Budget 2011: Higher pay for civil servants this year

SINGAPORE : The strong economic performance of 2010 will translate into higher pay for civil servants this year.

Minister-in-Charge of the Civil Service, Teo Chee Hean, told Parliament on Wednesday that annual salaries will return to levels before the downturn in 2008.

Senior officers will also get the maximum GDP Bonus this year, with some getting as much as eight months' pay.

Singapore's impressive recovery last year was soon followed by a tightening labour market.

The civil service was also affected, with resignation rates rising from 3.5 per cent in 2009 to 4.7 per cent in 2010.

Among officers in the Management Executive Service, the attrition rate went up as high as 17 per cent among younger graduate officers.

Deputy PM Teo outlined the need for competitive wages, and said the civil service is restoring the cuts made during the downtown.

Together with the Special Variable Payment of one to 1.6 months to be paid out in March to those who clocked in a good performance, the annual salaries of public officers will, on the whole, return to pre-recession levels.

The annual salaries of senior civil servants are automatically linked to GDP growth. This is because they contain a significant variable portion, which is dependent on both the officer's performance as well as economic growth.

"GDP Bonus is zero if GDP growth is two per cent or below, but accounts for a maximum of one-quarter of the annual salary of senior officers, or eight months, when the GDP growth exceeds 10 per cent," said DPM Teo.

In 2010, Singapore posted a GDP growth of 14.5 per cent.

After two years of not getting the GDP Bonus, which had amounted to a 18 to 22.5 per cent reduction in their annual salaries, senior officers will get the maximum rate this year.

"Nevertheless I should emphasis their total annual salaries, including all the variable components, remain within the market benchmarks, and that was the way the salary structure was designed," said Mr Teo.

Mr Teo said the policy was for civil service pay to keep pace with, but not lead, market salaries.

On Monday, opposition MP Low Thia Khiang had noted in Parliament that estimated salaries for political appointments had gone up about 30 per cent, from $58.3 million in 2010 to $75.7 million in 2011.

Mr Teo said this reflected the design of their pay structure.

He added that no changes had been made since salaries were revised in 2007.

- CNA /ls