New Remuneration Scheme comes with a price
Posted on January 8, 2012, Sunday
CIVIL servants stand to benefit more from the Public Service New Remuneration Scheme (SBPA) compared to the previous formula under the Malaysian Remuneration System (SSM).
The SBPA is actually a salary revision – long overdue as it may have been – and not an improvement to the salary and pension scheme for civil servants.
It was implemented after the Public Service Department (PSD) agreed to several demands from Cuepacs. These include performance targets for increment, lowering of the Exit Policy and a meeting with the Department every three months on details of the pay scale and grade improvements under the Scheme.
While Cuepacs will let civil servants decide whether or not to accept the Scheme, it has, nonetheless, assured them of its commitment to continue negotiating ‘problematic terms’ (under the Scheme) with the PSD even after they had signed up.
In a show of good faith, the PSD agreed to extend acceptance of the SBPA option to Jan 15 while the deadline for acceding to the new retirement age of 60 had expired at an earlier date. As a matter of fact, civil servants who opted for the Scheme before Jan 15 have been receiving a pay rise since Jan 1.
Before the Scheme was implemented, only those civil servants who surpassed 75 per cent in the Annual Performance Appraisal Report (LPNT) or performance evaluation were entitled to a raise while those scoring below 70 per cent would be evaluated by a panel and asked to leave if they failed to improve within six months.
However, following further PSD-Cuepacs negotiations, the ceiling was lowered. Scorers of over 65 per cent under LPNT will now get a pay hike while those failing to obtain 60 per cent will be shown the door.
According to Cuepacs, the cut of 10 per cent – from 75 to 65 – in the LPNT (on pay increases) is not a problem because only a mere 0.4 per cent failed to meet the requirement in 2010.
The PSD and Cuepacs deserve a pat on the back for heeding the Prime Minister’s call to avoid a long-drawn dispute on the implementation of the SBPA. As a result, the 1.4 million-strong civil service were able to enjoy a windfall of sorts on New Year’s Day.
There are, however, public concerns that before the final decision was taken, amendments rushed through during negotiations may not have adequately addressed the high price to be paid for salary upgrades via the SBPA.
Observers point out that the apparent improvements to the SBPA are actually concessions made to Cuepacs, requiring the marks for salary increase as per LPNT to be reduced from 75 per cent to 65 per cent.
The argument is that by agreeing to the amendments, the PSD has in essence opted to sacrifice the performance targets, predicated upon meritocracy and efficiency, just to make it easier for civil servants to qualify for salary increments. This begs the question as to whether the higher pay expenditure can be justified by the lowering of performance standards, especially in view of the government’s commitment to cut growing budget deficits.
Another bone of contention is the lowering of marks in the Exit Policy (affecting mainly non-performing civil servants) from 70 per cent to 60 per cent with the result that poor performance is allowed to drag on for 12 months from the proposed six months. This calls into question the rather odd rationale behind not only tolerating performance at just 60 per cent but also for as long as one year.
The civil service is often said to be not in synch with the demands of changing times. Some would argue that even though Cuepacs managed to secure SBPA concessions from the PSD, it has, nonetheless, missed the golden opportunity to raise public service standards by being soft on slackers at the expense of diligent civil servants.
However, the saving grace is the agreement to hold joint consultations every three months, during which, it is hoped, the question on raising public service standards will be given the priority it deserves. Instead of just focusing on hiking pay, these quarterly consultations will do well to drive home the point that more concessions and subsidies will not help the country achieve Vision 2020 goals.
It must be realised that unless productivity and efficiency levels improve in tandem with, or even better, rise above mounting costs from salary increments, the economy will be burdened with bigger budget deficits and greater debts.
Our economic progress – just like our security and defence – must never be compromised but sustained and protected come what may.