Tuesday, November 30, 2010
Tuesday, November 09, 2010
Lessons in Power, Ethics and Accountability
Below is an essay I've written for our "Power, Ethics and Accountability" course at the Ateneo School of Government which constitutes our mid-term exam.
“Reflections on Ethical Leadership and Good Governance Reforms”
By Oliver M. Mendoza
Introduction
The last two months taking up the module “Power, Ethics and Accountability” at the Ateneo School of Government has been quite interesting and intellectually stimulating for me. Our professor, former CSC Chair and DSWD Secretary Corazon Alma de Leon, has a novel approach to teaching. Perhaps knowing that actual life experiences would have more impact on us students than any theoretical discussion or classroom lecture, Professor de Leon would invite resource speakers to do a lecture in our class every Saturday. So far we have had Rose Yengko, a noted psychologist, Lucy Lazo, the former TESDA head, Mrs. Sonia Roco, who spoke about her late husband Senator Raul Roco, Miss Ava Cariquez, an Atenean who spent 11 years in the Correctional facility for women, and Willy Parayno, the former Bureau of Customs chief. Our class also had fun with the Starship presentation, a thought-provoking group exercise which required us to use our imagination and creativity in establishing a new social order in a distant planet.
A Nation of Free Spirits and Positive Thinkers
One of our first resource speakers was Dr. Rose Yengko, a noted clinical psychologist, who presented her “Nine Archetypes of the Filipino Psyche” paper. Miss Yengko postulated that 100,000 years of shared human experiences have brought about common personality traits (which she termed as “archetypes”) in certain groups of people. These so-called “archetypes” greatly influence how we view our world, our attitudes and behavior. She identified nine archetypes that characterize our people, namely: the Filipino is an “Artist,” “Navigator/Wanderer,” “Tribal Person,” “Warrior-Protector,” “Healer,” “Mystic,” “Islander,” “Reveller” and lastly, a “Child of Eden.” Each of the nine archetypes exists in each one of us, albeit in varying degrees of intensity and influence.
Dr. Yengko’s characterization of the Filipino as a “Tribal Person” explains why our leaders are so parochial and why majority of our population cannot seem to see the “big picture.” The “Navigator-Wanderer” archetype depicts the Filipino as a migratory people, adventurous and restless spirits forever looking for the proverbial greener pasture. This partly explains why we have the OFW phenomenon, which apparently has been going on for hundreds of years. But of all the nine Filipino archetypes, the one that struck me as most insightful was Dr. Yengko’s characterization of the Filipino as a “Child of Eden.” It is said that the Philippines before the Spaniards came was 97% covered with tropical rain forests – a real “Garden of Eden” on Earth. Thus, the pre-historic Filipino did not have to work hard to have something to eat since nature provided him ample bounty. This probably explains why Filipinos developed a happy-go-lucky, “bahala na” attitude towards life. Worrying about the future is not in our genetic make up, and Filipinos in general are optimistic. We somehow expect good things to happen to us.
Today our country is no longer a paradise and yet we continue to carry on as if we are still living back when the Philippines was a Garden of Eden. Our forests are long gone and our seas are over-fished, and yet we continue to consume without thinking of leaving something for future generations. Our people seem incapable of saving for the proverbial rainy day. Indeed various studies have shown that the Philippines has one of the lowest bank savings ratios per population in Asia. Our political leaders lack the ability to plan long-term and despite the fact that our country is regularly visited by typhoons, we always seem to be caught flat-footed and unprepared for calamities. But despite all of the seemingly hopeless problems we are facing today, we have retained our sunny disposition. In fact, in their 2009 survey the Happy Planet Index ranked the Philippines as the “14th Happiest Country on Earth” (with a rating of 59%). According to the survey, Filipinos were found to be happier than people living in more economically-developed countries like Sweden (48%), Japan (43.3%) and the United States (30.7%).
The “Child of Eden” syndrome is really both our boon and bane. It is a bane because it makes us easy to please, easy to forgive and easy to forget. It is a boon because our sunny disposition has helped us weather the countless storms that life has to offer. Foreigners often marvel at the Filipino’s capacity to smile even when they are in the direst of straits. I myself have often wondered how a “tambay,” a teenaged mother of three or a scavenger at the Payatas dumpsite can still appear so cheerful despite their poor prospects in life. I guess we just cannot help it – we simply are cheerful people. It’s part of our genetic make up. Alan Greenspan, the celebrated U.S. Federal Reserve chairman, would call this sort of behaviour “irrational exuberance.” We Filipinos call it “mababaw ang kaligayahan.”
On the Prerequisites of Good Governance and Ethical Leadership
Dr. Yengko’s “Nine Archetypes of the Filipino Psyche” gives us a useful insight into the underlying psychological foundations of our culture. Understanding the culture is vital to the success of any reform program because governments exist within a larger cultural framework. Any reform initiative that is incongruent with our culture will most likely fail.
It has often been said that graft and corruption has become part and parcel of Filipino culture. It has become so imbedded in our culture that it is virtually impossible to root it out. Miss Lucy Lazo, Mr. Willy Parayno and the late Senator Raul Roco attempted to root out graft and corruption in their respective agencies. Lazo abolished the Artist Record Book as a prerequisite for the employment of our Overseas Performance Artists (OPAs) to Japan after discovering that it was a major source of corruption at TESDA. Mr. Parayno relied on Information Technology (IT) to curb the rampant corruption in the Bureau of Customs. Secretary Roco gave principals greater autonomy in managing their schools. He also broke the “cycle of indebtedness” among public school teachers by making sure that teachers’ salaries arrive on time and by entering into a loan restructuring agreement with GSIS.
I was quite privileged of having worked for Roco for more than six years in the Senate and I can proudly say that I have yet to meet a man to match his personal integrity. Although I do not know Lazo and Parayno personally, I am quite convinced that they too are exemplary individuals with strong moral compasses and keen ethical senses. Roco, Parayno and Lazo were among the best, most qualified people ever to serve in government and yet, while they succeeded in curbing corruption during their watch, it became “business as usual” in their agencies soon after they were gone. It is also small comfort to learn that reformers in this country are not rewarded but punished for their efforts. On his first day at DepEd, Secretary Roco was mobbed by the teachers and most of the career staff adored and admired him. A year later they all hated him for disallowing their “overtime” pay. During lunch breaks a number of them would even stage a mini-rally in front of the flagpole to condemn Roco’s “unfair” and “dictatorial” policies. Eventually, Roco failed in his campaign for the presidency. Lazo wanted to save young girls from ending up as prostitutes in Japan, but she was loudly condemned by the very people she wanted to “save.” For his efforts Parayno was slapped with a number of graft cases in the Sandiganbayan, a couple of which continue to “pester” him to this day. While Roco, Lazo and Parayno were unsuccessful in stemming the tide of corruption, there are nonetheless several very valuable lessons to be derived from their experiences.
First, a leader cannot succeed if he does not enjoy the full support of his boss. After the tumult caused by the Artist Record Book issue, Lazo was booted out as Director General of TESDA and “kicked upstairs” to become Undersecretary of DOLE. She eventually left government service altogether for a more lucrative and “less demanding” job in the private sector. Parayno disclosed that one of the main reasons why he was so successful in Customs was because he got the full backing of his boss, then President Fidel Ramos. He revealed that each time he felt discouraged and ready to resign from his post, President Ramos would summon him to Malacanang to give him a “pep talk.” He would then return to Customs reassured and “refreshed.” Roco resigned from DepEd after the Presidential Anti-Graft Commission (PAGC) filed trumped-up corruption charges against him. He was then perceived to be a strong contender for the presidency and the graft case (which was eventually dismissed) was lodged mainly to sully his sterling name. In the case of Roco and Lazo, both failed because of lack of support from the top. Parayno’s case was the complete opposite. He was successful because he was perceived to be “untouchable” and enjoyed the full backing of Malacanang.
Second, a leader has to set the standard. Roco, Parayno and Lazo were successful in curbing corruption in their respective agencies because they had spotless records and did not partake in the shenanigans in government. Underlings look to their higher-ups for cues and the general public really look up to their leaders to set the example. Filipinos will be “good” if their leaders are “good,” but if their leaders are “bad” the people feel they have a justification to also become “bad.” It is rather child-like, but it is our nature. Parayno probably described it best when he said that ours is a “follow-the-leader” culture.
Third, reform cannot be rushed. It takes time and also requires the right “timing.” Lazo encountered great resistance, from within and without TESDA, after she arbitrarily abolished the Artist Record Book. Stakeholders complained that they were not properly consulted and clamored for the President to fire her from TESDA. At the time of his death Raul Roco was eulogized as “the best president our country never had.” But, in the words of Professor de Leon, Roco may have been ready for the Filipino but the Filipino maybe was not yet ready for him. In other words, his timing was not right. In his best-selling book “The Tipping Point: How Little Things Can Make a Big Difference,” Malcolm Gladwell wrote that people must first “want” change before any real, long-lasting change could occur. Gladwell cited the case of New York City which in the 1970s and 1980s was widely considered to be a dangerous and decadent place. By the 1990s New Yorkers decided they’ve had enough and in 1993 elected Rudy Giuliani as their mayor. During his first term Giuliani streamlined City Hall (he fired 12,000 “redundant” employees in his first term alone) and downsized the budget for social welfare (from 1,112,490 in 1993 the city’s welfare rolls decreased to only 497,113 in 1998). He then focused on police reform and law enforcement, starting with the highly-publicized arrest of 180 “squeegee men” (for jaywalking) who have been pestering and menacing commuters in New York. Much of the credit for turning New York City around has been given to Mayor Giuliani. But in his autobiography entitled “Leadership,” he said that he couldn’t have succeeded in imposing his “iron-fisted” policies if the people of New York did not want it in the first place. Rudy Giuliani saw himself more as the “right man at the right time” and pundits observe that if he had ran for office in the 1970s and 1980s, back when racial assimilation, affirmative action and social welfare policies enjoyed immense popularity, the electorate would have probably dismissed him as a “fascist” and a “racist.” But by the 1990s the mood of the people of New York has shifted towards conservatism and Giuliani became a “rallying point” of the people’s cry for change. Thus, a good leader must not only have the “balls” but more importantly an ability of knowing when the time is ripe for the particular reform.
We were taught that today’s ideal of leadership is that of the “leader-servant.” We were also taught that good governance involves the following elements: it is participatory, accountable, consensus-oriented, transparent, follows the rule of law, is responsive, effective and efficient, equitable and inclusive. But if you examine closely, you will realize that most of the abovementioned concepts are alien to our culture. Take for example the concepts of the “leader-servant” and “accountability,” which theorists define as “the obligation to explain publicly policies, programs and decisions of government.” These concepts are Western in origin and are not really inherent to our political culture. Our electoral system is not exactly conducive to creating an environment which makes our government officials “servants” who are accountable to the people. A politician who spends millions to get elected definitely will not see himself as a “servant” and will not feel accountable to the people. A career public servant, who gets admitted into the Civil Service thru his own merit and rise thru his own diligence, will not exactly feel indebted to the people. The “leader-as-servant” concept is contrary to the Filipino model of leadership of the strong and decisive individual reminiscent of the “man-on-horseback” mold. We look up to our leaders to “lead” – to set the tone, set the goals, the over-all strategy, etc. – and I have serious doubts whether a leader whose management style is “consensus-oriented” and “participatory” will become an effective manager in the Philippine setting.
We were also told that government should be “responsive, effective and efficient.” But government is structured as a bureaucracy and bureaucracies, as the term connotes, are inherently inefficient. Government is also a monopoly - LTO, for instance, is the only entity allowed to issue driver’s licenses, NBI is the only organization authorized to issue NBI clearances, etc. – but whereas private corporations develop into a monopoly because they have become so efficient as to eliminate all competition, governments on the other hand became monopolies by virtue of social contract. Periodic elections should motivate governments to become “responsive, effective and efficient.” But elections in this country have become so costly for our politicians that their efforts to recoup their expenses often pose a hindrance to our people’s desire for a more “responsive, effective and efficient” government. Thus, it will really take a long time to transplant these foreign ideas into our system. This is not to say that we should give up and stop trying altogether. It is only that we should proceed slowly, but relentlessly.
My Recipe for Reforms
Based on my personal readings and our classroom lectures at the Ateneo School of Government, there seems to be two schools of thought on why corruption is so pervasive in our society. One school of thought believes that corruption is inherent to our culture. This “culture as culprit” theory was first propounded by James Fallows in his essay entitled “A Damaged Culture.” Because lying, cheating and stealing is in our nature, public managers must therefore put in place fool-proof procedures to prevent Filipinos from defrauding government. The rigid regulations, checks-and-balances, exacting ethical standards for public employees and very stringent procurement requirements all stem from this “position of distrust” that assumes the worst in every Filipino.
The other school of thought believes that the Filipino is inherently good – it is the system that makes him bad. Put a traffic aide on the street and pay him P3,000 a month and chances are he will mulct commuters because his salary is not enough to cover his family’s expenses. Tell a businessman that it will take 7 months for his business permit to get approved and chances are he will look for someone to “facilitate” his application for him. Even the much-maligned Filipino politician, whom voters approach for virtually all their needs, steals primarily to fund his political expenses. If civil servants are remunerated properly, if businessmen get their permits right away, if politicians can win elections without having to buy votes, then no one really needs to bribe or defraud the government.
I tend to believe that majority of Filipinos are intrinsically good and it is the corrupt system that makes us bad. Fix the system and people will instinctively abide by the rules. But then again, we Filipinos do have this child-like habit of “ayaw magpahuli” and “follow-the-leader.” Observe that during heavy traffic it only takes one car to counter-flow and then everyone else will follow, with the lead car seemingly acting like a “magnet” attracting other vehicles to follow it. And since so many cars have already counter-flowed, the hapless traffic aide could not apprehend them all and the drivers who violated the traffic laws ironically are the ones to arrive faster to their destinations. Meanwhile, the drivers who opted to obey the rules and stay in their lanes are the ones stuck in traffic, most of whom are probably blaming themselves for not grabbing the “opportunity” to join with the other offenders. Obeying rules for its own sake is really not our defining trait.
The great economist John Maynard Keynes once said: “the difficulty lies not so much in developing new ideas as in escaping from old ones.” Most of the reform ideas that I will be writing about here are not new. In fact, someone at some time has already thought them up and some in fact have already been incorporated as part of official government policy. Here are three strategic action steps that should be taken to curb graft and corruption in government.
1. Eliminate Red Tape in Government Transactions. To be fair, I would like to start by saying that government services have generally improved compared to what it was ten or twenty years ago. For example, I had my driver’s license renewed last month and it only took me exactly 2 hours and 22 minutes to get it at the LTO-SM Megamall Satellite Branch. Ten years ago it would usually take me half a day to process my driver’s license. Be that as it may, there is still plenty of room for improvement. For example, I look forward to the day when I can renew my driver’s license online. Like Mr. Willy Parayno, I too am a great believer in the power of Information Technology and I believe that government should really invest in computerizing its systems to make its transactions faster and its operations more efficient.
Government also needs to seriously implement Republic Act 9485, otherwise known as the “Anti-Red Tape Act of 2007.” Section 6 of the said Act requires all frontline government agencies to put up “Citizen’s Charter” billboards which details the step-by-step procedure, documentary requirements, the name of employee responsible for each step, maximum time to complete each process, amount of fees, and the procedure for filing customer complaints. Compliance to this particular provision of the said law is sporadic. Last month I visited the Mandaluyong Fiscal’s Office, Quezon City Fiscal’s Office, NBI Quezon City Office and the LTO SM Megamall Office and it was only at the LTO Office in SM Megamall that I saw a Citizen’s Charter. Information is power – by giving people access to information on the transaction process many will not fall prey to fixers.
Lastly, public managers really have to change their mindsets. One of the biggest stumbling blocks to efficient government is the “policy of distrust” which I mentioned earlier. In their quest to make their systems fool-proof, public managers often introduce intricate procedures which unwittingly results to more red tape. But easily 99% of our population are honest, law-abiding citizens. If some public employees commit graft or if private individual short-circuited the process, the proper solution then is to catch the culprits and not to punish innocent, law-abiding citizens with additional regulations. Red tape is really the mother of graft and corruption because, in the words of my fellow MPM student David Medel, “kung walang naghihintay, walang maglalagay.” Cut the red tape and you cut corruption – it is as simple as that.
2. Give Civil Servants Their Proper Due. The concept that public employees should receive salaries at par with the private sector is certainly not popular. For one, Filipinos strongly believe that their “corrupt and inefficient” government officials do not deserve to get high salaries. Also, there is the long-established notion that civil servants are more than amply compensated by the “honor” of their positions. Hence, public sector salaries in this country have always been lower than that of the private sector.
A 2007 study conducted by UP Professor Toby Monsod entitled “Philippine Bureaucracy: Incentive Structures and Implications for Performance” had some very interesting findings, to quote: “salaries for senior managers and highly technical personnel in government were 74% below comparable jobs in the private sector, and that salaries for professional and technical personnel were about 40% below, while clerical and trade personnel were actually 20% above the benchmark.” In other words, our government is actually paying its janitors, messengers and other lower ranking employees more than their counterparts in the private sector while underpaying its mid-level and senior-ranking officials by 40% to as much as 74% less than their corporate counterparts. In a phrase, the current government compensation structure can best be described as “the higher you go, the more underpaid you become.”
There is something fundamentally wrong in a society which pays an entry-level call center agent more than a lieutenant in the army. Because of the ridiculously low pay, government service is no longer an attractive career option for most of our youth today. Government needs to make its salaries comparable with that of the private sector to attract quality talent and to avoid becoming into a “government of clerks.” Our country cannot afford a government manned by clerks, especially in today’s Information Age where governance has increasingly become more complex demanding more specialized skills and knowledge.
I believe that public sector salaries should be pegged at three-fourths of what their counterparts in a middle-sized Filipino corporation are receiving. If Ramon Ang of San Miguel Corporation for instance earns P10 million a year, then a public official with tasks and responsibilities similar to his, say a Cabinet Secretary, should be receiving P7.5 million in annual salary. Paying our civil servants salaries that are commensurate to their responsibilities would preclude them from having to commit graft and corruption. Giving civil servants their due is the only way we can prevent corruption and realize efficiency in government.
3. Protect Whistleblowers. By exposing official malfeasance, whistleblowers protect the public interest. One world-famous whistleblower is Jiang Yanyong, a retired military doctor who exposed the cover-up by Chinese authorities of the SARS avian flu epidemic in China in 2003. His revelation forced China to divulge the true state of the SARS outbreak and this enabled other governments to set up measures to prevent the epidemic from spreading to other parts of the world. Dr. Yanyong’s timely expose undoubtedly helped save thousands of lives and in recognition, he was awarded the Ramon Magsaysay Award for Public Service in 2004. But Dr. Yanyong, who was already in his 70s when he made his SARS disclosure, was persecuted by his government and forced to undergo months of “political re-education” by the Chinese Communist Party.
Like Dr. Yanyong, most whistleblowers are often maligned, ostracized and persecuted for spilling the beans. This is especially true in our country, which values highly the ethos of “pakikisama.” But persons who blow the whistle on official malfeasance serve the common good. The State therefore has an obligation to protect them from reprisals. Government should also encourage the development of a “positive whistleblowing culture” among its civil servants to preclude the “powers-that-be” from engaging in corrupt acts. One of the most effective ways of achieving this is by establishing a monetary rewards system for whistleblowers.
There are currently several Whistleblower Protection bills pending in Congress. One of the bill’s most noteworthy feature is the so-called qui tam provision which will grant all whistleblowers 10% of whatever amount recovered by government as a result of their disclosures on official malfeasance. The bill will also provide police protection to all whistleblowers who ask for it and government employees who disclose anomalous transactions in their departments cannot be demoted, transferred or fired from their jobs as a result of their disclosure.
Conclusion
Of all the resource speakers, it is perhaps Miss Ava Cariquez who delivered the most compelling lecture and made the deepest impact on me. This is why I saved her for last. Her life story is also a fitting example for the last point I want to make in relation to Ateneo’s “Our Country is Our Business” motto.
Miss Cariquez had a privileged upbringing and went to the best schools (Ateneo of course), she was charming and attractive, and was earning serious money from her customs brokerage business that allowed her to live large. But her hedonistic lifestyle soon caught up with her and she lost her daughter in a tragic accident. Ava consequently lost the affection of her family and they filed a parricide case against her. The courts found her guilty of parricide and sentenced her to serve reclusion perpetua in the women’s Correctional facility in Mandaluyong. While inside, Miss Cariquez claimed she experienced a “catharsis.” She was unable to explain to our class what exactly was her “catharsis” but all she can say is that it completely changed her as a person.
I believe that Ava’s “catharsis” was the realization that she is not “entitled” to anything. In other words, she lost her “sense of entitlement.” Outside, she lived and behaved like a “princess” – she got everything she wanted, expected people to do things for her, and did anything she liked. She never learned to appreciate all the good things coming her way because she thought she was “special” and felt that she was “entitled” to all of it. But inside Correctional, she discovered she was just a number.
It is very hard to feel contempt for Ava because her egotistical outlook and hedonistic lifestyle is so typical of our generation. As children we were all taught that we were “special” and that we deserve to be “happy.” Today, everyone feels entitled to “happiness,” whatever that is – a nice car, a big house, a loving family, a satisfying career and so forth. And people nowadays are more self-absorbed and have increasingly unrealistic expectations in life. Sociologists have aptly dubbed today’s crop of young people The Generation “Me.”
Emblazoned in the building of the Ateneo Professional Schools in Rockwell is the phrase “Our Country is Our Business,” which is really a take-off from the Jesuit credo “Man and Woman for Others.” Both slogans underline the Atenean ethos of putting the “other” before the self first. It is quite ironic that Miss Cariquez had to learn in jail what the Jesuits tried to inculcate in her when she was studying at the Ateneo, but catharses often occur when people find themselves in a crisis of catastrophic proportions. Only when everything was taken away from her did Ava realize not only how lucky but also how foolish she was to have taken all her blessings for granted. Today she is a changed person – sharing and helping others, appreciative and not taking for granted the small kindnesses of people, cherishing each blessing that comes her way – and she is no longer the egoistic and hedonistic Ava Cariquez of old. Miss Cariquez’s life story serves as a poignant reminder to each one of us to always count our blessings and be content with what we have because after all, we are all just passers-by and are not “entitled” to this world.
06 November 2010
Monday, August 16, 2010
My First Masteral Term Paper
Our professor, former DBM Undersecretary Cynthia Castel, limited our paper to only 8 pages. So here is:
and Private Sector after SSL 3
By Oliver M. Mendoza
In the Philippines, government is characterized by traits that often make it the complete opposite of Weber’s model of bureaucracy as a rational organization. Majority of Filipinos perceive government officials to be corrupt and hopelessly inefficient, and their government not as a provider of services but more as a provider of jobs and largesse. Government workers do not deserve high salaries is a popular sentiment among the people and efforts to improve public sector compensation have always been met with widespread criticism.
This paper will first give a brief history of salaries in the Philippine government. Then it will examine the current government compensation scales vis-à-vis the private sector after the implementation of Joint Resolution No. 4, more popularly known as Salary Standardization 3. Lastly, it will attempt to come up with practical suggestions on how to improve the current compensation structure in government.
Contrary to popular perception, government salaries in the
Table 1: Pre-War Government Salaries and their Estimated Present-Day Values[3]
| POSITION | SALARY PER ANNUM | ESTIMATED PRESENT-DAY VALUE |
| President of the | PhP 30,000 | PhP 10,014,686 |
| Speaker of the National Assembly | PhP 16,000 | PhP 5,341,116 |
| Secretary to the President | PhP 12,000 | PhP 4,005,874 |
| Chief of Records and Curator | PhP 10,980 | PhP 3,665,375 |
| Asst. Secretary to the President | PhP 9,000 | PhP 3,004,405 |
| Secretary of the National Assembly | PhP 9,000 | PhP 3,004,405 |
| Administrative Assistant | PhP 6,000 | PhP 2,002,937 |
| Legislative Assistant | PhP 6,000 | PhP 2,002,937 |
| Protocol Officer | PhP 6,000 | PhP 2,002,937 |
| Member of the National Assembly | PhP 5,000 | PhP 1,669,114 |
| Technical Assistant | PhP 3,600 | PhP 1,201,762 |
| Clerk-Stenographer | PhP 2,400 | PhP 801,175 |
| Steward | PhP 1,560 | PhP 520,763 |
| Librarian | PhP 1,200 | PhP 400,587 |
| Cook | PhP 1,080 | PhP 360,528 |
| Chauffeur | PhP 1,140 | PhP 380,558 |
| Gardener | PhP 1,020 | PhP 340,499 |
| Laundrywoman | PhP 600 | PhP 200,293 |
| Laborer | PhP 600 | PhP 200,293 |
| Security Guard | PhP 600 | PhP 200,293 |
As we can see in Table 1, the compensation structure was not rationalized – there was still no position classification structure and salary rates in the various branches differed markedly. The President, for instance, received almost double the salary of the Speaker of the National Assembly. Also, pay ratios were grossly “undemocratic.” For instance the highest-ranking position (the President) received an annual salary of P30,000 while the lowest plantilla item in government (i.e. Security Guard, Laborer, Laundrywoman) earned only P600 in annual salary, which translates to a pay ratio of 50:1. Policy-makers therefore saw the need to adopt a uniform salary and position classification structure to prevent demoralization and foster professionalization in the Civil Service.
The government attempted to implement a “Compensation and Classification Plan” in 1957 but it was only in 1976 that salaries and positions in all branches and instrumentalities of government were rationalized. Presidential Decree No. 985, signed by President Marcos on
Table 2: Post-War Government Salaries (Monthly) [5]
| Salary Grade | P.D. 985 (1976) | RA 6758 “SSL” (1989) | J. Res. No. 1 “SSL 2” (1994) | J. Res. No. 4 “SSL 3” (2009) |
| 1 | 405 | 2,144 | 5,230 | 9,649 |
| 2 | 448 | 2,223 | 5,701 | 10,373 |
| 3 | 494 | 2,312 | 6,214 | 11,151 |
| 4 | 546 | 2,412 | 6,711 | 11,987 |
| 5 | 603 | 2,525 | 7,248 | 12,886 |
| 6 | 666 | 2,651 | 7,828 | 13,853 |
| 7 | 736 | 2,793 | 8,376 | 14,892 |
| 8 | 813 | 2,950 | 8,962 | 16,009 |
| 9 | 898 | 3,127 | 9,589 | 17,209 |
| 10 | 992 | 3,325 | 10,229 | 18,500 |
| 11 | 1,096 | 3,547 | 10,842 | 19,887 |
| 12 | 1,211 | 3,796 | 11,493 | 21,379 |
| 13 | 1,337 | 4,074 | 12,182 | 22,982 |
| 14 | 1,477 | 4,386 | 12,913 | 24,706 |
| 15 | 1,632 | 4,737 | 13,688 | 26,868 |
| 16 | 1,802 | 5,132 | 14,509 | 29,017 |
| 17 | 1,991 | 5,577 | 15,380 | 31,339 |
| 18 | 2,199 | 6,079 | 16,303 | 33,846 |
| 19 | 2,429 | 6,646 | 17,281 | 36,554 |
| 20 | 2,682 | 7,288 | 18,318 | 39,478 |
| 21 | 2,961 | 8,017 | 19,050 | 42,636 |
| 22 | 3,270 | 8,845 | 19,812 | 46,047 |
| 23 | 3,611 | 9,789 | 20,605 | 49,731 |
| 24 | 3,988 | 10,866 | 21,430 | 53,709 |
| 25 | 4,403 | 12,206 | 22,287 | 58,006 |
| 26 | 4,864 | 13,563 | 23,126 | 62,646 |
| 27 | 5,373 | 14,919 | 24,105 | 67,658 |
| 28 | 5,935 | 16,275 | 25,069 | 73,071 |
| 29 | | 18,307 | 26,072 | 78,916 |
| 30 | | 18,975 | 27,115 | 85,230 |
| 31 | | 19,550 | 29,717 | 97,163 |
| 32 | | 22,000 | 35,661 | 111,198 |
| 33 | | 27,000 | 41,604 | 120,000 |
| 34 | | | 47,547 | |
The 11-year “salary freeze” period (1998-2009) inopportunely occurred during a time of double-digit inflation rates and resulted in further widening the gap between public and private sector salaries. In a study conducted by the Civil Service Commission (CSC) from 2002 to 2006, using salaries in mid-sized private corporations as benchmark, it was discovered that “salaries for senior managers and highly technical personnel in government were 74% below comparable jobs, and that salaries for professional and technical personnel were about 40% below, while clerical and trade personnel were actually 20% above the benchmark”[6] (see attached Annex “A”). Compounding the picture is the preponderance of SSL-exempt government entities (primarily GOCCs and GFIs) which pay salaries that are way above that of other government agencies. These factors in a way forced National Government Agencies (NGAs), Local Government Units (LGUs), the Judiciary and other instrumentalities to circumvent RA 6758 by devising creative ways to increase their employees’ remunerations thru “official but semi-hidden” perks like expense accounts, allowances, subsidized travel or schooling, extra bonuses, etc.
Upon its full implementation in 2012, SSL 3 will make salaries in the Career Sub-Professional (SG 1-9) and Professional (SG 10-24) levels more or less at par with the private sector, provided that the current private sector rates will remain the same until 2012. But the third Career Executive Service (SG 25-30) level will continue to suffer considerable disparities in pay over their private sector counterparts. [7]
Discussion
President Benigno Simeon “Noynoy” Aquino III recently complained that he is encountering difficulties finding “good people” to fill up critical positions in his government.[8] This really comes as no surprise because even after the passage of SSL 3, several internal and external factors continue to make government service unappealing to “good people.” External factors include the huge disparity in pay of the third Career Executive Service level vis-à-vis their corporate counterparts. The SSL compensation scheme, which can be better described as “the higher your rank, the more underpaid you become,” makes it very hard for government to attract and keep executive talent. Internal factors include increased “politicization” in the government appointment process and the proliferation of SSL-exempt agencies which pay their employees way above the government rate. A study conducted by Dr. Toby Monsod for UNDP entitled “The Philippine Bureaucracy: Incentive Structures and Implications for Performance” showed that “the share of CESO eligibles occupying CES positions has been falling beginning around 2004. A decreasing share indicates that the share of political appointments is increasing and/or that CESO eligibles are leaving voluntarily. Note from the numbers alone that this decreasing share cannot be attributed to a lack of supply of CESO eligibles to fill in CES positions. There is even a decreasing trend in the share of CESO eligibles even in GOCCs that are SSL-exempt. In other words, the monetary incentives in these agencies could be inviting greater political intervention in the hiring of personnel. In turn, such interventions may be causing CESO eligibles to leave.”[9] In his first-ever State of the Nation Address (SONA) President Aquino described as “scandalous” the salaries of MWSS executives and Congress has responded by conducting an investigation into the “excessive” salaries of GOCC executives.[10]
All these factors tend to erode the principles of “merit and fitness,” “security of tenure” and “equal pay for equal work” enshrined in RA 6758. If not addressed, the Philippines will most likely end up with a Civil Service bureaucracy manned by “clerks” and ran by “dilettantes in public service” (read: political appointees). This development is truly alarming because it comes at a time when governance becomes increasingly more complex requiring higher levels of educational preparation, competence and imagination. In today’s fast-changing and highly-competitive world, the
It used to be that the Philippine Civil Service attracted the best and brightest Filipinos because of its attractive compensation rates. Based on historical records and anecdotal stories from people who lived through the pre-War period (or “Peacetime” as oldtimers call it), ordinary rank-and-file civil servants like public school teachers and police officers were highly-regarded and people were generally satisfied with the performance of their public servants. Of course one can always argue that Filipinos were simpler then, that people were more trusting of their leaders and less cynical about their government. But the fact remains that because of the good pay, government attracted good-quality people and the quality of public service during the Commonwealth Period was inarguably high.
Various studies have shown that governance outcomes are primarily determined by the quality of leadership in government – bad leadership results to bad governance while good leadership results to good governance. Studies have also shown a causal link between good governance and development. In fact, a World Bank Institute (WBI) study was able to measure precisely the “development dividend” derived from good governance, which it claims translates to a 400% increase in incomes per capita in the long run, improvement in infant mortality from 2.5 to 4 times, and improvement in literacy rates by 15% to 25%.[11] Thus viewed from this perspective, the potential “development dividend” from good governance should convince Filipinos to invest more in their public servants.
Recommendations
Clearly, the government’s “high-minded approach” towards recruitment is no longer effective. In this day and age, governments must simply compete with the private sector in attracting good-quality people to join the Civil Service. But simply increasing public sector salaries to mirror that of the corporate sector will not be enough to produce positive outcomes: government also has to address the existing internal inequities to prevent further demoralization and promote professionalization in the Civil Service. Below are three concrete steps to correct the situation:
1. Enact the “Career Executive Service Act.” While it is virtually impossible to insulate the selection process for senior government positions from factional politics, this should not stop government from instituting measures that would ensure that only qualified persons, whether political or career, are appointed to positions of high responsibility in the bureaucracy. This is the main rationale for the Career Executive Service Act (CESA).
During the last 14th Congress, the version authored by Iloilo City Congressman Raul T. Gonzalez, Jr., Chairman of the House Committee on Civil Service and Professional Regulation, wanted to establish a “Judicial and Bar Council-type” selection process wherein a “Selection Board” (composed of the CSC/CESB and OP/OES) will vet applicants to senior government positions and present a shortlist of nominees for approval first by the Secretary of the department where the applicant is seeking appointment and finally to the President. The Civil Service Commission under then-Chairperson Karina Constantino-David wanted to include a provision in the bill specifying a more definitive “career vs. political appointments” ratio (first it was 60-40, then it became 50-50) in the Civil Service but it was thumbed down at the Technical Working Group (TWG) level as “impractical” and “virtually un-implementable.” The Career Executive Service Act bill was passed on 3rd reading in the House of Representatives but was not deliberated upon by the Senate Committee on Civil Service, which was chaired by Senator Antonio Trillanes IV.
2. Repeal the Salary Standardization Law. The Salary Standardization Law has failed to achieve its stated purpose. Twenty years after it was enacted, the government compensation structure remains un-rationalized. Today, a driver working in an SSL-exempt agency receives more than a driver doing the exact same work at DTI or Congress. In fact, a recent DBM-CSC study showed that executives of several GOCCs and GFIs (i.e. GSIS, PDIC, BCDA, etc.) already receive salaries far higher than the President of the
In fact, the Salary Standardization Law has only succeeded in demoralizing our career public servants. Government workers are demoralized not so much because their wages are low – the vast majority of our public servants have already accepted it as a given when they decided to join public service – but more because it is patently unfair for employees of SSL-exempt agencies to be receiving higher salaries for performing basically the same tasks. The list of government agencies applying for SSL-exemption grows longer every year and Congress definitely has not been parsimonious in handing out exemptions. As the number of SSL-exempt agencies grows larger every year, government workers will increasingly be split into two classes of employees – the “haves” (those exempted from SSL) and the “have-nots” (those covered by SSL). Congress should therefore repeal the Salary Standardization Law before this happens and fashion a new compensation policy for government employees.
3. Introduce a “Performance-Based” Compensation Structure. Instead of a standardized, one-size-fits-all salary structure, the national government should consider adopting a “performance-based” compensation and incentive structure wherein excellent performance is financially rewarded and mediocre performance penalized by pay cuts. “Performance-based” here does not mean individual but group or departmental performance. And performance measures or indicators should be based not only on “the volume of output” but more on the actual end-results or outcomes.[12]
Public servants are often timid and “tamad” because under the current set up, nothing good happens to them when they do a good job and nothing bad happens to them when they do a bad job. Under this performance-based compensation scheme, wages in government shall not be uniform or standardized; rather, employee incomes will vary or fluctuate depending on how their department fares in the performance audit conducted by an independent, third party body. This way, employees of better-performing departments shall be receiving salaries higher than those employed in lesser-performing departments. At the same time, employees in lesser-performing agencies will be better motivated to improve their performance. By equating pay with performance, the Philippine bureaucracy will become more “entrepreneurial” – that is, results-oriented and mission-driven – and by fostering competition, the Civil Service will become more efficient and effective. The healthy competition among agencies will make government into a “team of rivals.”
Performance-based compensation systems have been proven effective in motivating and enhancing productivity of government employees as in the famous “China Lake Experiment” of the
Conclusion
As the great economist John Maynard Keynes once said: “the difficulty lies not so much in developing new ideas as in escaping from old ones.” In other words, the greatest impediment to reform is really “the power of outdated ideas.” The proposal to introduce a performance-based compensation structure in lieu of the Salary Standardization Law is sure to generate intense opposition in the bureaucracy. Bureaucracies, after all, have always been resistant to change.
But the world has been swept by tremendous changes in the last 50 years. We now live in a global economy wherein events in places as far away as the
[1] “From
[2] From the time of the Commonwealth until the administration of President Diosdado Macapagal, the peso-dollar exchange rate was fixed at P2 to $1. So whether in 1937 or 1957, the President’s annual salary of P30,000 was equivalent to $15,000. To find out what $15,000 would be equivalent to what it can purchase today, economists often refer to the table “Purchasing Power Conversion Factors” prepared by the
[3] Source: Manolo Quezon’s blog (www.quezon.ph/2007/10/01/the-empire-strikes-back/#comment592123)
[4] Article IX, Section 5 of the Constitution: “The Congress shall provide for the standardization of compensation of government officials and employees, including those in government-owned-or-controlled corporations with original charters, taking into account the nature of the responsibilities pertaining to, and the qualifications required for their positions.”
[5] Sources: Presidential Decree 985, Republic Act 6758, Joint Resolution No. 1 (series 1994) and Joint Resolution No. 4 (series 2009). Amounts quoted are based on salary rates upon full implementation of said laws.
[6] “The Philippine Bureaucracy: Incentive Structures and Implications for Performance” by Toby C. Monsod. HDN Discussion Paper Series, PHDR Issue 2008-2009 No. 4.
[7] DBM Powerpoint Presentation on Proposed SSL 3
[8] “A Few Good Men in Government: Noynoy hard-pressed to fill vacant jobs in public service” by Robert Gonzaga, Philippine Daily Inquirer
[9] “The Philippine Bureaucracy: Incentive Structures and Implications for Performance.” Monsod, Toby. HDN Discussion Paper Series, PHDR Issue 2008/2009 No. 4 pp. 18-21.
[10] “Probe on Alleged Excessive Salaries of GOCC Execs Sought” by Christina Mendez, Philippine Star
[11] “Governance Empirics: Some Methods, Findings and Implications.” A video presentation by Daniel Kaufmann, World Bank Institute at the 4th Session of the Committee of Experts in Public Administration, UN ECOSOC, UN Headquarters, New York (slide 15).
[12] For instance, when public organizations set out to measure performance, their managers usually draw up lists that measure how well they carry out some administrative process i.e. how many people they served, how fast they served them, what percentage of requests are fulfilled within a set record of time, etc. In essence, they measure their “volume of output.” But outputs do not guarantee outcomes. A TESDA tech-voc school might pump out more and more graduates of a welding program for instance but if those graduates cannot find jobs as welders, what good is the program? Thus, government will just be spending money without generating any positively tangible outcomes.
[13] “Reinventing Government: How the Entrepreneurial Spirit is Transforming the Public Sector.” David Osborne and Ted Gaebler, Penguin Books 1992 page 128.