A tale of two Jamaica’s — Part 2
You get what you pay for
Iempathise with the immediate pushback on the salaries for parliamentarians, permanent secretaries, the governor general, members of the electoral commission, et al, especially against the background of a minimum wage earner receiving $676,000 per annum.
Perhaps the increases should also have been structured over a more extended period to make it more agreeable for the public to accept. But the government has worked with the same pay scale for 37 years. Therefore, if the argument is to change the pay for parliamentarians, you must change the pay for all government workers.
If this is the case, we must ask what is fair pay for the work carried out by a Member of Parliament (MP) relative to the other salaries in Government and the Jamaican economy.
There will always be data that can support a person’s position. For example, regarding Jamaica, some journalists and other groups have referenced the salary increases for Jamaican government officials against the background of our gross domestic product (GDP), suggesting that they are being grossly overpaid.
When comparing the salaries of individuals they have very little to do with a country’s GDP or the size of a company someone is employed to. Instead, wages are directly related to the overall marketplace and the relative importance of the job function within the particular organisation.
On October 24, 2021, in this column, I wrote an article on performance-based salaries for MPS entitled ‘You get what you pay for’, citing the need to increase the salary of MPS for them to pursue their job functions and that they were earning less than minimum wage in the United States.
For full disclosure, I have been an MP since 2007. After government taxes and the PNP subtracting its mandatory 10% from my gross pay, my net monthly salary is $257,110.40.
Singapore is the envy of every developing nation, having moved its per capita income in 1960 from US$400 per annum to over US$72,000 today, ranking them eighth in the world above the United States. It is the country often referenced as the model of governance to follow.
Lee Kuan Yew, the recognised founder of’ ‘New Singapore’, attributes his country’s success to decisive leadership with the intense implementation of policies to drive education, meritocracy, integrity, and export earnings.
Singapore has no natural resources and a population of only 6 million people. Yet its exports are US$733.77 billion per annum compared to Jamaica. With a population of 3 million, our best year of exports was US$5.99 billion in 2019, less than 1 per cent of Singapore.
This should highlight my often-repeated statement that Jamaica cannot prosper by selling to only 3 million people; we must have value-added exports starting with agriculture. But I still see people with short-sighted vision continuing to focus our agriculture inward rather than towards export.
Singapore pays its prime minister $230,000,000 annually, more than five times the president of the United States, with less than two per cent of their population. The Singaporean prime minister firmly believes that competitive ministerial pay in Singapore is a critical factor in eradicating corruption in the country. In Singapore, a minister of government earns $109 million annually. For them, the benchmark salary for an entry-level minister is based on the median income of the top 1,000 Singaporean earners with a “40 per cent discount to reflect the ethos of political service”, according to the public service division website.
Closer to home, in 2009, the salary of the Barbadian Prime Minister was $16 million per annum — the population of Barbados 280,000; less than the size of Portmore.
So what is the salary of the top 1.000 earners in Jamaica?
Let us begin with lawyers, several of whom charge $60,000 (US$400) per hour. Within a 40-hour workweek they can earn up to $2.4 million weekly or $124 million annually. Specialist doctors earn within the same bracket or more.
According to their published annual reports, leaders within corporate Jamaica earn between $25 million to $100 million annually.
The salaries of the heads of government executive agencies, for example, National Housing Trust, The Port Authority, and HEART/NSTA Trust earn $31 million, $30.9 million, and $17.6 million, respectively. All these heads of agencies report to the prime minister, whose salary is $9 million.
A deeper analysis of the pay scale of the public service reveals the following:
(1) The payment of salaries to the public sector workers increased from $224 billion to $318 billion, an increase of 42 per cent.
(2) The impact of the salary increases represents 5 per cent of the total tax collections moving from 37 per cent to 42 per cent.
(3) The entire government staff of approximately 100,000 people were the beneficiaries of these allocations, which at 5 per cent have not put undue strain on the Jamaican budget.
It is worth noting that the prime minister’s salary increase represented 0.0061 per cent of the total salary budget. While the Cabinet ministers increase represents 0.0804 per cent, permanent secretaries are 0.0482 per cent, and the MPS are 0.1518 per cent.
The overall salary increase of the management personnel of the country represents 0.29 per cent of the total salary budget. Can this be considered excessive?
Every organisation has a pay scale. The Government is no different and has a pay scale for each worker category similar to positions in the private sector. Based on the current pay scales, MPS would now be paid similarly to a high school principal. Bearing in mind that a principal has the security of tenure, holidays, and designated school working hours, while an MP does not. An MP has to reapply for their job every five years.
As I said in October 2021, if we genuinely seek to move our country forward to one Jamaica, instead of two, we must demand more from elected officials and top civil servants. Therefore, we must attract the best talent by requiring minimum entry requirements commensurate with market conditions and job expectations.
It is time we accept the age-old adage, “You get what you pay for,” or else the annual constituency debate will continue to applaud road construction, care package distribution, and Constituency Development Fund (CDF) benefits without actual development of our country and increasing the per capita income of our people.