Bureaucrats will cost us P2.2 billion a day

Senate President Pro-Tempore Ralph Recto revealed that next year, taxpayers will be paying government officials and employees P2.2 billion a day. If you think that’s too much for the quality of service we get, Malacañang has also hinted P-Noy will be giving them a raise at our expense before he steps down.

There is nothing wrong with paying our civil servants right. It is just that hints for the pay increase dropped by Budget Secretary Butch Abad, made just as P-Noy endorsed Mar Roxas, sounds like in aid of election.

Sen. Recto estimates there are one and a half million permanent positions in the national government plantilla. He correctly points out that because of the large number of government employees, “when we plan any increase in pay, we should be mindful that any increase in the salaries of government workers will be shouldered by their employers – the people.”

The senator said the cost of government salaries plus military pensioners and veterans is now at P746 billion. This will rise to P810.8 billion next year as proposed in the budget. In 2010, it was P457.6 billion.

Oh well… it is true some government workers need better pay. But I agree with Senator Recto that any pay hike should prioritize teachers, policemen, firemen and soldiers, as they do the most useful and often thankless jobs in government requiring them to risk their lives.

Sen. Recto: “Ito yung Police Officer 1, Teacher 1, Firemen 1. They’re mostly clustered around the Salary Grade 11 to 13 brackets. They get a basic monthly pay of between P18,549 to P21,436. These are the people who are in need of a salary hike,” he said.

Theoretically, the highest end of the government salary grade is that of the President who gets P120,000 a month. At the other end of the spectrum is the P9,000 monthly salary of a Salary Grade 1, Step 1 holder, the entry-level post in government.

Government pay is reputed to be totally unattractive to qualified people who can earn multiples of that in the private sector. The President for instance, seems to be working for peanuts.

A simple manager in a leading company would easily earn more than what the country’s chief executive does. Yet, politicians spend over P5 billion to win a presidential election.

Then again, there are exceptions to low government pay. COA reported that many government officials earn a lot more than the President and the Vice President who both officially earn only P1.4 million a year.

Philippine Ambassador to China Erlinda Basilio was named the highest paid last year with P16.439 million. On the other hand, Consul General to Saipan Medardo Macaraig ranked 100th with salaries and other benefits amounting to P5.3 million.

Supreme Court Justice Presbitero Velasco was the highest paid member of the judiciary, taking home a total of P6.2 million, while Chief Justice Maria Lourdes Sereno received P4.6 million in total compensation. Out of the P4.6 million the Chief Justice received last year, P1.6 million was in the form of allowances, while P1.3 million was her discretionary fund.

Indeed, the bulk of the justices’ huge compensation is in the form of allowances. Their basic annual pay is P1.1 million, except for Sereno, who gets P100,000 more in basic salary. Justices, however, get allowances from the Presidential, Senate and House Electorial Tribunals whether or not they do any work.

Of course, the President’s compensation includes free board and lodging plus security and expensive foreign junkets. The Vice President has his own Coconut Palace and the budget to keep that office going even if the functions of the office are not well defined.

All the fringe benefits of being President aside, our President earns in dollar terms, only $31,000 a year. It doesn’t seem commensurate to the headaches our President has to bear.

The low pay, plus the high cost of being elected to the position is likely one of the factors at the root of our problems. A capable person elected president with no independent financial means will likely be compromised to vested interests who funded his expensive campaign. On the other hand, presidents from the elite, most specially the haciendero class are already compromised to protect their class interest.

I prefer the Singapore system of paying their officials commensurate to what their skills and responsibility will pay in the private sector. That seems like a question of affordability, but the pay cap of what we pay our officials is in practice, largely theoretical.

Singapore’s Prime Minister Lee Hsien Loong earns about $1.7 M per year, the highest annual salary earner among country leaders. Lee was earning even more until his salary was cut following public unhappiness. He was earning more than $2.8 M from 2008 to 2012.

US President Barack Obama earns $400,000 per year, followed by Canadian Prime Minister Stephen Harper and German Chancellor Angela Merkel with annual salaries of $260,000 and $234,400, respectively.

India’s Narendra Modi and China’s Xi Jinping earn the least among prominent world leaders, with salaries below $50,000 per year. So it seems P-Noy’s $31,000 isn’t too bad. But it means GSIS general manager Robert Vergara who made P12.57 million or about $280,000 is overpaid.

There are those who are scandalized that seven officials in the Department of Foreign Affiars are among the highest paid government officials. I want to look at that in context. The figure likely includes allowances and house rentals. It looks like an atrocious amount in pesos, but when computed in dollar or euro terms, may be just enough to properly represent our country abroad.

I am more interested in the output of the ambassadors. I am not scandalized that Ambassador Basilio is getting over P16 million to represent us in Beijing. I am more concerned it doesn’t seem she has delivered enough to justify the expense, given the state of our relations with China.

I am not shocked that Vergara is getting that much to run GSIS because a good fund manager of his experience should be getting even more. I am concerned that BSP Gov Say Tetangco is getting only P9.8 million compared to Vergara’s P12.57 million. Gov. Tetangco’s responsibility is a lot greater than Vergara’s and Gov Say’s performance is absolutely world class.

Compensation issues are never simple. The late President John Kennedy was said to have just taken a token one dollar in pay. But he has a family fortune to lean on. Many of our presidents, P-Noy included, probably donate their pay check to charities for the same reason.

Indeed, working in government no longer seems such a sacrifice as Vergara’s example shows. The compensation package of the head of Pagcor is surely not leading him to the poor house, either.

All the allowances tucked in to the compensation packages of Cabinet members and the justices of the Supreme Court, Court of Appeals and the Sandiganbayan don’t seem to put them in danger of starvation.

There is more sense in being forthright in what exactly their compensation packages are for greater transparency… and also to ensure proper income taxes are paid. We seem to be encouraging our esteemed justices to be less than honest getting allowances from electoral tribunals that do little or no work. Just ask Mar Roxas about his protest.

Sen. Recto is right to call our attention to the need to come up with a study on our government compensation system. But the real problem is that many look at government as the employer of last resort.

We all know about the 15-30 jobs that politicians lavish on their supporters. I realize it is almost impossible to stop the practice, but there has to be more effort to do that.

The Civil Service Commission should also make sure all the positions are needed. Promotions and bonuses must be based on an honest performance appraisal. Our officials must show they respect the taxpayers who foot their compensation packages.

There must be a regular review to weed out government agencies and positions that are no longer needed. This is how we can get the resources to hire more of those we need most like teachers and policemen.

There is a need to upgrade the government pay structure to attract more qualified people. They must not feel it is such a sacrifice to work in government. But the taxpayers must also be compensated with good public service, something absent in many government offices, specially those front line agencies in most contact with the citizens.

Hopefully, Congress thinks of all these factors when they debate the national budget. I am glad Sen. Recto brought up the need to review the numbers and not just sign off on what the Budget department presented. But I know I am hoping too much, specially in an election year.

Boo Chanco’s e-mail address is [email protected]. Follow him on Twitter @boochanco