Public servants to get 3% pay rise next year to boost morale

TAIPEI, Taiwan, The China Post Staff and Agencies

Premier Yu Shyi-kun yesterday approved a 3 percent pay raise for all civil servants, military personnel and public school teachers starting in January next year, according to Cabinet spokesman Chen Chi-mai. Chen said the premier endorsed the recommendation made by the Central Personnel Administration (CPA) and the Civil Servants Salary Adjustment Screening Committee (CSSASC) in a bid to lift the morale of government employees. Lee Yi-yang, director-general of the CPA, said CSSASC commissioners held a meeting to discuss the pay raise issue earlier in the day. The CPA proposed four options — no raise or hikes of 1.5 percent, 2 percent or 3 percent — for the CSSASC to evaluate.

“After an hour-long meeting, CSSASC members unanimously agreed to the option with the highest hike of 3 percent,” Lee said.

The proposal would be referred to the Cabinet for formal approval.

Lee said both President Chen Shui-bian and Premier Yu have already thrown their support behind the 3 percent proposal with a view to boosting the morale of all public servants.

The government has not adjusted salaries for civil servants, military personnel and public school teachers for three years.

According to Lee, the proposed pay raise will cost the national coffers an additional NT$18 billion annually. Despite this financial cost, Lee said the government will overcome all difficulties to realize the pay raise plan.

Lee said the CPA has referred to several positive factors in formulating the 3 percent pay raise proposal.

The economic growth rate is projected to reach 5.41 percent for this year, the per capita gross national product (GNP) expected to reach US$13,651, an estimated 0.8 percent inflation rate, and an average 2.13 percent salary hike in the private sector between January and May this year.

About 730,000 civil servants, military servicemen and public school teachers will benefit from the pay raise plan.

Premier Yu was the first senior officials to reveal the pay hike plan, breaking the news during a radio interview in the morning. He said the planned pay raise has nothing to do with the legislative elections four months later. Yu’s ruling Democratic Progressive Party and its ally aim to capture more than half of the legislative seats. “The plan is part of the government’s efforts to retain competent officials for public service and thus enhance the nation’s overall competitiveness in the world market,” Yu explained.

At the moment, Yu said, a government agency chief’s monthly salary is about NT$170,000, far lower than the pay earned by a senior business executive in the private sector.

“Should this trend continue, the government will have a hard time retaining experienced technocrats and recruiting young professionals for public service,” Yu said.

Asked whether the proposed pay raise could induce the business sector to follow suit and thus fuel domestic inflation, Yu said the government will make a prudent study of the impact and adopt necessary complementary measures.

In the past few years, some business and industry leaders called for cautious consideration of pay hikes for government employees. They feared that pay raises will increase the overall labor costs in Taiwan and weaken the island’s export competitiveness.