Singapore’s approach to uplifting the lower-wage workers is more complex than you think

TL;DR – There’s a bigger picture you can’t see and it is not as straightforward as you think.

It’s the time of the year again, where Prime Minister Lee Hsien Loong delivers his National Day Rally speech to the entire nation. Like many other Singaporeans, I kept my eyes peeled and ears open as PM Lee addresses issues Singapore is facing currently.

Out of all the issues, I was particularly interested in the range of support measures the Government will be adopting to uplift the lower-wage workers as this group of workers has been hit particularly hard by the fallout of the Covid-19 pandemic.

Lower-wage workers have felt the impact of Covid-19 most acutely.

In case you missed the entire 75 minutes speech, here’s a quick summary of the three recommendations put up by the Tripartite Workgroup to better support the lower-wage workers:

  1. The Progressive Wage Model (PWM) will be extended to more sectors, starting with retail and food services and waste management sectors in 2022.
  2. Companies that are hiring foreign workers must pay all of their local workers a lowest qualifying salary (LQS), instead of only some – which is the current practice.
  3. Companies that are paying their workers Progressive Wages (PW) will be accredited with a PW Mark. This will help consumers identify companies as responsible employers who are paying all their workers decent wages. For a start, the public sector will take lead and purchase only from such businesses.

A holistic approach

Before we jump the gun to start the whole Minimum wage vs Progressive Wage Model argument and how the Minimum wage is a more superior scheme to the Progressive Wage Model, here’s a reminder to everyone that the Minimum wage is only the first rung whilst the PWM is a ladder of skills and wages that help our lowest-income workers move up.

First mooted by NTUC in 2012, the PWM sets out the skills workers must attain in order to qualify for higher wages in certain low-paying sectors. These include the cleaning, security, landscape, and more recently, the lift and escalator industry.

And what many Singaporeans failed to see is that the PWM is only one piece of the puzzle when it comes to uplifting the lower-wage workers.

We ought to also take into account other support schemes for the lower-wage workers, such as the Workfare Income Supplement (WIS) and also the other forms of help via the Social Transfers.

The WIS tops up the salaries of the lower-wage workers and helps them save for retirement, while the Social Transfers (which include schemes such as the permanent GST Voucher scheme, U-Save Rebate, the Service and Conservancy Charges (S&CC) Rebate, the MediSave top-ups and the list goes on…) help to offset the taxes these lower-wage workers pay.

Not sure about you, but I can see that the Singapore Government is trying to support and uplift the lower-wage workers in a more holistic way while looking at the issue from various perspectives.

While we can all agree that this group of lower-wage workers need to be paid more, especially they are the ones likely to have no emergency savings and without a strong social safety net, however, on the other hand, as part of a democratic society, I’m sure we also do not want individuals to forget about having the right work attitude – which is something the minimum wage removes, amirite?

The last thing we want is to see is for this group of vulnerable workers to continue to be stuck in the vicious cycle of the poor remaining poor just because they know that the Government of the day will continue to take care of them, and there will be legislation to increase the said minimum wage anyway.

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Gabrielle Teo

Author Gabrielle Teo

I read lots, and I also spend an indecent amount of time trying to get my mostly unpopular opinions published. Oh, I argue a lot with fellow Singaporeans who complain incessantly about Singapore too.

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