With all this debate about the Wage Credit Scheme, minimum wage and other labour-related issues, I was curious to find out what the Labour MPs had to say during the budget debate. These are some of the highlights:
1. Zainal Sapari, MP for Pasir Ris-Punggol GRC, on the Wage Credit Scheme:
Zainal wants companies to leverage on WCS to offer higher wage increases or more bonuses to their low wage workers.
He said that Government should lead by example and give higher performance bonus to low wage workers in the civil service. He proposed for low wage workers earning below $1,900 to be given a much higher performance bonus rate than compared to those at the executive levels.
There is the concern that, yes, service providers want to provide better wages to staff… and all service buyers want to offer a better tender amount, but not at the expense of losing business and the competitive edge.
The Progressive Wage Model will help low wage workers obtain salary increases based on a wage ladder concept – meaning they up-skills, improve productivity and get ahead in their jobs – thereby earning better salaries over time.
He proposed that Government make licensing, and the implementation of a Progressive Wage Model in this licensing, a requirement for companies to operate in sectors like cleaning, landscape, and security, where there are many low wage workers.
Our thoughts: It’s true. Why would a company pay more for a cleaning contractor? Let’s be honest, do the companies care about how much you pay your workers? We don’t live in an ideal world. While the WCS may work for some sectors, he was right in pointing out that it’s not a silver bullet to solve the bigger problem at hand. His suggestion to mandate PWM sounds reasonable, especially in sectors where WCS may be even detrimental to the survival of such businesses.
2. Patrick Tay, MP for Nee Soon GRC, on helping PMEs:
Tay was concerned with the high volume of PMEs who are FTs in certain sectors and industries.
He shared about how he met a mature PME in his fifties who was retrenched and replaced by an FT on expat package.
He advocated that Government raise the S-pass minimum salary to $2,200 and making the EP criteria stricter to protect the jobs and livelihood of our junior to mid-level PMEs, which include many middle income households.
He was also glad that Government has taken NTUC’s call for labour market testing as well as having a Foreign PME Dependency Ratio. The Labour Market Test is for companies to prove that they have done all they can to ensure that no Singaporean can be found to fill a particular job vacancy before they are allowed to employ an FT, something already practiced in the UK, Australia, and New Zealand (the foreign PME dependency ratio is for particular sectors and industries with a high number of foreign PMEs).
Tay was pleasantly surprised that the Wage Credit Scheme has been extended to those who earn up to $4,000 per month as he felt it will benefit junior to mid-level PMEs, including PMEs entering the workforce earning between $2,000 and $4,000 per month.
Our thoughts: Tay basically had a field day in Parliament as the policies he had been advocating have taken shape. It is important that Parliament also focuses on PME-specific issues also. People tend to forget that the “sandwiched class” needs an advocate too, so this is great!
3. Heng Chee How, Senior Minister of State for PMO, on assisting mature workers:
Heng said that the employment rate of workers aged 55 to 64 increased from 56.2% in 2007 to 64% in 2012.
He felt this was good as Singapore cannot depend on a free flow of cheaper foreign manpower forever. If that persists, he believed the pay of our low-wage workers would never increase, and our middle-income PMEs will also face unfair competition from FTs.
He asked that tripartite discussions kick off the extension of the re-employment age band from the current (62 to 65) to (62 to 67) to address the needs of the tight labour market.
Heng wants policies that enable workplace healthcare cost-sharing and insurance arrangements to ensure mature workers are more affordable and equitable to both workers and employers.
He felt more can be done to motivate and assist older workers in staying healthy through policy and funding.
Our thoughts: For one, it’s encouraging to see older workers re-joining the workforce and contributing positively to keep the economy afloat. While it may seem that older people just want to live off pensions and enjoy a laidback life in their ‘twilight years’, there are actually many who still want to work to feel useful in society. Obviously, it’s one thing to ask of older workers to keep working, but it takes a collective effort that should be led by the G to ensure that older workers have the means to be in good health in order to be productive workers.