Teo Ser Luck
Singapore
“Mr Chairman, Sir, in the initial days when I set up offices overseas – whether it is China, Kuala Lumpur or Jakarta – I used a translator for the local contracts as well as for meetings. Lately, I have been using online platforms, especially in China and also in Malaysia.”
“So, in this day and age, with the world changing really fast, and with social media and information overload, how is the SPF or how is the Ministry going to maintain that public trust and confidence in our Police Force?”
“We have to put in some of these funds, for example, the $300 million additional funds put it into agri-tech, would the agri-tech in future provide a more comparative and affordable pricing for some of what it produces or these technology startups would be able to scale overseas, globally, have a commercial aspect to that.”
“Chairman, I am a heavy user of technology. And when I started on a technology project, I created a first layer of programming and algorithm where the machines started to learn. With more data collected, more and more, the machine gets smarter and it could make intelligent decisions or informed decisions for me.”
“We have tight regulations on financial institutions in their lending platforms and also non-bank lending platforms in regulating them, making sure that they do not go beyond their means to lend out to those that they cannot do the Know Your Customer survey or assess their credit readiness.”
“I believe there are three aspects of transformation that will impact the workers directly. First, the job redesign, change in the process, change in the scope of the job. Second, job shift, the job itself is no longer available and they have to change sectors. Changing sectors also requires a mindset shift.”
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“We have not, so far, tried to prioritise any sector. It is important that we help support as many SMEs as we can as they branch out or expand because Singapore has its land as well as resource constraints. We are planning for many different trips. In fact, I will be leading a business delegation within this month to Indonesia and also trips to the other cities and countries are being planned across ASEAN. ASEAN, as a hinterland, is how Singapore businesses can also use in order to survive and even to strengthen their own business operations throughout. There are things they cannot do in Singapore that our hinterland or our neighbours in the ASEAN Community can help us with. That is exactly where we are coming from, and we hope that AEC 2015 will help give us that advantage.”
“The latest numbers I have got, as I have mentioned earlier, was 6% in the second quarter of 2014, compared to 4.4% a year ago. From the ground sentiments and from talks with the trade associations, we also understand that some of the businesses, small and medium enterprises (SMEs) and so on are facing some challenges. Definitely, it is a journey and it is a long-haul journey to actually transform and make changes to become more productive and automate the processes. It is not going to be easy. Page: 31 As we monitor the situation, we know that some of the companies will do it better than others. We will continue to encourage by providing some of the schemes and grants to help them make the change. It is up to the companies themselves to be able to do so. The general sentiment is that they are still facing some manpower challenges because it takes time to make the change. But for events like F1 and some of these large-scale events, we are still able to manage them; we are still able to host them with a good quality service level. So far, the latest one that was held, we have got very positive feedback in terms of services, in terms of companies providing contract work, food and beverage and hosting the whole event. Progressively, we are making leaps and bounds in terms of productivity as well as the kind of quality service that we provide throughout the F1 event. We will monitor and, definitely, the Ministry of Manpower and ourselves are also working hard and looking at the numbers. We also look at the companies and are working with trade associations to do so.”
“So far, from the general feedback about transportation of the workers coming into Singapore and whether it affects the operations of the companies, we have not received feedback of major issues regarding whether workers have been greatly affected. Operations still go on as per normal but of course, the cost in some way has already been impacted. The cost is higher. That is something to be managed. But as far as operations are concerned, so far, there is no feedback. We will monitor over a period of time to see whether that has adversely affected the on-going operations. We have to work with the associations. Some of the associations have members from SMEs and micro enterprises that do their business in transporting goods across the Causeway. We have to monitor that sector and get some feedback from them over a period of time to see how that can be affected and whether measures are needed to help them.”
“For the benefit of the Member Mr Yee, I have also mentioned in public before that REITs have some signalling effect for the landlords and developers around the area when the rental increase or decrease happens. So, there is some signalling effect although REITs in themselves are not a dominant factor or may not be a dominant factor in the influence of all in the market itself. But we do recognise that there is a signalling effect. As for monitoring of the rental changes, we are monitoring very carefully and that is exactly why before the end of the year, we want to make sure that we publish the rental index – more detailed, more specific, make it clearer – so that the tenants and landlords can make more informed decisions when they do their lease negotiations. I think the principles behind this, whatever measures and approaches that we roll out, is to make sure that there is a fair practice and they would enhance the business practice that will help the market as a whole.”
“That is a fundamental objective of what MTI does and we will want to continue to inject vibrancy into the economy so that we can achieve our vision for the future. 6.11 pm”
“The President noted in his Address that just as our pioneers overcame formidable obstacles with grit and determination, we, too, must create our Singapore of tomorrow. Over the last half century, Singapore's economy has performed well. But this did not come by chance. We have consistently taken proactive steps to ensure that our people and our businesses are well prepared for the future and we are still doing that. We have not shied away from making difficult decisions. We will maintain strong economic fundamentals, such as an open and business-friendly environment, good governance, sound infrastructure, a Page: 92 highly educated workforce, but, most importantly, a stable political climate and position in Singapore. Many businesses are encouraged because we have a very stable political climate in Singapore. We cannot take that for granted as well because we must get the fundamentals right. The President has mentioned about moving forward is not just about stable politics but also constructive politics. Mr Low has also mentioned about constructive politics and his view and perspective about it. The way I interpret constructive politics is that it is not about trying to be popular, not to come up with populist policies but to be able to engage effectively, understand effectively and provide a solution that is effective. It is not about being populist and winning more support. Sometimes, it is about making very difficult decisions. And that is a fundamental of all stable political systems. With that, the economy can grow, people will have confidence, and businesses will have confidence to invest in Singapore. For Singaporeans, moving forward, we want to provide them with good jobs.”
“It has also been specifically designed for SMEs involved in heavier manufacturing activities to be flexible and future-ready. Its high floor loading and wide corridors will allow for traditionally land-based industries to go high-rise. We will also ensure that the market functions in a fair and balanced manner by increasing data transparency for retail and industrial space so that businesses are able to make informed decisions, as I have mentioned. URA has recently made median rental of retail space by street name freely available. We will work closely with URA and IRAS to further refine the retail rental data and to provide them at a more granular level towards the end of the year. I know that the key trade associations are studying the development of a framework of best practices for lease contracts. We encourage that and I believe that they will be recommending the framework very soon as a code of best practices or guidelines on best practices. If we can come up with the guidelines of best practices, it can enable good and fair practices for both sides. The Government is supportive of these industry efforts. Over the next three years, around 40,000 to 45,000 young Singaporeans are expected to enter the job market each year. Two-thirds will hold Professional, Managerial, Executive and Technical (PMET) jobs. We need to transform our economy to create good jobs that cater to the aspirations of this workforce and provide sustainable wage growth to enable Singaporeans to improve their lives. It is not going to be easy for our businesses and our local SMEs. We understand. I have always mentioned that the Government will always be with the SMEs throughout this journey.”
“As Members would know, I have announced it before that the success of Block 71 at Ayer Rajah Crescent forms a very closely-knit entrepreneurial community. We will expand that area to include two other blocks and that whole area will be called JTC LaunchPad @ one-north. That will boost our startup scene in Singapore and, hopefully, attract more capital into Singapore to help our startups. Singapore has limited land, and our land prices and rents reflect this. We have to continue to monitor it, explore different ways to make the best use of the land and space that we have. There is a substantial supply of space which will be coming onto the market. Rents for space are, therefore, likely to moderate in the medium term. But simply adding more space is not a sustainable solution. We have to explore more ways. Sometimes, when the rent increases, from different organisations, it does impact. There is a signalling effect, but it may not be a dominating effect. But we believe that there is a need to provide more information for the tenants and for the landlords as well to make more informed decisions. We will continue to explore ways to make sure this information is available and, within this year, we will make sure that such information is more accessible for decisions to be made. We will Page: 91 also build customised buildings – no-frills facilities – for different clusters of industries and sectors. Sir, JTC has pioneered high-rise infrastructure solutions and specialised facilities. We will continue to do more. Last week, JTC launched the JTC Space @ Tampines North. This development integrates land-based facilities with high-rise, multi-user factories.”
“IE Singapore has in place a comprehensive system of support to help companies to successfully internationalise by helping the companies gain access to information, overseas networks and financial support that they need. Some of the companies tap on the IE schemes, Page: 90 such as setting up offices overseas. IE has a scheme and we have programmes that help defray the costs of setting up offices overseas, accessing information, doing research, employing people. In 2013, IE assisted over 26,000 companies, including the provision of S$42 million in grants and facilitation of S$774 million in trade financing. It is important for companies to tap on these, especially companies completely new to the market. Talking about startups and new companies, we need them to revitalise and rejuvenate the trade and the business sector. There will be companies that will not find survival or space in the new way moving forward; there will be new companies that will be set up, we will try and find the space. We have to help them all. We need more new companies, we need more innovative companies. Sir, apart from helping the established businesses and the SMEs, the Government will continue efforts to ensure a conducive ecosystem to help the growth of startups. With the maturing of our entrepreneurial landscape, we will be reconstituting the Action Community for Entrepreneurship (ACE), which is the Entrepreneurship Committee that I used to chair, into a private sector-led entity to allow the private sector a greater role in shaping a dynamic entrepreneurial community. At the same time, we will continue to plug funding gaps for innovative startups with novel and disruptive ideas.”
“As long as they are willing to change their mindset, put in place a good system, we will be there to help them. Given the small size of our domestic economy, businesses in Singapore need to serve not just Singapore, but the world. SMEs should ride on the growth of Asia, as well as the continued recovery in the US and Europe, to seize growth and opportunities. There are two aspects to this. What do we do? First, we will continue to enhance international economic linkages and improve our trade infrastructure so as to increase the opportunities for our businesses. We have an extensive network of 21 Free Trade Agreements (FTAs) and Economic Partnership Agreements with countries, such as China, Japan, Korea and the United States. Much of this work done by the Ministry is invisible to many. At these difficult negotiations, sometimes you give some, you take some; you win some, you lose some. They are not easy negotiations. But we have 21 FTAs that will help the businesses. Ongoing negotiations of the regional FTAs, such as the Trans Pacific Partnership (TPP) and Regional Comprehensive Economic Partnership (RCEP) as well as with individual countries, such as Turkey, will further enhance our trade positions and help our businesses. These FTAs help our businesses to reduce costs, lower risks and enter new markets. For example, the European Union-Singapore FTA is the first bilateral FTA which will allow processed Asian food products made in Singapore, such as chicken and pork floss, samosa, canned luncheon meat, fish balls and crab balls, to enter the EU tariff free, within an annual quota. Second, we will continue to help our companies leverage on trade networks we have developed, to internationalise more successfully and become globally competitive players.”
“Having talent is important. In the coming years, MTI will partner MOM, MOE and the industry to prepare Singaporeans for the specialist, managerial and leadership roles in the economy. We want Singaporeans to have meaningful careers and good jobs that will help them to realise their dreams and aspirations. As the Member Mr Dhinakaran has mentioned, our SMEs employ 70% of our workforce and also play a major part in contributing to the economy. They are the backbone of our economy. SMEs need well-trained talents in their companies too. They need motivated Singaporean workers who can find meaning in their work and will also help the SMEs and take them to the next level. The Government will help these SMEs to be employers of choice. We will actively help to connect graduating students with SMEs. It was mentioned by one of the Members, we have the SME Talent Programme. This was launched late last year. We have already matched 400 graduates from polytechnics and ITEs under apprenticeship or for employment to SMEs in the F&B, retail, services, manufacturing and engineering sectors. We need to continue to work closely with our Trade Associations and Chambers and hope to match 4,000 students to SMEs over the next five years. Page: 89 At the same time, SMEs need to make themselves good employers. They need to put in place good compensation packages, good human resources practices and also be able to plan a good and rewarding career path for these graduates. We will need to prepare these SMEs to be able to recruit these talents. We will help them through different measures, grants and schemes to acquire such expertise and revamp their approach to talent management. These SMEs need not have to be large ones. They can be small and micro ones.”
“We want to help SMEs and large organisations to come together so that SMEs can gain experience, improve their quality of goods and services, and develop a track record. Since 2013, SPRING has helped 193 SMEs partner with large organisations through 51 projects. We continue to provide strong support for such collaborations and projects so that SMEs can upgrade their capabilities through these various initiatives. Page: 88 Manpower is an issue that many Members have raised, but it is a fundamental constraint for Singapore. We cannot grow our workforce indefinitely. SMEs, therefore, need to adapt and push for higher productivity. They can bring about sustainable and quality growth if they have higher productivity. Many companies have been successful in doing that. An example is Dian Xiao Er, a Chinese restaurant famous for its herbal roast duck dishes. It has raised productivity through several methods, including outsourcing of some food preparation like cutting and marinating of meat to its food manufacturer, using biometric readers to record staff attendance and training staff to improve on their service delivery. These are the SMEs who changed their mindsets, believed in efficiency, improved their productivity and strengthened their positioning in the marketplace. To date, half of the $2 billion National Productivity Fund has been committed, with much of this going to SMEs. The Government has also set aside more than $300 million for the next three years to support SMEs in restructuring. Beyond funding, we will continue to ensure that the broader ecosystem of support is there. To ensure that Government schemes are accessible, we are continuing to simplify grants and application procedures and expand the network of SME centres to help the SMEs.”
“This is critical because Singapore is small and many of our businesses need to serve the international market to grow and thrive. So, how can we help SMEs to strengthen themselves? The Government understands the difficulties that our SMEs, particularly the smaller ones, are facing. We are committed to providing strong support for SMEs during this transition. We need to upgrade their capabilities. We need to strengthen them, upgrade their capabilities to position them for growth. For some, it is about survival, but for all, we try to make our schemes and programmes inclusive. One important way is to educate them and help them build capabilities through technology. Since July 2013, we have engaged more than 2,500 companies to understand their technological needs and benefited more than 300 companies. We will push ahead with the efforts to implement technologies into their businesses and processes. For example, through technology matching, Manja Delights Kitchen, a family business in Taman Jurong, implemented Snap2Tell, an image recognition technology developed by A*STAR. By scanning Manja Delights Kitchen's logo and name card, potential customers are able to access their menu as well as place orders of kuehs online. This reduces the number of phone calls from customers, hence increasing the owner's capacity to do what they do best – making kuehs. So they focused on their core competency, and outsourced the rest of it. Technology helps them to streamline the processes. We will also facilitate collaboration – this is one of the key targets this year. We will ensure that we have programmes, measures and policies to consider how to encourage collaboration between SMEs and big companies.”
“Sir, I rise to thank the President and speak in support of the President's Address. As the President said, we stand "at an important moment of our history". Singapore has done well, but if we are to continue to do well in the next stage, we will have to carefully chart the journey ahead and press on together. I will focus on the economic domain – how we can keep our economy vibrant, enable Singapore businesses to grow, thrive and create good job opportunities for Singaporeans. Let me touch on the economic outlook. We believe the economic outlook will be positive moving forward. But we are cautiously optimistic. The US and the euro zone are recovering. Asia continues to be resilient with a rising middle class. However, we face stronger competition, as well as fundamental domestic resource constraints, especially for land and manpower. Businesses, big and small, will need to adapt and adjust to these realities. The Government will help our businesses make the necessary adjustments. A vibrant economy, with strong and growing companies, is critical to providing good and diverse job opportunities – jobs that Singaporeans want, jobs that Singaporean workers with different strengths and aptitudes can excel in, jobs that give Singaporeans the chance to upgrade and improve their lives. Page: 87 The Government is pursuing a wide range of initiatives. We are investing in R&D, helping firms to raise their productivity and acquire new capabilities, encouraging new start-ups and innovation. We are working hard to keep business costs manageable, building new industrial spaces and ensuring that energy is competitively priced. We are also continuing to expand our network of free trade and investment guarantee agreements to help businesses export and invest overseas.”
“Sir, may I have your permission to display some slides on the LED screens for my speech.”
“The data and the information that I have got is an aggregate, which means it is averaged out. There are different experiences and practices between landlord and tenants because of the contractual arrangements. At different locations, they will experience different commercial practices. The landlord may have a different mix of shops and tenants that they want, and so there are different types of contractual arrangements. That determines some of the rates that may apply to the tenants. We are unable to go into such specific breakdowns such as by buildings. But on the whole, the intent is that as far as we can, we are looking for the sources that make sense. Perhaps by geographical points, within an area, and we can say how high or how low the rental index is in that area by comparison. We are still determining the sources and we are collecting the data and information with the help of associations and Government agencies. It is not just data from the Government agencies, but also from associations, practitioners and stakeholders of the market. We intend to do this and complete Page: 65 it within this year. We hope to do it as soon as possible, but we have to make sure that the data is accurate, comprehensive and complete.”
“I do not have the information at the moment. We will now have to plan to see how much out of the 500,000 sqm is for GLS and how much for development by JTC. I do not have that information; I could provide that later.”
“Madam, it is not 5,000 sqm. It is 500,000 sqm – that is double the annual demand. That is both JTC development as well as private development, which means that it would be through the Government Land Sale (GLS) Programme. What JTC is trying to do now is to play a more developmental role which is really to help SMEs and start-ups. Recently, we launched a larger area for new businesses and start-ups. We are also clustering spaces by industry, for example, goods manufacturing. Industries that seem to lag behind in the productivity movement, we help them to intensify space usage, or we can call it land intensification. We will cluster and build purpose-built factories for these companies to use and keep a balance. The supply of space will increase tremendously. That should moderate the general industrial space demand. For HDB, I guess I have to leave it to MND to answer that question. Through the SME Workgroup, we have MND and HDB representatives in there. We are all coordinating to make sure that we are monitoring all rentals throughout the different space, to make sure our SMEs do not face tremendous increases in terms of rentals. For reasons of making sure that there is fair practice and also making sure that the inflationary measures that may impact the rental cost, are reduced. We are looking at all these different measures to see what we can do. Within this year, we will come up with more transparent data and more information in terms of a rental index to make sure that both tenants and landlords have a sense of where their rates are and how they can have a sense Page: 64 of comparison to make sure that rentals are fair throughout the location. Er Dr Lee Bee Wah: May I ask what proportion will be by land sales and what proportion will be developed by JTC directly?”
“At the same time, we are also trying to empower the associations that have been set up overseas, like SinCham, the different offices that are set up, empower them to be able to bring their companies that are overseas together. Essentially, it is both ways. Both here and there, we have to coordinate. SPRING and IE undertake such a role to facilitate this whole process. And we definitely want to beef up our resources to do that. Page: 39”
“For co-innovation projects, usually there will be some costs upfront that would need to be paid. If let us say it is a cooperation between a large and a small company coming together to develop the project, we usually try to encourage them to tap on some of our research institutes or agencies like A*STAR and so on to help to facilitate the whole process so as to help not just the cash flow but, more importantly, the content of the innovation project. How we can help both sides. SPRING, A*STAR and IE are agencies that are there to help facilitate the process, including resolving some of these issues. It is important for the SMEs, or even the large companies, to surface these issues so that they can work it out. We have done it before. We have overcome such challenges before to facilitate the process of bringing big and small companies together, especially going overseas. These are companies with a very small market. The size of that company is only that big. If they individually go out there to bid for overseas projects, sometimes their probability of success is very low. We always encourage them to form consortiums, look at major projects, because at the government-to-government level, we have very good relations and the trade growth has increased in many ways, say, for example, in big markets like China. But the project in China is relatively large. We need these smaller companies to group together, look at the opportunities and go for them. And many other countries, for example, the Taiwanese, Japanese and Koreans, are doing the same. In order to help facilitate that, we are now reviewing some of our programmes, schemes and policies to facilitate that process.”
“To answer Ms Tin, they have various scenarios. Some of them change their business model, others just close up and go back to corporate life; and sometimes they become a second-time entrepreneur. It really depends on the situation and on the entrepreneurs themselves. The closure rate itself has not been climbing; the trend has been very steady. We are monitoring that very closely. If there is any prevailing trend coming out in prominence, we will track and see what is the issue there. Page: 165”
“I would like to assure Mr Inderjit Singh that we are measuring that. In fact, the SME Workgroup meets very often with the retailers or the retail associations to measure the closure. I do not have the exact numbers right now, but the last seen trend is that it is not increasing at a very high rate, even for the F&B sector. We are monitoring it. It may also be because there are new entrants. There are a lot more new entrants into the sector. We are not seeing fewer entrepreneurs. In fact, we are seeing quite a vibrant entrepreneurship landscape today in the different sectors, such as the services sector. If you look at some of the shopping malls, you can see that sometimes there is change-over but you do not really see vacant space.”
“Mr Chairman, with regard to Mr Teo's question, with less than three employees, the company cannot apply for the cash payout portion of the PIC. But for the PIC tax deduction portion, it can be done. On the requirement of having at least three local employees: when I did my rounds to visit the smaller and micro enterprises, I found that a lot of them do not need massive and immediate investments. They are actually more suitable for the voucher scheme, which is the Innovation and Capability Voucher (ICV) scheme. For ICV, it is $5,000 per voucher. The companies are entitled to eight vouchers. I encouraged them to do so and now they have a better awareness about it. Once they are better aware, they can apply for it. And for the ICV, when the Page: 163 companies get reimbursement, it is within two weeks.”
“Today, many home-grown brands are already household names. Most Singaporeans know Jumbo Seafood and Eu Yan Sang. Other SMEs have achieved recognition overseas. Crystal Jade is popular in Hong Kong and OSIM has a strong reputation in China. These SMEs make us proud, and the Government will support more SMEs as they work to reach such heights. With effort, I am confident that SMEs will continue to grow and create good jobs and better jobs for Singaporeans.”
“MTI recently announced changes to the time-share regulations that will take effect in April this year. These changes will expand the regulation's coverage to cover relevant products, such as holiday club memberships. They will also prevent companies from collecting a deposit from consumers during the five-day cooling-off period, and ensure that consumers have all the relevant information needed when making purchases. Mr Png Eng Huat has asked about the recourse available to consumers who have already purchased timeshares and think that they have been scammed. Unfortunately, the regulations only apply to new contracts, and do not cover existing contracts. For clear cases of cheating, the party should make a police report. I urge consumers to consult the Consumers Association of Singapore (CASE) if they need advice. Page: 160 While we cannot enforce the regulations retroactively, we can do more to ensure that our consumers' interests are not adversely affected. CASE will reach out more to consumers to educate them on their rights to reduce future cases of cheating. I believe CASE is continuing to monitor how badly the consumers are affected and how many cases of complaints they receive each day. In conclusion, the Government will continue to help SMEs enhance their productivity and develop new capabilities. We will also continue to cultivate a climate of entrepreneurship in Singapore. SMEs and entrepreneurs must also take the lead and embrace the restructuring process. We are seeing progress but there is more to do. SMEs in countries like Germany constantly upgrade themselves so that they can become market leaders in their respective niches. It will take time, but we will move along in this journey together with our SMEs.”
“This builds on the success of the original start-up hub at Block 71. Block 71 has drawn global attention to our entrepreneurial culture. Earlier this year, it was covered in the Economist magazine, which featured the opportunities for startups to interact and work together. Block 71 currently houses 23 incubators, Page: 159 250 startups and 1,000 entrepreneurs from the infocomms and media cluster. This compact seven-storey block provides a collaborative environment for like-minded entrepreneurs. Being sited with fellow startups and potential investors meant that discussions happened quickly. Deals can be made, capital investments are made and they can pitch ideas at any point in time. We want to be able to provide that platform, a larger one, for more people to be involved and, in turn, set up a culture, the spirit and an ecosystem for entrepreneurs. By the end of this year, JTC will open two more blocks as part of an incubation cluster called JTC LaunchPad@one-north. This is adjacent to Block 71; so, we will have Blocks 73 and 79, and these will nurture the growth of startups and incubators in promising industries. The expansion will double the current community at one-north to 500 startups and 2,000 entrepreneurs, and provide more common spaces for startups to interact, share ideas and make deals. As Members can see from the layout, there will be Blocks 71, 73, 79 and there will be community space, cafes, bistros and eateries for them to mix. Hopefully, we can create our own mini-Silicon Valley. If there is sufficient demand, the Government will consider creating more startup clusters around Singapore in the future. We will discuss more details of JTC LaunchPad@one-north later this month. Let me move on to the issue of consumer protection.”
“45 pm It is not just about getting grants. More importantly, it is the networking and the mentorship that come along with it. We offer this mentorship not just for grant awardees, but also to those who are interested to set up. We try to do the match between mentors and mentees. Mr Chen Show Mao has asked about support for older Singaporeans interested in entrepreneurship. We want to encourage older entrepreneurs or seniors to embark on entrepreneurship. We do not discriminate against age, nor the nature of business – whether tech or non-tech. We can all be inspired by 69-year-old Ms Shelley Siu, who founded The Singapore Shawl, in 2003. The company designs shawls that feature Singapore's culture and makes them from eco-friendly products. Besides Singapore, the shawls are sold overseas in the US, UK and France. Ms Siu said that her reason for starting the business was to give back to her community. She hires local women, mostly senior citizens or those who are in need, to work in the stores or as seamstresses. Ms Siu did not require any Government support to start her business, but others may need help. For those who need help, we encourage them to approach ACE and SPRING to find out more about the help schemes. As Members would know, I am also trying to let ACE be led by the private sector. I believe that in doing so, it would keep the entrepreneurship scene and landscape a lot more vibrant. This is aligned with the recommendation in the Entrepreneurship Review Committee's report, which was completed this year. Another significant recommendation was for the Government to provide more physical space to incubate startups. I am happy to share that JTC will be developing new incubation spaces, more than what we have today with the famous Block 71 at JTC's one-north.”
“We want to encourage people – young people, old people – regardless of age to embrace entrepreneurship, take risks and come up with new ideas. We would like to grow Singapore into an Entrepreneurship Hub. The Government set up ACE (Action Community for Entrepreneurship) 11 years ago. The mission of ACE is to develop an entrepreneurial culture and a pro-enterprise environment. ACE and SPRING together provide access to funding, mentorship and infrastructure support. As Members know, since I took over ACE, one of the first things I changed was the ACE Startups Grant. It used to have an age limit. Today, there is no more age limit. The ACE Startups Grant provides first-time entrepreneurs with tax exemptions and funding support, matching $7 for every $3 raised by entrepreneurs for up to $50,000. There are other schemes. SPRING's Start-up Enterprise Development Scheme (SEEDS) co-invests with third-party investors in promising startups. With this support, the number of active startups in Singapore has grown by almost 60% in the past seven years. I would like to share with Members an example of Ms Ee Poh Luan. She is a successful example of someone who made entrepreneurship a second career. Luan worked for 20 years in the communications sector before deciding to follow her passion in cooking. She signed up for two stints as a kitchen intern in different restaurants and then decided to become an entrepreneur. She was awarded the ACE Startups Grant and was also assigned a mentor to help her develop her business model. Since the start of last year, Luan has been Page: 158 operating her gourmet food truck – the Kerbside Gourmet. This mobile kitchen is also a social enterprise. Luan channels a part of her profits to feed low-income families. 6.”
“The adviser also recommended for Aftershock PC to automate its ordering process. Aftershock adopted the idea and it tapped on the PIC to invest in a platform for customers to order its products online. This has made the orders more accurate and less labour intensive. With Government support, businesses are better placed to restructure and transform. The scheme has helped to provide product innovation – the way the sales process is done. With the business process re-designed, that increased the revenue stream. It also helps in covering talent gaps in the company. We are trying to help as many businesses as we can but businesses must help themselves first. Nonetheless, some firms will find themselves in non-viable business lines. Ms Tin Pei Ling has asked about our support for these Page: 157 displaced SME owners and staff. Unlike Europe which faces structural unemployment, Singapore is in a full employment situation. Thus, we have focused our efforts on helping SME owners and employees move to new, higher value sectors. The Government has a range of schemes to help firms do this as well. The Government also supports training programmes, such as those conducted by e2i, to help workers acquire new skills and do higher value-add job in new industry sectors. MOM will elaborate on these training schemes and other forms of support provided for displaced workers. Let me just say that the vibrancy of an economy is not just dependent on the existing SMEs but also new SMEs as well. Entrepreneurship is a big and major pillar for any vibrant economy because it keeps the economy sustainable and at the same time re-energises the business sector.”
“We will increase the Government's risk-share from 50% to 70% for MLP loans to firms that have been registered for less than three years. This, we hope, will increase the incentives for banks to lend to them. But we will work with the banks and look at how else we can reach out to Page: 156 these SMEs or startups to help them access the loans as well. Senior Minister of State Lee Yi Shyan had earlier also shared IE Singapore's plans to help SMEs venture overseas through enhancements to the Global Company Partnership (GCP) and Market Readiness Assistance (MRA). In addition, IE Singapore's new Market Access Incubation Programme (MAIP) will help smaller SMEs and start-ups internationalise. It will support up to 70% of costs, such as airfare, accommodation, registration fees and booth set-up costs, when they participate in overseas events by approved incubators. These incubators will help to identify potential overseas markets, offer mentorship support and provide seed funding. Taken together, our various programmes provide comprehensive help for all SMEs. The challenge is to create more awareness among SMEs and guide them to access these schemes and to implement them. Let me give this example. The company is called Aftershock PC Pte Ltd, a company that builds customised gaming laptops. Aftershock PC started as a small operation with three employees and now has 11. It sought assistance from one of our SME Centres. The business adviser visited the company. The adviser realised that the SME needed more manpower and introduced it to the SME Talent Programme which I mentioned earlier. Through the programme, it was matched with Mr Kwan Suan Qing. With SPRING's support, it is co-sponsoring his final year in Singapore Polytechnic, after which he will join it as a full-time staff.”
“Some SMEs have shared that they face significant rental spikes when their tenancies are renewed. The Government supports fair practices. To help businesses make more informed decisions about the rental market, the SME Workgroup has suggested that the Government share more rental information. Mr Zaqy Mohamad has also mentioned rental benchmark transparency. MTI and URA have taken this feedback on board and we are looking into publishing more comprehensive shop rental data later this year to make rental pricing more transparent. Mr Chairman, let me now address Mr Yee Jenn Jong's question on how we will help SMEs expand and grow. The SME Committee and the Singapore Business Federation have also shared about the urgent need for SMEs to revitalise their appetite for growth. The Government will encourage more private sector financing and facilitate internationalisation. Several initiatives have also been outlined in this year's Budget speech. Under Phase II of the Co-Investment Programme, the Government has set aside Government capital for two new funds to provide SMEs with both equity financing and debt financing options. The SME Co-Investment Fund II will make direct equity investments into companies, alongside other private equity investors. The SME Mezzanine Growth Fund will provide a hybrid debt-equity financing option for SMEs that do not wish to dilute their equity. And the funds will be managed by Heliconia Capital Management Pte Ltd. It also announced the enhancement of the Micro-Loan Programme (MLP) to support smaller businesses and startups. Mr Yee has also mentioned this. Young businesses face difficulty securing working capital loans as they lack business track record and collateral.”
“We will also build some of these as factories that are customised for particular industries. Ms Foo has mentioned about the aerospace industry. We are going into the food industry as well. That helps the SMEs and we make sure that it is customised for their needs. For some, it may also mean a change in their process in order to fit into some of these factories. As Members know, we have rolled out the small footprint standard factories. Those have had a very warm response from SMEs. We will roll out a similar type of factories that is customised to the needs of the industry. We believe that this is the path towards land intensification and building up the productivity level. Mr Inderjit Singh and Mr Dhinakaran have also asked specifically about the impact of real estate investment trusts, or REITs. We note that REITs are not the leading players in the rental space market because they currently only own about 13% and 16% of retail and industrial rental space respectively. Like any other landlord, they have to compete in the rental market to attract tenants and cannot charge excessive rents. Some REITs buy conveniently located properties, such as those near MRT stations. And they also usually invest in asset enhancements and national marketing efforts which have helped to increase foot traffic to their malls, and raised the revenues of some of the retailers. So, these mall owners usually Page: 155 charge higher rents. Nevertheless, let me assure Members that we will continue to monitor this rental market. We know it has come up as an issue. Many Members have raised it. We will monitor it and we will intervene if we see evidence of collusion or abuse of market dominance by any player, including REITs.”
“Business processes can change in many ways – for example, the procurement process, the stocktake or sales process. There are many different ways to change processes. We believe that if the SMEs are willing to make that change and prove the productivity level increases, it will be included. Thus, the schemes are there for them to use – big and small ones. It just depends on the scale and size of the change, as well as the enterprise itself. Mr Zaqy Mohamad and Ms Foo Mee Har have asked about what the Government is doing to help businesses cope with rising land and space costs. Page: 154 Singapore is land scarce and our land prices and rents reflect this. The retail rental index published by URA has grown at an average of 1.1% per annum over the last four years. Over the same period, rents for multiple-user factory space have increased at an average of 10.3% per annum. However, the increase for the whole of 2013 was at a lower 3.5%, which indicates some signs of moderation. Rents for space are likely to moderate in the medium term as the Government has released a significant amount of land. Over the next three years, about 145,000 sqm of new shop space will be completed each year. This is more than double the average annual demand in the last three years. Over the same period, an average of 500,000 sqm of multiple-user factory space will come on-stream each year. This is almost double the average annual space demand for such space in the last three years. We have also released small land parcels with shorter tenures as more affordable options for SMEs. As Members know, for industrial land, when we roll out, we also will build on some of these lands for clustering the space for industry needs.”
“I welcome Members' feedback to help Page: 153 us make this booklet better and simpler to use. 6.30 pm (In English): Mr Inderjit Singh and Mr Zaqy Mohamed have also asked what the Government will do to help SMEs find suitable workers and cope with rising manpower costs, given our tight labour market. Last year, we launched the SME Talent Programme to attract more young talents to work in SMEs. We believe that if you can attract talents into SMEs, change and restructuring may be able to speed up and mindsets may change. SPRING and its partner trade associations match these students from Polytechnics and ITEs with SMEs, and encourage SMEs to develop exciting career paths for them. Since the launch last year, over the last few months, we have made close to 100 successful matches. There are a lot more matches to go. There are a lot more applicants, both from students and from SMEs. The Government has also been encouraging businesses to enhance their processes and adopt technology to optimise their manpower. We have adopted these suggestions by the SME Committee and SME Workgroup to enhance the ICV scheme beyond procuring consultancy services. Each SME can now use two ICV vouchers, out of their maximum of eight vouchers, to implement solutions. This means the two vouchers can be used to purchase equipment or implement software applications. It need not go through consultancy services. But we believe SMEs still need consultancy services because they may need new ideas and plug some gaps that they may not be able to see after having been in business for too long. Mr Inderjit Singh mentioned that business process change should be recognised as innovation and to be included. I can assure Members, it is included.”
“Let me now address Ms Tin Pei Ling and Mr Heng Chee How's questions in Mandarin. (In Mandarin): [Please refer to Vernacular Speech.] Ms Tin Pei Ling and Mr Heng Chee How have asked what the Government can do to help SMEs who do not know how to improve their productivity or how to access our Government schemes. SPRING and the SME Centres conduct outreach sessions in English, Mandarin, Malay and even dialects, and their information brochures are available in these languages. We are working closely with the trade associations and SME Centres to reach out to individual SMEs. We now have a total of 11 SME Centres, including satellite centres in each of the five Community Development Councils (CDCs). Across the SME Centres, there are about 60 business advisors. They provide SMEs with information on Government assistance schemes and business advice. The business advisers at our ethnic chambers can do so in their respective languages. These business advisers will even visit the SME offices and shops to observe their business operations and offer customised advice. Collectively, our SME Centres have assisted over 20,000 SMEs in 2013, 25% more than in 2012. We have also made our schemes more accessible. Last year, SPRING shortened and standardised its application forms for their Capability Development Grant from 11 to two pages. Next month, they will launch the online SPRING Grant Portal to make grant applications faster and easier for businesses. The booklet that I have distributed contains the key schemes available to address the main SME needs at various stages of their business development. This booklet will be distributed to SMEs through all the trade associations and chambers, as well as the SME Centres.”
“Over the last six months, we have reached out to more than 7,500 SMEs. Let me thank all the Workgroup members and our partners for their hard work. At these outreach sessions, SMEs have asked questions about various Government schemes. Most are technical questions which can be answered easily, such as queries about the application process for the Innovation and Capability Voucher (ICV), or questions about the types of investments that are claimable under the PIC scheme. For cases which require more detailed advice, the Advisors would link the businesses up with the SME Centres. The Advisors have also received feedback that the SMEs are hoping for more assistance to cope with restructuring. The Workgroup has consolidated all the feedback, developed recommendations and shared them with the relevant Government agencies. Some of those recommendations have also been adopted in this year's Budget. As Deputy Prime Minister Tharman announced in his Budget Statement, the PIC scheme will be extended for another three years up to 2018. He also introduced the PIC+ scheme for SMEs, which raises the PIC expenditure cap by 50%, or up to $600,000, for each of the six qualifying activities. We will continue to engage SMEs through the Workgroup to understand their concerns and needs, and we will also keep close tabs on industry feedback and calibrate the pace of restructuring to better support SMEs. The Workgroup is a long-term committee; it does not stop its work with a recommendation. It continues to engage and provide recommendations to the different Ministries. Page: 152 So, I want to assure the Member that we will continue to monitor, take suggestions and give those recommendations to the different agencies.”
“Most importantly, they must be determined, for determination is required for change to happen. Only then will they have a chance to survive. So, everyone must allow these small rabbits to develop slowly. We want to give these micro businesses a chance to grow and provide them with assistance. We cannot just give them the carrots. Instead, we should also help them find the carrots and this is the most important point. Give them the chance to be bigger and stronger SMEs. (In English): Mr Teo Siong Seng also spoke about an SME coordinating agency. As the SME sector is diverse, it is not easy for one agency to look after all the SME issues. As Members can tell, we have so many questions this year for the SME sector. They cover a wide range of areas. I can assure you that there is close collaboration amongst Government agencies to understand SME issues and develop solutions to help the sector. SPRING, as an agency, is always there Page: 151 on a day-to-day basis to help the SMEs. We have also set up an SME Workgroup to look at the strategic measures and initiatives. The SME Workgroup was set up last September to consolidate our efforts to reach out and engage the SMEs and help them provide feedback and provide recommendations to different Ministries to look at what are the SME assistance strategies and schemes that can be implemented. The Workgroup comprises industry leaders from trade associations and chambers, relevant Government agencies, as well as several Members who are present here today. Mr Zaqy Mohamad and Mr Vikram Nair have asked for an update on the progress of the Workgroup. The Workgroup and our partners, such as the SME Centres and Trade Associations and Chambers, have been actively reaching out to the businesses in their neighbourhoods.”
“I personally grew up in the community and I patronise these businesses daily, such as visiting the coffeeshops to have breakfast. I am sure many of you have similar experiences. And because of this, it is important for Page: 150 us to help these micro businesses, encourage them to change in order to survive. The best way to help them is to guide them. I would like to emphasise that all these SME packages and assistance schemes, or what we call "carrots", are available everywhere. "Carrots" actually grow on the ground, I do not know who hung them up on trees. But regardless of whether the "carrots" grow on trees or on the ground, the important point is that we must guide these small businesses, that is, these "rabbits", to eat the "carrots". "Carrots" come in big and small sizes. The small "rabbits" do not have to compete with the big "rabbits" for big "carrots". If they eat the big ones, they may suffer from indigestion, so it may be better for small "rabbits" to eat in moderation. Mr Teo also talked about small "rabbits" which hop around looking for carrots. I think it is not a bad thing that they are hopping around. They may be feeling energetic after eating the "carrots" and hopping around is a good form of exercise that will help them grow. The most important thing is that we are able to guide these rabbits to the right location, so that they get to eat the carrots. Previously, I gave out phone numbers; this time, I will be giving out brochures with addresses and there are 11 of them in all. These SME Centres will provide assistance, particularly the consultants at the centres, who will lead and guide them. There are many packages now. These micro businesses need to better understand the information so that they can make changes.”
“If we continue with a business-as-usual mindset, these competitors will overtake us. It is not just another country or another city but, even within an industry, SMEs against SMEs, you will see the differentiation. This will erode the competitive advantage that we have worked so hard to build. Change is never easy but it is necessary. Most of the SMEs that I have spoken to understand this and they have already started to restructure or they are trying to figure out what they need to do to restructure. Surveys have shown that more SMEs are measuring their productivity improvements and many have taken up the various Government schemes. Mr Teo Siong Seng will be glad to know that most of these are also available to SMEs, including micro enterprises, even if it is below three employees. For example, more companies have made PIC claims. There were 45,000 PIC claimants in 2012, which is a 25% increase from 2011. More than three-quarters of these claimants were small and micro enterprises. And the PIC scheme is not just meant for larger companies. Micro-enterprises qualify for the tax deduction. Only the cash payout option requires businesses to have at least three local employees. So, over 16,000 micro-enterprises have claimed for PIC. And, in fact, micro-enterprises have shown the greatest rate of increase amongst these claimants, increasing by over 40% since 2011. Let me also address Mr Teo's question in Chinese. (In Mandarin): [Please refer to Vernacular Speech.] Small and micro businesses are very important to us. Mr Teo Siong Seng says they are part of our culture, and I agree with him. Some of these micro businesses have a long history. Not only do they contribute to our economy, they are also a part of our lives.”
“With your permission, Mr Chairman, I have asked the Clerk to place booklets detailing our SME schemes on the Members' seats. I have also included an FAQ questionnaire because of the various questions raised about SMEs accessing the schemes. Several Members have spoken about SMEs and how restructuring has affected them. I thank all of them for the comments and suggestions. And, Mr Chairman, I agree with you that small is beautiful and we are here to help these SMEs to make them more beautiful through restructuring. The restructuring effort is tedious and difficult. However, if you change your mindset, it may just get easier. They can tap on the schemes we have to start this journey of restructuring. We started the process a few years ago with the objective of achieving a productive, competitive and vibrant SME sector. However, it is not an easy journey. I know that restructuring has been painful for some businesses. A clothing retailer told me that high rental costs have forced him out of business or move to a smaller office, and his profit margin is shrinking with the increase in foreign worker levy. Another SME in the precision engineering sector is relocating part of its business to Thailand and Iskandar Malaysia due to the Page: 149 rising costs. All said, I have also noted that the SME sector has continued to grow at a relatively steady pace, with a net formation of about 14,000 new SMEs each year from 2010 to 2012. Easing up on restructuring would not help our businesses in the long run. What we want to do is to strengthen them, not weaken them. And as our domestic economy continues to mature, our cost base will increase accordingly. At the same time, our competitors will not stop innovating and moving up the value chain.”
“These are some of the schemes that we will be looking at to enhance. During the Budget period, we may announce one or two different programmes that can help the SMEs more effectively. 3.00 pm”
“I thank the Member for the question. SMEs face more than labour or cost of operations problems. They also face revenue and opportunity issues as well and competition from other companies or within the industry. Page: 41 The immediate issues are because of policies such as the tightening of foreign labour. We are also watching that to see what sectors are affected. We will be looking at the different schemes and a more targeted approach towards different sectors. We will see what are the schemes or programmes that can help them. At the same time, SME Centres are reaching out to them, not just waiting for them to come. They are reaching out to them, to the small and even micro enterprises to help them understand some of the schemes that may be able to assist them through this transformation process. We need the SMEs to stay the course to be able to go through this transformation. It is not going to be very easy because that would also mean changing their process and their business models. The benefits of the productivity improvements take time to effect. The earlier they start, the earlier they can reap the benefits. That is what we are trying to encourage the SMEs to do as soon as possible. We are looking at the different schemes and also to see what other areas in which we can help them. Most of the SMEs say they have accepted some of the facts where manpower would continue to be a constraint. They know they need to tighten the labour and increase productivity. Through the dialogue sessions, we see that they are accepting that. Now, is to be able to look at how, with the limited resources that they have, can they produce more with less; how can they increase their opportunities in internationalisation; how do they fund some of these opportunities.”
“We will continue to enhance the schemes and look at the challenges that are facing SMEs so that we can help the SMEs more effectively.”
“Since its launch in September last year, the SME Workgroup has been engaging the SME community, and has reviewed the feedback from SMEs on Government policies and processes. Page: 40 To date, the Advisors in the Workgroup have conducted 17 outreach and engagement sessions, reaching out to almost 700 attendees from SMEs across a range of industries. When you take that with the other outreach efforts carried out with partner agencies such as SPRING and the outreach done by the various SME Centres, more than 5,600 SMEs have been engaged over 120 sessions since the launch of the SME Workgroup. The SMEs had given feedback regarding rising costs, particularly from manpower, land and space constraints. In their engagement sessions, Advisors have also encouraged companies to restructure and improve productivity to address these challenges. We have also found that many SMEs are unaware of the various ways in which the Government can assist them in upgrading their businesses. The engagement sessions, with representatives from the relevant agencies, such as MOM, SPRING and WDA, have been most helpful in increasing awareness among SMEs about all the Government schemes. More SMEs are now aware that they can approach any of the SME Centres, which can provide guidance on which Government schemes are relevant for their needs. The Workgroup will also recognise that our SMEs need to focus on growth in order to succeed. There are many Government schemes which our companies can tap on for growth, innovation and internationalisation. We will continue to monitor the needs of our companies, and study how these Government schemes can be enhanced to support our companies to tap growth opportunities. The Workgroup is an on-going effort. It is a long-term effort.”
“Mdm Speaker, for our economy to continue to strive, our SMEs must continue to prosper. The Government is paying close attention to the concerns of our SMEs, and will support them in their transition to higher productivity. Our SMEs understand this and I am pleased to see that many SMEs have come on board this restructuring journey. We have many schemes; our concern is that SMEs do not use our schemes. We will reach out to and assist all able and willing SMEs. The Workgroup I chair will do the utmost to find ways to help SMEs so that they can access the schemes most relevant to them. Enterprises, on the other hand, should also do an internal check to see in which areas innovation and Page: 95 changes are needed. We hope that SMEs will be able to take root under this big tree of Singapore and prosper. The Government must work hard; at the same time, the enterprises must also work harder and transform. So long as we work together, through productivity improvement and innovation, we can achieve quality growth and create good jobs for our people. [(proc text) Question put, and agreed to. (proc text)] [(proc text) Resolved, "That Parliament do now adjourn." (proc text)] Adjourned accordingly at 5.50 pm. Page: 96”
“Just as the Government has a hotline for catching snakes, we also have the EnterpriseOne hotline, which enterprises can call to get comprehensive information on Government assistance schemes. The hotline number is 68981800. Businesses can also access the EnterpriseOne website for the same information. Companies which prefer face-to-face advice can approach any of our SME Centres or satellite SME centres. The Government has expanded the Enterprise Development Centres (EDCs) into a one-stop SME Centre and set up five satellite SME Centres at the Community Development Councils (CDCs). These centres offer comprehensive advisory services to SMEs and help them understand the Government's various assistance schemes, making it easier for them to get help. Since the launch in April, the SME Centres have reached out to more than 7,200 SMEs to explain and promote Government help for raising productivity. We will work even harder to reach out to about 20,000 SMEs per year, up from the 14,000 SMEs under the EDCs. Let me share with Members one example. Roxy Apparel is a small retailer that specialises in tailored menswear. Roxy tapped on SPRING's Capability Development Grant (CDG) to increase productivity and improve customer experience. The company put in place an IT infrastructure to better engage customers through their website, online store and the online community. It also simplified its in-store and online ordering through an iPad interface, allowing each sales employee to reduce administrative tasks and serve the customers more effectively. The company's labour productivity has improved by 20%. This and many other examples make me optimistic that businesses are making the necessary changes to improve their productivity.”
“For example, Globaltronic Precision, which makes chemical products for the aerospace, marine and medical sectors, relocated in July to JTC's Small Footprint Factory in Buroh Street. Their rental decreased by close to 40%, even though the total floor area remained the same, and productivity increased significantly. JTC has been engaging many industries, such as furniture and food manufacturing, to understand their infrastructure needs. In the next phase, it will be by cluster development and more of such projects will be announced in due course. Mdm Speaker, I would like to continue in Mandarin. (In Mandarin): [Please refer to Vernacular Speech.] Mdm Speaker, we will continue to pay close attention to the needs and challenges of our SMEs. I chair the SME Workgroup which Mr Teo mentioned, which brings together grassroots advisers, Government agencies and business representatives in a concerted effort to address SME issues. The grassroots advisers have started holding dialogue sessions with SMEs to share ideas for improving productivity and to hear their concerns. The SME Workgroup will take the feedback raised and study how we can further help companies during this restructuring period. There are many Government schemes available for businesses to build capabilities and improve productivity. During the SME Review last year, SPRING and IE Singapore streamlined their Capability Development and Internationalisation schemes to make them more accessible to our SMEs. Hence, it is not that SMEs have nowhere to seek help, but that some of them do not know the agencies to approach and which schemes are relevant to their Page: 94 needs.”
“Commercial rentals declined slightly in 2012, after increasing in 2010 and 2011, and have remained relatively unchanged in 2013. Current commercial rentals are still below the previous peak of mid-2008. The Government will continue to monitor rentals carefully, and we will also introduce additional measures if necessary. JTC develops long-term land use plans which are regularly reviewed. The plans ensure that there is sufficient affordable land and space for genuine industrialists to support and develop our manufacturing sector. Importantly, the land use plans also ensure that the productivity of the land continues to improve. Mr Teo raised the issue of lease renewal. Singapore is a small island nation, and all land, including land for industrial space, is precious. So, every single application for lease renewal is assessed to ensure that the industrial use fits the long-term plans in strengthening our economy, and the land productivity continues to improve over time. As a result, some companies may not be able Page: 93 to have their leases renewed. JTC actively engages its customers at least six years before the expiry of their lease, and provides at least three years' notice if a lease cannot be renewed. This way, companies have enough time to find alternative premises. To provide more options for companies, JTC is developing infrastructure projects which reduce business costs for SMEs through innovative designs and provision of shared capital-intensive facilities. SMEs can consider moving to these developments, which include the Small Footprint Factories Mr Teo has mentioned, and the Surface Engineering Hub and MedTech Hub, which will be completed by early 2014. The advantages can be considerable.”
“Mdm Speaker, I would like to thank Mr Teo Siong Seng for introducing this motion on Sustainability of Small and Medium Enterprises (SMEs). SMEs are an important part of our economy. They make up 99% of companies, employ 70% of our workforce and contribute to 50% of our GDP. Page: 92 The need for SMEs to restructure and improve productivity is clear. Our challenges, in manpower, land and energy, are especially sharp because we are a small country. We need to manage our resources carefully. SMEs which rely heavily on manpower or land have faced rising costs. Singapore Chinese Chamber of Commerce and Industry's 2013 SME survey has found that many businesses understand the need for increased productivity, and are working hard to do so. Mr Teo has highlighted the difficulties our SMEs face with rental increases. The Government's overall objective is to maintain a stable and sustainable market where rentals remain competitive and affordable for businesses. While HDB does not divest its commercial space to private companies or owners or established REITS, we have released a significant amount of land through the Industrial Government Land Sales (IGLS) programme. And over the next five years, about 340,000 square metres of new multiple-user factory space will become available each year. This is higher than the annual demand of 220,000 square metres over the last five years. We have also released smaller IGLS land parcels with shorter tenure, to provide more affordable options for SMEs. Over the next five years, about 230,000 square metres of new office space and 120,000 square metres of new shop space will be completed each year. This is higher than the annual demand of 140,000 square metres of office space and 70,000 square metres of shop space over the last five years.”
“Definitely, we will look into it and look at different ways of communicating. What is the most important is that it is not just going to be a national level push on promotion, and creating awareness through advertisements and promoting it generally or in the mainstream media, but we are going to be walking the ground, and going on the ground to engage the different businesses and organising dialogues, and so on. I also urge Members and advisors to assist in this process. It is important that we touch the ground in every area, every constituency, where possible.”