The joy brought
about by the announcement of restoring our CPF rates in the Budget 2013 [Here]
was short-lived. It was naïve of me to expect PAP’s conscience to be pricked
overnight and thereby restoring our employers' CPF contribution rate to the pre-1999
rate.
Further details of
the Budget reveals that the government’s intention of restoring employers’ and the employees’ CPF contribution to the current rate only extends to those low-income earners. This in turn leads
to another fact discovery, at least for me, that employees earning less than $1500 per month all along are not entitled to
the same employers’ CPF contribution rate as those who are earning more than
$1500 of the same age group. The rationale of reducing CPF contribution
rates for low-wage workers is to “make them more employable”[Here].
And isn’t this a line which is overly-familiar to us?
Equal CPF contribution rate by employers and employees
Now going back to the pre-1999
employers' CPF contribution, specifically those years between 1994 – 1998
(Chart 1). It was a period where both employers and employees enjoy an
equivalent CPF contribution rate. It was also a significant period for me as I
entered the workforce, living through the detriments of CPF changes and with
the trust in PAP gradually eroding by the actions evinced by the incumbents.
Chart 1(Source: CPF Trends and Highlights)
The Asia financial crisis struck in 1997, leading to the
change of the CPF contribution proportion in 1999. 10% employers’ CPF contribution
was taken off in one shot (Chart 1).
The proportion of CPF
contribution between employers and employees changed several times during the
life time of our CPF and I won’t even look back at the era where the proportion
of the employers’ contribution surpassed that of the employees' but staying focused
on the pre-1999 rate as that was the period where both employers and
employees share the equal burden of CPF contribution.
In the midst of the
Asia Financial Crisis, the same rhetoric of improving employee’s employability during
hard times was used and employees were expected to take the brunt which to be
fair, might be a genuine call then. There are times when individual sacrifices
must be made for the greater benefit of all. However, as we know that the CPF rate
has never been restored to the pre-1999 rate till this date and in retrospect, the
Asia financial crisis became the golden
opportunity for the incumbents to slash off the price of our labour for good for
the sake of improving our “competitiveness”.
Between 1999 and
2013, one and a half decade has passed during
which our Cabinet has generously increased
their salaries twice:
(1) In 2000, PM (Goh Chok Tong) received a pay
rise of 14% from S$1.7 million to S$1.9 million. [Here]
In that same year, employees were returned with a peanut 2% of their employers’ CPF contribution. 2% restored out
of the 10% (Chart 2) deducted whilst PM’s
salary jumped by 14%, demonstrating PM's greater interest of his own salary than the people’s.
(2) In 2007, PM (who is Lee Hsien Loong by this
time) saw a 25.5% jump [Here] in his
salary to S$3.09 million whilst restoring a mere 1.5% of employers’ CPF contribution to the workers bringing the employers’
CPF contribution to a 14.5% (Chart 2).
Chart 2 (Source: CPF Board)
In between 2000
and 2007, our economy was hit by another round of recession in 2003 and our workers
suffered CPF cuts again on the employers' contribution side by 3%, after
regaining 6% in the previous 3 years. PM’s pay was reduced by 17% in 2001 [Here] , taking
the “brunt” alongside with the workers. Nevertheless, he subsequently rewarded himself
substantially for his “sacrifice” and by
2010, he was already earning S$3.07 million, an 80% increase from the 1998’s S$1.7million figure. In that same
year, our workers saw a mere climb of 0.5%
in their employers’ CPF contribution.
Pace of CPF restoration and GDP growth
Seemingly,
recessions became useful excuses to cheapen our local labour price.
Our GDP went into a
negative 2.2% in 1998 (Chart 3). By 2000, our GDP made a rebound to 9%, yielding an
overall GDP amount of S$165, 358.9 million, surpassing the pre-recession figure
of S$145, 964.8 (Chart 4). For the effort of enduring a 10 percentage pay cut
in 1999, our workers were rewarded with only a 2% restoration to their pay in
exchange for a 9% GDP growth.
Chart 3 (Source: Singapore Department of Statistics, updated as at 22 Feb 2013)
Our overall GDP
figure grows each year for 12 out of the 15 years (negative growth for 1998,
2001 and 2009) between 1998 and 2012. By 2012, our GDP overall figure has doubled the 1998 figure. Ironically, employers’
CPF contribution has only been restored by 6% and we are still shortchanged of 4%.
GDP grows in leaps
and bounds since 1999 while the pace for CPF restoration has been excruciatingly
slow. And I won’t be surprised that I
will not live to see the daylight of the last remaining 4% of our employers’ CPF
contribution being restored to the pre-1999 rate. This amount was deducted off
our pay under the pretext of the welfare of our economy. Coincidentally, PM’s
pay has grown by 80% in the duration.
The incumbents who expect our workers to tighten their already-tight belts to tide the country over
the bad times are the ones who entitled themselves to the larger share of the economic pie while casting the meagre crumbs for the workers. It has to be
disdain that the incumbents have for our people to enrich themselves at the
expense of the people. Not merely in failing to restore our CPF rates but also by eliminating
the price bargaining power of our local labour with the open-door policy to
cheaper foreign labour.
Practising what they
preach is often not the case with the incumbents. And LHL said just this Jan during the Punggol East by-election that the PAP has
stood on the side of the people [Here].
I genuinely believe that he must have sincerely thought that he was behind us. By
standing on the employers’ side and kicking us into the dirt from behind.
