KUALA LUMPUR: Bank Negara Malaysia (BNM) is refuting a news report published on April 4, which said that its analysis on the living wage suggests that Malaysians are poor.
In a statement today, the central bank said the living wage was a benchmark on the income needed to attain a minimum acceptable living standard.
“It is not a benchmark to assess the extent of poverty. In addition to meeting basic needs, the living wage also provides for a meaningful participation in society, the opportunity for personal and family development, and freedom from severe financial stress.
“It is important to understand the concept fully so that any comments on the issue will not mislead and cause confusion,” BNM added.
It said the living wage mainly served as a guide for employers to consider paying employees according to the needs of a minimum acceptable living standard.
“The living wage does not supersede the relevance of the current minimum wage of RM920 - RM1,000. The minimum wage is legally binding and aims to address the basic needs of households,” it said.
BNM said the ability to pay a living wage should be assessed with due consideration to employees’ productivity, so that it does not translate into an unwarranted increase in cost that might lead to higher inflation.