"The proposed benchmark pegs entry-level Ministers’ salary to three-fifths of the median income of the 1,000 highest earning Singaporeans. This group represents the top 0.06% of Singaporean income earners. It presents no significant shift from the previous 2/3 M48 formula, which pegged Ministers’ salary to two-thirds of the median among a small group of 48 professionals, comprising top bankers, lawyers, MNC chiefs and others. This new formula still benchmarks Ministers’ salary against the richest of the rich, reflecting an approach that appears to be based on a number of questionable assumptions: Firstly, it assumes that Ministerial talents should be first looked for among the highest income earners. The Paper states that the benchmark “reflect(s) the calibre of the people which Singapore needs for good government”. Secondly, it expects most Ministers will be parachuted in from the top echelons of the private sector, rather than going through the paces of first being elected as MPs, gaining experience on the ground, before being promoted to junior ministers and finally full Ministers. Thirdly, it assumes that potential Ministers are often reluctant politicians, who consider entering politics to be a sacrifice and a burden, rather than a privilege to serve the nation, and they therefore need to be coaxed with monetary incentives before stepping forward." "In fact, by filtering out individuals who are—to put it bluntly—in it for the money, we could actually streamline the process of identifying capable and passionate political leaders who can take our nation forward." "With the new bonus framework, Ministers can expect to get 7 months’ bonus as part of their “normal” compensation package, and 13.5 months or more in an exceptional year. The latter will more than double their already high base salary. Sir, the purpose of a bonus is to provide an extrinsic motivation for a worker to perform well on the job, especially when his or her base salary is not high. However, entry-level Ministers’ base salary of $55,000 a month already puts them among the highest wage earners in Singapore, so there is little reason why it needs to be supplemented by such a large bonus. More importantly, we need to ask whether our Ministers are the type of people who need such huge bonuses to motivate them to perform well. Did they not all claim to have entered politics to serve the people? I recognise that the bonuses and allowances have been reduced from as high as 26.5 months under the previous framework. However, the proposed bonuses are still excessive. Such large bonuses are usually seen only among senior executives of large corporations, which of course are the very people the Paper proposes to benchmark Ministers’ salaries against. In fact, bonuses for political leaders are still largely unheard of in the rest of the developed world. Among the 12 well-governed countries and territories that the Workers’ Party studied, we have found so far that only one country—Japan—makes annual bonus payments to its Ministers. Japan’s prime minister received a bonus of just 2.6 months in 2011 . I also disagree with the approach of paying out bonuses of as high as 7 months for simply meeting targets. Last year, workers in Singapore got an average of just over 2 months of variable bonus , while our political leaders are set to receive 7 to 13 months of bonus, on top of their already high base salary. To bring bonuses down to a more acceptable level, I propose that the total variable component should not exceed 5 months, even in a very good year. If all targets are just met, the payment should be about 3 months. This is in addition to their 13th month Annual Wage Supplement." "In summary, Mr Speaker, I support some of the proposals in the White Paper, including the removal of pensions and the introduction of the National Bonus. However, I fundamentally disagree with the top-down approach of benchmarking Ministerial salaries to top income earners, as well as the principle of paying out huge bonuses to political leaders. Mr Speaker, for these reasons, I oppose Motion." - Gerald Giam, WP NCMP geraldgiam.sg/2012/01/speech-in-parliament-on-ministerial-salaries/
Posted on: Mon, 26 Aug 2013 08:44:45 +0000
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