For some reason or another, it went into my head to search around for the elusive formula which is used by our government to peg their salaries to the private sector.
This is what I've found out from PSD:
- For the benchmark data, only earnings of Singapore citizens, Singapore Permanent Residents, and Malaysians working in Singapore are included.
- The benchmarks are based on Principal Earned Income which has been taxed. These consist of earnings from the individual’s primary source of employment and include monthly salaries, bonuses, stock options, partnershipfees and commissions. Unearned and passive forms of income, such as dividends, rent and interest, are excluded.
- Stock options are included in the salaries of the top income earners. However, the gains from stock options vested each year are discounted by 50%. This means we only take half of the stock option gains in the current year, as current year income. This is because the amount of stock options are usually accumulated over a few years, and the gains may be quite large. Taking the total gains would cause incomes to escalate, and is not a good reflection of the actual earnings.
In fact, according to PSD in end 2007, these are the following base monthly salaries:
- President: $119,520
- Prime Minister: $115,920
- Minister/Senior Permanent Secretary: $59,760
- Entry Superscale Grade: $18,240
- Member of Parliament: $13,710
Using the example of the prime minister, his base annual salary will be less than $1.4million, not the floated $3.87 million, which will be his salary + whatever bonuses.
Now the million dollar question is... Which pay got cut? The base? Or just the bonuses? What other extras are there in the salary?
Sometimes I do not understand why the government like to shoot themselves in their own foot.
6 comments:
Hi, i'm a little bit confused but i wan to learn more about the Pay Issue thus i hope u can assist to enlighten me.
1) Prime Minister: $115,920
So how did it become $3.87m?
2) Principal Earned Income.
Is this the Gross Income before Tax + bonuses, 50% stock options, partnershipfees and commissions?
Hi, i'm a little bit confused but i wan to learn more about the Pay Issue thus i hope u can assist to enlighten me.
1) Prime Minister: $115,920
So how did it become $3.87m?
2) Principal Earned Income.
Is this the Gross Income before Tax + bonuses, 50% stock options, partnershipfees and commissions?
Whoever came up with this benchmark formula must have the same idea as Chen Shui Bian which is to enrich oneself by pegging to some other high achiever's salaries!
To put it in another way, it is just another way of corruption except that it is done in the legal way.
These are also the answers that I've been trying to find out. However, I'm unable to find any shred of information in the PSD website that provides any explanation to the make-up of the salary.
The only information that I can find of their bonuses is:
1) It includes the GDP and performance bonus.
2) The official car used by the President and the Prime Minister is a taxable benefit and subjected to tax. How this adds up to the annual salary is a mystery.
3) GDP bonus is between 0 to 8 months depending on Singapore's economic growth. One thing to note is that they will get 0% only if the economic growth is <= 2%. Otherwise, they get 3 months bonus which is their norm.
4) Performance bonus norm is changed to 7 months. This is decided by the PM.
So that means, a minister in Singapore can get a total of 15months bonus.
For the principal earned income, what I can gather is that it is the income which has been taxed, so I presume it's the amount before taxed.
tat's a lot of money. cutting back by half won't hurt anyone >_<
So krazy
Mmm...
Doesnf matter
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