KUALA LUMPUR (July 6): Prime Minister Datuk Seri Anwar Ibrahim said the government is coming up with a mechanism “to protect the pensioners”, in response to the Federal Court’s decision last week to nullify and void amendments to the Pensions Adjustment (Amendment) 2013 Act (PAA) that the apex court deemed to be unconstitutional and less favourable to pensioners.
Asked whether the government would give 10 years’ back-pay to pensioners due to the Federal Court’s decision, the prime minister said “We will deal with it. We have to respect the decision of the Federal Court. But, we are having [a] mechanism to protect the pensioners.”
On June 27, a five-member Federal Court bench decided that the amendment to Sections 3 and 7 of the PAA, which allows for only a 2% increment annually, was less favourable to pensioners when compared with the previous scheme, in which the pension of government retirees was revised based on the prevailing salary of incumbent civil servants at that grade.
“We will announce it [mechanism] soon. We are working on the details,” the prime minister said after launching the Employees Provident Fund’s i-Akaun Mobile App and the International Social Well-being Conference 2023 on Thursday (July 6).
The court held that the provisions contravene Article 147 of the Federal Constitution, which protects pensioners’ rights.
In upholding the Court of Appeal decision, Chief Judge of Malaya Datuk Mohamad Zabidin Mohd Diah said the appellate court was right in restoring the status quo of preserving the original Sections 3 and 6 prior to the 2013 amendment.
“We find no reason to depart from the Court of Appeal judgement. Hence, the apex court finds no merit in the appeal by the government and the Public Services Department (PSD) director general, and the appeal is dismissed.
“The court makes no order as to costs, as this is public interest litigation,” said Mohamad Zabidin, who read the unanimous decision.
The case concerns Aminah Ahmad, a former Wisma Putra staff member who retired in 2002, who brought the case up in 2017, challenging the January 2013 amendment that brought about a flat rate of 2% increment to pensions annually.
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