Range of Total Annual Compensation for Political Office Holders from 2018 to 2024

The current salary structure and compensation package for Political Office Holders was established by a review committee in 2012 and implemented from 2011, when the then-Government assumed its new term of office. The framework and salaries have not changed since. Although a subsequent committee was formed in 2017 to review the 2012 framework, the Government of the day decided not to make any changes to political salaries then as the economy then was undergoing transition.

Then, and remains the case today, the norm annual salary of an entry-level Minister is $1.1 million. This is based on a 40% discount to the market benchmark established in 2012.

The salary points for other political appointment holders are pegged as a fixed ratio to the entry-level Minister's norm salary level.

The annual salary is made up of fixed and variable pay components, split around 65:35 respectively. The fixed pay components comprise monthly salary and 13th month Non-Pensionable Annual Allowance and make up 65% of the total annual salary. The variable pay is made up of the National Bonus, Annual Variable Component and individual Performance Bonus, which together make up about 35% of the total annual salary.

The National Bonus is determined equally by four indicators related to the socioeconomic progress of Singaporeans as laid out in the White Paper: namely, the real median income growth rate of Singaporeans; the real growth rate of the lowest 20th percentile income of Singaporeans; the unemployment rate of Singaporeans; and the real GDP growth rate. No National Bonus is paid if the targets are not met. Three months of bonus will be paid if the targets are met, or up to six months if targets are far exceeded.

The Annual Variable Component is the same amount that all Civil Servants receive. Between 2018 and 2024, it ranged between zero and 1.5 months.

The individual Performance Bonus may range from zero to six months each year, as determined by the Prime Minister.

All the components added up – fixed pay plus variable pay, including any and all bonuses – make up the norm level of $1.1 million for an entry level MR4 Minister.

The Member asked how the salaries have tracked against household income. As the issue at hand relates to salaries of individual political office holders, a more appropriate comparison would be with individual incomes.

While political salaries have not changed since the 2012 review, based on the Ministry of Manpower's published data, incomes of Singapore Citizen earners at the 20th percentile and median have conversely increased by 87% and 80% respectively within the same time period.

The Government has recently appointed an independent committee to recommend appropriate salaries and propose refinements to the framework. It will submit its report to the Government when it is ready, after which we will provide an update to Parliament.