LETTERS: The civil service pension system has often been criticised for its rigidity in evolving economic landscapes.
By embracing Employees Provident Fund contributions for new civil servants, the government is demonstrating its commitment to modernising the civil service and aligning it with contemporary financial practices.
This reflects a forward-thinking approach aimed at ensuring the sustainability and long-term viability of the civil service retirement framework.
Under the old system, the government funded retirees' pensions, placing a significant financial burden on public funds.
With the transition to EPF, I believe the financial burden will be distributed more equitably between civil servants and the government, fostering a more sustainable and balanced retirement funding model.
Furthermore, the EPF contributions model provides greater autonomy and control over one's retirement savings.
This enhanced flexibility enables employees to make informed decisions regarding their financial future. EPF allows for 17 types of withdrawals.
It's crucial to note that the government's liability for pension payments will reach RM120 billion in 2040 if the existing pensions policy continues.
By shifting away from the conventional pension scheme, the government can redirect financial resources towards priority areas, such as infrastructure development, healthcare, and education.
This reallocation of funds promotes fiscal sustainability and facilitates strategic investments aimed at driving economic growth and enhancing the wellbeing of citizens.
The transition away from the traditional pension scheme represents a positive step towards modernising Malaysia's civil service and ensuring its long-term financial sustainability.
NUR FARAH IDAYU SAADON
Training Consultant
National Institute of Public Administration
Kuala Lumpur
The views expressed in this article are the author's own and do not necessarily reflect those of the New Straits Times