In view of the unprecedented economic crisis brought about by COVID-19, the Public Service Division (PSD), in consultation with public sector unions, has decided that all civil servants will not receive a mid-year Annual Variable Component (AVC) this year.
The PSD made the announcement in a press release on 18 June 2020.
COVID-19 has taken an unprecedented toll on the global economy.
On 26 May 2020, the Ministry of Trade and Industry (MTI) further downgraded its 2020 GDP growth forecast from “-4 per cent to -1 per cent” to “-7 per cent to -4 per cent”.
The labour market also showed further signs of weakening as resident and citizen unemployment rates continued to rise in March 2020, and retrenchments rose over the first quarter.
Against a worsening economic outlook, the public service says it stands in solidarity with the rest of the nation during this difficult period.
The decision to remove the mid-year AVC took into consideration the recommendations made in the National Wages Council (NWC) release in March 2020, calling for employers and employees to do their part, with management taking the lead, in helping to reduce costs and save jobs.
The Government will continue to monitor the economic situation closely, taking into consideration the NWC’s recommendations to give special consideration for lower wage workers for this year’s year-end AVC, said PSD.
NTUC Deputy Secretary-General Cham Hui Fong supported the move, stating: “The National Trades Union Congress supports the Public Service Division in putting a difficult but necessary pause on the mid-year annual variable component (AVC) due to the grim economic conditions in the first half of 2020.
“In such difficult times, we also recognise the efforts of senior leadership in public service who are taking the lead and a deeper cut in cost reduction.”
In the release, the Government gave its appreciation to public officers who worked hard and made sacrifices in the fight against COVID-19, including those working on the frontline and behind the scenes.
The Government will make different efforts to appreciate and recognise the good work of its officers.
Amalgamated Union of Public Daily Rated Workers (AUPDRW) General Secretary Raman Kathavarayan said: “We are heartened to see the Government’s efforts to recognise the sacrifices and work done by our civil servants who have also been at the forefront in battling Covid-19.
“Should our economy improve by end of this year, I sincerely hope that government could provide an additional monetary supplement for our low-wage employees working in the public sector as they have borne the deeper brunt of the pandemic.”
