When a disgustingly overweight person gluttonously swallow a plate for four, it is only right for a doctor to kindly advise the person to slow down and go on a healthier diet. It would be almost sinful if the doctor kept his wisdom to himself. In the same light, it is almost sinful not to criticize the Malaysian civil service for going on an unhealthy diet of salary increase.
I believe that I speak within the same wavelength with many others when I say I would like to see a respectable civil service. I would like to see a civil service that creates envy among those not on its payroll. I would like to see a civil service that attracts not contempt but admiration among the public.
The Malaysian civil service could do just that by raising wages and benefits within the institution as well as downsizing. One of two components of the policy has been exercised this week. Unfortunately, it has not been done properly. When the Prime Minister announced the pay hike, it is not a step forward but instead, it is a step backward.
High wages, given proper condition, is a tool to attract the best talents into any organization. Furthermore, wages reflect productivity and productivity between individuals might differ. Hence, there should be variance among wages when productivity levels differ, vertically as well as horizontally. In order words, wages increase across individual of different productivity level should not be uniform, horizontally or vertically, unless productivity itself is uniform.
The hike recently declared by the Prime Minister is clearly being executed without respect to productivity. It seems that everybody is being rewarded equally horizontally and thus, it does not discriminate high and low productivity individuals. Therefore, its carrot and stick model lacks the stick while everybody gets a carrot. In short, the policy is blunt.
While that method might reward deserving individuals with wondrous work effort, it also rewards under-performers. If an organization rewards low performance — as much as high productivity workers, no less — the better workers would sooner or later realize that one would get the same rewards with less effort. Thus, given time, the average productivity would fall toward the lowest point.
This undiscriminating reward system requires resources and the over-generous act of rewarding everybody requires tremendous resources. Scarcity unfortunately is real. Nobody needs an economics degree to know this, save, maybe, the communists. Eventually, there will be insufficient resources to sustain the over-generous model. This unsustainability will bring the civil service back to square one: low paid public sector. Moreover, it prevent the introduction of competitive salary levels across similar productivity levels needed to attract the best talents available.
If the civil service aspires to be the employer of last resort, then the over-generous model might work marvelously well in its favor. As an employer of last resort, the civil service would prefer quantity to quality.
For a respectable civil service, the model must reward performers and punish slackers. What the civil service needs is a proper carrot and stick model. Reward the able, sack the slackers and through this, stop being an employer of last resort. I say it again: increase the salaries within the civil service to competitive market rate and downsize. The civil service must get on a healthier diet.
In the final analysis, the recent hike is a perfect example of blunt and poorly designed policy. Blunt policy, including blanket fuel subsidy among others, creates unintended and possibly adverse consequences. This blunt policy of unselective wages increase in the civil service without attention to productivity in particular will create adverse unintended consequences that will further lower the standard of the Malaysian civil service.
Blunt policy might help the Prime Minister winning an election but it is not good enough to build a better society.
p/s — I might have unwittingly given the impression that productivity is the only determinant of wages. I apologize but I do not imply as such. Just to clear the air, there are other determinants of wages. One of them is scarcity of skills.