Does Tony Tan continue to get his DPM pension?

Here’s a question that a noted academic posed to me last night: Does Tony Tan, now President, continue to collect his pension that came from his days as Deputy Prime Minister?

A follow-up question would be this: When he retires as President, will he get double pension?

Two laws are relevant here: The Parliamentary Pensions Act and the Civil List and Pension Act.

The former regulates salaries and pensions for members of parliament and office-holders whose jobs stem from being members of parliament. Such would include ministers and the Speaker of Parliament. Section 4 says that for an office-holder to be eligible for an office-holder’s pension, he must have served a cumulative eight years as an office-holder and have reached 50 years of age.

Tony Tan meets both these criteria, having been born in 1940 (which makes him 71 years old in 2011) and having first become a senior minister of state in 1979. He was promoted to a  cabinet minister a year later, in 1980.

He left for the private sector (but still remained a member of parliament) in 1991, returning to the cabinet in 1995 as Deputy Prime Minister, a post he held till 2005. He thus spent a total of 22 years as an office holder, which entitles him to the maximum pension of two-thirds of the highest annual salary he was entitled to. This is stipulated in Section 4(2A) of the Parliamentary Pensions Act.

Section 4(3) says:

Subject to sections 13 and 15, a pension granted under this section shall continue for the life of the person to whom it is payable but shall not be payable in respect of any period during which he is again an office-holding Member;

You may think, at first sight that this means his pension will be suspended while he is President, but it’s not so, because the operative term is “office-holding Member” where “Member” means member of parliament. A president is not a member of parliament.

There is no other provision for suspending the Deputy Prime Minister’s pension.

The president’s salary and pension is governed by a different law, the Civil List and Pension Act. Section 2 says:

There shall be paid for the civil list of the President so long as he holds office the yearly sums specified in the Schedule.

. . .  and the Schedule stipulates that the salary (known as “privy purse”) shall be S$4,267,500 per year.

As for the president’s pension, the amount is not stipulated (the better to intimidate any recalcitrant president into compliance?)  since Section 8 only says:

Subject to the provisions of this Act, any person who ceases to be President (referred to in this Act as former President) shall be granted a pension of such amount and on such terms as Parliament may by resolution determine.

However, it does appear that the intention is to pay a pension, since other sections of the law provide for pensions to go to widows of deceased presidents, and even deal with paying gratuities to dependents if a president or former president dies.

* * * * *

As was recently announced, the recommendations of the Ministerial Salary Review Committee is expected before the end of the year. When it comes out, we should scrutinise the report not only with respect to salaries, but also pension arrangements.

For example, not long ago, there was a biggish controversy over the fact that ministers reaching age 55 are entitled to start receiving their pensions even while they are still ministers and receiving a minister’s salary. This comes out of Section 5 of the Parliamentary Pensions Act:

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.

It will be ridiculous if this is not promptly amended to align with the natural meaning of the word “pension”, which is a payment after retirement. Moreover, the age of eligibility should follow along with the steadily increasing age (62, going on to 65) that is being imposed on all other Singaporeans.

22 Responses to “Does Tony Tan continue to get his DPM pension?”


  1. 1 ThePasserby 9 September 2011 at 12:03

    I’d say that our government, much like our society, subscribes largely to the moral dictum of: do whatever you can get away with; or do whatever you like, just don’t get caught.

    So I think TT will be given his pension on top of his president’s salary, provided the public is largely unaware of it.

  2. 2 aserialnumberonmyvote 9 September 2011 at 12:35

    Hmm…

    similarities to the questions raised about British bankers’ pensions in the UK and how ‘fat’ they are actually worth compared to the standard annual pay, or as a multiple of the modal/median wages in their country [or as a 100x multiple of their company’s lowest wage.]

    The pensions question in Singapore has been sidestepped by putting ordinary people in Singapore on defined contribution CPFs that draw down on private account balances, thus taking the pension burden off the state, yet highest state officials continue to receive final-salary pensions.
    [Is it me or do I feel double standards being applied here?!]

    “Do as I tell you, but not do as I do?”

    E.o.M.

  3. 3 georgelamb 9 September 2011 at 17:37

    There should be only one rule of thumb for public service pension – a pensioner whose last drawn annual income exceeds some large figure, say $1,000,000, should only receive ONE pension from govt. It should be the one paying him the most benefits.

    If we want to show appreciation for a job well done, the rule can be to allow him to continue to draw 10% of the other lesser amount pensions, ie highest pension + n x 10% of the rest. This is after all public money.

    And, by the way, if teachers, re-employed after their retirement get a cut in pay, I don’t see why the same do not apply to political appointees. All men are equal. So Tony Tan should be paid a presidential salary that should be accordingly reduced like the way the re-employed teachers’ salaries have been reduced. Only when political appointees subject themselves to all the rules and regulations they implement for others would they remain sensitive to what it is like at the receiving end.

    And since the govt is asking for the pensionable age to be moved upwards to above 60, parliament should set the example. I am rather surprised that MPs need only to attain age 50 years to qualify for pension when the current retirement age for civil servant, if I am not mistaken is 62?!

    So Alex, seriously, can you please consider starting a petition along ideas I have given above? You are perhaps the most credible and qualified among netizen for this job.

    Thanks

  4. 4 Chow 9 September 2011 at 19:01

    I may be misinformed but I always had the idea that they got rid of the pension scheme for most of the rank and file employees so as to put them on the CPF and yet they still retain their pensions? This bit of information makes it seem even more outlandish as there exists the possibility that they be paid a pension even while drawing a salary. The point of a pension is to allow a person to live/subsist without working. I really do hope that they get one but not the other while they are still active members of the Parliament or Cabinet.

  5. 5 Swiss 9 September 2011 at 21:33

    I think it is just sour grapes. What should be done is to return the pension scheme to active duty or make sure the CPF scheme is tweaked to safeguard old age.
    It seems unfair and it is unfair, but what can one really do about it?

  6. 6 Anonymous 9 September 2011 at 22:24

    Do you get a pension? I don’t. Most people don’t get one either. So the real question is why should he get one in the first place, don’t need to talk about getting two!

  7. 7 Ben 9 September 2011 at 23:49

    If the Ministers are paid CEO type salary, then they shouldn’t be getting the pension because CEOs generally don’t receive pensions. I would prefer that the Ministers receive lower annual salary plus pension which could be clawed back to make them accountable for policy failures.

  8. 8 Anonymous 10 September 2011 at 00:44

    What about Nathan? Does he get a pension?

  9. 9 Rabbit 10 September 2011 at 02:18

    Pension sounds like a steal to the person getting it. In old days, public servants served the people with humble takings thus pension was given as token of appreciation at the end of their sacrificial service to the people.

    In this days and age, our ministers topped the world leaders’ salaries combined, and god forbids what other multiple director’s fees or monetary perks under cover not fully disclosed to the citizens. Their wife or children’s may have directly or indirectly benefited thru business dealings if their husband or father is a ministers. Was there insider news prior to property bubbles, did any minister family bought properties at dirt cheap price prior to the influx of foreigners, did they enjoy benefit thru conflict of interest as public office holders….? How many assets did each of the top ministers hold locally and overseas? All these questions should be taken into considerations the wealth of our minister’s family to justify whether they were underpaid when formulating their salary package. Will they suffer dignity or poverty if pension is scrapped?

    Unlike public servants in the past, the current arrogant ministers treated themselves like King or “demigod” and wielded self-benefiting authority like not others, as such how can pension still be justified to the already overpaid “high mortals”? Under their service, were Singaporeans much happier than in the past? For every service ministers rendered, do they come free and not paid through our nose like GST, ERP, and HDB…?

    Besides, Pension is not an accumulated savings earned through minister’s own effort, there is no real hard work unlike CPF where citizens were “taxed” upfront from their blood money thru our own hard work. Thus I see no merit of minister taking pension/gratuities as gift to feed more than 4th generations of their family. Is this fair to lesser mortal when PAP preached about not wanting to raid the reserve and Singaporean should not turn into a welfare state by begging 3 meals, in hawker, food court or restaurant?, by a paltry $50 monthly subsistence?

    When the hardworking and stressful citizens are not going to see and breath their CPF at the end of their spend life, the ministers are taking taxpayers’ hard cash with ease as early as in their 50s, a huge benefits that even their children/grandchildren need not have to work their ass out to be able to enjoy early retirements under such inheritance

    Which independent party approved pension in the first place, or were they the pension holders who made their own approval and directly benefited from their ultimate decision?

    I see pension as a pest hiding in our vault, exempted from tax and estate duty once the person passed on to the next. The leaders are still enjoying state welfares even when they made blunders serving the people, while peasant still struggle to make ends meet. There are many ways of savings the people and our reserve, taking pensions off is one of a huge savings and surplus to help the needy without needing to go through rigorous charity shows.

    Let’s see what Gerald Ee will come out with at the end of this year and not some half-hearted and half-hidden information to insult analyst intelligence or people’s gut feel.

  10. 10 Leslie 10 September 2011 at 07:36

    I think I’m missing something here. Are section 4(3) and 5(1) of the pensions act in conflict? On the one hand, 4(3) denies the payment of pension while the person is again an office-holder. On the other hand, 5(1) says that a pension may be granted even if the person has not ceased to hold office?
    (p/s. will they do something about the sexist pronouns already)

    • 11 Tan Tai Wei 10 September 2011 at 11:05

      Maybe it means this. If a minister reaches 55, and continues at the job, he may be paid the pension. But if he leaves, and there is a break in appointment, but subsequently appointed “again”, then he is denied the pension during the reappointment period. (What if he qualifies again for pension during reappointment? He, like Tony Tan on retirement from presidency, will take two pensions?)

  11. 12 Tan Tai Wei 10 September 2011 at 09:05

    Probably that part of the Constitution was drafted with the inexcusable lack of foresight that should a former minister on pension got elected to be president he would be drawing both pay and pension. Inexcusable, for it was drafted to precisely tilt it in favour of retired ministers to become president. Or was it done deliberately in line with the policy of paying purported “market rate”?

    If only the lack of foresight, then Tony Tan should not benefit from an administrative lapse in order to get it unequitably, being “people’ president”. If deliberate, then even whilst pending Alex’s recommendation to rectify this “ridiculous” thing, Tony Tan and other officials in that similar situation should volunteer to forgo those huge double payments.

    And don’t say that others in the civil service who are re-employed alo receive pension and pay. Their pensions aren’t two thirds of 4 million or so, and their pay isn’t yet another 3 to 4.5 million plus 11 months bonuses. And they do not retire at 55.

  12. 13 Simon 10 September 2011 at 14:12

    Something ought to be done about this as there is probably a double standard here with regards to the policy of compensation. Since tax payer’s money are involved here why should government officials, be it minister, prime minister or president not be compensated like the rest of commoners – via the C.P.F. instead of pension. After all, the PAP argued that because of the so call “responsibilities of the ministers” they should have their salaries and benefits peg to the CEO of private Corporations, which indeed they are already. How much is enough anyway? Is pension really necessary especially when ministers performance on quite a few occasions have been shown to be wanting?

    With Tony Tan’s situation, surely the possibility of a double payout needs to be clarified – I think. This is not a question of over compensation even, just that it is too frivolous use of tax payer’s money. Like the case of buying insurance for fire protection for your house, even if you purchased three policies – should there be an occurrence of fire, the law clearly allows for only one payout. We should press the PAP ruling party to clarify and explain its position on where the line on pension is drawn. There should be no ambiguity, and with the approval of that compensation carefully debated in parliament before implementation. I hope the PAP is not going to accuse its citizens of creating a road block on this matter. If Tony Tan says that his aim is to serve the people, do not bicker about the money matter when he is already so well paid.

  13. 14 Robox 10 September 2011 at 14:13

    It’s called double dipping, folks. This time disguised behind a very sophisticated form of corruption that they call “law”.

  14. 15 Wee23@yahoo.com 10 September 2011 at 14:16

    Most of you here seem to miss out on one other key components that the Ministers also receive, but largely ignored. I believe there’s a stock options component – and that could very well come from the public-listed GLCs. There’s reasons why people like Lui Tuck Yew are supportive of a profit-driven SMRT over the people. How that components are calculated and given out, we need the Review Committee to reveal it. Let’s make sure they don’t get away with it too.

  15. 16 nhg 10 September 2011 at 18:21

    iy is a shame if this is true

  16. 17 Yujuan 11 September 2011 at 15:16

    As far as I decipher The pensions Act, Tony Tan is getting his pensions, and now he’s President,he’s getting another source of Income as President’s Pay, and when he retires from his current Post, he would get another pension from the Presidency.
    Simply, he will be getting 2 pensions. Shit,thought people are aware of this.

  17. 18 Lim Bt 11 September 2011 at 19:53

    Where and when did they feel shameful.when money is concerned. They are thick skin when salary is concerned. They pay themselves obscene salary. They are thin skin only when the opposition criticized them and then sue them. No shame at all.

  18. 19 Penetrated 12 September 2011 at 08:35

    What does this speak of the whiter than white men. If this is not a self-serving act, than what is. This is legal corruption of the highest order and to think one old man claimed that they have not enriched themselves, while another goes on to say that he feels rich everytime he sees his CPF statement..wait a minute..if LSS has CPF contribution, does he have pension as well

  19. 20 Paradox 15 September 2011 at 04:53

    We’ve had our chance for radical change, folks, with the GE and PE. However, it seems like we still prefer status quo…

  20. 21 Singaporeans Deserve Better! 24 September 2011 at 08:17

    The new media has shown us how the government has been deceiving us for so long. It has led to the unthinkable – an apology from the government and numerous about-turns like DBSS and HDB. It is time they realised that their old tricks no longer work and that we are a more knowledgeable, discerning and probing electorate!

    We, the people of Singapore, need to demand more transparency and accountability from the government – didn’t they admit to being our servants? More transparency after some disturbing revelations like some of them receiving their pensions even while receiving their out-of-this-world salaries! They took our pensions away from us and gave it exclusively to themselves. Many other disturbing news still float around like TT’s son’s favourable NS treatment – something that has been vehemently denied but never fuuly explored and investigated or even explained.

    We need more accountability after seeing how Ministers just shrug their shoulders and carry on without a care like the YOG budget, DBSS and more importantly the escape of Mas Selamat which could have had far-reaching repercussions for Singapore! And what does WKS do after his major boo-boo? He sacks those lower down the line but leaves himself untouched! And how does he get “punished” for such a major mistake? He gets appointed Special Advosor for Economic Cooperation for PM!!!! If this is not blatant nepotism, I don’t know what is!

    They justify their mega-salaries by telling us that to get quality, you must pay for quality. Well, we have been paying for quality all this time but looking at the many boo-boos, we are definitely not getting what we paid for!!! We, the people of Singapore, have made Singapore the miracle it is today by making sacrifices when asked to by the government – tightening our belts during the hard times, taking no bonuses and even going along with the many unjustified increases over the years (HDB, public transportation etc.)

    And what do they do while we make sacrifices? They increase their salaries, give themselves pensions, bring in FTs to replace us in the job market (mainly to increase their decreasing votes), give full-paid scholarships to foreign students while most Singaporeans struggle with their children’s education expenses. And to make matters worse, after bringing in FTs to replace us, they say that if we Singaporeans cannot compete with the hungrier FTs, that’s just too bad!!!

    I think more Singaporeans (especially those who voted for TT) should read George Orwell’s Animal Farm (or just read its analysis and underlying message) to “have their eyes opened” and see clearly what has been going on in Singapore for so long. Let’s keep our foot on the pedal and maintain the momentum of getting the government to listen more to us and to be more transparent and accountable!

  21. 22 alfretztay 5 October 2011 at 09:14

    There should be a limit on the number of sources of income in a year that a person gets, especially if he or she is or was a public servant. It is only logical. Unless he is an entrepreneur, if one has too many sources of income, I truly believe that it is likely a case of him being either overpaid or underwork!


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