Low-income workers have seen 'significant' pay rises
By Fiona Chan
WAGES in Singapore have not stagnated over the last 10 years, contrary to what some opposition politicians have been saying, Finance Minister Tharman Shanmugaratnam said yesterday.
He revealed that low-income workers have enjoyed a significant boost in their pay over the last five years, while the typical worker in Singapore has seen a bigger jump in salary than those in developed countries.
Opposition parties, including the Workers' Party, Singapore Democratic Party and Reform Party, have accused the Government of not doing enough to help those on the bottom rungs of the economic ladder, saying the wages of the lowest-income households have remained stagnant in recent years.
But that is not so, Mr Tharman said, giving figures to refute their statements.
He disclosed that the average income of a family in a three-room HDB flat rose 28 per cent between 2005 and last year.
Even after adjusting for inflation, real wages would have jumped 14 per cent, he said at the People's Action Party's (PAP) lunchtime rally. This is before taking into account Workfare top-ups or any special transfers by the Government.
For other Singaporeans, the median income grew 25 per cent over the last five years, or 10 per cent after inflation.
This was better than in Hong Kong, where real wages rose 4 per cent in the same period; South Korea, which had a 2 per cent increase; or Taiwan, where real incomes fell 3 per cent.
Still, the 10 per cent rise in Singapore 'is not good enough, and in the next 10 years, we want 10 per cent to become 30 per cent', Mr Tharman said.
He attributed the increase in salaries to two factors: more jobs being created and wages as a whole moving up.
But he also acknowledged that 'there are those who have not seen a wage increase' and others whose wages have fallen, and that the Government must find the best way to help people 'for whom day-to-day living is a real challenge'.
This can be achieved through 'strategies that really grow our economy and keep it diversified', said Mr Tharman.
The Government will help workers attain a 'massive upgrade in skills in the next 10 years', as well as keep redistributing resources to help the poor and middle-income groups more, he added.
'We've got a sound revenue base, we've avoided debts and we've kept our reserves growing for the long term... That is how we must continue to run our economy and our policies for the next 10 years,' Mr Tharman said.
'Nothing is cast in stone, nothing perfect, but let's keep centring our policies on raising living standards for all. And whatever we do, let's avoid spending without the resources to sustain it, avoid spending that will lead to higher taxes.'
At yesterday's rally in UOB Plaza, Mr Tharman also warned of the 'very real risk of a setback in the global economy'.
'Basically, the problems that led to the crisis are not over,' he said.
'The problems of excessive household debt, the problems of governments that have over-borrowed and the problems of banks that are themselves in a very fragile state are not over, and these problems will be with us for several years to come.'
New challenges - mainly of inflation and rising oil and commodity prices - have also emerged after the financial crisis, noted Mr Tharman.
'No one can rule out a significant increase in oil and other commodity prices in the next year or two,' he said.
'And when you add that new risk to the old risks that are still with us, you have a world economy that is, as (World Bank president) Robert Zoellick said, one shock away from another major crisis.'
To top it all off, a new 'fundamental challenge' is emerging as China muscles its way into middle- and higher-value activities in manufacturing and services.
This means that it is not just the blue-collar manufacturing worker who is at risk, but also workers in white-collar jobs, Mr Tharman said.
'China is progressing and behind China, you've got India, Brazil, some of the Eastern European economies are also catching up.
'We can't change that reality. We have to cope with it, adjust to it and find a way to thrive and prosper even with this challenge,' he added.
By Fiona Chan
WAGES in Singapore have not stagnated over the last 10 years, contrary to what some opposition politicians have been saying, Finance Minister Tharman Shanmugaratnam said yesterday.
He revealed that low-income workers have enjoyed a significant boost in their pay over the last five years, while the typical worker in Singapore has seen a bigger jump in salary than those in developed countries.
Opposition parties, including the Workers' Party, Singapore Democratic Party and Reform Party, have accused the Government of not doing enough to help those on the bottom rungs of the economic ladder, saying the wages of the lowest-income households have remained stagnant in recent years.
But that is not so, Mr Tharman said, giving figures to refute their statements.
He disclosed that the average income of a family in a three-room HDB flat rose 28 per cent between 2005 and last year.
Even after adjusting for inflation, real wages would have jumped 14 per cent, he said at the People's Action Party's (PAP) lunchtime rally. This is before taking into account Workfare top-ups or any special transfers by the Government.
For other Singaporeans, the median income grew 25 per cent over the last five years, or 10 per cent after inflation.
This was better than in Hong Kong, where real wages rose 4 per cent in the same period; South Korea, which had a 2 per cent increase; or Taiwan, where real incomes fell 3 per cent.
Still, the 10 per cent rise in Singapore 'is not good enough, and in the next 10 years, we want 10 per cent to become 30 per cent', Mr Tharman said.
He attributed the increase in salaries to two factors: more jobs being created and wages as a whole moving up.
But he also acknowledged that 'there are those who have not seen a wage increase' and others whose wages have fallen, and that the Government must find the best way to help people 'for whom day-to-day living is a real challenge'.
This can be achieved through 'strategies that really grow our economy and keep it diversified', said Mr Tharman.
The Government will help workers attain a 'massive upgrade in skills in the next 10 years', as well as keep redistributing resources to help the poor and middle-income groups more, he added.
'We've got a sound revenue base, we've avoided debts and we've kept our reserves growing for the long term... That is how we must continue to run our economy and our policies for the next 10 years,' Mr Tharman said.
'Nothing is cast in stone, nothing perfect, but let's keep centring our policies on raising living standards for all. And whatever we do, let's avoid spending without the resources to sustain it, avoid spending that will lead to higher taxes.'
At yesterday's rally in UOB Plaza, Mr Tharman also warned of the 'very real risk of a setback in the global economy'.
'Basically, the problems that led to the crisis are not over,' he said.
'The problems of excessive household debt, the problems of governments that have over-borrowed and the problems of banks that are themselves in a very fragile state are not over, and these problems will be with us for several years to come.'
New challenges - mainly of inflation and rising oil and commodity prices - have also emerged after the financial crisis, noted Mr Tharman.
'No one can rule out a significant increase in oil and other commodity prices in the next year or two,' he said.
'And when you add that new risk to the old risks that are still with us, you have a world economy that is, as (World Bank president) Robert Zoellick said, one shock away from another major crisis.'
To top it all off, a new 'fundamental challenge' is emerging as China muscles its way into middle- and higher-value activities in manufacturing and services.
This means that it is not just the blue-collar manufacturing worker who is at risk, but also workers in white-collar jobs, Mr Tharman said.
'China is progressing and behind China, you've got India, Brazil, some of the Eastern European economies are also catching up.
'We can't change that reality. We have to cope with it, adjust to it and find a way to thrive and prosper even with this challenge,' he added.
