The MOM has responded to calls for a minimum wage on its blog:
In a reply by Minister Lee Yi Shyan, he wrote that minimum wage "distort market mechanisms and also makes the labour market more rigid. In fact, it can even hurt employment opportunities for low-skilled workers, making it harder for them to find jobs". A minimum wage, if properly set, is the income required for decent living in Singapore. It only distorts the market and hurt the employment of workers when you have an economy dependent low wages and many workers currently employed below the minimum wage. If the govt had achieved growth in the economy by raising productivity and fostering innovation, the number of low wage workers will be small and setting a minimum wage will only affect the workers at the margin by pushing up their wages. The PAP govt is unable to implement a minimum wage because a large segment of the workforce does not make enough for decent living. Why do we have this problem? The PAP govt opened the floodgates to cheap foreign labor to grow the GDP disincentivising businesses from making investments to raise productivity and retained industries dependent on cheap labor. It is disingenuous now for the Minister to say he is worried that a minimum wage will "hurt employment opportunities for low-skilled workers"....they have already hurt these workers by importing cheap labor causing their wages to be depressed.
The minister also cited workfare as alternative to minimum wages. If you go to bus interchanges these days, you see big posters telling workers they can get up to $3200 per annum from the Workfare Income Supplement (WIS) subject to various conditions. Workfare is a pro-business scheme because it uses tax dollars to supplement income and businesses pay the same low wages to workers. The result is businesses have no incentive to improve productivity and workers are locked into menial jobs. For this reason, the harshest critics of workfare call it "slavery"[Link, link, link].
The minister wrote that the unemployment rates in western countries with minimum wages were high (8%)prior to the current recession. There are countries without minimum wages and high unemployment and there were periods when countries had low unemployment and minimum wages (US, 1996-2006). High employment rate itself does not deliver quality of life when a large segment of workforce(20% of workers) don't make enough for decent living and many who now make a decent living won't make enough to retire at an advanced age.
Unfortunately due to PAP own past policies which caused the income inequality to be the highest among developed countries and the economy to become dependent on low wage imported foreign labor, the PAP govt will now strongly resist having a minimum wage.