Performance-Based Pay – a New (Mixed) Payment Scheme for Russian Civil Servants

Abstract

We have developed a fundamentally new approach to the provision of financial incentives (bonuses) to civil servants, which does not contradict the concept of new public management (NPM) and has a certain similarity with the corporate (Asian) performance-based type of remuneration system. In the context of our study, “performance” means socio-economic development of Russian regions. We develop and test our methodology in two successive stages: first, we carry out a retrospective assessment of the level of development of Russia’s constituent entities (according to regional statistics), and then we calculate the amount of bonuses paid to civil servants according to their performance. Based on the level of socio-economic development, we solve the problem of clustering of Russian regions with the use of neuromodeling. The prognostic function is implemented on the basis of neural network technologies (through the development of appropriate Bayesian ensemble of dynamic neuromodules). This is the basis for the application of collective material incentives for civil servants of L-type, since the calculation of performance-based bonuses for civil servants is based on a pre-developed (by expert evaluation) progressive scale (index of socio- economic development of Russian regions – level of bonus payments paid to civil servants). The approach to bonus payments for employees based on their performance, which we propose in the framework of our work, will help coordinate the work of ministries and agencies in Russia’ constituent entities by linking collective incentive payments to the level of socio-economic development of Russia’s regions. Besides, the application of this approach in practice will help strengthen the control of the target expenditure of Russian budget funds. The method is universal and in case of its adaptation (variation of the system of socio-economic indicators of development of the country’s regions) can be used in any country with a federal structure

Keywords

• socio-economic development
• evaluation of public administration efficiency
• constituent entities of the russian federation
• neuromodeling
• performance-based remuneration of civil servants
• progressive scale
• budget expenditures