Towards a Low-carbon Society

2.12 pm

Ms Poh Li San (Sembawang): Mr Speaker, Sir, on behalf of the Government Parliamentary Committee (GPC) for Sustainability and the Environment, I beg to move*, "That this House calls on the Government to enhance green financing, create more green jobs and strengthen corporate accountability, in partnership with the private sector, civil society and community, to advance Singapore's inclusive transition towards a low-carbon society."

*The Motion also stood in the name of Mr Gan Thiam Poh, Ms Nadia Ahmad Samdin, Mr Louis Ng Kok Kwang, Ms Hany Soh and Mr Don Wee.

This Motion builds on an earlier one which the GPC moved a year ago, on measures to accelerate efforts to mitigate and adapt to climate change. The House had a wide-ranging discussion on climate issues, viable policy changes and proposals and the trade-offs for our economy and jobs, among other concerns.

Since that debate, the Government had released the Singapore Green Plan 2030, launched new initiatives by the Green Finance Industry Taskforce (GFIT) and completed a study on establishing Singapore as a carbon services hub. Last month, in the inaugural Skills Demand for the Future Economy report, SkillsFuture Singapore identified job roles requiring green skills and curated the corresponding training courses.

Despite the enormous strain on our national resources to battle the COVID-19 pandemic, our Ministries and Government agencies have been pressing ahead to make the transition to a low-carbon society a reality. And I wish to take this opportunity to express our appreciation to the Ministries and agencies for their hard work during this very difficult period.

I am heartened by my fellow Members' support for mitigation measures and their commitment to sustainability. The green sector is developing rapidly in response to the climate emergency. Indeed, there are many new and exciting opportunities in the green economy, particularly in green financing and many new job roles in the sustainability sector.

On the other hand, the GPC is also concerned about the lack of standardisation in accounting standards and the problem of greenwashing. Hence, we are appealing for the firm hand of the Government to strengthen corporate accountability.

And central to our transition to a green economy, our priority is to ensure Singaporeans are not left behind as the world progresses towards a sustainable future and economy. We need to create fulfilling opportunities in a region with a growing sustainability sector and equip Singaporeans with the relevant skillsets and experience. We need to help our businesses get ahead of the curve in sustainability.

For today's debate, I would like to share some general observations on Singapore's green efforts and my views on green jobs. My fellow colleagues in the Sustainability and Environment Government Parliamentary Committee (GPC) will also share their concerns and recommendations in the three areas of green financing, green jobs and corporate accountability. Ms Hany Soh will join me in speaking about jobs in the green economy. Mr Don Wee and Mr Gan Thiam Poh will share their views on green finance and carbon trading. Ms Nadia Samdin will address the issues of green finance and challenges in Environmental, Social and Governance (ESG) auditing. Finally, Mr Louis Ng, will share his views on the carbon tax and the carbon net zero goal.

In addition, several members of the GPC for Trade and Industry will also be joining this debate. They will share the green aspirations, as well as the concerns from the business community. They will discuss how Singaporeans can seize opportunities in this new pillar of growth, the trade-offs between environment sustainability and economic sustainability, as well as the importance of upgrading skills and transforming jobs for inclusive transition to the green economy. Environmental scientist, Nominated Member of Parliament Prof Koh Lian Pin will also be speaking about the importance of carbon offsets.

Last Friday, the Young PAP (YP), published its second paper on climate change, entitled "Developing a Green Ecosystem". Many of us share deep concerns for our environment and for Singapore’s future. We hope to have the support of the whole House on this critical topic.

Before we all dive into today's debate, let us recap some facts to better appreciate the scale of this climate crisis. Let us reflect and take stock of the measures that have already been implemented, to set the context for a productive discourse.

Firstly, Singapore contributes about 0.1% of global emissions. Therefore, it may appear that any impact from reducing our carbon emissions is correspondingly limited. Notwithstanding, fighting climate change is a global effort and we should all continue to do our utmost to reduce our carbon footprint, as a nation, as organisations and as individuals.

The question here is whether we can make a bigger impact in the global community. How can we contribute more to the global efforts to reduce carbon emissions? And the answer lies in our role as an enabler, intermediary and facilitator. We can build on our existing infrastructure as a global financial hub, to serve the region as a green finance hub and carbon trading centre.

As a green finance hub, we will be able to bridge international capital with green solutions and innovations from different parts of the world, facilitating efforts to reduce carbon emissions far beyond our shores and in magnitudes way beyond our own. This is how we can punch above our weight and continue to contribute much more significantly to global carbon emissions reduction efforts.

Secondly, our two main greenhouse gas (GHG) contributors are from the industry and power generation, at 46.7% and 38.9% respectively. Manufacturing contributes 21% to our GDP, the largest sector by share and employs almost half a million workers. We are also the world's fourth largest global exporter of high-tech goods, producing five of the world's top ten drugs. Despite our size, Singapore is actually one of the world's leading energy hub and chemicals hub.

To cut industry emissions, the Government and the private sector will need to work together to help industries transition into the green economy, with customised solutions to address specific industry needs. For instance, Jurong Island oil hub will be transformed into an energy and chemicals park that operates sustainably.

Green technology will be vital in the transition to manufacture more sustainable products that are also produced with better energy efficiency. Green finance will be essential to fund these new technologies and businesses. With these new economic activities, there will be creation of new green jobs.

However, going green will impose additional costs to businesses. To sustain this green journey for the long haul, we need to strike a fine balance between environmental sustainability and economic sustainability. Different types of businesses will need different timeframes to transit and transform. Some businesses will need more time to deal with stranded assets as a result of the green transition. We need viable and progressive transition timeframes for businesses. Otherwise, if we set too onerous targets, certain industry players may actually relocate to other jurisdictions. Instead of creating more green jobs in these businesses, we may inadvertently shift existing jobs along with their carbon emissions to somewhere else.

We must also be mindful that for reasons of national strategic interests, we may need to continue certain critical activities which generate a substantial carbon footprint. One example is desalination which is rather energy-intensive. Unfortunately, we may have to make some painful trade-offs and sacrifices in order to meet our national carbon emissions commitment.

Thirdly, more than 95% of our power generation is from natural gas, which is still a form of fossil fuel. The reality is that Singapore faces severe constraints on the production of renewable energy. We have neither hydropower nor geothermal energy. Our wind speeds are not fast enough for wind turbines. We do not even have enough space to mount more solar panels. Even as we step up the installation of solar panels on rooftops and over water reservoirs, the solar energy we make will only meet about 3% of our total electricity demand in 2030.

In contrast, our neighbouring countries have abundant renewable energy resources. The Government is already working to import renewable energy from Malaysia, Indonesia and, further afield, Australia. If all goes well, we will get around 30% of our electricity from low-carbon sources by 2035. Indonesia, for example, will be a very valuable collaborative partner. It has already committed to making sustainable development a key focus.

Presently, renewables still comprise a small part of its energy sources at 11% and there is much room for its geothermal, hydropower, solar, wind, biofuel and biogas energy supplies to grow. It has set for itself the goal of almost doubling renewables in its energy composition to reach 23%.

Similarly, Malaysia plans to increase the share of renewable energy in its installed capacity to 31% in 2025 and 40% in 2035 under its power generation plan. Renewables now contribute 18% to Malaysia's energy mix, with hydropower accounting for 86% of its renewable capacity.

The Philippines has abundant clean and renewable energy sources, such as geothermal, hydro, wind and solar. Its National Renewable Energy Program (NREP) 2020-2040 has set a target of 35% share of renewable energy in the power generation mix by 2030 and 50% share by 2040.

There is much scope for our ASEAN neighbours to work together, pooling financing and engineering expertise to mitigate climate change. With our complementary strengths, we can work together to achieve our carbon commitments.

A few months ago, at the United Nations Climate Change Conference, COP26, consensus was finally reached on the set up of the international carbon market. The resolution of Article 6 of the Paris Agreement was critical. Countries will be allowed to trade emissions reductions as well as assist other nations in reducing emissions without trading. Private enterprises can invest in projects to sell green energy credits.

The resolution of Article 6 is extremely important to Singapore. This gives us a way out of our severe constraints in alternative energy. It means that we can use the international carbon trading framework as agreed at COP26, to purchase and offset our emissions, and tap into renewable energy positive resources in our neighbouring countries to meet our global carbon commitment. This will be a win-win strategy for alternative energy negative countries like Singapore and for developing countries requiring funds for renewable energy projects and for environment conservation.

Mr Speaker, Sir, I will deliver the next segment in Malay language.

(In Malay): [Please refer to Vernacular Speech.] At the recent United Nations Climate Change Conference, COP26, countries agreed that trading emissions reductions and providing assistance to other nations to reduce emissions, can count towards their carbon reduction pledges.

This framework will provide us with valuable opportunities to collaborate with our neighbouring countries to work on emissions reduction and building infrastructure for renewable energy. In doing so, Singapore will be able to fulfil our climate change obligations and help this region reduce its carbon emissions.

For these projects, very importantly, we need Singaporeans with the specific deep cultural and linguistic understanding of our regional partners to ensure the success and longevity of our transnational collaborations.

Hence, our national representatives working at every segment and level – project management, engineering, human resources, legal, and more – need to have the language skills and contextual understanding of how things are done in our neighbouring countries. Many new jobs will be created, not just high-tech green jobs, but also green collar jobs. So, there will be a strong demand for those who are willing to pick up the necessary skills for these positions.

(In English): I will now talk about green jobs and equipping Singaporeans to take advantage of opportunities in the sustainability sector. As we make the transition to a low-carbon society, almost all sectors will be affected and new green jobs will be created in finance, trading, technology and innovation, legal, engineering, governance, education and more.

The inaugural Skills Demand for the Future Economy report has identified more than 450 green job roles across 17 sectors, ranging from manufacturing and trade and connectivity, to financial services and the built environment.

Our education system will need to prepare and train Singaporeans and residents of all ages willing to learn in these areas. It is challenging, in this fast-evolving landscape, to draw up new and updated syllabuses, recruit and prepare the trainers and roll out high quality courses in a timely manner to meet industry needs.

Major updates and changes to course modules at our ITEs, Polytechnics, and Institutes of Higher Learning will be required. Green activities and projects should be integrated into all disciplines. Institutions can consider integrating modules that expose and equip students from different disciplines with skills sets relevant in the sustainability sectors. Arrangements for internships and apprenticeships in these sectors will have to be made, and these would require the support of both MOE and MTI.

The YP paper has proposed a Green Space Academy to groom local experts in research and development and technical experts, to sustain a pipeline of well-trained and specialised talents. This academy will take time to develop. In the short- to medium-term, the fastest way to roll out the training courses is to piggyback on our current education institutions. Modular courses will allow students of all ages to enrol and accumulate credits towards certification. This is flexible and inclusive, especially for workers looking to switch to careers to join the green economy.

We should consider borrowing from the German model, which is also being adopted by the Chinese government. Young Germans split their time between classrooms at a vocational school and on-the-job training at a company as apprentices. The participation by German companies is high – about 80% of Germany’s large enterprises. In October last year, China’s State Council issued a new guideline to have a similar arrangement to build a world-class vocational education system by 2035. For Singapore, we can implement a similar system, by creating very tight and dynamic relationships between education and training institutions, research and industry stakeholders.

We should also watch out for the workers, especially the older workers, who risk unemployment if they are unable to adapt to new positions or pick up new skills during the green transition. Many green positions, even green collar ones, may require IT skills which may be more challenging for our senior workers with lower levels of education. So, I urge Enterprise Singapore and SkillsFuture Singapore to work closely with the labour unions to equip senior workers with relevant skill sets for the green jobs, so as to minimise job displacements as companies transit into the green economy. Mr Speaker, I would like to address the next segment in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] The Motion calls for an inclusive transition to a low-carbon society and this must naturally include our SMEs – the backbone of our economy.

The Government launched the Enterprise Sustainability Programme (ESP) to support Singapore businesses on sustainability initiatives, and to capture new opportunities in the green economy. The S$180 million set aside for the programme aims to support at least 6,000 companies for training workshops, capability and product development projects, and key enablers such as certification and financing. My concern is whether this amount will be enough and whether our SMEs will be guided as to how to apply for and utilise this programme.

It was announced that the support will come on three levels - developing enterprises' capabilities in sustainability, strengthening sector-specific capabilities, and fostering a vibrant and conducive sustainability ecosystem. Many SMEs are struggling with day-to-day operations and trying to stay afloat. How will they know how ESP will be relevant to them? The Sustainability Experience Centre for SMEs sited at Nanyang Polytechnic is a good example of measures to reach out to SMEs and guide them with the green transformation of their operations. I hope more of such initiatives can be implemented.

I would also like to request that Government agencies be more open and allow SMEs to try out innovative solutions that can help reduce carbon emissions. For example, a network of shared and swappable batteries for electric bikes distributed across the island can be a convenient and efficient option vis-à-vis EV chargers solution. Such swappable batteries solutions such as Gogoro are already implemented in Taiwan and Israel and will be rolled out in Chinese and Indian cities this year. Such innovative and green solutions can help companies with a big fleet of motorbikes and self-employed delivery riders go green, without massive investments in motorbike charging infrastructure by the Government. We ought to be responsive and learn from the best green practices in other cities similar to Singapore.

Sir, in our journey to go green, we should be open and willing to give new solutions a chance. After all, acceptance of different ways to solving problems is necessary for innovation, which will drive our tech and development sector.

(in English): Mr Speaker, Sir, the transition to the Green Economy is like a fast-paced mass marathon. On one hand, we are racing against time to mitigate this climate emergency. On the other, we also need to sustain this transition over the long term. Most importantly, we must work together as a closely coordinated team, comprising the Government, civil society groups and the community, to develop a low-carbon and green ecosystem.

We hope to have the support of this House and Singaporeans to press ahead on this green journey together, to build a better Singapore for our future generations. Mr Speaker Sir, I beg to move. [Applause.]

Question proposed.

Mr Speaker: Mr Louis Ng.

2.36 pm

Mr Louis Ng Kok Kwang (Nee Soon): Sir, it is too hot and too wet! If you recall, this was what I said one year ago, when this House came together to declare climate change a global emergency. Yet, somehow, the world has become even hotter and even wetter. July 2021 was the world’s hottest month. Regions, from sunny California to snowy Siberia, faced their largest wildfires in history. The Arctic hit a record high of 38 degree Celsius. Catastrophic floods struck India, Europe, Malaysia, Australia and China. In China’s Henan province, a year’s worth of rain fell in a single day.

And it is not just heat and rain either. Extreme winter weather left nearly 10 million people in the US without power and water. It killed 318 people and caused nearly US$200 billion of damage, making it the deadliest and costliest natural disaster in US history.

The science is clear: climate change will increasingly usher in extreme weather and throw lives and livelihoods into disarray. As an open country, Singapore will undoubtedly be hit hard. This is a grim picture, and we are running out of time.

This is why my fellow GPC Members and I have returned to this House just one year later to call again for the Government to take further steps to tackle climate change, to sharply reduce Singapore’s carbon emissions and urgently move towards an inclusive low-carbon society. We are not alone in this fight.

As the climate crisis worsens, the people of Singapore have taken up the fight in their personal and professional lives. I shared the stories of some of these inspiring individuals in this House last year, including Esther, Lastrina, Xiang Tian and Wei Shan. I am happy today to share more about what they have done to further the fight against climate change, and I am happy they are up in the gallery, joining us in Parliament for this important debate.

Let me start with an update on Esther, the Chief Sustainability Officer of City Developments Limited. Last year, I shared how it really is not common to see a business leader advocate about climate change like she does and how despite all her time working with titans of the industry, her inspiration comes from youths. She continues to walk the talk. This past year, she attended COP26 in Glasgow as a private sector representative with our activists. At COP26, Esther proudly flew Singapore’s flag and spoke at the Built Environment Leaders Panel, a main stage event.

But it is not just at COP26 where Singapore’s activists and businesspeople stand together. Back home, Esther led CDL’s partnership with young activists from the Singapore Youth for Climate Action, or SYCA. Together, CDL and SYCA launched a campaign called "Keep Calm and Love Our Planet". Climate change can feel too big, too difficult a problem for the youths of the world. The campaign aims to dispel the sense of paralysis and instead motivate youths to take action against climate change. If you have not spoken to Esther before, I strongly encourage you to do so. She is a breath of fresh air, overloaded with enthusiasm and passionate about working together with our youths to save this planet we call home.

And this brings me to the young leaders at SYCA – Lastrina, Cheryl, and Swati, who Esther works closely with. Last year, I shared how Lastrina co-founded SYCA in 2015 to shine a light on what young people can do for the environment. Her message is one of empowerment. I am happy to share that SYCA celebrated their sixth birthday in November last year. With this milestone, other leaders have stepped up. Lastrina has empowered and inspired many others and this movement has grown.

Two of the leaders at SYCA are Cheryl and Swati. Passionate about fighting climate change, they attended COP26 as youth representatives. But their journey to COP26 was full of challenges, involving complicated logistics and fund-raising. Yet, their go-getter attitude exemplifies exactly what we want to see from our youths today. They shared with me that, to quote: "We are cautiously hopeful because we are see changing mindsets and positive actions all around us. We have seen our peers push for change and encourage positive impact through conscious food choices, recycling and sustainable energy use. There are students, entrepreneurs, teachers, artists and individuals in various professions among us who work tirelessly to achieve this. They inspire us to keep going and empower other individuals who have this shared vision of this world."

Last year, I also shared the story of Xiang Tian, a young man who leads LepakInSG, a youth initiative that circulates environmental events to motivate others to get involved. One year on, Xiang Tian remains optimistic about what we can achieve through collective action. He told me: "One thing that makes me hopeful is the increasing number of people who are learning more about the climate crisis and other environmental issues and taking actions to push for change."

In the past year, LepakInSG has been active on social media, explaining the important environmental impact studies and baseline studies we have done. Importantly, Xiang Tian is still doing this infamously in his slippers, although I am aware he is finally not wearing his slippers today. He sacrificed them to be able to enter Parliament.

Sir, Xiang Tian's work makes these complex but important topics more accessible to the public and makes it easier for the public to get involved, such as in consultations on land use and development plans. Xiang Tian tells me that LepakInSG has exciting plans coming up to facilitate discussions between green groups in Singapore. I cannot wait.

We are also very fortunate that at the PAP Youth Wing, we also have young activists working tirelessly on climate change issues. Wei-Shan is one such activist, leading a team of volunteers who are passionate about making a serious difference. We have been on many late-night calls with the YP team led by Wei-Shan. Last year I talked about the familiar sight of her two young children on our many Zoom calls. Like my daughters, they remain a regular and welcomed presence on our calls over the past year. Welcomed in most cases, except when my daughter Katie appeared completely naked when I was on a Zoom call listening to the Prime Minister’s National Day Rally live. I was horrified and I sure hope that no one, including the Prime Minister, saw.

Sir, Esther, Lastrina, Cheryl, Swati, Xiang Tian and Wei-Shan inspired us. Along them are countless other activists and citizens who have fought so hard against climate change in their own ways. Their call for action is loud and clear. I hope we can heed their call. In this spirit, I come to this House with three proposals: first, we should commit to achieving net zero emissions by 2050; second, we should increase the carbon tax to a price necessary to achieve net zero emissions by 2050; and third, we should expand coverage of the carbon tax to include all reportable facilities.

Let me start with my first ask. The Government should commit to achieving net zero emissions by 2050. I have pushed for this many times in this House now. Sir, 2050 is not just a random year. It is based on science; global emissions must be net zero by 2050 if we want to have any hope of limiting global warming to 1.5 degrees Celsius. Singapore’s current commitment is to reach net zero as soon as possible after 2050. This runs not just against what science say is needed, it runs against what many other countries are doing. Already, 136 countries have set concrete target years for carbon neutrality. This is 70% of all the countries. It includes nearly every developed nation in the world. Last year, the US, Australia and Israel also committed to reach net zero by 2050. What is stopping us?

I understand that the Government may want to focus on actions, not targets. And I do thank the Government for taking the right actions: releasing the Green Plan and for sharing how it will transform Jurong Island into a sustainable chemical and energy hub. But actions are motivated by targets. It will be harder to get to net zero by 2050 if we are not actually intending for that to happen.

In addition, setting a target in line with scientific and international standards set a strong message to Singaporeans. This would help the Government achieve what it says is needed: a whole-of-nation approach to climate change.

Last October, Minister Grace Fu said, “We will continually review and enhance our climate targets.” I thank the Government for its openness to revising its targets. Given the increasing severity of the climate crisis and the potential for sparking a whole-of-nation response, will the Government commit to reaching net zero emissions by 2050?

My second proposal today is that we increase the carbon tax significantly. There is no question that the carbon tax is the most powerful tool we have to slash emissions. Everything else – from green jobs to green financing that we are debating is important, very important. But the carbon tax has the highest potential to reshape incentives and motivate action. But our current rate is $5 per tonne. Finance Minister Lawrence Wong said last October that this is too low. I agree with him.

How high should it be to sufficiently slash emissions? One range from the High Commission on Carbon Prices, which is supported by the World Bank, proposed that US$50 to US$100 is needed by 2030. The IMF similarly recommends a rate of U$100 by 2030. Even higher prices have been suggested by LSE’s Grantham Institute, which proposes US$145 and the OECD, which provides a central estimate of U$147

My ask is that we look at the studies that have been done by these institutions and the principles for how they arrived at these prices. I hope we can adopt the principles and approaches to derive a price that Singapore needs to reach net zero emissions by 2050. An increase in the carbon tax will also mean an increase in tax revenue. I hope the Government will use this to help subsidise decarbonisation projects in the private sectors as well as limit the impact on lower-income Singaporeans by issuing more U-Save rebates or vouchers under the Climate Friendly Households Programme. Let us make this transition an inclusive one.

My third and final ask is that we expand the coverage of the carbon tax. Currently, carbon tax applies only to facilities emitting at least 25 kilotonnes of CO₂-equivalent in a year. This covers around 50 facilities that contribute about 80% of our total carbon emissions.

We should be aiming for a higher coverage. I understand that the Government set a high threshold to limit compliance costs by smaller emitters. But smaller emitters, those emitting at least two kilotonnes of CO2equivalent, are already “reportable facilities” and have to pay the costs of monitoring and measuring their emissions.

Given that any additional compliance costs would likely be minimal, it would make sense for the carbon tax to cover all reportable facilities. This would, after all, be in the spirit of a whole-of-nation fight against climate change. Emitters, small and large, have a role to play.

In conclusion, let me summarise my proposals: first, the Government should pledge to achieve net zero emissions by 2050; second, it should increase the carbon tax rate significantly; and third, it should expand coverage of the carbon tax to include all reportable facilities.

The fight against climate change must involve decisive action. On the matters of net zero targets and carbon taxes, we need to move much faster. I thank the Ministries and agencies for their hard work so far in helping Singapore play its part in the global fight against an existential crisis.

Sir, during last year's climate change Motion, I spoke extensively about how Captain Planet, that children's cartoon, motivated me to care more for the environment. Through that sharing, I learnt that many people did not know who on earth Captain Planet is and that I really am getting old. But I am glad many went to find out about Captain Planet and the important message of protecting our planet.

Sir, let me end with a quote from Gaia, the spirit of Earth in Captain Planet, and I quote, "The feeling that one person can't make a difference is the greatest obstacle of all." Small as Singapore may be, I hope we can all believe in her ability to make a difference in the global fight against climate change.

Mr Speaker: Mr Don Wee.

2.49 pm

Mr Don Wee (Chua Chu Kang): Mr Speaker, Sir, I would like to declare that I am working with a Singapore bank, but I am not involved in the issuance of green bonds nor green equities. I am also a council member of the Institute of Singapore Chartered Accountants (ISCA) on a pro bono basis.

Every region of the world has been hit by extreme weather events that are growing more frequent and more powerful. Our neighbouring countries have been impacted as well. These occurrences are the result of climate change from cumulative human-induced factors. And some of these changes – like the continuing rise in sea levels – are irreversible. Left unchecked, the interconnected crises of climate, pollution and biodiversity loss will rapidly erode the very foundations of our existence.

Since human activities have resulted in these changes, human activities can also slow down, halt or even, if we may dare hope, recede them. By reducing activities with heavy carbon emissions and through investments in green projects, we can strive to make changes for the better.

Green financing is an important enabler to catalyse the evolvement of our region's green economy. As one of the key financial centres in the world, Singapore has a strong responsibility to communities most vulnerable and existentially threatened by climate change.

Singapore can catalyse the flow of capital towards sustainable development in the region. We should continue to take the lead in mobilising climate finance from a wide variety of sources, instruments and channels, including instruments to unlock the huge potential of private finance through the targeted use of public climate finance.

Our financial services industry, which includes banks, insurers and asset management firms, can play a useful role in promoting sustainable and green finance in Asia, if not the world. Green finance, as one of the key programmes of the Singapore Green Plan 2030, can boost sustainability efforts in Singapore companies and compel companies to consider green projects more seriously.

MAS adopts an active approach in promoting sustainable financing in our financial services sector, including engaging financial institutions to consider environmental, social and corporate governance (ESG) criteria in decision making processes, supporting the adoption of industry standards and guidelines, encouraging industry-led capacity-building efforts and developing the green bond market in Singapore.

The Government can lead the way to promote sustainable financing by mandating its statutory boards, like MAS, LTA, HDB and NEA, to issue green bonds and laying the framework and rules for green financing. This is on top of the S$19 billion worth of selected public infrastructure projects identified to be financed by green bonds.

I hope our government can commit to a minimum number of green bond issuances every year, including a standalone retail green bond product which can be tied to the country's sovereign rating, so as to broaden the pool of Singaporean green investors. We should also tap into the growing investor demand across the globe for green financing products and projects with clearly defined environmental benefits.

The Government may consider reporting on the social benefits of expenditures financed by green bonds financing, such as job creation, access to affordable infrastructure and socio-economic advancement.

We can build on MAS’ Greenprint initiative and formulate a Singapore Green Financing framework which sets out the Government’s environmental agenda and its vision for enhancing Singapore’s leadership as the Asia’s green financial centre. The framework should detail how the proceeds from the green bonds will finance expenditures to help tackle climate change, biodiversity loss and other environmental challenges, while creating green jobs in Singapore. The sectors where we can make a difference include clean transportation, renewable energy, energy efficiency, pollution prevention and control, living and natural resources and climate change adaptation.

The Government should also perform annual allocation reporting and periodic reporting of metrics on environmental impacts and social benefits and ensure transparency for retail and institutional investors and other interested stakeholders.

Singapore is elevating the standards of emissions monitoring and reporting in Southeast Asia so as to help the large emitters in the region to curb their carbon footprint and increase their access to green financing schemes.

Singapore can take the lead to devise ASEAN’s version of the Action Plan on Financing Sustainable Growth and follow-up with a Strategy for Financing the Transition to a Sustainable Economy. Other areas we should look into include an ASEAN taxonomy for environmentally sustainable economic activities, sustainability-related disclosures for issuers and for financial market participants, the ASIAN green bond standard and corporate sustainability reporting which may also include carbon tax accounting especially when carbon tax is likely to rise in the near future.

To create a sustainable future for Singapore, we need all hands on deck. Every sector, business and individual need to play their part. In promoting the adoption of sustainable business practices and reporting, the trade associations and chambers, or TACs in short, can play a key role as enablers and strategic partners of the Government. TACs or professional bodies can partner the Government to support the sustainability agenda by providing resources to drive adoption of sustainability reporting and green finance.

Sustainability reporting is an emerging area, and companies will need references to guide them in their disclosures. With the introduction of the Singapore Exchange Regulation’s roadmap for mandatory climate-related disclosures, ISCA is also developing a series of guides to share best practices and guidance publications on green and sustainable finance. These publications include a roadmap to guide professional accountants on obtaining green and sustainable finance for their organisations if they assess that such financing fits into their corporate business strategy, and a best practice guidance on how businesses can disclose their green finance policies and initiatives. With such assessment, this will allow companies to better approach banks for the financing of their sustainability projects. It leads to a virtuous cycle of sustainability.

This is just one example of how a TAC can contribute to the sustainability agenda. Sustainability issues are inter-connected and multifaceted. I urge the TACs to collaborate and work together to impact all sectors of society as we progress in the Singapore Green Plan 2030.

To support Singapore's move towards a green economy, there is a need to equip the workforce with the skills and knowledge to participate in the sustainability sector. Citing the accountancy profession as an example, being stewards of capital and corporate reporting, accountants play a crucial role in accelerating business practices in sustainability. Therefore, increased participation by the accounting and business fraternities is key in Singapore’s bid to become a leading centre for green and sustainable finance in Asia and globally. Climate-related risk management is also an important skill to possess.

Accountants must be equipped to prepare sustainability reporting as more stakeholders and investors adopt environmental, social and financial performance metrics. Likewise, auditors need to get themselves ready to verify such information. Both accountants and auditors must step up to meet the market demands for sustainability reporting and the assurance of sustainability reporting. Beyond collecting, analysing and reporting sustainability-related information, accountants and auditors can be strategic advisors to help embed sustainability into a company’s strategy, decision making and reporting processes.

There is therefore a need for accountancy professionals to upskill so that they can fully inhabit their role in driving sustainability and meeting the rising expectations of businesses, economies and societies in this area. To engage the accountancy professionals, this is where we can involve professional bodies like ISCA. ISCA is the national accountancy body which has more than 33,000 professional accountants as its members. I understand ISCA has developed a sustainability reporting strategy which aims to raise the capabilities of the accountancy profession in driving sustainability. As part of its sustainability reporting strategy, ISCA will focus its efforts on capabilities development and career opportunities for the accountancy profession in Singapore. Given that sustainability is a new growth area and to equip Singapore Chartered Accountants with the necessary skill sets to flourish in this area, ISCA will be rolling out courses and certification programmes. This will include sustainability reporting and external assurance on sustainability reporting.

In development of such upskilling programmes, there will be significant content development involved. And to encourage more professional accountants to upskill and perform higher value roles, training grants can be made available to encourage employers to send their staff for training.

In this area, Government agencies such as Accounting and Corporate Regulatory Authority, Singapore Accountancy Commission and SkillsFuture can provide funding and grants to ease development costs and offset training expenses. This will greatly enhance the career prospects of accountants and contribute to Singapore becoming a sustainability accounting hub in Asia.

The Singapore Green Plan 2030 is expected to bring new career opportunities and economic growth. This has created vast job opportunities and new roles for Singaporeans, especially the accountancy and finance professionals.

To encourage accountants and aspiring accountants to take up sustainability-related roles, there can be greater efforts to raise awareness of the diverse roles in this aspect and to brand sustainability jobs as attractive career choices. For instance, ISCA also shared with me that they plan to profile their members who have taken on sustainability-related roles to showcase the emerging demand for such talents. They will also connect employers in need of sustainability-related talent with their members who wish to embark on this track.

Sir, the steps we need to take to transition to a green, low-carbon society may seem overwhelming as there are so many problems we need to solve along the way, but these challenges also present enormous opportunities and chances to make breakthroughs. I call upon all Singaporeans to work with us as we progress towards a greener, more sustainable future.

Mr Speaker, Sir, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] We do not want Singaporeans to be left behind as the world progresses towards a sustainable future and economy. We also realised that the Government needs to provide some help to local our businesses because this is a relatively new area, and the size of the start-up fund is not small. We hope to create fulfilling opportunities for Singaporean of all backgrounds in this new sector. Singaporeans should be brave and stand at the forefront, seizing these opportunities presented to them.

(In English): I support the Motion. Thank you.

Mr Speaker: Mr Liang Eng Hwa.

3.01 pm

Mr Liang Eng Hwa (Bukit Panjang): Mr Speaker, Sir, I thank Member Ms Poh Li San and the Members for tabling this Motion to debate on our actions towards a low-carbon society. I would also like to thank the activists from the Young PAP for their detailed and passionate proposal to mitigate climate change.

Sir, the Motion statement has thoughtfully captured the key thrust of efforts to transit towards a low-carbon society, focusing on creating green jobs, corporate accountability, partnership with the stakeholders and importantly, that this transition must be an inclusive one.

We are all aligned in recognising the severity of the climate change threat that is upon us and are mindful of the urgency of actions. Doing nothing or status quo is not an option.

As a responsible global citizen, we take our climate change commitments very seriously. But we also know that transiting to a low-carbon society is a mammoth undertaking, especially for a small, alternative energy-disadvantaged country with resource constraints like Singapore.

While we hope to get to the promised land in double-quick time, we have to also ensure that the stakeholders are all able to keep up with the pace, achieve the outcomes we set out to do and importantly, sustain high level of public support throughout this sustainability journey.

There will be pain-points and trade-offs that we will need to be addressed and for us as a nation to make, as a society as well and as individuals.

The obvious immediate concern of many businesses is the transition cost towards more sustainable and low-carbon business practices. This takes place against the backdrop of other worrying global trends, such as supply chain disruptions, protectionism and slower global growth.

As businesses look to lower their carbon footprint to meet the demands of their customers, or business partners or even their bankers, they may also experience higher capital outlay and operating costs, such as the need for mandated sustainability reporting, the requirements to adopt of low-carbon technology, or the use of greener but potentially more expensive raw materials.

Domestically, the source of higher cost pressures could also come from Government regulations, such as energy efficiency requirements and the carbon tax as Singapore strives towards more sustainable growth. Externally, as the world decarbonises, it can also lead to rising energy costs.

In the case of carbon tax, it is estimated that every $5 per tonne of carbon tax could lead to approximately 1% increase in electricity prices for households and businesses in Singapore. Businesses now need to ready for the next round of carbon tax increases, with the likely announcement at next month's Budget Statement by the Finance Minister.

Sir, while increased costs would be a concern, we cannot allow that to be the reason to slow our decarbonisation efforts. The higher near-term business costs may well be the necessary nudge needed for businesses to pivot, and when overcome, can enable these sustainable businesses to reap good returns and capture new and greater market share in the longer-term. Hence, it is pivotal that we closely support our businesses as they overcome the initial steep challenges in their transition journey to low-carbon practices.

Singapore has no domestic hinterland and we compete with the rest of the world to sustain our livelihoods.

In some markets and industries, we may also face competitive comparisons as a place to invest and conduct business, with competing economies who have fewer sustainability requirements or are less strict in their implementation.

The carbon tax is a case in point. We recognise that having carbon tax sends a clear signal that we are serious about decarbonising our industries and to become more energy efficient, and therefore spur the necessary industry transformation.

But on the other hand, the impact to our businesses would be that companies may be disadvantaged when competing with jurisdictions that do not impose such taxes, or provide exemptions for some carbon-intensive export-oriented sectors.

For example, some of these sectors in the EU, China and South Korea do receive free allowances under their emissions trading systems. And closer to home, in South East Asia, there are still economies who compete with us that levy no or lower carbon tax.

The short-term impact on business competitiveness and compressed margins may be inevitable. Businesses would need to rely on or strengthen their other competitive propositions such as quality and reliability to defend or grow their market share. But, in the longer term, sustainable businesses may have a competitive advantage as consumers increasingly demand sustainable products and services.

Sir, I support the imposition of carbon tax and to progressively increase over time to disincentivise the high carbon emission business practices. But we have to pace out the incremental increases so that our industries would not be dislocated and businesses can carry out the transition while staying as a going concern. It is also important for Government to be open about the timeline to increase the carbon tax so as to give businesses time to adjust. Inevitably, there will be businesses that may not be able to break even or cope with the carbon tax increases and may exit. We have to minimise such casualties and help as many businesses as possible to transit.

While the healthy tension by way of carbon tax is necessary to nudge practices, it must be complemented by support measures from the Government.

MSE Minister Grace Fu has indicated in an answer to a recent Parliamentary Question that the Government is prepared to spend more than it collects from carbon taxes on worthwhile projects that reduce carbon emissions. In the same reply, the Minister also mentioned about increasing funding support to assist industries in improving energy and carbon efficiency by way of the Resource Efficiency Grant and the Energy Efficiency Fund (E2F).

The Government is also working with companies based on Jurong Island to transform the island into a sustainable energy and chemicals park, and to develop and export the low-carbon solutions globally. For SMEs, they can tap on the Enterprise Sustainability programme to build capabilities for the green transition. These support measures and plans are useful. I urge the Government to continue reviewing these measures, taking in feedback from businesses and consumers, and enhancing the support where necessary.

Sir, the accelerating global momentum and traction on climate action creates new opportunities. A 2020 report by Bain and Company has estimated that ASEAN's green economy could be worth up to US$1 trillion in annual economic benefits by 2030.

There is an emergence of green growth areas, such as in electric vehicles, green financing and research and development (R&D) of the low-carbon technologies and solutions. Some of these areas are more developed, while others are more nascent. But these are all exciting areas.

Singapore needs to ride on this green wave to seize the economic opportunities and not be left out. As a country with limited resources, we need to identify the key strategic growth areas for Singapore that builds on existing strengths such as our position as a business and a financial hub.

There are also newer sectors that we can go into by leveraging our strengths in R&D. For example, R&D presents a pathway for Singapore companies to develop new capabilities, technologies, and innovative products and services in the green economy. Such solutions are particularly sought after in carbon-intensive sectors such as power generation, industrial processes, transportation and construction.

To seize green growth opportunities, it is important for the Government to support and partner the industries and businesses. We have done it before to grow globally competitive industries. We should and can do it again to grow a thriving Green Economy in Singapore.

Sir, as our economy shifts towards a greener one, new employment opportunities in the green economy will arise. We need to develop the talent pool for Singapore to remain as an attractive destination for businesses, especially for those who place a premium on sustainability.

The green economy was identified as a key growth area in the recent SkillsFuture inaugural report. It highlighted that today, there are more than 450 job roles in 17 sectors that require green skills, including manufacturing, financial services, trade and connectivity, hospitality, and the built environment. We can expect more jobs to be greener.

It is therefore important for the Government and businesses to help workers to equip themselves to take on these green jobs, whether within existing sectors or in new sectors. Time and opportunity cost on the part of the workers must be factored in to allow them to acquire the new skills and adapt to a greener business environment.

Mr Speaker, Sir, we need to press on with our efforts to transition into a greener Singapore that contributes meaningfully to the global efforts to combat climate change. There are pain-points we will need to address to ensure a smooth transition for businesses and people.

To do so, we need to pace out our green transformation and support businesses in their journey, seize the green economy opportunities, and equip our workforce with the skills to take on the jobs in the green economy.

Sir, with that, I support the Motion.

Mr Speaker: Assoc Prof Jamus Lim.

3.12 pm

Assoc Prof Jamus Jerome Lim (Sengkang): Mr Speaker, the process of moving from a carbon-based "brown" economy to a renewables-based "green" economy is one of the major challenges of our time, not just for us, but for our children and their children.

I agree that corporations have a crucial role to play in this transition and that the state and civil society, must be partners in the process. I believe, however, that the state must play a substantive leadership role and my remarks will address the various manner by which I believe it can do so as it guides the private sector.

Before I proceed, I declared that I am both a professor at a business school as well as the Chief Economist (Emeritus) of a wealth management advisory outfit, and occasionally speak on the topic of sustainable financing to audiences comprised of industry professionals and potential investors.

Sir, the celebrated management theorist, Peter Drucker, once famously quipped: "what gets measured, gets managed", or perhaps more pointedly in this case, "what gets measured, gets treasured". Now, even if one disagrees with the sweeping premises of either claims, it is probably fair to acknowledge that objectives that are subject to measurement, are more amenable to being targeted, whether in a practical or aspirational manner.

It makes inherent sense therefore for us to take more seriously the need to incorporate the core and the concept of natural capital into our national income accounts. Lest I be accused of introducing yet another annoying definition of capital to this House, I will start by emphasising that this concept is neither particularly novel – the term was introduced by German British statistician, E.F. Schumacher, in 1973 – nor especially controversial.

Simply put, natural capital refers to the stock of ecological assets such as fertile soil, forested land and coastal mangroves from which we receive essential services such as good harvests, clean air and water, and healthy fisheries. The term is now widely used across a number of disciplines, including anthropology, architecture, biology, geography, environmental science, economics, psychology and sociology; and the Prime Minister's Office – under the auspices of the National Research Foundation – has even supported an international collaborative project, entitled "Natural Capital Singapore".

While the measurement of a concept that encompasses typically non-market ecosystem services, such as the richness of subsoil from which crops may be grown, the natural resources from which so much of modern communications technology is reliant on or the potential pharmaceutical innovations that could be discovered in a biodiverse forest, or even the cultural heritage that we receive from our understanding of our embeddedness in our terrestrial, coastal and marine ecosystems. While this is challenging, such quantification is, in fact, not impossible, and the past decades have seen enormous advances in our ability to value natural capital.

In 2006, the World Bank launched the first of its reports aimed at measuring this natural wealth of nations. And just last year, the institution released its latest report.

Unsurprisingly, Singapore reports extremely low levels of natural capital. Of the $817,846 in per capita wealth, a miserly $62 was attributable to natural sources, both renewable and non-renewable.

While this should, perhaps, be unsurprising, given our surfeit of natural endowments, importantly, all of this accrues to renewable sources, which suggests that such capital can be protected, and perhaps even expanded, should we choose to do so. The vital need for us to preserve the little that remains of our forests, offshore fisheries, coastal mangroves, and protected land, rather than raze it all on the altar of urban development, is underscored by the recognition that we receive enormous benefits from natural capital, because properly accounting for natural capital alongside reproducible capital makes it clear that the former is a non-trivial contributor to the observed differences in the economic performance of rich relative to poor countries.

All nascent financial markets, and especially those in fixed income, benefit from the presence of a clear and trustworthy benchmark. This benchmark, more often than not, comes in the form of a government issuance. Here, it is worth thinking more carefully, therefore, about developing green financing. Of course, the Government has been proactive in its efforts to encourage the development of green bonds. The MOF established a Green Bonds Programme Office in September last year. A month prior, NEA became the first statutory board to issue medium-term notes under its Green Bond Framework.

These initiatives are important, and I hope that the Government will continue to look for opportunities to further catalyse sustainable investment efforts. In particular, I am hopeful that all Government agencies will look for opportunities to weave in green financing elements into their capital expenditure projects and to fund these green components proportionately. This will ensure that administrators have strong incentives to conceptualise projects with sustainability considerations in mind – the stated goal of the 2030 Green Plan – since additional financing pools may, in fact, avail themselves when they do so.

Moreover, I hope that the public-private partnerships (PPP) in green bond issuance goes beyond the current co-investment in debt financing platforms to entail actual green development projects, especially in infrastructure, as well as equity contributions and loan guarantees issued by Government developmental financing vehicles. This is truly where, in my view, the strength of PPPs comes into play.

To this end, I wonder if existing SINGA bonds will enfold green elements as well, and if so, whether this may mean a further expansion of the SINGA-related debt ceiling, and if there are plans for MAS’ Green Investments Programme to also include credit guarantees. Perhaps, more fundamentally, we must not expect sustainable financing to be a silver bullet that will, in and of itself, be sufficient for our efforts to resolve climate change. The estimated $500 billion in green bonds issued worldwide in 2021 is only a miniscule 0.4% of the $119 trillion global fixed income market. Our focus must remain on resolving environmental and climate change issues by dedicating real Government resources toward the emergency, rather than expecting financial markets to ride to the rescue.

Through all this, we should avoid the temptation to satisfy ourselves with feel-good actions that amount to little, insofar as their genuine environmental impact is concerned. The current affinity, and some would call obsession, for environmental, social and governance – commonly referred to as ESG – investments is a case in point.

The most common refrain seen in marketing materials for ESG is that by investing according to such criteria, one could "do well while doing good". This siren call is especially attractive to younger generations of investors, who both understand the critical import of long-term environmental sustainability, while simultaneously holding a deeply-felt desire to grow their money in a manner consistent with their conscience.

Yet the promise of many ESG funds may well be a Chimera. Not only do most ESG funds currently underperform a more mainstream index, many are expected to do so in future. Scepticism about the asset class is building, with at least one former ESG evangelist calling it a "dangerous placebo", while other observers fear that climate finance is now a financial bubble. Perhaps more critically, the underperformance of ESG relative to non-ESG investments is precisely the point. The converse of lower expected returns to green corporations is that brown corporations face higher costs of capital. And when capital is more expensive, these firms are likely to grow slower and, by extension, pollute less.

On the corporate front, we should likewise guard against claims by firms that proclaim environmental objectives but are only doing so for the veneer of sustainability. While it is impossible to perfectly police these so-called "greenwashing" attempts, Government should not be complicit in lending a stamp of approval to firms that are simply pronouncing adherence to such standards for the purposes of going through the motions or, worse, marketing reasons.

As an example, consider one of the more egregious examples of greenwashing, involving carbon offsets. In 2019, a ProPublica report examined the market for carbon offset credit – the idea this House will recall – that firms would purchase carbon sinks such as trees to counter the pollution they would be creating – and concluded that most programmes, while not always blatantly fraudulent in that they would actually set aside forest land, nevertheless contravened the ultimate purpose of the scheme, since a large majority of projects involved forests that were either already protected or would never have been cleared anyhow. The report concludes that, and I quote, our "hunger for these offsets is blinding us to the mounting pile of evidence that they haven't – and won't – deliver the climate benefit they promise" and that "carbon credits for forest preservation may be worse than nothing."

As an example, consider our current, single-stream recycling programme. While this approach surely encourages many to adopt a recycling habit, reports suggest that awareness of our recycling best practices remain low. The routine disposal of non-recyclable materials in our blue bins – such as styrofoam or plastic bags – is, I am certain, commonly observed by Members of this House during their estate walks. At best, this creates additional work for the conservancy contractors and at the sorting center; at worst, the contamination by food and liquid waste renders an estimated 40% of recyclables unusable. Further downstream, the practice of exporting recyclable waste runs the risk – as demonstrated by the Chinese treatment of most imported recyclables – of simply being redirected to foreign landfills. As of 2019, we continue to export a third of our recyclables, to an uncertain consummation.

As a third example, consider the booming market for sustainability bonds worldwide. Even as we enter into this market in earnest with our proposed exchanges, we need to guard against whether the ESG criteria are overly flexible, and, in particular, whether the ultimate rating ends up privileging the "social" or "governance" – the "S" and "G", respectively – rather than the environmental – the "E". This has resulted in dubious players issuing bonds under the rubric of sustainability, including a number of clean coal projects in China that were sold by Spanish oil company Repsol. The result is a loss of credibility and efficacy that could undermine the entire purpose of the exercise.

Mr Speaker, the purpose of these examples, which are just a few of many, is not so much to point to the possibility that green projects, operated in conjunction with the private sector, may turn out to be a marketing tool, without delivering on the intended environmental objectives. After all, corporations are primarily in the business of making profit, and market their goods and services in a way that enhances said profit as much as possible.

But just as Government plays a role in regulating false claims of efficacy in pharmaceutical products or imposes conditions to ensure product safety in food and children’s toys, it should also play a role in ensuring that claims on green practices are broadly justifiable, rather than claiming caveat emptor and placing the entire burden of verification on the shoulders of the busy and often underinformed consumer.

Alternatively, Government can operate in closer collaboration with non-profit efforts – such as the Green Label scheme under the National Environmental Council – to ensure that such labels do not become an unwitting tool of unscrupulous greenwashing attempts.

Regulation over misleading environmental claims is currently practised in Australia, Canada, the European Union, Norway and United States, to varying degrees. It is worth exploring if such regulatory moves are warranted here.

To this end, I wonder if the Minister will be willing to elaborate on regulation specifically targeted at greenwashing and whether there are such existing collaborative efforts with NGOs to account for greenwashing risks in environmental labeling.

Simultaneously, we could promote and develop a private sector that undertakes environmental audits, perhaps by requiring that listed firms, or firms that are among the major emitters, regardless of size, routinely report such audits, much like how we require routine financial statement reporting, albeit in this case, perhaps, with lower frequency. This would have the added benefit of creating green jobs for our next-generation economy. Having said my piece, I support the Motion.

Mr Speaker: Mr Gan Thiam Poh.

3.28 pm

Mr Gan Thiam Poh (Ang Mo Kio): Mr Speaker, Sir, let me declare my interest. I work in a financial institution.

We have all heard this phrase about the importance of finance – money makes the world go round. The Chinese has an even more imaginative phrase: 钱能使鬼推磨. Meaning that with the right amount of money, one can even get ghosts to work for you.

For the climate change crisis, we need to use all the tools at our disposal and, perhaps, the most powerful tool is the financial tool.

Appropriately structured financing can direct resources and efforts towards green projects and endeavours to mitigate climate change. As an international financial hub, Singapore will play a crucial role in ensuring financial flows from the public, private and not-for-profit sectors to our sustainable development priorities.

MAS launched the Green Finance Action Plan in 2019. The actions for six identified areas include setting Environmental Risk Management Guidelines for banking, insurance and asset management, grants for green loans through grants, committing US$2 billion to a Green Investments Programme, promoting fintech innovation, and supporting climate research and training.

MAS followed up with Project Greenprint in December 2020 to promote a green finance ecosystem by using technology to mobilise capital, monitor sustainability commitments and measure impact. Five months later, the Green Finance Industry Taskforce (GFIT) was set up to accelerate green finance by improving disclosures and fostering green solutions.

So, what more can be done?

Transparency in green finance reporting is vital. Corporates listed on the Singapore Exchange (SGX) are already required to disclose their environmental information through sustainability reporting, although as Singapore Exchange Regulation (SGX RegCo) and the Centre for Governance and Sustainability (CGS) noted, there is "ample room for improvement in the quality and depth of disclosures on quantifiable sustainability targets".

Indeed, such disclosures should not be marketing-style narratives of their green philosophy and policy statements. Outcomes and evidence of Environment, Social and Governance (ESG) impact, in addition to financial performance, consistency between policies and practices and supported analyses of asset-specific ESG risks should be quantifiable, verifiable and clearly presented in plain English.

All companies, not all listed ones, should have ownership of environmental management in their businesses and integrate sustainability into their business models. Would the Government consider standardised green certification for all companies?

The public will be able to view which product or service providers are awarded Green Certificates. This will be helpful information for consumers and motivate other companies to reach their desired green labels or targets.

Eventually, more and more enterprises will make sustainability an integral part of their businesses. Can the Government more organisational guidance and other forms of support to transition to green businesses, with courses for their staff to enrol in and linking them to relevant course enrolment websites, funding schemes and programmes?

It would be good to have a standardised nationwide ESG Rating Index and methodology for companies' green evaluation.

Financial institutions (FIs) can integrate sustainability into their business by making financing dependent on the implementation of social and environmental sustainability guidelines. This means that the banks will take economic, social and environmental issues equally into account. They should avoid financing projects that are harmful for the climate on the one hand and invest in climate change mitigation and adaptation on the other hand.

The Government can consider providing green finance participants with more incentives, such as tax exemption for qualified green deposits, bonds and funds. As green finance becomes increasingly mainstream, there will be a growing demand for retail products, such as green mortgages. Improved consumer awareness will give individuals greater agency in choosing these financial products. This will help stimulate demand for sustainable products.

The Ministry can also establish national or industry awards for corporate sustainability evaluations to provide awareness and recognition for green companies.

Lastly, regarding carbon tax. MOF had announced that they will be reviewing the carbon tax rate for 2024 which is expected to be higher than the $10-$15 range previously announced for 2030.

I hope more investment be made into technology with the use of the carbon tax to reduce, eliminate, capture and convert the carbon emission to improve the environment for us and the world and such technology shall be shared with all businesses, big and small, that produces carbon and operating in Singapore. The businesses shall be encouraged to continually look into sustainable and substantive solutions to the carbon elimination or conversion from bad to good and be rewarded for their effort and positive outcome.

The Government is still studying the use of high-quality international carbon offsets but to me, it is more important to reduce the emissions in the first place. I hope the Ministry can look into a system limiting the amount of offsets and providing incentives for the affected companies to adopt green transition processes and technology where available.

Sir, I will suggest that the Government could consider allowing the businesses to use carbon credit earned to offset the carbon tax imposed. With that, I support the Motion.

Mr Speaker: Mr Dennis Tan.

2.36 pm

Mr Dennis Tan Lip Fong (Hougang): Mr Speaker, nearly a year ago, this House acknowledged that climate change is a global emergency and a threat to mankind and called the Government, in partnership with the private sector, civil society and the people of Singapore, to deepen and accelerate efforts to mitigate and adapt to climate change and to embrace sustainability in the development of Singapore.

It could not have been timelier was we have seen more effects of climate change materialised over the last year. At home, intense rainfall events in 2021 led to heavy flash floods. In the region, the floods in Malaysia and Typhoon Rai have led to hardship and suffering to the affected communities. The events remind us that climate change is at our doorstep.

This year, in this Motion "Towards a Low-carbon Society", Members of Parliament on the other side of the aisle is calling on the Government to advance Singapore's inclusive transition towards a low-carbon society. This builds upon last year's Motion as there were measures discussed, such as enhancing green financing, creating green jobs and strengthening corporate accountability. We, the Workers' Party, do not object to these measures. However, I would like to push further.

Our inclusive transition also need to be just to address the unequal impact of climate change. I will ask that this Government throws its support behind a just transition, not just in words, but also in deeds.

What is a just transition? This idea is advanced by the International Labour Organization (ILO) as a process towards an environmentally sustainable economy which needs to be well-managed and contribute to the goals of decent work for all, social inclusion and eradication of poverty. To put this simply, it aims to address inequalities, such that no Singaporeans will be left behind and all can aim for a better future in the transition towards the green economy.

Lest some in this House think a just transition is mere window dressing and holds no direct relevance to us, this very term can be found in the preamble of the 2015 Paris Agreement, of which we are a party to. The relevant paragraph notes, and I quote, "Taking into account the imperatives of a just transition of the workforce and the creation of decent work and quality jobs in accordance with nationally defined development priorities."

If nothing else, our manpower and development policy should adhere to the spirit of the Paris Agreement by trying to stay in line with its goal of keeping global warming or limiting temperature rises to 1.5 degrees Celsius as we reaffirm by COP26 in Glasgow, last November. This means that we need to ensure that green financing is not just catered towards greening the sources of energy. It needs to create value for our labour force. We need to ensure that we can prepare those working in our high carbon intensive industries, particularly those in the the fossil fuel related sectors for new green jobs. We need to ensure that corporate accountability is not just about reporting their greening efforts, but how they are ensuring their own green transition includes bringing the many workers within and not lead to mass retrenchments.

A just transition also means that green finance should not solely be about capturing profitable opportunities in the green economy. It should also be offering those that are left behind by a green transition, the funding opportunities to adapt. They should concern those whose existing jobs and livelihoods are affected by transition, away from polluting industries, as well as those at risk of the direct impacts of climate change.

How do we achieve a just transition for all Singaporeans? This must be done in both words and deeds.

Here, I have a few suggestions for the Government to consider.

On words, I ask that the Government review the COP26 just transition declaration and consider supporting the said pledge and efforts, putting social dialogue as well as rights at work at the centre of policies for strong sustainable and inclusive growth and development for our workforce. And a commitment to this will give impetus to focus societal efforts on combating the global emergency, that is, climate change.

This pledge also looks at supply chain development. Singapore, as a shipping and logistics hub and a commercial centre, can and should play an important part in the global supply chain screen. transition.

Second, on deeds. The average Singaporean worker must not only hear that we are doing the right thing but also sees the concrete benefits from this move towards a low-carbon sustainable economy.

Clause 29(b) of the ILO's just transition guidelines also ask that governments, in consultation with social partners, and I quote, "Give particular attention to unemployed workers and workers at risk of unemployment in communities and industries affected by climate change, resource degradation or structural change, including those in the informal economy."

We need to help Singaporean workers in sectors who are being affected or will soon be affected by developments in the green economy. We need to look at how to prepare Singaporean workers to go into jobs, which will be created in the green economy.

Therefore, I ask that the relevant Ministries and Statutory Boards work on a just transition roadmap for Singaporean workers which can be at risk of displacement as the green economy develops. We should prioritise a roadmap for carbon intensive industries, such as petrochemicals and power generation. We can also look at ensuring a just transition for the labour force. For secondary industry, they are carbon intensive but are already taking active and laudable steps to adopt less polluting technologies, such as transport, shipping, logistics in the supply chain. Mr Speaker, I declare my interest as a shipping lawyer.

We should also consider a just transition roadmap to get our financial professionals to take on nascent green financing roles where there are growing opportunities. Such a just transition roadmap must be a key complement to the Singapore Green Plan 2030 on the green economy and be executed upon. This will ensure that value is not just accrued within businesses only but an equitable share of the value created will directly benefit Singaporean workers.

We can also kickstart stronger efforts on green upskilling. My Parliamentary colleague, Mr Gerald Giam, has previously called for extending the Special Employment Credit scheme to provide time-limited wage support to all Singaporeans workers while taking up their first job in the green economy. I wish to reiterate this call. In the vein of ensuring our talent pipeline remains robust, I also ask that all our agencies ensure their future upskilling programmes and career conversion programmes are created for and geared towards the green economy we aspire to, so that the value of the green economy can be directly captured by Singaporeans, both present and future.

All these may require funding of course and the Workers' Party has welcomed carbon taxes. However, we will need to consider funding mechanism to properly channel carbon taxes towards a just transition measures. Here, the Government can take reference from the EU's just transition mechanism, which includes a just transition fund offering financial supporting and technical assistance for most affected communities, such as low-income communities.

Mr Speaker, let me conclude. We, in this House, have seen robust exchanges on Motions surrounding climate change and jobs. We have the opportunity here to hit two birds with one stone. Let us not waste it and seek a just transition for all Singaporeans workers in the greater future we seek to achieve. Mr Speaker, I support the Motion.

Mr Speaker: Ms Foo Mee Har.

3.44 pm

Ms Foo Mee Har (West Coast): Mr Speaker, before I start, I would like to declare my interest as council member of the Singapore Business Federation.

Sir, businesses have both a responsibility and an opportunity to proactively commit to decarbonise. The impact of climate change and the opportunities presented for a green and sustainable economy have never been more urgent. Whilst sustainability efforts amongst companies in Singapore have gathered pace, the lack of understanding of sustainability and related concepts has been a barrier to galvanising strong action.

During the recent Ecosperity Week held in September last year, it was revealed that some 250 chief executives of firms who have made net-zero commitments are unsure of how to reach their goals. From inconclusive measurement, reporting and verification (MRV) standards to a lack of agreement in defining sustainability performance, business leaders urgently need a framework to navigate their firms through these challenges.

There remain many companies, especially our SMEs, who have yet to come on the green economy bandwagon. Many consider "sustainable" practices as "regulatory" requirements. They lack the understanding of its impact on their business and how to make the green transition; yet this is one of the most significant business opportunities that they can tap for business growth.

Certain industries may need additional support to spur decarbonisation ahead of others, in anticipation of carbon border taxes such as the European Union’s Carbon Border Adjustment Mechanism which puts carbon prices on imports into EU.

Given SMEs’ critical role in supply chains, we can boost their transition on three fronts: first, we can promote sector-based sustainability road maps with industry-aligned principles, frameworks and uniform standards; second, we need to support SMEs with pre-identified sector-based green solutions to fast-track adoption; third, we can leverage the ecosystem to build scalable green capabilities and collaborations.

Sir, to catalyse transition, SMEs should be supported by Government grants designed specifically for a range of industries, taking into consideration the limited scale and resources firms have in making the transition viable.

Speaker, a carbon tax assigns costs to planet-warming emissions and forces companies to consider the cost of pollution and environmental harm. Finance Minister Lawrence Wong has indicated that Singapore’s carbon price is too low and will be up for review. I wholeheartedly agree. Our current carbon pricing at the rate of S$5 per tonne of emissions pales in comparison to other jurisdictions, falling far short of the recent IMF’s guidance of US$75 or S$100 per tonne of emissions for advanced economies. This is about 20 times our current rate.

Whilst the plan to increase carbon tax is imminent, we need to carefully calibrate the increase and consider the trade-offs. Too low, we fall short of our commitments in making a viable impact to nudge firms in the right direction. Too high, we risk firms passing on cost increases to consumers and end users, or worse still, moving business activities to countries with lower sustainability requirements and carbon pricing.

Speaker, Sir, the carbon tax in Singapore applies to approximately 30 to 40 companies. These high emission firms such as power generation and petrochemicals directly employ over 27,000 workers and constitute 3% of Singapore’s GDP while providing business activities for a host of other sectors.

While these firms need to pay their fair share, there are some who are already pivoting their business activities towards low-carbon solutions in Singapore. For example, in 2020, Shell Singapore announced a 10-year plan to cut down local emissions by a third by the next decade. Similarly, ExxonMobil collaborated with local Universities in launching the Singapore Energy Centre, forming centres of excellence in research and innovation to solve technological gaps amongst industry players. There is opportunity to work closely with such firms to co-create a sustainable future, helping transition high emitters of yesterday into green industry leaders of tomorrow, here in Singapore.

Whilst Singapore’s headline amount of S$5 per tonne of emissions is low – it is low – but it covers 80% of local emissions with no offset provision. In Southeast Asia, Indonesia is the only country other than Singapore which has announced concrete plans to introduce a carbon tax, at a minimum rate of US$2 per tonne of emissions only from 2022. Trade-exposed sectors in the EU, China and South Korea receive free allowances under their emissions trading systems.

Speaker, Sir, whilst reviewing Singapore's model, we should note that there are more than 60 different carbon pricing initiatives worldwide. Each regime adapts to different strategies based on its own goals and constraints. Whilst Singapore can learn valuable lessons from other jurisdictions, we need to develop our own unique playbook for carbon pricing and ensure any change is set and paced carefully to avoid dislocating our industries or losing our attractiveness as an investment location.

Sir, we must recognise that any increase in carbon tax will result in an increase in operating cost, directly impacting the largest upstream emitters as well as indirectly impacting downstream users such as increases in electricity production costs, that will likely be passed on. For instance, the Singapore Business Federation expects that carbon tax increases will impact the manufacturing sector hard, as utilities can comprise up to 9% to 10% of operating cost. Given the rising cost of labour, freight and raw materials, any further increase in operating cost in the near term will adversely impact many companies already struggling in the current economic conditions.

Currently, Singapore’s carbon tax does not apply to imports. This puts local SMEs in a disadvantaged position as Singapore embraces more advanced integration of sustainable practices at increased costs, affecting these companies' cost competitiveness relative to peers in the region. To cushion the impact, the Government should consider channelling part of the carbon tax revenue to subsidise the increase in cost for a specific transition period, as well as provide subsidies to adopt green technologies to spur companies towards green practices and reduce use of energy.

Finally, I call on the Government to ensure that the businesses are provided ample lead time on the implementation of any new carbon tax rates, giving them time to adjust, whilst sending a strong but positive signal for companies to adapt and pivot. One good example is Sweden, which oversaw three decades of phased implementations before reaching its current pricings, without hemorrhaging economic developments. So, Sir, a clear long-term trajectory of the expected changes to carbon tax will be key to Singapore, to help companies make the business case to adopt new green technologies and make the necessary investment. With that, I support the Motion.

Mr Speaker: Prof Koh Lian Pin.

3.53 pm

Prof Koh Lian Pin (Nominated Member): Mr Speaker, Sir, please allow me to declare my professional interest as Director of the Centre for Nature-based Climate Solutions at the National University of Singapore, and a member of the International Advisory Council of Climate Impact X.

Many businesses have shown increasing interest in improving their environmental, social and governance performance. In particular, they want to reduce greenhouse gas emissions in their value chain, to meet carbon neutral or net-zero emission goals.

However, many businesses are also finding it difficult and challenging to completely transition away from fossil fuels by mid-century. Mr Sunny Verghese, the CEO of Olam, made a telling remark during Temasek’s Ecosperity Week in October last year. After speaking to over 200 fellow chief executives who have made net-zero commitments, Mr Verghese realised that most of them may not know how to get there.

So, while it is important to set ambitious targets for a low-carbon society, it may be even more important to develop and execute the strategies, policies and actions for us to achieve these goals. That is what this Motion is calling for and why I fully support it.

Sir, we need to take concrete steps to decarbonise. This will include putting an appropriate price on carbon to internalise the social, economic, environmental and climate costs of carbon emissions, as my fellow Members have highlighted. At the same time, there is growing recognition that carbon offsetting may need to be part of our immediate strategy as we transition to a low-carbon society.

What is carbon offsetting? In a nutshell, it is a way for companies or individuals to invest in value-adding environmental projects to balance out their own carbon footprint.

Carbon offsetting as a concept may present various technological, political and ethical conundrums. But insofar as decarbonisation remains the top priority and effective guardrails for carbon offsetting are in place, certain types of carbon offsets are not only viable, but may be indispensable, for us to meet our climate goals.

A carbon offset credit is a tradable certificate or permit that represents the allowance to emit one tonne of carbon dioxide, or equivalent greenhouse gas. These carbon credits can be produced from different types of clean technology projects, emissions reduction projects or carbon capture projects, including both technology-based and nature-based solutions.

Nature-based carbon projects are important because they represent low-hanging fruits for us to immediately turn off one tap of our carbon emissions by ending deforestation and start to remove carbon dioxide from the atmosphere through reforestation.

And that is not all. Nature-based carbon projects, such as mangrove conservation and restoration, can also deliver many other benefits for local communities and biodiversity that are well-aligned with the United Nation’s Sustainable Development Goals.

Sir, as a city-state, Singapore faces the geographical constraint of limited land and coastlines for implementing nature-based projects at scale. But by the same token, we have the good fortune of being geographically situated in a region with bountiful opportunities to work with nature in our fight against climate change.

In fact, there are at least 160 million hectares of investible, carbon-rich forests across Southeast Asia that could provide an annual supply of some 400 million tonnes of nature-based carbon credits, if they came under protection as carbon projects.

I believe we have the ability and responsibility to work across sectors, nations and generations, to realise these opportunities and to help us transition to a low-carbon society.

Perhaps a more pertinent issue is to ensure that carbon offsetting will actually deliver the benefits it promises.

Indeed, there are concerns about the lack of transparency in the global carbon marketplace today, in terms of the quality and pricing of carbon credits. This has posed a deterrent to both buyers and producers, and created a bottleneck to both the demand and supply of nature-based carbon credits.

More importantly, we need to ensure that carbon offsets are not being used for greenwashing to create a veneer of sustainability, as fellow Member Assoc Prof Jamus Lim pointed out. There is always the risk that some companies or individuals might buy up carbon credits for environmental claims, without actually making any effort to reduce their carbon footprint. Therefore, we need to hold to high standards of accountability, both the buyers and producers of carbon credits.

On the supply side, we need to ensure that carbon projects deliver real, additional and permanent benefits, not just for climate change mitigation, but also for communities and biodiversity on the ground. On the demand side, we need to ensure that users of carbon credits have in place, concrete policies, plans and actions to transition to a lower carbon economy, and are not relying solely on offsetting to reduce their net carbon emissions.

In May 2020, Deputy Prime Minister Heng Swee Keat set up the Emerging Stronger Taskforce (EST), led by Minister Desmond Lee and Mr Tan Chong Meng. The EST convened several Alliances for Action (AfA), which represent a new form of private-public partnership with a strong bias towards action in capturing new opportunities. And capture new opportunities the EST did indeed. The AfA on Sustainability was prescient, in anticipating the need for a trusted platform, that would provide transparency in carbon trading for businesses to support nature-based carbon projects. This led to the establishment of Climate Impact X, a global exchange and marketplace for high-quality carbon credits, through a partnership between DBS, SGX, Standard Chartered and Temasek.

Who would have thought that one day, Singapore’s most important financial institutions – the engines of our economy – will play such an important role in the conservation and restoration of our natural environment? So, we are capable of thinking beyond the dichotomy of economic development versus environmental protection. The tension between these and other societal priorities will likely remain. But this constant tension can be helpful in reminding us, that in our transition towards a low-carbon society, no one succeeds until everyone succeeds. Sir, I stand in support of this Motion.

Mr Speaker: Order. I propose to take a break now. I suspend the Sitting and will take the Chair at 4.25 pm.

Sitting accordingly suspended

at 4.02 pm until 4.25 pm.

Sitting resumed at 4.25 pm.

[Mr Speaker in the Chair]

Towards a Low-Carbon Society

Debate resumed.

Mr Speaker: Mr Derrick Goh.

4.25 pm

Mr Derrick Goh (Nee Soon): Mr Speaker, Sir, experts noted that the recent COP26 Climate Conference to secure a net-zero carbon footprint fell short of actions but help move the world forward. In Singapore, a Clean and Green Global City has always been a national focus since our founding as a nation. We have been doing our part such as setting up a Climate Action Package in 2018 and more recently, putting forward the Singapore Green Plan 2030 which we discussed in this House.

In joining the debate on this Motion, there are two key areas I would like to touch on: one, factors to consider in our Green transition plans; and two, seizing opportunities in the Green economy. These are areas that will pave a clear glide path in our journey towards achieving our net-zero ambitions and eventually set a time-bound commitment, along with strengthening our position on climate leadership.

Key to an effective green transition is about having a good implementation plan. This requires a clear-headed recognition that a greener world and Singapore will come at a cost. Therefore, we need to navigate this well. It was apparent at COP26 that such trade-offs are not easy to make and Singapore will face similar challenges in our transition journey.

A good implementation is about our Government leading these efforts which are effective in reducing real carbon footprint and done smoothly, so that the unintended effects on our society are mitigated. A holistic plan would entail: one, a balanced approach in carbon pricing; two, eliminating the regressive effects; and three, accelerating efforts on identifying enablers, which is about stepping up awareness and education on carbon emissions and greener alternatives.

As we transition towards a green economy, the immediate concern of many households and businesses is about having to bear higher costs to adopt more sustainable and low-carbon practices. This will be taking place against the backdrop of other forms of global trends that is driving cost increases, such as supply chain disruptions, a topic we debated passionately about.

As businesses look to lower their carbon footprint to meet expectations of stakeholders, they will experience higher operating costs and capital outlay. Domestically, higher costs can also arise from changes in regulations, such as energy efficiency requirements and the Carbon tax. Externally, as the world decarbonises, energy costs will rise.

Given this, the implication is not to stop or slow down our decarbonisation efforts but to ensure that we provide support to households and businesses in their journey to become more sustainable. As such, with the impending revision of Singapore’s carbon tax regime, the Government should adopt a balanced approach to carbon pricing with subsequent increases paced.

While a higher carbon tax can drive reductions in carbon emitting activities, it is important that Carbon pricing be tiered to match against the greener alternatives available or abatement efforts. This is to allow households and businesses in particular SMEs, to make rational transitions. Higher businesses costs could be temporary during transition and eventually make our businesses fitter in the longer term. But transitions do take time, and our Government could consider adding "carrots" as part of a total package over and above the tax regime, such as Green rewards or financing incentives for households and businesses to accelerate behavioural changes.

As carbon taxes can have regressive effects on the vulnerable segments of our society who spend a higher proportion of their income on basic services such as electricity bills, such negative effects need to be addressed. I hope that as a higher carbon tax is being contemplated, the Government can provide some assurance that relief will be granted in the same way we cushion for GST increases.

Singapore’s transition plan towards a low-carbon society should be an inclusive one. If we are to achieve a greener way of life, it is important to scale up awareness and educational programmes for households and businesses. This enabler is key to move from rhetoric of mere targets to real actions.

Many initiatives we do today, such as our Smart Nation or Zero-Waste Nation programmes, fits nicely into our green movement. Such programs reinforce our green efforts, such as accelerating digitalisation, will lead to a paperless society and reduced waste will help go towards reducing carbon footprint.

There is scope to create more awareness on enablers as well as actionable steps to galvanise actions. Shopkeepers and residents in our neighbourhood want to be green and want to know how much carbon they produce. This is where Government can help facilitate through sharper awareness programmes, through providing carbon footprint calculators and alternatives to facilitate individual action.

Given the global urgency to act quickly for a net zero carbon future, Singapore can and should seize the exciting opportunities that exist before us. We can improve the lives of our citizens and contribute to the global good along with creating new business opportunities.

As an international services hub for finance, consulting, accounting, trading and legal amongst others, we are well-positioned to help the region and the world. This will also create many exciting green business opportunities.

It is often said in business, what you want to manage, you first need to measure. While this is a critical step, the task of any company to determine its baseline carbon footprint or emission is not easy, even for a sophisticated corporate. The Greenhouse Gas Protocol requires the measurement of not just this but also the indirect emissions from a company’s activities known as Scope 2 and from the value chain known as Scope 3, which is even more complex to measure. What I am saying is that measurement is not easy and companies here and the region will need expertise to get this done.

Financial services is also an area where Singapore can make an impact. Investors globally have demonstrated willingness to offer loans at favourable rates while demand is also set to increase as organisations look to also finance decarbonisation efforts and projects. This demand will spur the supply and diversity of products in the international financial marketplace, such as sustainability linked loans, green bonds, green investment funds, as well as transition financing to support decarbonisation plans.

Another key opportunity will be for Singapore to position itself as a carbon services hub. Even though carbon credits are recognised as part of the climate solution in the Kyoto Protocol since 1997, in reality, the Voluntary Carbon Market (VCM) is still at a nascent stage. Today the carbon markets globally remain illiquid and fragmented as they face challenges such as the lack of strong governance, differing standards and grey areas such as the verifiability of projects. These impact market confidence. Market participants wonder if the carbon credits purchased really deliver carbon reductions.

As such, the opportunities before us are real given the pent-up demand. I believe this is where Singapore can play a distinctive leadership role as a trusted global financial and services hub with strong regulatory regime, market infrastructure and services sector expertise. Our brand name for excellence will provide us the platform to create a carbon services hub where participants can buy and sell carbon credits that are of integrity. This would mean the need for an ecosystem such as carbon accounting and Monitoring, Reporting and Verification Services (MRV) here and in the region.

In Singapore, there will be a need for more professionals in a carbon services hub ecosystem. This will spur our services sector to leverage existing skillsets in areas such as trading, product structuring, measurement and certification to apply in the carbon space to support clients in their decarbonisation efforts. All these will lead to the creation of new jobs in Singapore and in the region.

As such, I am glad that the Government is exploring the use of carbon schemes such as the enablement of large carbon emitters in Singapore to purchase high quality international carbon credits to offset their liabilities. With innovative solutions, Singapore-based international carbon exchanges can also participate in this transition which has other spin-off benefits like spurring greener projects such as R&D in clean hydrogen, developing carbon sinks and clean energy farms in the region.

Mr Speaker, Sir, in summary, Singapore is well-positioned to contribute towards a greener future to help achieve our net zero ambitions on carbon. We can achieve this by implementing measures in a balanced approach. Transitions will require sacrifices and trade-offs by individuals and businesses, but the positive impacts created and the opportunities that can be seized will be bountiful. In addition, the future is an exciting one as there are many green growth opportunities for Singapore to scale while at the same time riding this wave to drive economic growth.

Mr Speaker: Mr Gerald Giam.

4.37 pm

Mr Gerald Giam Yean Song (Aljunied): Mr Speaker, combating climate change is the challenge of our generation and quite possibly, the next two generations. If our generation does not set in motion sufficient changes to mitigate climate change, our grandchildren will pay a painful price for our lack of resolve and action. It will be infinitely harder for successive generations to reverse the impact of global warming, even if they try their best to. It is therefore incumbent upon our nation and the world to rise to meet this challenge.

Singapore has in the past approached climate action as a small nation which is unable to make much impact on the vast world. This approach has thankfully evolved in recent years. Nevertheless, a greater resolve in our outlook towards this challenge is needed. We are still constantly reminding ourselves that we are a small country with inherent limitations as to what we can do to reduce emissions. We wave the flag that our alternative energy disadvantage status is officially recognised by the United Nations' Framework Convention on Climate Change.

Certainly, these are realities that we cannot run away from. However, we must not, in our attempts to temper expectations, allow these mantras to limit our imagination and innovation.

Decarbonisation within Singapore's boundaries is important. However, carbon dioxide does not respect national boundaries. Arguably, the biggest impact that Singapore can have on averting climate change, and hence saving ourselves from the harm that global warming will do to us, will come from test bedding and developing new green technologies and sharing these discoveries with the rest of the world.

Making low-carbon technology widely available at a reasonable cost will be critical to spurring industry adoption and helping the world to achieve net zero carbon emissions. We may be small, but that does not prevent us from working around our constraints of a small land area, high urban density, hot tropical weather to innovate solutions that could mitigate climate change in an increasingly urbanised world. Our constraints can actually be our comparative advantage over other nations.

Our green inventions could spread far and wide beyond our shores to benefit the rest of the world. Climate change is global. We should therefore aim to make a global impact in our climate change efforts. We should be prepared to make big investments in emerging green technologies and in doing so, take decisive steps towards wielding the mantle of climate leadership.

In my speech today, I wish to focus on a few of these green technologies and how the Government can play a bigger part to drive their adoption.

First, the transport sector, which is one of the biggest emitters of greenhouse gases in Singapore. Singapore plans to phase out internal combustion engine (ICE) vehicles by 2040 and replace them with electric vehicles. Almost all the current plans for the rollout of EVs focus on battery electric vehicles (BEVs). However, it may be risky to place all our bets on BEVs.

For starters, it is still unclear whether we will have the infrastructure to handle an all-BEV fleet of vehicles once ICE vehicles are fully phased out. A study by KBR, commissioned by the National Climate Change Secretariat, estimated that approximately 164,000 publicly available BEV chargers will be required for a 100% BEV scenario. Singapore plans to roll out just 60,000 BEV charging points by 2030. This will equip only about 6% of public carpark lots and 3% of private carpark lots with charging stations. Given that it takes anywhere from 30 minutes to six hours to recharge a car, and assuming people charge their cars only once every five days, my calculations indicate that the infrastructure will support only about 30% of cars in HDB estates and 15% of cars in private estates each night.

I am, in fact, making optimistic assumptions about driver behaviour. In reality, range anxiety will dictate that drivers will avoid waiting for their batteries to run flat before recharging them, just like we do not wait for our mobile phones to go flat before plugging them in. To avoid hogging the charging stations, one driver will have to hurry down to the carpark at 12.00 midnight to unplug her car and find another parking spot, while another will need to come down at the same time and plug his car into that same charging station. Imagine the disruption to everyone's sleep rest cycle and the number of neighbour disputes that this would spark.

One possible solution to this problem would be for charging stations to serve multiple car lots at once, with an automated system that recharges the cars on a rotational basis. This will spare drivers the need to unplug and re-park at night. The technology for this already exists, but it is unclear if these types of chargers will be deployed in Singapore car parks.

The batteries in BEVs are heavily dependent on two metals: lithium and cobalt. According to a study by Deloitte, BEVs account for about 27% of global lithium demand, while lithium-ion batteries account for about 59% of cobalt demand. More than half of the world's cobalt comes from mines in the Democratic Republic of Congo and there are ongoing concerns about the health, human rights and geopolitical risks of mining this mineral. Any disruption in supply of materials for BEVs might affect their production and raise their prices in future. The price of cobalt rose by 90% between January and December 2021. Economists have warned against the possibility of "green-flation" caused by supply chain shortages, leading to higher prices for metals and minerals that are essential to EVs and other renewable technologies.

We have to keep this in mind that the mining of lithium and cobalt and the manufacture of lithium-ion batteries also produce large amounts of greenhouse gas emissions. This could negate some of the green benefits across the full cycle of BEVs.

A large number of BEVs will also place a heavy load on the electricity grid. Will the grid be strong enough to support so many vehicles being charged at the same time, including many using fast chargers, which will drastically increase peak power demand? The cost and carbon output of grid upgrades will need to be considered if you want to fully electrify our transport using BEVs.

Fuel cell electric vehicles (FCEVs) are another major type of EVs which are much less discussed than BEVs. They run on hydrogen, the most abundant gas in the universe. They are more energy efficient than ICE vehicles and produce no harmful tailpipe emissions, only water vapour and warm air. They are powered by electricity generated by fuel cells through an electrochemical reaction between the hydrogen fuel and the oxygen in the air, facilitated by a fuel cell catalyst.

Some might have safety concerns about the FCEVs becoming Hindenbergs on wheels. In terms of vehicle fires, leaks and explosions, FCEVs are measurably safer than ICE vehicles. Hydrogen is much lighter than petrol vapours and dissipates much faster if there is a leak, reducing the potential for explosions. In any case, safety regulations will dictate that hydrogen fuel stations must store gas above the ground in well-ventilated areas.

FCEVs bring with them some advantages over BEVs.

First, they can be refuelled much faster that BEVs are recharged. Each BEV will require at least 90 minutes to fully charged using a fast charger and up to six hours using other types of chargers. In contrast, FCEV buses can refuel their hydrogen tanks in as fast as 10 minutes.

Second, with improvements in technology for the production and distribution of hydrogen, FCEVs could eventually have a lower carbon footprint than ICE vehicles and possibly even BEVs.

Third, a study by Deloitte forecasted that the total cost of ownership of FCEVs will be less than BEVs by 2026. Currently, the cost of production and distribution of hydrogen is much higher than diesel or petrol. However, many countries are devoting significant efforts to developing sustainable hydrogen production technologies. With improvements in technology, hydrogen prices are expected to decline over 40% in the next 10 years.

With the benefits that FCEVs bring and some of the risks and disadvantages of BEVs, it would be prudent for Singapore to include FCEVs in our local mix of EVs. The KBR hydrogen study commissioned by the National Climate Change Secretariat (NCCS) found that taxis, buses and heavy goods vehicles are well-suited for hydrogen fuel, given the high daily distances they travel. What are the steps that the Government is taking to transition our public transport and goods transport systems to use green hydrogen?

Hydrogen is not just useful as a source of clean energy for vehicles. It also has multiple other industrial applications, including in clean power generation. About 30 other countries, including New Zealand, the Netherlands, Belgium and South Korea, have already rolled out hydrogen roadmaps. Singapore should do the same.

This national renewable hydrogen strategy will spur the creation of a hydrogen economy in Singapore. It should map out our plans to invest in the development of hydrogen technologies, propose new legislation, set national targets for low-carbon hydrogen and develop a pipeline of local talent to take advantage of careers in this emerging sector. This will set Singapore on a path towards being a global player in the hydrogen industry and benefit Singaporean workers.

The Government is targeting a two gigawatt peak of solar energy by 2030. Yet, even if this target is met, solar energy will still supply only about 4% of our total electricity demand. Given that solar energy is one of Singapore's most promising renewable energy sources, we have to make a much bigger push to develop it and set bolder targets for solar energy in our electricity mix.

Rooftops present one of the most promising platforms to deploy solar photovoltaic (PV) systems, given are highly urbanised landscape. The Government's SolarNova programme is looking to install solar PV systems on the rooftops of public sector buildings, including HDB flats.

I asked the Minister for National Development on 10 January whether HDB intends to install solar PV panels on all HDB block rooftops where feasible. I am glad to note the Minister has replied in the affirmative.

We should make a stronger push to install solar panels on all rooftops, both public and private, that do not have physical encumbrances. This is similar to a call made by my hon friend, Mr Leon Perera back in 2017. This would greatly increase our solar energy capture. Currently, EMA allows consumers to be paid for channelling the excess solar electricity back to the grid and BCA has a green mark scheme for solar panel adopters.

However, from a reply by the Minister for Trade and Industry to the Member of Sengkang Assoc Prof Jamus Lim, I note that the Government does not provide grants or subsidies to further incentivise the adoption of solar energy. The Minister also stated in his reply to Assoc Prof Lim that the cost of solar energy is now generally cheaper than the retail electricity price and regulated tariff. It would therefore make economic sense to encourage widespread installation of solar PV panels among private property owners and purchase electricity from them.

This rings especially true in view of the current high electricity prices caused by supply, shortages of natural gas, which we are currently over depended on for power generation. This is a subject which I elaborate during the debate, on the Energy Resilience Bill last November.

The Government should rethink its current approach and provide more incentives for solar adoption in the private sector. Landed properties, condominiums and commercial buildings provide a significant amount of rooftop space for solar panel deployment. Incentivising all of them to install solar panels could greatly improve our solar panel coverage. It could help Singapore derive more than the projected 4% of our electricity from solar energy.

To clear, I am not suggesting that the Government should unconditionally subsidise landed property owners or companies to install solar panels, which they can later profit from by selling electricity back to the grid. They should be required to transfer excess electricity back to the grid without receiving any payments until their installation subsidy is fully covered. At the end of the day, this will still be a win-win for property owners and the nation,

In conclusion, Mr Speaker, Singapore needs to be bolder and braver in setting green goals to secure our future. Some of these may be stretched goals today but we have to trust that future generations will discover breakthrough technologies to overcome our disadvantages. Technology is improving all the time and more so when huge resources of governance are being poured into research and development into low-carbon alternatives.

We need to ride the technology wave; not fall behind it. If we take a wait-and-see approach to hydrogen and other technologies, we might start seeing even our neighbours overtake us. Let us push harder on the adoption of FCEVs, come up with a bold hydrogen roadmap and incentivise the installation of solar PV panels in Singapore. This will move the needle significantly to advance Singapore's transition towards a low-carbon society. I support the Motion.

Mr Speaker: Ms Hany Soh.

4.53 pm

Ms Hany Soh (Marsiling-Yew Tee): During last year's Motion to accelerate efforts to address climate change and its impact on Singapore, I spoke about the importance of involving our community in our efforts to greenify the environment, raising greater awareness and encouraging more to shift towards an eco-friendly lifestyle.

Since then, the community has made good progress in embracing green living. As part of the contributions made towards Singapore's goals under the Green Plan, 15 PAP Town Councils launched the Action for Green Towns (AGT) initiative in May last year to level up our sustainability practices within the communities.

The AGT initiative affirms the importance of combating climate change in creating a better home for every Singaporean, aiming to do so by achieving zero waste, energy-efficient and greener towns by 2025.

The actions in support of this mission are coordinated across the 15 Town Councils by an AGT taskforce and are driven within each PAP Town Council by a dedicated Sustainability Committee consisting of residents, Young PAP activists and an elected Member of Parliament responsible for championing sustainability efforts.

The AGT taskforce is headed by Chairperson, Dr Wan Rizal and I am humbled to be appointed as the Sustainability Champion for Marsiling-Yew Tee GRC as well as the Vice-Chairperson of the AGT taskforce.

To achieve zero waste, the AGT taskforce is partnering up with SGRecycle to deploy at least 78 paper recycling machines in HDB estates. Marsiling-Yew Tee Town Council is one of the Town Councils taking part in this initiative and has since launched five machines across four divisions. We hope that this will improve recycling rates up to an estimated one to 1.5 tonnes of paper per machine per month, which is equivalent to saving 17 trees. As incentive, residents can earn cash each time they drop in their waste paper to such machines for recycling.

I have shared with this House before that in Woodgrove division, we have a "G.E.L" mission, where "G" pertains to "Green-Living" initiatives. In addition to the efforts which were rolled out through the AGT taskforce, over the past one year, we have also conducted two sustainability dialogue sessions and organised 10 upcycling-related workshops and activities which have been participated by over 700 residents across all ages, all of these were made possible through collaborations and supports by our grassroots leaders and community partners, such as Tzu Chi Foundation.

Through these initiatives, we hope to grow more interest in our Woodgrove residents to embrace a greener living lifestyle. One of my residents, Ernest Yen, is one of the active participants of our Sustainability dialogue sessions. As a Year 1 Mass Communication student in Ngee Ann Polytechnic, he recently approached me to conduct an interview for his school project, during which he shared with me that he has decided to focus on "Green Sustainability Efforts in the Community" as the theme of his project, as he wishes to pick up new skills and play a part in the community effort towards going green.

Moving forward in Woodgrove division, we intend to continue inculcating more youths like Ernest to become our green champions, through gamification along with increasing community engagements geared towards working adults and seniors, including those with mobility issues or other special needs. One example would be our plan to collaborate with Northwest CDC to conduct a series of SkillsFuture workshops on sustainability to enhance green knowledge among the residents. These workshops will encourage residents to identify their interests, upgrade their skills and thereby create opportunities for them to explore green career options. The increased exposure will hopefully lead to more supply of green talents to support sustainability in Singapore.

As Minister Grace Fu has shared in the MSE's addendum to the President’s Address last year, 55,000 jobs are expected to be created in the sustainability sector over the next 10 years. Some green jobs which will potentially be in great demand in the near future include built environment designers and engineers, sustainability consultants and green finance and investment managers.

The built environment provides many opportunities for a career in sustainability, as each phase of a building or facility's life cycle, from development feasibility studies, design and construction, to maintenance, operations and demolition stages can be improved with sustainable strategies.

Education and upskilling via SkillsFuture courses will also be helpful in transforming many of these existing jobs in the built environment, with an added focus on being green and sustainable.

During the Edusave Bursary Awards last year, I had the chance to interact with many of our youths who have completed their "O" levels and are now pursuing a Diploma in the Polytechnics. Some of the courses they are in fascinate me, one of them being the Diploma in Sustainable Built Environment offered by Republic Polytechnic, which aims to prepare students to take up roles as Energy and Sustainability Consultants.

Like Li San, I believe we can develop more essential knowledge and skills modules focusing on sustainability in our Institutes of Higher Learning (IHLs) and accredited SkillsFuture courses, such as the Specialist Diploma in Environment and Water Technology, being a one-year course offered by Temasek Polytechnic, so that Singaporeans, both young and old, can increase their employability with regard to green industries. In addition, we can also provide more internship opportunities for IHL students to learn sustainability practices in various industries.

Aside from helping our workforce to learn the relevant skills for green jobs, we should also empower and encourage more Singaporeans to pursue their dreams and become green entrepreneurs. Aspiring entrepreneurs who wish to do so can tap on platforms, such as Feed9B, an open innovation platform that aims to bring start-ups, small medium enterprises (SMEs), large corporations, institutions and Government agencies together to promote food sustainability and innovation.

[Deputy Speaker (Ms Jessica Tan Soon Neo) in the Chair]

John Cheng, Chairman of Feed9B, has shared with me that he hopes to build a food ecosystem that will not only provide a platform for collaboration but also to act as a resource and research centre ultimately championing Singapore's "30 by 30" goal and position Singapore as a global leader in food sustainability and innovation. Feed9B has also launched a Good Food Startup Manual, a free resource that helps entrepreneurs navigate the food landscape. This initiative involved agencies from various Ministries, including MTI's Pro-Enterprise Panel (PEP), Enterprise Singapore (ESG) and Singapore Food Agency (SFA).

John is also the founder of Innovate 360, Singapore’s first food accelerator with shared facilities that assists startups in scaling and going to market. They provide co-working spaces, test kitchens, shared laboratories and manufacturing facilities as well as opportunities for mentorship, funding, networking, distribution and collaboration with other firms.

One example of a recent collaboration was An Artisan’s Christmas SG Bazaar which showcased more than 30 Singapore brands that place an emphasis on sustainable materials and processes, innovative designs or a key part of our local heritage. It was where I became acquainted with C2+, a local disinfectant manufacturer. Their range of food-grade, alcohol-free disinfectant products are made with ingredients that are 98% edible and are derived from food waste, such as cashew and soybean extracts, which is a shining example of what our local startups are capable of in terms of promoting sustainability and green living. These companies see themselves as a meaningful part of our nation’s journey towards reaching the goals set in our Singapore Green Plan 2030. I do not think they deserve to be unjustly criticised by skeptics as “merely going through the green motion for publicity sake to generate profit” without first understanding how much effort these companies have actually put in towards steering their R&D and business operations towards being eco-friendly and sustainable. In Mandarin please.

(In Mandarin): [Please refer to Vernacular Speech.] Last year, the Government announced the Singapore Green Plan 2030, setting out clear goals for urban afforestation, sustainable living and a green economy. It is inspiring to see that, as we head towards these goals, we are also creating many new job opportunities in sustainable development sector. I suggest that the 5 CDCs organise more of these SkillsFuture workshops so that Singaporeans, regardless of age, including those vulnerable groups who are still seeking employment, can develop an interest in and understand job opportunities in the green sector and be trained with relevant skills.

(In English): Mdm Deputy Speaker, many businesses and jobs in Singapore can be transformed with green knowledge and skills through education and upskilling, aspiring to leave no one behind. Concurrently, this, in turn will contribute towards making our Singapore a greener and more sustainable living environment for all in the long run. I support the Motion.

Ms He Ting Ru (Sengkang): Mdm Deputy Speaker, today's Motion is about how we can move towards a low-carbon society. It rightly points out that in order to do so, there is much more to be done through the partnerships we built between the business, Government and people sectors in order to move Singapore's transition towards a low-carbon society. Indeed, many advanced economies, like Japan, are setting bold targets of being carbon-neutral or even carbon-negative. This is, no doubt, even more important because of the pressing climate and resource crisis faced by everyone on Earth. And we, in Singapore, must do our fair share to bring about a green and sustainable future for our planet.

The Workers' Party supports this and I would like to note now that, while important, moving towards being low-carbon and going green is only part of the wider picture of how our economy and society should look like in the future. Changes need to be systemic and sustainable in the long run. And being sustainable goes beyond just the environmental impact. It also includes the sustainability of the social, economic and cultural impacts that our industries and businesses have on our communities and these aspects are intertwined with and often inseparable from environmental matters.

So, while it is the case that we must urgently take bold and swift action to move towards a low-carbon society, it will be a massive missed opportunity if we deal with these issues in silos and our efforts to reduce our carbon emissions are taken in isolation from the social, economic and cultural aspects of sustainability.

To achieve these aims, our businesses could take inspiration anew from John Elkington's original idea about the 3Ps – people, planet, profit – which he has since adapted to refer to people, planet and prosperity. Specifically, he has called for our industries to look to minimise negative impacts and to maximise our positive impacts on all three aspects. And I believe that there is much wisdom in this approach.

Singapore, our businesses and industries are irreversibly plugged into the global trade and supply chain ecosystem. Even trends of glocalisation, exacerbated by the shocks brought about by the pandemic, have not reduced the complexity of our global supply chains. Our position at the crossroads of many networks, whether they relate to physical trade, such as our importance as a trading port, or services, such as data centres, financial and fintech systems, means that we continue to be in a position to exert influence far beyond our shores. Corporate responsibility cannot remain focused only on issues within our borders, but must consider the external impact that our industries' actions have beyond Singaporean shores.

We, therefore, must build credible, accountable and sustainable ecosystems for our businesses to thrive in beyond our borders where necessary. To do so, we must not only, as the Motion states, seek greater Government intervention to enhance corporate accountability, but we must also create the right set of incentives and regulations to build genuine, thoughtful corporate practices to maximise positive impact on our people, planet and prosperity.

We must also be aware of cheap marketing gimmicks which serve the purpose of winning short-term customer favour. Instead, we should work together with our industries to rewrite the playbook to create genuine sustainable change.

A few years ago, I was fortunate enough to, as part of my job, we are going to campaign within what was seen as a sunset industry to lead the charge to drive consumer and industry change. We created a campaign backed by the United Nations' Sustainable Development Goals to set out clear direct steps for consumers and industry players alike to advocate in order to banish antiquated and unsustainable practices. While tackling planet, the environmental and ecological impact of operations, we quickly realised that we also needed to address the people and prosperity elements in tandem to effect meaningful change for the industry. This was no less because ensuring that smallholders were able to earn a living wage, in turn, reduced the likelihood that they would, as a matter of necessity, sacrifice long-term goals for short-term gains, which were often environmentally harmful in order to feed their families.

We thus worked with global and local NGOs to develop best practices and educational materials for workers to understand what they needed to do in order to keep safe while minimising the impact that they had on the environment. These practices would maximise the long-term sustainability of the land and their livelihoods by adopting new technologies, such as adopting better ways of ensuring robust traceability in the supply chain for customers, be it B2B or end-users. Education also had to be done to explain why the current pricing mechanism was lacking and also why they should demand sustainability when making their consumption choices.

While working on agricultural sustainability practices in rural settings may seem a long way from best practices in our local urban context, the principle of ensuring genuine sustainability and environmental practices applies equally to us, as well as in our cross-border investments. For example, Singapore-based Olam has found itself in hot water in Brazil recently. This issue was brought up by my Aljunied colleague Mr Leon Perera as allegations were made by the Brazil Federal Labour Prosecution Office and the International Labour Organization (ILO) that the company participated in the widespread use of child and slave labour in Brazil's cocoa industry. In filings last year, Olam admitted that they could not trace the origin of all their cocoa beans. This is despite marketing messages on its website that promised customers that they will know that the chocolate has been produced in a way that supports the most vulnerable people and environments in the supply chain.

While environmental and social issues as a corporation become increasingly critical, the Government plays a key role in holding corporations accountable. These examples illustrate the importance of a holistic approach to ensuring our planet and people continue to thrive and how we need to build the right corporate culture in Singapore across these various spheres of sustainability. It is also insufficient to allow companies to be mindful only of direct actions performed within our shores when they have wide impact abroad.

As mentioned, the intricate and complicated nature of the global supply chain makes traceability and accountability even more important than ever. Only then can we be certain that corporations and the products we buy and also what our Government buys, not only do not harm the environment and have minimal footprint but also do not participate in the exploitation of vulnerable peoples. It is not always straightforward for companies to audit the practices of their suppliers or even going further upstream to ensure compliance up and down the entire supply chain, but we must not let perfection be the enemy of the good. Working with the Government to make best efforts to build more robust measures to place greater accountability across the system will make significant headway towards guarding against Singapore consumers being unknowingly complicit in some of the ails we read about, such as poor labour practices or the disregard of the environmental impact of practices up and down the entire supply chain.

With this in mind, I have three suggestions to set us on this path.

First, companies operating in Singapore should perform diligence on their supply chains and we need to proactively mitigate against any risks along the supply chain. In 2017, France passed a law that required companies above a certain size to establish a plan of vigilance for identifying risks of human rights, health and safety or environmental violations within their global supply chains. This required companies to proactively build a view of the risks within their supply chain and to put in place procedures to mitigate these risks. This allowed companies to better evaluate potential partners and subsidiaries and also requires mechanisms to be put in place for workers and organisations to flag violations.

This approach is especially relevant in the post-pandemic era where businesses everywhere are re-examining the sustainability of their supply chains and looking into whether they can be rationalised or even shortened. This is thus a perfect opportunity to weave in such considerations as part of the economy-wide rethinking. Instead of viewing this just as a cost, we can recognise the competitive advantage this could bring us. As a high-income country, we should be ensuring our own suppliers are environmentally and socially sensitive to offer a competitive edge to those who source from other high-income countries who care about these considerations. It would thus be prudent for our Government to carefully assess whether similar requirements can be placed on companies that operate in Singapore, perhaps beginning with companies exceeding a certain size. Whether or not strong incentives rather than legislation would be sufficient to encourage enough adoption of this, remains to be seen.

Second, we must play our part on the global stage to strengthen the global regime for regulation around supply chains and to be an active player to support wider adoption of such practices internationally. This will ensure that the majority of competitors on the global stage invest in similar practices and will also ensure a level playing field. While it may take a while to get there, we should take heart from the recent adoption of the global minimum tax rate of 15% by 136 countries. I know that, with the right effort, it can be done.

Third, we should continue to support industries that harness latest innovations from fields, such as artificial intelligence (AI) and sensor tracking, to allow companies and governments to exercise greater vigilance of supply chains. For manufacturing companies, introducing technology from the Internet of Things allows managers to seamlessly monitor performance of their production lines in real time and also enables accurate information about matrices, such as energy consumption and the carbon footprint of their processes.

Blockchain technology tools should be looked into for traceability. It might seem gimmicky to see lobsters in the jumbo seafood tanks wearing tags with QR codes that tell you exactly where they were caught and by which fishermen. But the technology actually holds huge potential. It allows the capture of information to allow for more efficient fleet planning and can raise an alert if overfishing is occurring. It also plays a role in consumer education, providing information such as the carbon footprint of their food and gives confidence that the food is traceable to its source and the technology is there to track and ensure that good sustainable practices are adhered to.

These issues and ambitions may sound remote, especially in a world where many are struggling to put food on the table. But the reality is that we are facing a resource-scarce future. In the long run, our local businesses would benefit from being encouraged to start building a sensitivity towards supply chain vigilance and can use this to set themselves apart from our competitors, especially in Asia, to lead the way in markets that put a premium on goods and services that are accountable and sustainable, this will give a big leg-up in the internationalisation efforts of these companies.

That said, I want to bring this spotlight back to the importance of citizen awareness and activism, to amplify the effectiveness of any Government regulation or policy in this space. When consumers are more aware and demand sustainable and green practices and have a mindfulness over the carbon footprint, the greater the incentive will be on companies to be aware of the risks within their supply chain and to adopt greener practices.

To be blunt, if investing in greener practices has no impact on how consumers buy, companies may then shrug and continue the business as usual. To address this, we can take a few steps.

First, awareness of our sustainability effort has to be built into our education system at all levels. Our students should leave the educations system with a solid foundation in the importance of sustainability and also with a vernacular to understand and analyse the information that they receive in the media and from other companies of the efforts that have been undertaken. This vaccination against greenwashing, a topic which has raised by some of my colleagues, would enable consumers to be critical recipients and build a disincentive towards any greenwashing efforts.

Second, we must strengthen protection granted to whistleblowers to ensure that any violations have a higher chance of being found out and that a culture of corporate responsibility is better protected by workers and employers alike. Frameworks or regulations that tackle false and misleading practices, including greenwashing, should also be considered to protect or empower consumers to flag out instances of greenwashing.

Finally, we must work with independent activists in the sustainability space and work collaboratively with them to build a strong ecosystem. This can identify blind spots and encourage innovative solutions and approaches that businesses may not have thought of. We need to leverage the passion that these activists have to nudge our industries to do better.

All these taken together will enhance the literacy and fluency of citizens in sustainability-related issues, enabling a more analytical and sceptical population who are willing to question and call out abuses of false marketing from companies. These citizens will be inoculated against marketing gimmicks by both industries and governments that might disingenuously suggest sustainability conscious practices and instead generate an imperative on them to be truthful and transparent with citizens. For after all, our society and economy would be nothing in a world facing climate meltdown brought about by shortsighted, unsustainable practices that fail to account for people, planet and prosperity.

Mdm Deputy Speaker: Ms Nadia Samdin.

5.19 pm

Ms Nadia Ahmad Samdin (Ang Mo Kio): Mdm Deputy Speaker, the winds of sustainability are shifting. Spurred by pledges at COP26, we look to the future growth of green finance with cautious optimism. Today, climate finance, green bonds and loans are firmly on the agenda of governments and central banks. For the financial industry, increasing scrutiny and sectoral demand for ESG financing are pushing banks to green portfolios. Greening will eventually take place across all industries. Our green financing capabilities and frameworks need to be robust and ready to support these transitions.

Singapore’s financial landscape is notably shifting in tandem with these winds. Both the private and public sector have rolled out laudable initiatives to support this transition. Some of these include the formation of the Green Finance Industry Taskforce, the MOF Green Bonds Programme Office and initiatives like the NEA Green Bond Framework, the recent SGX enhancements on sustainability reporting and climate-related disclosures, as well as the issuance of green loans by multiple financial institutions.

It is encouraging that we see more initiatives to enhance our green financing capacity, with the MAS acknowledging it as a powerful enabler to achieve an effective yet inclusive transition to net zero in the region.

However, the transition to a greener financing ecosystem is a challenging and complex one. Some businesses and operations might be ill-equipped to ride on and benefit from these winds. The central focus of my speech today is to highlight more ways we can support local businesses and the local ecosystem in green financing and accountability.

Today, there is a myriad of attempts to develop universal green loan and green bond standards. Global funds that are linked to ESG-related standards more than doubled in 2020, compared to 2019. More than ever, we need quality frameworks and regulatory support to empower financial institutions and businesses with the know-how of going green.

On an international level, the Green Loan Principles developed by the International Capital Market Association provides a framework for green financing. Regionally, we also see how ASEAN is participating in this effort with the ASEAN Green Bond Standards.

On a local level, schemes such as the MAS Green and Sustainability-Linked Loan Grant are useful in defraying the cost of accessing green finance. And for businesses which find it challenging to retrofit their operations to fulfil sustainability metrics, the Enterprise Sustainability Programme launched last year supports Singaporean companies, including SMEs, to build capabilities. I look forward to more details on the training workshops and resources which will be available.

While opportunities exist, what is the take-up rate and how can we best support our local businesses, especially SMEs, in understanding and seizing them? One possibility is encouraging financial institutions to increase the accessibility of green loans, especially for smaller firms, while providing the capacity building to do so.

Some corporates have been trailblazers in the past few years, publishing green bond frameworks and corporate governance strategies at a company level for going green. But it would be better if we also make it accessible for small players to participate in this process to ensure that compliance costs do not bog them down.

Some specific measures could include greater clarity on what are green and sustainability-linked loans especially for SMEs, its benefits, criteria for businesses to access them and what exactly about their businesses and supply chains would need to change. Most importantly, it should be clear to our businesses what specific impact-metrics need to be tracked, and how they can track them, perhaps leveraging on technology where possible.

The benefit of enhancing clarity is two-fold. Businesses are empowered to assess their own eligibility for these loans when they have access to information and such tools. And second, it provides greater transparency and accountability, to manage greenwashing.

It is in our interest to make green financing more accessible for all players, to allow as many actors as possible to participate and transform.

Additionally, the creation of an MSE- or MAS-endorsed Green Loan and Bond Catalogue could be helpful in supporting businesses moving in the right direction. Ultimately, we should try to acknowledge businesses for transitioning to more sustainable business models. The catalogue could formally recognise businesses that undertook or are undertaking significant and genuine sustainability efforts. This would increase their visibility and encourage consumers to support them. Entities interested in procuring goods and services from sustainable sources could refer to such catalogue.

Including specific measures which businesses have undertaken to go green in the catalogue would also be helpful to other local businesses who are interested in pivoting to more sustainable endeavours, as they would have a better understanding of best practices and how they can participate.

Second, it would do well for us to have a national sustainability accounting strategy. Given Singapore’s status as a financial hub, and increasingly, a green financing hub, we should continue to finetune our green financing and sustainable accounting standards. While Singapore has stringent financial auditing frameworks, sustainability accounting is still a fairly nascent concept worldwide, and there is a high reliance on accuracy, transparency and reliability of disclosures that form the basis of such sustainability assessments.

There is greater recognition among stakeholders that ESG disclosures are necessary and not just a good to have. SGX recently mandated issuers to provide climate-related disclosures by FY23 or FY24, depending on industry.

When shifting winds are difficult to navigate, businesses are increasingly choosing to have third party auditors or second opinions to verify ESG disclosures. However, such ESG assurance frameworks tend to be decentralised and varied. The variety of frameworks could potentially create an obstacle to the consistency of the reporting, and comparison, of ESG performance across entities. There have been some efforts to somewhat synthesise these frameworks, such as MAS’ Project Greenprint providing a common portal to examine ESG disclosures across different international reporting frameworks. But it would be of greater clarity to work towards a strong, Singaporean standard, compatible with global standards for our businesses to aspire towards to reduce compliance costs.

Internationally, various institutions have started moving. The International Financial Reporting Standards Foundation announced the creation of the International Sustainability Standards Board during COP26. It is imperative that Singapore stands in lockstep with international standards for sustainability reporting.

I hope that more guidelines and resources can be given to the relevant institutions and partners to understand and reconcile the myriad of reporting and assurance frameworks currently available. Additionally, I hope that there will be further guidelines developed that are ASEAN-centric and Singapore-centric, to better cater to our local SMEs and smaller companies own auditing standards. With stronger support and partnerships, the quality of our chartered accountants and auditing companies will remain first class as we further develop the sustainable accounting ecosystem at home.

While we want to achieve regulatory clarity, it may be difficult to do when the green financing and sustainably accounting sectors are still rather new and it is unclear what the best standards are. However, this challenge comes with an opportunity to position Singapore as a global leader in the green regulatory space, while enhancing our status as a green financial hub.

One of the ways we can do this is through the creation of an autonomous Sustainability Administration policy-oriented think tank, as a Centre of Excellence for Sustainability Administration. Given that regulations are complex and still emerging, there is room for policy and regulatory research to harmonise and raise the standards of sustainability. Singapore has a golden opportunity to become a regional and even global thought leader in these spaces. The demand for sustainability auditing and green financing will certainly increase in the coming years. Not only can we ride on the winds of sustainability, but we can also redirect it.

To become a leader in this space is not only for our own position as a nation. All countries will in time transition to green energy, transport and manufacturing systems, yet green technology, infrastructure and finance are not equitably distributed. In the region, Singapore can play a critical role in the sharing of knowledge and collation of best practices, so that as a region we can tap on the opportunities in the green transition.

To further ride on these winds, we could also leverage upon Singapore’s (MICE) industry to host regular sustainability conventions and workshops to connect locals with top global talents. This would spearhead regular sustainability-related MICE events to shape industrial innovation, attracting regional and international experts in the process. It would aid in attracting established global partners and budding brands in ASEAN to further the sustainability agenda.

Mdm Deputy Speaker, while climate change is a crisis, Singapore can leverage on the opportunities that it brings for our people and economy. This Motion seeks good, inclusive environmental and economic outcomes for Singapore and Singaporeans. And I thank the young PAP for their continued dedication to the cause and publishing the Climate Action Strategy Position Paper.

New methods of financing would, indeed, invite exciting opportunities for our businesses to grow and contribute to a greener economy. However, I would like to reiterate that the greening process is not just about swapping out for new systems. Businesses and consumers must realise and be prepared that this is ultimately a transition and it would also involve the process of unlearning, and shifting away from old operations, financing and activities that are unsustainable.

This is why we must continue to be bold, demonstrate our national commitment to support businesses and our people in the green and blue economies and to hold ourselves to high standards, so that together, our collective actions are impact-oriented.

Our systems have started shifting in recent years to embrace these changes, but other than ensuring that systems are strong, they must also be accessible to our local businesses and people. Systems change works alongside individual action and there are many in the private sector and civil society who are tackling climate change. Every action and every champion counts. Underscoring the transitions in our systems is the opportunity for our people from all walks of life to be front and centre in this green economy, including taking advantage of the new jobs and career options.

Let us keep up the momentum and take concerted, sustainable action, as we build capabilities to transform and quite literally, try to save the world.

Mdm Deputy Speaker: Mr Henry Kwek.

5.31 pm

Mr Kwek Hian Chuan Henry (Kebun Baru): Mdm Deputy Speaker, I stand in support of today’s Motion.

"Trade-offs" and "sacrifices". These are terms that are frequently associated with efforts to fight climate change. But for the Singapore, beyond sacrifices, there are also opportunities.

[Deputy Speaker (Mr Christopher de Souza) in the Chair]

I see great opportunity for Singapore to create numerous green collared jobs, not just for future graduates, but also matured PMETs, which is a rare opportunity that we can and must seize now.

I see opportunities for Singapore, as the finance, governance and connectivity hub of the region, to transform and influence industries way beyond our shores, thereby cementing our regional hub status for one more generation.

I see opportunities for Singapore to strengthen climate justice by becoming the trusted carbon trading hub of Asia, by facilitating resource transfers from rich countries and consumers, to help those with less become more sustainable, thereby empowering all of us to save the world together.

Before I share the reasons for optimism, let us do a quick stock-take of where the world is, after COP26 and after two years of pandemic.

We all read the disappointing recent headlines on coal power plants that were not categorially phased out, or how there was a lack of new ambitious commitments and how a lone US senator torpedoed America’s ambitions to go even greener.

But beneath these headlines is a tsunami of real change driven by at least two forces.

One, the financial and business sector has finally woken up to their responsibility to Earth. Yes, I fully expect the governments, to fall short in make the necessary $2.4 trillion annual zero-carbon investments. But at the same time, the global financial asset management sector, with $100 trillion of assets, under the leadership of BlackRock, have starting making substantial progress towards ESG investments.

And major businesses are beginning to commit. More than 5,000 corporations have joined the Race to Zero; 1,000 have pledged to Science Based Targets, and I see major private-public partnerships formed to tackle heavy emitting industries, spur new green technologies and drive green procurement.

There is an emerging consensus that being green is not just the cost of doing business, but also the basic moral standard that consumers expect from businesses.

Two, there is at least a global consensus that climate justice is important, and the well-off must transfer resources to the less well-off. In fact, the concept of the “loss and damage fund” is now clearly in the agenda for COP27 in Egypt this year.

Driven by changing consumer expectations and guided by green finance and accounting standards, the private sector can shift towards sustainable production and compensate the affected communities. This can be a huge shift, given that private enterprises, and not governments, are responsible for most production in the world.

And when there is so much money, so much resources, being directed towards sustainability, towards climate justice, you can imagine that accountability and trust will become absolutely paramount.

But while there are some reasons for being optimistic, there are also hurdles that must be overcome.

For example, because there are many emerging sustainable finance, accounting and carbon trading standards that are western-centric, there is also an urgent need for them to factor in international, especially Asian perspectives.

Another hurdle is that, in this age of stiffening geopolitical competition, there is a risk that sustainability may get weaponised by selected countries or trading blocs to create non-tariff barriers.

Here lies the opportunity of Singapore to play a decisive role in the region, and even in the world, to shape the rules, to connect different trading blocks and competing powers. And by doing so, we can transform Singapore into the Sustainable Finance, Business and Trusted Carbon Trading Hub of Asia.

How can we do this, to capture the possibilities?

One, actively contribute to the adaption of frameworks and standards for Asia. Currently, there are many standards and frameworks by key organisations. Just to name a few organizations, they include the Sustainability Accounting Standards Board, Climate Disclosure Standards Board, Global Reporting Initiative, Task Force for Climate Related Climate Disclosure. UN, EU, UK have their own standards. Indeed, there is a lot of work to ensure that what we do here in Asia is compatible and interoperable with the rest of the world, and to ensure that standards are compatible between industries.

Specifically, this means that Singapore must anchor the Asian chapters of these key international frameworks and standard setting bodies in Singapore to encourage them to work together.

We should also actively steer Singapore professional leaders who are in our accounting, auditing and management consulting firms to get involved in these bodies, so that they can build up expertise not just for themselves, but also for younger Singapore-based professionals entering the workforce.

Doing this first task will ensure that the global sustainability framework and standards make sense for Asia and Singapore and that the global standards are of sufficiently high standards.

Two, get our sovereign wealth funds, especially Temasek, to spur Singapore companies to embrace and pilot these new green finance and accounting standards. While standards for businesses have begun to emerge in London and EU, there is insufficient in-depth corporate adoption. The adoption efforts of our Temasek-linked companies who are in Asia will go far to ensure that our standards are meaningful and relevant beyond the west.

Three, through MAS and SGX, push for financial institutes and asset management companies to adhere to these new regulations for both the debt market as well as the equity market. I also hope that in the process of the Government issuing Government bonds, we can also shape our Government’s approaches in evaluating green investments, so as to shape the Asian norms in green infrastructure financing.

Four, build a comprehensive green economy eco-system. We must actively anchor emerging ESG fintech, ESG data vendors and depository, and ESG procurement platforms such as G-17 and Matcha Initiative in Singapore. We must also encourage existing companies in Singapore in the credit-rating, asset management space to create ESG solutions. We can also get our largest accounting, auditing, management consulting and legal firms to partner with international standards bodies, as well as to establish centres of excellence in Singapore.

Five, we can encourage Singapore-based companies to use the new Climate Impact X, the new global carbon exchange launched by Singapore. Climate Impact X enables the purchases of high-quality carbon credits directly from specific projects, including re-forestation efforts in the region. When consumers see companies buy high quality carbon credits, their trust in the companies’ action are strengthened, and this sparks a virtuous cycle in spurring companies to do more for the environment.

Six, we can put together a national utility for business sustainability, like how our TradeNet serves the import and export business. By national utility, I mean that getting our sustainable ecosystem players and our Government agencies to provide cloud-based services, to enable Singapore-based companies to report emissions, purchase green products, and buy carbon credits.

Seven, create a Singapore industry association or alliance specific for sustainable finance, business and carbon trading. These areas are very regulatory-driven and are distinct from businesses focused on environment technology or clean energy. This alliance can then help the Government to develop the industry.

And finally, eight, create a solid SkillsFuture roadmap and position many Singaporeans for these green collar jobs.

At the start of my speech, I specifically mentioned creating green collar jobs for mature PMETs. This should not be a surprise to Members in this House given my involvement with the PAP Senior Group.

We all know that ageism exists in certain globally competitive industries, such as international finance. It is very hard for mature PMETs to stay in these same industries over the years. They usually then switch over to work for local companies in our domestic sectors, or work in our growing social work or healthcare sectors.

But we have a new, emergent area where opportunities are plentiful for our mature PMETs. If they receive the appropriate skills training on sustainable standards, their experience in governance, accounting, finance and cross-border business will be immensely beneficial to the green economy.

And because this is an emerging area, and one that Singapore can play a role in shaping, I am optimistic that Singapore can shape the industry norm so that ageism does not take root.

To conclude, in my previous speech on climate change, I mentioned that it is difficult for Singapore to achieve net zero emission in the coming decade or two, given the constraints of current technology, given the fact that Singapore serves the world by exporting goods and services, and given that we are resource-poor in terms of renewable energy.

But our same status as a manufacturing and services hub of Asia also gives us opportunity to shape the region beyond our shores. We do so by helping them go green. We do so by helping channel resources to the less developed parts of our region in an accountable manner, so that all of us, whether we live in a developed or developing country, can fight climate change together.

And at the same time, we must recognise that the greening of the economy is an irreversible tide. Sustainability is now enshrined into the core of what corporate governance is. If we help our economies and our companies embrace sustainability, we can strengthen our global standing for yet another generation and make Singapore the global-Asia hub of trust, knowledge and connectivity.

I will like to end by thanking PAP's youth wing, as well as the many climate change activists and passionate business professionals whom I met, for shaping my views in this rapidly changing field. With that, I stand in support of the Motion.

Mr Deputy Speaker: Ms Mariam Jaafar.

5.42 pm

Ms Mariam Jaafar (Sembawang): Thank you, Mr Deputy Speaker, Sir. I must first declare my interest as Managing Director and Partner of a management consulting firm that does work in climate and sustainability.

In previous speeches, I have spoken about how climate change, one of the biggest risks facing the world today, can be one of the biggest opportunities for Singapore to lead.

One of these big opportunities is green finance. How big? According to a Global Financial Markets Association (GFMA) report, the development of which I must say my firm was involved, some $100-150 trillion US dollars in investments is needed over the next three decades to transition to a low carbon economy. This translates to at least $3-5 trillion in investments per year – an increase of five to eight times from current levels. And $66 trillion of these investments will be needed right here in Asia.

Today, Singapore is already ASEAN’s largest green finance market, constituting nearly half of green and sustainability-linked bond and loan issuances. There are ongoing initiatives and partnerships between the Government and industry, such as the Green Finance Industry Taskforce (GFIT) to accelerate green finance in Singapore. And there is so much potential to do more.

Green bonds and green loans are now established products. They need to be scaled up and the known gaps and frictions need to be addressed, as many of my colleagues have discussed today. But to meet the needs of companies and investors in the region and globally, as well as to push for more aggressive, more ambitious targets and hence, higher risk projects, a wider range of products and instruments are needed, including equity, structured products, derivatives, project finance and securities financing in order to provide companies and investors different ways to get financing, invest and manage risk or liquidity.

A particularly interesting investment space is climate innovation. Venture capital and private equity investments in climate innovation have grown 14% a year since 2016 to reach $37 billion in 2020, with most funding going into mobility, renewables and waste. But many more times is needed.

The GFMA report estimates that today, the world is between $90 billion and $210 billion short of the yearly investments in new climate technologies needed to achieve net zero. There is a need to bring in high risk and patient capital to fund investments in early stage technologies, start-ups and emerging market firms.

The first generation of “green champion” companies – like Enel Group, NextEra Energy, Orsted – they are generating shareholder returns at Big Tech levels, think about the Facebooks and Amazons. And the second generation, including companies like Beyond Meat and Tesla, are generating returns twice this. The rewards are great. But so are the risks, and the time frames for payback long. Hence, the funding gap.

So, to unlock and catalyse private capital in transition finance and climate innovation, the government and the financial markets should promote the development of blended finance structures, combining public and private capital, in collaboration with national or multilateral development banks, foundations and philanthropic organisations, such as the Gates' Foundation. This must be coupled with Government investment in R&D, including basic research, infrastructure and standards, and smart money from venture capital and private equity.

Innovation is critical in green finance – innovation in terms of the the financial products themselves, but also innovation across the green finance ecosystem. Just to cite a few examples, leveraging geospatial data for climate risk assessment, AI and Natural Language Processing (NLP) to facilitate reporting and disclosures, sophisticated scenario analysis and risk modelling, standardisation of legal contract language, as well as tools and platforms for green finance literacy and risk awareness, for corporate boards and executives down to retail investors. These all represent opportunities for Singapore to boost economic growth and create high paying new jobs as we enhance the green finance ecosystem and build green finance capabilities. We have built a vibrant financial sector and grown new segments within the sector most recently in fintech. We can do it again.

But a key risk to the efficient scaling of the green finance globally is the absence of, or too low carbon pricing and a lack of viable transition pathways for companies to begin. In Singapore, we know that the current $5 per ton carbon tax is not enough to shift behaviour but it has served to signal intent. If we are to achieve the objective of making it less expensive for companies to invest in decarbonising and low carbon technologies than to continue emitting carbon, the carbon tax needs to go up, no question. The question is how we ratchet it up and covering what scope. Too fast and we risk disadvantaging our companies economically or passing on the cost to end customers; too slow and we risk not achieving our climate KPIs or hurting the companies' own long term resilience and missing the opportunity to create business advantage and value. Each sector has a different emissions profile, transition readiness, industry structure, willingness of the end customer to pay.

I echo the views of the Member, like Mr Liang Eng Hwa and Ms Foo Mee Har, that the increase in carbon tax must be phased, I think with the highest emitting sectors first, with explicit forward direction on price levels and ample time for companies to prepare and adjust. And they must be implemented in a way that is a "just transition", minimising social and economic costs for those least able to bear them.

At the same time, we cannot afford to lapse into naval gazing. This space is rapidly evolving, The carbon border tax has arrived and the impact will be felt through global value chains, and could redefine the competitive balance between nations in many industries. And, in the words of Larry Fink, CEO of BlackRock, there is already a tectonic shift in capital as asset managers are moving billions and billions of dollars into sustainable strategies. Companies that do not act, may well soon see capital outflows to companies that do.

So, I repeat the call I made in my Budget speech: Singapore should be bold and lead the way. The Government must move on the carbon tax, albeit with a phased implementation. The Government, the financial sector and the scientific community must help companies and industry associations to design sector specific transition pathways as part of their industry transformation maps and manage their transitions; not just give companies time to adjust but help them move faster and with higher productivity. Singapore companies must change their mindset and see climate and the green economy as a big opportunity. Businesses, investors and the Government must invest behind climate innovation and new technologies. And they must build the capabilities, people and skills needed to do this.

Finally it is not all down to companies and production, but consumers and consumption and lifestyles. We must all understand the climate risk and opportunity and make informed choices on what we are willing to pay for, if we want to leave a better world for our children. Learn from our youth, many are already making these choices. If we do not fully embrace the new green economy, we might fall behind. But if we do, then imagine this: Singapore could be, for climate and sustainability, what the Silicon Valley is, for technology. Mr Deputy Speaker, I support the Motion.

Mr Deputy Speaker: Ms Rachel Ong.

5.50 pm

Miss Rachel Ong (West Coast): Mr Deputy Speaker, my speech will centre on how our Government can better collaborate with the private sector, academia and community in preparing our workforce for the low-carbon economy, via our pre-employment training (PET) as well as continuing education and training (CET) efforts.

Under pre-employment training efforts, also known as PET, may I share the following four points.

First, closing current employability gaps of our undergraduates. Over the last decade, our Institutes of Higher Learning (IHL) have also introduced and strengthened curriculum that supports growth in the green sectors though the full-time graduate employment rates in these courses have not been too encouraging. In the 2020 Graduate Employment Survey, two of our largest IHLs, NUS and NTU, saw full-time employment rates of 63.2% and 58.5% respectively, for environmental engineering, one of the lowest rates amongst engineering graduates. This lower employment rate of environmental engineers amongst engineering graduates is fairly consistent also in the years 2019 and 2018.

While environmental engineering is not the only sustainability-linked course, it is one of the core offerings. This posits the need for us to work with the private sector and our IHLs, to better understand the possible causes behind the lagging employment rates of our students in a course directly linked to the green sector. Whether it is a skills gap, mismatch of skills or a lack of job opportunities for environmental engineers in Singapore, the employability gaps of our current undergraduates need to be studied so that corrective interventions can be made to boost employment rates of our graduates committed to the green sector.

Second, enhanced course offerings in PETs. Looking forward, curriculum for up and coming green sectors can be further enhanced in our IHLs with consultation of industry players. These sectors include environmental logistics, environmental health, architecture and sustainable design, environmental economics amongst others. Some of them are presently offered as electives or post-graduate courses but need to be integrated into the core curriculum of their respective undergraduate schools.

The greening of jobs also means that sustainability-related topics should be extended to many more course offerings in our IHLs. University of California (UC), Berkeley's sustainability-focused or related course offerings make up almost 50% of all undergraduate courses, with 20% fully focused on sustainability. They come from 115 different departments out of 129, ranging from ecologically conscious art, architecture, film, design and urban planning. Our IHLs can do more to integrate sustainability-focused or related courses across schools. After all, the work of stewarding our climate in the present goes beyond conservation, but requires challenging our current attitudes, lifestyles and livelihoods.

On that note, I would like to suggest for our business schools' adoption, the study of the Economics of Mutuality, also known as EoM. EoM is a new business innovation model founded by Bruno Roche, the former Chief Economist of Mars Inc. This concept advocates that business can deliver superior financial performance precisely because it mobilises and generates human, social and natural capital along with financial capital. This provides a new lens through which companies look at their business model for a low-carbon economy. Since 2014, the Oxford University Business School and Rotterdam School of Management have collaborated with Roche separately to set up research and education centres of EoM. These centres uncover best practices and case studies for businesses and SMEs, and develop teaching curricula.

As we transit into a low-carbon economy, a business model of sustainability like the EoM could be taught at both PET and CET levels. Growing collaborations with industry partners in developing new PET programmes ensure relevance to our markets and workforce. Two examples of such public-private sector collaborations are the ITE-Sembcorp Centre for Sustainable Solutions and the Singapore Green Finance Centre. I look forward to more such industry collaborations supporting green jobs in our PET centres.

Third, complement PET curricula with CET sustainability modules. As new skills and technology in sustainability are still evolving and being identified, it may be challenging for IHLs to react fast enough to meet the current and evolving needs of companies. IHLs could consider supplementing curricula with updated modules offered in our CET institutions. This allows our fresh graduates to also be equipped with current and up to date skills. These CET modules can continually be updated with industry consultation and be the agile portion of the curricula for our students.

Fourth, supporting green technology innovations. The partnership with the private sector in building green skill sets should extend beyond established firms, to include cutting-edge green startups with new green tech innovations in Europe, UK and the US. This allows for better understanding of trends, evolving skills and technology. I have three suggestions on how we can support these green tech innovations amongst our fresh graduates.

Suggestion one is the Green Immersion Programmes. Green Immersion Programmes, a concept similar to the NUS Overseas College internship programmes, will place our undergraduates with specific firms and countries that excel in the green space. Sending our students from multi-disciplinary backgrounds to be immersed in cultures supporting entrepreneurial spirit in green spaces, will not only support the growth of green startups, but also the greening of our jobs in various sectors.

Suggestion two: green start-up and innovation accelerators. The Innovation Centre for Applied Sustainable Technologies also known as iCAST in the UK, is a research centre birthed from the collaboration of university researchers, the government, investors and local enterprises. iCAST provides industry accessibility to R&D and investors, and helps players expedite the product to market process. Industry players may include MNCs who are exploring new product offerings or new startups.

With the concentration of academia in research and real-time input from industry on challenges faced, as well as funding from private investors, iCAST serves as a perfect incubator for accelerated growth in sustainable technologies. Aligning to our local context, iCAST is the expanded version of NTU and Enterprise Singapore's EcoLabs Centre of Innovation for Energy, but includes sectors beyond energy. An expanded Singapore version of such a centre, which I will coin as Centre of Innovation for Green Technologies for now, could be formed in partnership with other nations with advanced green technology, with Singapore’s value-add in contextualising application of GreenTech with and for our regional counterparts.

We can imagine that Singapore could one day set up an Institute of Sustainability Leadership for Asia. This institute will house the above Centre of Innovation for Green Technologies, the Singapore Green Finance Centre and other green centres for logistics, buildings and corporate governance in Asia.

Suggestion three: complement private-sector efforts in supporting green innovations. It is extremely heartening to see how the private sector had stepped in to support green innovations in recent years. The Liveability Challenge by Temasek Foundation and CapitaLand Sustainability X Challenge are annual global competitions that encourage sustainability innovations and support them in another stage of new product development. The Government could perhaps find ways to complement such private sector initiatives through providing business infrastructure support for winning firms, while also exploring traineeship programmes for our workforce. It is a win-win for the firms and our people.

Moving to CET, also known as Continuing Education and Training efforts, amongst the non-traditional green sectors in Singapore, we see finance, transport and building sectors hiring sustainability-related positions, with the rest catching up. The greening of sectors will take place only as each gainfully considers incorporating sustainability concepts in their processes.

The Government could further enable through studies on how local companies here as well as overseas have incorporated green processes to their work. These practices and related competencies can be incorporated into our SkillsFuture Industry Skills Frameworks.

At the leadership level, green competencies, such as Sustainable Corporate Leadership Programmes that incorporate ESG factors, should be integrated into the "Leadership and People Management Framework".

May I close with the following thought, that consumer education is key. In order to create green jobs, there must first be a demand and a market value for such work, and ultimately, for companies, especially for our SMEs. This will be derived from consumer demand. In overseas markets with high green consciousness, consumers proactively look to support firms that have a green agenda when they make purchases or investment decisions. This becomes a strong motivator for companies to include green competencies in their job pool and hence, generate green jobs.

Greater engagement with our community groups, grassroots and schools to uncover and overcome obstacles in mindset change, will work well to complement the ongoing good work of Government agencies like NEA. With this, Mr Deputy Speaker, I support the Motion.

Mr Deputy Speaker: Mr Saktiandi Supaat.

6.01 pm

Mr Saktiandi Supaat (Bishan-Toa Payoh): Mr Deputy Speaker, Sir, I rise in support of the Motion. We all have a responsibility to current and future generations to do our best to mitigate the negative impacts of climate change, while there is still hope.

I would like to focus on two key words in the Motion: an "inclusive transition". This means our transition to a low-carbon society must benefit not just Singapore, but Singaporeans as a whole. To me, this also means our strategy cannot be "go green" at any and all costs. This is why the Singapore Green Plan 2030, launched in February last year, is a comprehensive strategy, which includes a green economy as one of its five key pillars. I aim to speak quickly on the green economy in three areas: transitioning to a world with carbon tax, carbon trading and green financing employment opportunities.

First, moving to a carbon tax world. This year's review of the carbon tax level and its forward trajectory will be an opportune time to further elaborate on plans for our carbon taxation system. In doing so, perhaps, the Government can consider the following few points.

One, to be effective in guiding behaviour, taxes must offer a certain and transparent price pattern so that businesses can project their potential expenses and plan accordingly. Instead of reviewing our carbon tax rate every three to four years, can we establish a fixed formula for the carbon tax rate to evolve over a longer period of time?

Two, given that different countries may have different climate change standards and measures, Singapore may wish to eventually explore a carbon border adjustment mechanism to equalise the carbon prices of Singapore products and imported products from outside Singapore. Like a similar mechanism introduced in the EU, this aims to prevent carbon leakage, that is, companies transferring production to countries where climate change measures are looser than in Singapore and are "cheaper" to comply with. At the same time, this measure can help to promote greenhouse gas (GHG) reduction efforts in countries outside Singapore and to spur others to take climate change measures seriously.

Three, as we increase carbon taxes and if we do so in various ways and various levels, I ask for carbon pricing to be part of a comprehensive mitigation strategy. It should contain support measures to enhance the effectiveness and adaptability. I think the Member, Mr Dennis Tan mentioned about just transition measures. And I would like to add on that just transition measures are indeed needed to assist low-income households and vulnerable workers when it is introduced.

Four, while IMF economists have suggested that high-income economies should aim for a carbon price of US$50 to US$75 per tonne of carbon dioxide emissions (tCO₂e) by 2030, we must be careful to pace any increase in our carbon tax so that businesses can adapt and not be forced to leave Singapore. One possibility is to first set the carbon tax level at least around US$8 to US$9 tCO2e, using S&P Platts CEC as a spot reference, or slightly higher to inject some urgency for emitters to accelerate their decarbonising plans. That floor is where the voluntary market is valuing and trading carbon "credits", a concept that I will turn to now.

The other main way countries use to bring down carbon emissions is to establish a cap-and-trade system which caps the total level of greenhouse gas emissions and allow companies with low emissions to sell their extra carbon "credits" or "offsets" to larger emitters. There is also the voluntary carbon markets for companies and individuals, which can co-exist with compliance markets created and driven by regulation, essentially for companies or individuals to buy carbon credits voluntarily to offset their unavoidable emissions. Carbon markets allow for companies to buy and sell these tradable carbon credits that represent reduction, avoidance or removal of a certain amount of emissions from the atmosphere.

According to estimates from McKinsey, the annual global demand for carbon credits could reach up to 1.5 to 2.0 gigatons of carbon dioxide (GtCO₂) by 2030 and up to seven to 13 GtCO₂ by 2050. Depending on different price scenarios and their underlying drivers, the market size in 2030 could be between $5 billion and $30 billion at the low end and more than $50 billion at the high end.

The race to decarbonise in Asia is picking up pace with China introducing its national carbon market in third quarter last year, while other ASEAN nations, including Malaysia, Vietnam, Indonesia, Thailand and Philippines, have taken steps towards establishing their own frameworks to trade carbon credits. Singapore has also pledged to reduce carbon emission intensity by 36% from 2005 levels by 2030.

It is therefore unsurprising that Singapore already plans to become a carbon services and trading hub. This is among the various recommendations of the Future Economy Council's Emerging Strong Taskforce (EST) in May 2021. We need to do this fast as part of our green growth plans as other countries in the region are also looking into it.

Despite the opportunities, the carbon trading market has long been plagued by low liquidity, poor risk-management, limited data availability and inadequate financing. While the establishment of Climate Impact X, a new global carbon exchange established in Singapore to facilitate the sale of large-scale, high-quality carbon credits, is undoubtedly a promising development, it will be useful if the Government can share on how the carbon trading value chain is progressing.

It would also be good to know our plans to further tap on Singapore's reputation for integrity and strength in professional and financial services, such as to establish a carbon credit registry to serve Asia, much like the Verra Registry and the Gold Standard Impact Registry in the US. There is a need to build or enhance the ecosystem which needs to link up the four types of key players: the upstream project developers, NGOs that certify the projects, brokers and traders to facilitate the access to carbon credits and end users, such as companies or individuals committing to offset part or all of their GHG emissions.

Another aspect is we can also enhance the existing exchanges here as it develops standardised contracts for carbon credits and set a benchmark price.

In addition, from an infrastructure perspective, the Government can and must eventually work on the regulatory oversight of carbon markets. This would enhance the integrity and standards of carbon credits traded here, making us more attractive as a hub. In addition, there may be a need to have plans to roll our developmental courses that we can upskill Singaporeans to take advantage of these new economic trends, especially those in the banking and financial services sector. Mr Deputy Speaker, in Malay, please.

(In Malay): [Please refer to Vernacular Speech.] Finally, on the prospects for green financing employment growth. As our economy shifts towards a greener one, new employment opportunities in the green economy will emerge. The "Skills Demand for the Future Economy” Report released last year by SkillsFuture Singapore identified the green economy as a key job growth area for Singapore. The report highlighted that today, there are more than 450 job roles in 17 sectors that require green skills – including financial services, manufacturing, trade and connectivity, hospitality, and the built environment. We can expect more jobs to be greener.

Take the UK for example. There are now almost half a million jobs in low-carbon businesses and their supply chains across the UK. Of which, it was estimated that there were about 6,500 employment in the sub-sectors of low carbon financial and advisory services (as of 2018). The low-carbon and renewable-energy economy in the UK was worth £46.7 billion in 2018, up 15% on 2015 levels.

Hence, we need to find ways to develop a pool of talent to help Singapore remain as an attractive destination for businesses, especially those who place a premium on sustainability. It is important for the Government and businesses to help workers to equip themselves to take on these green jobs – whether within existing sectors or in new sectors. Time and opportunity cost on the part of the workers must also be factored in to allow them to acquire the new skills and to adapt to a greener business environment.

One sector is the financial sector which will play an important role to provide the investment for sustainability projects and in turn, help to shape a low-carbon economy. But we must build and maintain the pipeline of green workers. As the green financing sector grows, we will need to groom human capital early with the know-how to align investments with sustainability and green finance principles. The Green Finance Industry Taskforce announced plans to launch workshops for financial institutions and corporates to build capacity in green finance from May 2021 to April 2022. It is hoped, therefore, that more people will attend these workshops. I hope that the Government will do more. Will this be an ongoing educational programme?

(In English): Mr Deputy Speaker, but beyond all these domestic efforts, our greening of the financial sector allows for a more effective way for Singapore to engage regional partners to accelerate regional climate sustainability projects. Our approach has been one of not curbing directly the financing of brown activity, such as palm oil or coal-related activity, but one that is to wait for greener alternatives to replace it. But what more can be done to engage and work with regional partners to accelerate regional climate sustainability which will be more effective in the long run?

Mr Deputy Speaker, Sir, with strong support from the Government and our stellar reputation as a global financial hub, with a high level of integrity, we are in a good position to fortify this green economy pillar of our Green Plan. It is a fine balance to ensure that we achieve an "inclusive transition" to a low-carbon economy, with the participation of companies, financial institutions and other stakeholders in Singapore. In doing so, we must train to capitalise on new opportunities, strike the right balance to manage the trade-offs, and do more to raise awareness of our efforts to build a green economy. Mr Deputy Speaker, Sir, I support the Motion.

Mr Deputy Speaker: Mr Edward Chia.

6.12 pm

Mr Edward Chia Bing Hui (Holland-Bukit Timah): Mr Deputy Speaker Sir, I rise in support of the Motion.

Sustainable development requires the committed pursuit of a triple "P" bottom line of profit, people, and the planet.

This framework advances the goal of sustainability in business practices, in which enterprises look beyond profits and incorporate social and environmental issues to measure their overall business performance. To achieve a triple "P" bottom line, enterprises re-direct profits towards green technology and reskilling of workers for the green economy.

A green economy does not necessarily equate to higher business costs and unemployment rates. With the right strategies and good execution, businesses can reduce costs, improve productivity rates and ensure that more workers enjoy purposeful employment. More importantly, this leads to a net positive outcome for our planet.

As seen in many parts of the world, carbon tax regimes have been put in place to send an economic signal to move people towards a low-carbon future. While I agree in principle that a carbon tax is necessary to measure the costs of carbon emissions and trigger positive changes, this must be coupled with transformational support and plans for industries and workers to further equip to go green. We need to calibrate the tax amount and couple this with a higher magnitude of transformation support.

This is because a levy of a tax without actual transformation would simply lead to a pass through of cost and eventually lead to a rise in cost of living. This could deepen societal fault lines between those who have the resources to go green and those who do not. We must not allow the transition towards a greener economy to be a source of division in our society.

I believe an example of an industry that is poised to achieve a triple "P" bottom line is the built industry. Current Building Management Software (BMS) can analyse for actionable insights to ensure that energy usage commensurate with the level of occupancy and activities. BMS can also proactively support predictive maintenance which improves plant resiliency. Based on current industry advancements, there have been proven cases that such software driven approaches have saved between 20% and 40% of energy consumption at a building or plant level.

The adoption of BMS presents an opportunity for enterprises to align themselves to the triple "P" bottom line. BMS lowers energy consumption, thereby helping businesses reduce energy related costs. These cost savings would be further welcomed given our current elevated energy price levels.

Preventive maintenance reduces downtimes caused by faulty equipment. Predictive maintenance reduces over-maintenance of equipment that are in good conditions. This reduces time and trips leading to an increase in labour productivity. The combined reduction of energy consumption, longer equipment lifespan caused by preventive maintenance and optimisation of trips reduces carbon footprint and move our enterprises towards all triple P bottom lines.

To support the transformation of industries like that of smart building management, there is a need to aid companies in upskilling their employees so that they are empowered to achieve a sustainable green outcome.

However, upskilling programmes cannot be pursued in silo. They need to be integrated in two broad ways. Firstly, upskilling programmes should strengthen the nexus between digital skillsets and more traditional engineering skillsets. Digital solutions are necessary to monitor, track and report various parameters. Beyond reporting, industries will need to know how to leverage the data and translate into tangible actions. Singapore is starting from a good base as we have invested heavily in empowering our workforce and industries to be digitally ready.

Secondly, upskilling programmes should promote opportunities for deeper collaborations between the Government and the private sector. The Government can scale up programmes that tap on the vast range of skillsets possessed by our private sector partners. The Government should continue to seek out pathfinders and interlocutors to ensure job opportunities for our workers and a ready pool of businesses who can embark on green transformation programmes.

Recently, I had the opportunity to speak with Johnson Controls, who is a global provider in smart building management solutions. Johnson Controls partnered SkillsFuture Singapore (SSG) and Ngee Ann Polytechnic in rolling out a SGUnited Mid-Career Pathways Programme. Besides equipping participants with domain knowledge such as building services management and green building management, the course also imparts foundational digital skills. Learning is further enriched by on-job training within various departments at Johnson Controls.

Upon graduation from the course, Johnson Controls supports and play a role in linking the participants to the network of building clients who are in need to hire digital facility managers. It is also worthy to note that three quarter of the course participants are above the age of 45 who are mid-career professionals seeking new meaningful opportunities in the green economy. Adopting an integrated approach towards upskilling programmes will ensure better alignment between new skills, new purposeful jobs and the expertise industries need to go green.

Mr Deputy Speaker, we are living in exciting times where digital empowers sustainability and where economic and environmental outcomes are aligned. The crucial challenge before us is to provide industries and Singaporean workers the tools, resources and skills to capitalise on the confluence of these various elements. Enforcing a carbon tax regime is not a silver bullet that can guarantee our transition to a greener economy. Alongside such tax reforms, we need to: one, strengthen the nexus between digital and more traditional engineering skillsets; and two, strengthen and scale private sector partnerships in aligning new skills, new purposeful jobs and the expertise industries need to go green. These measures enable businesses to adopt the triple "P" bottom line framework.

As more businesses succeed in going green, this will create a butterfly effect on the whole of society and lend a boost of faith to those who are hesitant towards green transformation. I believe we can make going green a sooner and more viable option for our businesses and create new and purposeful jobs for Singaporeans.

Mr Deputy Speaker: Leader.

Debate resumed.

Mr Deputy Speaker: Minister Gan Kim Yong.

6.21 pm

The Minister for Trade and Industry (Mr Gan Kim Yong): Mr Deputy Speaker, I thank the Members for tabling today's Motion. Climate change is an urgent global concern and would require collective and coordinated global action to address, as the scale of effort needed to make a meaningful impact far exceeds what individual countries can achieve.

As a small island state, we are particularly susceptible to even small changes in global temperature, which will affect anything from sea level to weather patterns to food production and even supply of fresh water.

In fact, our journey towards sustainability started decades ago. Given our limited natural resources and the lack of a hinterland, we have been pushing the envelope to conserve and maximise critical resources such as land and water, and green our island even as we embark on industrialisation and urbanisation.

As a responsible global citizen, Singapore must also play our part in making our world sustainable. We launched a whole-of-nation movement, the Singapore Green Plan 2030 last year, outlining our plans towards a more sustainable Singapore.

However, as we make the transition towards a greener future, we will need to make trade-offs and accept changes to the way we live and work. For example, as businesses introduce greener methods of production, production costs may go up because of the use of greener materials or greener ways of disposing waste. Some may require significant investments in new and greener equipment or need technologies that are yet to be available. This may eventually translate to higher costs for consumers.

But as Prof Koh Lian Pin pointed out, we will be doing ourselves a disservice if we focus only on the higher costs in the short-to-medium term and lose sight of the larger and longer-term opportunities that sustainability movement brings.

We must continue to act decisively to prepare ourselves for these opportunities, while pacing our transition in a calibrated manner and managing the trade-offs and cost impact carefully, as Ms Poh Li San, Mr Liang Eng Hwa, Ms Foo Mee Har and Mr Derrick Goh pointed out.

Minister Grace Fu will speak about Singapore's planning ahead and acting decisively on green transition, including the ambitious steps that we are taking. I will elaborate on what we intend to do on the economic front.

Under the green economy pillar of the Singapore Green Plan 2030, we aim to do three things; first, capture green growth opportunities; second, transform our existing businesses and industries to integrate sustainability into their business models; and third, equip our workers with relevant skills so that they can benefit from green growth.

There are a number of exciting economic opportunities arising from the global movement towards sustainability that play to Singapore's strengths as a transport, advanced manufacturing, trading and financial hub. Several Members, including Mr Don Wee, Mr Gan Thiam Poh, Ms Nadia Samdin and Mr Henry Kwek, as well as Ms Mariam Jafaar and Assoc Prof Jamus Lim mentioned green financing; and Mr Saktiandi Supaat too.

As countries step up their efforts towards their climate change commitments, there will be growing demand for green financing, as well as investments into green technologies, infrastructure and businesses. Singapore has established itself as a trusted financial and business hub. We are well placed to capture emerging opportunities in green financing. In fact, we are already a market leader in Southeast Asia for sustainable debt. The sector is still evolving and there is great potential as demand for green finance continues to grow in the region.

The Monetary Authority of Singapore (MAS) has developed a holistic green finance action plan to support sustainable finance market development, strengthen the financial sector's resilience to environmental risks and standardise and enhance climate-related disclosures.

Mr Don Wee also asked the Government to consider issuing more green bonds. Yes, we are exploring opportunities to do so under MOF's Green Bonds Programme Office.

Carbon services and carbon credits will play an increasingly important role to help businesses and governments meet regulatory or voluntary climate goals. As Prof Koh Lian Pin, Mr Henry Kwek and Mr Saktiandi Supaat mentioned, we can build on Singapore's foundation as a trusted and deep commodities trading hub as well as the vast potential for the creation of nature-based credits in our region to become a carbon services and trading hub. In 2021, 13 international firms anchored and expanded their carbon services offerings in Singapore.

We are also working with like-minded partners to standardise the rules on cross-border transactions of credits and to build the infrastructure and processes to facilitate this. For example, arising from the efforts of the Singapore Emerging Stronger Taskforce's Alliance for Action on Sustainability, DBS, SGX, Standard Chartered and Temasek have set up the Climate Impact Exchange or CIX. CIX provides a carbon exchange and marketplace for companies to access high quality carbon credits. This exchange will have high standards of disclosure and emphasis on high quality carbon credits. This is how we can differentiate ourselves and avoid greenwashing problems mentioned by Assoc Prof Jamus Lim.

Over a longer timeframe, there are also opportunities in low-carbon technologies such as hydrogen, sustainable aviation and maritime fuels, smart electricity grids and sustainable foods. We are investing research and development resources into these areas which we would need for ourselves and we hope to build new economic engines in the process.

These new green activities are exciting, but they will take time to grow and mature. On the other hand, most of our existing enterprises will be affected by the green wave. This is because investors, lenders, customers and regulatory agencies will increasingly impose environmental requirements on these enterprises.

The impact will differ for different sectors and enterprises, depending on the nature of their businesses and operations. The impact is most significant for the largest emitting sectors such as the petrochemical industry.

We have been working with businesses in the sector to help them decarboniese. Last November, we released the Sustainable Jurong Island report, which outlines our plan to transform Jurong Island into a sustainable energy and chemicals park that operates sustainably and exports sustainable products globally.

Our aspiration is for the energy and chemicals sector to increase its output of sustainable products by four times from 2019 levels and achieve more than six million tonnes of carbon abatement per annum from low-carbon solutions by 2050.

The journey is a challenging one but we are determined to get there.

Our power sector, which provides electricity for both businesses and households is also a major emitter. MTI and the Energy Market Authority (EMA) are therefore embarking on energy transition plans to decarbonise electricity production.

We are accelerating solar deployment and plan to import up to four gigawatts of electricity by 2035.

Mr Gerald Giam asked about the subsidies for solar deployment, especially for the private property. We do not have subsidies for solar deployment as solar is already cheaper than our retail electricity and there is already incentive for them to do so. However, EMA has schemes to facilitate the sale of excess electricity to the grid and we will continue to help and support them.

We will also develop and tap on low-carbon solutions, such as hydrogen and carbon capture utilisation and storage (CCUS), when these become more viable. In addition, we will work with generation companies to enhance the efficiency of our power generation systems. But lower emitting businesses will also need to incorporate sustainability as an integral part of their business and embrace sustainability as a competitive advantage.

For example, more tourists and international conferences now require that countries and hotels they are visiting to have met certain sustainability standards. I am encouraged that a recent survey by the Sustainable Living Lab with Singapore Business Federation and other partners found that our SMEs recognise additional market opportunities, reputation improvements and cost reductions as the top three motivations for them to consider becoming more sustainable. I will explain later how we can provide a conducive environment to help our SMEs.

Our third aim is to equip our workers with relevant skills so that they can benefit from the green economy, as Ms Hany Soh, Ms Rachel Ong, Mr Dennis Tan and Mr Edward Chia highlighted. As the green economy develops, many green jobs will be created that will require new green skills. For example, a traditional car mechanic will need now to learn how to repair an electric vehicle. An internal combustion engine is very different from an electric motor. A power engineer will now need to learn about hydrogen, solar and other renewable forms of energies. An investment manager will need to learn about sustainability standards and green financing.

SkillsFuture Singapore identified the green economy as a growth area in their inaugural report on skills demand for the future economy. There are green job opportunities in many sectors, such as financial services, energy and power, built environment and manufacturing. There are also skills that are transferable across sectors, such as carbon footprint management and sustainability management. These skills can equip our existing workforce to take on new jobs or new roles in existing jobs in the new green economy.

Workforce Singapore (WSG) is working with partners to explore a broad-based career conversion programme (CCP) for sustainability professionals. This CCP will not only help companies nurture "sustainability champions" to kickstart their journey, but also support the transition of affected workers due to the greening of their jobs.

At the sectoral level, efforts are underway to build our talent pipeline.

WSG and Singapore Polytechnic have rolled out a new CCP for clean and renewable energy professionals in September 2021. Over the next two years, the new CCP will support the transition of up to 150 existing employees that are impacted and mid-careerists from other sectors into the clean and renewable energy-related jobs.

Separately, MAS is setting up centres of excellence for training and research in green financing. We have three such centres in Singapore – the Singapore Green Finance Centre by SMU and Imperial College Business School, the Sustainable and Green Finance Institute established by NUS and the Sustainable Finance Institute Asia. MAS will also be launching a new Sustainable Finance Technical Skills and Competency category in the Skills Framework for Financial Services. These efforts support our workers in building the relevant knowledge and skills which can, in turn, help anchor Singapore as a leading centre for green finance.

To achieve these ambitions, I agree with many Members that the Government needs to work in partnership with the private sector and the community. The Government's role is to provide an enabling environment to help businesses and workers take advantage of these opportunities. Our approach rests on five key pillars.

First, we will need to right-price resources through the carbon tax, which Minister Grace Fu will speak on later and which Mr Louis Ng also mentioned. The correct pricing will guide investment decisions and spur companies to decarbonise. But it will also come with higher costs for businesses and consumers. We should calibrate and pace the adjustment carefully to give companies sufficient time to adapt, put in place decarbonisation measures and stay competitive, as Members, including Ms Foo Mee Har and Mr Derrick Goh, mentioned.

A higher carbon tax will also have an indirect impact on households. The Government will consider how we can help ease the cost increase, especially for the lower-income households. For instance, when the carbon tax was first introduced in 2019, the Government provided additional U-Save rebates for three years to cover the expected average increase in electricity and gas bills from the carbon tax. We also subsequently introduced the Climate Friendly Households Programme to provide eligible households with vouchers to offset the cost of energy-efficient appliances.

Second, we will complement the carbon tax with financial support to help companies adapt. Last October, I announced the Enterprise Sustainability Programme (ESP) to help local businesses build capabilities in sustainability and capture opportunities in a green economy. The ESP is expected to benefit at least 6,000 enterprises over the next four years. It will support training workshops, capability and product development projects and key enablers, such as certification and financing. Several of these efforts will involve partnerships with the trade associations and chambers.

We will also leverage the green finance drive to provide another incentive for companies to become more sustainable. The Green and Sustainability Loan Grant Scheme (GSLS) that MAS rolled out in November 2020 encourages banks to develop green and sustainability-linked loan frameworks to make such financing more accessible to small and medium-sized enterprises to better support their transition to greener business models. The GSLS helps defray qualifying expenses incurred by businesses and banks.

Third, we are developing standards and accreditation to help companies assess and demonstrate their sustainability credentials.

To date, the Singapore Standards Council and the Singapore Accreditation Council have developed more than 50 national standards and 13 accreditation programmes supporting the green economy. Examples include standards in renewable energy, electric vehicles and food sustainability and resilience. We developed these standards in consultation with industry associations, professional bodies, Institutes of Higher Learning, research institutes and companies to ensure they are relevant and robust.

Singapore is also an active member of the two international standards setting bodies, the ISO as well as the International Electrotechnical Commission (IEC), at the technical and governance levels. For example, Singapore is involved in the development of new ISO and IEC standards in the areas of water efficiency management, waste terminology, solar, photovoltaic and circular economy.

At the governance level, Singapore also chairs the ISO technical management board that oversees some 300 technical committees, including in sustainability, such as for sustainable finance, circular economy and environmental management.

Fourth, we are helping our companies access green opportunities abroad through the Green Economy Agreements (GEA). The GEA comprises two key aspects. First, the GEA would set common rules and standards that would promote trade and investment in environmental goods and services. Second, the GEA would facilitate cooperation in areas, such as the scaling of low-carbon technology and pilot projects.

Negotiations with Australia are underway for the first of these GEAs. GEAs will build on and enhance Singapore's economic connectivity established through our extensive network of trade agreements. They will also strengthen international governance on trade and environmental sustainability and put us in good stead to contribute to international discourse on rules writing and standards setting in the global response to climate change.

Finally, we will partner companies to do research and development and testbed new green technologies and solutions, a point Mr Gerald Giam mentioned. This will help us build knowledge and develop capabilities and place us in a stronger position to capture green opportunities in the long run. For example, last year, we awarded $55 million to 12 projects under the Low-Carbon Energy Research Funding Initiative, which will see collaboration between research institutes and industry to develop low-carbon technologies, such as hydrogen and CCUS.

Mr Deputy Speaker, Sir, the sustainability movement is gaining momentum. There are challenges for our businesses in transiting to a more sustainable business model. There are also immense opportunities for our enterprises and workers in the rapidly growing green economy. The Government will help foster the right environment for businesses and workers to adapt to and take advantage of these opportunities.

As Ms Mariam Jaafar and Ms He Ting Ru mentioned, every one of us has a role to play to support the sustainability movement, do our part to conserve resources, minimise waste and opt for greener products and services. Sir, we look forward to continue working with the industry, businesses, workers and everyone on this exciting journey. On this note, Sir, I support the Motion.

Mr Deputy Speaker: Minister Grace Fu.

6.42 pm

The Minister for Sustainability and the Environment (Ms Grace Fu Hai Yien): Mr Deputy Speaker, I would like to thank you for allowing me to join in today's debate on this Motion. I would also like to thank Members, Ms Poh Li San, Mr Gan Thiam Poh, Ms Nadia Samdin, Mr Louis Ng, Ms Hany Soh and Mr Don Wee for sponsoring today’s Motion.

This Motion draws attention to the importance of developing Singapore’s green economy and ensuring an inclusive transition towards a low-carbon society. On behalf of my colleagues at MSE and across the Government, allow me to express our deep appreciation for the many good and fresh perspectives and constructive suggestions that Members have put forth, including those submitted by the Young PAP.

A year ago, this House passed a Motion declaring climate change a global emergency and a threat to mankind. The latest science has given even stronger evidence on the urgency for action. According to the Intergovernmental Panel on Climate Change (IPCC) report published last August, human influence has unequivocally warmed the climate.

Without strong and sustained reductions in greenhouse gas emissions, global temperature rise will exceed 2°C within this century, increasing the intensity and propensity of extreme weather events, such as floods, droughts and wildfires and accelerating biodiversity loss in every part of the world.

Some of these harsh realities are already being felt today, as seen by recent record-breaking floods in Southeast Asia, prolonged drought in South America, high temperatures and raging wildfires in North America, followed by extraordinary snowfall.

As a small, low-lying island in the tropics, Singapore is particularly vulnerable to sea level rise. Climate change is an existential threat to us.

One year on, our efforts to accelerate climate action and embrace sustainable development have grown stronger. Since the Singapore Green Plan 2030 was launched last February, agencies have made considerable headway. In the coming weeks, the five leading Ministries for the Green Plan will deliver updates on the progress of key initiatives and share their outlook and focus areas for the year ahead.

A similar "green awakening" is rapidly spreading across the globe. At the start of 2020, there were only 18 countries with net zero aspirations. Today, the number has grown to 84, including the world’s five largest emitters, accounting for almost 90% of global emissions and over 90% of global GDP. Despite the ongoing COVID-19 pandemic, countries have sought to incorporate sustainability and climate action in their recovery plans, laying groundwork for the transition to a low-carbon future.

Last November, I had the privilege of leading the Singapore delegation at the 26th United Nations Climate Change Conference (COP26). As the first conference of such a scale and scope since the pandemic, COP26 was a landmark opportunity to rally the world around the climate action clarion call. World leaders, businesses and civil society organisations came out in full force, emphasising the need to raise our collective mitigation ambition significantly in this critical decade.

COP26 had laid a firm foundation and accelerated the momentum for global climate action. A substantive and balanced package of decisions, known as the Glasgow Climate Pact, was forged through hard-earned consensus and compromise. Parties agreed to revisit their 2030 climate pledges, or Nationally Determined Contributions (NDC) and communicate Long-term Low Emissions Development Strategies (LEDS) towards net zero emissions, to align with the Paris Agreement temperature goal.

The Pact will scale up climate action and drive capability- and capacity-building efforts to keep a 1.5-degree climate change within reach. Singapore will do our part to meet our international obligations. We will review our policies and actions under the Green Plan, while managing our inherent constraints and trade-offs. We will also expand our options for reducing emissions through international partnerships and in step with global advancements in low-carbon technologies. We will review our targets and raise our climate ambition, and as Prof Koh Lian Pin highlighted, ensure that our targets are backed by the right strategies, policies and actions.

As a responsible member of the international community, Singapore has been working hard to support a multilateral rules-based approach to address climate change. Singapore, together with Norway, co-facilitated negotiations that brought the Article 6 rulebook across the finishing line, after six years of protracted talks. Article 6, which governs market and non-market cooperative mechanisms towards emission reduction, was the sole outstanding issue under the Paris Agreement Work Programme. The agreement on Article 6 clears the path for the establishment of mechanisms that facilitate the transfer of emission reductions, or carbon credits, we call it, between countries to meet their climate targets, while ensuring high standards of environmental integrity. For countries with limited domestic abatement potential such as Singapore, these mechanisms will present new pathways to raise ambition, as Ms Poh Li San mentioned.

At COP26, we also supported various global partnerships and initiatives aimed at raising global climate action. Singapore became the first country in Asia to join the Powering Past Coal Alliance to progressively phase out the use of unabated coal in our electricity mix by 2050. We endorsed the Glasgow Leaders’ Declaration on Forests and Land Use to affirm our collective commitment to sustainable land use. We joined various other voluntary coalitions, pledging to reduce global methane emissions, green government operations and cultivate climate-smart agriculture. Our membership in these coalitions will facilitate the sharing of best practices and collaboration with like-minded countries.

Singapore will continue playing a constructive role to sustain the momentum for global climate action and support fellow small states and developing countries to build capacity and achieve the Sustainable Development Goals.

Corporates are playing a critical role in driving the global transition. They are increasingly focused on Environmental, Social and Governance (ESG) issues, striving to do well and do good at the same time.

With greater demand from investors, activists and consumers, more businesses are paying attention to their triple bottom lines of Profit, People and the Planet, as Mr Edward Chia noted. The Glasgow Financial Alliance for Net Zero (GFANZ) has gathered more than 450 financial institutions with assets in excess of US$130 trillion, in the common pursuit of aligning their investment portfolios with credible net zero pathways. More than 5,000 companies worldwide have now joined the UN Race To Zero campaign, pledging to take immediate action towards achieving net zero by mid-century, publish clear action plans and submit regular progress reports. Among them are Singapore companies such as City Developments Limited (CDL), Olam International, Singtel and the Singapore Exchange (SGX). Greater private sector involvement will be a multiplier, bolstering our collective response.

Civil society and community organisations also play an instrumental role. As advocates, they raise awareness on the importance of climate action, and organise ground-up initiatives to rally the community for climate action and environmental sustainability. At COP26, I was glad to meet Singaporean representatives from a diverse range of backgrounds: academia, youth groups, businesses, NGOs. Like Mr Louis Ng, I was inspired by their passion and aspirations for a greener Singapore and the various projects and platforms they have mounted to make a difference. Esther, Cheryl, Swati, Xiang Tian, Wei Shan – these are all representatives of how much energy we have found in our corporate as well as our NGO people sector. Ms Hany Soh said many residents also take pride in championing sustainability initiatives through the Action for Green Towns initiatives.

Mr Deputy Speaker, the low-carbon transition is well underway. Going green is no longer an option, but a strategic transition we must undertake to thrive in a carbon- and resource-constrained future. The transition will have far-ranging implications on every facet of society, including our lifestyle and livelihoods.

This Motion is therefore timely, as we are building the necessary foundations for Singapore’s transition to a low-carbon society. The Government has every intent, as this Motion states, to partner the private sector, civil society and the community in turning our collective goals in the Green Plan into reality.

If we work together and make the right choices, the low-carbon transition can yield significant opportunities and rewards. It is in Singapore’s interest to secure an early foothold in emerging growth areas so as to reap valuable dividends and future-proof our economy. As Mr Liang Eng Hwa mentioned, the latent economic opportunities in Southeast Asia are immense, if the region maximises its potential to export innovative products and expands its green service offerings. Miss Rachel Ong also described vivid examples of innovation opportunities created by the global sustainability wave, which our youths and workers can participate in.

As with all transitions, there will invariably be disruptions and trade-offs. The Minister for Trade and Industry Mr Gan Kim Yong and several Members spoke about some of the structural challenges for large emitters in the hard-to-abate sectors, such as the petrochemical and electricity generation industries. Some businesses and households may have to brace themselves for temporary cost increases. Transition costs can also manifest in intangible ways, such as the inconvenience from changing our habits and the way we live, work and play.

Yet we must press on, for inaction will cost us even more dearly.

Without prompt and effective mitigation, the detrimental effects of climate change will be exacerbated. The IPCC reports that global mean sea level rise could reach up to one metre by 2100, if the world pursues a high emissions scenario pathway. While the direct impacts may be clear, the indirect costs, while less immediately apparent, can be even more significant, as Prof Euston Quah and Tan Jun Rui have argued in a recent Straits Times article. For example, floods can claim lives and damage infrastructure, but also displace local communities, raise food prices and disrupt critical supply chains.

With the accelerated global shift towards a low-carbon future, businesses which do not adjust face the risk of shrinking demand, stranded assets and becoming obsolete. A recent study by Standard Chartered Bank showed that eight in 10 multinationals plan to work exclusively with suppliers that are aligned with their low-carbon transition plans by 2025. It is, therefore, in the best interests of businesses, the economy and the nation at large to make this crucial transition.

Deputy Speaker, the transition to a low-carbon society will not be straightforward or a quick fix. To engender an effective and inclusive transition, we have our work cut out.

Mr Gan has spoken about the concrete steps we are taking to capture green growth opportunities, transform businesses and industries, and equip our workers.

Allow me to elaborate on a few other key areas raised by Members. First, raising carbon pricing; second, leveraging carbon markets; and third, strengthening corporate accountability.

First, carbon pricing. I note that Members from both sides of the aisle have spoken in support of the need for a carbon tax and for a higher carbon tax, either at this debate or at the debate last year. I am not sure if this assumption is correct; I tried to listen very carefully, I have not heard anyone asking to remove a carbon tax or asking for it to be lowered. So, I take it the assumption that the rationale for a carbon tax is supported by Members of the House on both sides of the aisle, and also the call for a higher carbon tax is an equally shared view by both sides of the House. So, if this assumption is wrong, please correct me.

We have heard a wide spectrum of views and proposals on this matter. Members such as Mr Louis Ng have spoken on the need for an appropriate carbon pricing policy that drives emissions reduction effectively. While others such as Mr Liang Eng Hwa, Ms Foo Mee Har argued for the need to preserve our competitiveness, to pace our increases, given the weakness of a post-COVID-19 recovery. This speaks to the complex and difficult considerations that influence our approach to carbon pricing. And let me explain our considerations.

The carbon tax is central to our climate mitigation strategy and complements our suite of abatement efforts across all sectors. By pricing the cost of CO₂ emissions, the carbon tax enhances the business case to implement energy efficiency improvements and other emission reduction solutions. These shifts in decisions are vital to ensuring the long-term viability of business investments and activities in a carbon-constrained world.

Indeed, we observe that carbon-tax liable companies have accelerated the implementation of decarbonisation projects. The impact of a carbon price goes beyond current industries. It also ensures that Singapore attracts the right kinds of future investments that are aligned with our low-carbon vision.

Over time, a stronger price signal is needed to steer our economy towards a low-carbon future. This will tilt the scales further in favour of more innovative low-carbon technologies, driving companies to take bolder steps towards decarbonisation. This will also keep Singapore’s carbon tax trajectory in line with the broader international momentum on climate action and support the review of our climate targets.

As many Members have noted, the carbon tax should provide a broad-based pricing signal across the economy. That is indeed the approach we have taken, as Senior Minister Teo Chee Hean had explained at last year's Motion on Climate Change.

Our carbon tax covers about 80% of our total emissions. If we include the excise duties on vehicular fuel, more than 90% of our emissions are subject to a carbon price. This coverage is one of the highest in the world. But we must also balance the need to extend coverage against the potential administrative costs on businesses. Hence, we have taken the practical approach of setting the existing carbon tax threshold at 25,000 tonnes, which ensures that the carbon tax is applied at key nodes and then flows through to the rest of the economy. This reduces the administrative load on small emitters, especially SMEs, to measure, report and verify their emissions. We will, however, continue to encourage small emitters to track their carbon footprint on a voluntary basis and indeed, a growing number has begun to do so.

We agree with Mr Derrick Goh and Ms Foo Mee Har on the need to support companies along their decarbonisation journey with revenue from the carbon tax. In fact, for the first five years, we are prepared to spend more than we collect, to incentivise the adoption of energy-efficient processes and other worthwhile abatement projects, such as through the enhanced Resource Efficiency Grant for Energy (REG(E)) and Energy Efficiency Fund (E2F). Some of the carbon tax revenue is also used to manage the impact of the carbon tax on households.

Under the Research, Innovation and Enterprise (RIE) 2025 plan, we have channelled additional funds towards the research, development and demonstration of low-carbon technologies, such as hydrogen and carbon capture utilisation and storage though initiatives such as the Low-Carbon Energy Research Funding Initiative (LCER FI).

More broadly, we have also increased investments in the urban solutions and sustainability research domain to help us better understand the impact of climate change on Singapore and develop novel solutions for sustainability, such as protecting our coastline, finding cheaper ways of reducing emissions and keeping our homes and offices cool. And this is one point that Ms Mariam Jaafar has raised, about patient capital and investments in the long run, and the Government has been investing significantly in new technologies in the sustainability arena.

Over the past months, the Government has consulted businesses and engaged the public on the need for and the potential impact of a higher carbon tax, as part of our review of the post-2023 carbon tax level and trajectory. The Minister for Finance will announce the outcome of our review at Budget 2022.

Second, leveraging carbon markets to raise our climate ambition and to give our low-carbon transition an added boost.

Companies, especially those in hard-to-abate sectors, are keenly exploring market-based mechanisms where carbon credits are traded. Some may tap on voluntary markets to offset their carbon footprint out of their own volition, while others participate in compliance markets to meet their regulatory mandate imposed by the jurisdictions they operate in. For these companies, the ability to tap on carbon credits from emission reduction projects elsewhere provides a complementary pathway to deliver greater abatement in the near term, while long-term fixes, such as changes to business models, production processes, are being developed and implemented.

Likewise, nations are looking to carbon markets, empowered by Article 6 of the Paris Agreement to raise climate ambition. We agree with Mr Gan Thiam Poh that domestic abatement should remain our priority and continue to take bold steps to decarbonise, including advanced low carbon technologies like hydrogen and carbon capture, utilisation and storage. However, there is significant uncertainty associated with these options at the moment, given that their commercial success hinges on factors such as technological maturity and transboundary cooperation, which are not entirely within our control. Therefore, access to well-functioning carbon markets serves as a complementary option in our toolkit to meet our climate commitments, especially in the event that domestic abatement options do not materialise.

Mr Saktiandi Supaat and Mr Derrick Goh spoke about doing more to build confidence in carbon markets. Indeed, for a long time, carbon markets have been held back by concerns of environmental integrity, exacerbated by a fragmentation in rules and standards and a proliferation of low-quality carbon credits that did not represent real, measurable and additional emissions reductions.

To address this trust deficit, we must first establish robust rules and clear guidelines centred on environmental integrity, ensuring that the generation of carbon credits from emissions reductions projects achieves the desired outcomes of reducing overall global emissions. This is why Singapore agreed to co-facilitate discussions on Article 6 – to provide a common rules-based, global framework and a foundation to safeguard environmental integrity and avoid double-counting.

Concurrently, we are actively participating in various international platforms to promote greater environmental integrity and forge partnerships in carbon markets, as Mr Henry Kwek has alluded to. Singapore recently joined the Voluntary Carbon Markets Integrity Initiative (VCMI) as part of their Country Contact Group (CCG). The CCG seeks to align voluntary carbon markets with international architecture, such as the Paris Agreement and set out pathways for use of voluntary carbon credits to enhance global ambition. Singapore also supports the Taskforce on Scaling Voluntary Carbon Markets (TSVCM) – lots of acronyms here – a private sector-led initiative working group to shape and develop rules and standards for the trading of high-quality credits in voluntary carbon markets.

The third limb, which is to strengthen measures to advance sustainability accounting and procurement practices among our companies. Greening the economy we have today is the first step to growing the green economy of tomorrow.

We agree with Mr Don Wee that sustainability reporting and auditing is a critical aspect of good corporate governance in a low-carbon world.

SGX has published in December 2021, its roadmap for mandatory climate-related financial disclosures for listed entities, starting with listed entities in industries that are most exposed to climatic risks. MAS will be consulting the industry on mandatory climate-related financial disclosures for financial institutions. The Government will consider global developments and the experience of such mandatory disclosures before deciding on the approach for other entities.

We are heartened by the recent acceleration in progress towards a global sustainability standard, founded on the Task Force on Climate-related Financial Disclosures (TCFD) framework. With the creation of the International Sustainability Standards Board (ISSB), there will be a new global standard setter to guide corporate reporting in the sustainability space. There are a lot of initiatives going on and all groups are trying to get their act together and harmonise across the regions.

As reporting standards evolve, we encourage all companies to begin building capabilities in sustainability reporting and auditing, and as Mr Henry Kwek has said, to understand the key nuances that apply to their sectors and in the international markets that they operate in. This is crucial. It is all coming on us and we need businesses doing international business to understand how these regulations are going to impact us.

As a major buyer of goods and services, the Government is catalysing the change. Under the GreenGov.SG initiative of the Green Plan, the public sector has introduced procurement measures to encourage our service providers and suppliers to be more sustainable. For example, public agencies will purchase products that meet high resource-efficiency or sustainability standards. The Government will also consider suppliers' sustainability-related policies and practices when evaluating tenders. We will continue to explore ways to push the boundary on sustainability.

As individual consumers, our choices can make a difference. By voting with our wallets, we can nudge companies to green their products and supply chains. A recent SEC Newgate report has found that the top ESG concern of Singaporeans is whether or not companies are taking responsibility for their supply chain, 81% of it – which confirms the point that made by Ms He Ting Ru on ensuring that supply chain sustainability is respected; and also ahead of other indicators such as giving back to nature and the communities, 78%; and reporting the positive environmental impact that they deliver, 57%.

We agree with Ms Nadia Samdin and Assoc Prof Jamus Lim that greater recognition of businesses that embrace sustainable practices will allow ordinary consumers and other business customers to make more informed purchasing decisions.

The Minister for Trade and Industry elaborated on our efforts to develop standards and accreditation to help companies assess and demonstrate their sustainability credentials.

Other home-grown efforts include the Singapore Green Labelling Scheme, administered by the Singapore Environment Council, supported by NEA, as well as the Green Mark Certification Scheme by BCA for the built environment. So, we do have several of these schemes to help consumers make up their mind, to help decipher which are the companies that have complied with sustainability requirements. They conduct a holistic assessment of businesses' sustainability efforts and certify environmentally-preferred products that meet eco-standards.

Deputy Speaker, let me conclude. Over the course of our short history, Singapore has been confronted with multiple inflection points that compelled us to rethink and reshape the way forward. We find ourselves at yet another turning point. While the low-carbon transition may seem daunting, it can open up a brighter and greener future for Singapore and generations of Singaporeans.

As Members have rightly noted, it is essential that the fruits from this low-carbon transition can be enjoyed by all. As we put in place the right policy enablers, we must adopt an inclusive approach each step of the way, by consulting widely and providing support to those that need a hand. The thoughtful insights and recommendations shared in this House today have been most encouraging. We will study each idea carefully and incorporate suitable suggestions into our policies and plans.

Just like we have always tackled challenges squarely as a nation, we will continue to apply the same determination to the low-carbon transition, turning adversity, crisis, challenges into opportunity. We will build on our own strengths and continue to advance Singapore's competitive position by: supporting global climate action as a trusted interlocutor at multilateral fora, such as the United Nations Framework Convention on Climate Change (UNFCCC), International Civil Aviation Organization (ICAO), International Maritime Organization (IMO) and the World Bank; advancing research, pioneering innovative solutions, and building new norms and standards for the green economy; promoting green finance, digitalisation, and low-carbon innovation, which are key enablers for the green transition; and investing in our people to thrive in the green economy.

Under the Green Plan, the Government will continue our efforts to spur whole-of-society action and catalyse partnerships across the people, public and private sectors for sustainability. With all parties working hand-in-hand to create new growth sectors, we can forge a brighter future for Singapore.

On this note, I support the Motion and call on the whole of nation – corporates, civil society and the community – to join us as we embark on this exciting transition. [Applause.]

Mr Deputy Speaker: Ms Poh Li San.

7.15 pm

Ms Poh Li San: Mr Deputy Speaker, Sir, I wish to express my sincere thanks to all the Members who had participated enthusiastically in this debate and to my fellow colleagues who had listened so patiently to all our speeches. I also wish to thank Young PAP's Climate Change Policy Team for putting together the second climate change paper which captured comprehensive views and suggestions from the businesses and civil society groups.

Members of this House have spoken extensively on wide-ranging topics pertaining to green financing, carbon trading and carbon tax, green jobs and corporate accountability. They have shared many valuable viewpoints and practical recommendations. Let me attempt to do a recap here, which can be broadly organised into three main groups of proposals, raised by the 19 Members who spoke in this debate.

Firstly, to develop Singapore as the regional hub for sustainability-related services and products that will also lower our own carbon footprint, Ms Nadia Samdin suggested that publishing a guide on firms that do well in reducing emissions. Prof Koh Lian Pin, Ms He Ting Ru and Assoc Prof Jamus Lim highlighted the concerns of greenwashing and the regulatory role of the Government to protect consumer interests.

Mr Don Wee, Mr Derrick Goh, Ms Mariam Jaafar, Mr Henry Kwek and Mr Gan Thiam Poh proposed to develop Singapore as the carbon exchange marketplace for the region and building on our carbon marketplace ImpactX.

Mr Liang Eng Hwa and Mr Gan Thiam Poh called for Singapore to be developed as a green finance hub of the region. And to support this goal, more Government green bonds to finance sustainability projects should be issued and tax exemptions for green finance products should be extended to companies.

Mr Don Wee, Ms Nadia Samdin and Ms He Ting Ru highlighted the need to develop international standards for sustainability reporting and accounting and build local capability in these areas by working with associations and companies. There should also be a national accountability strategy and think-tank on sustainability administration.

Ms Foo Mee Har and Ms Nadia Samdin further highlighted the need to support SMEs with more guidance, such as pre-identified green solutions and increased awareness of green loans and grants, especially for small firms. And looking beyond our jurisdiction, Prof Koh Lian Pin and I spoke about how the international carbon trading framework, as agreed at COP26, and carbon offset credits can help us achieve a win-win strategy together with our neighbouring countries to fund renewable energy projects and environment conservation.

Secondly, on the topic of carbon tax, several Members spoke about how we can further balance sustainability and business concerns in levying the carbon tax. Mr Edward Chia, Ms Mariam Jaafar and Mr Louis Ng pushed for more support to transform business practices, so that carbon tax does not end up as a pass-through cost, resulting in higher cost of living.

In addition, Mr Gerald Giam and Ms Mariam Jaafar also called for the Government to invest in sustainability technology innovation to help companies transform their businesses, becoming more sustainable and competitive.

Also, to ensure the lower-income groups are not disadvantaged, Mr Edward Chia and Mr Louis Ng suggested providing rebates to lower-income families to cushion the impact of carbon tax.

Mr Louis Ng, Ms Foo Mee Har, Mr Derrick Goh and Mr Saktiandi Supaat called for an increase in carbon tax so as to nudge firms towards more sustainable practices. They also opined that a tiered carbon tax regime being fairer as companies with lower emissions will pay a lower rate.

Ms Foo Mee Har and Mr Saktiandi Supaat also urged the Government to give businesses ample notice on how the carbon tax will change. Also, they emphasised the need to equalise carbon tax treatment for Singapore-based businesses and foreign businesses importing to Singapore.

Third, but perhaps most importantly, to ensure Singaporeans can seize the opportunities of the green economy in an inclusive manner, Members spoke about how we can equip Singaporeans of all backgrounds and ages to take advantage of these opportunities in the new green economy.

Mr Henry Kwek, Ms Rachel Ong and I spoke about the importance of sustainability R&D and training. We also spoke about the close collaboration with industry and SkillsFuture roadmap for sustainability-related sectors and having more internships and on-the-job training in the sustainability sector.

Mr Henry Kwek, Mr Dennis Tan, Mr Liang Eng Hwa and I emphasised the importance of inclusiveness, to train Singaporeans of all backgrounds and ages, including mature PMETs, to seize new opportunities in the sustainability sector.

And, finally, Ms Hany Soh and Ms Rachel Ong are also strong proponents of green entrepreneurship and encouraged startups in this sector.

Now, to sum up this debate, I would like to turn the spotlight on two other key phrases in our Motion – "inclusive transition" and "low-carbon society".

In the course of our discussion, the emphasis so far has very much been on "what to do" and "how to do". In order for our transition to a low-carbon society to be truly inclusive, we need everyone, from the man-in-the street to the most senior policymaker, to share a common understanding of climate change and sustainability, in particular, how climate change affects our country and what are the trade-offs for us.

Everyone perceives the "sustainability elephant" in a different way, somewhat like the situation in the parable where the blind men touched the various parts of an elephant. For mitigation measures to succeed, we should have a clear and holistic understanding of the precarious situation our island state is in. With a full understanding, each of us will have a greater sense of urgency and motivation to do what is needed.

Our people need to understand why we need to take action, why we would need to compromise in specific areas, why certain sacrifices have to be made and what assistance will be provided to those whose livelihoods have been affected. Measures to ensure environmental as well as economic sustainability must be well-thought through, communicated and understood by all quarters of the society. Then, we can all embark on this green journey in a coordinated and collaborative way.

And the key to creating awareness and common understanding is via clear communication and continual engagement, within different quarters in the society and involving all levels. The discourse must not only remain here in Parliament but, more importantly, should continue in business fora, community workshops, in schools, for example. And viewpoints and suggestions from different groups can then be heard and included into Government policies, business practices and community programmes. And I trust that this Private Member’s Motion and the Young PAP paper on climate change would kickstart more public engagement and create greater awareness and understanding in our society.

It has been said that "justice must not only be done, but must also be seen to be done". And similarly, if I may say so, climate mitigation steps must not only be taken, but also must be seen to be taken.

There are quite a number of green initiatives already rolled out by the Government, some corporates and private civil organisations and community groups. But we should ponder, besides our luscious greenery, would Singapore strike you as a particularly green, low-carbon society?

With the COVID-19 pandemic, more single-use disposable plastic is used than ever, as food and drinks containers, in medications and more. We do a lot more food deliveries these days, and travel by private hire cars is growing in popularity. Stuck and unable to travel, people shop a lot more online and many of these items include fast fashion which will still be destined for hours in incinerators and landfills when they are no longer fashionable.

Interestingly, even as we observe the above trends, we also see more people making the effort to be environmentally responsible, such as by reducing the use of plastic bags, repairing, recycling and re-using, and even cutting down on the consumption of meat, another major contributor to carbon and methane emissions.

So, I urge MSE to continue with its public education efforts and collaborations with civil society groups to encourage Singaporeans and residents to make more green choices in their everyday lives. MSE has recently implemented the Green Action Community Plan and the 15 PAP Town Councils have also started the Action for Green Town programme to make our towns greener, zero-waste and energy-efficient. These are excellent programmes to rally communities to take action together, to keep our homes and environment green.

And compared to the potential in decarbonisation in the industry sector, our individual actions may seem small and insignificant. However, such efforts are very important and necessary to nurture a green culture and a green mindset among our people. From the daily green efforts of individuals, these choices will affect bigger ones in an expanding circle of influence. And it is my hope that, over time, being environmentally conscious and responsible will become a signature trait of a Singaporean.

Finally, I would like to address the big question, which is the subtext of all climate-related discussions – will we be okay? Will being a low-carbon society keep Singapore safe from climate change? Looking at the extreme weather patterns and events that have befallen other countries recently, such as the floods in Malaysia, we must ask ourselves: will we be able to avert the climate crisis? These existential concerns bring us back to the fundamental question of why we are doing what we are doing.

The truth is that there is no guarantee because human beings are dependent on one another. We are also affected by the actions taken by other nations. Will they be able to fulfil their pledges and follow up with implementation?

Fortunately, we are not entirely defenceless. We are already proceeding with works, such as the polder construction at Pulau Tekong and looking at other options to protect our coasts. I hope the Ministry is also considering the example of floating neighbourhoods, such as Waterbuurt in Amsterdam. Another example worth monitoring will be the proposed floating city off the coast of Busan in South Korea, a UN-backed project, which is expected to have its first platforms up by 2025 .

Strengthening our climate defence is expensive. A strong economy is the prerequisite to a strong defence. And we need to maintain our lead as a hub, especially as a financial centre, so that we can afford to pay for climate mitigation infrastructure.

Mr Deputy Speaker, Sir, as I wrap up this Motion, I would like to thank Minister Grace Fu and Minister Gan Kim Yong for listening to our concerns, for responding so positively to our proposals and for their strong commitment in supporting this Motion. And having heard the Ministries' new initiatives and blueprint to enhance green financing and corporate accountability and create green jobs for Singaporeans, I am assured that, so long we stay committed to this green journey, we stand an excellent chance of staying ahead of the competition, as we transition to a low-carbon economy, and we will leave no Singaporeans behind. [Applause.]

Question put, and agreed to.

Resolved,

That this House calls on the Government to enhance green financing, create more green jobs and strengthen corporate accountability, in partnership with the private sector, civil society and community, to advance Singapore's inclusive transition towards a low-carbon society.