The culture of bonuses in the public sector
Discussion
When i was a kid there was a culture of bonuses, of course there was, despite what people may think. It was people who worked for banks or sales people in companies where they had made a definite contribution to the bottom line of the company. Sometimes at Christmas everyone would get a token amount as thanks for their contribution.
This was pretty much the case until, as far as I can work out, the mid 1990s. at that point corporate mentality seemed to make a massive shift, certainly when it came to senior staff.
No longer was it people being rewarded a token amount, even if they were head of HR and therefore a cost centre rather than a profit centre. No everyone was entitled to a "bonus" as part of their package.
So whats wrong with that I hear you say. Well nothing really. Well Except the bonus was no longer being awarded just for a marked increase in performance or profitability or as a substitute for comparatively low salaries (bankers despite rumours are actually paid relatively low salaries by some corporate standards)
so every Tom Dick or Harry ended up getting paid a bonus whatever happened.The discretionary element for execs in particular seemed to get thrown out of the window.
So what. well in fact while it created a wage spiral that was impossible to stop this was to a large extent the problem of the companies themselves. It was their boards and shareholders who should have dealt with this if they felt it was a problem. they didn't though as it was felt that paying these bonuses encouraged retention of star performers (another myth carried over from banks)even if that star performer turned out to be more a star that was turning supernova
So bonuses became an obligatory extra. And what's good for the corporate sector is good for the public sector, or so El Gordo thought.
So now we have a BBC that pays bonuses to its top execs even thought they are already on the sort of salaries that make bankers look poor and also work for what is a non-profit organisation. Did Lord Reith pay himself a bonus and huge salary for doing a job he felt privileged to have?
We have Head teachers being paid bonuses for reviving failing schools, even though its a profession that shouldn't be attracting people based upon how much they can earn, and doesn't make any profit from which to pay out these bonuses.
We have councillors who are paid bonuses for what is effectively a voluntary job, with perks. stand up Tower Hamlets exec.
And railway execs get paid large bonuses for doing their jobs, adequately and no more.
Now this is our money and I do care where that goes so when did this all start and can we put things back to a position where people were paid a salary and that was it? thing is i know the genie is out of the bottle, so what can we do?
This was pretty much the case until, as far as I can work out, the mid 1990s. at that point corporate mentality seemed to make a massive shift, certainly when it came to senior staff.
No longer was it people being rewarded a token amount, even if they were head of HR and therefore a cost centre rather than a profit centre. No everyone was entitled to a "bonus" as part of their package.
So whats wrong with that I hear you say. Well nothing really. Well Except the bonus was no longer being awarded just for a marked increase in performance or profitability or as a substitute for comparatively low salaries (bankers despite rumours are actually paid relatively low salaries by some corporate standards)
so every Tom Dick or Harry ended up getting paid a bonus whatever happened.The discretionary element for execs in particular seemed to get thrown out of the window.
So what. well in fact while it created a wage spiral that was impossible to stop this was to a large extent the problem of the companies themselves. It was their boards and shareholders who should have dealt with this if they felt it was a problem. they didn't though as it was felt that paying these bonuses encouraged retention of star performers (another myth carried over from banks)even if that star performer turned out to be more a star that was turning supernova
So bonuses became an obligatory extra. And what's good for the corporate sector is good for the public sector, or so El Gordo thought.
So now we have a BBC that pays bonuses to its top execs even thought they are already on the sort of salaries that make bankers look poor and also work for what is a non-profit organisation. Did Lord Reith pay himself a bonus and huge salary for doing a job he felt privileged to have?
We have Head teachers being paid bonuses for reviving failing schools, even though its a profession that shouldn't be attracting people based upon how much they can earn, and doesn't make any profit from which to pay out these bonuses.
We have councillors who are paid bonuses for what is effectively a voluntary job, with perks. stand up Tower Hamlets exec.
And railway execs get paid large bonuses for doing their jobs, adequately and no more.
Now this is our money and I do care where that goes so when did this all start and can we put things back to a position where people were paid a salary and that was it? thing is i know the genie is out of the bottle, so what can we do?
Well ok I agree with all of that. Just looking at the underlying problem though. These bonuses crept in because the public sector has become the place where you go to underperform as the norm. There are some real tossers in the public sector as well as some great people. The notion of bonuses is a substitute for the sackings that were really needed. We need to scrap the quangos completely they are not a solution to public sector underdelivery. We have a lot of roads to buid. redeploying the tossers to the stae funded road gang is the way forward IMO. IE dont scrap the bonus, scrap the department.
Jasandjules said:
I don't see why people in the public sector should not get a bonus BUT it should be for outstanding performances etc. not for simply doing their job.
If you get a bonus it has to be for something outstanding. And it has to be proportionate to the turnover of the organisation, so paying someone at a school £200k plus salary is simply absurd for example. Schools do not after all MAKE any money, or shouldn't. How about the equivalent of a free holiday rather than a free house?and don't get me started on how insane all senior exec salaries have got.
TheFlyingBanana said:
Being a headteacher is one of the most difficult, stressful, responsible and skilled jobs there is. A good headteacher deserves serious money.
You are talking about a good headteacher. A lot of them just f
k around in their offices drinking coffee and delegating everything.At my last school, I spoke to my head personally twice. At my interview and when I handed my notice in.
Really, you are not talking the average pubic sector job here. I am talking about workshy bulls
tters that get out of the classroom to push paper and spend more time "away" from the job. TheFlyingBanana said:
Being a headteacher is one of the most difficult, stressful, responsible and skilled jobs there is. A good headteacher deserves serious money.
and a crap one deserves sacking. don't see much of that though, infact don't see much sacking in the public sector at all.Mikeyboy said:
If you get a bonus it has to be for something outstanding. And it has to be proportionate to the turnover of the organisation, so paying someone at a school £200k plus salary is simply absurd for example. Schools do not after all MAKE any money, or shouldn't. How about the equivalent of a free holiday rather than a free house?
Outstanding teachers derserve a bonus, they educate people, i can't think of many things that are as valuable to society..Mikeyboy said:
No longer was it people being rewarded a token amount, even if they were head of HR and therefore a cost centre rather than a profit centre. No everyone was entitled to a "bonus" as part of their package.
It is a blinkered approach to business to think that a cost centre does not necessarily contribute to overall profit.bga said:
Mikeyboy said:
No longer was it people being rewarded a token amount, even if they were head of HR and therefore a cost centre rather than a profit centre. No everyone was entitled to a "bonus" as part of their package.
It is a blinkered approach to business to think that a cost centre does not necessarily contribute to overall profit.
Yes!
Your company markets a killer product which wipes the floor with the competition, does the HR department who recruited talented designers not deserve recognition? What about the engineers who designed it? What about the IT dept who take care of the systems it was designed on?
Sure, the salesman might have closed the deal, but there is a whole chain of people who made it happen.
Mikeyboy said:
Jasandjules said:
I don't see why people in the public sector should not get a bonus BUT it should be for outstanding performances etc. not for simply doing their job.
If you get a bonus it has to be for something outstanding. And it has to be proportionate to the turnover of the organisation, so paying someone at a school £200k plus salary is simply absurd for example. Schools do not after all MAKE any money, or shouldn't. How about the equivalent of a free holiday rather than a free house?School are not there to make money. They are there to educate children and a headteacher that takes a failing secondary school and makes it into a success is worth every penny of £200k.
gamefreaks said:
bga said:
Mikeyboy said:
No longer was it people being rewarded a token amount, even if they were head of HR and therefore a cost centre rather than a profit centre. No everyone was entitled to a "bonus" as part of their package.
It is a blinkered approach to business to think that a cost centre does not necessarily contribute to overall profit.Yes!
Your company markets a killer product which wipes the floor with the competition, does the HR department who recruited talented designers not deserve recognition? What about the engineers who designed it? What about the IT dept who take care of the systems it was designed on?
Sure, the salesman might have closed the deal, but there is a whole chain of people who made it happen.
mikeyboy said:
We have Head teachers being paid bonuses for reviving failing schools, even though its a profession that shouldn't be attracting people based upon how much they can earn
bluetone said:
If money is your main driver, work in the private sector.
Nonsense: we can't rely on altruism to attract decent people into important public sector roles. Talented people want to be paid well and I for one want talented people working in the public sector (teacher's, politicians, doctors......) - that means they've got to be paid adequately. Bonuses? Maybe, maybe not, but suggesting that you don't need to pay them adequately is pretty naive.Mikeyboy said:
So now we have a BBC that pays bonuses to its top execs even thought they are already on the sort of salaries that make bankers look poor
We have Head teachers being paid bonuses for reviving failing schools, even though its a profession that shouldn't be attracting people based upon how much they can earn, and doesn't make any profit from which to pay out these bonuses.
I know it's an overused statement here, but this could have come straight from the lips of the Green Eyed Monster. Your whole post comes across as a whine that people other than those like yourself should be well payed.We have Head teachers being paid bonuses for reviving failing schools, even though its a profession that shouldn't be attracting people based upon how much they can earn, and doesn't make any profit from which to pay out these bonuses.
For a site like PH which is very keen on material success, begrudging people their personal wealth is very odd.
fb2 said:
Nonsense: we can't rely on altruism to attract decent people into important public sector roles. Talented people want to be paid well and I for one want talented people working in the public sector (teacher's, politicians, doctors......) - that means they've got to be paid adequately. Bonuses? Maybe, maybe not, but suggesting that you don't need to pay them adequately is pretty naive.
People work in the public sector for an easy life and cushy guaranteed pension; fair-do's if that's your gig. If you are truly talented and want to earn more, you'll work in the private sector. To suggest otherwise is naive.bluetone said:
fb2 said:
Nonsense: we can't rely on altruism to attract decent people into important public sector roles. Talented people want to be paid well and I for one want talented people working in the public sector (teacher's, politicians, doctors......) - that means they've got to be paid adequately. Bonuses? Maybe, maybe not, but suggesting that you don't need to pay them adequately is pretty naive.
People work in the public sector for an easy life and cushy guaranteed pension; fair-do's if that's your gig. If you are truly talented and want to earn more, you'll work in the private sector. To suggest otherwise is naive.bluetone said:
scorp said:
Outstanding teachers derserve a bonus
No, they deserve recognition/promotion certainly but the public sector should not be operating in this way. IMHO.If money is your main driver, work in the private sector.
Edited by scorp on Monday 29th June 02:24
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