TL;DR – It’s not about the money money money.
You might have heard a thing or two about it, or you might not but there was some buzz recently on the topic of ministerial salaries that went on in Parliament.
To give you a quick summary, the story dates back to 2012 where the Workers’ Party had put forward a formula in their response to the ruling party’s White Paper on Salaries for a Capable and Committed Government. The paper was authored by an independent committee appointed by PM Lee Hsien Loong.
Fast forward six years later, there was an exchange in Parliament on Monday 1 October on this topic of ministerial salaries between MP Alex Yam, MP Pritam Singh, Non-Constituency MP Leon Perera and Deputy Prime Minister Teo Chee Hean.
If you don’t know who’s who,
So what happened?
It all started on 10 September 2018 when NCMP Leon Perera asked the Prime Minister in each of the past five years, what has been the bonus paid to Cabinet Ministers in terms of (i) the average total number of bonus months (ii) the highest total number of bonus months paid to an individual Minister and (iii) the lowest total number of bonus months paid to an individual Minister.
This was what PM Lee provided in response,
The average Performance Bonus (PB), and the range of PB received by Political Office Holders of all grades over the past five years were:
The pay components of political office holders are set out in the White Paper on “Salaries for a Capable and Committed Government” tabled in Parliament in 2012. Apart from monthly salary, the salary components include 13th month Non-Pensionable Annual Allowance, Performance Bonus, National Bonus, and Annual Variable Component as paid to civil servants. The benchmark salaries take all these components into account.
The Prime Minister formed a Committee in 2017 to review whether the salary framework established in 2012 remains appropriate and valid against its intended goals, and what adjustments may be useful; and whether there is a need to adjust the salaries should there be a change in overall salary levels based on the proposed framework.
DPM Teo Chee Hean informed Parliament in March this year that the Committee had affirmed that the current salary structure for political appointment holders, including the National Bonus framework, remained sound. Therefore, we should maintain this structure. While the MR4 benchmark had increased by 9% since 2011, the Government noted that the 2017 MR4 benchmark was lower than the 2016 MR4 benchmark, and hence had decided to maintain salaries at the current level and watch salary trends further. That remains the position.
MP Alex Yam then asked on Monday, 1 October 2018 for a breakdown of the respective components of the salaries of ministers and the Prime Minister. He also wanted to know the amounts, in months of salary, paid for each component for each year from 2013-2017.
Things then get a little complicated from here but if you are interested, here is a very good article that explains the explanation made by DPM Teo Chee Hean who is the minister overseeing the civil service on the salary structure of Singapore’s ministers.
Additionally, in a written response to NCMP Leon Perera’s question in early September on bonuses, DPM Teo had revealed that political office-holders received 4.1 months of performance bonus on average in 2017.
Workers’ Party chief Pritam Singh also asked if in its response to Mr Perera’s question, the Government could have pre-empted the misinformation that later occurred online “had a fuller and more expansive reply been given”.
So after the very interesting back-and-forth exchange, DPM Teo then asked Mr Perera to reaffirm WP’s 2012 endorsement of the principles of salary determination, as laid out by a White Paper on government salaries. Mr Perera said there were no grounds for him to disagree on, though he noted he did not participate in the debate then. Mr Singh, too, said his party agreed.
Additionally, the formula proposed by the WP would have had a higher fixed component of some 81 per cent. “This would have made the link between salary and performance weaker,” noted DPM Teo. Currently, ministerial pay has a fixed component of 65 per cent.
If you still don’t quite understand the above, here’s the conclusion they agreed on:
1. All bonuses are already in the framework for ministerial salary system. They are not in addition to MR4 benchmark.
2. WP agrees with the principles of the salary determination.
3. WP’s formula in 2012 would have resulted in same quantum as White Paper formula. Hmmm… interesting food for thought here, if there were a WP government today, their ministers would be paid the same.