Public service chief executives will no longer be given performance pay in an effort to “put the brakes” on the growth rate of their salaries, State Services Minister Chris Hipkins announced today.
The public chief executives were eligible to receive up to 15 per cent extra in a discretionary payment for exceptional performance.
The decision to end the performance pay could save up to $4 million by 2021/2022.
“International research shows that individualised performance pay is not an effective incentive for higher performance for complex roles such as these,” Mr Hipkins said.
Mr Hipkins said part of the agreement with the State Service Commissioner and chief executives was addressing pay levels across the public service.
“Part of this is paying women equally and addressing pay levels for public servants at the bottom and top end,” Mr Hipkins said.
“We have a plan to close the gender pay gap, we have introduced a living wage for all low-paid public servants and now we’re removing performance pay for chief executives.”