GE2025: PSP’s Lawrence Pek says PWM is outdated and ‘exclusionary’, defends universal minimum wage proposal (2025)

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SINGAPORE – The time is right for Singapore to legislate a minimum wage for local workers as economic conditions have “changed dramatically” since the Progressive Wage Model (PWM) was introduced in 2012, PSP candidate Lawrence Pek said on April 26.

Mr Pek, a candidate for Chua Chu Kang GRC, also refuted his PAP opponent Jeffrey Siow’s characterisation of a minimum wage as a “political tool”, rather than a practical solution for raising wages at the bottom.

At a walkabout in Teck Whye, Mr Pek said the PWM was implemented at a time when automation and digitalisation were nascent. But today, robotic servers have become common, and companies such as McDonald’s no longer want their staff to take orders.

“We have macroeconomic situations that did not exist 13 years ago when the PWM was envisioned and implemented. It was relevant then, but not now,” said Mr Pek, who was formerly secretary-general of the Singapore Manufacturing Federation (SMF).

The PWM sets wage ladders for certain sectors, such as security, cleaning and landscaping, among others, so that workers can earn more with better skills and higher productivity.

Implementing a minimum wage would give small and medium-sized enterpriseshere a more consistent and reliable workforce, as local workers would then be more willing to stay with their employers, Mr Pek said. Such a policy would also protect workers against rising inflation and the high cost of living through regular adjustments, he added.

Responding to Mr Siow’s point that a minimum wage set above current market wages would lead to additional costs for businesses, Mr Pek said it is “not necessarily true” that prices will rise if minimum wages are introduced.

Mr Pek said the Chinese city of Shenzhen has a universal minimum wage, and is also one of the most cutting-edge cities in the world in technology.

“My remarks are progressive. I know what I’m talking about, not just as the head of the SMF before, but also as a factory owner in Shenzhen, that I actually pay the minimum wage, and my people, my staff, they benefited from it,” he said.

Mr Siow, who was formerly second permanent secretary at the Trade and Industry and Manpower ministries, had on April 25 responded to the PSP’s minimum wage proposal by saying that the Government’s approach, via the PWM, was more targeted than a universal minimum wage system.

He said a minimum wage policy set too low would just be a “political announcement”, and questioned if Mr Pek was proposing a minimum wage similar to China’s, where it is about $300 – or up to 2,690 yuan (S$485), depending on the province.

Mr Pek said he never called for a $300 minimum wage, and the PSP’s proposal was for a $2,250 minimum wage. “He’s putting words in my mouth. That’s a bait, and I’m not going to take the bait.”

Mr Pek said the idea behind the PSP’s proposal is for workers to be protected, regardless of what sectors they are in.

“The whole idea of a universal (minimum wage) is everybody in all sectors. The PWM is exclusionary,” he said.

He added: “I am not calling for the abolishment of the PWM, I’m calling for the feasibility study of a universal minimum wage. That is something that he needs to understand.”

Also at the walkabout were the other PSP candidates for Chua Chu Kang: Ms Wendy Low, Mr S. Nallakaruppan and Mr A’bas Kasmani. PSP chairman Tan Cheng Bock joined them in the late morning to greet residents.

At a media doorstop, Ms Low said paying blue-collar workers slightly higher wages will not add much to overall wage costs for innovation-driven companies which have their headquarters and research laboratories in Singapore.

The tech lawyer said subjecting such companies to a legislated minimum wage would just add to the social good, as they would create high-value jobs while ensuring that their low-income workers earn a living wage.

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