Singapore Ministers Pay, Legitimised Corruption

Singapore Review, 2 May 2003 (updated May 2005)

By Mellanie Hewlitt

The headlines blared loudly in the 2 May 2003 issues of the Straits Times and usiness Times "Pay cut? Ministers ready to lead by example: DPM", announcing to the entire world this selfless act of leadership by Singapore's Ruling Elite.

In what appeared to be an initial move to reduce severely inflated salaries, to more reasonable industry standards, Singapore's Ruling Elite have bowed to public pressure and hinted at accepting a pay cut.

Or have they?

What exactly does "Leading By Example" mean? Lets try to put some substance behind those brave words. As of last count, average take home pay of a Singapore minister was well in excess of SGD100,000/- a month.

The below table puts things back in proper perspective: (these are basic figures as of July 2000 and did not include last year's pay hikes or other benefits. Otherwise the updated numbers may well be much larger)

1. Singapore President's Basic Salary US$1,483,000 (SGD$2,373,100)*a year Singapore Prime Minister's Basic Salary US$1,100,000 (SGD1,958,000) a year

Minister's Basic: US$655,530 to US$819,124 (SGD1,166,844 to SGD1,458,040) a year

2. United States of America President: US$200,000 Vice President: US$181,400 Cabinet Secretaries: US$157,000

3. United Kingdom Prime Minister: US$170,556 Ministers: US$146,299 Senior Civil Servants: US$262,438

4. Australia Prime Minister: US$137,060 Deputy Prime Minister: US$111,439 Treasurer: US$102,682

5. Hong Kong Chief Executive : US$416,615 Top Civil Servant: US$278,538 Financial Sec: US$315,077

Source: Asian Wall Street Journal July 10 2000 *Singapore President's salary which was updated in 2005 from the Singapore Straits Times

In relative terms, less then 20% of Singaporeans here have take home salaries

exceeding SGD100,000/- A YEAR.

In stark contrast, BASIC SALARY FOR A MINISTER STARTS AT SGD1,166,844 A YEAR,OR JUST UNDER SGD100,000 A MONTH.

What these ministers earns in just ONE MONTH exceeds the ANNUAL TAKE HOME

salary of 80% of Singapore's income earning population. Lets not even begin to compare annual packages which will exceed SGD1 million easily.

With the above numbers and figures now in perspective, it is easier to give substance to the words "leading by example". Several facts are noteworthy here;

a) That the ministerial salaries are grossly out of proportion, even when compared with their counterparts in much larger countries (US and UK) who have far heavier responsibilities.

b) That these salary reductions were long overdue. In the past, such handsome remuneration were "justified" on the back of resounding performance. However, Singapore's economy has been in the doldrums of a recession for several years now (with beginnings reaching as far back as the 1997 Asian economic crisis). This economic barometer is a rough measure of performance and implies that ministerial salaries were due for review at least 3-4 years ago.

c) That adjustments should be made to bring them back within the industry benchmarks. Taking the salary of US vice president as a rule of thumb, the percentage for reductions should start at 50% of current pay. Even if a Singapore minister takes a 50% pay-cut, he would still be earning much more then the US vice president.

d) The percentage reductions should greater then 50% if the intent is to bring the salaries within the perspective of Singapore's domestic scene.

With such inflated figures, it is understandable why the local government controlled media (Singapore Press Holdings) have taken pains to exclude mention of actual numbers for the world to see. The numbers would be too glaring and no amount of window dressing or creative writing could have reconciled these numbers with a sane figure and restored credibility.

Also relevant is the question whether such highly paid million dollar ministers can ever relate to the plight of the average man on the street. The remarks of Mrs Goh Chok Tong, that a SGD600,000/- per annum salary (of NKF CEO) is PEANUTS, is a harsh reflection of the real mind-sets, priorities and values of Singapore's million dollar ministers. And it is these same million dollar elitist bureucrats who will shape and determine public policies which will touch on the daily lifelihoods of every Singaporean.

It is unlikely that Singapore's Ruling Elite will accept such huge salary cuts. Exactly How much and when the ministerial pay-cuts takes effect is not revealed. Ask any man on the street and 9 out of 10 responses indicate many agree the current ministerial salaries are grossly inflated, especially in these lean and difficult times.

Said a long time forumer from an internet political chat group:

"First of all the Ministers are NOT leading on pay cut. Workers' salaries have been drastically reduced since the beginning of the recession while thousands have been unemployed. so the Ministers are NOT LEADING. they are only CATCHING UP. And they have several decades to catch up on."

"Secondly, how much of a pay cut will Ministers take? 10%? 20%? unless its a cut that will affect their lifestyles, it is merely symbolic and they would still not know what it feels like to be a normal worker. as such, this is not Leading by Example. Its just another bogus political propaganda stunt"

A 29 yr old executive who requested to remain anonymous admitted sheepishly ; "The numbers (ministerial salaries) are a national embarrassment really, because it reflects the underlying materialistic value systems of Singapore Ministers. No matter how you look at it, the fact remains that our ministers are money faced, and these are supposed to be Singapore's leaders, with value systems that Singaporeans should follow." "It (the ministerial salaries) puts Singapore in a bad light in the eyes of the world. The rest of Singaporeans really put in an honest days work for every penny they earn. And the process for review and approval of the ministerial salaries is also a joke. Imagine sitting on the board and approving (on White Paper)your own salary increments! Its all a wayang show".

This also raises the question as to the authenticity of the actual process for review and approval of cabinet minister's salaries. Who decides on these numbers? Is there independence and transparency?

Veteran opposition figure J.B. Jeyaretnam on Wednesday, Nov 20, 2002 challenged Singapore government ministers to take a pay cut to show they understand the economic hardships faced by the public. And the over-riding concern is that Singapore's Ruling Elite are unable to appreciate the economic hardship that the masses face in these tough times.

The growing public resentment comes afew months after PM Goh's careless comments that "lay-offs were not all bad", drew a backlash from the public with a flood of e-mails being sent to the foreign press to register public indignation.

It is a revelation that when the "paycuts" were finally effected they amounted to a miniscule 10% haircut from the massively bloated ministerial salaries.

It is also a revelation that barely a year later (in June 2004) the bloated ministerial salaries were restored and increased beyond their original levels even as the rest of Singapore was still struggling in the throes of a recession. (There were no CPF restorations for the rest of working Singaporeans).

Source Sg_Review group

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