Thursday, September 16, 2010

Appeal for Minimum Wage- Tommy Koh & You & I

Letter to Newspaper Forum Editor (published 22.9.2010 here)

15 September, 2010

Dear editor,

I follow with interest the debate in the media about the pros and cons of implementing a minimum wage policy for Singapore’s workers. This is especially so as Professor Tommy Koh, who is revered by citizens from both sides of the political divide, has weighed in in favour of it “as it will improve the lot of Singaporeans in low-paying jobs”

In a media event, Professor Koh alluded to the lowest 20 per cent of our workers, whose median income-a recent study showed, has remained stagnant or even decreased over the last decade, partly due to the influx of cheap foreign labor.

Prof Koh also mentioned that the Gini coefficient ,named after Italian statistician Corrado Gini, and often used as gauge of the income gap as it measures the income distribution across a country, had regressed from 0.436 to 0.478 over the 20 years (0 implying perfect equality and 1 extreme inequality).

In fact, the United Nation Development Program published an unflattering report last year that ranked us second only to Hong Kong in terms of income inequality ( see http://finance.yahoo.com/banking-budgeting/article/107980/countries-with-the-biggest-gaps-between-rich-and-poor) . Now that Hong Kong has jumped onto the minimum wage band-wagon, I dread the day when Singapore would inherit the position as the economy with the most inequitable income distribution.

Many government leaders have mentioned that apart from policies affecting religion and race, there are few sacred cows.

Many feel that the present help-schemes such as the Workfare Income Supplement Scheme (WIS) are not sufficient. For example,the WIS distributes cash : CPF in ratio of 1:2.5 which may not be very useful for workers who are strapped for money.

Hence I hope that our leaders would not be so dogmatic and reject the minimum wage policy in a knee jerk fashion but consider if it is time to relook at this option again. Otherwise, our GDP growth rates would just be meaningless numbers to our urban poor who are beginning to think that the world is passing them by as they start to feel that they have become strangers in their own land.

Dr Huang Shoou Chyuan

4 comments:

Anonymous said...

Govt is not dogmatic. That's the wrong word. Dogmatism plays no role here. No minimum pay law because govt continues to favour exploitation of labour by management. Why do you think, the local unions are rendered TOOTHLESS? Why do you think they have always got a govt minister to boss the NTUC?
Govt wants to maximise employers profit because this in turn translate to high tax collection from companies. Giving more to employees is simply reducing the cake slice of the govt. Govt got a vested interest in keep wage bills low to protect its company tax collection.

nofearSingapore said...

Hi anon:
In a sense the "No minimum wage" no matter what is a dogma ( or some call it a sacred cow) that the PAP does not ( or dare not) change.
Other cows- 1.One party good- multiple parties bad.
2. Million dollar salary for ministers = good govt= no corruption ; normal salary for politicians will allow corruption to creep in.
etc
Whether the reason for not reversing the policy is due to exploitation is anyone's guess. With Temasek-linked companies all over the place- it is of course good for cheap labour whilst those at the top get zillion dollar bonuses.

Anonymous said...

I do not know what is happening in this thread, but it sounds interesting. I just thought it will be good to share. They dont seem to want to speak to other people except their own kind. Why?

http://singaporedaily.net/2010/09/16/daily-sg-16-sep-2010/comment-page-1/#comment-12353

John Peter said...

Thanks for the nice informative post i would forward to my all friends.

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