That thorny issue of parliamentary salaries
What we pay, or rather should pay, our ministers and members of parliament has always been a hot potato — too hot to handle and therefore deprived of rational discussion. It is virtually impossible to avoid the perception of politicians feathering their own nests.
Various attempts have been made to establish a framework to deal with this issue in a way that is reasonable, taking into account the weight of responsibilities attached to these positions, and palatable to the public, bearing in mind their own circumstances that, at least in part, are affected by those who hold these positions.
Committees and committees
Over the last 50 years, four committees, all headed by eminent private sector individuals — Leslie Ashenheim (1973), Ronald Sasso (1981), Douglas Fletcher (1989), and Oliver Clarke (2003) — laid out proposals for treating with parliamentary salaries. In addition, there was a special parliamentary committee chaired by then Finance Minister Dr Omar Davies, in 2005. In each case, some of the recommendations were adopted, some rejected outright, and others simply ignored.
The current framework is based on a recommendation from one of those earlier committees that a minister’s basic salary should be one dollar more than that of a permanent secretary. An “appropriate” differential was then established between that of a minister and the prime minister as well as ministers of state, parliamentary secretaries, the speaker, the leader of the opposition and members of parliament.
For a long time during the fiscal strain of the 1990s, while permanent secretaries and other public sector workers received periodic salary increases, no commensurate adjustment was made to the salary of ministers and, hence, none to that of the other political office holders. This was corrected in 2003 when parliamentarians received a 103 per cent increase to restore the “one dollar more” relationship between ministers and permanent secretaries. It caused a howl of protest from the public, including public sector unions, with scant regard for the fact that parliamentarians had been left stranded for many years when public sector salaries were being increased.
In dealing with the issue, a comparison with other countries is not very helpful. In Jamaican dollar equivalency, the United States pays its president $56 million and the UK, Canada, and Australia pay their prime ministers $32 million, $26 million and $19 million, respectively. Our prime minister receives a total package of around $13 million. But their per capita GDP is eight to 10 times ours. On the other hand, Guatemala and Kenya, whose per capita GDP is less than ours, pay their presidents the equivalent of J$34 million and J$23 million, respectively.
Criteria for setting salaries
The Clarke Committee proposed in 2003 that the indexing of parliamentary salaries to those of public sector workers be discontinued and that they be computed based on specific performance targets such as the differential in inflation between Jamaica and its main trading partners and how well MPs tend to their constituencies.
At first glance, this approach is appealing. How it would be computed in dollar or percentage terms, however, is mind-twisting. In addition, it is inherently irrational and unfair. Inflation is not caused only by fiscal misbehaviour. It may be driven by external factors over which ministers have little control. Oil price shocks may have a far more negative effect on inflation in Jamaica than they do in our main trading partner countries. Are ministers to be blamed and punished for that? How is the performance of members of parliament in servicing their constituencies to be measured when so much of that function is dependent on Government decisions and resources over which they have little or no control?
Relativity
The linking of the salaries of parliamentarians to those of public sector workers does make sense. They are both working in the same enterprise with the same conditions and constraints and for the purpose of serving the same clients. A survey carried out by the Inter-Parliamentary Union in 2013 found this to be the practice in 55 per cent of the countries examined.
However, the current arrangement is a misalignment. Fixing the salary of a minister at a dollar more than that of the permanent secretary boasts no logic and is flawed by any comparative analysis. It is almost impossible to find any organisation in which the person at the head receives the same salary as that of the most senior executives who report to him or her.
It becomes more awkward when one examines the relationship between the remuneration of ministers and that of the heads of other government agencies who are answerable to them. The salary packages of the governor of the Bank of Jamaica and the heads of the Port Authority, National Housing Trust, Petroleum Corporation and Tourist Board — to name just a few — are two to three times that of the prime minister, not to mention the ministers to whom they report.
The current salary package of a member of parliament is about $70,000 per week. That is equivalent to what a mid-level executive in the civil service earns and about what a supervisor in a large private sector establishment is paid.
Given the nature of their responsibilities — both in the legislature and at the constituency level — it would have been more appropriate to peg the salary of members of parliament to that of the permanent secretary. Theirs is not a nine-to-five, five-day-week job. They do not enjoy the security of tenure that career permanent secretaries enjoy or the gratuity and compensation for premature termination to which contracted permanent secretaries are entitled.
I subscribe to the view that parliamentary salary increases should be kept in line with those of public sector workers. During my time in office, the decision was taken, given the multiplicity of bargaining units, that these adjustments should be based on the weighted average of public sector wage increases. The thinking was that we should not do for ourselves more than what we are able to do for those whose salaries we also determine. As far as I know, that policy has been maintained.
Reclassification
It seems to me that what needs to be done is to establish the salary scales for the different parliamentary positions, taking into account the levels that obtain within both the civil service and the other Government agencies. In civil service jargon it is called reclassification. Periodic adjustments would then be made in line with the weighted average for the entire public sector inclusive of the statutory entities.
— Bruce Golding is a former prime minister of Jamaica