Josephine Teo
Singapore
“The Government's risk-calibrated approach to data security in artificial intelligence (AI) systems was explained in a written reply, given on 9 January 2024, to related questions asked by Dr Tan Wu Meng and Mr Gerald Giam.”
“Access to frontier models is helpful for specific use cases, such as advanced research and cybersecurity. However, these form a small proportion of artificial intelligence (AI) demand. For most industry, Government and research uses, capable models are already available.”
“The Government tracks the development of technical standards for identifying artificial intelligence (AI)-generated content, including watermarking and digital provenance approaches, as part of broader efforts to manage AI-related risks.”
“Upon receiving a valid report of intimate image abuse, the Commissioner of Online Safety is empowered by law to direct Online Service Providers (OSPs) to disable access by Singapore users to the specified harmful online material. This direction may be extended to cover identical copies found on the platform.”
“The Government is committed to keeping children safe online. We have announced plans to extend age assurance requirements to designated social media services, including requiring platforms to keep users under 13 off their services.”
“Under the Online Safety (Relief and Accountability) Act 2025, the Commissioner of Online Safety is empowered to issue directions to platforms to remove specified harmful content, including intimate image abuse.”
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“This scheme aims to promote auctions and exhibitions and use of specialised storage facilities in Singapore. Clause 8 of the Bill extends the scheme to cover goods removed temporarily for repair, conservation and restoration. This is because it may not be practical for all repairs to be done within the Approved Specialised Warehouses. Fourth, consistent with the third amendment, we will allow GST zero-rating of repair services performed on qualified goods outside of Approved Specialised Warehouse. Currently, repair services performed inside Approved Specialised Warehouses to restore and conserve the qualifying goods are GST zero-rated. Clause 5(c) of the Bill extends the GST zero-rating to repair services performed on the qualifying goods when they are temporarily outside the Approved Specialised Warehouses. Finally, the Bill makes two technical amendments with no change in policy. The first is to align the general provision on zero-rating of exports and international services with that for the Approved Marine Customers Scheme and Specialised Warehouse Scheme. The second standardises the text used in the different subsections for the Approved Contract Manufacturer and Trader (ACMT) Scheme. Sir, I beg to move. Question proposed. 4.11 pm Page: 618”
“The remaining six amendments to the GST Act arose from our on-going review of GST policies and administration. First, we will extend the scope of GST zero-rating of prescribed financial services relating to goods for export. Currently, GST zero-rating is applicable to prescribed financial services, such as export credit and trade credit insurance, in relation to goods for export from Singapore. Clause 5(b) of the Bill extends GST zero-rating to the same financial services in relation to supplies involving goods that are located outside Singapore. This is in line with the existing policy of maintaining the competitiveness of our international services. Second, we will allow the Comptroller and Minister to set conditions when granting remission. Currently, the Minister and the Comptroller of GST have powers under the GST Act to grant remission of GST on grounds of poverty or where it is just and equitable to do so. Clause 12 of the Bill provides clarity on the Comptroller's and Minister's powers to impose conditions when granting such remissions so as to prevent potential abuse. Clause 12 also provides for the tax remitted to be recoverable in the event of the taxpayer's failure to comply with the conditions imposed. The provisions in clause 12 are similar to those in other Acts, such as the Income Tax Act and Stamp Duties Act. Third, we will extend the Temporary Removal Scheme to goods removed temporarily from approved warehouses for repairs. Currently, the Temporary Removal Scheme allows qualifying goods, such as art pieces, to be removed temporarily from approved warehouses under Singapore Customs' control for auctions and exhibitions without the payment of import GST.”
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Goods and Services Tax (Amendment) Bill 2012, or the GST Bill for short, comprises seven amendments. The first amendment gives legislative effect to a GST initiative announced in Budget 2012. The remaining six amendments arise from our ongoing review of the GST system. The draft Bill was released for public consultation in July 2012. It incorporates relevant feedback and suggestions from the public. Let me first touch on the provisions in the Bill that give legislative effect to a GST initiative announced in Budget 2012, namely, GST exemption for investment-grade gold and precious metals. Clauses 3, 6 and 14 of the Bill provide for GST exemption on the import and supply of investment-grade gold and precious metals. This move supports IE Singapore to develop a new gold refining and trading cluster in Singapore. The exemption means that actively traded investment-grade gold and other precious metals will enjoy the same GST treatment as other financial instruments that do not attract GST. Clauses 2, 7, 11, 13 and 15 of the Bill are consequential amendments to administer the change. In addition, to facilitate precious metal refining, a new GST scheme will be introduced for qualifying refiners of precious metals and consolidators of scrap materials for refining. The new scheme confers two benefits. First, it eases cash flow by suspending the payment of GST on the import and purchase of scrap materials for refining. Second, it allows claiming of input tax incurred for consolidating and refining scrap materials into investment-grade precious metals. Page: 617 Clauses 4 and 10 of the Bill give effect to the scheme.”
“Nonetheless, the number of graduates in Singapore is also on the rise. Thirty percent of each cohort will get a degree. Forty percent will get a polytechnic diploma, and of the 40%, nearly 60% will advance to degree qualifications within 10 years of graduating. Now, this means that in total, about 54% or well over half of the current and future cohorts of Singaporeans will be degree-qualified. I think this is great news for parents and goes a long way to meeting the aspirations of younger Singaporeans, provided we are able to ensure the employability of university graduates within Singapore and in competition with the rest of the world. Only then will a university degree be a meaningful attainment, fulfilling the expectations of the parents and graduates alike. Sir, I look forward to hearing the Minister's view on this. *Cols. 4857-4858. 4.09 pm”
“In the face of such intense competition, how will we ensure Singapore graduates, in particular, those from a new university like SUTD, firstly, will secure employment upon graduation? And, secondly, have an education that prepares them for the global competition? Sir, finally, I would like to touch on the issue of affordability. During this year's Committee of Supply, the Minister for Education outlined the many ways in which our education system still provided opportunities for upward social mobility. Sir, the fees for the SUTD are going to be quite high, as the Minister has also acknowledged, and more than that for comparable courses in NUS and NTU. While I understand this is because of factors such as the student-faculty ratio, I would like to have the Minister's assurance, once again, that no student who qualifies for the SUTD will be denied an education there because his family cannot afford it. Sir, in conclusion, I would like to point out that Singapore has been very prudent in managing the number of university graduates. Taiwan, which has a population of about 23 million, has 23 universities and produces 250,000 college graduates each year, many of whom are under-employed or unemployed. As a Taiwanese education journalist noted, over 20% of the graduates would need to spend at least one year to land a job. Malaysia, our nearest neighbour, has a population of 29 million, 21 universities and produces 155,000 graduates each year. That is more than 10 times the number that we produce and theirs is a population of maybe five to six times of ours. Singapore produces far fewer new graduates each year. I did a quick calculation: it is about one for every 400 in our population. This compares to Taiwan's one per 100 population and Malaysia's one per 200 population.”
“(In English): I would like to make two observations. The first is that during the global financial crisis of 2008/2009, many college degree graduates in US and Europe lost their jobs to due to a combination of offshoring, productivity improvements and lack of economic growth. One estimate is that close to 1.1 million jobs in corporate finance, IT and other business functions were lost in large US and European companies in 2008 and 2009. Over 1.3 million additional jobs will disappear by 2014. Many of these are white-collar jobs held by college degree holders. The second observation is that the trend of offshoring white-collar jobs has emerged due in large part to a vastly increased supply of university graduates in countries like China. In 1998, China produced fewer than 900,000 university graduates each year. In a little over a decade, this number has increased more than seven-fold. This year, it is estimated that nearly 6.5 million Chinese will graduate with a university degree. They will join an estimated 1.5 million graduates from the previous batches to compete for jobs in the labour market. We heard earlier from the Minister that China has set a goal of 8 million university graduates by 2020. So those are very large numbers indeed. Fortunately in Singapore, employment of fresh graduates has remained high. Typically, out of every 100 new university graduates, between 93 and 95 are able to find jobs within six months. Even during the very difficult years in 2008 and 2009, more than 90% of fresh graduates could find work within six months. Nonetheless, the global explosion in the supply of graduate workers will mean that we cannot assume this will be the case year after year.”
“Mr Speaker, Sir, I declare my interest as a member of the Board of Trustees of the SUTD. Sir, in Mandarin, please. (In Mandarin ): [For vernacular speech, please refer to Appendix A*.] Mr Speaker, whenever I do house visits in Toa Payoh, I will always notice the photos hanging on the walls of many residents' living rooms. The biggest and the best framed is usually the one with parents posing with their children donning the black graduation robes and the mortarboards. When parents talk about how their children have managed to improve themselves in times of adversity, the smiles reveal the pride in their heart. You see this kind of heartwarming scene more often in 3-room HDB apartments. Asian families value highly their children's education. To send their children to universities is many parents' life time dream; some would not hesitate to spend all their savings on their children's tuition. These parents have high expectations of their children, hoping that a good education will boost the children's career in the future. Hence, we must be very careful when it comes to planning our university education. Singapore University of Technology and Design (SUTD) will be Singapore's fourth university and the second brand new university after the independence. SUTD's uniqueness is that it does not only collaborate with a top US university, Massachusetts Institute of Technology (MIT), but also with one of China's top universities, Zhejiang University. SUTD is likely to become the pioneer of a new era of combining eastern and western education. There are two things we need to pay special attention to. First is the job prospects of SUTD's graduates; second, is how to lay a solid foundation for the students so that they can face the ever growing global competition.”
“Madam, I would like to seek a clarification in Mandarin, please. (In Mandarin): [For vernacular speech, please refer to Appendix A *.] I am very happy to hear that the Ministry of Manpower will be allocating $150 million for the training of PMETs. The experience of the US and several European countries showed that many white-collar jobs will be affected by offshore outsourcing or what is commonly known as "offshoring". These jobs include finance, IT, human resource management, law and medicine. Some of these jobs are traditionally held by highly educated professionals. In Singapore, such white-collar jobs make up more than half of our available jobs. Hence, I would like to ask the Ministry whether the "Future Skills Needs Survey" can focus on analysing in-depth the offshoring trend and its impact on our white-collar workers. We can then find suitable measures to deal with the problem. *Cols. 4543-4544.”
“" In fact, Princeton University Professors Alan Blinder and Alan Krueger suggest that high-wage jobs performed by highly-educated workers are more "offshoreable" than jobs done by low-paid, less-educated workers. This suggests that white-collar jobs performed by well-educated workers are now very much at risk in the advanced economies. What about Singapore? Today, 46% of our resident workforce holds at least diploma qualifications. PMETs comprise more than half of our resident workforce and number more than a million. On the one hand, we need to ensure that future growth is productivity-driven, and this may include offshoring by Singapore-based companies. On the other, we must ensure that there is continued job creation – not just any jobs but quality jobs. Having prepared rank-and-file workers to deal with structural unemployment in the mid-1990s, do we now need to prepare PMETs to deal with the offshoring trend? Can MOM please share the plans to better support PMETs, particularly in Continuing Education and Training?”
“Mr Chairman, Sir, among college graduates in the United States, unemployment peaked at 5% in February last year. This compares to the previous peaks of 3.2% for the recession beginning 2001, and 3.4% for the 1991 recession. Over in the United Kingdom, during the depths of the recession in March 2009, those who previously held skilled middle-class jobs but had started collecting unemployment benefits grew by 120% from a year ago. By comparison, those in unskilled work categories had risen a much lower 54%. This has led analysts to point out that the most recent recession affected white-collar workers at least as much as, if not more than less-skilled workers. It appears that white-collar jobs, many of which are filled by college-educated workers, have steadily become more vulnerable to economic downturns. This has been largely been attributed to the phenomenon of offshoring, which is when companies export white-collar work to lower-cost countries much like they used to export blue-collar manual work through "outsourcing". It is believed that the next major wave of offshoring is going to hit white-collar professional jobs in the US and Europe. Moreover, it is not just routine work like "data inputting" that is being offshored, but "knowledge work" like analysing X-rays, drawing up legal contracts and researching bank clients. Apparently, a North London primary school even hired mathematicians in India to provide one-to-one tutoring over the Internet. As the supply of graduate workers increase in developing countries, employers will be drawn by the offer of quality and lower cost. A recent Guardian article notes that, "The export of knowledge work requires only the transmission of electronic information, not factories and machinery.”
“Madam, I have two clarifications. The first clarification is for the Minister. I believe he said that half of the students from 1-, 2- and 3-room households eventually make it to polytechnics and universities, and this number has been quite stable over time. If I am not mistaken, universities and polytechnics have expanded enrolment over time, and so cohort participation in tertiary education has also gone up. Given that as a backdrop, would the Minister not agree that there is room for us to improve further, in the sense that for our overall population, we expect about 70% to go through tertiary education, should we not aim to do the same for students from the lower-income households? That is the first clarification. My second clarification is for the Senior Minister of State, Mr Iswaran. He has given very comprehensive responses on SUTD, SIT, ITE, and also on PMETs and MOE's role. But his response on the tie-ups with foreign institutions was very general in nature. Would he not agree that it would be beneficial for the general public to have a deeper understanding of the value of such tie-ups, and could he give us a little bit more specific information, perhaps not today but on another occasion?”
“For some years now, several MPs and I have asked for early childhood education to be made more affordable. Therefore, I am happy to note that the income ceiling for the Kindergarten Financial Assistance Scheme (KiFAS) has been raised to $3,500 a month. I wish to thank MOE for making this shift. There are three more areas I think need further attention. First, how is MOE strengthening and improving the quality of early childhood educators? Specifically, can a NIE-type of set-up be considered to assure parents of the quality and consistency of their training? Second, given the plethora of pre-school centres in the market, how do parents know if they meet certain standards? How can we take the guess-work out of parents’ considerations? Third, one way to uplift the quality of the pre-school sector is through innovation. What is the record of innovation so far and what is MOE doing to further promote it? Pre-school education”
“Will we be incorporating these elements into our liberal arts college? And although liberal arts college originated in Europe, it is very much associated with the United States today. What will our concept and modus operandi be for this college? Will we be following the US system closely as it is a collaboration with Yale? Support students in high quality private education institutions”
“It involved cash injection of £65.1 million from the UK government and £16 million raised from private sources. In 2003, the Guardian noted that "the collaboration between MIT and Cambridge has been something of a disappointment so far". It also observed that it was hard and I quote, "to deflect the ongoing suspicions that CMI remains a better deal for MIT than Cambridge, not least because £13 million of public money has already departed Stateside to fund US research". Sir, how much does it cost to have tie-ups with foreign institutions like MIT and Yale? Has MOE done a thorough study to ascertain the value of such tie-ups? What steps are taken to ensure that the monies are well spent from Singapore's perspective? Finally, as our economy transforms, skills become obsolete more quickly. What is the MOE's role in the overall push for Continuing Education and Training? What are the plans in support of PMETs in particular? Liberal arts college Assoc. Prof. Fatimah Lateef (Marine Parade): Mr Chairman, Singapore has decided to have a liberal arts college – a bold and strategic investment in education of the future. A liberal arts college is one with a primary emphasis on the liberal arts and sciences with an exposure to a wide range of academic subjects, including traditional humanities. Liberal arts education will impart broad general knowledge and help develop the general intellectual capacities in contrast to the professional, vocational and technical education curriculum. The three main characteristics of a liberal arts education will include a smaller size than standard universities, a live-in residential facility and, of course, typically a two-year exploration of the liberal arts and general knowledge before embarking on a major subject.”
“Sir, I wish to declare my interest as a member of the Boards of the Nanyang Polytechnic and the Singapore University of Technology and Design (SUTD). MOE has announced many new additions to the higher education landscape. What changes can students look forward to in the university, polytechnic and ITE sectors in the next five to 10 years? Can MOE provide an update on the SUTD and SIT and how they are benefiting Singaporeans? There has also been an increasing number of collaborations between local universities and foreign institutions. The NUS has collaborations with Duke University Medical School, with Boston University for a law degree and is about to have an agreement with Yale for a liberal arts college. NTU has a tie-up with Imperial College London for a medical school also. Proponents tout the benefits of tapping the partner institutions' branding, expertise of the faculty and experience of its administrators. Detractors, such as Pankaj Jain, former director of the University of Leeds, are less enthusiastic. He says institutes in the United States and the United Kingdom are bankrupt right now. State assistance is dwindling and domestic demand is stagnant. In such a scenario, they all want foreign students but do not have money to set up campuses overseas. Top-notch institutes are also unlikely to adopt this practice as it will dilute their brand value and may also result in fewer number of students reaching their parent campuses. Instead, they prefer to export their expertise through collaborations. Moreover, results for some universities collaboration have been mixed. Take the Cambridge-MIT Institute, a partnership between the University of Cambridge and the Massachusetts Institute of Technology which was supposed to be a six-year programme between 2000 and 2006.”
“Sir, I do not think that schools can teach everything nor can they replace the role of parents in character development, but I do think that we can equip our students with competencies to deal better with future uncertainties. Therefore, these suggestions need to be studied further. I hope the MOE will do so in due course. Let me now turn to teachers. MOE had announced plans to expand the teaching force. Given the stiff competition for talents in our tight labour market, how does MOE intend to do so while maintaining the quality of the teaching service? Finally, one important advantage for Singapore to retain for the future is our bilingual and bicultural edge. A thorough review of the teaching of mother tongue was recently concluded. One of the Mother Tongue Language Review Committee’s recommendations identified the community as a key partner to promote learning and usage of Mother Tongue Language as a living language. Can MOE provide more details on how the $45 million would be made available for schools and the MTL Learning Promotion Committee to do so?”
“Mr Chairman, education is all about investing for the future. Last year, MOE laid out plans to strengthen our students’ 21st century competencies. Can MOE provide an update on efforts to develop our students holistically, in particular, the emphasis on non-academic aspects of the curricula? I have two suggestions for the MOE to consider for the future: In the recently published "Hard Truths to Keep Singapore Going", journalists asked Minister Mentor about his "carbon footprint". I noted his simple, down-to-earth lifestyle. The jacket he wore, for instance, was nearly two decades old. Increasingly, our world will have to deal with the profligate ways in which we consume resources and the consequences of such behaviours. One "competency" we may need to cultivate is "Awareness of Sustainable Living". Cultivating this awareness early could help our students develop an affinity and edge in the many "green" jobs to be, created in the future, and to themselves live more sustainably. Second, last November and December’s series of youth violence incidents had led to media editorials attributing teen violence to the prevalence of computer games, particularly those with many violent actions. There were also reports on youth gaming addiction, which analysts opined, affected youths’ mental development and interpersonal relations. Gaming addiction is just one example of the many socially-risky types of behaviour youths could develop. We cannot prevent them from trying out everything but perhaps we need to grow a "Risk Management" competency so that young Singaporeans can learn to spot risks in their lives and have the skills to manage them.”
“However, I have the impression that many DSA places are taken up by Gifted Education Programme students or those who have taken the trouble to prepare for the many admission tests. It sounds to me like it is a pre-PSLE and it makes me wonder how could poorer students have the resources to keep up. Is it time for us to refine the DSA? Another concern is that of cost. How does MOE ensure that quality education, especially at the tertiary level, remains accessible and affordable to all Singaporeans regardless of financial background? Finally, what more can be done beyond financial assistance to boost the chances of students from low-income families? One practical issue, for example, is how CCA schedules and remedial classes are organised. I discovered to my horror that having three children in primary school at the same time means three different sets of after-school timetables to deal with. Some of my homemaker friends say they are no different from taxi-drivers, ferrying kids around, including the fact that they also do not get CPF! Not many people can afford to have a stay-at-home spouse to handle non-standard transport arrangements. There are other programmes which are very good but which could also impose burdens on lower-income families, for example, when schools arrange overseas trips to places like Europe. I feel that as a system, we should become more sensitised to the needs of lower-income families, and to be as inclusive as possible when giving opportunities. Education is the single most important means of providing social mobility in Singapore. It is core to our national value of meritocracy. So I hope to hear the MOE’s views and commitment to strengthen all aspects of our system to promote and not erode social mobility. 1.”
“Singaporeans are also concerned about declining mobility. A recent article by Assistant Professor Irene Ng of the National Univeristy of Singapore has suggested that our education system may be perpetuating social immobility. In other words, somehow because of design, we have made it more difficult today for students from poorer backgrounds to do better than those from richer backgrounds. I would like to know if this is true. Can the MOE share any trend data and analyses that would shed light on this issue? One specific concern I have is the use of PSLE scores for secondary school posting. While it is fair and meritocratic, there are a number of undesirable consequences. First, it is a very high-stakes examination for 12-year-olds when, in fact, it should serve mainly as a milestone check on a child’s progress in his education journey. Should we allow, for example, some shifting around after Secondary Two to give some allowance for late bloomers? Second, there is certain value in putting students of comparable abilities together to facilitate teaching. But we have to be careful not to give young Singaporeans, especially the very bright ones, the idea that everyone else is like them in terms of intellectual abilities. For many people, lifelong friendships are formed in secondary schools. For this reason, I wonder if we should tolerate some “untidiness” in secondary school posting, perhaps a combination of PSLE scores and some other criteria to have more mixing of people of different abilities. Third, the policy of Direct Schools Admissions (DSA) was introduced so that students with other gifts can gain admission to popular schools even if their PSLE results might not have allowed them to.”
“Furthermore, there are financial schemes to help students from poorer homes. Self-help groups run many programmes to give them a further leg up. Our education system is as equitable as it gets. In that sense, it provides all Singaporeans equal opportunities to excel. However, no one would be so naïve to think that students from higher-income families do not enjoy some advantages, such as access to enrichment and tuition, information and exposure. For primary school enrolment, the parents’ income levels have a greater influence. It is not uncommon to hear of successful Singaporeans moving, buying or renting a home to be near a primary school of choice. The key question is whether these advantages are so significant that Singaporeans from poorer backgrounds cannot do better than those from richer backgrounds. In particular, does the parent’s ability to get his child into a primary school give him or her an unfair advantage at the all-important PSLE examinations and thereafter? In Britain, parents who are able to pay send their children to private schools like Eton and Westminster. Prime Minister David Cameron noted that Oxford and Cambridge Universities take in more students each year from just these two schools than from among the 80,000 pupils who are eligible for free school meals. What about Singapore? Do enough pupils who start at the bottom move up and out? I think this is a very important question for the MOE to address. Certainly, what would reassure Singaporeans is not one or two individuals who overcome the odds, but empirical evidence that good numbers of students from low-income households are making it to top secondary schools, making it to tertiary institutions and winning scholarships.”
“Sir, I beg to move, That the total sum to be allocated for Head K of the Estimates be reduced by $100. One weekend last year, two boy scouts from Raffles Institution came to my home to offer their services during the annual Job Week. While chatting, I found out that one of them had a doctor father and homemaker mother. The family lived in a house in Cairnhill. They were quite well to do. The other boy lived in a HDB flat in Jurong West. Both his parents work but he was not sure as what. They were not poor but clearly of more modest means. Without even asking, we know that both of the boys made it to RI on the basis of their outstanding PSLE performance. In many other countries, we would not have been able to make such an assumption because entry to so-called “top” schools is not always by merit. Instead, it would depend on the size of your father’s wallet or scope of his influence. Like most Singaporeans, I am very proud that our education system is like that. The message to students is that all you need to do is to work hard, because the system will let you go as far as you are capable of, regardless of your family background and circumstances. Does this message continue to hold true today? To a large extent, the answer is “yes”. Whether you live in a bungalow or rental flat, it is the same PSLE examinations that you have to clear, same “O” levels that you have to take to determine which Junior College or polytechnic you can be enrolled in, the same “A” levels that will decide how much choice you have for university and course selection. All teachers are NIE-trained and paid competitively. All schools enjoy substantial funding and good facilities.”
“Sir, Prime Minister Lee Hsien Loong in his January commentary in Bloomberg Business Week said the US-China relation was the most consequential relationship in the world today. He also noted the significant frictions in that relationship, notably over exchange rates. The Prime Minister made three visits to the United States last year. He also made an eight-day working visit to China. Newsweek magazine recently gave Prime Minister the title "the middleman", saying that Singapore managed to carve out a role as a friend to all the big powers in the region. I would like to ask the Minister for his views on US-China relations, the implications on Singapore and what opportunities he sees for small states like us to secure our interests in the international arena. Singapore-China relations”
“You will not find many grand statements in our Budgets, very few flashy projects and yet the evidence of achievements is all around us. There are very consistent themes in all these Budgets – recognise the challenges ahead, be cautiously optimistic, do not over-tax, use resources wisely, save for a rainy day, provide relief in tough times, keep investing in training, skills and capabilities, build for the future, capture growth opportunities, help workers and businesses stay competitive, keep growing the economic pie, and always share pains and gains with the people. It has not changed very much. And it feels almost uncanny. You can change the Finance Minister and adjust the numbers by a factor of 10 or 100, and their Budget speeches still sound quite alike! But as a Singaporean, I think the real message is that each Budget on its own does not transform our country, but consistent, tenacious and thoughtful management of our Budgets by a serious and caring Government will help to make Singapore a much better home for all of us year after year. It is a uniquely Singaporean way that we can all be very proud of. Madam, like his distinguished predecessors at various junctures in Singapore’s history, Finance Minister Tharman has delivered an outstanding Budget – quite similar to past Budgets but nonetheless outstanding. It is a Budget that carries on the good tradition of prudence and yet introduces innovative ways to help Singapore transform. It cares for and shares with Singaporeans, and also invests in strategic areas like the economy, education and eldercare. It is a Budget that is smart but also has lots of heart. I can say confidently that this Budget has the full and resounding support of the Labour Movement and all of us in the unions.”
“I was three years old then, and Singapore was a fledgling nation. Finance Minister Hon Sui Sen was new to politics and was delivering his first Budget, having taken over from Dr Goh Keng Swee. Mr Hon outlined four "dark clouds" hanging over Singapore then – and they will sound a bit familiar – inflationary pressures, state of the US economy, accelerated withdrawal of the British military presence and shrinking entrepot trade. In particular, the British withdrawal could take some $350 million out of the GDP then, which was quite a lot. Nearly 17,000 civilians and 2,000 locally enlisted personnel would lose their jobs, bringing unemployment to 5%. This was 1971. The SAF at that time also needed $300 million to expand. Mr Hon was keen to develop our tourism. Plans were underway for the Jurong Bird Park, a zoo – not in Mandai but in Seletar – and a cable car system from Mount Faber to Sentosa. An American consultant estimated that it would cost $300-$400 million to develop Sentosa. This was 40 years ago. That year, against all expectations, Mr Hon did not raise taxes. He counted on the record number of very large industrial projects to raise tax revenues to fund our development. He gave $9 million to develop medical specialisation in our hospitals and to boost the re-planning of public hospitals. With the $17 million in payroll taxes, he allowed reimbursements to industrialists for approved training or apprenticeship schemes in skills that were in short supply. He also cautioned Singaporeans that year that the previous year’s 15% growth was not likely to be repeated. That sounds almost like this year. What is the legacy of these Budgets in the 10, 30, 40 years that have passed?”
“4 billion tax relief package for firms and individuals, $2 billion worth of reliefs for individuals. Cabinet Ministers took a pay cut of 17.3% to signal the gravity of the economic situation facing the country and the need for wage restraint. Salaries of other political appointment holders and senior civil servants as well as allowances of Members of Parliament were reduced by 10%. In light of the rising jobless rate – which was expected to hit 4.5% at the end of the year – the Government also set aside $809 million in the form of employment assistance schemes for workers and executives. What if we roll back the clock 30 years earlier to 1981? It was Mr Goh Chok Tong’s last Budget as the Finance Minister. Mr Tan Soo Khoon said it was " ...difficult to throw brickbats at the Minister this time". So it was also a very good Budget – $9.6 billion. It included a reduction in the highest marginal tax rate for individuals from 55% to 45%, which is still a lot higher than what it is today. It is hard for me to imagine people in that tax bracket paying 45% taxes then, much less 55%! And the reason for the cut – "… to promote individual drive and enterprise". He also gave $10 million, which in those days must have been worth a lot more, to fund more R&D in public institutions. Senior Minister Goh said then: "It is our ability to enlarge the economy through intelligent hard work which allows us to reduce tax rates even as Government expenditure increases. We must press on vigorously with economic restructuring. We must bring about a qualitative change in economic activities by the end of the decade." With your indulgence, Madam, let me go even further back to the Budget of 1971 – 40 years ago.”
“Some £11 billion of welfare cuts would also be made by 2015, not so far off, and these included cuts to child-benefit rates and housing benefits. Madam, I am not making any prediction about the Finance Minister’s next promotion after this year’s Budget bonanza, and what happens after. There are just two points I wish to make. As the UK example shows, without good growth, we cannot increase spending without bankrupting ourselves. The second point is that the price of a bad budget is inevitably paid by people in the form of higher taxes and cuts to public spending, which they have become used to or have come to rely on. Conversely, the benefits of a good budget are enjoyed by the people in the form of sustained growth and societal progress. Therefore, in my view, Singaporeans should evaluate the Budget on what it does for them today and in the future, and not whether it favours any political party in the short term. That is the only worthwhile yardstick. So, how do we know that this Budget will benefit Singaporeans in the future? Interestingly, there are useful lessons from the past. I did a bit of digging and found that in the Budget of 2001, which is a decade ago, Dr Richard Hu, who was then Finance Minister, had announced in February that year that he had a very good budget. It produced headlines such as "$1 billion bonanza for businesses", "Generous tax cuts for individuals". And this one can also apply this year, it says "Goodies for everyone: Generous to a fault". This was a decade ago – in 2001. Unfortunately, despite the good Budget, the economy went into a tailspin after September 11. And as a result, the Government had two rounds of off-Budget measures. The second round announced in October was worth some $11 billion. It included a $2.”
“4 billion, and that was a surplus of 1.6% of the GDP then. But between the years 2001 and 2005, public expenditure rose by 4.4% in real terms every year, nearly double the rate of economic growth over the same period. So, in fiscal year 2004/2005, it chalked up an estimated deficit of £34.4 billion, which was 2.9% of the GDP. This was a huge deterioration in its structural balance – about £50 billion over four years. The Labour government really went on a spending spree. The then Chancellor of the Exchequer (Finance Minister) was Gordon Brown. And in 2005, the Economist magazine commented that – and I shall quote this – "Gordon Brown's fiscal imprudence will help him into 10 Downing Street (the Prime Minister’s residence), but he'll pay in the end", and they noted that "Prime Minister Brown will have to sort out the problems that Chancellor Brown created". Well, true indeed, the Labour Party led by Prime Minister Gordon Brown eventually lost the elections and the right to govern. So, a spending spree, a so- called "election budget" can cost a party in power, rather than help it, contrary to what the public thinks and contrary to what the opposition claims. The key is really whether the spending is something we can afford, that really benefits people not just for the short term but also for the long term. As it turns out, in June 2010, the newly elected coalition government in the UK announced an emergency budget. In that budget, the value-added tax, which is a consumption tax, was raised from 17.5% to 20%. Also announced were major reductions in government spending which would see over 300,000 civil servants lose their jobs.”
“We really need to do this, otherwise we do not create the conditions for sustained wage growth. And so, continuous productivity, improvement and innovation must become the rule and not the exception. Madam, I would like to shift a little and talk about something else. I note that the Finance Minister has taken pains to ensure two things in the Budget. Firstly, the hongbaos totalling $3.2 billion are slightly less than the $3.4 billion investments for the future. The second point is that these commitments were made after we have returned $4 billion to the reserves. The news headlines have been mostly positive and they stand in sharp contrast to other countries' budget announcements. Take Ireland, for example. When their budget was unveiled in November last year, the headlines were gloomy. The Daily Mail said, "Stricken Ireland cuts spending to the bone", while another paper quoted former Prime Minister Brian Cowen – his government lost the elections after such a drastic budget – as saying that "No one will be sheltered from that budget". One other headline went so far as to say, "Fear and anger as Ireland prepares savage budget cuts" – very strong language and not at all happy. Let us move to France. The budget deficit in 2010 was 148.8 billion Euros. The International Herald Tribune called this "A French tradition: Pain in the provinces; As Paris cuts spending, rural enclaves are left to struggle". It is a very gloomy picture, indeed. In comparison, Singapore is unusually successful in managing our budgets. That is something we should not take for granted and why I wish to share a cautionary tale with Singaporeans. This has to do with the United Kingdom. In fiscal year 2000/2001, the Labour government in the UK ran a budget surplus of £15.”
“Mdm Deputy Speaker, thank you for allowing me to join in the debate. I would like to focus on one aspect of the Budget which was rather unexpected. This was the announcement of planned increases in foreign worker levies. I have observed many different reactions but would just like to highlight one. Madam, there is a stubborn refusal by some businesses to embrace the productivity challenge. Their common refrain is that there is a limit to how much we can automate and so tax credits for productivity and innovation are not very useful. I feel quite sad that these businesses have already made up their minds that there is no solution. I agree with Deputy Prime Minister Teo that there is more to productivity than automation. Productivity is not just about "same revenue, lower cost". It is also about "same cost, higher revenue". So, we can have two shops, for example, with the same shop space and same number of workers, but if one shop's products and services generate higher revenues than the other, then it is more productive in terms of the use of labour and space. Quality matters to customers, not just price. So do services, speed, capabilities, design, and so on. To deliver better capabilities and quality, staff must be better trained and equipped. Jobs need to be redesigned, industries need to be redeveloped. The Deputy Prime Minister earlier shared many examples of companies and industries that have already responded to the challenge. We need many more to come on board to fundamentally transform our economy. It is really important that we recognise it is not just managing the bottom line but growing the top line, and that is why the labour movement advocates "cheaper, better, faster" as an economy, and not just "cheaper" only.”
“Mr Speaker, Sir, I thank the Minister of State for the reply. I came across a household where the sole breadwinner – the father – told me of an instance where his child was receiving student care subsidy. He subsequently received a salary adjustment. He got more pay but as a result of that, the student care centre stopped giving him the subsidy. So, he said that, "I ended up getting $200 more pay but I also ended up with no subsidy, so in essence, I did not experience a pay increase." Could MCYS look at, perhaps, tiering the subsidy so that the family still feels that it did have improved circumstances and not have the subsidy taken away?”
“Thank you, Senior Minister of State. I recall that when I was in university and there was a round of fee increases, it applied only to new cohorts. I am making this appeal to the MOE to consider such a practice for the polytechnics. I do not know whether the universities still do that, but I am making a case for such a practice, if it has not been in practice, then to be in place. It gives assurances to parents whose children are already enrolled. Sir, I would like MOE to consider that.”
“At this stage, about half the students in the polytechnics avail themselves of this range of facilities. We will continue to be ready to make them available as required. There is no resource constraint on that score.”
“Mr Speaker, Sir, I have three supplementary questions. Firstly, given the concerns over rising inflation, could the increases have been further delayed, perhaps for a year? Secondly, could the fee increases have been applied to new cohorts only, in other words, for students who are enrolled from this year onwards? And, thirdly, will financial assistance be expanded in connection with this round of fee increases? Mr Iswaran: Mr Speaker, Sir, I thank the Member for her questions. Could the fee increases have been delayed? Of course, in principle, yes. But I think it is a balance between what is happening on the ground, in terms of the needs of the polytechnics operationally and the costs that they are dealing with, and the plans they have to enhance their capabilities versus upping the burden on students. In this case, if Members look at the order of the magnitude of the increase, it is about 2%. It has gone up from about $2,100 to $2,150, so it is a $50 increase, or about 2%. In the case of most students, it should be within their means to meet that increase. Secondly, would it be preferable to apply the increase only to new cohorts versus the entire enrolment? The answer is what the past practice has been and maintaining the equity and the treatment. The treatment is always being that the entire enrolment is affected by the fee increase. If we now change the policy, there will be questions of inequitable treatment. Thirdly, the Member asked for assurances on whether we are expanding the financial assistance scheme. As Members are well aware, we have a whole slew of financial assistance measures, ranging from loans to bursaries and other community-based support measures.”
“Mdm Deputy Speaker, I thank you once again for allowing this debate. I ask all Members to give this motion your strongest support. Thank you very much. Question put, and agreed to. Resolved, That this House reaffirms its commitment to inclusive economic growth and calls on the Government to continue doing more to support low-skilled and low-wage workers so that all Singaporeans may share the fruits of our prosperity through better skills, better jobs and better incomes. ADJOURNMENT Resolved, "That Parliament do now adjourn to a date to be fixed." – [Mr Mah Bow Tan]. Adjourned accordingly at Twenty-four Minutes past Six o'clock pm to a date to be fixed. APPENDICES”
“Mdm Ho Geok Choo shared some very heartwarming examples of how the grassroots leaders are taking initiatives and, in so doing, demonstrates self-reliance. I want to thank Minister Gan, firstly, for saying that his Ministry will consider all our Workfare related suggestions. I thank him and at the same time I urge him, where possible, please introduce them – or if he is going to accept the changes, accept them sooner rather than later. Next month will not be a bad idea. So, Madam, in conclusion, let me just share what this debate has achieved. Firstly, I think it has shown that the issue of inclusive growth is very close to our hearts. And that is a good thing. Secondly, I think there has been a consensus that we have, as a nation, made very good progress and this gives us hope that the inclusive society we want to create together, we want to build together, can be a reality. Ms Jessica Tan calls us the "improbable nation". I think we should continue to repeat and continue to do things that other people think impossible because that is what makes us special. Thirdly, I think at the same time, we all recognise that this effort of building an inclusive society is going to be a long-term effort. I really like what Mr Yeo Guat Kwang said, "一步一脚印". With one single step, you leave one imprint. I think what this means is that there is no shortcut. Only if you take a step, you can leave a print. I thank him for sharing that thought with us. If we take shortcuts, such as the minimum wage, a quick fix, we will eventually shortchange Singaporeans. Finally, I would just like to say that there has been no lack of ideas. I thank Members for heeding my call to be energetic, focused and constructive.”
“If we deny them the opportunities here, there is no shortage of options outside of Singapore. But not so for those at the bottom. Moreover, it makes no sense whatsoever to pull back some because their loss will not cause anyone to gain. In fact, the actions to slow down the top will likely slow down the bottom even more. So we could have a situation where we slow the top, but the bottom goes further down and what we have is a further widening of the income gap. Madam, I think that while we want to be mindful, and we must always be mindful of the income gap, we must not forget something more fundamental. In fact, I think the Member Calvin Cheng pointed out that it is not relative poverty that is all-important, we have to look at absolute poverty. I agree with him that what we should not take our eyes off is the bottom line for the low-skilled, low-wage, low-income Singaporeans. We should watch the bottom line for them. If we really want to help them, raise their skills, raise their productivity, raise their incomes in a sustainable way. That is being inclusive. That is why I have provided five suggestions for the Government to consider. I shall not go through them again. I would like to point out that several Members have given other constructive ideas. Mayor Zainudin talked about the need to widen the reach of the best sourcing initiatives (BSI) to more sectors. Ms Audrey Wong expressed the hope that more Government agencies and companies could adopt the BSI. Mr Seng Han Thong talked about the taxi industry workgroups' own initiatives. Mrs Mildred Tan and Mr Terry Lee suggested that we bring training to the workers to overcome their time constraints. Ms Denise Phua talked about the importance of getting Singaporeans with mild disabilities on board as well.”
“I agree with the Member Mr Heng Chee How that it is not wise, "not clever" in his words, for us to try the policy of this nature. That is also why the Labour Movement champions sustainable growth through the economy becoming "Cheaper, Better, Faster" and inclusive growth through programmes like the IGP, both of which make sure that wage increases are underpinned by skills and productivity improvements. Minister Lim Swee Say gave strong reasons why in Singapore we can have the "same-same" problems but a different and a better solution. I agree with him. Mr Gan Kim Yong spoke briefly that the foreign workers levy would have to be adjusted; if I did not hear him wrongly, I think he said it is going to go up further. Why? To tilt the balance in favour of low-wage workers in Singapore, our Singaporean low-wage workers. I thank him for supporting them. Madam, several Members spoke on the widening income gap. Assoc. Prof. Paulin Tay Straughan, while praising the *Cols. 2497-2498. Government's efforts, wondered how it was possible for us to ensure that no Singaporean is left behind. Ms Audrey Wong spoke about the importance of preserving our social fabric. Mr Viswa Sadasivan expressed concern about the potential harms of different segments being marginalised. Ms Irene Ng talked about polarisation of society that could happen and how it would undermine trust. Like them, I too am concerned. Some believe that the only way to close the income gap is to somehow hold back growth at the top, while trying to move up the bottom, so close the gap. But will this work? In a stable society where education and job opportunities are fairly equitable, those who rise to the top are likely to be more skilful, more resourceful, more in demand, perhaps more hungry and sometimes more fortunate.”
“However, in reality, things are not so simple. Many experienced Members remember that during the period between 1979 and 1981, the Government implemented a high-wage policy. My colleague Mr Heng Chee How also mentioned this high-wage policy earlier. At that time, our economy was not as diversified as it is today and productivity levels were generally lower. Hence, when the policy was implemented, initially we did see some increase in productivity. However, the policy is a blunt tool. It could not differentiate between industries which were doing well and could afford to pay higher wages, and which industries were facing difficulties and not able to do so. In addition, productivity levels varied in different sectors. To require companies across the board to raise their wages uniformly resulted in some companies, especially SMEs, losing their competitiveness. This contributed to an economic recession. The minimum wage system has the same shortcomings. It is a pro-worker, anti-business policy, as my colleague Denise Phua has rightly pointed out. What we want is a pro-worker, pro-business mechanism. (In English ): Mdm Deputy Speaker, from the high wage policy of 1979-1981, there are two key lessons to be drawn: The first is that blunt instruments caused rigidities and should be avoided especially when our modern economy is so diversed. The second lesson is that wage increases should follow skills upgrading and productivity improvements, and not the other way round. Minimum wage is blunt. It is unrelated to productivity and it will not easily be able to discriminate across sectors, across companies within the same industry. It has the same problems as the high-wage policy that even though was officially stopped, had generated a momentum that was hard to draw back.”
“That is important. Ms Denise Phua pointed out that a minimum wage will backfire. It will cause the low-wage workers, whom we are trying to protect, to lose their jobs. Minister Gan Kim Yong shared some data of what is happening in Hong Kong – that estimates of up to 100,000 workers could lose their jobs. I think these are very strong arguments for us not to go down the path of minimum wage. Mr Low Thia Khiang gave suggestions on Workfare. Since he is not advocating minimum wage but chose to offer suggestions on Workfare, I think it is quite reasonable to conclude that he thinks Workfare is better at least for now. Mr Heng Chee How asked a very good question on minimum wage. Why go for minimum when we should go for best? I agree with him. Minister Lim Swee Say took pains to explain to us how a minimum wage could end up as a maximum wage. There is a consensus forming here on the difficulties associated with minimum wage. What is infinitely clear is that no one has argued definitively for minimum wage. No one is prepared to make an outright call to the Government to implement minimum wage because no one is 100% confident, in fact, not even 50% confident perhaps, that it is better than what we have today. That clarity and consensus has emerged from this debate and I think it is a very useful clarity to have. Mdm Ho is no longer here but she mentioned that minimum wage is fashionable but not practical, and I think that is precisely what it is: sounds fashionable, looks good but not terribly practical. Madam, I would like to speak briefly in Mandarin. (In Mandarin ): [For vernacular speech, please refer to Appendix A *.] Some people believe that imposing a minimum wage can motivate the employer to upgrade his workers' skills.”
“I think to say that the work that they do offer only hope is a great disservice to them and I want to say this so that Members do recognise the work of not just the e2i colleagues but many others in the WDS, in the UCCW, in the MOM, in the WDA, in the CDCs, and the self-help groups. So many people in Singapore are working together to make sure that this group of low-wage workers, low-income families benefit from growth. I am glad that most Members supported the view that growth has been inclusive. There has been a robust debate on minimum wage. I think it is fair to say that most Members agree that Workfare is a better alternative. Ms Jessica Tan pointed out that Workfare does not discourage employment. She shared the very important point that inclusive growth must mean not just benefit-sharing but also participation. I fully concur with her. Mr Calvin Cheng asked a very pertinent question of minimum wage. Who pays, he says? He says it is not a magic medicine, it is more like a tax. I agree with him. This was a point I made also in my opening speech. He pointed out that small businesses will suffer and, in that sense, it is not inclusive at all. I agree with him too. Mdm Halimah Yacob shared with us some very useful studies conducted by the ILO. One particular study that she shared, I think, bears repeating. She said that this study shows that the workers who cannot get jobs at minimum wage are basically driven underground. Is this something that we want to do? I think the answer is clearly "no". Far better for them to remain within the formal workforce. Mdm Halimah also pointed out that the study shows clearly that if we really want to help low-wage workers we must put job creation at the centre of policy. So, we must put job creation at the centre of policy.”
“Mdm Deputy Speaker, first, let thank the 16 Members and the two Ministers who have spoken on the motion. They have made many useful contributions to the debate and I will attempt a brief summary. First, many Members supported the view that growth has been inclusive. In addition to better jobs, better wages, Mayor Zainudin highlighted the beneficiaries of the ComCare Hope scheme. Assoc. Prof. Paulin Straughan marvelled at Pinnacles, a public housing project right smack in the centre of the business district. Ms Audrey Wong talked about the job-re-design efforts that have helped sectors such as security. Mr Yeo Guat Kwang talked about the workers in the services sector who have benefited from the Customer-Centric Initiative. Mr Gan Kim Yong shared various forms of Government assistance to low-income families – through housing, through medical care. The Member, Mr Low Thia Khiang, earlier in his speech, suggested that the programmes that the Government have put in place offer only hope but, perhaps, not such concrete improvements. I beg to disagree with him with all due respect. For the 32,000 workers that e2i has helped to find new jobs, for the 15,000 workers that are benefiting from the inclusive growth programme, for the 4,000 workers that have participated in the Best-Sourcing Initiative – these programmes do not just offer hope. They offer a real lift, a real improvement in their circumstances. We should not diminish these efforts. My collegues in the e2i, 101 of them – we just recruited one more today – are passionate about what they do, they put a lot of real effort into it. It is hard work, they get scolded left, right, centre. Jobs seekers who are unhappy; employers who also face pressures of their own.”
“I have provided some arguments as to why I am not for the minimum wage. It would be helpful if the Member could let us know whether he agrees with my arguments or he is not in agreement.”
“Sir, I thank the Member for supporting my motion. Since he talked about the minimum wage, I am not sure I got a clear understanding of whether he is for it or he is not for it. So, perhaps, the Member could help us so that we can sharpen the debate.”
“We do not get discouraged because we bond over the challenge and the finished work is always worth the while. Building an inclusive society is also a family effort, an effort for all of us in the Singapore family – the workers, unions, the employers and the Government. There are many parts to the future we want to create together. We have to coordinate our efforts and work towards a common vision. We have to put pieces together one by one, let everybody play a part and also not to give up easily. Most important of all, we keep building, building and building until the picture is done. Therefore, Mr Speaker, I urge Members of this House to strongly support the motion. Question proposed. 1.58 pm”
“This encourages families to work together to improve their circumstances. The fourth suggestion is to promote best-sourcing and minimum skills. To raise the pay of low-wage workers, there must be a much higher expectation on quality and insistence on minimum skills. We need to reduce tolerance for shoddy service, poor workmanship, sub-standard delivery. The Government, through its procurement practices and regulation, can help to tilt the balance in favour of best-sourcing and minimum skills in sectors where cheap-sourcing is rampant. The fifth and the final suggestion from me is to leverage on the Inclusive Growth Programme (IGP) to benefit more. The IGP was initially conceived as a pilot programme to target the bottom 20% of wage earners. With the momentum built up, it is worthwhile for the Government to commit more resources. Funding support today allows for up to 25,000 low-workers to benefit at the end of two years. We should extend the IGP to at least 100,000 low-wage workers within five years. Mr Speaker, Sir, from the perspective of the labour movement, growth in the last few years has been inclusive. Our tripartite approach works. More vulnerable Singaporeans have found jobs. Many low-wage workers are getting better wages. Now is the time to stay on course. As the economy grows, now is the best time to catch the wind and help low-wage Singaporeans do better and for Singapore to become even more inclusive. Sir, when my children were younger, our family used to solve picture puzzles together. Starting from 20 pieces, 50 pieces, progressing to 100, 200 pieces and so on. The more the pieces, the bigger the effort. Over one weekend, we may at best complete a small segment – a corner here, a small patch there.”
“So, this is why, Sir, to top up the incomes of low-wage workers, it is better to have Workfare, which the Government pays for. Instead of burdening businesses with minimum wage, let us get them to help by training their workers, improving productivity and sharing the gains. Let us be pro-worker in a pro-business way. To be effective, our measures must involve the tripartite partners – the Labour Movement, the employers and the Government. There is simply no shortcut to achieving sustained and inclusive wage growth. Sir, to summarise, we are on the right track to achieving inclusive growth. We should persist and not rest until all low-wage workers have been helped. I have five suggestions for the Government to consider so that we can further strengthen inclusivity. The first is to increase the WIS payout when the economy does well. One way to do so is to pay a WIS GDP bonus when GDP growth is good. By doing so, low-wage workers also have something to look forward to when they see others doing well. Let us reward Singaporean workers who have kept faith with the Government. Show them that Workfare works for Singapore and for them. My second suggestion is to increase the cash to CPF ratio. The current ratio of cash to CPF in the Workfare payout is 1:2.5. A 50-year-old worker drawing $1,000 monthly will get $1,400 from Workfare annually and $400 will come in the form of cash, $1,000 will go into his CPF. This means that he gets $33 in cash every month. I think the Government should raise the cash component to provide a stronger incentive for the workers to stay in work. My third suggestion is to introduce a Workfare Family bonus. A WIS Family bonus can be considered if two or more family members in the same household receive Workfare in the same period.”
“Sir, to be meaningful, a minimum wage must force some employers to pay more than the market rate for labour. As a result, it will have the same effect as a tax on employment. In fact, if this is the minimum wage, and this is the market clearing rate for labour [indicating ], the lowest-wage worker attracts the highest "tax". Will this help previously unemployed Singaporeans like Mdm Goh get jobs at minimum wage? I am not so sure. To survive, some of these workers will choose to work illegally below the minimum wage, just as some choose to forgo CPF today. Are we to blame them for doing so? Companies that do not wish to engage in the illegal practice of paying below minimum wage and find it too costly in Singapore will close shop or relocate. Restructuring and relocation is already happening. It has to. Introducing a minimum wage will accelerate the pace without sharpening our competitiveness. Local SMEs, and we must remember local SMEs employ 60% of the entire workforce which may be too small to move out, will face even greater pressure. If they close, more Singaporeans will be thrown out of work. Will these workers find new jobs at the minimum wage? From whom? I am not sure about this at all. Does this mean then that we are satisfied with the low wages of some workers today? Of course, the answer is "not"! We are not satisfied. We can and must do more to help them get better pay. But if wages move ahead of productivity gains, our unit labour costs will go up. When that happens in Singapore faster than elsewhere, we will lose competitiveness. This will put at risk the jobs of all Singaporeans, not just the low-wage workers whom we are trying to help.”
“Already, 166 projects have been lined up. They include projects in manufacturing, hospitality, food and beverage, retail, logistics, aerospace and many more. As the projects are implemented, more than 15,000 workers will benefit. What is even more encouraging is that the vast majority of the workers, 86% to be exact, will experience wage increases of more than 10%. In fact, seven in 10 or 10,500 Singaporeans will see wage gains of 16% or more. These are real Singaporeans in real jobs, getting a real lift. And this is what inclusive growth is all about. Against this backdrop, my colleagues and the labour movement have kept a close watch over the debate on the minimum wage. Several people have spoken up in favour of it. They argue that it will "boost wages and morale" and encourage lower-skilled Singaporeans to seek out work. Another argues that the minimum wage is less draining on the national Budget than Workfare Income Supplement. Because it concerns the livelihoods of low-wage Singaporeans, the proposal of a minimum wage should not be dismissed too lightly. The supporters of minimum wage are well-intentioned and the idea certainly looks attractive. With a stroke of a pen, we can dictate to employers a minimum salary to pay their low-wage workers. Why are we so reluctant? Within the labour movement, we are clear that Government intervention is needed to help low-wage workers do better. The Government has responded vigorously through Workfare, Best Sourcing Initiatives (BSI) , Inclusive Growth Programme (IGP) and others. So the issue is not whether the Government should act but rather, how it should intervene to be effective. The real question is: Would minimum wage work better than all the other programmes already in place?”
“Business is expanding and manpower is stretched. The company decided it must raise productivity. Each of its 55 injection mould machines has 24 cavities. *The motion also stood in the name of Mr Zainudin Nordin. If it can bring in a more advanced process with new machines, each with 42 cavities, it can double the output per cycle and increase monthly output by 23% with the same manpower. The company is committed to share its productivity gains with the workers who will be trained to operate the new machines. As a result of this IGP-supported project, 368 local workers can expect, on average, an increase of 16% in annual wages, through a mix of built-in pay and bonuses. One unexpected project involves an SME operating a spa business. Located in the heartlands, Epi Treatz Pte Ltd employs about 15 Singaporeans at any one time. As the customer base grows and sales increase, existing manual processes to manage customer information, inventory and even commissions to sales staff are no longer adequate. The IGP supported Epi Treatz to implement a salon management system. After training, the same administrative staff can handle a higher sales volume efficiently. As a result, staff can expect an annual wage increase of 13%. Epi Treatz is located in the East Coast GRC. If Members would like to have the company's address, I can give it to them. Sir, Seiko Instruments and Epi Treatz are good examples of inclusive growth. As the economy expands, there is more output from production lines and more consumption of services of all kinds. Companies across many sectors – large and small, local and foreign – achieve business growth, and workers gain through better skills, higher productivity and higher wages. IGP is only five months into its implementation.”
“On top of that, she receives Workfare Income Supplement of $2,100 per year. Since the Best Sourcing Initiative was launched in 2006, more than 4,000 low-wage workers like Mdm Wong have benefited. My colleague Mayor Zainudin who heads the NTUC's Unit for Casual and Contract Workers which has been spearheading the BSI will say more about the progress they have made. Sir, besides cheap-sourcing, another reason for some jobs paying persistently low wages is stagnant productivity. There are many contributing factors such as poorly-designed work processes and outdated equipment. Sometimes, businesses expand by simply adding new headcounts instead of investing in multi-skilling or re-skilling of their workforce. The Economic Strategies Committee (ESC) recognised that productivity gains were necessary for workers to enjoy sustained wage growth. As a result of the ESC’s recommendations, the National Productivity and Continuing Education Council (NPCEC) was set up, chaired by Deputy Prime Minister Teo Chee Hean. To support the work of the NPCEC, NTUC launched the $40 million programme – Inclusive Growth Programme (IGP). The push for productivity is not entirely new. As a result, some ask if the IGP will deliver. Can it reach diverse sectors? Can it impact SMEs, which collectively employ 60% of the workforce? I challenged my colleague Ong Ye Kung, who chairs the e2i and is personally championing the IGP, to give me a few examples of IGP projects. Ye Kung provided a long list, one of which is Seiko Instruments, a Japanese multi-national with over 30 years' history in Singapore. Seiko Instruments manufactures and assembles mechanical and quartz watch movements. Today, the Singapore plant is the global leader in the production of small parts. So very high-precision work.”