Democrats rebut PAP minimum wage groupthink

January 18, 2011
Singapore Democrats

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Singapore Democrats

Last week in Parliament several PAP MPs demonstrated their awesome ability to engage in groupthink. They stepped up one by one to say how Minimum Wage will not work while blithely ignoring the fact that the policy is a key feature in developed economies all around the world.

Instead they promoted their party’s Workfare Income Supplement (WIS) Scheme which is effectively a programme to get older workers to continue working but for less pay. The Singapore Democrats pointed out how ineffective WIS was here.

We take this opprtunity to rebut some of the points that the MPs made about Minimum Wage and in the process continue to make our case for its introduction in Singapore.

Ms Josephine Teo: “From the perspective of the labour movement, growth in the last few years has been inclusive. Our tripartite approach works…As the economy grows, now is the best time to catch the wind and help low-wage Singaporeans do better and for Singapore to become even more inclusive.”

It is patently untrue to say that Singapore’s economy is inclusive. For much of the last decade when the economy was booming, the income disparity increased every single year. (See figure on right) Even as the rich made their millions, the working poor saw themselves getting more and more impoverished.

The PAP lifted not a finger to help these low-wage workers then. Now it expects us to believe that it is serious about helping them? Does the fact that the elections are around the corner have anything to do with this sudden demonstration of compassion?

Ms Denise Phua : “A minimum wage will become an additional cost of business paid by employers who in turn will either pass on the cost of business to their customers, causing further increase in the cost of living, or become more cautious especially in hiring those who are less skilled or able.”

Increase in the cost of living is caused by the myriad of fees and fares that the PAP imposes on the people. It is also caused by the high rentals that businesses have to pay to an oligopoly. Office and business rentals are determined largely by the control of land and its sales which the PAP Government controls.

If Ms Phua is genuinely concerned about not increaing the cost of living in Singapore, she would propose that her party stops jacking up land cost. She would also advocate that the GST be reduced and abolished for essential items, and that fees like public utility rates be decreased.

Instead she is using the passing-the-cost-on-to-consumers bogey to deny low-income workers a decent, lving wage. Minimum wage will put more money into the pockets of workers which will mean greater spending power for the people and the increased consumption will benefit businesses and, hence, the general economy.

Mr Heng Chee How: “You do that [introduce minimum wage], and if the workers become unemployed, you have just converted them from low-wage workers to no-wage workers. Who is (then) going to be responsible for these no-wage workers and their families? I don’t recommend minimum wage but best wage.”

Mr Heng treads on dangerous ground when he talks about Singaporeans becoming unemployed. In the first place it is the PAP’s policy of bringing in cheap foreign labour enmasse that has led to countless Singaporeans being displaced from their jobs.

Those who manage to find work have to compete with foreign workers who are willing to accept lower wages because they are transient workers with their families back in their home countries. Singaporeans, with their roots here, cannot survive on these wages.

This problem can be attenuated by the SDP’s proposal of a Singaporeans First Policy where businesses are required to demonstrate that the skills that they want to hire cannot be found among the locals before they are allowed to employ foreigners. This will stop our over-reliance on foreign workers and help Singaporeans secure proper paying jobs.  

Mr Gan Kim Yong: “The impact will be worse during a recession because employers are more likely to retrench low-wage workers who are drawing the minimum wage as they cannot adjust their wages.”

Our low-income workers are already not able to make ends meet with their measly wages. Their lives are a living hell with many being evicted from heir flats making them homeless. Many see no way out and end their misery by committing suicide. Singapore sees an average of more than one person committing suicide every single day.

Others turn to seeking free food at temples or grabbing unfinished meals left behind by patrons at hawker centres. Social services see many families unable to cope with low wages in an expensive economy. And how many out of desperation turn to loan sharks or a life of crime?

Retrenched? They’d be happy if they survived while employed.

Mr Lim Swee Say: “While we allow a lot of foreign workers to enter Singapore, we’ve never done so at the expense of high unemployment in Singapore…”

How does one rebut propaganda like this?