SINGAPORE — For the last five years, political office-holders here received an average national bonus of 4.1 months, Deputy Prime Minister Teo Chee Hean disclosed on Monday (Oct 1).

The national bonus is calculated based on national outcomes, such as employment and economic growth. Between 2013 and 2017, each year's payout ranged between 3.4 and 4.9 months, Mr Teo told Parliament in response to a question from Mr Alex Yam, Member of Parliament for Marsiling-Yew Tee Group Representation Constituency (GRC).

Among other things, Mr Yam asked if the Government could list the components of the incomes received by Prime Minister Lee Hsien Loong and other government ministers.

Mr Teo told the House that the ministers also received an average performance bonus of 4.3 months over the same five years, and this had ranged from three to six months each year.

Political office-holders received an annual variable component (AVC) of 1.3 months on average over that period, ranging between 0.95 and 1.5 months each year.

Saying that the Government has “always been transparent with the salary structure for political office-holders”, Mr Teo reiterated that the Workers’ Party (WP) had endorsed the principles governing the salary framework of ministers, as set out in a White Paper titled Salaries for a Capable and Committed Government, which was tabled and debated in Parliament in 2012.

The fixed component of a minister’s wage includes a monthly salary and a 13th-month non-pensionable annual allowance.

The variable components comprise a performance bonus, a national bonus, and the AVC as paid to civil servants.

Mr Teo stressed that all bonus components form part of — and do not come on top of — the norm of S$1.1 million that an entry-level minister receives.

“The salary structure is totally transparent. There are no hidden salary components or perks,” he said.

PM Lee’s variable salary — which does not have a performance bonus as no one assesses his performance — has twice the national bonus of other ministers, and it is linked to “national outcomes, in place of the individual performance bonus”.

As a norm, the prime minister’s total salary is twice that of an entry-level minister, at S$2.2 million, which includes the national bonus.

The national bonus is pegged to the four key national economic indicators: The real median-income growth rate, real growth rate of lowest 20th-percentile income, the unemployment rate, and the real gross domestic product growth rate.

In August, Emeritus Senior Minister Goh Chok Tong, who has not received a ministerial salary since he retired from Cabinet in 2011, set off a debate on ministerial salaries after the matter was raised at a community dialogue session.

Mr Goh had said that ministers were “not paid enough”, after a participant suggested that ministers’ salaries or the national defence budget be cut to better support senior citizens.

SHARP WORDS

The issue sparked a back-and-forth on Monday between Mr Teo and opposition Members of Parliament from the WP in Parliament.

In 2012, the WP had put forward a formula that would have computed the same total yearly salary for an entry-level minister, similar to what was recommended by the independent committee working on the White Paper.

“If there were a WP government in power today, by its own formula, the WP minister would be paid essentially the same as what a minister today is paid. Mr Pritam Singh would have paid himself that same amount,” Mr Teo said, referring to the WP secretary-general and Aljunied GRC MP.

WP’s Non-Constituency MP (NCMP) Leon Perera asked Mr Teo if the figure for the national bonus paid to ministers had been made public in the past.

Mr Teo said the information was published once, the year after the salary framework was announced in 2012, and the method for calculating the national bonus is “well-known”.

Mr Perera, who had submitted a written parliamentary question in early September on the bonus paid in the past five years to Cabinet ministers, also asked if the Government could have disclosed and published the national-bonus level then, in addition to the performance-bonus levels which was disclosed by Prime Minister Lee Hsien Loong in a written reply.

“He (Mr Perera) asked for what each minister gets,” Mr Teo responded.

“For the national bonus and AVC, it’s the same for all ministers… so if that was what Mr Leon Perera wanted, he could have filed an oral question and followed up, and we would have provided him the answer as we would today,” he added. “There’s nothing secret about it... I’m answering all the questions today.”

Turning the tables on Mr Perera, Mr Teo asked if he affirmed WP’s 2012 position that ministerial salaries should be transparent and competitive, and recognise the ethos of public service.

He also asked if Mr Perera agreed that the salary framework the WP had proposed in 2012 would essentially result in the same total annual income as the White Paper’s, save for the fact that the WP proposal had a much larger fixed-pay component (81 per cent).

The fixed component of the pay of ministers from the People's Action Party makes up 65 per cent of their total annual pay.

Mr Perera, who became an NCMP in 2015, said he was not present in the House during the 2012 debate, and was not suggesting how the total compensation or monthly salary should be calculated.

“Mr Perera should not evade the question. I’ve provided him with all the information there; it is there. Does he agree or not?” Mr Teo pressed.

Mr Perera replied that there were no grounds for him to disagree with what had been presented during the debate in 2012.

DEFENDING WP’S FORMULA

Stepping in, Mr Singh said the party agreed that Mr Teo’s point about WP’s proposal in 2012 resulting in a similar income as that of the White Paper was accurate. 

Though the result was similar, he stressed that the principle underlying the WP’s formula was to consider what would be a “fair multiple”. It settled on the MX9 senior civil-servant grade because the party felt an entry-level civil servant would aspire to that post.

In contrast, the formula proposed by the independent committee was to peg ministers’ salaries to 60 per cent of the median income of the top 1,000 income-earners.

Mr Singh also noted that Mr Teo had provided a range in his response on the bonuses paid, and asked if the Government could provide the “absolute dollar amount” instead.

Mr Singh questioned if the Government could have pre-empted some misinformation on ministerial pay that had occurred online “had a fuller and more expansive reply been given” to Mr Perera’s parliamentary question in September.

Government website Factually later put up a post to debunk the falsehood.

Mr Teo replied: “I’ve answered Mr Alex Yam’s question as he has posed it, and the most important aspect of that answer is that all the components are within the framework of the S$1.1 million (salary for entry-level ministers) that was put in place in 2012.”

Mr Singh then pointed to recent recommendations made by the Select Committee on Deliberate Online Falsehoods, of which he is a member.

He highlighted a recommendation, which states that public institutions should, wherever possible, provide information to the public in response to online falsehoods in a timely manner.

“They should also seek to pre-empt vulnerabilities and put out information in advance where appropriate to inoculate the public,” Mr Singh said.

“I would suggest to the DPM, if we put out the dollar value, the prospect of more misinformation can be reduced.”

Mr Teo replied: “I think Mr Pritam Singh is being slightly disingenuous. Mr Perera asked for some data, and the next day, the data was misinterpreted and became the widespread basis for false information.”

DPM TEO ADDRESSES ‘MISCONCEPTIONS’

The issue of ministerial salaries is a difficult and emotional subject where “there are misconceptions, sometimes deliberately propagated”, Mr Teo reiterated.

“It is easily politicised,” he said. “Even knowledgeable, well-meaning people who have a deep interest in politics can be susceptible to this.”

He singled out resort company Banyan Tree’s executive chairman Ho Kwon Ping, who had suggested in a recent interview with Channel NewsAsia that ministerial salaries be pegged to Singaporeans’ median salary, and setting up an independent commission to decide on the quantum.

“There was an independent committee — not one, but two,” Mr Teo pointed out.

“The independent committee did have an extensive consultation in 2012, and a significant part of ministers’ salaries are pegged not just to the growth of average salaries, but to the lowest 20th percentile of salaries and to unemployment rate — issues which are important to every Singaporean.”

Last year, Prime Minister Lee Hsien Loong formed another independent committee to review the salary framework for political office-holders, and it found the current salary structure remained “relevant and sound”, Mr Teo said.

He noted that even Mr Ho, who is “well-informed”, has “some serious misconceptions”, including how his salary was lower than that of ministers — when it was really higher.

Based on Banyan Tree Holdings’ 2017 Annual Report, Mr Ho earned more than S$2.6 million in annual income.

Mr Teo said that if uncorrected, this misrepresentation could have “been carried widely and spread more disinformation”.

“Ministers, for example, are responsible for tourism development or air transport — it’s just one of their many responsibilities which contribute to the growth of the tourism industry in our region, in which Mr Ho’s company operates,” he added.

Mr Teo said that even though ministerial pay is a difficult subject to talk about, the Government has to address it from time to time.

“Because we do need a fair, open, honest, transparent framework in place so that we can continue to have able, committed and passionate people with integrity come to serve as our political leaders.”

Asked for his response to Mr Teo’s remarks in Parliament, Mr Ho said it was unfortunate that the Channel NewsAsia interview had given an impression “which not only made me seem quite ignorant or untruthful about my own remuneration, but also critical of the amount of ministerial salaries”. 

“I was not ‘corrected’ by the interviewer — I was referring to basic salaries and she used my total compensation instead. Anyone in the corporate world will realise the two are quite different,” he explained.

Mr Ho stressed that he had never criticised the “absolute level of ministerial salaries” and “fully agree that their work is more important to the nation than my own business enterprise”.

“I have reservations about how they are computed and pegged,” he said.

“I have absolutely no reservations about their absolute amount, which I have always publicly argued is more than justified not only because of their contributions, but in order to ensure that the entire public sector… will never need to succumb to the open or hidden corruption in both developing or even very developed countries.”

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