Edwin Khew Teck Fook
Singapore
“I therefore implore the Finance Minister to consider investing in this sector, looking at the long-term gains for Singaporeans and Singapore. We have the lead in this sector at the moment. Let us not lose it. Finally, Sir, I support the motion to adopt the Budget. 2.00 pm”
“If we take the next step, which is to establish a minimum standard, any products that require energy beyond a certain level are not allowed in Singapore, we will have to do it very carefully because it means that companies are forced to change some of their product lines. But it is certainly on the table.”
“Sir, I just like to ask the Senior Parliamentary Secretary whether it is possible right now, when we see that there are so many proven situations, even with regard to Bukit Panjang Town Council, that there are positive savings, why can the Government not take the next step at this point in time to mandate the use of these lights at least…”
“I hope a considerable part of these sums will be allocated to energy projects, as this is the most important field, now that we have our four taps in place and our water supply is stable. We can now turn to being the world's expert on renewable energy and energy efficiency.”
“What efforts are being made to ensure that as much as possible of the waste materials from these buildings are being recycled? Apart from bricks and concrete, what happens to the thousands of doors, windows, sinks, kitchens, cupboards, toilets, etc, which are part of the en bloc destruction of these buildings?”
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“I therefore implore the Finance Minister to consider investing in this sector, looking at the long-term gains for Singaporeans and Singapore. We have the lead in this sector at the moment. Let us not lose it. Finally, Sir, I support the motion to adopt the Budget. 2.00 pm”
“Most importantly, the Government and private sector in Singapore are in sync. Sir, the world needs to know and be constantly reminded that Singapore will be a centre of excellence, solutions, project financing, carbon trading and a perfect model of a sustainable city with sustainable development as its master plan. We should aggressively promote our intentions and, more importantly, walk the talk. We have done that for water. Let us do the same for clean energy. I therefore ask the Finance Minister to provide a budget to get Singapore there. Abu Dhabi is prepared to spend US$15 billion and have set a benchmark. What are we, as Singapore, prepared to spend? Minister Mentor Lee, when he was Prime Minister, decided to make Singapore a Garden City with the best environment in the whole region. Senior Minister Goh, as Prime Minister, took it further, moving it from a Garden City to a City in a Garden. Now, just last month, the Prime Minister announced, at the sidelines of the World Economic Forum in Davos, that we aim to be a Sustainable City. An Inter-Ministerial Committee on Sustainable Development was set up. PM emphasised that sustainable development will continue to be a priority for Singapore going forward, and that we will "seek to build new competencies and facilitate mind-share across the public, private and people sectors to develop Singapore as an "Eco-Hub". We applaud these initiatives. Let us implement these objectives together. To develop Singapore as an "Eco-Hub", we must promote and establish an environment for alternative energy, energy efficiency and other green businesses and initiatives to flourish. We are helping China build an Eco-City in Tianjin. Let us be an Eco-City ourselves.”
“Sir, what the Government had done in 2007 must be applauded. It was extremely important in developing Singapore into a clean energy hub. We have managed to attract REC, the largest integrated solar cell manufacturer in the world, who will be investing approximately S$6 billion into a manufacturing facility in Singapore. But there are many more companies which are considering Singapore as a base for Asia, but have yet not committed. We should not be complacent and lose the momentum that we started in 2007. There is still much that needs to be done for Singapore to be recognised as a clean energy hub. Many countries also recognise that this sector is very lucrative and we therefore have considerable competition. Examples are: (a) Abu Dhabi recently launched the Masdar initiative - a US$15 billion budget committed to renewable energy, the world's first carbon neutral city, and a global research network. They will break ground this month. Some parts of the initiative will be ready by 2009. (b) Closer to home, Australia, South Korea, India, Malaysia and China have announced aggressive initiatives to attract renewable energy companies and investment into their countries. They have not the holistic approach initiated by Singapore and Abu Dhabi, but we cannot be complacent. Sir, Singapore is in a good position to be a hub for clean energy. We have the infrastructure. Let me name a few - many R&D institutions; we are a major financial centre; a major trading centre for oil and gas, which provides a natural base for carbon trading; well-trained technical population; a safe centre for intellectual property; high-tech manufacturing centre for many of the components required for clean energy systems integration, etc.”
“This momentum started from the 2007 Budget Statement where the Finance Minister, then Second Minister for Finance, stated that "Singapore will seek to participate in alternative energy which is an emerging growth industry." He further quoted a global market of US$300 billion by 2015. In my maiden speech at last year's Budget debate, I applauded the Minister for recognising that Singapore will position itself to ride the wave of alternative energy technology and urged him and the Government to set up a central agency with some teeth to spearhead and come out with policies to attract foreign SMEs and MNCs who are in the value chain in this alternative sustainable energy sector to come and set up a base in Singapore. Sir, the whole energy sector was delighted when the Government started the multi-agency Clean Energy Programme Office (CEPO), and elevated clean energy as a key growth sector for Singapore. In 2007, the Government also (1) invested up to $350 million into clean energy R&D; (2) started the Energy Efficiency Programme Office; and (3) just last week launched the Solar Energy Research Institute. Sir, what escalated the feeling of exuberance from the sector was the Prime Minister taking the chair of ASEAN and leading all ASEAN countries into adopting the Singapore Declaration on Climate Change, Energy and the Environment and the ASEAN Declaration of Environmental Sustainability in November 2007. The year 2007 ended with much jubilation on Singapore's clean energy aspirations to lead in this sector, when the Prime Minister attended the UNFCCC Conference in Bali and, at that conference, strongly declared to the world that Singapore will support research efforts on climate change, sustainable energy technologies and the Bali Roadmap.”
“As such, they are hopeful that, as in past years, the Finance Minister will provide off-Budget measures to help businesses ease the difficult situation that they are currently experiencing, and they feel, will only get worse. Sir, I move my focus now to another area that was not covered by the Budget. This relates to the green and other incentives for businesses and, more particularly, the sustainable energy companies that have, over the last couple of years, set up business in Singapore. I have received considerable feedback from members of the Sustainable Energy Association of Singapore (SEAS), which I chair. At this point, Sir, I would like to also declare my interest, as I run a company which is in the waste recycling and the generation of renewable energy. Sir, the feedback that I received includes: (1) The general lack of green incentives except for the R&D incentives, which many felt they could not benefit from, either because they are pioneer status companies or they are not profitable as yet. There are no incentives for companies that seek to improve the environment. This relates to companies that seek to green their operations or companies that focus on making the environment their business. (2) Start-up companies that are doing R&D appreciate the $20,000 cash grant but feel it is not sufficient to help them in their cash flow. (3) There is no mention of Government support or initiatives for the sustainable energy sector after a positive momentum forward in 2007. Sir, I will elaborate on this third point. After Singapore acceded to the Kyoto Protocol in February 2006, the Singapore Government moved rapidly in 2007 to signal positively to the world that Singapore wanted to be a clean energy hub.”
“Mr Speaker, Sir, thank you for allowing me to speak in this Budget debate. In my speech this afternoon, I would like to focus on two points relating to the Budget: (1) feedback from post-Budget surveys carried out by the Singapore Business Federation (SBF) and the Singapore Manufacturers' Association (SMA), and (2) feedback from members of the Sustainable Energy Association of Singapore (SEAS). Before I share with the House on these two points, I would like to applaud the Finance Minister for presenting a well-balanced "people's Budget" that will benefit most Singaporeans, particularly the lower and middle-income groups and, of course, older Singaporeans. Sir, the surveys carried out by the Singapore Business Federation and the Singapore Manufacturers' Association on this year's Budget did not reflect the same exuberance compared to last year's survey and feedback sessions. Although some praise the Government's long-term initiatives to support innovation and encourage start-ups and R&D, many were disappointed that the Government has not addressed the high cost of doing business in Singapore in areas like rentals, labour, housing, transportation. They feel that the Finance Minister should have provided some immediate relief to help the many businesses tide over this difficult period where operating costs have increased too quickly and beyond the expectations of many businesses. The SMEs, in particular, have been more adversely affected. Many more are concerned that the situation will get worse before it gets better, as the recession and the sub-prime situation in the US set in.”
“Several Members mentioned yesterday about the issue of female homemakers and the gender gap in CPF savings. There was a suggestion offered that husbands could be asked to top up their wives' CPF. But I have another suggestion. Instead of husbands being prodded to top up their wives' accounts, and I think in this case, it would not be very helpful because to those wives whose husbands already are not having adequate CPF funds, it would be of no use, I would like to propose a homemaker's grant or bonus. I believe one colleague has mentioned about mother's bonus yesterday, and that is also another interesting name. To recognise the sacrifices made by elderly women, as they toil to bring up their children and may still be contributing and looking after their grandchildren, we are helping those who have very meagre financial resources, and they should not be penalised because they are family-oriented. I would strongly urge the Minister to consider these women because it is an ideal time to include them in these reforms. In conclusion, Mr Speaker, Sir, we must not forget that future generations of Singaporeans would be enlightened and educated. We often refer to these future generations as possibly a grey lobby to think about. Hence, they will expect schemes, such as the CPF annuity scheme, to have an economically sound design and be sustainable in the long run. With that, I cautiously support the reforms. 3.20 pm”
“Mr Tan Kin Lian, a former Chief Executive of NTUC Income, suggested in his article, "Something to live by after 85" that an independent, non-profit statutory board could be set up by the Government to run an annuity scheme which could offer payouts better than the commercial organisations, thus offering the people a more reasonable option. I would like to ask the Minister if this has been considered by his Ministry. In addition, I would like to suggest that the two-tiered scheme which caters to the lower and higher-income groups with respective differences in payouts and other features to be looked at as well. I am heartened that this is also being considered by the Minister and, probably, the committee that is going to be set up. Recently, there have been reports in the press that some groups would be eligible to opt out from the proposed annuity scheme, such as the terminally ill, people with debilitating illness and those already having annuities. Economists foresee that this would shrink the pool and spell problems further ahead. I echo my parliamentarian colleague, Dr Amy Khor, who suggested yesterday that exemptions should be sparingly allowed. Overall, I feel that the annuity scheme, the way it has been proposed, may bring about greater divisions in our small Singapore society. It thus deserves deeper consideration and involvement of independent actuaries, economists and other local experts before it is rolled out to the people. In this respect, I am encouraged by the announcement yesterday by the Minister that an independent committee will be set up to consider the various options. Apart from economists, people from the social service sector should also be included in the committee.”
“The third change is the announcement regarding compulsory annuity scheme or longevity insurance for those 50 years and below when they touch 55. Only a small sum would be put aside and when such members hit 85 years, they would start receiving a sum of between $250 and $300. There are some flaws in this proposed scheme, but I shall highlight three of them. Firstly, it does not make sense that the sum would be paid at 85 years when the average life expectancy is 80 years. It is not likely that the life expectancy would jump to 85 years and overtake even Japan, which has the longest life expectancy in the world in just five years. I propose a lower start date, for example, 80 years, as this would be more palatable to the public and closer to the average life expectancy. Secondly, of what use would such a small paltry sum be for the 85 years old? It may not even cover the cost of his or her food expenses, let alone medical, transport and other expenses. Are we assuming that the family would be prepared to foot the rest of the bills? Not everyone at that age will have a family. And even if he or she does, the sons and daughters may also be about 65 years old requiring financial security themselves. Thirdly, if the real root of the issue is that Singaporeans are not attracted to annuity schemes at 55, we should make the annuity schemes more attractive. Then they would shift towards buying annuity schemes and they would be covered for life.”
“However, for those who are looking towards 30 to 40 years of working life, it would be fairly substantial as we have seen from the Minister's slides shown yesterday. For the middle-age or young-old between 50 and 65 years, I think the impact would be minimal for those earning above $1,500 a month. The main criticism levelled at our current CPF scheme is not only the low-interest rate but also the fact that it is not index-linked to protect against inflation. At the recent Seminar on Financial Ageing Issues, organised by the Institute of South East Asian Studies (or ISEAS), this was debated at great length. Comparisons were made at the Seminar with developed countries, such as UK and US, where the social security nets are index-linked. I feel that if Singapore is to be a mature, developed country, it should follow this path which then would relieve pensioners and CPF members from the negative effect of inflation. I recognise that this may be a challenging task to do. But if we can learn how other countries are doing it, we can adapt the method to our country. In this way, the CPF model will work even better for every Singaporean in the long run. The second main change is the plan to defer the draw-down age of CPF withdrawal from 62 to 65. For enticing Singaporeans to buy into this plan, incentives were promised by PM Lee Hsien Loong at the National Day Rally speech, for example, the D-Bonus and the V-Bonus. This is a good idea. But, in my view, it should not be made compulsory. There should be a reward system from the Government for those who draw down later, for example, like a top-up, so that individuals will choose to draw down later, as is the case in some developed countries.”
“Kalyani K Mehta (Nominated Member): Mr Speaker, Sir, the CPF is acknowledged worldwide as a nimble compulsory savings mechanism which the Singapore Government manages for the good of its people. At its inception, it was envisaged as a retirement savings scheme but, over the years, it has evolved into a social insurance package allowing members to use their CPF money for a variety of purposes, such as housing, children's education, personal investment, medical expenses and insurance protection. However, over a period of years since 1955, two major phenomena have occurred, ie, the demographic profile of the population has changed drastically from a youthful to a greying one. Secondly, the CPF mechanism has shown that when such a savings scheme allows early and flexible usage of funds, in old age the remaining funds are likely to be inadequate. Perhaps, one other reason could be that the contribution rate from the employer has also been reduced due to changes in the economic climate, the employer's contribution rate has also dropped to 14.5% for Singaporeans below 50 years. In the recent CPF report, I read about the golden era when employer's contribution was 25% and employee's contribution was also 25% in 1984 and 1985, and this would be a dream for many of us today. The main changes that are expected in the CPF scheme in the near future, as I see it, are basically in three main areas. The first is in the rise in interest rate for Singaporeans having less than $60,000 in their accounts. However, only the Ordinary Account could see the 1% increase while the money in the SMR accounts would be pegged at the long-term bond rate. The effect of this change seems to be small.”
“Lastly, there is feedback from some companies that they may not have jobs for some employees at 62. This feedback is mainly from SMEs. Help would need to be given to such companies and employees. Sir, I would like to report that, overall, there has been a good response from companies. I understand that nearly 500 companies are making use of WDA grants to employ and re-employ older workers. This is a good sign that employers do value the experience and skills of older workers. Finally, Sir, I would like to encourage the tripartite partners to work hard on changing the work attitude of maturing workers. Many, unfortunately, are still locked in the old frame of mind that they should retire at 50 or 55, so that they can enjoy whatever life there is left. Their peers and children, unfortunately, also encourage them to do so. They do not realise the repercussions that once they retire, it will be mentally difficult for them to come back into the workforce again. There will be 21,000 working males and 19,600 working females who will turn 60 to 64 within the next five years. This is the target re-employment group. We need to now work on their mental attitude towards not retiring and to continue working. Otherwise, the changes and reforms that the Minister is introducing will, I am afraid, fall on deaf ears, ie, the old adage of leading a horse to water. There are also 230,000 economically inactive unemployed workers from age 50 to 64, and another 110,000 economically inactive unemployed women aged 40 to 49. I would suggest that we start a club to help them re-adapt mentally to re-enter the workforce. This is a huge source of manpower that we cannot afford to ignore. Sir, I therefore support the Minister's proposed changes and reforms. 3.09 pm Assoc. Prof.”
“Sir, in response to the PM's National Day Rally speech on the re-employment legislation, the Singapore Business Federation carried out a quick survey and I would like to share a summary of three points based on the results and feedback from the survey. Although there were 66 sponsors, they represent a good cross-section of companies, large and small, across the various industries and businesses in Singapore. Firstly, employers are, in general, supportive of a flexible framework legislation that is being proposed rather than an extension of the retirement age. The two overriding concerns are that re-employment must make economic sense and that the retention of retired employees does not hinder the renewal and growth of the company by younger employees. On the former, I think a framework legislation allows for some wage adjustment and a reconstitution of employer benefits would be helpful. On the second issue, older employees must be prepared to accept other roles in the same company when they work beyond 62. Next, most companies are looking at health and performance as the two main criteria to offer re-employment. In fact, the major concern of all respondents was the health of the older worker. Perhaps the Government can provide more incentives to help workers stay fit and healthy. I know that the Health Promotion Board has a small incentive grant for this. WDA also provides some funding through its ADVANTAGE! Scheme. NTUC has a programme to help older workers stay healthy. But I think more needs to be done to incentivise both companies and workers to stay healthy since health is a key criterion for re-employment. Perhaps a central fund or an inter-agency scheme could be set up to address this issue holistically.”
“Mr Speaker, Sir, the CPF system that was put in place since 1955 is an institution that we as Singaporeans can and should be proud of. I would therefore like to applaud the Government, the Ministry of Manpower and the CPF Board for taking bold and innovative steps to make changes to our already very successful CPF system to keep pace with fundamental changes in the way we live and the demographics of our population. In the process, I am glad to note that the employers and the unions have been consulted. Sir, because of modern medicine, post-war baby boomers and smaller families, people in my generation are living longer and are faced with new issues and problems not faced by our parents. We have fewer children and young Singaporeans to support us in our old age. So, we need to take care of ourselves for as long as possible as our children have their own priorities in life which include funding their homes, cars, education for their children up to tertiary level and beyond, and the many other needs that are considered the norm of today, like holidays, computers, LCD TVs, golf and social clubs, etc. What Singapore is facing are an ageing population, falling fertility rate and increasing longevity, and therefore having to extend our retirement age is not unique. Many developed economies like Germany, Italy, Spain, Denmark and closer to home Japan, are facing the same problems. All these economies have to make tough political decisions to push back the pensionable age to get workers to work longer and employers to extend their retirement age.”
“Sir, I just like to ask the Senior Parliamentary Secretary whether it is possible right now, when we see that there are so many proven situations, even with regard to Bukit Panjang Town Council, that there are positive savings, why can the Government not take the next step at this point in time to mandate the use of these lights at least in the common areas? I understand that there is a higher amount that we have to pay basically to incorporate this and we know that the long-term savings are that these lights actually last much longer. Most energy is consumed in all HDB common areas. I think we have gone past the stage of pilot testing. Through SPS' own Town Council and also Bukit Panjang Town Council, it is reported that there are all these positive savings. What is stopping the Government from taking the next step?”
“If we take the next step, which is to establish a minimum standard, any products that require energy beyond a certain level are not allowed in Singapore, we will have to do it very carefully because it means that companies are forced to change some of their product lines. But it is certainly on the table. We will study this very carefully. When will it happen? I cannot give the Member a certainty. But I will assure the Member that NEA will study this carefully as we roll out the energy labelling from 1st July onwards to see when is the right time for us to begin to talk about MEPS. But we will consult the industry widely so that we understand their concerns before we move on to the Minimum Energy Performance Standards. MALE STUDENTS RE-TAKING GCE "A" LEVEL EXAMINATIONS (Deferment or disruption from National Service) 8. Mrs Jessie Phua asked the Minister for Education what are the provisions for male students who have been or are soon-to-be enlisted for National Service, to be able to repeat their "A" Level examinations.”
“Sir, I just like to ask the Minister when is the soonest that we can actually adopt mandatory labelling of appliances. Because the longer our households are using them, the longer these items are going to be around. Mandatory labelling, basically, means that we label all our products, even those that are inefficient. Yes, we are providing our consumers with a choice, but the thing is that we are not ensuring that everybody is buying labelled products that meet certain minimum requirements. I think this is a point of concern. If we would like to demonstrate that Singapore as a whole is energy-efficient, it is a small step to go into mandatory usage, at least minimum standards. Once we get to the mandatory labelling stage, it is a small step, and I encourage the Minister to take the next step sooner than later. Assoc. Prof. Dr Yaacob Ibrahim: Sir, I share the Member's sentiment about the need for minimum energy efficiency standards. Some countries which have adopted that as a tool have shown that it has proven to be effective in removing the inefficient products and people therefore adopting more energy-efficient appliances. But we want to take a cautious step as we want to make sure that businesses are able to respond properly and we do not want to introduce a bit of rigidity into our market. The labelling scheme is an important step. We are making it mandatory this year, 1st July, because when we started it, the response was quite low. We did a survey and found not many companies are prepared to come on board on a voluntary basis. So, by making it mandatory from 1st July, they have to put the label to indicate the energy that is required for the product, so that consumers can make an informed choice.”
“Sir, just a point of clarification for the Minister. I understand that there are large sums of money that are going to be spent on R&D. Is there a Masterplan on the EWI R&D for the next five years? If there is not, can the private sector contribute to the Masterplan? Assoc. Prof. Dr Yaacob Ibrahim: Sir, my apologies to Mr Khew. He raised that question earlier. There is a Masterplan for the R&D. We look at what are the capabilities that we have at this point in time and where we want to grow the sector. Based on that, together with an international advisory panel, our staff in EWI have been consulting and we have identified a few areas. I do not have the details here. I am more than happy to provide the information to Mr Khew. We also consulted the private sector. We had dialogues with the various water companies to understand what are their concerns, what are the areas that they like to look into. We set up the $100 million fund for R&D and we called for proposals. We have criteria on how we select the projects that we want to fund, and these criteria are based on the Masterplan. I will be happy to provide the details to Mr Khew later.”
“I hope a considerable part of these sums will be allocated to energy projects, as this is the most important field, now that we have our four taps in place and our water supply is stable. We can now turn to being the world's expert on renewable energy and energy efficiency. This is where we can have a headstart and make a difference and a considerable impact globally. It can only be a win-win situation as we will save energy for Singapore, thus reducing our production cost as well as making an impact regionally and globally by marketing our expertise in this area. Energy Consumption”
“I would therefore like to propose that the Government look at establishing Singapore as an Asian centre or hub for sustainable energy, as Singapore would then be in the position to (1) provide and promote solutions to mitigate climate change; (2) develop, engineer, fund, supply, install, commission and operate many renewable energy systems in Asia; (3) attract technology and R&D foreign talent to come to Singapore; (4) generate many more high-paying jobs for Singaporeans and facilitate the training of many from the region to operate and maintain these systems; and (5) develop Singapore into a major carbon trading centre for Asia. Sir, I would therefore like to ask the Minister two questions. First, will the Government take the lead in this new but very important sector for Singapore and the region to develop Singapore into a centre for sustainable energy, technology, R&D and carbon trading? Second, will the Government look at setting up a central agency to include the various Ministries that are already involved, in one way or another, in climate change or in energy efficiency to provide a one-stop shop? This is to attract renewable energy technology companies to Singapore, to attract energy and renewable energy project funding to Singapore and, obviously, attract the funds to come to Singapore. Third, will the Government provide clear guidelines and support for test-bedding, grit-feeding, allocation of sites for factories, tax incentives, etc, for these technologies? Fourth, to promote and develop markets for these companies and, finally, to develop a regional carbon trading centre. Sir, Dr Tony Tan and the National Research Foundation have said that the Government will put aside billions of dollars to spearhead R&D in water and environmental technology.”
“This unnatural pattern will adversely affect Singapore's food supply as well as its water supply. Finally, forest fires in our neighbouring countries will exacerbate because of droughts leading to more days of polluted air in Singapore, causing more respiratory illnesses and reducing our economic efficiency. These are not doomsday scenarios, but a phenomenon that Singapore has experienced over the last 12 months. With climate change and temperature increasing, this phenomenon is going to occur more regularly and with greater intensity. I know some would argue that we are a small city-state, a little red dot, and that, therefore, even if we have the most efficiently-run economy in terms of energy efficiency, and even if we have the lowest carbon emission per capita in the world, our contribution to the global carbon emission level will be miniscule. By taking such a viewpoint, Sir, it is unwise, as Singapore should be a responsible global citizen. Singapore must face up to its responsibilities as a developed First-World nation and take the lead in addressing climate change. Indeed, we have done so by rectifying the Kyoto Protocol. We therefore have to take steps to reduce our emissions of greenhouse gases and increase energy efficiency. We must therefore facilitate and encourage businesses to strive towards making Singapore a leader in the following four areas. (i) energy efficiency for all sectors, both commercial and industrial; (ii) technologies and systems for renewable energy; (iii) resources and funding for renewable energy systems for the whole East Asian region; and (iv) R&D in developing better, cheaper and more efficient renewable energy systems.”
“Sir, hardly a day goes by without some news reports on natural disasters, climate change and global warming and as mentioned by many Members of this House. From the Stein Report and, more lately, the IPPC Report or Intergovernmental Panel on Climate Change report, it is obvious that the world must act now to reduce carbon emissions or face the increasing fury of weather changes globally, eg, the highly destructive hurricane Katrina in New Orleans, and the recent tornadoes in the US, the floods in Asia caused by heavy and persistent rainfall, droughts in Australia and certain parts of China, etc. Of special concern to us, as a small low-lying island, as shared by many others in this House, is the melting of the ice in the polar caps and the resulting rise in sea levels. If the world does nothing to reduce carbon emissions or business-as-usual scenario, it is projected by the Stein report that by 2050, temperatures will increase some 2-3 degrees centigrade. And this will bring a 5-10% increase in the wind speeds of hurricanes, doubling the annual damage that they would cause in the USA. Heatwaves in Europe will kill more people and severe agricultural losses of over US$15 billion in 2003 will be commonplace and will affect many countries. Closer to home, Singapore was affected by, for example, rising sea levels and heavier floods, examples that were already raised by Ms Lee Bee Wah, because of heavier rains. Second, vector-borne diseases, like dengue and malaria, will become more widespread with the increase in temperature and unseasonal rainfall patterns. Third, declining crop yields either because of too much rain causing floods or too little rainfall causing droughts around the region.”
“What efforts are being made to ensure that as much as possible of the waste materials from these buildings are being recycled? Apart from bricks and concrete, what happens to the thousands of doors, windows, sinks, kitchens, cupboards, toilets, etc, which are part of the en bloc destruction of these buildings? What is MEWR, and possibly other Ministries, doing to recycle this waste, because if much of it cannot be incinerated or recycled, it will fill up Pulau Semakau even faster? Climate Change and Energy Efficiency”
“Thank you, Sir. I would like to support and expand on the concerns on this subject of waste management brought up by Mr Charles Chong and Mdm Cynthia Phua. Sir, the continuing problem being faced by Singapore must be the increase of waste caused by the increasing population and the construction of mega development projects, such as the two IRs and also many high-end condominiums which are targeted at high net worth foreign talent and foreign professionals. Looking at the latest recycling figures provided by NEA, the following waste categories are very much below the 2012 targets of SGP 2012 and will get worse, if not checked. Some examples are horticultural waste. The current recycling rate is 51%; 2012 target, 70%. Glass - current recycling rate, 5%; 2012 target, 50%. Food waste - current recycling rate is 7%; target 2012, 30%. How is the Ministry of the Environment and Water Resources addressing this projected increase in waste, especially when the Ministry of National Development is planning, in their Concept Plan, for a population of 6.5 million? Has MEWR allowed for this increase of Singapore's population and the larger than usual volume of waste generated with respect to a capacity of a landfill in Pulau Semakau? And, more importantly, what happens when Semakau is full in 35-40 years? Another question I would like to ask is with regard to the construction and demolition waste, which would be caused by the larger than expected waste generated because of the active en bloc sale market. Many of these buildings, which are sold en bloc, will generate many tonnes of construction and demolition waste, as each is destroyed and make way for new buildings. How much of this waste can be recycled?”
“Mr Chairman, may I request that I take both my cuts, one after the other?”
“Only then can we attract major global players in this industry to come to Singapore and, more importantly, to develop our own Singapore based EWI SMEs, and therefore to be a leader in sustainable development. Haze”
“Sir, Singapore has invested heavily in technology and R&D in the environment of water sector over the last 40 years to ensure we have a clean and sustainable environment. I do applaud MEWR and the Government for this long-sighted initiative. We will be spending even more in R&D in this sector over the next five years. And I believe the National Research Foundation has allocated $330 million this year for research on environment and water technology. May I ask the Minister whether there is a masterplan drawn up for R&D and technology development in this sector, and whether an Environment Water Ministry Technology Task Force was set up and whether the private sector was consulted to develop this masterplan? If there is such a masterplan, can the Minister share this with the industry? There are many sub-sectors in this large area of environment and water and Singapore cannot be taking the lead in all sub-sectors. It would therefore be good if Singapore, as a whole, both Government and private sector decide on what sectors should Singapore focus on, particularly because of our special constraints of limited space and high population density. Many technologies in developed economies like Europe and the US had been developed and become leaders worldwide because of government regulations in environmental laws. For example, Photo Voltage, or PV, for solar cells, Germany introduced feed-in tariff laws for renewables in year 2000. It is now the biggest market for PV in the world, making 25% to 30% of the world's markets for PV, creating 38,000 jobs in manufacturing and systems supply and over 1,000 jobs in R&D. Sir, if Singapore wants to be a leader in the EWI sector, we need to plan, strategise and take bold initiatives and decisions.”
“I do urge us to be fast to seize the opportunities I have just proposed. Madam, I support the motion. ADJOURNMENT OF DEBATE Resolved, That the debate be now adjourned. - [Mr Tharman Shanmugaratnam].”
“So I am not asking for tax holidays, better housing, etc, but a more global and general response in order to convince the rest of my family. Living in Hong Kong, we are already sick of the air pollution and the government's inability and lack of courage to deal with basic issues. Buses on clean bio-diesel scramble for our power plants, etc. Singapore has a great chance to differentiate itself on this point by showing courage and taking bold steps. Edwin, in short, I will bring my business to Singapore when your Government takes a lead role and bold steps on air pollution." This is one view from an investment banker. Madam, I would therefore conclude and suggest that the Second Minister for Finance and the Government consider setting up a central agency to facilitate and promote Singapore as this centre for sustainable energy. At the moment, although there is a combined committee from all Ministries looking into this sector, I would implore the Government to set up a central agency with some teeth to spearhead and to come up with policies that can help facilitate foreign SMEs who are funders or technology providers in this sector to start up in Singapore. The central agency should be able to facilitate and assist on all areas to do with incentives, test-bedding technologies, setting up of semi-commercial or full commercial renewable energy systems, feeding in policies on renewable energy to the grid, including perhaps mandatory percentage of renewable energy in utility mix, setting up of a sustainable energy fund with some base funding from the Government, etc. Madam, Singapore needs to act now before we lose the chance to build up a leadership position. As Mr Lim Swee Say has just quoted, Singapore is small, but we need to be fast to survive.”
“He said: "To move my company to Singapore includes a lot of change not only for me but also for my family, including change of social network, doctor, schools, favourite restaurants, shopping, etc. So there is a lot of inertia and challenges for the whole family built into such a move. Singapore has good schools, housing, healthcare, etc, but so has Hong Kong, Bangkok, etc, and the differences are well-known and have been discussed several times in both companies and families. To trigger a change would be a new factor such as environment and air pollution. And the trigger would be for Singapore to step up and take a leadership position amongst cities in Asia and globally in terms of addressing these issues. For example, if Singapore Government introduced not a 2% to 5% lending target by 2012, but something much bolder, such as 20% or 50% lending target by 2010, that will make headlines and profile Singapore to the general public and amongst corporates and families around Asia and globally. My son would then come running to me and say, "Now we need to move to Singapore there." Lee Kuan Yew recently made a statement that Singapore has reached the top group of countries and cities globally and now need to move from the bottom of that group to the top of the group. The way to achieve this is to do what countries like Germany and Scandinavian countries have done - make bold steps and be a leader in the environmental regulation and you will find that the feared negative impact on the economy is compensated by a whole set of new enterprises and jobs created from industries developed to deal with the new regulations, and being a leader globally means that these new industries become global leaders.”
“Many Members of this House have also spoken yesterday and today on the need for Singapore to be environmentally-sustainable and for Singapore to demonstrate how seriously we can take climate change. Madam, I support strongly the direction that all Ministers and my fellow MPs are taking and would like to especially applaud our Minister Mentor for being the great architect who has, as early as 1965, forged the clean and green agenda for Singapore. I would like, however, for Singapore to take one step further to not only be the cleanest and greenest city in the world, but also the most environmentally-sustainable city in the world. What this means is that, besides being aesthetically clean and green, we need to: (1) Be the most energy-efficient city in the world. (2) Have the most environmentally-friendly industries in the world. I would like to see all industries and manufacturers adopt ISO 14000 or an improved environmental management system or EMS programme. (3) Have the cleanest air in the world. Our Government may need to legislate on PM 2.5 and mandate the use of cleaner fuels and bio-fuels for our transport sector; and (4) Emit the lowest CO2 per capita in the world. Singapore can be a great model sustainable city, not only for Asia but the rest of the world, providing all solutions to assist our neighbours in the region to avert global warming and problems with climate change. I am confident that as a centre for sustainable energy, Singapore will achieve three of the four points that I have mentioned above and be a model city at the same time. Madam, I would like now to share with the House an email I received from an investment banker based in Hong Kong. I asked him a very simple question: how can Singapore attract you to come here?”
“The fact that a number of leading foreign solar companies like Conergy, Solar World, Solar Fabric and, more recently, Phoenix Solar have based their Asian HQ in Singapore should be a strong signal that Singapore has all the pre-requisites to attract these companies to come here. I am of the opinion that Singapore can do more so that we can take the momentum already generated by these major companies on solar energy to extend this to other technology providers in a sustainable energy sector, for example, wind, bio-mass, bio-gas, thermal, geothermal, fuel cells, bio-fuel, hydro, wave, river current, etc. The Minister has identified an alternative energy market size of US$300 billion by 2015. And I dare say that most of these is in Asia alone as 80% of the world's alternative energy projects are projected to be in Asia. Madam, I would like now to refer the House to my second diagram which will help illustrate the tremendous value chain associated with this business which will include project financing, project development, project engineering and management, technology providers, clothing manufacturers and suppliers of systems, energy service companies or ESCOs, R&D and carbon or emission trading. Each of these areas of specialisation will bring foreign talent and will develop local talent at all levels. Madam, the Second Minister for Finance and also our Minister Mentor, Prime Minister and the Minister for National Development in the media, have all painted a picture of a cleaner and greener Singapore. We must have a living environment that is the "best" in Asia. We will make Singapore a city of "Gardens and Waters", a city of "Green and Blue".”
“Madam, what is missing from my presentation above is money or funds to help the SMEs start up or expand. I know a number of my colleagues in this House, including Mr Inderjit Singh, had brought up the subject of an SME bank. I would like to request that the Minister considers this issue seriously as even with the best plans by SMA and even with Spring, to encourage the start-up and growth of SMEs, if money not enough, then Singapore will have "SMEs no enough." Perhaps Jack Neo can produce a sequel of his "no enough" movies to show that SMEs can start up and grow in Singapore. Many of our commercial banks in Singapore provide loans based on commercial terms and standard commercial risks which do not factor in the higher risk profile of start-ups or low-asset profile of these SME start-ups. These SMEs, looking to start up or grow, will therefore not meet the collateral requirements of these banks. Madam, my last topic is sustainable energy and how Singapore can grow SMEs in this sector, making Singapore a de facto centre of excellence for the whole value chain of this new but highly scaleable business. I am heartened that the Minister did mention alternative energy in his Budget Statement and that Singapore will seek to participate in this emerging industry. May I strongly suggest to the Minister that Singapore is currently in the best position to develop into an Asian centre for sustainable energy or alternative energy or clean energy which all mean nearly the same thing except that sustainable energy also includes energy efficiency. Except for Japan and Korea, there are no structured programmes in any country in East Asia similar to the strategy I am proposing for Singapore to take the regional leadership position in this sector.”
“SMA has already signed an MOU with the National Association of Manufacturers (NAM) in the US, and is in the process of doing likewise with the other developed economies. Each of the local embassies of these six DEs identified by SMA is working very closely with SMA. (3) Providing technical training in SMA's workforce to the levels and standards expected of these developed economy SMEs. SMA is working closely with WDA to extend SMA's already successful training centre, where upgrading of skills training is provided to all workers in the manufacturing sector, into a manufacturing institute. This manufacturing institute will look at adopting course curriculum and standards currently used to qualify the workers required by all manufacturers, including the SMEs in these developed economies. The manufacturing institute will also be introducing WSQ qualifications for the manufacturing sector currently being designed by WDA. This will be another pull factor for these SME manufacturers to choose Singapore, as they know the qualification of our workers will meet their standards. Finally, tapping markets globally for SMEs. The six MOUs with manufacturing associations in the developed economies will represent market opportunities. SMA has also established relationships with many manufacturing associations in regional countries like China, India, Malaysia, Thailand, etc, and helping countries like Vietnam establish their own manufacturing associations. SMA will continue to work closely with IE Singapore and also with many of our members who have established manufacturing presence all over the world, including new frontiers like Russia, Kazakhstan and the Middle East, to ensure markets in these countries are open to our Singapore manufacturers.”
“Madam, may I now share with the House what the Singapore Manufacturers' Association is planning in the next two to three years to grow manufacturing in SMEs, both foreign and local, in Singapore. Helping local entrepreneurs source for commercialisable IP. The CEO of Nestle who serves on the ExCo in SMA as a Vice President is chairing SMA's SME Development Function Committee. Nestle has a number of IPs that are commercialisable but it is not within their core business strategy to do so. However, they are prepared to allow an entrepreneur to do so. We know of a few other MNCs in the manufacturing sector which are also prepared to allow their IPs to be commercialised by third parties. The Enterprise Development Centre (EDC) at SMA will work with Nestle and the SME Development Function Committee to find suitable entrepreneurs. Good IP is very often a major consideration for start-ups. The other major consideration is money. I will elaborate on this later. Attracting niche manufacturing SMEs from developed economies (DEs) to come to Singapore. SMA is doing this in a number of ways: (1) SMA is leading missions of local manufacturing SMEs to countries like the USA, Germany, Switzerland, Austria, Japan and Australia. These missions will allow our SMEs to visit their counterparts in these developed economies where SME manufacturers are the backbone of their economy and employ a large percentage of their workforce. It is hoped that this first contact will attract return missions from these developed economy SMEs and for these foreign SMEs to finally decide to come to Singapore. (2) It is establishing official link-ups with these developed economy manufacturing associations.”
“More importantly, if we are successful in growing this sector, it will mean many jobs being created, including jobs for the PMETs and our mature workers, as each manufacturing SME will require a wide range of technical skills on the manufacturing or production floor, and also managerial skills, including marketing, branding, process management, human resource management, customer relationship management, finance, IP/technology management, etc. In most cases, R&D and its management will be required only after successful start-up of the manufacturing process. From the chart, we will see that in many branches of the six elements, both Government and the private sector need to work hand in hand. The incentives provided by the Second Minister for Finance on tax exemption thresholds and reduction of corporate tax will go a long way to help SMEs grow. But they do little to attract SMEs and start-ups to Singapore, as these tax benefits apply only for chargeable income when the SME becomes profitable. Madam, I am however encouraged and very optimistic about the Minister's intentions to make Singapore the best location for SMEs, local and foreign, to start, grow and globalise, and that he will continue to tweak the incentives to make it a no-brainer for foreign manufacturing SMEs from niche technologies, a sound business model and interested in the large East Asian market to look at setting up in Singapore. After all, in Singapore, we already have strong IP laws, a highly skilled workforce who are disciplined and speak good English, plus we have good infrastructure, good living environment, stable Government, excellent healthcare services, educational institutions, R&D facilities, etc, all positive factors to make Singapore an attractive investment destination.”
“Before I begin to discuss on this subject, I would like to declare my interest as the CEO and Managing Director of IUT Global Pte Ltd, a SME in the environment business generating renewable energy and biocompost from food waste. IUT Global can therefore be considered a manufacturer and in the sustainable energy sector. However, the comments I will be presenting on manufacturing and sustainable energy are made on the strengths of the two hats I wear as President of the Singapore Manufacturers' Association (SMA) and the Chairman of the Sustainable Energy Association of Singapore (SEAS). Madam, I would like the House now to refer to a diagram called Growing SME Manufacturing that I have circulated (copies of diagram distributed to hon. Members). As seen from this diagram, for the manufacturing SME to be successful, it needs six elements, namely, IP/technology; money; markets; well-trained management, particularly the CEO and his senior managers; well-trained and highly-skilled workers; and research and development, which is optional, depending on the technology applied by the SME. I have focused on the manufacturing SME because this is an area of SME development which I feel needs more support as it has the greatest potential to grow and succeed because of Singapore's manufacturing roots and the Singapore brand of manufactured products is well accepted today on a global basis.”
“Many SME bosses feel that they need to attend together with their accountant as they are required to sign forms committing them to administer the GST, but they need to understand the requirements of what they will be committing to, in case their accountant leaves them. There are three or four other issues regarding investment and capital allowances that I feel are not really related to the 2007 Budget Statement which I will bring up at other sittings. However, Madam, I have one last issue regarding personal income tax. Many questioned why this was not addressed in line with the reduction of corporate tax, particularly when Singapore wants to attract highly qualified foreign talents to come to Singapore. A reduction in personal income tax will further reinforce the key reasons for these talents to seriously consider Singapore and it will be on top of the advantages the Minister has mentioned in relation to why globalisation is working in Singapore's favour. I am glad that the Minister does recognise that even though Singapore's personal tax rates are competitive, there are some other jurisdictions with lower effective tax rates compared to Singapore. I, therefore, encourage the Minister to consider lowering our personal income tax rates to attract and keep both international and Singaporean talents in Singapore. Madam, I would like now to change gears and move on to another topic on the Budget Statement which I am passionate about. I am referring to the growing of SMEs and, in particular, SMEs in manufacturing and the sector on sustainable energy.”
“From the size standards chart of the US Small Business Administration, it looks like they define a SME as an enterprise either employing no more than 1,500 people or have a turnover of not more than US$28.5 million or approximately S$43 million, depending on the sector, type of industry and size standards of the industry. For manufacturing, the size standard, for example, is based on the maximum of 500 employees. So it looks like that the definition of a SME in the US depends on which size standard is being applied, ie, turnover or employee size. Singapore needs to look at these major economic blocs and decide on which model we should follow or come up with our own hybrid, but a revised and updated definition is overdue, if we want to encourage foreign SMEs to come to Singapore and also Singapore SMEs to grow and to be on par with their foreign counterparts. With the pro-SME Budget and incentives, I can see many Singapore SMEs being encouraged to explore joint ventures with European or US SMEs and vice versa. I will elaborate later on on how I see this SME base growing, particularly in the manufacturing sector. GST The sectors I represent seem comfortable with the one-step 2% increase in GST and the effective date of 1st July 2007. A number, however, requested that the 50% grant to support GST registration related costs be processed speedily by the Government agencies, such as Spring, to help them on their cash flow. There was also a request that the quota be increased to two representatives for GST registration related training courses organised by IRAS which, I believe, are free.”
“Corporate tax It was suggested, to be consistent with the previous exemption ratio for corporate tax, that the Government should consider raising the 75% exemption level to the first $30,000 of chargeable income instead of $10,000. The balance of $270,000 should then be at 50% exemption for year of assessment 2008. Early enactment of Budget It was suggested that the Government look at enacting the Budget within six months of adoption, as this would be helpful to the business community in terms of obtaining clarity on specific changes. The Income Tax Act 2007, for example, was gazetted on 13th February 2007, ie, almost one year after the 2006 Budget was passed. Definition and classification as SMEs It was suggested that the Government review the definition of SMEs, as currently companies with fixed assets of greater than S$15 million and employing more than 200 people do not qualify as SMEs. In view of the Government's focus to grow SMEs and encourage SME start-ups, I would suggest that the Government look at redefining Singapore's definition of SMEs to align with more developed countries, if we want to attract these foreign SMEs to come to Singapore. For example, the EU definition of a SME is an enterprise which employs fewer than 250 people and which has an annual turnover of less than 50 million Euros or approximately S$100 million and have a listed company that controls less than 25% of voting rights. There are, of course, sub-divisions or categories of what is a small enterprise and what is a micro enterprise. The Americans, on the other hand, have detailed definitions of what enterprises can qualify to be a small business. They use a table of size standards which vary based on the industry sector the enterprise is in.”
“Mdm Deputy Speaker, may I first be allowed to wish all Members of this House and their families a very joyous and a successful Lunar New Year. Next, Madam, I would like to applaud the Second Minister for Finance for presenting what has been hailed by the business and manufacturing sectors as a pro-business and pro-SME budget. And I believe, like the Minister, that this Budget will indeed help businesses and Singaporeans grow the economic pie and ensure the sustainable growth of Singapore over the next five to 10 years and beyond, taking advantage of globalisation. More importantly, all are convinced that this is a serious Budget with long-term goals and strategies, compared to the stigma of last year's Budget which many touted as an election year Budget. Madam, I would like now to share with the House my findings from two feedback sessions organised last Thursday, 22nd and 23rd February with the Manufacturers Federation and the Singapore Business Federation. I would say the response from the manufacturers to attend the feedback sessions was quite poor. So it was postponed because the Lunar New Year holidays were more important to them than the Budget. But take it as a good sign. It shows that the manufacturers in Singapore are happy with the Budget and the handful of written feedback SMA received indicated minor discomfort similar to feedback I received from approximately 100 companies and business representatives, mostly SMEs, who turned up at the SBF's conference room on Friday. The SBF Secretariat staff and myself spent two hours listening and discussing about the Budget, after assessing from the outset that all present were generally happy with the Budget. Madam, please allow me now to summarise the issues raised.”