Mr Lee Kuan Yew says that paying Minimum Wage is undesirable because introducing such a legislation will cut employment (watch video below). This, he concludes, will undermine the competitiveness of an economy. Such a view is simplistic and, unfortunately, not more robustly challenged in the public sphere, thanks to the control of the media.
The Minister Mentor says that "market forces" should determine the wage levels of workers in Singapore. Paying workers $3 and ministers $1,000 for an hour's work is not "market forces"—it is exploitation at its ugliest.
Paying indecently low wages in high-cost Singapore not only dehumanises our workers, it also creates insecurity in the workforce which works against productivity. A wage structure that is out of kilter with productivity is inimical to long-term growth.
Legislating minimum wage, the lowest amount of wages an employer may legally pay to an employee, will ensure that workers will not be exploited.
Of course, employers and businesspeople instinctively fear a Minimum Wage policy because such legislation would drive wage costs up, cutting into their profit margins. But such a view neglects to take into account that higher wages increase the spending power of workers in general which stimulates consumption and ultimately benefits business.
Minimum wage also increases the productivity as financially secure workers can focus on their jobs instead of being distracted with having to find supplementary income because of low and inadequate wages.
It also reduces poverty and want which can breed mistrust and resentment towards management thereby lowering quality output of work.
At the state level, Minimum Wage decreases the cost of welfare programs by increasing incomes for the lowest-paid. Such legislation is also relatively easy to enforce because the enforcement agencies only need to act on reported cases of wage violations instead of setting up large bodies to monitor a programme.
Most of all Minimum Wage prevents workers from being exploited and allows prosperity to be shared by all.
Today over 90 percent of countries across the world have Minimum Wage in one form or another. The few countries that have no laws or regulations on Minimum Wage are Bahrain, Qatar, UAE, Tonga, Brunei, Somalia, and, of course, Singapore.
Even Hong Kong is doing something about its income inequality. A minimum wage bill was introduced in the Legislative Council in 2009 and is expected to be passed and enacted in 2010 or 2011. The city even has a Minimum Wage of HK$3,580 (approximately S$650) per month for its foreign domestic workers.
Most economists today agree that the negative effects of such a policy to employers as well as employees are relatively minor.
The Singapore Democrats propose a Minimum Wage of $6.80 per hour. This amount is computed based on a weekly salary of $300 which is necessary for an individual to subsist in Singapore. The amount is divided by the standard of 44 hours of work per week. This amount would be applicable to the lowest of the low-wage income earners.
Given the growing income divide in Singapore and the fact that those on the lower end of the economic ladder continue to face crushing financial burdens, the idea of Minimum Wage is becoming increasingly compelling and urgent.
For a more indepth account of the SDP's alternative proposal on how to narrow the income divide in Singapore, click here.
Tue 04 May 2010 10:31 AM
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whjho - Several provinces and cities raise minimum wages
Just to let readers know that several provinces and cities, including Shanghai, Guangzhou and Suzhou have raise minimum wages.
Despite this, investment are still pouring and GDP up by close to 10%.
Chinese government spend huge monies on driving up domestic demands to compensate for the fall in exports due to crisis and trade imbalance. Some are replacement of home appliances, cars and even relax housing rules (footnote: recent property bubbles after the crisis has caused central to re-introduce measures to raise deposite, interest rates, etc).
However, this is from a 'communist' country which is practising market economy.
Hence, there is a fallacy in such claim that minimum wages drive away investment and reduce competitives.
in this instance, why aren't our almighty 'god' quoting China?
The structure and economy have to be modified. Of course, low pollution and openness is always used as a pretext.
Tue 04 May 2010 11:42 AM
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quantum
Mr Lee is an ultra-rightist and social Darwinist. Such concepts like minimum wage, though proven logical, scientific, enlightened, moral and humane, runs counter to his religion, and implementation will be forbidden by his regime.
Tue 04 May 2010 12:58 PM
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seebeng - LKY has to go
Lee Kuan Yew is yesterday's man. He has no place in today's Singapore to micromanage the lives of Singaporeans.
LKY is for himself, his family, relatives, cronies and yes-men. He makes sure that his coterie is taken good care of at the expense of ordinary Singaporeans who have been pitted to compete with cheap foreign labour that is flooding the country to prop up GDP numbers. These lopsided "economic fundamentals" of the predatory capitalist PAP are used to justify "minimum wage" of at least a couple of million dollars for LKY's "yes ministers" and top civil servants including judges.
Tue 04 May 2010 2:06 PM
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SingaRoars
It is possible that having the no minimum wage policy indirectly supports PAP's country-specific immigration policy.
Outrageously low wages distracts Singaporeans (usually older and weaker ones) from taking up menial jobs thus providing a good excuse for the PAP govt to attact people from the mainland who could (eagerly) do with such wages.
Being perpetually hungry in their own homeland and motivated by a vision of future success makes them eager to do those jobs with or without -- M W P.
Being young and physically strong,(this immi dept will ensure), they can take these 3D job; dirty, dangerous, dreaded jobs avoded by Sgs.
This lends support to the idea that Sgs are not hard driving and proved the minister's views that Sgs are not desperate for jobs.
Thus, thru this almost sado machinistic (SM)political machinations, Sgs are taught thru the hard way the life skills of survival and never say die attitude - an attitude that LKY supposedly taught his son (from Charles Rose recent interview). Thus Sgs are "punished" with "lessons that they will never forget" and the PAP is prepared to start "all over again" with these new immigrants and history will repeat itself.
Sgs will be punished for lacking "spurs in their hide" and for not being "Hard driving".
The millionaire PAP ministers will ensure that these lessons will be learnt well.
And these hard driving "communists" will banter and beat Singaporeans not only in the low end job markets: but elsewhere, in the MOE classrooms, the Universities, in the PMET markets, in the Services Industry, the Resorts and later in government...(?)
Indeed this is a lesson that Sg will never forget.
The Mandarin-friendly and sino-centric atmosphere in Singapore tie in closely with this country specific policy.
So at the end of the day, the shrewd politician in LKY is stating a politically correct view.
That a no-minimum-wage-policy supports a country-specific immi policy which supports sino-majority policy which supports a confuncianst-loyalty-to-master paradigm which translates into the political status quo that the ruling party craves for.
An uncanny politician rising up from the grave indeed!
Exploiting Sgs
Tue 04 May 2010 2:54 PM
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whjho - Typo error
Last statement should read as
The structure and economy have to be modifired. Of course, low POPULATION and openness (as in open economy subjected to the global trends and risk) is alwyas ... pretext.
Tue 04 May 2010 3:52 PM
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nobody
Why waste our precious time in countering this bunch of despicable million-dollar nerds especially, under the de-facto leadership of the dirtiest-oldest-man in this world—the bloody idiotic nerd LKY? As long as they are still in positions of authority and power, nothing will change in their ways of governances!
If he and his cronies were to take up the issue on minimum wages and implement in Singapore then, you will be expecting the sun will rise from the west and set in the east, my dear.
Tue 04 May 2010 4:05 PM
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quantum
See Beng:
You are right. Any truly confident leader sincere in the progress of Singapore should be wise enough to listen to good ideas from all over the country, irregardless of whether they are from civil societies, United Nation, NGOs, international press, opposition, political opponents and dissidents, and use them to build a genuine and complete blue-print for the good of the people, the society and the country?
Wed 05 May 2010 10:08 AM
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SingaRoars
What he meant by jobs for everybody is in order of priorities are his cronies, men in white, mainland fooreigners, other foreigners and lastly Singaporeans. This guy is irrelevant. The only thing that keeps him going is his lickers and suckers.
Wed 05 May 2010 1:10 PM
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vincesdp - Question about minimum wage...
Let's say we have a SGD $1200 minimum wage for everyone in Singapore, including all the non-Singaporeans who live and work here.
- How will the people who hire maids at $200-$300 + per month afford to pay their maids at $1200 per month? Will minimum wage put an end to this form of exploitation in Singapore?
- Do we still need a foreign worker levy? If so, wouldn't that add a few hundred dollars per month to the employer's cost, thus making the hiring of a foreigner more expensive than a Singaporean?
- What structural changes have to be made in Singapore before we can have a sustainable minimum wage system that protects all the workers in Singapore without slowing down economic growth and increasing the cost of living?
I am interested in everyone's ideas on this.
Wed 05 May 2010 10:55 PM
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Robox
First, minimum wage is not for everyone; the most direct benefits are for those who currently work for less than a future intended minimum wage.
Minimum Wage legislation can stipulate exemptions for some sectors, if we remember that such a legislation is intended to provide the worst affected people with an income that will help them to afford basic necessities and some more.
Domestic help, and even foreign workers in certain other industries, have some of their basic living expenses - accomodation, food, etc. - already met by their employers. Thus, we go back to the concept of what is a fair wage in those circumstances. The current system, maybe with minor tweaks though I really don't know, seems to be working fine for workers in those sectors.
The foreign worker levy is revenue collection scam by the PAP government. but you could argue that it is either that or increased taxes somewhere else applied to all.
Finally, as for structural changes, I don't really see the need for any.
But yes, I would like to hear other points of view.
BoredAccountant?
Thu 06 May 2010 9:21 AM
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BryanT - Half the story better than none
I may not agree with some of the things stated in its latest article on Minimum Wages (MW), but SDP should still be commended for trying to:
a) Elucidate on the possible benefits of MW.
b) Give concrete but brief details of its MW proposal.
c) Explain briefly how some concerns could be assuaged and how MW can be implemented.
Among the Opposition parties clamouring to champion MW, SDP is clearly holding leadership position in clarifying its position and providing details of its proposal.
What SDP (and other Opp parties) should consider doing is to also show evident that the party is clear what the possible adverse impact of its proposal is. It did not cover much ground in this aspect in the article.
It should also attempt to explain how the negative aspects could be contained or minimised.
We know that almost all ideas, MW included, are not panaceas to our socio-economic ills.
If it covers both sides of the storyline, Opposition cannot be accused of just painting a “rosy picture” of its proposals. It would serve to increase the credibility of the Opposition parties in the eyes of the electorate and even the government.
The oft-cited excuse that the Opposition does not have the resources to give deeper analysis (eg. to the adverse impact) is not acceptable. Doing so lends itself to accusations of churning out half-baked ideas.
Some Opp parties' proposals comprise just a liner, a paragraph or a few "bullets". In these cases, the word "proposal" would be a misnomer.
In conclusion, well done SDP.... at least for the effort. (at least)
PS. I was half expecting SDP to (yet again) link freedoms and democracy to MW. Fortunately for us, it didn't! (....weird to have to leave politics to fortune, though)
Fri 07 May 2010 12:12 PM
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seebeng - Media holds the key
BryanT,
The major obstacle for the opposition, especially the SDP, is the absence of freedom and democracy. Without freedom and democracy, there is no way for the SDP to take its message, however small it may be, to the people -- the voters.
In an authoritarian system that we have in Singapore, the freedom to reach out to the electorate is freely available to the ruling PAP. The PAP knows that the way to control and keep the masses in ignorance is to take over the running of the media. Hence, a former deputy prime minister as head of the Singapore Press Holdings that controls almost the entire media scene here The role of SPH is to propagate the views, policies and programmes of the PAP to the people and shutdown all other alternative views, especially those of SDP that advocates systemic change to the PAP’s exploitative economic fundamentals.
The PAP, like any other dictatorship, is constantly instilling fear in the minds of the people to reduce them into a state of silence and indifference. Remove the control of the "media" by the PAP, it will crumble like a pack of cards.
The PAP is heavily dependent on the castrated media for its survival.
Sun 09 May 2010 2:57 AM
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Buwakasha - Why we should not have minimum wage law
Jobs that will disappear with minimum wage laws
- Internships
- Volunteer work at old folks home
- Have your parents take care of your child
- Look after your neighbour's dog
- Give your friend a ride to the MRT station
- Teaching Tai Chi at community center
- Helping your neighbour solve their computer problems
and more
Sun 09 May 2010 12:16 PM
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seebeng
It's obvious that someone doesn't know the difference between volunteerism and working for a basic living income otherwise known as minimum wage.
What I would like to see disappear is the multi-million-dollar salaries to PAP ministers who don’t deserve such a huge payout for taking the country into an unprecedented recession leading to a minus 2 percent contraction of the economy last year. These incompetent ministers also have the distinction of making Singapore the first country in this region to be caught in an economic malaise late 2008.
Prime Minister Lee Hsien Loong gets $10,000 a day! Does he deserve such an obscene amount?
Sun 09 May 2010 12:25 PM
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Robox
Actuaslly, someone doesn't have any basic economics on hs side but wants to sound like an authority on it.
Never mind volunteerism, what abouT everything else he raised.
Can anyone in his right mind treat that crap as serious commentary? It's just more of the PAP style mischief making. Nothing more, nothing less.
Sun 09 May 2010 12:35 PM
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Robox
Already at least three individuals from three other parties have stated their support for minimum wage, all in their personal capacity:
1. the PAP's Zagy Mohammed, who is incidentaly also an incurable homophobe;
2. the SPP's Alex Tan; and,
3. the NSP's Goh Meng Seng.
And let's not forget that the RP only took up an official position on MW only late last year, and then again, only when the issue started gaining traction.
Looks like yet another SDP initiative that eventually finds favour with the laggards and from all political backgrounds but only after the issue gets some airing.
MW has been on the SDP's policy books for donkey's years.
Who's been taking the lead from whom?
Mon 10 May 2010 1:28 AM
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Buwakasha
"What I would like to see disappear is the multi-million-dollar salaries to PAP ministers who don’t deserve such a huge payout for taking the country into an unprecedented recession leading to a minus 2 percent contraction of the economy last year."
What has that got to do with a minimum wage law? A minimum wage law is a law that says nobody is allowed to work for a salary lower than X. That means you can throw volunteerism out of the window. And not everything is about volunteerism, some people work for interest, not wages, e.g. teaching. That will also be banned under a minimum wage law.
What I'm saying is you cannot have a minimum wage law. Minimum wage should not be applied to everybody! That's why it cannot be a law.
Mon 10 May 2010 1:36 AM
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Buwakasha
"Actuaslly, someone doesn't have any basic economics on hs side but wants to sound like an authority on it."
You should learn to spell. Are you resorting to name calling now? All I'm saying is that a minimum wage law does not solve any of your problems that you talk about.
What I'm saying is not new, its repeated by countless economist. The most notable economist against the minimum wage law is Milton Friedman. Obviously you don't think the Milton Friedman doesn't know basic economics, do you?
See the youtube video (Search Milton Friedman minimum wage law),
http://www.youtube.com/watch?v=ca8Z__o52sk
Or watch peter schiff's blog about minimum wage
http://www.youtube.com/watch?v=I_IMuxMXd3E
Mon 10 May 2010 1:49 AM
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Buwakasha
"First, minimum wage is not for everyone;"
What? So you agree with me that we should not have a minimum wage law?
"the most direct benefits are for those who currently work for less than a future intended minimum wage."
Right, they will be benefited by unemployment. All the law does is to make it illegal for them to work. Their current employer will have to let them go and find people who are more productive to meet the minimum wage criteria. That's all the law does.
Mon 10 May 2010 1:55 AM
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Buwakasha
"It's obvious that someone doesn't know the difference between volunteerism and working for a basic living income otherwise known as minimum wage."
Its obvious that someone doesn't know the difference between a suggestion and a law. These are 2 different things.
Working for a basic living on an income otherwise known as minimum wage
and
having a minimum wage law
are 2 different things. When you create a law, everyone has to abide by it. Its not the "law" that our PAP subscribes to, but the universal law, that the SDP subscribes to. Everyone is equal under the law. So if you create a minimum wage law, everyone has to abide by it, that means, no volunteerism, no internship, etc.
Mon 10 May 2010 9:42 AM
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vincesdp - continued...
If minimum wage is not implemented equally across the board for every human being in Singapore, then that would cause more problems.
Even in Taiwan, everyone gets a min. of about $800 SGD per month. You do not see a lot of families hiring maids in Taiwan because of that.
The difference between Singapore and Taiwan is their economy has a stronger foundation than ours. They manufacture and export a lot of goods to the world. The government does not dominate the economy and as a result, private enterprises flourish.
They can afford to pay everyone a minimum wage because they are not as dependent on foreign businesses and foreign workers like us.
Mon 10 May 2010 10:14 AM
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Buwakasha
"Even in Taiwan, everyone gets a min. of about $800 SGD per month. You do not see a lot of families hiring maids in Taiwan because of that."
Precisely, such a law just destroy jobs. For example, my mom loves dogs. She's retired now, but she like taking care of dogs, especially if neighbours go on holiday. In return, all she ask for is to have the neighbour cover her food and transport cost. That's definitely below any would-be minimum wage.
With the proposed SDP minimum wage, my mom now cannot work, i.e. ban from working. Yes, she would like it if her neighbours could pay her minimum wage for taking care of their dogs, but if her neighbours were being forced to do so, they would hire a professional rather than my mom. My mom would now be "unemployed" because of such a law.
The same would be for maids. Yes, the law sounds nice, but it does not achieve what its suppose to do.
Thu 13 May 2010 1:20 AM
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Falenier
Like your point on the law but I think there's a difference between a law and a policy. So no worries, you still can take care of someone else's dog without breaking the law.
Mr Lee Kuan Yew says that paying Minimum Wage is undesirable because introducing such a legislation will cut employment (watch video below). This, he concludes, will undermine the competitiveness of an economy. Such a view is simplistic and, unfortunately, not more robustly challenged in the public sphere, thanks to the control of the media.
Support SDP , buy our 30th Anniversary Magazine here
Despite this, investment are still pouring and GDP up by close to 10%.
Chinese government spend huge monies on driving up domestic demands to compensate for the fall in exports due to crisis and trade imbalance. Some are replacement of home appliances, cars and even relax housing rules (footnote: recent property bubbles after the crisis has caused central to re-introduce measures to raise deposite, interest rates, etc).
However, this is from a 'communist' country which is practising market economy.
Hence, there is a fallacy in such claim that minimum wages drive away investment and reduce competitives.
in this instance, why aren't our almighty 'god' quoting China?
The structure and economy have to be modified. Of course, low pollution and openness is always used as a pretext.