Civil servants will not receive any mid-year Annual Variable Component (AVC) this year in view of the uncertain economic outlook.

Their pay is pegged to pay levels in the private sector and the AVC is a component in the flexible wage structure that is adjusted to reflect economic conditions.

The government's decision is in line with the recent National Wages Council (NWC) recommendations. The zero mid-year payment, together with cuts made previously, will see annual civil service salaries in 2009 drop by 6% to 21% compared to 2008, with those in senior positions receiving the largest reduction.

According to a statement issued by the Public Services Division of the Prime Minister's Office, the government will decide on the year-end payment for civil servants when Singapore's economic performance in the second half of 2009 is clearer.