The government has been urged to raise the minimum pension rate for retired civil servants from RM1,000 to RM1,800, ahead of the budget for 2022 which is expected to be tabled not long from now.
National trade union Cuepacs said this would help retirees from the government service keep up with the rising cost of living.
“Right now, many government retirees are facing financial issues because their pension is not enough,” Cuepacs president Adnan Mat told MalaysiaNow.
“They need to pay their home loans and their children’s education expenses on top of buying their daily necessities.”
He said the rising house prices alone would likely result in an extension of loan period until the age of 60.
“This is without taking into consideration necessary expenses like hire-purchase loans for vehicles and so on.”
There are some 700,000 government retirees nationwide, with monthly pension payments estimated at about RM700 million.
On Sept 30, Minister in the Prime Minister’s Department (Special Functions) Abdul Latiff Ahmad said the Public Service Department (JPA) was considering ways to improve pension payments for retired government servants, especially those in the B40 category.
Adnan said Cuepacs had been calling for a review of the pension rate for a long time now.
Before 2009, he said, government retirees who had served a minimum of 25 years only received pensions of RM280 a month because of the low salary scheme for civil servants at the time.
“Our calls were finally heard when the government agreed to raise the monthly pension from RM280 to RM720 beginning Jan 1, 2009.
“From time to time, we continue to negotiate with the government so that pension payments are updated in line with the economic situation,” he added.
On Jan 1, 2012, the government increased the pension of those who had served at least 25 years from RM720 a month to RM820.
“In January 2013, the government announced an increase in pension of 2% a year for all retired civil servants before agreeing to raise the lowest pension rate to RM1,000 in 2018,” Adnan said.
Responding to Latiff’s remarks, he said it was time the government reviewed and improved pensions again in light of the rising cost of living.
“Right now, the lowest pension payment for retirees who served more than 25 years is RM1,000 with the 2% annual increase.
“This means that the minimum increase is RM20 a year. But the cost of living will probably rise by far more than that.”