Just compensation for civil servants

On a visit to Singapore in 2012, my wife and I listened in amazement as our taxi driver ranted about the excessive salaries that, he said, government officials in his country were paying themselves. “Their lives get better every year,” he went on, “while the rest of us ordinary folks slide into poverty no matter how hard we work.” Comments like this reached a peak just before the 2011 general elections, whose outcome confirmed a stunning decline in the public approval of the ruling People’s Action Party.

As I found later, the context of the taxi driver’s outburst about government compensation rates was the report of the “committee to review ministerial salaries.” Singapore’s Prime Minister Lee Hsien Loong had promptly ordered the sharing of the report with the public, preparatory to its being debated in parliament. The prevailing sentiment favored a scaling down of salaries, and the committee echoed this in its recommendations. Interestingly, the head of the committee, Gerard Ee, was from the private sector, as were a good number of its members. In his letter thanking them for their work, PM Lee noted the complexity of the effort to “strike a balance between attracting capable and committed leaders of integrity, strengthening links with our socioeconomic progress, and reinforcing the ethos of public service.”

Whatever one might say about Singapore, that country has always prided itself in being a meritocracy. It sees the need to recruit the best, the brightest, and the most capable of its people to government service as a condition for the nation’s continued progress. Singapore’s leaders believe that public service is a calling and a privilege, but they also feel it should not be seen as a form of sacrifice. This means, among other things, that the salaries of public servants must not differ widely from those in the private sector. In 2009, salary levels in government were at par with, if not somewhat higher than, those in the private sector. In 2012, the committee recommended a 36-percent cut in the salary of the prime minister. The effect of that slash was carried down the line.

But even at diminished levels, what Singapore pays its civil servants still look incredibly high compared to Philippine government salaries. According to the recent report of the Commission on Audit, the highest paid Philippine government official in 2013 was the president and general manager of the Government Service Insurance System. The COA said Robert Vergara received P12.08 million in total compensation for that year. The amount may seem astounding, if not scandalous, but, in fact, it is less than one-third of the annual salary of S$1.1 million (P38.5 million) of an entry-level minister in Singapore. PGM Vergara is charged with the responsibility of managing a multibillion-peso portfolio in the volatile global financial market and of protecting the value of GSIS members’ contributions.  If he applied as an investment banker in some midsize company in Singapore, Hong Kong, or even Makati, he would probably not have a hard time negotiating at least twice that salary. That he has chosen instead to work in government must count for something.

Yet, the other day, using the same COA report, radio commentators had a field day heaping sarcasm and bile on highly paid government officials like Vergara, making no distinctions whatsoever and drawing freely from the general contempt reserved for political appointees in this country. By what right, they asked, should a subordinate of the president get more than five times the salary of the president himself? Framing the issue in this way, they only succeeded in reinforcing the common misunderstanding that government work must be treated as missionary work and therefore does not deserve to be properly compensated.

It is not fair to judge people as being overpaid without looking at comparable compensation rates in the private sector for the same positions and responsibilities. The rates for Philippine civil servants, from the president down to the lowest clerk, are just totally unrealistic. Set by law and rarely reviewed, they reflect the enormous guilt that comes from having to govern a society where the people are mostly poor and hungry, more than the huge task that needs to be done in order to get the nation out of poverty and hunger.

At the ridiculously low rate at which the presidential compensation is pegged, it is not at all surprising to see his salary surpassed several times over by those of his own appointees to government-owned and -controlled corporations.  This doesn’t make sense. One cannot justify this state of affairs by saying that the presidency is its own reward. Less saintly individuals who occupy that position are bound, sooner or later, to compensate themselves in nontransparent ways.

But, more than this, consider the structural consequences. Because the salary of the country’s highest public official is pegged at a very low level, the government is unable to adjust the salaries of its public school teachers and university professors to make these competitive. Many are thus tempted to transfer to the private sector or to go abroad, even if this means breaking their contracts with the public institutions that subsidized their graduate training. Those who remain find themselves engaging in various income-generating activities not always complementary to their official work. In this manner does corruption occur in the least expected places, often rationalized in a tone reminiscent of the excuses offered by those who routinely take kickbacks from government projects.

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