Chay Wai Chuen
Singapore
“As a result, some enterprising businesses and grassroots people have even come up with better ideas on equipment and machines designed to suit our HDB estates, HDB rubbish chutes and our older workers, to make the equipment easier for them to handle. 3.00 pm I give this as an example.”
“Since there are so many anomalies administered by the two agencies up to now, and because so many retailers will be affected, I urge the Ministry to freeze this scheme and review the procedures and policies entirely and put up the designated land for tender to be administered by one agency.”
“Sir, I would like to ask the Minister to give more choices, in terms of compensation or alternatives and flat type allocation for those people who are affected by the Selective En-bloc Redevelopment Scheme. Children should be, as best as possible, allowed to help pay for their parents in some of these choices that they have to choose.”
“Sir, the MUP Programme has been in place for some time and it applies to units which are 17 years and above. I would like to ask the Minister why are 40-year old flats still not upgraded.”
“Mr Chairman, there is an increase in the operating expenditure of $648 million this year for the Ministry of Defence. I would like to know what is the rationale for this increase.”
“Sir, the SAF has been involved in peacekeeping missions on several occasions, in East Timor and the Middle East, typically in the area of logistics and medical services. I wonder whether the Minister can enlighten me on what kind of role the SAF can play in this area of peacekeeping missions.”
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“As a result, some enterprising businesses and grassroots people have even come up with better ideas on equipment and machines designed to suit our HDB estates, HDB rubbish chutes and our older workers, to make the equipment easier for them to handle. 3.00 pm I give this as an example. The cleaning work in Town Council estates is not a big services sector. But unless we all do the redesigning - in work, equipment, contracts and, along with it, the incentives - the services sector will not improve, and all the input expenditure cost in WDA that Prof. Ivan Png alluded to some days ago will not lead to better output or outcomes and, along with them, more employment for Singaporeans. Professionals, Managers, Executives and Technicians (PMETs)”
“Secondly, equipment have to be suitable for the job of cleaning that we undertake in the Town Council. There are many definitions and standards and requirements regarding standards of cleaning. What we have to do is that we must be sure that there must be an outcome of performance that is satisfactory to the Town Council and residents. So it is only with this suitable equipment that we can match together with the workers that we have to undertake this kind of realignment. Thirdly, sourcing of contracts has to change. The cheapest guy with a broomstick may not be the preferred solution. Fourthly, contracts have to be redesigned so that the legacy contract documents which, for example, were handed down from HDB days with the old set of parameters and yardsticks of measurements also have to be changed to a better set of performance indicators. So in our new pilot, cleaning equipment were leased from the respective suppliers, so that the serviceability of the machines and equipment is assured and the replacement units are delivered should there be a contract failure or an equipment failure. Contract terms also have to be fixed for a longer term, instead of yearly, to stabilise the risk. As a result of these, which were successfully implemented, the 70% local ratio was achieved in the Town Council without much increase in cost. The local workers were better paid because productivity is higher. Today, the Tanjong Pagar Town Council has a full roll out of mechanisation in the town where 70% local workers are doing the cleaning services.”
“Sir, I would like to raise this issue of redesigning work. We have an ageing workforce and one of the issues in redesigning work is to make sure that our workers are continually trained and retrained, and WDA is doing programmes to retrain the workers with proper allowances, and so on. But I believe equipment and machines also have to be redesigned to suit the older workers. So the question we should ask is whether there are incentives given for employers using new equipment, to employ retrained workers and possibly older workers. All these new workers and new equipment in redesigning work must, at the end of the day, make a profit. Otherwise, there is no incentive to use the proper equipment. I want to give an example that was piloted in the Tanjong Pagar Town Council three years ago when I was the Chairman - the current Chairman, Dr Chong is sitting here - when we decided to switch from a 30% local workers environment in cleaning work to 70%, which is currently in the Town Council there today. There was no big need for us at that time to really do this change, apart from the periodic disturbance that we had from MOM to check on foreign workers. So we sat down with the management staff and we just wanted to show Singaporean workers, even older ones, how to respond to incentives and training, so that this 70% local portion ratio can be achieved by the right alignment of process, incentives and productivity. Workers alone, redesigning work, with all the training, will not solve and address this problem. They need suitable equipment to do the job. And the corresponding output productivity must make economic sense. Firstly, jobs have to be redesigned by retraining workers in learning the use of equipment.”
“And if this is recognised as important, then the time and the resources can always be found for it.”
“For example, most European executives can speak more than two languages, unlike the British or the Americans. The reason is because they come from small countries where they have to interact across borders for business and communication all round Europe and all over the world. And they were the leaders and still are the leaders in international trade and contacts. Students here are not allowed to learn a second language which is not their Mother Tongue, and not a third language unless they are permitted by the Ministry to learn French, German or Japanese, because these languages are considered to be good foreign or international languages. The question I want to ask is: why is Spanish, for example, not one of those foreign languages that we allow our students to learn? I think it is a more international language than French, German or Japanese, being the language of South America, south and south west US, besides Spain. Many older Members of the House, including myself, have learnt Mandarin and Malay at school or as a civil servant besides English. How many of our younger Singaporeans know Malay besides Mandarin? Indonesia and Malaysia are at our doorsteps. They are countries with a lot of economic potential and opportunities. When the SAF detachment arrived in Aceh for assistance during the tsunami crisis, only a handful of Singaporean officers could communicate with the ordinary Indonesians. While English may be spoken in the big cities, speaking the local language will help a long way towards bridging and understanding, and building goodwill. Hence, I urge the Minister to allow more flexibility for students to learn the second and third languages, especially if we are to be a global city.”
“Sir, the question I would like to raise is: should Singaporean students be allowed to learn second or third languages beyond the limit which is currently placed on children for the learning of the Mother Tongue in schools? Sir, language, as a means of communication for international contact and as a touch-point medium for meeting and interacting with people across countries, is very important. Speaking another language facilitates interaction with our neighbours, and perhaps may lead to more opportunities including business later on. I am not talking about cultivating people with bi-cultural values. How many of us can claim to be bi-cultural? We all, in Singapore, can probably be just cosmopolitan or plain international. I am only thinking of preparing ordinary mortals who, at some stage in their life, would be running around making a living. The emphasis on listening and speaking in the way of learning Mandarin that is currently being done, I think, is correct. It would be the same for learning any other language. By adopting this approach of listening and speaking, we can get many students to be interested to learn second or even third languages. By adopting this approach to learn languages, we will shift emphasis of learning by rote for examination to learning by speaking, by listening and by learning to read the language. Must the level of examination be pitched so high that so many students are put off by the learning of it? Language learning then comes to life when it opens up doors to opportunities and learning about people in other countries. And those who have stronger interest and capabilities can pursue further and develop their talents into literature and philosophy later on in their own way. Sir, I believe learning a foreign language is extremely useful.”
“Even so, their rental housing is also subsidised and paid out of public funds. With a reverse mortgage, the home owner can continue to stay in the flat. He is accumulating debt to set off his equity - not a sin in financial management. 3.30 pm Issues like age of the flat, mortality, age group, interest rate volatility and insurance rates can be factored. We can begin with 3-room HDB flats that have been fully paid. These are flats which the owners bought for $6,800 in the mid-60s and, today, can be sold at about $150,000 in areas like Queenstown, for example. At 20-25 year term, in terms of annuity, the monthly pay out could be computed, depending on the factors used, say, between $500-$1,000 per month. At an average of $700 per month, it is comfortable to sustain the elderly without medical cost, which is covered separately by medical insurance. The post-war baby boomers are coming home to roost. The first one among them turns 60 this year. The wealth of the average Singaporean was built up in one generation - the legacy of the Minister Mentor, from third world to first world in one generation. It is a unique legacy. It is now time that we should imaginatively build on this to give hope and to make life more meaningful for the elderly Singaporeans. The average Singaporean's wealth is his HDB flat, after he has paid for all his children's education and other obligations. So, let us not tarry, and let us do something to build the safety net for him by showing him the meaning of home equity. HDB Downgrading”
“Sir, I would like to talk on this topic of reverse mortgage first raised by the Howe Yoon Chong Report in 1984 and also recently in the Report on the Aged that recommended the development of the reverse mortgage scheme as a means of monetising the home asset for the aged. Sir, I first raised this topic in Parliament in my first speech in 1988 and, ever since then, several other Members of this House have also raised this topic. It is a topic that does not die and, with each year, the problem of the aged facing the retirement days becomes more urgent. Reverse mortgage was piloted in the United States for 10 years since 1988. It was established as a programme under the Housing and Urban Development (HUD) in 1988. There is demand for this product by a category of people, those retirees who are 60. There is a need for this private sector participation but there is also a need for the Government agency to undertake what I would call an underwriting role. The Government cannot run away from this role, if such a scheme is to be a success. Such a scheme, if it is to succeed, is as much a task for the MND or HDB, as it is for the Insurance Commissioner. Performing a market risk balancer role is a legitimate role of Government, particularly so, as it can provide a safety net for the many senior citizens currently 65 and over, who have nothing much more besides the flat as their asset. I am not asking for this risk underwriting role to be done for every house or every home category. It is not necessary. Private sector homeowners can sell away their properties and downgrade and cash out. But 3-room HDB flat owners have to wait 30 months, before they can rent. And renting a 1-room flat is a very drastic way to downgrade with other restrictive conditions.”
“Job redesign is not sufficient, and will not solve the problem. Machines and equipment have to be worker friendly or redesigned. Contracts of engagement also have to be redesigned. I have a question in the Committee of Supply and will elaborate more on this later. In the package to share the surplus of the Government with the people, all Singaporeans get to share. Those in need receive more and they are also measures targeted in an effective way of helping them in their finances. It is most important that measures assist them effectively - by helping and training and retraining, by helping in matching jobs, by helping them own homes, so that otherwise rental expenditures by the family can be converted into savings and home equity. Everyone is getting something from this package. I have one clarification to make about the Growth Dividends. The amount a person will receive depends on two factors - his income and his wealth. What about those with no income and no wealth, as defined in the boxes? These are people who stay in the HDB rental flats who are retired, aged or unemployed. I hope all the smart computer programmers will capture this set of people. I can see that the Government has devised effective ways to target assistance to those with various needs. I believe this is a good use of information technology and databases with which we should build up progressively so that various policy formulation can even be anticipated over the life cycle of the general population. My hope is that the Government should assist people in the right way. It is the age-old story of teaching a man to fish and giving him a fish. Giving money is okay for a day - enabling the worker to work for a living wage is a challenge. Sir, I support the Ministry's Budget for FY 2006. 4.17 pm”
“But it is proper to free up as much labour as possible for the private sector, so that the economy can grow and support private sector economic growth. The Minister has pointed out the strain in the public finance because of the decline in collection and the new areas of spending. Also, currently, the Investment Income component in balancing the Budget over the business cycle is playing a crucial role. It is good that the Government has, on its own, only allowed 50% maximum of its Net Investment Income to be spent in the year, even if there are strains on the Budget. The Budget measures are targeted to those directly in need of assistance, and are supportive of the worth ethic. I applaud these measures which are specifically targeted to those in need. Workfare is always preferred to welfare, especially when dealing with those who can work, and want to work. Some observers have mentioned that the Workfare Bonus can be likened to a negative income tax. I hope not. I am glad the Minister is only making a one-off decision in granting this Workfare Bonus - to share the Government surplus over its term with the people. I urge caution in likening this Workfare Bonus to a negative income tax. It can be quite unwieldy to implement, and experience in the US has not shown this to be effective - certainly, not as effective and impactful as targeted assistance for the needy that our Government has embarked on in recent years and has built up a database for. The question we must ask in all these Workfare Bonuses and transfers from Government surplus is: Who is paying for all these? They are all paid from the Government revenue, which are taxes from the businesses and the taxpayers. The longer-term solution is for job redesign and for better paying jobs through training.”
“The Minister mentioned that he is looking into the review of the estate duty so that the present system of exemption set at $9 million for residential properties and $600,000 for other assets may present biases for investment choices and inter-generational equity. I support this approach. The tax system should not cause people to put so much savings into the next bigger house because it is a better return. And resources should be allowed to channel into creating more businesses in competition and more jobs for the economy. As I look through the Budget figures for Total Expenditure over the last 10 years, this Budget's Total Expenditure at $30.6 billion is the highest. The Subvention and Transfer at $4.5 billion is also the highest. If we add the Special Transfer of $3.6 billion, we are having Total Transfer at almost $8 billion, which is 27% of Total Expenditure. In FY2005, the figure was 12%. This is quite a sizable jump and one which we have to be very careful about. The headcount on the Government Ministries has gone up substantially over the past 10 years. In the Headcount Table of the Ministry, the figure in FY2005 is the highest, at 112,156. These numbers do not seem to corroborate with the Minister's statement about a 2.9% reduction in headcount in FY2004 by the Manpower Management Framework, as mentioned. A footnote in the Budget Table tries to explain this. With the implementation of the Manpower Management Framework, the headcount is supposed to be lower. Why is the forecast for FY2006 even higher at 114,004, an increase of 1.6%? I appreciate the Minister's concern about controlling headcount and can even understand why headcount in the public service in the last few years may have gone up because of the need to create jobs.”
“I would like the Minister to know that one such scheme, which has discriminated against local businesses, is the Warehouse Retail Scheme administered by EDB, under which foreign-owned retailers were given industrial/warehousing land next to the HDB heartlands to be used as retail space. Sir, the difference in cost between retail space and warehouse space is 10 times. Big local retailers were not even considered. Apart from being unfair, this is also an issue of putting unnecessary burden on local businesses, because of favour being placed on the foreign retailers, and these are not even new foreign retailers. These are retailers who have been here for decades. And these so-called flagship stores, as mentioned in the Annual Economic Survey, are not even new retail formats which we do not already have, and we have seen them all over the world. We are not asking for special favours. We are only asking for the chance to compete for the land equally. These foreign retailers are not even investing in the land and in the warehouse. As reported in the newspaper, a GLC company is building it and leasing it to them. I speak with some considerable knowledge of this, because I run the logistics operations for fast-moving consumer goods in both HACCP certified Fresh Food and Ambient Products for the biggest local retailer in Singapore, with a shorter cycle time by far than the nearest foreign retailer competitor here. This is not a boast. It is a fact. I feel that this must be addressed by the Minister so that foreign and local businesses can be treated on a level playing field because the world is flat.”
“Generally speaking, talking with people in business, I find confidence in the economy all round, and the economic prospects optimistic. And despite some Avian flu threats or some events that may threaten the peaceful development, the trend for growth in Asia, with China, India and Japan leading the way, is unstoppable. It shows that our Government's economic policies have successfully adapted to globalisation in the manufacturing, R&D and design sectors. Also, that Singapore is making its mark as an international hub for finance, services, air and shipping services are showing results. Many of the policies have been adopted, coming from the consultative committees that have been set up for such studies, with feedback from the business sectors and the community. Many of these policies have come from Members of the House. Some have been implemented a little late. But all in all, I must say that the Government has been receptive to ideas and suggestions from the private sector. The Minister has proposed many specific measures to attract new investments to our economy in manufacturing and services, in our knowledge economy and to maintain our competitive tax environment. These tax incentives are targeted specifically to encourage business and investment. I have no quibble over these measures. My plea is only not to bend backwards, at times, to favour the foreign investors and therefore discriminate against the local ones. Here, I am unlike Dr Chong who spoke just now for assistance for the SMEs. I am asking for equal treatment.”
“Mr Speaker, Sir, I speak in support of this Budget proposal by the Minister for Finance. Ever since I was a student of Economics at the university, I have been reading the annual Budget Statements in some depth every year. There were some landmark Budget Statements from some of our previous Finance Ministers, such as Dr Goh Keng Swee, Mr Hon Sui Sen, Mr Lim Kim San and Dr Richard Hu. They reflected the deep concerns of the times, the economy facing challenges from unemployment, the oil crisis, economic restructuring, globalisation, the Asian financial crisis, economic growth and income inequality, and an ageing society. In my view, this is one such landmark Budget by the issues the Minister has addressed, and the detailed measures he has put forth. I will begin where he ended, "that this Budget aims to build a vibrant economy where opportunities abound and to build an inclusive society where no one is left behind. The prospects for Singapore are excellent. Asia is on the rise, powered by the booming economies of China and India." There is no better summing up. To say that prospects for Singapore are excellent today after all the economic uncertainties in Singapore over the last few years since the Asian financial crisis of 1997 is not to be taken lightly, and not to be taken for granted. A sum of close to $3.6 billion is being transferred to the people, so that all, especially the ones in the lower-income bracket, will benefit. This deficit that is estimated for 2006, however, is balanced over the business cycle, from the surplus accumulated over the previous years. Although the Government has undertaken another such sizable deficit in 2001, this time, it is one with optimism, with light at the end of the economic growth tunnel.”
“Since there are so many anomalies administered by the two agencies up to now, and because so many retailers will be affected, I urge the Ministry to freeze this scheme and review the procedures and policies entirely and put up the designated land for tender to be administered by one agency.”
“Sir, I would like to declare my interest as I am working in the field of warehousing and retail. The Warehouse Retail Scheme, as announced last year, essentially allows the use of industrial land for retailing. Industrial or warehousing land is a fraction of the cost compared to commercial land. For example, industrial land would be 50 cents to $1, whereas warehousing rent may be four or five times. This scheme was introduced to facilitate many foreign retailers who have found it difficult to compete in the market for the kind of space to play out their so-called retail formats in Singapore. In countries with big land space, like US or Europe, the so-called retail formats require big areas and are, hence, located outside the city areas and started by locating at intersection points on main highways. The French word for crossroads is "Carrefour". Under the Warehouse Retail Scheme, local retailers submit their proposals to SPRING while foreign retailers who have been here even for decades submit their proposals to the EDB. Naturally, the treatment is uneven. Many Members have expressed this view earlier. Foreign retailers are also granted land outside the announced patches. The Government has always said it believes in competition and transparency. With something so different as the Warehouse Retail Scheme involving the alienation of land and variation from announced policies, should the Ministry not ensure transparency and equality in treatment of all local and foreign owned companies in Singapore? This is particularly so when competition in this field is so intense.”
“Mr Chairman, Sir, some years ago, the HDB piloted a scheme to allow the exit of some of the retailers from the shops in the neighbouring housing estates. Subsequently, this pilot scheme was stopped. As a result, many of those units that remained after some of these shops had exited, their business has gone from bad to worse because of the lack of traffic, mix, and so on. So I was wondering whether this new retail scheme that the Government is coming up with, for allowing the exit of retailers from the neighbouring shops, would include lessons learned from the pilot scheme that was done some years ago and, whether we should not also consider widening the scope of this restructuring of the retail shops by considering the right proper mix, as mentioned by Dr Amy Khor just now, including the possibility of lower rentals and so on, to allow this sector of people to carry on with their trade. The question is, after they exit from the retail shops which they manage in the neighbourhood, what are these people going to do? They have exited their business, they do not know what to do, and after a while the money is gone. So I wonder whether the Minister will address this. Assistance Measures for HDB Shops”
“Sir, I would like to ask the Minister to give more choices, in terms of compensation or alternatives and flat type allocation for those people who are affected by the Selective En-bloc Redevelopment Scheme. Children should be, as best as possible, allowed to help pay for their parents in some of these choices that they have to choose. Many of the SERS type of choices which are offered may have to be friendly to many of the older citizens who are affected by the SERS scheme. So, I suggest that the Ministry should consider going for two-room or even studio units within this kind of compensation flat types. A lot of the people who are affected by these SERS schemes are old people, and I caution the Minister in the fact that many of them fear going into debt to finance any purchases.”
“Sir, the MUP Programme has been in place for some time and it applies to units which are 17 years and above. I would like to ask the Minister why are 40-year old flats still not upgraded. The reason I am concerned about this is that while the priorities are accorded all round to the different constituencies but for the 40-year old flats, the piping, lifts, ceilings and corrosions are all day-to-day issues that the residents have to live and put up with. So I would like to find out what are the reasons for this delay and why is it so difficult for HDB to make up its mind on this. I am referring in particular to some of the flats in Queenstown and Margaret Drive. Town Council Sinking Funds”
“Sir, I would like to ask the Minister whether there have been any benchmark or yardstick studies with other armies on the general fitness of our SAF's operationally ready servicemen. I do not mean the evaluation of our army with other armies when they do joint or planning exercises. I mean the physical operational fitness as well as the competencies of the soldiers on the ground.”
“Mr Chairman, there is an increase in the operating expenditure of $648 million this year for the Ministry of Defence. I would like to know what is the rationale for this increase. Of course, we know very well that overall budget has been trimmed down but, in the area of defence, I could understand that there is a fixed rate to the GDP that we worked on. But why is there such a big increase in this year's operating expenditure? The other question that I want to find out from the Minister is this. Given the fact that SAF is our fundamental national force to safeguard our peace, how does the SAF, as an organisation, measure its cost-effectiveness in running the organisation as such. Would the Minister be able to give us some idea of what kind of KPIs or performance indicators that he has, or the SAF has, to measure its effectiveness, cost-wise?”
“Sir, the SAF has been involved in peacekeeping missions on several occasions, in East Timor and the Middle East, typically in the area of logistics and medical services. I wonder whether the Minister can enlighten me on what kind of role the SAF can play in this area of peacekeeping missions. Does it mean that in the future, this is going to be a more regular feature of the SAF's role and how does it in any way affect our development as well as our doctrines? Also, I would like to find out whether the peacekeeping role that we have performed so far, how does it measure up and what is the kind of feedback that we receive from these international agencies? Piracy”
“Sir, I just want to add on to the points brought up by Dr Warren Lee. On these international organisations and UN agencies, I would like to find out how we are being regarded in terms of our performance. Obviously, we are always ready to help. We are always ready to have the Singapore International Foundation and people willing to contribute effort and so on. But how are we actually regarded and to what extent the Ministry see this kind of efforts by Singaporeans valuable in our international diplomacy? Overseas Property”
“Mr Chairman, Sir, I share some of the views expressed just now by Mr Tan Soo Khoon on ASEAN's regional bloc issues. My concern here is, with the prospect of this new framework that has been discussed or raised - ASEAN + 3, including dialogues with China, Japan and Korea - how does the Ministry look at this new enlarged framework in the context of further and future development of ASEAN? Obviously, the initial discussion on ASEAN + 3 has been on currencies, capital flows and investments in the region. But something could perhaps be developed out of this to enable ASEAN to move towards a new level. We have seen the development of EU and over the last decade, the tremendous development. Of course, there are problems always with integration but, at least, attempts are made truly and honestly forward in integrating economies, bringing down tariffs, and allowing free flow of factors of production, and so on. My view is, with all these talks and dialogues which have been going on in ASEAN for years, leading not necessarily to very visible goal-posts, should we spearhead or really review what could be done? What is the Ministry's thinking towards this future development, and whether in the development of things in the world, if we continue to talk and not walk the talk, would ASEAN run the risk of being irrelevant? ASEAN and Myanmar”
“They make good sense. Finally, I support the Budget policies of the Government. The Minister has come out with many creative and imaginative policies to address the needs of all Singaporeans and it provides the framework for the right approach and solution to the many needs of our society.”
“The man-hour cost of the worker may not fall, but with the right equipment and process, many service jobs, such as cleaning, food and beverage, logistics, retail, and healthcare sectors, could be redesigned to allow Singaporeans to work at a wage level that must make sense for the workers to do so. The value-added per dollar of input cost, labour and capital combined, must be higher than before, at an improved service level required by business and workers. Mr Lim Swee Say is absolutely right. If there are so many jobs available, and Singaporeans could not be found for these jobs, we have to ask what is wrong with these jobs. Incentives and tax breaks could be given after implementation and achieving results. They could be audited and determined for these results by management consultants with benchmarks and yardsticks of measurement. And the end result is higher productivity and better employment. As long as we do not shift away from the labour intensity of the job, our Singaporean workers would all the time be forced to compete at the bottom wage cost as the Bangladeshi, the Thai, or the Malaysian workers, in their midst. To shift to a higher capital intensity of the job would mean higher cost, but productivity in terms of value-added and quality and standard of service would be better. With this, training and skill training matter. Wages would also be higher and payment and incentive schemes in the job must be made to encourage higher productivity to pay for all this. Hence, capital allowance should be granted to encourage this shift for mechanisation. Tax breaks could be given for effectively employing more Singaporean workers and raising productivity. Favouring local content and raising productivity are not sins of commission, even in a globalised market economy.”
“All companies in the same industry face the same environment in the market place but every company faces a different set of problems from another because of legacies, different customer needs, different management types, etc. It is too difficult for bureaucracies, or worse, community development groups to map out the required measures. The Government wants to encourage job redesign to get more Singaporeans to be employed. It should incentivise successful schemes implemented by management. Management must be the driver. I would suggest that we give more tax allowances to successful management schemes. Management must devise their own schemes. If they are good, they will find the right answers. All the equipment that facilitate more friendly interface with the workers - male, female, young or old, skilled or not-so-skilled, in the common service industries, whether in cleaning, food and beverage, material handling - have already been invented, in production and used somewhere in the world, in the advanced countries and in the not-so-advanced countries. The difference is whether management could use this equipment and exploit them, to improve the bottomline and to achieve some tax breaks with this process improvements. Success stories must be rewarded and the stories must be told to educate mindset shifts and change perspective. The redesigned exercise would be futile at the end of the day if it was only to lower wage cost and does not raise productivity as measured by increased value-added per worker.”
“All through the 80s and even into the 90s, the Construction Industry Development Board was trying to standardise and set rules and controls for the construction industry to try to raise the standard of building and construction in this industry. It never quite succeeded. The construction industry today has been and remains a laggard in our economy despite huge amounts of investment in this sector, with one of the lowest pay, highest cost, lowest productivity and lowest quality in any industries in Singapore. A lot of construction sector jobs were created for the migrant farmer workers usually from somewhere. The result is a sad construction industry with a hard landing. I do not believe that it is primarily because Singaporeans cannot take the rough job of the construction industry. Look at how fast and neat the Australian construction workers build bungalows and high-rise buildings despite their many restrictions and practices, and compare them to our construction sites and our construction industry. They have already streamlined their construction processes and practices. We have not quite found out what went wrong. It is enlightened companies in the competition of the market place through enlightened management that will think out processes to solve problems faced by the companies, within the context of the industry. The first thing we should do is to give incentives to successful innovation either in the form of capital allowances or incentives for the use of equipment to facilitate employment of workers and training of workers when they lead to higher productivity.”
“But making three years of projected GDP in such an open economy like Singapore is really difficult to fathom and most likely wrong. Hence, while I agree with the counter-cyclical approach in fiscal stabilisation, and the policy framework, it would be really interesting to fathom with any level of confidence how the three years' GDP will be projected. Because upon this projection depends on whether the counter-cyclical policies and stabilisation are correctly targeted. I find that the intention to allow carry forward and carry back of losses for companies and the announced lower rate of taxation for individual income tax, effected over the next two years, shows very imaginative ways that the Ministry is responding to concerns by many SMEs to corporations and individuals to income tax payments. It is really not easy for the Ministry of Finance's officials to administer taxation with one hand and another for beneficial allowance and reduction, taking into account the pleas of smaller companies. I have heard this feedback many times. It shows the Government does listen. And it shows that SMEs' interests are addressed in this Budget. The Minister has also announced a Re-Employment Assistance Programme, a nation-wide effort to redesign jobs, combined with training and also a financial scheme to encourage job-seekers to take up and stay with the jobs. In my view, the best approach to redesign jobs and getting the process right is to incentivise companies to upgrade, to innovate, to train, to raise productivity and to pay workers more for their higher productivity. These are all tied together. The worst way to do it is to try and write a manual on what has to be done. I give an example.”
“Discretionary flexibility by the Ministries in adjusting their spending to match their cashflow situations through advances, carry forward and rollover are good adjudicating measures and the Ministries and the controlling officers should ensure implementations are efficient. I would not compliment this framework, even though it looks good, however, were it not for a further 3% cut in the Ministries' total budget for 2005. So I welcome this and I believe this kind of cap measures would further provide the limit for the Ministries to operate and the pressure for efficiencies to result. Having said this, the Ministry's Budget Highlights also mentions it is working on a smoothened GDP projection, in order not to make budgetary policies pro-cyclical. This smoothened GDP framework or, what they call, sGDP framework has been implemented in FY2003/2004. I am glad that the Ministry has adopted this counter-cyclical stabilisation fiscal policies approach. But really, running budget surplus of up to 2.5% of GDP is also counter-cyclical when the economy is growing well, as in previous years. The devil is in the details. What is important is the Government revenue must not be too high as to make the private sector's economy carry too much burden. Running a low budget surplus or even a slight budget deficit with a lower revenue collection in taxes and fees, such as now at 16% of GDP, makes the Government and the public sector more beneficial to the economy than running a high budget surplus with almost 20% of the GDP of revenue in collection some previous years not so long ago. A smoothened GDP is based on three years of historical GDP and three years of projected GDP. I can understand three years of historical GDP and even a moving average of some number of years.”
“But as we know, it is difficult for many of them to get jobs. We have to realise one thing. Many of the so-called retirees, aged 65 and above today, did not really retire with such a nest-egg. Salaries were low in the 70s and 80s. We know Singapore was transformed from a third world country to a first world country in one generation. That is a cause of pride for all of us, 25 years. But along with it is a generation of workers paid third world wages during those times when we were a developing economy and who are now retired, and faced with first world cost of living. We really have to think hard how to help these retirees find work, income or assistance schemes for them to sustain. I have spoken on the reverse mortgage scheme for HDB owners, past the age of 65, many times in Parliament for many years. Many people say that the private sector insurance companies or banks have tried this for private housing and found it to be not very successful. In truth, the private sector houseowners do not need this scheme. Their need is different. It addresses a different market, different size, different needs, different income, different age profile and different asset-type with different regulations. So I sincerely hope the Government should study into this seriously. I note in the Budget Highlights that the Government has fine-tuned its block budget framework for Ministries to ensure that dollars spent by the Ministries are best allocated and spent effectively by themselves under an overall cap by the Ministry. This is a correct approach.”
“Mr Speaker, Sir, I wish to speak in support of the Minister for Finance's Budget for FY2005/2006. Going through the fiscal operating revenue and expenditure figures for 2004/2005, the primary balance deficit of $1.41 million for FY2004, compared to the original estimate of $2.53 million deficit shows good prudence and financial management on the part of the Government. Otherwise, with the reduced revenue, especially about a billion dollars or so coming from the motor vehicles and Vehicle Quota Premium, and no controlled management of expenditure, the primary balance would have shown an increased deficit. I would like to compliment the Minister also for the special transfer mechanism to transfer wealth and relieve some of the burden for the more needy in our midst, including the aged. Various Members have talked at length on some of the problems faced by the aged in our society. These transfers will be used by the needy, including this new fund called the ComCare Fund. The present mechanism of these special transfers does not represent the usual way transfer payments from Government to targeted sectors usually work. For example, the Medifund and the Lifelong Learning Fund are really endowment funds, and the spending on them depends on applications from the respective administering agencies, such as the CDCs and so on. I share the same opinion as the previous speaker yesterday, Mr S Iswaran. I believe the best way to help the poor is really to provide them with jobs which can enable them to earn an income. It is really surprising and yet very humbling to me to realise when I come across so many 70-year-olds who are begging to be given jobs for them to do, to support themselves. I have come across so many in my meet-the-people sessions.”
“But even if some element of social discount is applied, I would even argue that it is reasonable and necessary. In the same way that the Government was able to finance the Home Ownership Scheme of the HDB flats all through the past 40 years, I am confident the refinancing can be done for this section of the aged who own their flats. Today, if an aged owner wants to sell his or her HDB flat, he or she cannot rent a HDB flat for 30 months. During this time, he or she has to rent a flat from the market. If the Government frees up this rule, then the person, after selling his flat, can rent from HDB, but this will put pressure on the limited pool of HDB rental flats, competing with the other needy Singaporeans. Hence, I urge the Government to work out such a reverse mortgage scheme for the HDB flat owners who have passed a certain age and who own their flats. 85% of the population stay in HDB flats. A small part of the housing stock and private sector wealth can be made liquid for the aged, without disturbing them and allowing them to stay in their flats and without having to move or to downgrade. The President's Address has set forth the new Government's direction and priorities. It is hard to disagree on the overall priorities. However, I believe that even with these seven priorities, there are certain aspects that are more urgent for policy review. Sir, I support the motion.”
“Sir, I brought this matter up before at various times, and I think several Members of Parliament also brought this up, and it concerns this issue of reverse mortgages. I really believe something can be done and must be done to help these people to liquefy their asset, to enable them to have some annuity income for them, as they only have their HDB flat as their asset. We must recognise this asset profile of our aged and provide some form of financial scheme for them to live off their savings from their fixed assets. Currently, the desperate ones can sell and rent from somewhere another flat for almost $800-$1,000 a month, as allowed by HDB if they were to sell their flat and rent another. But, at this rental, the money will disappear in no time. We should come out with a reverse mortgage scheme for certain aged Singaporeans who have paid off their flats and who qualify, say, over the age of 65, so that they can continue to stay in their flats and have a monthly sum of money as income from the annuity. They can supplement this further by renting out a room. This scheme will allow them a home to live in, with an assured income for about 15-20 years as calculated. A scheme like this must be found because a good portion of our aged people have this asset, and probably this asset alone. But they have little or no income. I have come across many of such cases in my area in Queenstown. Many of these aged citizens are well past 65 and into their 70s. I am talking about the ordinary prudent aged Singaporeans. With a 15-20 year term, the annuity for a $120,000-$150,000 flat can be quite a few hundred dollars per month. And at the end of term, of course, the flat is transferred. This scheme should, as best as possible, be market financed.”
“And if the Ministry of Health is feeling its ground presently a little bit tentative in this search for redirection, I can understand. But I subscribe broadly with what the Health Ministry is now trying to do. I think it has redrawn the boundary and redefined the scope and limits of the various sub-sectors and players in the healthcare industry. One important feature in this new healthcare is without doubt a new health insurance scheme, which is long overdue. Medisave and Medifund have to be complemented by a new medical insurance scheme with appropriate co-payment features that will answer to the needs of the population, a group of which unfortunately suffers from a variety of illnesses at any one time. So this new insurance scheme must cover a wider range of diseases and illnesses which are common to Singaporeans. Such a scheme must answer to the needs of those who are unfortunately ill. It must minimise their financial burden and the burden on their next of kin. In pooling resources, we will better be able to tackle the cost of healthcare more equitably. The final area I want to cover is on financial planning for Singaporeans. A generation of Singapore workers who were in their 20s and 30s, when they were young during the 60s and 70s, are now in their 60s and 70s. During those times, the wages that they were earning were not high. Most of the savings of this generation of Singaporean workers are now in the form of their HDB flats. Many of them, for example, purchased a 3-room flat for about $6,500 at those times. I am talking about the 60s and possibly in the 70s. For most of these workers or retirees, this is their major asset, which today is worth about $120,000-$150,000.”
“I think the area of traditional Chinese medicine may be much misunderstood, but it is an area that we in Singapore should consciously and deliberately develop to incorporate it into our Western medical healthcare treatment system. So I agree with the Ministry of Health's intention to review and standardise practices for primary healthcare providers and streamline operational process to minimise waste and unnecessary visits and tests. The aged are very concerned about medical costs. So it is reassuring to hear from the President that MediShield and Medifund would help them to lighten the burden. However, the MediShield programme needs to be reviewed to answer more effectively to the needs of the people. Dr Warren Lee has covered quite a bit on the MediShield programme. My main concern is we should not be too exclusive in developing such a MediShield insurance programme. Of course, there would always be attendant risks and premium to be calculated, but for a programme such as MediShield to cover for general catastrophic illnesses or for illnesses of the sickly, we should amply define it broad enough so that sufficient coverage would be given for the ordinary citizens in the course of their life-span. In working out this most desirable healthcare model for us, we are treading on ambiguous ground, and somehow the examples of the developed countries so far are not necessarily the best one to go by. The Americans spend about three times or more of their GDP on healthcare than Singapore and I do not think that their system of National Healthcare or hospital management is something we should emulate if we are to contain healthcare cost and to be efficient. We have to come out with our own.”
“The older Singaporeans, I presume people in their 50s - and we are not yet quite an aged society - are understandably today very concerned about their jobs, health and families. They still presently occupy an important group of the economically-active in our economy. They may be older but they have a wealth of experience and they could still contribute much to the economy as management, workers and decision makers. More important, a good many of our citizens in this age group today have families to support and a good many of them are dislocated from previous employment or businesses due to difficulties in the last few years. So I think we must reassure them and do our utmost to get them back to the mainstream of economic life. The second area I would like to address is on the area of healthcare, which the previous speaker, Dr Warren Lee, has so amply covered. Healthcare is an important concern for our older citizens, and citizens in general. I support the Ministry of Health's intention to review the healthcare industry, comprising its network of hospitals and polyclinics and a wider pool of GP clinics so that primary healthcare could be delivered most efficiently and at lower cost. I agree to a lot of the suggestions and policies as set out in the Ministry of Health's Addendum to the President's Address and I support, in particular, the Health Services Development Programme which aims to pilot this new health services and medical capabilities. I urge, in this respect, to give some special role, as mentioned, to traditional Chinese medicine, under this new healthcare strategy and direction.”
“This could be done by the appropriate use of equipment and funding schemes or incentives, as have been suggested by previous Members, and this would make changes that are meaningful for business and management to adopt. People also need to be retrained, and to be constantly retrained, at any age to work with the appropriate equipment to do the job. When we visit European countries, US and Japan, we sometimes wonder why certain jobs get done in the most basic manner - not because these countries are not technologically sophisticated, but they are done. There are two economies - one, a very high technology and sophisticated economy, and another, a very basic and primary service sector economy. This is in the area, for example, of office cleaning. Somebody mentioned about directing school traffic yesterday, or visibly senior citizens at the shop floor or cash counter in the Wal-Mart Supermarts that you see all around in the US. These jobs are there because very conscious effort was made by management, and I suppose also in these countries by communities, organisations, and the authorities, to seek out the resources for the job and, with the appropriate incentives and equipment, to be done at the right economic price. These businesses and authorities have incorporated a social role in their scale of value and management. So while we certainly want to encourage our young to scale greater heights, I think we should also not forget the older ones - whether older workers, entrepreneurs or senior citizens. I am saying older ones, and I am not saying senior citizens or retirees alone. Older Singaporeans are also fit and able and have plenty of experience.”
“Thank you, Mr Speaker, Sir, for noticing me and giving me this chance to speak, seated as I am now from the rear end. I would like to speak in support of this Motion of Thanks for the President's Address. The seven priorities that have been outlined in the Address are certainly all that we could subscribe to and, translating this vision into reality, would definitely challenge this present Government. I think no one could disagree too much with the outlines as set forth. But, as we are constantly reminded, the world is uncertain and many things that we do not expect could often throw us off our guard and, at times, when we least expect. Various speakers have spoken at length. I would like to just focus on certain areas. If we were to ask the average man in Collyer Quay or Jurong today what his major concerns are, I think not quite a few of them, or most of them, would centre on the state of the economy, job security and training to earn higher income. While the economy is said to have grown by 8% last year, yet many middle-age men and women with families to support, are in tough straits - having lost jobs or businesses. I hope, while the economy may seem to have turned for the better, creating jobs for Singaporeans, both young and old, ought to be raised as a very high priority issue. Training and job creation are important corollary features of investing in people. My concern is, if the older workers are to stay active, retire later and provide better for their old age, as mentioned in the President's Address, then they have to be employed longer. The work available must be redesigned, by process, so that the older workers are able to handle them.”
“The rest of them should be left to market demand. The Ministry of Health should also consider allowing choices by people, by allowing TCM practices at prescribed MOH clinics or hospitals. These are currently done privately by many non-private bodies, such as Chung Hwa Clinic and the Kwan Im Hood Cho Huay. The latter has helped my constituents in Queenstown, for example, run a free TCM clinic for more than 10 years. And patients make small donations in a box after their treatment. Believe me, there is a regular queue waiting for treatment, young and old of all races, for the last 10 years. So, it cannot be without use or effect, when the sick keep coming. It must be useful and effective. It must have answered to the need when it has lasted more than 10 years, and it is still continuing. So, alternative medicine and TCM can prove to be effective and more cost-effective, and may be more satisfactory than western medical treatment in certain fields. Subsidy for Providers of Home Therapy”
“Sir, I believe there can be more that we can incorporate traditional Chinese medicine into our healthcare system. Western medicine and the healthcare system have no doubt made advances beyond the human imagination. However, I am not sure whether the 14% of GDP the Americans spend on healthcare is any more effective than the 8% or less which the Europeans or Singaporeans spend on ours. I believe that traditional Chinese medicine should have its place. Traditional Chinese medical practices have always been incorporated in the social and philosophical framework of human life and well-being. It has existed for thousands of years and it has proved to be lasting. So, I hope the Minister can incorporate traditional Chinese medicine into our healthcare system. I am told Chinese medical care is aimed at the gradual approach to treatment, emphasising the social, mental and the psychological approaches to life, living and well-being. I think these descriptions fit well into modern and even new-age needs and perspectives on living and well-being. One way is to systematise the body of Chinese medicine practitioners, including the training and education of these practitioners, to link them with Chinese medical bodies overseas, such as in China, on a more intensive level, including the exchange of doctors and regular sharing of development knowledge. Once this is done, essentially, one would have taken control of the supply stream of relevant TCM practitioners and of ensuring that they are of a certain international standard. Another way is to identify the area of medicine where TCM is considered sophisticated and effective, such as in the area of acupuncture, which has been mentioned, or these areas can be determined in consultation with other experts.”
“Finally, for patients who are recovering from operations or illnesses and require nursing care - I believe presently nursing careis not insurable - I hope that the Minister could consider including downstream nursing care to be incorporated into the insurance scheme for healthcare charges under this means testing regime.”
“Madam, I share the views of many of the previous speakers regarding means testing. I would urge the Minister to be cautious in moving this means testing scheme. Even professional and middle-class people are arguing that they should not be denied the services in hospitals if they choose to go for a "C" class or be charged at a subsidised rate. The argument is, why discriminate them of this right of choice? After all, they have paid all the taxes that they have to pay. And there is this fear amongst the generation of the post-war baby boomers, who are now almost reaching 60. They are very concerned about the healthcare charges for their old age. I urge the Minister not to roll out the means testing scheme unless he has in place a health insurance scheme in adequate range and cover. There has to be more work done by actual studies to arrive at the premium and scale of this insurance scheme. The coupling of this means testing to a fully comprehensive insurance cover scheme should be tightly done before we implement this means testing. I believe that the present MediShield scheme is not comprehensive enough. Should the Government not work towards liberalising this MediShield scheme to let it be completely available to insurance companies so that they can work out the right product through risk pooling? It may be very useful when certain treatments or procedures are going to be expensive or very costly than the differential rates of subsidies, like what was mentioned by Dr Ong just now.”
“Sir, I thank the Minister for his answer, and I beg leave to withdraw the amendment. Amendment, by leave, withdrawn.”
“I am sure SIA is a great airline. But I also believe that the top class Changi Airport is as much an asset to SIA and Changi Airport's success rubs on SIA. With newer long flying planes, will the hub status of Changi Airport be affected and, with it, our SIA? I would like to have the Minister's comment on the technology challenge to our air hub status and what he sees of the future of our civil aviation sector in the economy.”
“I find the stated strategy of the MOT and CAAS to reduce cost of operating at Changi Airport very comforting. For example, the three main areas that MOT and CAAS strategise to reduce costs are in the area of liberalising the ground handling sector, reviewing charges and, of course, reviewing cost of land in relation to other airports around the world. The authorities have also stated a package of incentive schemes, for example, $210 million fund for air hub development, $40 million growth incentive scheme, $45 million SARS relief package and $10 million air traffic development scheme. Many of these schemes are aimed at where the mouth is, at the users of Changi Airport. When the Civil Aviation Authority of Singapore is on top, they are talking about liberalising the downstream sector. I detect these responses are quite different, for example, from the way our sea hub status was guarded some years ago till the customers voted with their feet. I wish to congratulate the Minister and the Civil Aviation Authority on this forward looking approach. The civil aviation sector contributes as much as 9.6% to our economy on account of the downstream and ancilliary services. With so many changes in airplane technology, planes flying longer, non-stop, for example, the Airbus 380, and the changing route pattern, I believe these planes can fly non-stop from Sydney to London. With the changing technology of planes, will transfer hubs, such as Singapore, continue to have a slice of the international air route business? Is there still a need to stop for refueling or to connect flights after all the planes can fly long distance to any destination? I was told that the Emirates Airline ordered 48 Airbus 380, while SIA only ordered 10, which would be delivered in 2006.”
“The berths are full to capacity and they are probably building new ones. Hence, there is currently no position to attract new customers. Bearing in mind that PSA brings many downstream economic activities to the economy, is the Minister satisfied that PSA will continue to ensure that port services, which are responsive to market demands, will bring more benefits to the Singapore economy?”
“We were told again that Singapore has become the world's busiest port for shipping tonnage and we are the top bunkering port with a record TEU last year from PSA of 18.4 TEU. So we aim to be both a world-class hub port as well as an international maritime centre. However, it is significant to note that in 2003, PSA did its record best TEU at considerable discounts to its tariffs, the year of celebratory discounts, so to speak. I do not know the exact number, but I believe it to be in the range of at least 20-30% of the tariffs. For several years, I have argued in this Committee the need for privatisation and competition in port operations, in berth operations and terminals, in downstream operations, and I have also pointed out the risk of PSA as a monopoly dinosaur earning 50% of profits before tax on turnover just barely a few years ago. The good performance of a re-awakened PSA shows the importance of sensitivity to the voice of the market and competitive response to market signals. Not even our so-called renowned locational advantage, connectivity and IT superiority can retain the top two shipping customers when an upstart port from across the Causeway offered privatised berth operation. The challenge I would pose to PSA is, "What's next?" As I argued last year, the world's shipping industry is changing rapidly with supply change and industrial structural changes. The single factor which accounts for businesses going out of business is the failure to respond to industry-wide changes. Although volumes and TEUs have hit a record, operating profit of PSA has fallen drastically. 2002 saw operating profit at $740.6 million compared to $1,080 million in 2001, a fall of more than 30%. We should note that the pull to Tanjong Pelapas has not stopped.”
“On the Minister's unenviable offer to the GPC to take on this task of looking at the new model for the CPI+X, I have discussed with my members of the GPC and we have agreed that we should take on this task, and we will not shy away from it. However, I would like to urge the Minister that the GPC has got quite a good record in the past of making good suggestions to the Ministry of Transport, in particular I would like to add the open bidding system, the VQS report that we did, and also the suggestion that the Ministry should consider privatisation of berth terminal operations by private operators many years ago, which was only accepted recently. So, in that spirit, we will take on this offer and we will consult the experts and the public on this new model which we will make recommendations. Sir, I would like to touch on this topic on port competition.”
“Sir, can you spare me a minute for me to respond to the Minister?”