Wage Limits Set for State Officials in Venezuela

Mérida, February 15th 2011 (Venezuelanalysis.com) – Yesterday Comptroller Clodosvaldo Russian announced that the Comptroller General of the Republic will begin evaluating the wages of senior Venezuelan officials from January next year.

The evaluation will be made within the framework of the Salaries, Pensions, and Retirement of Senior Officials of Public Power Law passed by the National Assembly in December last year and valid from 12 January this year, when it was published in the official gazette.

The law sets wage limits and regulates high state officials’ conditions and benefits, and also sets punishments for violation of the law.

“All public servants are under the obligation to not receive remunerations higher than what is established in the law,” Russian said.

Articles 8 to 13 of the law outline what positions correspond to different salary levels, and the amount of pay for each level.

First level positions such as the president and vice president of the country, minister, the president of the national bank, and so on, can receive a maximum of twelve minimum wages.

The minimum wage per month is currently Bs 1,223.89 (US$ 284.62) and the government usually increases the minimum wage each 1 May. Pensioners receive one full minimum wage, and new teachers, for example, usually receive one to two minimum wages.

Hence, the highest wage for any public official, including the president of the country, would currently be US$ 3415 per month, or US$ 40,985 annually. The amount does not include end-of-year bonuses.

Second level positions, such as vice-ministers, university rectors, presidents of state companies, and others, will only be able to receive 10 minimum salaries. Governors will be able to receive up to 9, legislators, comptrollers, attorneys up to 8, mayors up to 7, and other public officials up to 5.

Additional income, such as commissions, is prohibited, and all pay is to be paid into the recipients’ bank account, in a state owned financial institution.

The national assembly report of the law motivated the various salaries levels as recognizing the different levels of “responsibility, duties, and abilities”. The idea of the law is also to centralise and make wage levels more uniform across the country.

State institutions should send pay roles to the Comptroller every year. Information about high official salaries, with exceptions made for security reasons, should be included in annual reports, and will therefore be available to the public.

“We hope not to have to implement sanctions. We’ll sanction both those who paid and who were paid more [than allowed],” Russian said.

Sanctions, outlined in articles 30 to 32, will apply to those public servants who receive more than their maximum salary. In that case, they must repay that money to the state, and they can also be disqualified from public office. The person responsible for the over-payment is subject to the same sanctions.

The law also outlines fines for providing false information regarding pay, taking too long to provide required information, paying salaries to private banks, and other similar things, with fines ranging from 50 to 500 tax units.

Bureaucracy and corruption are perceived by many, from both the opposition and the left, as among the biggest weaknesses of the current and previous Venezuelan governments.

Members of the public have often expressed discontent with what they perceive as excessively high salaries of some ministers.

Rafael Ramirez, president of PDVSA and minister for energy and petroleum, is rumoured to earn up to Bs 83,000 per month (US$ 19,302) according to private internet media Noticias Centro, and as little as Bs 10,700 per month (US$ 2488) according to Ramirez himself.

In March 2009 Chavez criticised the high salaries and other benefits of high officials, stating, “We have to get rid of these mega-salaries, mega-bonuses”. At that time, he signed a presidential decree setting wage limits for higher level public administration workers, prohibiting bonuses and eliminating superfluous and luxurious spending such as international travel, parties, and car purchase.