Tactics and Political Dynamics of Public Service Pay Lessons from Sub-Saharan Africa Denyse Morin...
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Transcript of Tactics and Political Dynamics of Public Service Pay Lessons from Sub-Saharan Africa Denyse Morin...
Tactics and Political Tactics and Political Dynamics of Public Dynamics of Public
Service Pay Service Pay
Lessons from Sub-Saharan Lessons from Sub-Saharan AfricaAfrica
Denyse Morin Kithinji Kiragu
May 25,2005Addis Ababa
Thanks & Thanks & AcknowledgementsAcknowledgements
• DFID and the World Bank• Cooperation and Support
– Governments– Trade Union Representatives– Academia– Civil Society Groups– World Bank Country Offices
OverviewOverview
• Pay is a Key Public Service Issue
• Pay reform is one of the most difficult areas of public sector reformComparatively poor pay has
remained a feature of most public services
Major feature of concern for public services in most countries
The ProblemThe Problem
Why have efforts made to bring about pay reform not resulted in more success?
Why have pay levels remained low?Why has implementation been
difficult?
Study ObjectivesStudy Objectives
Collect and organize data and information on public service pay policy experiences
Explore and describe the context and limits to which technical models have guided pay reform strategies and policies
Explore and explain the political contexts and rationales underlying pay policies and strategies adopted
HypothesesHypotheses
A successful strategy for public service pay reform is underpinned by choice of correct tactics and sequencing of the appropriate measures
Technical solutions to public service pay reform without due attention to a country’s politics are not sustainable
Approach/MethodologyApproach/Methodology
Two-stage process to see if there is a match between the technical choices, political developments, and pay policies and implementation:
First StageFirst Stage Map out in detail the pay policy choices, the
tactics, techniques and the sequences Identify & analyze the political context and
major political considerations and developments
Illustrate and trace implementation stages of public service pay policy changes including identifying implementation stages
Attempt to see if there is a correlation between the three variables mentioned above within each study country
Second StageSecond Stage
Compare the experiences of the countries under study on the basis of the three variables mentioned above
Establish if there is any correlation across countries along these variables
Draw out the lessons of experience and suggest strategic options in varying political environments
OverviewOverview
Pay Policy Tactics and ModelsPolitics and PayRole of institutionsStrategic Options
What is Pay?What is Pay?
Pay=salary+monetary benefits+ in-kind benefits [including retirement]
Nevertheless, salary remains the core element of pay
When salary is replaced by benefits and allowances there are explicit or implicit technical and/or political considerations
Salary trend is a good indicator to the decisions underlying pay changes
Trends in MedianTrends in Median Salary ($)Salary ($)
0
2000
4000
6000
8000
10000
12000
14000
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Year
Benin Botswana Burkina Faso Ghana Senegal Tanzania Uganda Zambia
Salary Compression RatiosSalary Compression Ratios
-
5.0
10.0
15.0
20.0
25.0
30.0
35.0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Year
Ratio
Benin Botsw ana Burkina Faso Ghana
Senegal Tanzania Uganda Zambia
Nominal Wage Bill to GDP RatioNominal Wage Bill to GDP Ratio
-
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
1992 1993 1994 1995 1996 1997 1998 1999 2000
Year
Ratio (
%)
Benin Burkina faso Senegal Ghana Tanzania Uganda Zambia
General Pay Trends in 1990sGeneral Pay Trends in 1990s
Botswana: consistently high and decompression
Tanzania & Uganda: rising levels and decompression to a point
Ghana, Senegal & Zambia: overall deterioration, increased use of benefits
Bénin & Burkina Faso: declining salary levels and compression
Models, Tactics & TechniquesModels, Tactics & Techniques
Models Tactics and Techniques1. Corporatism National incomes policy, review
commissions, moderated collective bargaining
2. Salary indexation Politically preemptive, controlled collective bargaining
3. Wage bill & employment modeling
Invoking affordability constraints, controlling numbers
4. Pressure-driven /patronage
Ad hoc awards to politically strong or favored groups
5. Cost of living/MLW Emphasis on egalitarian objectives
6. Job evaluation /salary regrading
Job specification, workload assessment, emphasis on equity
7. Market benchmarking
Comparator studies, decompression
8. Performance-related
Performance management systems and productivity measurement
Models fall into 3 categoriesModels fall into 3 categories
Model Category
Characteristic Features
Technically rational (TR)
•Neo-liberal economics and/or HRM orientation (ideal)•Largely impervious to political pressures
Politically rational (PRA)
•Measured consideration to political factors (explicit or implicit)•Primacy of egalitarian concerns
Politically reactive (PRE)
•Predominantly driven by political pressures/exigencies
Mapping Models Against a Mapping Models Against a Rational FrameworkRational Framework
MODEL CATEGORY
MODELS
Technically rational (TR)
•Performance-related•Market benchmarking•Wage bill & employment modeling•Job evaluation and regrading
Politically rational (PRA)
•Cost of living/MLW•Salary indexation•Corporatism/consensus-based
Politically reactive (PRE)
•Pressure-driven/patronage
Model Trends since 1960sModel Trends since 1960s
TR •Ghana
•Botswana•Uganda
•Botswana•Tanzania
PRA
•Burkina Faso•Benin•Senegal•Zambia•Botswana•Ghana•Uganda•Tanzania
•Botswana
•Senegal
•Zambia•Tanzania
•Botswana
•Senegal
•Tanzania
•Senegal
•Burkina Faso•Benin
•Uganda
•Senegal
•Burkina Faso
PRE
•Ghana•Burkina Faso•Benin
•Uganda
•Zambia
•Burkina Faso•Benin•Uganda
•Tanzania•Zambia•Ghana
•Benin•Ghana•Zambia
PERIOD 1960-75 1975-85 1985-90 1990-95 1995-2000
Politics MatterPolitics Matter
What constitutes the essence of politics is the constraints under which political actors operate and the strategic maneuvering that they occasion and that occurs within them
Politics is a complex game of strategic calculations. Politicians often face the so-called “politicians’ dilemma” in deciding among a set of policy preferences:
Politician’s DilemmaPolitician’s Dilemma
Conflicting Objectives:
• To survive in office; to build a loyal political organization—no suicide
• To govern effectively & efficiently
Trade-OffsTrade-Offs
• Cultivating partisan loyalty
• Adopting technical solutions for effective performance
Institutions MatterInstitutions Matter
Variations among politicians’ preferences largely depend on:
• the nature of the political system
• the nation’s institutions.
ActorsActors
ADMINISTRATIVEINSTITUTIONS
• President Ministers Public Sector Bureaucracies and Technocracies
THE DONORCOMMUNITY
• Donor Agencies Consultants
MARKETINSTITUTIONS
• Private Sector The Business Community
POLITICS OF RESOURCE
MOBILIZATION AND ALLOCATION
(The BudgetaryProcess)
CIVIL SOCIETYINSTITUTIONS
• The ruling political party Political Parties in opposition Trade Unions Media Others
REPRESENTATIVE INSTITUTIONS
•ParliamentLocal GovernmentCouncils/Assemblies
THE POLITICAL SYSTEMTHE POLITICAL SYSTEM
Political MappingPolitical MappingVARIABLE BENIN BOTSWANA BURKINA
FASOGHANA SENEGAL TANZANIA UGANDA ZAMBIA
Political System
-Uncompetitive Pluralism
-Competitive
X
X X
X X
X X
X
Political Stability
-Unstable
-Unpredictable
-Fairly Stable
-Stable
X
X
X X
X X
X X
Regime Legitimacy
-Low
-Medium
-High
X
X
X
X X X
X X
Institutionalization
-Low
-Medium
-High
X
X
X X
X X
X X
Popular Base of Regime
-Factional
-National
X
X
X X X
X
X X
Relevance of Political Relevance of Political InstitutionalizationInstitutionalization
High
Low
Institutionalization
Technically rational
Politically rational
Politically reactive
Competitiveness of PoliticsLow High
Botswana, Tannzania
Senegal, Uganda, Burkina Faso
Benin, Ghana, Zambia
Institutionalisation & Institutionalisation & CompetitionCompetition
Institutionalisation
High Uncompetitive Monopolistic
Uncompetitive Pluralism (i)BotswanaTanzania
Mature Democracy
Medium UncompetitivePluralism (ii)UgandaBurkina Faso
Weak DemocracyBenin; GhanaSenegal;Zambia
Low
Low Medium High
Competitiveness
Politics and Pay PoliciesPolitics and Pay PoliciesPolitical System and Reform Performance Political System and Reform Performance
CompetitionCompetition Variables Near-zero
CompetitiveModeratelyCompetitive
Competitive Pluralism
Dominant Political Dynamic
Tamed Politics
Moderate tension
High tension
Institutionalisation
High Medium Medium
Regime Legitimacy
High Low to Medium
Medium
Stability High Fair Fair
Dominant Pay Models
Technically Rational
Politically Rational
Politically Reactive
Beyond technical Beyond technical merit…merit…
•Politics matterPolitics matter• Institutions matterInstitutions matter
Politics, Institutions and Technical Politics, Institutions and Technical ModelsModels
Politics Matter. The nature of the political system, regime legitimacy and stability, and the dynamics of the political process are all critical variables in pay reform
Institutionalisation of political life and organizations matter. Acceptance and respect for rules of the political game by major political actors and the general citizenry is very important, especially for competitive political systems
Ultimately and ideally, technical models can fully and sustainably prevail in a competitive political system that is highly institutionalised, stable, and enjoys high levels of legitimacy.
Strategic OptionsStrategic OptionsPolitical & Political & Institutional Institutional EnvironmentEnvironment
Policy and StrategyPolicy and Strategy
Low Stress (low competition/strong institutions)
•Scope for technically-rational models•Watch for stress
Moderate Stress (medium competition and average institutions)
•Stick to politically-rational models•Strengthen institutions
High Stress (intense competition and fragile institutions)
•Long-term perspective•Consensus building
Therefore…Therefore…
• Need to understand and appreciate the political context and political variables critical to success of pay reform programmes
•Political system•Social structure•Nature and strengths of power
centres
Implications for the countries where you work?