Parliament: No increase in ministerial salaries, review after 5 years or when it becomes necessary, says DPM Teo Chee Hean

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

SINGAPORE - Ministerial salaries will remain unchanged and will be reviewed after five years or when it becomes necessary, said Deputy Prime Minister Teo Chee Hean on Thursday (March 1).

The Government has taken the decision as a scheme for determining the salaries of ministers and office-holders remains valid and the economy is still in transition, he added during the debate over the budget of the Prime Minister's office.

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 that started last year.

DPM Teo said the Committee to Review Ministerial Salaries, formed last year, had decided that the scheme to determine ministerial salaries remains relevant and sound.

But the committee noted a 9 per cent increase in benchmark salaries, and recommended adjusting political salaries "annually in line with annual benchmark movements".

"The Prime Minister has written to the committee to thank the committee for its work and the well-considered recommendations. The Government has decided that since the scheme remains valid and the economy is still in transition, we will not change anything now and will maintain the current salary structure and level," said DPM Teo. "We will review the matter again after five years or when it becomes necessary."

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 Prime Minister Lee Hsien Loong formed the Committee to Review Ministerial Salaries last year in line with this.

DPM Teo said the 2017 committee - chaired by accountant Gerard Ee and comprising eight other members - reviewed the salary framework and submitted its views and recommendations to PM Lee in December last year.

Among the adjustments it recommended are to adjust political salaries yearly in line with with annual benchmark movements.

The benchmark, endorsed by the House in 2012, links ministerial salaries to the median income of the top 1,000 earners who are Singaporean citizens, with a 40 per cent discount to reflect the ethos of political service.

DPM Teo said the committee noted that the benchmark salary for a minister at entry "MR4" grade, inclusive of bonuses, had gone up by 9 per cent since 2011. This works out to a compound growth rate of 1.5 per cent per year over this period.

 

However, there has been no adjustment made to political salaries over the period, the committee said.

The annual salary for an entry "MR4" grade minister is currently set at $1.1 million. Based on the committee's recommendations, it would go up to $1.2 million.

Explaining why the Government decided not to make any changes to ministerial salaries, DPM Teo said since the committee has affirmed that the current salary structure remains relevant and sound, "therefore, we should maintain this structure".

He added that while the benchmark salary has gone up in general since 2011, the benchmark salary last year was lower than that for 2016.

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