South Africa’s ministers and deputy ministers – who draw salaries of between R2 million and R2.5 million a year – do not have to pay for water and electricity thanks to changes to the ministerial handbook earlier this year. This has caused a public outcry, with many lamenting the fact that taxpayers have to contribute to the private electricity and water bills for the very same ministers who have potentially robbed citizens of access to these critical services. But what if the ministers had no such perks and were forced to suffer like the rest of us? Ivo Vegter ponders this while proposing potential solutions to this problem, such as allowing their salaries to increase by the GDP growth rate every year, instead of by some inflation-plus formula, for instance. If average South Africans can’t afford fancy inverters, why should government officials – who can’t keep the lights on for their countrymen – find themselves better off? This article was first published on the Daily Friend. – Asime Nyide
Let cabinet ministers share our suffering
By Ivo Vegter*
It is high time to put cabinet ministers, senior government officials and legislators on a metaphorical diet. Let their pay be commensurate with, and directly dependent on, the welfare of the people they govern.
Senior government officials not only earn exorbitant salaries, but they can use unlimited electricity and water at no cost to themselves. Their official residences are exempt from loadshedding, and their second residences have generators paid for by taxpayers.
According to a report in Sunday’s City Press, the new ministerial handbook that came into effect in April exempts them from having to pay for any municipal services, and eliminates the previous R5 000 cap on water and lights bills that the Department of Public Works would pick up.
Meanwhile, the rest of us struggle to cope with water restrictions and the substantial expense of trying to keep work computers running during power outages, or trying to keep commercial and industrial businesses afloat amidst record-breaking blackouts.
The allowance for ministerial motor vehicles has also been raised from R700 000 to R800 000. BusinessTech has a nice gallery of some of the vehicles driven by our butter-bummed overlords.
These taxpayer-funded benefits come on top of exceedingly rich perks that include living rent-free in two government-owned mansions, private medical insurance, a generous pension plan, 88 flights per year, refund for the cost of commuting and travelling to and from airports, free parking at airports, relocation expenses, travel for dependants, VIP protection, cellphones, tablets and laptop computers, office equipment and furniture, stationery, personal accident insurance, plus a full 13th cheque.
Meanwhile, the rest of us struggle with record-high fuel prices, the highest price inflation rate in 15 years, and collapsing municipal services.
Millions upon millions
The total remuneration packages for top government officials are eye-wateringly high. The president earns R3,1 million per year. The deputy president is not far behind, on R2,9 million. Ministers and deputy ministers earn R2,5 million and R2,0 million a year.
Worse, besides the president and deputy president, there are a grand total of 27 ministers and 33 deputy ministers employed in South Africa’s executive branch, at a total annual remuneration of R133,5 million per year.
By contrast, the mean size of cabinets in European countries is 18, and the US has 21 cabinet members.
What’s more, South Africa’s executive is more highly paid than most. The British prime minister, for example, is entitled to a salary of £79 936, although she draws only £75 440 of that. (It appears to be customary for British senior government figures to draw less than what they’re entitled to. Imagine that happening in South Africa!)
£79 936 works out to just under R1,6 million, which in nominal terms is less than any of our cabinet ministers or their deputies earn.
It gets more interesting when you adjust this by purchasing power parity (PPP), which indicates how much that income can actually buy in each respective country. By PPP, £79 936 works out to a fraction less than R400 000. The British prime minister’s effective salary is substantially less than a municipal councillor earns in South Africa. Their entire salary package is worth half of a minister’s car allowance in South Africa.
Anti-poaching
One common justification for paying senior government officials’ exorbitant salaries is that they have to compete with top-end private-sector salaries, so they don’t get poached by big business.
This is obviously absurd. None of South Africa’s senior government officials would be hired in any executive capacity by any private sector firms. They might be able to swing an influence-peddling sinecure to keep cronyist tenders flowing, but CEO-material, they ain’t.
Since there is practically no risk of the private sector enticing them away from public service, there is also no need to match the fattest salaries paid by only the biggest companies to only their very top executives.
New pay formula
I’d like to propose an entirely different remuneration structure. Base the salaries of senior government officials on the average South African salary for non-farm workers of R294 936 per year.
Start municipal councillors at this ordinary middle-class salary, plus 50%. Give mayors and deputy ministers twice this salary, ministers 2,5 times the baseline, and the president three times the average pay cheque.
By all means, add the benefits necessary for them to do their jobs: issue them with laptops, car allowances, housing allowances if they’re required to maintain two residences, medical aid and pension benefits, but keep these benefits modest and middle-class, and in line with what a middle- to upper-management employee would get at a typical corporate business. That will make their lives more than tolerable.
If middle-class South Africans cannot afford fancy inverters, why should the government officials that couldn’t keep the lights on find themselves better off?
Contrary to their belief, their work is not more important than the work of people in the private sector. If it weren’t for the long-suffering private sector, they wouldn’t get paid at all.
There’s no need for a minister to drive a swanky 5-Series BMW through the townships, when a nice Ford EcoSport S or Mazda CX-3 or Toyota Corolla or Volkswagen Polo for R400 000 will do just fine.
Extra incentive
For extra incentive, let their salaries increase by the GDP growth rate every year, instead of by some inflation-plus formula. That will motivate them to keep GDP growth high and inflation low.
As for attracting talent, I would far rather be governed by a cabinet of competent managers who consider public service a noble calling and whose incentives are strongly aligned with the interests of the people they govern, than by a bunch of good-for-nothing fat cats whose only ambition is conspicuous wealth and whose only skill is looting the state.
Instead, the alarmingly heavy members of cabinet living in the lap of taxpayer-funded luxury turn around and spit in the faces of the people by exempting themselves from blackouts, and from rising water, electricity and fuel prices.
Let our suffering be their suffering, and let’s see how quickly South Africa’s problems get solved then.
- Ivo Vegter is a freelance journalist, columnist and speaker who loves debunking myths and misconceptions, and addresses topics from the perspective of individual liberty and free markets. Follow him on Twitter, @IvoVegter.
- The views of the writer are not necessarily the views of the Daily Friend or the IRR. If you like what you have just read, support the Daily Friend.
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