CNA Explains: How Singapore reviews and benchmarks political salaries

Singapore’s political salary framework is set for discussion in parliament, with Prime Minister Lawrence Wong and Coordinating Minister for Public Services Chan Chun Sing scheduled to deliver the government’s response.

An independent committee reviews political salaries once every five years. However, pay for ministers and parliamentarians has not changed since 2011. The last review, completed in 2017, resulted in a decision not to implement changes, while a review planned for 2023 was deferred because of prevailing global circumstances.

The framework covers the president, prime minister, parliamentary speaker and deputy speaker, members of parliament, non-constituency MPs, nominated MPs and political appointment holders. It combines fixed and variable components: 13 months of fixed pay, an annual variable component typically worth one month, an individual performance bonus of three months for good performance, and a national bonus of three months if targets are met. A political appointment holder could therefore receive 20 months of salary when all conditions are met.

The benchmark for an entry-level minister uses the median income of the top 1,000 Singaporean income earners. The framework applies a 40 percent discount to reflect the sacrifice associated with political service. An entry-level minister holds the MR4 grade, with possible progression to MR3, MR2 and MR1.

An MR4 minister may start at S$46,750 a month, equivalent to S$935,000 annually, including fixed pay of S$607,750. At the benchmark level, the monthly salary is S$55,000, or S$1.1 million annually, including S$715,000 in fixed pay. The national bonus uses four equally weighted indicators: real median income growth, real income growth among the lowest 20 percent of earners, Singaporean unemployment and real GDP growth. The prime minister earns twice the MR4 ministerial salary, or S$2.2 million, and receives a bonus based only on the national bonus because no one determines the prime minister’s performance bonus.