1 Madam, many Members have shared their views regarding how this can be achieved. Several Members touched on the issue of minimum wage. I noticed that not many Members here stood up to support strongly minimum wage and, yet, at the same time, not many Members are prepared to rule out the possibility of introducing minimum wage in Singapore. I thought it will be useful for me to speak from the standpoint of the Labour Movement why the NTUC has no intention of adopting minimum wage as part of the solution, as suggested by Member Viswa Sadasivan. We have no intention to pursue minimum wage at the sectoral level as suggested by Member Low Thia Khiang. And we do not intend to wait for all our tools to fail and to go back to minimum wage, as suggested by Member Irene Ng.
2 Madam, what is minimum wage? Imagine: a worker, an employer and the Government – three parties – come together. The worker says, "cost of living is too high; I need $1,400 of salary every month to survive". The management says, "competition is too strong; cost of business is too high; I can only afford to pay this worker $1,000 per month in order for the business to survive". The Government looks at the worker and says, "yes, I hear you; $1,000 is too low, but I also hear the employers – $1,400 is too high". So what does Government do? It says since $1,000 is too low, $1,400 is too high, why not with some negotiation let us settle for $1,200. When we settle on $1,200, frankly speaking, nobody is happy. To the worker, $1,200 is too low. To the employer, $1,200 is too high. So, both sides are unhappy.
3 上有政策，下有对策. When the Government, notwithstanding the unhappiness on both parties, decides to implement the minimum wage, what are the problems? The first problem is the rise of the no-wage workers. A few of my fellow labour MPs have touched on this. When we impose minimum wage and to think that no employer would retrench their workers and just accept the minimum wage, is not realistic. As Member Josephine Teo pointed out – and I think it is a very important point – just imagine if the Government imposes a minimum wage of $1,200, who are the workers who are most at risk of losing their jobs? Take two workers: one is earning $1,100 today – just $100 below the minimum wage, one is earning $800 – $400 below minimum wage. If the Government were to impose $1,200, between these two workers: $1,100 versus $800, who do you think is at greater risk of losing his job? To me, the answer is very obvious. The one who is earning $800, the lowest-skilled workers, the lowest-wage workers, are the ones who are most likely to lose their jobs and they are the ones, in fact, who need their wages – even though it is $800, even though it is $1,100 – more than anybody else. I do not think we, as a labour movement, want to see them ending up as no-wage workers.
4 Secondly, some of my colleagues have also mentioned, again, and I think it is important to repeat. Minimum wage in practice would turn into maximum wage for the low-wage workers. Once the minimum wage is imposed, these low-wage workers that are paid the minimum wage, they do not have any increment. Why? The employers will adopt the position: actually you are worth only $1,000 but under the law, I am forced to pay you $1,200. Since I have already met the requirement of the law, there is no way I am going to give any increment. So, minimum wage would always end up being a maximum wage for the low-wage workers. But, most of all, minimum wage will end up to be sticky wage for the low-wage workers. Just study the countries that have implemented minimum wage and I think it is easy to see. The workers there are not happy because the minimum wage has turned into maximum wage and that maximum wage can only go up when the governments having consulted the employers, the workers, come to a decision to revise the minimum wage. As Member Halimah Yacob mentioned, in many countries it took them two years, three years, many years to agree on the increase. By that time they had agreed on the increase, the cost of living has already gone past them. So, minimum wage will impose these three potential problems: no wage, maximum wage and sticky wage. That is the reason why, the Labour Movement of Singapore, we are against this idea of minimum wage. It is a solution that looks easy, a stroke of the pen, but actually we do not believe it will serve the interest of the low-wage workers of Singapore.
5 Since Singapore has adopted a different approach, and Members have described it using different terms. I heard member Heng Chee How using the term "best wage". Basically, this Singapore approach is different in that the three parties come together: the workers, the employers and the Government. The Government basically said, "yes, I hear the workers facing this problem of 'money no enough'. At the same time, we hear the employers that global competition is very keen". So, what do we do as a Government? What do we do as tripartite partners? We introduced Workfare Income Supplement. As the Prime Minister mentioned at our PAP Party Convention, Workfare Income Supplement is our version of minimum wage. A worker who is earning $1,000 per month can receive as much as $2,800 per year which is equal to 2.8 months' of his salary. It is not a small sum. $400 million for the low wage workers in the workforce. Workfare Income Supplement is our version of minimum wage but the beauty is this: this money does not come from the employer. It is not a burden imposed on the employers, it is a funding directly from the Government. We also recognise that the main purpose of the Workfare Income Supplement is to buy time so that workers who may need some time to move upward – from lower wage to higher wage – can receive the kind of financial support in the mean time. But as Member Calvin Cheng mentioned, upward mobility is important, and I fully agree with that. So, in our situation, in helping low-wage workers, besides providing Workfare Income Supplement, we spend a lot of time, a lot of energy on other programmes to help to enhance the jobs of the low-wage workers, the skills of the low-wage workers. Again, many labour MPs, in their speeches, have shared with this House the kind of programmes, the kind of efforts being put in by the tripartite partners to help the back-to-work women, the low-wage workers, the casual contract workers, the older workers. And the list goes on and on.
6 In the process of doing so – of course, there are some concerns. Member Assoc. Prof. Paulin Straughan's concern is that the employers may take advantage of Workfare Income Supplement from the Government by exploiting the workers, by hiring more foreign workers who are cheaper and so on. Madam, the truth of the matter is that the Labour Movement and the tripartite partners all subscribe to what the former Secretary-General of the NTUC, Minister Lim Boon Heng, reminded us year after year that a job is the best welfare for the workers. In fact, the Labour Movement has always believed that a job is the best welfare and full employment is the best protection for the workers of Singapore. And that is the reason why while the tripartite partners do allow foreign workers, foreign manpower to come to Singapore but we have never done so at the expense of having high unemployment in Singapore. Why? Because the inflow of foreign manpower, foreign workers, is to help us sustaining economic growth. They are not here to raise our unemployment rate.
7 In fact, if you look at today's situation, the economy is growing strongly, the labour market is tight. And when the labour market is tight, as we support our low-wage workers with Workfare Income Supplement, and yet at the same time, employers would have no choice but to re-design the job, to enhance productivity so that they can produce more with the same number of workers. At the same time, we put in place a programme to help the workers to upgrade their skills. In this way we upgrade the skills, upgrade the productivity, re-design the job and, as a result, we avoided the three problems.
8 We avoided the first problem of no wage because the minimum wage in Singapore in the form of Workfare Income Supplement comes from the Government, not from the employer. As a result, we do not have a no-wage problem. Secondly, we do not have maximum-wage problem. A worker who is on Workfare Income Supplement, as far as his employer is concerned, he is still receiving his market salary. At the end of the year, he still gets his annual increment. So the workers on Workfare Income Supplement still have their wages continue to go up year by year. They do not end up being stuck to the minimum wage as the maximum wage. And, thirdly, the low wage in Singapore is not necessarily sticky for those who are able to upgrade their skill and enhance their productivity.
9 Some Members may wonder while this sounds very good in theory, does it really work? Has it worked on the ground? Madam, Member Denise Phua pointed out that so far the security sector is most visible in the progress of re-creating the job. As a result, security officers five years ago were within the bottom 10 percentile of our workforce, earning about $850 per month when our 10 percentile income was about $1,000 or so. Today, those in the security sector, on the whole, have now reached 20 percentile. In fact, some of them have already exceeded the 20 percentile towards the 30 percentile. The security sector is a clear illustration of how we helped the security officers through Workfare Income Supplement and, yet, at the same time, re-created the job and redeveloped the skills of the workers.
10 I am happy to share with Member Denise Phua that the security sector is not the only one. In fact, the landscaping sector under the leadership of NParks has also made tremendous progress under their Best-Sourcing Initiatives. Conservancy cleaning too. All PAP Town Councils practise best-sourcing. The average starting pay has now exceeded $1,000 and those who are more skilful, those who operate more productive equipment are able to earn more.
11 Obviously, we would like to do more. Member Josephine Teo shared with Members that under the Inclusive Growth Programme (IGP) we are now extending our reach to more and more sectors. Madam, some Members may wonder if the Singapore approach does so well – better than the minimum wage solution – then why is it that 90% of the countries in this world have decided to adopt minimum wage? Why is it that Singapore think that we can have this same-same but different solution? Same-same problem with low-wage workers but different solution in not adopting minimum wage? Madam, recently a new ambassador to Singapore made a call on me and asked me about this issue of low-wage workers. I explained to him how the Workfare Income Supplement scheme work in Singapore. And his immediate reaction was, "Only you can do it because in many countries, governments are running budget deficits, there is no way they can find the money to fund such a programme." So he said, "Yes, this is the strength of Singapore." But I told him, "yes, Workfare Income Supplement is capitalising on our financial strength because the Government, as a country, has the financial resources to support the low-wage workers".
12 But, more importantly, over the years, we have put in place a CET system – Continuing Education and Training system – to enable the widespread upgrading of low-wage workers in Singapore. Over the years, starting with Skills Redevelopment Programme (SRP) to pursue skills certification, we went into NSRS, ESS and WSQ, and so on. Today the CET system in Singapore is one of the most comprehensive in the world and we have very strong support programmes targeted at the low-wage workers, like for example, the Workfare Training Scheme (WTS). So in other words, we are able to do what other countries are not able to do because we have been working on this for many years. We have been building up our financial capital, we have also been strengthening our knowledge infrastructure and, as a result, we are able to pursue WIS, we are able to pursue WTS which other countries are not able to do. And on top of that, we have something that many countries do not have and this is the constructive tripartite partnership. Because in other countries the labour movement, the government, the employer are not able to sit down together to find a solution that will work for all three parties. But in Singapore with tripartism we are able to do so.
13 Madam, in conclusion, I want to emphasise again. Even though 90% of the countries in this world have decided to pursue minimum wage as a solution towards helping the low-wage workers, we in Singapore, the Labour Movement included, we are determined not to take that path because that is not a better path. Our approach is different from the rest of the world but being different does not mean we are wrong. In fact, being different means we are better, we have a better solution. So other countries play to their weakness, we should capitalise on our strength.
14 On that note, Madam, I urge this House to support this motion moved by Member Josephine Teo. Let us work together. Commit ourselves to inclusive economic growth and, more importantly, commit ourselves to continue to do more, do together, to enable more Singaporeans to have better jobs, better pay and live a better life.
