The amendment bill for Goods and Services Tax Voucher (GSTV) Fund has been introduced in Parliament on 5 March. The Bill seeks to expand the purpose of the GSTV Fund to help a person whether in need of relief from GST or not.
With the purpose of alleviating the impact of GST on living expenses, the proposed amendment to section 4(1)(a) of the Act would allow the GSTV Fund to provide financial assistance under a public scheme to “natural persons prescribed”, which means no longer limited to only those who are in need of relief from GST.
The type of assistance including cash grants, grants-in-aid, rebates, reliefs, subsidies, and credits.
In response to the amendment Bill, Nominated Member of Parliament (NMP) Anthea Ong on Thursday (26 March) raised her concern regarding the beneficiaries of GSTV Fund which she says should include all the low-income residents such as migrant workers.
As GST hikes impact all low-income residents, Ms Ong questioned why the policy is only eligible for Singaporeans, while asking, “Why expand the scope of beneficiaries to those who don’t need the relief when there are people in our midst who need it but don’t get it?”
Low wages of migrant worker
In Singapore, Ms Ong noted that most of the sectors such as construction, marine, manufacturing, and domestic work rely on an “enormous foreign workforce”.
“As of June 2019, there were 1.4 million foreign workers in Singapore. 70% of them were work permit holders. That’s about 17% of the population and 26% of our resident labour force,” she cited the statistics from the Ministry of Manpower (MOM).
However, she pointed out, “Low-wage migrant workers are most commonly employed in construction, shipyards, sanitation services, manufacturing, and domestic work. These industries touch the everyday lives of every Singaporean in one way or another.”
According to a survey of Transient Workers Count Too (TWC2), Ms Ong stated that the basic rate of a Bangladeshi migrant worker is $18 a day, which remains unchanged till today since 2004.
“This was largely consistent with HealthServe’s and HOME’s casework observations of Bangladeshi migrant workers, wherein $16 to $18 daily basic remains normal. One worker was paid a daily basic rate of $13. For another, his monthly salary was $158, as declared by the employer,” she added.
Earlier, Singapore Democratic Party (SDP) chief Chee Soon Juan also voiced out that people’s lives will be “intolerable” if having low wages but living in a high-cost city.
By making the bus-driver burger comparison, Dr Chee hinted that a Singaporean bus driver can only buy about 300 burgers, which is a huge difference, where even Malaysians who work as bus drivers in Singapore can buy more than 500 burgers in Malaysia.
Migrant workers need GST relief as they suffer “immense” financial pressure
Ms Ong also asserted that migrant workers suffer “immense” financial pressure, which they need relief from, given the upcoming GST hike.
Therefore, she suggested the government to consider distributing GST Vouchers to migrant workers and reviewing social support schemes for the workers.
She said, “Our migrant worker population is one of the most vulnerable in Singapore. They will suffer from the GST hike, but are being offered no relief. It seems counterintuitive to give money to individuals who don’t need the relief while denying those who do. In fact, when we consider migrant workers’ centrality to the building of our nation, it seems almost perverse.”
On top of low wages, Ms Ong highlighted that debt and remittances as well as expenses arising from inadequate legal protection could also exert greater financial pressure on migrant workers.
She explained that the workers need to pay an “extortionate” recruitment debt while remitting at least half of their wages, even up to 80%, to support their families in their home countries.
Of the remaining wages from paying debt and remitting monies home, migrant workers also need to pay for food, phone, and transport bills.
Noting that employers of non-domestic migrant workers are not required to bear the cost of food for their employees, Ms Ong then pointed out that majority of earnings for migrant workers has been spent on their basic necessity – food.
“Our migrant workers have no such help. Given their low wages, high debts and rising expenses, coupled with the high-risk nature of their jobs, they worry every day whether they will be able to provide for themselves and their families,” she said.
She stressed that the financial support is important for migrant workers in coping with the overwhelming financial and mental health challenges during their difficult circumstances – causing them to be vulnerable and deeply stressed on a daily basis – even in the midst of the COVID-19 crisis.
“Surely, before we extend financial assistance to individuals who do not need the relief, we should extend it to those who do in our midst?” she concluded.