The NWC's History

“The spirit of tripartite partnership was fostered and strengthened over the years through the National Wages Council… This is a unique system which has served us well and has been our competitive advantage. We should not take the co-operation for granted. We should preserve and strengthen this valuable institution so that can continue to benefit business, workers/unions and the economy.” - Mr Lee Kuan Yew

In February 1972, the National Wages Council convened for the first time to deliberate and forge national consensus on wage guidelines for employers to meet the needs of businesses, workers and the economy. Since then, the NWC has convened annually to release its guidelines, and played a critical role in fostering tripartite partnership and collaboration in Singapore.
Our harmonious labour-management relations wasn’t always the way it is today. The late 1960s and early 1970s were a time when Singapore was undergoing a period of rapid industrialisation, which had resulted in rising wage expectations.There were concerns that high wage expectations would lead to serious industrial disputes, which could dampen the investment climate and adversely affect Singapore’s economic progress. Wage and benefit negotiations were typically carried out in an adversarial manner by individual trade unions with companies in which its members were employed. The negotiation outcomes often depended on the bargaining strengths of both parties and the ability and willingness of the employer to pay. There was little regard for the bigger picture of economic sustainability.**
It was a Dutch economist, Dr Albert Winsemius, who first mooted the idea of having a national wages council. Dr Winsemius first arrived in Singapore in 1960 under the United Nations Development Programme to survey Singapore’s industrialisation potential and come up with an eocnomic development strategy. He would go on to serve as Singapore’s chief economic advisor in the early post-Independence years. In Dr Winsemius’s view, the council would be a tripartite body that would not only regulate wages but also give advice on how to enhance market efficiency, productivity and human resource development.
On 7 February 1972, it was announced that a National Wages Council (NWC) would be set up as an advisory body on wage adjustments. The NWC would formulate wage guidelines for employers and workers that were in line with long-term economic growth, so that Singapore’s economic and social development would not be undermined.
To find out more, please read The Story of NWC.