PARLIAMENTARY PENSIONS BILL

Order for Second Reading read. 3.20 p.m.

The Minister for Law, the Environment and Science and Technology (Mr E.W. Barker): Mr Speaker, Sir, this Bill was tabled in the name of the Prime Minister. As it deals with pensions of parliamentarians, Government has decided that it would be more appropriate for me, as the Leader of the House, to move it.

I moved the Parliamentary Pensions Act in 1969. Nine years have gone by since, but it still contains some defects and anomalies, in spite of the several amendments which we made to the Act. Government has therefore decided, after careful consideration, that the time has come to enact a new Act.

This Bill was first read in this House on the 31st of January last. It has been allowed to lie on this Table all these months in order to allow hon. Members ample time and opportunity to study and consider its implications. Certain representations have been made by Members which have been carefully considered and a few accepted, as Members will see from the notice of amendments.

A great deal of time, thought and effort has been given to the drafting of this Bill. It is not possible to accommodate everyone who stands to lose what he has or would have earned under the present Act, without creating new anomalies. However, we feel that the Bill together with the amendments, which I shall be moving in Committee, will provide a fairer and a more lasting framework. It has taken account of our social and economic circumstances. It will not do too much injustice in lost expectations of higher pensions of those who will in the future have their pensions as Members of Parliament and office-holders calculated separately, and not jointly as under the present Act.

I do not propose to deal with the technical details and complexities of the Bill but merely wish to explain the reasons which prompted Government to initiate this Bill and to draw the attention of hon. Members to the most significant changes.

First, I must stress one point. Our Party occupies every seat in this House, and has done so ever since the second half of 1965. We can enact any law and move any resolution that suits us in this House. But each and every law or resolution has to be manifestly fair and publicly justified, or the censure will be registered at the next elections. Because we occupy all the seats, we have a heavy responsibility, and this responsibility becomes particularly onerous when we are taking through a bill to provide for our own pensions upon retirement. It would be tempting and easy for us to provide enhanced benefits for ourselves, but it is a temptation we must resist when discharging our duty, namely, to ensure that any revision must be in the public interest.

One of the crucial problems which we face is to ensure that there will be sufficient men of character, integrity and talent who can take over from the present leaders and ensure the continuity of honest, effective and efficient Government. It is, therefore, of paramount importance that we should make the terms and conditions of service for Members and office-holders sufficiently attractive for the ablest and best to want to enter Parliament and to take office. Mediocrity in political leadership is a luxury we cannot afford in Singapore. Hence this Bill which, it is hoped, will encourage our most promising to enter politics and to serve the nation. It will be a great tragedy if we should fail in this objective.

A serious defect of the present law is that it fails to take into consideration the difference in the contributions made by Members in their various official capacities. A Minister, for example, has far more responsibility than a Parliamentary Secretary or a Backbencher. Under the present law there is no distinction between the pension of an office-holder and that of an ordinary Member. A Member's pension at present would be computed on the basis of his reckonable service as a Member as well as an office-holder without any distinction, and on his best three years' salary. The new formula embodied in the Bill has an entirely different basis, treating service as a Member and service as an office-holder as separate and distinct. The pension benefits in respect of an office-holder will reflect the actual contribution made by him in his various official capacities.

To qualify for a Member's pension, a Member must have at least nine years' reckonable service as at present. To qualify for an office-holder's pension, an office-holder must be an office-holder for at least eight years. However, if an office-holder has less than eight years' reckonable service there is provision to convert the period of his service in any office or offices to count as additional period to determine his eligibility for and the amount of his Member's pension.

Further, the pension rate at present payable to all of us is fixed at 1/30th of our annual salary. Under the Act, the pension rate payable to a Member will remain the same, that is to say, at 1/30th, but the pension rate payable to an office-holder will be raised to 1/27th of his annual salary.

Another defect of the present law is that the qualifying age for a pension is too low as it is fixed at 45 years. The normal retirement age for civil servants is 55 or 60 years depending on whether the officer is recruited before or after 1st July 1956. At 45 years of age a man should be at the prime of his life and should not be thinking of his pension. It is, therefore, proposed to fix the qualifying age for all Members of Parliament, be he a Member or an office-holder, at 50 years of age under the new scheme.

Yet another defect of the present Act is contained in section 10 which provides for service in a public office (defined in that section as the office of High Commissioner or Ambassador or such other office as the President may determine) to count as reckonable service for the purposes of Parliamentary pension and for the pension to be computed on the basis of the salary drawn in the public office. This present provision is difficult to justify. Service as an Ambassador cannot in any circumstances be equated with service as an office-holder. The section has therefore been removed and will find no place in the new pension scheme embodied in the Bill.

Though the present Act is being repealed, the rights of former Members of Parliament who are already in receipt of a pension will be preserved. So will the rights of former Members of Parliament who may become eligible for the grant of a pension on attaining the age of 45 years.

There are some serving Members of Parliament who have already become eligible for the grant of a pension under the present Act, in that they have served for more than nine years and have reached the age of 45. If they retire or cease to be Members before the date of enactment of the new Act, they would be entitled to a pension. It is therefore considered fair that their rights should be preserved. I will be moving an amendment to Clause 15 to provide for this.

There are other Members in this House who have reached the age of 45 years, but have not served for at least nine years. There are others also who have served for nine years or more but have not reached the age of 45. These Members will not be given, I repeat, will not be given, the option to remain under the present Act, even though the present Act is more generous to them. It is considered right and proper that they should come under the new Act, since the benefits they enjoy under the present Act were fortuitous and unintended.

Sir, I have spoken freely and frankly within the constraints that circumscribe me as a Minister of the Cabinet. I hope hon. Members will speak even more frankly and freely than I have.

Sir, I beg to move.

Question proposed. 3.30 p.m.

Dr Augustine Tan: Mr Speaker, Sir, I find this Bill a difficult subject to speak on. Nevertheless, it is important that the issues raised by the Bill be thoroughly aired so that our constituents do not misconstrue our intentions. Members of Parliament have given long and careful consideration to the Bill. Representations were made, resulting in a number of amendments which remove some inequities.

Allow me, Sir, to comment on some of the provisions of the Bill.

The change in pensionable age from 45 to 50 years affects the younger Members adversely. I hope this will not deter young people from aspiring to be Members of Parliament. The majority of present Members accepted office when no pension was available and when the parliamentary allowance was much less than it is today. In the same spirit, I am sure we will accept the adverse change in pensionable age.

The change in the basis of computation for office-holders' pensions from 1/30th to 1/27th makes little or no difference to the majority of existing office- holders. The Senior Ministers who started in 1959 have already served 19 years. Under the old formula of 1/30th salary for each year of reckonable service, they have almost reached the maximum two-thirds allowable. The change to 1/27th clearly does not benefit them.

Those Ministers who started in 1963 have served 15 years. The change in the basis of computation means very little, from 1/2 to 5/9ths of their salary.

For those office-holders who were promoted from lower offices, the new Bill has reduced their pension benefits significantly. I refer to Senior Ministers of State, Ministers of State and Senior Parliamentary Secretaries who rose from lower offices. Under the existing Act, these colleagues would enjoy pension based on the highest three years' salaries. The new Bill prorates their benefits in accordance with years of service in each office, I hope this will not deter younger Members from accepting junior offices at considerable sacrifice to their own careers and having to run the gauntlet to reach higher office.

On this side of the Bench, there are three colleagues who deserve mention because the new Bill has affected them particularly adversely. Two non-office holding Members are currently serving as Ambassadors abroad. I refer to the Members for Ulu Pandan and Katong. Under the existing Act, their service as Ambassadors is reckonable for pension as mentioned by the Hon. Minister. The new Bill has removed this provision. But I do not think that these colleagues would have changed their minds about serving our country had they been informed of the change beforehand.

The other colleague who is losing out substantially is the Member for Farrer Park. He has served as Parliamentary Secretary, Minister of State and as Cabinet Minister. He has more than nine years of reckonable service but his problem is that he is too young - not yet 45. Therefore, he will lose out considerably under the new Bill.

Sir, I am drawing attention to these adverse effects of the Bill so that it is clear to the public that we are acting responsibly in a matter affecting our immediate welfare. Singapore would be ill -served if its leaders do not have the proper dedication and the willingness to sacrifice time, energy and even material benefits for the nation.

Public service in Singapore is certainly no bed of roses. Strict standards of honesty and integrity ensure that the public knows exactly what it is paying to Members of Parliament and office-holders. Perquisites of office are so paltry as to be almost non-existent. The ordinary MP gets only a home telephone - there is no provision for staff, not even a direct telephone line in his own office. He gets a part-time allowance for a job that is supposed to be part-time but which carries full-time responsibility. He has to nurse his own career at the same time. But the demands of office include not only Parliament and Parliamentary Committees but also his Constituency, his Party Branch and the Party itself which can sometimes be demanding. The resulting time and energy expended cut significantly into his own career. Perhaps some thought should be given to supporting services for MPs to allow them to be more effective. Meet-the-people sessions, for example, are easy to handle when only 10 to 20 people turn up but not when 80 to 100 turn up. I am sure constituents would appreciate easier access to MPs. This can be done if MPs are allowed full-time staff - at least a good personal assistant - located in the constituency and who are qualified enough so as to be able to handle complaints and problems.

Mr Speaker, Sir, it is a good thing to provide for our pensions but we want to be in a position to enjoy it. May I offer my support to the Bill.

Mr Hwang Soo Jin: Mr Speaker, Sir, I had not intended to speak on this Bill, but, having listened very carefully to the Minister concerned and the Member for Whampoa, I do agree that if we do not speak up, members of the public will think that we are trying to sneak through this House extra perks for MPs. As the Minister puts it, we are trying to rationalise and make the pension scheme more attractive so as to be able to attract the best brains. I am afraid this is rather misleading, as very eloquently put forward by the Member for Whampoa. If anything, I find that the Bill is rather more restrictive than what it used to be. The pensionable age used to be 45 but now it is 50 years. As pointed out here again by the Member for Whampoa, quite a few Members, in fact, would suffer very badly. I also share his sympathy for the Member for Katong who is away in the cold of Moscow. [Interruption]. I do not know about Bonn but I think it is quite a pleasant place.

Nevertheless, I think it would be wrong to say that the "service of Ambassadors cannot be equated with service as an office-holder." These are the words of the Minister. I certainly hope that he will think over that clause again. I think it is unfair to our friend who has uprooted the family by going abroad and there are all the attendant difficulties and problems associated with having to move house and finding appropriate education for the children and so on. This is one aspect which has been very eloquently pointed out by the Member for Whampoa.

All that I am concerned is this. I still remember that after the First Reading of this Bill in this House, the next day the press seemed to give the impression that a whole series of new perks were being introduced. I am afraid this is not very responsible press reporting and I certainly hope that after today's session, we will see something more accurate tomorrow so that members of the public would not think that we are trying to do ourselves great favours here.

Mr Barker: Mr Speaker, Sir, may I first thank the two Members who have just spoken for their valuable contributions and for taking this Bill in the right spirit. As for Ambassadors, the Member for Jalan Kayu asked that we think over this clause again. What can best be done is to provide for gratuities for Ambassadors through and by way of the Foreign Service. But to equate them with MPs will mean going back to square one.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr E.W. Barker].

Bill considered in Committee.

[Mr Speaker in the Chair]

3.40 p.m.

Clause 1 ordered to stand part of the Bill.

Clause 2 -

Mr Barker: Sir, I beg to move,

In page 2, after line 6, to insert -

"(2) The reference to service in Parliament in the definition of "reckonable service" in subsection (1) shall be read as Including a reference to service in the Legislative Assembly on and after the 3rd day of June, 1959, and before the 9th day of August, 1965.".

Sir, this is a purely technical amendment to make clear that the reference to service in Parliament in the definition of "reckonable service" will be read as including a reference to service in the Legislative Assembly on and after the 3rd day of June, 1959, and before the 9th August, 1965, during which period Parliament was known as the Legislative Assembly.

Amendment agreed to.

Mr Barker: Sir, I beg to move,

In page 2, to leave out lines 19 to 27 inclusive.

This is considered now not necessary.

Amendment agreed to.

The Chairman: Consequential amendments will have to be made to renumber sub-clauses (2) and (3) as sub-clauses (3) and (4) respectively. This will be done.

Clause 2 as amended, ordered to stand part of the Bill.

Clause 3 ordered to stand part of the Bill.

Clause 4 -

The Chairman: There is a correction to be made in page 3, line 26. The word "provisions" has been wrongly printed.

Mr Barker: Sir, I beg to move.

In page 4, after line 23, to insert -

"Provided that where the monthly rate of salary applicable to any office previously held by an office-holding Member is increased during any continuous period of reckonable service while he is an office-holding Member but holding another office, he shall be deemed to have received such increased rate during his period of reckonable service as a holder of that office."

Sir, this amendment is necessary so as to ensure that an office-holding Member who is appointed to another office, whether by reason of promotion or otherwise, will not suffer any detriment in the amount of pension which may be granted to him as a result of the change in his office. The amendment will give him the benefit of any increase in the monthly rate of salary applicable to any previous office held by him, if the increase is made whilst he is in continuous service as an office-holder but is at the time of the increase holding another office. 3.45 p.m.

This will remove the possibility of a situation in which an office-holder who is appointed to another office will receive less pension than if he had not been so appointed because of a general upward revision of salaries after such appointment. If he has a very long period of service in his previous office or offices and only a short period in his current office before ceasing to be an office-holder, the pension in respect of his reckonable service in his previous office or offices will, without the amendment, be calculated on the pre-revised salary instead of the revised salary. The amendment will enable the revised salary to be used in computing his pension for the periods of reckonable service in previous offices which are continuous with his reckonable service in his current office.

Amendment agreed to.

The Chairman: Consequent upon the addition of the new proviso, the full-stop at the end of line 23, in page 4, will have to be substituted with a colon. This will be done.

Clause 4, as amended, ordered to stand part of the Bill.

Clauses 5 to 14 inclusive ordered to stand part of the Bill.

Clause 15 -

Mr Barker: Sir, I beg to move,

In page 9, after line 3, to add -

"(4) If in the case of a Member who at the commencement of this Act has not less than nine years' reckonable service and has attained the age of forty-five years, the pension which he is eligible to receive under section 3 on his ceasing to be a Member, together with any pension which he is eligible to receive under section 4, is less than the amount of pension which he would have been eligible to receive under the former Act in respect of his reckonable service before the commencement of this Act had he ceased to be a Member at the commencement of this Act, his pension under section 3 may be increased by the difference between that amount and the pensions which he is eligible to receive under sections 3 and 4:

Provided that this subsection shall not apply to a person who may be granted a pension by virtue of sections 8 and 10.

(5) Any person who at the commencement of this Act is eligible to receive a pension under section 10 of the former Act in respect of his reckonable service under that Act if he had ceased to hold public office as defined by that section may, when he ceases to hold such public office, be granted a pension under the former Act in respect of the period of such reckonable service before the commencement of this Act as if the former Act had not been repealed by this Act.".

First, may I deal with the insertion of subsection (4). This amendment will ensure that a Member who is already eligible will receive a pension under the present scheme, that is to say, he has done nine years' reckonable service and has attained 45 years of age. Now, if he were to cease as a Member on the commencement of the new scheme, he will ultimately receive under the new scheme not less than the amount which he would have been eligible to receive under the present scheme in respect of the period of his service before the commencement of the new scheme. If, in the case of such a person, his Member's pension together with any pension which he may receive as an office-holder under the new scheme is less than that amount, his Member's pension may be increased by a sum equal to the difference.

The proviso to the subsection makes clear that this special preservation of benefit will have no application in the case where a pension is granted in the circumstances referred to in the two New Clauses (A) and (B) which will be inserted as clauses 8 and 10 respectively later.

Sir, as for the new subsection (5), this amendment will preserve the benefit of any person who is already eligible to receive a pension under section 10 of the existing Act, if he were to cease to hold public office as defined by that section, but only in respect of his reckonable service up to the date of commencement of the new scheme. No further benefit under section 10 of the existing Act will be available for any subsequent service in the public office defined by that section. Under the new scheme there will be no provision corresponding to the said section 10, as that section is considered to be an anomaly.

Amendment agreed to.

Clause 15, as amended, ordered to stand part of the Bill.

New Clause (A) - "Pension (1) Where after the commencement of granted this Act a person ceases at any time to be to person a Member or to hold office by reason of ceasing ill-health and the President is satisfied to be that on account of such ill-health that Member or person has become incapable of office- performing the duties of a Member or of holder on his office, he may be granted a pension or medical gratuity in accordance with this section, ground. (2) In the case of a person who ceases to be a Member and - (a) who has the minimum period of reckonable service to be eligible for a pension under section 3, he may be granted a pension in accordance with that section notwithstanding the fact that he has not attained the age of fifty years; (b) who does not have the minimum period of reckonable service to be eligible for a pension under section 3, he may be granted a gratuity to be computed - (i) at the rate of ten per cent of his annual salary as defined in subsection (4) of section 3 for each completed year of reckonable service as a Member (including any period of reckonable service which may be counted by virtue of section 5); and (ii) at the rate of ten per cent of one-twelfth of such annual salary for any completed month remaining after the last completed year of reckonable service. (3) In the case of a person who ceases to hold office and who has the minimum period of reckonable service to be eligible for a pension under section 4, he may be granted a pension in accordance with that section notwithstanding the fact that he has not attained the age of fifty years.". - [Mr E W Barker].

Brought up, and read the First time.

Mr Barker: Sir, I beg to move, "That the clause be read a Second time."

Mr Speaker, Sir, this provision is designed to secure for a Member who has to cease to be a Member by reason of ill-health, a Member's pension if he has the minimum nine years' reckonable service, notwithstanding the fact that he has not attained the pensionable age of 50 years. The President must, however, be satisfied that on account of such ill-health he has become incapable of performing the duties of a Member. If such a person does not have the minimum nine years' reckonable service, he may nevertheless be granted a gratuity at the rate of 10% of his annual salary for each completed year of reckonable service as a Member.

This provision will also secure for an office-holder who satisfies the President that he has to cease holding office on account of ill-health, a pension for service as an office-holder if he has the minimum eight years' reckonable service for such pension even though he may not have attained the age of 50 years.

Question put and agreed to.

Clause read a Second time and added to the Bill.

The Chairman: This new clause is to be inserted immediately after clause 7. This will be done.

New Clause (B) - "Pension and (1) This section shall apply in relation gratuity to any person - granted on in- (a) who has ceased to be a Member; capacity (b) who would, had he attained the or death age of fifty years, be eligible for of ex- the grant of a pension under Member. section 3 or 4; and (c) who has not been granted any pension or gratuity under this Act. (2) If any person to whom this section applies dies before attaining the age of fifty years there may be paid to such of his dependants as the President may think fit or, if there are no dependants, to his legal personal representatives a gratuity of an amount equal either to his annual salary as defined in subsection (4) of section 3 or the commuted pension gratuity which might have been granted to him under section 6 if he had attained the age of fifty years in respect of both his reckonable service as a Member and as a holder of any office, whichever is the greater. (3) If the President is satisfied that any person to whom this section applies is physically or mentally incapacitated so as to be unable to continue in any employment before he has attained the age of fifty years, he may be granted a pension under section 3 or 4 with effect from the date he satisfies the President that he is so physically or mentally incapacitated, notwithstanding the fact that he has not attained the age of fifty years.". - [Mr E.W. Barker].

Brought up, and read the First time

Mr Barker: Sir, I beg to move, "That the clause be read a Second time".

Sir, this provision deals with certain contingent circumstances in the case of a person who has ceased to be a Member and has the minimum period of reckonable service for a Member's or office-holder's pension but has not been granted any such pension because he has not yet attained the age of 50 years. If he dies before attaining the age of 50 years, his dependants or legal personal representatives may be paid a gratuity. If he becomes physically or mentally incapacitated so as to be unable to continue in any employment before he has attained the age of 50 years, he may be granted a pension notwithstanding the fact that he has not attained the age of 50 years.

Question put and agreed to.

Clause read a Second time and added to the Bill.

The Chairman: This new clause is to be inserted immediately after clause 8. This will be done.

Amendments will also be made to renumber clauses 8, 9, 10, 11, 12, 13, 14 and 15 as clauses 9, 11, 12, 13, 14, 15, 16 and 17 respectively, consequent on the addition of the new clauses, and to amend the contents page consequent on the addition of the new clauses.

Bill reported with amendments; read a Third time and passed.