President John Dramani Mahama has announced the establishment of an Independent Public Emoluments Commission (IPEC) intended to replace the Fair Wages and Salaries Commission (FWSC), aiming to establish a more coherent, transparent, equitable, and sustainable system for public sector remuneration, including pay within state-owned enterprises (SOEs). The decision comes as part of a broader strategy to enhance consistency and transparency within the public sector, particularly concerning executive compensation. The Fair Wages and Salaries Commission (FWSC) has already been engaged in consultations with Organized Labour regarding the proposed replacement, recognizing the need for a fundamental shift in how public sector salaries are determined. President Mahama emphasized that executive compensation cannot be determined in isolation from institutional performance, reflecting an enterprise’s financial position, productivity, achievement of agreed targets, service quality, and the value it creates for the state. He stated that board chairpersons, chief executives, managing directors, and management teams of SOEs and other specified entities will be required to cooperate fully with SIGA and the Fair Wages and Salaries Commission during the transition, emphasizing the need for timely and accurate data submission on compensation, conditions of service, and financial performance, all compliant with approved remuneration arrangements. The President cautioned that the improvement, while encouraging, must translate into sustained operational efficiency and stronger performance. ‘You must not use profits that rightly belong to the Ghanaian people to finance the creature comforts of management and boards,’ he asserted, linking this to the need for greater dividends to the state rather than being absorbed by management and board benefits. Dr. George Smith-Graham, Chief Executive Officer of the Fair Wages and Salaries Commission, explained that the pilot program involving 15 institutions last year demonstrated the potential for improved performance indicators and cooperation from chief executives. He said a security engagement with all chief executives, led by Dr. Abdul Baset Bamba, is scheduled for September 25 to facilitate the transition process. President Mahama also called for greater discipline among boards of SOEs, warning board chairpersons against taking up full-time executive positions and reporting solely to oversight, while chief executives should respect legitimate board oversight. He emphasized that boards should provide oversight rather than take responsibility for routine operational decisions, and that a chief executive who resisted legitimate board oversight also undermined accountability through interference. The President’s remarks are part of a larger context within which the government is seeking to address challenges facing SOEs, including shifts in profitability and the need for greater efficiency and accountability within the sector.
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Source: Graphic Online
