Thomas Thomas
Singapore
“Can I ask the Minister whether he can consider it a competition when commuters do not have a choice, whether they are being served by SBS or TIBS? They have to live with whichever public transport company runs the route along where they live or want to use?”
“Would the Minister consider that Singapore being very small and if there is one company sharing resources, just like the banks are being encouraged to merge and share resources and skills, we will have an even better public transport system?”
“Mr Speaker, Sir, I just want the Minister to clarify, because I do not understand. If it is managed competition with two, why can it not be managed competition with one? Since we always say that we are short of players, we have a concentration of players to give even better services.”
“One is whether Government will recruit; two is how do we prevent wages for lower income dropping too low such that they cannot maintain their living standards? And the third question is this.”
“The bulk of TIF is invested with established VCs. Several were able to raise more than their targeted fund sizes, though some of the first time early-stage funds (which are meant to help develop local VC expertise) are seeing a slow-down in fund raising and deal flows.”
“Sir, I am pleased to say that most of the points that I had wanted to bring up have already been addressed by the Minister. However, I would just like to ask what are the acceptable international standards for noise levels, in decibels, from expressways, and what is the general noise level from our expressways? 1.45 pm”
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“But has DBS met its objective of meeting customers' needs and requirements? I would ask the Minister to review whether DBS has kept faith with the original terms of sale and, if not, for the greater good of all Singaporeans, to review it again and let us take a new look at this. BG Lee Hsien Loong: Sir, I thank Mr Sin Boon Ann and Mr Thomas Thomas for raising this problem of DBS-POSBank. The issue is in the public eye again because of the recent branch closures and some ATM relocations, and also the introduction of bank charges by DBS. Let me briefly recap why the Government allowed POSBank to be acquired by DBS and then explain the current situation. For more than 25 years, POSBank was a leader in providing basic retail banking services to the community. 95% of adult Singaporeans had POSBank savings accounts. Mr Sin Boon Ann was one of them, so am I, so are most Members. But POSBank was losing money on its small accounts, and three out of four of its accounts were not commercially viable, and it was trying to cross-subsidise smaller depositors, using margins from the larger accounts. It could not really continue doing this, because the bigger depositors were taking their business to other banks offering higher returns and more sophisticated products. So POSBank was losing market share and, in fact, had to reverse its strategy of paying lower accounts higher interest, and to pay bigger accounts higher interest, in order to try and reverse this tendency. But the strategy of cross-subsidising small accounts was not sustainable, and even if DBS and POSBank had not merged, POSBank could not have continued offering free banking services to all customers indefinitely.”
“Sir, I would first like to thank Mr Sin Boon Ann for covering quite a lot of things that I had wanted to say, and quite eloquently. He has made my job much easier. Just to add on to what he has said on banking services, one of the points that the Minister told us when selling off POSBank was to satisfy customer demands. I would like to ask the Minister to review whether this objective has been really met, because when we go down to the ground, most people seem to be unhappy with the services they get under DBS than what they got before. DBS seems to be very successful in being driven by the profit motive. I have nothing against it. I know that we need to have a commercially successful bank, but it also has social responsibilities. In the past, when we tried to encourage workers to go for cashless pay, POSBank was there to render the service. When we tried to encourage savings, POSBank was there. And POSBank made the arrangements to put ATMs near workplaces convenient for workers to withdraw money and go along with cashless pay. But now the whole philosophy has changed. I know of a place where DBS gave two weeks' notice that the POSB ATM would be withdrawn in two weeks, and a lot of workers were affected. They complained, but before even an appeal could be done, before the two weeks were up, the machine just disappeared. We can say that there is efficiency, but I do not know whether it is efficiency when it gives people two weeks' notice and before the two weeks are up, the machine disappears. But it causes people to feel very unhappy and that they have not been well taken care of or well treated. When DBS took over POSBank, they had a captive audience, a lot of goodwill. And thanks to the POSBank network, I think DBS is making profits, which is all right.”
“I will be very brief and cut down on what I have to say. On pensioners, during the debate on the Budget Statement, four Members of this House spoke on the need for the Government to be more generous to pensioners. The Minister's response was that the adjustments more than cover the increase in cost of living and there were other perks for pensioners. I would like to say that pensioners are people who worked hard in the past to contribute to our present prosperity. In the past, we were told to tighten our belts, make sacrifices and pensioners who were in that period made those sacrifices. Those were the days when the budgets were not generous, not so painless, but they made sacrifices. Today's impressive reserves that we have, the prosperity we have, all the good things that we have, were built up by the past. I also want to say that when you make pension adjustments, do not just make adjustments on cost of living. We also have to take into account the standard of living. Our standard of living changes, the things that were not relevant then may still be applicable today. And this must also be covered. I am just saying that the 12,100 pensioners deserve more, and I hope the Government would have put in place a mechanism which we can make periodic adjustments to pensions, not just once in many years, but more frequently and in more substantial and significant quantums.”
“Can I proceed to my next cut, Sir? 1.45 pm”
“In the civil service, a civil servant has to be classified as an employee under this Act if he wants to enjoy the benefits of the Industrial Relations Act, and it has to be declared by the President for the purposes of this Act. If a civil servant is not classified as an employee for the purposes of the Industrial Relations Act, this employee does not have access to collective bargaining, conciliation or arbitration. I am aware that the President has declared Division IV and daily-rated employees, clerks, nurses and a lot of others in Divisions I, II and III as employees. But some of their job titles have not been updated. I am also aware that many a time, when the civil service reaches an agreement with the unions, they have points of agreement and exchanges of letters. However, whenever there are disagreements on these exchanges of letters or points, these are not enforceable because the aggrieved party cannot bring it up for conciliation or arbitration. So there is a weakness. Sir, what I am asking the Government to reconsider is: on the one hand, it has a symbiotic relationship with the unions and recognises their contributions, and we all say positive things and there is a lot of support at national level, on the other hand, there is also a need to promote bipartite relations in the civil service. If that can be done, it would also help the civil service to be more attuned like the private sector and respond quickly to changes. This can only be good for the civil service. I ask the Government to review this practice of classifying employees, for the purpose of the Industrial Relations Act, and to set standards which are equivalent to that of a private and statutory board, since for all things, you want to set the benchmark. Be a leader in industrial relations.”
“Sir, the employer in the civil service is the Government. At the same time, the Government has a political face and a political role in making rules. And in that political role in making rules, the Government claims that it has a symbiotic relationship with the unions. And because of this peculiar situation of the Government in the civil service, how people are managed in the civil service is also the model that is looked upon by the rest of society. So it is important that the Government has the right model and sets the right examples in managing people in the civil service. Recently, the Government has made some changes to the management of people in the civil service. Ministries have been decentralised with powers to manage their own personnel matters. These are good moves because they will enable Ministries to respond quickly to changes and make them more effective to recruit, retain and develop people. If we look at the measures that the civil service has introduced, such as changes in medical and other benefits, it has done it fairly responsibly. If we look at the overall report book, if we have to state, I think it will pass - not very well, but pass - because if we look at protection for employees, etc, they have done well. Is there social dialogue? Yes, there is. Are people having a part in the industrial relations structure? Yes, they do, but more could be done. I think one area of deficiency is in the implementation of the Industrial Relations Act. This Act is meant to provide for the regulation of relations between employers and employees, and the prevention and settlement of trade disputes by collective bargaining, conciliation and arbitration.”
“And it must also mean allowing them to come home quickly. Sir, I hope that there will be a review of the system and there will be improvements in the public transport for Jurong Island workers. And I hope it will be more convenient, cheap and more comfortable.”
“Sir, first, let me declare that I am a member of the Public Transport Council, but I am not speaking on behalf of the Council. On the topic of public transport for Jurong Island, I want to say that Jurong Island is an impressive development. Just looking at the sand that is poured into the sea to reclaim land, it must have cost billions of dollars - $5 billion or more. And just driving around looking at the oil refineries, chemical plants, petrochemical complexes and the utility providers, it must also amount to billions of dollars of investments - $10-$20 billion, a lot of investments. All these investments can only yield returns with the people who are working there. Sir, I notice that lots of incentives and privileges are given to the companies in Jurong Island. However, on the question of public transport for the workers to man the plants and industries, more could be done. At the present moment, the public transport that goes there uses the farecard system. But our people who use the farecard have to pay 10 cents more than normal fares. And the reason is that the buses that ply there have to pay COE, and the workers pay for the COE. But for the rest of Singapore, because they are public roads, the SBS and TIBS buses do not have to pay for COE. I think this is an anomaly. I have driven along Jurong Island. I do not see the roads in Jurong Island any different from the roads in Jurong Industrial Estate or, for that matter, the rest of Singapore. So why should Jurong Island workers have to pay for COE when the rest of us do not have to? Moreover, we say that we are going to have a world-class transport system. I think world-class transport system must include bringing workers to work as quickly as possible, as cheaply as possible and as safely as possible.”
“Sir, I would also join my colleagues, Dr Ong Chit Chung, Mr Ravindran and Dr Jennifer Lee, in asking the Minister to review NS allowance as well as make CPF contributions. I agree with them that it will not just help families. It will also help in our pro-family and procreation policies. The fundamental thing is that people have already sacrificed and made a contribution and I think we should not make them lose out, in terms of opportunities. The other arguments which I have have already been put forward quite eloquently by my colleagues. [Mr Deputy Speaker in the Chair] 4.44 pm”
“While it will take time for privatisation to take place for all GLCs, in the meantime, there should also be greater transparency of how GLCs are managed. Policies and incentives for such companies should be market-driven. The Government should avoid giving undue subsidies which I feel may just hide weaknesses of such companies. We end up doing a disservice to the GLCs because in the long term, they would face problems when competing in the real world, where there is true market competition when in fact the GLCs have been used to an "easier than market" governance approach that we have created for them. I would like to end by once again expressing that we are heading in the right direction of transforming Singapore to a knowledge economy. The Budget announced by the Minister for Finance supports the transition to the new economy. I hope the Minister will seriously consider the suggestions I have made earlier to further strengthen Singapore's position as we compete with the world's best economies. With this, Sir, I support the motion.”
“There is now over-pessimism among investors and VCs. Many are not willing to fund even viable companies. Unless something is done fast to help such companies, we will see a sad situation of potentially good companies seeing a premature end. At the end of last year, the Technopreneurship 21 Private Sector Committee, of which I am a member, requested the Government to set aside a special fund which we called a "Lifeline Fund" to help struggling start-ups that still have fundamentals but are facing cash squeeze that hinders their progress. Many face immediate collapse if not helped soon. I will elaborate on this "Lifeline Fund" during the Committee of Supply discussions. It is, however, really urgent and we must do something before we destroy the good environment that we have created in promoting technopreneurship in the last two years. We need to help some companies that are in trouble right now. Sir, the final point I would like to touch on is the privatisation of Government-linked companies and this is a topic that many Members have spoken about. The reason I am bringing this up again is to suggest that while we have seemingly good GLCs, if we consider how they perform in the local market, the truth of the matter is that they may develop weak fundamentals which would become serious setbacks when such companies compete with global companies outside Singapore. We have seen many examples of how some of these GLCs have failed to compete externally. If we look at the many GLCs in Singapore, the ones that are doing well are the ones that are truly privatised and hence subjected to true market discipline like any private sector company. I therefore hope that the pace of privatisation will be speeded up.”
“A subsidy driven scheme just hides weaknesses and does not give the opportunity for us to develop fundamentally strong companies able to compete in the world arena. It is time we reviewed and restructured the 60-plus incentive schemes existing today and to create a few effective ones. Sir, the third area which I would like to talk about is the promotion of entrepreneurship in the knowledge economy. The last two years had been excellent for us in encouraging Singaporeans to become more entrepreneurial. Many companies were set up and many of our young took the plunge to become entrepreneurs. The technopreneurial excitement was, however, short-lived for Singapore, but this, in my opinion, was for the better because a long drawn period of boom based on hypes and fundamentally weak business strategies could have damaged our economy more and would have damaged the confidence of would-be entrepreneurs even more. After the dot.com bust, there has been a big loss of confidence among entrepreneurs and investors. There are many lessons to be learnt from the last two years of experiences. For example, our budding entrepreneurs have learnt about the need for proper business models, the need to think of a global market place and not Singapore as a market, the need to avoid "me too" ventures where we just follow what someone else is doing without understanding the true strategies, and the need for fundamental business strategies to be worked out. From my personal experience, we had many fundamentally weak companies that sprouted out in the last two years and many could not have lasted anyway, even if the dot.com bust did not come. The bust did come and many experienced failures. I hope that this failure will become the basis of a better chance of success in the future.”
“With a perpetual shortage of manpower, we have no choice but to be among the most productive in any activities that we carry out if we compare ourselves to any other countries in the world. Many of our incentive schemes also require investments to be made physically in Singapore. In doing so, we encourage companies to continue to add assets and resources in Singapore even though it may make sense to place such assets in more suitable countries. I therefore suggest that incentives to encourage outsourcing of activities to outside Singapore so that companies will restructure and focus on keeping only high value-added activities in Singapore. In a globalised knowledge economy, we should break up the whole value and supply chain of activities of manufacturing and service businesses and place the components of the value chain in countries best suited to carry out these activities productively and efficiently. Globalisation is also an urgent issue especially since regionalisation is not viable when the region is in turmoil. The Government should therefore take the opportunity to introduce new measures to give globalisation a boost, to encourage companies to move out of Singapore and beyond the region. It is about time we created more home-grown multinational companies which can compete effectively outside our shores and which can take advantage of the opportunities immediately available today as the whole market makes its transition to the new economy. On the whole, while we have done well with Government assistance and incentive schemes, I feel that we need to restructure the schemes to be more market-driven and move away from incentives that create a subsidy mentality.”
“The Government should hold off any more increases, in my opinion for now, and should a downturn come fast, the Government must be ready to react equally fast to address the cost competitiveness issues. The cost of doing business in Singapore will soon become a big issue again if we are not vigilant and let costs go back to the pre-Asian crisis levels. The Government should have a longer-term view of how the economy should be managed, especially when it involves the cost of doing business in Singapore. We got into trouble before and we can get into trouble again. I urge the Minister to convene a committee to start planning for a possible downturn and identify proactive measures. This will allow us to react decisively, should a downturn hit us again. The second thing on the manufacturing sector is that we all realise the importance of further strengthening the manufacturing sector as well as to establish a stronger base of SMEs which can transform into world-class companies. We have done an excellent job in attracting new investments in technology and manufacturing companies. The type of incentives, like the pioneer status, investment allowances, grants and subsidies, worked well in the past. Moving forward, I believe we need to devise new strategies and, therefore, new sets of incentives that will further strengthen the manufacturing sector as a key sector of our economy. Some of the things that we can do include giving incentives or tax breaks for companies which make productivity improvements. If a certain productivity standard can be developed and the Government can issue special tax incentives for companies that put in the resources to become more productive, this will be good for all of us.”
“I believe the indicators that the Government uses to measure the state of the economy are not sensitive enough to gauge the true situation of the economy, as the private sector has already reacted to the sudden slowdown while the Government indicators are not ringing any alarm bells. The other issue is that, in the past two years, economic recovery has been unequal, post Asian crisis. Certain sectors still lag behind and have not seen any recovery while a few did recover strongly, eg, the semi-conductors and the electronics industry. This time round, if a downturn comes quickly, we may risk wiping out some of these companies which will be hit by a double whammy because they would be hit again before they had a chance to recover from the last fall. More, therefore, should have been done in this budget, in anticipation of a deteriorating economy. We should be proactive and not reactive as we have been in the past. The second thing I would like to talk about is the cost of business and the future of the manufacturing sector in Singapore. While this year's budget was positive for businesses in two areas, first, the lowering of corporate taxes by 1% and, second, the lowering of property tax, I feel that the Minister could have taken the opportunity to review and implement changes which could further make Singapore an attractive hub and a centre for high value-added manufacturing activities. My concerns are in a few areas: Firstly, the cost increases. In the last one year or so, the cost of doing business in Singapore has increased. Costs have gone up in a number of areas, including Government rates, utilities, JTC rentals as well as CPF rates. The reversal of the cost-cutting measures occurred too fast at the first sign of economic recovery last year.”
“This, in my opinion, would lead to spiral effects of loss of confidence, where expectations of slowing sales and profits in companies would lead to worries about job cuts, which would lead to consumers slowing down spending, and which would further erode profits, which would in turn further weaken consumer confidence. Up to the end of last year, corporations were holding back making drastic structural changes to their companies, including people actions, and this was because the expectation was that there was a quick turnaround around the corner, and they wanted to be ready for a quick upturn when it comes and, therefore, they did not do the major restructuring. Given that the turnaround did not come, companies would now be seriously considering structural changes in their organisations and this scenario means a recession and tough times ahead for all of us. As to which of the two scenarios will prevail, I would say that we need a little more time to analyse and predict. We have to at least see how the first quarter goes. It is only after the dust has settled and the current confusion clears up due to the "over-pessimism" that we have seen starting December can we tell which direction the economy is heading. While I personally subscribe to the first scenario of a quick turnaround, we really need about three to four months to be a little surer. I therefore feel that the forecast of 5% to 7% is too optimistic, given the many changes that have happened, starting from the middle of December last year.”
“The first scenario is that the downturn is a short one and the US economy goes for a soft landing and confidence comes back, with consumers going back to purchase more. In my opinion, there has been too much of pessimism and, like always, consumers and companies have over-reacted due to the loss of confidence. This over-reaction is causing companies to drastically lower their forecasts of demand, to the point that they are now over conservative. These days, most companies do not keep very large volumes of inventories anyway, and they will see a depletion of inventory levels which have been built up in the last two quarters due to the sudden drop of demand, while production levels remained high at that time. With the depletion of inventories, we will see a quick turn-on of production when consumer demand returns. If and when this happens, we will see growth going back to sustainable levels and we can see a quick recovery. There is also the Asia demand factor, especially the demand for goods and services in China and Japan, especially if Japan reforms effectively. And this Asian demand may, to a certain extent, make up for the loss of US demand. Sir, the second scenario is not so nice. We may see a downturn lasting two to three years, and this will occur if the US goes into a recession and if they fail to get out of it fast and, especially, if the Japanese economy continues to drag. Consumer confidence would continue to be dragged down further and, if the stock markets remain depressed, people would become more conservative in spending. This will result in a continued decline of companies' performances.”
“Comments like "someone switched off the lights in December" or "things fell off the cliff in the second week of December" were quite common. In my opinion, this is happening because of the expectation, of course, of a weaker US economy this year and the loss of confidence in a sustained growth in the key sectors of our economy. While I heard that Dr Ker talked about growth in electronics and telecommunications, unfortunately, I think what we are seeing is that sectors like electronics, semi-conductors, mobile and wireless communications equipment - and some of these that were high growth areas - are actually starting to see declines right now. While we started hearing of negative announcements by companies in terms of drops in revenues and profits and lowering of forecasted growth rates since July last year, the general expectation at that time was that it was a period of correction and that these were mainly company-specific problems and not a general industry problem. Now, we have seen three quarters of such negative news, with companies that did very well last year also sounding cautious about the economic growth and outlook. This now translates to a belief that we will be seeing a sustained downturn resulting in not-so-soft a landing of the US economy. Coupled with the woes in Japan, confidence levels have dropped in many parts of the world, including Singapore. In my opinion, we will, without doubt, see a slowdown for now, and it may last for the next two to three quarters. What is not so obvious is whether we will see recovery after that. And there are two possible scenarios that I would like to share.”
“I personally call this a Knowledge Economy Transition budget for the following reasons: First of all, the tax concessions for start-ups and SMEs as well as for the self-employed and entrepreneurs; Secondly, the tax incentives for software and intellectual property operation and maintenance; Thirdly, a learning fund for everyone who wants to upgrade himself or herself; Fourthly, stock options tax reliefs for big and small companies; and Fifthly, higher rebates for everyone to soften the impact of a recession or a digital divide should we see problems during this transition. Today, I would like to address a few key issues, which I believe were not adequately covered by the budget proposals but are important enough to get some attention if we want to transform Singapore's economy to be a truly first-world economy. First of all, the state of the economy. In my speech during the Budget debate in 1999, I spoke about the accuracy of the indices the Ministry uses to measure and predict the state of the economy and, hence, how policies are set for the budget. As I recall, in 1998, many private sector industry leaders projected declines in certain sectors of the Singapore economy, while the ministry projected growth in the same sectors. A year later, the results showed that the private sector's reading of the state of the economy was right while the Government's projections were wrong. This shows obvious gaps between how the private sector reads the economy versus how the Government reads it. This time around, I am afraid, we may be seeing the same pattern. Here is my take on the state of the economy and how many others are seeing it: Since the middle of December last year, there was a sudden drop in demand, as if someone pulled the plug on the growing economy.”
“I think that we should also revisit our thinking although we have endowment funds for the aged, for medical care, that we should revisit ourselves to see how best we could help the old in Singapore. Before I conclude, I would just like to reply to one hon. Member, who, in talking about Government-linked companies, linked NTUC Fairprice in the list of Government-linked companies. As a trade unionist, I think NTUC Fairprice is definitely not a Government-linked company. It is owned by more than 200,000 individual trade union members who own very small shares - $20, $50 or $1,000 - and a number of trade unions. So it is not a Government-linked company. It is just a workers' cooperative that is well-run and well done. And, if workers can run enterprises well, they should be applauded and given incentives to do a better job, and not be described as a Government-linked company. Finally, I would just like to describe this Budget as generous. But if only CPF had been fully restored, then I would be much happier. I think workers would be much happier and we would have described this Budget as very generous. So we look forward to a very generous Budget in future. Mr Inderjit Singh (Ang Mo Kio): Sir, this year's Budget is indeed a generous one, with something for everyone. This time, the Minister has given special attention in developing the knowledge economy. It was indeed good to note that, for the first time in a very long time, something special has been done for the small and medium enterprises and start-ups. This will go a long way in helping us to grow local enterprises.”
“With many staff, at least more than 50% owning a stake in the company, they can only work to increase the shareholder value in the longer term, and this is definitely good. But we also need to look at other things. I ask the Minister why we need to reduce corporate tax by 1%. The argument about tax, whether Singapore would be declared a tax haven, was raised, and also whether the Government is locking itself in to a lower tax rate. In the past, there was the idea of giving rebates and, just in the case of personal income tax, could rebates have been a more useful tool? As trade unionists, as workers, we believe that it is very important to make companies profitable, and we actually took a lot of cuts in the past to ensure that companies remained profitable. But we also believe that when companies are making money, when they are highly profitable, they should not be unhappy to pay taxes. Paying taxes is actually paying a return to society for giving them the environment to make profits. And taxes are also useful because part of these could be used to help the less-advantaged people in our society. The other point of concern to the ground is the question of GST. They say that since personal income tax is reduced, corporate tax is reduced, can they have an assurance that GST would either stay the same or, if our surpluses are good enough, it can drop a little and it would be most welcome. Another point that I would like to raise is this: the Budget could do a little bit more for the old and sick. The pension revisions were far too little - $10 more. We could do more for pensioners and we could do more at more frequent intervals.”
“Mr Speaker, Sir, I am pleased with this Budget Statement. It has been described as a generous Budget. In the past, budgets used to be described as "painless", and when they were painless budgets, we were very happy. And, most of the time, the painless Budget was painless but, after the Budget, there would be off-budget measures where the pain comes in the form of other taxes. But, now, in this generous Budget, we can still hope to listen to the Prime Minister in his National Day Rally and hope for more generosity. If some people describe this as a pre-election Budget, I am very happy. And since the elections need not be held until August 2002, I hope we can have another pre-election budget and, then, it would be even more generous. As Singaporeans, we are, of course, always generous in helping people in need, and we also enjoy receiving generosity from the Government. Let me state why I am quite pleased with this Budget. Firstly, I think the contributions of the workers were recognised. The workers took a huge sacrifice during the recession, they took the pain and, now, when there are surpluses, I think it is right for these to be returned to them. Particularly, the tax exemptions for wage earners and small-time businessmen are most welcome. The service and conservancy charges, utility rates and rental rebates are good gestures to the HDB heartlanders for the difficulties they had to face during the last economic crisis. I think one of the brilliant pieces is the company stock options scheme, which rules that there must be a requirement of at least 50% of the staff. This requirement of at least 50% of the staff would ensure that there is a fair distribution of gains.”
“Could the Minister also enlighten us on the processes that the other bodies use for other countries other than China?”
“Is there some process to ensure that the fees that these agents charge are not excessive or exploitative?”
“Mr Speaker, Sir, if the polytechnics do not employ these agents and the polytechnics tell the parents to be careful, then why are the polytechnics recruiting students through these agents? What is the role of these agents?”
“Older workers who are facing job insecurity will need to continue to work as they live longer. These groups will have to embrace lifelong learning and I ask that special extra attention be paid to these groups of people. I am also a little concerned about clause 4(5) of this Bill. The clause says that any diminution in the value of the capital money has to be made good from the income of the Fund. This could happen if there are wrong investment decisions made or there is a general economic downturn. If there is a wrong investment, I do not think workers should suffer. In an economic downturn particularly, in fact workers would need more help and they would need more training. From this Fund itself, in an economic downturn, the returns will be less. With this reduced income, trying to make good the capital means that workers will be affected, and workers will suffer. I hope that the desire to maintain capital money will not be at the expense of workers. Therefore extra money will be found when it is actually needed. Finally, I ask the Government to give money from the Fund to individuals as in CPF, for use of training in new areas not provided by the employers and which may not be directly related to their present job or funded elsewhere. This idea is not new. It was raised by many Members in this House and by my colleagues in the unions. It is to start what you call a skills-save account similar to the Medisave account in CPF. This is basically for workers to learn continuously and to live more fulfilling lives. On this note, Mr Deputy Speaker, Sir, I support the Bill.”
“We should also have to learn from real experiences at work and life. It is beyond the occasional but useful spurt of training in classrooms or elsewhere. In that light, I support the fund being used in research and development of learning methods and in the technology of delivery mechanisms. The best approach to ensure that future demands for skills are met is for employers to invest in training as part of workplace learning. I hope this Bill will not shift responsibility for training totally to workers because workers will have access to this Fund. Employers will have to continue to invest in education, training and development of their employees. This Fund should be an additional support for workers complementing the various existing Government and employers' schemes in place now. These schemes include the Skills Redevelopment Programme, the Skills Development Fund, etc. The objects and applications of income of the Fund in clause 5 is crafted in language that is so broad that I think we need some reassurance on this point. For the individual, lifelong learning will need an element of self-direction and self-management. People of all ages and all backgrounds will have to embrace lifelong learning, otherwise we will all lose life skills. Some workers will need more support to successfully achieve this. The 2000 Population Census shows that older and less educated workers have greater risks of facing unemployment. I will add that the physically disabled also need special attention. These people need training most, but they also have many impediments to take up training. The lower income group find it difficult to find time to go for training. They earn little. Their incomes are now dropping due to new work organisation of outsourcing and contracting.”
“Mr Speaker, Sir, the European Commission made a report in November last year that within 10 years, 80% of the technology in use today will be outdated. This means that if nothing is done, only 20% of the workforce will have the skills and knowledge to keep a job. [Mr Deputy Speaker in the Chair] 4.22 pm If we do not train and upgrade workers, 80% of the present workforce will not have the skills and knowledge to master new technology. This will affect our ability to maintain full employment and meet our social objectives. There could be massive structural unemployment accompanied by major social problems. I am sure none of us want to see that happen. I support this Bill because it will contribute to enhancing the employability of workers, and I fully support full employment to be part of the economic and social agenda. Economic growth must also meet social objectives. The best social safety net any worker can expect is a decent good-paying job. This Bill is crafted in general terms and does not have details on how it works. As the Minister has explained, most of the details will be in the form of regulations. So I will just speak in general terms and hope that the Minister and the advisory council that will be formed will take up some of the comments. Sir, training and learning is a shared responsibility. The Government, the employer, the community and the individual all have a part to play. The establishment of this Endowment Fund should not result in the reduction of the shared responsibility. The aim of lifelong learning and training should be to contribute to the continued well-being of everyone in our society. We should see lifelong learning as a continuous process that takes place throughout one's working life.”
“Power Supply is required under the Electricity Supply Code to bill its customers promptly every month. Since July last year, PUB had been receiving complaints from customers about the delay in billing. PUB took this up with Power Supply immediately and directed them to take swift action to correct its billing system. For breaching the Electricity Supply Code, PUB had imposed a total fine of $150,000 on Power Supply - comprising $100,000 in October for the delay in billing and a further $50,000 in December for failure to resolve its billing problems. This is to send a strong signal to Power Supply that we take the matter very seriously although it provides no comfort to customers. To lessen the impact on customers, Power Supply has arranged to space out bills sent to customers by at least 18 days. The payment schedule for these bills was similarly extended. Customers would not be required to pay a lump sum for the delayed bills, if they do not wish to do so. They can pay by instalments. Power Supply has also given the assurance that utilities supply will not be disconnected due to unpaid bills during this period. Power Supply has indicated that they have overcome the teething problems of their new billing system and more bills are now being dispatched. They expect significant improvements by March this year and the billing process should be normalised by the middle of this year. So it is taking a very long time.”
“Most businesses will be affected by the slower economic growth, but SMEs should be more vulnerable. SMEs will have to find ways to improve productivity, develop better products and explore new markets - not just SMEs, but all companies. And the Government has many programmes to help SMEs to do so. POWER SUPPLY LTD (Revamp of billing system) 16. Dr Wang Kai Yuen asked the Minister for Trade and Industry whether Singapore Power Ltd (SP) (i) has completed its revamp of its billing system and how many percent of its customers are now being billed correctly on time; (ii) is in compliance with the service standards established by the Public Utilities Board with regard to billing customers on time; and (iii) has an assistance scheme to help those customers who do not have the means to pay the lump sum payment as a result of SP's failure to bill over the preceding months. BG George Yong-Boon Yeo: Mr Speaker, Sir, Power Supply Ltd had implemented a new Customer Management System to replace its old billing system. However, during the transition period in June last year, Power Supply encountered data migration problems, which affected the system operation. This resulted in a delay in the generation of utilities bills as well as inaccuracies in billing amounts. As at December last year, Power Supply had not completed the revamp of its computerised billing system. They tried to make improvements and the improvements by the system implementor created even more bugs. So they had brought in a team from the original software supplier which is SAP of Germany, a very reputable firm, and they are working hard to resolve the problem. Today, 88% of customers are receiving their monthly bills on time. But this is obviously far from being good enough.”
“Question No. 15, Sir. BG George Yong-Boon Yeo: Mr Speaker, Sir, the overall economy grew by a strong 10.1% in 2000. All sectors enjoyed robust growth except construction, which continued to contract. However, the performance was highly mixed within each sector, with some segments doing very well and others not as well. For example, although the manufacturing sector expanded by 15% in the first 11 months last year overall, this was due largely to the 27% growth in the electronics industry. The food and beverage, wood and paper products, construction-related materials, basic metals, petroleum and marine industries grew by less than 4%. These industries accounted for about one-fifth of manufacturing firms and jobs. Similarly, in the retail sector, although overall retail sales grew by a strong 25% (in volume terms) in the first 10 months of last year, much of the growth came from the sale of motor vehicles, telecommunications equipment and computers. Supermarkets, provision and sundry shops, and watch and jewellery retailers experienced poorer business. Because the growth was uneven, those in the slow-growing segments did not feel the effect of the recovery. Many of them are SMEs. In fact, many of them asked me, where was this 10.1% growth which was put out. The reason is that growth has been uneven and depending on where you are, you may, in fact, feel it even more strongly or less strongly. As to the slowdown of the US economy, this would moderate our GDP growth. Most analysts currently expect the US to grow by 2.5-3% this year, down from about 5% in the year 2000. MTI projects that Singapore's GDP growth will slow down accordingly to 5-7% this year. But if there is a crash landing in the US, then the forecast will change.”
“But even for these non-wage earners, the contingent workforce is going up. The number is going up. We are also encouraging people to be entrepreneurs and self-employed, and these people are not covered. At present, there is provision for some of these self-employed who have applied for licences to contribute to Medisave. Can provision be made for more people to be covered by the CPF and at least be part of the social safety net that is in place? I also observe that there will be amendments to section 39 which talks about different classes of members. I would like to ask what is being meant by "different classes"? Will there be different types of schemes for different types of employees? Finally, just a suggestion for the Government to take up, that is, to enable people to have more money in CPF. At the present moment and also in support of pro-family policies, a lot of people use CPF to buy their homes. However, our national servicemen do not contribute to CPF. So maybe, at this time, we can also make provision to increase the national servicemen's allowance from the present $240 to market rate, ie, whatever an 18 or 19-year old boy would have earned outside, and put the additional amount into CPF. When they complete their national service, they have some money in their CPF account to pay the deposit for a home and start a new family very soon. On that note, I would like to support the Bill.”
“At the same time, I also want to express a bit of concern which workers have. How far would the Minister use his powers in granting exclusions and exemptions? We know that whenever there is financial difficulty, employers will scrimp on cost and there is also some concern on whether this provision will be used to increase the amount of exemptions, resulting in lower CPF contributions in the long run. I hope that this provision will, in the long run, be used very discreetly and sparingly, with the workers' interest at heart. On the question of increasing the Minimum Sum from $40,000 to $65,000, it is positive and meets the recommendations of the Inter-Ministerial Committee on Ageing Population. But the question is how many of our CPF holders will be able to meet this Minimum Sum. The other question is: can retirees live adequately on this sum? We know that CPF will not fully replace earnings, so the Ministry and the CPF Board should also come out with more education, in addition to what they are doing now, to tell people how much they need to have in order to maintain the same lifestyle comfortably. If CPF is extremely important, then the question is: CPF has been cut at least two times during the recession period, and now that the economy is doing well, when is the rate going to be restored? Can it be restored quickly enough? Cutting CPF is painful and workers suffer. The same people who need the protection of CPF have suffered most. Parallel to enhancing the safety net for CPF, the Ministry must also tell us what is the progress in developing the flexible wage system and how much of push is there so that the workers' interest is fully protected. I also want to say that CPF only covers wage earners. It does not cover those who are not wage earners.”
“Sir, I want to say that this amendment to the CPF Act is very positive and is in harmony with the recommendations of the Inter-Ministerial Committee on Ageing Population. The Committee had expressed some concerns that CPF holders may not have adequate balance to see them through retirement and some of these measures seem to meet those concerns. I am particularly happy about some of the amendments and one of it is that it is actually very pro-family, in the sense that the definition of a related person in the Act has been amended from just spouse to include grandparents, grandchildren and siblings. This a positive move. And there are also incentives for grandchildren to contribute to the grandparents' retirement account. This is also a good move as it strengthens the family. I also support the increase of the Minimum Sum from $40,000 to $65,000, as well as the improvements in the Home Protection Insurance Scheme and the Dependants' Protection Insurance Scheme. And very important for us are the enhanced powers to recover arrears from defaulters. Mr Charles Chong had spoken on it and I fully endorse what he said. In expressing my satisfaction, I also have to express some concerns and suggestions that I have. Section 2 of the Act, which is going to be amended, is to give the Minister powers to exclude certain payments from the definition of "wages". The Minister has clarified that he meant payments like long service awards. Excluding long service awards is a good thing and I support it. I also want to say that payments which are exempted from CPF should also not be taxable. I hope that the Minister for Finance would take the cue and not tax on long service awards and one-off incentive payments which employers give.”
“I therefore urge the Minister to consider these aspects and make amendments to better protect the interests of workers.”
“Mr Speaker, Sir, I support the amendments to protect the interests of investors. I agree with the need for greater disclosure and better governance. However, I am a bit disappointed there was not the same level of zeal to protect the interests of employees. The review the Minister spoke about has apparently not covered this aspect. Employees are important. They make or break the enterprise. And if the enterprise fails, shareholders will only lose the money they invested in the enterprise. Employees, on the other hand, stand to lose their livelihood if the enterprise fails. Through salaries, employees maintain their families, their standard of living, send their children to school, service their homes, housing loans and a whole lot of things. The price of losing one's livelihood compared to losing money in an investment is very much more painful. Section 328 of the Act gives greater retrenchment benefits, workman's compensation, CPF contributions, leave pay, preference in the event of a liqudiation. This is right and it is good. However, the maximum of five months' salary or $7,500, whichever is lower, was fixed in an amendment in 1993. It was seven years ago. The average wage in 1993 was $1,918. In 1999, the average monthly wage has risen to $2,813. This reflects an increase of nearly $900 or 47%. I submit that it is actually time to adjust this figure. Another aspect I would like to see is an amendment regarding judicial management. It is silent over monies owed to workers. Under judicial management, workers are not preferential creditors. Workers tend to lose if judicial management fails. This appears to be a contradiction with section 328 of the Act.”
“I would just like to ask the Minister: is there a problem with domestic maids not complying with the terms of their work permit and therefore we have to send them off? What I am saying is that since the problem with employers is so small, what about the problems of the domestic maids themselves? Are there any significant problems?”
“Therefore, we also need to relook at our social safety nets as well as realise that because there is a lot of casualisation of labour at the bottom end, people feel very insecure. We should increase protection for this group of workers, because they do not have the bargaining power or the skills to earn top wages and they need help. And on help, I accept that the best form of social security for anybody is social security with dignity, and that is to have jobs and have the pride of being self-reliant. Sir, I think it is important that we help our people to be self-reliant and have the ability to move up. Therefore, the key for the majority of us would be opportunities and that the role of Government beyond economic growth is also social growth, social cohesion, and cost of living. And if we do all that, then I think we will have people in our society who are strong. They get stronger, and we know that we cannot strengthen the weak by weakening the strong. The strong gets stronger but it is without weakening the weak. If we have the right values, then I accept that we should not have the politics of envy but rather the politics of saying that "if this is something that everybody can achieve, I too have the opportunity to get it. My children can also have the opportunity to have it" and therefore everybody wins. Sir, on that note, I have no difficulty in accepting that anybody, whether it is Ministers, civil servants, the private sector and ordinary workers, who deserves should get his fair worth. 5.15 pm”
“When it is very secure, when things are very smooth, when we do not have these problems, many of us will not think about it. But in moving forward from these events, the difficulties of the ordinary workers who do find a lot of pressures of cost of living, some of them find it very difficult to understand why some people should earn so much more than they could spend. But, at the same time, if these people do explain and we understand that it is for the overall good, it helps. The other thing we learn is that everybody should have opportunities to move up, and the best way is through education. In the US and in many other places, the answer was education, and there must be social mobility. Because when you move up the ladder of success, sometimes the ladder is slippery, you slip. But when you fall there must be sufficient safety nets. And along the way in working life, the chance to move and upgrade is very important in our society. Can we have that? As regards social safety nets, I would suggest that we also relook at our social safety nets. We have got basic safety nets of health, education, housing. These are important. But what is poverty, what is poor, also changes the relative values. I remember when I was young, a lot of homes did not have a refrigerator. The telephone was not in every home. Television was not in every home. But, today, these are considered very basic. The UN says that the poverty line is US$1 a day. But in our society, because our norms are different, the poverty line is also different, and it is also relative. If somebody has it, we also want to keep up with the Joneses.”
“He did not just preach and talk about the world to come, but he also converted many of his ideals into practical help, in the sense that he built schools; he housed people who were in difficulty; he helped the poor; he gave practical assistance, built orphanages and he helped. At the end of the day, the ordinary working people in England were motivated to work hard, to save more, to earn more and also from their earnings, to give back more, and the social standard of living changed. And that was a bit of a social revolution. Another thing that comes to mind is that at the beginning of the 20th century and at the end of the 19th century, 1% of the US population owned 45% of the national wealth. They had all the ingredients for a great revolution or uprising, but it did not take place. Europe had lesser differentials but they had revolutions - the Russian revolution and the Great War. Why did it not happen in the US but happened in Europe? I sit back and I think that one of the reasons is that in the United States, everybody had opportunities through education. Europe was very class divided. And one of the lessons that I learned and one of the key things is that we also need social consciousness. We cannot have a good society whereby people who are eligible and who are entitled to get their worth is paid less than their worth. I think people must get their worth. But the people who get the high pay, who earn well, must also realise that they have to give back something to society. And there are also people who have lesser abilities, lesser talent than them, and they have to be supported. It is not just the creation of wealth but it is also having the right social conditions and stability. I think we must be aware of this.”
“The third thing is that, even at Question Time the discussion and the debate were that it seems to be that the demand for the skills of a few people at the top are going up. Therefore, their earnings are spiralling upwards, and they are going up and up. There are people at the lower level whose jobs are getting casualised, jobs are being outsourced and there is a spiral downwards, and the net result is that the gap is getting bigger and bigger. We heard that in economic terms, this widening gap is inevitable. But is this socially and morally acceptable? Will it result in a change of values? Are we only measuring efficiency in terms of dollars, and in terms of money? I reflect on this and I think one of the answers to some of these questions can be found in history. I would like to ask whether history can teach us some things, and a few things strike me. One is, in France, during the time of Louis XVI, they had great income disparity. When the Queen was told that the ordinary people did not have bread, she said, "Give them cake!" The net result was the French Revolution. England, at the same time, was also in a similar situation, but they did not have a revolution. There were a lot of poor people. Income gaps were very wide and leaders were out of touch. I read somewhere that one of the reasons why there was no revolution in England was attributed to just one man who went from town to town, village to village, on horseback. His name was John Wesley. He basically gave a lot of ordinary people hope - hope beyond their difficult circumstances.”
“Mr Speaker, Sir, the wage increase which was announced today is a good thing, in the sense that it is in line with the National Wages Council's recommendation which actually gives recognition to the sacrifices of workers during the recession. The other thing is that it keeps faith - there is reward for sacrifices. At the same time, I also accept the economic reality that you have to pay high salaries to attract and retain - and the word used - talent. But instead of using the word "talent", I would prefer "people with the appropriate skills and abilities" that can meet the needs for the work they do. To pay people their worth is definitely acceptable. But in trying to solve one set of problems, we must also be aware that sometimes we create other problems, and there are also concerns. We also have to be aware of what the concerns and problems are, and try to resolve them. In my own mind, sitting there and listening, I can think of three basic concerns which many people have. The first one is: who pays for the increases? There are going to be increases and it has to be paid. The normal thing to ask is: will it result in increases in fees and in Government charges? And a lot of costs of living are going up. Will it be more expensive for ordinary citizens of this country? The other thing is: how do we measure talent? Who are the talents - the right people with the right skills? We bring in people with ability. We talk about market. We talk about efficiency. And they are very high in IQ. They write good papers and have good ideas. But there is also another important element, which is the feel for the people. The emotional quotient of our top civil servants is also important.”
“We help to build that community centre or that church or that mosque, and that creates a sense of ownership and of rootedness in Singapore. National service requires all Singaporeans, whether those who are at the top or at the bottom, to feel collectively that when it comes to a crisis, we must all work together for the common survival of the state. But this is not a question which can be easily answered by the Government. The Government can do its part. All of us have to do our part as parents, as teachers, as community leaders, that while we adjust to market developments, we do not forget that in the end what holds the community together is not just money, but a sense of solidarity and a sense of common destiny. That we must always have in Singapore. We can have foreigners to help us, we can have foreign talents coming in to supplement various positions, but at the core, we must have a group of people who feel completely Singaporean.”
“I am just asking whether the Government will promote a living wage as well. BG George Yong-Boon Yeo: Sir, Mr Thomas has touched on a problem which is very fundamental and which concerns the Government a great deal. When I was in Davos at the WEF Meeting in January this year, they had one session called "The Age of Disloyalty", that with globalisation and with international talents becoming mobile, are we all linked only by money and nothing else? Is there such a thing called "patriotism" or "loyalty" left to corporations, tribes or charities? Because we are a cosmopolitan city and our young are all educated in English, they are internationally mobile. While we tell ourselves that we should be in the game, bring foreign talents to Singapore, we are also in danger of losing our own talents to other countries and even when they are in Singapore, are they loyal to Singapore? This is the question which concerns us a lot because, in a crisis, whether or not we have this sense of solidarity makes a difference between success and failure, between life and death, between victory and defeat. So national service will remain important. Our willingness to look after those who are weak, subnormal or crippled in our midst is very important. This is one reason why the Government has been very careful to avoid subsidising charities or self-help organisations completely without requiring these organisations to also raise their own money. The widow's mite is very important. Without that fund raising effort, there will be no ownership of schools, hospitals or community organisations. Many of us complain that we are constantly being roped in for fund raising, but all the effort in fund raising is actually a process of social bonding.”
“Sir, can I ask the Minister what steps are being taken to promote social consciousness among the talents and top earners that they have a responsibility towards the massive majority who may not have the talents or the abilities they possess but they were able to exercise those talents and abilities to earn top salaries and incomes, because the majority provides the social opportunities, and part of that social consciousness is to give back to society? And also for employers, when they offer jobs to people, they should take into account not just the market factors of the lowest possible and not to benchmark them with foreign workers but also take the human perspective and offer them jobs which they can have a living wage. Many people may have turned down jobs because their salaries are so low and they do not just cover ---”
“Finally, I also want to say that as long as we keep the other pieces of legislation on elections and allow free media access for people to express their ideas, there will be less danger of us having to worry about the need to implement this Bill. In that sense, I support the Bill.”
“Because I do not think anybody with $5,000 would go and ask 500 people to donate $100 each. It is too troublesome and it would not do. The other point is only the big donors will be the ones who can exert undue influence. Therefore, to keep political societies and political parties independent, it is better to have small donors but widespread and mass organisations, because after all winning election is by getting mass support. And if they do not have ideas that can induce or encourage the ordinary men to contribute, then the idea dies. The next point is about corporate donations. Corporations cannot vote in an election. It is individuals. The country is made of individuals. And I do not support the idea of companies making contributions or donations to political parties. If you want to have rules, let us completely prevent companies or corporate bodies from donating. In the UK law, they ask for a general meeting of members to decide to give or not to give. But in UK, the trade unions also have funds to contribute to political parties. Societies do. But in Singapore, our trade unions do not. Our Trade Unions Act prevents that and there are good reasons for that. Many of our societies do not do that. Cooperative societies do not do that, and we have good reasons for that. And we should also not allow individuals to support political parties or political issues with corporate big business money. We should not come to a state like in the United States where big businesses have undue influence in our political process. Therefore, if anybody wants to donate, let them donate as individuals and let them be identified. Let us be transparent about it rather than through the veil of a corporation.”
“One of the clarifications is we need to define a little bit more on the political associations other than political parties. And one of the best ways is for the Minister to give examples, and even if he has the examples and he has to gazette, it is good to give ample notice to a concerned organisation. And I would support that more than a political party should be defined as "political association" because many could be third parties who can influence outcomes. The US presidential election is a clear cut example where a lot of third-party people under great or strange names are influencing the outcome. I do not think we should have that in Singapore but we should at the same time be very clear who we are referring to and how we want to do it. The other provision is in clause 3(2)(e) about sponsorship. It is quite widely defined and we do not know what exactly it means. If somebody invites you for a dinner and is a political association, and you pay for the dinner, would it be considered sponsorship? Or if they have a publication and people advertise, would it also be sponsorship? What about cost of seminars and conferences? Would it be all right to sponsor research programmes, or somebody's political organisation, because the research programmes could have impact on the positions to take? Therefore, this clause needs a bit more clarification. I have a few suggestions. First, the limit on anonymous donations. I have looked at the British Bill. In UK, they say up to pound 50, it is anonymous. You only declare if it is more than pound 50. It seems we have modelled quite a lot on the British Bill. We can take a similar approach and say that if it is less than S$100, it can be considered anonymous.”
“Mr Speaker, Sir, as all good Singaporeans, we want the destiny of this country to be decided by our own citizens and by Singaporeans, and in wanting to exclude or have rules to prevent foreigners from trying to control and unduly influence the outcome of our society wins my support. At the same time, while we try to have controls to prevent foreigners coming in, we must still encourage the participation of our citizens in our political life and civil society. Democracy and democratic institutions can be strengthened if more of our citizens participate and take an interest in politics and civil society matters. Therefore, the challenge here is to get the right balance between controls and free involvement. We should not have too much controls in that the free involvement becomes constrained. I think the art is getting the right balance. But before we even talk about balance, when we talk about the need for funds, the biggest need for funds is actually to participate. Therefore, if you make it cheap and not too expensive for people to participate in politics and stand for elections, then the need to raise funds and be dependent on too many sources of funds become unnecessary. Therefore, having the elections where you have limits on expenditure, ie, $2.50 per voter, does not make it really necessary to raise funds. And we should still work at great expense to keep expenses of conducting elections and being involved in public life affordable, and barriers for entry as low as possible, so that any Singaporean who aspires to get into politics through a party, or as an independent candidate, can freely do so. But having said that, we also need a few clarifications.”
“We find a lot of evidence and stories around that the employers do depress their wages, especially for the unskilled levels. We would also like to get some assurance from MOM on what is taking place to ensure that the interests of the older workers are also there and wages are not depressed too low with cheap foreign workers.”