Not acceptable for any S'porean to earn less than S$1,300 per month: Pritam Singh

Singh urged the government to move faster in helping low wage workers in Singapore.

Jason Fan | October 15, 2020, 09:36 PM

It is "not acceptable" for any Singaporean to earn less than S$1,300 per month, said Leader of the Opposition Pritam Singh in Parliament on Thursday (Oct. 15).

This was in response to Senior Minister of State for Health Koh Poh Koon, who said that 32,000 workers continue to earn less than S$1,300 monthly, even after the Workfare Income Supplement (WIS).

"Moral imperative" to help SMEs?

Recently, members of the Workers' Party, including Singh, called for the government to consider implementing a universal minimum wage of S$1,300 in Singapore.

In particular, Singh called it a "moral imperative", and said that the Progressive Wage Model (PWM) is taking too long to help low wage Singaporeans, given that it only establishes a minimum pay for three specific sectors and does not help needy workers outside these sectors.

In response, Koh explained the potential downsides of minimum wage, and argued that the PWM has delivered superior results.

He also asked Singh in Parliament to clarify the WP's stance on the minimum wage's effects on SMEs, given that in most developed countries, the legal minimum wage applies to all workers, including migrant workers.

He brought up the fact that if foreign workers have to be paid the same minimum wage of S$1,300, SMEs may be in danger of being unable to afford their staff.

Koh said that many companies, especially those in the construction sector, are suffering and not yet out of the woods.

"If businesses cannot bear the resulting costs, is there also a moral imperative to help our SMEs? This is a particularly pertinent consideration at this time, when we are in a deep Covid-19 crisis," said Koh.

Minimum wage would not significantly impact SMEs: Pritam Singh

In response, Singh said that he does not believe that adopting a minimum wage would significantly impact SMEs.

He also stated that WP's proposed minimum wage does not include foreign domestic workers or foreign manpower at this point, given that there are various foreign worker quotas and levies that are currently in place.

Singh said that he understands such measures are in place to serve specific purposes, but argued that the government should still swiftly implement a minimum wage.

"I think you'll have to implement this, and see how best to work the overall manpower situation that SMEs demand, and what the economy demands," said Singh.

32,000 workers is "not a small number"

This urgency, according to Singh, is due to a key figure revealed in Koh's speech, namely the 32,000 workers who earn less than S$1,300 monthly.

Singh noted that this is "not a small number" of workers who are earning below the WP's proposed minimum wage, and reflects a significant number of Singaporeans who need help.

He emphasised that his Facebook post was not meant to dismiss the PWM, but rather to urge the government to act faster in helping these 32,000 low wage workers, representing 1.7 per cent of the local workforce.

Singh said that he is prepared to work with Koh to ensure that the government can reach out to these Singaporeans as quickly as possible, given their circumstances.

"Because I don't think it is acceptable that anyone, any Singaporean is earning below this number. It is simply not acceptable. And if we can do something about it in double quick time, let's do it," said Singh.

Many practical considerations for implementing minimum wage

Following up, Koh said that the figure of 32,000 is "not very clean data", as it includes people across different occupations.

These include people who may be technically employed, such as a hawker assistant who is helping parents manning a stall, and may be "happy" drawing a salary of just S$700.

This makes implementing a minimum wage difficult, argued Koh, since there are many such practical considerations.

"Research, reams and reams of data and research is good, but in practice it's always harder to do," said Koh.

He also said that a negotiated approach with stakeholders remains the best approach, given that a balance can be struck between workers and businesses.

Koh also said that the PWM only applies to Singaporeans, meaning any increase in the PWM will only benefit Singaporeans, which is "good news".

However, given that in many developed countries, a blanket minimum wage across all sectors would include foreign workers, Koh warned that the government must be careful in considering such a scheme, as a minimum wage increase would have more implications than an increase in PWM.

Supporting minimum wage and helping SMEs not mutually exclusive

Jamus Lim, the WP MP for Sengkang also jumped in, and thanked Koh for his "impassioned defence" of the PWM.

However, he warned Koh that it is important not to rely on "folksy wisdom" and "beliefs by labour union leaders", given that there are many studies which extol the merits of a minimum wage.

He said that studies show that the minimum wage does not lead to any appreciable increase in unemployment, and said that this is based on evidence, rather than just belief. He added that evidence from "countries all over the world" show that a minimum wage has "minimal impact" on unemployment, as long it is not set too high.

Lim suggested establishing an independent wage board, comprising of academics, representatives from the labour movement, and employers to come up with minimal wage figures, in order to avoid the risk of politicising the issue.

He also said that he doesn't think supporting a minimum wage is "exclusive" from SMEs, addressing Koh's earlier point about the impact of a minimum wage on SMEs. He said:

"In fact, I would just remind everyone that Henry Ford, who invented the automobile, understood this. He said he has to pay his workers enough, so that they can buy his cars. So when we pay our workers enough, it's not our small businesses end up suffering as a result."

Related Story

We deliver more stories to you on LinkedInMothership Linkedin

Top image via