I refer to the proposal to convert the civil service pension scheme to a contract scheme. I presume the conversion will involve changing the pension payment to the EPF scheme, just like those in the private sector.
However, the EPF scheme would probably provide more flexibility since it allows employees to leave the service without losing their “pension benefits”.Civil servants on the pension scheme do not receive monthly EPF contributions from the government as in the case of those in the private sector. But this does mean the government is free from obligation to provide for civil servants’ retirement.
The problem with most governments, Malaysia included, is “unfunded pension liability”. They put their employees on the pension scheme, but they have not provided periodic allocations to cater to their employees’ eventual retirement. The money in KWAP should be jealously guarded against pilferage and abuse. But we know by now the “history” of KWAP and how the money was conveniently siphoned off to finance fiscal deficits and to finance dubious and devious projects.