S’pore workers can afford more

Dear Madam Halimah,

I refer to your comments in parliament as reported by Straits Times on 4 Mar 2010.

Despite the ‘puzzling’ decrease in Singapore’s gross wages from 2006 to 2009 as you have pointed out, the ball part figure is largely correct so the picture of relative income vis-a-vis other countries is still valid. Adopting the government’s hourly wage estimate of $14 an hour instead of $10.85 an hour would merely boost Singapore’s gross hourly wage from 32.7% that of New York’s to 42.2% that of New York’s. Are we that much more proud that our gross hourly wage is 42.2% that of New York’s instead of 32.7%? Or should we be asking ourselves why our gross hourly wage is not even half that of New York’s?

You said professionals, managers and executives accounted for only 9% of the workforce in the UBS figures whereas they actually make up 52% of Singapore’s workforce. But most of the first world cities ahead of us in the list also have large percentages of professionals, managers and executives in their workforces so any disadvantage that we suffer due to percentage discrepancies would likely be suffered by them as well. So this does not explain why our gross hourly wage is not even half that of New York’s. Hence, your assertion of significant underestimation due to flawed assumptions does not hold water.

You said the UBS comparisons omitted CPF payments which can amount to 20% of our income and can be used to pay for our homes. But Singaporeans have no social security to depend on and must pay for our medical and retirement needs out of our own pockets. It’s the same whether we use 20% of our income to pay for homes and use the rest of our disposable income to pay for medical and retirement needs or in the case of the Western nations, use 20% of their income to pay for medical and retirement needs and use the rest of their disposable income to pay for homes. There is no difference, so again, this is a non-issue.

Finally, you argue that expensive Western goods like steak and frozen pizza are not part of the average Singaporean’s expenditure and so should not count towards the calculation of price levels. Going by your logic, it would be all the more better if Singaporeans can afford to buy only the cheapest of goods. If we can’t even afford the same quality goods that people in Western nations enjoy, how can we profess to have achieved the same standard of living as they have? So it makes sense comparing ourselves against the Western nations on how well we can afford the same basket of goods.

Hence, despite the issues you have brought up, the study’s conclusion is fundamentally sound and that the UBS figures do reflect the actual situation to a high degree.

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