The Covid-19 pandemic has dealt a major blow to the global economy. Singapore will also be adversely affected. In dealing with deteriorating economic circumstances, the SDP calls on the government to implement the following five measures immediately:
1. Raise wages. The SDP calls for the wages to be raised for middle- and lower-income earners across professions and industries. This must apply to foreign workers to prevent employers from discriminating against Singaporeans and hiring foreigners solely for lower wages.
Singaporeans' wages have been suppressed for far too long with the PAP resorting to using cheap foreign labour to improve the profit-margins of companies, many of which are GLCs.
It is time that Singaporeans are paid salary levels commensurate with the cost of living in Singapore. Ministers cannot insist that they be paid millions of dollars while making middle- and lower-income Singaporeans compete with foreign workers on wages that our workers cannot survive on.
2. Reduce rental. Raising wages will add a great burden for businesses especially SMEs. To overcome this problem, the SDP calls on the government to reduce rent which it controls through government bodies like HDB, JTC, CapitaLand, Mapletree, and Surbana. The Government is the biggest landlord and high rent is killing businesses especially SMEs.
Some of the savings can then to passed on to raise wages for employees. This will increase Singaporeans' spending power thereby benefiting businesses. It is a win-win situation for employers and employees.
3. Suspend GST until pandemic is over and then cut GST to 5%. Not only must Mr Heng Swee Keat renounce his decision to increase the GST to 9%, the government can and must also, with immediate effect, suspend the GST until such time when the Covid-19 spread is over and the economy has stabilised.
To further assist the economy to recover following the pandemic, the GST must be cut from 7% to 5%. Increasing the GST to 9% (even if it is held off until 2022) is economic suicide. The move will only hurt spending and cause the economy to slump just when recovery needs to take place after the pandemic is over.
4. Return CPF funds. A study found that the major portion of income of retirees come from their children. This is because their CPF funds are insufficient as they are retained by the government. With the anticipated deterioration of the economy, there will be more layoffs and pay cuts. Working couples will find it even more difficult to provide for their elderly parents and at the same time raise their children.
It is for this reason that the government must return retirees their CPF as originally promised. It is not only morally wrong to deprive retirees of their retirement savings – savings which they worked their entire lives to accumulate, it is also economically irresponsible to withhold their funds which will help the stimulate economy in these difficult times.
5. Introduce retrenchment insurance. With anticipated increase in retrenchments, the government must introduce a national retrenchment insurance scheme which pays out 75% of a retrenched worker’s salary for the first 6 months, 50% for the second 6 months and 25% for the final 6 months if those retrenched cannot find re-employment in this 18-month period.
These SDP measures will allow Singaporeans the financial security and confidence to plan ahead and rebuild the economy. Governments across the world are taking bold steps to help their citizens to get over this crisis. We must do the same for our own people.