- NCMP Leong Mun Wai suggested imposing a levy on Employment Pass holders as a way to reduce the wage disadvantage he said is faced by Singaporeans
- He said that the Government’s efforts to rebalance local-foreigner ratio are moving “too slowly”, citing foreign chiefs at local banks as an example
- Transport Minister Ong Ye Kung, who is an MAS board member, said that Mr Leong’s comments were grossly unfair
- He said Mr Leong and his Progress Singapore Party are simply asking for Singapore to move away from being an international financial hub
SINGAPORE — To correct what he considers a “wage disadvantage” faced by Singaporean workers, Non-Constituency Member of Parliament Leong Mun Wai suggested on Thursday (Feb 25) that the Government could impose a levy on Employment Pass (EP) holders as efforts to rebalance the foreign-local workforce ratio are moving “too slowly”.
Mr Leong cited the financial sector as an example of how, in his view, the rebalancing is not taking place fast enough and that localisation is not on the agenda of the Monetary Authority of Singapore (MAS), which regulates the sector.
His comments, made during the Budget debate in Parliament, drew sharp rebuke from Mr Ong Ye Kung, an MAS board member, who said that the opposition politician from the Progress Singapore Party (PSP) remarks were “grossly unfair”.
Mr Ong added that Mr Leong was simply asking for Singapore to move away from its status as an open economy that is an international financial hub.
REBALANCING LOCAL-FOREIGNER WORKFORCE RATIO
In laying out PSP’s policy suggestions during the Budget debate, Mr Leong said that local workers have a wage disadvantage as employers need not contribute to the Central Provident Fund (CPF) of their foreign workers.
Not having to pay a levy for EP holders is “a loophole” that employers make use of to the disadvantage of Singaporeans, Mr Leong said.
He said that PSP proposes imposing a S$1,200 monthly levy on EP holders, which he estimated would generate S$2.7 billion of revenue for the Government every year.
“This levy will differentiate the true foreign talents, who are high-salaried and less affected by the S$1,200 levy, from the foreign talents who are simply cheap labour that compete unfairly with Singaporeans and whom our economy has become overly dependent on,” he said.
Mr Leong’s suggestion prompted Minister of State for Manpower Gan Siow Huang to defend the EP system. She explained that the Ministry of Manpower regularly reviews the qualifying criteria for EP holders in its efforts to constantly rebalance the local and foreigner mix.
She added that imposing a blanket levy on all EP holders would be sending a signal to foreign investors that Singapore does not welcome them to bring their own talents here.
Ms Gan also brought up an earlier controversy surrounding Mr Leong, when he said, in his maiden speech in Parliament last September, that he was disappointed that Singapore’s largest bank DBS did not have a home-grown chief executive.
The current chief executive officer (CEO) of DBS is Mr Piyush Gupta, who was born in India but became a citizen in 2009 after many years as a permanent resident here.
“I cannot help but come to the conclusion that Mr Leong and the PSP do not believe that Singapore should be an open city, connected to the world, having locals and foreigners complementing each other. And he wants Singapore to close up for the top jobs to be given to Singaporeans only,” she said.
Mr Leong clarified that he is not against foreigners complementing the local workforce, but that he believes the efforts to rebalance the workforce between these two groups are not moving fast enough.
He also questioned whether there are policies to ensure Singaporeans are treated fairly compared to foreigners.
Bringing up the case of OCBC Bank recently appointing Hong Kong-based Helen Wong to be its next CEO, Mr Leong again questioned whether there is a preference for employers to hire foreigners, particularly in the financial sector.
“What is MAS doing? … During my time in the eighties and nineties, localisation is almost a must in our financial sector,” he said.
“Today, there doesn’t seem to be even a KPI (key performance indicator) among MAS officials. That is what PSP and I are concerned about. The rebalancing. And we have to do the rebalancing as soon as possible and as fast as possible.”
This prompted Mr Ong to rise and issue a sharp rebuke to Mr Leong for his remarks, which he said were “grossly unfair” and “grandstanding”.
Admitting that he is “a little disturbed” to hear them, Mr Ong said MAS has put in place several initiatives to open up Singapore and establish it as a financial sector, and get universities up to speed in terms of producing enough finance graduates.
But with the opening up, he said that competition is tougher.
“Of course, we always wish there’s a menu that says we get all the jobs but yet no competition. But I’m sorry there is no such menu. The menu is open up, more competition, but we build capabilities and we can seize more opportunities,” said Mr Ong.
Mr Leong then apologised for his remarks on MAS, but said that more can be done to increase the proportion of locals in the finance sector.
For example, he questioned why foreigners make up 30 to 40 per cent of senior executives in retail banking, and not a lower proportion, when the business segment is mainly catering to the domestic market.
In response, Mr Ong said it is essentially because Singapore is a global financial centre.
“I think I also come to the same conclusion as MOS (Minister of State) Gan Siow Huang that actually the PSP position is that I think you want Singapore to close up and protect the jobs, which is fine. It’s entitled to that view. But I think the Government and MAS have a different view,” he said.
He also accepted Mr Leong’s apology and thanked him.