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Pritam Singh: companies profiting off the backs of PWM for lift sector with increased price bids

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Yesterday during the debate on the minimum wage and progressive wage model, WP Pritam Singh said he was worried that some sectors would profit off the backs of the PWM (Progressive Wage Model) by pricing in the wage increases even before it has been implemented.

He gave the example of lift contracts in his constituency where some companies have increased their bid cost by between 5 and 47 percent.

Mr Singh said, “If all this increase is going to the Singaporean worker, then I’m prepared to take on that burden to persuade our town council residents that we need to raise S&CC. But my question is, is that a realistic hike in costs?”

I don’t know whether to be amused by his question.

Does Mr Singh not know that wage increase comes at a cost and someone has to pay for the increase?

Would not a minimum wage proposed by WP also lead to an increase in cost for which someone also has to pay?

Did his own MP Jamus Lim not say that 75% of increase in a minimum wage will be borne by consumers?

In the case of the Lift and Escalator sector, the Progressive Wage Model will be progressively phased in in the next 3 years. It makes sense that contractors renewing their contract would factor in this increase when they put in their new bids today. A contractor may factor in a smaller increase if the contract is renewed for 1 year. If it is renewed for 2 years, then the contractor may factor in a larger increase.

If Mr Singh thinks a particular contractor is putting in an unreasonably high bid, he can reject that bid for a lower bid.

The Workers’ Party should not take the populist approach of being seen as fighting for the workers with a minimum wage proposal and then expressing unhappiness over the consequential higher cost for residents (who happen also to be workers).

Someone has to pay for the wage increase and Workers’ Party should be honest and upfront about this.

– Submitted by Koh Hui Ting

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