LETTER | “Are MPs special?”

That question was posed to a panel of MPs and academics at a recent closed-door forum. The inquirer, a former civil servant, proceeded to challenge parliament for exempting MPs from the pension reform proposed for the civil service, which will replace pension with EPF savings for new public service recruits.

Future first-time MPs, on the other hand, will retain their pension benefits, including the exceedingly generous condition that a mere three years of service entitles MPs to lifelong pension, payable from age 50.

Six years suffices for MPs to get the maximum pension, equivalent to half the last drawn salary. Civil servants must work for 30 years to qualify for the maximum pension (60 percent of the last drawn salary).

The two young MPs on the panel declined to say there’s something special about parliamentarian status, but they declared a willingness to take EPF instead of a pension.

They also opined that removing pensions is stiffly resisted by senior MPs, and putting future MPs on EPF instead of pension would be a hard sell. Alas, reform looks unthinkable.

Parliament is rightfully facing scrutiny for not undertaking the same change it is imposing on the civil service. Morally, they should walk the talk. But there are real constraints, and the problem is less about the hypocrisy of Parliament, and more about the neglect of workable solutions.

There is an alternative and it begins with an affirmative answer to the provoking question.

Three factors

The truth is MPs are special. Indeed, the exceptional nature of their work justifies an across-the-board switch of all MPs from pension to EPF.

Let’s consider three factors that complicate Parliament’s ability to undertake a reform parallel to the civil service – and that provide the rationale for an increase in MP salary and a full migration from pension to EPF.

First, the manner of their appointment – including the uncertainty of their tenure – sets them apart from any employee. MPs are elected by the rakyat, not recruited by managers.

MPs do not enjoy permanent employment, nor even fixed-term contracts. Ideally, MPs work for five years at a go, but the term may be cut short for political reasons. Whether they stand as candidates again depends on their party’s nomination.

I reckon this is one reason for the rule that parliamentarians only need to serve three years to get their pension – that they should not be deprived of it by whims and factors beyond their control.

This exceedingly generous condition is also difficult to deny to newly-elected MPs while giving it to re-elected MPs. If such a policy is implemented, the resulting disparity in benefits could be detrimental to morale. Pension reform for parliamentarians is decidedly a case of all or nothing: either all MPs convert to EPF or none do.

A second factor enters the fray: parity among parliamentarians. MPs’ responsibilities are the same, although they may be ranked by additional roles in cabinet or on committees. All MPs, whether in the first or thirtieth year of service, are paid the same salary (officially termed “allowance”).

In contrast, entrants to the civil service generally start in lower-ranked positions and have the chance to be confirmed and permanently employed, then work their way up. It is acceptable for recruits to be placed on EPF even while their seniors keep the pension plan.

Parliamentarian parity reinforces the difficulty of taking the civil service approach. Rookie MPs will find it unacceptable to be placed on EPF while their returning peers enjoy vastly greater benefits, despite all swearing the same oath of office.

Third, the nature of work and the weight of responsibility of parliamentarians differentiate them from civil servants. They are at the forefront of the legislative branch.

They are called Yang Berhormat because of the honour and importance bestowed on their position and the dignity and diligence expected of their conduct. They are public figures who are expected to lead by example.

The value of parliamentarians’ work should be reflected in the reward. MPs are paid well, on par with top management in the civil service, and they enjoy handsome travel, accommodation and communication allowances, as stipulated in the Members of Parliament (Remuneration) Act.

Multiple pensions

There is a trend of politicians forsaking some public benefit as a show of solidarity with the rakyat. Prime Minister Anwar Ibrahim has proposed a stop to the practice of receiving multiple pensions for those who have held multiple federal or state cabinet posts.

A more systematic and durable policy would be to raise salaries and drop pensions. Parliament should show solidarity with civil servants by adopting EPF en masse, and solidarity with society by relieving taxpayers from the burden of future pension payments.

Of course, MPs currently on track for the pension cannot be hung out to dry. To address the concern about MPs’ retirement income, they can be granted lumpsum payments - possibly into EPF accounts, as a once-off special measure - equivalent to what they would have accumulated. Every MP will receive a fair and commensurate amount.

Many Malaysians find it jarring, even reprehensible, that parliamentarians get to keep their generous pension scheme at taxpayers’ expense while phasing out the civil service pension.

Will the present Parliament find the clarity and courage to live up to their special status?

The author is a senior fellow at the Iseas-Yusof Ishak Institute.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.