The government’s efforts to put a ceiling on public sector pay are useless and populist, says Barend van Lieshout.

The new law governing top incomes means the salaries of care bosses will also have to comply with the Balkenende norm. They are appealing and rightly so: the law is an inconsistent, useless, populist law which should never have come into being.

High-earning officials are not a popular breed. That is why this government has rushed this law through parliament. Care administrators will, over the next few years, earn less than 130% of a minister’s salary. And although care administrators are not civil servants and their organisations do not depend on subsidies, the law still applies to them.

Minister Ronald Plasterk has let it be known that as far as he is concerned care bosses are ‘obviously’ part of the public sector because ‘care is a public service financed from healthcare premiums’.

Definition

This is shoddy politics by former scientist Plasterk. The premium argument is a slim one and not very specific: insurers, pharmacists, manufacturers of compression stockings, electronic medical file suppliers are all financed from premiums and are not covered by the new law.

The minister’s definition of the ‘public sector’ is opportunistic to say the least. Energy companies, solicitors, systemic banks are at least as public as care institutions. Perhaps the minister is not very keen to tackle Bristol-Myers Squibb and RWE.

Things will get interesting when hospitals keel over. The government policy is that only ‘systemic hospitals’ will be supported financially. Are some hospitals less public than others?

Rationale

Apart from the randomness of this law, it also lacks an economic rationale. The hospital stakeholders couldn’t care less. Patients are not going to change hospitals because of the salary of the administrators. Care insurers could have made an issue of administrators’ salaries years ago. They didn’t because it wouldn’t deliver value for money.

Supervisory bodies have, time and again, chosen the better but more expensive candidates for the job. Were they all made up of weak numbskulls who were bulldozed by greedy administrators?

Experience

The CV of many a supervisor is a lot more impressive than that of the ministerial crew, and that includes hospitals where experienced administrators are dealing with incidents or unrest among medical staff. Good administrators are worth every penny they are earning.

The one stakeholder voice I haven’t heard is the financier’s. Banks which have lent millions to care institutions are familiar with the golden handcuffs: an incentive which makes it difficult for good administrators to leave. Would they be happy to have a generation of cheaper administrators responsible for paying back their loans?

The conclusion is clear: this law is a populist law. Maybe Plasterk secretly hopes the courts will make mincemeat of his law. It’s a shoddy piece of legislation, the product of rumblings in the underbelly of the house of representatives, which should never have been approved by the senate whose task, at least on paper, is to guarantee the quality of our legislation.

Barend van Lieshout is a healthcare advisor at Rebel (www.rebelgroup.com)