Committee of Supply – Head S (Ministry of Manpower)

Manpower Growth and Development

Mr Zainudin Nordin (Bishan-Toa Payoh): Mdm Chair, I beg to move, "That the total sum to be allocated for Head S of the Estimates be reduced by $100".

Madam, our small independent nation will turn 50 next year, a tender age, compared to many other countries around us with established histories.

We have come far in such a short period of time. Let us take education, for example. In 2006, there were 62,918 going to universities. In 2012, six years later, this number went up to 76,665. That is a huge jump of about 20%. Over a span of six years, the number of graduates will certainly be on the rise with our constantly improving education system and the opening of more tertiary level institutions. That would mean more highly educated people looking for employment and career opportunities.

As our country becomes more developed, it will be more challenging to create good jobs and career opportunities for Singaporeans. As an example, in cities like Tokyo, Seoul and Beijing, their youth are contending with the problems of more college graduates than good jobs. Like the Chinese idiom goes, "More monks than porridge".

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In 2013, it was reported that only 28% of Beijing's graduates and 44% of Shanghai's graduates had found jobs. In Tokyo, undergraduates start job hunting as early as one year before graduation so that they can secure good jobs in large corporations. The competition is so intense that some of these graduates went through at least six rounds of exams and interviews to get a job. These are real recent circumstances that others are facing. It is not happening in Singapore but could fall on us if we are not careful.

The examples and challenges that I mentioned beg the question to be answered: what should we, as a small country, do to grow and develop quality manpower in a sustainable manner that will be able to drive the economy?

I believe our strategy, going forward, must be to ensure that Singapore workers, and in particular Singaporeans, enjoy good jobs, competitive wages, and that companies are able to have a highly skilled workforce to help them grow at the same time.

For many years our approach has been to boost productivity for the workers. The productivity enhancement to education and training is, hopefully, giving us the results. Are these efforts to improve the productivity of our workforce giving us the outcomes that we want? Very often, we hear feedback from our young complaining about not getting the good job, the good pay. And, sometimes, we can understand that they are also looking at the investment that they have put in over the years and by their family for education. How then could we ensure that we maintain the sustainable workforce load and at the same time providing opportunities for Singaporeans?

Nevertheless, in the current tight labour market, I am heartened that the Government is taking more concrete measures to promote employment for women and also for the elder workforce. Are we getting more traction for our flexi-work schemes or are we still having challenges in the efforts to get the women to come back to the workforce? We also hear feedback about other workers who are willing to work beyond the age of 65. I believe that the elder workers who are healthy, capable and skilful should be allowed to continue to contribute to our economy without the worries and the cut-off age being put over their heads.

As we look at the Budget this year, Deputy Prime Minister Tharman had announced at the Budget there will be no foreign workforce tightening measures except for the construction industry. Besides managing the quantity of the foreign workforce, we need to seriously manage the quality of our foreign workforce. In this regard, Madam, what are the measures that are being looked at that can help our industries improve their foreign workforce quality?

In conclusion, Madam, a few days ago, this House had overwhelmingly endorsed Budget 2014 that has a far-reaching set of planning parameters. This commendable vision that we want more white collar workers to be active in the industry but more steps need to be taken to ensure that Singaporeans are prepared for the future. What can we do to ensure that they have the proper skills and aptitudes so that they can pick up these jobs in the future and continue to provide a good workforce and manpower quality in Singapore?

Access to the Qualified Manpower for Growth

Ms Jessica Tan Soon Neo (East Coast): Madam, a key assumption of Singapore's success with our restructuring and transformation is premised on growth. And Mr Lim Hng Kiang yesterday in our COS discussions talked about the growth sectors that we are looking at and what is being done.

I have spoken on the point of access to qualified manpower to support this growth. This is an area that I am concerned about as I feel that while we are driving growth opportunities and creating these quality jobs, how do we ensure that we also have the right talent to be able to fill and support these jobs? Given the constraints of our labour market, the core of this talent base has to be a Singapore core.

Access to quality manpower is a key determinant for the businesses to locate their operations here, as well as to encourage our companies in Singapore to continue to locate their operations here, which then, in turn, creates our ability to build those jobs, improve wages and continue to have the quality jobs.

One of the areas I also touched on in my Budget speech was about innovation and our ability to use technology as well. What we have noticed is that there has been a drop in the enrolment of students in engineering, the sciences and IT as well. This is an area that needs to be addressed. I would like to ask what measures are being taken to ensure that we continue to have the talent going into these areas so that we can then build on the skills.

I had also mentioned in my Budget speech that technology and globalisation will affect the way that we work while they present new opportunities as well as challenges. Many of the future jobs do not even exist today. What this means is that our workers have to be agile. What are we doing to help the workforce as we talk about skills building is more than just training? What are we doing to ensure that our workforce is able to adapt to these changing environments? Skills like critical thinking, problem solving, collaboration, communication: these are going to be very core for our workers to be successful.

Change is not a bad thing. In fact, change in this instance is good because we are talking about better jobs, better quality and a better work environment for our workers. But in order for them to succeed, they need to be able to adapt. I would like to ask MOM what is being done to help our workers adapt to these changes as we continue to train them with the specific skills required for future jobs.

The Manpower Challenge

Mr Teo Siong Seng (Nominated Member): Mdm Chair, Members of Parliament, good afternoon. Budget 2014 is a far-sighted, bold and inclusive Budget which can be characterised by 3 Ps – Pioneer, People and Productivity.

For the business portion of the Budget, productivity is at the centre of the economic agenda. Since 2010, the call for productivity has been repeated in practically every major policy speech. There is a strong push for productivity at all levels.

SMEs have accepted the Government's call to rely less on foreign workers and taken measures to raise productivity. It is not an easy path, as SMEs, unlike the larger companies, may not have the knowledge and guidance on how to embark on their transformation journey. Nevertheless, most SMEs know that this is a path that they have to take for their long-term business sustainability.

However, even with all these efforts made and the help from the Government, we often hear SMEs' frustration over the inability to recruit Singaporeans, including local executives. SMEs, unlike the large local companies and MNCs, cannot afford to meet their relatively higher salary expectations. The manpower shortage also means that companies, especially the larger ones offering better salaries, better career advancement and employment terms, would be able to recruit the workers they need. SMEs, thus, would be left with the short end of the stick.

By 2020, 16,000 Singaporeans would have been placed in six local universities. This would represent 40% of Singaporeans in each cohort, up from 27% today. We have not included the graduates from private schools and those who had gone overseas. These better-educated Singaporean graduates will have higher job expectations. Jobs deemed to be of a more humble nature will be less desirable. But this means that there is an increasing vacuum for the lower-end jobs which are subject to foreign labour restrictions and higher levies. If manpower needs are not met, companies will be stranded as they cannot deliver goods and services and may be forced to close or relocate. Firms like Japanese specialised chemicals maker, Ishihara Sangyo Kaisha, and hard-disk maker, HGST Singapore, have already closed their doors and retrenched a few hundred workers.

This brings to us another casualty of economic restructuring – retrenchments. We may be looking at a situation where many of the retrenched are PMEs who used to command a relatively higher pay and positions. According to the statistics from MOM's third quarter 2013 Labour Market report, PMETs formed nearly two-thirds of residents laid off in the third quarter of 2013, and as many as 33.7% of those unemployed are actually university graduates. On one hand, there is a manpower shortage. On the other hand, those older or mature PMEs find it difficult to get absorbed back into the workforce, especially among SMEs who are constantly screaming out for manpower. PMEs find it difficult to lower their salary expectations substantially, and are much less willing to take on a more diverse job scope, but that is mainly in SMEs. Ironically, SMEs account for 70% of our employment. So, how can this situation be tackled?

Manpower issues are extremely challenging, and we have been trying our best to counter them with productivity measures. But at the end of the day, can productivity gains solve all the manpower problems?

SPRING Singapore has put together an SME Talent Programme to help Polytechnic and ITE students get jobs in SMEs to help with the manpower crunch. Perhaps, a similar programme could be started to help displaced and mature PMEs find relevant jobs in SMEs.

In addition, we noted that WDA, through the Professional Conversion Programme and Max Talent, has made an effort to help retrenched PMEs in reskilling themselves for the possibility of finding new careers in selected industries and placement in SMEs. However, SMEs may not be from these selected industries, such as healthcare, tourism, aerospace, finance, F&B and so on. Therefore, would it be possible for this Programme to be finetuned so that more SMEs can enjoy the Programme? We certainly look forward to having specific support to bring the two groups together.

Crane Tower Operators

Mr Png Eng Huat (Hougang): Madam, in May 2013, the National Development Minister made a call for more local crane operators in the construction sector. It was reported that only half of the 3,600 operators here are Singaporeans. There is a need to reduce reliance on foreign workers for two reasons. These are well-paying jobs that Singaporeans can do. According to the Minister, crane operators can earn $4,000 to $7,000 a month with overtime pay and allowance.

A tower crane operator came to my MPS recently and shared his side of the story. He said many companies in the construction sector are still hiring more foreign crane operators, not less. These foreign workers are cheaper and can work longer hours. As a result, salaries came down and many of his operator friends are unable to secure full-time work. Some of his friends work only two times a week. He handed me a letter with the names of 46 tower crane operators pleading for help.

Last night, I met a fellow diner at the hawker centre near my house and I found out he is also a crane operator. He added that foreign construction companies tend to hire their own people to operate cranes. He also felt that the number of foreign crane operators has not come down despite the move to train more local crane operators.

Madam, the reliance on foreign crane operators will never come down despite the call to train and hire more Singaporeans. This is because BCA has launched a temporary initiative to relax the recruitment of foreign crane operators at the same time when it launched an initiative to attract more Singaporeans to join the trade. Under the relaxed ruling, for every new local crane operator hired and trained, a company can now recruit up to four new foreign crane operators. This will probably explain why people are seeing more foreign crane operators and not fewer.

Putting the two initiatives side by side, the percentage of Singaporean crane operators in the construction sector will come down significantly over time. So, the call to reduce reliance on foreign crane operators will not happen anytime soon. I would like to ask the Minister when we can see an improvement in this sector.

Next, major clients like LTA and HDB often require tower crane operators who have at least five years of experience to improve safety. So, the idea of hiring and training new local crane operators is not going to make sense for companies bidding for major public projects. Some have called for the five-year experience requirement to be reviewed and replaced by the number of hours an operator clocked at work as a better gauge of safety regulations.

This idea is worth exploring because an experienced pilot is known for the number of flying hours clocked and not by how long he has his licence. I urge the authorities to look into this so that more local tower crane operators can qualify to work on major projects sooner rather than later.

Madam, I also urge the Minister to look into helping local crane operators find a footing in the industry, if necessary, set in place rules to protect them so that they can have job security. Does it not make sense for the Government to encourage more locals to become crane operators when there are few jobs for them at the end of the day?

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Transforming Jobs

Mrs Lina Chiam (Non-Constituency Member): Madam, the world's economic agenda is not to preserve existing jobs. The preservation of jobs is in direct conflict with labour productivity. Manpower-saving technology is being created more rapidly these days. The case is even stronger now as we face smarter machines.

MOM cannot focus only on pseudo-productivity growth within a sector or within a division. We need to integrate cross-industry trends. For example, 3D printing has productivity innovation potential for the biomedical and chemicals sector.

What we need is a quicker pace of transformation. Industries that do not pick up pace should be engaged. Their workers should be offered social support, such as unemployment insurance and special lump-sum subsidies. It may be even more costly to keep a low value-added job than to create a stronger social net. MOM should begin to study the economics behind this.

We cannot resist change. But we can mitigate the impact. Singapore seems to be making small change and is afraid of increasing social expenditure. Getting workers to retrain and upgrade themselves may be a luxury that the Government can no longer afford. Upgrading was still feasible in the 1980s when technology was improving progressively. Now that change has come exponentially faster, adjustments would become more painful. Singaporeans will be brave enough to face it if the Government is also brave enough to face the change. Unless we embrace revolutionary changes by restructuring our industries, we will become obsolete and irrelevant to the needs of the world.

Raising Labour Force Participation Rate

Mr Gerald Giam Yean Song (Non-Constituency Member): In the latest breakdown of economically inactive persons in Labour Force Survey 2013, there were 8,600 discouraged workers. These are persons who are not actively looking for a job because they believe their job search will not yield results.

There are others who want to work but cannot because of family responsibilities like childcare, care-giving to family and relatives, and housework. Almost half of the over 300,000 economically inactive women cited these reasons.

There were also over 85,000 time-related underemployed residents. These are part-timers who were willing and available to work additional hours but are unable to find better work.

Finally, there are underemployed workers who are doing work that they are overqualified for. Many older PMEs are in this group.

May I ask the Minister:

(a) What is MOM doing to help discouraged workers to find work?

(b) How does MOM help the underemployed to increase their working hours or find jobs commensurate with their skills and experience?

(c) And how is MOM working with companies and other agencies to remove structural impediments to employment, like lack of childcare, student care, eldercare or flexi-work arrangements?

Can MOM publish a new aggregate measure of labour under-utilisation that factors in not only the unemployment rate, but also discouraged workers, the underemployed and economically inactive persons who want to return to the workforce?

Tracking this measure will help focus minds on factors that lead to a lower labour force participation rate, which has a direct impact on economic growth and household incomes.

Laws against Workplace Discrimination

Mr Hri Kumar Nair (Bishan-Toa Payoh): Mdm Chair, thank you. The principle of meritocracy should apply not just in school but at the workplace.

A recent IPS study on racial and religious harmony reported that of the more than 3,000 people polled, 20% of Malays and 18% of Indians said they often, very often or always feel discriminated against when it came to applying for a job and there was a similar response for promotions. Significantly, this perception was not limited to members of the minority races.

While this survey was about perception and not actual discrimination, in such matters, perception is also important. Age discrimination made the news last year when it was reported that several agencies in schools had imposed an age limit when hiring security guards, thereby flouting anti-discrimination guidelines. These examples are not exhaustive. Other forms of discrimination exist, including against gender, nationality and the disabled.

We have guidelines against discrimination issued by TAFEP but they do not have the force of law and there are no penalties for non-compliance. The time has come for anti-discrimination legislation. The usual argument against such legislation is that it will be ineffective —

The Chairman: Mr Hri Kumar, your time is up.

Mr Hri Kumar Nair: I have two minutes, Madam.

The Chairman: Please proceed. There is something wrong with the system here.

Mr Hri Kumar Nair: Thank you. The time has come for anti-discrimination legislation. The usual argument against such legislation is that it will be ineffective as employers who discriminate will not admit to doing so. Yes, it will be difficult to enforce but that is not a reason for not having it. More importantly, such a law will carry a strong moral force and it sends the message about what we believe in and that there must be accountability in employment practices.

In line with this, I also urge the Minister to set up a labour tribunal to hear all employment disputes and grievances quickly and at low cost, much like how FIDReC does for financial disputes. Having a job makes a world of difference in the lives of many people, and those who lose their jobs or are treated badly at work rarely have the ability or appetite to take on their ex-employers in court. Where Singaporeans have a legitimate grievance, we should help them resolve them in a fair, transparent and expeditious manner.

Professionals, Managers and Executives (PMEs)

Ms Mary Liew (Nominated Member): Mdm Chair, in this knowledge-based economy, globalisation and technological advancements can greatly improve productivity and output. Computers are now smarter, can access more data and, in certain sectors, have even replaced many workers' jobs with just a click of the mouse. As we embrace the wave of technological advancements, we must also look out especially for PMEs even in the service sectors and in office and administrative roles.

If workers and PMEs are not multi-skilled or up-to-date with new skills, they will be vulnerable to retrenchment at a faster rate. The employment statistics released by MOM indicate that in 2013, 11,400 workers were laid off, 390 more than the year before. If more is not done for our Singaporean PMEs to stay employed or employable, this figure may continue to rise, in line with technological advancements.

Firstly, can the Minister identify PMEs working in low-growth sectors and launch, nation-wide, an intensified and concerted effort to help them be trained for alternative jobs in high-growth sectors? This is to ensure that they will be protected against redundancy. Assistance can also come in the form of funds required for training, should they make a mid-career switch, especially if they are in their 40s.

For example, present funding support for Part-time or Executive Diplomas in our national institutions are restricted to a five-year time lapse upon completion of the Diploma before the applicant is allowed to embark on subsequent courses funded by the subsidies. With globalisation and a knowledge-based economy, we must constantly stay ahead of global competition through innovation and better productivity. This means that continuous training, learning and education are a necessity for all Singaporeans to stay competitive. Can this five-year time lapse be reduced to two years if we are to remain relevant?

Secondly, will the Minister consider tripartite determination of a national wage range for different jobs? Through the tripartite consultative process, we now have the Progressive Wage Model for the cleaning sector. Extending this to other sectors would be a good progression to determine a wage range to commensurate with PME jobs. This is not a call for a minimum wage, but a conscious tripartite effort encompassing professional associations, including the unions and industry bodies, to determine the fair wage to be paid to PMEs in different sectors. This would be a more comprehensive extension for the role of the National Wages Council.

Thirdly, simply open up any newspaper or online job ad and you can see many jobs in the market today that require someone to be a degree holder – even if it could be a simple and entry-level marketing or administration job at times. If this is to be the trend, will the Minister extend the funding to help citizens in terms of scholarships and bursaries for a University education, since the phenomenon has become more of a necessity than the norm.

Governmental stimulus or policy is crucial in allowing our talented and hardworking PMEs, who will be the rank and file of tomorrow, to flourish and succeed and lead better lives in this Singapore we call our home.

Workforce of the Future

Ms Denise Phua Lay Peng (Moulmein-Kallang): Madam, I have observed three trends that will change the face of the workforce of the future in Singapore.

One, trends that are closer to home, the Singapore labour market:

(a) trimming of the foreign workforce;

(b) rise of the blue-collar workforce;

(c) entry of more fresh graduates into the workforce with the new targeted 40% University enrolment rate per cohort; and

(d) the continued push for productivity improvements through IT, process engineering, job enrichment and lifelong learning.

Two, trends that arise from the unstoppable pace of a digital global world.

This is an age where work is not bound by geography, where learning is not confined to physical classrooms and face-to-face lecturers. This is the age of not only full-blown Massive Open Online Courses but also simpler "playlist-type" of learning models where digital citizens can personalise what they want to learn, sometimes from just YouTube or Google education channels without being obliged to take full certification courses.

Three, trends that relate to an expanded and changing pool of contributors to work.

Beyond the confines of the enterprise wall with its core set of permanent staff is a critical new extended workforce – a global network of outside contractors, outsourcing partners, vendors, strategic partners and other non-traditional workers. Many of them may be one-man self-employed workers or "portfolio workers" who serve several clients; whose work can range from being gardeners to plumbers to webmasters to bookkeepers or even lecturers. Some are partners in small start-ups, similar to the founders of companies like Facebook and WhatsApp in their early days.

I have three recommendations for the Ministry's consideration as it maps manpower plans for the future.

One, MOM should update the mode of teaching and learning of the 21st century workforce in the new CET masterplan it is developing. Three groups of people that make up the workforce of the future in the next decade and beyond will need different types of learning support:

(a) the digital natives who are born into the world of iTune, smartphones, apps and playlists;

(b) digital migrants – many of us here – those who have to learn how to retool and learn to work in the world of digital tools and language;

(c) digital outcasts – those who, for various reasons: age, ability or deprivation – are aliens in the digital world and are at risk of being outcasts forever if they are not supported.

For all of them, it is important to identify and develop the core skills and prioritise elective skills that each group needs in order to maximise their full potential.

Even for vocational skills training, there is room for current MOM-approved CET solutions to move from a more traditional face-to-face methodology to a more updated pedagogy. For instance, to learn how to make a bed, it is likely that a typical WDA trainee will be taught through face-to-face Powerpoints and demos from a trainer. How much more efficient and consistent it is if there are online resources, such as good quality bed-making YouTube clips that will allow the trainer to repeatedly use to ensure a consistent best way to make a bed; and the trainee, if he is able, to first learn at his own time, pace and place and then meet his trainer face-to-face for more individualised coaching? Blended online face-to-face instructions; and flipped classrooms are already common practices in the education system.

I urge the Government to provide more funding to allow MOM to source learning content, pedagogy and assessment that are more relevant to the 21st Century.

Two, MOM should study the profile of the new extended workforce and include them in the Ministry's efforts to attract, train, develop and retain talents. The CET masterplan and any other efforts to improve productivity through schemes, such as the PIC, should seriously take into account self-employed individuals or smaller scale local employee-owners.

Lastly, but not least, I urge MOM to take an even stronger interest and be one of the lead Ministries to innovatively identify and stitch jobs and contracts for those who are at risk of being left behind – the elderly and those with special needs. This cannot be simply left to charity and compassion. If properly trained and supported, they can perform many work tasks for the Government and other employers and free other human resources to be redeployed to more suitable areas of work.

Raising Wages of Low-income Workers

Mr Christopher de Souza (Holland-Bukit Timah): Mdm Chair, the need for higher wages is most acutely felt by low-wage workers who earn less than $1,500 per month. These workers often struggle to make ends meet and require the assistance of Government schemes to assist them with their daily needs.

Therefore, there has been a clear need for the Government to adopt measures that would mitigate the wage disparities in our society, and to ensure that low-wage earning Singaporeans are not left behind. Rather than simply mandating a minimum wage or forcing employers to increase the wages of employees across the board, the Government has rightfully adopted a wider and more comprehensive approach by raising wages the right way.

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Initiatives, such as the Workfare Income Supplement (WIS), have been an effective means for low-wage workers to supplement their incomes, be it in the form of cash payouts or CPF top-ups. Similarly, the Workfare Training Support scheme has been implemented to great effect to provide generous subsidies for the continued training of workers and, consequently, raise the wages of these workers.

In addition, the Government introduced the Wage Credit Scheme (WCS) and the Inclusive Growth Programme (IGP) to provide support for employers who raise the wages of their local employees, as well as to incentivise employers to share productivity gains with their employees.

Taken together, these initiatives have paved the way for low-wage workers to improve their skills through training and to increase their productivity and wages over time. However, I wish to ask the Minister for Manpower: what further efforts are being contemplated to continue to raise the wages of our workers the right way, particularly the wages of low-wage workers who have to make ends meet with less than $1,500 a month, through increased productivity and training?

With the Government and the public sector taking the lead by implementing best sourcing practices, through supporting programmes like the Best Sourcing Initiative, it is my hope that such best practices will also filter down to the private sector and influence their procurement procedures.

I would like to also commend MEWR for championing the recent amendment to the Environmental Public Health Act in Parliament this month. In a sector that is particularly prone to cheap-sourcing measures, the implementation of the new licensing regimes in the cleaning industry will ensure that cleaners are offered better training and employment conditions. This amendment is particularly important as it will operationalise the implementation of the Progressive Wage Model that was recommended by the Tripartite Cluster of Cleaners in late 2012.

A further expansion of the Progressive Wage Model should be encouraged across other industries like the security and landscaping sectors as this model provides a fair and transparent means for workers to attain an increase in wages. As these are industries where wages are often suppressed due to the cheap sourcing measures, the implementation of the Progressive Wage model ensures that low-wage workers in these industries have a clear path for career progression and an increase in wages.

Furthermore, by having a clear ladder for the increase in wages through skills training and increased productivity, workers will be empowered to take a personal responsibility in the improvement of their own skills and the consequent increase in wages.

Progress has certainly been made in recent years to raise the wages of our workers. However, there is still more that can be done to further improve the wages of our workers and to do so the right way.

Foreign Manpower

Mr Yeo Guat Kwang (Ang Mo Kio): Madam, we all recognise the need to complement our workforce with migrant workers, but rather than recruiting by headcount, employers should recruit migrant workers for the skills and value that the migrants can bring to the job. MOM should help our employers to keep their better foreign workers for longer, rather than to encourage the churn of new migrant workers into Singapore which will facilitate illicit profiteering by the errant overseas employment agencies, and the young and unskilled migrants are able to come here for the low-skill jobs just simply by paying more money to the intermediary.

We need to actually emphasise the skills and productivity in our recruitment process. I urge the MOM to have a skills and performance-based standard as a condition for Work Permit renewal for migrant workers. This will increase the overall skills profile of our migrant worker population. Better skills and qualified workers are also easier to upgrade and integrate, more productive and are also less likely to come with the burden of a large agency debt.

Besides skills certification, currently, there is also no standard contract for the migrant workers and this leads to malpractices and exploitation by overseas agents promising terms and conditions that distort and misrepresent the true state of the working and living conditions here.

I hope the MOM would also work with the unions, as well as the Migrant Worker Centre (MWC), to put in place some form of standardised all-model contract for migrant workers or sectoral guidelines covering all the key terms and conditions for employment, living and social amenities in Singapore and yet, at the same time, incorporating the terms or guidelines into the permit approved documentation, and also translate this into a language that they can understand, so that they all know what they are really coming for.

Of the grievances handled by the MWC over the last four years, a large share is due to the calculation and payment of salaries. While the mandating of payslip issuance to the workers has been put in place in the pipeline – MOM has set a two-year implementation target – but to avoid such salary disputes further, I hope the Government will reconsider mandating electronic payment of salary through Giro for all workers, particularly of all the Work Permit holders, as it is already the case for all the S-Pass holders currently.

Mdm Chair, I commend the Ministry for the willingness to review the "one employer from entry to exit" rule at the moment. I hope the Ministry will review this, however, because this control has created an environment that discourages aggrieved migrant workers from coming forward to report the infringements of their employers as they fear being repatriated even if their grievances are legitimate.

I urge the Ministry to allow a change or transfer of employer scheme for all the Work Permit holders, for example, one, workers who have reached the end of their terms of employment; two, workers who can prove legitimate grievances against their employers; three, workers who have obtained their existing employer's consent to change employers. The benefit is definitely significant.

Next point – fair and proper treatment for migrant workers should extend beyond the workplace into their living environment. The major dormitory operators in Singapore, under the advice of the MWC, have already come together to organise Dormitory Associations of Singapore, and have a self-initiated collaboration with SPRING Singapore to formulate some form of accreditation standards for the industry.

I want to call on MOM to encourage as well as participate actively in this collaboration and also lend its endorsement to this set of standards. I would like MOM to consider making this set of standards a regulatory bottom line for the industry to guide the enforcement and prosecution of those who fall below the standards of care, hygiene and amenities.

I would also like the Ministry to tell us whether there are plans to build more recreational centres for all the migrant workers in Singapore.

Madam, connected to the issues of living conditions and the standards of work is also the issue of transportation for the migrants. So, I would like to also ask the Ministry whether they have a plan to ensure that such transportation remains accessible and is safe for all migrant workers between their workplace and their "play" place.

Madam, we would also like to urge MOM to really look into how they can work more closely with the NGOs to strengthen the dispute resolution mechanism for all migrant workers to ensure that there will be amicable resolution of all disputes.

Segmentise Service Sector for Quotas

Mr R Dhinakaran (Nominated Member): Thank you, Madam, for allowing me to raise the issue that is affecting the reliability and reputation of our services sector. I would like to declare my interest on this subject.

In the bid to reduce the dependency on manpower, particularly foreign manpower, we have tightened the foreign manpower quota and raised the levy. This has been applied across all sectors, with the different types of businesses grouped together. While this approach may have helped some industries, I would like to highlight the significant inconvenience and loss of business to some service sectors, like retail and F&B.

These businesses are very heavily dependent on labour. Setting up a retail store is a function of people who sell the product, organise and maintain thousands of products you choose from in a store. But, today, the services sector is a broad classification in which retail, F&B, financial, insurance, real estate, transport, storage, and so on are all lumped together. It is apparent that the level of automation possible and the human customary interaction needed are not the same in all the listed industries.

I would like to request that a study to afford to segmentise the service sector businesses, based on the dependency on human labour, be done so that labour-intensive businesses like retail are not punished unduly.

Today, with the severe staff crunch, we are losing businesses with inadequate services and opportunities to service our customers. Further, the severe drop in quota is already hitting the businesses so hard that the increased levy is an additional blow. The quota, in itself, is sufficient to reduce the foreigner influx, if that is the motive, and the additional levy may not be needed.

I would like to seek a study to rationalise the grouping of the service sector businesses, keeping the practical differences between the businesses in mind so that we do not inflict damage unknowingly with heavy curbs on quota and levy.

Singaporean Core

Ms Mary Liew: Madam, the pleasure craft industry is an off-shoot of our maritime and hospitality industry that is centred around Singapore's four marina clubs, namely, Raffles Marina Club, ONE Degree 15 Marina Club, the Republic of Singapore Yacht Club and Marina at Keppel Bay Club. Luxury multi-million dollar yachts and pleasure boats owned by the wealthy are berthed here as we encourage them to come to Singapore to work and play.

According to the Business Times in 2012, Singapore's pleasure craft industry commands a cool US$45 million or approximately 13% of the Asian market, which is estimated to be worth US$345 million a year. As an industry associated with the affluent, we have identified this sector as one with a high potential for Singaporeans if given the opportunities to earn good wages.

On 1 January 2013, MOM discontinued the issuance of Landing Passes by the Immigration and Checkpoints Authority (ICA) and imposed a work pass requirement for foreign crews working onboard a Singapore-registered pleasure craft. Further to that, a progressive reduction of the dependency ratio was introduced over five years – from one Singaporean to four foreigners, to one Singaporean to two foreigners by 2018. These initiatives give opportunities for Singaporeans to work in the pleasure craft sector and give time for the industry to adapt during the transition phase.

Mdm Chair, I would like to ask the Minister:

(a) What enforcement measures are presently in place to ensure that foreign crews employed to work and allowed to reside on a specific pleasure craft are not freelancing or working for another employer within the respective marinas?

(b) What enforcement measures or legislation prohibits foreigners from entering on social visit passes under the guise of a guest of the pleasure craft owners but, in reality, are working on these pleasure crafts?

I hope that these policies are in place and with rigorous enforcement, so that Singaporeans can benefit from the good jobs and wealth this industry brings.

Fair Consideration Framework and S-Pass

Mr Patrick Tay Teck Guan (Nee Soon): Mdm Chair, it is the hope of every Singaporean Professional, Manager and Executive (PME) to have a fair shot at the job they desire. I applaud MOM for introducing the Fair Consideration Framework (FCF) and National Jobs Bank which both will be in force later this year in August. I recall, as part of the milestone of the FCF implementation, that MOM will start to engage companies with a disproportionate number of EP holders the first half of this year. Can the Minister provide an update on the outcome of this first phase of actions, how the FCF is taking shape, and the progress of the National Jobs Bank software system development?

On the topic of S-Pass, I wish to submit that despite raising the qualifying salaries for S-Passes to $2,200 and new quotas, I still hear two kinds of complaints. Firstly, the complaint of creative circumvention of this salary requirement by companies. Secondly, although S-Pass is for selective strategic skillsets in specific industries, for example, like healthcare where they are welcomed and needed by fellow workers, there are cases where S-Passes are issued to employers for workers doing mere administration or office tasks.

Considering how local mature and young PMEs are facing challenges in having employers' acceptance and finding good-paying jobs, such practices have caused much angst and frustrations amongst our people. Are there any safeguards to make sure that Singaporeans are not replaced by these younger, better educated S-Pass holders? Is the scheme too attractive and flexible such that it will be abused?

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Progress of the Fair Consideration Framework

Mr Zaqy Mohamad (Chua Chu Kang): Mdm Chair, I welcome the Fair Consideration Framework that will come into effect soon, as the outcome is intended to benefit local professionals, managers and executives. I see this as among the positive outcomes of the framework, but there may be question marks and uncertainties about how the framework will work and its implementation.

Many Professionals, Managers, Executives and Technicians (PMETs) I speak to have concerns with regard to how effective the framework will be, as they are concerned that some employers could find ways to navigate their way around the requirement and, in the end, continue with unfair hiring practices.

In this regard, people need to be aware of the idea behind this framework, how it will work, and what the intended objectives are – for this to work effectively for both the employers and job-seekers.

On the part of employers, some see it as a disadvantage, as it may slow down their hiring process, especially smaller companies. Hence, I agree that the framework applies to companies with over 25 employees and they need to first advertise for jobs on a Government-run jobs bank. Can the Minister update the House on what are the details of this jobs bank and what are some of the inputs gathered from employer feedback?

It remains to be seen how companies adhere to this requirement and what sort of impact the framework will have on the economy, especially how we continue to attract new investments. Companies will also need to review their human resource policy and factor in this new framework.

What is MOM's assessment in terms of the impact of this policy on Singapore from the foreign investors' and foreign business' perspective? But over the long term, this framework has to be one that will balance the needs of the local worker. At the same time, employers will also find it valuable over time as a resource to seek local employees more effectively than they would have in a tighter labour market.

The Acting Minister for Manpower (Mr Tan Chuan-Jin): Mdm Chair, with your permission, may I request for slides to be presented during the course of my speech?

The Chairman: Yes, please.

Mr Tan Chuan-Jin: I thank Members for sharing their views about our manpower policies.

As Minister and Member of Parliament, I have had the privilege to meet many Singaporeans from all walks of life. To me – and I think many of you would agree with me – this is probably one of the most meaningful parts of life in public office. They share with me a slice of their life stories. I have listened to their aspirations and hopes for themselves and, especially, for their children. They work hard and seek to have good jobs, stable jobs, good incomes, to buy a home and save for their retirement and also for their children's needs.

Low-income families worry about how to make ends meet; young graduates worry about competition; mid-career workers worry about whether they have enough savings when they retire, and business owners worry about rising costs and manpower constraints, as many Members have shared over the past few days.

Sometimes, there are contradictions and tensions. Some Members would have encountered this as well. Some feel that we should slow down and smell the roses, and in the same conversation later, express concern about whether we will be sufficiently dynamic and vibrant, so that we can create good opportunities for their children when they grow up; or whether the economy would be strong enough to provide for all their needs when they themselves grow old. Some will grumble about the fickleness of our local workforce, how they are very picky, how they will job-hop at the slightest opportunity for pay increments, and that we should loosen our foreign manpower policies. But in the same conversation later, they will lament about the loss of character in Singapore with too many foreigners here and, of course, the crowdedness they encounter every day. I will always ask them, "Which part of your request would you like me to fulfil?" I suspect they probably want answers to both parts.

On our part, we have to listen and, ultimately, we have to discern and decide what is the best option. It really is never about just doing more. We have to face the inevitable trade-offs even as we still try to settle for win-win outcomes wherever we can. There are always competing demands to balance.

Our responsibility as a Government is to provide for our people's needs, and this forms the bedrock and foundation for them to pursue their dreams and to achieve their aspirations. We are responsible for not only the individuals but also for the broader community. The needs are not always exactly the same. We also have to be responsible for our future generations by ensuring sustainability in all the things that we do.

The practical side of governance need not be incompatible with the aspirational desires and values that many of us share. Making our economy work for every Singaporean is at the core of what we need to do. Better jobs and higher incomes for Singaporeans are at the centre of our mission at MOM. How we do it will reflect the values that we hold. Achieving it will also provide us with the ability to realise those very aspirations and ensure that Singapore remains a nation of opportunities for our people.

Let us take a look at the present. I will first update Members on the present state of our labour market before going on to the future economy and other issues. Our economy grew by 4.1% last year. The unemployment rate, which is 2.9% for Singapore citizens, is among the lowest in the world.

To Mr Gerald Giam's question, I am especially encouraged that Singaporeans, in particular older workers and women, have benefited from our economic restructuring efforts. The labour force participation rate of women aged between 25 and 64 rose quite significantly over the decade, from 61% in 2003 to 72.2% in 2013. The labour force participation rate of older citizens, aged 55 to 64, also climbed to 66.8% in 2013 from 47.2% in 2003. This is quite a significant improvement over the past decade. Mr Gerald Giam raised the issue of the economically inactive and those who are discouraged. I think that is important. We are particularly concerned about this group. There are many diverse challenges that they face and we are trying to do what we can.

Senior Parliamentary Secretary Hawazi Daipi will elaborate further on our efforts and some of the measures that would help in this area. Some have been out of the workforce for quite some time. They do need substantive support and skills training to improve their employability. This is why we heavily subsidise training programmes through our Continuing Education and Training (CET) system to help them pick up skills, so that they can re-enter the labour market. We have also introduced WorkPro to incentivise employers to hire them. Clearly, it is not just only about skills, it is also about hand-holding, because many of them would be discouraged. They also do lack the confidence to return to work. So, we have started traineeships where we attach trainees to companies to undergo on-the-job training programmes. This enables them to try out and adjust to working life again and, hopefully, they can transit to actual work and thereby rejoin the workforce.

Singaporeans have benefited from economic growth. It is important for us to understand that without economic growth, many other things will not be able to follow and we are better off than we were previously. For example, growth in real median monthly income – and this includes CPF contributions – for full-time employed Singapore Citizens was 4.6% in 2013. Over the past five years, from 2008 to 2013, real median income increased by 1.7% per annum. This is not bad, considering that many countries are also facing wage stagnation. That is for the median income. Let us look at the lower percentile, the 20th percentile. The real income growth for them was 2% per annum, keeping pace with real income growth at the median level.

The foreign manpower tightening measures that were introduced over the past years are beginning to bite, which explains the concerns that many Members have expressed. Many of us have received the same feedback as well. In 2013, foreign employment, excluding Foreign Domestic Workers (FDWs), grew by 48,400, down from the increase of 67,100 in 2012. About two-thirds of this growth was driven by the Construction sector, and we understand why. There are a lot of infrastructure projects that we need to fulfil. If we exclude the construction sector and FDWs, foreign employment grew by 16,800 in 2013. This is about half of the growth of 32,200 in 2012, and the lowest growth since 2009. Having said that, we still have some way to go in terms of reducing overall foreign manpower reliance. So, that effort needs to continue.

When we compare ourselves to other advanced economies, and when I meet my foreign counterparts, it becomes quite apparent that we are in pretty reasonable shape. While certainly not perfect, we should not shortchange ourselves; what we have here is respected and admired. We need to continue to build on it and not take it for granted, to continue to strive and improve where we can.

Ms Denise Phua and Mrs Lina Chiam asked very important questions about our future – the competencies that we may need and the impact of technology. Let us take a quick glimpse at what the future might be like.

We believe that Singapore's future economy will create many diverse and exciting career opportunities for our people. We are well-placed in our region to ride on the growth that is happening around us. We are transforming our economy to develop higher skilled, higher value industries. While Mrs Lina Chiam has expressed some of these concerns, I can assure her we are not taking it for granted, and we are definitely seeking to transform, as much as possible, where we can and where it makes sense. New growth opportunities will emerge as technologies like data analytics, robotics and 3D printing become more pervasive.

The future economy will be driven by rapid technological change and shorter skill cycles. Longer life expectancy and shorter skill cycles mean this – workers, both white- and blue-collar workers alike, are unlikely to just have one career for their entire lifespan. In all likelihood, there may be two or more distinct careers over their working lives. Therefore, it is crucial that workers are able to master new skills, adapt, evolve and move on to new things. Change will be the permanent feature.

Let me just cite one example. We all remember Nokia. We used to have Nokia phones and MMI was great, and you cannot imagine anyone else doing any better. In 2005, Nokia had about a third of the world's mobile phone market. But it failed to adjust to iPhone's introduction in 2007 and evolving smartphone technology. By 2009, its profits fell sevenfold and it was sold to Microsoft last year.

Today, smartphone technology continues to evolve. A single messaging application – WhatsApp – can be valued at US$19 billion. We are seeing wearable mobile electronics, such as Google Glass and Samsung's Gear. Our workforce of the future should have both the hard and soft skills to competently adjust, not to mention also the soft aspect, the ability to communicate with acronyms, hashtags and the emoticons! So, let me, perhaps, for the first time, introduce emoticons into Parliament.

This is exactly why workers – and I would add and emphasise – including PMEs, must be able to adapt to change and have that commitment to lifelong learning. Ms Jessica Tan talked about the need to help our workers adapt and to move on. That is something that we are committed to. MOE is doing its utmost to continuously strengthen our education system. On MOM's part, we believe that our cutting edge would be our Continuing Education and Training (CET) systems. This is where we will raise the quality of our local workforce, especially as the world adjusts and moves on, we will be able to respond quite quickly. I totally agree with Ms Denise Phua's comments about the way we teach and learn. That is something that we will have to embrace. It is happening in the classrooms. When I was in the army, that was something that we were moving on in a very big way.

In the CET realm, that is something that we need to go on to as well. To better prepare for our future, our entire system needs to help us build a broader and deeper foundation for learning, and enable our people to be adaptable in picking up new knowledge and skills throughout their lives. Mr Teo Siong Seng expressed concerns about PMEs and their re-employability. Let me emphasise this again. Sometimes, we do get feedback that people look at CET as something that is required for blue-collar workers. CET is something that everyone needs to embrace and PMEs themselves also need to embrace it and participate in it. We will do our part to support it as best as we can with programmes and assistance. For example, we tried out the PMEs Specialist Assistance Programme.

The composition of the workforce will also change. Some Members have made mention about that. We know that more are aspiring to enter University – as Asians, that is probably particularly more acute. As a result, we see increasing numbers of graduates entering the labour market. By 2020, we will see 40% cohort participation in our local Universities. There are also many who are pursuing private education and overseas degrees. In theory, what this would mean is that we would be able to increase the pool of better-educated employees in Singapore. We will have a more skilled workforce. We should also be able to move up the value chain. Mr Teo Siong Seng recognises this but he is also concerned about what would the impact be on the lower-end jobs. In fact, we see these trends happening elsewhere as well.

We need to understand that these jobs will only be created by good companies. These companies, both local and foreign, will only be in Singapore if we have healthy economic growth and also a conducive business environment. Let us not kid ourselves; the competition is real. It is not about "if" but it is about "when". Companies will move; companies will go. Labour capital is exceedingly mobile and, increasingly, will continue that way. We do need to compete to have the companies, even our local companies, to remain here, so that these jobs can be created and those opportunities can be provided for our children as they grow up and as they pursue their education opportunities.

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Therefore, it is important for us to understand that even as we look at providing for our people across the different areas, especially on the social side, we still need to make sure that our future economy needs to be strong, robust, healthy and vibrant, so that these opportunities can be created for our people. That is the base upon which they can then go on to fulfil their dreams and aspirations. It has to go hand-in-hand. Our economic agencies will do what is possible to continue to anchor Singapore as a regional headquarters for high value-added activities, while helping local enterprises to grow as well.

Other countries are facing a different type of challenge. Mr Zainudin Nordin raised similar concerns. In particular, we should note the situation in South Korea and Taiwan. Mr Zainudin cited some examples in Japan, and we can see some of these trends happening across the world. In South Korea and Taiwan, there has been a relentless pursuit of paper qualifications. It has resulted in a glut of graduates. The Director-General of Taiwan's MOE stated that "the abundance of university places had undermined the quality of degrees and created a skills mismatch in the job market. People have become over-educated and under-employed." Taiwan is taking steps to address this.

But again, this is something that we need to observe. We can potentially see some of these trends happening. So, we cannot take for granted that we will not face these problems in the future. I was talking to Education Minister Heng Swee Keat last night and we were discussing about our respective parts in the Budget today. This is one area that we are watching carefully the developments. It is important for Singaporeans to make informed educational choices, not just the individuals but especially the parents. We will also develop viable career pathways and options for those who may prefer a more vocational and technical route instead of pursuing a University education. Singaporeans should not have to feel that the only way that they could be successful in life would be to pursue a University education. As we all know, if everyone becomes a University graduate, which theoretically could be possible, we will not have enough jobs to go around as well.

Correspondingly, the market would also respond to the quality of degrees that come from different institutions. The ASPIRE Committee that is helmed by Senior Minister of State Indranee Rajah will play a very important role to help address this situation. This is one area that we are particularly concerned about and we will pay attention to that. I agree with some of the concerns raised, especially from Mr Zainudin Nordin. Ultimately, as people move up the value chain in terms of the education process, we need to make sure that we continue to create jobs. That is key. For many countries that face some of these problems, they are not creating enough jobs. That is something that we are doing fairly well at the moment. We should not take it for granted. We need to create jobs at various levels, not just at the graduate level, but also at the non-graduate level – the vocational level, technical level – so that good job opportunities abound for Singaporeans at all levels because all of us do have different potentials and abilities. At the same time, we should equip our people with the skills and facilitate the information transfer so that we know where the jobs are. It is an entire continuum of effort.

Going forward, we must continue to restructure the economy, and change the way jobs are being performed. Restructuring for higher productivity will be painful. There is no way around that. We need to invest more in technology, streamline processes and create higher value products through innovation. This is the only sustainable way to ensure wage increases for all workers.

But let me end this section about the future by stating that even as we transform the economy, there will be natural limits to what education and training can do. There will still be Singaporeans working in lower skilled jobs. We will do what we can do to upskill them, but that segment of society will remain even as we go forward. What we need to do is to not neglect the contributions of Singaporeans at that level. They continue to play an important role in our society and we will and must continue to support them in their endeavours.

Given how the future may unfold, how do we ensure that our economy will work for all Singaporeans? I will highlight three areas: (a) creating better jobs and raising incomes for Singaporeans through upgrading our workers and supporting restructuring; (b) achieving inclusive growth and retirement adequacy; and (c) making sure that workplaces get better and are safer.

Firstly, creating better jobs and raising incomes through upgrading the workforce and supporting restructuring. We all know that raising productivity is central to our efforts to create better jobs for Singaporeans.

For businesses, it means taking a long hard look at their business models and processes, to see how they can produce higher value goods and services, and reduce their overall reliance on manpower. We are already seeing some changes. Many Members may have noticed when eating out that more F&B outlets have started using iPads for food orders. Others are asking customers to pay at the cashier on their way out, reducing the number of service staff required. So, do not get annoyed. This is an inevitable part as we tighten, as we move up the productivity and value chain. These are practices that will be there. All of us, as consumers, have a part to play by supporting this effort.

Other companies are finding different ways to deal with it. For example, I hear this story of Jellyhearts. It is a bakery selling customised cakes. The owner is Mr Darren Loh. He partnered e2i to prototype moulds that will help reduce the overall time taken to produce these customised cakes. When we took this picture, we wanted him to show that mould. But he said that it was a trade secret, so he could not show us. The key thing to this is this: the workers at Jellyhearts saw an eventual wage increase of about 10% to 20% as a result of improved productivity. This is why productivity is an important effort. Not only will it allow us to streamline our economy to be manpower-leaner, but at the same time, it will allow us to help our workers to earn more wages. Because only with productivity can income increases and wage increases happen.

I agree with Mr Zainudin Nordin when he says that, for workers, raising productivity means undergoing training to improve their skills so that they can add more value to their jobs. The Government is committed to providing Singaporeans with the fullest support possible to improve their skills through CET. This is a cutting edge and we will support that. We are in the midst of a major review of our CET Masterplan, and we will make our CET system even more relevant for our workers and businesses, and to further strengthen the link between training and skills utilisation at the workplace. So, the participation of employers is important, because their feedback will shape the kind of courses that we run, so that they will be applicable and relevant for the workers, and when they are trained and re-enter the workforce back to the companies, they are completely relevant.

This is a real tripartite partnership. This is something that we can make it work and work well. This will ensure that our workers will adapt quickly to industry needs and provide Singaporeans with more assistance to achieve their career aspirations. Senior Minister of State Amy Khor will be elaborating on this in her speech.

Let me address the point raised by Mr Png Eng Huat about tower crane operators.

We know that the demand for crane operators is increasing, largely in terms of where we are going for the construction industry, not just by the volume of work, but we are also pushing the industry to adopt much more prefab approaches, so crane operators play a very important role. In terms of numbers, for local crane operators, they have increased in the last couple of years, from 3,600 to 4,600. Foreign workers have increased from about 1,600 to 2,950. There is also a Dependency Ratio Ceiling (DRC) imposed. At present, we have a transitional DRC where you need one Singapore crane operator before you are eligible to hire another. You can hire up to four foreign crane operators. The idea is to transit to a ratio of 1:2 by 2017.

For Work Permit crane operators, only Malaysians are allowed. For S-Pass, we also allow crane operators from China as well. While we recognise that there may be some concerns, I would appreciate if Mr Png could flag out those specific cases. I also face residents who come to me for crane operating jobs, not of the nature that Mr Png had mentioned. I am quite distressed because when I arrange for jobs, they go and work and then they drop out for a host of reasons. It is not an easy job, mind you. We also find it challenging because for many Singaporeans who may not be able to find other jobs, this becomes a very suitable option. We find that some of them are quite reluctant to take on that job, I think for good reasons. Ultimately, we leave it to the individuals to decide.

What we need to do is to support that local pipeline. Similar to what we mentioned earlier, how do we support in terms of training? We have a crane operator apprenticeship programme. For example, we offer various types of crane operations and provide apprentices with an attractive monthly remuneration package of at least $2,500. It is a one-year programme and it offers training for them. On completion of the training, to obtain a crane operator licence, these apprentices will commence employment with their employers and undergo on-the-job training and future upgrading courses which are also subsidised. After completion of this programme, apprentices will qualify for BCA's CoreTrade registration. BCA has received an overwhelming response from local applicants and we will also facilitate in the placement process.

This is just to illustrate how we can support from the training perspective and also from the job placement perspective. This is what we mean when we talk about supporting our workers in terms of their employability and upskilling as they move to other sectors.

In terms of inclusive growth and retirement adequacy, we do know that many Singaporeans are worried that they do not have sufficient savings for healthcare and living expenses upon retirement. Some of these issues have been touched upon. MOH will cover quite extensively some of the programmes that we are looking into, to assure Singaporeans. Those are important. It is also important to make sure that those packages are sustainable. This is something that many countries are grappling with. Others have also shared their concerns over the more vulnerable groups of Singaporeans who struggle to make ends meet and have fewer opportunities to move ahead.

We remain as a Government committed to fostering inclusive growth. Much of what we have done – not just this year but in the last few years – has indicated that that is something that we are placing emphasis on. We want all our citizens to enjoy the fruits of our economic success to achieve financial security for themselves and their families.

Work is the best form of financial security. Our strategy at the broadest level is to keep unemployment low by keeping the economy healthy so that good jobs can be created; and at the same time, maintaining a tight labour market and encouraging more to work. With increasing life expectancy, many Singaporeans are able and want to work until they are older.

As announced in Budget 2014, we will be increasing the CPF employer contribution rates to the Medisave Account for all workers. Older workers will also enjoy further increases to the CPF contribution rates to help them build up more savings for their retirement needs.

I share the concerns of Mr Christopher de Souza and recognise that certain groups of Singaporeans will remain there, even as we transform. Particularly, lower-income Singaporeans will require more help. Mr Teo Siong Seng, Mr Gerald Giam and Ms Denise Phua also asked how the Government can assist retrenched mature workers, the unemployed and other vulnerable groups. This is important not just from MOM's perspective but from a whole-of-Government perspective to support them, not just in terms of work but also education, health, housing and so on.

Workfare remains the key pillar of our social security landscape. It is one pillar but it is an important one. We made enhancements to the Workfare Income Supplement (WIS) quantum and income cap last year, to boost take-home pay and retirement savings of low-wage Singaporeans. We also further enhanced the Workfare Training Support (WTS) scheme, to provide greater subsidies for training. With better skills and capabilities, our low-wage workers can raise their productivity and employability to enjoy positive wage outcomes. We need to continue to build on this to help more of our workers move up the value chain for themselves and, ultimately, for their families.

For the unemployed or those seeking a career switch, they can tap on the existing networks of Career Centres at CDCs, e2i and also CaliberLink, which is focused on helping the PMEs, to enjoy employment assistance and training advisory services. We also have targeted career conversion programmes to help individuals reskill and acquire necessary competencies to take on new jobs. Senior Minister of State Amy Khor will speak more on these efforts and retirement adequacy, while Senior Parliamentary Secretary Hawazi Daipi will touch on measures to uplift low-wage workers later on.

We are also paying particular attention to lower-income Singaporeans, especially for those who work in industries that are more prone to stagnating real wages. Where productivity improvements do not translate well into wage increases, for example, in sectors where there is cheap sourcing, I am glad that the unions are also working closely with us on this. We plan to introduce sector-specific and targeted measures. We have done this by incorporating the Progressive Wage Model, which is developed by NTUC, into Government regulation for the cleaning sector. We will also set up a tripartite body to assess the need for a Progressive Wage Model in the Landscape sector. Senior Parliamentary Secretary Hawazi will further elaborate on this.

It is important to move in these sectors for a range of reasons, one of which is what I alluded to earlier. There will always be Singaporeans, despite whatever efforts that we have made to try to uplift them in terms of educational level, who may continue to work at some of these lower-skilled jobs. That is why having the Progressive Wage Model in these sectors is particularly important because these are viable, respectable jobs that Singaporeans can take up.

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It is essential that as we carry out these various measures, we need to continue to make our workplaces better and safer. We will re-double our efforts to entrench a safety mindset and culture in the workplace. In 2013, we had 59 workplace fatalities, a slight increase from 56 in 2012. The Construction sector continues to be the main contributor to workplace accidents. In the first two months of 2014, we had nine Construction workplace deaths. This is quite unacceptable. We will step up enforcement efforts against errant employers, who will face harsh penalties under the law, including imprisonment.

Harsh penalties aside, the key to having a safer workplace is about having a safety culture. It is not just like about building the big stick, which plays a part, but, more importantly, we must all embrace that mindset. That is not easy to mandate but it is something that we will continue to promote.

As we build safe and healthy workplaces, we are also embarking on encouraging progressive workplace practices. This is the part about a better workplace. Singaporeans have increasingly indicated a stronger desire to have a more fulfilling pace of life; more time to pursue other goals and priorities outside of work. Many have called for greater support for flexible work arrangements and more pro-family practices. We will strengthen our efforts on this front to promote more progressive employment practices, to support work-life priorities for Singaporeans. Senior Parliamentary Secretary Hawazi Daipi will talk more about this. Again, some things can be mandated, but a lot of it is also about culture. A lot of it has to do with the fact that we need to look at ourselves as employees in the way we work and look at ourselves as employers as well, in the way we make our demands upon our employees.

Even though the Employment Act was recently amended to protect more Singaporean workers, Singaporean PMEs who earn more than $4,500 a month and fall outside the scope of the Employment Act have approached NTUC and MOM for assistance on workplace disputes. There are cases where employees have legitimate grievances but might not be able to afford to take legal proceedings. MOM is presently working with our tripartite partners to enhance employment dispute resolution mechanisms, as part of the Employment Act Phase Two review. We are looking to provide an affordable and expeditious avenue for employees to resolve disputes relating to breaches of individual contract of employment. As part of this review, we are also looking into how we can enhance the current tripartite mediation framework for union members in non-unionised companies. We are discussing with relevant stakeholders and we will provide an update in due course.

Let me now return to our efforts to restructure the economy. Mr Teo Siong Seng and Mr Dhinakaran have expressed the strains the businesses are feeling, due to the tight labour market and rising business costs. In fact, many of you have raised this in the past few days. As Minister Lim Hng Kiang shared yesterday, we are keeping close tabs with the ground. We have been receiving this feedback ourselves. Some of these business people are not your big businesses; they are small SMEs in your local area; and they are struggling because, for some of them, it is really a matter of life and death. Ms Jessica Tan spoke at the time about how it is so important to access to quality manpower because it is key for businesses to locate high-value operations in Singapore. As I mentioned, this is important because, ultimately, when that happens, job opportunities are created for us.

Let me share with Members a recent dialogue that I have had with Pasir Ris East residents. You could see their tensions. Mr Benjamin Wan, a resident, shared how he was affected by employers who, he claimed, preferred to hire foreigners to locals. Some Singaporeans, like Mr Wan, wanted us to be more stringent on admitting foreign talent; others call for a "Singaporean first" policy.

At the same dialogue, another participant, Mr Leong Weng Kuan, lamented about our tightened controls on foreign workers. Mr Leong runs a local business and shared how difficult it was to find locals to fill jobs that are available in his firm. Mr Leong was less concerned about PMEs as he felt that these Singaporeans are quite mobile and that there are already significantly good career opportunities for them. Within one dialogue, we could see divergent views – both equally valid in some sense, but how do you strike that balance?

I have one over-riding consideration when I look at how to shape our manpower policies. Do they, on balance, benefit Singaporeans and Singapore? I had mentioned earlier that it is critical that our economy remains healthy so that good jobs can be created to meet the needs of a better-educated workforce. As a country with a small domestic market, it is important for us to understand that we need to remain open to the global economy. It is our lifeline. It enables us to thrive and create those opportunities that we have been talking about. An important part of this equation is to have a diverse global workforce that allows employers to tap on skilled foreign manpower who complement and augment. Some global and even regional set-ups, need a cosmopolitan make-up due to the nature of their business and the reach. Yes, it will mean that when foreigners are here, they will compete for jobs, but yet, at the same time, by being here, it allows companies to be here and at the same time, generate those very jobs that go to our people. These jobs are generated directly from the jobs created in these companies, and indirectly from the business that is generated by having those companies here in the first place. Again, it is a fine balancing act.

We also know that given Singapore's physical size – we have discussed some of the concerns in this House because of the constraints and the infrastructure – we really do need to grow within the constraints that we have. This explains why we need to tighten foreign manpower access at all levels. Again, you can see that there is a balancing effort that needs to be struck here: that between maintaining our competitiveness and the need to moderate growth in our labour force. We need to ensure that whatever the trade-offs, that these trade-offs are real. On balance, what is the net effect? Is it positive for our people? Is it positive for our society?

We have introduced tightening measures in a progressive manner since 2010. Foreign employment growth has slowed down significantly, for the non-Construction sectors. We know that many local companies, both SMEs and non-SMEs, are feeling the pain. Take Yang Kee Logistics, for example. This is a local SME with more than 60% local employees. The company provides end-to-end logistics solutions for various sectors. Similar to many logistics firms, Yang Kee faces difficulties in servicing their clients, given the tighter manpower situation.

Yang Kee has adapted by forming an alliance with four other transport companies to pool excess trucking capacity through an order exchange cloud server. This has helped to alleviate manpower constraints in its trucking positions, as companies are able to fully utilise the resources at their disposal. The companies are also able to tap upon each others' expertise and enjoy access to resources previously unavailable. So, this is a classic example of how some companies have embraced change. These changes have allowed Yang Kee to enjoy productivity improvements of up to 20%.

We want our SMEs to do well, we want them to adapt, we want them to continue to create good jobs and opportunities for Singaporeans. But we cannot proceed with business as usual. We will be committed to helping companies like Yang Kee transform their existing business models. This includes support through the Productivity and Innovation Credit (PIC), which has been extended until 2018 and other schemes, such as the new PIC+ that is targeted at SMEs specifically. The feedback that Members have provided in terms of making sure that these PIC schemes are easily accessible remains an important one. We will continue to improve on that.

I want to take this opportunity, and I think it is important to do this, to remind all businesses that a few of the foreign manpower tightening measures that we had previously announced will take full effect this year and in 2015, when the transition period ends. Often times, we get feedback, "How come you suddenly change policy?" We have not. It has been announced; we have given time for transition. We would like to remind all businesses that this is going to happen in July this year and in 2015. This includes the higher S Pass minimum qualifying salary, and the reduction in Dependency Ratio Ceilings (DRCs) and S Pass Sub-DRC from 25% to 20%. Members will be glad to know that we are not introducing further tightening measures this year, with the exception of the increase in foreign worker levies for the Construction sector. We will monitor foreign manpower growth and productivity improvements in each sector carefully, before deciding whether any further measures are necessary.

I would like to thank Mr Zainudin Nordin, Mr Yeo Guat Kwang and Mr Teo Siong Seng for their views on the foreign workforce. The measures that we have announced in the Budget this year signals our intent to raise the quality of our foreign workforce and, by extension, productivity. We need to encourage firms to recruit and retain skilled foreign workers, and move towards having a slightly smaller pool of skilled foreign workers, rather than just relying on sheer numbers of inexperienced and low-skilled foreign labour. That transition must happen; we cannot grow at the same rate as before.

Therefore, we have introduced a new Market-based Skills Recognition Framework for the construction sector. This is to encourage firms to retain experienced "Basic Skilled", or what we call the R2 Work Permit Holders for a longer period, on higher salaries. With this, companies can upgrade their R2 workers to "Higher Skilled", or R1 status, and therefore, will not have to bear the higher foreign worker levies that we announced in Budget 2014. We will also extend the maximum Period of Employment (POE) for R1 workers from Non-Traditional Source (NTS) countries and the People's Republic of China (PRC) who work in the Construction, Marine and Process sectors.

Together with MND and BCA, we will also be consulting the industry on a longer term proposal to impose a minimum level of R1 workers across all Construction firms.

We will also review our Skills Recognition Framework, and the eligibility criteria for foreign workers to qualify for R1 status. We want to ensure that we raise the quality of the foreign workers here and encourage employers to retain experienced and skilled workers. We have already begun discussions with firms in the Process sector, and will soon be extending this review to cover the Marine sector. We encourage companies to provide your feedback to us. In response to Mr Yeo, we feel that the situation is less pressing for Services and will not extend this move to that sector.

These measures will mean that firms that are more reliant on new, inexperienced workers, or who choose to constantly churn foreign workers, will be subjected to higher levy bills. I think this makes sense. Conversely, firms that rely more on experienced, higher quality workers, will be less affected.

As I had mentioned in Parliament in January, while the situation with regard to our foreign workers' well-being is generally good but we do intend to improve where we can. Mr Yeo spoke about holistically and deliberately planning for the needs of our foreign workers, not just in their workplaces, but also where they live and play. Indeed, this has been so in our on-going efforts in managing the foreign workforce in Singapore. Since 2008, an Inter-Ministerial Committee has been looking into issues, such as foreign worker housing and transport. One of our on-going priorities is to speed up the construction of dormitories so that foreign workers can stay in these purpose-built accommodations. As part of these efforts, we intend to enhance our levers with the larger foreign worker dormitories by developing new regulations. I mentioned previously that the Government will also be launching more dedicated foreign worker recreation centres. In all, these measures will enable us to better meet the evolving needs our foreign workers face as well as to facilitate a more harmonious co-existence with the communities in the vicinity of large dormitories.

I would like to take the opportunity to thank Mr Yeo for his leadership and his team, and to congratulate the Migrant Workers Centre (MWC) and the Private Bus Associations on their initiative to enhance weekend transport for workers. We want to celebrate such ground-up initiatives because they will definitely play a part in complementing whatever that we are doing. And we encourage and hope to see more of these efforts.

We regularly review our legislation to ensure adequate protection for workers. We will study Mr Yeo Guat Kwang's suggestions to facilitate electronic salary payment and we have already begun discussing with industry on how to broaden the circumstances under which foreign workers may change employers, with a view to reduce the churn of experienced workers. This is something that MOM has been looking at for some time and I am particularly keen to take this forward, to see if we can make this possible.

With regard to having a standardised employment contract and sector-specific guidelines, a sample contract covering key employment terms has been worked out in consultation with the tripartite partners, and this has been made available on the website of the Tripartite Alliance for Fair Employment Practices (TAFEP). We further welcome any efforts by industry associations to come up with sample contracts covering specific terms that are relevant to their sectors. Please do come forward with your suggestions.

With a large and diverse workforce, invariably and inevitably, some employment disputes will be inevitable. I would like to reassure Mr Yeo and Members of this House that where these involve basic employment standards under our laws, we will ensure that standards are upheld. We will continue to build on existing processes for NGOs like Migrant Workers Centre, HealthServe and so on, to help workers seek assistance from MOM. MOM will also continue to step up enforcements against contraventions of the Employment of Foreign Manpower Act (EFMA). In 2013 alone, we prosecuted about 550 employers for EFMA contraventions.

Mr Dhinakaran raised a suggestion to further segmentise the DRC for the Services sector. We have debated this in the last several debates. We have applied our foreign manpower policies consistently across the Services sector. However, in exceptional circumstances, we have been flexible. Healthcare is one industry where we have granted more liberal controls, due to their essential nature and an acute shortage of trained locals.

We do not rule out further flexibility where warranted, but we would want to be assured first that the industry is essential, that productivity is already high, and that the locals therein are relatively well paid and have reasonable career and wage progression pathways.

For industries appealing for more generous foreign worker quotas and lower levies, we need to ask whether the industry is as manpower-lean as it is in other developed countries, whether the local workers are paid fairly and, more importantly, are paid better than alternative jobs in Singapore. Because that raises the question of whether the wages offered are not as attractive as it should be and why these industries are not generating good jobs for locals.

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Mr Dhinakaran has also asked whether we should increase levies when we have reduced quotas. Well, we have looked at this extensively over the years and the point is, we do need to do both but in a judicious manner. Why? Firstly, despite the DRC cut, the number of Services work permit holders and S Pass holders is still growing, albeit at a slower pace.

Secondly, if the cost of foreign labour is significantly lower than local workers, firms will be incentivised to recruit foreign workers first on the basis of lower cost and will seek to maximise their usage of foreign workers.

Thirdly, too low a cost of labour will also delay and deter the adoption of labour-saving technology. That is the whole point. We need to move towards a much more manpower-lean economy.

Firms can reduce their levy burden by either becoming more manpower-productive to rely on fewer foreign workers, or in hiring higher skilled R1 workers where they are needed. The more foreign workers they rely on, the more levies they pay. It is quite a fair and simple principle, but I think it is meant to shape the economy so that we can move towards the direction that we are looking at. It sends a clear signal to less productive firms and industries that behaviours and business models will have to change in order to survive.

Let me next address the concerns raised by Mr Patrick Tay, over the relevance of the S Pass in our Work Pass framework.

The S Pass was introduced in July 2004 to enable companies to bring in middle-level skilled manpower, such as Associate Professionals and Technicians (APTs), to augment manpower gaps across various industries within a given quota. Even as our local workforce becomes more educated and skilled, the S Pass will remain relevant in two ways. First, there will still be APT manpower gaps which our local workforce may not be able to fill. In the 2013 Job Vacancy Survey administered by MOM, there were more than 4,000 APT vacancies reported by employers in September 2013, which they found hard to fill with locals. Second, more junior-level foreign PMEs will fall into the S Pass category as we progressively raise the Employment Pass (EP) qualifying criteria to level the playing field for local graduates, and they will be subject to the S Pass sub-DRC and levies. This forms part of our effort to raise the overall quality profile of our foreign workforce over time, so that they continue to complement our increasingly educated local workforce.

To strike a careful balance between meeting the manpower needs of industries and maintaining a level playing field for locals, we have been progressively tightening the S Pass qualifying criteria, raising the foreign worker levy and cutting the S Pass sub-DRC since July 2011. Most significantly, in July 2013, we required S Pass holders with more experience to qualify at higher salaries and further cut the S Pass sub-DRC for the Services sector from 20% to 15%, as locals do tend to look for jobs in that sector. As a result, Services S Pass growth has moderated from 8,100 in the second half of 2012, to 1,000 in the second half of 2013.

We will continue to monitor the situation closely as the effects of the recently announced S Pass tightening measures are still working their way through. We will continue to review the S Pass framework, to ensure that the quality of S Pass holders continues to meet the manpower needs of industries and complement our local workforce.

Mr Patrick Tay and Mr Zaqy Mohamed have asked for an update on the implementation of the Fair Consideration Framework (FCF), and the specific actions that we had taken on those with nationality-based discriminatory HR practices.

The purpose of the FCF is to encourage a level playing for Singaporeans and signal the importance of considering Singaporeans fairly for job opportunities. From 1 August 2014 this year, firms must advertise their vacancies in the Jobs Bank for at least 14 days before they are eligible to apply for an Employment Pass if needed.

The Government has started identifying firms that may have scope to improve their hiring and career development practices. These are firms with a disproportionately low share of Singaporeans within the PME levels in their industry. Since the start of this year, we have identified and started initial discussions with more than 50 employers.

Firms with shortcomings in their HR practices will be required to implement an action plan to address these shortcomings. In some cases, the issue may not be a problem with their HR practices , but rather a gap in the skills that are available in the local workforce. This happens. We will work closely with the industry, to explore ways to support manpower-lean business models or develop a local pipeline of workers with the relevant skills and experience. This is where MOM, MTI and MOE work closely to make sure that the local pipeline is provided for.

The new Jobs Bank will be launched in the middle of 2014. WDA is now in the process of engaging groups of employers and potential job seekers, to test the beta version of the Jobs Bank. As with all new platforms, I do not think it will be perfect from the word "go" and users will take some time to become familiar with it, but we will continue to refine and improve the Jobs Bank, as we gain more experience and feedback from Singaporeans and employers. This is an exciting development, and we see a lot of potential in this.

Mdm Chair, allow me to summarise in conclusion. While we have not announced major foreign manpower tightening measures for the non-Construction sectors in Budget 2014, businesses must press on with restructuring and should lose no time in making the adjustments needed to remain viable. As Members can see, some companies have moved on and have embraced the change. Many companies are now coming round to it and many of them have been appealing. Many Members have received the appeals but we do need to move on and many are beginning to respond, so that is encouraging. The fact is there will be casualties in any restructuring effort and it will be painful for many. But for those willing to adapt, the Government will help through our transitioning support package.

All of us – Government, employers and employees – play a part in our restructuring journey. This strong spirit of tripartism is a real strength for Singapore. In addition to restructuring their businesses, employers have a role to play to make their firms attractive places to work. This means paying attention to career and wage progression, engaging employees, and designing work arrangements that enable their employees to contribute their best to the firm. This has significant bearing in productivity. Are they prepared to go the extra mile for you? If we are able to pay attention to that, that would have a big part to play in productivity. Employers also have a significant role to play in training and upgrading their employees' skills. Singaporeans, too, must respond by seizing these training opportunities and ask what value we as employees can add to the firm and not simply focus on what the firm can offer to us. All of us really, have a part to play.

So long as we keep working together, we will continue to ensure that Singapore remains a Nation of Opportunities, for all Singaporeans.

Building Capabilities for Future

Ms Foo Mee Har (West Coast): Madam, as part of our growth strategy to entrench Singapore as the Global-Asia Hub, both Government and employers have critical roles to play in ensuring that Singaporeans have the capabilities and skills to take up the best jobs. I urge the Government to broaden the coverage of CET to include the development of Singaporean leaders to fill top regional jobs here. This will not only secure the best opportunities for our people, but also enhance our competitiveness with the availability of world-class management talent.

Currently, the typical approach taken by MNCs to fill top regional jobs is to simply send in senior managers from their foreign head offices or overseas branches.

This is partly because these organisations need their "man in Singapore" to have deep knowledge of the corporation's culture and processes and a well-cultivated network of contacts in the wider organisation. But I believe that Singaporeans can be prepared for these roles, if we provide them with opportunities to gain international experience.

The Government should launch a programme to encourage employers to proactively identify and groom top Singaporean managers. A key part of this programme should include sending high-potential (Hi-Po) executives on overseas job postings to either manage a large overseas market or to take on assignments at the head office.

These postings should be for about two years to be meaningful both to gain management experience in different markets as well as build wider networks in these large organisations. These Hi-Pos are then required to return to work in Singapore.

Such postings are costly undertakings for most companies. I propose that the Government consider off-setting their costs, as part of our efforts to build a strong Singaporean Core in strategic industries for the future.

Madam, in fact, nine years ago, in my previous capacity as the China Head for Standard Chartered Consumer Banking business, I supported the Asian Business Fellowship programme under MTI by sponsoring seven Singaporeans. Under this programme, the Government paid for the interns to gain valuable exposure in a fast-growing Asian market, whilst the Bank provided them with development opportunities in an international setting.

Madam, instead of just focusing on entry/mid-levels, we need a programme targeted at senior executives, which we may call the Future Leadership Incubation Growth and Hi-potential Programme or FLIGHT school, in short. This Top Gun programme will give wings to a Singaporean Core of world-class corporate leaders who can then help take the country soaring towards our aspiration as a Global-Asia hub.

_Second Skilling, Continuing Education and Training & Under-employment _

Mr Patrick Tay Teck Guan: Mdm Chair, firstly, I would like to thank the Acting Minister for agreeing to and supporting NTUC's call to look at the spending; the Tripartitie Mediation Framework and also expanding the employer dispute resolution for PMEs earning more than $4,500.

Our PMEs in Singapore remain vulnerable to a changing landscape and the economic restructuring. We have talked about getting PMEs to be equipped with T-shaped skills – the vertical part of T signifies a deepening expertise of a particular skillset or discipline whereas the horizontal part of the T signifies the ability to collaborate across disciplines.

Learning from the series of crises the past decade, the uncertainties of the global and local economy and having dealt with and engaged many PMEs in Singapore, I would like to put forward, the first time in this House, the concept of developing not T-shaped but π-shaped PMEs. Why Pi-shaped and the symbol π? Because the two verticals connote having two deep skills instead of just one deep skill. In other words, Pi-shaped also means second-skilling.

Why second skilling? We must not just develop competency and depth in one's main job but should equip ourselves with an additional backup skill or training that will come in to ensure employment and employability in the unfortunate situation of job loss or retrenchments.

As a real example, an IT programmer may have a passion for photography. His main deep skill is in IT programming but his second skill can be photography; professional photography. In the event he loses his job as an IT programmer, he can switch to being a professional freelance photographer to stay employed. Another example would be a banker who has a passion for counselling, possibly even a hobby for it. His second skill could be in counselling. Once he develops the deep skills of counselling, if there is a downturn and he is laid off from his banking job, he could still use his professional counselling qualifications to take on work as a counsellor or social worker in a VWO. The list and examples go on.

We seriously need a fundamental rethink of how employers, Government and PMEs should view second skilling and whether employees would be happier and far better off if they are allowed to explore new areas of professional development in their personal time. The employers can play their part; we will also need a shift in Government perspective in terms of how training funds can come in to support second skilling. This can come through by increasing the channels of deployment of the Lifelong Learning Fund and Skills Development Fund.

If we can expand the scope of Government funding for individual-initiated training, it will really help to facilitate the growth of second skilling, hence, assuring the employability and financial security for Singaporeans.

Previously, I have mooted actively for the establishing and linking of Lifelong Learning Fund to individual-based learning programmes rather than just relying on employer-centric training programmes. I am, therefore, pleased to note that there is a current trial on the Individual Learning Portfoilo by WDA that will provide a history or tracking of the individual PME's learning and development.

I recall vividly this. We had the Surrogate Employer Scheme in the past decade but which has now been overtaken by the Workfare Training Support Scheme. Can MOM or WDA continue the Surrogate Employer Scheme so that PME employees, some below 35 years and have PME level incomes, who are not supported by their employers and who embark on individually initiated training like embarking on Diploma or higher programmes in our local Polytechnics or reputable private education institutions enjoy funding and training allowance or absentee payroll? Madam, in Chinese, please.

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( In Mandarin ) : [Please refer to Vernacular Speech.] In this globalised world where people face stiff competition in the labour market, our local PMEs must plan ahead. I propose that we not only develop "T-shaped" PMEs, but also "Pi-shaped" as well. Why the Pi-shape?

This is because for local PMEs to have just one deep skill is not enough; they need to have two deep skills. A good example would be someone in the finance industry. If he has a passion for counselling and if he were to be retrenched during a financial crisis, he can also join the counselling industry to continue working as a counsellor. There are many such examples.

I hope that employers would continue to encourage and develop local PMEs so that they can master a second skillset. I also hope the Government can allocate more resources to help them.

The Chairman: Your time is up, Mr Tay.

Flexibility in Repayment of CPF Funds

Dr Intan Azura Mokhtar (Ang Mo Kio): Mdm Chair, currently, those who wish to withdraw their names from the HDB flat that is co-owned with their aged parents, in order to purchase a new BTO flat with the spouse or spouse-to-be, would require the repayment of the CPF funds used, with accrued interest by the remaining co-owners. The remaining co-owners are usually the aged parents. This repayment, usually in cash, has to be made within six months of the name withdrawal, back into the CPF account of the co-owner who has withdrawn.

I have met several residents who are in this very situation. One of them is Mr Yeo and Ms Liu, who are getting married and have applied for a new BTO flat. However, Ms Liu currently co-owns a flat with her aged parents which she has helped pay for over the past three years. She appealed to CPF Board to seek a waiver of the repayment of about $42,000 by her aged parents, back to the CPF account when she withdraws her name from the current flat. However, her request was rejected.

Mr Yeo and Ms Liu are not alone. In the past two-and-a-half years, I have met a few other residents who are in the same predicament. The reasons for wanting the waiver for repayment are reasonable. They are still young, they are working, and are capable of building up the CPF funds for retirement, but their aged parents, usually in their 50s or 60s, are not able to do so.

There is a strong sense of filial piety amongst these young Singaporeans who feel that waiving the CPF repayment by the parents is a small gesture of repaying their parents' kindness and sacrifices. And they feel that the current CPF policy prevents them from being able to proceed to purchase a new flat and may be an obstacle in them starting a family. I understand the reason for rejecting the waiver of repayment, which is to ensure enough funds for their own retirement in the future. But this is another 20 to 30 years for them.

I would like to seek MOM's consideration to review the existing policy for repayment of CPF funds used, and instead allow options where Singaporeans can decide to: (a) seek repayment of the CPF funds used as a lump sum; or (b) seek repayment of CPF funds used in instalments for an agreed period of time; or (c) waive the repayment of CPF funds used entirely. Impose caveats, if need be, but I hope that the Government can consider these.

CPF Nomination

Ms Lee Li Lian (Punggol East): CPF proceeds are distributed according to the intestacy law if the member did not make any nomination prior to his or her death, with the exception of our Muslim friends whose proceeds will be distributed under the Administration of Muslim Law Act.

The intestacy law states that when a CPF member is married, it will revoke a previous nomination. However, when a member goes through a divorce, it will not revoke the previous nomination unless the member makes a fresh nomination after the divorce or remarries. Unfortunately, many CPF members are not aware of this fact.

I have come across cases in Punggol East where there is confusion amongst the immediate relatives of the deceased, uncertain about where their relation's CPF money has been transferred to. Very often, family members approach the CPF Board to understand who the beneficiaries are but are turned away as this is considered confidential information.

This allocation process may not be in line with the member's wishes and their money may not reach the people whom the member feels need it most. For example, if spouse and children are financially self-reliant, the member might have wanted to provide for their elderly parents, disabled or unemployed siblings, grandchildren or even grandparents.

I would like to suggest to the Ministry to send notices to CPF members whenever their marital status changes so as to allow members to make changes to their nominations if they choose to. This will require some additional administration but it can help to eliminate confusion and pain for CPF members and their immediate families.

Section 73 of the Conveyancing and Law of Property Act (CLPA) has generated much controversy in the past. One of the contributing factors was lack of awareness. Similar to CPF nomination, members are not aware that their beneficiaries change according to marital status. It is timely to conduct a review of the consequences of the intestacy law and greater awareness must be generated to the public on how this will affect their CPF money.

Review of Minimum Sum

Mr Seng Han Thong (Ang Mo Kio): Although the increase in Minimum Sum for 2012 was about one-third lower than what it would have been, only about 50% of the active CPF members were able to meet the Minimum Sum at age 55 last year. For those who are unable to meet the Minimum Sum, many also have difficulty serving their housing loan. And many of them come to our Meet-the-People Sessions for help.

On the other hand, over the last 10 years, about 10%-15% of each cohort turning 55 has chosen to leave the balances in their CPF accounts above the Minimum Sum. These are sums of money that they could otherwise withdraw.

Thus, when the Minimum Sum reaches the target of $120,000 in real terms (2003 dollars) next year in 2015, may I know if the Government will conduct a review on the long-term Minimum Sum policy?

May I also suggest that the future Minimum Sum policy to have a tiered Minimum Sum targeting at different income groups, with higher income Singaporeans having bigger Minimum Sum and lower income workers keeping a smaller Minimum Sum?

In this House, we always hear this phrase: "not one size fits all". I say: "not one sum pleases all".

CPF Retirement Account

Ms Jessica Tan Soon Neo: With the Retirement and Re-employment Act (RRA), the statutory minimum retirement age is now 62. Employers are also required to offer re-employment to eligible employees who turn 62, up to the age of 65.

This year's Budget has also announced an increase in CPF contribution to Medisave and an increase in CPF contribution for older workers. With Singaporeans working longer and retiring later, marrying later, and more are single, should there be a refinement to the age requirement for CPF funds transfer to the Retirement Account at the age of 55 to meet the Minimum Sum? If individuals at age 55 are still servicing their housing loan, once the funds are transferred from the Ordinary Account to the Retirement Account to meet the Minimum Sum requirements, the individual may not have much funds left in his OA to continue to service his housing loan and his Home Protection Scheme (HPS) or Dependants' Protection Scheme (DPS) insurance premiums. This would mean that they would have to service this through cash and, in some cases, as Mr Seng Han Thong had referred earlier, the low-wage workers do have challenges meeting this.

I have had several cases of residents who come to see me at MPS where they continue to work and they are still making contributions to the CPF. And once their funds are transferred at the age of 55, they have problems meeting their monthly mortgage payments.

I do understand the logic for the fund transfer to meet the Minimum Sum to ensure retirement adequacy. But at the same time, I look at the cash flow implications for these individuals who because of that age change, but they are still contributing to CPF, are now facing challenges in their day-to-day servicing of their loans, as well as meeting their daily requirements.

The Chairman: Mr David Ong, you have two cuts. Please take them together.

Retirement Savings of Senior Workers

Mr David Ong (Jurong): Singapore is a rapidly ageing population and that translates to a fast-greying workforce. The changing demographic will require adjustments to be made by individuals and society at large. In particular, Government policies and attitudes of both employers and employees on retirement age, CPF and employment of seniors need to be re-calibrated to reflect the signs of our time.

For many years, in our policy to enhance the employability of older workers, we reduced the employer's CPF contribution. To-date, many of our older workers suffer a drop in their CPF savings. Older workers, as they age, would, therefore, suffer the double whammy of stagnated and reduced salary or a drop in employer's CPF contributions. Both combined worsen our older workers' retirement savings.

Budget 2014's move to further restore the CPF contribution rate for older workers will help them accumulate retirement savings faster and is a welcome move. But it may not be enough as older workers have faced reductions in their CPF contributions for many years. CPF savings is significant for our seniors, as they will depend even more on them for their retirement and healthcare needs.

In 2012, less than 50% of those who turned 55 were able to meet their Minimum Sum, whilst 40% did not meet the Medisave Minimum Sum.

Even with this Budget's attempt to restore CPF, our seniors' CPF savings will take a dive as they age. From next year, when they turn 55, their total CPF contribution will drop significantly by 10% and at 60, another 9% dip resulting in a 20% gap between them and their younger counterparts. Hence, the older they get, the tougher it is for them to shore up CPF savings for retirement and housing mortgages. This is especially so, given the changing Singapore demographic, where people are getting married and have kids later, upgrade their homes in their mid-career and thus may still be paying their mortgages and their children's education even when they are in their 50s.

As our workforce is greying and more are staying longer in employment well into their 50s and 60s, I call on MOM to move towards helping older workers grow their CPF retirement savings. Rather than tinkering with the older workers' retirement savings by using CPF as a calibrating tool to make them more affordable and employable, I hope the Government can continue to leverage on other levers, such the Special Employment Credit and now the Temporary Employment Credit, to help improve older workers' CPF retirement savings whilst assisting companies cope with rising costs.

On mindset change for employers, the Government can implement schemes where employers who want to recognise the contribution of their older workers can be motivated to voluntarily restore their CPF contributions.

Employability of Older Workers

Mdm Chair, it is important that workers remain employed longer as this will enable them to start dipping into their savings at a much later date, thus supporting financial self-sufficiency.

In my Budget speech, I asserted that staying employed for longer is not just important for financial reasons, but also for self-worth, dignity and productive ageing for our seniors.

MOM reported an improvement in the participation rate of seniors in the workforce, but we have also heard of many others who are unwillingly ushered into an earlier-than-planned retirement, are denied promotion, or are offered re-employment contracts with lesser pay and benefits even though they are re-employed to do the same job.

Let us start honouring our seniors in the workplace by paying them fairly. Our Civil Service has taken the lead in establishing fair and equitable compensation upon re-employment for Divisions 3 and 4 officers. More can be done to both the public and private sectors to accord our older workers a compensation based on merit and contribution, rather than on perceptions of productivity based on age.

The setting of a statutory retirement age perpetuates prejudices, stereotypes and age discrimination, thus creating barriers that prevent organisations from accessing and retaining the skills and talent they need.

Whilst the Tripartite Re-employment legislation provides the framework and flexibility for both employers and employees in re-employment, I would endeavour to seek an enhanced Re-employment legislation where we raise the re-employment age and do away with the statutory retirement age. Recourse for wrongful dismissal or inequitable compensation will be provided under this legislation regardless of age.

Hence, the removal of the statutory retirement age is, at its core, a symbolic but important step in changing the mindset and attitude of employers, to drive home the message that age is not a barrier to productive employment. Workers should be given the flexibility to choose how long they want to work or when they wish to retire. The important factor is the restoration of choice for our senior workers on retirement rather than being subject to a legislative policy.

However, the removal of retirement age does not necessarily mean that jobs will be available for older workers. The Government can and must do more to help our senior workers enhance their employability currency. At the same time, companies can extend the productive years of our older workers through deployment of productive technologies, re-designing jobs, adapt workplace practices and upgrade skills of older workers. If our companies are unable to adapt to an ageing employee profile, the economy will suffer from structural rigidities, ultimately, leading to job losses for all.

The Chairman: Mr Heng Chee How, you have two cuts. Please take them together.

Raising Re-employment Age Ceiling

The Senior Minister of State, Prime Minister's Office (Mr Heng Chee How): Thank you, Madam. Last year, I pushed for the Re-employment Age ceiling to be further revised from 65 years old to 67 years old in view of the ageing population of our workforce, the tight labour market, as well as for the self-esteem and dignity of our older workers. The Re-employment law was enacted in January 2011 and it became effective from January 2012. It has been two years of implementation since. And the outcomes – the employment rate of older workers aged 55 to 64 continues to improve, as shared by the Acting Minister earlier. The employment rate of those above 65 years old has also increased. And we can all see that the tight ongoing labour market conditions are favourable.

Another point to note is that workers who reached 62 years old in January 2012 will turn 65 years old in January 2015.

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I am glad that the tripartite partners have agreed to put this on the agenda to discuss and to learn from the on-going implementation experience and to see what measures need to be put in place to get ready for the next step. I would like to ask MOM whether there is a timeframe to aim at in making this move, as I believe that many older workers are looking forward to it. Such an indication would also help employers in their planning and in acquiring the know-how in good time.

Enabling Age-friendly Workplaces

Madam, my second cut is on enabling age-friendly workplaces. There are four manpower taps: school-leavers, labour productivity gains, retaining and prolonging the work lifespan of older workers and encouraging women to go back to work, and as well as imported manpower.

With prolonged low fertility, the pool of school-leavers will remain limited. Labour productivity improvement has been lacklustre in recent years. With tighter management of imported manpower, tapping the source of older workers cannot be over-emphasised.

At the same time, the labour market is very tight and employers are experiencing difficulty in filling vacancies. Furthermore, the citizen population is ageing, and many older workers value the opportunity to continue to contribute at work and to earn a fair wage.

Against this background, it is clear that both economically and socially, pervasive adoption of age-friendly human resource, operational process and job design practices will be critical to help both employers and older workers find a win-win path forward.

One clear hurdle is the cost of making these adjustments and improvements. In this regard, PIC grants help. At the same time, there is also the WorkPro programme which was designed to help spur the creation and improvement of age-friendly and flexible workplaces. I would like to ask MOM for an update of WorkPro's progress since its launch at last year's Budget session.

Money aside, I believe a potentially even bigger hurdle is the lack of know-how. Without sufficient know-how, companies are likely to carry on doing things the same way, whether from a productivity standpoint or from an age-friendliness standpoint, that is, knowing how to design things to be more age-friendly. They will then just seek ways to lower cost instead of finding ways to unleash value and that would not be a sustainable approach in our realities.

I, therefore, ask for MOM's assessment of the state of know-how of companies in designing and implementing age-friendly measures, both from the human resource as well as operational standpoints. What is being done to help companies acquire such know-how and to nudge them towards making concrete efforts to acquire such know-how and then implement them? In this process, is there a sufficient pool of age-related job and process re-design consultants for them to tap on and how can we better help grow this pool for them?

Employment Rate of Older Workers

Mr Seng Han Thong: A recent survey shows that many Singaporeans have their retirement plan but, in reality, they end up working longer than originally planned for various reasons.

The employment rate for our senior citizens aged 55 to 64 is now 66.8%. With more and more Singaporeans approaching the retirement age, may I know what is our longer term target of employment rate for older workers and what are the policies and programmes to encourage more Singaporeans to work longer and employers to engage older workers?

The Government's approach should be to create an economic structure that will make the older workers productive and are able to generate economic value. This is no different from EDB creating jobs for the graduates from University, Polytechnics and ITE. We can create meaningful jobs for the seniors and train them for these jobs.

The Senior Minister of State for Manpower (Dr Amy Khor Lean Suan): With your permission, Mdm Chair, may I display some slides on the LED screen?

The Chairman: Yes, please.

Dr Amy Khor Lean Suan: Mdm Chair, I thank members who spoke passionately about the need to ensure that our workforce remains responsive, relevant and resilient.

Acting Minister Tan Chuan-Jin mentioned the need to support the restructuring of our economy by promoting improvements in the quality of our workforce. I would like to elaborate on how my Ministry intends to do so. The main thrust of our efforts is to empower Singaporeans to embrace learning for life to meet the challenges of our collective future.

We cannot assume that what we know or do today will continue to be relevant. The future will bring new opportunities for all Singaporeans – many new jobs have yet to be created. A number of these jobs will be in new growth sectors that Ms Foo Mee Har, Ms Denise Phua and Ms Jessica Tan alluded to earlier. We need to prepare ourselves to take advantage of these opportunities.

I will first give an update on the broad-based measures that my Ministry has undertaken to improve our Continuing Education and Training system, or CET in short. These measures seek to better support our economic restructuring efforts and help our workforce seize the opportunities that restructuring will bring. I will then speak on our targeted efforts to reach out to two groups of workers who have more specific needs. Finally, I will speak about the issue of retirement adequacy.

Last year, as part of Our Singapore Conversation, MOM organised several sessions to hear what Singaporeans had to say about CET. As one participant said, "Learning is living; when we stop learning, we stop living. Lifelong learning is about how you create value for yourself." Our Government recognises that CET remains the cornerstone of a resilient workforce, and will continue to empower Singaporeans to improve themselves.

The story of Mr Jai Prakash illustrates this well. Mr Prakash, aged 47, sought assistance from WDA's Career Centre at North West CDC after being retrenched as a Distribution and Marketing Manager. He was keen to hone his skills as a trainer to widen his job options.

After understanding his needs, Mr Prakash's Career Consultant referred him for the Advanced Certificate in Training and Assessment (ACTA) course where he completed all six modules during a five-month period last year. On top of substantial course fee subsidies, he also received a training allowance.

His perseverance paid off when he secured a job through his own initiative as an Assistant Operations Manager with a logistics company in December last year, after being unemployed for eight months. He was able to apply his newly-minted skills gained from the ACTA course in his new role to train new staff in handling chemical products and managing inventories. Mr Prakash is currently pursuing the Singapore Workforce Skills Qualifications (WSQ) Advanced Certificate in Workplace Safety and Health conducted by NTUC Learning Hub, to further develop his skillsets.

At the Budget debate, several Members, including Mr Zainudin Nordin, had asked about the progress we have made in CET. Back in 2008, we launched the Masterplan to develop CET into a key economic and social institution that undergirds our economy, our competitiveness and helps Singaporeans stay employable.

Since then, we have more than doubled the number of CET centres from 19 to 51, and increased the coverage of WSQ frameworks to cover more than 30 industries, from Creative Industries to Precision Engineering. A total of one million workers have now been trained in WSQ. And with our two new CET campuses, more workers will be able to access CET programmes.

In addition, our Polytechnics and ITEs have quadrupled their academic CET programmes from about 40 in 2008 to over 160 programmes in 2013. Since 2011, these programmes have also been modularised to better meet the needs of working adults for flexible upgrading.

We also look at outcomes from the perspective of our workers and employers. WDA's latest survey findings are encouraging. Ninety-seven percent of our trainees indicated that they were better able to apply their skills, an increase from 93% in 2009 when the survey first started. Seventy-seven percent of employers felt that WSQ training led to productivity improvements, compared to 62% in 2009.

Mr Christopher de Souza had earlier asked about productivity and training for lower-wage workers, and I am pleased to share that our lower-wage workers, in particular, have benefitted from WSQ training. Based on another WDA study, from 2008 to 2010, lower-wage workers with WSQ Statements of Attainment (SOA) received wage increments of between 2.6% and 4.6%, compared to those without SOAs.

The progress we have made since 2008 has allowed us to fulfil the aspirations of more Singaporeans, such as Mr Low Weng Hoe. Mr Low graduated with a Degree in Network Computing and joined the IT industry as an IT executive, but subsequently decided to pursue a career in healthcare.

During a course for therapy assistants, Mr Low worked closely with therapists in the hospitals who dealt with neurological and geriatric patients. It was then that he discovered a passion for geriatric therapy. He enjoyed interacting with the elderly while assisting them in their exercises and felt a sense of fulfilment when he witnessed their recovery. In 2010, he won the WDA-Professional Conversion Programme award to do a three-year Diploma course in Physiotherapy. Although Mr Low is currently earning a salary which is 10% lower than his previous job in the IT industry, he has no regrets entering the healthcare sector.

We are also providing more support for our SMEs' training efforts. This contributes to the Government's efforts to transform the SME sector, as Deputy Prime Minister Tharman spoke about earlier in the Budget debate.

At last year's COS, I introduced the Enterprise Training Support, or ETS, scheme to provide a holistic HR and training package for companies to develop their employees and raise productivity. WDA rolled it out after we listened carefully to our SMEs, many of whom have asked for more help to develop their HR expertise.

By the end of last year, the ETS had benefitted 68 companies and approximately 12,000 local workers. Seventy percent of these companies were SMEs, and I am glad to share that feedback from the SMEs has been very positive.

Nonetheless, many SMEs also indicated that the tight labour market made it difficult to send workers for training. WDA will thus enhance the ETS to support e-learning and mobile learning from 1 April this year. This will provide more flexible training options for workers and, as Ms Denise Phua mentioned, reflect learning in the digital age.

Several SMEs have also told us that they found it difficult to access WDA's schemes and training programmes. Hence, since last year, through closer collaboration with the one-stop SME Centres set up by SPRING Singapore, SMEs that prefer one-to-one advice on training advisory or manpower development can approach WDA Programme Advisors at any of these five SME Centres.

Response from SMEs has been positive. Of the SMEs that approached the Programme Advisors, 40% eventually expressed an interest to tap on the schemes. In fact, the majority of SMEs engaged in this manner are small enterprises with less than 20 employees.

I urge more SMEs to tap on these services. A mindset of continuous improvement does not apply only to workers; employers are also important conduits for these improvements to take place.

At the start of my speech, I spoke briefly about the challenges of the future. CET is a key strategy in our response to these challenges. And we must actively look and plan ahead so that our CET system keeps our workforce agile in an evolving world fuelled by uncertainty.

Hence, as we announced last year, we are embarking on a major review of our CET Masterplan. Given the future challenges faced by our workforce, the review of the CET Masterplan will help to achieve the following.

First, to build a culture where individuals are better empowered to pursue their career goals and aspirations through CET. We will give greater emphasis to self-initiated upgrading to build a "career-resilient" workforce that embraces lifelong learning.

Second, companies need to take greater ownership of their HR planning. They can do this by more effectively integrating CET into their business strategy and performance management, developing attractive careers and wage pathways.

Third, at a systems level, we want to improve the responsiveness of our CET system to meet the evolving skills needs of growth sectors. More details on the revised CET Masterplan will be announced in due course.

Allow me now to turn our attention to two specific groups of workers, namely, the PMEs and our older workers. I thank Mr Patrick Tay, Ms Foo Mee Har, Ms Mary Liew and Mr Teo Siong Seng for their concerns about our PMEs. Let me set this issue in context. On the whole, our PMEs are doing well. For example, unemployment rates for Singapore citizen PMEs remain low at 2.5% in 2013, compared to 3.6% for all citizens. However, some PMEs are facing employment challenges, as alluded to by some of our hon Members.

On average, unemployed PMEs took longer to find jobs. The median duration of unemployment among those previously in PME jobs was 13 weeks in June 2013, compared to eight weeks for those from non-PME jobs.Fskil

While our unemployment rate is currently low, we cannot be complacent and expect it to remain that way. The number of PMEs in the labour market is also increasing. As the educational and skills profile of our workforce improves, the share of PMEs in the Singapore citizen workforce has risen from 25% in 2003, to 28% in 2013. And this number is expected to grow further.

Our efforts to provide broad support for PMEs to improve themselves must, therefore, be redoubled to help more to take on the jobs that have been created. WDA provides funding for training beyond WSQ and continually reviews this to expand the range of PME programmes funded.

Our PMEs also benefit from the Place and Train Programmes funded by WDA.

One such pilot programme that we fund, working with the Association of Small and Medium Enterprises (ASME), is the Max Talent programme which is open to all SMEs, regardless of industry or sector. Mr Teo Siong Seng will be glad to note that a total of 740 PMEs have been placed across 706 SMEs under the Max Talent programme, from its inception in April 2012 to 31 December 2013.

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Ms Foo Mee Har pointed out that some PMEs need help to gain overseas exposure. She spoke about the Asian Business Fellowship (ABF) programme which she had supported during her stint at Standard Chartered. I am pleased to inform Ms Foo that the ABF has evolved into a "Market Attachments" component under IE Singapore's Global Company Partnership (GCP) Programme. In fact, the Deputy Prime Minister announced in this year's Budget Speech that "Market Attachments" will be enhanced, expanding the scope of support for staff attachments in overseas markets.

For displaced PMEs, we will continue to help them get back into employment quickly. CaliberLink empowers our PMEs with greater ownership of their CET journeys by providing more platforms for self-mastery, exploration and enrichment. Since its launch in December 2011, CaliberLink has assisted more than 5,000 PMEs through its training and career consultation services, networking events and workshops. Of these, about 2,000 sought dedicated employment assistance in the form of career coaching services, and 750 have since found employment. Although CaliberLink is relatively new, these figures are encouraging. Our career consultants are critical to ensuring that workers receive personalised advice that best suits their needs and aspirations.

Take Mr Glenn Au, for example. Mr Au was 51 years old when he approached CaliberLink in May 2013 when his position as a Senior Specialist in Human Resource at an MNC was made redundant in a restructuring exercise. Apprehensive about the job market's negative perception towards older workers, Mr Au wanted to explore job opportunities in other sectors and other job functions. He also felt that his degree in Engineering may hinder his finding a job in HR.

The career coach from CaliberLink, Mr Mohamed Alfee, advised Mr Au that his previous work experience in HR was relevant and that he should continue applying for jobs in HR. Through Mr Alfee's guidance, Mr Au overcame his self-perceived "mature age" barrier to employment by continuing to apply for jobs in Human Resource, working closely with the coach to redraft his resume to highlight his transferrable skills, as well as HR and Training experience.

Through CaliberLink's support, I am glad to note that he finally secured a job as a senior Human Resource Manager in SMRT Corporation and enjoys a higher salary compared to his previous job. I am told that he now even shares his job search journey with other job seekers at workshops organised by CaliberLink. We will help displaced PMEs like Mr Au get back on their feet as quickly as possible, so that they can continue to support themselves and their families.

Mr Patrick Tay and Ms Mary Liew spoke about the need for multiple skillsets for our PMEs, with Mr Tay further suggesting a PME Capability Development Fund. Over the years, our approach to helping PMEs develop their skills has evolved with the changing needs of the economy.

In light of the rapidly changing environment, deep expertise in one area may no longer be sufficient, as Mr Tay had noted. PMEs may require different skills and competencies from what they have today, and we will help them acquire these necessary skills through CET.

As Mr Patrick Tay suggested, one way to do so is to help PMEs develop deep vertical expertise in two or even more areas, and strong transferable skills which are relevant across industries – moving from developing T-shaped to pi-shaped workers. We are, in principle, supportive of this idea. In our review of the CET Masterplan, we will also be looking at funding support for training these PMEs.

Mr Patrick Tay also raised his concern about graduates from private education institutions. As he pointed out, strong career aspirations have led to a greater demand for academic upgrading, especially for degrees. Adding on, Ms Mary Liew and Mr Tay both spoke about affordability.

While we will continue to create quality jobs for Singaporeans, we also need to ensure that our educational institutions produce graduates who are highly employable, with strong substantive knowledge and relevant skills. For the private education sector, the Government will continue to maintain standards through a holistic approach that integrates regulation and quality assurance, and consumer education.

Students also need to take greater ownership of their own careers, and be discerning in their choice of institutions and courses. Prospective students should do their homework to find out about the employment outcomes of graduates of the education provider. Cost should also factor into their calculation.

Education should never be a paper chase. Increasingly, employers are seeking to recruit employees with relevant competencies and skills, regardless of the qualifications they hold.

Allow me now to move on to Older Workers. Several Members, including Mr Heng Chee How, Mr Seng Han Thong, Mr David Ong, Mr Zainudin Nordin and Mr Gerald Giam have raised their concerns.

Our basic principle is this: we want to help Singaporeans who desire to work to be able to do so. We will continue to improve job opportunities for them and help them develop the necessary skills to access those opportunities.

At last year's COS, I announced the WorkPro programme to provide comprehensive support to encourage older workers and economically inactive locals to return to work, and to promote work-life harmony. I thank Mr Heng Chee How for his concern about its progress.

The take-up rate has been encouraging, with more than 700 companies coming on board as at December 2013, nine months after the programme was launched. Another aspect of WorkPro is aimed at promoting flexible work arrangements. Senior Parliamentary Secretary Hawazi will elaborate more on the Work-Life Grant in his speech.

We are doing more for our older workers. With increasing life expectancy, many Singaporeans are capable of and desire to continue to work till an older age. I fully agree with Mr Seng Han Thong that we should help them to do so. This allows them to remain meaningfully engaged, to continue to earn an income and to be better prepared for their retirement. Just as importantly, working also sustains a sense of dignity and self-worth. So, it is not just about working longer for retirement adequacy.

The employment rate of older residents aged 55 to 64 reached 65% in 2013, a target we attained two years ahead of time. Few countries have achieved these levels, so we will monitor the trends going forward and see if it is realistic to push for an even higher target. But we will not let up on the current momentum and we will continue to help those who want to work to do so.

Mr Seng Han Thong will be pleased to note that we have reconvened our Tripartite Committee on Employability of Older Workers. Our efforts to help older workers can be grouped into five broad thrusts. First, improving workplace practices and support; second, raising productivity and skills of older workers; third, shaping positive perceptions of older workers; fourth, enhancing employment facilitation; and fifth, improving retirement planning.

Through our outreach to companies, we recognise that different sectors, such as hotels, retail and F&B, have unique needs and constraints. As Mr Heng Chee How has pointed out, some businesses may not know how to go about re-designing their workplace processes to cater to their older workers. Hence, the Tricom will work with industry associations to build companies' capabilities in managing an ageing workforce and roll out relevant age management practices. We will also work with industry partners to develop a training curriculum and standards for age management consultants, who can then help businesses implement age-friendly programmes.

Mr Heng Chee How also asked for an update on our plans for re-employment. Since we implemented the re-employment legislation in 2012, progress has been smooth. Based on the preliminary findings from our latest survey, 99% of private sector local employees who turned 62 in the year ending June last year were offered re-employment, including 67% of retiring employees who were offered re-employment on existing contracts, with no change to their employment terms.

Mr David Ong raised a related issue of wage adjustments upon re-employment. I would like to re-iterate that any adjustments to the employment terms for re-employed employees should be based on reasonable factors, such as employee's productivity, duties and responsibilities, and the extent of seniority elements in the wage structure.

So far, statistics have been encouraging. Among those re-employed in the same job in the private sector, 96% did not experience a basic wage cut.

Overall, employers are keen to tap on older workers' skills, knowledge and experience. The positive results of re-employment have affirmed that this approach works for us. We considered various options, including extending the statutory minimum retirement age. But we have decided to adopt the re-employment approach as it allows workers to work longer, while ensuring that employers have sufficient flexibility to manage their manpower needs.

We are looking into further raising the re-employment age from 65 years old, possibly to 67. As the Retirement and Re-employment Act (RRA) has been in effect for only two years, the Tricom, in consultation with employers and unions, feels that we should allow time to monitor its impact. At the same time, the Tricom will review and iron out any outstanding implementation issues and update the law and the Tripartite Guidelines on the Re-employment of Older Employees. We will announce the proposals, including the appropriate time frame for raising the re-employment age, when these are ready.

We should also not rely only on legislation to support the employment of older workers. Mr David Ong rightly pointed out that addressing age discrimination is an on-going journey which requires a mindset change by all members of society – employers and employees, supervisors and so on. To that end, the Tricom will be launching an initiative to shape positive perceptions of older workers, to highlight the value they bring and to encourage companies to tap on their experience and skills.

Finally, I would like to cover the important topic of retirement adequacy for Singaporeans. The CPF contribution rate changes announced at Budget 2014 were made in close consultation with our tripartite partners. In deciding on the quantum and the pace of the increases, we were mindful of the need to strike a balance between providing for better retirement adequacy, and making sure that we do not raise wage costs to an extent where it affects the employability of our workers and our businesses lose their competitive edge.

I thank Mr David Ong for his concern about the adequacy of retirement and healthcare savings of older workers, and for his suggestion that employers could contribute even more to the retirement savings of their employees.

Raising employer CPF contribution rates further is one way to help provide better adequacy, but it will have an impact on business costs and thus employment opportunities. I think both sides of the issue were aired during the Budget Debate. Any further increases in our employer CPF contribution rates will have to be carefully considered by the tripartite partners and, if deemed necessary, done in a calibrated and gradual manner.

More importantly, we have to keep at our efforts to improve the employability of our older workers. The Government supports the employment of older workers heavily, especially older low-wage workers, through schemes like the Workfare Income Supplement (WIS) and the Special Employment Credit (SEC).

Mr Seng Han Thong spoke about the increase in the Minimum Sum (MS) and asked if the Government could conduct a review on the long-term MS policy. The MS aims to provide enough for the basic retirement needs of Singaporeans. What is basic? If you have the full MS in cash at 55 today, you should be able to cover the expenditure needs of a two-member retiree household in the second quintile, in other words, between the 20th percentile and 40th percentile of households.

We tried to keep the MS increases as gradual as possible to minimise the impact on each successive cohort. We have no plans to revise the MS further in real terms in the near future, after the MS target has been reached in 2015. However, in nominal terms, the MS will still have to be adjusted to account for inflation and ensure that the real value of the MS, in 2003 dollars, is preserved. I would like to assure Mr Seng that we will continue to review whether the MS is sufficient to support basic needs and will take his suggestions into consideration. Mr Seng had earlier said that "one size does not fit all, so one sum does not fit all". However, the fact is that this is a Minimum Sum, so it is one sum that is required by all.

Ms Jessica Tan asked if the age at which the Retirement Account (RA) is created to set aside the MS could be reviewed as Singaporeans work longer and retire later. There are several reasons why an RA is created and the MS amount set aside at age 55.

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First, it helps Members grow their savings more quickly in the final years prior to the draw down age, as the RA pays a higher rate of return than the Ordinary Account (OA).

Second, the setting aside of the MS is linked to several other schemes which also take place at age 55. For example, members are allowed to withdraw $5,000 or any savings in excess of the MS and Medisave Minimum Sum at age 55. The rest is transferred into the RA where the rules governing withdrawals are necessarily stricter to safeguard them for retirement needs.

We empathise with situations of lower income older Singaporeans who face difficulty paying the mortgages for a basic HDB flat. But rather than delay the creation of the RA at age 55, we take a targeted approach. We evaluate the financial situation of such appellants and, where warranted, we will allow them to use savings in their RA that originated from the OA for their housing needs.

Mr Seng suggested having a lower MS for lower income members so more members can have access to their CPF savings for housing or other withdrawals after the age of 55. More generally, several Members of the House have also previously petitioned for the CPF to be more flexible in allowing access to CPF savings. This echoes Dr Intan's call for flexibility in the repayment of CPF savings withdrawn for housing.

While I understand that many look forward to withdrawing their CPF monies when they turn 55, this is not the primary purpose of the CPF. The CPF is fundamentally for long-term retirement needs. With rising life expectancy and more members staying single, as Ms Jessica Tan had pointed out, we should. in fact, be looking at putting aside more savings. The CPF is our nest egg for retirement, and not a golden goose to be slain upon reaching 55. By and large, we must uphold the principle that the design of the CPF system should be tilted towards meeting longer term needs. Hence, restrictions are placed on the use of CPF savings for other purposes. This includes the use of CPF savings for housing. However, we do allow for flexibility today where the case merits.

In particular, Dr Intan asked if we can be more flexible in requiring the repayment of CPF savings, in the case where a member buys his own HDB flat and has to withdraw as a co-owner of his parents' flat. Under the CPF Act, any withdrawals of CPF savings for housing must be secured against a charge on the property and refunded to the member's CPF account when he gives up ownership of the property. This safeguards his CPF savings for future housing and retirement needs. In fact, we do not require the refund of CPF if the CPF member continues to retain ownership of the first property, for instance, if he buys a private property as a second property.

In the case of HDB flats, one family is allowed to own only one HDB flat at any one time, so that more families can access public housing. HDB requires a person to relinquish ownership of the first flat within six months upon taking possession of his new flat. This then triggers the refund of CPF taken to purchase the first flat. Today, CPF members who have difficulties repaying in a lump sum may opt to make progressive payments to bring down the total refund amount until the new flat is ready, which may be in two to three years' time. Alternatively, households can obtain a loan from HDB or the banks secured against the property, or make a transfer of CPF funds from the eligible accounts of other co-owners of the flat to effect the refund.

We empathise with the difficulties some families might face and are currently jointly reviewing with MND if further flexibility can be provided, without unduly compromising members' retirement needs.

On the issue of CPF nomination highlighted by Ms Lee Li Lian, when a CPF member passes away without making a nomination, his CPF monies will be distributed to his immediate family by the Public Trustee according to the intestacy laws. This safeguards the welfare of his immediate family members. The CPF Board's nomination scheme provides CPF members with an option to nominate other recipients of their CPF monies upon their demise and how much each nominee should receive. Our view is that it is best left to members to decide if they wish to make a nomination depending on their circumstances.

Once a nomination is made, the Board is legally bound to abide by the member's nomination, except upon marriage, when the nomination is actually nullified. In particular, in response to Ms Lee Li Lian's query, the treatment of CPF nominations is generally in line with the treatment of wills. Nominations are not nullified in the case of divorce as we consider that the member may still intend to provide for his ex-spouse and/or children.

Ms Lee Li Lian said that this causes confusion and she asked that more awareness be generated on this issue. We will take her point about generating awareness. But I would like to also note that it is stated in the first two lines in the general information section of the CPF nomination form, that a marriage will automatically revoke the existing nomination, and a divorce does not revoke an existing nomination. So, it is actually right here in the first two lines of the notes attached to the CPF nomination form. But I take her point that we will continue to do more to raise awareness. We provide comprehensive information on CPF Board's website and members can also call CPF Board's hotline or visit the service centres to find out more. In fact, we also advise CPF members when they wish to make a nomination to do it at our customer service centre where the customer service executives will clarify any questions they may have and also inform them about the implications of CPF nomination.

Allow me now to conclude. Through our CET and CPF system, and what we do to support the employment of PMEs and older workers, we aim to encourage and facilitate Singaporeans to take charge of their learning, employability and retirement needs. And we will actively intervene to provide additional assistance to segments of the population that require more help.

At the start of my speech, I quoted one of our OSC participants, who said, "Lifelong learning is about how you create value for yourself." Indeed, as a government, we want to empower all Singaporeans to create value for themselves throughout their lives.

This culture of constant and continuous improvement will help us be more responsive, relevant and resilient. It will enable us to weather future storms and seize the opportunities that come our way, to earn a better wage, in a better job, for a better life.

Accelerate Flexible Work Arrangements

Ms Foo Mee Har: Madam, I have spoken in Parliament many times on the subject of flexi work. Unfortunately, we have made very little progress on this front.

In an attempt to boost flexi work, MOM launched a new scheme last year, WorkPro. So far, this has resulted in approvals for fewer than 10 companies per month for the Work-Life Grant offered under the scheme, despite doubling the amount of funding available, as compared to the previous WoW! Fund scheme.

Flexi-work continues to be an unfulfilled hope for many Singaporeans. At the same time, businesses continue to miss the significant opportunities that flexible work offers to enhance their business performance and engage their employees.

Singapore can take learnings from UK on their flexi-work journey. The UK already has provisions in place that give employees with care-giving responsibilities the right to ask for flexi-work and have those requests considered seriously by their employers. About 96% of UK companies already offer some degree of "flexi-work".

But what is really interesting is last year, a group of 22 of Britain's most successful companies decided to take flexi-work to yet another level because they have experienced significant and tangible financial results that flexible working brought to their businesses.

They experienced benefits equivalent to savings of 3% to 13% of workforce costs and, in some instances, sales uplifts of 11% when implemented successfully by business leaders. This group of companies collectively hire half a million people across the UK, and their track record shows that flexi-work is not so much an employee welfare benefit as it is a strategic advantage for their businesses.

So, this group, who calls themselves the "Agile Future Forum" (AFF) pledged to share their experience and knowledge with other companies with the view to revolutionise traditional work practices and boost the UK economy. In fact, this group was formed in response to the UK Deputy Prime Minister's call to shake UK working practices up, to boost employment and workforce efficiency.

Madam, I hope MOM will critically review our experience on flexi-work and put in place a different and bolder strategy to accelerate the adoption of flexi-work in Singapore.

We must help companies dispel the myth that flexi-work is a luxury that employers can ill-afford in today's tight labour market. Instead, flexi-work should be our response to the modern economy, where workforce agility can generate significant economic benefits and be a means to attract and retain talent, and get the workforce engaged to boost the competitiveness of companies.

Work-life Balance

Ms Lee Li Lian: We have talked extensively about the need to institutionalise work-life balance at the workplace. While we have existing policies to encourage employers to implement flexible work, it seems that more needs to be done.

A recent global survey by Randstad this year revealed that only 20% of companies in Singapore intend to hire more people on flexible working arrangements. Fifty-five percent of employers admit that their organisations' efforts to create flexible work options are average or poor. The main reason for this is, business leaders are not convinced that this will be beneficial to their organisations, particularly in terms of employee productivity. There are countless studies, including one by MOM, that debunk this myth and prove, in fact, that flexible work practices can boost productivity. By creating a better work culture that engages and addresses employees' needs, companies can retain talent and improve productivity. Flexible work does not just improve employee morale, but ensures that employees are set up to work remotely which reduces service gaps and business continuity.

The Deputy Prime Minister had outlined the ICT for Productivity and Growth (IPG) programme to accelerate the adoption of ICT solutions. This encourages the adoption of ICT to address productivity concerns. The Government has committed to channelling companies towards more flexible working arrangements to support families in Singapore. As such, it is important that the Government leads the way in shifting mindsets that flexible work arrangements hamper productivity. Solutions that can drive productivity and enable flexible working should be promoted. Further reward should be offered to those who can implement flexible work policies successfully upon adoption of that technology. There is no better time than now for companies to make these ICT investments to enable flexi-work, and for the Government to steer them in this direction through a number of existing measures such as this.

Flexible Work Arrangements and WorkPro

Ms Mary Liew: Madam, it is really encouraging to hear from the Senior Minister of State that the WorkPro is making some progress. However, more can be done. As I have already covered quite a few points during my main Budget speech, I will not repeat them here.

I would like to touch on the Work-Life Grant Component which is a step in the right direction to help workers to have a more balanced work life. Here are some of the areas of concern to be improved, so that both employers and employees can benefit from this programme.

Firstly, under the Developmental Grant for Workplace Improvement and Job-Redesign, there is a one-time grant of up to $40,000 to defray the cost of implementing work-life strategies. However, the guidelines are currently rigid, according to the feedback given by companies, and that companies need to introduce two new FWAs. Enhancements to existing FWAs are only considered where presented on a case-to-case basis. Would the Minister consider recognising all forms of enhancement by reviewing the guidelines and to offer additional grants?

This grant also co-funds up to 30% of the expenditure on IT infrastructure but capped at $10,000. For companies with genuine IT needs who allow their employees to work from home, $10,000 may not be enough to set up or upgrade servers to allow remote access for work. Will the Minister consider funding a certain percentage of the IT system, or can the cap be raised?

Madam, mothers who return to the workforce after maternity leave are sometimes faced with the problem of proper facilities at their workplace. I would like to call upon the Minister to extend funding of lactation facilities to building owners, so that employees of tenants can benefit as building in economies of scale is a cost-efficient solution that will benefit many workers.

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Secondly, it is difficult for companies to meet the minimum 30% utilisation rate, required to enjoy FWA's incentives, especially for companies with a large workforce. Would the Minister consider recognising companies who have made efforts in providing incremental FWA utilisation rather than having them meet a certain specified percentage? For example, if a company with a workforce of 1,000 employees decides to offer FWAs to 100 of their staff, they would not be able to benefit as they did not meet the minimum 30% utilisation rate. However, 100 employees on board FWA is still a significant effort and we should be supporting companies for such initiatives.

In terms of administration, onerous tracking needs to be done as companies have to keep records of each employee's utilisation of FWAs for at least six months, before they are eligible to submit their claims. For big companies, this is a tedious process if there are a lot of employees. For SMEs, it can only pose a problem as they may not have automated IT systems to capture all the data and so it has to be done manually. Can the Minister look into easing this administration process to make it more friendly?

Moving ahead, the current WorkPro scheme should serve only as a guideline and companies should be allowed the flexibility to introduce their own policies and processes to meet their needs and still benefit from the grant. There is no "one size fits all" solution as every company's situation is different. Therefore, I would like to urge all parties to consider having a grant which is more outcome-based.

Companies recognised for their efforts in FWAs could even be certified, similar to the People Developer certification, given to organisations which excel in people development. This certification will further help workers identify companies who offer FWAs and can even be a form of recruitment and retention tool when jobseekers apply for jobs. This is especially important when we want more women to return to the workforce.

Mdm Chair, we may not have reached the FWA standards of many developed countries, but I am confident that with further improvements and with the Government and its Ministries' support, more companies will adopt FWAs in their workplace.

Senior-care Leave

Assoc Prof Fatimah Lateef (Marine Parade): Madam, our population is ageing rapidly. Our family size is getting smaller. We encourage our seniors to be cared for within their homes and the community. We also want families and extended families to look after their seniors. Our seniors have various needs to be tended to. Many need to be sent and fetched to and from their medical check-up and appointments, and others need to be sent to rehabilitation facilities. When these seniors sustain any emergencies and crises, it may throw the family members and caregivers' schedules off balance, especially if they are working.

Thus, the call for formal recognition and legislation of senior-care leave, preferably by both the public and private sector employers. Legislating this will send a strong signal to employers on pro-family practices. A suggested period of up to one week annually per worker would be a good number to start off with. The senior-care leave will send a strong signal that we especially place a strong emphasis in our Asian Society which is a strong proponent of filial piety and positive family values.

Eldercare Leave

Ms Ellen Lee (Sembawang): Madam, the PAP Women's Wing presented its Position Paper at its annual Conference in February 2014 on "Seniors in Singapore". Of great concern to the Women's Wing activists is the growing number of sandwiched Singaporeans who feel overwhelmed trying to balance their career aspirations and their sense of duty towards aged parents who require assistance, both physical and financial, to go for health screenings, regular follow-ups and attend to other health-related matters. Given the need to wait for hours at polyclinics and hospitals, the stress that they feel is aggravated by employers and co-workers who are not always pro-senior in their attitudes.

To support Singaporeans who want to play an active part in taking care of their aged parents or relatives and to uphold respect for our elders and filial piety, would MOM agree to mandate paid eldercare leave in the same way that childcare leave for young children is mandated?

Parent-care Leave

Ms Lee Li Lian: Singapore's rapidly ageing population requires a holistic approach to the many challenges involved. As our parents and grandparents age, they will require not only medical attention, but also regular care and support from their children who may be working adults. These working adults may need to leave work from time to time to care for the elderly. As it stands, it is not mandatory for employers in the private sector to provide for parent-care leave.

The Civil Service introduced parent leave in late 2011 whereby civil servants are entitled to two days of eldercare leave, without the need to show medical certificate. This is a good start but two days are not enough.

According to an MOM survey in 2010, only 10.6% of private companies offered parent care leave to their employees. Furthermore, the survey noted that only large companies with 200 or more employees did so. This is, again, plainly insufficient.

Calls for mandatory parental leave have also been heard in this House. On 12 November 2013, at the Second Reading of the Employment, Parental Leave and Other Measures Bill, Members of the House asked the Government to consider making eldercare leave mandatory across the board.

In response, Acting Minister Tan Chuan-Jin said that while he encouraged support for elderly parents, the Ministry was "mindful that we should allow businesses to adjust and we do not have plans to legislate any family leave schemes at this present stage."

Making such leave mandatory is reasonable since many of our elderly parents visit the hospitals or clinics very often for check-ups. Hence, I would like to urge the Ministry to make it mandatory for all private companies to offer Singaporean employees parent-care leave. In order to prevent abuse, supporting materials, such as hospital receipts and letters from doctors or physiotherapists, may be submitted to employers.

Marriage and Parenthood Package

Ms Mary Liew: Madam, the enhanced Marriage and Parenthood Package aims to help working couples balance work and family commitments. It encourages shared parental responsibility, with fathers playing a more active role in raising children. A recent NTUC U Family Happiness Poll showed that only 50% of the respondents agreed that their companies have been implementing more family-friendly workplace measures in the last two years. Can we take further steps to ensure this percentage increases significantly in another two years' time?

The poll also shows the difference in attitudes of working mothers and fathers. For example, working mothers prefer access to flexible work arrangements, family-friendly workplace culture and access to family leave scheme, while working dads prefer workplaces with career progression, family-friendly workplace culture and job security. Moving forward, the differences must be taken into account.

Businesses should be encouraged to provide holistic support for working caregivers with elderly and special needs dependants. This means providing a four-tiered framework that consists of: firstly, provision for flexible work arrangements; secondly, access to family care leave; thirdly, provision for family support schemes and/or facilities; and fourthly, non-discrimination of career progression for working caregivers.

Can the tripartite partners come to an agreement on how we can take a concerted effort to ensure and help working caregivers to stay in and/or return to employment?

Lastly, can the Government and trade associations play a role in issuing family-friendly policies for their members so that family-friendly workplaces become pervasive?

Screening Foreign Domestic Workers

Mrs Lina Chiam: Mdm Chair, it was reported that there were 30 cases of attacks, manslaughter and murder involving foreign domestic workers. Two new cases were reported this year, one in January 2014 and the other one just three days ago. During the trials, they were said to have been mentally unstable, have low IQ and incapable of rational thought. Many of these cases are preventable, if employers could be given pre-warning and even to the extent of not employing domestic workers with tendencies of abnormal behaviour.

Recently, The Straits Times reported that the Indonesian Embassy is in an ongoing discussion with their government to introduce basic psychological tests for new domestic workers coming to Singapore after the recent high-profile murder cases involving Indonesian domestic workers. It is important to have psychology tests for domestic workers as they spend long hours as caregivers of vulnerable members of the family, the young and the elderly, including babies which require them to have extreme patience and rationality.

Madam, this issue was addressed in Parliament previously. I would again like to ask whether the Government is willing to make compulsory some form of mandatory psychology tests for new domestic workers as part of the work permit application. This is to ensure the new maid does not have unnecessary violence and homicidal tendencies that may turn out disastrous for the family. The test will also give peace of mind to the family and the maid as a whole. Would the Government also consider subsidising part of this cost of the test from the domestic worker levy collected from employers?

Workplace Safety and Health

Mr Yeo Guat Kwang: Mdm Chair, in light of the recent increase in the number of worksite related incidents, I would like to repeat my earlier message to our tripartite partners that behind every worker is a family waiting for them to return home sound and safe at the end of every work day.

To achieve the WSH 2018 vision of an accident-free workplace for Singapore, MOM must send a stronger and clearer signal to employers that workplace safety must never be compromised. What are MOM's plans to influence a breakthrough in the WSH outcome and performance in our workplaces?

I would like MOM to also review the WSH Act and put in place a stronger deterrent framework that empowers MOM to enforce stronger proactive prevention and remedial actions on recalcitrant employers who had actually wilfully and blatantly breached work safety guidelines. At the same time, MOM must continue to strengthen the working relationship with employers by rolling out structured initiatives and programmes to help them be WSH-ready. For SMEs particularly, there is a need to provide them with the "how" and the "what" of the WSH system that they could actually be able to adapt very easily to be WSH-ready and identify the risks at all workplaces.

Madam, one way to define whether workplaces are WSH-ready is to determine whether they have carried out appropriate WSH Risk Assessment and at the same time find recommendations on how to close all these "gaps".

For sectors which were "low WSH awareness, relatively higher risks" like hospitality, transport and logistics, education, and cleaning industry, we hope that the Ministry could provide more support and resources, and work with tripartite partners to customise WSH programmes that are targeted at all these areas to also address the issue of the risks identified.

MOM can also support the labour movement in its Union Safety Agenda for Everyone at Work (U-SAFE) initiatives by providing WSH expertise in its industrial cluster effort. For example, the aerospace and aviation cluster work group involving the management and union members has already come up with a plan to see how they can address the issues of lightning. Together, the group has managed to identify some areas of concern and at the same time come up with practical solutions and recommendations and make the workplace significantly safer.

I urge MOM to provide more resources and support to such sectoral initiatives at the workplaces. Besides providing expertise, MOM can also help develop guidelines for WSH risks identified.

Since workers and, by extension, their family, stand to lose the most when safety lapses occur, MOM must also safeguard workers' well-being by providing them a secure channel to report such lapses. I request MOM to strengthen such a channel to have sufficient protection for workers so that they can report lapses without any fear.

Lastly, on top of the current mandatory safety orientation courses for workers, I hope that MOM could do more to help the large number of migrant workers, who come with different work practices and culture, to equip them with work safety knowledge so that they can also proactively and productively help us in identifying lapses of safety at their workplace and work safely with their local co-workers.

The Chairman: Mr Heng Chee How, you have two cuts. Please take them together.

Workplace Health Initiatives

Mr Heng Chee How: Madam, it is widely accepted that the health of a person affects his morale and ability to perform at work, regardless of age. At the same time, it is also true that Singaporean workers spend a large chunk of our waking hours at work. This means that the health of a worker affects and is affected by the workplace.

The importance of workplace safety and health, therefore, cannot be over-emphasised as they will materially affect the employment and employability of workers for better or for worse.

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This is even more so with an ageing local workforce and the need to help workers extend their effective working years and for companies to be able to continue to tap on these workers' experience and value.

One key aspect is to minimise the loss of employability due to substandard workplace health and safety conditions, and to promote positive impact on health through workplace initiatives. In addition to general workplace health promotion, there is also scope for focused health initiatives in specific occupations with a concentration of older workers, for example, in cleaning, taxi-driving, parts of retail, in security and parts of manufacturing. Prolonged standing, sitting, lifting and repeated use of certain joints are typical aspects of work that erode the health and employability of workers, if not consciously counteracted by both workers and their companies.

I would like to ask MOM to update on how it is working with MOH and HPB to integrate and better target workplace health programmes to the older worker population in general and at occupations with a concentration of older workers in particular.

Progressive Employment Practices

My second cut is on progressive employment practices. The Tripartite Alliance for Fair Employment Practice (TAFEP) was set up to promote fair employment practices and to help echo discrimination at the workplace. This work is important both to register the tripartite resolve to maintain fairness in the labour scene, as well as to investigate into reported cases of discriminatory practices vis-a-vis national laws and guidelines.

I believe that we can do even better. For example, besides urging companies to stay on the right track of fairness, can TAFEP play a more proactive role in enabling companies to better manage and unleash the full potential of a more diverse workforce that comprises employees of an increasingly wide spread of ages, experiences, qualifications, nationalities and expectations?

I say this because I believe that this is key to our national drive to transform our economy and productivity performance. Progressive employment practices are no longer "nice to have" items on this journey of ethical management, innovation and competitiveness. Technology, technical skills and equipment aside, the critical ingredient in separating winners from the others is how they galvanise the human spirit towards unity and excellence. Doing so is easy to say but it is very hard to achieve.

I, therefore, would like to ask for MOM's plans to enhance the work of TAFEP to include the promotion of progressive employment practices and, thereby, make a more direct contribution towards national economic and social transformation.

Strengthening Tripartite Alliance for Fair Employment Practices

Mr Zaqy Mohamad: Mdm Chair, my dialogues with residents and workers often revealed concerns about job opportunities, whether there is any discrimination either by age, race or nationality. The top complaint received by TAFEP – about half in a report last year – is about employers favouring foreigners over Singaporeans. At the same time, a report by an independent Malay/Muslim panel, the Suara Musyawarah, several months ago also highlighted concerns about discriminatory practices at workplaces, with the perception that some employers prefer non-Malay employees.

We all agree that we need a vibrant business environment for Singapore's economy to prosper. Thus, we should continue to welcome employers from diverse environments and business practices, globally and locally. At the same time, we need to give employees here in Singapore the assurance that their rights as workers are protected, and while discrimination at the workplace is often hard to prove, it is all the more important to do our utmost to prevent discriminatory employment practices.

It is timely for the Ministry to put workers' rights higher on the fair employment agenda and I suggest this: by making TAFEP a full Statutory Board or a regulatory agency to govern fair employment and work practices in Singapore and enforce compliance against discrimination or unfair practices. I think TAFEP needs to be given more "bite" to be effective. Today, many see TAFEP as a lightweight organisation working within the framework of SNEF funded by the Ministry and moral persuasion is how TAFEP engages employers today, which some may find ineffective.

Thus, in addition, I would also urge MOM to consider introducing an Act focusing on Fair Employment covering anti-discrimination and harassment laws at the workplace. We have some other laws that are often leveraged. But as a mature economy, it may be time to give Fair Employment a stronger backing, particularly against employment discrimination. This will give TAFEP and workers greater security and assurance that we have a stronger legal backing to address employment and workplace discrimination.

I personally do not think this will dampen our vibrant employer and business landscape here as many major economies around the world already have such laws in place. I also believe most employers will also have fair employment at the core of their HR values and practices. In fact, this may also give them greater certainty and transparency of our employment framework here.

Progressive Employment Practice

Mr Zainudin Nordin: Madam, allow me to touch on the topic of growing expectations and standards. Our increasingly educated labour force would desire a progressive and higher standard of employment and human resource practice. The employees of these days are no longer like those of the past who keep quiet and listen obediently. The youth and workers these days are more educated, ambitious, daring, outspoken, and a clash of ideas between generations and hierarchy can result in conflicts and requires mediation. Often, strong emotions and negative attitudes can lead to unfair practices and, worse, dismissal and loss of jobs.

The tripartite efforts through TAFEP have been very effective in preventing some of the most common and standard forms of workplace unfairness. As situations become more complex, I believe we need to strengthen these efforts. Can TAFEP be further improved to manage more complex problems and grievances? May I also suggest that TAFEP enhance the outreach to other workers and less educated workers who have little knowledge about their rights? They are often the ones whom I would classify as vulnerable workers who are victims of unscrupulous employers and bad HR practices at the workplace because they do not know how and where to voice their grievances.

Madam, public communication and information about the support and relevant services by TAFEP to assist are apparently not getting to them and may be even inadequate. Some may miss the television ads or, perhaps, most may not even understand those advertisements. TAFEP can consider working with the grassroots organisations and relevant NGOs to spread the message to the elderly and less-educated workers and increase awareness of workers' rights.

The Chairman: Senior Parliamentary Secretary Hawazi.

The Senior Parliamentary Secretary to the Acting Minister for Manpower (Mr Hawazi Daipi): Mdm Chair, may I have your permission to display some slides on the screen during my speech?

The Chairman: Yes, please.

Mr Hawazi Daipi: Mdm Chair, I would, first, like to thank Members for their suggestions and comments. Making our workplaces better is an important part of MOM's goal of better jobs for Singaporeans. What is a good workplace? Members covered many of the key aspects of the concept of a good workplace in their speeches. At the basic level, it is one where workers are treated fairly, accorded their due protection under the law, and is safe. But a good workplace goes beyond that. I will speak on measures that MOM is undertaking to assure Singaporeans of better, more progressive workplaces. Before that, though, allow me to speak a little more on MOM's targeted initiatives to help the more vulnerable segments of our workforce. Dr Amy Khor spoke on older workers. I will now touch on measures we are undertaking to help low-income Singaporeans benefit from economic growth.

Mr Christopher de Souza highlighted the concerns of our low-wage workers. As Acting Minister for Manpower mentioned, supporting our low-wage workers continues to be a priority for MOM. We take a three-tiered approach. The first tier is about creating good jobs and growing the economic pie. The best way to help low-wage workers is to keep the labour market tight and unemployment down. Low-wage workers tend to be more severely affected when the economy takes a turn for the worse. Hence, maintaining a competitive and vibrant economy is in every Singaporean's interest, especially our low-wage workers. Having wage interventions, including a minimum wage, in the face of high unemployment is hollow. But creating good jobs and having a vibrant economy are not enough. Because in a globalised world, the income gap widens as the talented with knowledge and skills are much sought after; and the lower-skilled workers find themselves competing with the millions of lower-educated workers in other developing economies. So, we need a second tier of broad-based interventions targeted at our workers to supplement their income, encourage regular work and invest in their training so that they remain employable and productive. Workfare is key to this.

We developed the Workfare Income Supplement (WIS) scheme to incentivise work by boosting the income and retirement savings of low-wage workers who are making an effort to support themselves and their families. Last year, we enhanced the WIS quantum and expanded the coverage of the scheme. We expect over 400,000 Singaporeans to benefit from WIS for work done in 2013 and they will receive over $600 million in WIS payouts. The Workfare Training Support (WTS) scheme, which we enhanced last year, provides generous subsidies for workers to up-skill. To date, WTS has raised the incidence of training by more than a third.

Let me cite an example. Sixty-four-year-old Mr Abdul Latiff Bin Abdul Wahab's experience shows how training can benefit the workers. There you have on the screen Mr Abdul Latiff looking younger than his 64 years old. Previously equipped with a Signalman certification and working as a stevedore, Mr Abdul Latiff tapped on WTS' enhanced funding and training allowance for self-sponsored trainees to attend a Riggers course at WDA's Career Centre via Central Singapore CDC. With a Rigger certificate, Mr Abdul Latiff was then able to undertake a Rigger's job, earning an average monthly salary of $2,000, about a third more than his previous salary. I am happy to hear that proactive learning and career advancement do not stop with age, and strongly urge more workers and employers to tap on WTS.

As Senior Minister of State Amy Khor has mentioned, we are also in the midst of a major review of our CET Masterplan to make our CET system more relevant to our workers and businesses, and to strengthen the link between training and skills utilisation at the workplace.

At the enterprise level, we must ensure businesses are well-positioned to leverage on their workers' training to achieve productivity gains. Mr de Souza mentioned the Inclusive Growth Programme (IGP) which supports companies' productivity improvement projects. Under the IGP, the resulting gains from increased productivity are shared with workers through wage increases. About 34,000 local workers have benefited from IGP projects to date. For more than half of these workers, wages have gone up by at least 10% as a result of productivity improvements.

Such broad-based interventions at the second tier help lift the prospects for low-skilled workers who are struggling to compete in a globalised world. However, we also recognise that there are specific sectors that may need more help because they suffer from particular market failures, for example, where there is a high prevalence of cheap-sourcing. Therefore, our third-tier help consists of targeted interventions to support wages at the very low end through regulatory enforcement of the Progressive Wage Model (PWM) concept developed by NTUC.

We have started to do this in the cleaning sector. Parliament has just passed a Bill by MEWR to introduce a new licensing regime for cleaning companies under the Environment and Public Health Act. Cleaning companies have up to September this year to ensure that for all new cleaning contracts, they pay their resident cleaners basic wages in line with the progressive wage levels recommended by the Tripartite Cluster for Cleaners, or risk incurring penalties, including having their licences revoked. By September 2015, the PWM requirement will apply to all existing contracts as well. We will work closely with our tripartite partners to provide greater clarity to the industry on how to ensure compliance with the PWM.

Last year, we announced the formation of a Security Tripartite Cluster (STC) to develop a PWM for the security sector. The STC is currently negotiating the terms of the PWM and, when ready, the Government will apply the PWM requirement to the licensing regime that is in place for the security sector. One of the key issues the STC is deliberating on is how to also address the issue of the industry's reliance on very long overtime hours, in order to improve the working conditions of security officers.

This is an important aspect of the tripartite discussions because wages alone will not ensure that employers will be able to better attract and retain manpower to address manpower shortages in the sector.

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Beyond the cleaning and security sectors, the landscape sector is the third sector where cheap-sourcing is prevalent. Basic wages for resident workers are not as low as they are in the cleaning and security sectors but they have stagnated at around $1,000 for several years.

Concurrently, we have seen little improvement in the number of local workers in the sector even though the number of jobs available has been on the rise. We will take steps to improve the wages and employment conditions of landscape workers. Like the cleaning and security sectors, we will set up a Tripartite Cluster for the Landscape Industry to study the need for mandating a Progressive Wage Model for the sector. MOM and NParks will work with the tripartite cluster to assess whether and how best to do so.

In total, we expect the third tier of targeted interventions in wages in the three sectors – cleaning, security and landscape – to impact more than 80,000 local low-wage workers.

Ms Mary Liew asked about extending the Progressive Wage Model concept to PME jobs. NTUC has been working with employers to develop progressive wage structures and career progression pathways in sectors, such as the hospitality and consumer business cluster. This covers not just rank-and-file workers but PMEs in these sectors as well. Mr Patrick Tay spoke about this during the Budget Debate. This is a good initiative to improve the skills and productivity of workers, thereby enabling them to command higher wages over time. It should continue to be done through negotiations between employers and unions. But I would like to stress here that beyond cleaning, security and landscaping, there is no plan to legislate the PWM in other sectors.

As I have mentioned, mandating the PWM through Government regulations is a very targeted intervention to support rank-and-file workers in sectors which suffer from cheap-sourcing. It is not appropriate for the Government to do this for all sectors and for all occupations. For most occupations, we should allow the market to determine the sustainable trajectory for wages, taking into account productivity changes over time.

I must also emphasise that the Government has not shifted from its fundamental position that raising incomes has to be based, first and foremost, on productivity improvements, to be sustainable in the long run.

A complement to our efforts to support workers is to encourage good employment practices. Good employment conditions are essential elements of a good job and can help encourage regular work. We have continued to raise standards through the Employment Act. We have also increased the penalties under the CPF Act against employers who do not make CPF contributions for their employees.

In 2012, we introduced the WorkRight initiative to step up compliance with the CPF Act and the Employment Act and increase awareness amongst low-wage workers of their basic statutory employment benefits.

Since WorkRight inspections started in November 2012, about 30,000 Singaporeans have benefited. More than half of these were low-wage workers. One example is Mr Lim Kim Siong, who was a lorry driver employed by a construction company. He was owed salary for working overtime and on public holidays, and for unutilised annual leave. Through "WorkRight", Mr Lim was able to recover his outstanding salary, amounting to $4,000, within a month of coming forward to MOM for help.

Madam, let me now turn to another important area in our push towards better workplaces, that is, safety and health. The Acting Minister spoke about the number of workplace fatalities in 2013 and the state of safety in the construction sector.

The top cause of construction site accidents, including the recent ones, continues to be "Falls from Height". We have been making concerted efforts in the last two years and we have seen notable progress and improvement since then. On the one hand, we have seen an increase in the number of fatalities and accidents, but on the other hand, in particular, for "Work at Height", we have seen improvements over the years. The number of "Work at Height" fatalities has fallen by more than 35% from 27 fatalities in 2009 to 17 in 2013. We will press on with efforts of the National Work-At-Height taskforce.

Mr Yeo Guat Kwang asked if MOM would put in place a stronger enforcement framework for recalcitrant employers. My Ministry plans to step up our enforcement actions against recalcitrant employers and individuals. We will press for stronger penalties, with higher fines and custodial sentences, for serious breaches of the law. We will tighten enforcement tools, such as the Stop Work Order and Business under Surveillance (BUS) programme. For example, companies will have to resolve safety lapses and conduct compulsory refresher training in the key problem areas before the Stop Work Order imposed on them can be lifted.

Regulation and enforcement are, however, only one side of the equation to bring about a safer workplace at construction sites. Ensuring that our workforce, both local and foreign, keep up with the changes in technology and equipment needed to increase productivity – through up-skilling and re-training – is equally important. Employers have to ensure that all their workers, including their foreign workers, are adequately trained.

Mr Yeo Guat Kwang also asked about MOM's plans to influence a breakthrough in workplace safety and health outcomes. We have taken stock of our WSH2018 Roadmap. In the remaining five years of the blueprint, we will intensify our efforts in four areas.

First, MOM and the WSH Council will ramp up efforts to strengthen the capabilities of WSH professionals and approved training providers, both in terms of quantity and quality. This is important as WSH professionals are our key enablers on the ground. We will broaden the ambit of the WSH profession by developing programmes and competency roadmaps for WSH professionals in a variety of fields, from occupational hygienists to workplace health professionals. This will help build up a pool of competent WSH professionals who can assist employers to identify, anticipate and manage not just workplace safety risks but also health risks.

Second, we will enhance the current risk management framework, which is the cornerstone of our WSH framework. The enhanced Risk Management Framework, or RM 2.0 in short, will include considerations of personal risk factors and not just workplace safety measures. In terms of on-site implementation checks, it will focus on practices rather than the documentation of the system and processes. RM 2.0 will also place greater emphasis on upstream risk control measures instead of downstream risk mitigation controls.

Several companies, in construction, for example, have already been doing this through the Design for Safety process. One such company is City Developments Limited, which works closely with its designers, builders and other stakeholders to reduce risks at source through design. For its Tree House residential development, the project team, including the landscape consultants, achieved the signature design of a 24-storey vertical green wall, while at the same time mitigating work-at-height risks. It did this by designing in access platforms and making careful plant choices for safe and sustainable maintenance.

Third, over the next five years, my Ministry and the WSH Council will collaborate with MOH and the Health Promotion Board (HPB) to integrate workplace safety and health and well-being for all employees, including older workers. This is an area that Mr Heng Chee How spoke about. An integrated approach is needed because poor safety can impact the health and well-being of workers. Conversely, ill health can also impact safety.

We call this holistic approach Total Workplace Safety and Health, in short, Total WSH. It means that while at work, the employee's safety, occupational health and well-being are holistically managed through comprehensive risk reduction by their employers. WSH Council will work with HPB and industry partners to develop practical assistance tools for companies on Total WSH. Outreach initiatives will begin in certain industries, including those with older workers. We will give more details later this year.

The fourth area we will focus on is bringing about a paradigm shift in mindsets, which must happen if we are to raise our WSH standards to the next level. The WSH Council will lead this effort to nurture a WSH culture and a "Vision Zero mindset". What is "Vision Zero"? It is a safety culture and a mindset that "all work injuries and ill health are preventable". The concept of Vision Zero is not new. Companies which have adopted and applied its principles have been able to achieve and sustain good safety records.

One such company is Jacobs. It is one of the world's largest and most diverse providers of technical, professional and construction services, with revenue of nearly $12 billion in 2013. Its goal is to take safety to BeyondZero® by preventing even one accident from happening, and putting the personal health and safety of their employees first – wherever they are. In 2012, Jacobs successfully achieved over 82 million of safe hours worked. Its BeyondZero® programme has helped the company to win industry-wide admiration and many accolades, in Singapore and its global operations. We hope to inspire more companies to adopt this Vision Zero mindset and translate it into concrete actions to reduce work injuries and ill health.

As my Ministry charts the way forward for the next phase of our WSH journey, we will continue to provide support and assistance to deserving companies, especially SMEs. We have programmes to provide cost support to SMEs and enable them to build up WSH capabilities. These include the WSH Assist and CultureSAFE programmes, and Safety Compliance Assistance Visits. Over the years, the WSH Council has also built up an online library of resources with videos, guidelines and checklists that are customised to the different industries, including hospitality, logistics and transport.

Finally, I would like to assure Mr Yeo Guat Kwang that my Ministry will work with NTUC on its U-SAFE initiatives to get the unions WSH-ready. We will share best practices, provide expertise where necessary or resources where appropriate.

Next, let me address the issue of mandating psychological health tests for new foreign domestic workers (FDWs) raised by Mrs Lina Chiam. A medical examination framework for FDWs, which includes six-monthly medical examinations, is already in place. It exists mainly to: screen for infectious diseases that are of public health concern, and, give a broad indication of the FDW's general fitness for work, including her mental state at the point of examination. It is impractical to mandate a wide-ranging set of medical tests for all employers. Individual employers with specific concerns should send their FDWs for other suitable medical tests.

Let us come back to the issue of building better workplaces. Mr Hri Kumar asked if MOM will enact laws to prevent discriminatory workplace practices. This is a point that was also raised by Mr Zaqy Mohamad. The fundamental issue we are trying to address here is mindsets and attitudes. To deal with this today, we rely on TAFEP, the Tripartite Alliance for Fair Employment Practices. TAFEP was set up in 2006 to promote fair employment practices – to educate and persuade employers to recruit employees based on merit, treat them fairly, and reward them based on ability, performance, contributions and experience.

An anti-discrimination legislation is one possible way to address workplace discrimination. We do not reject the idea entirely. But having legislation is not a silver bullet that will solve all discrimination problems. It could address the form but not necessarily the underlying substance of discrimination – that is, mindsets and attitudes.

The experiences of other countries with legislation have shown that it remains difficult for victims to prove discrimination and that they have suffered as a result. Legislation might also introduce labour market rigidity due to protracted disputes between employers and employees. These are complex issues that we need to address before we consider enacting legislation.

3.45 pm

For now, we will continue with the promotional approach through TAFEP. To bring about change in mindsets and persuade companies to implement fair and merit-based employment practices, Mr Hri Kumar suggested a Labour Tribunal for resolving employment disputes quickly and at low cost. As Acting Minister Tan mentioned in his earlier speech, MOM is exploring an expeditious and affordable avenue for dispute resolution related to breaches of individual contract of employment. TAFEP's example has shown that promotion and education is an effective tool in influencing change in the workplace.

The number of employers who have committed to implementing fair employment practices has risen steadily over the years, from only around 200 pledge signers in 2006 to over 2,600 last year.

Mr Heng Chee How, Mr Zainudin Nordin and Mr Zaqy Mohamad asked whether MOM has plans to enhance TAFEP's work. We do. The tripartite partners have agreed that it is timely to build upon TAFEP's progress and expand its mandate beyond fair employment to include progressive employment practices. Using TAFEP's model of education and promotion, we will pay more attention to progressive workplace practices such as work-life harmony and age management.

We believe that good and more progressive workplace practices will not only mean better jobs and quality of life for Singaporeans, but also help companies attract and retain more local employees, which is important amidst foreign manpower tightening.

Some companies, especially SMEs, may face challenges in adopting more progressive employment practices even if they are aware of its benefits and want to. To help such companies, TAFEP will operate as a one-stop centre to promote the adoption of fair and progressive employment practices, and raise employers' awareness of their statutory obligations. As Mr Zainudin Nordin pointed out, it is important that employees know their employment rights. MOM's WorkRight campaign is precisely aimed at educating employees in this area, and we will continue with our efforts on this front.

Singaporeans, including older citizens and disabled persons, are still concerned about discriminatory employment practices. Mr Zaqy Mohamad and Mr Hri Kumar also highlighted perceptions of racial discrimination at workplaces. The expanded TAFEP will therefore retain its original purpose of promoting fair employment practices, even as it takes on this expanded role. TAFEP will progressively scale up its operations to cover progressive employment practices over the next 12 months.

Madam, let me now speak more on a particular progressive employment practice – flexible work arrangements. Singaporeans have increasingly indicated a stronger desire to have a more fulfilling pace of life; more space to pursue other goals and priorities outside of work. Many have called for greater support for flexible work arrangements and more pro-family practices.

We are seeing more Singapore firms offer their employees flexible work arrangements. In 2012, 41% of firms offered their employees at least one form of flexible work arrangements. In 2007, this figure was only 25%.

We will continue to encourage employers to adopt more work-life friendly arrangements. The Work-Life Grant, under WorkPro, was set up in April 2013 precisely to encourage the adoption of flexible work arrangements by firms. Each qualifying firm can receive up to $160,000 over three years when they introduce new flexible work arrangements and encourage utilisation amongst their employees. I think it is something that may interest Ms Lee Li Lian and Ms Mary Liew. Ms Lee suggested that the Government encourage investments in Infocomm Technology (ICT) to facilitate flexible or remote working. In fact, firms can already tap on this funding to support ICT investments that enable employees to work more flexibly.

We have been closely monitoring the response since the grant was set up less than a year ago. As of December 2013, 84 companies and over 8,000 employees in these organisations have benefited from the Work-Life Grant. We have also started to review how we can further improve the grant, and are in the process of seeking tripartite partners' feedback. I would like to thank Ms Mary Liew for her various suggestions to enhance the Work-Life Grant, which MOM will carefully consider as part of our on-going review. We expect to complete the review and implement the enhancements by mid-2014.

Besides funding, we have also received feedback that it would be useful to provide guidance to employers on implementing flexible work arrangements as well as to employees on utilising them.

The Tripartite Committee on Work-Life Strategy, made up of MOM and its tripartite partners, has therefore begun work on a "Tripartite Advisory on Flexible Work Arrangements", intended to guide employers and employees on how to implement and utilise flexible work arrangements effectively.

I think this is useful, especially for smaller companies. I often hear about challenges that employers face when introducing flexible work arrangements. Allow me to cite an example. Epigram and Epigram Books decided to implement staggered hours, part-time work and telecommuting to improve employee engagement and productivity, as well as support their employees in improving their work-life fit. When rolling out flexible work options, the two companies had to overcome management and staff's mindset that employees on flexible work were less effective. At the same time, they had to learn to accommodate staff's differing work schedules and reporting times.

So, we recognise that it is not very easy for individual companies to implement Work-Life, but if they sit down and find out how it can benefit them as well as the workers, both the employees and the employers will benefit from this.

The advisory is purposed to help employers deal with such challenges, by setting out the expectations and responsibilities of employers and employees. We aim to issue it in the second half of 2014. Together with the Government's funding and enhancements to the national IT infrastructure to provide high-speed connectivity, we hope that this effort will result in greater buy-in and adoption of flexible work arrangements.

Assoc Prof Fatimah Lateef, Ms Ellen Lee and Ms Lee Li Lian have also called for pro-family workplace practices, specifically paid parent and eldercare leave, to be legislated. The PAP Women's Wing has suggested the same.

The Government will review the issue of legislated parent or eldercare leave, as part of the broader efforts to address the challenges of an ageing society. We are mindful that we have just implemented a series of enhanced and new leave schemes last year, as part of the Marriage and Parenthood package. We need to give businesses some time to adjust and adapt, not just to these leave requirements but also the broader effects of the economic restructuring and foreign manpower tightening. MOH will elaborate on some of their plans to step up support for caregivers.

Ms Foo Mee Har has also suggested that we consider measures, such as legislation, to accelerate the adoption of flexible work arrangements in Singapore. I know she has been talking about this for many years. We appreciate it and we will seek her views on how we can move forward in our future initiatives.

We fully agree that there is a need to foster the adoption of flexible work arrangements. But as with anti-discrimination, the fundamental issue we need to address is mindsets and attitudes.

It is important to encourage mindset shifts and positive behaviour through education and promotion. The tripartite advisory is one step forward in the right direction. That is what creates the necessary conditions for sustainable and successful work-life strategies. We agree with Ms Mary Liew that a concerted effort by the tripartite partners is necessary to change mindsets of employers and employees to address many of these issues. We encourage employers to offer their employees the necessary benefits and flexibilities which will enable them to fulfil their familial commitments. And we believe that, in the process, the employees will be more engaged, and may even be more loyal, and will stay long in the organisation.

We want to see work-life practices become a norm at the workplace. Good work-life harmony practices yield many benefits to both employees and employers. Employers have found that it leads to manifold tangible benefits, as I have said earlier – improved attraction and retention of talent, gains in productivity and reduced costs arising from less medical leave and absenteeism.

In this tight labour market and amidst stricter foreign manpower hiring policies, good employment practices such as flexible work arrangements will play a crucial role in incentivising Singaporeans who are economically inactive, for example, mothers, to return to work.

Mdm Chair, all the measures Acting Minister Tan Chuan-Jin, Senior Minister of State Amy Khor and I have spoken about ultimately have one simple common objective – to create a vibrant, resilient economy and workforce, good jobs and incomes, so that, ultimately, Singaporeans enjoy improvements to their lives.

The Government plays a fundamental role alongside the individual, society and the community in realising this objective. MOM will work hard to establish the necessary conditions and opportunities that will enable individual Singaporeans to secure better jobs and higher incomes for themselves and their families, and enjoy financial security in their retirement. For those particularly vulnerable to being left behind, we will step in with targeted help and stronger support.

Learning, re-learning, up-skilling to ensure that we remain relevant in the fast-evolving global economy is crucial; not just for blue collar workers, but even for highly skilled white collar ones.

Madam, our task is not easy, particularly in this time of economic restructuring. Acting Minister and Members of the House have articulated the complexities of manpower issues. MOM will press on to work with stakeholders and partners to aid improvements to the lives of Singaporeans through appropriate and sustainable manpower policies.

Madam, with your permission, may I ask the Clerk to distribute MOM's COS brief?

The Chairman: Yes, please. We have a bit of time for clarifications. Mrs Lina Chiam.

Mrs Lina Chiam: I thank the Senior Parliamentary Secretary for addressing my request for mandatory psychological test for maids. It was the same answer that he has given me last year and the previous years when my husband also asked for it. So, my husband and I have been advocating for this since then. And it is through feedback and experiences that I need to ask this is because it is going to be an escalating issue. It has been proven that this year, there were two cases: one in January and the latest one about four days ago. So, I think it is timely that his Ministry should consider my proposal and think carefully with an open mindset as we have been told that we always must have an open mindset. We should also think of the employers. Every time, we are always thinking of the employees, how they suffer, how we mistreat them —

The Chairman: Mrs Chiam, put your clarifications.

Mrs Lina Chiam: Okay. Please think of the employers for a change because of the levy they pay. It is timely that they should use some of this levy to pay for this psychological test for maids.

Mr Hawazi Daipi: Thank you, Mdm Chair. Mrs Chiam says we have been giving her the same answer. I remember her asking the same question. The issue remains the same: that it is not very easy to detect a potential FDW with psychological problems. We may be able to detect the worst cases. In any case, there is already the six-monthly health-screening that every FDW has to go through and the doctor may be able to detect if the FDW has some psychological problems.

On the cases that Mrs Chiam had referred to, especially the two recent cases, they are still under investigation by the Police, and I do not think we should comment on them.

4.00 pm

Mr Zainudin Nordin: Mdm Chair, I just wanted to touch on the CET/WSQ review. I am wondering whether beyond reaching the milestone of one million trainees last year, the progressive wage system and the WSQ can be squared together. If you look at the performance of WSQ, if it is really performing and having impact on the low-wage worker, how does it square with the progressive wage that we are trying to improve for the low-wage worker? Can we get some comments on how is WSQ improving the performance of our low-wage worker?

Dr Amy Khor Lean Suan: I said earlier in my speech that for WSQ, based on a recent WDA study, from 2008 to 2010, lower wage workers with WSQ Statements of Attainment (SOAs) did receive wage increments of between 2.6% and 4.6%, compared to those without SOAs. That is the differential that we have found. How it squares with the Progressive Wage Model is that the Progressive Wage Model, which is advocated by NTUC, helps the workers get fair pay based on their productivity, ability and skills, and to upgrade them so that they can do better, have higher value jobs and get higher pay. I think that with WSQ, they will be able to attain higher skills and better pay.

Dr Intan Azura Mokhtar: Senior Minister of State Dr Amy Khor earlier mentioned about the Professional Conversion Programme for Physiotherapists. I understand that there are also programmes for other professions as well. However, in particular for eldercare professionals and social workers, it is required that mid-career entrants have either a diploma or GCE "A" levels and we know that these are sectors where there will be increasing demand for eldercare workers and social workers. Would the Ministry consider extending this programme to something like a certificate programme for mid-career entrants for blue-collar workers or housewives, for example?

Dr Amy Khor Lean Suan: I think this will be better taken, and responded to, in MOH's COS. But in any case, indeed, for social workers, there is a requirement that there must be a minimum diploma, but we take the Member's point on converting some of these programmes into certification course. At MOH, we are also looking at whether we can have different levels, not just social workers, but different levels, just like therapy assistants and physiotherapists. So, we are looking at that at MOH.

Mr David Ong: As mentioned by the Acting Minister earlier, he said that inclusive growth and retirement adequacy are the key pillars supporting an economy for all Singaporeans. But currently we have 50% that does not reach the Minimum Sum. What can the Ministry do to have more of them be able to qualify or reach the Minimum Sum? Can we do more for those workers who are 55 years and above, looking at the employer's CPF contributions? At the same time also, can the Ministry consider schemes for responsible companies that may want to voluntarily restore senior workers' CPF in recognition for their loyalty and contributions to the company, perhaps even the corporate tax relief scheme?

Mr Tan Chuan-Jin: Mdm Chair, with regard to the Minimum Sum, we do recognise that there will be some individuals, across the different age bands, that would not be able to meet the Minimum Sum. In such cases where they do have challenges, there will be other schemes supporting them.

As I mentioned earlier, in terms of the way the Government approaches supporting individuals, from MOM's perspective, we provide one pillar and the CPF is one important pillar. But, importantly, we also have different schemes to support them in different ways. So, while the Minimum Sum is something that they will accumulate through their work, we recognise, especially for the older workers, for those who started work when wages were not quite as high and their contributions were not quite significant, many of them would not meet their Minimum Sum. The challenges that they face would be supplemented in different ways but not necessarily from CPF scheme itself.

As to whether some companies may be open to contributing more to their workers, in terms of rewarding them, that is something that we can look at, although I suspect that companies would contribute in different ways. But that is something we can look at, if companies are actually keen to contribute more via the CPF route.

Ms Foo Mee Har: Madam, I would like to talk about flexi-work. Members have previously spoken many times on this subject. In my view, I think Singapore can make a lot more progress. There was a question asking MOM how successful the interventions have been. With the announcement that the Senior Parliamentary Secretary just made that 160,000 grants over three years and yet we only have less than 10 —

The Chairman: Ms Foo, not a speech, please. Just put your clarification.

Ms Foo Mee Har: Okay, my clarification. I would like to ask the Government to look at quite a different approach. I understand that a lot of efforts have gone in, but I think the efforts have not been bearing the results we want. I would like to offer help to lead, say, an industry together with the Government, to see if we can do just like how the UK did it. The UK Government and Deputy Prime Minister Nick Clegg got 22 top companies in the UK to champion this because they have seen such great results.

The Chairman: Your clarification, please, Ms Foo.

Ms Foo Mee Har: So, if I could just offer my service. Thank you.

Mr Hawazi Daipi: I thank the Member for the question. Rest assured we are watching what other countries are doing in this regard. We do want to help both the employees as well as the employers manage this because, ultimately, it would benefit both the employees and the employers.

It is not that easy to just decide on legislating work-life balance because we do not know how the take-up will be. UK has been practising the "right to ask" among workers. We are watching the progress. We are also studying the practices and the experiences of other countries, like Australia, Japan and many states or many cities in the US and we will see what fits us well.

In the UK, you have 22 companies championing work-life balance; in Singapore, we have more than a hundred companies doing this, CEOs reaching out to fellow CEOs to advocate work-life balance. We recognise that. While in many companies, the CEOs may be enlightened, the rank and file, the line managers may not be equipped enough with the knowledge on how to practise work-life, how to manage workers who want to work from home, apart from finding the resources to buy the equipment which we have been supporting. We are studying this.

What we thought we would like to continue to do is to use the promotional educational approach. The work of the employer alliance led by Ms Claire Chiang has been very good because CEOs reached out to the CEOs and now another approach is to help the line managers, the HR practitioners in the companies to have the knowledge to manage work-life strategies.

It is not so much about a system where there is legislation or promotion but it is the how-to, developing their capability and the awareness of managing people, workers who need it and seeing that from among the workers and seeing how the management may be very enlightened in helping the workers.

The Chairman: Ms Irene Ng, keep it short, please.

Ms Irene Ng Phek Hoong (Tampines): Madam, many low-income workers live on a very tight budget and rely on their CPF to pay for the HDB loans and the education loans. And after they hit 55, their fund transfer goes into the Retirement Account and they find themselves finding it difficult to meet their obligations. Can I ask the Minister whether he would review the amount of the funds transfer at the age of 55 from the OA to the RA to take into account their existing loan obligations so that they would not have to be in greater hardship after they hit 55?

Mr Tan Chuan-Jin: Mdm Chair, I think this is a valid concern. I would say that, from the onset, we do advise, and this is what HDB does as well, families not to overextend themselves. Many of us as Members of Parliament would have encountered this when our residents come and ask us to appeal for a larger loan for them. HDB sometimes advises that they may only be eligible for slightly smaller loans.

There is a good reason for this and that is to make sure that families do not overextend. When they overextend, and sometimes when they do end up unemployed, it impacts on repayment and eventually it will come to a head when they reach age 55.

That is a real concern. But as we have mentioned before, we do take a look at every individual case and see whether we are able to support them in different ways. At present, we have no plans to review that specifically. Where there are challenges when they hit 55, that is something that we can look at on a case-by-case basis.

The Chairman: Mr Zainudin Nordin, would you like to withdraw your amendment?

Mr Zainudin Nordin: I would like to thank Acting Minister Tan, Senior Minister of State Khor and Senior Parliamentary Secretary Hawazi for their very comprehensive response. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $1,192,501,600 for Head S ordered to stand part of the Main Estimates.

The sum of $53,891,200 for Head S ordered to stand part of the Development Estimates.

The Chairman: Order, I propose to take the break now.

Thereupon Mdm Speaker left the Chair of the Committee and took the Chair of the House.

Mdm Speaker: I suspend the Sitting and will take the Chair again at 4.30 pm.

Sitting accordingly suspended

at 4.14 pm until 4.30 pm.

Sitting resumed at 4.30 pm

[Mdm Speaker in the Chair] [Mdm Speaker in the Chair]: ****

Debate in Committee of Supply resumed.

[Mdm Speaker in the Chair]