What are the advantages and risks of salary top-ups? What is the potential impact of salary top-ups on corruption and anti-corruption? What aspects have to be considered related to integrity management and compliance?
1. Wages and corruption 2. Benefits and challenges of salary top-ups 3. Mitigating the corruption risks 4. References
Salary top-ups are a way to increase civil servant salaries. They can be used by governments to compensate for hardship jobs or increased workloads. Top-ups are also used by donors to retain local staff, that is, to keep staff committed to projects when other projects or the private sector might offer incentives to move on. The extent to which salary top-ups can be used as an anti-corruption strategy must be seen in the context of how salaries can reduce or increase incentives for corruption. Evidence in this regard remains largely inconclusive. There is, however, an emerging consensus that increasing salary may not be sufficient for reducing corruption, in the absence of effective controls and management of staff and resources.
Some studies show that salary top-ups are likely to be effective in low-income countries. Salary top-ups can also curb the misuse of per diems. Nevertheless, there are also a number of challenges posed by salary topups, including that they might prevent necessary civil service reform, can generate warranted and unwarranted perceptions of corruption due to differences in payment, and could undermine accountability and management.
If donors are inclined to use salary top-ups, steps can be taken to address these risks, including: harmonising donor practice, adapting to local conditions, strengthening transparency and information-sharing, creating robust management and accountability systems, offering in-kind/non-monetary benefits, and ensuring sustainability of the intervention.