Minimum wage – A comprehensive new deal

Media Statement by the Pakatan Rakyat Manifesto/ Policy Committee on 6 March 2012 in Petaling Jaya

Minimum wage – A comprehensive new deal

The Pakatan Rakyat Menifesto/Policy Committee in principle agrees with the plan of implanting minimum wage. However, we are in support of a virtuous cycle of high income, high productivity and high skills instead of a vicious cycle low income, low productivity and low skills.

For this to be achieved, minimum wage alone is not enough. As we have stated in the Pakatan Alternative Budget, apart from implementing the minimum wage RM1,100 per month, holistic reforms also needed to be implemented to the labour market. This includes strengthening the worker safety net, centered on retaining and upskilling, job search and relocation assistance, and unemployment insurance.

It is widely known that the current labour market is filled with cheap foreign workers which will displace local workers. In order for our objective to increase the dignity of our local workers to be achieved, this issue about foreign workers needs to be addressed.

From businesses point of view, funds will be allocated to a special Facilitation Fund to help entrepreneurs, SMEs and small firms retool, mechanize and adjust their operations to create new jobs. This is to address the concerns of most SMEs that the minimum wage will to these businesses closing down.

At the end of the day, we believe that these SMEs need to be empowered and be given incentives to increase their productivity instead of relying on cheap labour to be competitive.

In the long run, if our proposals are implemented, the minimum wage and training will increase local workers welfare and productivity. On the other side, business will move higher along the productivity chain and invest more capital, training workers and retaining them.

Rafizi Ramli
Dr. Dzulkifli Ahmad
Liew Chin Tong