Tuesday, May 22, 2007

Pay Day for Civil Service

It's a good and welcome move by the Government to increase the pay of the civil service between 7.5% and 42% from July 1st, as announced yesterday by the Prime Minister. It is the first pay rise since 1992.

In addition, it's a good move to provide an additional 20% pay increase to police and army personnel on top of the above increments. It was difficult to believe that a constable in the police force currently draws a meagre RM690, an amount that barely on par with the poverty line in Peninsula Malaysia.

The salary raise however, accentuates another major unresolved problem within the our civil service sector. The civil service has been expanding rapidly since the 1990s, and the growth accelerated under the current prime minister. In 1990, the Federal Government had 773,997 employees; by the year 2000, there were 894,788 on the payroll, a significant increase of 15.6%. However, since then, the civil service employment has accelerated by another 210,000 personnel, marking a 23.5% increase over the past 6 years alone.

The increase in civil service has come about despite the massive privatisation exercises conducted over the past 20 years to reduce the economic burden of the Government as well as to increase the efficiency of the delivery system. One of the key objectives under the privatisation programmes launched by the then prime minister, Tun Dr Mahathir Mohamad, was to reduce the civil service population to just above 500,000. Hence, it could be verily argued that the privatisation exercise by the Government was a failure in maintaining a lean and efficient government for the civil service is today more than double its intended size.

The unwieldy civil service we have today has, in a large part, to do with the Government's policy of making our civil service the dumping ground for the politically sensitive constituency of unemployed Malay graduates. For example, last year alone, the Public Services Department (PSD) and Public Services Commission have been urged to speed up the recruitment of graduates to fill some 30,000 vacancies in the civil service. This call was made by the Deputy Prime Minister Datuk Seri Najib Tun Razak to overcome the problem of unemployed graduates, of which an overwhelming majority was bumiputeras.

By absorbing these graduates who were not able to obtain gainful employment in the private sector, it results not only in a poor quality workforce within the civil service, it also increases the Government's financial obligations.

Hence, one of the unnecessarily negative impact of the very necessary increase in the civil service pay is the massive RM8.0 billion financial commitment for the current and future years. Despite the record RM159.4 billion budget for 2007 as announced last year, the RM4.0 billion civil service pay increase for the 2nd half of this year was not previously budgeted, raising questions if the targeted deficit of 3.4% of GDP for 2007 can still be achieved. The RM8.0 billion increase also marks a permanent 7.1% increase on the Government's annual operating expenditure.

The Government must hence take the painful but very important step of trimming the civil service sector into a leaner and more efficient “machine”. The increase in pay will be a waste of public funds, if the move is not accompanied by a corresponding increase in civil service productivity. The Chief Secretary to the Government, Tan Sri Mohd Sidek Hassan, must wield the stick to ensure the “shape up or ship out” culture which he promised to deliver earlier this year. He cannot let his words be mere rhetoric, or it'll just enhance the perception that the Government emphasizes only on rhetoric and not deeds.

Finally, it is also hoped that the Government will make additional adjustments, just like that for the Police Force, for the teaching sector as well as critical professionals such as doctors. Additional adjustments for teachers in primary and secondary schools as well as lecturers in local universities will serve to attract better and more qualified candidates into the teaching profession. This is critical in achieving the country's mission to build human capital as part of its key pillars to achieving our Vision 2020. The adjustments will certainly make for a more meaningful teachers' day which was celebrated just last week.

As for doctors, they are certainly one of the most poorly paid medical professionals in the region, resulting in many qualified Malaysian doctors seeking greener pastures overseas where they are in demand. At the same time, this compromises our healthcare system with sub-standard doctors recruited from many Third World countries.

It is hoped that the Government will pay heed to the above constructive criticisms and take urgent and imperative steps to make the pay rise for the civil service a truly meaningful one for Malaysian citizens, and not just a one-off pre-election handout.

(This above post was also sent out as a statement to the press. It has been carried in Malaysiakini here and here)

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