Yee Jenn Jong
Singapore
“So, can the Minister of State confirm whether the gates are considered as doors and whether they meet the BCA Code? Finally, the residents that I have communicated with in this DBSS, have complained that when they took up the design issues with the developers, they were told, and I quote, "Everything approved by HDB".”
“I thank the Minister of State for the reply. In view of the frequent occurrences of algal blooms in the past and it has become almost an annual affair, are there studies to also see if it is perhaps due to the reclamation works or other projects affecting the environment either by Singapore or by our immediate neighbours?”
“Thank you, Madam. I thank the Senior Minister of State for the answer. First of all, condolences to those who have lost their loved ones at the recent Lufthansa Germanwings incident. I would like to confirm if this multi-layered cockpit security applies to all Singapore-based airlines, including the budget airlines?”
“I thank the Minister for the reply. Just a supplementary question. I would like to check if our Government agencies have conducted studies on how Singapore's hedging product market compares to those in other countries and also, especially on the usage by our companies.”
“Thank you, Madam. I agree with the Minister that the pre-school sector is fragmented and I support the idea of consolidation. My question is, can an application for POP be from a group of operators banding together, rather than from a single operator? This may speed up the process of consolidation.”
“Is there a way for the landowner to be given an indicative value of the land before the request is made for the Government to acquire it? Is there any cost the landowner needs to pay if such a request for indicative value is allowed? And what will happen if the eventual price differs significantly from the indicative value?”
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“Sir, we have seen a huge rise in the demand for childcare. Of late, the Government has put a lot of resources in that area. However, I do not see the same being done for student care. The same young working parents that use childcare services will need student care for their children, at least for the first few years of school. Commercial SCCs are unattractive to run, given the high cost of rent and lack of Government support, compared to childcare. The MSF website listed 207 student care centres, of which a good number are tuition or childcare centres. These may take only a small number for student care, if at all, as their other operations are generally more profitable. Good student care services could eliminate the need for tuition. Is the current supply of student care places sufficient for our increasing needs for this area? Student care operators are also not subjected to the Ministry's supervision for quality, unlike childcare. SCCs are not required to be licensed and are not subjected to regular checks by MSF. Their staff need not attain minimum qualifications and training. I urge the Government to extend better funding and resource support to this sector, create more places, work with MOE to have more SCCs in all schools, and to provide closer supervision of the quality of operations. Page: 166”
“Sir, I refer the Minister to the KiFAS portion of my Budget debate speech. I am puzzled that after review, KiFAS can only be used on kindergartens operated by MOE and anchor operators. Those that qualify for KiFAS form less than half of the some 500 kindergartens here. More than 95% of qualifying kindergartens belong to Page: 161 just PCF. Other than PCF and MOE centres, are there actually any other centres that are KiFAS-approved today? There are many good kindergartens, some with long history, like the ones my siblings and I attended some 40-50 years ago. KiFAS should apply to all registered kindergartens, just like its sister scheme, CFAC. CFAC can be used on all childcare centres. MOE also saw it fit to support aided schools with religious affiliations. This Government has prided our recent Budgets for being inclusive. I believe we can be more inclusive to allow more, if not all, kindergartens to be KiFAS-supported. Babysitting Subsidy”
“We can start with new towns by having more dedicated bicycle lanes on roads and to have a more aggressive national campaign to cultivate respect for the roads between cyclists and motorists. Singapore as a Cycling City”
“Madam, two months ago, I did a day-long cycling trip through San Francisco on a working weekday, from the bustling financial and shopping areas to the Golden Gate Bridge and back. It was a refreshing experience. Even in the busy downtown, there were bicycle lanes marked out for cyclists. Where there were no dedicated bicycle lanes, a slow lane was marked out as a shared lane between motorists and cyclists. Motorists that were on the shared lane followed behind us. In some suburbs without any marked lanes, motorists waited patiently for us to cross the road junctions. They kept a safe distance when overtaking us. Bicycles were allowed onto segments of the trains and subways. There were automated bicycle kiosks in many parts of the city where one could book out a bike and return it at another kiosk. It is no wonder that many in San Francisco commute to work by cycling. There are other bicycle-friendly cities. For example, in Copenhagen, cycling is already the most popular mode of transport and the city has set even more ambitious cycling KPIs, such as for bicycling to capture 50% of all modes of transport to school or work. The city has dedicated lanes and special short-cut paths for cyclists. It takes a whole-of-city approach to encourage cycling by reducing travelling time on popular routes and to make roads safer and more comfortable for cyclists. I acknowledge that the Government has implemented cycling paths and plans to have more. Having experienced San Francisco, I hope our Government can set even more ambitious targets to make cycling safer and more comfortable here so that even more could make it as a preferred mode of transport.”
“Sir, the haze is at our doorstep again. Singapore has been affected by recurring haze episodes resulting from land and forest fires in Indonesia since 1991, with last year's being the worst ever. These had an adverse impact on our tourism, economy and the health of our people. I had previously, in this House, called for legislation to empower our authorities to punish those found guilty of transboundary haze pollution in Singapore through their deliberate actions, even when committed outside of our shores. I am glad to see that the Ministry is contemplating a Bill to this effect that can impose criminal and civil liabilities on guilty entities. While some may argue that it is hard to impose our rights outside of Singapore, we should bear in mind that many of the large plantations have operations in Singapore or are public-listed here. We want to do business only with companies that are responsible. Many Singaporeans desire to know if the products they buy have been produced through illegal land clearance. While the fines may not seem large, Page: 160 the proposed legislation will now empower our Government to have the means to take legal actions in our own courts against offenders. Such actions will signal to our consumers whose products they should or should not support. It will also signal to the region of our determination to solve this perennial problem and can hopefully spur other countries to enforce actions on offenders as well. Singapore's Environmental Challenges”
“I have two questions. The Minister has announced 40 new Student Care Centres (SSCs). While more students will benefit, more than one third of schools will still not have SSCs by 2016. I would like to know what constraints MOE face in moving faster. Is it funding, lack of operators or lack of physical infrastructure? And just a little more about the tuition grant – MOE has said in two previous Parliament replies that (a) no one has deferred more than six years and (b) deferment duration is on a case-by-case basis. Those who go for Masters and PhD will need longer deferment. I would like to know – it is common for postgraduate programmes leading to PhD to take more than six years – so, why is it that no one has ever deferred more than six years? I would also like to know whether MOE has to write off amounts if a student becomes uncontactable and it becomes difficult to enforce liquidated damages from abroad. If so, how many cases have there been? Also, with our highly ranked universities, are they able to attract international students with lower tuition grant quantum and with fewer scholarships?”
“In my view, this range is too wide, and a figure of 10% of a cohort admitted under DAS is too high. With a conservative ballpark figure of 12,000 University places per admission cohort in our AUs in the last five years, it means that there was, at least in one year, where 1,200 undergraduates were admitted under the DAS. Just as I support the Direct School Admission in our national schools, there is a place for the DAS in our AUs. DAS students, with their special strengths and talents, can meaningfully add to the educational experience of their peers and enrich university life. But, in my view, undergraduates admitted under DAS should not exceed 3% to 5% of each admission cohort. As I understand it, many DAS cases are students who qualified for local University admission but who would not have Page: 167 been admitted based on their academic results alone. Admission to our Universities is very competitive. Every place for a DAS student means a place denied to a student who would otherwise have been admitted based on academic merit. I urge the Ministry to exert greater oversight of the DAS in our Autonomous Universities. Transforming Education through the Arts”
“Sir, last year, NUS announced a three-month online plus three-month campus learning programme for incoming undergraduates who have completed National Service. The programme qualifies for academic credits. Last month, NTU went one up. Its online courses allow anyone to earn credits and transfer these to NTU if they enrol as an undergraduate later. Page: 166 MINDEF has initiated a Committee to Strengthen National Service (CSNS). Amongst other things, it is looking at how skills picked up during NS could be recognised in civilian life. An example is the Swiss allowing the transfer of skills or leadership positions in the military into credits in universities. Online learning is now widely used everywhere. We can marry the ideas started by the universities and what MINDEF is looking at, by having more programmes to engage NSFs in continuous learning. A Straits Times article last year highlighted that more NSFs are studying part-time, but with private providers. NSFs will have varying degrees of free time. Online can let them pace themselves and learn even whilst in camp. Our schools can look at courses that can expand on what NSFs are learning in their vocations. MINDEF has gone high-tech. Universities can offer courses, such as computing, telecommunications and engineering, that explore the technology behind the weapons and tools that NSFs use. Management schools can engage them in leadership and soft skills. Discretionary Admission to Autonomous Universities (AUs) Assoc Prof Tan Kheng Boon Eugene: Sir, in a written reply to a Parliamentary Question I filed last month, the Education Ministry stated that in the past five years, students admitted under the Autonomous Universities' Discretionary Admission Scheme (DAS) accounted for between 1% and 10% of each intake.”
“Perversely enough, to increase the odds of publishing well in the field of social sciences and the humanities on Singapore topics, one probably has to be unfairly critical, almost polemical, in analysing and admonishing of Singapore. There are academics overseas who have created a lucrative academic industry of caricaturizing Singapore. Put bluntly, bashing Singapore pays. In MOE's 2012 Committee of Supply, I argued that it is important to develop Singaporean talent in the various disciplines, particularly in areas that are important or perhaps even of strategic interest to Singapore. In these areas, it is crucial to have Singaporean talent and expertise grounded in a firm commitment to Singapore and with a subtle and nuanced understanding of the Singapore context. Then Chief Justice Chan in the same speech urged law academics to "strike a proper balance between personal and national interests". Can there be more recognition given to our academics who work on Singapore? We urgently need to go beyond lip service. MOE should take the lead if the Autonomous Universities are not willing to do so. Environment Education at All Levels”
“By building deeper engagement, it will raise the bar for internship across the country and foster closer links between the industry and research done in tertiary institutions. Promoting Scholarship on Singapore Assoc Prof Tan Kheng Boon Eugene: Sir, I declare my interest as an academic at the Singapore Management University. In our worthy quest to have world-class universities, the irony is that one casualty is scholarship on Singapore. The incentives for performance bonuses, tenure and promotion mean that academics are often driven to be "strategic" in their research, publications and teaching. Page: 164 Put simply, top-tier, peer-reviewed academic journals in the social sciences and humanities, in particular, are not typically enamoured with top-rate scholarship on Singapore compared with other topics. Why is this so? It is a function of our small size and our unique political development. Scholarship on Singapore is deemed to be of very limited applicability in academia. The harsh reality is that Singapore studies are not regarded as being relevant or appealing enough to most journals' readership. One such area is the study of Singapore government and politics. Another area is Singapore law. The then Chief Justice Chan Sek Keong in a 2007 speech described the situation I just outlined as a "tension between the need to write on Singapore law for local consumption and the need to write for international recognition". Singapore's history and development and our unique set of political, social, economic, cultural policies, and institutions are seen as exceptions or even oddities to the Western audience.”
“Sir, I have taken interns in my companies for the last 13 years, from Secondary to tertiary students. I made it a point to expose them Page: 163 to real-life work, as relevant as possible to their training, skills and interests. Internship is an important part of tertiary training, as the Minister has just said. This will be even more so when we run practice-based Universities. Even research universities need to develop meaningful internships to allow their students to keep abreast of industry needs. Countries like Germany have strong internship programmes. Often, graduates continue to work for the companies they interned in. Research know-how from German universities has also strengthened the technical capabilities of companies, through internship and apprenticeship links. Sir, there may develop a gap between the number of interns and the availability of meaningful internship places as we increase our University intake. From my experience, I also found differing intensity of engagement by education institutions and their supervisors with companies like mine. Internship can be an effort beyond the institutions. It can be at the country level. We can identify technical skills needed in priority sectors and help inject these capabilities into local companies to make them global players. The Government can work with larger companies to identify those prepared to commit a minimum number of internship places with real-world projects and support companies by funding an internship manager. This manager can mentor interns and even guide them while they work part-time from their schools on projects initiated during internship. This will allow companies to assign longer and realistic internship projects and tap on academic supervisors to guide students in research.”
“Madam, there are now 80 school-based Student Care Centres (SSCs). While this is an increase since 2011, SSCs are available in just over 40% of Primary schools here. The number of student care places outside of SSCs will continue to fall as operators find it commercially unattractive to run these due to high rental cost. Operators prefer to offer childcare services which are better funded by the Government or run tuition centres. The demand for student care services has increased, just as it did for childcare services. The best place to run such centres is in the schools, where students need not move out of the school and the Page: 139 operators can best coordinate with the teachers to follow up on homework and learning. Schools' facilities in single-session schools are not fully ultilised after school hours. If facilities are offered at token rents to operators, MOE can negotiate for lower fees and higher quality programmes. It will also reduce the need for tuition, benefiting students from disadvantaged families. MOE did not provide figures for my PQ on the waitlist in SSCs. So, I did a random check on 12 SSCs, both in new and in mature estates. I found that all have no vacancies, with one having over 50 children on the waitlist! The demand is very strong. I would like to see MOE aim for 100% of all Primary schools to have SSCs as soon as possible. Existing operators that run community-based centres will likely be interested to move their operations into schools to avoid high rents and can pass the savings on to parents. I hope MOE and MSF can make this into an urgent priority. 5.30 pm Special Needs Students in Schools and IHLs”
“Madam, I have spoken about piloting Primary through Secondary integrated schools every year since I have entered this House. I am glad that other hon Members like Mr Laurence Lien and Ms Denise Phua have also been making similar calls. 5.00 pm Page: 127 Singaporean children must study in public schools unless they are granted permission by MOE to be schooled at home or in international schools. They have to go through the PSLE which is, in effect, a sorting test to determine academic streams and Secondary school admission. Even with the ongoing review, the PSLE will still be used to sort students. The stress of an early high-stakes test will still be there. Madam, I understand that some parents will want a competitive system and for their children to enter into what they believe as the best schools. There are, however, parents like myself who would rather have our children go through Primary and Secondary education in the same school without PSLE. The brands of schools have not mattered to me. Such an integrated system is available in many countries, including those that have fared well in international education benchmarks. The choice is not available here. I urge MOE to study the feasibility to pilot such integrated schools. We can leave out the top schools in the pilot so that this will not become a back door. We have years of holistic assessment experience and capable educators. We can use these strengths to make such schools as good schools, too. Citizenship and Civic Consciousness”
“I would like to thank the Senior Minister of State for the answers. She has said that the Government is reviewing the R&D note for PIC for better advice. I am glad to note that. I just want to share that a lot has been talked about Block 71 at Ayer Rajah. In fact, that is where I went to ask them about their claim experience for R&D on PIC. So far, it has all been negative. These are companies that are trying to develop some world-changing app or stuff like that. Is it intended to be so that the IT companies will find it rather difficult to claim for R&D, and are the ground staff in IRAS able to assess their claims?”
“Sir, I refer the Minister to my Budget Debate speech. I had spoken quite extensively about encouraging M&A as it can raise our productivity and global competitiveness. The current M&A scheme has not been well-utilised and is meaningful mainly for the larger acquisitions. I hope the Minister can review the provisions in the M&A Scheme to encourage more M&A activities among SMEs through targeted measures. It can allow, for example, higher allowances for smaller M&A transactions. It can also cover purchase of operations and businesses of SMEs rather than outright share sales, as some acquirers are wary of the potential liability associated with the acquired businesses. The acquirers who invest in automation of their acquired businesses to achieve greater productivity and to change old business models could, perhaps, also be rewarded with more generous PIC incentives or special grants. Life Insurance Tax Relief Sir, currently, taxpayers can claim tax relief on premiums paid for life insurance if their CPF contribution is less than $5,000. This $5,000 ceiling was last raised from $4,000 in 1979, 35 years ago. That increase was to ensure that the lower middle-income earners at that time continue to benefit from the concession. Income levels have changed a lot in 35 years. Many working Singaporeans are not able to enjoy this concession while their foreign counterparts can because they do not contribute to CPF. I hope the Minister can review this scheme to raise the ceiling to a more appropriate level, so that the lower middle income earners of today can benefit and will be encouraged to save more for their old age.”
“Thank you, Mr Chairman. I would like to ask the Minister of State, earlier he mentioned a figure of 145,000 sqm of shop retail space that will be coming out into the market. I would like to know where are these locations, and who are the operators of this space. Will they be mostly going to the REITs, and will that strengthen their bargaining position if they are Page: 164 given more retail space?”
“The range of schemes is daunting and often difficult for the "小白兔" or little rabbit type of small companies Mr Teo Siong Seng just spoke about, to take up. I am concerned that some schemes are too prescriptive. My colleague, Mr Giam, had, in his Budget speech, cited the example under IPG, where IDA pre-qualifies vendors for sectoral solutions under iSPRINT. SMEs may be limited to these vendors if they want a fuss-free way to tap on IPG funds. SMEs sometimes know what solution they want. A pre-qualified list may restrict the development of new innovative solutions. I declare that I had used grants from various agencies previously. Other than PIC, I have found the rest challenging in terms of application, approval wait time, making claims and writing of reports. Perhaps, we can learn from the PIC. PIC benefited from much publicity. Can we "push" schemes to SMEs by requiring the completion of a simple questionnaire in the annual filing to ACRA? This questionnaire could ask about planned investments in training, software, automation and so on that are not receiving scheme support. Based on these responses, forms for the relevant schemes or SME Centre officers could be despatched to the companies. Page: 137 Help for SMEs”
“SMEs have borne much pain from a tight labour market and continuously higher industrial and commercial rents. Supporting SMEs is vital to lift productivity across a huge swathe of our economy. In Germany and Switzerland, SMEs are celebrated as drivers of exports and economic growth. Some of their mid-sized companies have world-class capabilities and are global leaders in their fields. We should aim to help some of our home-grown companies become global leaders. First, I echo the concerns of Members who have called for attention on industrial and commercial rents. We have already lost the ability to manage rental costs, having ceded buildings that the Government once controlled to Page: 136 REITS, which now dominate the market. In commercial retail, REITS, with their huge collective hold on the market, can force up prices, sometimes steeply, with each renewal. I call on the Government to look at intervention measures, including having more industrial space of its own, to set desired rental benchmarks and to provide checks on the rental practices of REITs in the malls, as some Members have mentioned earlier. Next, on financing. MLPs have provided 3,500 loans to small companies over the last two years. Even with the Government's increased risk share, banks may still not be willing to lend to start-ups with short track records. MTI had said it does not monitor the success rate of loan applications for MLPs. I hope SPRING can work with banks to raise the awareness of MLPs and other schemes, and monitor the success rate of applications. It could intervene should banks be found to remain unduly cautious. There are also many SME schemes administered by different Government agencies.”
“As I mentioned earlier, it is important for us to see how the situation goes. Essentially, as I had mentioned earlier, N95 masks are generally not needed for short exposures, such as commuting from home to school and to work. They are not needed in Page: 9 the indoor environment. Nevertheless, we are very mindful of our workers, especially those who perform the essential services. We have worked with organisations to look at how we can facilitate the distribution and usage of the N95 masks when the haze situation comes to an unhealthy situation. They are very mindful of the welfare of their workers. Above all, it is important for us to work together as a society. We have learned from past lessons and experiences. It is a journey that we take on incident after incident. I am very confident that we are more prepared this time. 12.06 pm”
“I thank the Senior Parliamentary Secretary for the answer. I believe that I have also asked for what is the stock level that is in our stockpile now. Last year, it was nine million. So, has that level been adjusted based on the learning experience from last year? Also, I would like to know: for last year, what was the lowest level the stockpile ever reached, after the releasing of the masks from our stockpile into the major retail outlets? And I would also like to ask if, within our stockpile, the Ministry has taken into consideration now the need for children-sized masks and whether there have been suppliers found for these masks. Finally, is there any learning experience that will now be taken into consideration in terms of catering to the workers who need to work during prolonged periods of haze? Assoc Prof Dr Muhammad Faishal Ibrahim: Madam, I would like to thank the Member for the supplementary questions. I mentioned earlier in my answer that there are currently available N95 masks at major retail outlets. If we look at the inventory of the major retailers, we have about 283,000 N95 masks in their inventory. Nevertheless, for the national stockpile, we have 16 million N95 masks, of which we have forward position of about 1.7 million to our retailers as well as the CCs and Zuellig Pharma, in preparation for the volcano haze in January 2014. Certainly, we have sufficient masks available. In fact, in the last few days, I went around to the retailers and I saw that their masks were readily available. I also spoke to the people I met and some of them shared with me that they have the mask at home. The other aspect that the Member asked was the masks for children: there are currently no children N95 masks available in the market.”
“If the new measures are not sufficient to meet our SME financing and overseas expansion needs, perhaps the Government can relook into whether it is necessary to create an EXIM bank or a SME bank. In conclusion, as we honour the pioneers of modern Singapore in this Budget, like the hon Member Mr Laurence Lien, I, too, would like to think of each generation as pioneering for the next. As we approach the 50th year of our Independence and soon, the 200th anniversary of the founding of Singapore by Sir Stamford Raffles, my wish is to see a vibrant Singapore with innovative home-grown companies and dynamic Singaporeans establishing a new Singapore in this 21st century so as to ensure success for our future generations. 3.33 pm”
“In a reply to my Parliamentary Question (PQ), MAS has said that it does not call for banks to require that SMEs need a project track record or any specific requirements in order to get a loan. In evaluating loans, financial institutions all have their own criteria, some of which can make it rather difficult for companies, especially those with shorter track records to secure a loan. This may be so even with Government risk-sharing. I hope the increase to 70% will help a bit. IFS loan caps have now been doubled to $30 million per company. I would like to know, from past evidence, if IFS and existing Government supported financial schemes have sufficiently met the overseas expansion needs of our companies. The total value of loans approved under IFS declined yearly from $378 million in 2010 to $121 million in 2012. Similarly, the Loan Insurance Scheme (LIS) and LIS+ saw total values of loans approved fall from $2.3 billion in 2010 to $1.3 billion in 2012. The Economic Strategies Committee (ESC) had called for an EXIM bank in 2010, only to be deemed not feasible by MOF a year later. There were notable disappointments from the business communities at that decision. Our companies are disadvantaged when compared to other countries like Taiwan, Japan and South Korea where the percentage of total business credits going to SMEs range from 50% to 76%, compared to 27% in Singapore. Even with the increased Government risk-sharing, would financial institutions still be too Page: 87 conservative in their approach as they still need to bear some risk and there are less risky things to do? I hope the financing situation for SMEs will be closely tracked.”
“The remaining 3% were for the other four categories, including Research & Development (R&D) and acquisitions of intellectual properties. I believe innovation is important if we are to derive a lot more out of our companies. I hope we can encourage investments in creating breakthrough business models and technologies. In their pre-Budget survey, professional services firm KPMG found that 50.3% of 159 companies surveyed felt that the innovation measures in PIC have had no impact on raising innovation. The same survey found that only 1.6% of the Page: 86 respondents were focused on driving innovation. The survey highlighted a worrying finding that SMEs and even Singapore public-listed companies have not found benefits in innovation measures. Respondents in that survey commented that Inland Revenue Authority of Singapore (IRAS) has been very strict in administering incentives for innovation, favouring revolutionary development at the expense of more market-driven evolutionary development. IRAS has a very strict definition of qualifying R&D activities. Indeed, this has been my personal experience, too, speaking with technology companies trying to develop the next killer app, or a potential industry game-changing software. They have not been successful in claiming PIC for their R&D manpower, based on the strict PIC definition. I hope IRAS and MTI can review the criteria and work on a more market-oriented definition of research and innovation and to drive more adoption by companies in this area. Finally, in the area of SME financing. This Budget provides for increased Government risk-share on micro loans to SMEs from 50% to 70%.”
“We can loosen the definition of M&A Page: 85 to include such types of acquisitions. We can also incentivise the acquirers to automate the operations of their acquired businesses to achieve greater productivity and to revamp old business models. We can look at allowing even higher than 400% tax allowances in PIC for investment in automation for merged entities to get them to speed up investments in productivity improvements for the acquired operations. I note that both the Singapore Business Federation and the Association of Small and Medium Enterprises (ASME) have also issued recent statements for the Government to do more to promote M&A, including improving M&A tax allowances. They too cited the need for industry consolidation to create more breadth within industry clusters for better economies of scale and to reduce marginal costs. Besides tax allowances, the Government could also look at how financing can be made more readily accessible for M&A. For example, ASME had called for an equity financing scheme to help SMEs fund local and overseas M&As. Such a scheme would make available the option for companies to take on loans for acquisition through pledging equity in private companies. This can be done with risk-sharing collaborations between the banks and our Government. This will be a useful tool for deserving ambitious companies in our midst to grow rapidly through strategic acquisitions and take on the international markets. Next, on the innovation mindset of our companies. SMEs are grateful that PIC has been extended for three more years. The scheme has helped defray costs, and many companies have just started to use it. As of April last year, 97% of the claims were for purchases of IT and automation equipment and for employee training.”
“Many are micro enterprises that may not even employ the three non-shareholder staff required to qualify for PIC cash payouts. Even for small companies that qualify, they may not have the scale to benefit meaningfully from investments in major automation. Many of our smaller companies are struggling to stay afloat under the tight manpower and high rental cost environment. While raising their productivity and injecting innovation into their businesses should be the way to go, these companies need to scale up first. Last year, I had argued for the need to stimulate Merger and Acquisitions (M&A) so that enlarged companies can better take advantage of economies of scale. I wish to repeat my desire to see changes to tax incentives to encourage M&A. There is an M&A scheme, first introduced in 2010 and enhanced in 2012. As of May last year, only 42 companies have used the scheme. Thirty-four were companies which MOF classified as SMEs with annual turnover of up to $100 million, which meant that many could be fairly sizeable companies. The average and median size of deals supported by the scheme was $25 million and $3 million respectively. The scheme provides meaningful tax incentives for large- and mid-sized deals but not for acquiring the small and micro enterprises. I hope to see the Government encouraging consolidation amongst smaller companies through enhancing the M&A scheme. The M&A scheme could be graduated to allow higher tax allowances for smaller deal sizes of up to $1 million in value. Also, the current scheme allows only for the outright purchase of shares. Some acquirers prefer to buy over the operations and businesses of SMEs, but not the entire company as they prefer not to be entangled with liabilities that may be associated with target companies.”
“I find it strange that the Centre-based Financial Assistance Scheme for Childcare (CFAC), which is the equivalent scheme for childcare, can be used on all MSF-registered childcare centres. However, when it comes to kindergartens, MSF has imposed various conditions that had prevented others from qualifying. These include conditions, such as the operators cannot have any religious or racial affiliations and cannot be private operators. None of these conditions is required for CFAC. I am not sure what will be announced at the Committee of Supply (COS), but I certainly hope that the schemes can be extended to many more, if not all MOE-registered kindergartens. MOE has said that character and values education are important. Many of the kindergartens with religious and racial affiliations, such as those run by Buddhist groups, Huay Kuans, Muslim groups, churches and other VWOs, do take in children from the public and have strong character and values education. I wish to see them being included. I will speak again on this during the COS debate. Next, SMEs. I wish to declare that I own and operate private companies classified as SMEs. Page: 84 While Singapore enjoyed 4.1% economic growth last year, this economic growth had come about solely because of the growth in manpower. GDP growth is defined as workforce growth plus productivity growth. Productivity growth last year was zero. We cannot depend on economic growth through workforce increases. The Government's long-term goal is to reach 2%-3% annual productivity growth by 2020. At last year's debate, I spoke of the need to encourage industry consolidation. The current schemes, such as PIC and now PIC+, tend to benefit the larger companies. We have over 150,000 SMEs in Singapore.”
“We should respect them, we should honour them for their contributions to Singapore. Next, I would like to touch on two issues: education and Small Medium Enterprises (SMEs). I shall continue in English. (In English): Mdm Speaker, in the area of education, the Minister has announced that the Kindergarten Financial Assistance Scheme (KiFAS) qualifying income criteria have been raised so that more families can benefit. This is welcomed. KiFAS is now extended to all MOE Kindergartens and to those Page: 83 operated by the anchor operators. Previously, only PAP Community Foundation (PCF) qualified for KiFAS. I am puzzled why the extension announced by the Minister is to only these few operators. There are around 500-MOE registered kindergartens in Singapore. PCF operates 235 kindergartens. MOE has five, with up to another 10 being planned for the next few years. NTUC does not operate kindergartens. The three new anchors are childcare operators. I believe that they operate just seven premium kindergartens between them. In any case, the anchor operator scheme is a childcare programme and not a kindergarten scheme. The commercial operators have to set up new operating entities to separate their current operations from the childcare centres that they will operate as anchor operators. So, in effect, parents still do not have many choices of which kindergartens they can send their children to in order to enjoy KiFAS. From my understanding of the landscape and based on the announcement that was made, they may now choose between PCF kindergartens and five MOE Kindergartens. Madam, I had spoken about this before.”
“Mdm Speaker, in Mandarin, please. (In Mandarin): [Please refer to Vernacular Speech.] Mdm Speaker, I am pleased to see that we are honouring our Pioneer Generation through the Pioneer Generation Package. My parents came to Singapore from Malaysia in the late 1950s. They met each other at the then-Teacher Training College, married before Singapore's Independence and became Chinese teachers in Chinese schools. They have since lived here and become Singapore citizens. They worked as Chinese teachers for over 30 years until their retirement. It was a turbulent era when Chinese schools were the main ideological battleground. Singapore at that time was trying to fight against the Communist influence. My parents have been living in the same house since 1960, which is in the current Joo Chiat SMC. There were then still many farms at Kampong Chai Chee opposite our backyard. The story of my parents is shared by many of the senior residents in Joo Chiat. They have lived in the same house for more than 40 or 50 years, and have already retired from an ordinary job for many years. Medical cost has always been their primary concern. Even though they have not had any income for many years, they still could not get many of the Government subsidies for their medical expenses simply because they live in private housing. The Pioneer Generation Package will be provided to all eligible Singaporeans, regardless of their housing types and income levels. In this House, many Members of Parliament are children of the Pioneer Generation. The Pioneer Generation did not leave Singapore because of the danger and hardship we were facing at that time. They are just ordinary people doing ordinary jobs. Singapore owes her prosperity to this generation's hard work.”
“Thank you, Mdm Speaker. I would just like to seek an additional clarification. Earlier, in one of the replies to my question prior to this, the Ministry had said that the policy for what to do with students will depend on a school-to-school basis. I would like to know if the Ministry has a general consistent policy across the board because we are going to have more and more schools going into the DSA system and more and more students coming through DSA. So, would it be better to have a clearer communication across all schools? I also understand the explanation that, for example, if there is sports injury, then there would be a good reason for them to move to another activity. But what if the students have no good reasons and they just wish to drop the CCA? What would the Ministry advise schools to do in such circumstances? Page: 12”
“Thank you, Mdm Speaker. I would like to ask the Minister is there a bond for the international Page: 12 students that seek deferment and is there a maximum duration that is allowed for these students to have their deferment.”
“It is about the policy in general. If you do not have the number, what about the policy?”
“I would like to ask the Minister of State what is MOE's policy with regard to students who drop out of the CCA activities that they were selected in through DSA, say, after one or two years in the school? And does the Ministry keep track of this number? Page: 33”
“Also, in the globalised and higher competitive job and economic environment of the 21st century, it will be important to impart the mindset for creativity and innovation to the SIT graduates. Finally, I will end with the continuation of the story of Lawrence, the banker whom I spoke about earlier. He did not have good academic results earlier in life and just barely made it through to the then-new third university, SMU, through an alternative admission pathway. He shared that he now feels he is as good as the graduates of the other established universities and had been able to prove that in his career. SIT will certainly face a lot of challenges competing with our other local universities in order to establish itself. I look forward to the "can-do" spirit in its pioneers to define the Institute of Technology brand in their own way to make it one that will be as desired as the rest of our universities. 7.16 pm”
“SIT could be required to focus on working with emerging medium enterprises so that the undergraduates, in their most explorative and creative years, could help inject fresh ideas and innovation into the medium enterprises. Switzerland and Germany have strong vocational and technical education. Their technical universities have strong history of linkages with the industries, allowing the country to build up their industrial abilities such that their SMEs can provide quality products desired worldwide. To make their degree more relevant to the targeted industries and the graduates more marketable, SIT could explore external validation where possible by industry associations. In Germany, vocational graduates are highly respected because the graduates often enter into guild-like professional associations that continue to guide post- Page: 121 graduation career development and also collective bargaining. While this is beyond the scope of SIT, the Government could think of setting up the infrastructure to promote and support these developments. Support can include providing training, assistance and even grants to help medium sized companies dedicate resources for collaboration with technical universities and to spur these companies to develop rigorous internship and apprenticeship programmes. Next, some of our local universities may have larger than average proportions of international students such as Yale-NUS College. In answer to my Parliamentary Question last year, MOE said that higher proportions of international students are required for specialty colleges to provide the diversity needed for this type of courses. SIT can focus on locals and gear them for the skilled jobs needed to help build stronger local industries.”
“Second, SIT will face challenge for students from the more established local comprehensive research-based universities in the form of NUS and NTU, niche universities like SMU, SUTD and Yale-NUS College and from UniSIM, a teaching university with a longer history through its open university background and its association with SIM. This is especially so when SIT opens its programmes to "A" level school-leavers. This is a challenge for the SIT pioneers; its management, faculty staff and students to rise up to in order to establish the branding and recognition for SIT. Starting afresh will allow SIT to explore its own niches. As an applied and practice-oriented university, the role of the industry will be important to SIT. I believe strong links with the industry will be necessary, such as attachment programmes and experiential learning. SIT's current batch of students are likely to be more matured in age than NUS, NTU and SMU and may have work experiences, especially the pioneer batches. SIT can continue to play a useful role for working people wanting to acquire a degree. To cater to such students, SIT can explore modes of operations that fit them better. This can include shorter quarterly academic terms of three months. Where practical, it can also explore the sandwich degree arrangement where students will need to undertake a placement year or longer internship in the industry, typically in the second or third year of studies. SIT could play a role in strengthening Singapore's technical capabilities. I had previously shared in this House of my concerns of our SMEs not able to grow under the shadows of MNCs and GLCs. This may be an opportunity to help our medium enterprises in key industries we wish to develop.”
“Their graduates are highly sought after by top technology firms around the world. The Massachusetts Institute of Technology is widely recognised as one of the best universities in the world. It began humbly in 1861 with three principles: (a) the educational value of useful knowledge; (b) the necessity of "learning by doing"; and (c) integrating a professional and liberal arts education at the undergraduate level. I like its strong emphasis on the practical aspects of learning. What will SIT, a newcomer in the business of university education, evolve into? How will the brand of "Institute of Technology" in Singapore be defined? I wish to share some practical concerns for SIT going forward. First is the lack of a single campus, unlike the other universities. A physical campus is important to generate a sense of identity and belonging amongst the students. SIT facilities are decentralised across the different polytechnics, dispersed throughout Singapore. Students will be at the polytechnic where their programmes are being offered. They feel a greater sense of identity with the polytechnic rather than with SIT. SIT also does not have hostel living which NUS and NTU have, which can provide important experiences for university students in their total development. While I understand the history of SIT and why it was decentralised at its formation, it may be useful to consider a central campus in the future when it becomes feasible to do so. Meanwhile, SIT may have to work harder at building its identity amongst students through programmes that may cut across physical Page: 120 facilities.”
“He qualified through SAT, worked even harder and graduated with Second Upper Honours. He has now worked at two international banks and is a proud father of two. He was grateful for that break to do his studies in a local university as the cost in a private university would have been very high. SMU was then the new third university offering chances at university education to people like Lawrence. SIT was established in 2009 primarily to allow polytechnic graduates to top-up their diplomas to an external university degree in a field related to their polytechnic studies in targeted growth fields. With this Bill, SIT will now be a university able to offer undergraduate and postgraduate programmes of its own. Page: 119 What is the "Institute of Technology" brand? People would associate a learning institution with such a name with industrial, engineering, sciences and technology capabilities. I did a google search on the term "Institute of Technology". It threw up a long list of universities and polytechnics from all over the world. These range from lesser known educational institutions to those with long and rich histories and which are highly ranked in the world. The Swiss have long established themselves as a centre of technological and scientific research. Their two federal universities that are classified as Institutes of Technology are highly ranked globally. They have produced many Nobel laureates, including Albert Einstein. Germany too has a strong engineering and technology history. They also have highly sought after Institutes of Technology. The nine largest and most renowned technical universities in Germany have formed the TU9 German Institutes of Technology. There is also a family of Institutes of Technology in India whose alumnus run Fortune 500 companies.”
“Mr Deputy Speaker, I rise in support of this Bill. The Prime Minister had announced last year the creation of two new local universities, the Singapore Institute of Technology (SIT) and the Singapore Institute of Management University (UniSIM). These will be Singapore's fifth and sixth universities, certainly a big change from when I was a student and there was only the National University of Singapore (NUS). Last year, then-Senior Minister of State for Education, Mr Lawrence Wong, had said Singapore's economy has room for more graduates. Indeed, the desire of our local population for higher studies has long been there. In 2011, in response to my Parliamentary Question, MOE revealed that there were about 41,000 Singapore Citizens and Permanent Residents who were pursuing undergraduate degrees at private universities and Private Education Institutions. For every local studying in a publicly funded autonomous university, there was another local studying in a private university here. The number of locals pursuing private university education is even larger when we consider those studying overseas, as MOE did not track this number. These recent moves will see more locals being supported in their aspirations for places in Government-funded university education. Last month, I had a chat with a young banker named Lawrence. Lawrence told me that he was playful when young and just managed to make it into the polytechnic. It was at some point during his polytechnic studies that he decided he needed to work harder. He graduated from the polytechnic but was unable to secure a place at NUS or at the Nanyang Technological University (NTU). He said he was fortunate that the Singapore Management University (SMU) allowed him to take the SAT examinations.”
“The second is that this Act provides the power for the inspecting officer to detain and arrest any suspected illegal tour guide if the officer reasonably believes that he or she has committed a crime as defined by the Act. The arrested person can be brought to a police station for questioning. The tour guide may be in the midst of handling a busload of foreign visitors. The arrest would leave these visitors stranded in the middle of a tour destination. For practical considerations, inspecting officers must handle the situation carefully, or it may leave a bad impression in the eyes of our foreign visitors. Procedures on how to inform the tour agency involved and getting an immediate replacement tour guide from the agency and other arrangements to allow the suspect to settle the visitors first will be important. This is to minimise disruption to the innocent visitors who are just out here to enjoy Singapore.”
“Mdm Speaker, I rise in support of the Bill. As the Second Minister has stated, the issue of illegal tour guides is a growing problem, rising with the tourism boom in Singapore in recent years. Tour guides in Singapore need to undergo recognised courses and examinations in order to be licensed. There are over 2,300 licensed tour guides here, made up mostly of Singaporeans and Singapore Permanent Residents. Illegal tour guides not only affect the livelihood of local guides but they may provide wrong information about Singapore and damage our efforts to promote Singapore as a tourist destination. Page: 52 Hence, I support the measures in this Bill that will provide greater powers for the authorities to act against illegal guides, such as fines for both the illegal guides and tour agencies that knowingly engage their services, and greater clarity on what constitutes illegal guiding. I have two areas which I wish to highlight for operational considerations. The first is about the Taxi Tourist Guide scheme launched in 2004, 10 years ago. The scheme is to train and license taxi drivers to allow them to act as tour guides for small groups of tourists. Section 19C of this Act defines a tour guide as somebody who "provides any guiding services to eight or more tourists". A taxi can never take eight or more passengers. Hence, there seems to be some discrepancies here. Does this mean that the taxi drivers who wish to act as tour guides do not need any licensing and the Taxi Tourist Guide scheme is now redundant? On the topic of taxi tourist guides, I would like to understand from the Minister if the scheme has been popular and, if not, what may be the reasons.”
“Thank you, Madam. I have four related supplementary questions. The first is: what is the kind of arrangements between the Home Team and the private security company in ensuring the suitability of the APOs for the various types of job functions? The second is: what sort of decisions go into deciding what type of job functions can be outsourced? The third is: is the training the same for the APOs and full-time officers performing the same duty? The fourth is whether any of the APOs are allowed to start their work before completing all the trainings required of them.”
“Thank you, Mdm Speaker. Just a quick supplementary question for the Minister. I understand that independent schools, for example, can make their own hiring and firing decisions. I would like to know, for the rest of the schools, what sort of decisions can the principals make in terms of the selection of the teachers.”
“I thank the Minister for the answers and the table. I have one supplementary question. I would like to understand a bit more about the criteria for the $550 per capita income or $1,700 household income cap for ComCare. I would like to know if this is based on any research or international norms, or if this is a definition by MSF about minimum living income. I would like to also know how and when MSF would consider adjustments to these lines that are being set. Page: 31”
“Madam, I thank the Senior Minister of State for her comprehensive answers. Earlier, the Senior Minister of State listed the number of EOI safeguards that must be fulfilled before information will be released. I would like to know how these are applied under FATCA. Do these apply or are information auto-transmitted?”
“This Bill allows the Minister to negotiate and conclude the IGA, declare it as effective and to implement it. There is no need to debate and ratify the IGA in Parliament. In Switzerland's case, the IGA was entered into in February 2013. The Swiss Parliament voted to ratify it in September 2013. Our Government is now asking Parliament to approve the implementation of an IGA with the USA that does not yet exist and for which we do not have the details on. Should Parliament not have more details of the IGA so that we can better understand the full implications of this Bill? In conclusion, there could well be international pressure and good reasons for Singapore to enter into compliance with FATCA and, in future, with other countries on a similar type of agreement. At the same time, there are questions that Singaporeans would want answers to, and to know the implications of our compliance with FATCA. Therefore, I seek the Senior Minister of State's answers to the questions I have raised. 3.49 pm”
“Are there any safeguards to limit extraterritorial implementation of foreign laws to prevent overreach by any foreign government on Singapore citizens? Generally, as the Senior Minister of State had stated, it is expected that any treaty or international agreement should be fully reciprocal. What reciprocal rights will we have on US citizens on similar matters? This leads to my fourth concern, on the risk of political blowback. Even with full reciprocity in agreement, there are already some quarters in the USA resisting FATCA for fear of reciprocity requirements by foreign governments will compromise the constitutional privacy rights of US credit union members and bank customers. Requests for information by foreign governments, including Singapore Government, in the USA may be stalled in their courts. What would our Government do in the event of limited reciprocity due to US domestic politics when we have implemented our IGA with the US? My fifth concern is whether this concession to the US may open the door for demands for similar concession by other countries. The Bill provides for similar implementation with any other countries beyond the US that Singapore will make similar type of tax compliance agreements with in future. Are there similar agreements some of our other big trading partners will be expecting of us soon in their efforts to identify their own tax evaders in the form of their own FATCA? If so, which are the countries? Would this lead to a situation where many account holders in Singapore financial institutions become subject to foreign scrutiny, with greatly increased compliance costs? Page: 61 My final concern is to understand the parliamentary process.”
“In the IGA reached between Switzerland and the US, three of the six objectives are to: (a) increase "legal certainty by clarifying which Swiss financial institutions are subject to FATCA implementation"; (b) "reduce implementation costs including by suspending, under certain circumstances, certain withholding and account closing obligations"; and (c) "simplify the necessary due diligence procedures". The joint statement with Japan also has similar provisions benefiting Japanese financial institutions. Can the Senior Minister of State clarify what are the similar provisions in our proposed IGA on FATCA? My third concern is about the impact on Singapore citizens. FATCA does not only affect US citizens but is targeted at anyone who is potentially earning a US taxable income stream. A person takes the definition of a "US person", which is indicated by any one of the following: (a) US citizenship or permanent residence (green card status); (b) A US birthplace; (c) A US residence address or a US correspondence address; Page: 60 (d) Standing instructions to transfer funds to an account maintained in the United States, or directions regularly received from a US address; (e) An "in care of" address or a "hold mail" address that is the sole address with respect to the client; or (f) A power of attorney or signatory authority granted to a person with a US address. This definition could see many Singapore citizens being identified as a US person. In a Model 1 IGA, our Government may have to automatically transmit information on Singapore citizens who are deemed as US persons to the USA. What is the Government's estimation of how many Singaporeans will be deemed as US persons in the implementation of FATCA?”
“" In the matter of bilateral agreements, governments form arrangements on a mutually beneficial basis. There will be compliance costs. There will be cost incurred by our Government to collect data on behalf of the US. We will be facilitating the US government to implement one of their laws. Singapore currently has comprehensive DTAs with 71 countries providing for exchange of information, but not with the US. We have only a limited treaty with the US covering shipping and air transport income. I would like to ask the Senior Minister of State if we are currently negotiating a comprehensive DTA with the US or seeking other concessions Page: 59 from the US in view of us facilitating FATCA. If so, what are these? My second area of concern is about the cost of compliance. Countries that opt for Model 2 will let the financial institutions deal directly with the US IRS. There will be compliance costs for the financial institutions as they need manpower to deal with queries from the US and to change their IT systems to comply with FATCA. In the Model 1 supported by Singapore, our Government will collect data from financial institutions for the US. While this will make compliance with FATCA easier for our financial institutions, compliance costs will be transferred to the Government and, therefore, to the taxpayer. What is the expected annual compliance cost and would our Government be carrying this cost? If not, how will this cost be borne?”
“Given the importance of the US as a political and economic partner of Singapore and the trend of countries complying with FATCA, it is understandable that Singapore will want to work Page: 58 with the US on this matter. The US Department of Treasury provides two IGA models. Model 1 involves financial institutions in the partner countries reporting information about US accounts to the partner country's tax authority, which then provides the information to the US authorities. Model 2 involves financial institutions reporting directly to the US Internal Revenue Service and partner countries agreeing to lower legal barriers to reporting. All the countries that have concluded IGAs with the US are on Model 1, except for Switzerland, which concluded a Model 2 agreement. Japan is also considering Model 2 as well. According to the Swiss Finance Minister, Model 2 "better protects privacy and sovereignty." Swiss banks will have to report accounts belonging to US taxpayers above a minimum balance, but client's data will only be exchanged once the US authorities have requested administrative assistance. Singapore had signalled that we will be implementing Model 1 IGA with the US. I would like to raise six areas of concerns with the Senior Minister of State on this matter. First, it is about mutual benefits. In a reply in Parliament in 2009 to a question regarding Singapore being on the OECD's "grey list" of countries committed to internationally agreed tax standard, then Second Minister for Finance Mrs Lim Hwee Hua had said that "Singapore is starting talks with several countries to update our DTAs (Double Taxation Agreements) with them on a mutually beneficial basis, including having exchange of information provisions that are in line with the new international Standard.”
“Mdm Speaker, I will speak on the parts of the Income Tax (Amendment) Bill that relates to the agreement with the United States to implement the Foreign Account Tax Compliance Act (FATCA). The amendments contained in this Bill are effectively facilitating compliance of our financial institutions with FATCA to assist the US government with identifying tax evaders as deemed so by the laws of the United States. FATCA affects financial institutions and is a matter of relationship between the US government and financial institutions with US source income streams. Typically, foreign governments are not obliged to help facilitate this relationship. Singapore is taking an extraordinary step to facilitate compliance. As of June 2013, the United Kingdom, Denmark, Mexico, Ireland, Switzerland, Norway, Spain, Germany, France and Italy have concluded inter-governmental agreements (IGAs) to cooperate with the US on FATCA implementation. Japan and South Africa have consented to cooperation as well. We will be the first and only country in ASEAN to take such an action of cooperation with the US. Various other countries, such as Hong Kong, are in talks with the US on their own IGAs. The Senior Minister of State has explained the reasons for Singapore to enter into IGA with the US on FATCA. The US has made it clear that financial institutions operating in countries that do not sign IGA with US IRS by the end of this year must sign individual agreements with the US tax authorities. Failure to do so will subject the financial institutions to a 30% withholding tax, as the Senior Minister of State has explained.”