Prime Minister Dr Mahathir Mohamad is looking for a win-win solution in tackling the rising pension payouts for retired civil servants.
Mahathir said this was needed as the government's coffers were strained with the need to repay national debts.
"We want to continue (paying pensions), but we have to find a way that the government can afford (to pay) and government officers and don't lose out," he said at a press conference in Kyoto today.
A video of his press conference was uploaded by Astro Awani.
Last Wednesday, Public Service Department director-general Borhan Dolah said beginning next year, new appointments in the public service may no longer be made under the permanent and pensionable schemes, but under an improved contract scheme.
He said the move was decided at a special Public Service Reform Committee meeting in October 2018, which wanted the civil service to be reduced in size in phases and based on need, while reducing the financial burden of pensions which was now reaching RM28 billion per annum.
Mahathir said the burgeoning cost of pensions was partly due to the previous "steep" pay hikes of about 25 percent under the Abdullah Ahmad Badawi and Najib Abdul Razak administrations.
"Najib's government didn't care at all about the burden that would be carried afterwards.
"He had so much debt, and most of our revenue now is being used to pay debts... or else the country will go bankrupt."
Mahathir said some top civil servants were now earning around RM20,000 a month, which was almost as much he was earning (RM22,826). This meant they would receive a pension of RM10,000 a month when they retire.
The prime minister said the new contract scheme for civil servants, however, had yet to be discussed by the cabinet.
On a different matter, Mahathir said he hoped the Finance Ministry could strike a deal to secure more samurai bonds from Japan.
He said Japanese Prime Minister Shinzo Abe had agreed to finance the bonds at a rate of 0.5 percent, lower than the 0.65 percent rate for the first round of bonds worth 200 billion yen issued in March.
"This is up to the Finance Minister (Lim Guan Eng). I have received the agreement from Abe so it is up to us to negotiate," he said.
During the press conference, Mahathir was also asked about his blog post yesterday in which he urged Malay Muslims to work harder.
He had compared the situation in Malaysia to Japan where he said the local population did all the work, including cleaning the streets, instead of outsourcing them to foreigners.
He said if Malays and Malaysians took up jobs now being done by foreigners, there would be more funds circulating in the country instead of the money being repatriated to other nations.
"Right now almost RM2 billion a month of our money is leaving the country. But that's okay... if that is how we like, what can I do?" he remarked.