Tee Soon Kay v Attorney-General

• Judge: Tan Lee Meng J
• Judgment Date: 30 August 2006
• Neutral Citation: [2006] SGHC 151
• Plaintiff Counsel: Ramayah Vangatharaman (Wee, Ramayah & Partners)
• Year: 2006
• Subject Matter: Whether public officers having right to pension under s 9(d) Pensions Act such that condition of irrevocability governing conversion from pension scheme to CPF scheme ultra vires,Article 112 Constitution of the Republic of Singapore (1999 Rev Ed), ss 8(1), 9(d) Pensions Act (Cap 225, 2004 Rev Ed),Construction of statute,Public officers voluntarily opting irrevocably to convert from pension scheme to Central Provident Fund scheme and then attempting to revert to pension scheme after more than thirty years,Purposive approach,Statutory Interpretation
• Published date: 13 November 2006
• Defendant Counsel: Jeffrey Chan Wah Teck, Owi Beng Ki and Goh Choon Hian, Leonard (Attorney-General's Chambers)
• Citation: [2006] SGHC 151
• Court: High Court (Singapore)

30 August 2006 Judgment reserved.

Tan Lee Meng J:

1 The plaintiff, Mr Tee Soon Kay, a public officer, together with and on behalf of a number of other public officers (collectively referred to as “the claimants”), who all voluntarily opted to convert from the pension scheme for public officers to the Central Provident Fund (“CPF”) scheme in 1973, claimed to be entitled to revert to the pension scheme even though it had been made clear to them at the material time that their decision was irrevocable. The Attorney-General opposed the application on the ground that the claimants had irrevocably opted to transfer from the pension scheme to the CPF scheme 33 years ago.

Background

2 The claimants were appointed to the public service before 1 December 1972. When first employed, they were on the pension scheme, which was then governed by the Pensions Act (Cap 55, 1970 Rev Ed) and is now governed by the Pensions Act (Cap 225, 2004 Rev Ed) (“the Act”).

3 On 14 May 1973, the Permanent Secretary (Finance) issued Finance Circular No 8 of 1973 (“FC No 8/73”). The main features of FC No 8/73 were as follows:

(a) All eligible officers were required to select one of two options with effect from 1 July 1973 (“the 1973 Option”).

(b) Once exercised, the option was irrevocable.

(c) The first option was to remain on the existing pension scheme.

(d) The second option was to convert from the pension scheme to the CPF scheme which was then governed by the Central Provident Fund Act (Cap 121, 1970 Rev Ed) and is now governed by the Central Provident Fund Act (Cap 36, 2001 Rev Ed) (“the CPF Act”). Those who chose the second option did not lose their accrued pension benefits, which were “frozen and [became] payable … as a lump sum upon … retirement under … pensionable circumstances”. Furthermore, those who had already served at least ten years could opt to have their accrued pension benefits payable as “commuted gratuity and reduced [annual] pension” on retirement under pensionable circumstances.

4 Had the claimants remained on the pension scheme, they could have looked forward to the granting of a monthly pension and medical benefits upon their retirement under pensionable circumstances. While some pensionable officers opted to remain on the pension scheme, the claimants were among many public officers who opted to convert from the pension scheme to the CPF scheme in 1973.

5 Evidently, the claimants must have thought that the benefits under the CPF scheme were more attractive than those under the pension scheme. To begin with, under the CPF scheme, the Government contributes a percentage of the claimants’ monthly salary to their CPF accounts. The Government’s monthly contribution to a public servant’s CPF account forms a part of that public servant’s savings and cannot be recovered from him if he leaves the public service before reaching the pensionable age. As such, the CPF scheme gave the claimants more career flexibility than the pension scheme, under which the question of eligibility for pension benefits does not arise in the case of a public servant who leaves the public service before reaching the pensionable age. Furthermore, CPF contributions are tax deductible and may be withdrawn to purchase homes. An additional carrot to those who opted for the CPF scheme was that their frozen accrued pensions as at 30 June 1973 could be used for the purpose of purchasing a house or flat.

6 In line with the claimants’ decision to convert to the CPF scheme in 1973, the Government has made monthly contributions to their CPF accounts for 33 years and during this period, the claimants have enjoyed other benefits under this scheme. Presently, most of the claimants have attained or are nearing the age at which they may retire. They now wish to opt out of the CPF scheme to return to the pension scheme. When the Government did not agree that they could do so, they instituted the present proceedings and sought the following:

(a) a declaration that the purported condition of irrevocability in the 1973 Option was ultra vires, null and void and of no effect;

(b) a declaration that they are entitled to rejoin the pension scheme, and to have their full service in pensionable office counted for the purposes of the Act, pursuant to the terms of s 9(d) of the Act; and

(c) such other orders or relief as the court deems fit.

Whether or not the plaintiffs are entitled to the declarations sought

7 The thrust of the claimants’ case is that the Permanent Secretary (Finance) had no legislative authority in 1973 to stipulate that their decision to opt for the CPF scheme was irrevocable because they have a right to a pension by virtue of s 9(d) of the Act and Art 112 of the Constitution of the Republic of Singapore (1999 Rev Ed) (“the Constitution”). In contrast, the Attorney-General asserted that while pensionable officers who retire in pensionable circumstances may be granted a pension, it is incorrect, in view of, inter alia, s 8 of the Act, to say that they have a right to a pension.

Section 9(d) of the Act

8 The claimants’ arguments in relation to s 9(d) of the Act will first be considered. Section 9(d) of the Act provides as follows:

No pension, gratuity or other allowance shall be granted under this Act to any officer —

(d) in respect of any service, including service deemed under any written law for the time being in force to be service with the Government for the purposes of this Act, during which the officer was —

(i) a member of any fund mentioned in the Second Schedule, except upon the condition that there shall be first paid to the Government the total amount paid by the Government to that fund excluding the amount paid on account of the officer if he is on the pensionable establishment with respect to the service or an equivalent amount if he is not on the pensionable establishment with respect to such service, together with the interest, if any, thereon; or

(ii) eligible for any benefits on retirement under the Singapore City Council Superannuation Fund for Subordinate Employees Rules 1954 except upon the condition that he shall first relinquish all rights to the benefits under those Rules.

9 The claimants, relying on s 9(d) of the Act, asserted that they are entitled to revert to the pension scheme after repaying the Government the total amount that the latter has had to contribute to their CPF accounts since the 1973 Option, together with interest. They argued that the Permanent Secretary (Finance) had no right to, in their own words, “disapply” s 9(d) of the Act when he stipulated that their decision to convert from the pension scheme to the CPF scheme in the 1973 Option was irrevocable.

10 Contrary to what the claimants asserted, s 9(d) of the Act does not pave the way for their return to the pension scheme as it does not create any right to a pension. It merely bars the payment of a...