Parliament: Ministerial salary structure totally transparent, no hidden components or perks, says DPM Teo

Deputy Prime Minister Teo Chee Hean said that all the components of a political office-holders' annual salary are set out in the 2012 White Paper on "Salaries for a Capable and Committed Government". ST PHOTO: KUA CHEE SIONG

SINGAPORE - All the bonuses paid to an entry level minister form part of his $1.1 million annual salary norm, and are not in addition to that amount, Deputy Prime Minister Teo Chee Hean said in Parliament on Monday (Oct 1).

He said all the components of a political office-holders' annual salary are set out clearly in the 2012 White Paper on "Salaries for a Capable and Committed Government", which was submitted by an independent committee after extensive consultation with MPs and the public.

"The salary structure is totally transparent. There are no hidden salary components or perks," Mr Teo said.

In setting out how ministerial salaries are calculated, Mr Teo noted that the Workers' Party had in 2012 endorsed the three principles on ministerial salaries set out in the White Paper.

He also pointed out that the opposition party's proposed pay formula, which it had put forth during the 2012 debate on the issue, would have resulted in essentially the same total annual salary for an entry-level minister as that recommended by the independent committee.

Mr Teo's extensive explanation of the components of a minister's pay was made in response to a question from Mr Alex Yam (Marsiling-Yew Tee GRC), and comes in the wake of falsehoods about the issue resurfacing recently.

The claims that have been made online in the past month include accusations that the Government is not upfront about how ministerial salaries are calculated, and that the Prime Minister is being paid $2.2 million a year as a base salary, excluding bonuses, and that he earns a total of $4.5 million.

Mr Teo explained that ministerial salaries consist of fixed and variable components.

The fixed pay comprises the monthly salary and 13th month Non-Pensionable Annual Allowance.

The variable components of the annual salary comprise individual Performance Bonus, National Bonus and the Annual Variable Component.

Together, these variable components constitute 35 per cent of the total norm annual pay, with the fixed pay being 65 per cent.

All the components - fixed pay plus variable pay, including any and all bonuses - add up to form the norm level of $1.1 million for an entry level MR4 minister.

Mr Teo also noted that the Prime Minister's salary does not have an individual Performance Bonus as there is no one to assess his individual performance.

But to keep to the principle of making a significant part of the PM's total pay subject to performance, that is 35 per cent, the PM's variable pay has twice the national bonus compared to other ministers, to reflect national outcomes, in place of the individual Performance Bonus.

The independent Committee recommended in 2012 that the Prime Minister's total norm annual salary should be two times that of an entry level MR4 minister, or $2.2 million.

This includes all components, including his National Bonus, and there are no salary components or perks beyond this, Mr Teo added.

The ministerial salary structure and benchmark have not changed since 2012, he said, because the Government decided not to adjust salaries even though the MR4 benchmark had increased by 9 per cent.

Between 2013 and 2017, the National Bonus ranged between 3.4 and 4.9 months, with the average over the five years being 4.1 months, he said.

For Performance Bonus, the range was from three to six months each year, with the average across all the political office-holders over five years at 4.3 months.

As for the Annual Variable Component, the range was 0.95 to 1.5 months over the period and the average over five years was 1.3 months.

Emeritus Senior Minister Goh Chok Tong is not a member of the Cabinet, Mr Teo reiterated. So, ESM Goh has not received a ministerial salary since he retired from the Cabinet in May 2011, the Deputy Prime Minister said.

Mr Teo's detailed explanation on Monday of how ministerial salaries are calculated drew questions from the WP, with party chief Pritam Singh (Aljunied GRC) asking whether he agreed that the Government could have pre-empted some of the misinformation that occurred online by issuing a fuller and more expansive reply to WP's Non-Constituency MP Leon Perera's question.

He added that a parliamentary committee that had been tasked to look into the issue of online falsehoods had come to the conclusion that "it is actually more propitious for us to present all the information in an easy to understand manner for the public, and that would reduce the prospect of misinformation online".

Mr Singh, who was a member of this Select Committee on Deliberate Online Falsehoods, then read out one of the committee's recommendations, which calls on public institutions "to pre-empt vulnerabilities and put out information in advance where appropriate to inoculate the public", and "ensure that they communicate with the public in clear and comprehensible terms".

Mr Perera, who had sought a written answer on ministerial salaries, noted that his question had asked for total bonus months and not only performance bonus.

"Would that not have been an opportunity to... disclose and publish the national bonus level in addition to a performance bonus level?" he asked.

In response, Mr Teo said that the data which Mr Perera had asked for had been provided, but was then " misinterpreted and became widespread basis for false information".

And so, he said, he would clarify the issue, adding: " I'm delighted that Mr Pritam Singh and the Workers' Party are all for transparency and for debunking falsehoods... I hope that the Workers' Party will help us to clarify that position by putting it on your website also."

In wrapping up his response to Mr Singh, Mr Teo said the issue of ministerial salaries is a difficult one to talk about.

"It is an emotional one. There are misconceptions sometimes deliberately propagated. It is easily politicised."

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