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Gov. Bill Haslam speaks to reporters after a jobs training announcement outside the state Capitol in Nashville, Tenn., on Wednesday, April 6, 2011. An Associated Press analysis of public records shows the new governor has boosted pay for his commissioners. (AP Photo/Erik Schelzig)

ERIK SCHELZIG, Associated Press

NASHVILLE, Tenn. - Republican Gov. Bill Haslam has increased how much his agency heads earn compared with what their counterparts made in the administration of his Democratic predecessor, an Associated Press analysis of public records has found.

Haslam, who has proposed a 1.6 percent raise for state employees, has increased the minimum pay for commissioners by 11 percent to $150,000. The raises come as Haslam seeks to eliminate nearly 1,200 government positions to help cope with the $2 billion in federal stimulus grants ending in the upcoming budget year.

"It's my philosophy that in government we should probably have fewer people - but people that we pay better," Haslam told the AP in an interview on Wednesday.

Education Commissioner Kevin Huffman, who was sworn into office Tuesday, is the best-paid agency head. The former Teach for America vice president is making $200,000 per year, up $20,000, or 11 percent, from his predecessor in Gov. Phil Bredesen's administration.

Meanwhile, Safety Commissioner Bill Gibbons' nearly $178,000 salary is $43,000 more than his predecessor, a 32 percent increase. Gibbons during last year's gubernatorial contest endorsed Haslam after giving up his own bid for the Republican nomination..

"The governor is working to transform state government, and in order to do that he has attempted to make salaries more market comparable across state government," Gibbons said in a statement.

Haslam, who does not accept his $170,000 salary from the state, said the increases reflect the emphasis he's placing on education and public safety. He said Gibbons has more responsibilities than his predecessor because he's also heading a multi-agency initiative to reduce crime in Tennessee.

Huffman made about $230,000 with Teach for America in 2009, according to the nonprofit organization's latest federal tax filing, while Gibbons made about $144,000 in his previous job as chief prosecutor in Shelby County.

The state salary changes come as a surprise to House Democratic Caucus Chairman Mike Turner of Nashville, who said the governor should have informed legislative leaders that he intended to raise salaries for Cabinet-level positions.

"I'm somewhat shocked about it," he said. "It's tough times; a lot of people are hurting."

Haslam acknowledged that increasing his top aides' pay could lead to criticism. But he noted that all of his agency heads have all been told to make cuts, so ultimately the state will be spending less.

"Every one of those commissioners is going to end up saving the state a whole lot more money than the small incremental cost of their salary," he said.

Commissioner pay was last increased in 2007 during the Bredesen administration, when the salary range was set between $135,000 and $180,000. Bredesen also moved the head of the of economic development agency to the top compensation tier, a move that represented a 63 percent pay increase for then-Commissioner Matt Kisber.

Bredesen at the time called the increases a "perfectly reasonable thing to do," and argued that the previous salary levels were artificially depressed because of political considerations. Bredesen said he was willing to take the heat for the pay hikes to keep key commissioners on staff for the duration of his second term - and to give his successor an easier time assembling a Cabinet.

Haslam echoed those sentiments on Wednesday.

"In government we're never going to pay what they do in the private market," he said. "But if we're going to attract great people, we're going to have to at least make it comparable."

When Bredesen increased pay for his agency heads, 38 other officials in the executive branch received raises because their salaries were tied to commissioners' earnings. Haslam spokesman David Smith said no similar hikes occurred this year, with the exception of Tennessee Bureau of Investigation Director Mark Gwyn, whose pay jumped the same 32 percent as Gibbons'.

Gwyn now earns $178,596 a year, up $43,596 from what he made last year.