Government May Backpedal on Supplements Ban

A day after senior government officials met to discuss the contentious issue of salary supplements for civil servants, which were eliminated by a subdecree in early December, there were strong indications on Friday that the government could be reconsidering its all-out ban on donor-paid bonuses.

The ban, which came into force on Jan 1, has caused general outcry, with some international aid donors saying it could lead to a crisis in the public sector. Many civil servants bolster their low incomes with these supplements, which are intended to reward government workers who participate in key aid projects.

The subdecree jettisoned all supplements, including major pay reforms known as Merit-Based Performance Incentives and Priority Mission Groups. These supplements were standardized and funneled from the donors through the government, which also partly funded them.

Prak Sokhon, secretary of state at the Council of Ministers, said on Friday that the government would make some changes to the new policy.

“We will do some changes on the supplement allowance,” he said.

No decision about the salary supplements was set in stone, he added, but the government is still determined to eliminate MBPIs and PMGs.

Mr Sokhon declined to comment further on the issue, citing the internal nature of the meeting.

Several other sources said on Friday that the government was considering a partial rollback of the pay supplement ban because of its possible negative impacts on the livelihoods of civil service. The sources declined to be named because of the sensitivity of the issue.

One senior government worker said a superior told him that the outright ban on pay supplements might be reversed. The worker, who has himself received salary supplements since 2004, said he expected to see serious repercussions in his sector if the ban were to be implemented.

“I’ve learned from a Secretary of State who took part in the meeting that the situation might be changed,” he said.

“It means that the government is understanding that to eliminate salary supplements would have a serious negative impact on lower civil servants. So the planned elimination of salary supplements will be cancelled, as I was told by my superior who was at the meeting,” the official said.

Another senior civil servant said her salary supplement from a donor organization had helped keep her family’s head above water for years.

“Actually, it’s a great idea that the government is trying to reform for equity and salary fairness among civil servants,” she said. “But to be honest, my [government] salary is absolutely so small that it cannot easily support a family.”

“For myself, I have been treated well by salary supplements, so it would absolutely have a serious economic effect on my family if such bonuses were ended in the near future,” she added.

The civil servant said that the possible negative impacts of the ban had been widely but quietly discussed among other government officials since the plan was announced last month.

An NGO worker with knowledge of the situation also said on Friday that the government was considering a partial lift of the ban.

“There might be a possibility that the government may consider maintaining [some] salary supplements and incentive schemes, and saying that the subdecree only applies to the termination of MBPI/PMG,” he said.

Enforcing the ban on just MBPI/PMG supplements would make some fiscal sense, this source said, because the government helped fund these bonuses and was scheduled to pay an increasingly larger proportion of them over time.

In a Dec 4 letter to World Bank Country Director Annette Dixon explaining the decision to end the pay supplements, Finance Minister Keat Chhon said that financial concerns brought on by the global economic crisis were a key factor.

“The government wants the ability to respond to what the government’s ability is relating to finances-how much we have, how much we can spend,” Council of Ministers Spokesman Phay Siphan explained on Thursday.

But Mr Siphan emphasized that the ban on civil servant pay supplements was “not money-oriented, it’s principle-oriented.”

The MBPI/PMG scheme was developed over many years as a key civil service reform. It was meant to solve the worst problems associated with non-standardized, donor-funded supplements, which contributed to inequity within the civil service and made workers more accountable to donor institutions than the government.

“The merit-based pay incentives were a step forward from the ad hoc additional supplements that were previously given, because they were based on contracts,” said Sharon Wilkinson, country director for Care International.

“However,” she added, “they were not the full solution.”

“The full solution to managing public sector officials is to have systems in place that allow you to allocate staff to where they are needed in a timely manner, and pay them recompense which is in line with being able to survive. That is the public administration reform process.”


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