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7. In relation to posts in the Federalised Departments Article 153 of the Federal Constitution will be construed as if Natives were substitulod fur Malays The Yang di-Pertuan Agong will continue to exercise his powers under Article 153 on the advice of the Federal Cabinet, but in relation to the Bomeo States there will be provision that such advice shall be given only after consultation with the Chief Minister of the State concemed In relation to the Public Service as a whole (as distinct from the Federalised Departments in the Bomeo States) Natives should be included with Malays for the purposes of the application of Article 153.
8. Until the Federal and State Govemments agree otherwise, in filling posts in Federalised Departments in the States the full qualifications normally required by the Federal Government for candidates for each grade of the Service will be brought into line with the qualifications at present in force in the States Instructions to the Public Service Commissions will provide that when a local candidate is in sight no vacancy will be filled except on a temporary or contract basis or by promotion of a serving officer.
9. To reassure officers seconded or transferred to the Federal Public Service, and to reassure officers in the States that Borneamsation will be given first prionty in the Federalised Departments, the Federal Constitution will provide for the establishment of a separate branch of the Federal Public Service Commission in each State. Subject to the directions given to them in relation to Borneanisation and schemes of service. these branches will have full authority, except as provided in paragraph 2 above, in respect of all appointments, promotions and discipline in the Federalised Departments. saving that the discipline of seconded officers will be a matter for the State Public Service Commission. The Federal Government will undertake that the members of these branches will be the members of the respective State Public Service Commissions together with not more than two members of the Federal Public Service Commission nominated by the Federal Government These arrangements will be subject to review five years after Malaysia Day While they are in force the State Government will consult the Federal Government before making any new appointments to the State Public Service Commissions.
10. Recruitment to Borneo Divisions IV and V and to Division III up to the maximum of scale C3 or equivalent grades will be by the State Public Service Commission for service in the State Recruitment to and promotion to posts above this scale will be by Federal Public Service Commission whether for federal service in the State or for federal service throughout Malaysia 1o facilitate such recruitment and general haison between the Federal and State Public Services, the Federal Government will establish branches of the Federal Establishment Office in the States.
11. New recruits 1o Federalised Departments and local and non-designated expatriate officers serving in these Departments who opt for liability to serve outside Bomeo will receive equal consideration for promotion with officers throughout Malaysia who are similarly liable. Within Federalised Departments officers without this hability will be eligible for promotion within the area of their original service caually with officers who are so liable.
12. Certain problems also arise from the citizenship requirements under the Federal schemes of service. Many serving officers in the Borneo States are British subjects (and probably also citizens of the United Kingdom and Colonics) who were born in Hong Kong Burma or other former British possessions in South East Asia, some of these officers may not qualify for Malaysian citizenship by operation of law immediately on the creation of Malaysia. The citizenship requirements of Federal schemes of service should not be applied to officers otherwise eligible to opt to join the Federal Public Service serving in Federalised Departments in the Borneo States on Malaysia Day. But in view of the traditional composition of the existing Borneo Public Services there will be further provision relaxing the citizenship requirements of the Federal schemes of service to the extent that it is the clear intention of candidates for service to obtain Malaysian citizenship they will be eligible for appointments on contract or other temporary terms. When they subsequently acquire Malaysian citizenship they will be eligible for permanent appointment with up to four increments on the salary scafe, and the back-dating of their appointments for pension purposes only to the date of their origmal appointment on contract or temporary terms.
13. Subject to the transitional arrangements recommended in paragraph 24(25) (c) of the Report the Federal Government will assume responsibility for the pensions of all retired and serving officers of the State Public Services and the Chartered Company and Rajah's Services which preceded these services, including Widows' and Orphans' Pensions and Provident Fund payments. Future pensions legislation affecting these officers and their dependants will be a matter for the Federal Parliament but there will be constitutional provision protecting these officers and their dependants against changes to their detriment in pension terms. There should also be constitutional provision that the discretionary power to withhold, reduce in amount or suspend any benefit under such legislation may not be exercised adversely to any officer or his dependant unless appropriate Service Commission or corresponding authority concurs in this exercise of the discretion.
