PUTRAJAYA (April 7): The Federal Court on Monday overturned the decision in a pension dispute involving retired senators, ruling that they are not entitled to an increment in their pension when the salaries of serving Members of Parliament are raised.

A three-judge panel led by Chief Judge of Malaya Datuk Seri Hasnah Mohammed Hashim allowed the appeals by the government of Malaysia, the Public Service Department (PSD) director general, and the chief administrator of Parliament.

This decision reversed the Court of Appeal’s decision that had granted the claim of Datuk Idris Buang and Datuk Seri Kamarudin Ambok, both retired senators, for their pensions to be recomputed and revised in accordance with the increased salaries of serving MPs, following the enforcement of the Members of Parliament (Remuneration) (Amendment) Act 2015.

In delivering the broad grounds of judgement, Hasnah said retired senators are not entitled to receive pension adjustments based on the salary increase for serving MPs.

She said the right to receive such an adjustment had not yet been accrued at the time the Members of Parliament (Remuneration) (Amendment of First Schedule) Order 2015 was enacted on Feb 16, 2015.

Hasnah added that adjustment of pensions based on the salary increase for current parliamentarians is a contingent right, not an accrued or acquired right, and it is not covered by the provisions of the Interpretation Acts 1948 and 1967.

Sitting with her on the panel were Datuk Zabariah Mohd Yusof and Datuk Abdul Karim Abdul Jalil.

Hasnah said the protection of pension rights under Article 147 of the Federal Constitution applies only to members of the public service, not to the respondents, as they are not members of the public services as defined under Article 132 (1) of the Federal Constitution.

“Therefore, there will be no issue with the amendment to Paragraph 20 of the First Schedule to the Members of Parliament (Remuneration) Act 1980, which resulted in a less favourable situation to the respondents as allegedly guaranteed by Article 147 (1) of the Federal Constitution,” she said.

Before Jan 1, 2014, Paragraph 20 of the First Schedule to the Members of Parliament (Remuneration) Act 1980 specified that senators and MPs were eligible for pension adjustments whenever there was a salary revision. However, after the amendment, MPs' pensions would increase by 2% annually, without a salary revision taking place.

The legal battle began when Idris and Kamarudin, along with other retired senators, filed an originating summons in the Kuala Lumpur High Court in 2019, seeking a declaration that they have the right to have their pensions recomputed and revised in accordance with the increased salaries of MPs, pursuant to the Members of Parliament (Remuneration)(Amendment) Act 2015.

According to the duo, this amendment to the Act took effect on Jan 1, 2015.

They wanted a declaration that they are entitled to receive recomputed and revised pensions based on the substantial (about 167.45%) increased salary of current serving members of the Senate/Parliament, which has been raised from the original salary of about RM4,112.79 a month to RM11,000 a month.

The senators retired before the amendment Act came into effect. 

The High Court dismissed their suit on Jan 16, 2020. However, on Jan 30 last year, the Court of Appeal reversed the decision.

At the Federal Court proceedings on Monday, senior federal counsels Rahazlan Affandi Abdul Rahim, Nurul Husni Ab Rahman, Syahirah Mohamad Ashahari, Mohamad Tarmizi Ahmad, Liew Horng Bin and Jackie Mary Fernandis represented the government, the PSD director general and the chief administrator of Parliament, while lawyers Krishna Dallumah, Indran Kumaraguru, Yong Yoong Hui, Chong Jen Hui and Nasuha Badrul Din acted for the retired senators.

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