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Executive Summary | Table of Contents | Multilingual Summaries | How to order
 More pay for better performance: can such a policy be beneficial in the public sector? This report presents an overview of performance-related pay policies (PRP) for government employees in 14 countries over the past two decades. Both the strengths and the weaknesses of PRP policies are assessed.
The report explores the various paths of reform in each country, investigating the reasons why PRP policies are being implemented and how the policies operate concretely. The outcomes of PRP policies at the individual and team levels are evaluated. Recommendations are made on what should be done and what should be avoided with the implementation of PRP. This book, based extensively on country reports, draws lessons from the two decades of experience with performance-related pay and assesses the impact on public sector efficiency.
Executive Summary
Twenty years ago, nearly all civil servants in the central government of OECD member countries were paid according to service-incremental salary scales. This is not to say that civil servants previously lacked performance incentives. Promotions, and especially those into senior management, were rigorously controlled, serving partly as an incentive but partly also as a way of ensuring the independence of the public service with regard to the executive and thus its ability to serve governments of different political persuasions. However, socio-economic pressures have led to the need for types of incentives other than “promotion” to strengthen performance management. Remuneration has been seen as an alternative or a complementary incentive to promotion.
By the turn of the millennium, significant numbers of civil servants were covered by performance-related pay (PRP) schemes of one kind or another in most OECD member countries, particularly senior managers, but increasingly also non-managerial employees. The introduction of performance pay policies occurred in the context of the economic and budgetary difficulties faced by OECD member countries from the mid-1970s. Reasons for introducing PRP are multiple, but focus essentially on improving the individual motivation and accountability of civil servants as a way to improve performance. PRP is seen as a signal of change for civil servants and as a way of indicating to citizens that performance is regularly assessed in public administration.
Table of Contents
Part I - Performance-related Pay Policies for Government Employees: An Overview of OECD Countries
- Chapter 1. Performance Pay in the Wider Management Context
- Chapter 2. Key Trends in Performance-related Pay in OECD Countries
- Chapter 3. Implementation and Impact of PRP: Lessons to be Learned
Part II - Case Studies
- Chapter 4. Country Case Studies
- Performance-related Pay in Canada
- Performance-related Pay in Denmark
- Performance-related Pay in Finland
- Performance-related Pay in France
- Performance-related Pay in Germany
- Performance-related Pay in Hungary
- Performance-related Pay in Italy
- Performance-related Pay in Korea
- Performance-related Pay in New Zealand
- Performance-related Pay in Spain
- Performance-related Pay in Sweden
- Performance-related Pay in Switzerland
- Performance-related Pay in the United Kingdom
- Performance-related Pay in Chile
- Chapter 5. Case Studies of Performance-related Pay Schemes
- Performance Pay for School Teachers in England and Wales
- The National Institute of Social Security (INSS), Spain
- Ministry of Defence, United Kingdom
The Department for Work and Pensions (DWP), United Kingdom: An Example of Team Pay
- The Case of the Revenue Agency, Italy
- Annex A. Performance-related Pay Policies Across 12 OECD Countries: Brief Overview
Multilingual Summaries
How to order this publication
Readers can access the full version of Performance-related Pay Policies for Government Employees, choosing from the following options:
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Subscribers and readers at subscribing institutions can access the online edition via SourceOECD, our online library.
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