Thursday, January 13, 2011

WIS Scheme Does Not Work

After 5 hours of debate, it was proudly reported in the Strait Times papers today that almost all MPs who debated about the minimum wage in parliament yesterday argued that implanting a minimum wage in Singapore would do more harm than good.

Seeing that the Strait Times papers is a government-owned paper, this is not surprising. However if you read between the lines, it also tell you something else. Simply, what Singapore has in place right now does not work!

Instead of a minimum wage, Singapore currently has something called Workfare Income Supplement (WIS) scheme. The WIS is a regular payout given to encourage low-wage workers to stay employed. On paper it sound like a good scheme, but unfortunately the Singapore government shot itself in the foot by putting a large part of the Workfare funds into the worker’s Central Provident Fund (CPF).

Considering that the average worker gets about $80 a month in cash from Workfare, it’s no wonder most people (including it seems some PAP MPs in parliament) feel that Workfare doesn’t help low-income workers. Think of it this way; if the Workfare (as it is) works, why is there a need for a 5 hours debate in parliament?

The Singapore government can argue all it wants about NOT implanting a minimum wage in Singapore, but there’s one thing they can’t get away from. The WIS scheme as it is does not work.

7 comments:

Anonymous said...

Then what makes you think the Minimum Wage will work? Or you have some other schemes?

Ghost said...

Why not try a minimum wage in Singapore? Especially since it's clear that the WIS is not working. Why should Singapore be so fearful about a minimum wage that we coutinue with a scheme that is not working?

Anonymous said...

I agree with 3 things the writer said;
1) Workfare as it is does not work
2) on paper, Workfare is a sound idea
3) the problem is that most of the Workfare is put in the CPF which the low-income worker can’t touch till the day they retire

The solution is simple; If the government get rid of #3 and give all of the Workfare in cash to the low-income worker, problem solved.

Anonymous said...

To 1st post,
What makes our millionaire MPs think WIS work in the first place that they decided to implement it?
I'm sure they must have spend 500hrs to come up with WIS, and in the end, failure.
What is the harm of trying Min Wage then?

Ghost said...

I have thought of the solution of giving all the Workfare in cash to the low-income worker, but the problem with that is that the Singapore government is one that likes to look in the long term. Asking them to give all the Workfare in cash with no CPF is impossible. They will reject it out of principal if nothing else.
That's why I think of the min wage. At least with that, the worker can get CPF.

Anonymous said...

Looking at the long term is important. The low income worker also need money to retire.

Ghost said...

Which is why I suggest the min wage. It they want to look at it in the long-term, then asking the government to put all of Workfare in cash is something that won't work.