The reasoning of the Government was also articulated by then Minister of Finance (Hon Sui Sen), and Goh Chok Tong. Essentially, it is to "remove the financial disincentives for staying on" as a office-holder, as compared with office-holders who retire and take on private jobs (and get their pension at the same time). This is similar to civil service pensioners who are re-employed by the government, after retirement.
(Of course, an interesting question is whether the Ministers/office-holders should be on a pension scheme at all. JBJ said yes during the 1982 debate, but that was in an era when all civil servants were under the pension scheme. That is no longer the case now - only civil servants in the elite administrative service, intelligence service and some judges - there may be a tiny minority of others - that are on the pension scheme now.)
You can read the extract from the Parliament report below.
Extract from the debate in Parliament on 31 Aug 1982 (from Parliament Reports).
PARLIAMENTARY PENSIONS (AMENDMENT) BILL
Order for Second Reading read.
4.45 p.m.
The Minister for Finance (Mr Hon Sui Sen): Mr Speaker, Sir, I beg to move "That the Bill be now read a Second time."
Under section 4 of the Parliamentary Pensions Act, 1978, an office-holding Member must satisfy the following conditions to qualify for the grant of a pension:
(a) he must have a minimum period of eight years' reckonable service as an office-holding Member;
(b) he must have attained the age of fifty years; and
(c) he must have ceased to hold office.
However, subsection (3) of this same section says that the pension shall not be payable in respect of any period during which he is again an office-holding Member. At the end of that period, the pension shall again be payable and shall be recomputed with the addition of that further period to the period of his former reckonable service as an office-holding Member.
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These provisions have the unintended effect of penalising the longer serving office-holding Members. Maximum pension of two-thirds of the office-holding Member's highest annual salary is earned when he has given a total of 18 years of service. Service beyond the period of 18 years does not earn more pension despite the provision for recomputation. In fact, as he continues to serve, his expectation of life decreases and the value of his pension benefits which are suspended falls progressively. Should he die in harness, the value of his pension benefits decreases to zero. I hope this will never happen but unfortunately it is more than a possibility for the older office-holding Members.
One remedy is for office-holding Members to retire after they have qualified for pension and take up if they want, non-Parliamentary or private jobs. Several former Ministers like Dr Toh Chin Chye, Mr Lim Kim San, Mr Jek Yeun Thong and Encik Othman Wok have done this. They are able to enjoy their pensions in addition to what they are paid in their new jobs. But several office-holding Members are needed by the Prime Minister to serve beyond 18 years. They should not be penalized for continuing to discharge their public office. Therefore, a more positive solution, to achieve equity, is to remove the financial disincentives for staying on.
In the case of Government pensioners re-employed by Government, their pensions do not cease to be paid during their re-employment. There is no valid reason why Parliamentary pensions for office-holding Members should not also continue to be paid to such re-employed Members. The Bill before this House seeks to remedy this by enabling an office-hold-ing Member to draw a pension when he has a total of eight years' reckonable service as an office-holding Member and attained the age of 55 years even though he is still holding office. When he ceases to hold office, his pension will be recomputed taking into account his further period of reckonable. service.
This Bill also provides for a former office-holding Member who is drawing a pension to continue drawing the pension should he serve again as an office-holding Member if he has attained the age of 55
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years. If he has not attained that age when he serves again, then he will continue to draw pension upon reaching that age. In short, this Bill will place those office-hold-ing Members who have qualified for the grant of an office-holding Member's pension in a position similar to that of Administrative Officers who are re-employed after their retirement at 55 years of age.
Sir, I beg to move.
Question proposed.
Mr Jeyaretnam: Mr Speaker, Sir, I rise to ask what is the need for this Bill at this particular moment. We have heard from the Prime Minister not very long ago of the grim years ahead for all Singaporeans, not just for Singaporeans but for most of the world. Steps have been taken in other countries to curb public expenditure, particularly in the form of salaries paid to Ministers and others in the public service.
What this Bill proposes to do, for all practical purposes - although it is paid in the form of a pension - is to increase the salaries that are already paid to those who will qualify under this Bill for the payment of pensions. If we take the case of the Prime Minister, what it will do is, for all practical purposes, to increase his salary by a sum of $132,000 annually.
If we take the First Deputy Prime Minister, what it will do is to increase his annual salary by a sum of $114,000. If we take the Second Deputy Prime Minister, what this Bill will do is to increase his annual salary by a sum of $103,995.
When it comes to Ministers who have served 18 years or more, what it will do is to increase their annual salary by a sum smaller than that of the Second Deputy Prime Minister, but not very much lower.
For a minute, Mr Speaker, Sir, I do not begrudge the Ministers the salaries paid to them. They have earned their salaries and they have done well for Singapore. But the question still has to be faced whether, in the present state of our financial situation, this Bill should be presented to Parliament to add on to the public debt the payment of
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an increase in salaries, because that is what it amounts to.
Again, Sir, I have with me, for the information of Members of this House, by way of comparison the salaries that are paid to Ministers, again, in Australia and in our nearest neighbour that is over the causeway. In Australia, the Prime Minister is paid S$253,470. This is his annual salary. The counterpart across the causeway in Malaysia is paid a sum of S$127,443. The Prime Minister of Singapore is paid $230,016, not very far below what is paid to the Australian Prime Minister.
May I say, Sir, that the Australian Prime Minister's salary that I have given here is the recommendation of their Remunerations Tribunal, which was made recently I think, and this is the salary that has been recommended for him for the future. But I read in one of the papers that, on his submission, this recommendation has been deferred for three months in view of the situation facing Australia.
If this Bill is passed, what it will do is to increase the salary of the Prime Minister from $230,000 to $362,000 a year for all practical purposes.
Then if we look at the Deputy Prime Minister's salary, byway of comparison, in Australia the Deputy Prime Minister is paid a sum of S$208,320. This is, again, the recommendation of this Tribunal which has not been implemented yet. The counterpart across the causeway is only paid S$116,361.
In Singapore, the First Deputy Prime Minister is paid a sum of $203,016. All these figures that I give include the allowance paid to the Ministers as Members of this House. The Second Deputy Prime Minister in Singapore is paid $188,016. So the result of this Bill, if passed, will be to add, for the First Deputy Prime Minister, a sum of $114,000 annually to his present salary, and to the Second Deputy Prime Minister a sum of $103,995 to his present salary.
If we look at Cabinet Ministers, again, by way of comparison, in Australia a Cabinet Minister is paid S$173,670. The counterpart across the causeway is paid S$105,279. In Singapore it is $170,016,
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again, inclusive of the allowances paid as Members of this House.
And if you move further down to Ministers and Ministers of State, what do we find? In Australia, they are paid S$163,380. In Malaysia they are paid S$88,656 and in Singapore a Senior Minister of State is paid $127,176 and a Minister of State is paid $109,896.
Mr Speaker, Sir, I have for comparison purposes not taken salaries paid in other countries in this region. I have not, for a minute, tried to compare the salaries paid in Singapore with the salaries paid, for example, in India. I have taken, I thought in fairness, the salaries paid in Australia. But one must remember that the salary structure in Australia is quite different. There, the salaries are generally much higher for employees and workers and the salary structure is different. Yet we find that what we propose to do in Singapore, if this Bill is passed, is to pay our Ministers far in excess of what they pay in Australia.
Mr Speaker, Sir, as I said, I do not begrudge the Ministers, for a minute, the salaries that they should be paid. But it is a mistake to think that the only attraction for public service is the salaries that will be paid or the pensions that they will be able to draw. It may, may I say respectfully to this House, attract the wrong sort of persons because one comes into this public service not for what one can get out of it but what one can give to his country and to his fellow men. That, I am sure, must have been the motive which led our Prime Minister and his team, when they entered politics in 1959, to guide the destiny of this country. So I think it will be a folly to think that because they are Ministers, they carry responsibilities, and therefore they must be paid very high salaries.
This brings me to the point of whether the Government in Singapore is costing the taxpayer perhaps a little too much. The high cost of government, I find, Mr Speaker, Sir, that in salaries alone paid to Ministers, going down from the Prime Minister to the Ministers of State, is an annual sum of nearly $4 million. This is in payment of salaries alone to Ministers in the Government. We have, unique to Singapore, two Deputy Prime Ministers.
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One of them is, of course, in full-time charge of a Ministry. The other would appear to be a supernumerary, super-annuated. And his main task, as I see it at the moment, seems to be to write long letters to the press as the political propagandist for the Government and the People's Action Party.
Mr Speaker, Sir, I would urge the Minister to reconsider this Bill; whether it is right that the taxpayer should be burdened with these additional sums. They are not small sums. They are quite large sums particularly, I repeat, when the Prime Minister has drawn the attention of Singaporeans to the bleak future facing this country for the next year - I do not know how many years - and for the need to tighten our belts.
Mr Speaker, Sir, we have had NWC recommendations and this year's NWC recommendations, I need not remind Members of the House, are $18.50 plus 2.5% to 6.5%. The salary increases that are offered for our workers are very, very meagre compared to what increases (i keep saying "increases" because that is what it really amounts to) that are being offered to our Ministers.
I think it is wrong, if I may say so, Mr Speaker, to try and equate service in the Government as a Minister holding a political office with that of the Administrative Service. It is wrong. For one thing, they are two different things. In the Administrative Service, the officer is paid to do a job and he does not enjoy the authority, the prestige, and the dignity that go with the appointment to a political office. So it will be wrong, in my submission, to try and equate service in the political field with that of service in the Administrative field.
I have spoken about the high cost of government in Singapore today. I have mentioned about the salaries. I have tried to tot up the sum that is provided in the estimates for Administration, just pure administration of this country of over 2 1/4 million people. I would like to know what the exact figure would be from the Minister, if he is able to give that answer. The figure that I find is staggering, and I would urge the Minister to consider whether it is time that we examined Government
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expenditure, particularly in the salaries, and other economies that may be effected. I would propose to the Minister that this Government should give serious consideration to the appointment of a commission now in Singapore to examine Government expenditure to see and to recommend what economies can be effected in Government spending without reducing efficiency.
We have, Mr Speaker, Sir, in our society unfortunately people who need welfare, people who find it a burden to pay their hospital bills, people who are unemployed and who do not get any unemployment benefits, and people who are aged. I was reading in the Straits Times (I think it was yesterday) the speech made by a Minister about the plight of the aged in Singapore. In my view, it should be possible for some of these savings in Government expenditure to be directed towards caring for the needy and the less privileged in our midst. That is a deserving cause. We should not merely attempt to look after those in our society who are able to look after themselves, who can earn for themselves, sufficient to keep themselves. We should concern ourselves with those who are unable to do this, and we should see whether, with the funds and money available, this can be done. And I say, Mr Speaker, Sir, that it can be done if a serious attempt is made by this Government to examine Government expenditure to see what economies can be effected.
Mr Speaker, Sir, I oppose this Bill.
Mr Hon Sui Sen: Sir, I have been listening very patiently to the Member for Anson what he has been speaking on this Bill. May I remind him that this is a Parliamentary Pensions (Amendment) Bill and not the budget. I thank him for his advice on how to run a surplus in the budget. But let me assure him that I am able to find from the budget enough money to pay for the parliamentary pensions that are proposed in this particular Bill. I am also able to find the money to pay the Judges, whatever is considered proper to them. Civil servants who have had revisions of their salaries need not fear that there will be no money in the budget
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to pay whatever it is that have been awarded to them. My own feeling is that civil servants are worthy of their hire and that they should be paid whatever is due to them. That also goes for the Prime Minister, the First Deputy Prime Minister, the Second Deputy Prime Minister, and so on.
As I said, these are matters which are irrelevant. In this particular case, all I am asking is that persons who have served Parliament for at least eight years as office holders should be paid parliamentary pensions and which would be due to them if they retire, as he has suggested.
I do not think I want to answer any point on what salaries are being paid in other jurisdictions to Ministers or Prime Ministers. They are totally irrelevant to this Bill.
Mr Goh Chok Tong: Mr Speaker, Sir, I wish to ask a point of clarification from the Member for Anson. Am I right in interpreting that he is not against pensions being paid to Members of Parliament and Ministers? In other words, what is his stand on pensions being paid to Members of Parliament? I want that point to be clarified first. Leaving aside this particular Bill for the time being, what is his stand on pensions being paid to Members of Parliament or Ministers?
Mr Jeyaretnam: Mr Speaker, Sir, I have no quarrel at all with the payment of pensions to Ministers and Members of Parliament if they have served the requisite number of years in Parliament when they cease to hold office. But what this Bill proposes to do is to pay them pensions even while they are still in office, i.e. while they are holding office or have not ceased to be Members of Parliament. This is why I say that, for all practical purposes, what this amounts to is an increase in the salary that is being paid at the moment. Call it pension if you like, but what does it matter? It puts so much extra into the pockets of the Ministers.
Mr Goh Chok Tong: Mr Speaker, Sir, if the Prime Minister and the Cabinet Ministers who have earned pensions, having served the required term, were to retire and a new Prime Minister and Ministers are appointed, they too will be earning a salary. So, is there any saving at all to the Budget? Pensions will be paid to the Minis-
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ters and the Prime Minister who have retired and new Ministers and a new Prime Minister will be earning a new salary. So there is no saving whatever to the total Budget.
Mr Speaker, Sir, I am trying to pin the Member for Anson down on his point that, given the grim picture which he has painted about the economy, Ministers should not enjoy what is due to them because it adds a cost to the Budget. The point which I am making is that if you were to argue logically, if Ministers who have earned their pension under the Parliamentary Pensions Act were to resign, new Ministers have to be appointed and be paid salaries. So the argument that there is a saving is not logical.
Mr Jeyaretnam: Mr Speaker, Sir, I do not know quite exactly what the Hon. Minister intends by his question. Of course, if a Prime Minister should cease to hold office, then under the existing Act he will, of course, be entitled to a pension. I am not asking for a repeal of any provision in the Act. We are talking about this Bill which says that even whilst a Minister is holding office he should be paid a pension.
Mr Goh Chok Tong: Mr Speaker, Sir, precisely. If the amendment is not effected, then we are actually asking the Ministers and the Prime Minister, who would have otherwise earned a pension under the existing Parliamentary Pensions Act, to personally sacrifice a large sum of money which is due to them. They would have earned the pension under the Parliamentary Pensions Act if they were to step down from office. Have I put the point across?
If I may repeat, under the existing Parliamentary Pensions Act, certain Ministers would qualify for pension if they are not office holders, that is, if they step down from Ministerial office. So what we are, in fact, asking them to do is to make a personal sacrifice of what they would have earned, because they could now retire as Ministers, enjoy the pension, get a job outside; and new Ministers have to be appointed in their place. So there is no saving whatsoever on the Budget. We are, in fact, asking the Ministers who have worked very hard for the benefit of the country to make a sacrifice which is not
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very proper. This Bill merely seeks to rectify an undesirable anomaly.
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 Hon Sui Sen].
Bill considered in Committee.
[Mr Speaker in the Chair]
The Chairman: Clauses 1 and 2.
Mr Jeyaretnam: I am sorry. Are you taking the two clauses together?
The Chairman: Unless you want me to take them separately.
Mr Jeyaretnam: Please.
Clause 1 ordered to stand part of the Bill.
Clause 2 -
Question put, "That clause 2 stand part of the Bill."
Mr Jeyaretnam: Division, Sir.
The Chairman: Do you really want a Division to be taken, or a show of hands?
Mr Jeyaretnam: A show of hands.
The Chairman: Yes, that is easier. The Question is, "That clause 2 stand part of the Bill." As many as are of the opinion, say "aye". Show your hands.
Hon. Members (majority hand raised): Aye.
The Chairman: To the contrary, say "No", and show your hands.
Mr Jeyaretnam (hand raised): Nay.
The Chairman: One against. The Ayes have it.
Clause 2 accordingly ordered to stand part of the Bill.
Bill reported without amendment; read a Third time and passed.
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