Human greed seems to know no
limits, and it debunks LKY's philosophy that pay well to prevent
corruption, as the following article seems to show that paying too
well will create an insatiable appetite for more.
Ministers get pensions too
The Parliamentary Debate recorded a
lively exchange between Steve Chia and then DPM cum Finance
Minister LHL concerning Minister's Pension.
It is shocking that Ministers (appointed before 1995) are paid a
pension when they reach 55 years and continue to stay in
Office.
From Yawning Bread, April
2007
Ministers get
pensions too
The Parliamentary Pensions Act is
worth a read. Despite its name, it doesn't now appear to provide
pensions for any members of parliament after 1995. However, it does
provide pensions "in respect of service as Prime Minister, Deputy
Prime Minister, Speaker, Ministers and other office-holders." The
computational formula is quite complex, based on the number of
years of service, up to a maximum of "two-thirds of the highest
annual salary of any office held by him."
On 15 June 2004, Steve Chia, then a Non-Constituency Member of
Parliament, raised this question in the chamber.
8. Mr Steve Chia Kiah Hong asked the Deputy Prime Minister and
Minister for Finance what is the justification for keeping
ministers on the pension scheme when all other public and civil
servants have been converted to the Central Provident Fund
scheme.
The Deputy Prime Minister and Minister for Finance (Mr Lee Hsien
Loong): Mr Speaker, Sir, when the civil service phased out pensions
for most of the public sector in 1986, it consciously decided to
retain the pension scheme for officers in a small number of key
services, one of which is the Administrative Service.
Administrative Officers need deep knowledge and long experience of
policy issues. The service takes in some recruits mid-career, but
it continues to rely heavily on officers who have joined at the
entry level. For these reasons, the pension scheme remains relevant
to them.
As part of their overall package, pensionable officers receive
lower CPF contributions than non-pensionable officers.
Political appointees are also on pensions because their terms of
service follow those of Administrative Officers.
( Having a pension scheme for senior
civil servants, as an incentive to permanence, may be
understandable, but the same reasoning does not extend to political
appointments. The expectation should be that political
office-holders come and go, from alternating political parties. It
is precisely because of the changeability of political
office-holders in a democracy that there is a need for a stable,
permanent civil service that can retain experience and
institutional memory. That is why the senior-most civil servant in
a ministry is titled "Permanent Secretary". He is supposed to be
permanent when the minister is expected not to be. That being the
case, why should political appointees enjoy the permanence-inducing
pension scheme? )
Mr Steve Chia Kiah Hong: Sir, how
does the Deputy Prime Minister expect citizens to take the
uncertainty of retirement planning under the CPF, which is a
defined contribution scheme, at their own cost, whereas ministers
and public officers themselves are under a guaranteed and defined
benefit pension scheme, using taxpayers' money? In other words,
their CPF may run out before the citizens die whereas qualified
ministers are taken care of by the taxpayers' money until they die.
Am I right to say this?
Mr Lee Hsien Loong: Mr Speaker, Sir, it is an entire package. When
we calculate the salary, we look into how much a person receives
now, how much he receives in the CPF, and how much he can expect to
save in pensions. And when a person retires, he has a choice of
having a pension stream for the rest of his life or taking a
commuted lump sum at the point of retirement. In fact, as a matter
of fact, nearly everybody who retires prefers the commuted lump
sum. Because you take the lump sum, you invest it, you do what you
want. If it runs out, it runs out. There is no free lunch. If you
do not have CPF, you have the pension. If you have the pension, you
have less CPF. So it all adds up to a finite amount.
The Member's implicit question is are the ministers enriching
themselves again? And the answer is, we are going on market terms
and, if anything, we are paying below what the market
is.
(Lee doesn't actually answer Chia's
question )
Mr Steve Chia Kiah Hong: Clarification from the Minister. Does any
serving minister who turns 55 actually receive both salary and
pension at the same time? If yes, should he be serving?
Mr Lee Hsien Loong: I believe the answer is yes. That is the rule
for the civil service, and the ministers follow the civil service
rules.
(Source: Parliamentary Debates, 2004)
[This may be the "rule", but is it
morally right?"
Steve Chia was referring to Section
5 of the Parliamentary Pensions Act, which says,
5. (1) Where an office-holding Member has
(a) not less than 8 years reckonable service as an office-holding
Member (whether continuously or not);
(b) attained the age of 55
years; and
(c) not previously been granted a pension under section
4,
he may be granted a pension under that
section notwithstanding the fact that he has not ceased to hold
office.
As at 31 March 2007, the following office holders, of cabinet level
or equivalent, were 55 years or older:
Name Office Year of birth
Lee Kuan Yew Minister Mentor 1923
S Jayakumar Deputy Prime Minister 1939
Goh Chok Tong Senior Minister 1941
Abdullah Tarmugi Speaker of Parliament 1944
Wong Kan Seng Deputy Prime Minister 1946
Lee Boon Yang Minister for Information, Communication and the Arts
1947
Mah Bow Tan Minister for National Development 1948
Lee Hsien Loong Prime Minister Feb 1952
(Source: Parliament website)
By the end of 2007, Khaw Boon Wan, the Minister for Health will
also have turned 55.
Two cabinet ministers did not state their dates of birth on their
government website CVs. They are Tharman Shanmugaratnam, the
Education Minister and Lim Boon Heng, the Minister without
Portfolio in the Prime Minister's Office. The latter's CV, however,
mentioned that he obtained his bachelor's degree in 1970. This
suggests that he was born before 1950, which would make him above
55 years old at this time.
