Committee of Supply – Head S (Ministry of Manpower)

Singapore Core and PMEs

Mr Patrick Tay Teck Guan (West Coast): Madam, I beg to move, "That the total sum to be allocated for Head S of the Estimates be reduced by $100."

I have been lobbying on Labour market testing, strengthening the Singaporean Core and greater protection for our local professionals, managers and executives (PMEs) since 2011. It has been an arduous, but positive journey.

We have seen the introduction of the Fair Consideration Framework (FCF) and the National Jobs Bank in 2014. There is also greater focus and awareness of the move towards not just fair, but progressive workplaces and employment practices by the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) and our tripartite partners. However, anecdotally, when I meet fellow PMEs, I am still hearing complaints of two kinds.

First, the hiring-of-own-kind practices and companies advertising in the Jobs Bank for the sake of advertising and treating FCF and the Jobs Bank as mere window dressing. This happens not just in big multinational companies (MNCs), but also small and medium enterprises (SMEs). Some also share with me that employment agencies and placement companies are also where some of these malpractices happen. The general concern is over the glaring disproportionate number of foreign PMEs in certain sectors and companies. In some cases, the nationality bias results in job losses of local PMEs and hiring of foreign PMEs for jobs which local PMEs can fill.

In this regard, I wish to ask the Ministry of Manpower (MOM) to provide an update on how effective FCF has been the past 18 months since the implementation in levelling the playing field for our local PMEs and in eradicating "nationality bias" discrimination in hiring practices, including by employment and placement agencies.

I know the Minister shared that he has nailed 150 companies into what he calls the "watch list" where he sees the "double weak". I also know he has been having coffee with some of these employers and businesses on the "watch list". Has there been an improvement since the last time he shared about this "watch list" and can he share who these companies are?

In the same vein, I wish to ask about the progress of the National Jobs Bank and how MOM and the Workforce Development Agency (WDA) have been able to make use of the data to extrapolate the job openings and identify the skills gap to better facilitate job matching and employment, especially for PMEs.

As I am also very concerned with the placement rate from the Jobs Banks, I have three concrete suggestions for MOM, in respect of what we can do to tackle those companies with the "double weaks", to better strengthen the Singaporean Core.

Suggestion one – to put a clamp on companies with discriminatory practices, I propose a company-specific and tiered approach which can be scaled up to the industry level, if needed.

Level 1 involves stringent scrutiny of companies which display the two "weaks". Those with a weak Singaporean Core and a weak commitment to hire and develop Singaporeans will be identified and differentiated. Stricter Employment Pass (EP) application conditions and requirements are to be enforced on these companies.

Level 2 involves suspending all EP applications of the companies identified at Level 1 which continue to show a disregard or weak commitment to hire and develop a Singaporean Core and turn a deaf ear to warnings.

Level 3 involves imposing a PME dependency ratio. Should companies remain recalcitrant, a company-specific PME dependency ratio can be put in place as a final option.

Suggestion two – to encourage building a strong Singaporean Core, companies which outsource some of their services, such as information technology (IT), human resource (HR) or accounting and even construction projects, can, within the terms of the tender or contract prescribe that there must be a Singaporean Core in the workforce of that entity bidding for the contract or tender. I suggest the public sector can take the lead in this.

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Suggestion three – over and above existing requirements under the law, there could be tighter regulation and accreditation of employment and placement agencies to weed out biased and unfair hiring-of-own-kind practices and ensuring a strong Singaporean Core. By the same token, these agencies, recruitment companies and even company HR departments should not and must not treat the advertising requirement as mere window dressing and their practices should be closely monitored. Their frontline and placement staff should undergo mandatory training and accreditation to understand the concept of building the Singaporean Core and the objectives of both FCF and the Jobs Bank.

On the converse, I suggest that MOM also recognise and offer carrots to those companies and businesses which demonstrate an exemplary and progressive Singaporean Core and a resolute commitment to hire and develop Singaporeans. In short, I submit that MOM must make it "tougher for the weaker and better for the stronger". Mdm Chair, in Chinese, please.

(In Mandarin):[Please refer to Vernacular Speech.] I have three suggestions regarding how to strengthen the Singaporean Core of our workforce.

First, for individual companies, I propose a company-specific approach to eliminate the discriminatory practices. Level 1 involves those companies that have the double "weaks". Stricter criteria are to be applied when they apply for EPs.

At Level 2, if those companies identified at Level 1 turn a deaf ear to warnings, we will suspend the application of their EPs.

At Level 3, should the companies remain recalcitrant, a PME dependency ratio can be imposed.

Second, prescribe in the outsourced contract certain rules and regulations to make sure that contractors build a team of staff with Singaporeans as their core. The public sector can take the lead in this.

Third, make sure employment agencies advertise job vacancies according to the legal requirements. In addition, their frontline staff should undergo training so that they better understand FCF and the Jobs Bank. Conversely, MOM can also consider rewarding those companies whose staff have a Singaporean Core.

More Support for Singaporean Workers

Assoc Prof Dr Muhammad Faishal Ibrahim (Nee Soon): Madam, since late last year, going around the coffeeshops and local events in my constituency, I could sense that my residents have started seeing and feeling the impact of an economic slowdown. Firstly, they observed the slowdown in international markets and, they have being observing such signs in Singapore. They are worried for fellow Singaporean workers, especially their family members, neighbours and friends.

I would like to ask the Minister, given the current economic slowdown, what will the Government do to help displaced local workers when companies have to downsize or close down. For example, is there scope to increase the number of Professional Conversion Programmes (PCPs) to help retrenched professionals, managers, executives and technicians (PMETs) to find jobs in growth sectors?

Our older workers are also worried about the current economic slowdown, as they feel that they are the ones that are going to be affected the most. May I know how is the Ministry going to help older workers to save their jobs?

Madam, I have also come across discussions about the balance between Singaporean and foreign workers. There are companies which have the locals' interest in their hearts, although they have a regular EP inflow. However, there are also companies whose hearts are not with our locals, where I received feedback that they use the locals in filling up the numbers and are not particularly interested in developing our local workers. I would like to ask the Minister what is being done to manage the EP inflow and ensure that the EPs complement rather than compete with locals, and what more can we do for our people. Allow me to continue my speech in Malay.

(In Malay):[Please refer to Vernacular Speech.] Madam, in my interactions with the Malay community in Nee Soon and in events organised by Malay/Muslim bodies, just like other Singaporeans, they expressed concern about an economic slowdown. They are worried that their jobs, as well as the jobs of their family members and friends, will be affected by an economic slowdown.

Madam, we must provide more support to our local workers. I would like to ask the Minister what types of support will the Ministry provide to help displaced local workers when businesses have to downsize or close down. In addition, how will the Ministry help older workers save their jobs? Related to that, what is being done to manage the EP inflow and ensure that they complement, instead of competing with locals?

Manpower-lean Enterprises and Industries

Mr Lee Yi Shyan (East Coast): Mdm Chair, in the face with tightening labour supply, manpower-intensive sectors, such as retail, food and beverage (F&B) and hospitality, are finding it hard to cope with their day-to-day operations. Some businesses have expressed doubt that they could ever expand even if demand for their businesses increases, shortage of workers being the main constraint to growth.

Nonetheless, many SMEs in the services sectors have realised that relying on manpower to grow their businesses is not a long-term solution. They are responding to the Government's call to raise productivity.

SMEs are seeking ways to improve, to become more efficient and effective. For most, improvements made are piecemeal and incremental, often not significant enough to eliminate existing headcounts or avoid new hiring. Not surprisingly, therefore, only SMEs which undertake fundamental changes revamping their business models stand a good chance to succeed and become manpower lean. But the learning curve is steep.

Implementation experiences from SMEs attempting major revamps often suggest that manpower loading can become worse before it gets better. This is because businesses need to maintain two parallel systems until the new one stabilises and can replace the old system.

May I ask, therefore, how the Ministry would coordinate the efforts of the various agencies to help SMEs to embark on holistic and comprehensive re-modelling of their businesses? How would the Ministry address SMEs' needs for additional manpower during their transformation efforts?

Apart from helping individual SMEs, does the Ministry see any benefits of grouping SMEs of the same industry for effective intervention? Would the Ministry provide an update on what the response to the Lean Enterprise Development Scheme (LEDS) has been since its launch in September last year? What are the profiles of LEDS applicants so far?

Mdm Chair, a number of trade associations and chambers (TACs) and businesses I talked to very much welcomed the Industry Transformation Programme (ITP) announced during Budget. Businesses have high hopes that ITPs will be able to meet sectoral needs because of their customised nature.

While recognising that there is much we need to do in embracing technology and modern management as part of the restructuring, some businesses are also worried whether we will have the right quantity and quality of workers and skills to support the restructuring efforts. Given that our labour participation rate is already almost the highest in the world, our indigenous workforce growth tapering off, businesses question if we should selectively let in foreign talents with skillsets to strengthen our Singapore Core, to render our workforce more competent and versatile overall.

Aligning our HR development strategy and skills upgrading programmes with ITP is, therefore, the best way to ensure success in our economic restructuring. The close working relations among the public and private sectors and the unions are pivotal.

In this regard, may I ask how the Ministry is involving the tripartite partners in the development of ITP and their roadmaps? Would MOM officers be represented in the Transformation Champions to co-drive ITP?

Manpower Policies

Mr Lim Biow Chuan (Mountbatten): Mdm Chair, over the past year, I have seen more Meet-the-People Session (MPS) cases where residents seek help because they have lost their jobs and are unable to find alternative jobs.

In a recent Straits Times article, it was reported that higher-skilled workers make up the bulk of layoffs. More than seven in 10 who lost their jobs last year were PMETs. This is quite disturbing as one would have expected that higher-skilled workers would have less difficulty keeping their jobs.

Given that the economic lookout for the next year appears much weaker, I am concerned that more Singaporeans, especially PMETs, will find themselves displaced and unable to find another equally well-paying job. There is little comfort if Singapore proclaims that we have full employment when, in actual fact, the majority of unemployed workers are Singaporeans.

I would like the Minister to update the House on how effective the Jobs Bank is, in helping Singaporeans find alternative employment. What about efforts by the Employment and Employability Institute (e2i) and the Community Development Councils (CDCs) in helping Singaporeans find employment? Would there be a report card on their efficacy?

Can the Minister also comment on whether companies are simply complying with the rules without making any real efforts to help Singaporeans find jobs? If so, what can MOM do to discourage such companies which are not sincere in providing employment for Singaporeans? If such companies list their vacancies in the Jobs Bank without any effort or attempt to employ Singaporeans and instead insist on employing foreign workers on EPs, would MOM consider imposing a one- or even two-year ban on the company from employing any foreign employees? Send a strong signal to these companies that there are serious consequences for flouting the rules.

Can the Minister also share how we can tweak our policies to ensure that Singaporeans are able to find alternative jobs quickly if they are retrenched or lose their jobs due to no fault of theirs?

I urge the Government to ensure that Singaporeans should always remain the core of the workforce. Any foreign workers who come to Singapore to work on an S Pass or EPass should complement our workforce rather than displace our Singaporean core.

I had, in my Budget speech, asked the Government to consider introducing a retrenchment benefit law to ensure that Singaporeans who have lost their jobs would receive compulsory compensation whilst they reskill themselves. Many other countries have similar retrenchment compensation laws. I know that this will have a financial impact on the companies. But I urge the Government to study this so that we can be fair to employees who have lost their jobs through no fault of theirs and, in the process, allow them some time to find alternative employment. It will also deter companies from retrenching their staff just so that they can employ less expensive foreign employees. The details can be worked out so that the financial burden would not be too heavy on the companies.

Transform SMEs amid Changing Demography

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Mr Thomas Chua Kee Seng (Nominated Member): Madam, in Mandarin.

(In Mandarin):[Please refer to Vernacular Speech.] Good afternoon, Mdm Chair, fellow Members of Parliament. The manpower problem faced during the economic transformation phase is of great concern. For example, when PMETs from MNCs sought employment with SMEs recently, employers hesitated because of their "high education, high position and high pay". PMETs on the other hand, felt that the environment and benefits of local SMEs are not as good. They were stranded in a situation of mismatched expectations.

This is a regrettable situation. On one hand, SMEs are unable to hire talents while, on the other hand, PMETs are unable to find employment. This situation will continue to worsen. To allow everyone in the workforce to have a role to play, the Government, businesses and individuals need to seriously seek out the reasons and come up with countermeasures.

An SME business owner once told me that he would very much like to transform. He has attended courses and even hired consultants, but he ultimately needs an assistant to help in the execution. Taking advantage of the current environment, when SMEs are able to recruit experienced PMETs on board, the boss would have found a capable assistant. Please allow me to use the famous Chinese classic novel "Romance of the Three Kingdoms" as an analogy. Liu Bei was also an "SME" and only managed to recruit Zhuge Liang after three attempts. From then, his "business" developed rapidly and even managed to contend with the "larger corporation" headed by Cao Cao.

As the situation of an ageing population escalates, businesses will face a more severe manpower challenge. I belong to the post-war Baby Boom generation. The total population of this category of more than 900,000 – making up around a quarter of the population – is now moving on to the retirement phase. When this generation of people was younger, it happened to be the time when our country started attracting many MNCs and embarked on rapid economic development. But the MNC-driven economic development is changing.

According to the statistics by the Economic Development Board (EDB), from 2011 to 2015, the fixed asset investment, total business spending and jobs created by foreign companies have been declining. SMEs can take this opportunity to attract more well-educated talents into their companies. SMEs used to provide supporting services to MNCs, but through transformation, they can now grow to become promising Singapore enterprises which can provide a more stable career path to its employees than MNCs. However, SMEs need to create higher-quality job opportunities in order to attract these talents.

SMEs felt disappointed with the publicity on skills upgrading in these two years. For example, the news reports on encouraging skills upgrading that I often read consist of Institute of Technical Education (ITE) students being placed in important roles by MNCs after working hard to upgrade their skills. During the recruitment process, SME owners not only cannot afford to hire graduates, they find it difficult to attract tertiary students and face restrictions on employing foreign talents. Now that even the ITE students are all going to MNCs, who else can they hire?

To my knowledge, many polytechnic and ITE graduates have been entrusted with important roles, assuming major responsibilities in SMEs. We should also widely promote these stories. We should not give SMEs the perception that only MNCs provide career opportunities.

Another publicity that requires adjustment is skills upgrading vis-a-vis pay increments. Upgrading of skills is to correspond with the upgrading of enterprise and the needs of the industry, which, in turn, increases employability. However, this does not naturally equate to pay increments. Some jobs have become obsolete or redundant, thus, employees need to acquire new skills in order to remain employable.

Currently, the manpower issue which I am most concerned about is the Sectoral Manpower Plans (SMPs) which the Government is developing for 25 industries.

EDB, which services MNCs, is leading seven; the other three are hotel, retail and construction. The remaining 10-over industries have yet to be announced.

I would like to understand, in the 10-over sectors, are the needs of SMEs being considered? If yes, I hope the Government can develop training content according to the actual needs of SMEs.

Thus, I would also like to urge the TACs from the various industries to participate in the SMPs proactively to develop more talents for the practical needs of local SMEs through the Government (public), enterprises (private) and TACs model.

Reliance on Foreign Manpower

Assoc Prof Randolph Tan (Nominated Member): Mdm Chair, in his round-up speech, the Finance Minister has succinctly characterised the challenges for our employment landscape as creating the right jobs, equipping workers with the right skills and bringing about the right match. MOM spearheads the complex and demanding role of realising these goals. In recent years, its officers have ramped up the activity on the ground. I thank the Ministry for taking such a difficult but important hands-on approach and I urge it to continue despite criticism from some quarters.

The Ministry's efforts over the last few years have bought us valuable lead time. As the situation on the ground becomes increasingly complex, I would like to ask about its use of analytics to expand its capacity to monitor the labour market situation.

On the one hand, it is clear that some companies are experiencing problems with the restrictions on supply of foreign manpower. On the other hand, there are also reports of over-representation of foreign manpower in certain instances. Although the overall evidence suggests that such problems are not widespread, why are these two extremes occurring at the same time? Are they symptomatic of some deeper flaw in our system? Is our labour market infrastructure up to the task of incorporating the participation of foreign manpower for the longer term?

Is it possible to use data from the Jobs Bank as well as other labour market transactions to examine these problems, to understand if they are problems of matching? In particular, could the Ministry assemble data on hiring experiences to properly understand if there are differences between the jobs matching process for locals and foreigners? Clearly, there are important privacy concerns. Hence, analytics plays a crucial role, because it is possible to build into such an analysis complete anonymity while preserving the broad patterns that are of interest in voluminous transactions data.

The reason why I am raising this is because the pendulum seems to have swung in the other direction. The chorus of voices against foreign manpower is growing louder by the day. Are we sure we are moving in the right direction? Are we sure we are not swinging too far in the opposite direction?

Strengthening the Singapore Core

Ms Jessica Tan Soon Neo (East Coast): Mdm Chairperson, with the current limited workforce growth and productivity trends, how will Singapore continue to develop and strengthen our local workforce and build a strong Singapore core especially for our PME roles? As PME jobs make up more than 50% of the workforce, there will be increasing pressures given the current economic outlook and employment trends to build the depth and the quality of the local workforce for sustainable growth and for Singapore to be able to continue to attract investments.

I welcome initiatives like the Career Support Programme (CSP). As the current employment trends are a result of both cyclical as well as structural changes in the economy, CSP addresses not only wage and employment support but, more importantly, it addresses the critical aspect of training and skills upgrading. It benefits both employer and employee with wage subsidy as well as it allows employers time to assess the competency of the employee while it provides the employee the appropriate support for training and skills upgrading in that one year.

As CSP is now in place for about six months, can MOM share how many employers have participated in CSP? What is the number of mature PMEs that are on the programme and the progress made? Can MOM consider allowing more mature PMEs who have been made redundant to be eligible for CSP by reducing the eligibility period that the PME has been out of work to be less than the current six months?

With the current changes and the impact of technology, the workforce may not be able to keep up, reskill or upskill fast enough. With this, we must recognise that there will be skills gaps. So, while we need companies to build the Singapore Core, we must recognise that businesses do need time to do so. For companies that are committed with a clear plan and commitment to invest in building a Singapore Core, can MOM take a differentiated approach and provide greater support to these organisations? As restructuring and reskilling require time and resources, can MOM allow for transitional manpower adjustments during that period? This will allow the time and access to resources to train and to advance the skills transfer to the local workforce to build a strong Singapore Core.

Mr Chong Kee Hiong (Bishan-Toa Payoh): Mdm Chair, like many of my fellow Members of the House, I strongly believe that we should do more to strengthen our Singaporean Core. Minster Lim Swee Say had described the ideal situation as when local and foreign PMEs do not compete with each other for jobs in Singapore but rather work together to compete for jobs with the rest of the world. We will reach there one day. At this moment, there are still frequent complaints about foreigners doing jobs here that can be performed by Singaporeans. Could the Ministry share how serious the situation is?

What is being done to ensure that EPs complement rather than compete with locals, and what more can we do? Are we going to have stricter EP application conditions and requirements to manage the EP inflow?

Does the Ministry look into how long a particular job has been filled by a foreigner? In cases where it is necessary to hire foreigners, we should ensure that foreign companies execute transfers of skills and expertise to Singaporean employees over time. If a foreigner is replaced by yet another foreigner after a number of years, I would suggest the company be interviewed so that MOM can find out why the transfer of duties to a Singaporean had failed to take place and what can be done to rectify this.

Would the Ministry share with us the success and challenges of the various schemes for retrenched PMETs and the National Jobs Bank? How successful is PCP in helping retrenched PMETs find jobs in growth sectors and is there scope to increase the number of PCPs?

The culture of an organisation, including its hiring practices, is set by the owner or chief executive. The Ministry's senior management should consider having more frequent dialogues and meetings with the owner or chief executive to talk about their hiring practices, starting from the "double weak" and "weak" companies. This will enhance mutual understanding of the employment situation.

For PMEs who are referred to career counselling programme, we should ensure that the counsellors are more senior and possess more experience than the PMEs that come for this programme. They could also take on the role of a mentor, in addition to counselling and career guidance. The counsellors could be senior management or senior officers of the Ministry, industry TACs or volunteers who possess management experience. This could also be a hiring opportunity for these counsellors if they find the PMEs a good match to their organisation's needs.

Presently, job positions paying a fixed monthly salary of $12,000 and above are exempted from the FCF. This should not be the case, as Singaporeans should have the chance to be considered fairly for all jobs, regardless of salary range. I would like to request MOM to review this.

I would also like to ask whether more could be done for non-PMETs. They would need career counselling and time to adjust to new training to help them handle new jobs. Interim financial assistance should be paired with job advisory and placement to help them tide over the difficult time between jobs.

Employers with Strong Singaporean Core

Mr Seah Kian Peng (Marine Parade): I had previously asked the Minister to consider a "carrot" approach to recognise and reward companies that have demonstrated and continue to develop a strong Singaporean Core.

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I offer two possible "carrots". One is to consider giving such employers flexibility to employ foreign staff by considering the employer with wholly-owned subsidiaries in different sectors and consider them as a group in applying the quotas. Another possible "carrot" is to allow companies which employ persons with special needs a higher foreign staff quota. My point is that beyond the cash incentives and support, it is possible to have a nuanced recognition and reward system.

Employment Trends and Job Matching

Ms Jessica Tan Soon Neo: Madam, based on the recent manpower statistics, the unemployment rate for PMETs in Singapore is higher than the average overall unemployment rate. With the tight labour market, while there are still job opportunities, the biggest challenge for PMETs has been gaps in skill or experience to match the available jobs. A higher proportion of PMETs are finding it difficult to secure employment. Employers are facing challenges finding the right resources to hire for jobs that they need to fill.

Apart from efforts of SkillsFuture to help workers gain experience and skills required for available job opportunities, what more can be done to achieve more effective matching of the required skills upgrading and Singaporeans to jobs, especially for mature PMETs? Many employers, especially SMEs, have expressed that they are facing challenges attracting suitable Singaporeans to fill the jobs they are hiring for. Can more be done in this area for job matching programmes for SMEs to tap on to get the right skills and support for job matching?

Can more be shared on the TechSkills Accelerator Programme? It was announced in Budget 2016 that apart from enabling our people to learn new infocomm technology (ICT) skills, it will also be a job placement hub for the ICT sector to enable Singaporeans to seize opportunities in new growth sectors. How will the job matching and placements be done and how can Singaporeans interested in the job opportunities in the ICT sector be able to tap on the programme?

Relevant and Employable Singaporeans

Dr Intan Azura Mokhtar (Ang Mo Kio): At our last Parliament Sitting, we learnt that the ICT sector will have about 30,000 vacancies to be filled. While it is understood that not all of these positions can be filled by Singaporeans, I find it too convenient to ask Singaporeans to accept that we would need foreigners to fill these positions because we do not have enough babies born annually or there are just not enough Singaporeans who join the workforce each year. I believe we can do more.

There are more than enough Singaporeans who are retrenched from their jobs in industries that have been negatively impacted by the slowing domestic market and global economy, or those who have been displaced because of increased mechanisation, "technologisation" and "informatisation" of industries, for instance, those in the marine and process, or manufacturing sectors, and even those in administrative or management positions. Many of them are in their 40s or 50s, while some are in their 60s but who are still keen to be employed.

Once retrenched and displaced, they settle for unskilled or lower-skilled jobs, such as cleaning tables or the streets or taking food orders, and accepting salaries which are a fraction of what they used to earn. Let me state that there is nothing wrong in taking up such jobs, but it is a pity if we were to allow this group of Singaporeans to be underemployed, just like that. They end up in arrears for their monthly bills and financial commitments and developing low self-esteem.

We must help these fellow Singaporeans to reskill, specifically in terms of IT-related skills and other skills needed in growth sectors, such as medical healthcare and technology, gerontology and eldercare, the creative industries and even education and training that also require current IT skills.

I would like to urge the Ministry to work with the Ministry of Communications and Information and the Ministry of Education and with our post-secondary institutions, such as the polytechnics and ITEs, to train, reskill and upskill retrenched or displaced Singaporeans to fill as many vacancies out of the 15,000 that we have been informed about. This is something we must do.

For a start, we can enhance and expand our PCP so that we can prepare Singaporeans for the IT industry and the other growth sectors that I mentioned earlier.

I would also propose that our PCP be extended to help reskill and upskill Singaporeans to join or return to the engineering profession. In a recent job fair in Ang Mo Kio Group Representation Constituency (GRC), I was talking to the HR manager of a local company that specialises in roadworks and construction. The company was looking for project engineers for their roadwork projects. He lamented that it was difficult to employ Singaporeans even though the company offered a salary of $7,000 a month for these project engineers. Well-paying jobs are there for Singaporeans, but there may be a substantial mismatch of skills and experience in order to qualify for such jobs. PCP can help to plug this gap and bring back some engineers who have switched careers.

At this juncture, I would also like to urge the Ministry to look into how eligibility requirements for training programmes, under SkillsFuture or otherwise, can be reviewed to move away from requiring formal educational qualifications as a prerequisite. I would like to urge partner institutions, such as the polytechnics, to consider prior work experience on par with formal educational qualifications, such as the GCE "O" or "N" Levels, so that more mid-career individuals can qualify for courses to upgrade themselves or be certified to embark on a new career.

Yet another group of Singaporeans that serves as a valuable manpower resource is our retirees and stay-at-home mothers (SAHMs). With the current shortage of childcare educarers and caregivers for the elderly, I am sure we can develop and pilot a training programme for our retirees and SAHMs to be trained as babysitters, child minders, educarers or caregivers for the elderly. We should seriously explore this and find effective ways in bringing back to the workforce our retirees and SAHMs.

Issues of Workers' Interests

Ms K Thanaletchimi (Nominated Member): Mdm Chair, under the various SMPs, much has been done to develop job placement and training programmes (Place and Train Programme), including PCPs, under WDA. How many workers have been retrained under these programmes? How can we better support workers in transition across jobs and industries?

I would also like to ask if MOM could provide some form of wage support beyond the training allowance for working people in transition under the Job Placement and Training Programmes to encourage more to move to growth areas in the various industries. More coordination between the Institutes of Higher Learning (IHLs) and the industry to ensure maximum linkage between Pre-Employment Training (PET) and Continuing Education and Training (CET) is important.

Increasingly, it would be a challenge for fresh school leavers to secure a job upon their graduation unless enterprises provide opportunities to these school leavers under the SkillsFuture Earn and Learn Programme. Companies need to change their mental models of seeking experienced workers even though applicants may have the right attitude and passion for the job.

Can I ask the Minister how many places for the SkillsFuture Earn and Learn Programme are available for polytechnic and ITE students in 2016?

I shall now speak about the National Jobs Bank. The National Jobs Bank, introduced in 2014, was created to support FCF and, at the same time, help businesses to connect with the local workforce.

It would be good to know the success rates of Singaporeans who managed to find a job through the National Jobs Bank. Does the Ministry monitor the impact that the National Jobs Bank has brought about in supporting the Singaporean Core objective?

Just like Mr Chong Kee Hiong, if the intent is to ensure Singaporeans are considered and hired for well-paying good jobs, the question arises if it is necessary to exempt jobs that pay more than $12,000 in the portal and if this serves the intended purpose. Perhaps, there needs to be further review to examine the impact of the National Jobs Bank and if it requires further enhancement, such as the 14-day duration of job posting and classification of jobs based on sectors, so that it serves the well-intended purpose of supporting FCF.

I shall now talk about uplifting the professionalism of HR practitioners in SMEs. With evolving economic needs, the HR professionals' role is also evolving to be a demanding one. HR practitioners must, therefore, be on top of their profession to play an effective role, especially those employed in SMEs. Can I ask the Minister if there can be specific mandatory training programmes designed for these HR professionals to update them on current laws and best practices? This is also timely as we will soon be introducing the Employment Claims Tribunal (ECT) to settle disputes.

Following the passing of the Protection from Harassment Bill in Parliament in 2014 to better protect people from harassment and anti-social behaviour, a Tripartite Workgroup on Prevention of Harassment at the Workplace was set up to ensure workplaces are safe for all employees. Coming from the healthcare sector, this issue is close to my heart. Many frontline healthcare workers often have to face the brunt of distressed patients and their families, yet are afraid and reluctant to speak up for fear of retaliation. An organisation cannot function effectively when workers are afraid.

Since the implementation of the Protection from Harassment Bill, I would like to ask the Minister for Manpower how many harassment and workplace bullying cases have been reported. Following the release of the Tripartite Advisory to encourage employers to put in place procedures to manage workplace harassment and develop a harassment prevention policy as part of their risk management process, can more be done to encourage sectors in high risk, for example, public services, to take the lead in fostering a conducive and safe organisational culture?

On workplace safety, the number of fatal incidents has been on the rise. We have extended many efforts in promoting workplace safety and enforcing compliance, especially in the recent year. However, there are employers who are still taking a complacent stand and, as a result, putting the lives of many innocent workers at risk, which also affects their families. What new measures are taken to address the concerns of workplace safety proactively? It has to be a collective concerted effort of all parties in the society. We need to do more to change mindsets, and there is a huge difference between the words "save" and "safe", although both sound almost the same. Some errant employers "save cost" and not provide "safe" workplaces for their workers. We need to identify these irresponsible employers so that potential applicants know who are the errant employers if continuous education and awareness efforts fail to change behaviour and responses.

On hindsight, the Minister can also consider a review of the work-life grant criteria in the interim so that the assistance made available is attractive enough for employers to support flexible work arrangements (FWAs). The sectoral tripartite committee should explore FWAs as an option to attract and retain within their respective industry sector. This could be done by sharing best practices and for progressive companies to assist other companies in this regard. A more concerted effort is needed to make this part of an organisational norm to encourage working people, especially working mothers, to continue to be in the workforce without disruption.

On mandating eldercare or family care leave, we have evolved over the years as a nation to place greater importance on caring for the family, community and society as a whole. As a cohesive nation, we acknowledge that for this to materialise, there needs to be holistic support for families to grow and the elderly to be cared for by their loved ones. For years, the Government has been promoting and encouraging firms to provide for eldercare or family care leave. However, companies have not readily adopted these leave provisions into their systems. The issue of an ageing population has been on the national agenda for some time. But more needs to be done to widen the adoption of elder care leave or family care leave. I would like to ask the Minister if minimal provision for family care leave can be made mandatory.

On supporting mature workers, the last item, during an economic downturn, mature workers in their late 50s most fear losing their jobs. These job losses may be due to cyclical effect or are structural in nature. The Special Employment Credit is definitely a good form of support to ensure the continuous employment of such workers. It would be even more incentivising if companies that employ or retain mature workers 60 years and above could enjoy a rebate for foreign worker levy or pay lower levy. However, it is notable that implementation can be a challenge. With a sectoral approach of reviewing foreign worker quota for each company, perhaps the Ministry can explore this further, if possible.

Future of Manpower in Singapore

Mr Patrick Tay Teck Guan: Mdm Chair, we have a rapidly changing employment landscape with job losses, changing workforce profile with more PMEs, changing work arrangements with more freelance professionals and a sombre economic and market condition.

These scenarios have given rise to several concerns amongst the working population. I am highlighting three areas of concern and offering three suggestions.

The first is the rise in the number of PMEs who are facing workplace disputes and issues. From 1 April 2014 to February this year, the National Trades Union Congress' (NTUC's) U PME Centre saw 1,420 PMEs coming to us for our placement, protection, progression and privileges (4P) services.

Of the total, about 500 were on workplace issues.

I am aware MOM has started public consultation on the proposed ECT. On this note, I am asking, with the setting up of the ECT, how can MOM ensure that the sanctity of tripartism is preserved and that the role of unions in grievance handling, advisory, providing representation for our members are not diluted?

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I therefore, suggest and submit that the Tripartite Mediation Framework provided under the Industrial Relations Act, which avails union members to resolve three heads of claim, must also consequently have its rules amended and have even greater, wider, deeper ambit, scope and jurisdiction than the ECT which avails all, including PMEs, and with no salary cap.

Can there also be a one-stop facility similar to our U PME Centre, or can we use our existing U PME Centre as a front-facing one-stop facility for all PMEs when they require workplace advice or consultation on workplace issues?

Second, recently, I had an encounter with a unionised company which is in trouble and had been trying to obtain a scheme of arrangement but failed and now applying to Court for judicial management. It is provided in law that a moratorium is imposed when a company files for insolvency proceedings. This means no proceedings can be taken against that company, unless with the leave of Court.

My concern and frustration are with the plight of the workers there. What is horrifying is that the workers have been left unpaid their monthly wages since late last year when the insolvency proceedings started. They are hanging on to the company hoping that some form of retrenchment benefit can be paid to them or that there are monies to be obtained when the company winds up after a proof of debt is filed.

In reality, there are many other secured creditors and the workers may well be unlikely to obtain any retrenchment benefit as the union is unable to take the company to the Industrial Arbitration Court to obtain an order for retrenchment benefits. There may also not be any monies left for distribution via section 328 of the Companies Act after the company winds up. In any case, the maximum amount they can get is $12,500 under section 328.

Such is the plight of the workers. They will also get nothing if they leave their jobs now. Many have been with the company for years. I am told their Central Provident Fund (CPF) contributions are also unpaid for this year and partially for those months late last year. The workers feel helpless. The union has also engaged legal counsel but there is still nothing which can be done. Is there really nothing which the authorities can do against the company or help the workers?

There are about 100 workers still there and many have already left. In many ways, this is a case where the law provides no recourse for these aggrieved workers who may work for months for free and not paid. I am not sure how long this case will drag on and the end is definitely not soon.

Besides some of the financial assistance schemes by unions and the community, can there be specific legislative provisions or regulations in place or exceptions made to help these workers who are left in the lurch?

By the same token, I know of another company which is planning to wind up later this year and has started to prepare for it. Yet, when asked to negotiate for an agreement on retrenchment payouts, it is simply dragging its feet and waiting for the time to come so that they need not pay a single cent.

Can the laws be amended such that for disputes on wages and retrenchment benefits, the case can be allowed to proceed for an Industrial Arbitration Court hearing during the period of "moratorium" so as to obtain a judgment or order before the company actually folds.

The third area, unlike traditional contract of service where there is an employer-employee relationship and labour legislation providing protection, there are currently no laws or regulations to help the growing group of freelance professionals in Singapore who are in a contract for service situation.

Even the Trade Unions Act prohibit NTUC and our unions to represent them or formally organise them except through the formation of associations which are not unions per se and not vested with powers provided in the Industrial Relations Act.

The number of freelance professionals in Singapore as of June last year stands at 170,000. Not a small group and I expect it to grow with the advent of the sharing economy and the nature of work, workforce, workplaces and work relationships.

I have had many engagements with freelance professionals via our PME Unit's events. Their top three complaints are late payment or non-payment, no provision of outpatient medical privileges and work injury compensation coverage. The problem we face is that nowhere in the world are there specific laws protecting freelancers and that many freelancers are unable to even band together to form an association. They are not allowed to be represented by unions and their only recourse is to the Small Claims Tribunal with a jurisdictional cap.

NTUC has been trying to assist these freelance professionals and we have started a freelance and self-employed unit and the U-Associate programme. Since 2013, NTUC, in partnership with the Law Society, has started legal clinics, conducted legal primers and even did up a pocket series booklet for them, such as this, to equip them with an understanding of their rights, privileges and responsibilities in partnership.

I submit that we should do a serious study on what we can do for them through a dedicated piece of legislation like a recent Bill that was tabled in California to protect freelancers, especially when the sharing economy and crowdsourcing are happening.

The Chairman: Minister Lim Swee Say.

The Minister for Manpower (Mr Lim Swee Say): Mdm Chair, with your permission, I have asked the Clerks to place an infographic, MOM Committee of Supply (COS) in brief, on the Members' seats during the tea break.

I thank Members who have shared their insights and questions on the labour market in Singapore. I would like to take some of the points now and I will take the rest in my second speech.

Minister Heng Swee Keat said in his round-up speech that Budget 2016 is but "one step in a long journey". From the manpower angle, this is not a walking step but a running step. In fact, more like a jumping step.

Since coming to MOM just about a year ago, I have been asked many questions on our labour policies. Employers looking for workers say they cannot find local workers. They ask: can MOM relax on foreign workers, up the quota, down the levy and be more pro-business? Workers looking for jobs, especially those looking for PMET jobs, say they cannot get the jobs that they want or the promotion they feel they deserve, so they ask: can MOM be more pro-worker? Why not "Singaporean first", why not "Singaporean Only"?

In the past five years from 2010 to 2015, employment rates for ages 25 to 64 have gone up to 80.5%, among the highest in the world. The unemployment rate, at less than 2% overall and less than 3% for locals, is among the lowest in the world. Income growth was broad-based. Real wage went up by 3% in real terms a year, not just the median wage but the bottom 20^th percentile in Singapore. The profile of jobs has continued to improve. Local PMET employment now accounts for 54% of our total local employment. So, these are good employment outcomes for our workers and our people.

The next five years will be much more challenging. We are going to see a drop in the growth of the labour force, a sharp and structural drop. The growth in our local labour force will drop by more than half from an average of 55,000 a year in the past five years to just about 20,000 a year for next five years. So, a drop of more than half.

Likewise, the growth in our foreign workforce will drop, too, also by more than half, from an average of 55,000 per year in past five years to just 20,000 to 25,000 a year in the next five years. So, put together, growth of the Singapore workforce will continue to drop from 4% a year in 2011 to 2014, to 2% last year and likely to be around 1% by the year 2020.

This has a great impact on the future employment landscape in Singapore. The days of more than 100,000 job growth a year are over. It is simply not sustainable. With no gain in productivity, we have moved from a 4+0=4 or 4% growth in the Singapore workforce plus 0% growth in productivity to give us a 4% gross domestic product (GDP) growth during the year 2011 to 2014 on average.

Last year, it dropped to 2+0=2 or 2% workforce growth, 0% growth in productivity to give us a 2% growth in our GDP.

The question is: what will happen next? From 4+0=4 to 2+0=2, what is going to happen next? Will employment outcomes in the next five years be better or worse? I can see, I can think of three possible scenarios – the Good, the Bad and, of course, the Ugly.

The first scenario, we are unable to transform fast enough; continue with zero productivity growth; continue with manpower-led growth of more than 100,000 jobs a year. MOM will have no choice, we do a U-turn, relax on our foreign manpower and that is what many employers are asking for.

From 4+0 to 2+0, we now go back to 3+0. We have to let in more foreign workers to make up for the slower growth in local manpower. With 3+0=3, yes, we have 3% GDP growth. But what happens to our local to -foreign worker ratio? It will continue to drop from the two is to one today, maybe to one is to one, one day and, beyond that, Singaporean workers will become a minority in our local workforce. The Singaporean Core will be weakened further and, in fact, the local-foreign divide will deepen further. That is why I call it the "Ugly" scenario.

The second scenario, to avoid this ugly outcome, MOM can stand firm, no U-turn in our foreign manpower policy, continue to moderate the intake of foreign manpower. But without breakthrough in productivity growth, we will move from 4+0 to 2+0 to eventually 1+0=1. So, in other words, low growth will become the new norm, in fact, hovering around stagnation. If that happens, it is a matter of time that unemployment in Singapore will go up and wage growth will stop, and I call this a "Bad" scenario for all.

The third scenario is for us to recognise that technology is changing the nature of jobs and global competition is changing the nature of investment. Instead of manpower-led growth, 100,000 new jobs a year, we go for manpower-lean growth. We speed up transformation, instead of going for larger quantity of jobs growth, we go for better quality of job growth.

Step by step, sector by sector, we move from high value-added to value creation. From value creation to value multiplication; and then we can return to positive productivity growth again. Instead of going from 4+0, 2+0 to either 3+0 which is an ugly outcome, or 1+0 which is a bad outcome, we should strive for 1+2, 1% growth in our workforce plus 2% growth in our productivity to give us 3% growth. So, 1+2=3 is the good outcome that we must strive for.

The challenge for us is how to make it happen. Along the way, if we are more pro-business and less pro-worker, we could end up with a strong economy but a weak Singaporean Core. If we are more pro-worker and less pro-business, we can have a strong Singaporean Core but a weak economy. Neither is good because growth cannot be sustained, eventually we will go downhill.

The only way to succeed is for us to become more pro-business and more pro-worker both at the same time, so that, hopefully, we have a Manpower-Lean and more Productive economy with a strong Singaporean Core.

This is why MOM will focus our labour policies along three main thrusts: first, to support industry transformation to become more manpower-lean and more productive; second, to build a strong Singaporean Core; and third, to strengthen the global competitiveness of the Singapore Workforce, comprising both local and foreign manpower.

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First, to be a more manpower-lean economy and more productive economy. This is of great concern to MOM because if we fail to become a more manpower-lean economy, manpower will become the bottleneck in our future growth. Hence, Industry Transformation Maps are so important for us to visualise the industry of the future, to make better use of technology, manpower, innovation to break the bottlenecks of small size, limited resources, especially manpower limitation.

To forge a new mindset of lean transformation, lean innovation, from lean manufacturing to lean services, from lean industry to lean enterprise. Mr Lee Yi Shyan and Mr Thomas Chua will be pleased to know that we are giving special attention and support to SMEs. SMEs employ about two-thirds of our workforce, so the Singapore economy cannot become more manpower-lean, cannot become more productive and innovative, if our SMEs are not.

Hence, MOM, together with our other agencies under the Ministry of Trade and Industry (MTI) family, launched the Lean Enterprise Development Scheme (LEDS) last year to help SMEs to develop their capabilities, manpower and market, including international market. And with the newly announced Automation Support scheme, in addition to capability, manpower and market development, we can now add on one more pillar, which is, capacity expansion. Therefore, we are very determined to speed up LEDS during this slowdown.

My commitment to SMEs is that those with solid plans, real action to be more manpower-lean and productive, you can be assured of our best support, not just from MOM, but all the other agencies under LEDS. In fact, MOM will also provide transitional flexibility in foreign worker support. This was the point brought up by Mr Lee Yi Shyan. Later, my colleague, Minister of State Teo Ser Luck, will share more on LEDS.

Our second thrust is to build a strong Singaporean Core. Every Industry Transformation Map will be accompanied by an SMP formulated by the Sectoral Tripartite Committee. This will address the concern of Mr Lee Yi Shyan on whether MOM will be involved in co-driving the development of the Industry Transformation Plan.

In fact, we will be coordinating our efforts through the SMPs. Ms Jessica Tan expressed her concern about whether we can minimise this mismatch between skill and job. With SMP, we will be able to look ahead and identify what type of jobs will be created, what kind of skills need to be developed for the future, so that we can support the growth of this transformed industry of the future. In this way, it also helps our people to upgrade, reskill and, along the way, we aim to build a strong Singaporean Core in all major sectors of the economy, as we continue to transform these industries.

The hotel sector is one good example. It is not a sexy sector, but it is an important sector, alongside many other sectors. We are going to see a 20% increase in hotel rooms in Singapore by the year 2020. Those in the hotel industry are fully aware that it is not possible for them to grow the workforce in the hotel sector by 20% because of this keener competition for manpower as we slow down the growth of the workforce.

Under the SMP for the hotel sector, we have three priorities. Firstly, how to become more manpower-lean? The industries are working very hard to reduce the staff-to-room manning ratio, so that as the room number goes up, you do not have to increase the number of workers at the same proportion. Secondly, how to strengthen the Singaporean Core? How to attract, develop, retain and improve the quality of locals working in this sector? And last but not least, the service transformation into hotels of the future, so that we can remain globally competitive.

In support of this direction by the industry, through the SMP, the NTUC e2i, Singapore Tourism Board, WDA, unions and the industry associations, we are working very closely together to attract ITE, polytechnic and degree holders under the executive development programme for the hotel sector for them to join the hospitality, F&B and retail sectors. This was the point brought up Mr Lee Yi Shyan.

First, help them to learn supervisory skills, put them through 12 to 18 months of on-the-job training (OJT), so that they can become duty manager, assistant manager and, from there, develop their career. We are also facilitating the mid-career PMETs through professional conversion.

At the same time, we are helping them to become more lean and more productive. For example, rank-and-file workers in the hotel sector are now undergoing this process of multi-skilling, so that each person can perform more than one task, thereby optimising the deployment of manpower and, along the way, help them to enhance their wages. Another example would be through the use of radio frequency identification (RFID) to strengthen the process of automation.

In fact, the Singapore Tourism Board and WDA are now working together with the hotel industry to formulate an initiative to be known as the Lean Hotel Initiative. In short, make it a movement in our hotel sector, so that the jobs of the future in this hotel sector will become attractive, so that the Singaporean Core will be stronger.

Dr Intan Mokhtar asked about the ICT sector. We will adopt the same line. The ICT sector, under the leadership of the Infocomm Development Authority (IDA), is formulating the SMP. All the areas of opportunities will be identified and we will step up efforts to channel more Singaporeans into this sector.

As we speed up industry transformation, redundancy will go up, as seen in recent years. Most are able to find jobs, hence, our low unemployment today. Yet, we are still concerned because we are seeing, among the workers made redundant, there are more mature workers; there are more PMETs, and, in fact, they also need more time to find jobs, especially the mature PMETs.

Besides helping to strengthen the Singaporean Core at the sector level, sector by sector, like what we did for the hotel sector, we must also do more to support Singaporean workers at the individual level.

We share the concerns of Assoc Prof Muhd Faishal Ibrahim, Mr Chong Kee Hiong, Ms Jessica Tan and others, and we will do more to support them. The "Adapt and Grow" initiative will provide enhanced employment support to help Singaporeans, especially the mature PMETs and those affected by redundancy.

We launched CSP in October last year to encourage employment of mid-career PMETs, especially those who are long-term unemployed, who have been out of a job for more than six months. Under CSP, to encourage the employers to hire these mid-career PMETs and at the same time pay them decent wages of at least S$4,000, we offer a wage support of 10% to 40% for the first year of employment. A mid-career PMET who has been out of job for six months, can come under the CSP. We will help them to find employers. For the first year of his employment, under the CSP, we will subsidise wages of up to S$12,600 for that year for those older than 40. For those who are more than 50, it would be up to S$25,200 for that first year.

In the last five months, we managed to reach out to 200 mature PMETs who have been out of job for more than six months. So far, about half of them have successfully secured employment and most are with SMEs. Mr Thomas Chua may be happy to hear this.

We have very positive feedback from both employers and employees because, for the employees, they suffer a smaller cut in wages, given the wage support; for the employers, they have to bear lower wage cost, given the subsidies.

One example is Mr Kuan Mun Fai, 52 years old. He was a Business Development Director with an MNC for 23 years. He left the company. For seven months, he could not find a job that is suitable for him. He came under the CSP when it was launched in October. At that time, he was feeling unsure whether he would be able to get a job that he was looking for. But today, he is a different person, confident and positive. Under the CSP, within one month, we helped him to find a good job with a local distributor of industrial lighting products to develop markets in the Association of Southeast Asian Nations (ASEAN) and East Asia. Yes, he did accept a pay cut to join this company, but he is prepared to work his way up with this new employer. I wish him well.

To help more PMETs, we have decided to extend CSP to two more groups of people beyond those who are mature and long-term unemployed.

For PMETs made redundant and have difficulty finding jobs, meaning six months or more, we will waive the age requirement of 40. In other words, even the younger PMETs, having been made redundant, if they have difficulty finding jobs for more than six months, they can come under the CSP.

The other group will be for the matured PMETs made redundant. We will waive the requirement on the six-month lead time. In other words, the moment they are retrenched, for those above 40 years old, they can apply to join CSP straight away without having to wait for six months.

Under the CSP, we are unable to promise same job, same pay. What we promise is our full support to help them find jobs as quickly as possible to start again at mid-career with a salary of at least $4,000, so that they can grow again from there.

We are also helping more PMETs to switch careers. A lifelong career with the same company or even the same industry has become less likely for many people. Mid-career PMETs may have to make a career change due to redundancy or other personal reasons.

That is the reason why we launched PCP in 2007, where we provide training and wage support up to 70% for the entire duration of training, which is typically about two years or less.

Currently, there are 10 sectors under PCP. Since the launch in 2007, over 7,000 PMETs have benefited from this scheme. One of them is Chong Kim Seng, 49 years old. He was not retrenched, but he decided to make a career switch from electronics to biologics. Why? Because Mr Chong looked at biologics as an emerging sector with tremendous potential. There is a rising demand for medicines in Asian markets. There is a good career progression path, where there is a headquarters operation, manufacturing or R&D in this sector. He read in the public media that EDB has built up a healthy pipeline. There are new plants as well as plant expansions over the next five years.

In other words, this sector is going to grow in the next five years. There will be more jobs, there will more opportunities. As a result, Mr Chong took a pay cut willingly. As I said, he was not retrenched, but he decided to take a pay cut to move from electronics to biologics. He has to take a pay cut because he did not have any prior experience relevant to the sector. He was supported under PCP. He received a Workforce Skills Qualification (WSQ) Higher Certification in Process Technology and is now working as a Senior Quality Assurance specialist. In fact, with his maturity and adaptability, I am very sure that he will find biologics a good career and one that will be good for him for the next 10-15 years and beyond.

Dr Intan Mokhtar and Ms Thanaletchimi will be pleased to know that we are stepping up our efforts in the existing 10 PCP sectors. Healthcare is one example. I think Ms Thanaletchimi will be very interested in this area. In the last three years, on average, each year, we have attracted about 370 PMETs to join the PCP for the healthcare sector. This year, working together with MOH, we jointly launched added programmes for diagnostic radiographers, occupational therapists and physiotherapists.

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As result, we see a 60% increase in response rates. This year, we have about 600 PMETs applying to go through professional conversion, up from the 370 per year in the last three years. We are doing the same for other sectors, such as media and design, going into areas like game writing and advertising.

We are also going to extend the PCP to more sectors, especially those sectors that are still hiring and growing, for example, chemicals and pharmaceuticals, logistics and retail. In addition to that, we also recognise that some PMETs may not be switching careers from one sector to another, but they want to switch careers within the same sector, but different areas of specialisation within the same sector. I think the point was brought up by Dr Intan Mokhtar.

Like in the case for ICT, there are now specialisations in areas of growing demand, such as cybersecurity, network administration, software development and other emerging jobs under the Smart Nation initiatives.

I am happy to say that, henceforth, PCP will now support intra-sectoral conversions, as well as inter-company conversions. If Company A is downsizing, retrenching workers, Company B could be growing and expanding. We will support Company B to take over retrenched workers from Company A and help them go through the professional conversion, even at the company level.

Another way to help mid-career PMETs is to match more of their expertise to the SMEs. This was the point brought up by Mr Thomas Chua. As mentioned by Mr Chua, many SMEs are growing and still hiring, but are looking for PMETs with experience and expertise. I was told that three areas of expertise are very popular and are in great demand by SMEs – business development; marketing and sales; and operational management. They are looking for these types of people.

On the other hand, we also hear many mid-career PMETs say that they are not familiar with career opportunities with SMEs. We launched P-Max just a year ago, to try out whether there is scope for us to connect the mid-career PMETs with the experience and expertise of interest to the SMEs, to connect them better. I am happy to say that in the last one year, we have so far matched over 800 mid-career PMETs with about 800 SMEs.

Evelyn Ng is one of them. She has 25 years of experience in operations, HR and administration with MNCs. She stopped work for one year to look after her mother. Under P-Max, we matched her expertise to an SME. She is now the HR and Administration Manager in an SME. She is not alone; there are more than 800 of them under this programme.

We are going to expand P-Max through more partners and more TACs. Our aim is to place more than 1,000 mid-career PMETs under this programme every year.

The schemes, that is, CSP, PCP, P-Max that I have covered so far, are targeted at the PMETs. As brought up by Mr Chong Kee Hiong, we should not neglect the rank-and-file workers as well. And we have not. The rank-and-file jobseekers will, likewise, get more help under our Adapt and Grow programme.

We have a very successful Place-and-Train programme at NTUC e2i. Under this programme, we provide 70% salary support of up to $2,000 per month and a training subsidy of up to 90%. Typically, these trainings would last three to six months.

Last year, e2i, under the Place-and-Train programme, has placed 1,200 rank-and-file workers. Soon, more sectors and programmes will be introduced this year. We want to expand the outreach of this Place- and-Train programme. For example, in the hotel sector, they are looking for Guest Services Officers. So, we will put it under this programme.

In the infocomm media area, they are looking for communications and network associates, cybersecurity rank-and-file at the National ITE Certificate (NITEC) level. We will include that under this Place-and-Train programme. In addition to Place-and-Train, e2i and the career centres of WDA, also conduct career guidance, the one that Minister Ong Ye Kung mentioned earlier. We provide career guidance and, every year, we conduct more than 200 job fairs to introduce more than 20,000 jobs to our jobseekers. Last year, we helped to place 11,000 rank-and-file workers.

Mohd Fadzli, 30 years old, is one of them. He was working as a cleaner, earning $1,500. He approached WDA Career Centre for career advice and guidance, so we guided him to move into the areas of Workplace Safety and Health (WSH). He went on to receive a WSQ Certificate in WSH, followed by a WSQ Advanced Certificate in WSH. Today, he is working as a Safety Coordinator earning $2,200, a big increase from $1,500.

In some cases, when we try to match the rank-and-file workers to the jobs, both sides are unsure about each other. The jobseekers are unsure about the job, and the employer is unsure about the worker. What do we do? We say, "Never mind. Go on a work trial". For 80 hours, WDA will pay a token allowance to the person. In other words, the employer does not have to pay anything. They work together for 80 hours just to try it out. It is for the workers to try out the job, and for the employer to try out the worker.

One example is Foo Lai Leng, 57 years old. She returned to work after 10 years, due to family commitments. She wanted to try out the early childhood sector, but she was not sure if this sector was suitable for her. We put her under Work Trial. After 80 hours, she decided that, yes, this is a career that she is interested in. And yes, the companies in this sector also found her suitable. Today, she is working full-time as an Assistant Teacher. She is now going for a Diploma in Early Childhood Education as her next target.

We intend to help more and more jobseekers, for those who are unsure about what to do under this Work Trial programme. WDA will up allowance from $360 to $600 for the 80 hours. At the same time, we will raised our retention incentive, meaning that after the 80 hours, if you decide to settle down with your job, we will give them an incentive of $500.

On the whole, for both rank-and-file workers and PMETs, we are stepping up efforts in employment facilitation for them. E2i, WDA, together with our partners, we have helped over 6,000 PMETs and 11,000 rank-and-file workers a year to get jobs

With enhanced coverage and support under the Adapt and Grow initiative, we are committed to help even more PMETs and rank-and-file workers. So, besides workshops, seminars, recruitment events, job fairs, we are going to introduce e-services. For example, e2i is now trying out this concept of virtual job fairs. This is a job fair but it does not happen in the real world; it is in the virtual world. They help the jobseekers to submit not resumes, but "visume".

I asked them what is the difference between resumes and "visumes". They say "visumes" stands for video resumes. What it means is that the e2i will help the jobseeker to do a video recording of how the person will describe himself, present his resume in a video form and they will send this video to the prospective employer. The prospective employer will look at it over the virtual world, on the Internet. Apparently, the response has been quite positive, so e2i intends to do more.

WDA, likewise, is going to introduce more e-career services, such as online matching, as well as online forum communities. We will also improve our information support for both employers and the jobseekers. The National Jobs Bank does contain a lot of useful information, I think the point brought up by Assoc Prof Randolph Tan. Our challenge is how to do more data analytics to make that information more useful, more user-friendly, and enable jobseekers and employers to do more self-help, so that they can navigate the information themselves.

We are now studying the "best-in-class" job portals in other countries. We intend to collaborate with leading-edge partners to improve the interface to make it more useful for both the jobseekers, as well as the employers, and we hope to see improvements progressively over the next 12 months.

Lastly, another area we will strengthen is our partnership with the employment agency (EA) industry. This was a point brought up by Mr Patrick Tay. We are going to work with them closer to understand the current placement practices and to see how we can work with them, encourage or regulate the industry in such a way that they will step up and pay more attention to the placement of local PMETs. We are going to partner the "best-in-class" placement companies, for example, those with industry specialisation or those who are jobseeker-centric.

Many EAs are employer-centric, rather than jobseeker-centric. We are looking for a new model where the EAs have the incentive to become more jobseeker-centric. At the same time, we are looking for those with a strong network of employers because then, they will know where the job opportunities are.

In short, our second thrust is to strengthen the Singaporean Core. First, sector by sector, through the SMPs to channel as many Singaporeans as we can into those respective sectors, to ensure that we have a strong Singapore Core in all the major sectors as we transform them.

Second, enterprise by enterprise, individual by individual, through these career and employment support programmes that I described earlier.

We will do our very best to help out jobseekers, but we need our jobseekers to do their very best to help themselves too. To my fellow Singaporeans, who are affected by redundancy, my concern for them is that the longer they are out of employment, the harder it will be for them to get back into employment. Therefore, our priority is to help them to get back to work quickly.

We are unable to promise no pay cut or a guarantee of job offers, but what we do promise is our best efforts to help, with a variety of options and the diversity of opportunities. We need them to do their best to help themselves. Be prepared to adapt to different jobs, if necessary, in different sectors and even different pay, so that they can grow again.

Mdm Chair, our third and final thrust is to strengthen the global competitiveness of our Singapore Workforce. The Singapore Workforce today is made up of two-third locals and one-third foreign manpower. As I had mentioned earlier, some have asked me, why not "Singaporean only", stop them from coming in and why not "Singaporean first"? They say, "Only when no Singaporean can do the job or want to do the job, then we allow them to come in".

I recall during my days with EDB, we walked the streets, we knocked on doors, we made cold calls, we made hot calls, we have tough calls, we have friendly calls. Call after call. Why? Because quality investments are very hard to come by. Competition is global. The better the investment, the stronger the competition, the stronger the competitors, the higher the demand of the investors. The toughest demand of all, for Singapore to meet, is not land or water, but manpower.

One good illustration is wafer fabrication plants. We chased after wafer fabrication plants because we knew that consumer electronics, after a while, low value-added will be phased out. We knew that, one day, the disk drives sector will go through major restructuring. We needed to find a new growth sector.

Twenty years ago, we identified wafer fabrication industry as the next growth industry. Each plant costs about US$1 billion to build. Each plant is water-intensive and uses one million gallons of water every day. But fortunately, we have NEWater. So, today, they are all supplied with NEWater. But most importantly, each plant will need 1,000 workers – 500 PMETs and 500 production specialists. Our local manpower is good, but we do not have enough, in terms of the range of expertise, experience and, most of all, the number. We just do not have the number.

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As a result, we worked with these investors to borrow PMETs, to borrow workers from around the world, bring them into Singapore so that we can bridge three manpower gaps that we face − the number gap, the capability gap and the timing gap. And I must say that this manpower strategy has worked very well for us.

Today, we have 13 wafer fabrication plants employing 8,000 PMETs and 8,000 operators. And of the 8,000 PMETs, 76% 6,000 of them, are our local engineers, local PMETs. Yes, we have 2,000 foreign PMETs in these plants but, together with them, these 2,000 foreign PMETs, we are able to create jobs for 6,000 local PMETs.

Looking back, if we had insisted on Singaporean Only, Singaporean First, I think these plants and many other good investments and good jobs would not be here today.

So, having foreign manpower in our Singapore workforce is a plus for us, not because Singaporeans are not good but because we simply do not have enough in the number, readiness and diversity of capabilities to meet the needs of the global investors and to beat the offers of the other global competitors.

As we transform and grow into the future, we need to compete for even more, even better investments and we will have to face even bigger, even stronger competitors. The demands from investors will only get higher, especially on manpower. We stand a better chance of beating the competition, winning good investments and jobs if our local and foreign manpower here work together as one Singapore workforce − two-thirds plus one-third, as one Singapore workforce; rather than as two competing workforces − two-thirds versus one-third. Because remember, two-thirds versus one-third will always be less than one. At the end of the day, we must recognise that the real competition is out there globally, not in here locally.

Today, at the national level, foreigners account for 21% of jobs within the EP salary range, which is currently $3,300. So, in other words, of all the jobs in Singapore today that pay more than $3,300, foreigners account for 21%, and locals 79%.

By sector, the foreigner share varies, of course, across industries. The highest is 37% in infocomm and F&B. So, these two sectors have the highest 37%, 38%. All other sectors, all other industries, the ratio of foreign to local counterparts is less than one is to two, less than one-third. All the other sectors, less than one-third. We must also bear in mind that the growth of EPs has also slowed down, from 32,000 in 2011 to 9,000 last year. So, from 32,000, it has dropped to 9,000.

Even though the overall ratio, both at the national and industry levels, shows that foreigners are a minority, just one-fifth at the national level and, with the exception of the two, infocomm and F&B, they are all less than one-third. Yet, there is a perception among some Singaporeans that "Why am I a minority in my workplace, working here in Singapore? Why?" I think the answer is because of what I call the pockets of "EP concentration" in some companies, in some segments of the industry and at some locations. This is highly undesirable.

These pockets of "EP concentration" have led to the perception of a liberal intake of EPs, which is not the case, or accusations of unfair consideration for locals or discrimination against our local PMETs. I am also concerned that some of these employers may have violated the "Employment of Foreign Manpower Regulations", which require companies to take, and let me quote: "…reasonable efforts to provide fair employment opportunities to citizens of Singapore, including efforts to attract and consider such citizens for employment or to train them and develop their careers and potential in the workplace". We will, therefore, refine the processing of work pass applications for EPs. Currently, in processing EP applications, we assess only the individual-related criteria, that is, their qualification, experience and salary.

Going forward, we will also be looking at three additional factors that are "company-related". So, not just individual-related criteria but also company-related. And the assessment will be carried out by Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP).

The first assessment: how strong is the Singaporean Core in this company today? The majority of the companies, as I mentioned earlier, in the same industry, have a healthy Singaporean Core. But there are outliers, significantly weaker than the industry norms.

The second assessment: with a weak Singaporean Core today, do they have any firm commitment to nurture and strengthen the Singaporean Core for the future?

Thirdly, and finally, in consultation with relevant economic agencies, we will assess how relevant these "double weak" companies − that is, with weak in Singaporean Core and weak in commitment to nurture Singaporean Core – are to our economy and society. If they are not here, how much will we be affected? And if the answer is not much, then they are what we call the "triple weak" companies − weak in Singaporean Core, weak in commitment and, at the same time, weak in economic linkage and social impact.

Mr Patrick Tay has shared his concerns regarding these "triple weak" companies, which are our target for closer scrutiny. At TAFEP's recommendation, they will be placed on our "watchlist", not because we are anti-foreigner but because their behaviour has added to the deepening of the "local-foreign" divide in our Singapore workforce. If left unchecked, the sentiment of two-thirds versus one-third will continue to grow. It will weaken the unity, cohesion and, eventually, the overall competitiveness of Singapore.

TAFEP has already served notice on about 100 companies. These are the outliers in various sectors with a weak Singaporean Core, which is much weaker than the industry norm and all of them have a majority EP share of more than 50% and they display a weak commitment to recruit or develop local PMETs. TAFEP is engaging them to improve their HR practices and will do a company-by-company review in six months. So far, these firms have been broadly cooperative. Some of them have acknowledged that there is room to strengthen the Singaporean Core, some have approached e2i/WDA to source for local PMETs through programmes, such as CSP and PCP, that I talked about. Some have engaged external help to review their internal HR process.

For those "triple weak" companies with no progress made, at the recommendation of TAFEP, their work pass privileges can be suspended. Renewal of existing EPs, processing of new EP applications will be affected. Curtailment of work pass privilege will have serious consequences on their continued operations and growth in Singapore. So, we hope they will take corrective actions − move out of the "triple weak" list, do not just grow their business here but treat Singaporeans fairly, too, and help build a stronger Singaporean Core in their companies and industries.

And I want to assure the vast majority of companies out there that they are not "triple weak" and, hence, will not be affected by this move. MOM will continue to serve them as per the current practice. There is nothing to fear as long as they continue to treat our local PMETs fairly.

As we take firm action against the "triple weak" companies, we will also take proactive action to recognise and partner those who are "triple strong" − strong in Singaporean Core, strong in commitment to nurture the Singaporean Core and strong in economic linkage or social impact, especially in sectors that are crucial to our future growth − Smart Nation, advanced manufacturing, future services and more.

I am very encouraged and impressed by the few companies that I have visited so far. They believe in the development of human capital. Yes, they tap on foreign PMETs to complement and strengthen their overall team and, yet, at the same time, they pay tremendous attention to value and nurture our local talents by transferring capability to them, giving them exposure and nurturing them for higher responsibility locally, regionally and globally. So, in other words, instead of a mindset of two-thirds versus one-third, they embraced the mindset of two-thirds plus one-third. And for some of them, two-thirds plus one-third can actually be bigger than one.

To help strengthen the positive mindset of two-thirds plus one-third, we are going to grow this "triple strong" community. MOM will launch a Human Capital Partnership (HCP) programme later this year. We are going to help them tap on SkillsFuture to strengthen the Singaporean Core at all levels in these "triple strong" companies: Earn and Learn at entry level; Mid-Career Enhancement; Leadership Development; and to provide greater facilitation for them to bring in foreign talents with the expertise to strengthen and transfer capability to our local PMETs. We can study some of the suggestions made by Mr Seah Kian Peng.

One flagship initiative under the HCP is to nurture promising local talents into regional talents, into potential global talents and, tentatively, I intend to call this programme the "Glocal" Talent Development Programme. "Glocal" Talent. G-L-O-C-A-L. Now, through this combination of efforts, countering the "triple weak", partnering the "triple strong", we want to send a clear signal and strong message that whether you are local or foreigner, whether employer or employee, whether you are union or management, we all have a role to play to work together to strengthen the Singapore workforce to compete for the best investments and jobs to Singapore for all to share.

Mdm Chair, if I may speak in Mandarin.

(In Mandarin):[Please refer to Vernacular Speech.] During recent conversations with SME bosses, I asked them for their views on the current economic situation. They said the market is very quiet. Then I asked about their plans, and they said that since the outlook is uncertain, it is better to stay put. Their view is that, if they do nothing, they will not make mistakes, so they will ride this out first and make plans later.

I am not a businessman, but through my interactions with business leaders in the past years, I have learnt a few things that are worth pondering over.

The world is ever-changing. It changes regardless of whether times are good or bad. The difference is, when times are bad, changes are greater and they come faster.

The market may be quiet, but this is only what we see on the surface. In reality, the market is undergoing swift changes. This is why, while it is quiet, it is the time to make changes. Only through drastic changes and transformation, with a new look and new attitude, and by preparing well, can we face the future in a better shape.

Changes or transformations are often easier said than done, especially for SMEs. This is understandable, which is why I launched LEDS to consolidate all the schemes from various Government agencies, to provide a one-stop service to help SMEs transform. We will work on three areas to help companies develop capabilities, promote manpower development and explore new markets. With the addition of the Automation Support Package, we can speed up the transformation of today, to flourish and grow tomorrow.

During this transition period, SMEs may require some room for flexibility in hiring foreign workers, and the LEDS programme has taken this into consideration. In other words, so long as the enterprise has a clear and solid plan for transformation and is determined to persevere, MOM and various Government agencies will definitely give their full support and cooperation.

I hope SMEs can make good use of the LEDS programme to make big changes during the economic slowdown and not miss this good opportunity. With the changes taking place in the labour market, the business model of old is no longer relevant to the future economy.

"After endless mountains and rivers that leave doubt whether there is a path out, suddenly one encounters the shade of a willow, bright flowers and a lovely village." Every cloud will have a silver lining.

If you run, I will run together with you; if you dash, I will dash together with you. Our future can be bright. If more SMEs run together, the impetus will be stronger and the drive will be bigger. We can push and nudge one another and run towards this bright future.

Singapore is not just an economy but a nation. Of course, we need to give our best to strengthen our economy through transformation. Only by doing so will we have enough resources for nation-building. Amid this uncertainty, we will be more pro-business and try to attract the best investments and job opportunities for Singapore.

However, we should not forget that the ultimate goal of economic development is to give opportunities for Singaporeans to fulfil their aspirations and ideals and to improve their quality of life. Therefore, not only do we need to be more pro-business, we also need to be more pro-worker, and help fellow Singaporeans constantly strive to better themselves, especially those impacted by the slowing economy.

MOM has expanded all the employment assistance schemes to help more workers, including the young, old, rank-and-file and PMETs, to constantly adapt and upgrade themselves as various industries undergo transformation. We will create new jobs for you and help you secure better job opportunities so as to strengthen our workforce with the Singaporean Core.

For workers who lose their jobs because of transformation, please do not lose heart. We will help you look for opportunities amidst this crisis, learn new skills and switch careers.

We will do our utmost to help you, but meanwhile, you must also do your best to help yourselves, for your own sake, and for the sake of your family.

So, let us be determined and strive hard together, make every job a better job, make every worker a better worker and make every career an even better career.

Let us sprint forth towards the future economy and the future Singapore.

(In English): Mdm Chair, I became an active member of Singapore Tripartism when I joined NTUC in 1996, 20 years ago. At that time, I learnt from then Secretary-General Brother Lim Boon Heng that a job is the best welfare for our workers.

Then, came the Asian Financial Crisis when we saw record retrenchments; I think about 29,000 workers lost their jobs. Unemployment went up. Workers and union leaders became even more and more worried about the future. So, I decided to add one more line: a job is the best welfare and full employment is the best protection for our workers.

The positive employment outcomes which I outlined earlier and that we have today did not come easy. It did not happen by chance. We actually made it happen here in Singapore.

In the Labour Movement, there is a strong spirit of solidarity because the Labour Movement always believes that unity is strength. And I believe that this spirit applies to the whole nation.

We have major challenges to overcome, as I had outlined earlier, to transform to become more manpower-lean and productive, to build a stronger Singaporean Core and to strengthen the global competitiveness of the Singapore Workforce. Working in unity, whole-of-Government, whole-of-Tripartism, whole-of-Singapore, I believe we can succeed, and we must succeed to secure the best welfare – good jobs, good careers and the best protection, high employment, low unemployment – for our fellow workers, our fellow Singaporeans. [Applause]

Fairness in Employment

Mr Muhamad Faisal Bin Abdul Manap (Aljunied): Madam, it is recognised that MOM has taken a couple of steps towards ensuring fair employment within Singaporeans' workplace, with TAFEP and FCF as two examples.

However, there are two key problems with existing schemes. First, a lack of enforcement measures. While the Government has, in the implementation of FCF, recognised the existence of "double weak" firms, firms that are found to have flouted the rules will only have their work pass privileges curtailed. A second problem is the low take-up rates of voluntary schemes. To date, 4,439 organisations have signed the employer's pledge under TAFEP but, with 9,106 manufacturing establishments and another 58,784 service establishments in 2014, TAFEP's coverage does not seem substantive.

[Deputy Speaker (Mr Lim Biow Chuan) in the Chair]

More can be done in pushing for an agenda in ensuring that the Singapore Core is able to contribute competitively but still ensure a competitive foreign labour force to be engaged by employers.

In order for the Government to effectively manage manpower policies in ensuring the Singapore Core and to enshrine the importance of fair employment practices within Singapore, I propose that a national employment framework be developed and instituted. This would unify all the current frameworks which loosely contribute to the Singapore Core drive into a single coherent framework to ensure minimal overlaps in policy.

To enforce the framework, additional enforcement powers to penalise double weak firms for discriminatory hiring practices should be implemented within the framework. Even then, such a framework will take time to be debated and hammered out. Transitional measures should be put in place to further the incentives for taking up fair employment practices.

I propose that a fair employment contribution fund where firms can contribute to help fair employment efforts. In return, firms can enjoy incentives, such as corporate tax rebates or CPF employee credits. The fund can be used to fund the agency overseeing any FCF activities.

Assistance for Local Enterprises

Mr Chong Kee Hiong: Chairman, SMEs are a vital part of our economy. However, our SMEs face challenges, such as tight labour market, difficulty in obtaining loans and an increasingly competitive environment. More needs to be done to help SMEs stay relevant and competitive.

The LEDS is a welcome initiative to help businesses adapt to a manpower-lean landscape and incentivise the development of a skilled Singaporean Core. However, not many businesses seem ready or willing to take on this challenge. Would the Ministry share what has been done so far under LEDS to encourage and support business transformation, and what more can be done, given the current business environment? How could the Ministry work closer with TACs to speed up the take-up rate?

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I am glad that the Government is introducing a new SME Working Capital Loan scheme to co-share with participating financial institutions 50% of the default risk of loans up to $300,000 per SME. Total business loans fell 3.5% year-on-year in January to $357 billion and SME loan growth is expected to be a low- to mid-single digit this year. This is understandable as the rising level of non-performing loans last year was a problem for Singapore banks. SMEs struggle to secure loans, some due to their short credit history and others due to a lack of collateral. This lack of capital is stifling businesses and hampering innovation in our economy. Will co-sharing of default risk change the bank's risk appetite in this business climate? Since it is an equal sharing of risk, will there be an appeal process through MOM if SMEs could not obtain the loans from the banks?

SMEs may also need smaller loans over shorter periods of time which banks may not be able to finance. It is heartening to note that, recently, crowdfunding sites have sprung up to meet this need of matching individual investors with small companies that require funds. The loans are more likely to be approved and are processed more quickly than at banks.

While this is good news for SMEs that need more funding, Singapore lacks specific guidelines for peer-to-peer lending. I would like to know whether there are plans to put in place guidelines to protect both lenders and borrowers that engage in peer-to-peer lending.

Workplace Support for Families

Mr Desmond Choo (Tampines): Chairman, progressive workplace practices are essential to supporting our young families in pursuing the aspirations of raising a family and building a career. A young Singaporean, especially a new mother, requires a transition period after her maternity leave to adapt to a new work and childcare routine. Especially for mothers who are breastfeeding, this transition period becomes even more critical. A period of flexible work arrangements can help.

During the Budget debate, my esteemed colleague, Mr Christopher de Souza supported my earlier call during the Debate on the President's Address to put in place eight weeks of FWAs on top of the 16 weeks of maternity leave. I support his bolder move of eight weeks of legislated right to unpaid maternity leave in view of FWA.

These FWA options are important symbols of where we stand as a society in valuing people as our most important asset. It also accurately reflects the challenges faced by our mothers. It also encourages our companies to seriously work towards providing FWAs.

Could the Ministry consider legislating the right to request for FWAs? Employees have the legal right to make a request in a reasonable manner for an FWA which can range from changes to hours, work patterns or locations of work. In the UK, an employer can be taken to a tribunal if they do not handle the request in a reasonable manner and there is a good business reason to do so.

In the meantime, can the Minister also share on the reasons for the relatively tepid adoption of FWA incentives under the Work-Life Grant? How can we enhance the Grant to improve the take-up rate of FWAs? What other measures has the Ministry implemented or is planning to implement to extend the adoption of FWAs? Can the Government and the Government-linked companies take the lead? Currently, we have the Tripartite Advisory on FWAs. Would the Ministry consider escalating the signature level and its support by turning it into tripartite guidelines of FWAs instead, to reflect its strong position in supporting young families?

Flexible Work Arrangements

Assoc Prof Daniel Goh Pei Siong (Non-Constituency Member): Chairman, according to the Minister, the proportion of employers with at least 25 employees providing one form of FWA stands at 47% in 2014. However, the actual number of employees who utilise FWAs appears to be very low. According to the Minister, the FWA incentive under the Work-Life Grant has covered only about 900 Singaporean employees in two and half years.

Incentives are low and insufficient to encourage the utilisation of FWAs. The current FWA set-up is entirely dependent on employers' voluntary initiative. Giving employees the right to apply for the Work-Life Grant to fashion and take up FWAs in their companies, with their employers incentivised by the Government grant to accept, can overcome employees' inertia to FWA adoption. After employees initiate such applications, employers can refuse a request on reasonable business grounds but must discuss options available with the employees, with the Ministry acting as facilitator.

Another thing that the Ministry could consider under the Work-Life Grant is to promote all roles flex for larger Singapore companies. Last year, PriceWaterhouse Coopers Australia extended flexible working to all 6,000 employees. In all roles flex, employees' performance rather than actual face time and hours spent working becomes the most important criterion for work evaluation. Vesting employees such flexibility allows them to be at their best, fosters happy families so that employees can focus on their work and, therefore, positively impacts productivity.

Work-life Integration

Ms Jessica Tan Soon Neo: Chairman, with the increasing role that technology is having in both work and life, there is an opportunity to push for better integration of work and life. There is opportunity to leverage technology to allow for collaboration and productive work, allowing the focus on creativity and innovation, going beyond the mechanics of tasks. This will make work work for people. This, in turn, will raise productivity for organisations.

What measures are in place to encourage more FWAs for people in organisations for more effective work and, hence, greater productivity and higher employee morale?

As we talk about innovation and the need to restructure, I believe that we should also be open-minded to new models for work, rather than just thinking of providing FWAs for both small and large organisations. In fact, especially for smaller organisations, where resources are scarce, companies should innovate on how work is done.

The use of technology alone, however, is not sufficient. There must also be relevant changes to work processes, HR and performance policy to enable quality work to be done. Just imagine how much time can be saved if people are equipped and allowed to work from wherever they are.

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When a professional completes a meeting with a client at the client's office, he is able to access the relevant information he requires via whatever device he carries, to go and prepare for his next meeting with his colleagues from any suitable location in the client's office or to go to a site nearby. Just imagine how much time he saves as there is no need for travel time in terms of the effort to return to the office before being able to have his next meeting. Just think about how much time that could also be saved or be released to do work which is needed. This changes the whole concept of allowing people to do their best work from wherever they are, made possible by leveraging the right technology to enable a quality work experience.

Several Members in this House have asked for FWAs for mothers, especially new mothers. I would say that, while well-meaning, this might actually be counter-productive. For flexible work to be made available should be a benefit made to all, so that it changes the whole work culture and you do not single out a particular group, and that people can, therefore, work and access the kind of work and information they need for quality work experience and clear outcomes and impact.

Gearing up HR for Strategic Role

Mr Melvin Yong Yik Chye (Tanjong Pagar): Sir, we believe that our HR practitioners are well-versed in HR knowledge. However, general HR knowledge may not be enough for these professionals to add strategic value to companies, industries and the Singapore economy. For that to happen, they must also acquire knowledge, hone skills and gain experience in the context of Singapore.

There are three key realities that HR practitioners in Singapore must know and be familiar with. The first is tripartism. I have spoken at length in my maiden speech in this House on the unusual tripartite partnership in Singapore and how it serves as a key economic advantage for us. The second is a local workforce that is maturing and soon peaking in numbers. The third is how to ensure a Singaporean Core within a nationality-diverse workforce.

Until and unless there is a deep and proper understanding of these realities and the design of methods to help companies do well in this context, the HR function will not be able to advance beyond a tactical and administrative role. Can MOM provide an update on the work of the HR Sectoral Tripartite Committee in relation to these aspects?

Support for Low-wage Workers

Mr Zainal Sapari (Pasir Ris-Punggol): Looking back, I am happy to note that the Government has shown great support in working with the Labour Movement and our Tripartite Partners to embark on breakthrough initiatives, such as the Progressive Wage Model, NTUC U Care Centre, Best Sourcing, the Inclusive Growth Programme (IGP) and others, to help low-wage workers. We are definitely moving in the right direction to become a more inclusive society. The importance of these initiatives cannot be understated. All these efforts have resulted in better wages and working conditions. But we still have a long way to go.

For several of our low-wage workers in Singapore, these initiatives provide hope at improving their livelihoods and hopes for a better future for their families. In my Budget Debate speech, I suggested that we set a target to have a higher real wage increase for our workers at the 20th percentile, compared to the median. Will MOM, perhaps working together with other relevant Ministries like MOF, consider setting such a target?

I also made a suggestion of mandating Annual Wae Supplements (AWS) and Annual Increments as part of the licensing condition for the cleaning, security and landscape sectors. This may be a more practical approach in helping low-wage workers, compared to mandating compliance with the National Wages Council's recommendations targeted at them.

The Government can also explore supporting job redesign initiatives to ensure alignment with SkillsFuture, so that workers can apply the skills they have acquired to improve their productivity. The SMP committees, where there might be a large number of low-wage workers, need to work together to have a more customised approach to meet the needs of low-wage workers in the respective sectors to achieve the desired outcomes.

That being said, can MOM provide an update on its efforts to uplift low-wage workers and the key outcomes so far? Are there plans to expand the scope of support provided to this group of vulnerable workers?

Assisting Unemployed, Older and Retired Workers

Mr Chong Kee Hiong: Chairman, in the last few years, the Government has introduced various schemes and initiatives to help low-wage workers, including Workfare and the WorkRight Initiative. It has also worked with Tripartite Partners to develop and implement the Progressive Wage Model in certain low-wage sectors. In the event that this group of workers lose their jobs, what kind of support does MOM provide to these vulnerable workers?

When companies downsize and close down, MOM should make it a requirement for the companies to direct the displaced employees to WDA, so that the Government can assist them through the various schemes and resources, such as the National Jobs Bank, CSP and PCP. Retrenched employees may not be aware of or are too shy to go for such help, but if this forms part of the retrenchment programme of the company, it will have more outreach.

The National Jobs Bank has a number of jobs in low-wage sectors, but many low-wage workers will need help to access this website. Some are illiterate. Others do not have computers or Internet connection. Would MOM consider setting up physical National Jobs Bank pop-up booths at accessible locations, such as MRT stations or community centres?

WDA runs a number of job and career support programmes. Would the Ministry provide an update on the effectiveness of and the challenges faced by these schemes?

For retrenched PMETs faced with structural unemployment, is there scope to increase the number of PCPs to help them find jobs in growth sectors?

Currently, Special Employment Credit is given to companies that hire older workers. To encourage companies to continue the employment of its existing older workers, would the Ministry consider extending a scheme similar to Special Employment Credit for these companies?

We should also provide more work options for older workers and retirees who want to work shorter hours or flexi-time. So far, FWAs are not very common in Singapore. Would the Government work with the TACs to assist companies in redesigning workflows to allow for more FWAs, so that it will become more widely adopted? Not only will this help to improve the work-life balance nationwide, but it will also enable more mothers, older or retired workers to participate in our workforce.

Would the Ministry share with us how widely have FWAs been adopted within the Civil Service and Government agencies? I would also like to know the form these arrangements take and the profiles of the involved staff in terms of job functions, seniority, gender and duration of the FWAs. Does the Ministry have any quantifiable targets and deadlines for the percentage of workplaces which offer FWAs? How does Singapore compare with other developed nations in this respect? These would be good benchmarks for private companies to follow.

Workplace Safety

Mr Melvin Yong Yik Chye: Sir, our workers deserve safe working environments, so that they can return home safely to their families and loved ones after a hard day at work. Unfortunately, we continue to experience workplace fatalities where workers die due to workplace accidents.

The number of workplace fatalities has been increasing, from 56 fatalities in 2012 to 66 in 2015. According to the Workplace Safety and Health Council report released earlier this week, 22 workers have died from workplace accidents since the start of 2016. This is more than the 18 reported during the same period last year. These workplace fatalities included the two young lives which were lost in a tragic accident on the Mass Rapid Transit (MRT) tracks near Pasir Ris MRT station just last month.

These numbers are truly alarming and beg for immediate attention. We must prevent the occurrence of workplace accidents and these accidents can be prevented. We simply cannot take workplace safety for granted.

Can MOM share how it intends to work with the tripartite partners to strengthen and enforce workplace safety measures across all industries?

The majority of our companies are SMEs and they may not have adequate resources for comprehensive workplace safety measures. Some of the challenges they face include lack of expertise in workplace safety and the significant financial costs involved. Can MOM do more to encourage and support our SMEs in accessing and managing workplace safety more effectively?

Under-employment Indicators

Ms Sylvia Lim (Aljunied): Chairman, as mentioned in my Budget Debate speech, I believe the Government should put in more effort to track under-employment. Let me highlight three areas.

First, the Government could put into its headline numbers not just the employment and unemployment rates but two other indicators it is already gathering. For some years, the Government has been publishing some statistics on "time-related underemployment", showing the hours worked versus the hours that the employees are available and willing to work. The Government also gathers data on "discouraged workers", namely, those who have given up the job search. Headlining time-related underemployment and the number of discouraged workers will focus public attention on these two important statistics that are not captured in the employment and unemployment headlines.

Secondly, while I accept that measuring underemployment by time is probably the only internationally accepted measure, we know that working fewer hours is just one aspect of underemployment. How can we measure underemployment where a person is being underutilised in terms of his earning capacity? Could we consider collecting data on income earned versus median income for that qualification and age, or perhaps compared with previous income?

Thirdly, it has been noted in the US that in the last decade, the growth of temporary and contract jobs has surged, with the proportion of Americans working as independent contractors soaring. In Singapore, according to the Ministry's report on the Labour Force 2015, there were 202,000 contract workers. Does this figure capture all those who are on contract, freelance or ad-hoc work arrangements? Can we expect such alternative work arrangements to increase, given the uncertain economy, the need for employers to manage costs and the automation of jobs? If so, there will be more Singaporeans facing issues, such as poor job security, intermittent Central Provident Fund (CPF) contributions and little or no medical benefits. Are we adequately measuring the number of Singaporeans who are underemployed in this way?

Loss-of-income Shield Insurance

Mr Azmoon Ahmad (Nominated Member): Mr Chairman, today, I must say I have learnt a lot from Minister Lim Swee Say. There are so many terms – PCP, CSP, LEDS. For me, in my line of work, LED means light-emitting diodes, but yours is a bit different. Nevertheless, I try to pick up.

The Minister have shared a lot about PMEs and I am really, really glad that so many things have happened. Nevertheless, I would like to express my concern about the PME group, especially after doing a lot of community work for the last 13 years.

Those in the middle-aged category who are skilled and possess tertiary educational qualifications, generally struggle to be re-employed after being retrenched. A Straits Times report on 20 July last year reported that 57% of retrenched Singaporeans and Permanent Residents managed to be re-employed within the next six months – 57%. For the PME group within this retrenched lot, only 49% are able to find a job within the same period. This is lower than the lot average. For those aged 40 and above, within the same group, the re-entry rate was only 53%. This meant that roughly half of the older PMEs could not find a job within six months of being laid off, let alone finding one of comparable grade and salary.

The NTUC PME Centre saw a jump of 265 cases of PMEs looking for assistance in employment and employability – from 253 cases in 2014 to 518 from March 2015 to February 2016. It is worrisome that 77% of the PMEs looking for re-employment were aged 40 and above.

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Losing one's job through retrenchment can be a devastating, if not traumatic, experience. The affected worker may lose his or her self-esteem and self-confidence. It could lead to health issues when one's mental state is not at rest. For the family breadwinner, this is unthinkable.

Here, I would like to qualify that I appreciate all these safety nets that MOM has put in place. What I am going to propose here is not to undermine what has been done, but I thought it would complement the whole safety net framework.

To cushion the impending tough and challenging experience, I would like to propose a Temporary Income Shield (TIS), an insurance scheme that is modelled after the MediShield. TIS is for those who have lost their job due to retrenchment, resulting in an immediate loss of income. It is meant to cushion the impact, providing continuity to their daily life and mitigating potential disruption to their children's educational progress and the well-being of their elderly parents.

The proposed scheme is progressively decreasing in nature, that is, the payout is calibrated downwards towards zero at the end of a four-month period after being laid off. How does it work? For the first month, he/she receives 75% of his/her last drawn salary. In the second and third month, it is 50% of his/her last drawn salary and, the fourth month, which is the final month, it is 25% of his/her last drawn salary. Knowing it is going to go down, it will give him the urgency to find a new job. So, this is the proposal I have. The last drawn salary is capped at $6,000. That is the proposal I have. Of course, we can discuss further the details.

During the four-month period, the worker is encouraged to take up new skills to help him/her gain re-employment. All other existing schemes are made available. Upon re- employment, the TIS scheme will be terminated automatically. On the other hand, the scheme will lapse after four months, even if the worker has not gained any employment. It is just a temporary cushion given to the worker.

I would like to suggest that the scheme be offered to all working and salaried employees with a monthly income of not more than $10,000, and the payable insurance premium made from the worker's monthly CPF contribution. The usage of CPF contributions towards this TIS scheme is just an expansion to its purpose to supplement the workers in times of dire need, such as medical, housing, education, retirement and, in this case, unforeseeable loss of income.

I acknowledge that this idea is not a new one. It is similar to others which have been raised before. Like I mentioned in my speech in the Budget Debate, as the old economy gets replaced by a new one, job redundancy and obsolescence are inevitable. I salute the Government for taking proactive and constructive measures for our workers through retraining and reskilling. I believe we should continue to explore all possibilities, especially so when I reckon this issue will be with us for many more years to come. I also believe it is going to get tougher with each passing year.

The Chairman: Mr Azmoon, your suggestion is very interesting, but I am afraid you have run out of time.

Mr Azmoon Ahmad: I think we can study further if you need more information. Thank you, Mr Chairman.

Help Families Optimise CPF Savings

Ms Foo Mee Har (West Coast): Mr Chairman, I thank the Government for the Silver Support Scheme, which is a major new feature of our social security system. This will be especially helpful to many women who "work" at home as the primary caregiver of their families, with no paid wages and little retirement savings. So, this is going to be very helpful to them.

Taken together with the slew of enhancements made to CPF in 2015, the scheme is now more attractive, more comprehensive and better catered to the diverse needs of Singaporeans.

However, how much does the average Singaporean understand of the CPF scheme in order to fully leverage its benefits? Other than a small group of financially-savvy individuals, it is not easy for most of us to remember the different tiers of interest rates offered in the different accounts, as well as the different rules that apply, so that we can optimise our own savings and those of our family members.

Sir, I think the instinctive solution to this problem is to recommend that the Government launch a comprehensive education campaign. But I would admit that this will not be an easy task, given the complexity of the system. Furthermore, we should consider some learnings from the field of behavioural finance. Drawing on the research of psychology of decision-making, behavioural finance argues that many financial phenomena are the result of less than fully rational thinking on the part of the participants. Behavioural finance helps explain sub-optimal trading and investment behaviours. The science of behavioural finance is already applied to understand asset pricing, investor behaviour and corporate finance.

Sir, I urge the CPF Advisory Panel to consider applying behavioural finance in Part II of their work to help guide optimisation of CPF savings. MOM should study carefully the patterns of transaction of CPF members and take a very proactive role to help members to fully optimise the benefits of the CPF scheme.

For example, since January 2016, CPF members can transfer CPF savings above the Basic Retirement Sum to their spouse's Special Retirement Account instead of the previous Full Retirement Sum. This change means couples stand to benefit significantly if they have varying levels of CPF savings between them. The savings enhancement for a couple can be substantial if the husband transfers, for example, some of his eligible CPF funds to top up the low balance retirement account of his wife, which now attracts 6% for the first $30,000, and 5% for the next $30,000. Overall, in Singapore, we are still seeing a gap of 14% in CPF balances between male and female members. But I believe that even though it is still early days, as it was just implemented, thus far, very few CPF members whom I have spoken to have thought about this, let alone take action to enhance their savings in this way.

I would like to repeat a request that I had raised during last year's COS, that the Minister consider providing "auto sweep" functions for CPF members to transfer their savings to their spouse's account to top up the Basic Retirement Sum. CPF members who do not wish to participate can opt out. But they should be helped by a statement explaining how much less they will get as a couple if they do so. This approach may help result in more couples benefiting from the extra interest rates, which will be particularly welcome for lower balances.

Sir, CPF is a great savings scheme. We must do our very best to ensure all Singaporeans can take full advantage of it.

Silver Support

Mr Chen Show Mao (Aljunied): Sir, come July, the first Silver Support Scheme payouts will be made to some 140,000 Singaporeans above the age of 65. The payouts are meant to provide a modest but meaningful supplement to their retirement incomes in support of the bottom 20% to 30% of Singaporean seniors. I welcome this support.

I would like to reiterate our earlier calls for Silver Support payments to be made monthly instead of quarterly. With monthly payouts and a more consistent liquidity that they provide, the elderly will be better able to manage their day-to-day expenses. Would behavioural economics suggest that making the payouts monthly could even nurture the seniors to use more of the payouts to pay for those significant living expenses that are incurred monthly, such as utility bills and others? If they were to do so, it will help them better manage their limited cash flow.

I hope the Minister will also consider adjusting the amounts of future payouts for inflation, perhaps at the start of every term of Government, to ensure that the support our needy seniors receive keeps up with the rising cost of living.

As Members have said in many different ways, I hope that a degree of flexibility can be built into the eligibility considerations of the payout scheme involving the three criteria of lifetime wages, housing types and household support. I appreciate that clear-cut rules and a high degree of administrative efficiency may be required to deliver Silver Support to needy seniors in large enough numbers. However, balanced against that consideration is, of course, our hope that specific needy seniors who deserve support do not fall through the cracks of rigid eligibility criteria. Some use of resources —

The Chairman: Mr Chen, I am sorry, you have also run out of time.

Mr Chen Show Mao: Yes, Sir. Some use of resources, time and effort in making discretionary assessments in exceptional cases would be well-spent.

The Chairman: Mr Louis Ng.

Better Collaboration between MOM and NGOs

Mr Louis Ng Kok Kwang (Nee Soon): Sir, there is a significant population of migrant workers currently residing and working here in Singapore. To address the multifaceted problems they face, we need holistic and cross-disciplinary solutions. This may be a task too large for any one body to take up on its own. Our universities and members of civil society who have worked with migrant workers are sources of information and practical expertise that could be a brain trust for the Government.

Will MOM consider the creation of a working group that includes representatives from the Ministries, the Universities and civil society to tackle migrant workers' labour issues, as the universities can provide comparative jurisdiction knowledge and technical knowhow, and non-government organisations (NGOs) can provide an on-the-ground perspective of how the system functions in reality?

I believe that with greater collaboration among the different stakeholders in the sector, we can show that Singapore also cares for and about the workers who have contributed to our nation-building.

The Chairman: Minister of State Teo Ser Luck.

The Minister of State for Manpower (Mr Teo Ser Luck): Mr Chairman, I am addressing the House about LEDS.

The economic environment situation is getting very real, so we have mentioned that there will be structural labour market challenges, such as slower workforce growth. Workforce growth will drop by more than half in the next five years. But there are also other challenges, such as external economic macro challenges, whether it is the US undergoing an economic recovery or China slowing its growth. There are also security issues around the world. We should also not forget that technology has advanced to the extent where start-ups are posing threats to traditional businesses. So, we hear a lot about disruptive technology.

But, more importantly, in fact, across the world, we are all facing productivity challenges. Productivity growth has challenged us and Singapore has to punch above its weight in order to ride to economic success. Companies are faced with this issue, especially SMEs. That is why we need SMEs to review and know what they need to do to enhance their processes to enable themselves to compete in the marketplace.

Our policies also need to catch up. We need to make sure that we have an ecosystem and environment for SMEs to grow and help progressive businesses to undergo transformation. We hope that these companies, especially SMEs, which comprise more than 90% of our registered entities, will continue to build a Singaporean Core in a very manpower-lean economy. If it is going to be manpower-lean, companies will have to learn to survive in this very manpower-lean economy by being lean themselves.

Late last year, Minister Lim Swee Say launched the LED concept. It is a pro-business and pro-worker concept at the same time. I was in MTI for five years, working on productivity schemes. Applications for productivity schemes continue to go up. The question we ask ourselves is: why is the productivity index not going up as well? Productivity schemes and grants cover a wide area. They have breadth, but not the depth. So, many companies apply for productivity schemes and grants and they get the grants but the change is not comprehensive enough to attain a productivity movement or a lean manpower outcome.

When I understood what the LED concept was about and the vision of what Minister Lim wanted to do, I thought: "This programme would build depth." It would require the firms to dig deep into their companies to look at the processes that they have and see what changes they would have to make, before they could start thinking about what productivity schemes or grants can be put in place.

From concept, we developed it into a scheme. Chairman, with your permission, I have asked the Clerks to place a handout, entitled "LED Scheme – Integrated Support", on the hon Members' seats during the tea break.

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LED hopes to achieve a few objectives: quality workforce, manpower-lean, developing Singaporean Core. If we achieve the three objectives mentioned above, we are going to be future-ready. It is about helping companies to become more manpower-lean and more productive. Over the last few days, in this House, many people used sports analogies, from marathons to high performance sports. I want to use these as well, since I am a very passionate sportsman.

In the LEDS, it is really like weightlifting. You see some weightlifters are lighter, but they can lift as much as those who are heavier in weight. By right, if you are heavier, you are supposed to lift more or lift the same weight. But some of them who are thin, they can lift the same. This is what we call the power-to-weight ratio. If the power-to-weight ratio is high, you are super fit and super strong. If your power-to-weight ratio is one-to-one, then you can only lift your own weight, and that is average. We want the lean companies or manpower-lean companies to attain high power-to-weight ratio, and that would mean to punch above their weight.

To achieve that, they have to undergo three phases. These three phases, simply put, include the current state of the workforce. Then their business processes will go through a transition of two years – with automation, productivity, process change, job redesign, putting in computerisation and changing the workforce composition in order to achieve the future state. These three phases will need to be supported by the agencies, policies and Government schemes as well. So, we are going to help SMEs undergo these three phases.

First, we will assist them. We will assess all the proposals and see whether their proposals for productivity and being manpower-lean could really result in meaningful change within, say, two years.

Second, one of the advantages of LEDS is that it could consolidate and integrate all the several other schemes into one. So, businesses do not need to worry about what schemes and what productivity grants to apply for. As long as they have the intent to become more manpower-lean, and they apply and are approved as an LED-supported company, we will help to coordinate all the different Government schemes needed for it to succeed. Within that coordination, we provide temporary flexibility in foreign manpower policy to help them. These foreign employees can then impart their skills and knowledge to our local workforce, so that locals can be upskilled and take on better jobs. This temporary foreign manpower flexibility can then be withdrawn.

Thirdly, we will handhold the companies through the whole implementation process. It is not an easy process, but definitely achievable. Based on the applications that I have received so far, it is quite promising. But we want to do more. We need the arms and legs and we need the partnership of TACs to help us.

We have appointed 10 of them. We call them the LED multipliers. They include the Singapore Chinese Chamber of Commerce and Industry and NTUC's U-SME. The LED multipliers will educate and handhold companies in the whole application process. SMEs need not worry about whom to approach, because they can approach any of these 10 multipliers. Even the SME Centres, SMEs can approach them and the SME Centres will guide them through the process.

So far, the LED multipliers have held four road shows, and I have participated in all of them, and we would want to continue to build up this outreach. To date, all the 10 multipliers have plans to engage their members. We will want to support them further.

We are going to link up these 10 LED multipliers, not just with business advisors, but also consultants who are professionals in productivity as well as manpower-lean strategies and processes. Since the launch of the scheme, we have received applications from 79 companies, from a broad range of sectors, such as F&B, construction, food manufacturing, ICT and media, professional services, electronics, hotels, logistics, precision engineering and others.

I am glad to see that the Member Mr Lee Yi Shyan has mentioned F&B. They form the majority of the applications. There will be a fair bit of transformation in that sector if more come forward.

There are also many who apply for other grants but achieve manpower-lean outcomes without needing temporary foreign worker flexibilities. We have more than 200 companies in that category. So, there is hope for higher productivity moving forward, because there is greater depth now in terms of their transformation and process change.

We have studied all the applications and proposals and we found that there are three commonalties in this whole development and in their proposals.

First, they centralise a lot of their operations. What this means is that they share facilities among groups of companies. We have more than 10 companies coming forward and saying, "Let us come together, take our basic processes and centralise them", thereby achieving some economies of scale and reducing wastage and then, through a hub-and-spoke kind of network, they could do their own differentiation.

Second, they have an automation plan. This automation plan helps them to combine man and machine, as well as to put in machinery within a business process or operational process to make it more efficient. They also support job redesign and reduce lots of manpower wastage.

Thirdly and most importantly, they develop new skillsets, or enhance the skill development, especially for our local workforce. This imparting of new skills will align to our SkillsFuture vision and mission to enable locals to take on new types of jobs in future. So, if the company changes, the worker's job changes.

Let me give Members an example. A good example comes from the Indian Restaurants Association (Singapore). Fourteen members of the Association collaborated to form a consortium. You are probably wondering how they can come together because they could be competitors as well. But they could, because they felt that there were some basic processes that were the same, and they could consolidate them.

So, firstly, they achieved the objective of centralising shared services. The consortium will form a central processing unit, or a shared kitchen, where the basic processes will be centralised. Basic processes involve preparing the certain basic ingredients – onions, cabbage, vegetables and so on. Subsequently, these will be delivered to the restaurants' individual kitchens for their own recipe, so that they will prepare the dishes differently. That will differentiate their dishes.

Secondly, they will automate, putting in new types of machinery and equipment in the central kitchen. For some, automation will be done in their individual restaurants, in their individual kitchens. That helps to upskill the workers too. The skills transfer is extremely important, because they are building a sustainable pipeline of local Indian cuisine chefs. They want to have that pipeline, but this involves skills transfer and capability development, and they need foreign chefs to come to Singapore to transfer skills and knowledge to locals during this transition.

So, MOM provides two years' flexibility to retain S Pass chefs beyond the company's foreign manpower quota. These chefs are needed to impart skills and knowledge to local trainees who can take on such better jobs in future. With a pipeline of skilled Singaporeans ready to take on critical roles, these foreign chefs will then be released once the transition has been achieved.

It is not easy to achieve such a manpower-lean state and we are still going through the process. In fact, we only appointed the multipliers in January this year and the scheme was only launched late last year. But we saw a lot of progress, and we want to work by sectors, clusters and individual companies.

I fully agree with Mr Chong Kee Hiong, Mr Lee Yi Shyan and Mr Thomas Chua that more should be done to help more businesses to break these barriers and shift mindsets in order to achieve this. You have to think out of the box, change your mindsets to do so. But it takes the whole-of-Government as well to support such a transformation programme. This year's Budget has got a lot to do with Industry Transformation Programmes and LEDS plays its part to do so.

LEDS also depends on good HR practices, and good HR practices require good HR and qualified HR professionals. In managing manpower and the workforce in a company, it has to go beyond HR or human resources. It has to go into human capital. It is not just human resource, but human capital. There is a difference here, especially in the way we plan, and in managing the human resource within the company. HR is not just about plugging holes: when there is a job vacancy, you find a suitable person, you plug a hole here. A lot of times they are faced with situations which extend beyond recruitment, with retention, for example. We need a strategic and longer term plan. Look at every single individual, not just as a factor of production, but as capital for investment. Invest in them early, even for our mature workers.

As Mr Thomas Chua has pointed out, companies will need to focus more on building and nurturing human capital, investing in identifying each employee's strengths and making the best use of differentiated talents. We have many good examples that did that, and many are SMEs. Sometimes, it is not about investing only in the young, but investing across the board – young and old.

Let me give Members an example. ROHEI Corporation, a local corporate training SME consultancy, is one such SME. They advocate "people above process", often going out of their way to nurture and guide their employees towards achieving their life goals. When their senior consultants in their 50s expressed interest to master different skillsets and practices offered by the business, the company readily supported and guided them to acquire those skills, even though they were close to retirement age. They wanted to ensure that their wisdom and skills could combine together to help the company. This ensured that they could continue to value add, even in their golden years.

Every single person counts, they are our capital, they are our assets. But you need a good HR practitioner if you want to implement such a process. All HR practitioners now have more demanding jobs. To upgrade the HR practices in the different sectors, we need to upgrade their learning process. We need to upgrade their certification process as well.

We formed the HR Sectoral Tripartite Committee (HRSTC) in September 2015 and it comprises unions, businesses, the Government and IHLs. They are currently developing a HR Sectoral Manpower Plan (HRSMP). Mr Melvin Yong has asked for an update. Over the last six months, the HR Sectoral Tripartite Committee has engaged over 150 stakeholders through six different engagement sessions.

One recurring feedback is that they felt the need for HR to evolve to better support business strategy and to be more strategic, to think in the longer term, to be able to look at the macro view of the company, basically, to think like a chief executive officer. They have to move from focusing on operational and transactional approaches, to a more strategic approach, to look at how the company moves forward, forecast its manpower needs in the future. Employers expect that HR professionals can better apply these skills and align them to the organisation's goals. So, they cannot work in isolation. The HR strategy has to be integrated within the company. The committee is also recommending that we develop a pathway because of that requirement.

Ms Thanaletchimi will, therefore be pleased to know that one of the initiatives being considered under HRSMP is the development of a National HR Professional Certification Framework. We are looking at setting up a system to certify HR professionals based on components, such as HR competencies, HR work experience, professional code of conduct and ethics. Also, they have to possess an understanding of local employment laws, regulations and practices.

It is not just certification. It is a progressive learning ladder as well. This framework has to provide the HR professionals with a comprehensive roadmap to develop their own capabilities. They need to advance their careers through that. HR professionals, once they have gone through the process, can then better support businesses and also enhance their value to the organisation.

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The work of the HR professionals has become more demanding. As the expectations increase from bosses to workers to everybody, sometimes, they are sandwiched in the middle. Many times, the expectation from the workers or the employees is about the work-to-personal time ratio. As Ms Jessica Tan had mentioned: how do you integrate that work and that life together? It is not easy to find that integration.

We encourage FWAs in the workplace. And it is a very critical component and critical success factor for any good company that wants to retain its staff, wants to keep it more dynamic and also wants to recruit personnel.

Ms Jessica Tan is right to highlight that FWAs can help businesses thrive, leveraging technology to do so, enhancing it. For example, hotdesking, working from home, working from any other place – it is a flexible workplace. We know that the majority of global businesses have reported increases in employee productivity and company revenue as a result of implementing FWAs. Microsoft is one of them.

More businesses are recognising these benefits. The proportion of companies offering at least one form of formal FWA to their employees has increased from 38% in 2011 to 47% in 2014, but it is a never-ending effort to get more companies on board. I agree with Ms Jessica Tan and Mr Desmond Choo that more should be done.

The Tripartite Committee on Work-Life Strategy (TriCom), which includes representatives from trade associations, has launched several initiatives. The Tripartite Advisory on FWAs was launched in November 2014 to help employers, supervisors and employees through the journey of implementing FWAs. But more efforts in awareness and education are needed. So, we rolled out the Work-Life campaign, which concluded in March 2016, to reinforce that FWAs would benefit both employers and employees.

An online resource portal will also be launched to provide employers and employees with a one-stop access to resources related to the adoption of FWAs. Both initiatives are targeted to be launched in the second half of 2016. Moving forward, we will take a more targeted approach towards some of the sectors that are facing challenges to adopt the FWAs.

We note Mr Desmond Choo and Assoc Prof Daniel Goh have asked about Work-Life Grant adoption rates. The take-up of the Work-Life Grant is improving, from 287 applications in 2014 to 549 applications in December 2015. In particular, the take-up rate of the Developmental Grant, which defrays the cost of companies on a pilot scheme, is increasing.

Mr Desmond Choo has asked about the Government's stance on legislating FWAs. In countries like the UK and Australia, the law provides employees with the right to request such arrangements, but employers also have the right to consider these requests and refuse them. Assoc Prof Daniel Goh had also suggested a similar arrangement.

We need to carefully study the pros and cons of having such legislation in Singapore as being pro-business as well as pro-worker. How do we keep that balance? The success of it depends on integration of different factors, for example, the perception of such a practice within the society, and employers' and co-workers' attitudes towards FWAs. In other countries, FWAs are usually fairly prevalent before this legislation. That will not stop us from taking a review as well as making sure that we continue the awareness and education campaign. Fundamentally, employers and employees need to understand and be committed before such a culture can be in place.

Chairman, a large part of this Budget is about helping SMEs in the industry, and our workforce to adapt and grow for better jobs and better careers. We rolled out so many different schemes – LEDS, LEDS Multipliers, HR certification and HR/HC, the Work-Life Grant. Most importantly, mindsets need to shift, for SMEs need to have the spirit of enterprise to make the change, take that leap of faith and take action on it. The Government can only do so much. We are left with the SMEs to help themselves.

Transformation is not easy, but nothing comes easy. But if we put our hearts and minds together, I am sure we can build and ride the fourth wave of economic success towards the future.

The Minister of State for Manpower (Mr Sam Tan Chin Siong): Mr Chairman, I will now brief the House on three of MOM's focus areas. One, is to help older workers remain employable; two, is to improve low-wage workers' earnings; and three, is to improve workplace safety and health.

Allow me to, first, touch on older workers. Sir, our labour force is ageing quickly and the proportion of residents in the labour force aged 50 and over is about one-third now, up from about one-quarter a decade ago. This trend will continue over the next two decades and we must be prepared to accept and embrace this new reality and turn it into opportunity.

The Government has been engaging Singaporeans of all ages on various platforms. One common feedback that we hear is that seniors want to have meaningful jobs that tap on their wealth of experience and resources. But the responsibility for creating a sustainable working environment for older workers does not just lie with the Government alone, although the Government can take a lead in this area. Sir, employers and employees are important stakeholders and partners as well in achieving this common goal.

My Ministry has, therefore, been working closely with the tripartite partners to help older workers, under the Tripartite Committee on Employability of Older Workers, or Tricom in short.

The Tricom, which I chair, has introduced a series of initiatives to help older workers work for as long as they are willing and able to. We have made some encouraging progress in this direction.

Sir, today, our employment rate for older residents aged 55 to 64 is 67%. This is well above the Organisation for Economic Cooperation and Development (OECD) average of 57% and is comparable with some of the developed and advanced countries like Japan's 70% and South Korea's 66%.

Notwithstanding this encouraging process, I share Mr Chong Kee Hiong's view that more has to be done to encourage the hiring of older workers. However, we cannot achieve this goal by giving incentives alone. For there to be a truly age-friendly workplace, mindsets must be changed. The nature and the design of the jobs must also be changed.

To change mindsets, Tricom works through the Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) to champion positive workplace attitudes towards older workers. TAFEP has been conducting ongoing publicity campaigns to emphasise the value that older workers can bring to companies and their younger co-workers.

To change the nature of jobs and the working environment, we need to support employers to adopt good age management practices and redesign job processes for their older workers, a point highlighted by Mr Chong Kee Hiong. We have been providing our support through the Workpro grants. To further enhance the effectiveness of the Workpro scheme, MOM and WDA are in the process of reviewing this scheme. Details will be released soon. I wish to take this opportunity to strongly encourage more employers to make use of the enhanced Workpro grants.

Sir, one key concern of the Tricom has been to balance wages with the employability of older workers. In the early years, older workers were less wage-competitive because of rigid seniority-based wages. When the minimum retirement age was raised to 62 in 1999, the tripartite partners at that time agreed that the law could provide some flexibility for employers to reduce the wages of workers turning 60 by up to 10%.

Since then, the tripartite partners have worked hard to promote flexible and performance-based wage systems. Today, the vast majority, more than 98% of the companies, no longer reduce wages at age 60. So, the wage-cut provision that was put in place in 1999 is no longer relevant today. I am happy to announce that from 1 July 2017 onwards, we will remove this provision from our law. Going forward, pay should be reflective of workers' job scope and value, rather than their age.

Let me now turn to re-employment of older workers. Four years since we introduced the re-employment concept, I am pleased to say that implementation of this scheme has been relatively smooth. In recent years, over 98% of local employees who wished to continue working were offered employment beyond 62.

When we introduced re-employment in 2012, we also committed to raising the re-employment age from 65 to 67 at an appropriate time. The Prime Minister shared at last year's National Day Rally that we will do so by 2017. So, again, I am very happy to announce that the tripartite partners have discussed and agreed that the effective date will be 1 July 2017.

I would like to assure Mr Chong Kee Hiong that before the law is changed in July 2017, the Government will continue to support companies which voluntarily re-employ older workers beyond 65. The additional wage offset of 3% for employers who re-employ workers above 65 will similarly be extended to 1 July 2017. This is to help smoothen the transitional process.

Even as we work towards raising the re-employment age, the Tricom has considered other ways to expand re-employment options for employees. We have received feedback that, sometimes, employers are unable to find suitable jobs in their own companies, but can help the worker secure re-employment in a related or subsidiary company. Unfortunately, the existing law does not provide for this.

We will, therefore, amend the law to allow a new employer to take on the re-employment obligations of the original employer, subject to the employee's agreement. As with the other changes announced earlier, this will also take effect on 1 July 2017.

The tripartite partners strongly agree that employers should consider all available re-employment options to identify suitable jobs for their employees. However, there will be situations where re-employment is just simply genuinely not possible. As a last resort, we have provided for an Employment Assistance Payment (EAP). In line with the raising of the re-employment age, the tripartite partners agreed to increase the EAP amounts and age coverage accordingly.

Taken together, all these measures mentioned earlier, represent significant changes for our re-employment landscape. To better prepare employers and their workers, the Tricom has updated the Tripartite Guidelines on Re-employment of Older Employees. It will provide details on many of the changes that I spoke on earlier. We will be releasing these guidelines in the next few weeks.

Sir, we strongly encourage employers to adopt both the spirit and the letter of the new re-employment practices ahead of the formal change in law. This is especially important, given our tight labour market in the coming years.

I will now turn to the second issue – low-wage workers. Mr Zainal Sapari has asked for an update on the measures the Government has taken in this area. Let me highlight two of the key Government initiatives targeted at uplifting our low-wage workers. They are Workfare and the Progressive Wage Model (PWM).

The Workfare Income Supplement (WIS) scheme has been instrumental in encouraging lower-wage Singaporean workers to continue working. The Workfare Training Support (WTS) scheme also provides significant support to low-wage workers to upgrade their skills so they can stay employable and enjoy higher wage growth.

As announced by the Minister for Finance in his Budget speech, the WIS and WTS schemes will be enhanced in 2017 to provide more support for our low-wage Singaporean workers who work and train.

In specific sectors with a larger concentration of low-wage workers, prevalent cheap-sourcing was causing wages to stagnate. To address this concern, we set up tripartite committees to develop PWMs. This is something that Mr Zainal Sapari is very familiar with. He is a champion for this.

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These PWMs provide cleaners, security officers and landscape workers with a clear pathway of career progression. The workers can look forward to earning higher wages, in line with higher skills and productivity improvements. PWM has been fully implemented for the cleaning sector since 1 September 2015. As of January 2016, about 40,000 resident outsourced cleaners are covered by this scheme. We will implement PWMs for the landscape and security industries through Government levers from 30 June and 1 September this year.

We are encouraged by the early PWM adopters in the security and landscape industries which have already sent their workers for the requisite training and they are also already paying them according to the PWM model. We strongly urge the remaining employers to expedite their plans to meet the PWM requirements, so that more workers can benefit from the higher skills and better wages and their employers can also benefit from workers' higher productivity.

Mr Zainal Sapari has proposed mandating annual wage supplements and annual increments for low-wage workers in the cleaning, security and landscape sectors. This is a major proposal which will not only affect workers' well-being, but also employers and the industry. It is, therefore, crucial to seek the views of the various stakeholders in the usual spirit of tripartism.

We will raise Mr Zainal's suggestion to the tripartite committees responsible for the PWMs for these sectors. And the tripartite partners will need to decide on what is appropriate and feasible, taking into consideration the interest of workers and bearing in mind economic conditions.

Sir, we are starting to see results of our various efforts to support low-wage workers. They are bearing fruits now. Over the last five years, real incomes of full-time employed Singapore Citizens at the 20th percentile grew by 2.9% per annum in real terms. This is comparable with the growth in the median incomes over the same period. We will continue to work very closely with our tripartite partners on this important issue.

Before I move on to my next subject, I would also like to address Mr Patrick Tay's point on freelancers. Freelancers are not covered by the Employment Act and the Work Injury Compensation Act (WICA) because there is no employer-employee relationship between them and their clients.

This is a complex issue which we should study carefully and not rush into. In the meantime, we will support efforts like those from the NTUC's Freelancers and Self-Employed Unit which has different initiatives for different groups of freelancers, ranging from taxi drivers to those in the creative and media sectors. This is in recognition that freelancers are a diverse group comprising many different trades, skills, values and services. It is, therefore, difficult to prescribe a one-size-fits-all solution to address such diverse and complex needs and situations.

Sir, let me now turn to my last subject − Workplace Safety and Health (WSH). In 2015, our workplace fatality rate was 1.9 fatalities per 100,000 employed persons. This is a slight increase from 1.8 in 2014. We are concerned. Although the increase is quite marginal but we are concerned, nonetheless. Just this year alone, we lost 22 lives at work, as mentioned by Mr Melvin Yong just now. That is 22 too many. In fact, personally, to me, every one fatality is just one too many. Accidents can be prevented. Therefore, I agree with Mr Melvin Yong and Ms Thanaletchimi that more needs to be done to raise our WSH standards.

We will adopt a four-pronged approach to reduce the workplace fatality and incident rate. First, we will raise awareness; second, we will build WSH capability; third, we will strengthen enforcement; and, lastly, we will impose heavier penalties.

My Ministry has put in a large amount of effort over the years to raise WSH awareness among workers, employers and the general public. To build WSH capability, we work closely with the industry to assist them in bringing good WSH practices to their workplaces.

In terms of enforcement, we conduct around 16,000 workplace inspections a year. That is more than 1,300 inspections every month. In the last few months, I have personally participated in three inspections, and I will continue to do so until I feel that the level of workplace safety reaches a satisfactory level. To strengthen deterrence, my Ministry will also be taking tougher actions against recalcitrant employers and will impose harsher penalties if things do not improve.

Fundamentally, WSH needs to be driven from the top. At the very top, we want industry leaders to set the tone and be committed to WSH. Recently, I started a series of dialogue sessions with top management from various industries, starting with those that have higher workplace injury and fatality rates.

My message to them is a simple and sincere one. That is, my Ministry is always ready to work together with the industry to improve safety standards. For those who need help to improve, we will assist them through different schemes. As pointed out by Ms Thanaletchimi, we will also recognise those companies which have achieved good WSH performance because we want to hold them up as good role model for others to emulate.

However, if companies do not take WSH seriously and flout the safety rules indifferently despite warning and advice, we will come down hard on them through stiff penalties. We are doing this as a last resort as we have the responsibility to protect our workers to ensure that they work in a safe and healthy environment.

Mr Melvin Yong is right in pointing out that some SMEs need more help with WSH training and capability building. Others lack the awareness. We will, therefore, be launching many programmes this year that specifically cater to them. More details on the WSH capability building programme will be announced later.

Sir, I have just outlined the key efforts of my Ministry in the areas of older workers, low-wage workers and workplace safety and health. Minister Lim Swee Say will now address the remaining issues in his round-up speech.

The Chairman: Minister, you have 16 minutes.

Mr Lim Swee Say: Chairman, please allow me to address some of the other cuts put up by the Members.

On the Employment Claims Tribunal raised by Mr Patrick Tay, we will set up the Employment Claims Tribunal early next year. I want to assure Mr Patrick Tay that we are equally mindful of preserving the role of tripartism in dispute resolution. Therefore, we will build in a higher claims cap in certain situations where the unions are involved. We will be introducing a new Bill later this year, which will include the necessary changes related to the Act that Mr Patrick Tay spoke of, to implement these changes.

On the FCF Advertising Requirements raised by Ms Thanaletchimi and Mr Chong Kee Hiong, I want to clarify that even though the FCF requirements for job advertisements is capped at $12,000, but all jobs, regardless of salaries, including those above $12,000 are also subjected to fair consideration. In other words, if a company is perceived to have adopted unfair practices, especially discrimination based on nationality, we will investigate. If found to be substantiated, the company is subjected to additional scrutiny, like those that I have mentioned earlier.

On TAFEP, Mr Faisal Manap raised the need to strengthen the framework for workplace discrimination. Currently, the arrangement is that TAFEP and MOM work together to promote fair employment as well as address discrimination in terms of whatever practices that we come across.

The arrangement is that the tripartite partner, through TAFEP, will do the promotion work whereas the enforcement will be through MOM. In other words, TAFEP, upon their promotion and investigation, if they come across any organisation which, in their view, has adopted the unfair practices, TAFEP will alert MOM and then we will take the enforcement. TAFEP's finding or assessment carries a lot of weight with MOM.

So far, the employers approached by TAFEP have mostly heeded the advice by TAFEP and made adjustments to their employment practices. Earlier, I mentioned about the "triple weak" and "triple strong". In fact, that will be another avenue for TAFEP to step up the effort not just in terms of promotion but advocacy as well.

Underemployment raised by Ms Sylvia Lim. Along with the unemployment figures, statistics on time-related underemployment and discouraged workers are also published annually, every year, in the Report on Labour Force in Singapore. The last report was released in January 2016.

In the latest report, Singapore's time-related under-employment rate was 2.9% by June 2015. It is low by international standards. What is even more encouraging is that it is on the decline. So, for example, in 2013, it was more than 4%, then in 2014, it went below 4% and last year, 2015, it went below 3%. This has to do with the tight labour market that we face today.

As mentioned by Ms Sylvia Lim, time-related underemployment is the only internationally accepted statistical definition of under-employment and it is recommended by the International Labour Organization, so we comply with that. As regards the share of discouraged workers in the resident workforce in 2015, it was stable and low at 0.4%. This is similar to the OECD countries.

On the issue of contract workers and freelancers, Ms Sylvia Lim asked whether they are on the increase, whether they reflect a rise in underemployment. The percentage of workers on contract, that means they are working as employees but on contract, has dropped from 12.7% in 2009 to 11.3% last year. So, 12.7% dropped to 11.3%. In the case of freelancers, they are what we call the "own account" holders, so they are like self-employed. They do not have employee-employer relationship. That percentage of the workforce has dropped from 9.2% to 7.9% over the same period, from 2009 to 2015. In other words, both employees on contract as well as freelancers as a percentage of the workforce have been on the decline. The question is whether they choose to be in this situation − contract or freelancer, or they are forced to be in this position. On the part of MOM, what we are trying to do our best is that we offer them options. In other words, if they feel that they do not want to continue with their contract work or be freelancers, I hope they will step forward, take advantage of our CSP, PCP, P-Max and all the other programmes that I talked about earlier.

On the issue of unemployment insurance raised by Mr Azmoon, first of all, let me make it clear that I do sympathise and empathise with workers who are affected by retrenchments and I appreciate the suggestions by various Members, including Ms Sylvia Lim and Mr Patrick Tay, for unemployment benefits or insurance schemes to help cushion the impact on such workers.

As I mentioned earlier, our situation in Singapore is quite different from the situation in most of these other countries. Our unemployment rates are low and our long-term unemployment rates are also low. At the same time, and this is something that is worth taking note, the practice of paying retrenchment benefits in Singapore is widespread. According to our latest survey, nine in 10 of the retrenching companies paid retrenchment benefits, and for the retrenched workers, likewise, nine in 10 received retrenchment benefits, including those from the non-unionised companies. It is a fairly standard practice in the industries and in Singapore today.

This is the reason why MOM is focusing our efforts on helping retrenched workers to go back to work as quickly as possible because unemployment is low, under-employment is low, long-term unemployment is low and there is a widespread practice of paying retrenchment benefits. The top priority for many workers is to go back to work. That is the reason why, earlier, I spent a lot of time going into a lot of details to explain the kind of options that we are offering to our workers. I hope that more of them can tap on the programmes that I mentioned earlier.

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Mr Azmoon suggested that one way is to allow workers to tap on the CPF savings to finance such schemes like TIS. My reservation is that today, CPF is already used to meet housing, education, healthcare and retirement adequacy. In other words, we should be very careful not to deplete these savings further by using them for other purposes unless it is really necessary to do so. For now, let us focus in helping the unemployed workers to go back to work.

Mr Lim Biow Chuan asked about retrenchment benefits and whether we can introduce compulsory retrenchment benefits. The tripartite partners have discussed this from time to time. The last time was at the recent review of the Employment Act and they came to the conclusion that it is important to allow the employers employees and unions to continue to have the flexibility to negotiate this, rather than prescribing it in the law. This is because the different retrenching companies are in different circumstances and, therefore, it cannot be a one-size-fits-all rule. As I had mentioned earlier, according to our labour survey, nine out of 10 retrenching companies did pay retrenchment benefits.

Mr Louis Ng touched on the role of NGOs and civil society. I agree with him. I would like to assure Mr Ng that MOM already regularly engages tripartite partners, academics and NGOs in the course of our work. These range from employment standards, supporting low-wage workers and retirement adequacy, to foreign worker management. Going forward, I would like to assure Mr Ng that we will continue to engage our social partners as we try to shape the new employment landscape together.

Ms ThanaletchimiI raised the issue of incentivising companies which hire older workers with lower foreign worker levies. Mr Chairman, firms which hire older workers currently benefit from the Special Employment Credit. A wage credit to firms, we believe, is a better way to incentivise the employers to hire more older workers and to keep them, rather than to give them a discount in foreign worker levy. This way, even firms without foreign workers can still benefit and be motivated to hire and retain our local older workers. Lowering the foreign worker levy may also lead to the unintentional outcome of these companies hiring more foreign workers, instead of keeping our older workers.

Ms Foo Mee Har raised the topping up of CPF and the automatic transfer of CPF between couples to enable them to enjoy higher returns on CPF savings. Let me say that I am in full agreement with Ms Foo that we should encourage more and more CPF members to top up the CPF accounts of their spouses, especially working husbands topping up the accounts of the women at home. That is the reason why we have amended the regulation to enable more members to do that kind of transfer like lowering the qualifying savings from the full retirement sum to the basic retirement sum.

Having said so, if I may quote what Minister Tan Chuan-Jin said at last year's COS where this issue came up as well. He said that the decisions on CPF top-ups and transfers between spouses are "personal decisions best left to the couples to decide. It would be intrusive for the Government to intervene" by automatically optimising the split of CPF savings between husband and wife. I must say that I do agree with him. What I would do is that I would, together with CPF, step up the effort to create greater awareness in the community so that, hopefully, we get more and more members of the community to be fully aware of this additional interest that they can benefit from. I hope that Members here can also help us to reach out to the ground.

Mr Chen Show Mao raised a question about Silver Support. He asked whether it can be paid on a monthly basis, instead of a quarterly basis. The Minister for Finance has explained this in the Budget. Unlike Workfare, Workfare was given for work done earlier. Workfare was paid after the work was done. In the case of Silver Support, we have decided to pay in advance. So, we are paying quarterly payments in advance. For example, in January, he will get the Silver Support for the next three months. I appreciate Mr Chen's point that if it is paid out monthly, hopefully that will help to manage their finance better. I agree. But on balance, between giving them the money in advance to facilitate better liquidity versus giving it monthly to enforce them to spread the spending over three months, I think, on balance, the decision on advance payment quarterly would probably be more beneficial, given the flexibility.

Mr Chen also asked whether we can adjust the payouts to adjust for inflation and so on. This scheme, when it is introduced in July this year, the total budget will cost about $320 million, which is not a small sum. I would say that we are very mindful of the sustainability of this scheme. Right now, there is no plan to go for this adjustment according to inflation.

Mr Chairman, I think I have covered most of the cuts raised by Members.

The Chairman: Thank you, Minister Lim. Just in the nick of time. We do have some time for clarifications. May I remind Members to keep your clarifications succinct and not to make speeches. Mr Patrick Tay.

Mr Patrick Tay Teck Guan: I thank the Minister and Ministers of State for their replies. I had in my cut earlier raised the plight of workers when companies are entering into liquidation, judicial management and various winding-up proceedings. I hope MOM would partner the other Ministries to look into and review this area to see how best we can provide more safety nets for our workers.

Mr Lim Swee Say: Mr Chairman, this question was raised by Mr Zainal Sapari to the Ministry of Law. I do not have the date, but I think it was in January 2016. At that time, the Minister for Law replied to Mr Zainal Sapari that when a company becomes insolvent, the proceeds from liquidation are preferably paid to employees who are second only to the liquidator.

MOM is committed to protecting the employment rights and interests of the workers, and the Ministry encourages all employees probably to seek assistance for unpaid wages as soon as possible before companies reach the stage of liquidation. From our experience, a majority of local workers do indeed file their claims before this happens.

The Chairman: Ms Jessica Tan.

Ms Jessica Tan Soon Neo: I would like to ask: since MOM is committed to letting workers work longer as long as they can and willing to, why not raise or remove the retirement age?

Mr Lim Swee Say: Mr Chairman, when I was at NTUC, this was raised by the workers many times as well. Each time we raised the retirement age or re-employment age, some workers would ask, "Why are you forcing me to work till an older age?" We explained to them that the purpose of retirement age, the purpose of re-employment age, is to protect the workers, give the workers the right to work. In other words, employers cannot simply "complete" the employment before the worker reaches the retirement age and now the re-employment age. So, if we were to abolish the retirement age, the question is, "What will happen?" Are we giving workers more protection or less protection?

Today, workers are protected under the retirement age of 62, re-employment age of 65, and by next year, it will be 67. I believe that if we were to remove retirement age completely, it will be less protection for the workers, rather than more protection for the workers.

The Chairman: Mr Melvin Yong.

Mr Melvin Yong Yik Chye: I thank the Minister of State for his concern and his personal attention to the rising number of workplace accidents and fatalities. I would like to ask what are the areas the Ministry will be focusing on in the coming year to further improve WSH standards.

Mr Sam Tan Chin Siong: Mr Chairman, I would like to thank the hon Member for raising this very important question. As mentioned in my speech just now, we are focusing on a four-pronged approach to tackle, reduce and, hopefully, eliminate the workplace safety fatalities and injuries. This is not easy. This is what we intend to do, that is, to raise awareness through a lot of media publicity and also public education programmes. Secondly, we intend to ramp up trainings and education for employers and employees. Thirdly, to step up enforcement, and, lastly, to stiffen the penalties.

We discovered in the last few years that there are three areas that constituted the highest fatalities: fall from heights where workers work at heights, workplace traffic safety and crane safety. This year, we will be focusing on these three areas because they constitute the most numbers of the workplace fatalities and injuries. We will work and step up and focus all our resources and manpower to deal with these three critical areas.

We also know that we need to go upstream to work with the companies and industries to introduce this idea called "Design for Safety" to make sure that when they start work or design something, they will always incorporate the ideas of workplace safety and health into the planning stage, so that, upstream, they will be able to do something to prevent and reduce the downstream fatalities and accidents at the workplace.

The Chairman: Mr Heng Chee How.

Mr Heng Chee How: Mr Chairman, still on this subject of retirement age. I agree with Minister Lim that the statutory retirement age works towards protecting the workers, giving them the right and peace of mind and confidence to work.

My clarification is on the other end of it. Although the statutory retirement age in Singapore now is 62, there are companies in Singapore today, for example, companies under the ComfortDelgro group which have done their own calculations and have implemented company policy to retire or offer retirement age above the statutory retirement age, that is, 65 or 67, and there are other companies in Singapore doing the same. That also then fits the company's or the industry's own realities and it offers the employees added assurance as well.

So, my question to the Minister is whether the Ministry would consider that this is an area where the tripartite partners can work together on, to widen their awareness of this possibility, so that all companies can look at their situation and avail themselves and their workers of this option and possibility?

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Mr Lim Swee Say: Mr Chairman, I agree fully with Mr Heng Chee How. When we prescribe laws and legislation, we are defining the minimum required standard. In other words, if any company were to behave in a way that goes below the stipulated requirement, then what they have done is illegal. Companies would have to comply with the law.

Having said so, our objective is to encourage as many companies as possible to do better than what is prescribed in the law. The example cited by Mr Heng Chee How is exactly what we call "progressive behaviours" which we would like to see more and more of in our industry.

In that regard, I fully agree with him that maybe TAFEP, as a tripartite alliance for fair and progressive practices can actually take on such a role to keep encouraging companies to do more, and MOM certainly will give our full support. And I thank him for his suggestion.

The Chairman: Assoc Prof Randolph Tan.

Assoc Prof Randolph Tan: Two questions for the Minister. One is on active intervention. The Minister had explained that the Ministry is taking in the labour market to deal with certain large numbers of cases of retrenchment where the Ministry has stepped in to match the cases of retrenched workers based on different initiatives that the Ministry has thrown up. I think that this is very good and I urge the Ministry to continue doing it. But in specific cases where his Ministry has identified gaps in the market, the reasons why the matching cannot take place, his Ministry has been able to plug those gaps. Will his Ministry, therefore, be seeing to it that the market can ultimately take on this role, such as HR agencies, can ultimately take on this role, so that the Ministry can continue to be active on other areas?

The second question really is to reflect my concerns that we should not let the pendulum swing to the other extreme and then see a certain wave of criminalisation of employers. I know that is obviously not —

The Chairman: Please keep your clarification short.

Assoc Prof Randolph Tan: So, my question is: are we going too far in the opposite direction?

Mr Lim Swee Say: Mr Chairman, I thank Assoc prof Randolph Tan for the two points. Firstly, on the issue of retrenchment, whether MOM is overly active in helping the retrenched workers. The answer is a yes. We are very active. For example, right now, whenever we receive a notice of retrenchment, a task force will actually move in. We will engage the companies and ask the companies to provide us with information of who are the workers, how many will be affected and, in terms of the job profile, how many are PMETs, how many are rank-and-file workers, and for each of these groups, what are the ages, background, and so on. And then, the other programmes will come in, like CSP, PCP and we will talk to the workers, introduce them to these schemes and bring them in. The objective is to help them to go back to work as quickly as possible, both the PMETs and the rank-and-file workers.

Increasingly, the job matching is going to go beyond WDA and e2i. Earlier, I mentioned that we intend to engage our Employment Agency industry more. Because we believe that they, too, can have a role to play. Progressively, we want to engage more of these private placement companies to be our partners, so that when there is a retrenchment exercise, especially for PMETs, we can get them to help us, too, to place them. I would say that, on the whole, maybe we are doing too much compared to many other places. But I must say that it is something which is very close to the hearts of the tripartite partners – NTUC, e2i and WDA. We do feel very strongly that whatever we can do, we must help them. The weakness in our market today is we feel that the employment agency market is not job seeker-centric and so, their objective is really to help the companies find workers. What we end up with is that the less employable workers are the ones who could end up taking a long time. That is why we want to make sure that we do our best to support them.

On the question of action taken, again, employers, whether we are swinging too much, I am very mindful of that. In fact, earlier in my address, I emphasised very clearly that as Singapore moves forward, we must both become even more pro-business as we become more pro-worker. The two have to be the two sides of the same coin. Because if we are pro-business and not pro-worker, we can have a strong economy but weak Singaporean Core. Or if you are too pro-worker and not pro-business enough, we can have a strong Singaporean Core but a weak economy. So, both ways will not enable us to succeed in our growth.

That is the reason why MOM is very mindful that we will always strike a balance between being pro-business and pro-worker. If there is a "triple weak", then there must be a "triple strong", and the two must go hand in hand. For the "tripe weak", so far, we are starting with only the outliers. In other words, we look at sector by sector. We look at each sector and we look at all the companies in the sector that employ EP workers and plot them in terms of their strength of their Singaporean Core. We can see a spread − industry norm somewhere in the centre, the "triple strong" on the extreme right, and the "triple weak" on the extreme left. What we are doing is that we are taking all these outliers, engage them and take action against them. Hopefully, by sending this clear messaging, the rest will start to gravitate more towards the centre over time.

We are very mindful that we have to strike a balance because, at the end of the day, if we swing too much to, as the Member said, against the employers, eventually we will be hurt. Because if Singapore loses its attractiveness as an investment location, eventually, we will run out of jobs for our workers.

The best way to be pro-worker is to be pro-business because a job is the best welfare; full employment is the best protection. At the same time, we must always be mindful that Singapore is not just an economy; Singapore is a nation.

I always remember what our founding Prime Minister Mr Lee Kuan Yew said. He said that in nation-building, we must have three pillars, and this is what we call the Singapore software. The first pillar is that our economy must always be competitive. Because if our economy is not competitive, all of us will be poor together. However, always be mindful that competitiveness in an economy is only a means to the end. The end objective is social progress and social well-being, and employment is the best way for our people to benefit in its progress. And lastly, he also mentioned the third pillar, and the most difficult pillar, is sustainable development. You can be pro-business today to ensure the economy is competitive. You can be pro-people, pro-worker today, to ensure the society will be cohesive, we will have social progress. But how do you strike a balance in such a way that we can sustain our development for the long term?

Every year, every three years and five years, when we adjust our Government policies, we are trying to define that balance. So, three years ago, there was no "triple weak" or "triple strong". Today, we have "triple weak" and "triple strong". Three years or five years from now, there could be something else, not because we have done something wrong in the past but rather because we keep striking that dynamic balance between the two.

I want to assure Assoc Prof Randolph Tan that I am very mindful of this and that I will always make sure that the interests of pro-business and pro-worker will always be harmonised and, hopefully, always strike the right balance.

The Chairman: I am going to take one more last clarification. Ms Sylvia Lim, can you keep your clarification short?

Ms Sylvia Lim: Thank you, Chairman. I have clarifications for the Minister concerning the response to workers who have been retrenched or made redundant. The Government is saying that the main strategy will be, of course, to match jobs to skills. We hope all the three will come together quickly for people who are retrenched. But, of course, that is always the case.

It may take time for the correct match to happen. At the same time also, some of these workers who may lose their jobs may actually have other possible options which are better. For example, he may have his own contacts to explore or he may want to become an entrepreneur and so on. I wonder if the Minister could give his views on whether there is still a place for some safety nets for these workers who may not fit so quickly into your schemes, such as PCP and CSP. In fact, these may not be the best thing for them. That there is actually a place, perhaps, for some safety nets for such workers in the form of some sort of redundancy or unemployment insurance.