Gan Kim Yong
Singapore
“Consumer complaints relating to the secondary resale market for tickets to major events and concerts have generally remained low. Nonetheless, to protect the public from scams on secondary ticket resale platforms, the Police have imposed Code of Practice requirements under the Online Criminal Harms Act to require designated online service…”
“Singapore does not condone the use of forced labour. We criminalise forced labour in Singapore under various laws. Relevant Government Ministries and agencies, such as the Ministry of Manpower, Ministry of Home Affairs and Singapore Police Force, play their part in investigating complaints of suspected breaches in domestic laws that relat…”
“The Association of Banks in Singapore (ABS) discontinued the PayNow nickname feature as scammers had been exploiting the use of nicknames to impersonate legitimate entities and trusted individuals.”
“As of end-2025, around 6,900 private residential buildings have registered their solar installations with SP Group for the export of excess solar-generated electricity to the grid. The installed solar capacity of these residential buildings is 115.3 megawatt-peak (MWp), or around 5.5% of all current installed solar capacity in Singapore.”
“The one-year pilot extension of liquor trading hours has seen strong interest from businesses. As of 31 May 2026, the Police have approved 88 applications for the extension of liquor trading hours from public entertainment outlets in these areas.”
“The Government does not make projections of domestic or regional demand for renewable diesel or sustainable aviation fuel. Demand depends on commercial considerations, evolving market conditions and regulatory developments across different jurisdictions.”
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“PMETs whose skills are highly specialised will paradoxically need to be more mobile and adaptable so that they are less vulnerable. To address PMETs' needs, the Government has already increased the number of subsidised PMET courses available. Some MPs, like Mrs Josephine Teo, asked whether the Government will do more to help Singaporeans stay ahead. We will introduce a new comprehensive programme for PMETs, the Skills Training for Excellence Programme (STEP) to provide a sharper focus for our efforts to help PMETs. The aims of STEP are four fold: first, STEP will allow PMETs to deepen their industry and occupational-specific knowledge and skills so that they can be more proficient in their jobs. Second, STEP will allow PMETs to broaden their skills through developing relevant horizontal skill sets such as human resource, marketing, management and finance. Third, there will be courses for PMETs to refresh their skills and update their knowledge to stay abreast with the new trends and developments in their sectors. Lastly, STEP will develop a talent and leadership core for key industries through scholarships and customised training roadmaps for PMETs in the various sectors. The Government will invest $150 million over the next three years under STEP. Many of our training programmes are delivered through small bite-sized modules to meet the needs of working PMETs. Nevertheless, attaining a full qualification, through the completion of a requisite set of modules, gives trainees a more comprehensive repertoire of skills. Therefore, we will introduce a CET Qualification Award (CQA) to encourage workers to complete a full qualification. This will also help PMETs to finance the costs of their training.”
“Third, we will raise the quality of our CET institutions by developing the capabilities of local CET providers, as well as bringing in international best-in-class institutions so that they are innovative and responsive to the needs of the industries and adult learners. We will also be developing two national CET campuses as catalysts for the development of the CET industry. My Minister of State will talk more about the two campuses later. Fourth, we will enhance the quality of our CET professionals by raising the bar so that we can deliver high quality CET programmes effectively. To achieve this vision, the Government will continue to leverage on our tripartite partners to reach out to our employers, workers and unions. Last year, we announced that we are investing $2.5 billion in CET over five years, in support of this vision and also to ensure that CET remains affordable and accessible to all Singaporeans. Sir, the pursuit of our CET vision is an ongoing journey. My immediate task this year will focus on three key thrusts. I will describe our broad policy rationale, and the Minister of State and Senior Parliamentary Secretary will elaborate on the details. For our first key thrust, we will provide greater training support for PMETs. Our CET system has traditionally provided strong support for our rank-and-file workers. We will continue to do so, but we need to expand and increase our attention on PMETs as they now form 52% of our local workforce. PMETs are key drivers of value creation in enterprises. They are highly skilled and extremely proficient in their current jobs. But as Mrs Josephine Teo rightly pointed out, when the global economy becomes more dynamic and volatile, the pace of economic restructuring will become faster and skills will become obsolete sooner.”
“We are in the initial stages of implementation and at the appropriate time, the Council will provide an update on the beneficiaries and the impact of the fund. And I would like to also point out that productivity improvement involves everyone – local workers, foreign workers, all have to upgrade. Local companies, foreign companies, SMEs and multinationals all have to be part of this effort to raise productivity. And I hope Mr Low will understand and not just ask the local workers to make the effort to upgrade, and not the foreign workers. So productivity involves everyone. One of the core strategies of NPCEC is to develop a first-class Continuing Education and Training (CET) system. Sir, let me share my Ministry's vision for the CET with the House. Our vision is to nurture a culture of lifelong learning among our workforce and our enterprises: companies eager to acquire new capabilities, integrating CET as part of their business strategy and rewarding their workers for better skills and higher productivity; workers, on the other hand, are always seeking to constantly improving themselves, learning new skills, keeping abreast of the latest knowledge and taking personal responsibility for their own upgrading. We see CET developing into a major competitive advantage for our economy and our workforce. To do this, we will build our CET system on four fronts. First, we will develop high quality and relevant training programmes – relevant not just to today's skill needs but also future-oriented and outcome-based. Second, we will improve on the accessibility of these programmes and build more CET pathways and linkages so that workers from all levels, from all sectors, will have access to good quality CET programmes.”
“Employers of existing EP and S Pass holders will be given a one-time renewal of up to two years to meet the salary thresholds. Further renewals thereafter will be subjected to the new salary criteria. Existing EP and S Pass holders who cannot meet the new salary threshold may also apply for lower pass types, if they are eligible. I would like to also add that we cannot close our doors to foreign talent. Foreign talent continues to be critical for our economic growth. These talents will help to grow the economic pie, so that everyone will have a bigger pie to share. Otherwise, we will lose our attractiveness as an investment destination and we will not be able to create good jobs for our locals. Let me assure Mr Liang that what we will do is to tilt the balance in favour of our local PMETs, by helping them upgrade and become more productive. For this, we will roll out a comprehensive programme for the local PMETs, which I will talk about in the next segment. Sir, moderating foreign labour demand alone will not raise productivity. We will need a second strategy of skills training and upgrading. DPM Teo Chee Hean has already provided an update on the progress of National Productivity and Continuing Education Council (NPCEC). Mr Low Thia Khiang has asked about the beneficiaries of the progress of the National Productivity Fund. As DPM Teo had already elaborated earlier, the NPCEC has endorsed the sectoral blueprints for seven out of their 12 priority sectors and allocated half of the first $1 billion. The various champion agencies are in the process of finalising their roadmaps. The funds will be progressively utilised as these plans are being rolled out. Mr Low will understand that productivity is a long journey.”
“The company needs to have the requisite number of full-time local workers under our Dependency Ratio framework to qualify for foreign workers. To ensure that local workers are employed meaningfully, rather than being employed on a token salary just to allow the employer access to foreign workers, we adopt a threshold salary of $650 today, below which local workers are deemed to be working part-time. And employers will need two such part-time workers to be counted as one full-time worker. Given the increases in locals' wages, we will increase the threshold salary from $650 to $850. This will take effect from July this year. Mr Liang Eng Hwa was concerned about Employment Pass (EP) holders competing with local Professionals, Managers, Executives and Technicians (PMETs). The strong economic growth last year had added to the strong demand for PMETs. This means that there are many opportunities for local PMETs and this includes occupations in the Strategic and Skills-in-Demand List which Mr Liang has mentioned. These jobs are available to locals as well and we will encourage locals to consider taking up these jobs. Given the tight labour market for PMETs, salaries of local PMETs have also moved up in recent years. We need to raise the qualifying salary thresholds for EP and S Pass applicants accordingly, to keep pace with the local PMETs labour market and to encourage companies to be more selective in hiring foreign talent who can contribute to our economy. Therefore, from 1st July 2011, to qualify for S Pass, applicants' monthly salaries will have to be $2,000 or more, up from $1,800. Similarly, the qualifying salary thresholds for Q1, P2 and P1 Passes will be raised to $2,800, $4,000 and $8,000 respectively.”
“We should not underestimate the potential of every business to improve and upgrade. Ms Jessica Tan has asked for examples of businesses which managed to do this. Let me give Members an example from the F&B industry. Some F&B employers said that they have no choice but to pass the increased costs onto their customers. Well, we can understand that F&B outlets have to maintain a certain level of personal service and interaction with customers and this cannot be done by robots. There is still much scope for productivity improvements, especially at the back end. Some of you may have read about Minister Lim Swee Say's visit to Ruyi restaurant, where he saw an automatic wok frying rice. Some may think that this is just a showpiece and not for real. Well, Ruyi is not alone. Let me show Members this particular slide [as shown on the screen ]. Like Ruyi, Lerk Thai, a restaurant which serves Thai cuisine, similarly uses automatic frying woks, and not just woks, automatic boilers as well and deep fryers in its kitchen, and it has also standardised its work flow. All this innovation will save Lerk Thai 20%-30% in manpower costs. Also, now that food can be served faster, Lerk Thai's table turnaround time is shorter and sales have increased by an estimated 20%-30%. The chef also has more time to create new menus. The food prepared is also of higher consistency. Now, this is what every business should be aiming to do. Sir, in conjunction with levy increases, my Ministry will also be making administrative refinements so that the companies' monthly levy bill will be more reflective and responsive to changes in its workforce profile. We have also reviewed the various salary benchmarks in the Work Pass framework. This is necessary, given that local salaries have increased over time.”
“Ms Jessica Tan asked whether companies will still be able to capture growth opportunities in the current tight labour market. The answer is definitely "yes" but provided they make sustained efforts to raise productivity. As Ms Jessica Tan pointed out, there will be no change in the Dependency Ratio Ceilings. Companies that require foreign workers to grow and capture new opportunities will continue to be able to hire them as long as they are able to remain competitive with the higher levy rates and have the requisite number of local workers. Sir, the levy increases will be spaced out until 2013 but I urge companies to push immediately towards innovation and productivity to reap maximum benefits. The impact of all the impending levy increases will be about 1.7% of total labour cost when they are fully implemented in 2013. If businesses tap on the funding from the various Government schemes to embark on productivity improvements and save on foreign manpower, the cost impact will be significantly lower. Let me illustrate. *Cols. 4525-4526. The average levy increase for a services Work Permit holder is about $260. If a company improves its productivity and hires just one fewer Work Permit holder, the savings in wages, levy, accommodation and other costs from this one worker will more than offset the levy increases for the other four to five other Work Permit holders in its employment. This excludes the additional funding that the company may get from the Productivity and Innovation Credit and the National Productivity Fund. This applies similarly to a company with S Pass holders. 3.30 pm Some have said that their businesses and challenges are different and it is not possible to improve productivity further.”
“Even countries which are behind us today in terms of productivity, those in our rear view mirrors, they are on motorbikes but they can weave in and out, they are very nimble and they will catch up with us over time. We must, therefore, push ahead with our efforts to reduce reliance on foreign manpower and create the necessary impetus for employers to turn to productivity improvement instead. Secondly, it is better for us to do this when the economy is growing strongly and when companies are in a stronger position to make the necessary adjustments rather than to do so in a recession when companies are facing more challenges. Let me turn to S Pass. The levy for S Pass will be increased quite significantly by between $190 and $300. This is necessary because the S Pass stock has more than doubled since 2007. This growth rate is clearly not sustainable. S Pass holders are mid-skilled and they form part of the overall foreign manpower landscape. Therefore, we will also need to moderate the demand for S Pass holders to avoid an over dependence on S Pass workers. I agree with Mr Yeo Guat Kwang and Ms Jessica Tan that we need better skilled workers. Our work pass framework is, in fact, designed to encourage employers to hire skilled workers. Employers will pay lower levies if they hire Work Permit holders who possess recognised trade tests relevant to their occupations or industries, including those from the Institute of Technical Education as well as from the Singapore Workforce Skills Qualifications (WSQ) system, as suggested by Mr Yeo. We have also recalibrated the S Pass entry criteria earlier so that only better qualified foreign workers will be eligible for S Pass.”
“The productivity of our services sector is about 75% of that of Hong Kong and about half that of the US and Japan. In the retail industry, for example, the value-add per worker in Singapore is only S$37,000 compared with S$56,000 and S$84,000 in Hong Kong and New York. This means that with the same number of workers, retail companies in Hong Kong are producing 50% more than Singapore companies, while those in New York produce more than double as much as us. This gives us a sense of how much productivity improvement is possible. But as Madam Halimah pointed out, this is not just about getting our retail workers to work harder and work longer. It is about how we can generate more revenue, create more value-add, how we can bring in more customers into our retail outlets, how we can streamline their workflow to be more efficient and reduce wastage of manpower resources. Some have asked why we are raising the levy so soon after the last round of adjustments. We need to make these painful adjustments now rather than later. There are several reasons. First, we must realise that the rest of the world will not wait for us. Some of us have watched the reality show called "Amazing Race" and in this show, there are teams of competitors racing to the final destination in order to receive a big prize. We are like one of the teams being stuck in the traffic in a taxi. While ahead of us, we are seeing some of the other teams racing ahead on an MRT train. And in our rear view mirror, we are seeing another team behind us on their motorbikes weaving in and out of traffic getting closer and closer to us. So, what do we do? If we do not catch up quickly on productivity, the gap with our competitors, the team ahead of us, will widen and we will lose our competitiveness over time.”
“The economic outlook for 2011 remains positive and we expect to see a stable labour market and healthy employment growth, especially in the services sector. With robust economic growth and a tight labour market, there is even greater urgency for us to raise productivity. We must step up our efforts on skills training and innovation while, at the same time, further moderate demand for foreign workers. Let me first elaborate on moderating demand for foreign workers. Sir, the strong economic growth last year had spurred the demand for foreign workers and about 53,000 foreigners were added to our workforce. While we need foreign workers to complement and supplement our local workforce, we have to further moderate their demand if we want to keep the foreign share of the total workforce to around one-third in the long term and encourage our employers to invest in productivity. As the Finance Minister announced earlier, my Ministry will further increase foreign worker levies in six-monthly intervals up to July 2013. The schedule has been released earlier and I will not go into the details. I would like to stress that the foreign worker levy changes should not be taken in isolation. They are part of the package of measures and initiatives introduced by the Government to encourage companies to embark on productivity efforts. Let me highlight a few issues relating to levy changes. First, we will increase the levies for Work Permit holders (WPHs) in all sectors but the increases for the services and construction sectors will be more significant. This is because there is greater scope for productivity improvements in these two sectors. Senior Minister of State Grace Fu already talked about the construction sector. Let me just touch on the services sector.”
“Mr Chairman, Sir, when I made this speech last year, we were just coming off one of the worst global recessions which we had ever seen and there were significant uncertainties then. However, 2010 turned out to be a good year for the labour market. Overall employment increased by 3.8% as 112,500 jobs were added, with about half going to locals. Consequently, the proportion of residents aged 25 to 64 in employment reached a new high of 77.1% from 75.8% in the previous year. In a nutshell, more Singaporeans are employed today than ever before. Our employment rate for older residents aged 55 to 64 also rose to a new high of 59.0% in 2010, after holding steady at 57.2% over the last two years. Overall unemployment rate improved to 2.2%, as compared to 3.0% in 2009. This chart* [as shown on the screen] shows that our unemployment rate is significantly lower than regions like the US and EU, which suffer from unemployment rates of more than 9%. It is also lower than Asian countries such as China and Japan which posted unemployment rates of over 4%. Our ability to bounce back from the recession so quickly was more than just sheer luck. It was because we implemented the right policies and tripartite partners worked together to save jobs and prepare for the recovery. The Skills Programme for Upgrading and Resilience (SPUR), introduced in December 2008, played a key role. The Government invested a total of $635 million on SPUR to benefit 334,000 workers. More than 80,000 job seekers found jobs through SPUR. Madam Halimah will be pleased to know that training efforts have not slackened despite strong economic recovery. Our training participation rate improved to 29% in 2010 from 27.9% a year ago.”
“Mr Hri Kumar Nair asked the Minister for the Environment and Water Resources how his Ministry determines the market rent for hawker stalls and what accounts for the disparity in market rents between stalls in different locations. The Minister for the Environment and Water Resources (Assoc. Prof. Dr Yaacob Ibrahim): Mr Speaker, Sir, the NEA engages a professional valuer to assess the market rent for non-subsidised hawker stalls in markets and hawker centres. Other than the prevailing economic conditions and size of the stall, the valuer will also consider the location of the centre as well as factors such as the accessibility and frontage of the stall within the centre when assessing the market rent for the stalls.”
“Sir, upon reaching age 55, and before he reaches his draw-down age currently set at 62, a member is already allowed to withdraw his CPF savings in the Ordinary Account and Special Account after setting aside both the Minimum Sum and the Medisave required amount. Medisave Account savings above the Medisave Minimum Sum can also be withdrawn upon turning 55. The CPF Act also provides for the early withdrawal of CPF savings in four specific situations. Firstly, for members who are terminally ill; secondly, for members with medical conditions rendering them permanently unfit for any employment; thirdly, for members with severely impaired life expectancies, and lastly, for members lacking mental capacity. The application for withdrawal under each of these situations would have to be certified by CPF Board’s panel of doctors and approved by the Board. Members who are certified by the doctors as terminally ill will be allowed to withdraw all their Ordinary and Special Account savings without setting aside the Minimum Sum. As such members are likely to require their Medisave savings for medical expenses, they are required to retain their savings in the Medisave Account up to the Medisave Minimum Sum, but any excess may be withdrawn. In the other cases, the member concerned will be allowed to make a lump-sum withdrawal from his Ordinary and Special Account savings after setting aside a reduced Minimum Sum and topping up his Medisave Account, up to the Medisave Minimum Sum. Medisave savings above the Medisave Minimum Sum can also be withdrawn as a lump sum. RENTAL RATES FOR HAWKER STALLS 4.”
“Sir, I agree with the Member that we can do more in publicising and educating our CPF members on the various top-up opportunities and the benefits of topping up their accounts. CPF has been doing so with our community organisations. We are reaching out to CPF members through grassroots and community leaders, through our programmes and through our workshops, seminars and roadshows to explain to members how they can make top-ups, why they ought to make top-ups when they can and how the top-ups will benefit them. We will continue to do more of those. CPF WITHDRAWAL BEFORE RETIREMENT AGE 3. Mr Viswa Sadasivan asked the Minister for Manpower whether the CPF Act provides for extenuating circumstances, other than for housing and investment, whereby a member is allowed to draw his CPF monies before his official retirement age.”
“For example, we have raised the top-up limit, increased tax relief for givers, and expanded the list of eligible recipients. As a result of the relaxation of topping-up rules and CPF Board’s promotional efforts, the number and amount of top-ups have increased almost five folds over the last five years. In 2010, there were 30,000 top-up transactions totaling $250 million. We will continue to encourage members to top up their CPF savings to better provide for their retirement and healthcare.”
“Sir, the CPF system not only provides for the retirement needs but also the housing and healthcare needs of its members. If we include property pledge, for the cohort who turned 55 in 2010, over 40% of active CPF members attained their cohort Minimum Sum set at $123,000 even after lump sum withdrawal at 55. This is an improvement over the 37% attained in 2009 which had a lower Minimum Sum requirement then. The cash savings in the Ordinary and Special Accounts which contribute towards the Minimum Sum-attainment represent only part of members’ retirement savings, as almost half of CPF savings are invested in housing. Adding back sums withdrawn for housing, the average savings of active members who turned 55 in 2010 will be $226,000, excluding balances in the Medisave Account. Correspondingly, if Ordinary Account monies were not used for housing, the Minimum Sum-attainment would have been about 60% for active members who turned 55 in 2010. The use of CPF for housing has helped nine in 10 Singaporeans own their own homes — an important and valuable asset that contributes towards retirement adequacy as members have various options to monetise their housing asset and to generate more retirement income if necessary. In addition, the CPF also helps members save for medical needs in their old age through Medisave which has an average balance of $28,000 for active members who turned 55 in 2010. This is also an improvement over 2009, despite liberalising the usage of Medisave over the years. The CPF has served Singaporeans well. To allow members to save more in their CPF, we have been steadily opening up the Minimum Sum Topping Up Scheme in recent years to encourage retirement savings.”
“We envisage that a Data Protection Council will be set up subsequently to oversee the implementation of the legislation. APPENDICES”
“A preliminary check with the Supreme and Subordinate Courts have revealed that, since the Act came into effect on 15th June 2007, no one has yet brought a civil suit to the Courts in relation to spam. The House was previously informed that a study was underway to review the need for a data protection regime in Singapore and to develop a model that can best address consumers’ concerns, business requirements and national interests. The review has been completed. The Government has concluded that it would be in Singapore’s overall interests to put in place a data protection regime in order to protect individuals’ personal data against unauthorised use and disclosure for profit. The Government will be introducing a data protection law that will provide a baseline standard for data protection in Singapore. The proposed law is intended to curb excessive and unnecessary collection of individuals’ personal data by businesses, and include requirements such as obtaining the consent of individuals to disclose their personal information. It will also enhance Singapore’s overall competitiveness and strengthen our position as a trusted hub for businesses and a choice location for global data management and processing services. Given that data protection is a multi-faceted issue that affects many stakeholders, we will need to undertake further consultation and work closely with the relevant stakeholders in the public, private and people sectors to address their concerns. In this regard, I have tasked the Infocomm Development Authority to coordinate this effort. The proposed legislation is expected to be introduced for consideration by Parliament in early 2012.”
“Er Lee Bee Wah asked the Minister for Information, Communications and the Arts in view of reports of offers to sell personal and contact information of key officers in various Government Ministries (a) how many companies are engaged in this business of data-mining; (b) what are the steps taken to develop the data protection model that can best address privacy concerns, commercial requirements and national interest; and (c) how many companies or individuals have been booked for unsolicited spam mails in 2009 and 2010 under the Spam Control Act. RAdm [NS] Lui Tuck Yew: The question posed by the Member relates to connected issues on data mining, spam and data protection. Data mining is the process of extracting and identifying patterns from data. Though it is more commonly used in marketing for customer relationship management, data mining is also widely used by businesses, organisations and individuals as a part of research, trend analysis and other legitimate profiling purposes. Given the pervasive usage of data mining as a business tool, data mining activities are not classified as a standalone category in the Singapore Standard Industrial Classification (SSIC). There are therefore no reliable statistics on the number of businesses engaged in such activities. The Member also asked how many companies or individuals have been charged for sending unsolicited electronic messages in 2009 and 2010 under the Spam Control Act. The Spam Control Act currently employs a civil-based regime for enforcement. This means that any aggrieved party can sue the sender in Court for an injunction, statutory damages, or actual monetary damages suffered. Due to the civil nature of the remedies, enforcement under the Spam Control Act does not involve a Government Ministry or statutory body.”
“On the barriers faced by SMEs in hiring Singaporeans, SMEs on the whole could face greater difficulties in attracting and retaining quality staff compared to larger companies due to weaker employer branding, lower ability to pay and reward as generously, and fewer opportunities for job rotation. In 2010, SPRING rolled out two programmes to encourage young Singaporeans to consider SMEs as an attractive career choice. The Management Associate Partnership is an 18-month career development programme that equips management associates with core competencies to run SMEs’ operations and be part of the SME’s future growth stories; the Enterprise Internship Programme seeks to expose local university and polytechnic students to the dynamic and rewarding working environment in high-growth SMEs through short-term internships. In addition, SMEs may also tap on Government assistance programmes such as the HR Capability Programme under SPRING Singapore to enhance their HR capabilities and practices. Being small, SMEs also have their advantages, such as greater ease in creating a close-knit organisation, wider range of responsibility for their managers, more flexible HR practices, etc. We encourage our SMEs to leverage on their strengths and adopt progressive employment practices to win their share of talent to support their growth. ENHANCED DATA PROTECTION AFTER RECENT REPORTS OF SALE OF PERSONAL INFORMATION 11.”
“Training barriers commonly cited by small and medium-sized enterprises (SMEs) include financial constraints and difficulties in releasing workers due to small staff strength. Nonetheless, MOM’s survey of private sector establishments showed that 61% of SMEs, defined as establishments with less than 200 employees, do send their workers for structured training. This is comparable to the figure of 65% among all private sector establishments surveyed. Among SMEs who sent their workers for training, many reported positive impact of training, such as higher work productivity and customer satisfaction. Continuing Education and Training (CET) is subsidised for all Singaporeans. To make training even more affordable for low-wage workers (LWWs), we launched the Workfare Training Support Scheme (WTS) in 2010. The WTS provides higher training grants to employers and LWWs, including absentee payroll. WDA also partnered HDB and the Singapore Institute of Retail Studies (SIRS) to roll out an on-site bite-sized training programme for retail SMEs in HDB estates to make training more accessible to SMEs with small numbers of staff. In this programme, training is conducted within the locality of the shops at convenient times (such as before store opening). Some SMEs may not be aware of avenues available to them to improve worker productivity and skills. Recognising this, WDA and SPRING Singapore jointly initiated the SME Productivity Action Roadmap (SME-PRO) last year: a three-step approach to assist SMEs in productivity improvement. There are also five Enterprise Development Centres (EDCs) set up jointly by SPRING Singapore and key business chambers and associations to provide business advisory services to SMEs.”
“Based on SPRING Singapore’s current definition, SMEs refer to enterprises with net fixed assets not more than $15 million for those in the manufacturing sector, and employment size not more than 200 workers for those in the services sector. 2. This refers to establishments with at least 200 employees. 3. This refers to establishments with 25-199 employees. WRITTEN ANSWERS TO QUESTIONS CREDIT CARD DEFAULTS AND ROLLOVER DEBT 1. Mdm Ho Geok Choo asked the Senior Minister (a) apart from MoneySENSE publications, what other forms of public education are available to credit card holders, especially the young and newly employed; (b) over the last 10 years, what is the number of credit card holders who have been declared bankrupt due to their inability to pay their dues; and (c) what form of vigilance does the MAS exercise to ensure that the number of credit card defaulters is minimised. 2. Mr Christopher de Souza asked the Senior Minister (a) how our credit card rollover debt compare against those of developed countries; (b) if there is any age group or population segment which incurs significantly higher rollover debt; and (c) how will it be ensured that credit is not too easily extended by way of credit cards such that personal debt becomes a serious problem.”
“For example, the ADVANTAGE! Scheme provides a financial grant of up to $400,000 to support companies in implementing re-employment. The Scheme includes a Capability Development Grant of up to $10,000 per company which is targeted to help the SMEs develop proper HR systems to implement re-employment. Employers can also attend the PREPARE Programme offered by ASME, or the 4R ("Recruit, Retain, Re-employ and Re-career") programme offered by SNEF, to equip themselves with the skills and knowledge to implement re-employment strategies. The Government also provides training opportunities and incentives to companies to upgrade the skills and improve the productivity of older workers, including those employed by smaller SMEs. For example, we introduced the Workfare Training Support scheme (WTS) to reward workers who sustain their training efforts. The WTS also provides higher training grants to employers and low-wage workers including absentee payroll. WDA, together with HDB and the Singapore Institute of Retail Studies (SIRS), has launched the Heartland Retail Workforce Upskilling Programme for retail shops in HDB estates which generally hire small numbers of employees. This program provides coaching to SMEs in HDB estates on how to boost their productivity and rolls out bite-sized training programmes on-site to make training more accessible to workers. Employers, including SMEs, may seek advice and assistance from my Ministry or the tripartite partners, SNEF and NTUC, so that they will be ready when the re-employment law comes into effect in a year’s time. 1.”
“In 2010, there were around 20,000 resident employees aged 60. This is the likely number of employees to be affected by the new re-employment requirements as they attain the statutory minimum retirement age of 62 in 2012 when the Retirement and Re-employment Act (RRA) comes into force. We do not have figures on the number of local employees in small and medium enterprises (SMEs) with less than 20 employees who will be affected by the legislation in 2012. However, about one quarter of the manufacturing and services workers who make up the bulk of our workforce are employed in SMEs1 of less than 20 people. The re-employment law applies similarly to large and small companies. As re-employment provides flexibility to meet the needs of both employers and employees, we expect that the majority of employers including SMEs will be able to re-employ their employees when the re-employment law comes into force. Based on a survey done by my Ministry in 2009, nearly two-thirds (64%) of the companies surveyed already allowed their employees to work past age 62. Of those companies that had employees reaching the age of 62, a vast majority (92%) of their employees were allowed to work beyond 62. However, the survey also shows that larger companies2 are more prepared for re-employment than the SMEs. Seventy-nine percent of the larger companies had already allowed their employees to work beyond age 62, as compared to 62% for the small companies3. The key challenge faced by SMEs in implementing re-employment is the lack of resources to put in place HR practices and processes for re-employment. For SMEs who require help, we encourage them to tap on the range of resources and programmes that the tripartite partners have put in place to help employers implement re-employment.”
“Even though paternity leave is not specifically legislated, MOM’s survey showed that about 48% of private sector establishments with at least 25 employees provided paternity leave last year. In addition, all working fathers of Singaporean children enjoy six days of paid childcare leave for children aged up to seven years old and six days of unpaid infant care leave for children aged up to two years old as provided for under the Children Development Co-Savings Act (CDCA). On the proportion of paid childcare leave taken by fathers, in 2009, there were more than 25,000 claims made in respect of Government-paid childcare leave taken by fathers, just slightly below the 27,000 claims for mothers. Last year, about two in 10 (about 19%) private sector establishments also provided childcare sick leave beyond the legal requirements. Anecdotally, companies may also provide flexible work arrangements or allow working parents to take time-off on an informal basis for them to attend to the needs of their children. However, as such work arrangements are non-statutory, and usually arranged under mutual agreement between the employer and employee, we do not have data on the take-up by working fathers. EMPLOYERS' READINESS FOR RE-EMPLOYMENT SCHEME 23. Mr Viswa Sadasivan asked the Minister for Manpower when the law on re-hiring of retired employees comes into force in 2012 (a) how many Singapore citizen/PR employees are likely to be affected; (b) of these, how many are likely to be in smaller SMEs with less than 20 employees each; and (c) how strongly will the law be enforced on smaller SMEs who may have genuine difficulty in re-hiring retired workers.”
“The Government has also introduced a Productivity and Innovation Credit (PIC) during last year’s Budget to provide enhanced tax deductions when companies undertake productivity or innovation-related investments, such as training, research and development, and design. At the same time, the Government is working closely with our tripartite partners to facilitate the employment of local residents. For example, we have a large pool of inactive residents, especially women, who could be encouraged to rejoin the workforce if the jobs offered flexibility. The Flexi-Works! scheme offers a grant of $100,000 to help companies hire the economically-inactive on part-time or flexible work arrangements. NTUC Women’s Development Secretariat (WDS) also holds regular job fairs targeted at women who are new to the workforce or who have not worked for a long time. Another pool of potential labour that companies can tap on is the older residents. The Retirement and Re-employment Act will take effect from 1st January 2012 to provide more job opportunities for older workers. Through the ADVANTAGE! Scheme, we offer a financial grant of up to $400,000 to help companies recruit, retain and re-employ older workers. Sir, therefore, I encourage businesses that have manpower needs to tap on these sources of local residents and make use of the various schemes for their businesses to raise their productivity and to reduce their reliance on foreign workers. 3.00 pm”
“Mr Speaker, Sir, the robust economic recovery in 2010 had brought about strong economic and employment growth. As a result, job vacancies rose by 36% over the year, to 50,200 in September 2010. Amidst the tight labour market, it is natural for employers to desire greater access to foreign workers. However, an over-reliance on low-skilled foreign workforce is not sustainable in the long term. Companies which are heavily dependent on low-skilled foreign workers for growth should instead improve their productivity – they should move up the value chain, review their business models, redesign work processes, and upgrade the skills of their workers. Such efforts will not only enhance their competitiveness but are, in fact, critical for their viability. This is why we need to continue to moderate the demand for foreign manpower and encourage companies to improve efficiency and raise productivity. Sir, we announced last year that the Foreign Worker Levy (FWL) for Work Permit and S-Pass holders would be increased in phases, starting from 1st July 2010. Entry criteria and other requirements have also been finetuned to raise the quality of our foreign workforce here. The Government has introduced several schemes to help companies innovate and improve. For example, the Government has established a S$2 billion National Productivity Fund (NPF) to support productivity initiatives at all levels. In particular, the Building and Construction Authority (BCA) has tapped on the NPF to launch the S$250 million Construction Productivity and Capability Fund (CPCF) which aims to improve productivity in the construction sector through technology adoption, workforce development and training, and capability development.”
“We have consistently shown courage and innovation in developing our own solutions, such as the Jobs Credit Scheme, the Skills Programme for Upgrading and Resilience during the recession; and also Workfare, as the way to help our low-wage workers. I am pleased that Members support this approach. The Government will continue to work with our tripartite partners to foster inclusive growth for all Singaporeans. Together, we will create our own Singapore Dream where we progress together as one nation and as one people. Mdm Deputy Speaker, I support the motion. 6.05 pm”
“We help our low-wage workers in ways that are effective and sustainable. We provide assistance for their immediate, daily needs through support mechanisms such as ComCare as well as housing and healthcare subsidies. We encourage them to work so that they can be self-reliant and earn more through WIS. We also provide support to help them build a better future for themselves through training and skills upgrading under WTS. Helping the low-wage workers is like a farmer looking after his crops. The farmer wants the seedlings to grow strong, but he cannot pull the seedlings up to make them grow. He must take care of them with love and care. If he forces the seedlings to grow, they will end up withering instead. Therefore, we must continue to put forward various incentives and schemes to help the low-wage workers. We should not consider a minimum wage system. (In English): I would like to assure the House that the Government has been concerned about low-wage workers. We should avoid creating an artificial support system that may slowly erode our values. We help our low-wage workers in ways that are effective and sustainable. We provide assistance for their families, we will provide help for their immediate needs through support mechanisms such as ComCare as well as housing and healthcare subsidies. We encourage them to work so that they can be self-reliant and earn more through Workfare. We also provide support to help them to build a better future for themselves through training and skills upgrading through Workfare Training Support scheme. Our approach preserves the strong work ethic of our people and addresses the fundamental cause of income inequality. Madam, we need not follow in other countries' footsteps.”
“I mentioned that Workfare provides income supplement of up to 25%. Can you imagine setting a minimum wage that requires employers to pay an additional 25% to the low-skilled workers? Madam, Workfare is not cheap. It is a programme that not many countries can afford, as Minister Lim pointed out. These countries do not have as strong a fiscal position as Singapore. We are able to do so because we have enjoyed strong economic growth for a number of years. Workfare is also more inclusive as it includes self-employed persons, unlike a minimum wage which only applies to employees. This is important as around one-fifth of low-wage workers in our workforce are self-employed. More importantly, Workfare sets low-wage workers on a sustainable path to income growth by obtaining better skills. This is in direct contrast to a minimum wage which discourages training and upgrading. Assoc. Prof. Paulin Straughan was concerned about the working conditions of low-wage workers. Madam, beyond Workfare, we work with our tripartite partners to improve working conditions for low-wage workers and encourage fair and progressive employment practices. For example, Mr Zainudin Nordin talked about the Unit for Casual and Contracts Workers (UCCW) and how it helps workers improve their working conditions. My Senior Parliamentary Secretary chairs a tripartite committee to look into ways to improve working conditions of these low-wage workers. We will continue to do more. Mdm Deputy Speaker, may I now conclude in Mandarin. (In Mandarin): [For vernacular speech, please refer to Appendix A*.] Mdm Deputy Speaker, the Government has *Cols. 2495-2496. always been concerned about low-wage workers. We should avoid creating an artificial support system that may slowly erode our values.”
“However, our efforts may be reversed by a minimum wage policy, as it could discourage upgrading and mobility. A guaranteed level of income may remove the incentive for training for the less productive. For lower-skilled workers, if they earn the same wages as the higher-skilled workers, there is no incentive for them to upgrade. When the minimum wage level is raised, both will enjoy the same higher wages. There is no incentive for them to work harder, to work smarter, to innovate and to improve their productivity. This way, the minimum wage will become their maximum wage. Thirdly, a minimum wage will affect the competitiveness of businesses as the cost is borne by the employers. If businesses cannot compete, they may choose to move to another country. New investments will slow down. The end result will be that our local workers, not just low-wage workers, but all workers will have fewer jobs. Instead of earning a minimum wage, they may end up earning no wage at all, just like Mr Heng Chee How pointed out. Because of these concerns and others which some Members like Mr Heng Chee How, Mrs Josephine Teo and Ms Jessica Tan have highlighted, the Government is not in favour of a minimum wage. I am glad that Mr Low has just stepped in and he has confirmed that the Workers' Party is also not asking for a minimum wage for now. We all agree that we are all for helping low-wage workers and this is where Workfare comes in. Workfare is better than a minimum wage. Like a minimum wage, it helps our low-wage workers earn a better income. But unlike a minimum wage, Workfare does not risk displacing low-skilled workers because the cost is borne by the Government. Employers are not burdened with paying a high wage that is not supported by the productivity of the workers.”
“On the other hand, unions have been unhappy with the Taiwanese government's earlier decision during the recent recession to maintain the minimum wage at the 2007 level. Instead of working on cutting costs to save jobs, the unions wanted to raise the minimum wage. Even with this year's increase, the unions in Taiwan remain dissatisfied, claiming that the increment is not enough. This constant disagreement over the minimum wage level is harmful to tripartite relations. The experiences of Hong Kong and Taiwan are just a sample of the practical difficulties that economies face with a minimum wage. Apart from implementation difficulties, a minimum wage may also hurt low-wage, low-skilled workers, the very same group that such a policy was designed to help. How is this so? First, a minimum wage carries the risk of displacing low-wage workers. This is simple demand and supply. If the price of labour goes up, employers will look for alternatives: cut jobs to save costs, rather than cut costs to save jobs. They will reduce benefits or working hours to lower wage costs. Workers may end up receiving less. Employers will not want to pay a salary that is higher than what is justified by the productivity and skills of their workers. Our unemployment rate is lower than most other countries, even during times of recession. This can be attributed to our flexible and responsive labour market and, certainly, the flexibility of our wage system. Let me show Members this chart*. This chart shows that our unemployment rate was one of the lowest in the world during the recent downturn and, in fact, it is the lowest most of the time. *Cols. 2479-2480. Madam, today, we foster a culture of continuous learning to achieve productivity growth.”
“A data and research outfit, the Business Monitor International, has cautioned that the minimum wage may partially erode Hong Kong's economic advantage as a leading free market economy. Prof. Francis Lui, an economist and former government advisor, has also estimated that up to 100,000 low-wage workers may lose their jobs when the minimum wage law takes effect. The impact will be worse during a recession because employers are more likely to retrench low-wage workers who are drawing the minimum wage as they cannot adjust their wages. These workers will bear the brunt of job losses. Even with the impending minimum wage, unions have criticised the law for not doing enough, lobbying for a higher minimum wage of HK$33 per hour, approximately S$5.49 per hour. But a higher minimum wage carries higher economic costs and risks and could instead hurt low-wage workers. So the minimum wage has created these undercurrents in Hong Kong, between businesses, unions and the government. Next, in Taiwan. The adjustment of the minimum wage level has also been a contentious issue. Between 1997 and 2007, the minimum wage in Taiwan remained constant, for fear that higher labour costs would affect their economic competitiveness. This is exactly what Minister Lim Swee Say talked about – the "sticky wage". In July 2007, the Taiwanese government decided to increase the minimum wage by 9.1%. Businesses reacted strongly and the government had to scramble to provide relief packages to lessen the financial impact. However, this added a financial burden to the government and the minimum wage ended up being a double-draw on the economy, from both businesses and the government. But this year, Taiwan's minimum wage will be further increased.”
“Between 2008 and 2009, about 20,000 workers graduated from WIS because their incomes had grown. With higher incomes, they are in a better position to provide for their families. Some Members such as Mrs Josephine Teo, Ms Denise Phua, Ms Irene Ng and Mr Low Thia Khiang have suggested various ways to adjust and fine-tune WIS. I thank them for their suggestions and my Ministry will study them. We have to be mindful not to over tweak WIS. We must allow time for the scheme to be implemented, for the effects to benefit the workers. But we will take in their recommendations and suggestions in our review of WIS. Madam, now and then, we hear calls to impose a minimum wage to lift the incomes of the low-wage workers, just as many advanced countries have done. Mr Sadasivan asked if we could consider a minimum wage because many countries have done so. We should be mindful that each country's situation is unique and each must find the best way to address its challenges. We should resist the temptation to follow others blindly. In fact, contrary to what Mr Sadasivan believes, the experiences of economies with a minimum wage show that they are not at all happy. Let me just share a few examples. Hong Kong's minimum wage law will come into effect in May this year, at HK$28 an hour which is approximately S$4.66. By the way, domestic helpers in Hong Kong also receive a Minimum Allowable Wage of HK$3,580, or about S$600 a month. However, both the law as well as the level of the minimum wage have created a lot of problems in Hong Kong. Businesses are concerned that the minimum wage will inject inflexibility into the labour market and increase costs.”
“Third, Workfare helps low-wage workers to upgrade. To lift them out of low-wage work, we need to help them acquire skills to take on higher-value jobs. The Workfare Training Support (WTS) scheme that we introduced last year helps to achieve this, through a combination of incentives to encourage the low-wage workers to go for training, as well as generous subsidies on course fees and absentee payroll support for their employers. We understand the concern expressed by Mrs Mildred Tan and Assoc. Prof. Paulin Straughan that training for low-wage workers has to be accessible and preferably near their homes and workplaces. Indeed, we have rolled out a number of programmes together with our partners, including HDB, as well as merchant associations in the shopping malls, to provide training programmes right at the centre of the shopping areas in the heartlands so that these retail workers can have access to these training programmes during their break time. It is convenient for them, and we encourage them to participate in these training programmes. Ms Denise Phua asked about CET for the disabled. My Ministry will discuss with MCYS how best to address this issue. Madam, through training we help low-wage, low-skilled workers to progress to a better job and earn a better pay. Members may have read about Mr Sivakumar Munisamy, who was featured in the Straits Times last week. He is a security guard at a primary school in Woodlands, and a WIS recipient. With his good performance, I understand that he may be promoted this year and will receive a higher salary. While he may no longer be eligible for WIS as a result of his pay rise, we should be happy for him as this means that he has succeeded in moving up in his career. There are also many others like him.”
“Our programmes to help the lower-income share three basic principles. First, they must not diminish our strong work ethic, culture of self-reliance and the tradition of family support. Singapore could only come this far through the drive and energies of our people. We must therefore preserve this unique spirit that makes us Singaporean. Second, they must address the workers' fundamental needs. The schemes that we introduce must provide immediate relief for these workers, but should also deal with the underlying causes of their lower wages. Otherwise, we risk keeping them permanently trapped in their low-wage conditions rather than helping them. Third, our programmes must be practical and sustainable, taking into account the local context. We must not simply follow what other countries have done. It is these principles that guide our approach to Workfare. We introduced Workfare in 2007 to help older low-wage workers deal with the challenges of globalisation. Today, some 400,000 Singaporeans earning a gross income of up to $1,700 a month receive about $400 million a year from Workfare. Workfare helps low-wage workers in three ways. First, the Workfare Income Supplement (WIS) supplements their income by up to 25%. WIS is paid in cash and CPF. The cash helps workers to meet their most immediate requirements which Mr Viswa Sadasivan was concerned about. The CPF component is for longer-term needs, such as housing, education, healthcare as well as retirement. Second, Workfare encourages workers to continue to work. Those who were previously out of the workforce will also be more motivated to get a job because of the higher total income they can enjoy. By making regular work a condition for Workfare, we are actually helping to strengthen self-reliance.”
“From time to time, the Government implements special budgetary transfers, which are weighted in favour of these less well-off. These include top-ups to CPF, GST Credits, U-Save vouchers, Growth Dividends, and so on. Between 2007 and 2009, households in the first quintile income group received over $650 million from the various Government transfers. Mr Low Thia Khiang talked about Gini coefficient. Madam, Workfare and Government transfers helped to improve our Gini coefficient from 0.478 to 0.453 in 2009 – this is lower than 0.456 in 2001 before Government transfers. This means that these measures have helped to slow down the widening of the income gap. In comparison, the Gini coefficient in the United States increased marginally over the same period. But we should not read too much into the Gini coefficient, which is just a statistical measure. It does not tell us how well our low-wage workers, our low-income families are doing as it does not account for housing, healthcare and other benefits, which Singaporeans enjoy. Mr Heng Chee How is right in saying that these Government transfers, though helpful and timely, are not long-term solutions. As pointed out by several Members, education and training are fundamental to uplift low-wage workers and their families. We must continue to invest in our children – the next generation. We have recently announced a series of measures to raise the affordability and quality of our education, especially the pre-school education and childcare services. Our education policies have been designed to level the playing field and ensure that all children receive high quality education and have an equal chance of success in their lives, regardless of the socio-economic status of their parents.”
“Mdm Halimah asked about capacity and accessibility of nursing homes. Minister Khaw has already given his reply on Monday to a similar parliamentary question and, therefore, I will not go into the details. In general, the "3M" framework of Medisave, MediShield and Medifund, ensures that no Singaporean will be denied of good healthcare. For those who do not have the means, the group which Mr Viswa Sadasivan is most concerned about, the Medifund serves as the safety net. Medifund pays out $64 million in 2009 as direct subsidies and we will top it up from time to time. Mr Sadasivan also asked whether low-income families could be given more help. For families who face serious financial difficulties, there is ComCare. A total of $210 million has been disbursed since it was introduced in 2005. Today, ComCare not only targets the Government's assistance at needy and low-wage workers but also mobilises the community to help them through the "many helping hands" approach, as highlighted by Mr Zainudin Nordin, who is also the Mayor of the Central CDC. The CDCs also provide a lot of support. For older low-wage workers, we introduced Workfare in 2007. I will talk more about Workfare later. Mrs Josephine Teo mentioned the Inclusive Growth Programme (IGP), which was one of the first programmes endorsed by the National Productivity and Continuing Education Council. Mr Seng also shared a few examples of those who benefited from IGP. I am pleased to hear the encouraging results after just a few months. The Council will review the programme after two years. There are many other programmes as highlighted by various Members: Best Sourcing Initiative, Customer-Centric Initiative, JRP, and so on, all aimed at helping these low-wage, low-skilled workers.”
“Last year, the Government reinforced its commitment to helping the lower-income and accepted the recommendations of the Economic Strategies Committee (ESC) on inclusive growth. In particular, the Government agreed to raise productivity through skills and innovation and to moderate the dependence on foreign workers through our foreign worker levy mechanism. The first two rounds of levy increases were effected in July last year and earlier this month, with more to come. When the announced increases are fully completed, the levy will range from $200 to $450 per foreign worker per month. If we add the Workfare Income Supplement (WIS) that the low-wage workers will receive, the advantage for local workers can be as high as almost $700 a month versus a foreign worker. With higher foreign worker levy, therefore, we tilt the balance in favour of local workers, in particular our low-skilled, low-wage workers. As Members have pointed out, the notion of inclusive growth is not new to the Government. Over the years, the Government has introduced many initiatives to help low-wage Singaporeans. Let me just highlight a few. Housing is one example. In addition to substantial subsidies for first-time homeowners and concessionary interest rates on housing loans, lower-income families enjoy an additional CPF Housing Grant of up to $40,000. Among households in the first quintile, 85% own their flat. The average home equity of their flats, which is the market value minus the outstanding loan, is about $242,000. Few countries in the world, if any, have achieved such a high level of home ownership and asset value among their low-income families. Healthcare is another example. Our public hospitals and polyclinics are heavily subsidised.”
“Mdm Deputy Speaker, thank you for allowing me to speak. First, I would like to thank Mrs Josephine Teo for introducing this motion. I would also like to thank Members for supporting the Government's efforts and approach to help these workers and for making useful suggestions. Madam, I agree with Members that Singapore's economic growth must be inclusive and sustainable. This means that everyone who has put in their best efforts must be able to share in this growth and look forward to better lives. Over the years, lower-income families have indeed benefited from our economic progress. Take household incomes, for example. In the last decade between year 2000 and 2008, the first quintile of employed households saw their household incomes after taxes and transfers grow by an average of 3.9% per year, from $19,000 to $25,900. Even after taking inflation into account, real income grew by 1.7% per year. Members like Mrs Josephine Teo, Mr Yeo Guat Kwang and Mdm Halimah Yacob have also shared heartwarming examples of individual low-wage earners making progress. Madam, we must accept the reality that the pace of growth will be uneven across our population. Highly-skilled Singaporeans are globally mobile and will command salaries that are similar to their counterparts in the US and Europe. On the other hand, our unskilled workers will face competition from the less-developed countries. Being a small and open economy, we have no choice but to remain globally competitive and manage the income differences the best we can. If we become uncompetitive, we will risk stagnation and have fewer resources to help the lower income. Everyone will lose out. This is not a race among ourselves, but a global race between Singapore and the rest of the world.”
“The retirement age today, let me explain again, is 62. The CPF Draw-Down Age would be 65. So they are not linked. We have introduced re-employment to allow our workers to work from 62 to 65. But the retirement age remains at 62. The Draw-Down Age would be gradually moved to 65 based on a schedule which we have announced in 2007. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. – [Mr Gan Kim Yong]. Bill considered in Committee. [Mr Deputy Speaker in the Chair]”
“Mr Deputy Speaker, Sir, let me just clarify. I have mentioned in my speech quite categorically that the retirement age will stay at 62. We allow workers to retire at 62 and continue to be employed under re-employment legislation from 62 to 65. Eventually, we may think about extending the re-employment to 67. I also said in my speech that for the time being, let us focus on implementing re-employment up to 65. We have the intention of raising it to 67. But when that would happen, it would depend on the economic environment and on the average life span of Singaporeans. It depends on many other factors. Therefore, it is better for us to focus on implementing the legislation, that is, put it in place, ensure that we work with employers and unions, and make sure there is smooth implementation and address some of the misunderstanding, difficulties and the friction in implementing it. This is the more immediate task than to discuss when re-employment would be extended to 67.”
“We have to start from the point that this older worker has been with this company before he reaches 62. So, the company has a job for him at 62. The vast majority of the companies will continue to have a job for him when he goes beyond 62. But there may be some necessity to make some adjustments to the job scope, remuneration, or the terms of the employment that are provided within the re-employment legislation. Rather than focusing on EAP which, I want to stress again, should be viewed as a last resort, it is better for us to focus on creating opportunities for them to work. Our tripartite partners will work with these companies, including the SMEs, to re-design the job processes, to create more opportunities by making their job processes more age-friendly. Given the high employment rate of older workers and the fact that the vast majority are able to continue to be re-employed by the same employer, I am quite confident that most of the companies would be able to find solutions to provide employment opportunities for our older workers.”
“For that reason, we are putting in place the CPF LIFE.”
“Sir, to answer the second question first: to stretch out the payment period so that it lasts longer with the same amount of savings would just mean that they would have less every year and that may not be enough for them. So, with the same amount of savings, it is either that the savings will last longer with a lower amount or the savings will last a shorter time. The better solution is to continue to add on to the savings. That is why the Workfare Income Supplement has a CPF component to help top up the CPF savings and if the worker continues to work, he will then be able to accumulate more savings. If he starts to draw down later, his savings would then last longer. Ms Lim also mentioned about those who really cannot work. There will be a small minority of older workers who may be medically fit but unable to work for a variety of reasons. But this remains a small minority. As I mentioned, the unemployment rate for the older workers remains very small – it is about 3% today. So, rather than re-design the CPF scheme to cater to this small group of minorities which might have difficulties, it is better for us to deal with these cases on a case-by-case basis. And we should not label them as "unemployable" and therefore allow them to draw down from the CPF. It is better for us to continue to encourage them to look for work and if they have problems dealing with their living expenses and so on, we still have many other social safety nets to help to support them including ComCare fund. So, it is better for us to design the scheme based on the needs of the majority, and that is those who are able to work will continue to work. Let us encourage them to continue to work and draw down their CPF savings later so that it will last longer.”
“Sir, let me clarify that the purpose of raising the Draw-Down Age for CPF is to ensure that the savings will last longer. As Ms Sylvia Lim also pointed out, we have to ensure that there are enough savings for them as their life expectancy increases. We introduced CPF LIFE for that reason to ensure that the savings are able to last a lifetime. For workers who are unable to find jobs, what is more important for us is to explore opportunities and ways to help them find jobs. We have put in place Workfare Income Supplement (WIS) to ensure that those who are working will get a top-up if they are among the low-wage, low-skilled workers. If they are older, in fact, the WIS has an additional payment for them. We also introduced the Workfare Training Scheme last year, targeted at these workers to help them acquire the necessary skills so that they are able to find job opportunities. So, instead of encouraging them to draw down their CPF savings, and as a result run out of savings when they grow old, it is better to encourage them to work while they are still young or while they are still able to work. And for those who are medically unable to work – some of them unfortunately might have met with an accident or might have suffered a medical illness – we have provisions for them to draw down their CPF savings earlier to support their living expenses. So the scheme is already in place.”
“Sir, Mr Hri Kumar is right in that employment contract allows flexibility for the employer to exercise contractual termination based on their business needs. However, as the worker approaches the retirement age of 62, the employers will have to ensure that even if they terminate the worker contractually, it is not on the basis of age. So, the Member is right that there is flexibility in the market, the labour market has to be able to respond to economic changes and the employers must have the flexibility to be able to hire and terminate as provided in the employment contracts. But we will examine the circumstances leading to the termination of the employment contract, whether it is done on the grounds of age, and if it is so, the Minister can order a reinstatement of the job. As Mr Hri Kumar also pointed out earlier, it is not so easy to reinstate the job because the relationship would have soured and we will look at other alternatives, including compensation. It is an issue that we will continue to have to work with employers to ensure that more opportunities will be given to the older workers and to protect their employment rights.”
“With the continued support of the unions and employers, we will press on with our efforts to ensure an effective and smooth implementation of the re-employment law.”
“This is because 60% of members will live longer than 82 years, which Mr Low also pointed out; that lifespan is extending. By the time they reach 82, most will not be able to work. It is therefore better to work longer earlier and to draw-down later, than to draw-down now and when savings run out, workers will be older and will find it more difficult to find jobs. I am sure this is not what Mr Low and Ms Lim would like to see. Mdm Ho also asked whether we can provide incentives to help older workers work longer. Sir, the Workfare Income Supplement serves to do just that, with more for older workers, up to $2,800 a year, including a CPF component. Sir, rather than drawing down CPF early, it is better for us to help workers find jobs. Given the flexibility that the RRA provides and that the majority of older employees continue to work beyond 62, we expect a large majority of the employees would be able to be re-employed come 2012. For those who are not re-employed by their existing employer, they are encouraged to look for alternative employment so that they can continue to earn a regular income to improve their financial adequacy. And we will help them. Employees can approach e2i or WDA's career centres for employment assistance. Better for us to help them find a job than to bring forward the Draw-Down Age of CPF; better to help them fish than to ask them to eat the fish they are saving up for old age. Sir, I believe I have addressed Members' concerns and queries. As highlighted by several of our Members, the Bill balances the objectives of providing opportunities for more employees to work beyond retirement, with the need to maintain the flexibility in implementation to allow employers to continue to tap on the pool of experienced and skilled older workers.”
“The amount of compensation may be enhanced, depending on the circumstances of the case, including whether the employer has made reasonable attempts to re-employ the worker at the onset. Mr Heng Chee How asked whether employees who will attain the specified age on or after 1st January 2012, can approach my Ministry for mediation if they encounter any dispute before 1st January 2012. While the Act will take effect from 1st January 2012, employers and employees who encounter difficulties on re-employment before then can still approach MOM for advice and assistance. Mr Heng has also asked why the law will only come into effect a year later, on 1st January 2012, and whether there is anything MOM could do for those who are retiring this year. Sir, it will take time for employers to put in place systems and processes to support the implementation of re-employment. Employees would also need time to discuss possible re-employment options with their employers and make adjustments, where necessary. We have announced earlier that the law will take effect in 2012. But we have presented the Bill ahead of time so that employers and employees will have early knowledge of what to expect, come 1st January 2012, and will start to prepare for re-employment. For employees who are retiring in 2011, the tripartite partners will continue to encourage companies and workers to implement re-employment early. Mr Low Thia Khiang and Ms Sylvia Lim also asked why the CPF Draw-Down Age should be raised to 65. Sir, in 2007, when Parliament debated on the decision to raise CPF Draw-Down Age from 62 to 65, we explained then that even with the CPF reforms which we were introducing at that time, many members would still run out of savings if we start the Draw-Down Age at 62.”