Proposal For New Public Sector Compensation Structure To Be Submitted To Cabinet

A proposal for a new public-sector compensation structure is expected to be brought to Cabinet for consideration by December 2020.

This has been disclosed by Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, who said the proposal is to be arrived at following a review of the structure as part of the ongoing transformation of the public sector.

The review, which is to be undertaken at a cost of US$1.58 million over an 18-month period beginning January 2020, is seeking to streamline public-sector compensation and make it more transparent.

International consulting firm, Ernst and Young Jamaica Limited has been contracted to carry out the review, in collaboration with the Finance Ministry.

Dr. Clarke, along with representatives from Ernst and Young, signed the contract on Wednesday (December 4), during a ceremony at his National Heroes Circle offices in Kingston.

The Minister noted that the structure of compensation in the public sector has long been “a bone of contention”, as it is “very complicated and very layered” and in many instances inequitable.

He pointed out that the review will involve evaluating public-sector compensation as a whole, and benchmarking compensation against what happens elsewhere in Jamaica.

“We will be looking towards establishing a single job-evaluation system, where jobs can be evaluated according to a single criterion, rather than using multiple job evaluation criteria, which we have been using over the past several decades, which has resulted in a public-sector compensation that is varied and suboptimal,” Dr. Clarke said.

He noted, as well, that there are more than 325 distinct grades in the public sector, which is not sustainable and leads to a public-sector compensation system that is inefficient and non-transparent.

“In addition, there are at least 185 separate and distinct allowances across the public sector, and that is a problem because it leads to complexity and it also leads to inequities within bargaining units, within ministries, departments and agencies and across different employment types and different employment categories… and makes compensation very opaque and very difficult to predict and to forecast and, as a result, means that Jamaica’s ability to plan its finances into the future is compromised,” he said.

Under the contract, the consultants will develop a proposal for a pay-for-performance and reward framework; develop a compensation philosophy and policy; and cost and indicate the financial impact of the new compensation structure. The consultants will also develop a single job-evaluation tool for the public sector.

In the meantime, the Minister and Ernst and Young also signed a contract valued at US$5.45 million to implement shared corporate services for the public sector.
This component seeks to consolidate various administrative and support functions into a central space where it can be applied across government.

“We are aiming to bring greater levels of efficiency to the public sector by consolidating administrative and support functions into a single area that can serve the entire public sector. We will be seeking to do that along a number of functional areas, such as human resources (HR), legal services, internal audit, public relations and other such support functions,” Dr. Clarke said.

This exercise is to begin in January 2020 and last for 24 months.

These activities fall under the Public Sector Transformation Programme, jointly funded by the Government, World Bank, and the United Kingdom Department for International Development.

The aim is to strengthen public resource management and support State institutions in facilitating a more enabling environment for private-sector growth.