Civil servants to get 0.1 month year-end bonus, lump sum payment amid economic uncertainties

The Public Service Division said that restraint would be exercised for the year-end bonus payment for civil servants this year. PHOTO: ST FILE

SINGAPORE - Civil servants will be getting a lower year-end bonus, as the Government exercises restraint taking into account prevailing economic uncertainties.

The Public Service Division (PSD) on Monday (Dec 2) said all civil servants below superscale grade will receive a year-end annual variable component (AVC) of 0.1 month and an additional one-off lump sum payment of $250 to $1,500.

Civil servants in the lower pay grades will receive a higher amount.

Meanwhile, senior civil servants in superscale grades will receive a one-off payment of $400 in place of a year-end annual AVC.

The year-end civil service AVC is the lowest since 2009, during the global financial crisis. Amid negative growth that year, civil servants received a one-off year-end payment of 0.25 month, capped at $750.

The amount announced is also significantly lower than last year's, when public officers had a year-end AVC of one month. Lower-wage officers had received a minimum year-end bonus of $1,800.

The mid-year AVC of 0.45 month, paid out in July this year, also saw a slight dip from 0.5 month last year.

Taken together with the mid-year AVC, civil servants last year received a full-year AVC of 1.5 months, compared with a total of 0.55 month this year.

In a statement, the PSD said: "Taking into account the prevailing economic uncertainties, the Public Service Division, in consultation with and with the support of the public sector unions, will exercise restraint for the year-end bonus payment."

The Ministry of Trade and Industry has forecast that the economy will grow by 0.5 per cent to 1 per cent in 2019, with growth for the fourth quarter expected to remain modest.

The AVC, which reflects economic conditions, is typically set based on a multiple of a civil servant's monthly salary.

Commenting on the year-end bonus, National Trades Union Congress (NTUC) assistant secretary-general Cham Hui Fong noted that the outlook remains uncertain.

The public sector unions, comprising the Amalgamated Union of Public Daily Rated Workers and the Amalgamated Union of Public Employees (AUPE), thus agreed on a calibrated approach and to give more to lower-grade officers, she said.

The NTUC and public sector unions will work closely with the public sector to train workers and improve their employability, as well as ensure that they stay up to date on how the public sector is transforming itself, she added.

AUPE general secretary Sanjeev Tiwari echoed the need to keep up with sector transformation and said the lower payout is reflective of the lower economic growth expected for 2019.

He added that the unions have taken a cautious approach by having tiered payments for all, providing more to lower-income officers and less to senior officers.

"With the various transformation efforts within the public service, our focus remains on ensuring our officers are adaptable and ready for new roles," he said.

Maybank Kim Eng senior economist Chua Hak Bin told The Straits Times that lower civil service bonuses mirror weak economic performance and lower overall private wage growth.

"They reflect the uncertain and sombre economic reality," he said, adding that the private sector could take a leaf from the civil service's book when considering its own year-end payments. "Some private sector firms might benchmark their bonuses and increments against the civil service payout."

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