PM Wong explains salary changes, will continue to assess Ministers & adjust salaries based on performance

In accepting a committee's recommendations to adjust political salaries, Prime Minister Lawrence Wong said on Sep. 8 that they will not move immediately to the new salary benchmarks.

Instead, they will make a one-off adjustment now of up to 9 per cent for political officeholders.

PM Wong explained that the same increase will not automatically apply to everyone, as it will depend on individual circumstances, including performance and when their salary was last adjusted.

Ministerial grade

PM Wong also explained how salaries are calculated for ministers.

Currently, there are four ministerial grades – MR4, 3, 2 and 1.

For each grade, there is a range of salary points, which determine the minister’s fixed pay, he said.

PM Wong will decide the grade of each minister, including where each minister is positioned within the salary range for that grade and the individual performance bonus each year.

At present, 10 out of 16 ministers are at MR4 while the other six are at higher grades, reflecting their seniority and heavier responsibilities, including those serving as Coordinating Ministers.

Ministers can move to different salary points over time within each grade, based on performance.

Variable components such as the National Bonus and individual performance also make up more than one-third of a minister’s annual remuneration.

As such, the actual remuneration received by an individual minister in any year can therefore be higher or lower than the reference salary, depending on his or her salary point and the variable payouts, PM Wong said.

New recommendations

The independent committee has since recommended some fine-tuning to the current structure, PM Wong said.

There will now be three ministerial grades instead of four, with MR2 and MR3 combined.

The salary range for each grade will also be widened to plus or minus 25 per cent, he said.

PM Wong said they agreed with these changes, but the basic approach to assessing and differentiating individual salaries will remain the same.

After the one-off special adjustment, he will continue to assess ministers and adjust their salaries in the usual way, based on performance, he said.

"On that basis, by the end of this term of government, I expect most Ministers who remain at MR4 to be at the lower end of the new salary range – and that's about S$1.35 million," he said.

Those who excel and take on larger responsibilities may move higher within the range, or be promoted to a higher ministerial grade.

The same approach will apply to the other officeholders – Ministers of State, Parliamentary Secretaries and Mayors.

Bringing in capable people

The revised structure gives the PM more room to differentiate pay according to performance, PM Wong said.

Importantly, the structure is also to bring in people with substantial experience from outside government, especially those already earning significantly more in the private sector, he said.

"We will still expect them to make a meaningful sacrifice to enter political service. But we should not make that gap larger than it needs to be," he said.

"Good government did not come naturally to Singapore. It was built deliberately over many years. And there is nothing automatic about sustaining it," PM Wong said, noting that Singaporeans have benefited from a government that is able to plan ahead, take difficult decisions and deliver for more than 60 years.