Govt revises MP scale salary 45% upwards - but why the fuss?

November 02, 2023 (MLN): The caretaker government has decided to enhance financial remuneration paid to key people hired from the private sector into the bureaucracy. These people are "experts" in their respective fields are inducted to aid the current deficiency in traditional career diplomats.

The government needs them more than they need the government. 

Revised pay scales are;

MP-1: Rs ~900,000-1,100,000 (USD 3250-4000) per month
MP-2: Rs ~450,000-675,000 (USD 1600-2500) per month
MP-3: Rs ~300,000-400,000 (USD 1000-1450) per month

To many yes these would arguably look much higher than their current take-homes given the private sector employers take a few years to adjust the salaries to real purchasing power depending on the corporate profitability. Nevertheless, when such private sector employees move into the public sector for a nominal increase in salary, they forego bonuses, job training and a clear path ahead and usually are on a contract basis. 

Public sector performance remains extremely critical to the well-being of the economy and thus lives of hundreds of millions. People at the helm of the affairs are making decisions having implications of hundreds of millions of dollars over the life of the decision.

Thus, the real alignment of interest and performance incentives is crucial to delivering quality output, reshaping economies and reducing income inequalities. 

With adequate compensation, key government employees would have less incentive to procrastinate, not take risks and find other sources of income.

For civilians, these civil "servants" would do a better job if kept motivated and rewarded. Pakistan already has a massive permanent brain drain along with low salaries.

Very few people opt to enter the public sector and most quit in dismay for bringing change.

Give them another shot. Public-private partnerships are key prerequisites of economic development - pay them fairly, if not more.

The author is an independent economic analyst and writes on Twitter and Linkedin.