The Public Service Division (PSD) has announced on Thursday (Jun 18) that civil servants in Singapore will not receive a mid-year bonus this year due to “unprecedented economic crisis” brought about by COVID-19.
The last time there was no mid-year bonus for civil servants in the country was in 2009, during the global financial crisis, Channel News Asia reports.
In a press release, PSD added that Public officers in “superscale grades” will also take either a one-time pay cut of half or one month depending on their seniority. This comes after senior public service officers in key leadership positions took a half-month pay cut, which was announced in February.
According to a written reply to a parliamentary question in November 2018, Trade and Industry Minister Chan Chun Sing said superscale officers comprise about 1.9 percent of the civil service. The monthly salary for senior management superscale officers starts from about S$11,000, he added.
“The Public Service stands in solidarity with the rest of the nation during this difficult period,” said PSD. “Against the backdrop of a worsening economic outlook, and in close consultation with the public sector unions, the Government has decided that there will not be any mid-year annual variable component (AVC) payment to civil servants this year.”
PSD said the measures take into consideration the recommendations of the National Wages Council, which in March called on employers and employees to do their part, with management taking the lead, in helping to reduce costs and save jobs.
“The Government appreciates the hard work and sacrifices of public officers in the fight against COVID-19, including those working on the frontline and behind the scenes,” said PSD. It added that many have gone beyond their call of duty to take on additional or expanded roles to support workers, businesses, and fellow Singaporeans in “weathering the economic uncertainties and adjusting to the new normal”.
Government agencies will make different efforts to appreciate and recognise the good work of officers, said PSD. In deciding on the year-end bonus payments later this year, the Government will take into consideration the National Wages Council’s recommendations to give special consideration for lower-wage workers, PSD said.
“The COVID-19 pandemic has taken an unprecedented toll on the economic situation both externally and domestically,” said PSD.
Based on the latest estimates, Singapore’s gross domestic product is expected to shrink between 4 percent and 7 percent this year, down from the previous projected range of a contraction between 1 percent and 4 percent, the Ministry of Trade and Industry said last month.
The labour market is also weakening, added PSD, with total employment (excluding foreign domestic workers) for the first quarter this year contracting sharply. PSD said resident and citizen unemployment rates continued to rise in March 2020, while retrenchments rose over the first quarter of this year.
POSSIBLE YEAR-END BONUS IF ECONOMY IMPROVES: CHAN CHUN SING
If the economic situation improves at the end of the year, a “year-end AVC payment” may be considered, especially for lower-wage workers, said Mr Chan in an internal note.
“We will also recognise your significant contributions through performance bonus,” he said, adding that he is thankful for the hard work and dedication of all public service officers.
In the note, Mr Chan acknowledged that it is a “very difficult time for our nation”.
“Let us focus on the important task of restoring our economy. How we recover from this crisis depends on the choices we make – as a Government, and as a people,” he said. “I am confident that we will emerge stronger if we overcome this crisis together, and continue to thrive for many generations to come,” he added.
UNION LEADERS RESPOND
In response to the announcement, the National Trades Union Congress (NTUC) said it supports PSD’s decision.
“In such difficult times, we also recognise the efforts of senior leadership in public service who are taking the lead and a deeper cut in cost reduction,” Ms Cham Hui Fong, deputy secretary-general of NTUC said on Thursday.
“We are cognisant of the current testing situation where economic uncertainties, stalled business outlook and looming job losses are on most Singaporeans’ minds.
“While the worst may have yet to come, we must let the safe reopening of our economy, reinvigorating of our businesses, preserving of jobs and training of our workers take precedence.”
The Amalgamated Union of Public Employees noted that it was a “necessary” decision.
“Public officers and agencies have stepped up greatly through various roles in helping to contain the spread of COVID-19,” said Mr Sanjeev Kumar Tiwari, general secretary of the union.
“However, it is necessary to stand in solidarity with the rest of the nation in coping with this difficult time – the decision for no mid-year AVC for public officers is a necessary one.”
The Amalgamated Union of Public Daily Rated Workers added that it understands the “grave situation” Singapore is in, with businesses facing losses and closures, and workers worried about their jobs.
“We applaud the Government for the swift implementation of various initiatives and financial measures for businesses, workers and Singaporeans to tide through these troubling times,” said Mr Raman Kathavarayan, general secretary of the union said.
“Should the our economy improve by end of this year, I sincerely hope that government could provide an additional monetary supplement for our low wage employees working in the public sector as they have borne the deeper brunt of the pandemic.”
According to PSD’s website, the public service is one of the largest employers in Singapore, hiring about 146,000 public officers. Within the public service is the civil service, which comprises about 85,000 officers working in the ministries and organs of state.