Singapore — Law and Home Affairs Minister K Shanmugam has called People’s Action Party colleague Koh Poh Koon’s comments against a minimum wage “commonsensical” and said that S$1,300 should not be the goal for any minimum wage.
Mr Shanmugam made the comments in a Facebook post a day after the Progressive Wage Model-minimum wage debate in Parliament on Oct 15 between PAP MPs and those from the Workers’ Party, led by party chief Pritam Singh.
Dr Koh, who is Senior Minister of State (Health) and Deputy Secretary-General of the National Trades Union Congress, disagreed with the WP’s proposal for a minimum wage set at a base of S$1,300 and advocated strongly for the Government’s Progressive Wage Model.
The PWM has been dubbed “minimum wage plus” by PAP politicians since it takes a sectoral approach to raising the wages of each industry’s lowest-paid workers. The WP, however, maintains that the PWM is taking far too long to implement and has left a significant number of low-income workers in the lurch.
Dr Koh told the House that the minimum wage proposal could become politicised and potentially leave businesses and workers worse off. Saying that it is difficult to set the right level of universal minimum wage, he said an amount that is too low would “defeat the purpose” of such a policy and an amount that is too high would cause businesses to pass the higher costs to consumers, axe staff, or even close.
The PAP politician said that the vast majority of about 850,000 workers who are employed in traditionally low-income jobs, such as service staff, cleaners and clerks, earn above S$1,300 a month.
He added that about 100,000 workers earn below S$1,300, including about 25,000 who are self-employed and would not benefit from a minimum wage. After Workfare disbursements and Central Provident Fund contributions by employers, 56,000 workers — 32,000 of whom work full-time – earn less than S$1,300 each month.
Referring to these figures, Mr Shanmugam backed Dr Koh’s arguments and said in his post: “There have been suggestions that we should have a Minimum Wage in Singapore, of S$1,300 pm. SMS Koh Poh Koon made some good commonsensical points, backed up by numbers.”
Asserting that implementing a S$1,300 base salary should not be the goal, the minister added: “The best way to continue helping low-wage workers is by expanding PWM to certain sectors, and getting them to retrain, so that they take on higher skilled, better paying work.
“And also very important – we can’t have S$1300 as our goal. We have to actively work to push up the salaries of those earning more than S$1300 – say, for example, those earning S$1400 (and more). Upgrade them, get them to earn more. That is what the Committee will be seeking to do.”
[Progressive Wage Model or Minimum Wage ]There have been suggestions that we should have a Minimum Wage in Singapore,…
In response to Dr Koh’s arguments in Parliament, Mr Singh had questioned why the Government was taking so long to cover these workers. He had asked: “Can we not consider how we can cover them now immediately because it’s not a small number? If you think of 60,000 rental units available from HDB, and you compare that with this number … it’s quite a lot of Singaporeans who need some help.”
He added: “I don’t think it is acceptable that anyone, any Singaporean, is earning below this number. It is simply not acceptable.”
On how long it will take to help the workers who are left in the lurch by the time it takes to expand the PWM, Dr Koh said: “I think the process will be something that we will want to do now, talk about it, discuss it, work out some schematics, but when can we implement?”
Referring to the ongoing financial downturn, he added: “Obviously we have to look at the economic situation as well, because this will probably be the wrong time to push for increased wage cost onto our SMEs, who are already suffering.” /TISG
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