A Nithiah Nandan
Singapore
“On this, the Manpower Ministry has to give its Conciliation Officers more powers, so that they can take to task employers or their representatives who are not showing the kind of support that they should give to good industrial relations practices. It is not just by signing papers, because this is not a legal document.”
“This need for cash deposit should be reviewed, and the use of Medisave should be considered for expensive outpatient treatment. Another factor to be reviewed is the difficulty one faces if he chooses to downgrade to a subsidised ward later if he faces hardship.”
“If the economy continues to do well, they look forward to the Government announcing some rebates or benefits during the National Day Rally speech by the Prime Minister. Sir, I support the motion. Column No : 783 VISIT OF MR ARUN SHOURIE, MINISTER OF DISINVESTMENT AND COMMUNICATIONS & INFORMATION TECHNOLOGY, INDIA (Presence in Gallery)”
“I would like to thank the Deputy Prime Minister for his kind gesture. Column No : 3121 FINANCIAL LITERACY OF SINGAPOREANS (Improvement and education) 4.”
“It must look at the current costs of essential goods - medical cost, public transport, and the cost of education - and see how best it could be adjusted to defray the day-to-day expenses of the workers in taking care of themselves and their families. To what extent is the Government prepared to absorb such costs?”
“I hope the Agency will give its due consideration for job redesigning and retraining of workers so that Singaporeans could take up jobs currently done by foreigners.”
The complete record
Every one of 92 lines we hold for A Nithiah Nandan, in date order, each linked to its source. Free to read, in full, without an account. Page 1 of 2.
“Now there are abundant resources that a worker can be eligible for if he wishes to upgrade his skill. The end result is that we have been rated many times as theNo. 1 workforce in the world. This attracts investments to Singapore, hence creating jobs. Another significant initiative that marks your attachment to the labour movement, as mentioned by my colleague, Mdm Halimah, and which all ordinary workers appreciate, is the promise that you made to NTUC to have a new office building right in the business district. Now that promise is a reality that stands tall -the NTUC Centre atOne Marina Boulevard. I am not aware of any country in the world where the Prime Minister or any other leaders have extended such an exemplary gesture to the trade union movement. SM Goh, you stand above the rest, not by your high priorities. Another key initiative introduced during your tenure of premiership is the introduction of NMPs in Parliament. Your objective of giving different interest groups the opportunity to voice their views in Parliament is laudable. These and other measures introduced, so that ordinary people can give their views and raise their concerns, speak volumes of your consultative style of governance. Sir, SM Goh's service to Singapore and Singaporeans is like an ever-flowing river. It is impossible to condense it in a text. All I manage today is to just take a few drops from this river and sprinkle it here. Senior Minister, I humbly wish to express my gratitude to you for all the contributions you have made to all Singaporeans as a whole and to the nation. You have made this little red dot of ours a symbol of peace and racial harmony that the world should take it as an example.”
“As a union leader, many affected workers have expressed to me their gratitude for the assistance you provided. It is your personal approach leadership and a ready listening ear that give us the will to face whatever challenges that come. I can personally attest to this because you have many a time shown your concern and asked me about the workers' plight and problems. During good times, you made it a point to share the wealth of the nation with all. And, in difficult times, you provided assistance to the needy, some of which I will reflect here. Under your administration, many schemes were initiated that were meant to help the ordinary workers and the lower income. Schemes, such as Medifund, Edusave, service and conservancy charge rebates, utility rebates, etc, were introduced. The Edusave Scholarship is also extended to the students in the Normal and Technical streams. It clearly showsyour vision for academic achievements for our future generations, that the opportunity should be there for all and not just for an elite few. By your concern and care for this group of children, you have given the assurance that they too are important and they have a role to play in the building of a nation. At the same time, efforts were made by you and your administration to see that, irrespective of educational level and age profile of the ordinary worker, provision must be there for them to upgrade their skills. In these respects, funds, such as Lifelong Learning Fund, SRP Fund, etc, made it possible for workers to upgrade their skills and to remain employable. In particular, your offer of $3 for every dollar raised by the NTUC Education and Training Fund reflects your great support for the labour movement.”
“Mr Speaker, Sir, I am greatly honoured to be given this privilege to convey these few words sincerely from my heart to our Senior Minister Mr Goh Chok Tong, and I strongly believe that what I am going to say would be what the ordinary workers would express to him, if they were given the opportunity. Aseveryone of them cannot be here, so allow me to recap what the earlier speakers said and refocus on some exemplary things thathe has donefor Singapore. For a great leader, his character will be better understood during a crisis.He hasshown it during a crisis and let me elaborate on it. Senior Minister, during your premiership, the nation experienced a period of strong growth as well as downturn in the economy which was not our own doing. That was the Asian financial crisis. Then came the SARS crisis whenhigh unemployment took place in the service sector. The impact on the labour movement was tremendous. During the financial crisis, you called for a CPF cut and, in 2003, you proposed a retuning of the CPF, knowing it would cause dissension. But you took that step, unpopular as it was, in order to save jobs. At that time, many might not have understood, but now all realise the necessity of such a move. Many jobs were saved and new ones were created. Workers gained confidence in you and the Government. The nation managed to ride the wave. Then, when we were faced with the SARS epidemic simultaneously with an economic downturn, workers in the service sector had to make several sacrifices, and some even lost their jobs. But your sincere call to all Singaporeans to rally together and face the calamity, gave us the strength to overcome it. Financial help through Government agencies gavehelp to those who really needed it.”
“On this, the Manpower Ministry has to give its Conciliation Officers more powers, so that they can take to task employers or their representatives who are not showing the kind of support that they should give to good industrial relations practices. It is not just by signing papers, because this is not a legal document. And if it is not a legal document, employers will just talk about it and after that, they will forget about it. I think we should not allow that to happen. If we are sure about the amendment, make sure that it is balanced - the interests of the workers are taken care of and, at the same time, the employers' interests are also taken care of. But the employers must also exercise their responsibility and give a proper mandate. Sir, in conclusion, I just wish to state that in my view, a leader without a mandate is similar to a body without a head. On that note, I support the Bill.”
“But at the end of the day, we have to make decisions. And to make decisions, we need a mandate. So, this amendment, I believe, is long overdue. In fact, it should not have taken such a long time to amend this law. But at the same time, some other concerns have been raised. One of the concerns has been highlighted by Mdm Halimah. As far as union leaders are concerned, they have a clear mandate. What about management? Lately, we notice that some employers are more concerned with shareholders' interest. Their primary concern is on shareholders' interest, not so much for the other stakeholders, especially the workers. So, they are not giving a clear mandate to human resource heads to negotiate with the unions, and this has caused a lot of disruption in the workplaces. The Acting Minister has circulated a Code of Industrial Relations Practices. But this is just a piece of document. You just sign and then you keep it in your file. It does not serve anybody's interest. You must make sure that it is put into real practice. Because by issuing this statement, tomorrow, everything is not going to change. Those reluctant employers must change their attitude, and must give a clear mandate to their human resource director to negotiate. If they do not have a mandate, then there is no point in blaming the unions or the union leaders. So, this is very crucial for harmonious industrial relations. We have decades of industrial harmony and peace, and we have enjoyed prosperity and growth. On the average, we have enjoyed about 5% wage growth since the NWC started in 1972. All this could not have been possible without cooperation and clear mandate. But, going forward, with a very competitive environment, we see a lot of difficulties arising.”
“To do that, we had to take some very tough decisions. At that point of time, this group of workers was working from 7.00 am to 2.50 pm and thereafter, they did a second job. So any training programme or any change in their working hours to attend a training programme will become very disruptive.But then the collective benefit of all the employees and their long-term benefits have to be taken into account. So, we decided to discuss this with the management, and the management too had a strong mandate. The director had a very strong mandate from the management and he understood the problem. He knew that was the right direction, and he was able to convince his senior management. From 1992 to 1997, about 1,800 daily-rated workers were trained and retrained. After which, they were able to acquire monthly rated positions, which were more secure jobs, and they were also able to enjoy higher wages. If they had not gone through the changes and attended the training programmes, today, they would be earning between $1,000 and $1,400. But by accepting the changes and accepting the union leaders' decision, today, they are able to enjoy salaries of between $2,000 and $2,700, and this is a hefty increase. All this was possible because the union leaders had the mandate. In my own experience, since 1979, I have negotiated over 20 collective agreements, and went through nine elections. If the workers' interests have not been taken into account, that would not have been possible. The union constitution provides sufficient provisions for the whole executive council to be removed by the ordinary members. And we have to make sure that we are close enough to our members, close enough to even listen to their pulse, and this is important for a union leader. We have to hear views and feedback.”
“Sir, how critical is it for leaders to have mandate to deal on behalf of their members, as a clear mandate allows different partners in a negotiation to resolve issues in a harmonious way for the mutual benefit of both partners concerned? These are important questions. We need to reflect on our past experience to see what has happened in the past in many of the affiliated unions in NTUC. Here, I wish to share my own experiences. Sir, in 1985/1986, we went through a severe economic recession. At that point of time, I was a leader with the then PUB Daily-Rated Employees Union. We had to take tough decisions. One of it was to accept a wage freeze and to forgo the mid-year bonus for these low-income workers. The union leadership had to take a decision, and we took a decision which was, no doubt, tough and unpopular. With that and other tough measures introduced, such as the CPF cut, the Singapore economy rebounded and a lot of progress took place. The PUB Daily-Rated Employees Union in 1989 negotiated a collective agreement on behalf of its members. Through that collective agreement, workers managed to enjoy a pay increase of between 18%-21%. All that came about because a very strong harmonious industrial relation existed. We were able to take tough decisions, and we had the mandate to take tough decisions. This was one of the examples we went through. Then, in the 1990s, we wanted to take away this daily-rated concept because it was a misnomer of our colonial days. The union discussed this issue with its Executive Council and we decided that we could not do it by wage increase alone and we needed to address a more fundamental issue of helping the workers to go through training, whereby they could adapt to the new technological changes taking place in the market.”
“00 noon I wish to also express a concern when implementing the scheme of tying the annual increment and bonuses to the individual worker's performance and the company's performance. It is an understandable fact that appraisal on performance of a worker can be subjective. In fact, the appraisal system is in its infant stage in Singapore. Unions have a tough time persuading the workers to accept it. I would urge the Acting Minister for Manpower and the tripartite committee on wage restructuring to work on formulating a standard guideline on the appraisal system, so that companies intending to introduce the appraisal system could use it as a guide. The Ministry must also have some form of mechanism to check on errant employers who may abuse or manipulate it to suit their gains. This is an important element as it relates to wage restructuring. I call upon the Minister to give a clear indication to employers that the implementation of wage restructuring is not an opening for them to cut benefits and wages, but is an important instrument that would be useful in times of economic downturns. It must not undermine the principle of equitable and fair wages to workers. The Acting Minister for Manpower has a target to reach by the end of this year, whereby his bonus will be dependent on it. I believe DPM Lee will consider giving him a higher bonus if quantity is matched by quality. Flexible Wage System”
“Sir, the hon. Members, Mr Gan Kim Yong and Mr Seng Han Thong, have mentioned about wage restructuring. But I think it is worth reiterating the points again as a lot of workers have raised concern on this. I hope the Acting Minister for Manpower will take these points seriously. Sir, DPM Lee's call for wage restructuring was positively responded by the unions. We appreciate the need to implement a flexible wage structure. The principle and basis of this acceptance to go into flexi wage system is to help companies remain cost effective in case of an economic downturn. This, we believe, could also help to contain retrenchment. However, wage cost is not the only factor that would have an impact on the company's performance. There are also other related costs. What is important is that if wage restructuring is seen and deemed to be looked upon as a wage cut by the employees and the employers also take it as an opportunity to cut wages, it would have a negative impact on productivity. Workers may feel rejected. Another factor in relation to wage restructuring is the monthly variable component. It is sometimes quite apparent that employers would seem to be reluctant and vague in their response when the introduction of MVC is mentioned. Sir, the Ministry of Manpower must enlighten the employers that such negative perception and conclusion on wage restructuring would not benefit them. As we are prepared to allow a substantial portion of our salary to be variable and to be cut, in the event of the company becoming unprofitable or in financial need, employers must not take advantage of this at the expense of the employees. 12.”
“And today, we have 109 Singaporeans undergoing training to be nurses, 19 to be radiographers, another 100 are targeted to start nursing training in July this year. We have also extended this to the hospitality sector. WDA and the Singapore Tourism Board launched a number of executive development courses, targeted at local executives working in the hotel industry. A new work study programme is also in place to help attract executives into the hotel industry, and this is a diploma programme. We will consider similar programmes in other sectors. We will also help fill PMETs into job vacancies. We helped about 2,000 in the last three months of this year. Yes, we will work with universities and polytechnics to give more information to companies so that they can understand the challenges. WDA also collaborates with Singapore Professionals' and Executives' Co-operative (SPEC) to establish a talent centre. Under this programme, SPEC will outreach to various employers to secure both permanent and contract employment opportunities, specifically for PMETs. We will provide six months of wage support to companies who employ older PMETs. Madam, some Members have asked about 'S' pass. I propose to defer that because there are further questions down the road.”
“For example, in the healthcare sector, both clusters - the National Healthcare Group and SingHealth, this is the age of equal clustering - have been taking in mature workers to make career conversion programmes. Other employers should follow their lead and rid themselves of the unjustified prejudice against mature workers. Ms Irene Ng asked why not set up an Equal Opportunities Commission. She says that the United States is a beacon of that process. We looked a bit closer at this beacon. In 2001, the Equal Employment Opportunity Commission received 81,000 complaints. 7% of these complaints showed that they had reasonable cause and, finally, after all the hudgy-pudgy, 0.4% or 370 cases resulted in direct suits. The reality on the ground is that it is very hard, and she asked, can you fault the employers. If an employer does not want to hire someone, he can use many reasons. It is very difficult. So, the point is not to start a commission. Because after doing all this work, it is just difficult. The key is to give our mature workers intrinsic, inherent, indigenous values. That is their premium and they can go to a number of sectors and get employed. Mdm Ho Geok Choo and Mr Heng Chee How asked about professionals, managers, executivess and technicians (PMETs). They are quite right. The last three years saw an increase in the incidence of retrenchment in this group, mainly because of the reorganisation and restructuring in the financial and ICT industries. Members have asked what programmes are there to cater specifically for them, as well as for people with higher degrees, as Mr Nithiah Nandan has asked. We have specific programmes, like the skilled manpower conversion programme. We launched it with healthcare.”
“More importantly, it has improved compared to 2001. In 2001, the re-employment rate for this group was 43%. There was a 13% jump. And it proves the point that growth stimulates jobs. But the numbers also tell us that the People-for-Jobs-Traineeship programme has helped. I know you have heard the figures, but allow me to gloat a little. It is a good programme. We provide basically wage support to allow these workers to prove themselves for six to nine months. Yes, we benefited about 16,000 older workers, 57% stayed beyond the six months of wage support. I will study, as Mrs Irene Ng has suggested, what happened to the other 43%. This glass is a little more than half full, but I will also look at the other portion which is empty. Apart from this, we are looking again at sector specific industries that can give jobs for these workers, for example, the textile industry. 77% of the participants of the Place and Train programme are workers above 40 years old. After three weeks of training, which is not very long, they are employed as sewing operators. And I understand that the entire batch is still working on these jobs. But our move away from the seniority based wage - our wage restructuring efforts - needs to be seen in this light, that it will help hire and re-employ many mature workers. We will also extend our job preparation exercises, as I have mentioned, in the electronics sector. About 30% of job seekers in the electronics sector were 40 years old. And I echo the sentiments of Members of this House who say that employers must change their mindsets. I also want to acknowledge that there are many enlightened employers.”
“This is another area I want to reclaim as well. I want to thank Mr Ang Mong Seng, as he has been active in this. It is his passion. Mr Lim Swee Say, once a unionist, always a unionist, has great passion too and I appreciate his support, both in hawker centres, and now in Town Council jobs. We are working with NEA and Mr Ang Mong Seng. "Let us reclaim this territory. We have drawn the battle map. This ground we take". So what do we need to do? I need to redesign jobs, promote mechanisation so that less skilled workers can take on these better paying jobs. We tried it in Jalan Besar as a pilot - conservancy cleaning. It worked well. What these projects would need is to restructure the contracts - to reward based on performance, higher mechanisation and help to train better workers. We will announce the specifics of this scheme later. We think there are significant job opportunities - a few thousand jobs that are available for Singaporeans if we can get the cleaning industry to upgrade. And this is in direct reference to Dr Jennifer Lee's question. How do we change? And she is right. If you reach a tipping point, if you are competitive based on cost and low skills, you are on a slippery slope. We will reclaim it by upgrading industry and training workers. 6.15 pm We will also assist conceptualised industry programmes in other workplaces. Ms Irene Ng asked specific programmes for older workers. I empathise with her. I see them as well. She said, "What would I say?" I also see many of them and, sometimes, I just listen because I understand their problems, although I must tell you that the situation has improved. In 2003, the redeployment rate within six months after retrenchment for all groups was about 62%. For those 50 and lower, it was about 56%, 6% less. It is not bad.”
“This programme is administered by NTUC and the five self-help groups who act as surrogate employers for such workers. We have provided $19 million of SDF funding to about 28,000 training places last year. This concept has worked well and I agree with him the funding can be enhanced. Mr Nithiah Nandan asked whether we can also support polytechnics, ITE training, and even university - a small proportion. I was quite receptive until he used the words "without restriction and limitation". I took extra notice. Well, the first answer is yes, we will. $19 million in 2004 for about 20,000 training places - that will be the restriction and limitation. Let me now turn to specific groups that Members have asked about. Dr Tan Boon Wan, Ms Irene Ng and Mdm Ho Geok Choo asked about lower skilled workers. They are quite right to highlight this group. The bulk of the resident workers of those without or below secondary education are between the ages of 35 and 54. In other words, they have another 10-15 years within the workforce. About four out of 10 of the resident long-term unemployed belong to this group. Members have asked what we can do to specifically help them. What we are doing is to look at the job market. Where are the skills that the jobs which require lower academic qualifications? We have identified these jobs in electronics, precision engineering and sewing operators. Because of our FTA, textile is coming back, as well as front-line jobs in hospitality sectors and cleaning. Let me focus on cleaning. Many Members are aware of it because they sit on Town Councils as councillors and advisors, and that many of the people cleaning our estates are foreign workers. This is another area we want to reclaim. I am trying to reclaim the shipyards.”
“The group employs about 100 employees. For the last three years, it received $18,000 SDF funding. They were smart. They did not complain. They just took. I urge other SMEs to follow this example. In fact, we have introduced a specific scheme for SMEs. It is called SME Upgrading for Performance (SUPER). Mdm Ho asked whether more grants can be extended to more training providers and that WDA does not duplicate some of the functions of primary providers. Let me assure her that WDA has its hands full. We promise that we will do the minimum and, in fact, we will not be a training provider. We are not. We do not provide training programmes. We basically use, as Mr Low has correctly pointed out, any provider that meets the criteria and fulfils the goals of our programmes. But I want to see the programmes translated either to employability or enhanced employability. Training is provided by our network of approved training centres and we will provide funding at $6-$10 per trainee hour. Employers can set up these in-house NSRS approved training centres and approved assessment centres. Mr Low asked whether the smaller companies can do it because it is hard for them. I understand their problems. We do not restrict ITE from working with them. If ITE feels that they can use them, I would encourage them to. But my sense, for practical reason, is that they should probably come together and approach ITE to have a specific programme. If we are satisfied that it translates to better jobs or longer in the job, we will fund the programme. Mr Heng Chee How asked about individual training. This was a point echoed by Mr Nithiah Nandan. Government does provide subsidies for individual training. He mentioned surrogate employer programme where we fund 90-100% of the course fees.”
“We are not sure what they said, but they were able to speak to each other and, therefore, they are more receptive to learning English. To fund all these initiatives I have decided to raise the contributions to the Skills Development Levy (SDL) as announced by DPM. And I thank the many Members for their support and agreed that we should do this. Why did I do this? Let me explain to you how the funding for training is obtained. There are two streams. The first stream is called the Life-Long Learning Fund (LLF). This is Government's commitment, and it put in $1.5 billion as an endowment. The other source is employers' commitment to train Singaporeans. We get it from employers because we believe that it is equally important for employers to be committed to train their workers. So the levy is pegged at 1% of remuneration of all workers with a gross monthly salary of $1,500 or less, currently. At the current levy rate of 1%, at the salary ceiling of $1,500, SDF would have been depleted long ago. Therefore, Government further injected $500 million into that fund. I have raised the ceiling from $1,500 to $1,800 with effect from 1st July 2004. If economic recovery is sustained, we will think of raising it to $2,000 subsequently. This was announced a few years ago, but was held back. Raising the ceiling from $1,500 to $1,800 will cost $22 million per annum. It is not a big sum and it only represents 0.03% of the annual compensation of employees. Mr Inderjit Singh made the point in the Budget Debate that this would tax SMEs. My rejoinder is that SMEs can also take from this fund. Because we pool this money, employers can apply for their trainees. And the smart ones have. Atlas Vending Pte Ltd is a company that operates and rents out vending machines and jukeboxes since 1980.”
“We need to teach the person contextualised skills for the work. By the end of the course, workers should be able to communicate effectively in their job in simple English. It is a good idea, but will it work? WDA piloted its first class on FLOW at Baxter Healthcare. Baxter Healthcare has 18 production workers who have been with the company since it was set up 26 years ago. These 18 workers now are aged between 50-60 years. So they were about 25-35 years old when they started work there. They have little or no formal education - very low literacy rates. They were working in the last manual production line of the company and needed to upgrade their skills to handle automated line, or risk being redeployed. Some of you may ask why Baxter took so long - never mind, they can answer that question. The upgrading training helps them to identify the name of parts, types of defects and so forth, but in English. WDA worked with Baxter to deliver the FLOW programme for these workers. They ran a module from 1st December last year to 12th March this year. The feedback has been quite positive. This is what the HR manager says, "The FLOW programme has definitely come at the right time, as without basic English literacy it is very difficult for employees to upgrade their skills, eg, technical and IT skills. We believe that this programme is a critical stepping stone for many of our older workers to keep up with the competition in the new economy." We asked the participants: how was it? They were equally positive. They said their confidence was boosted. For once they said, "We can upgrade", because they were able to speak to each other in simple sentences.”
“We have very good teachers who know how to teach the young ones but we do not have that many teachers who know how to teach adults. Of course, if we set ourselves the standards, then we will understand why we have the problem because sometimes our attention span, at least mine, is quite limited. We need to help trainers and training providers enhance their capabilities to ensure higher standards, and I would provide funding to train better adult teachers. The fourth aspect of the National Skills Framework is that we need to move from paper qualifications to directly usable skills, and for workers to acquire those skills in a shorter time. I do not think it makes sense to tell them, "You do not have the educational qualifications, you will have to take a 2-year part-time course. I will set up the time for you". Two years is a very long time. One such programme we are piloting is called Functional Literacy for Our Workers (FLOW) - I have a specific department in my Ministry that deals with creative acronyms. Before the development of FLOW by WDA, the lowest standard of literacy was Basic Education for Skills Training (BEST). BEST Module 1 was pegged at Primary 3 - very sensible - that was the lowest module. But, even there, you exclude a large group of workers whose literacy level was too low even to cope with BEST Module 1. What are you going to do? So under FLOW, we say, let us customise the contents so that it is directly relevant to the work place context. This is my understanding of it, not my staff. They can disclaim responsibility for me. I call it the "SIA girl" approach. You need to teach the SIA stewardess contextualised literacy, "How are you, Sir? Can I help you?" And, of course, as the joke goes, "Study lor, cannot meh".”
“It must be worth something. There must be currency, either currency from the employee's point of view or from the employer's point of view, preferably both. How do we do this? To do this, the skills that one acquires must have uniform currency to cross sectors. WDA will work with industry partners and post-secondary education institutions to set up a National Skills Framework. We need to ensure that there is consistency of skills sets so that Module A meets a certain standard across skills. We will start by asking employers: what do you need? We have 500,000 Singaporeans with less than secondary education. The approach is not to help them get "O" levels. I think that would be disastrous, and they do not need to have "O" levels. They need sector-specific skills. I have to ask employers what are their needs, and if I train someone with those skills, what is it worth to them? What is it worth to the employee? We do not need to re-invent the wheel. We can ride on the present National Skills Recognition System - broaden and deepen it into a National Skills Framework. Under this framework, individual workers will enjoy greater and easier access to training. Why? Because we are going to have modular and flexible programmes, and we want to take into account his prior working experience, what he has done over the last 15 years. It cannot be immaterial or irrelevant. From where his starting point is, how do we shift him to the next position? WDA is piloting this framework in a few sectors. We are starting with retail and healthcare. Both employers and unions have given us positive feedback. So, we will press on. But to do this, I need to raise trainers' standards.”
“First, we ramped up the Pre-Employment Training. We have increased our intake from 700 in 2000 to 1,000, ie, 30% in four years. That is quite significant, but still not enough. So what should we do? We can get people to make mid-career changes for those who need jobs to change to nursing, such as attracting former nurses back to nursing. Our efforts are working. In our recent healthcare fair, MOM received 6,000 applications for about 650 healthcare positions, many of them in non-nursing positions as well. Within a one-month application period this year, more than 500 Singaporeans applied for 100 places in nursing conversion programme - these are mid-career ones. The calibre of applicants is very high. I have met some of them - IT professionals, engineers and teachers. I spoke specifically to an architect. They are passion-driven. Nursing would be very interesting for the next few years. They are very perspective. They will go into a ward, and if he is an architect he will start telling you to redesign the hospitals because it is inefficient. But, despite such increases in local recruitment, we still face a considerable shortage. As healthcare services are required by our aging population and as we develop ourselves into a medical hub, we are chronically short of nurses. We cannot get enough. So these are sector-specific initiatives. I am pouring money there, and I am going to take a similar approach in aerospace, creative industry, electronics, hospitality, precision engineering and retail. These are growth sectors. But I also agree we have to make access simpler and easier for Singaporeans, not only to acquire new skills, but relevant skills. I want to move away from just training. In other words, to convince workers to train, the skills must be worth acquiring.”
“WDA is also exploring with MINDEF on the possibility of having these selected students serve their National Service with the Republic of Singapore Navy, so that they can pick up valuable hands-on experience in maintaining and repairing ships. Mr Heng Chiang Ngee, President of ASMI, is confident that NexGen will succeed in addressing the needs of the marine industry. In other words, if I have lost one generation, I will reclaim the next. Similarly, WDA and MPA will work together with key players in the maritime industry, because there are also important sectors there, and it suits our purpose to be an international maritime centre, whether it is in ship owning, rig building, repair, maritime finance and insurance, or maritime law. We have been asking people to come into these courses, even at polytechnics. Since 1987, we handled about 300 scholarships but yet we cannot. Let me explain to you that these are not unattractive scholarships. I asked for figures from my staff. We are so keen to have such workers, so much so that we are willing to fund them the moment they enter polytechnic. Together with MOT, we fund them, we fully pay for their courses in the maritime course and, on top of that, they get an allowance of $5,000 a year. They are bonded, but, in this climate, it is quite good to be bonded after they come out. Even then, I cannot get enough Singaporeans to fill up those scholarships. Only about 70% of local students are in these maritime-related programmes at the polytechnics. 6.00 pm Many Members mentioned nursing. The Acting Minister for Health, Mr Khaw Boon Wan, has said that they are short of nurses. They need about 1,400 nurses a year to cope with the demand. WDA and MOH will work with our partner agencies to close this mismatch.”
“What do they manage? They manage different foreign worker populations. They hire sub supervisors, ie, for the PRC workers, there is a PRC supervisor, for the Bangladesh workers there is a Bangladesh supervisor, etc, and they just manage. We have to reclaim these industries for Singaporeans. We need highly trained and experienced supervisors, and it is not poor paying. A supervisor earns $2,500 per month. But I cannot get enough people to do this. We tried career fairs and recruitment drives with limited results. We changed tactics over what we have done. Mr Arthur Fong and Dr Jennifer Lee asked what are the significant initiatives that we have taken. Let me try to give one. We are now working with the Association of Singapore Marine Industries (ASMI) on joint NexGen, an initiative with a longer timeline, but sensible. And we are working with MOE and MINDEF. Why? Because we have to change mindsets early, even while they are in school. The NexGen scheme will therefore target Normal (Technical) students to give them a better understanding of shipyard work, while they are still impressionable. We can bring them to the shipyards and show them what we have. We will select the NT students, let them go through a customised apprenticeship programme conducted by ITE and the various shipyards. We will also want to bring their parents, as we have to change the parents' mindsets, and familiarise them with the yards. Our generation grew up with the Spyros tragedy. For all I know, that is the mental image that is in the parents' mind. But the shipyards have changed tremendously. I need to change their mindsets.”
“Let me give a few examples to illustrate. First, targeted sectors. We must develop sector-specific initiatives. First of all, we need to go where the jobs are and make Singaporeans ready for them - all the jobs ready for Singaporeans. Mr Ahmad Khalis asked earlier on how we are going to meet the shortages in nursing and shipping. Dr Jennifer Lee also mentioned nursing. So, let me illustrate by using these industries. On shipping, a NUS study indicated that there are presently about 3,400 vacancies in the maritime industry. I have 90,000 unemployed, whereas there are 3,400 vacancies in the maritime industry. And yet, it is not popular. About 80% of these vacancies in the maritime industry are in the shipbuilding and repair sector. WDA is currently working with the marine industries. We recognised that simply telling people, "Look, there are jobs in the marine industry, please do", was not enough. So, last year, many of you followed me when I recounted my experience when I went with the Mayors. One particular Mayor was dressed in a yellow dress - there is only one female Mayor anyway - hoisted up for all to behold, but very few takers after that. It was a glorious sight, but somehow did not work, ie, it did not entice people into the shipbuilding industry. So we decided to look at this problem and perhaps be less ambitious on the lower sector and look at the supervisory sector and to let us be realistic. If we try to get Singaporeans into this sector, it must be well-paying, let us look at the supervisory sector. So, we looked at the current level of supervisors. The supervisors they now have in the shipbuilding industry have worked in the industry for many years - many nationalities, but very few Singaporeans. They tell me that these supervisors are actually managers.”
“For instance, employers in the electronics sector said that they needed people with basic literacy skills and those who are not colour blind, because the components have colours. If they are colour blind, when the production lines move, they will put things in the wrong place. I am not sure whether my officers are now doing the colour blind charts. I presume they are. I presume that they ask people whether they are colour blind. If they say they are, then they will find them other jobs. In addition, we put job seekers through mock-up exercises. This is a clean room at the job fairs. This is what they will be exposed to, video-taped, so that they are more prepared. The placement for electronics jobs has more than doubled as a result. While these are positive aspects - initial successes, as Mr Arthur Fong said - WDA must and will go further than just placing Singaporeans in jobs. I recognise that this is an important initiative, but it is nonetheless reactive and does not fundamentally address the challenges that we all understand and need and say that we need to address. To help address this structural mismatch, WDA's efforts must be predominantly proactive, pre-emptive, forward-looking, and outcome-focused. In other words, we must also change industries. To accomplish this, as recommended by the Economic Review Committee, we said that our Adult Continuing Education and Training (CET) system must be revamped. The old system is not quite adequate. This is a monumental task. We spend 4% of GDP on pre-employment training. How much do I spend on adult employment training? It is a limited budget. So, we are seized by this. We will not, as Mr Arthur Fong said, see this as a MCDS problem. This is a MOM problem, but this is work-in-progress.”
“It was never that simple, and we quickly recognised that there were specific skills that we required. Some Members have said that we should open up training. Yes, I agree that we should open up training. But I want to remind Members of the House that, as in all Ministries, there is a limited budget. So, we have also decided that we also need to be more targeted. We have put in place new Place-and-Train programmes - some Members have asked how effective that is - to re-skill job seekers in the domestic cleaning, precision engineering, wafer fabrication, textile and healthcare sectors. Let me tell Members why I decided we should do this. When I looked over the past few years of what our budget went in, where the workers were trained, there was no correlation between the numbers of people training in that sector against, what Dr Jennifer Lee said, an increase in productivity or more workers going into that sector. The cleaning sector is a typical example. We have thousands upon thousands being trained as cleaners. You and I know that our cleaning industry has not changed that much. So we decided that we better be targeted, which is Dr Jennifer Lee's point, raise the standard of the industry. It has to be holistic, get the right people in, see which is the growth sector and then move. We have also done Job Preparation Exercises (JPE) to help people get placed. In other words, instead of the usual job fairs, referrals and saying, "This is a list, go find it", we realised that was not enough. WDA decided to revise its approach and it started with the electronics sector. It started asking employees, "What do you need?" - a sensible question. And then, it developed Job Preparation Exercises to screen, select and match these candidates to these jobs.”
“In terms of job placements, since September 2003, together with our partners at CDCs and NTUC, we have placed about 12,000 Singaporeans, and these include Professionals, Managers, Executives and Technicians (PMETs) into jobs. But more important than just the numbers, the job placements achieved by our various job centres under the Distributed CareerLink Network have gone up by about 20%. In other words, more Singaporeans are taking up the jobs they were referred for. That reflects that there is a mindset change. And I also say more important, because it indicates that we have put in better capabilities in our job matching systems. What has been put in place specifically? First of all, since December 2003, we have put up a national job bank. In other words, the various job centres can share information about what jobs there are. Secondly, we have put in a national job seeker's bank. In other words, they can share information about the people that come to them for their profile and then the little notes that they put on the screen to indicate the peculiarities or the types of industries they want. That has helped. We have also trained more career counsellors. We have trained officers at various job centres. We have worked with NTUC to train some 200 union leaders and Industrial Relations Officers as job counsellors to help retrenched workers transit to a new job, as well as with the CDCs, and some 100 grassroots leaders of the Pasir Ris-Punggol GRC have been trained as job counsellors to help unemployed residents. We did that because, very early on, we realised that a job counsellor's job is not saying: "You are retrenched, you need a job, here is the job", the two should marry and bliss!”
“Dr Ng Eng Hen: Madam, I must say that it was a sense of satisfaction when Members asked the right type of questions that come about from them appreciating with me as I expressed the difficulties in the job landscape. That is a very important starting point. We have moved from making motherhood statements about how we need to provide livelihoods and jobs, to grappling with real problems on the ground because we have understood what the structure of workforce is, the type of work that is coming. So, when Mr Arthur Fong said, let us play up some initial successes, I will try. MPs have asked how Government can help, and many of them agree, and I take it is unanimous that WDA's role is pivotal. Some Members said that it has got its work cut out for it. Indeed, I want to remind the House what was said about WDA when we moved the Bill last year. Yes, it has been only six months since the WDA was set up. We said that: "We have spoken much during these past few months about the challenges of globalisation. We will meet these challenges head-on. We cannot rely on artificial barriers to protect our jobs. We must upgrade and give investors an incentive to locate and stay here because of a highly-trained workforce. The establishment of WDA signals Government's strong commitment to help Singaporeans stay employable and maintain our lead with a disciplined and technically competent workforce." Many would have remembered the words that WDA is pro-Singaporean. "Jobs for Singaporeans" is a mantra. Yes, we pledged that WDA will reach out to all workers, rank-and-file, as well as professionals and executives, employed or looking for jobs. I welcome this opportunity to give an update, even though it has only been six months.”
“Now workers can go for diploma courses if it comes under SRP, which is employer-driven and, normally, employers are not incentivised to send unless they see the necessity. Under the surrogate employer's scheme, workers can go for diploma programmes in a very limited way. Both the current arrangements for diploma programme are unsatisfactory. Here again, I have to state that many of our 'AO' level workers actually face the greatest difficulty because they do not have both skills and higher education. Will the Minister consider allowing workers to go for diploma programmes under the surrogate employer's scheme without any restrictions or limitations? To control wastage in training, some form of co-payment could be implemented. 5.45 pm Madam, next, I would like to touch on funding for part-time tertiary education. Many of our diploma holder workers would like to touch on the funding for part-time tertiary education. Many of our diploma holder workers would like to further their education so that they could seize job opportunities in a knowledge-based economy. I am aware that the cost of tertiary education is high and it will not be practical to tap into the funds of SDF wholly. At the same time, it is very costly for workers to go for tertiary education on their own. Those workers who are prepared to pay for their tertiary education may still need some assistance. Will the Minister consider reviewing the SDF scheme, whereby such workers could claim a small proportion, say, up to 10% of the course fee as a subsidy? Madam, in conclusion, to address the various needs of individual training needs in an ever-changing employment structure, would the Minister seriously consider the introduction of a learning account which has been brought up in the past?”
“Madam, the type of investments Singapore is able to attract require mostly high skilled workers. This is evident in the type of jobs available in the market. It is an established fact that there is a shortage of skilled workers. The Minister, earlier in his presentation, has indicated that there is a shortage of workers requiring post-secondary education and above. The shortage is about 360,000 jobs. This has resulted in our State having to depend highly on skilled foreign workers. At the same time, retrenched workers face great difficulties to fit into the jobs available due to the lack of skills required. Many speakers, who have spoken earlier on jobs for Singaporeans, have touched on this specific topic and I do not wish to further dwell on it. This state of affairs in the job market will become even more critical in the years ahead, as there would be greater mismatch of skills and jobs available. It is important to address this in a more comprehensive manner, so that more Singaporeans will be able to take up well-paying jobs. I have to emphasise here that to depend solely on employers alone for training is not helpful. Employers will provide training according to their companies' requirements. This would not result in our workers being multi-skilled. The trend of shorter tenure of employment makes it more important for the provision of training facilities that could enhance our workers' employability. Madam, many of the jobs available now require diplomas. Earlier on, Dr Tan Cheng Bock has mentioned that employers in fact, prefer, polytechnic graduates. That is very true, and we can realise it in the job market when we are trying to help our members.”
“Sir, I wish to clarify that I am not objecting to the basic principle that the subsidies in healthcare should be given to those who are really in need. I am aware of means testing for step-down care in the medical service. I have never complained about it. But, Sir, we must understand that we are now talking about C Class ward in the hospitals. We have to bear in mind that the cost of hospitalisation can be very high. No one really knows, whether you are relatively rich, or you are poor, and how much it will cost you. When people go for means testing, and some fall within the category of "not eligible for Class C ward subsidies", do they really know that they can afford? But affordability is dictated and determined by the Government that thinks they can afford. Is it fair to them? In my view, C Class ward, as it is now, is the last frontier of our social safety net system. If people are not sure whether they can afford, and they fall sick, they can go to C Class ward, and if they really cannot pay, Medifund will pay. I think people will not have so much anxiety. But the moment we change all this, when people fall within the category of non-eligibility, depending on where we set the benchmark, it will cause them a lot of anxieties and it is not being fair to them.”
“A good family physician can also be a good gatekeeper to the rest of the healthcare delivery system. 12.15 pm Dr Tan Cheng Bock lamented the erosion of this role. I share his observation but I do not think it is because of cluster formation. In fact, one of the objectives of cluster formation is to bridge primary healthcare with the secondary and tertiary healthcare. One example is that I am pushing lifelong Electronic Medical Record (EMR) for every Singaporean: one patient, one medical record, multiple clinics, multiple hospitals. Cluster formation will help us facilitate this transformation. The key is to bring together like-minded stakeholders and leverage on technology to achieve an integrated ecosystem of healthcare services from primary to tertiary, and back to step-down care. The concept is easy and simple. But to operationalise it is a huge challenge. I have some ideas and some plans for a pilot project to try this out. Later this afternoon, when I respond to the next group of cuts, I will use that opportunity to elaborate on this idea and I will definitely want to tap on Dr Tan Cheng Bock to help bring primary healthcare to the next level of excellence. As for Dr Tan Cheng Bock's comment on disease outbreaks like SARS, Ministry of Health, post-SARS, is no longer the same as before. We have learnt a lot fighting SARS, we have many battle scars to show for it. While we must not be complacent, we are now more fighting-fit. But Singaporeans must continue to help us out, by doing the simple things like wash your hands, do not touch your eyes, use serving spoon, stretch your body and exercise your heart. Mr Low Thia Khiang: Sir, may I seek clarifications from the Minister? The Minister referred to my previous comment in Parliament about polyclinics.”
“Such advertisements by patented drug manufacturers must surely lead to patients demanding such prescriptions from their doctors. It is, therefore, better that we move carefully, evaluate the impact, and then take further steps. Meanwhile, rules governing advertisements by hospitals will be loosened. Draft rules are in our MOH website for public consultation, and we will move as soon as we have studied the feedback. Finally, Sir, let me respond to Dr Tan Cheng Bock's passionate call for a greater role for primary healthcare. He felt that primary healthcare is the key to moderating healthcare cost and that, if we remain too hospital-biased, we are barking up the wrong tree. I share his passionate sentiments. That is why, shortly after I joined the Ministry of Health, I appointed a primary healthcare working group, which is still active, with representatives from both the public and private sectors. Their job is to identify gaps in our current systems and come up with innovative ways to manage disease holistically and also to transform primary healthcare services in Singapore. Our GPs and polyclinic doctors are the unsung heroes and heroines of our healthcare system. They will always get my personal support. I firmly believe that every Singaporean should have a good family physician, ie, someone who knows you, who knows your family well, who will respond to your night calls when warranted, and who will offer you sound advice on which specialist to see and which hospital to go, if you need secondary or tertiary care. A good family physician can help you save money, besides nagging you on your diet, waistline and exercises. If you have yet to have one good family physician, better hurry and look for one.”
“But I agree with him details are what count, and we will spend the next few months debating that. Dr Michael Lim spoke about exporting our medical expertise to the region, especially China and India, and I agree fully with him. He asked how I intend to change the mindset of my colleagues in the Ministry of Health to support such a development. I have already made one major mindset change to incorporate regional medical hub as an MOH priority. Please allow the Ministry of Health to digest that change first. In any case, as the Minister for Health, my priority is to serve the medical needs of Singaporeans first, followed by foreign patients who come here for treatment. And then if I have some time to spare, I will think about how to serve the medical needs of foreigners in their home countries. Meanwhile, I leave it to experts like Dr Michael Lim, to tap that market, championed by MTI and IE Singapore. I will cheer them on the sidelines. Dr Michael Lim also urged a greater relaxation of advertising rules to allow our doctors and hospitals to market themselves better in the region. He described our current regulatory regime as conservative and outdated - although he did not use those words. My instinct, honed in MTI for seven years, is always for light regulation, because every regulation has a cost, and should be put in only after careful thought. But in healthcare, which affects life and death and which has major cost implications, it is better to be slightly conservative. In US magazines, prescription drugs like Viagra and Zoccor are now widely advertised to lay public. I am not exactly sure if this is a good thing. Earlier, we heard comments on how we should educate patients to accept generic drugs so as to save on cost.”
“But the rich are also the ones who pay the most in taxes. Are we double taxing? But we are trying to achieve an outcome whereby, because we have to balance our accounts, subsidy is a zero-sum game. So, if I have more subsidy money because I collect more fees, then I can help the poor, I can stretch the subsidy dollar more. If we do not do this, and all rush to go to Class C when they could afford a lower subsidy, then I will first have to raise fees more frequently for all classes, including Class C, or raise taxes more, in which case, we will be going back to this top whatever percent who are the major taxpayers. So, let us not kid ourselves. We are not magicians here, and my job is to present the facts out into the marketplace so that people can see for themselves. If we are squeezing everybody, making profits, paying doctors and CEOs unrealistic pay and so on, then obviously we are in the wrong. But my job is to try to provide a good level of healthcare in a sustainable manner, and we all know a good level of healthcare does not come cheap. Mr Low Thia Khiang objected, I think, to means testing. I was flipping through some Hansard records a few months back, when I was asked to take on this job. I am relying on memory here. I am past 50, memory not perfect. I think I recall him making some comments, objecting to the rich becoming subsidised patients through the polyclinics, because our system is, if you are referred by the polyclinics, you are straightaway a subsidised patient. I remember, I think, he made such a comment that those who are rich should not be subsidised. But without means testing, how do I then know whether you are rich or poor? On that score, I thought he would then be supporting means testing.”
“I share their concerns, which we will take into account when devising the means test criteria. We will calibrate subsidy levels appropriately, to ensure that hospital bills remain affordable to all Singaporeans. That must always remain the priority. Fourth, we will be gentle in implementation. With simple rules, there will inevitably be deserving cases which fall through the cracks. Mr Andy Gan made the point that the patient's circumstances prevailing at the time of admission should be taken into account. We must be able to come in promptly when alerted, to sieve out such deserving cases and free them from unnecessary distress. Let me assure Mayor Zainul Abidin that our means test will not be mean. As Mdm Halimah pointed out yesterday, means testing should not be a demeaning process, but should be handled sensitively. Fifth, it must be transparent. And you know my view about transparency. Mr Gan Kim Yong and Dr Michael Lim called for transparency in implementation. I fully agree. The scheme must make sense to everyone, such that Singaporeans, if they like, are able to compute their own subsidy status. As this is a complicated subject, let us continue to discuss and suggest more ideas over the next few months. I have created a special section in the Ministry of Health's website to gather all feedback and suggestions. And I intend to continue to work with the Feedback healthcare group to advance this project. Mr Steve Chia objected to means testing. He asked several details, such as, will we be using IRAS data, therefore, breaching confidentiality. What is the cut-off? What do we mean by "well off"? Obviously, those are details that we will have to discuss through over the next few months. He made a point that if we means test out the rich, they will have to pay more.”
“We will, therefore, need to simplify, but, to simplify, inevitably we will have to use proxies to determine whether it is wealth or income. The scheme should cause minimal inconvenience to patients and not delay their treatment. It should not be costly to administer. Second, it must provide choices. Mr Andy Gan reminded us that if means test results in taking away freedom of choice from patients, that would not be good, and I agree. So, Class C wards should remain open to all Singaporeans, rich or poor. Patients should continue to have the freedom to choose. In fact, there is nothing wrong about the rich going into Class C. Let us not be judgmental about their decisions. Mr Low Thia Khiang asked just now whether there are data. There are. A few weeks ago, I remember, MOH published an occasional paper and there were quite a lot of data in that paper to show the income profile of patients in the various classes. It is a small minority. I think somebody asked the question: who are well off? So it depends on how you define the "well off". It is, from my point of view, still a small minority. But it is not insignificant. And what we are trying to do is to, hopefully, nip the problem in the bud, to avoid a larger problem in the future. Dr Lily Neo and Dr Chong Weng Chiew reminded us to ensure an adequate supply of Class B2 and C beds, which I agree. Third, it must be fair. The aim of means testing is not to reduce Government subsidies because of the current deficit, as suggested by Mr Gan Kim Yong or some other MPs. The aim is to better target our subsidies to those who need them most. Dr Lily Neo and several MPs, eg, Dr Ong Seh Hong and Mr Nithiah Nandan, have spoken about the potential squeeze on the middle income group.”
“On the other hand, Dr Chong Weng Chiew has expressed support and, in fact, urged me to do it as soon as possible. Dr Michael Lim pointed out that the number of well-off Singaporeans opting for B2 and C class wards should be small, and asked if it makes sense to put in place a system to catch such a small minority. Mdm Halimah also questioned if the social cost of means testing justifies the benefit. Mr Yeo Guat Kwang asked for some details, but all of you advised me to be cautious. So, this is clearly a complicated subject and, like non-catastrophic medical insurance, I would take my time to think through the issue, consult widely and hear all views, so that we can come out with a practical scheme. Dr Lily Neo and Mr Chay Wai Chuen stressed that medical insurance should be in place before implementing means testing, so as to avoid distressing the affected group. I think that is valid. Mdm Ho Geok Choo and Mr Gan Kim Yong said that the criteria for determining affordability should be multi-dimensional, ie, a range of factors, and not solely dependent on just income level. Family size should be taken into account. At the same time, however, Dr Lily Neo, Dr Ong Seh Hong and Dr Chong Weng Chiew pointed out that the current formula used in nursing homes seems to penalise small families. Dr Chong has two years of ground experience with means testing. That probably explains his confidence and why he recommended that I move faster. But he too noted that the current scheme was not perfect and should be refined. From the various comments, I have distilled several key principles behind what, I think, could be a practical means test scheme. First, it must be simple to implement. I agree with Dr Ong Seh Hong and many others that we should not end up with a bureaucratic monster.”
“And when I shared these views with them, one senior insurer stressed the need to discourage over-charging and over-servicing by doctors and over-consumption by patients. As pointed out by Dr Lily Neo, there must be a national fee schedule to control prices. He was speaking from experience in motor car insurance, and I value such insights. I welcome more debate and more discussion on this important subject. Let us settle the larger picture of this national basic medical insurance plan before we address other details, like Mr Yeo Guat Kwang's query on how existing employer-based medical insurance could accommodate the proposed national health insurance plan, without duplication, or Dr Lily Neo's proposed insurance to cover complicated pregnancies, or Mr Chay Wai Chuen's proposed insurance for home nursing. 12.00 noon But one thing is clear. We should not leave out the self-employed. If they stay out of the 3M framework, they are storing up problems for themselves and their loved ones. CPF Board will be enforcing Medisave contributions by the self-employed, and I hope Singaporeans can accept this need for strict enforcement. Small regular payments via monthly GIRO have helped many taxpayers pay their taxes. Likewise, the self-employed should use GIRO for their Medisave contributions. The third strategy is for the Government to stretch our subsidy dollar. As Health Minister, Acting or otherwise, I will do my best to secure the largest possible budget allocation from the Ministry of Finance. But, realistically, Government money is not unlimited. So, my Ministry will have to stretch the subsidy dollar. How? Means testing. Many Members have commented on this. Dr Michael Lim gave us 10 reasons why it should not be implemented.”
“It ensures full coverage with the lowest possible premium. It ensures maximum equity and efficiency, so that insurers cannot cherry pick and leave out all those with preconditions or born congenitally sickly. But if there is no consensus for a national compulsory scheme, then we will have to find compromises, which hopefully do not stray too far away from this ideal. Fourth, it must be financially viable. Premiums collected must more than cover claims, not just for one or two years, but for the long term. Insurers have to build up reserves and this is especially so for a young society like ours. We have an experienced insurance industry in Singapore and we should see how we can leverage on the industry to formulate and operate the schemes. Fifth, it must offer choices. Different people have different needs. Some are satisfied with Class C; others prefer private hospitals. While we should have a national basic medical plan to which all Singaporeans subscribe, we should allow enhancement schemes as riders - I think that was pointed out by Mr Yeo Guat Kwang - to the basic medical plan, for Singaporeans with higher needs. Sixth, it should cover only hospitalisation and the equivalent, such as day surgery. I think we better learn from the experiences of Taiwan, Korea, and avoid an extended framework covering all sorts of minor ailments, coughs and colds which can be easily abused. This would also be consistent with our basic approach to Medisave, since the intention is to allow the use of Medisave to cover the premium and Medisave is primarily only for hospitalisation. I have begun the discussion with the industry. Last week, I met a few players from the insurance industry over lunch.”
“Outpatient expenditures alone account for two-thirds, two in three, of the total claim amounts. The programme therefore went into deficit. In 1998, payouts exceeded premiums collected by NT$2 billion. This deficit increased to NT$16 billion in 2002. South Korea implemented a similar programme, a few years earlier than Taiwan, and is also facing perennial funding deficits. So before we rush into this non-catastrophic medical insurance nation-wide, I think we better debate all these downsides thoroughly, make sure we have good mechanisms in place to reduce such risks. And that is why I need a few more months to carefully study the problem and discuss it with Singaporeans extensively. We should take a leaf from motor car repair insurance, which many of us have personal experience with. For today, let me just lay down the key principles underlying what, I think, a well-designed non-catastrophic illness insurance plan could look like. First, it must have a deductible component. For motor car repairs, insurance does not cover from the first dollar and we have to fork out the first $1,000 before insurance kicks in. Similarly, we should not allow the first dollar coverage for healthcare insurance. In this way, hopefully, we can cut out frivolous claims. Second, it must have a co-payment element. Patients must co-pay part of the bill. In this way, we cut out abuses like prolonged hospital stays or demand costly implants when cheaper alternatives are available. Third, the premiums must be affordable. As pointed out by several MPs, large insurance pools are generally cheaper to fund than small insurance pools because of economies of scale. To minimise administrative cost, a compulsory national scheme is the best, as pointed out by Dr Lily Neo.”
“If implemented, we can tweak it to make employee medical benefits portable, an issue advocated by Mr Yeo Guat Kwang, also for several years. And I hope to be able to turn this old idea into reality. This will benefit all Singaporeans, upper, middle, lower income groups. Non-catastrophic medical insurance is not new, of course. It is common in the US, Europe, Australia, Japan and many others. But the experience, as pointed out by Dr Gan See Khem yesterday, has often been catastrophic. Last year, the former California Governor, Gray Davis, lost his job partly because of medical insurance. In the US, for years, the premiums for medical insurance have been rising, double digit percentage, at 12%, 13%, 14%, per annum. Employers are crying out as it adds to their cost and it affects their competitiveness. So they are passing on some of the increases to the employees. Naturally, the employees are crying out too, and they voted in the "Terminator". The reason why premiums are increasing is that costs and volumes have run wild, and run wild every year. Because of the way they structure their health insurance system, there is very little incentive for patients or doctors to save. As a result, over-consumption by patients and over-servicing by doctors are very common. I am not making this up. In 1995, not too long ago, Taiwan introduced a National Health Insurance, providing comprehensive coverage, including for outpatient care. So Mr Nithiah should listen to this carefully. But the scheme has now run into problems - wastage, over-consumption. Just some data. Outpatient visits per person per year in Taiwan is 15. So every month, at least one trip. This is three times the level in Singapore.”
“And one effective way is through insurance. Every year, only one in 10 Singaporeans needs to be hospitalised. The trouble is that we do not know whether we are in that 10%. If we were to individually self-insure, in other words, make provisions for this risk of hospitalisation, the cost to each one of us and, also, to Singapore as a whole, would be quite large. But if we all chip in to pay for insurance to collectively cover the risk of this 10% of our population who need hospitalisation, then our individual burden can be reduced considerably. This is, of course, the concept of risk pooling. Currently, we do allow some pooling of risk via MediShield. So every year, among the 10% who are hospitalised, a small proportion of the patients develop catastrophic illnesses - cancer, organ failure - which require long hospital care and expensive treatment. And hospital bills for such illnesses, even at B2/C rate can be catastrophic. So 14 years ago, we introduced MediShield to allow Singaporeans to share the risk of catastrophic illnesses. And it has worked generally well. However, many Singaporeans do not quite understand the concept of catastrophic illness insurance, as pointed out by Mr Nithiah and Mdm Halimah. Some Singaporeans think that MediShield would cover all hospitalisation, including the non-catastrophic illnesses. So when they find that their MediShield coverage does not cover their short hospital stay, they get pretty unhappy. My Ministry is studying how we can extend risk pooling beyond MediShield to cover non-catastrophic illnesses with use of Medisave allowed for such premiums. This is an old idea which several MPs, particularly Dr Lily Neo, have been advocating in this House.”
“But I am sure there are valuable lessons that hospitals can learn from the efficient car manufacturers. Second, we help Singaporeans stretch their Medisave dollars. One of the best things to have happened to Singapore healthcare is Medisave. Every day we work, we save a few dollars of our income for our future hospital bills. After 20 years of Medisave, we have collectively saved a total of $30,000 million in our Medisave accounts, ie, $30 billion. And it is growing. Every year, about $2.5 billion of Medisave contributions are collected while $800 million, ie, $0.8 billion, are withdrawn to help pay hospital bills and ElderShield/MediShield premiums. Collections exceed withdrawals because we are still a young society, so we are saving for our future aged needs. Although $30 billion sounds like a big amount, the individual balances of most accounts are not that big. For example, 17%, one in five, of all Medisave accounts have less than $1,000. One trip or two to a Class B2 or C ward and everything could be wiped out. It is for this reason that MOH is very reluctant to allow Medisave to be used for home care, as suggested by Dr Chong Weng Chiew. These home care services are generally still affordable after Government subsidies, and Singaporeans should really preserve their Medisave for more expensive hospitalisation. Even the larger Medisave accounts are not that big. And this is because we cap the Medisave balance per account at a maximum of $30,000, which is based on B2/C rates of needs. But a significant portion of Singaporeans in the upper and middle class prefer private or Class A/B1 type of medical services. And they will find their Medisave balances insufficient for their needs. I would like to help Singaporeans stretch their Medisave dollars.”
“So I was pleasantly surprised to read in last month's issue (February 14th) of Hospitals & Health Networks (which is an American healthcare magazine), an article about how some American hospitals are adopting the Toyota Production System in their hospitals. They are going all out to eliminate waste, the Toyota way. Why is waste seen as the root of all evils? For hospitals, wasteful steps add to cost, increase the time to respond to patients, multiply the opportunities for mistakes. And for patients, waste means long waiting, having to move from pillar to post, unnecessary suffering and additional cost. 11.45 am The article went on to describe what some of these "Toyota-hospitals" are doing to improve the situation to achieve what they describe as the "lean turnaround". And one key strategy is standardisation. As one Chief of Cardiac Surgery put it, "We are crazy about standardisation. We standardise everything and then we standardise our standardisation." And the article ended with this vision which is worth quoting: "Imagine our healthcare organisations with errors near zero, where everyone has quick access to diagnosis and treatment, where year by year costs are stable or even decreasing, and where revenues are rising. Sounds like a fantasy? The early pioneers in lean manufacturing envisioned a similar "fantasy". Those who were bold enough to embrace the lean revolution early (like Toyota) have their competitors behind." So I urge our hospitals to get similarly inspired. It is probably difficult for healthcare to match the automobile industry, for the simple reason that patients, unlike automobiles, are not identical. I think we have a short discussion on that also at the last sitting.”
“I know some media commentaries have pointed out that this may be because healthcare here is so expensive that Singaporeans cannot afford to seek treatment, so they stay away from hospitals, like SARS. The logical extension of that argument is that Singaporeans, so deprived of proper healthcare, must therefore be generally sickly and dying prematurely. But if this was so, our life expectancy would not be one of the highest in the world today, having improved from 76 years in 1994 (10 years ago) to 79 years now. Women live longer, past 80 years. We should certainly not get complacent, but I think we can take heart that we have achieved a high standard of health, with lower resources, as compared to others. But, of course, there is scope for improvement. I have some ideas on how this can be done and I will use the next few months to discuss them thoroughly with Singaporeans. Today, let me just highlight the key strategies and in that process, I will try to address all the points raised by Members. Hospitals: Stretch the budget dollar First, our hospitals have to stretch their budget dollar. They have to learn to do more with less. Among other things, they have to make better use of IT and technology to help cut costs, as suggested by Mayor Zainul Abidin yesterday. They should use generic instead of patented drugs, where possible, without compromising safety. Last year, when I launched Singapore-Medicine, I spoke about how we should strive to be the Toyota in healthcare: to produce the Corollas in healthcare, at low cost, with high reliability and zero defects, if possible.”
“Some doctors there had received death threats from relatives of patients who died. One doctor was slashed by a woman with a chopper! Some doctors have had to engage bodyguards. As one doctor put it, and I quote him, "they think we are gods, that we can cure anything". So when such expectations were not met, the relatives got mad with the doctors. While this is an extreme example, the global trend is one of rising expectations for the best possible medical care to provide a good outcome, regardless of the nature of the illness. Now, this is especially troublesome when it is not matched by an equal willingness to co-pay for the care. As a result, Health Ministers all over the world are expected to do the impossible: provide the highest standard of medical care but at the lowest fee, even better, free. Many politicians do make such a promise, and some voters believe them, only to be disappointed when the promises are not fulfilled. But, meanwhile, public healthcare services deteriorate. In Singapore, we make no such promise. Right from the beginning, we persuaded Singaporeans to accept co-payment and shared responsibility in healthcare. This philosophy is institutionalised in our 3M framework of Medisave, MediShield and Medifund. Our 3M framework is far from perfect, but it is probably the best healthcare financing model you can find in the world today. Last week, my Ministry published a paper comparing the utilisation of medical services in Singapore with several developed countries. And we did well. We have lower hospital admissions per capita. Our patients generally do not overstay.”
“Such medical insurance should not only cover inpatient but also some major outpatient treatment. I would like to know whether the Government has plans to review the MediShield insurance scheme or introduce other insurance schemes in the immediate future to address the problem faced by many Singaporeans. If the Government has decided to introduce medical insurance, it must have sufficient mechanism to check the abuse of insurance companies and medical professionals for their own self-interest. The Government should act as a strong gatekeeper. Sir, at the same time, I would also like to urge the Government to consider giving a one-time reprieve to those who have opted out of the medical insurance scheme to rejoin the scheme. As mentioned by the hon. Member Mr Yeo Guat Kwang, about 270,000 have opted out, and there are many non-working Singaporeans who are also not covered by MediShield. We should treat this as a national agenda and give a one-time reprieve. The Acting Minister for Health (Mr Khaw Boon Wan): Sir, Dr Lily Neo, Mr Gan Kim Yong and many others spoke on healthcare cost. In fact, we had just recently, in this House, a short discussion on the same topic. People, all over the world, worry about rising healthcare cost. They want to be sure that, first, good healthcare services are available should they fall sick, and, second, they will have quick access to these services, whether they are rich or poor. This is totally understandable. With advances in healthcare, patients have become accustomed to thinking that death can be avoided, if only good medical services are rendered in time. Just last week, I read some media reports about "doctor bashing" in one Chinese province, I think, near Chengdu.”
“Sir, the labour movement has raised the issue of portable medical benefits in the past couple of years. To-date, there has been very little progress in this area. Yes, in 1994, the Government did introduce portable medical benefits for civil servants under the MSO scheme. Like the hon. Member Mr Yeo Guat Kwang mentioned, under the MSO scheme, whatever was contributed in the last 10 years could have been wiped off by one serious episode of medical problem. All this while, the only national medical insurance in place is the MediShield insurance scheme, which is neither comprehensive nor sufficient to replace the current medical benefit provided by employers to workers or cater to the increasing cost and address the needs of an ageing society. Sir, in the last couple of years, a number of retrenchments or early retirement are taking place in many industries in Singapore. In fact, restructuring, reorganisation and merging have resulted in workers losing their jobs early. Many of the retrenched workers are older workers and amongst them, a number of them may have medical problems. Such workers are left stranded without the medical benefits provided by their employers. Yes, they could use their Medisave to pay for the inpatient treatment, if they have sufficient funds, but not for costly expensive outpatient treatment. Due to the economic downturn, workers who have lost their jobs are not covered by a medical benefit scheme. Even for those who are covered by MediShield, the coverage is not comprehensive or adequate to meet their needs. Hence, it is important that workers be covered by medical insurance not only when they are in employment but, more importantly, in between jobs and after their retirement.”
“This need for cash deposit should be reviewed, and the use of Medisave should be considered for expensive outpatient treatment. Another factor to be reviewed is the difficulty one faces if he chooses to downgrade to a subsidised ward later if he faces hardship. The plight of the middle-income workers with insufficient Medisave accounts to cater to their medical needs and their dependants should also be taken into account. Sir, I wish to urge the Minister to consider these factors mentioned earlier when details of means testing are worked out. And, at the same time, the basic medical scheme should be reviewed.”
“Sir, the last three years' statistics have shown an increase in the number of patients using subsidised wards in Government or restructured hospitals. These developments may have prompted the Government to consider the introduction of means testing. However, it must be noted that these developments have a correlation with the prevailing economic condition. I do agree that subsidised medical treatment should go mainly to the low income, the poor and the needy. I wish to strongly suggest that the current subsidy level and cost should remain as it is so as not to deprive the group of citizens of their medical needs. Sir, many Singaporeans have been worried by this term "well off". It has not been clearly defined. Different people may mean different things when you say "well off". So I think the Government has to clearly explain on this point. Sir, we should also not ignore the plight of the middle income workers in managing healthcare cost for themselves and their dependants. A number of such workers have been affected by the economic downturn. At the same time, we should study the reasons deterring such workers from using non-subsidised wards, besides the high cost of such wards. Take, for instance, the B1 Class wards. Even if one were to use Medisave, he still needs to top it up with cash deposit. For example, if one is going for a Table 1 surgery in SGH, the cash deposit needed is about $1,000. And for Table 7 the cash deposit needed is $3,800. This clearly shows how much of Medisave one can actually claim. The rest has to be forked out. 11.15 am This is not the end, Sir. Once he is discharged and he goes for follow-up treatment at the specialist outpatient clinic, the cash needed could be considerable. It will be much more if one is suffering from a chronic illness.”