Huge pay rise for Solomons politicians

Solomon Islands Prime Minister Manasseh Sogavare

Members of Parliament in Solomon Islands are due to receive a huge pay rise this year despite the nation’s precarious state of the economy and poor government service delivery.

The pay increase was published in a government gazette last Tuesday.

While the decision is highly likely to infuriate tax-payers and government workers, chair of the Parliament (Entitlement) Commission (PEC), Johnson Siapu says the pay award is long overdue.

“Members of Parliament have not received a pay rise since 2019,” Siapu told In-depth Solomons.

“So they are entitled to get their pay increase this year,” he added.

The new increases would see the prime minister receive an annual salary of $428,560.12 (US$51,288), up from $307,919.52(US$36,945) – an increase of $120,640.60(US$14,474) or 39 percent rise.

The deputy prime minister’s new annual salary will be $385,226.79(US$46,062). This is an increase of $107,486.62 (US$12,890) (or 39 percent) from the old pay of $277,740.17(US$33,309).

Ministers, Leader of Opposition and Leader of the Independent Group will be paid $334,539.33 (US$40,183), up from $242,439.08(US$29,120) – an increase of $92,100.25(US$11, 11,071) or 38 percent.

Standing Committees will all get a new annual salary of $301,894.02(US$36,290). Their last salary was $219,703.37 (US$26,421) – an increase of $82,170.19(US$9,881) or 37 percent.

Ordinary MPs will receive $272,047.34(US$32,554), up from $198,809.83(US$23,790) – an increase of $73,237.51(US$8,763) or 37 percent.

Other entitlements remain the same.

Siapu says the new salaries will come into effect in April this year.

It comes at a time when government service delivery is at its poorest, whilst families and businesses struggle daily to make ends meet.

The pay rise also comes not long after Finance minister Harry Kuma, in his 2024 budget speech last October, cautioned government ministries to control excessive and potentially unnecessary expenditures on consumables, travel, conferences, seminars, and training that will bear no lasting benefits for the country.

Kuma said in 2024, spending should be on sectors that will boost economic growth or improve tax collection for the national good.

But Siapu adds the decision to award the pay rise this year was based on consultations carried out with stakeholders, including the Central Bank of Solomon Islands (CBSI) and the Ministry of Finance & Treasury.

“The advice we got is that the economy is now ‘okay’.

“We’ve held on to giving our MPs their pay rise since 2019 because of the poor state of the economy, as well as the Pacific Games we’ve hosted last November.

“Now that the games are over and the economy is okay, we decided to award the pay rise,” Siapu said.

He also explained that this is a gross-up salary. 

“What this means is you have the tax component of a basic salary added to the basic. 

“Since their salary is now taxable, once you remove the tax component the total falls back to the basic above.”

Furthermore, Siapu said MPs’ salary can only be increased on three conditions: state of the economy, movements in the level of pay admissible to other persons in employment and changes in the retail price index and other relevant indicators.

“The commission in its findings have confirmed to satisfy the above conditions since 2019 but could not proceed to approving the gross-up salary because of the COVID19 pandemic, which commenced in 2019 and continued into 2021/22. 

“It was lifted in 2022 but PEC again cannot proceed with the approval because of the 2023 Pacific Games. 

“However, PEC was advised by MOFT that PEC can only proceed with the gross-up salary approval in 2024.

“What also needs to be understood is the country’s current state of the economy cannot go away from us anytime soon.

“So we cannot continue to wait that long to give the MPs their legal entitlement.

“What if they sue us?”

Siapu said public servants received their pay rise in 2016, 2018 and 2019 at 3.5% respectively, which totalled up to 10.5 percent.

For MPs, he said this is the only increase in the gross-up calculation.

But Ruth Liloqula, the chief executive of Transparency Solomon Islands (TSI), says this latest pay rise is “unreasonable”.

“It’s not a right thing to do at a time when the country does not have enough money,” Liloqula told In-depth Solomons.

“This is another example of leaders who should be looking after the people, helping themselves,” she added.

Liloqula said one of the most concerning things about this latest pay rise is the DCGA government’s inclusion of the chairman of Government Caucus into this entitlement.

“Already, the Court of Appeal has ruled that it is unconstitutional to make any provision for the chairman of the Caucus because it’s not a parliamentary body, but an executive one.

“So what this government did now is change the name to Parliamentary Caucus. But there is no such thing as ‘Parliamentary Caucus’.

“The Caucus is an executive body.”

Under the pay increases, chair of the Parliamentary Caucus (formerly government caucus) gets an annual salary of $301,894.02 (US$36,269)

Liloqula said this is a complete manipulation of the system to suit the DCGA government’s greed.

However, Siapu said this is a 2015 Parliamentary Entitlement Regulation(s) (PER) amendment and the court has already made a ruling on it. 

“The only thing I can say is PEC is now working on the PER to consolidate the many changes that have occurred since then.”

Meanwhile, prominent Honiara businessman and chief executive officer of Solomon Motors Ltd Craig Day, described the pay rise as “totally immoral and an abhorrent to business houses who are expected to foot the bill for this ridiculous decision”.

“The economy is not okay,” Day, who runs a number of refuelling stations, speciality shops and accommodation facilities in Honiara, said.

“One only has to look at the growing unemployment problem in the country and lack of substantive economic policy from the government to deal with this, to appreciate that the economy is not in good shape at all,” he added.

Furthermore, Day said the performance of the DCGA government to date, and the MPs in general, has been extremely poor. 

 “And this has been proven by the fact that there has been a total collapse in the provision of government services, including health, which is deteriorating to the extent of patients dying in the hallways of the hospital without medicines, our road system has essentially collapsed and riddled with potholes in Honiara, and children have been let out of schools at 12.30pm, receiving only half of their education.” Day said police and health workers across the country should also demand similar pay increases from the Government so that it’s fair to everyone.