52,000 Singaporeans earn less than S$1,300 a month: Zaqy Mohamad to WP's Jamus Lim in discussion on minimum wage

SINGAPORE: Around 52,000 Singaporeans earn less than S$1,300 monthly after "including Workfare supplements and CPF (Central Provident Fund) contributions", said Senior Minister of State for Manpower Zaqy Mohamad in Parliament on Tuesday (Nov 3).

The figure includes 30,000 full-time Singaporean employees working in areas such as food services, cleaning and retail, and 22,000 self-employed workers, said Mr Zaqy in response to opposition Member of Parliament (MP) Jamus Lim, who had asked how many Singaporeans made less than S$1,300 a month. 

Four in five of these Singaporeans have up to post-secondary qualifications and more than a third of them are aged 50 and above, reflecting that low-wage workers tend to be older and have a lower education profile compared to the current generation, said Mr Zaqy.

According to Mr Zaqy, low-wage workers also receive other kinds of support from the Government, including GST vouchers and financial assistance under ComCare. 

He said Singapore follows after the International Labour Organization’s (ILO) definition of earnings, which includes employee contributions to social security and pension schemes.

Therefore, calculations have to consider CPF and Workfare contributions, as these can be used for healthcare and housing needs, he said. 

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Workfare is a scheme introduced in 2007, which provides lower-income Singaporeans with cash payouts and CPF top-ups to encourage them to keep working and saving for retirement.  

“I think it’s worth to note that 75 per cent of our Workfare recipients, lower-income workers, also own their own homes and therefore there’s a direct impact from CPF into your home ownership,” Mr Zaqy said, adding that most minimum wage systems overseas - including in the United States and the United Kingdom - are subject to taxes and social security contributions. 

Dr Lim, who is MP of Sengkang GRC replied, saying: “The ILO has a particular definition but I’m sure that he will also appreciate that for a worker that works full-time in Singapore, they will have a notion of how much their labour effort is worth every month.”

READ: Government launches work group to look into wages, welfare of low-wage workers

In Parliament, Mr Zaqy also pressed Dr Lim to clarify the Workers' Party's position on the minimum wage level as it seemed unclear if it was a gross or nett S$1,300 minimum wage level the party was proposing based on its manifesto and recent parliamentary speeches. 

Dr Lim said his question was not about the minimum wage but about take-home pay, "in part because it is about what it means for survival". 

Despite this, Mr Zaqy asked Dr Lim to spell out WP's minimum wage standards.

"Could I just confirm once again that the Workers' Party's S$1,300 minimum wage benchmark is gross income so that we could settle this and come to an understanding?" he said. 

Dr Lim at first said that was correct and a "fair characterisation", but later said that WP's stand was for the S$1,300 minimum wage to mean take-home pay.

WORKFARE RECIPIENTS 

In response to a separate question by MP Liang Eng Hwa on the number of Workfare recipients, Mr Zaqy said an average of about 400,000 individuals received an average of S$1,560 annually through Workfare in the past three years. The maximum payout was S$3,600. 

Older workers tend to make up the bulk of the programme’s recipients - 49 per cent of them are aged 60 and above and 18 per cent are aged 55 to 59, compared to 21 per cent aged 45 to 54 and 11 per cent aged 35 to 44, he said. 

“The Government will continue to provide holistic support to low-wage workers,” he said. 

“Besides Workfare and the schemes already mentioned, there are also efforts to raise standards of living for low-wage workers in other meaningful ways, such as providing access to quality healthcare, enhanced housing grants and subsidies to help them own their own homes, education for their children and adequate support in their retirement.”

Editor's note:
A previous version of this article said around 52,000 Singaporeans earn less than S$1,300 monthly after deducting CPF contributions. This is incorrect. The calculation includes CPF contributions. We apologise for the error.