less favourable situation” with regard to their entitlement to increments in their pension.
Dismissing an appeal by the JPA director-general and the government, the apex court declared the amendment, which came into effect on Jan 1, 2013, null and void as it infringed Article 147 of the Federal Constitution.
The Federal Court went on to order the reinstatement of the original Section 3 of the Pensions Adjustment Act 1980. The annual 2% increment given to pensioners from 2013 was declared unlawful.
Under the old scheme, the pension of government retirees was based on the prevailing salary of incumbent civil servants in that grade. However, in 2013, a new scheme was introduced based on a flat annual increment rate of 2%.
In a separate suit filed in the High Court in February this year, pensioner Aminah Ahmad is seeking to compel the government to expedite adjustments to pensions in accordance with the apex court’s ruling. The decision will be announced on Jan 16 next year.
Another pension suit filed by a group of armed forces personnel on the same issue is still pending in court.