|1||How much do public servants make?|
|2||Is the same methodology used to calculate compensation for each occupational group shown in Government at a Glance 2011?|
|3||What is total compensation?|
|4||How do you ensure comparability across countries for the compensation data for central government workers? And what are the main limitations of those comparisons?|
|5||In which country do government staff work the most hours?|
|6||Are bigger governments in greater fiscal trouble?|
|7||Is there an optimal deficit- and/or debt-GDP ratio for OECD countries?|
|8||Can top decision makers in financial authorities accept gifts and are they required to disclose their private interests?|
|9||In which countries can citizens follow the money spent on government contracts?|
|10||Why don’t citizens use the Internet more in their contact with governments?|
|11||How widespread is outsourcing in governments?|
|12||How much are unions involved in government restructuring in OECD countries?|
|13||How much do governments spend on promoting innovation?|
|14||What types of information are most commonly made available by governments?|
|15||Which governments in the OECD area are the most politicised?|
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Government at a Glance presents compensation data for occupations in three main areas of the public sector: education, health and the core public administration. Data are provided for teachers; salaried doctors and nurses; and senior managers, middle managers, professionals, and secretaries working in core ministries of central government. Compensation is defined slightly differently for occupations in each of these three sectors, based on data availability and reflecting the main characteristics of their compensation systems.
An analysis of the compensation data reveals that:
No. The table below summarises the different methodologies used for each occupational group.
|Teachers||Doctors and nurses||Central government public administration occupations|
|Statutory Wages and Salaries||Statutory Wages and Salaries||Statutory Wages and Salaries|
|Income taxes payable by employee||Income taxes payable by employee||Income taxes payable by employee|
|Employee social contributions||Employee social contributions||Employee social contributions|
|Extra formal salary payments (e.g. bonuses, payments for overtime or night shifts)||Extra formal salary payments (e.g. bonuses, payments for overtime or night shifts)||Extra formal salary payments (e.g. bonuses, payments for overtime or night shifts)|
|Employer’s social contributions||Employer’s social contributions||Employer’s social contributions|
|Working time correction||Working time correction||Working time correction|
Teachers’ compensation is defined the most narrowly as gross statutory salaries, which include income taxes but exclude employer’s contributions to social security and pension. Statutory salaries are the most basic building block of compensation systems, and are set by official pay scales. For doctors and nurses, gross annual income is presented. This includes their salaries (including any extra formal payments), social security contributions payable by the employee and income taxes payable by the employee, but excludes employer’s social security contributions.
Examples of extra formal payments include bonuses and payments for overtime or night shifts. Data are not presented for self-employed doctors. For the central government occupations, total compensation is calculated which includes salaries (including any extra formal payments), income taxes payable by the employee, social contributions paid by the employer and employee, and a correction for differences in hours worked (including holidays) across countries (see Q3 for a more complete description of total compensation).
Compensation packages include wages and salaries, benefits (e.g. child care, health care and pensions) and working conditions (weekly hours and paid holidays). Total compensation looks at all of these factors to enable more complete comparisons across countries. It shows how countries differ in the way they organise the structure of their compensation through relatively more or less emphasis on salaries compared to employers’ social contributions for the various occupations. Total compensation can also show the attractiveness of the public sector as an employer relative to the private sector, since workers consider working conditions and benefits–in addition to salaries–when deciding where to work or what position to accept.
Specifically, total compensation, which is calculated for the four central government occupations, covers both gross salaries and employer’s social contributions. Gross salaries include income taxes as well as the value of any social contributions the employee receives. Salaries can be paid in various ways, such as via basic salaries (e.g. as set out in salary scales, also known as statutory salaries) and/or via allowances, gratuities and bonuses (also called “extra formal salary payment”). Employer’s social contributions are those that are paid by the employer to social security funds or other employment-related social insurance schemes to secure social benefits for their employees (e.g. for future pensions or health and disability benefits). The compensation data also include social benefits that are paid through the state budget rather than through employer’s social contributions (mostly for some pensions in pay-as-you-go pension systems).
Comparability is ensured by several means:
Despite these steps taken to ensure comparability, some limitations remain. First, not all countries were able to exactly match the standardised definitions used for occupations. This means that the responsibilities behind each occupational title are not always fully comparable across countries. The survey on compensation for selected central government public administration occupations built on the International Standard Classification of Occupations (ISCO) to standardise jobs. However, some countries do not classify their data using ISCO, in which case they did their best to match their occupations to the ISCO definitions.
Second, comparative problems were encountered in the calculation of employer’s social contributions, especially in factoring in unfunded pension liabilities in some countries.
Finally, while purchasing power parities compensate for differences in exchange rates and in relative price levels, they do not take into account the higher costs of living in many capital cities. Indeed, the majority of central government employees are employed in capital cities, especially for the non service delivery occupations covered in Government at a Glance, and higher salaries in these countries tend to make up for those higher living costs. This may create distortions in countries where the cost of living is much higher in the capital city compared to the rest of the country (particularly relative to those countries where the difference is small).
The data indicate that central government staff in Chile work the most, at 2 048 hours per year. Central government staff in Portugal work the least relative to other OECD countries at 1 545 hours per year. On average in the OECD area, central government staff work 1 742 hours per year. At 40 hours per week, this is equivalent to about 42 days of public holidays and vacation combined per year.
Analysis in Government at a Glance 2011 indicates that the size of public expenditures and fiscal consolidation needs are unrelated: countries with both large and small governments (such as Denmark and Switzerland) have achieved fiscally sustainably positions. However, many of the countries with the lowest fiscal consolidation need (e.g. Australia, Chile, Finland, Korea, Norway, Sweden, Switzerland) reformed their budgeting systems earlier on following financial crises in the 1990s and 2000s. Such reforms made it easier for these countries to limit public expenditure increases during the good times, so that they have more financial leeway during economic downturns. The OECD is currently studying the institutional features of budgeting systems shared by the best performing countries.
OECD calculations reveal that several member countries will need to either reduce public spending or raise taxes by the equivalent of 5-8 percent of their potential GDP in order just to stabilise their public debt by 2026. The (unweighted) average need for OECD countries is about 3.6% of potential GDP. However, in order to reduce their public debt to more sustainable levels, many countries will have to go much farther. The ‘right’ level of public debt depends on a number of factors including national savings, growth prospects and political will. Government at a Glance seeks to feed this national discussion by showing governments, citizens and other stakeholders the extent of the fiscal need for their country and how they compare with other OECD members.
More OECD countries prohibit the acceptance of gifts by financial authorities than by members of the Executive and Legislature. In 23 OECD countries, financial regulators are either prohibited from receiving gifts (10 countries), or must disclose the gifts they receive to supervisors. In addition to gifts, financial regulators are most commonly required to disclose assets (22 countries) and outside positions (24 countries). However, despite concerns about “revolving doors” with private industry, few countries require regulators to disclose previous employment (12 countries). These disclosures are not usually made public. Only four countries make at least part of these disclosures available to the public for scrutiny: Korea, Mexico, the Netherlands and the United Kingdom.
Ten OECD countries have developed applications that allow the public to track public procurement spending on line: the Czech Republic, Chile, Estonia, Iceland, Korea, Mexico, Portugal, Switzerland, Turkey and the United States. As public procurement represents about 13% of GDP or about a quarter of all government expenditures, providing an adequate degree of transparency is critical to minimising the risk of fraud, corruption and mismanagement of public funds, and to levelling the playing field for businesses, thereby promoting competition. OECD member countries more frequently make information available about the pre-tendering and tendering phases of the procurement cycle, including laws and policies (always publicly available in 34 countries) and selection and evaluation criteria (21 countries). In comparison, fewer countries publish information about events that occur post-award, including tracking spending. Estonia, Iceland, Italy, Japan and Korea stand out as making the most types of procurement information available to the public.
Despite government efforts to facilitate their communication with citizens using ICTs, citizens are using e-government services much less than businesses. In 2010, on average 40% of citizens used the Internet to interact with public authorities compared with 80% of businesses. Data indicate that most citizens and businesses go to government websites to find information, but fewer use the websites to complete transactions. For example, on average 51% of businesses report using full case handling on line whereas only 23% of citizens report downloading forms, with even fewer (19%) sending forms.
The relatively higher uptake of e-government services by businesses could be linked to their better connection to broadband and that many government programmes either provide special incentives or make the use of digital communications compulsory. On the citizen side, older people and those living in rural areas – two groups who would benefit most from e-government –are less likely to use it, often due to access issues. However, data on broadband penetration reveal an uptake gap: many more citizens have access to the Internet than use e-government services. Governments can take steps to boost both supply and demand by ensuring that the services offered are easy to access and user-friendly, and by educating citizens on their availability.
In 2009, on average just over 20% of expenditures by central, state and local governments in OECD countries were used for outsourcing, amounting to 10.1% of GDP. The use of outsourcing by member country governments has been increasing since 2000, when it represented about 8.6% of GDP. There is large variation among the OECD countries in how much they use outsourcing, from 2.7% of GDP in Mexico to 19.4% of GDP in the Netherlands in 2009.
Governments can outsource the delivery of government services in two ways. First, they may purchase goods and services from the non-government sector in order to use them as inputs into their own supply chain. For example, this can occur when governments use private contractors to provide support services or perform back-office functions. Secondly, governments may decide to pay a firm to deliver goods or services directly to the end user. Bus lines or home care provided by the corporate sector or non-profit institutions is an example of this kind of outsourcing. The first type of outsourcing is most prevalent across the OECD, although the use of non-government firms to provide services directly to end users has been increasing.
No central government in the OECD requires mandatory agreement with unions on restructuring. In fact, union agreement on most key public employment issues is not mandatory in the majority of OECD countries. Only 11 countries (33% of members) require mandatory agreement on salaries and benefits, and only 7 require mandatory agreement on working conditions (e.g. number of working hours). Comparatively more countries require consultation with unions on these issues, although sometimes on a voluntary basis. For example, unions must be consulted on restructuring in seven countries (the Czech Republic, Finland, France, Italy, Norway, Slovenia and Switzerland), and in an additional nine countries, consultation is voluntary.
In 2008, OECD central governments invested between 1% and 6% of their total budgets in R&D activities. However, through the OECD Innovation Strategy, we have learned that innovation does not just depend on investment in R&D or supporting science and technology, but on a plurality of other factors and the ability to bring them together in a comprehensive framework. Developing wide-ranging skills, formulating public policies that promote entrepreneurship and supporting the creativity of young innovative firms are equally important. Government’s ability to conduct strategic foresight and leadership (chapter IV) plays a key role in developing and implementing successful innovation strategies.
The most common types of information proactively published by central governments include general information on the structure and function of government institutions (30 countries), budget documents (30 countries) and annual reports (27 countries)—information designed to promote accountability and reduce the transaction costs of working with government. While some governments are required by law to publish this information, many more are routinely providing it to citizens as part of their programmes on transparency. In comparison, only a small number of countries (9) proactively publish lists of public servants and their salaries.
The level of politically influenced turnover is one indication of the extent to which politics and/or political affiliation plays a role in staffing the civil service. As expected, the group with the highest turnover is advisors to Ministries’ leadership who are often appointed by the Minister. Notwithstanding advisors, the Czech Republic, Hungary and Turkey experience the most politically influenced turnover: all positions change systematically in the two top echelons of senior civil servants after the election of a new government in these countries. Korea and the Slovak Republic also experience relatively higher politically influenced turnover with all public service positions in the top echelon (below advisors) changing with a new government. Eleven member countries surveyed do not experience any politically influenced turnover in the top levels of senior civil servants: Australia, Austria, Canada, Denmark, Estonia, Ireland, Japan, New Zealand, Norway, Sweden and the United Kingdom.
Political influence in senior staffing may increase strategic agility in government, but can also indicate tendencies towards patronage and favouritism that undermine good governance.
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