Minimum Wage

Minimum Wage, Whose Idea Was It?

The implementation of a $1400 Local Qualifying Salary (LQS) by the incumbent party came into effect on 1 September 2022. This is a part of the PAP’s efforts to increase the wages of lower-wage workers.

But is the Local Qualifying Salary the same as the Minimum Wage?

The Local Qualifying Salary is supposed to ensure that local workers are meaningfully employed. This is in view of cheaper labor from foreign workers and are only applicable to firms that employ foreign workers.

However, in tandem with the Progressive Wage Model (PWM), both policies basically fulfill the purpose of a ‘minimum wage’.

“I do not think there is going to be a practical difference between what the Government proposes and a universal minimum wage model with exemptions for micro-enterprises, and negotiated job or sector minimum wages.

Dr Theseira

This idea sounds very familiar.

The LQS was implemented almost a year after PAP shut down Jamus Lim’s call for a universal minimum wage. At that time, Lim explained that the PWM was not sufficient, and had backed Pritam Singh’s $1300 minimum wage proposal. However the incumbent party argued that this will risk generating a ‘political auction’, and that it is not feasible.

If the implementation of the LQS essentially has the same effects as the so-called, ‘minimum wage’, it does seem strange for the incumbent party to implement it themselves only after shutting down the proposal from the opposition party.

This is especially so with the ‘$100’ increase after the proposition was shut down for its risk of generating a ‘political auction’.

Certainly food for thought.