The
Prime Minister's Office has dispelled rumours of seven-figured pension payouts paid to retired ministers annually.
In a
letter to the mainstream media on Friday, the PMO said that retired ministers who serve 18 years or more receive a maximum annual pension payout of about one-tenth of their annual salary.
According to the Public Service Division figures for 2009, an entry-grade minister received an annual salary of $1.57 million while a Prime Minister's salary was $3.04 million.
On Friday, Deputy Prime Minister Teo Chee Hean told
The Straits Times the PMO saw the need to clarify the situation because of "misinformation" that has been circulating on the Internet after the General Election.
Rumours being spread online said Foreign Minister George Yeo would continue to receive a seven-digit pension sum every year, even after
stepping down as a Minister.
DPM Teo said, "I'm not surprised that it (the misinformation) causes some consternation. So it's best to just state what the actual position is and the actual position is quite different from the misinformation that has been going around."
To qualify for a pension, ministers have to serve at least eight years as a political office-holder and be at least 50 when they step down.
Their pension is determined based on the pensionable component of the monthly salary, which has been frozen since 1994, the PMO said in the letter signed by Tan Kee Yong, secretary to the Prime Minister.
A minister qualifies for the maximum pension of two-thirds of this pensionable component of his monthly salary after having served as an office-holder for 18 years. The pension is less if he has served for a shorter period.
The letter said Members of Parliament elected after January 1995 are not eligible for MP pensions, but ministers appointed after 1995 are eligible for ministerial pensions.
Civil servants from the elite Administrative Service and intelligence service officers also receive pensions after a certain number of years in service.
Explained DPM Teo, "There's a very specific reason for a small group of officers to still be on pensions because there is a premium in this case for long-term service in order to provide consistency of policy and implementation.
"But in any case, the value of the pension is fully taken into account as part of a minister's total pay package when we make comparisons with the private sector benchmarks."
The PMO also revealed that the Parliamentary Pensions Act, amended in 1982, for an eligible office-holder to receive a pension at 55 while he holds office is being reviewed.
DPM Teo said, "We are looking at that again because employment and re-employment terms have been changing over the years."
"The retirement and re-employment situation has been under review for quite some time and there have been some changes in the practice, so we want to make sure that this is appropriate still."
Originally Posted by ysyap
Here is a sitiuation where its the old guards who r quitting like GY, MM and SM. They are all under the pension scheme. Its natural that they therefore qualify for it. This applies to civil servants too. Most of the older ones are in the scheme too. What remains unclear is whether the new blood also enjoy this scheme now that amk mentioned its been taken out in 1995... or u guys already know it still applies in ministers but no longer in civil servants???
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