The central bank estimates that the living wage in Kuala Lumpur for a single adult is RM2,700, a couple without child RM4,500 and couple with two children RM6,500.
Malaysian government is responsible to ensure the financial and economic well-being of all Malaysians. This means that every Malaysians should have enough income to live reasonably in the country but alas the current Malaysian government has been failing in this respect. The truth of the reality of income of individual Malaysians and their families is not information easily available today. Today, all we get is 'Household Income' - and that is the total income of all persons in a household - which means that if there are 10 workers in a house earning RM1,000, then the household income is RM10,000. This is not helpful - because what we need is the income of individual worker, and maybe their spouses (not the income plus others including children who have to stay with parents because they simply cannot afford to get their own accomodation, or the income of people renting rooms?
Even, when it comes to household incomes, we usually get the MEDIAN household income(that means in a list of 100 households arranged from the lowest income to highest, the income of the 50th household in that list - we do not get the household income of the lowest, or number 10 or 20 or 30, which maybe so much lower than the median income. AVERAGE income is also useless...because if the household with the highest income earning RM100 million makes the average household income more than RM1 million - clearly not a correct indicator of the income of all Malaysian households, is it?
When the Malaysian Ringgit dropped in value, then it automatically reduced the real wages plus savings of Malaysian workers. The price of ice Kopi-O was 80 cents, but today it is more than double - the lowest maybe is RM1.80. But did wages of workers rise at the same rate - if it did not, then real wages or income of Malaysian workers have in fact dropped...so too has the real value of monies in his/her savings.
If a government keeps wages low, for reasons like attracting the foreign investor to invest in Malaysia, then naturally the government must also make sure that cost of living is also LOW - so Malaysian workers can continue to live with the 'low' wages...
One way still to determine, how much wages a local worker receives is to look at the EPF statistics - and, more than 50(maybe even 60%) of EPF contributors really earn less than RM2,000.
An increase of crime, especially crimes driven by poverty, like theft, purse snatching, robberies, etc ..is also an indicator, as most of the suspected criminals are still Malaysians(not foreigners) - but alas, now such crime statistics are also difficult to come by - now, this government provides us with a CRIME INDEX - and it is not helpful indicator to determine the amount of poverty driven crimes in particular states and towns...
Increasing MINIMUM Wages is a solution - but for the small businesses, like shops and restaurants, it must be noted that they may not earning sufficiently to cause a higher wage to be paid. Remember many small businesses also had to close down just because of the GST. The way forward is to increase minimum wages for just the bigger companies/businesses - maybe those that employ more than 10-15 workers or is showing an annual profit of more than RM100,000. For others, especially businesses in smaller towns, a profit sharing scheme with workers should be considered rather than a blanket minimum wages for all its workers - hence when less profits, workers get less...when higher profits more.
Recently Bank Negara came out with how much living wages is needed to survive in Kuala Lumpur - for a
single adult is RM2,700, a couple without child RM4,500 and couple with
two children RM6,500. It will be different for different parts of Malaysia...
UMNO-BN Najib, current Prime Minister, have been talking about a 'high incomed nation' - but this is not talking about increasing income of Malaysian workers and/or their families, or other Malaysians...is it?
Now, did any of the Opposition parties and/or coalitions take a position or comment anything about this disclosure by Bank Negara - Have the Opposition parties made sufficient commitment to workers - besides increasing minimum wages?
Pay living wage, Bank Negara tells bosses
The central bank says while minimum wage is still relevant, people should be paid so they can live comfortably.
More than a quarter of households in Kuala Lumpur are earning below the living wage.
PETALING JAYA: Bank Negara Malaysia (BNM) has urged employers to
consider the living wage, not just the minimum wage, when rewarding
their workers.
The central bank defines living wage as the level of income needed
for a household to afford a minimum acceptable standard of living.
BNM governor Muhammad Ibrahim said people should be paid so they could live comfortably.
The central bank estimates that the living wage in Kuala Lumpur for a
single adult is RM2,700, a couple without child RM4,500 and couple with
two children RM6,500.
“But it doesn’t mean that everyone should be paid according to these
numbers. It’s a number that equates the living standards in Kuala
Lumpur,” The Edge Markets quoted him as saying in conjunction with the
release of the bank’s 2017 annual report.
“The minimum wage is still relevant. But what we are trying to
advocate here is that when we pay people, we pay people decently. And
for Kuala Lumpur, this is the decent rate. It’s more of a guideline for
employers.”
It is estimated that more than a quarter of households in Kuala Lumpur are earning below the living wage.
In a study titled “The living wage: Beyond making ends meet”, BNM
said the wage growth in the bottom 40% of households by income (B40) is
just enough to keep pace with the rise in the cost of living.
BNM’s annual report said although the B40 group’s small increase in
average monthly income over the last few years might be sufficient to
keep up with inflation, it falls short of achieving a minimum acceptable
standard of living.
The study said a living wage could only be effective if it was set at
a realistic and sustainable level, adding that a higher wage should be
commensurate with higher productivity.
It warned that persistently weak productivity growth risked lower
wage growth, which could hamper the ability of households to have a
minimum acceptable living standard. - FMT News, 29/3/2018
MTUC on why local workers don’t get RM2,700 minimum pay
It says the government is to blame for the influx of foreign workers which has resulted in low wages.
MTUC
says although the service sector is well positioned to introduce the
minimum wage recommended by BNM, wealth is not distributed equitably.
(AFP pic)
KUALA LUMPUR: The Malaysian Trades Union Congress (MTUC) today blamed
the government for the large number of foreign workers in the country,
saying this has resulted in depressed wages for locals.
The umbrella body for private sector unions expressed surprise that
it had taken the government more than 20 years to realise that the
reliance on foreign workers had deprived locals of being paid the
RM2,700 minimum wage recommended by Bank Negara Malaysia (BNM).
MTUC secretary-general J Solomon said now that the government had
acknowledged the situation, it should set an example by ensuring workers
in government-linked companies (GLCs) and banks are paid a minimum
salary of RM2,700.
He said unions had, for years, been telling the government that the
influx of foreign workers was depressing the wage levels of Malaysian
workers.
“What steps did the government take to curb the inflow of foreign
workers since the 1980s? In addition to the misery caused to Malaysian
workers by this, just three years ago the government made an
announcement to bring in another 1.5 million foreign workers.
“Again, what action did the government take when unions voiced
concern about the exploitation of foreign workers? It only fell on the
deaf ears of the related ministries.”
Solomon was responding to a statement by Second Finance Minister
Johari Abdul Ghani on Monday, urging employers to reduce their reliance
on foreign workers and utilise technology to meet the minimum wage of
RM2,700.
Solomon said: “The government cannot blame anyone but itself for the
problems caused by excess foreign workers. This influx of foreign
workers has caused extreme depression to Malaysians in the B40 and M40
category, whose rights to job opportunities and decent livelihood were
robbed from them over the last 20 years.”
He said MTUC was surprised that “despite being the underlying cause
of the influx of foreign workers”, the government was now asking
businesses to pursue more automation so that they could pay better wages
and ensure a decent life for Malaysian workers.
“Is it a case of too little, too late or misdirected attention again?
MTUC welcomes technology but unfortunately the emphasis on technology
is not directed to the labour intensive sectors where there is high
dependency on foreign workers but rather in service sectors where there
are largely Malaysians working.”
He claimed that the government and employers in the service sectors
were aggressively using technology to the extent of laying off
Malaysians who had served them for many years.
“Making the situation worse, the service sector is even getting rid
of Malaysian workers and opting for automation and artificial
intelligence merely to compete with the Western world, under the guise
of remaining competent.
“The service sector is in a position to set an example by introducing
the RM2,700 as recommended by BNM as most service providers are
profiting in billions, not millions. Unfortunately, the wealth is not
shared equitably.”
Solomon said if Johari wanted to do justice to Malaysians, he must
first ensure that banks and GLCs under his ministry set the example by
providing a minimum living wage of RM2,700. This is especially so, he
said, as automation and technology had been a part of the bank scene
since 1980s.
“The need to reduce foreign workers in banks in order to enjoy the
BNM-recommended minimum wage does not arise as there are no foreign
workers in the banks.” - FMT News, 5/4/2018
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