Ministers and Senior Civil Servants Wages Up Up Up, Inflation Up Up Up

The wages of our dear ‘super-elite’ ministers and senior civil servants are going up ranging from 4 to 21 per cent. The funny is, the more money you earn, the more you are going to get. The President and Prime Minister enjoy the highest increase of 20-21 per cent. How the logic goes about increasing the most for the highest paid is beyond me.

In 16^th December 07 Lianhe Zaobao (yes, the economics journalist reads Chinese newspapers daily) page 4, Senior Minister Goh Cheok Tong mentioned, “The aim of increasing wages is to attract more talents into our government service and not so much about for the ministers. The ministers do not care about how much they are paid. In fact, most of them, including myself, donate part of their income to the charity.”

Increase wage to attract talents. Yet the ministers do not care about their page package. Aren’t the comments contradictory? If ‘talents’ are attracted into service by high wages, how can they not care about their pay package? And why does our SM have to mention the charity thingy? Who can confirm that? And why play the charity card now? Is it for the sake of promoting ‘understanding and sympathy’ among Singaporeans? Although Prime Minister Lee Hsien Loong had pledged to donate his pay increase to charity for 5 years, it must be taken note that pay increase is a permanent thing. Donating to charity is not. And basing the increase on the earnings of the top earners in 6 industries has no logic. These top earners earn the bulk of their enviable income as bonus. Next year, whether or not they continue to earn as much or more is not something you and I can say for sure. But, increases for the elites are permanent! Let's say the economy slows next year and the top earners earn less, our dear elites would still be receiving their nice pay package.

It is, however, the best time now to rise wages for our ‘super-elites’. Being elites educated in top universities, they very well know that with the phenomenal economic growth (which favors the capitalists aka the rich but at the expense of the low waged), even though inflation is at an all time high, delaying it any longer when inflation rate spirals out of control or recession in US pulling down the world’s economic growth and most importantly, as the election date nears, the government will not have a second chance to increase their wallet size from 50 inch to 50 feet.

The government keeps mentioning that there is a high rate of talents leaving the public service into the private sector. Ex-Minister Mr Cedric Foo is now cited often as a ‘quitter’ who had turned to the private sector (NOL as CFO) because of ‘higher wages’. Well, if a minister is only concern about his wallet, I do not want him to be my minister. I would be very much glad that he left (although he still retains his post as MP -- extra allowances from the government, so why not?). But is ‘low wage’ the real reason for them leaving? Many a times, it is not.

The private sector had always been perceived as a more dynamic and exciting place to work in. The problem lies more than pure cash. Can’t the government do up a simple Ishikawa Diagram to investigate the real reason for the ‘high’ turnover rate (turnover rate isn’t nearly as high as in banks). If the government keeps thinking that increasing wages will bring in talents and keep them loyal to the government service, then that is pure myopia. Buying ‘talents’ and loyalty with money, how long can this stance continue and how then can Singaporeans trust such money loving ‘super-elites’, who care about their wallet more than their willingness to serve the country, to manage the country? Greed knows no bounds and how much would be enough?

Then we come to the question of whether the ministers deserve the kind of pay package that they are having. Let us look at wage structures around the world. Wages compensate skills. The higher responsibility you have, the better skilled you are, the rarer your skills, the more you are compensated.

In terms of responsibility, any one of our ministers is managing a land mass and population size that is far less than any officials in the US or Britain or Japan or any other major first-world country you can think of. Yet, they earn far more than their over-worked counterparts. The government loves to argue that any of their ‘talented super-elite’ ministers and senior civil servants can earn more in the private sector. But is that so? A simple check with the corporate world CEOs, CFOs, COOs, CIOs, MDs shows that these top executives are seldom top scholars. This shows that the argument is flawed in the first place. But the government takes in ‘spotted talents’ when they are young and grooming them by giving out scholarships and sending them to elite universities and prepare nice career routes for them assuming that these book muggers are the top brains both in public service and private sector. How different is this system compared with the imperial examination system of ancient China? With the complexity in international responsibility some top executives are handling in certain companies, their share of responsibility may equal if not surpass that of some of the ministers or senior civil servants.

Next we talk about skills. Since the government says that the ministers and civil servants are top elites, we are not wrong then to say that they possess super-extra-ordinary brains right? But have they been able to solve problems like inflation, income disparity, social security, transportation (this bugs me the most) etc?

“Oh no, inflation is a natural thing to happen given higher oil prices and good economic growth. We can’t help it. Income disparity….we do not have a choice. It’s globalization’s fault. Social security? Look at Europe! It’s pulling the entire economy down! You want social security? Fine, you must earn little, work, prove to me that you are pitiful and beg me to give you assistance so that we can prevent moral hazard. In return, I give you a bit of monetary assistance capped at $290 a month. Transportation? Oh we can’t please everyone can we? We allow LTA to make all the decision on whether to intervene into the market or not. We are also pleased to announce that we are merciful and we forgave them for their stupid mistakes in constructing lame cyclist blocks at one end of the bridge but not at the other end rendering a cyclist paralyzed, or having the Nicole Highway Collapse, or allowing SMRT and SBS to prevent duplicating routes leading to commuters being compelled to take longer routes, or being complacent in not regulating the taxi industry only to react after furious Singaporeans write into the papers to show frustration on taxi touts and disappearing taxis.”

So it seems, their skills are not unique, nor are they better than other governments. And what is happening to the humongous S$1 billion (that is one followed by 9 zeros!!) sinking funds that the town councils are keeping? Instead of providing rebates to citizens, they want to invest! Is there a need to invest the funds? Those funds are not meant to invest! It only shows that they are collecting too much from us. Are they going to create a 3^rd investment arm after Temasek and GIC? There is too much principal-agent risk at our expense. Why are we still paying so much when they have more than 1 billion dollars in excess!! 1 billion is enough to provide a great deal of financial assistance for many years to come! Any losses are at our expense. Will any gains be shared with the public? I think that would be a resounding N-O-!!

There are seriously too many things going on wrong with the government. There is simply no counter-balance of control! A report a few months ago shows that there are no proper checks in place in many ministries. The current government aspires to be both the governing body and the opposition check. But how can that be possible? Can God be the Devil at the same time? Apparently, our dear elites think that they can be both.