GE2025: PM Lawrence Wong on tackling cost of living concerns

AsiaOne

At the People's Action Party's (PAP) lunchtime rally on Monday afternoon (April 28), Prime Minister Lawrence Wong set out how his party will "take decisive steps" to tackle economic uncertainties, including cost of living, if given the mandate.

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00:00Our key priority is to tackle cost of living concerns and we started this work earlier.

00:09I had announced a comprehensive package in this year's budget.

00:14The measures all of you are familiar with will be rolled out in the coming months.

00:20The opposition says all these cost pressures.

00:24Blame the government.

00:26Blame the GST.

00:28But look, inflation here was largely important.

00:33It's due to conflicts and wars overseas, due to global supply chain disruptions.

00:39And you can look around you, countries everywhere are experiencing this too.

00:45It's not a Singapore phenomenon.

00:48We've dealt with this important inflation through sound monetary policies.

00:54And it's working because inflation here has been coming down faster than in many other places.

01:05The GST was not easy.

01:08It was a very difficult decision to make.

01:10We thought very hard about it.

01:14But we did it because we needed the revenues to take care of all our seniors and the number of seniors are growing very quickly.

01:24At the same time, we took great care in the implementation of the GST increase.

01:29Because the GST increase was accompanied by enhancements.

01:34Enhancements to permanent GST vouchers which we give out to lower and middle income households.

01:41Because of these vouchers, lower and middle income households pay less than the headline rate of 9% GST.

01:52Who pays the full rate?

01:57Three groups.

01:58Foreigners, tourists and higher income families.

02:04The opposition wants them, these three groups, to pay a lower rate.

02:10Would you?

02:12I wouldn't.

02:14I think it's fair and right for them to pay the full rate.

02:19But for lower and middle income Singaporeans, we protect you, we shield you, we give you permanent GST vouchers in cash.

02:27And that means you pay an effectively lower GST rate.

02:32That's how our GST system works.

02:41And by doing this, overall we ensure a fair and progressive system.

02:47Today, our public finances would be weaker.

02:52We would have a funding gap.

02:54That means insufficient resources to take care of all our seniors.

02:59That means insufficient resources to support you even as we enter into this economic storm.

03:07You know, I've said that the support package in the budget is not a one-off thing.

03:13That we will continue the help for as long as it is needed.

03:17That if conditions worsen, we will be even prepared to do more and we have drawer plans ready to be activated.

03:23Why is it that I can give you this assurance now?

03:32It's only because we made the tough and responsible decisions earlier to ensure that we have sound public finances.

03:43And that's why today, we can confront the challenges ahead with confidence.

03:49We have the resources to support you.

03:52We have the resources to steer Singapore safely through this crisis.

03:56There is one other point I will make on cost of living treasures.

04:00For many businesses, all of you running businesses, you will know, a key cost driver is local wages.

04:10You look at all the opposition manifestos, or certainly most of them, many propose a minimum wage across the board by law.

04:19Now, we want to uplift lower wage workers, don't get me wrong, the PAP wants to do it.

04:26We have put in place good systems to do so.

04:29We have workfare, additional income for lower wage workers to boost their incomes.

04:35We have progressive wage models, sector by sector, which we have implemented, which are showing results.

04:42They have been working well.

04:44But the opposition party says this is insufficient.

04:48They want a minimum wage across the board by law.

04:52One proposal says set the minimum wage at $2,250 a month.

04:59It sounds good on paper.

05:01I would like to lift wages up too.

05:03But you know what will happen if we implement this?

05:06By law.

05:08Companies will have to pay more for their workers.

05:12Their costs will go up.

05:14How do they recover the costs?

05:16They can only recover it by raising prices on the goods and services they sell to Singaporeans.

05:25How does this solve cost of living pressures?

05:28It will only make things worse.

05:34In fact, the companies will not only raise prices, they may even cut back on hiring lower wage workers,

05:41because lower wage workers are now more expensive, and that can mean fewer jobs, more unemployment,

05:48among those who are least able to cope with this.

05:54These are things the opposition will never acknowledge, of course.

05:59The manifestos have many details.

06:01A long wish list.

06:04But are they feasible?

06:06Are they viable?

06:08Are they sustainable?

06:10Will there be negative outcomes?

06:13Please think about it.

06:15For all of you working here in the Business and Financial District of Singapore,

06:21you know, if something sounds too good to be true,

06:26it probably is too good to be true.

06:29There is no such thing as a free lunch.

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