Lee Boon Yang
Singapore
“6 The other guidelines are that there must be a post office sited within 5 km of every private residential estate and within 1 km of any commercial or industrial estate. MAID LEVY CONCESSION (Applications by the disabled) 32.”
“Madam, can I quickly respond to the point on assistive technology? Certainly this is an area of interest. We cannot say that we have the capability at this juncture but we will certainly look into what is possible and work with our ICT sector.”
“Nevertheless, if the spouse of the homemaker is working, he will be eligible for WIS if he satisfies the criteria. Husbands of homemakers are further eligible for tax relief.”
“Sir, I do not think it is quite correct to say that we always expect our own artists to perform for free or do public service. There are, of course, occasions where we do seek Singapore artists and arts companies to contribute to the national causes. For instance, when we went international for Singapore Season in China.”
“Ms Sylvia Lim asked the Minister for National Development (a) what checks does the Ministry or the National Environment Agency have in place to prevent mistaken payments to hawkers who cease operations due to upgrading works at hawker centers; (b) how did the mistaken payment of $18,000 to Mdm Lee Ah Muey come about; and (c) what will the…”
“While it was also true that initially the reaction or the response of the licensing authority was that foreigners should not participate in such an event at the Speakers' Corner - because there is already an existing prohibition against any foreigners taking part in any activities at the Speakers' Corner - subsequent assessment resulted i…”
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“Without this, no specific effort can be mounted. Meanwhile, he is still on the wanted list of all Interpol member countries. Also, the warrant of arrest against him is still in force. As for the question on securing the return of "the man hiding in Macau after the suicide of the late Mr Teh Cheang Wan", can Mr Jeyaretnam give me the name of the person he is referring to so that I can answer the question?”
“When the SRP was launched in December 1996, as a pilot project, this was in fact one of the main concerns. Will our workers be sufficiently motivated and will they be sufficiently interested in taking advantage of the training opportunities offered under the SRP? The other concern was of course whether employers will support such a programme. As the economic crisis unfolds and as workers become more concerned and worried about job security, we found a matching increase in interest to undergo retraining and skills upgrading by the workers themselves. So we find that workers, particularly those who are low-skilled and with lower education, as can be seen from the figures that I gave earlier on, were very amenable to undergo retraining and skills upgrading courses. Fortunately, over the same period, we also found a greater interest on the part of employers to participate in these programmes because they would be able to minimise the need to retrench workers and, instead of laying off workers, they can send workers for skills upgrading or retraining under the SRP, and Government will come in and assist them with up to 70% grant on the absentee payroll. So it is a win-win situation for workers, employers and the Government too. MR PHEY YEW KOK 7. Mr J B Jeyaretnam asked the Minister for Home Affairs (i) whether the search for Mr Phey Yew Kok has been abandoned and (ii) what success the police have had to secure the return of the man reported to be hiding in Macau after the suicide of the late Mr Teh Cheang Wan. The Minister of State for Home Affairs (Assoc. Prof. Ho Peng Kee) (for the Minister for Home Affairs): Sir, any effort in tracking down Phey Yew Kok is now very much dependent on available intelligence on his exact whereabouts.”
“The employer is asked to co-share the cost of the training, since he is the immediate beneficiary of a better-skilled worker. Workers who have been or are about to be retrenched are, in fact, already a group that is being targeted for retraining under the SRP for employment in new and high growth areas. These include the wafer fabrication and process chemical industries. The NTUC and my Ministry are working with agencies such as the EDB, STB, TDB and PSB to get these industries to recruit the retrenched workers to meet their manpower needs. The SRP will provide such recruits with the necessary training for their new jobs. Sir, the Ministry is also working with the Ministry of Trade and Industry, the NTUC and other economic agencies and industry bodies to expand the spectrum of certifiable courses under the SRP in areas relevant to the needs of each industry. We will provide a wider range of training to meet employers' needs.”
“Mr Speaker, Sir, the Ministry is working closely with the NTUC and the SNEF (Singapore National Employers' Federation) to promote the Skills Redevelopment Programme (SRP). This programme is designed to enhance the employability of the local workforce by encouraging employers to send their workers for skills upgrading and retraining. The aim is to equip the under-educated and lower-skilled workers with certifiable skills to enable them to remain employable in the future. Of the 4,176 workers who have so far benefited from the programme, 70% have Secondary Two education or less. 46% of these workers are above the age of 40, with another 39% between the ages of 30 and 39. Some 80% of the employees who have benefited from the Skills Redevelopment Programme are from the manufacturing sector, as this was the first to be adversely affected by the economic downturn. About 70% of the SRP participants are females, since there are more women in the manufacturing industry. A requirement of the Skills Redevelopment Programme is that the courses offered must lead to national certification. This protects the worker and ensures recognition of skills by the employer. The types of courses offered include preparatory courses such as language and numeracy, Certificate of Competency, National Technical Certificates (NTC) levels 2 and 3, and other certificate courses offered by the polytechnics and the ITE. These skills are required by jobs in various sectors, including manufacturing and services. The current estimate of benefits granted is about $16.7 million, or about $4,000 per worker. This is based on a funding mechanism that subsidises up to 80% of the course fees, and up to 70% of the worker's absentee payroll.”
“Mr Gerard Ee asked the Minister for Communications whether motor repair and service workshops could be licensed to maintain a minimum standard of equipment and trained personnel so that work on vehicles could be properly attended and road safety enhanced.”
“The Employment Service Department (ESD) helps to place job-seekers with employers who posted job vacancies with the Department. Since the beginning of this year, the ESD has been providing employment assistance to between 900 and 1,600 job-seekers per month. In recent months, the proportion of the job-seekers who were retrenched from their previous jobs has increased to about 25% to 30% each month, as compared to a monthly average of 5% in 1997. The ESD has been able to provide job referrals to more than 80% of the job registrants. The majority of job-seekers were looking for clerical, production and general worker positions. Our experience to date shows that about 50% subsequently declined our job assistance as they were able to find employment on their own, or they rejected the job offers by the prospective employers. The reasons cited for rejection include the unsuitable nature of work, working hours, location of workplace, or salary. Based on companies' feedback, about 10% of the total job registrants were successfully placed. MOM is in the process of identifying the sectors for which demand for skilled manpower is still strong despite the economic downturn. This study is necessary as the manpower requirements in the economy have changed considerably since the onset of the regional economic crisis. Our preliminary assessment is that there are still job opportunities in new growth sectors such as the wafer fabrication, precision engineering, medical instrumentation and process chemical industries. LICENCE FOR MOTOR REPAIR AND SERVICE WORKSHOPS 6.”
“The hotline number 1822-5358047 is for enquiries on Employment Act. It has 3 hunting telephone lines, manned by 3 duty officers of the Labour Relations Department of the Ministry of Manpower, to answer enquiries on terms and conditions of employment, retrenchment and other Employment Act provisions. When the 3 lines are engaged, callers are channelled to the Integrated Voice Response System which provides pre-recorded frequently asked questions and answers on the Employment Act. The information is available both in English and Chinese. The hotline number for job seekers requiring assistance to find employment or prospective employers looking for job seekers to fill vacancies is 1800-5395389. It is manned by officers of the Ministry's Employment Service Department. EMPLOYMENT ASSISTANCE SCHEME 5. Mdm Claire Chiang See Ngoh asked the Minister for Manpower what percentage of applicants have found a job through his Ministry's Employment Assistance Scheme since its implementation; what sort of jobs they were matched to; and if there are clearer indications now on the sectors or types of jobs for which there is a demand but no supply.”
“The off-Budget measures were meant to help companies during this period of economic slowdown. They were implemented with effect from 1st July 1998. The measures would cost the Government $2 billion. Some of these will translate into cost savings for employers, while others will stimulate demand thus helping employers to save jobs. At this stage, it is too early to assess the full impact of these measures. 'LEASE-LET-SCHEME' OF JTC/HDB 35. Mr Ang Mong Seng asked the Minister for Trade and Industry, in view of the current economic slowdown, whether he will allow Jurong Town Corporation/Housing and Development Board lessees to let out up to 75% of their leased properties instead of the present 50% under the `Lease-Let-Scheme'.”
“JOBS SAVED AS A RESULT OF OFF-BUDGET MEASURES 33. Mr Ahmad Mohd Magad asked the Minister for Manpower whether there are statistics captured on jobs saved as a result of implementing the off-Budget measures and, if so, approximately how many jobs have been saved to date.”
“The total budget for the SRP is hence $120 million and is expected to meet the skills upgrading needs for up to 40,000 lower-skilled workers over the next 2 years. We will monitor closely the level of usage of the SRP and ensure that funds are sufficient to provide the training places needed and the scope of training to enhance employability for older workers. This will help us to minimise the impact of structural unemployment. FOREIGN INVESTMENTS IN SINGAPORE PROPERTIES 22. Mr Ong Kian Min asked the Deputy Prime Minister whether the Government will consider measures to attract foreigners to invest in Singapore properties, in particular, by suspending the restrictions on foreigners borrowing in Singapore dollars to finance their property purchases. BG Lee Hsien Loong: There is no restriction on foreigners buying private properties in Singapore, other than the long-standing restriction on landed properties and flats in buildings below 6 storeys. Whether foreigners buy properties in Singapore is a matter of supply and demand. The Government should not introduce special measures to favour foreigners who do so, just as it has in the past resisted calls to make it harder for foreigners to buy Singapore properties. The restriction the Member refers to is on financing of property purchases by foreigners using Singapore dollars. It was introduced to ensure that such foreigner buyers were serious investors with their own sources of funds, and were not borrowing Singapore dollars from banks here to speculate in the Singapore property market. Permanent residents are allowed to borrow in Singapore dollars to purchase one property, for owner occupation. As the objective of the restriction still remains valid, the Government has no plans to lift the restriction.”
“Older and unskilled workers are the most vulnerable group in an economic slowdown. Whether they will face prolonged unemployment for up to a year or more, depends on several factors. Firstly, are there still jobs for these workers? Yes, there are still many jobs, especially in the services sector, which can be done by older and unskilled workers. Secondly, can this group of workers make the necessary adjustments in terms of nature of work and wages in order to stay employed? They may have to accept lower wages, or work which is different from what they have been used to during this economic slowdown. Thirdly, how quickly can they acquire some useful skills which will help them to find alternative jobs? This is a critical factor. Apart from the economic slowdown, we are also undergoing restructuring towards higher technology and higher value-added industries. New jobs being created will need higher skills. Older workers, who are unskilled or lower-skilled, must upgrade themselves if they want to take on these new jobs. The problem faced by older and unskilled workers will result in structural unemployment. This is essentially a mismatch between supply and demand of labour in terms of skills, occupation or industries. Our strategy to deal with structural unemployment is focused on skills upgrading and re-training of older workers to meet the needs of the jobs being created by new investments. Hence, the Minister for Finance has allocated $50 million to the Skills Redevelopment Programme (SRP). This will complement the Skills Development Fund's allocation of $50 million for the SRP. In addition, the Minister for Finance has allocated $20 million to establish a Skills Development Centre.”
“Sir, older and unskilled workers are the most vulnerable group in an economic slowdown. Whether they will face prolonged unemployment for up to a year or more depends on several factors. Firstly, are there still jobs for these workers? The answer is yes, there are still many jobs, especially in the services sector, which can be done by older and unskilled workers. 1.30 pm”
“Sir, Question Nos. 16 and 17 are also connected. May I have your permission to take them together?”
“The real solution is to ensure that we continue to achieve steady economic growth and that new jobs will be created so that retrenched workers have the opportunity to take on these new jobs. And where the retrenched workers are unable to fulfil the skill requirements of the new employers, then the Government will come in to provide the necessary support, including funding, so that these workers' skills can be upgraded or they can be retrained to take on these new jobs. That is the only permanent and real solution to the problem of unemployment and retrenchment. PROLONGED AND STRUCTURAL UNEMPLOYMENT 16. Mr Low Thia Khiang asked the Minister for Manpower, in view of the current worsening economic situation, whether he foresees the possibility of prolonged unemployment of up to a year or more for older and unskilled workers. 17. Mr Low Thia Khiang asked the Minister for Manpower whether Singapore will face structural unemployment in the next two to three years and, if so, whether the current policy on training of workers is sufficient to cope with the situation.”
“Mr Speaker, Sir, the foreign worker levy is collected for a totally different purpose. It is a means of moderating the demand for foreign workers, in particular, the lower skilled foreign workers. As to Government setting up such a retrenchment fund, whether it is from fees and levies that Government has collected from elsewhere or even from cuts in Ministers' salaries, I think it is appropriate for me to point out to the Member that such retrenchment funds set up elsewhere have very often not delivered the results that they have been set up for. Let me read to Members the assessment which was made by the Japan Institute of Labour. This was carried by the Japan Labour Bulletin which was published in March this year. This is on their assessment of the national unemployment benefits. In Japan, since the early 80s, they have established an employment insurance scheme with the help of the government. I quote: `However, since 1994, the scheme has been in the red due to the worsening employment situation in Japan. Given this situation, the Central Employment Security Council has been studying ways to reduce the national treasury's contribution and to revise the employment insurance scheme in order to keep up with changes in the industrial structure and the ageing of the population.' So, what it says here is that a country, with Japan's economic resources and trillions of dollars of reserves, is unable to sustain a national employment insurance scheme in order to pay unemployment benefits to out-of-job workers. Do you think that a country like Singapore, with the limited resources that we have, would be in a position to do better?”
“Sir, I thought the Member asked whether the Government will consider setting up a Central Retrenchment Benefits Fund. So I presume that he is asking whether the Government would consider setting up such a Fund now, is it not? If he raises a Question at this point in time, that means he is asking whether the Government would do so. To come to his supplementary question, what happens if a company is in liquidation and has no substantial assets to pay retrenchment benefit? Even if we have a law to provide for retrenchment benefit to be paid or the quantum is stated in the law, if a company has no assets, then there is nothing that can be done. The company is bankrupt. It has no assets. So there is no way that we can force the company to cough up retrenchment benefit for workers that are now out of job. The Member also said that the situation of some workers who are retrenched with little or no retrenchment benefit is the result of the Government not doing anything to protect their interest in advance. I think that is quite wrong, Mr Speaker, Sir. The law has provided for the employees with more than three years' service to be eligible for retrenchment benefit and the trade unions have certainly acted on this provision because they have ensured that in their collective agreements, retrenchment benefit is clearly spelt out and the practice today in the unionised sector is for retrenchment benefit to be calculated anywhere from two weeks to a month for each year of service. Companies that are retrenching workers and are still in a sound financial situation very often comply with the provision for retrenchment benefit within their collective agreements. So it is incorrect to say that the Government has not looked after the needs of workers with regard to retrenchment benefit.”
“Mr Speaker, Sir, the setting up of a Central Retrenchment Benefits Fund is not a sound proposition. By requiring companies to set aside part of their profits every year, we will be tying up their financial resources. This requirement will also affect the cash flow of companies and weaken their ability to seize new business opportunities. To establish such a Fund now when the economy is slowing down, and may even go into recession, could hasten the demise of more companies. So instead of doing good, it may end up causing more workers to lose their jobs. I am therefore not in favour of the proposal to set up a Central Retrenchment Benefits Fund. This, however, does not mean that workers are not paid retrenchment benefit when they are laid off. In fact, retrenched workers with a minimum of three years' service are eligible for a retrenchment benefit although the quantum of payment varies from company to company and depends on the financial position of each company. For workers with less than three years' service, it is also not uncommon for their employers to grant them an ex-gratia payment to help them tide over their immediate difficulties before they secure an alternative job. Sir, in view of the current economic difficulties, I urge all companies with excess manpower to consider retrenchment as a last resort. They should seriously explore alternatives to retrenchment, including sending their employees for training and skills upgrading with Government's financial support.”
“Mr Speaker, Sir, as I explained in my answer, that would depend on how much we have to cut. It will also depend on how much savings the individual CPF member has in his Ordinary Account, and it also depends on how we spread the cut on the different accounts. CPF members would, of course, know that whatever savings they have in their Special Account could not be used for any other purpose. If, in fact, it is a crisis situation and we have to make a change, we could even consider allowing some of them to use part of their Special Account savings. These are all questions that have got to be carefully considered when we come to the point of considering such a move. I think it is premature at this stage for me to give Members figures of how many people will be affected because there are so many imponderables here.”
“1% above the CPF interest rate. Home-owners who took bridging loans could repay either in cash or through their future CPF contributions over 10 years. Similar assistance will be considered if we need to make a CPF cut.”
“Mr Speaker, Sir, as at the end of May 1998, 524,006 active CPF members are withdrawing CPF savings to service monthly housing loan instalments. Of these, 101,914 CPF members (or 19.4%) are withdrawing the full amount of their monthly contributions to service mortgage repayments. I have previously stated that the Government has no intention to cut the employer's share of CPF contributions this year. I would like to reassure hon. Members that this is still the position. However, if the situation continues to worsen next year, we may have to consider a reduction in the employer's CPF contribution rate. The number of people who have to seek alternative source of funds to service their mortgage loans is not just dependent on the size of the CPF reduction. It is also related to the amount of savings that the CPF member already has in his or her ordinary account. Some of these savings can be used to supplement the monthly contributions to meet the mortgage repayment. Furthermore, the distribution of a CPF cut amongst the Ordinary, Special and Medisave Accounts will also have an impact on mortgage servicing by CPF members. These are issues which will be carefully studied when it is necessary to make a CPF cut. When CPF contributions were cut in 1986, several assistance schemes were made available by the Government, in particular, to help home-owners with their mortgage repayments. For those with HDB housing loans, HDB extended the loan repayment period and allowed conversion of the loans to easy-payment schemes such as the ballooning scheme. Those with no income or had used up their CPF balances could also apply to defer payments for up to a year. The Government also offered bridging loans to those with private housing loans to service. These were given at a special rate of 0.”
“Sir, Question Nos. 11, 12, 13 and 14 are on the same subject. May I have your permission to take them together?”
“However, the institutions will exercise flexibility in helping students who are genuinely not able to begin their repayment within the stipulated timeframe. Graduates who wish to pursue further studies can do so at NUS and NTU, which offer research scholarships leading to Master's and PhD degrees. This option is best suited for graduates with an interest to pursue a career in research and development, especially in the areas of science and engineering. NUS and NTU will continue to offer more research scholarships so long as there is a demand by interested and qualified graduates.”
“Mr Speaker, Sir, in the long term, we expect to be short of talented and skilled manpower. So the Government's effort is towards increasing the supply of skilled manpower from our local manpower resources. We have a committee called Manpower 21 to look at the medium and longer term manpower planning to see how we can better meet the demands of various industries and to ensure that there will be sufficient output from our various institutions of higher learning to meet as much of the demand as possible. But for the longer term, with a small population of only three million people, and if we want to generate that kind of economic growth that we had been enjoying previously, my feeling is that we will always remain short of talent at the top end. That is why the Government is talking about trying to recruit international talent to supplement our domestic talent. UNIVERSITY AND POLYTECHNIC FRESH GRADUATES (Financial assistance for further study or self-improvement courses) 2. Mr Simon S C Tay asked the Minister for Trade and Industry, in view of the slowdown in job creation, whether the Government will consider measures to assist fresh graduates from universities and polytechnics, including bridging repayments of any outstanding study loans the students have undertaken and helping to finance further study or professional courses for self-improvement and skill upgrading. The Second Minister for Trade and Industry (BG George Yong-Boon Yeo): Mr Speaker, Sir, the maximum loan repayment period is 20 years for university graduates and 10 years for polytechnic graduates. University graduates are given up to two years and polytechnic graduates up to one year before they commence their loan repayment.”
“Mr Speaker, Sir, this year's group of graduates may experience a more difficult time getting a job, and I have said before that some of the graduates who are too fastidious or waiting for the ideal job to come around may find that they have to wait quite a while. So the advice is that, for a new graduate entering the job market for the first time, whether he is a polytechnic graduate or a university graduate, he should try to get a job as soon as possible, regardless of what the offer is and, even if it is not his ideal job, it is still better to have a job and be employed and take the time to learn the ropes than to stay unemployed because the economic situation is not very good. There is a sharp slowdown in the economic growth. Many companies are not expanding their head count even at the higher end. But having said that, there are still some sectors, whether it is in the manufacturing or service sector, which are still in need of more senior and experienced or even graduate employees, and these are the companies that will be recruiting. In some cases, they may even find that they have difficulty getting the number of skilled workers that they need from among our pool of graduates. For instance, in the manufacturing sector, like the wafer fab, which I mentioned earlier on, they have a very high demand for technicians and engineers whom we cannot completely meet with our own graduate output. Some of these companies may in fact still have to recruit foreign talent to supplement the domestic graduates who are joining the workforce at the moment.”
“Mr Speaker, Sir, we have quite a large number of older workers, aged 40 and above, who have less education because, in their younger days, education was not so freely and readily available. This is the group of workers that are most in need of skills upgrading. Skills upgrading needs a little bit more time. We cannot just wave a magic wand and overnight we have 400,000 or 500,000 workers who are suddenly turned into skilled workers. So although the Skills Redevelopment Programme was launched in December 1996, it will take us quite a few years to reach out to all the older workers to help them to upgrade.”
“Mr Speaker, Sir, the Skills Redevelopment Programme was first launched in December 1996 under the auspices of the NTUC, the Singapore National Employers' Federation (SNEF) and the Government. Several Government departments or statutory boards were involved. EDB and PSB were very much involved in the pilot phase of this programme.”
“Mr Speaker, Sir, the manpower situation has been affected by the current economic slow-down. More workers have been retrenched. The majority of jobs lost was in labour intensive and low-skill areas. On the other hand, new jobs created tend to be of higher value added and require higher level of skills. For example, in the manufacturing sector, the $8.5 billion of committed fixed asset investments will generate some 20,000 new jobs over the next few years. Most of these new investments such as wafer fab, petrochemical and telecommunications, require skilled workers with NTC certification. The demand for workers with technical and specialised skills includes more than 2,000 engineers, 2,000 diploma holders and 3,000 NTC II holders for this year. In view of the shift in demand to higher skill jobs, we face a real danger of a mismatch in the skills required by the employers and what our workers can do. Structural unemployment will be the outcome if nothing is done. This problem must be tackled by retraining and skills upgrading, especially for the older workers. Hence, the Government has committed $50 million in addition to the Skills Development Fund's $50 million to expand the outreach of the Skills Redevelopment Programme which is targeted at upgrading workers' skills so that they can cope with the changes. Yesterday, the Minister for Finance announced another $20 million for a Skills Development Centre. The $120 million Skills Redevelopment Programme will be able to provide skills upgrading for up to 40,000 workers. If every worker makes a determined effort to raise his or her skill level, we will be able to close the gap and rid the consequences of structural unemployment.”
“Around 11,000 workers were retrenched from October 1997 to March 1998 by private sector establishments with at least 25 employees. Majority (77%) of the retrenched workers were from manufacturing, mainly the electronics (53%), electrical (6.9%) and petroleum and chemical (4.7%) products industry. The services sector accounted for 22% of the total retrenchment mainly in wholesale and retail trade (9.3%), real estate and business services (3.3%) and financial institutions (3.2%). Among the retrenchments that were notified to the Ministry's Labour Relations Department, roughly 46% of the retrenched workers were from foreign-owned companies. The remaining 54% were from local enterprises. PROTECTION AGAINST INTRUSIONS OF ELECTRONIC, TELEPHONE AND COMPUTER COMMUNICATIONS 6. Mr R. Ravindran asked the Minister for Communications whether he will consider introducing legislation to protect individual privacy from any intrusion by third parties in all forms of electronic, telephone and computer communications.”
“I am pleased to inform the Member for Bukit Batok that such a scheme is already in place to help employers. Under the SDF Training Voucher Scheme, a company need not pay the full fee for the approved training programme. It pays only its share of the fee. The SDF will reimburse the training provider directly for the subsidised portion. This eases the cash-flow for companies. The Training Voucher Scheme (TVS) helps employers to gain access to a wide selection of skills training courses. These courses are supported at up to 80% of the course fee. There are presently a total of 423 TVS programmes offered, covering both technical skills and productivity improvement modules. In FY 1997, a total of 9,933 applications were supported under the Scheme. The PSB will extend this Scheme to cover all publicly offered training courses. This will reduce the training expenses of employers, and encourage them to consider more training for their staff. CASES OF ENTEROVIRUS-71 INFECTION 22. Dr Lily Neo asked the Minister for Health (a) whether there are cases of Enterovirus-71 infection in Singapore at the moment; (b) whether his Ministry will make laboratory tests available to doctors for early diagnosis of the disease; and (c) whether there are suitable quarantine wards for affected patients if the need arises.”
“Ravindran asked the Prime Minister whether the Government will issue a directive to Government Ministries, statutory boards and other related revenue collection/charging agencies to be sympathetic and understanding to families, individuals and companies who have been affected by the present economic crisis and are facing financial difficulties.”
“We have a limited labour pool. In the last ten years, we have to constantly augment with foreign workers to meet the needs of growing industries. It is hence a key priority of the new Ministry of Manpower to ensure as close a match between labour supply and labour demand, not just in numbers, but also in terms of trained manpower. At the industry level, various Government agencies such as the EDB, NCB, and the MAS, have their own manpower plans. For example, in planning for the expansion of manufacturing services under Industry 21, the EDB has worked very closely with industry to map out the skills profile for the new manufacturing workforce. Industry 21 has several initiatives to address the need for trained manpower to support the expansion. The MAS also has its plan to meet the expected growth in financial services. A national plan for manpower is now being drawn up by a Manpower 21 Committee comprising the captains of industry, the Government, and the trade unions. This multi-agency and tripartite approach to manpower planning and development is necessary to cope with the needs of different industries. My Ministry will coordinate the effort of the Manpower 21 Committee to develop a workforce that will be able to meet the needs of the Singapore economy and enhance our competitiveness. PLANS TO ASSIST RETRENCHED WORKERS 16. Mr Zulkifli bin Baharudin asked the Minister for Finance whether he will consider introducing measures for Government agencies to introduce plans to assist retrenched workers if they have difficulties in paying charges and fees such as those relating to utilities, telephone, Housing and Development Board rent and mortgage instalments, and property and income taxes. PERSONS AFFECTED BY ECONOMIC CRISIS 18. Mr R.”
“Per month. $6,000 of his salary per month. This is already allowed. So we should not deny anybody who wants to make voluntary contribution into a newly opened CPF account to put aside some money for his old age. I think, on balance, we should allow and welcome voluntary contributions. 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. [Dr Lee Boon Yang]. Bill considered in Committee; reported without amendment; read a Third time and passed.”
“But the self-employed already enjoys tax benefit from the CPF contribution up to 20% of his income or $14,400 per annum, whichever is the lower. So there is already a provision and, in fact, it is an incentive for the self-employed to make CPF contributions and to enjoy the tax benefit which all employees enjoy. And we should also not discriminate against the higher income people for wanting to put some money into their CPF accounts, because Members have to remember that even the highest income employee also makes CPF contributions of a portion of his salary, ie, up to $6,000. A person may be earning tens of thousands of dollars but he also contributes CPF up to a maximum of $6,000.”
“A CPF member uses the savings in his Ordinary Account to pay his home mortgage as and when he needs it. He can use his Medisave to meet his medical expenses as and when he needs it. He can even draw the savings from his Ordinary Account to invest in shares. He can take it out and put it into a bank as a fixed deposit if he thinks that the rate there is better. So there are many options for a CPF member to draw from his Ordinary Account. Putting the money in the Special Account is only one of the options, but this option carries with it certain conditions. And one of the conditions is that a CPF member cannot withdraw it at will until he reaches the age of 55. I think we have to keep it that way. Otherwise, we lose the basis for paying the additional interest on the balance in the Special Account. Mr Chiam raised another point about different classes of members. Yes, I think different classes of members are necessary because we have employees who are CPF members. They contribute 20% plus 20%. We have the self-employed people who have to make mandatory Medisave contribution but voluntary contribution for the Ordinary Account or Special Account. So we have totally voluntary contributors who can contribute as and when they want and with whatever amount that they want to. There is no minimum contribution that they must comply with. So we need to create these different classes of members. His other point is about people who contribute to CPF for other reasons to take advantage of income tax. Today, self-employed people can already make voluntary contribution. They, of course, have to make mandatory contribution to their Medisave accounts.”
“The other point which Dr Vasoo raised was, if I got it correctly, what else would the Board do to help members to increase their old-age savings. This move to increase the interest that is being paid for the balance in the Special Account is one such effort on the part of the Board. By paying 1�% interest over and above the interest in the Ordinary and Medisave Accounts, it will in fact help many members to save up much more money in the Special Account for their old age. Mr Chiam and Dr Vasoo also mentioned the same point about irreversibility or irrevocable decision to transfer money from the Ordinary Account into the Special Accounts. Members have to understand that the Special Account represents very long-term savings. A CPF member cannot withdraw the money in the Special Account until he reaches the age of 55. So he is making a commitment to leave this money for a fairly long term, which is why the Government can guarantee that we will pay 1�% interest above the normal interest rate. The normal interest rate is calculated on the basis of an average interest rate of banks' savings accounts and one year term deposit accounts. So CPF members are getting higher interest than what they normally would get if they place their savings in a bank. We cannot allow a situation where people transfer money from the Ordinary Account into the Special Account and then transfer it out as and when they need it, ie, earn the extra interest and then take it out. That would defeat the whole purpose and the basis on which the long-term interest rate has been calculated to offer this additional 1�%. Members must remember that the Ordinary Account is actually money available on demand for most CPF members. It is not locked up to the age of 55.”
“It is up to the employer to make a firm and concrete proposal to the CPF Board to repay all the arrears within a certain timeframe, including the interests accumulated on the arrears, so that the employees are not worse off. The Board will take into consideration such appeal but it has got to be assured that there is some payment coming because the Board will certainly want to safeguard the interest of the members to ensure that it does not just allow the employer to prolong the process and, at the end of the day, there is nothing to claim on behalf of the employees. I think that would be a very undesirable situation. While we are sympathetic, we also have to remember that our first responsibility is really to safeguard the interest of the CPF members. Dr Vasoo has asked whether there could be a tax deduction to encourage more people to contribute voluntarily. Firstly, let me point out that most employed Singaporeans actually do not pay income tax already. I think nearly about 70% of the employed Singaporeans do not pay any personal income tax. So, income tax may not be that effective as an incentive. Voluntary contribution is targeted at a group of people who are not working either as an employee or as a self-employed. They do not have any taxable income. So tax incentive is also not applicable in this sense. Voluntary contribution is a totally free choice on the part of a Singaporean who wants to put some money aside for his old age, and who looks at the CPF as a very safe long-term investment, as a very secure place where he can put aside his old age savings, knowing that the interests are guaranteed and that, in fact, if he puts the money in the Special Account, he would earn a premium interest of 1�% above the normal CPF interest.”
“Mr Speaker, Sir, I know time is very short and I have to rush through my response. But, first, I have to thank the hon. Members, Mr Yeo and Dr Vasoo, for supporting this Amendment Bill. I would address the points as they have raised them. Mr Yeo asked whether there are more and more cases of employers committing offences under the Central Provident Fund Act. While the number of such cases has not risen sharply as to attract special attention, the point is that the $200 compound fine limit had been set many years ago, and I think it is time to make an adjustment. If we do not do so, there may be some employers who will say, "Since the fine is so little and my employee's CPF contribution is so large and the interest rates being what they are at the bank, I can always defer payment of the CPF contribution. I will wait until I receive a Notice to Attend Court, then rush and pay. It is still worth my while to be in arrears from time to time." But I do not think that is a good situation. We should not encourage that. We want to serve a reminder to all employers that they should pay up the CPF contribution of their employees on time rather than wait. Is the $500 compound fine enough? I would say at this juncture, yes, because it was set at $200 some years ago. We are making a revision now. If in the years to come, we discover that, again, it is not adequate as a deterrent, we are always prepared to review it. Will we give the employers an opportunity to explain their predicament if they are unable to pay? Yes, the CPF Board is always ready to listen to an employer if they have some difficulty.”
“Priority of Claims Sir, currently the CPF Act gives the Board priority over execution creditors who have taken out Writs of Seizure and Sale against the assets of employers. However, the Board does not have priority when creditors attach employers' bank accounts or seize their movable properties. This had resulted in cases where employees' CPF arrears could not be recovered. Clause 9 of the Bill therefore amends section 68 of the Act to allow the CPF Board to have priority for CPF arrears over landlords who have taken a Writ of Distress against defaulting employers. The same clause also extends the Board's priority of claims to cover garnishee order in cases where creditors have attached the bank accounts of the defaulting employers. Conclusion Sir, in conclusion, the amendments proposed in this Bill will ensure that the provisions of the CPF Act will continue to be relevant and in line with the objectives of the CPF system. The amendments will also remove existing rigidities and thus better safeguard employees' interests by ensuring that their CPF contributions are promptly paid. Sir, I beg to move. Question proposed.”
“Composition of offences Sir, at present, the CPF Board is empowered to compound any offence under the Act for a sum not exceeding $200. Composition has proven to be an effective way to deal with employers who have defaulted in CPF payments. To enhance the effectiveness of this enforcement option, the Ministry proposes that the maximum composition fine be raised to $500. This amendment is reflected in clause 7 of the Bill. Certification of Board on non-payment of contributions Clause 8 of the Bill introduces a new section 66A to provide that a certificate issued by the CPF Board stating the amount of contributions and interest that is due from an employer is to be treated as prima facie evidence of those facts. This is to replace the need for every affected employee to attend court as a witness. The use of certified documents as prima facie evidence can be found in other legislation such as the Sale of Food Act and the Patents Act. Under the Patents Act, for example, attendance of the witness is not necessary to prove authenticity of documents or entries authorised by the said Act. A certificate signed by the Registrar can be admitted as prima facie evidence. Nevertheless, should the Court so require, the CPF Board will ensure that affected members attend court as witnesses. Sir, the removal of the need to seek Public Prosecutor's sanction, issue of Notice to Attend Court, new service of Notice to Attend Court and the certification of Board on the non-payment of contributions will save 40 days from the arrears recovery process. It will help to prevent employers from delaying payment of their employees' CPF contributions.”
“The new section 62 empowers a CPF Board officer to issue a prescribed notice to a defaulting employer requiring him to attend court in lieu of applying for a summons of court. This amendment would allow the CPF Board officers to issue Notices to Attend Court similar to those issued by the Traffic Police. The Traffic Police found that this provision had worked well for them and 80% to 85% of the offenders have paid their fines by the composition date. Currently, Notices to Attend Court are also issued by agencies such as the Ministry of the Environment and the Ministry of Health for offences such as littering, breeding of disease bearing insects, operating as a hawker without licence, and many other offences. This amendment would shorten the recovery of CPF arrears significantly, hence benefiting employees. Service of Notice to Attend Court/Summons Sir, the new section 62A sets out the manner in which a Notice to Attend Court issued under the new section 62 or a summons issued by a court may be served. Under the existing provision, summonses must be served on employers personally. It is difficult to locate the employers in most of the default cases, hence usually many attempts have to be made before substituted service, such as affixing the summons at the employers' premises or advertisements in the newspapers, is allowed by the court. Allowing the service of Notice to Attend Court and summons, for example, by registered post would reduce the time taken to serve such notices or summons from about 3 weeks to only 2 to 3 days. I would like to point out that other statutory boards such as the HDB, URA and LTA already have similar provisions in their respective legislation.”
“Employees use their CPF savings for various commitments such as housing, healthcare and insurance, apart from savings for old age. Hence, there is a need to ensure that the CPF Board deals effectively and promptly with employers who have failed to pay CPF contributions for their employees within the prescribed time, and the Board also has to speedily recover these contributions which are now overdue. A slow and protracted recovery process may encourage some employers to chalk up larger arrears at the expense of the employees. The CPF Board's role is to safeguard CPF members' interests and enforce CPF payments to ensure that members' contributions are paid promptly. Hence it is necessary to amend the CPF Act to expedite the recovery of CPF arrears. The proposed amendments in four areas will reduce the total number of days taken to recover CPF arrears to about 60 days, a reduction of about 40 days. Public Prosecutor's sanction Sir, the first area is on the Public Prosecutor's sanction. The existing provision in the CPF Act requires the CPF Board to get the Public Prosecutor's sanction before the Board could commence prosecution action against employers who have defaulted in CPF contributions. Since the CPF Board has always and will continue to discharge its powers fairly and impartially, the Public Prosecutor has agreed that such prior approval is not necessary. Hence, clause 6 of the Bill repeals the existing section 62 to remove the requirement of obtaining the Public Prosecutor's sanction before initiating prosecution under the CPF Act. Notice to Attend Court Clause 6 also inserts new sections 62 and 62A.”
“Sir, it is not the intention of the HPS to pay insurance claims on two HDB flats for one CPF member should he die or become incapacitated permanently before the housing loan is fully paid up. Clause 5 of the Bill therefore enacts a new section 30A to provide that no person may be insured under the HPS for more than one HDB flat at any one time. This provision allows the CPF Board to automatically terminate the HPS cover for a CPF member's existing HDB flat upon the commencement of HPS cover for his new HDB flat. The CPF Board will refund the surrender value of the HPS cover for the existing flat to the member upon cessation of the cover. With this amendment, should a CPF member die or become permanently incapacitated during the transitional period when he legally owns two HDB flats, the HPS will pay the insurance claim on the new flat while the member's family can proceed to sell the existing flat and receive the proceeds of the sale after discharging the outstanding housing loan for the old flat. Enhancing the enforcement and recovery of CPF contributions Sir, I next turn to the amendment concerning the enforcement and recovery of CPF contributions. Currently it takes about 100 days to prosecute employers who have defaulted on CPF payments. That is more than three months to trace up on an employer who is in arrears to his employee's CPF contribution. This long period results in employers owing more CPF contributions to their employees because of the delay in the prosecution action. This delay is mainly due to existing provisions in the CPF Act which stipulate the procedures that the CPF Board has to follow when recovering CPF arrears from the employers. Sir, CPF contributions form part of employees' salary.”
“In other words, once you transfer savings into the Special Account, they will remain locked up in the Special Account until age 55. Sir, clause 4 of the Bill inserts a new section 18B to allow a CPF member to apply to the CPF Board to transfer a portion of his Ordinary Account savings to his Special Account, and to provide the limit on the amount which may be transferred. This is to allow the CPF member to receive a higher interest on his CPF savings and to build up his cash component for retirement purposes. The transfer is only permitted if the amount of savings in the CPF member's Special Account is below a prescribed amount. This prescribed amount is set at $40,000 currently, in line with the eventual cash component of the CPF Minimum Sum Scheme in the year 2003. Home Protection Scheme Sir, the Home Protection Scheme, or otherwise known as HPS, was introduced in 1981 to protect CPF members and their families from losing their HDB flats should a member die or become incapacitated permanently before the housing loan is fully paid up. Under normal circumstances, a member can only own one HDB flat at any one time. However, HDB gives upgraders a grace period of six months to sell off their old flats after they have purchased and been allocated their new flats. In fact, this grace period may even be extended if the upgrader has difficulty selling his old flat and HDB will consider such appeals. So there are occasions where HDB flat owners and CPF members are actually owning two HDB flats for more than six months. HPS is a compulsory mortgage reducing term insurance for CPF members who use their CPF savings to service HDB loans. Hence during this transitional period, a CPF member legally owns two HDB flats and has to pay the premiums for two HPS insurance policies.”
“Mr Speaker, Sir, I think hon. Members are going to be disappointed. I am not going to defer the Bill. Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." Sir, the Central Provident Fund (Amendment) Bill before the House today seeks to amend the Central Provident Fund Act to enable the implementation of CPF policies regarding voluntary contributions, intra-account transfers and the CPF Home Protection Scheme. The Bill also seeks to streamline the enforcement and recovery of CPF contributions. I shall now highlight the major changes introduced by this Bill. Voluntary contributions First, on voluntary contributions. Clause 2 of the Bill amends the CPF Act to expand the definition of "member of the Fund" or "member" to include any person who contributes to the CPF Fund voluntarily. Examples of such persons are housewives and Singaporeans working overseas. To encourage such persons to save for their retirement and medical care, a new section 13B will be introduced in the CPF Act to empower the Central Provident Fund Board to receive voluntary CPF contributions from such persons. This amendment is in clause 3 of the Bill. Intra-account transfers Sir, on intra-account transfers, the Finance Minister had announced in February 1998 that CPF savings in the Special and Retirement Accounts will earn higher interest rate. The interest rate will be 1.5% more than the Ordinary and Medisave Accounts' interest rate with effect from 1st July 1998. In addition, CPF members are allowed to transfer their savings in the Ordinary Account to the Special Account up to a cap of $40,000 in the Special Account, with no option of reversal of the moneys transferred.”
“The Programme consists of an integrated job placement system to enable various agencies (MOM, EDB, SNEF, NTUC, and companies) to pool job vacancies into the job bank of the Ministry's Employment Service Department so that the Department would be in a better position to assist retrenched workers secure re-employment expeditiously. Sir, to help retrenched workers secure alternative employment and at the same time enhance their employability, low-skilled retrenched workers will be offered appropriate training under SRP for higher value-added jobs. This will enhance the employability of such workers and make them less vulnerable to future retrenchments. To better assist retrenched workers in securing re-employment, companies are therefore urged to notify the Employment Service Department of their job vacancies. In addition, the Panel has also recommended that information on alternatives to retrenchment and how employers could carry out retrenchment responsibly be made available to companies. For workers affected by retrenchment, they would need to be advised on how they could secure re-employment expeditiously and cope with the situation. For this purpose, the Ministry has produced two pamphlets for distribution: one targeting at companies and the other at retrenched workers. Sir, the implementation of the Committee's recommendation will result in more effective employment assistance to retrenched workers. Further, low skilled retrenched workers will be given the opportunity under the SRP to take up higher skilled jobs and this will enhance their employability.”
“The Panel comprises representatives from the Ministry of Manpower (MOM), EDB, PSB, NTUC, and the Singapore National Employers' Federation (SNEF). I am pleased to inform the House that the Panel has completed its deliberations and has submitted its recommendations. As announced during a press briefing on 26th June 1998, my Ministry has accepted the Panel's recommendations and will implement them with effect from 1st July 1998. Sir, let me highlight the key recommendations of the Panel. Sir, to minimise retrenchment, the Panel recommended that a Retrenchment Advisory Programme involving MOM, EDB, PSB, NTUC, and SNEF be implemented. Under the Advisory Service Programme, companies with excess manpower and are contemplating retrenchment would be encouraged to provide advance information to any of these agencies so that appropriate advice on the various alternatives to retrenchment could be given. These alternatives include the implementation of shorter workweek and temporary lay-off, making use of the flexible wage system to reduce cost and avoid retrenchment, as well as sending of their workers for subsidized training through the Skills Redevelopment Programme (SRP) during the lull period. Under the Retrenchment Advisory Programme, companies with surplus manpower can approach any of the participating agency which they are most comfortable in dealing with, so that they could be better informed of the alternatives to retrenchment, including the training grants available under the SRP. The Tripartite Panel has also recommended that an Employment Assistance Programme be implemented to assist retrenched workers seeking re-employment as soon as possible.”
“Mr Speaker, Sir, the Member is correct in saying that in the 1985/86 economic downturn, we cut the employer's CPF contribution rate by 15 percentage points. We will cross the bridge when we get to that point. RETRENCHMENT SITUATION AND MEASURES TAKEN BY TRIPARTITE PANEL ON RETRENCHED WORKERS The following Question stood in the name of Mrs Yu-Foo Yee Shoon - 13. To ask the Minister for Manpower if he will give an update on the retrenchment situation and the measures that the Tripartite Panel on Retrenched Workers will take to deal with this issue and to help workers find alternative employment. Mr Yeo Guat Kwang (Cheng San): Question No. 13, Sir. The Minister of State for Manpower (Encik Othman bin Haron Eusofe) (for the Minister for Manpower): Mr Speaker, Sir, in the first quarter of 1998, a total of 7,131 workers were retrenched. This is the highest quarterly figure ever recorded since retrenchment data was first compiled in 1983. The majority of the retrenched workers were from the manufacturing sector, mainly the electronics, electrical, and petroleum and chemical products industries. Survey findings show that 63% of the local workers retrenched in the fourth quarter of 1997 were re-employed by March 1998. This was significantly lower than the 72% re-employment rate of those who were retrenched in the previous two quarters. Retrenched workers with higher education and skills generally enjoyed better re-employment prospects as compared to those with lower education and skills. The Ministry will continue to monitor the retrenchment situation closely. The increase in number of workers being retrenched is not unexpected. In fact, in anticipation of this, my Ministry had in late February set up a Tripartite Panel on Retrenched Workers to prepare for this eventuality.”
“Mr Speaker, Sir, if we cut down the employee's CPF contribution rate, then we will also have a very significant impact on the workers' ability to service their mortgage loan repayments, because many CPF members depend on their monthly CPF contributions to service their mortgage loans. If you cut down on the employee's CPF contribution, obviously many CPF members will have to come out with their own cash to meet the monthly repayment. So it may not be of much benefit in terms of boosting the spending power of the consumer. Cutting CPF should be taken as a cost reduction measure rather than as a consumption stimulation measure. And if we do eventually have to cut the CPF because the economic situation has got worse, then cutting the employer's CPF contribution makes more logic and it is more rational than cutting the employee's CPF contribution.”
“Mr Speaker, Sir, the Government has indicated that if the preliminary estimates for Singapore's second quarter growth shows a further slowdown, off-Budget measures to help the economy will be implemented. Off-Budget measures including raising Government's expenditure for infrastructure projects and cutting the cost of doing business will be announced by the Minister for Finance later today. A cut in CPF contribution rate is one of the options that we had considered in view of the deterioration of economic prospects. As this is a drastic measure, we should not rush into cutting CPF. The National Wages Council has recently announced its recommendations urging companies and workers to exercise wage restraint to tide over the difficult period. Although our economy has slowed down considerably, we have not experienced negative growth yet, as in 1985. The wage structure in 1985 was also more rigid, leaving little room for adjustments. However, with the flexi-wage system that is in place today, companies can now reduce their wage cost by adjusting their variable payment, including the AWS (or Annual Wage Supplement) based on the performance of the company. Reduction of the CPF contribution should be implemented only if these cost cutting measures need a further boost.”
“Hence Government has committed $50 million to the next phase of the programme to defray the cost of absentee payroll and training for up to 20,000 workers. The SDF has also commited another $50 million to support the SRP. (b) Back to Work Programme (BTWP) The Back to Work Programme was started in 1996 to attract and assist housewives, retirees and retrenched workers to return to the workforce. Under the programme, the Ministry of Manpower provides job placement services to individuals. Training programmes for re-entry into the workforce are offered by the Productivity and Standards Board. The SDF supports 100% of the course fees for the core skills training to prepare these individuals for re-employment, and 80% of subsequent job skills training. Trainees are also given a $100 allowance during the period of the core skills training. VACANT LAND AT SERANGOON AVENUE 1 8. Mr Goh Choon Kang asked the Minister for National Development whether the Housing and Development Board has any plans for the plot of vacant land bounded by Blocks 401 to 403 at Serangoon Avenue 1 and, if not, whether the Town Council will be allowed to convert it into a small precinct park for the residents.”