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Free Malaysia Today
24-05-2025
- Business
- Free Malaysia Today
Cuepacs proposes hybrid system for withdrawal of retirement savings
Yesterday, the director-general of public service stated support for retaining the monthly pension payments, citing cases of pensioners falling victim to scams as a key concern. PETALING JAYA : The umbrella body for civil service unions has proposed a hybrid system where part of the retirement savings can be withdrawn upfront, while the remainder is paid monthly. The proposal by Cuepacs president Adnan Mat follows a suggestion by another association for civil servants, Persatuan Pesara Kerajaan dan Swasta (Pejasama), that pensioners under the public service remuneration system (SSPA) be given the option of receiving their pension either as monthly payments or a lump sum upon retirement. Its president, Azih Muda, said such flexibility was necessary as some retirees might prefer access to a large sum of money to make significant purchases after completing their service, in response to the proposed reforms to the SSPA, which is expected to retain the monthly pension payment model. Adnan agreed with Pejasama's proposal. 'These options would help preserve long-term financial security while offering flexibility based on the needs and preferences of civil servants,' he said in a statement. Yesterday, public service director-general Wan Ahmad Dahlan Abdul Aziz described the proposal as a proactive move, citing cases of pensioners falling victim to scams as a key concern, along with the need to manage retirement savings more efficiently. Today, Adnan said Cuepacs supported the public services department's proposal to maintain monthly payments for civil servants under the SSPA. He described the move as a positive step towards ensuring income stability after retirement, despite civil servants no longer being part of the conventional pension model. 'Any new mechanism must be based on the principle of 'no lesser benefits' compared to the current pension scheme to ensure retirees' welfare remains protected.' While reaffirming that the existing pension scheme remains the best system to guarantee long-term welfare, Cuepacs acknowledged that the government's fiscal constraints make it difficult to sustain the traditional model for future appointments. Cuepacs also noted that some civil servants may prefer a lump-sum payment similar to the EPF system, but argued that monthly disbursements are more structured, secure and reduce the risk of financial mismanagement.
Free Malaysia Today
16-05-2025
- Business
- Free Malaysia Today
Give civil servants option to withdraw lump sum pension, says group
Yesterday, it was announced that the public service remuneration system is expected to retain its monthly pension payment model. (Bernama pic) PETALING JAYA : The government has been urged to allow civil servants under the public service remuneration system (SSPA) the option of receiving their pension either as monthly payments or a lump sum upon retirement. Persatuan Pesara Kerajaan dan Swasta (Pejasama) president Azih Muda said such flexibility was necessary as some retirees might prefer access to a large sum of money to make significant purchases after completing their service. 'If the pension is paid monthly, we can't predict how long a person will live. Therefore, the option to withdraw a lump sum should be made available, provided it is consented to by the civil servant concerned in writing,' he told FMT. Azih said the government should hold in-depth discussions with all stakeholders, noting that the views of those in leadership often differ from those in the lower grades of the civil service. 'Those holding positions in lower grades but who have worked for 30 or 40 years may want to use their retirement money to build a house or perform the haj, but they are not able to access all their funds at once,' he said. He was commenting on the proposed reforms to the SSPA, which is expected to retain the monthly pension payment model. Yesterday, public service department director-general Wan Ahmad Dahlan Abdul Aziz described the proposal as a proactive move, citing cases of pensioners falling victim to scams as a key concern, along with the need to manage retirement savings more efficiently. Wan Ahmad Dahlan also said the proposal had received backing from the finance ministry and EPF, both of which are involved in the review of the SSPA. Azih however said the government should conduct a thorough study of the proposal to avoid complications. 'A comprehensive review is needed to weigh the benefits and drawbacks,' he said. On concerns about scams, Azih said that retirees today were more informed thanks to widespread media coverage and financial literacy efforts. 'They must understand the risks and responsibilities involved, and they need to be smart about managing their finances,' he said.
