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http://www.spp.org.sg/parliamentary-speech-on-ministerial-pay-review-ncmp-lina-chiam/
Parliamentary Speech on Ministerial Pay Review – NCMP Lina Chiam
Mr Speaker sir,
On the ministerial pay review headed by Mr Gerard Ee, I have only two major points to make. My priority in Parliament remains to be on sustainable economic growth and healthcare cost. My remarks in Parliament, including this statement, are ultimately geared towards speaking up for Singaporeans in these areas.
1. My first point relates to the formula of pegging the ministers’ base pay to 60 per cent of the median income of the top 1,000 Singaporean income earners. Mathematically, it is not clear how the salaries will go from here. Yes, this is a huge cut now. But there is a possibility that the new formula may even result in a higher base pay than what the old formula could provide, on a long-term basis.
There are many ways that the median pay for the top 1,000 earners can rise substantially in the next 5 years. Wealthy foreign business people could be given Singapore citizenships en masse. It could even be that the median pay for this group will rise much faster than the median of the top 48 earners.
But for me to form a more accurate opinion, I would need to see how the old and the new formulas would apply to the period from the year 2000 to 2010, on a backdated basis.
To do so, the Government would have to provide us with these figures. More importantly are the figures for the ministers’ bonuses as paid out each year according to the old and new formulas.
If the Government and the review committee are truly serious about promoting a ‘clean wage’ approach for Singapore’s ministers, without additional perks and allowances, then they must follow through with the spirit of that approach -
All these data on salaries and the specific amount of bonuses paid out each year must be published and made transparent for public scrutiny. To date, I believe such data is never released.
In the UK, the Freedom of Information Act allowed for the release of details of MPs’ expenses claim for the British public in the year 2009. If we in Singapore want to talk about ‘clean wages’, let’s go all the way – publish the bonuses paid out every year.
Mr Speaker, if the Government does not wish to follow the practices of ministerial pay in other countries, may I remind the honourable Members of this House at least to show some respect to our friends and neighbours and how they have decided to remunerate their leaders in their own countries. Let’s show some humility. We should not be telling them how to run their countries. There is no need to jeopardize our relationship with them.
2. My second point, in my opinion, is even more important for the good of Singapore.
Ministerial pay should be primarily driven according to KPIs that are specific to their ministerial portfolio. Each ministry should create a set of KPIs for their minister, and the minister’s pay is to be objectively decided by a formula that is ministry-specific. As a guide, the KPIs for the Permanent Secretary of the relevant ministry, as the most senior civil servant, should be taken into account.
Yes, I know that there is the Performance Bonus component, which is rewarded based on the individual performance of ministers. But it is not clear what the criteria are in attaining this Performance Bonus. The review committee’s report says that “The Performance Bonus quantum will be reduced substantially”. I am not sure whether the bonus formulas are well structured to drive ministers towards fulfilling their portfolio KPIs, and for the purpose of accountability.
The committee’s recommended formula for the National Bonus may be an improvement on the old GDP Bonus formula, but it is still too broad. Some cynics have even speculated that the recommendation for the old formula to be changed has come at a time when Singapore’s GDP growth will be slowing down.
For example, the Minister for Trade and Industry’s KPI for all his bonuses could be Singaporeans’ wage growth. The Minister for Transport’s KPI could be tied with the Minister for National Development’s KPI to control population growth and thereby, vehicle numbers.
Otherwise, the bonus structure gives me discomfort. For example, our transport system might be in disarray, or a major terrorist might escape from prison, but the ministers responsible for these incidents may still collect a full National Bonus, just because the economy has done well due to the good work of other ministers like the Minister for Finance and the Minister for Trade and Industry.
No, this cannot be good for Singapore.
And that brings me to an overarching point – if the Government’s decision is still to match ministerial pay to the top earners of the private sector, then their accountability measures and KPIs must also match the rigour of the private sector.
* I turn the focus now to the junior minister’s new recommended starting salary of about $1.1 million per annum, bonuses included.
Mr Chiam See Tong once worked out what ministerial pay should be, in order that ministers would still be able to enjoy a comfortable lifestyle with hardly any “financial sacrifices”. He tabled the figure to be $50,000 per month, taking into account the mortgage and cost of a bungalow, the hiring of servants, two cars, annual holidays, and their children’s education. This was proposal was supported by then-NMP Professor Walter Woon.
To update that to today’s levels, the figure would be about $60,000 per month, or $720,000 per year. That amount, including bonuses, will be a good benchmark to prove their worth for a young minister with a young family. Moreover they still have their MP’s allowance of $192,500 to top it up.
This represents an approach that can be explained to people and be accepted by them.
For some of the new ministers, this new salary could be quite much more than their last drawn salary. Moreover there is no risk factor in the job like what stockbrokers face, for example.
Mr Lee Kuan Yew and the first generation of ministers had set up the government apparatus as it is today. Now our ministers inherit this system and continue with their jobs, and even enjoy the support of a credible and efficient civil service. Distinguished senior civil servants like Ngiam Tong Dow had also played a major role in building up our country.
When Mr Chiam See Tong entered politics and then was elected the MP for Potong Pasir back in 1984, people were afraid of associating themselves with him. His law firm began to suffer from a loss of business. He was ridiculed and mocked by various people for his involvement in politics. He was even at the receiving end of such comments from some judges when he was simply doing his work in the courts, defending clients.
But he never thought these as sacrifices throughout the years. He took it all in his stride. He saw it as part and parcel of his mission to fight for a democratic Singapore, a Singapore where no Singaporean is left behind.
I believe this is what being a servant leader entails. The spirit of public service is a calling, an honour and a privilege. It is something to be proud of.
Nevertheless I note that the Prime Minister’s mandate to Mr Gerard Ee’s committee was bound to comparing ministerial salaries to private sector salaries, through the terms of reference. So that conclusion was already set before the committee met, unfortunately. The Singapore People’s Party pushed for a stronger public service ethos to be emphasized in any review of ministerial pay, but this committee was just doing its mandated job.
The SPP wishes to thank Mr Ee and his committee.
Thank you Mr Speaker.
Parliamentary Speech on Ministerial Pay Review – NCMP Lina Chiam
Mr Speaker sir,
On the ministerial pay review headed by Mr Gerard Ee, I have only two major points to make. My priority in Parliament remains to be on sustainable economic growth and healthcare cost. My remarks in Parliament, including this statement, are ultimately geared towards speaking up for Singaporeans in these areas.
1. My first point relates to the formula of pegging the ministers’ base pay to 60 per cent of the median income of the top 1,000 Singaporean income earners. Mathematically, it is not clear how the salaries will go from here. Yes, this is a huge cut now. But there is a possibility that the new formula may even result in a higher base pay than what the old formula could provide, on a long-term basis.
There are many ways that the median pay for the top 1,000 earners can rise substantially in the next 5 years. Wealthy foreign business people could be given Singapore citizenships en masse. It could even be that the median pay for this group will rise much faster than the median of the top 48 earners.
But for me to form a more accurate opinion, I would need to see how the old and the new formulas would apply to the period from the year 2000 to 2010, on a backdated basis.
To do so, the Government would have to provide us with these figures. More importantly are the figures for the ministers’ bonuses as paid out each year according to the old and new formulas.
If the Government and the review committee are truly serious about promoting a ‘clean wage’ approach for Singapore’s ministers, without additional perks and allowances, then they must follow through with the spirit of that approach -
All these data on salaries and the specific amount of bonuses paid out each year must be published and made transparent for public scrutiny. To date, I believe such data is never released.
In the UK, the Freedom of Information Act allowed for the release of details of MPs’ expenses claim for the British public in the year 2009. If we in Singapore want to talk about ‘clean wages’, let’s go all the way – publish the bonuses paid out every year.
Mr Speaker, if the Government does not wish to follow the practices of ministerial pay in other countries, may I remind the honourable Members of this House at least to show some respect to our friends and neighbours and how they have decided to remunerate their leaders in their own countries. Let’s show some humility. We should not be telling them how to run their countries. There is no need to jeopardize our relationship with them.
2. My second point, in my opinion, is even more important for the good of Singapore.
Ministerial pay should be primarily driven according to KPIs that are specific to their ministerial portfolio. Each ministry should create a set of KPIs for their minister, and the minister’s pay is to be objectively decided by a formula that is ministry-specific. As a guide, the KPIs for the Permanent Secretary of the relevant ministry, as the most senior civil servant, should be taken into account.
Yes, I know that there is the Performance Bonus component, which is rewarded based on the individual performance of ministers. But it is not clear what the criteria are in attaining this Performance Bonus. The review committee’s report says that “The Performance Bonus quantum will be reduced substantially”. I am not sure whether the bonus formulas are well structured to drive ministers towards fulfilling their portfolio KPIs, and for the purpose of accountability.
The committee’s recommended formula for the National Bonus may be an improvement on the old GDP Bonus formula, but it is still too broad. Some cynics have even speculated that the recommendation for the old formula to be changed has come at a time when Singapore’s GDP growth will be slowing down.
For example, the Minister for Trade and Industry’s KPI for all his bonuses could be Singaporeans’ wage growth. The Minister for Transport’s KPI could be tied with the Minister for National Development’s KPI to control population growth and thereby, vehicle numbers.
Otherwise, the bonus structure gives me discomfort. For example, our transport system might be in disarray, or a major terrorist might escape from prison, but the ministers responsible for these incidents may still collect a full National Bonus, just because the economy has done well due to the good work of other ministers like the Minister for Finance and the Minister for Trade and Industry.
No, this cannot be good for Singapore.
And that brings me to an overarching point – if the Government’s decision is still to match ministerial pay to the top earners of the private sector, then their accountability measures and KPIs must also match the rigour of the private sector.
* I turn the focus now to the junior minister’s new recommended starting salary of about $1.1 million per annum, bonuses included.
Mr Chiam See Tong once worked out what ministerial pay should be, in order that ministers would still be able to enjoy a comfortable lifestyle with hardly any “financial sacrifices”. He tabled the figure to be $50,000 per month, taking into account the mortgage and cost of a bungalow, the hiring of servants, two cars, annual holidays, and their children’s education. This was proposal was supported by then-NMP Professor Walter Woon.
To update that to today’s levels, the figure would be about $60,000 per month, or $720,000 per year. That amount, including bonuses, will be a good benchmark to prove their worth for a young minister with a young family. Moreover they still have their MP’s allowance of $192,500 to top it up.
This represents an approach that can be explained to people and be accepted by them.
For some of the new ministers, this new salary could be quite much more than their last drawn salary. Moreover there is no risk factor in the job like what stockbrokers face, for example.
Mr Lee Kuan Yew and the first generation of ministers had set up the government apparatus as it is today. Now our ministers inherit this system and continue with their jobs, and even enjoy the support of a credible and efficient civil service. Distinguished senior civil servants like Ngiam Tong Dow had also played a major role in building up our country.
When Mr Chiam See Tong entered politics and then was elected the MP for Potong Pasir back in 1984, people were afraid of associating themselves with him. His law firm began to suffer from a loss of business. He was ridiculed and mocked by various people for his involvement in politics. He was even at the receiving end of such comments from some judges when he was simply doing his work in the courts, defending clients.
But he never thought these as sacrifices throughout the years. He took it all in his stride. He saw it as part and parcel of his mission to fight for a democratic Singapore, a Singapore where no Singaporean is left behind.
I believe this is what being a servant leader entails. The spirit of public service is a calling, an honour and a privilege. It is something to be proud of.
Nevertheless I note that the Prime Minister’s mandate to Mr Gerard Ee’s committee was bound to comparing ministerial salaries to private sector salaries, through the terms of reference. So that conclusion was already set before the committee met, unfortunately. The Singapore People’s Party pushed for a stronger public service ethos to be emphasized in any review of ministerial pay, but this committee was just doing its mandated job.
The SPP wishes to thank Mr Ee and his committee.
Thank you Mr Speaker.
