Debate on ministries' budgets

Govt keeps ministerial salaries unchanged

Deputy Prime Minister Teo Chee Hean said the Committee to Review Ministerial Salaries had decided that the scheme to determine ministerial salaries remains relevant and sound.
Deputy Prime Minister Teo Chee Hean said the Committee to Review Ministerial Salaries had decided that the scheme to determine ministerial salaries remains relevant and sound.PHOTO: SCREENGRAB

It will not take up review panel's recommendation to raise pay, which has stayed same since 2011

Ministerial salaries will remain unchanged and will be reviewed after five years or when it becomes necessary, Deputy Prime Minister Teo Chee Hean said yesterday.

The Government has taken this decision because a scheme for determining salaries of ministers and other office holders remains valid and the economy is still in transition, he said during the debate on the Prime Minister's Office budget.

Mr Liang Eng Hwa (Holland-Bukit Timah GRC), Mr Alex Yam (Marsiling-Yew Tee GRC) and Mr Vikram Nair (Sembawang GRC) had asked for an update on a review of ministerial salaries.

The review was done by an independent committee formed last year and it submitted its recommendations to Prime Minister Lee Hsien Loong in December, said DPM Teo.

Its recommendations include giving pay increases to politicians and various office holders whose salaries have stayed the same since 2011.

The current salary framework was based on a White Paper on Salaries for a Capable and Committed Government published in 2012, which was debated in Parliament.

The independent committee that made the recommendations for the paper had suggested a review after five years, and in line with this, PM Lee formed the Committee to Review Ministerial Salaries last year.

STAYING AT CURRENT LEVEL

The Government has decided to maintain salaries at the current level and watch salary trends further.

DEPUTY PRIME MINISTER TEO CHEE HEAN, who said that while the benchmark salary has risen in general since 2011, it was lower last year than in 2016.

DPM Teo said the 2017 committee was chaired by accountant Gerard Ee and comprised eight other members.

They had recommended, among other things, that the political salaries be adjusted yearly in line with annual benchmark movements, to keep pace with market developments.

The current total annual salary of an entry-level minister is benchmarked to 60 per cent of the median income of the top 1,000 Singaporean earners.

The 40 per cent discount reflects the ethos of political service, to form the minister's salary.

DPM Teo said the review committee found this benchmark salary for a new minister at entry "MR4" grade had gone up by 9 per cent since 2011.

This works out to a compounded growth rate of 1.5 per cent per year over this period.

But in these six years, the committee noted, no adjustment had been made to political salaries.

As the annual salary for an "MR4" grade minister is $1.1 million, the committee's recommendation would raise it to $1.2 million.

Elaborating on why the Government is not taking up the recommendation, he said that while the benchmark salary has risen in general since 2011, it was lower last year than in 2016.

"Hence, the Government has decided to maintain salaries at the current level and watch salary trends further," he added.

DPM Teo also explained why the Government is retaining the current salary structure, saying the review committee had found that it continued to be relevant and sound.

The committee's chairman, Dr Ee, said that although the recommendations will not be implemented, he hopes enough good and capable people will continue to step forward and take up the "challenge of serving the country and doing something that goes down in history".

Managing director David Leong of PeopleWorldwide Consulting, a recruitment firm, noted that ministerial pay is "particularly sensitive" and people will criticise regardless of whatever the Government does, because they deem the salaries too high to begin with.

"They are not worse off vis-a-vis most Singaporeans," he said.

But, he added, the Government remains on a moral high ground by choosing not to raise salaries, especially given the recent reactions to the planned increase in the goods and services tax some time between 2021 and 2025.

A version of this article appeared in the print edition of The Straits Times on March 02, 2018, with the headline 'Govt keeps ministerial salaries unchanged'. Print Edition | Subscribe