1/19/2012

An arbitrary salary package based on judgement call

The ministerial salary recommendation was passed after three days of debate. Though there were some attempts to take issues with the recommendation on grounds of principles and methodology, eventually all was convinced that there was really nothing to discuss as it was a judgement call. And there was elation when a common number was found and a hurry to move on with no regards to how it is derived. The only agreement was that there is a need to pay well to attract the right calibre of candidates for the important position of ministers.

Though I have been away from the human resource industry for a while, I cannot help but to see a reluctance to really do a thorough proposal based on what should be the relevant factors and inputs to come out with a less subjective recommendation. The main flaws in the recommendation are the insistence on the use of top income earners and the refusal to use comparative salary of politicians of other countries. The latter was pooh pooh away by raising a few strawmen as justifications, that because of these flimsy excuses, comparing them would be unsatisfactory. I will come back to this later.

Why the preoccupation with the top 1000 income earners and how relevant is this? The perceived intrinsic bias to use these high numbers is that the salary will have a higher base to start with and thus self serving. The cynics would not be happy for many obvious reasons. The PAP’s argument to favour this selective pick of the top 1000 is that the potential candidates should come from this pool of people, apparently logical but not really.

I will just point out two fallacies from this assumption. One, top money earners are not necessary top political leadership material. Political leadership means many more important things than just about ability to make money from any means or profession. The second point is that top income earners are likely to be so wealthy that they would not be distracted by a few million dollars, plus or minus. Money is not really an issue to attract them as they have plenty of them. And this is well pointed out earlier by another MP.

Money is only important to the talents that are not making that kind of money, and wanted to earn more, or near to what these people are making. The disconnect between this logic and the target group is pretty obvious. It is a flawed argument, a flawed basis to work on.

The second point I want to make is the quick dismissal of using foreign political leaders for comparison. Why? The often quoted reasons are related to corruption and tangible and intangible perks or benefits. As far as benefits are concerned, it is easy to find out and easy to quantified. For people who shoot freely about Air Force One or about trying to pay peanuts, these are foolish arguments that should not be entertained as quoting them showed that they are not serious. Second home allowance or travelling allowances of UK politicians are only relevant to them as the country is big and it is costly to travel from Scotland to London for Parliament sittings. Armoured plated cars for Obama is not a benefit but a necessity as his head has a big price. When mentioning benefits, one must be serious and not spurious just to win an argument.

All the perks can be tabled and the compensation specialists can review them for their relevance. This is something very lacking in the whole process. The dismissal of inputs from the compensation experts and every Tom, Dick and Harry thinks that designing compensation packages is about commonsense and anyone can do it. Maybe they are right if it all boils down to judgement call. The taxi driver too can come up with a set of numbers.

Some benefits are specific and unique in nature and are simply inappropriate for consideration. Whatever perks that are official are obtainable and can be monetised in some ways. Intangible perks may be a problem if relevant. Getting a proper list of all the perks for consideration cannot be a difficult task for such an important matter.

The corruption part is more tricky but not unsurmountable either. We are talking about developed countries and not lawless dictatorships which should not even be part of the equation. Under table payouts cannot be considered as morally they are wrong and illegal. No sensible govt will dare to quote corruption as something that must be paid in a country that is incorruptible and makes corruption illegal.

Then again there are ways to by pass such issues of morality by creating a corruption index to help the incumbents from being corrupt. Of course this kind of thinking would not be tolerable to many. Assuming that it can be bulldozed through, then make a provision for it by calling it under whatever terms, or make a judgement call.

What I find disturbing is that there was no serious attempt to use the salary and perks of foreign political leaders for comparison when this is the most logical thing to do. All the exceptions and differences, in terms of size, economy, population, land mass, uniqueness etc can be moderated or massaged, with different weightages attached, to make them meaningful.

By brushing aside the most appropriate source of comparison and plunging into something that is really of no relevance to political leadership makes the recommendation and approval by Parliament a bit rancid and distasteful. Quite disappointing really, when the top and bestest talents were involved to challenge the recommendation or supporting it. At the end of three days, hook, line and sinkers were all swallowed in one big gulp and everyone seems so please, and with a sense of great achievement.

Where are the inputs from the human resource and compensation specialists?

23 comments:

lim said...

How to pay the Minister. If you ask a citizen to do national service and re-service and pay them $90 during my time, nobody complaint as it is duty to serve the country.

Now we have a PAP saying that we should pay the highest and I already give you a discount, every logical argument also cannot swallow. Try to explain it to man on the street and they wonder how they are satisfy with the already 1 million salary. The best from LHL, cannot fired the minister, must do it discreetly, slowly put them into less stress job and retire them. If you fire them openly, nobody want to join. Wow, then we should not let SMRT CEO retire, should move her to SIA and slowly retire..... ha ha ha. Want to compare to private sector and don't want to risk!!!!!

Look like we have elected Panda that cannot survive in the real world.

Anonymous said...

Yah lor, foreign political leaders hold the top post for only two terms and they will have to give up their airforce 1, white house, buckingham palace, armoured vehicle and all that.

As for them earning hundreds of thousands from giving talks whilst in office, who is stopping Sin political leaders from it?

In my simple understanding of living, there is only one word to describe our leaders. They are SINfully greedy.

patriot

Anonymous said...

Dear redbean
I'm surprised that you sound surprised & disappointed.

First of all, you are absolutely correct in your points.
a)compensation experts should have been used. We use foreign flood & train experts. So why not foreign compensation experts?

b)Only the brain dead PAP groupies cannot see that foreign political leaders should also be included in the salary benchmarking process.

Grace Fu wants to complain about loss of personal privacy? Try the USA Presidency where an assassin's bullet will interrupt personal privacy at any time.
That PAP even thinks they can compare PAP politicians' job demands with the USA Presidency just goes to show the depth of delusion and group-think.

Bottom line
------------
This is all about cherry-picking the basis for salary.

And to do for the sake of doing Singapore style.

We the unconvinced remain unconvinced. For me it boils down to a simple "I no longer believe & trust people dressed in white uniforms."

For the brain dead PAP groupies, this salary review is just a refresher course on the reasons they should support the Ministers' pay.

Nothing's changed.
GE 2016.
Game on.

Chua Chin Leng aka redbean said...

Though the ethos in parliament has improved and with less giggling and rhetorics, the approach is still the same. You cannot have a real discourse to come up with a better solution in Parliament. It is a battle field with both sides wanting to win an argument at all cost and not how good is the recommendation or how to make it better.

As such you will have nonsensical points thrown up which may sound good at the moment but with a little careful thought were mostly rubbish.

Matilah_Singapura said...

I said from the beginning EVERYTHING in this affair is ARBITRARY. And that it was smoke and mirrors wayang. And didn't I also allude to the opposition being just another bunch of pollies? Why should they oppose the pay? One day, if/ when they win, they'll get the BIG BUX too.

Move on lah. You can't fight CULTURE. Hi pay = Hi value. That's a deeply embedded CULTURAL BELIEF. Don't believe me?

Singaporean when they "data mine" in relationships almost ALWAYS want to know:

1. How much you earn
2. How much you're worth

Sometimes #2 is determined later. The determination of #1 is attempted very early in the game. You can call it kay poh, and it is. But it is a cultural artifact. The MORE you earn the BETTER you are.

The way people act collectively is a reflection of CULTURE. Therefore, the people get the expensive government they deserve

Chua Chin Leng aka redbean said...

I have never seen Matilah sounding so sober and human before: )

Anonymous said...

He is wise and worldly!

Matilah_Singapura said...

Post something controversial lah. Get my steam up. Then I show you, ok? Mahu ka tidak mahu?

Anonymous said...

A big wet blanket at the end of the whole exercise. token reduction of 8% across the board. Just like $8 bypass surgery. 8 seems to be a recurring number for these Pappies.

Anonymous said...

Time to "move on" , no more show to see liowze.

Anonymous said...

So, think b4 you screw him
or send him hate mails. He
is jus a pragmatic materialist
or realist. No sin at all to be
one. When he spouts wisdom, only
Redbean is comparable.
When he talks nonsense, there
are many better than him and
by a big margin.

Chua Chin Leng aka redbean said...

People who are obsessive and comfortable with obscene salaries also suffer from Tourette Syndrome.

Anonymous said...

5 more fat years of milking the cow before Salaries get reviewed. What a brilliant move , dangle the carrot again before the next election. Next election , better have CPF issue as one of the topics up for discussion at Parliament. This time round , no more clowning around... limpeh coming up to retirement age soon, need to get my CPF back in lump sum horrr..

Anonymous said...

WTF seah , See Fatt Face said :"we have made real progress " .... seriously what the phuck is this guy spewing ???? There is a serious disconnect here. The unhappiness regarding the inflated pay persists and he says real progress has been made ? What kind of joke of a debate was that in the parliament? 一面倒 and wrapped up by pinky and the issue is done and dusted for the the next 5 years?? seawiously , what the phucccck ??

Anonymous said...

Another point of agreement is a clean and transparent salary. Is this just talk or would they put it into practice?

It was mentioned that only 2 ministers received 8 to 10 months bonus in 2007. Apparently no one got paid more than this in year 2008, 2009, 2010. Or no bonus was paid in those years. Please confirm.

Anonymous said...

Dear Matilah.
For once I'm in total agreement with you on this.

"The MORE you earn the BETTER you are."

This is the Singapore value system.

Don't know whether to blame PAP or to blame ourselves.

But certainly PAP's behaviour encourages this sort of value system.

Chua Chin Leng aka redbean said...

Now the govt has a salary approval certificate from Parliament, approved and supported by the opposition MPs and with the chop of Mercer to wave around.

Fully legal, legitimate and professionally designed by a HR professional agency.

Chua Chin Leng aka redbean said...

Just wondering what was the brief given to Mercer and how much did Mercer contribute to the final product?

Anonymous said...

In one parliamentary sitting we have made enemies of all the world leaders by calling them corrupt. Only our leaders are not corrupt because they pay themselves with clean wage.

Don't worry all the world leaders will not be offended because their hands are in the cookie jars.

Anonymous said...

When Gerald Giam was asked if he knew what was MX9, he should asked if the minister know how many months of bonus he himself received last year and care to tell the house.

Anonymous said...

Kudos to Gerald Giam
for his gallant effort.
He showed conviction.

patriot

Anonymous said...

The salary package is NOT arbitrary but based on the below logic (spotted from the web). In the fist place, it is a fraud.

The logic of politicians’ remuneration:

You propose a formula for your own salary and present the proposal to the parliament for approval. You and your cronies have total control of the parliament. You know your proposal is definitely passed without meaningful debate.

You propose salary formula for you and your cronies to base on a group of top earners who are mostly from GLCs and your cronies' companies. You also know that your controlled parliament will pass your proposed formula. Next thing you do is to get GLCs and your cronies' companies to pay the chief very very well. As such, your and your cronies' salary will be increased accordingly.

After the people object to your proposal, you appoint one of your cronies to review the proposal and he recommend a revised proposal that you and your cronies (not the people) are happy about it. Then you present the revised proposal to the parliament again for approval. You know that all your cronies in the parliament will support the revised proposal because the revised proposal is for their own good. The parliament is still dominant by your cronies and the revised proposal will be approved without any question. 


After the revised salary proposal is done, one of your cronies can say she suffer pay cut by joining politics. She claimed she could earn much more in 'private' sector. Look at what 'private' sector she has worked before joining politics. She has worked for few GLCs before invited to join politics. Are GLCs really 'private' sector? If she is right, those GLCs must have paid her very very high salary. This proves that if you have raised the GLCs chief salary this will actually effect higher salary for you and your cronies. 



By controlling the corruption at lower levels, foreigners who do not know the details of this system will believe that a pro-business governance system is free of corruption. Is the system really corruption-free?

Based on the logic, it proves that the current system is very very clever to ‘legalize’ corruption at the highest level. If not, what is it?

You may look at the logics of GRC, NCMP and NMP. It is not difficult to understand the ultimate motive behind a fake democratic ‘feudal dynasty’ politics in action in a modern world.

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