MINISTERS' salaries will rise from the current $1.2 million a year to $1.6 million by the end of 2007.
Announcing the revisions in a ministerial statement in Parliament, Defence Minister Teo Chee Hean - who's also minister in charge of the civil service - said this will put the salaries at 77 per cent of the private sector benchmark, up from the current 55 per cent.
Ministers and top Administrative Service officers now have their annual salaries benchmarked at two-thirds the median income of the top 48 earners across six private sector professions.
Based on this calculation, ministers' salaries should stand at $2.2 million, instead of the current $1.2 million.
To narrow this gap further, ministers' salaries will go up again from $1.6 million this year to $1.9 million - or 88 per cent of the benchmark - by the end of 2008.
Car allowance out, GDP bonus in
Mr Teo also announced that the car allowance for such appointment-holders, which now stands at 2.5 per cent of their pay, will be scrapped.
In its place, their salaries will be tied more closely to the performance of the economy via a GDP (Gross Domestic Product) bonus, as well as their individual performance via a performance bonus.
For example, if economic growth exceeds 5 per cent, such officers will receive 3 months bonus. If GDP growth hits 10 percent or more, they can expect to get up to 8 months bonus.
As for the individual performance bonus, this is expected to make up a bigger portion - from about 2 months a year now to 7 months.
From PM to retired officers to fresh grads
Prime Minister Lee Hsien Loong's annual salary, Mr Teo also revealed, will stand at $3.1 million after the new revisions. This will elevate Mr Lee from the 164th position among all income earners in Singapore now to 102nd.
Speaking to a packed House in a one-hour address, Mr Teo also had good news for the MPs themselves. Their monthly allowance will also go up from this month from $11,900 to $13,200.
Former office-holders, ex-MPs and civil service pensioners will also receive ex-gratia payments, while existing officers in the management executive scheme, management support scheme, the uniformed services and the foreign service can get up to an extra 1.5 months.
To attract new entrants, even starting salaries will go up from June. A fresh graduate with a good honours degree, for example, can look forward to a 10 percent jump in starting pay.
3-day debate in Parliament expected
The bottomline, Mr Teo explained, is that 'financial rewards' should not be the main motivation for people to join politics or the civil service. But neither should pay, he added, be the reason for them 'not to join us'.
Now that the long-awaited ministerial statement has been delivered, the House is expected to sit for 3 days until Wednesday, with many backbenchers - from the *** to Nominated MPs to opposition MPs - scheduled to speak on this highly emotive topic. The Front Bench themselves may well join in as well, before Mr Teo responds and wraps up the debate on the final day.