Furious exchanges in Parliament over 28% pay rise for top civil servants

There were furious exchanges in Parliament yesterday as the GSD sought justification from the Gibraltar Government for a 28.21% pay increase that had pushed the salaries of Gibraltar’s two top civil servants to £157,978.

Opposition MP Roy Clinton said the increases awarded to the Chief Secretary and the Principal Auditor flew in the face of a crackdown in other countries on so-called ‘fat cat’ salaries.

It was also in sharp contrast to a 2.75% increase across the public sector and minimal inflationary increase in the private sector, and meant the top civil service salaries amounted to nearly six times the annual pay in Gibraltar.

“What is the merit for this 28% pay rise in this day and age?” Mr Clinton asked as he presented a motion on the subject.

He drew a scathing response from Chief Minister Fabian Picardo, who said the increase stemmed from a decision taken by the GSD in 2004 to appoint Dr David McCutcheon as chief executive of the Gibraltar Health Authority on a salary of £106,000, a 104.6% increase over the salary of the person he was replacing.

That appointment had a knock-on effect because the GSD had previously agreed with the civil service that the highest paid public servant would be the Chief Secretary, by a differential of 4%.

Not only that, it had been historically agreed by successive administrations that the Principal Auditor’s salary should be pegged to that of the Chief Secretary.

Mr Picardo said the current holder of the Chief Secretary’s post had “honourably” waived the 4% differential, but that the 28.21% increase was the result of the GSLP/Liberal administration giving effect to a historical agreement reached under the GSD administration.

He said the increase was “personal to holder”, meaning the salary will go down for the next person in the post. Both current post holders are set to retire soon.

Mr Picardo said the government had also taken steps to reduce the salary of the GHA chief executive and was in fact doing away with the post.

The GSD, Mr Picardo added, had laid “Hansel and Gretel-like trails of treats and largesse and excesses” that his government was now undoing.

And the Chief Minister had stern words for Mr Clinton, who he accused of an “unveiled imputation of ill motive to senior civil servants”.

“He has declared himself today an enemy of the civil service,” Mr Picardo told Parliament.

“Most of the people I know are on very low salaries.”

“None of them disrespect the Chief Secretary in the way he has today.”

Mr Picardo amended Mr Clinton’s motion by replacing it entirely with a text that set out the government’s position on this issue and criticised the GSD’s handling of pay in the past.

The amended motion was approved by government majority, but the arguments carried little weight on the opposite bench.

Independent MP Marlene Hassan Nahon declared herself “flabbergasted by the spin” and complained that there had been no explanation as to why the increase was justified.

“Who cares what the chief executive of the GHA got?” she asked. “That was then, this is now.”

GSD MP Trevor Hammond also waded in and slammed the “utterly obscene” pay rise, adding “people have a right to know”.

Mr Clinton also hit back and insisted that the Chief Minister’s explanation amounted to “wage inflation driven by jealousy”.

“There is no merit in it, all there is is relativity,” Mr Clinton said, adding: “He gets more, I want more.”

“The tax payer does not live in this world. What world are they living in?”

And he added: “If they are so unhappy, let them leave, frankly.”

“If they are not happy with their salaries, let them get a job in the private sector and see how much they earn.”

Mr Picardo repeated that his government was merely giving effect, on a personal to holder basis, to historical agreements reached with the civil service under the GSD.

He said his administration had taken steps to reduce the salaries in question for new post holders and had done away with the post of chief executive in the GHA, a role which had “added cost but no frontline medical benefit”.

Since he became Chief Minister, Mr Picardo added, the minimum wage had increased by 15% and public sector salaries by 14%.

He insisted that Mr Clinton was “agitating on salaries” to cause rebellion in the civil service.

Mr Clinton, who had moved the original motion, had the last word and said he believed top civil service salaries should be set by an external body using benchmarks linked to comparable private sector jobs.

He insisted that the key underlying point in his defeated motion had been to seek justification for the salary increase. That had justification had not been provided, he said.

“What is it that they are going to do for the taxpayer to justify this pay increase?” Mr Clinton asked.

And he insisted that this was neither a personal attack on the post holders nor on the public sector as a whole.

“I have not attacked the civil service,” he said.

“What I have attacked is a lack of meritocracy at the top of the civil service.”