The Pensions Ordinance : the burden it is : the value of superannuation to the civil service

Abstract

Does any intrinsic value exist in a non-contributary pension scheme for civil servants? At the moment the Maltese Civil Service is in a peculiar position. The law that grants a pension to civil servants was made non-applicable to whoever entered the Service after the 15th. January 1979. The pragmatic result is that the younger recruits are more prone to quit at the first sign of advantage elsewhere, since they are not bound to the Service by either a sense of belonging, or by a tangible attraction granted at the end of a' loyal service'. State pensions are an old privilege which donned a modern legal aspect in the middle of the last century, when the modern system of the Civil Service was being established. This pension scheme followed the philosophy of the age, which paid out according to what was given in, as against the subsequent philosophy of paying out pensions according to what is needed. Thus, it recognises solely the service rendered and the rank attained, expressed by the salary reached. It is a non-contributory scheme granted by the State to its employees upon retirement. The reasons given for its cessation was that it is elitist and because it is a burden upon the public purse, once a good social security pension is in existence. The intrinsic value, both to the individual as well as to the Service, was ignored completely. It is a means of indicating the sociological group of those that belong to it. It is also of benefit to the State since its employees are encouraged to weather out all temptations to leave the Service prematurely. Not even from a financial aspect can it be described as a real burden because what is paid under this scheme is saved by the Social Security Pension Scheme. Besides, the gratuity which is paid on retirement, and which appears like a millstone around the financial neck of the administration, is in real fact a financial relief, since the actual pension is reduced when the gratuity is paid out. It seems that the structure of the Civil Service will be different in future. The permanency, which is the basic component in such pensions, will not cover all the posts. The higher posts will be occupied temporary by civil servants with a lower substantive post. Thus, their pensions will be granted upon the lower salary of their lower substantive post thus eliminating pensioniblity in the higher posts. The real value of this scheme is that it gives a sense of a corps spirit, especially to a body whose such spirit is very weak. It sets out this body apart, and requires of it a discipline and a purpose at which to strive.