No additional allocation involved in restoration of civil servants’ pension scheme

PUTRAJAYA: The restoration of the pension scheme for retired civil servants will cost the government RM1.3bil, says the Prime Minister.

However, Datuk Seri Anwar Ibrahim explained that the amount was not an additional allocation that the government had to fork out.

"The amount has already been allocated in Budget 2023," he said on Thursday (July 13).

On Wednesday (July 12), the Prime Minister said that the government would restore the previous pension scheme for retired civil servants following a Federal Court decision last month.

Anwar said a special assistance payout called the Special Appreciation for Pensioners (PKKP) would be disbursed to make up for the difference in the pension sum received by civil servants who retired before 2013.

They would have their pensions restored to the amount they received before December 2012.

Those who retired from 2013 onwards will have their pensions restored to the amount they received at the time of retirement.

On June 27, the Federal Court in a unanimous decision, dismissed the government's appeal against the Court of Appeal's decision in January 2022 to declare that amendments made to the Pensions Adjustment Act in 2013 – where pensioners were given a 2% increment annually – was less favourable to retired civil servants.

The now-restored scheme adjusts or increases the pensions each time the government declares a salary revision for civil servants.