Current Affairs
Minimum Wage Only Beneficial in Long Term
By Gordon Lee
Much has been said of the minimum wage of late, and I would like to give my opinion and proposal on it.
The Case for a Minimum Wage
There is a strong case for minimum wage recognised by its successful implementation the world over, including, more recently, Hong Kong (which is probably the most similar country to Singapore). Singapore is one of the glaring exceptions within developed states not to implement minimum wage. Of course, Singapore should not implement minimum wage because it does not want to be an exception, but the fact that it is currently an exception should inform decision-makers that they might be missing something out.
But even if we choose to look within, PAP’s respected Professor Tommy Koh has come out in favour of it. So has Associate Professor Hui Weng Tat from LKY School of Public Policy.
I have included links at the end of the article for readers to read more into the issue. The two experts can explain this far better, more in depth, and with much more credibility than I can.
The arguments against minimum wage (unemployment, higher costs of living) are important, but they oversimplify the situation. The economy is far more sophisticated and resilient enough to handle a minimum wage. Yes, the short-term effect of a minimum wage will be a degree of unemployment and higher costs of living – but a minimum wage is an important step towards reducing long-term unemployment and increasing productivity (as businesses have an incentive not to be overreliant on cheap labout – especially foreign ones). The argument to reduce exploitation of low wage earners, and to provide them with a fair wage, is not entirely just a value-laden one, but it can go some way to enhance the level of values and social responsiblity one feels towards fellow Singaporeans. I cannot speak for all, but for me, I would like to be in a more gracious society – and that contributes towards a better experience of life (intangible but important – something GDP can never capture).
Mitigating Unemployment
By defnition, a minimum wage will only have a direct effect on the wages of low-wage earners. However, many of the low wage jobs are necessary to businesses, especially service-oriented ones such as cleaning, sales assistants, etc. Businesses may reduce slightly the number of people they employ in the short term, but most of these jobs have to stay. Businesses have the incentive to increase productivity, and the private sector is very adroit at being able to
create jobs when they are productive. So the net direct effect on unemployment (even in the short term) is not a clear detrimental one.
Moreover, having a minimum wage also allows local workers to compete with foreign workers on a more even playing field – and if there is any short-term unemployment, the full burden will not fall solely on local workers. For example, a foreign service staff who is unable to speak English well may be willing to work at $4 per hour, and a local service staff at $6 per hour. If businesses value English-speaking abilities at $1 per hour per worker, then in this case, it is still in the interests of businesses to hire foreign workers over local ones. However, if there is a minimum wage that reduces the
comparative advantage that foreign workers have over local ones, then businesses will shift their employee composition to reflect a greater constituent percentage of local workers (increasing employment of Singaporeans) – which also has a greater benefit to consumers and society as a whole, not least since a
large foreign workforce (currently 25.7%) generates considerable negative externalities (effects) on society which economic indicators such as GDP or employment figures do not reflect – but the effect is still felt by the population and affects quality of life.
Mitigating Higher Costs of Living
Again, the short term effect will be higher costs of living, as some business costs will be passed on to consumers. But the bigger picture is less direct. With more pay, lower income earners will be able to spend more, increasing the rate of flow of money within an economy – and coupled with a multiplier effect (although this effect is admittedly not high in Singapore), this can have an upward effect on national income – which is beneficial for all. Empirical evidence (an indeed anecdotal ones) also suggests that children from more
disadvantaged backgrounds may also be disadvantaged when it comes to education and other enrichment opportunities. With more spending power and a reduction of the growing income inequality in Singapore, the long-term effect will be a more educated, skilled, and confident workforce – good news for all.
Costs of living is one thing, but there should also be a focus on the standard of living. The two are not as strongly related as most would assume. The long-term effect on the costs of living is not clearly a detrimental one, but I believe that the long-term effect on the quality of life is a strongly
beneficial one.
The Practical Way to Implement Minimum Wage
I do not expect all readers to agree with me, or the general case for a minimum wage, at this point. But even I think that minimum wage should not be abruptly introduced to allow businesses, the economy, consumers, and the public sector time to respond and react to it. A gradual introduction of minimum wage will dampen any detrimental short-term effects, whilst not denying the country the opportunity to benefit from the long-term effects that it can have.
It is understandable that there is no clear consensus on minimum wage policy, but I hope that readers agree with my proposal which allows minimum wage to be introduced over a period of time – which also allows it to be tried and tested during the time, and at any point, should it prove to start being greatly detrimental, the policy can be halted or reversed in the worst case.
The Proposal
(Figures are currently arbitrarily set for the purpose of discussion, and subject to revision)
The benchmark measure of minimum wage should be set at $6.80 in 2011 and increase annually with CPI, but will not come into force. BUT, the actual minimum wage being implemented and enforced should be set at $4.80 in 2011, but increase at a faster rate (CPI + 3%) until it reaches the benchmark figure in 12 years, and from then on, only the benchmark figure will be used. At any point in time should the rate of minimum wage prove to start to get greatly detrimental, or in a recession, the level of minimum wage can be capped for that year and not be allowed to increase, merely delaying the time needed for actual-benchmark parity. In the worst case scenario, if minimum wage is as catastrophic as opponents claim, this gradual approach will allow minimum wage to be scaled down or even entirely removed with less shock to the economy.
In any chance, even if one is doubtful about minimum wage, surely this presents an excellent way to try it out with little risk – and still giving the country the chance to explore its benefits.
Links
(1) http://www.spp.nus.edu.sg/ips/docs/media/yr2010/ST_Basic%20pay%20Tommy%20Koh%20weighs%20in%20_150910.pdf
(2) http://newasiarepublic.com/?p=20567
The writer is an undergraduate student in Economics and Politics at the University of Warwick.
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Current Affairs
Man arrested for alleged housebreaking and theft of mobile phones in Yishun
A 23-year-old man was arrested for allegedly breaking into a Yishun Ring Road rental flat and stealing eight mobile phones worth S$3,400 from five tenants. The Singapore Police responded swiftly on 1 September, identifying and apprehending the suspect on the same day. The man has been charged with housebreaking, which carries a potential 10-year jail term.
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SINGAPORE: A 23-year-old man has been arrested for allegedly breaking into a rental flat along Yishun Ring Road and stealing eight mobile phones from five tenants.
The incident occurred in the early hours on Sunday (1 September), according to a statement from the Singapore Police Force.
The authorities reported that they received a call for assistance at around 5 a.m. on that day.
Officers from the Woodlands Police Division quickly responded and, through ground enquiries and police camera footage, were able to identify and apprehend the suspect on the same day.
The stolen mobile phones, with an estimated total value of approximately S$3,400, were recovered hidden under a nearby bin.
The suspect was charged in court on Monday with housebreaking with the intent to commit theft.
If convicted, he could face a jail term of up to 10 years and a fine.
In light of this incident, the police have advised property owners to take precautions to prevent similar crimes.
They recommend securing all doors, windows, and other openings with good quality grilles and padlocks when leaving premises unattended, even for short periods.
The installation of burglar alarms, motion sensor lights, and CCTV cameras to cover access points is also advised. Additionally, residents are urged to avoid keeping large sums of cash and valuables in their homes.
The investigation is ongoing.
Last month, police disclosed that a recent uptick in housebreaking incidents in private residential estates across Singapore has been traced to foreign syndicates, primarily involving Chinese nationals.
Preliminary investigations indicate that these syndicates operate in small groups, targeting homes by scaling perimeter walls or fences.
The suspects are believed to be transient travelers who enter Singapore on Social Visit Passes, typically just a day or two before committing the crimes.
Before this recent surge in break-ins, housebreaking cases were on the decline, with 59 reported in the first half of this year compared to 70 during the same period last year.
However, between 1 June and 4 August 2024, there were 10 reported housebreaking incidents, predominantly in private estates around the Rail Corridor and Bukit Timah Road.
The SPF has intensified efforts to engage residents near high-risk areas by distributing crime prevention advisories, erecting alert signs, and training them to patrol their neighborhoods, leading to an increase in reports of suspicious activity.
Current Affairs
Consumers Association of Singapore fined S$20,000 for PDPA breaches following two data security incidents
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The Consumers Association of Singapore (CASE) has been fined S$20,000 by the Personal Data Protection Commission (PDPC) for breaches under the Personal Data Protection Act (PDPA).
According to a judgement which was published on 28 August, the fine was imposed due to the consumer watchdog’s failure to implement reasonable security measures to protect the personal data in its possession and to establish necessary policies and practices required under the PDPA.
The breaches resulted in two significant incidents, one in October 2022 and another in June 2023, where the personal data of up to 34,760 individuals was potentially compromised.
Both incidents were handled under the Expedited Decision Procedure (EDP) at the request of CASE, with the organization admitting to all the facts and contraventions of the PDPA, leading to a faster resolution of the case.
The First Incident: Phishing Attack in October 2022
The first incident occurred in October 2022 when a threat actor accessed CASE’s email accounts and sent phishing emails from its official email addresses.
On 8 October 2022, some consumers received unsolicited emails from “[email protected],” which falsely claimed that their complaints had been escalated to the “collections and compensation department” and that they were eligible for compensation.
The recipients were asked to provide their banking details by clicking on a chat icon.
The following day, similar phishing emails were sent from “[email protected],” an account used for complaints that had progressed to mediation. CASE later discovered that the phishing emails had affected up to 22,542 email addresses.
Further investigations revealed that the phishing emails likely resulted from the threat actor obtaining login credentials from a CASE employee via a phishing attack.
The compromised accounts led to the sending of 5,205 phishing emails to 4,945 recipients. Although CASE acted swiftly to suspend the affected accounts and reset all administrator passwords, three consumers reported that they had clicked on the phishing links and collectively lost S$217,900. CASE subsequently lodged a police report.
The Second Incident: Data Breach During Vendor Migration
While PDPC was investigating the first incident, a second breach came to light in June 2023. On 22 June 2023, PDPC received a complaint about a phishing email that replicated a consumer’s complaint previously submitted to CASE.
This led to the discovery that the personal data of 12,218 individuals, including names, email addresses, contact numbers, and complaint details, had been exposed. The PDPC concluded that the breach likely occurred during a data migration exercise conducted by CASE between December 2019 and January 2020 when CASE switched vendors.
Investigations revealed that CASE’s contract with one of its vendors, Total eBiz Solutions Pte Ltd (TES), did not stipulate clear security responsibilities. This lack of contractual clarity contributed to the data breach during the migration process, highlighting CASE’s negligent vendor management.
PDPC Findings and Penalties
The PDPC found that CASE had failed to enforce its password management policy, with some passwords not meeting minimum length and complexity requirements and others remaining unchanged for up to four years. Furthermore, CASE’s vendor management was deemed negligent, as one of its contracts did not specify clear security responsibilities, putting personal data at risk.
CASE admitted to not conducting regular security awareness training for its staff, with the last session held five years before the first incident.
The PDPC also noted that CASE lacked an Information and Communications Technology (ICT) policy, particularly in relation to patching and maintaining IT systems. The absence of a documented IT infrastructure management plan, insufficient logging and monitoring practices, and the lack of security reviews over the three years preceding the first breach were significant failures highlighted in the judgment.
In assessing the financial penalty, the PDPC considered the nature and gravity of the breaches, the duration of non-compliance, and CASE’s annual turnover. The fine of $20,000 was determined to be appropriate in light of these factors.
Remedial Actions by CASE
It is said that CASE, which is headed by Mr Melvin Yong, People’s Action Party Member of Parliament for Radin Mas, has implemented several measures to enhance its cybersecurity in response to the breaches.
These include introducing multi-factor authentication for all web-based applications, strengthening password complexity requirements, decommissioning end-of-life devices, and implementing patch management software for security updates.
CASE has also revised its contracts with outsourced vendors to include data protection clauses and mandated annual data protection training for all staff members.
CASE is working towards obtaining the Cyber Essentials Mark and the Data Protection Trust Mark to reinforce its commitment to safeguarding personal data and complying with PDPA obligations.
The PDPC has directed CASE to review and update its data protection policies, rectify all identified security gaps, and report back within one week of completion. The organization has also been instructed to conduct a penetration test after addressing the vulnerabilities to ensure no further security gaps exist.
The post Consumers Association of Singapore fined S$20,000 for PDPA breaches following two data security incidents appeared first on Gutzy Asia.
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