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Question of salaries

Monday 20th February 2006

In making recommendations for salary increases in its 80th Report, the Salaries Review Commission (SRC) applied five main criteria to its deliberations. The first was "fair comparison with current levels of remuneration paid within the private sector"; the second was a level of remuneration to attract persons with suitable competence and personal attributes for public office; the third was to ensure that there were "appropriate differentials" between different offices according to the levels of responsibility; the fourth was to provide motivation; and the fifth was to provide packages that would "promote the efficient delivery of public policies and public management solutions."

By these criteria, the SRC recommends that the Prime Minister’s salary should be increased from $32,000 a month to $48,000, while Cabinet Ministers’ salaries should rise from $22,000 to $33,000. The Leader of the Opposition’s salary should be raised from $17,000 to $23,000, and Senate members’ salaries should be increased from $7,500 to 10,500. In all these cases, perks such as housing and travel allowances and so on are also to be increased.

There is an interesting cultural difference between the SRC’s perspective and that of its equivalent body in Britain, the nation which created the Westminster model our government system is based on. In Britain, the primary criteria is to provide salaries at a level which allows holders of public office to live in a simple but respectable fashion. Our SRC, by contrast, emphasises "the need to maintain meaningful differentials or relativities with top positions and supporting positions under the SRC and the rest of the public service."

The problem with the SRC’s criteria is that the assumptions behind them are not necessarily correct. Does giving people in public office more money result in greater efficiency? The record of the Public Service would not seem to bear this out. Do better compensation packages help ensure integrity? Perhaps — but, even though the courts still have to decide their cases, it is worth observing that ministers from the past and present regimes who are facing fraud charges are men with personal wealth. Also, the problems in the Public Service have more to do with deficient systems and cultural attitudes — issues which greater compensation packages would impact on only minimally or not at all.

But the most contentious criterion is the SRC’s assertion that Ministerial compensation packages should bear some relation to private sector salaries. This might be fine if ministers were subject to the similar performance standards as the private sector. But this is not the case and, unless it becomes so, such a criterion cannot be considered reasonable. Also contentious would be the SRC’s estimate of compensation as linked to responsibilities, since this criterion is to some extent political. Salary increases can be justified for the Director of Public Prosecutions, the Commissioner of Police, the Chief Magistrate, and even the chairmen of the Teaching Service Commission and the Environmental Commission. But can the same be said for the chairmen of the Police Service Commission, and the Integrity Commission, and ambassadors?

The SRC also linked these increases to the economy, noting that Gross Domestic Product had increased by seven percent. But, in the same breath, it also noted that the cost of living had gone up by 20 percent. Should persons in public office be rewarded for that kind of mismanagement? Additionally, if the SRC is using economics to justify the level of recommended increases, why has it not noted the Central Bank’s warning about stagnation in the non-energy sector, with Governor Ewart Williams pointing to a deficit in this area of 13 percent of GDP? We also wonder if, when GDP falls, the SRC will recommend decreases in salaries across the board.

We doubt it. After all, part of the SRC’s report also recommends increases for the chairman and the four members of the Salaries Review Commission.

Trinidad and Tobago News

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