Ex-WP MP and PSP member call for universal minimum wage

SINGAPORE: The time has come for a universal minimum wage to be implemented in Singapore, say Leon Perera and Lawrence Pek in a new essay.

Mr Perera is a former Workers’ Party Member of Parliament, while Mr Pek is a member of the Progress Singapore Party and a former secretary-general of the Singapore Manufacturing Federation. He has also announced his intent to contest in the upcoming General Election.

In the essay, published on Thursday (April 17) in the digital magazine Jom, the authors acknowledge the labour challenges Singapore faces, as well as the current global uncertainties of higher tariffs and trade barriers, which could further affect Singaporean workers.

In light of these, the Progressive Wage Model (PWM) introduced 12 years ago is now “outdated, narrow in scope, and exclusionary in nature” and no longer adequate, especially after the Covid-19 pandemic struck.

The workers for whom the PWM was formulated also have to face the reality of a world where technology may well replace them or, at the very least, disrupt their jobs.

Additionally, not all low-wage workers are covered under the PWM, which also does not “easily lend itself to uplifting the wages of gig workers, who are not formally employed,” the authors added.

Read also: Erasing history? CNA removes article on the late Lim Chong Yah’s call for minimum wage

As for the cash handouts and voucher programmes administered by the government, Perera and Wek believe that these do not address the issues of systemic unemployment and under-employment made worse by Singapore’s high living costs.

This affects not only low or middle-income workers but also, say, middle-aged PMETs who may find it difficult to stay employed amid the disruptions brought about by the increased pace of technology.

The authors argue that the best form of social welfare is “the creation of good, well-paying jobs, which ensure dignity and economic participation”. Thus, a universal minimum wage would incentivise work instead of causing people to be dependent on handouts.

They also outlined the advantages of such a minimum wage, which include helping bring more local workers into the workforce, leading employers to invest more in productivity, aiding in taking workers from a survivalist to an aspirational mindset, addressing inequality and underemployment, and helping Singapore’s heartland SMEs and micro-enterprises.   

Citing research, they also refuted the idea that a minimum wage destroys jobs and that it leads to higher inflation rates, as long as it is not set too high.

“It would uplift the lowest paid, plugging the gaps and shortcomings of the PWM. It would enable the worst-paid and most vulnerable workers to focus better on longer-term career planning, reducing the centrifugal force of social inequality in our society and reducing the need for ad hoc handouts at the taxpayer’s expense, handouts which could be prone to political abuse.

“A UMW would be simple to administer and easy for all stakeholders to grasp, making enforcement much more effective,” the authors added. /TISG

Read also: Singaporean asks: “What would a universal minimum wage model in SG do to our cost of living?”