Not only that the National Trades Union Congress (NTUC) has failed to set minimum wage levels for workers in Singapore, it even “fights constructive opposition suggestions for this”, said Mr Yeoh Lam Keong on Thursday (22 Oct), as he indicated it as “entirely baffling”.
Mr Yeoh, former GIC Chief Economist, was commenting on the heated argument between NTUC’s Deputy Secretary-General Koh Poh Koon and the Workers’ Party (WP) leader Pritam Singh in Parliament last Thursday (15 Oct).
To recap, Dr Koh had criticised the WP’s proposal of setting up a universal minimum wage of S$1,300 per month, saying that it could result in a worse situation for businesses and workers, and potentially lead to a “political auction”.
He highlighted that the Government’s current Progressive Wage Model (PWM), and Workfare Income Supplement (WIS) scheme, can help to ensure that low-wage workers earn more than S$1,300 without putting their jobs at risk or raising consumer prices significantly.
In response, Mr Singh emphasised that this concern is not with the PWM, but rather on why is the Government taking this long to cover these low-wage workers.
“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. I don’t think it is acceptable that anyone, any Singaporean, is earning below this number. It is simply not acceptable,” he said.
Mr Singh explained that WP’s proposal of a minimum wage does not include foreign labour given that they are governed by other regulations, adding that some sectors might profit off the backs of the PWM.
Dr Koh replied that the tripartite partners had looked into data in their discussions, which showed that the practical considerations of implementing minimum wage may be challenging.
Following that, Mr Yeoh took to his Facebook on Thursday saying that a “constructive collaboration and discussion” would be “more appropriate” for NTUC instead of condemning the WP’s suggestions on the minimum wage issue.
Mr Yeoh cited how major unions and collective bargainings in countries like Austria, Germany and Scandinavia would become “instrumental” in recommending minimum wage levels.
“In some countries this is done so well that such minimum wages stick even without compulsory legislation,” he wrote.
“It’s entirely baffling to me, therefore, why the NTUC, which is perfectly institutionally placed to do so via our well established tripartite process, not only fails to do so comprehensively and quickly but fights constructive opposition suggestions for this incomplete though they may be tooth and nail,” said Mr Yeoh.
He pointed out that the Government should conduct and update studies on the basic needs of the families living in poverty in order to build a “proper income support” for the low-wage workers, particularly those who live in “absolute poverty”.
“There are an estimated 60-80 thousand resident families or around 150 to 200 thousand citizens living in absolute poverty even though one family member is fully employed!” the economist stressed.
Similarly, this was also “resisted equally bafflingly” by the Government, said Mr Yeoh.
“This is because we have had uncontrolled excessive immigration for so long and in such quantity for the 2 decades ending around 2010 that our lowest decile wages are far below the living wage and those of comparable developed economies,” he explained.
Meanwhile, Mr Yeoh suggested increasing WIS cash payouts to ensure that most families’ “basic dignified needs” are met.
For those who are not aware, WIS supplements eligible workers’ income and retirement savings through cash payments and CPF contribution, as stated in the Ministry of Manpower’s website.
“My own back of the envelope calculations suggest an additional $500 -600 per month increase in WIS would be needed for poorest workers. As I have written previously, this is eminently affordable fiscally,” he added.
Mr Yeoh added that the cash supplement can be reduced in gradually as higher work productivity “enables a minimum real wage to reach the properly measured decent living wage longer term”.
“To enable this, sufficiently tight controls on unskilled immigration needs to be maintained, which is arguably not sufficient even after significant improvements in this area after the economic strategies commission in 2010,” he asserted.