NON-PENSIONABLE ANNUAL ALLOWANCE (Payment to retiring officers)

Mr Ch'ng Jit Koon asked the Minister for Finance (a) how many Civil Servants retired on reaching the age limit in each of the years 1973 to 1976; and (b) how many of them did not receive the non-pensionable annual allowance, either in whole or in part, in the year of their retirement.

The Minister for Finance (Mr Hon Sui Sen): Sir; the numbers of civil servants who retired on reaching the age limit are:- 1973 - 505 1974 - 340 1975 - 217 1976 - 326

The non-pensionable annual allowance is payable only to officers who are in service as on 31st December and therefore those who leave the service in the course of the year, on account of resignation or retirement, are not eligible for the allowance.

Mr Sia Khoon Seong (Moulmein): Sir, I wish to ask the Minister if he will consider removing the existing stipulation not to extend the payment of the 13th month annual wage supplement to civil servants who retire before the 31st of December or to their dependants if they die during service, even if the quantum of payment is proportionate to the number of months they have served.

Mr Hon Sui Sen: Sir, I am not quite sure I understand the gist of the Member's question. The present position is that all serving officers on the 31st December get the allowance, and all officers who are not serving on the 31st December do not get the allowance. Under the present system there is no question of any one being entitled to any proportionate payment.

Mr Sia Khoon Seong: Sir, I am aware of that provision. That is why I am asking the Minister whether he will consider removing that stipulation. I am aware that there is a stipulation at present barring these people from enjoying the benefit. My question is, will he consider removing this stipulation?

Mr Hon Sui Sen: The answer is no. The allowance is not a bonus. I think I must stress this. It is not payable like, say, bonuses, in companies where maybe a proportionate amount can be paid, because it is for services rendered during the year. The intention of the non-pensionable - annual allowance is to reward officers who are still with us on 31st December and who will continue in service with us for the rest of the year, and to give their loyal service to the Government.

Encik Mansor Haji Sukaimi (Kampong Kembangan): Sir, what about those officers who retire on the 30th December, subjected to one day's break in service on the 31st December, and re-engaged on the 2nd January?

Mr Hon Sui Sen: The answer is simply no. It does not fall within the definition. But the terms of re-employment are such that they can be renegotiated to include whatever may be necessary - a higher salary or a lower salary; or a salary to include consideration for whatever he may have lost.

Mr Sia Khoon Seong: Sir, does the Minister not agree that the 13th month annual wage supplement is a form of deferred monthly wages, as he has stated in Parliament when this was announced? If so, should not the civil servant who retires or dies while in service be entitled to at least part payment of the 13th month annual wage supplement?

I would like to also ask the Minister if it is not true that civil servants who have just joined the civil service are entitled to a proportionate amount of the 13th month payment in the first year. If so, is it not only fair and equitable that the same entitlement be extended to retiring civil servants in their last year of service, or to their dependants should they die while in service?

Mr Hon Sui Sen: The answer is no. It may be that there should be a pensionable allowance based in the manner in which the Member suggests, but we did not frame it in that manner, and therefore there is no entitlement. I do not think we would be prepared to change the nature of this concept of annual non-pensionable allowance to the nature suggested by the Member concerned. In fact, the first idea was that this would be in the form of a wage increase except that, instead of giving it in 12 instalments for the year, we suggested that it may be desirable to give it in one lump sum payment, and therefore the first annual allowance was given to officers serving on the 31st March. Members may note that it was not intended that it should be for service for the calendar year. The first payment was made on 31st March and subsequently we thought that perhaps the end of the year would be a more desirable time to pay because that is the time where there are festivals - the Christmas and the Chinese New Year.

Mr Sia Khoon Seong: The Minister has, in fact, confirmed what I said, but my question has not been answered. As he has agreed with me that this 13th month payment is actually a form of deferred monthly wages -

Mr Hon Sui Sen: I did not say that.

Mr Sia Khoon Seong: Well, he said that it should be a wage increase and that it should be paid at the end of the year instead of monthly. That is a deferred monthly wage increase to be paid at the end of the year. My question earlier was, if this was so, then if someone has served seven months in the year, he should be entitled to seven months of that wage increase. That is my question. Sir, unless the Minister said otherwise.

Mr Speaker: I am not sure whether you are asking questions or making a speech. Mr Sia.

Mr Hwang Soo Jin: Sir, my question is simply this. If a person has worked for 20 years and, just short of a few days before he qualifies for it, he should kick the bucket, should we not be more humane and sympathetic and pay pro rata to his dependants?

Mr Hon Sui Sen: Sir, that is another question. If he suggests that some gratuity, pension, or other allowance should be given, let us consider it on that basis, and not make the non-pensionable allowance which is not intended to be a gratuity, a pension or an exgratia payment to him under those terms.

Mr Ng Kah Ting (Punggol): In the light of the Minister's reply, would he consider favourably the question of the Member for Jalan Kayu by enlightening this House further on this aspect?

Mr Hon Sui Sen: Sir, I am not in a position now to discuss a revision of the whole Pension Ordinance or the CPF or the gratuity or ex-gratia payment. In this instance, I am saying that the non-pensionable allowance is not a pension. In fact, it is called a non-pensionable allowance. It is an allowance and the terms of this allowance are stated exactly in the circular which was issued. The first payment was in respect of the year-end 31st March, 1972.