KUALA LUMPUR (Feb 10): The Public Services Department (PSD) and federal government have applied for a stay in the High Court’s decision last month that allowed a pension increase for retirees, based on their final salaries according to the PSD’s 2016 circular, effective January 2022.
The application for a stay was received by former Wisma Putra staff Aminah Ahmad’s solicitors Messrs Shukor Baljit & Partners on Monday.
Datuk Baljit Singh Sidhu, when contacted by The Edge, confirmed receiving the notice for a stay of the High Court’s orders, along with an affidavit signed by PSD director general Tan Sri Wan Ahmad Dahlan Abdul Aziz.
“Their main argument for [a] stay was the financial implications to the government of an estimated RM1.7 billion [having to be paid],” Baljit said.
The PSD DG expressed concern that if the government were to pay out the arrears, it would be challenging to recover the amount, given that the court's decision to allow the appeal would likely render the government and PSD's payments invalid.
Besides the stay, the government had previously filed a notice of appeal on January 23 over High Court judge Datuk Amarjeet Singh Serjit Singh's decision, which allowed Aminah and other pensioners to receive the increase in pension based on their final salaries, as per the 2016 PSD circular. The court ordered the PSD and government to pay the arrears within three months of January 16.
Arrears to be paid within three months
Amarjeet, in his decision directed at the PSD and the government through a mandamus order (to compel them), said that 2016 circular has the effect of a salary revision for all civil servants, and hence the pensioners are entitled to the increment.
“In light of the Federal Court’s decision (that dismisses the government and PSD’s appeal), the arrears are to be paid effective January 2022 (the date of the Court of Appeal’s decision that allowed pensioner Aminah Ahmad’s appeal). The court makes no order as to costs,” the judge said in reading his decision.
Despite this being an action by Aminah on behalf of 57 other retirees, this will affect an estimated 531,976 former civil servants.
In January 2022, a three-member Court of Appeal (COA) bench, in allowing Aminah’s appeal, ruled that the Pension Adjustment Act 2013 (PAA 2013) was null and void, when it declared Sections 3 and 6 of the amendment as being unconstitutional.
Aminah, a former Wisma Putra staff who retired in 2002, brought the action in 2017, naming the government and the PSD DG as respondents.
She claimed that the PAA 2013 amendment, which had brought about a flat rate of 2% increment, was unconstitutional when compared to PAA 1980, which was more favourable, since the pension of government retirees was revised based on the prevailing salary of incumbent civil servants at that grade.
The COA’s unanimous decision in January 2022, written by then-judge Datuk Darryl Goon Siew Chye, agreed that the PAA 2013 amendment may result in a less favourable position, and hence contravenes Article 147 of the Federal Constitution.
Article 147, regarding the protection of pension rights, stipulates: The law applicable to any pension, gratuity or other like allowance (in this constitution referred to as an “award”) granted to a member of any of the public services, or to his widow, children, dependants, or personal representatives, shall be that in force on the relevant day or any later law not less favourable to the person to whom the award is made.
Goon — who had sat with Datuk Vazeer Alam Mydin Meera and Datuk Abu Bakar Jais (both now Federal Court judges) — in finding the 2% increment imposed in the PAA 2013 to be unreasonable, said Section 3(2) prescribes that the Yang di-Pertuan Agong may prescribe different percentages of increment for different categories of recipients to remedy the situation.
However, in allowing Aminah’s appeal, the COA ordered that the revision be based prospectively effective from its January 2022 decision, and not retrospectively from the PAA 2013 that had been declared null and void.
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