The PAP is
using $1000 to showcase the targeted democratic socialism announced last year.
Cleaners and guards will have a guided basic wage of $1000 per month. And the PAP claims that this is not minimum wage.
Only affected companies need to comply if they want to renew their licenses and
stay in business.
What is the
difference between a targeted wage and a minimum wage? We don’t know as we have
to watch the development whether all Singapore workers will demand for $1000
per month when applying for a job. Now,
there is a targeted wage rate, will other industries follow or not?
More
importantly, will this close the gap between the rich and the poor? Most likely
not, from $800 to $1000 looks like a big increase of 20%, but what is $200 per
month to a high income earner? So, this
is a targeted approach, just like a 5-year plan, how often will it adjust?
Or, the target is set intentionally low - an outdated calculation just to
showcase the so-called democratic socialism. Because there is a popular demand
and because the fact shows no wage increase in the past 10 years, the PAP is
forced to come out with a lower than expected targeted wage guideline?
So, when we
talk about Swiss standard of living, it is a target, and not the minimum. Now,
you know why only few have achieved the Swiss standard of income (may be living
too), but majority of us are still looking at the target, laughing at the
target.
Hence, when announcing this new strategy, DPM Tharman Shanmugaratnam said, “Our approach is different. We want to raise incomes while helping everyone, including those with less skills, to stay on the job ladder.” (Today, 9 Jan 2014).
Direct or Indirect Way
By using a
targeted approach, the PAP is using an indirect approach in helping lower
income workers. In fact, in the past 50 years, we have witnessed the change of
approach from direct to indirect. From direct taxes to indirect taxes, from no
COE, ERP to their implementations, even the public transport companies, there
is a targeted rate of return.
The
advantage of this indirect approach is that it is very easy to implement. The government
just uses administration measures to set the target, a moving and adjustable
one, not a promised minimum one.
It means there
is no human contact and no real feeling, only through two parties – between employers
and employees and the government is an indirect third party.
This is the
greatest disadvantage of an indirect targeted approach. When prices (COE, ERP,
transport fees, taxi fares, school fees, HDB flat price and cost of living) increase,
the government does not have a direct feeling. They just adjust the regulations
and set a target.
An indirect
targeted approach can become very passive in thinking, in running the country and
in solving the real needs of lower income workers. Otherwise, the pro-claimed
most efficient government in the world will not wait for more than 10 years or
15 years to look at the problems and try to solve it now (really?).
DPM Tharman admitted that “Cheap-sourcing practices discourage wages, skills, and quality from moving up in the way they do in most other industries.’ (Today, 9 Jan 2014).
Why does the
government allow ‘cheap-sourcing practices’ for so long? It is because it is an easy way out and indirectly,
the government can have extra revenues from work permits, levies etc.
This
indirect thinking and approach is now deeply planted in the government administration.
So much so that even Temasek also claims that they do not manage CPF monies.
True or False? (Today, 8 Jan 2014)
|
We all know
that CPF monies go to the government through the issuance of government bonds.
The government then provides monies to Temasek for investments inside and outside
Singapore. Yes, in paper, Temasek does not manage CPF monies directly. However,
indirectly Temasek gets the funding from the government. So, who are the main
contributors of the sovereign funds to Temasek? The people of Singapore,
including CPF members, through the government, give the monies to Temasek for management
and investment.
The theory
of ‘Temasek does not manage CPF monies’ is an indirect thinking. Unless, Temasek gets her monies from a
foreign source, it then can claim that it is not managing the monies of Singapore.
With this indirect approach and
thinking, one wonders whether Temasek’s investment approach is for Singapore or
for her own management.
No wonder up
to now, there is still no government issued bonds to fight inflation in Singapore.
Under the indirect target approach, can we expect a similar inflation-indexed ibond#1
on offer in Singapore?
#1
How come when it came to increasing their own Minister salaries, they have instead taken a DIRECT approach to comparing with the 8 highest income earning professions straightaway ?
ReplyDeleteAre they telling us straight from their horses mouths that they REALLY are hypocrites to begin with ?