Millions paid to dead pensioners

The AG’s report states that the JPA had overpaid pensioners, both alive and dead, more than RM 4.5 million.

(Free Malaysia Today) – A retired civil servant who was supposed to receive a monthly RM214.33 pension – received a hundred times that amount instead.

This was revealed in the 2010 Auditor-General’s Report, which said that the error was due to a decimal point error by the Public Service Department (PSD) and the Post Service Division (BP), the departments in charge of pension funds for government staff.

The particular retiree, now deceased, had received RM21,433 for 16 months.

The report said the pensioner had died in 2007, but due to the error, the government had to recover the overpaid sum by deducting from the retiree’s pension since July 2007 and will continue until May 2044.

“It was found that because of one misplaced decimal point, it has caused an overpayment of pension amounting to RM133,051 since January 2006 to May 2007,” said the report.

The AG’s report said that the PSD had overpaid pensioners, both alive and dead, more than RM 4.5 million.

An audit carried out between May and September 2010 to assess the extent of overpaid pension found:

  • based on over-paid pension register, from 2007 to September 2010, a total of RM2.57 million was paid to 1,975 pensioners/pension recipients who are deceased; and
  • of the total, some RM0.85 million was recovered from 965 beneficiaries. For the balance of RM1.72 million which should be recovered from the 1,010 deceased family members, only RM0.39 million is in the process of being recovered from 206 heirs via payments by instalments.

The report said the RM1.33 million is yet to be collected as notices of claim could not be delivered to beneficiaries, who are either untracable, shifted, or died; or that notices were sent out but refunds were yet to be made.

Records not updated

The AG’s report found that one of the reasons for overpaid pension is that the records on the pensioners’ deaths are not updated properly in the BP’s computer system.

(BP had developed the POWER or Pensions Online Workflow Environment, an integrated system to “modernise pension administration system” to ensure the payment of retirement benefits are accurately paid in accordance with the prescribed period. It was put in force since 2003 and fully functional since Oct 2004.)

The BP is supposed to update the information about the death of pensioners via monthly death reports downloaded from the National Registration Department (NRD) or when the death certificates are received from the beneficiaries who deliver them to the BP.

If the information from NRD does not match with POWER system, an “unmatch report” is issued.

“According to this report, between 2007 and September 2010, there was data on 2,262  pensioners/recipients, which was not updated because information such as names, IC numbers and birthdates were inconsistent in both systems,” said the report.

The report said another problem with immediate updating of the status of death and termination of payments was that death certificate submitted by the beneficiary came in late.