HEAD S - MINISTRY OF MANPOWER

Head S – Ministry of Manpower (cont.)

Resumption of Debate on Question [11 March, 2010],

"That the total sum to be allocated for Head S of the Estimates be reduced by $100." – [Mdm Halimah Yacob].

Question again proposed.

12.15 pm

Adopting cultural diversity at work

Mrs Mildred Tan (Nominated Member): Sir, in recent months, we have spoken

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about the need to integrate the foreign talents in our midst. In the social space, there may be some tension – assimilating a large inflow of foreigners in our Housing Board void decks, playgrounds and exercise parks, and that is not easy.

But I believe that there is a more neutral territory in which integration can begin – and that is at the workplace. Considering Singapore's large foreign workforce, would MOM incentivise companies to adopt work practices that promote social cohesion to enhance productivity and good teamwork?

Sir, in other countries, this is called "diversity training" which requires people to understand and be sensitive to the needs and cultural background of their co-workers. Many large MNCs require their teams to do this in Singapore. In some companies, there are also "Diversity Managers" specifically employed to look after this area.

Sir, can we support a movement towards this by building on the existing harmony circles that are already in place in workplaces to promote social integration?

Sir, I understand that such circles were meant to promote inter-racial harmony among Singaporeans but why not use them to promote integration among colleagues too? I would ask for a $1 million funding – one-tenth of the same amount given to the National Integration Council – to test-bed integration efforts at the workplace, especially in SMEs. This money could be given to diversity training, to organising social activities and programmes, and even for study trips. Now, what will we be getting for this $1 million?

Firstly, promoting teamwork increases efficiency. This is not merely a matter of

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greater productivity but also in the cases of some foreign workers who work in shipyards, construction sites and even the manufacturing sector. This may even impact workplace safety. Teamwork means you look after one another and ensure that the other person works safely as well as efficiently.

Secondly, a people matter – it builds a better, happier team. People who are happy work better, stay longer, and create a more convivial workplace atmosphere if they are happy with their co-workers.

Thirdly, an innovation issue. Teams which work well together are more innovative, generate new ideas, flexible and inject new life into an organisation.

If the benefits from this pilot project become more clear, then more companies, too, will want to join this movement to embrace diversity at the workplace and the Government can support with some co-funding.

While these three benefits accrue directly to the company, Singapore, as a whole, will gain and benefit as well. A better understanding of other cultures and people at the workplace will translate to enhancing the social living space. After all, Singapore began as a melting pot of different races with a common ground of finding work and building a future – we start with embracing workplace diversity and, hopefully, celebrating a shared future.

The Minister of State for Manpower (Mr Lee Yi Shyan): Mr Chairman, my Minister has laid out our plans to improve productivity and expand Continuing Education and Training (CET) in response to recommendations of the Economic Strategies Committee. Let me elaborate on these plans, in particular, how we will

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be upskilling Professionals, Managers, Executives and Technicians (PMETs).

When WDA first started in 2003, our priority was to equip our rank-and-file workers with skills to overcome structural unemployment. Over time however, as the proportion of the PMETs increased in our workforce to 52%, we clearly had to adjust our CET model to cater more to PMETs' needs. Mr Zainudin Nordin, Mr Seng Han Thong and Mr Wee Siew Kim requested an update on what MOM was doing to help PMETs upgrade themselves.

Sir, 2009 was a milestone year for PMETs as far as CET is concerned. There were two key achievements. One, we introduced an umbrella programme called the Professional Skills Programme (PSP) for PMETs. The PSP brought together the entire range of training programmes and services available to PMETs under our CET system. Two, from December 2008 to January this year, around 71,500 PMETs have gone for CET training. This accounts for a third of the 204,000 workers trained under CET in 2009.

Yet, our plan going forward is an ambitious one. In 2009, we had 50,000 PMET training places available. We want to increase this to 240,000 by 2015. This is five times the current 50,000 in terms of capacity. And this would mean one in three training places will be designated for PMETs. It is an enormous effort but a necessary step jump.

Apart from quantitative changes, we are also making fundamental qualitative changes to the CET system for PMETs in four ways. One, helping PMETs acquire horizontal skills; two, helping PMETs deepen their professional skills and expertise; three, enabling PMETs to acquire new skills for new industries; and four, enhancing effectiveness of career services. Let me elaborate on each of these four changes.

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First, to help PMETs develop horizontal skills, or making them more "T-shaped", we will expand the range of such programmes available. Consider the recently introduced WSQ Manufacturing Sales and Marketing programme. Programmes like this aim to equip engineers and technicians in the manufacturing sector with functional sales and marketing skills. Through a tie-up with IE Singapore, the programme will also expose them working in different countries by way of overseas attachments. In this way, these otherwise purely technical professionals will become marketing and sales-savvy. Being more all-rounded, they will help their companies grow by increasing companies' top lines.

To expand the range of horizontal programmes, we will launch a WSQ programme series in Business Management later this year. This will cover 10 key horizontal skills areas, including sales and marketing, negotiation, and risk management. This series will further enhance the versatility of our technical PMETs so that they can multi-task and become more valuable to their employers.

Next, we want to help PMETs deepen their specialist skills along certain functional areas. How do we achieve this? For functional areas that are already served by WSQ programmes, we will create more vertical upgrading paths at the diploma, degree and even postgraduate level.

We will target programmes which are critical in ensuring our industries remain competitive. For instance, we have introduced a Graduate Diploma in Systems Analysis with NUS and a Masters in Sustainable Building Design with the University of Nottingham.

Just two weeks ago, I attended the launch of two new WSQ graduate diplomas – one in Product Life

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Management and the other in Engineering Simulation for PMETs in the manufacturing sector. I am confident that these programmes will help our engineers and manufacturing professionals deepen their capabilities.

Over the next five years, we will build more vertical upgrade paths for PMETs in key growing sectors such as digital animation, human resources, aerospace, environmental technology, sustainable manufacturing and energy management.

Third, we want to create more skill conversion programmes for PMETs who are interested to switch to a new growth sector or industry. Sir, we have already put in place 50 conversion programmes so far. They open up a new world of opportunities in professions such as chefs, occupational therapists, pre-school teachers, social workers, hospitality managers, public relations executives, scriptwriters, designers and aircraft engineers for the PMETs.

In 2009, about 1,700 trainees have signed up for conversion training, of which 500 of them were placed in related jobs. Two hundred have completed their training. I am certain that the rest who are still undergoing training will stand in good stead to switch to a new occupation of their choice.

Finally, in addition to training, some of our PMETs would also require career services that are tailored to their needs. This is especially true for those who have been in the same line for many years and need to update their understanding of the labour market or to refresh their career skills.

WDA, together with the Community Development Councils (CDCs) and e2i, has launched a series of career skills workshops targeted at PMET job-seekers. The workshops covered a range of topics including resume writing, job search and

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interview skills. There are also recruitment events and advisory services provided by trainers or coaches.

Since the start of SPUR, we have reached out to about 1,100 PMETs through career skills workshops. I am happy to report that the response continues even as the economy recovers. WDA will continue to fine-tune these services to better meet the needs of our PMETs.

All our efforts under the Professional Skills Programme are bearing fruit. Many PMETs have taken upgrading seriously as they see the need to stay current and relevant to the changing job market.

Mr Jayern Woo is 29 years old and a business development manager who holds a Mechanical Engineering degree. After working in his company for just two years, he recognised the importance of upgrading himself to advance his career. He enrolled for the Precision Engineering WSQ Specialist Diploma at the Singapore Institute of Manufacturing Technology in July last year. Together with more than 30 other like-minded individuals, he has kept abreast of the latest complex technologies critical for the precision engineering sector.

We spoke to Mr Woo recently and he revealed that he truly appreciates the chance to build valuable relationships with industry experts. Keeping updated on the latest technology in the industry has also helped him to be more confident when promoting his company's services to potential clients. It is always heartening to hear how our upgrading programmes have real impact on the working experiences of our trainees.

Other PMETs have used the CET system to successfully switch careers. Ms Jasmine Hu was in the finance

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industry for 12 years and held various roles from sales, to training, to customer service and even stock trading. She was also volunteering at a special school for autistic children when she decided to further her studies and work towards becoming a lecturer in pre-school education.

Ms Jasmine Hu then enrolled in a conversion programme as a stepping stone. She will graduate from the programme at the end of this year and would have enjoyed Government subsidies of 90% of the course fees on top of a monthly training allowance of $1,000.

During her pre-school attachment, however, she was inspired to be closer to the ground and decided she wanted to set up her own pre-school centre instead. Not just any pre-school, but one for children with different learning needs. From the financial industry, to attending a pre-school conversion programme to a budding entrepreneur dedicated to pre-school education, Ms Jasmine Hu's learning and development journey is an inspiring one. If she succeeds, and I am sure she will, our CET conversion programme would have done more than just helping people switch jobs, but also enabled them to realise their dreams. The latest is that Ms Jasmine Hu is now looking for a location to build her new school.

Sir, let us take a step back and consider the larger picture. According to a survey in the United States, an average worker is likely to change jobs 10 times between the ages of 18 and 38. In Singapore, our own data shows that about one out of three workers aged 25 to 29 changed jobs within the previous two years. Among those in their 30s, about one out of four of them changed jobs in the previous two years. Sir, we operate in a globalised world where industry and therefore job requirements change at quickened pace.

Our workforce,

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including PMETs, must be on their toes in upgrading themselves.

12.30 pm

In view of this, we have been developing a CET system that is responsive to our economic needs and new developments world-wide. Mdm Ho Geok Choo mentioned the UK Skills Account, which is an online skills account that provides information on life-long learning and individual training pathways. Mdm Ho will be pleased to know that WDA is looking into such an online self-service portal for individuals to help them monitor and plan their own training.

Since the launch of the CET Masterplan in 2008, we have quietly but resolutely made a commitment to life-long learning and upgrading of our workforce. While the spending in CET system accounts for only between 0.1% and 0.2% of the GDP today, compared to 0.3% in some other advanced economies, we believe we have made a fundamental shift, a strategic step towards keeping our workforce relevant, current and agile. We have made a great start and we will ensure Singapore's workforce remains the world's most competitive by putting in more resources for a first-class CET system.

Mr Charles Chong has asked why there was an increase in training fund disbursed while the overall participation rate among the resident labour force declined. He also pointed to the declining job placement rate in the last two years.

On his first point, the training participation rate takes into account all forms of training and education activities, including those supported or provided by companies. In view of the severe economic downturn in 2009, many individuals and companies scaled back on training. At the same time, in response to the economic recession, the Government

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rolled out the now well-known SPUR to help companies and workers manage the downturn and invest in skills for the recovery. We saw a larger proportion of trainees taking up Government-supported courses. Without SPUR, the decline in overall resident training participation rate could have been worse.

On his second point, although the number of job placements between FY2007 and FY2009 increased in absolute numbers from 16,700 to 24,000, the number of new job seekers increased even more due to the recession in 2008. With the recovering economy, we can expect the number of new job seekers to decline. But we still expect a group of job seekers who lack the skills for new jobs and will need to be trained before they can get these new jobs.

Let me assure Mr Hri Kumar that the CET will also remain affordable to workers. Today, courses under the CET system are already heavily subsidised by the Government with up to 90% of the course fees subsidised under SPUR, including selected tertiary courses. In addition, WSQ course fees can be paid on a per-module basis and some CET centres allow deferred payment arrangements on a case-by-case basis.

Low-wage workers can now benefit from both Workfare Income Supplement and Workfare Training Scheme. Those who face financial difficulties can also approach our Career Centres at the CDCs or e2i, or seek assistance from NTUC and the self-help groups which provide additional training subsidies under the Surrogate Employer Programme.

In addition, MOE has a Tuition Fee Loan Scheme which includes graduate research programmes and Government-subsidised coursework graduate programmes, and various banks also provide education loans. The recent announcement in the Budget Statement to enhance

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course fee tax relief for individuals from $3,500 to $5,500 will also be helpful.

In summary, there are many channels available and it is unclear at this moment that there is a further need for a Government-run loan scheme. But if there is a gap, and if Members of Parliament come across deserving cases, please refer them to MOM or WDA, and we will be happy to take a look.

Sir, we believe our investments in a first-class CET system will be beneficial for our workers and companies. But our investments cannot produce the kind of outcome we hope for if our employers and workforce do not take collective and individual ownership towards upgrading and life-long learning. I therefore appeal to all employers and workers, PMETs and others, to take full advantage of the training places made available under CET to learn, grow and to stay meaningfully employed.

Sir, now, let me touch on a slightly different aspect of PMETs – the proposed employment dispute resolution mechanism.

Mdm Halimah Yacob has asked for an update on the progress on the dispute referred to MOM for PMEs. On average, about 270 executives seek MOM's assistance each year. Close to half of them were resolved with MOM's help, while the rest sought settlement with their employers or were withdrawn. Some went on to settle their disputes through civil litigation. On the progress of the dispute resolution mechanism, I am pleased to report to the House that the feedback from our tripartite partners has been positive so far. Employers recognise the growing segment of PMEs and the benefits of having tripartite partners play a role in resolving employment disputes. Unions have also expressed strong support for the mechanism as it will allow

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them to reach out to PME union members when employment disputes arise. In general, most agree that it will be a cost effective and a speedy avenue for employment dispute resolution. We target to implement this new mechanism in 2011.

Sir, the ESC also suggested that we should adopt good employment practices on foreign workers. I would now like to touch on our ongoing efforts to improve foreign worker recruitment practices.

As part of our national productivity drive, we are emphasising the importance of workforce training and re-skilling alongside other measures, such as innovation, process re-engineering and adoption of technology. Good recruitment practices, pertaining to foreign workers, will also strengthen Singapore as an attractive destination for experienced and skilled foreign workforce, who can help us achieve productivity-driven growth.

In the management of foreign workers, employment agents play a key role. Mr Charles Chong has observed that there was a spike in the number of errant employment agencies from 2008 and 2009. Mr Yeo Guat Kwang has also asked for better protection of employers and workers' interest from the services of some employment agencies.

MOM treats this subject seriously. We are currently reviewing the Employment Agencies regulatory framework to improve compliance and minimise malpractices.

The current situation is this: the Employment Agencies Act was last amended in 1984. Since then, the number of employment agencies has increased seven-fold to just over 2,300 at the end of 2009. Low barriers to entry and a growing foreign worker population have led to more malpractices in the industry

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and insufficient differentiation between good and poor agencies.

Last year, we received 1,280 complaints from employers, foreign workers and members of the public regarding employment agency malpractices. This was an 80% increase compared to the year before. While part of the reason for the spike in errant agencies was the fact that we ramped up our enforcement actions in the past year, we recognise that we need to strengthen our regulatory system to check on malpractices. Our review of the framework aims to achieve four objectives.

First, we intend to update the coverage and provisions in the framework. Currently, unlicensed employment agencies merely face penalties for operating as an unlicensed agency. One of our key changes is to ensure that they will be subject to employment agency regulations. Apart from imposing penalties on unlicensed employment agencies, we also want to discourage transactions between employers with any unlicensed employment agencies. By making it an offence for persons to knowingly engage an unlicensed employment agency, we intend to break the collusions involving kickbacks between employment agencies and errant employers.

We aim to expand the coverage of the Act to ensure that employment agency personnel will be accountable for their actions. Currently, all agencies are not restricted in who they employ to perform recruitment or placement work. To ensure all key appointment holders and staff performing recruitment or placement work are appropriately qualified, we will impose certain requirements on them such as tests on knowledge of relevant laws. This will raise the standards and accountability of the employment agency personnel.

We will also update the caps on fees charged by agents to employers and workers, including transfer fees, to reflect

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market realities. This will address Mr Yeo Guat Kwang's suggestion that we review the fee caps in the Employment Agencies Act and make both placement and transfer fees paid to employment agencies more transparent and realistic.

Our second objective in the review of the employment agencies framework is to ensure adequate deterrence. This will involve increasing our penalties for some offences to impose costs that are commensurate with the large potential gains from malpractices. For example, the maximum penalty for operating an employment agency without a licence today stands at $5,000 and this pales in comparison to the fees that some foreign workers are willing to pay to come to Singapore.

We will also expand the range of our enforcement options in order to calibrate our actions for offences of different gravities. This will include introducing the power to compound all offences and not just some of them. Suspending the operations of agencies undergoing investigations will also be an option.

Third, we aim to better ensure minimum service standards when employment agencies deal with employers. Accreditation is mandatory for agencies that place foreign domestic workers. The minimum service standards under the current accreditation framework will be moved into the licensing conditions. This will ensure that these requirements have the force of law, and that all agencies, including those not recruiting domestic workers, are subject to those requirements.

Mr Yeo Guat Kwang had two suggestions. One is to mandate one rest day per week for all foreign domestic workers and to require all employment agencies to have a written contract with each worker and each employer. On his first suggestion, accredition is mandatory for agencies that place foreign domestic

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workers and accredited agencies already use the standard employment contract that requires employers to stipulate, among others, the number of rest days per month. Zero is not an option. It also stipulates the amount of compensation the foreign domestic worker should receive, if they agree to work on their rest day. Failure to provide the agreed number of rest days or compensation in lieu is a breach of the Work Permit conditions, as is the failure to provide adequate rest.

On his second suggestion, we already have the standard service agreement and the standard employment contract. What is missing is a standard service agreement for employment agencies and foreign domestic workers. We agree that such a service agreement could be developed, and would help reduce downstream disputes. We could also develop a similar set of standard agreements for non-domestic foreign workers and their employers or their employment agencies. As these types of standard service agreements would have to be developed from scratch in consultation with the industry, we will consider mandating them after we have had some time to pilot and refine them.

Beyond making minimum service standards part of licensing conditions, we will also encourage accreditation bodies, such as the Association of Employment Agencies Singapore and CaseTrust, to introduce a new voluntary trust mark scheme. The objective is to differentiate the better agencies by indicating the quality achievements of employment agencies to potential employers. We will be working closely with the accreditation bodies to develop the new trust mark scheme.

Finally, our proposed changes to the employment agencies regulatory framework will place greater onus and

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compliance burden on employment agencies that deal with vulnerable workers. For headhunters and executive search firms, they will continue to be managed with a light touch.

Sir, we can all look forward to many progressive changes to the employment agencies regulatory framework in this coming year. We hope to ensure better compliance and improve the standard of recruitment practices among employment agencies in Singapore. In doing so, Singapore will remain a choice destination for experienced and skilled foreign workers. They, in turn, can make valuable contributions towards our objective of developing a sustainable and a productivity-driven economy.

12.45 pm

Promoting flexible workplaces

Mdm Halimah Yacob (Jurong): Sir, our labour force participation rate of 55% is much lower than that of the Scandinavian countries which have a rate of more than 70%. A key defence is that flexi-work is readily available in Scandinavia whereas in Singapore it is less so. In a survey by the NTUC Women's Development secretariat, common obstacles cited by employers were costs, difficulty in managing workload during employee absences and disruption to workflow. On the other hand, many female job seekers seeking to re-enter the workforce, when asked, prefer to do flexi-work because of their care-giving responsibilities. So there is a mismatch.

According to MOM's Labour Force Survey, about 60,000 economically inactive women want to return to work over the next two years. At least, 40% of them in the age group 30-39 years have diplomas or university degrees. PMET homemakers face special obstacles to return to work. I met a 43-year old PMET resident who is a homemaker but

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wants to return to work. Although she is a degree holder and had handled big projects before, all the companies told her that her career break worked against her. This is unfair as in our society women are still the main caregivers.

I would like to ask the Minister what more can be done to assist our women. Has the Ministry done a further study to determine what are the factors that contribute to the success of flexi-work in other countries, and how this could be applied? Could the Minister consider funding special training programmes for back-to-work women PMETs to make them more employable?

Work-life balance

Assoc. Prof. Paulin Tay Straughan (Nominated Member): Sir, a sensible work-life balance is a key to making Singapore a distinctive global city and an endearing home. Work-life balance is now more critical than ever as Singapore faces a labour crunch and a sustained ultra low fertility. As our population ages, in addition to childcare, families will also be burdened with eldercare demands. On this regard, with increased demands from both work and family, I have the following questions for the Minister. To respond to childcare and eldercare demands, employees require flexibility in their work schedule. This allows them to stay engaged in the workforce and, at the same time, honour their care-giving responsibilities. Can the Minister highlight employers who have progressive HR management philosophies and who prescribe flexibility at the workplace? What measures will MOM take to promote greater flexibility in work schedules to facilitate child and eldercare responsibilities of employees? As the population ages, will the Ministry consider instituting eldercare leave options to facilitate step-down homecare for dependent elderly? Can we consider broadening the existing

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unrecorded childcare leave to include eldercare?

I understand that this will incur greater operating costs for employers, but can we afford to render invisible this critical care-giving responsibility? While we can choose not to have children, we certainly cannot ignore the needs of our ageing parents.

The rise in dual-income families and the increase in median age at first birth mean that many adult children are still engage in work as their parents move into a dependency phase. And they cannot afford to step back from work because they need the income to sustain the family. Now, more than ever, Singaporeans need the Government's support to recognise their care-giving roles. The rigidity of paid work may cause strains on inter-generational relations if eldercare becomes a burden and source for tension for the family.

Even private businesses cannot take on the cost of eldercare at this point. Will the civil service consider taking the lead in this important initiative?

On recorded childcare leave, I have never understood why we give time off for parents to take care of a six-year-old child, but that privilege is not extended to the care of a seven-year-old child. Will MOM also consider extending the eligibility for unrecorded childcare leave to parents which children under 12 years? Parenting young teens is an equally demanding responsibility.

Singapore workers register one of the highest average hours worked per week in the world. Every additional hour spent at paid work is one less hour for family work. To have a more accurate assessment of how much time employees are committing to paid work, may I appeal to the Ministry of Manpower to develop a systematic way of tracking overtime work, both paid overtime and especially

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unpaid overtime? This will provide important data on work-life patterns in Singapore and alert us on what can be done to help Singaporeans achieve a good balance between paid work and family responsibilities.

At the risk of sounding like a broken record, I cannot stress enough the importance of striving for a sensible work-life balance. With the exception of a minority who are privileged with wealth, most of us are dependent on paid work to sustain our everyday life. This make policies governing paid work central to our lives. And contrary to arguments that Singaporeans have the flexibility to choose when to work and how much to spend on work, this may not be case on the ground where the organisational culture is focused solely on profit margins and they neglect the well-being of their staff holistically. This is particularly so with the performance-based evaluation system which focuses on output and pits employees against each other. For those who are keen to win the race, they would run and they would run light and strive to carry minimum luggage. So, this may explain for the increase in singlehood rates, the increase in the proportion of DINKS – dual income, no kids – and the increase in small family size. As the leader for manpower, I look to the Minister to watch over the well-being of the Singaporean worker and to cultivate a nurturing work environment in Singapore – one that invests in human resource holistically and facilitates a sensible balance between work and family.

Training and development of contract workforce

The Minister of State, Prime Minister's Office (Mr Heng Chee How): Sir, faced with an increasingly volatile, unpredictable and fiercely competitive operating environment, many companies have

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switched to a flexible just-in-time workforce. This workforce comprises a small core and a significant flexible component of part-timers, temps and freelancers, trainees, contract and casual workers. In this way, they seek to match supply and demand of manpower and drive down costs. Another response from companies is to outsource what they deem to be non-core work. Official statistics confirm the growth of such a non-traditional workforce.

With the drive towards higher productivity, more companies can be expected to outsource and also enlarge their flexible workforce as they focus even more on cost savings. The labour movement firmly believes that outsourcing and value-for-money can and must be achieved on a sustainable basis. Cost savings for companies need not and must not be at the expense of workers, especially lower-wage workers. It must come out of better productivity backed by better designed jobs, better trained workers, better organisation of work and better use of technology. For this reason, the labour movement pushed hard with the job re-creation programme and the best sourcing initiative over the past six years, and also reached out to lower-wage and contract workers through the Unit for Casual and Contract Workers (UCCW). Unions representing such workers also pay special attention to their interests during collective bargaining.

The NTUC e2i helped train and upgrade thousands of low-wage workers. These programmes combined fair buying on the one hand with improved job value on the other so that both buyers and workers win. The going was far from easy, given the economic forces that play, but the labour movement is never deterred by hard work if that makes a real difference. We are encouraged by the example and perseverance of many low-wage workers across different industries

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who have since upgraded their jobs, their skills and they pay.

Moving forward, we must make sure that the foreign groups are given the help they need through SPUR, WTS and other schemes to stay employable amid the outsourcing and flexible arrangements and to share in the productivity gains. The groups, firstly, low-wage workers on contract of service with companies.

Second, lower-wage workers who belong outsourcing companies by providers. Buyers of such services may not see their role to train them. The outsourcing providers may not focus on training of low-wage workers as they service multiple clients over multiple sites and the varied duration of contracts.

Third, lower-wage freelancing workers who do not belong to companies and thus may fall in between traditional arrangements that cater to companies.

I would like to ask the MOM how it intends to maximise the enrolment of low-wage and contract workers in the above three categories into the various training support schemes. What additional resources will be committed towards outreach efforts for these groups? What target outcomes will be set for their training and upgrading, and how can we better assure that such workers also get their fair share of the productivity drive?

Low-wage, casual and contract workers

Mr Zainudin Nordin (Bishan-Toa Payoh): Sir, according to the latest Singapore workforce report, nearly 30% of the resident employees are on term contracts. This is about 197,000. The percentage of part-timers in the resident workforce rose from 6.8% last year to 8.4% this year. With such a high proportion of employees currently in contract and part-time positions and with the percentages rising, the very nature of employment has substantially changed. This steady rise is

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expected to continue and we need to be concerned. This is because contract workers comprise a higher number of low-skilled, low-wage workers who are usually of low education and age above 45. They work as cleaners, hawker assistants, packers and factory line operators among other things, and earn between $500 and $1,200 a month. Casual and contract workers, unlike permanent ones, are typically not entitled to any benefits, bonus healthcare, and during recessions, they are the first to go.

At the NTUC's Unit for Casual and Contract Workers (UCCW), we assist the low-wage casual and contract workers on issues of non-payment of wages, CPF, WIS, annual leave and medical benefits, which I help, Sir. Apparently, many of these contract workers are illiterate and cannot read their employment contracts. Many are even employed without contracts. It is the plight of the lower-skilled workers that is heart wrenching and calls for attention.

What have been some of the responses to this dilemma? There have been several and I shall list them. One view is that the workers themselves must find their way out of the situation. How? By upgrading their skills to break out of the vicious cycle. This is a long-term solution. Hence, the mantra should be – Singaporeans must learn to be better, faster and cheaper. Sir, our critics argue that even with retraining and continued education, only 6% of workers receive a pay rise after attending courses like SPUR. More importantly, employers are not willing to pay more for skilled Singaporeans when foreign workers may be the cheaper alternatives.

With regard to the low-wage and casual contract workers, I would like to ask the Minister if the proposed changes to WIS unveiled yesterday and the introduction of WTS will be sufficient in addressing the perennial problems of low-

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wage casual and contract workers. Are there still loopholes and excuses that employers can exploit to avoid treating the casual and contract workers fairly? We must be cognisant that the jarring difference in treatment given to contract workers and permanent ones may polarise our workforce. This can weaken our social fabric. Job creation and social protection should be the call elements of our economic recovery.

Are we willing to relook at policy and law that will be more effective in protecting the rights of low-wage casual and contract workers, keeping in mind that we want to achieve an inclusive growth?

Well-being of foreign domestic workers

Mr Seng Han Thong (Yio Chu Kang): ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Sir, we have 200,000 foreign domestic workers in Singapore. With an ageing population, more families are employing foreign domestic workers to care for the elderly. The Chinese has an old saying – "An elder at home is a treasure". As the elderly person becomes less mobile, a maid could make his life more comfortable.

When I visited friends and relatives or attended group gatherings during the Chinese New Year, I noticed that many people talked about their maids such as how much they are paid, how they perform and how many days off they have and how they are compensated in-lieu of day-off.

Most Singaporeans treat their maids very well. I have seen a case whereby the employer took the breast cancer-stricken maid to the hospital for treatment every day. Some maids helped raised the children and they even fly back to attend the kids’ wedding here.

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The Tripartite partners have guidelines on how to look after the welfare of foreign domestic workers. Does MOM have similar guidelines to help both the maids and employers? At the moment, we have some negative media reports about employers abusing their maids. However, this is a small minority. We can emphasise those good examples. As our population ages, these maids can help us and we must ensure a cordial relationship between the employers and the domestic workers.

1.00 pm

The Parliamentary Secretary to the Minister for Trade and Industry and Acting Minister for Information, Communications and the Arts (Mr Sam Tan Chin Siong): Sir, foreign domestic workers are an important part of the Singapore household. They cook our meals, clean our houses and, for some of us, they raise our children. At the same time, when they fail to perform their duties up to the expectations of their employers, then both sides will suffer.

So the employers' ability to manage the household affairs is disrupted. A foreign domestic worker often has to be transferred to another employer. In the process, it incurs more debts. Employers find it difficult to tell whether a foreign domestic worker will meet their needs, just based on the information provided by the employment agencies or the interviews they conduct with the foreign domestic worker. Given the stories we have heard and read, I would like to ask MOM two questions:

(i) how significant is the problem of the foreign domestic workers being rejected by the employers simply because they do not have the necessary skills and experience;

(ii) what plans does the MOM have to reduce such mis-matches?

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Sir, I think the current situation is a rather uneven one where the employer can change their maid, but the maid cannot change the employer, except for running away. We ought have a recourse where a maid can do so, without fuss, rancour or hard feelings on both sides.

The Senior Parliamentary Secretary to the Minister for Manpower (Mr Hawazi Daipi): Sir, even as we upgrade our workers, we need to ensure our high labour and workplace standards that support a productive workforce. I shall now elaborate on the efforts to promote safe and progressive workplaces for both local and foreign workers.

I agree with Mr Yeo Guat Kwang that we must not overlook safety in our pursuit of productivity. In fact, I would emphasise that a safe working environment can contribute to the productivity of employees. The DGUV, an association of the German Accident Insurance Institutions, shared its pilot study on "Return on Prevention" with me at the end of last year. The study showed that accident prevention measures improved productivity. They reduce production shortages, remove the needs to replace and retrain injured staff and resulted in better staff satisfaction. In fact the study estimated that every one Euro invested in workplace safety and health (WSH) prevention measures, produced economic returns of 1.60 Euros.

Mr Yeo Guat Kwang and Mr Charles Chong have pointed out that we have made steady progress in improving our safety and health outcomes, bringing down our workplace fatality rate, from 4.9 per 100,000 employers in 2004 to 2.8 in 2008. While our workplace fatality rate is one of the lowest in the Asian region, we share Mr Chong's concern on the stagnation of the pace of our progress in recent years.

Sir, however, at this outset, I would like to clarify that the workplace fatality

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rate increased marginally, from 2.8 in 2008 to 2.9 in 2009. The absolute number of fatalities increased from 67 in 2008 to 70 last year, not the numbers extrapolated by Mr Chong. Our journey to improve WSH standards is a continuous one and we will face many challenges along the way. We will continue to push the boundaries to further improve our workplace safety and health performance and stay the course to reach our long-term goal of bringing our workplace fatality rate to below 1.8 by 2018. This will put us on par with leading-edge countries such as Sweden and the United Kingdom. Mr Chong has suggested the target of zero fatality, this is something we should always strive for. In fact, we have reached out to CEOs of major firms in the construction and marine industry in pursuit of this objective. Indeed, one death is one death too many.

Implementing WSH 2018, our national strategy for workplace safety and health, will remain a priority in 2010. I will now elaborate on our key initiatives this year. As Mr Chong has highlighted, the construction and marine sectors accounted for 63% of the workplace fatalities last year. We will continue to address the challenges in these two risky sectors in 2010. MOM and WSH council have developed sectoral plans to guide the construction and marine sectors in the implementation of the WSH 2018. The plans have set a target of reducing the fatality rates in these two sectors by 50% by 2013. And eventually bring them below 1.8 by 2018. The finalised plans will be released later this month.

Besides addressing sector-specific risks, we will also work with industry to tackle riskier work activities conducted across several sectors. Last year, the industry took the helm and formed two task forces to improve the safety of work at height and crane operations. The task forces identified gaps in safety manage

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ment and made recommendations ranging from capability building, promotion and outreach to regulatory issues. We have been working closely with the industry to implement these recommendations. For example, the WSH Council had developed a new Code of Practice for Working Safely at Height. This new Code or Practice and the revised Code of Practice for the safe use of mobile cranes have been legislated as Approved Codes of Practice under the Workplace Safety and Health Act. The task forces will be providing a detailed update on the progress later this month.

Mr Chong also asked for an update on the new WSH (Confined Spaces) Regulations. The Regulations came into force on the 1st November 2009. To assist the industry in meeting the requirements under the Regulations, we have released the Confined Space Kit. It included materials such as a safety guide book for supervisors and workers. The WSH Council has also developed a Technical Advisory on Work in Confined Spaces in consultation with the industry. We will continue to work with industry to ensure that they can carry out work in confined spaces safely.

We agree with Mr Yeo that in most workplace accidents, the learning points may not be new. But we can do more to reach out to every worker to ensure that they understand the workplace risks and the measures they can take to mitigate and remove such risks. We will ensure that our safety training framework is updated regularly to remain relevant to our workers. General WSH training is provided to all workers through one of the Employability Skills (ES) modules. For WSH professionals, we developed a competency framework under the Workforce Skills Qualification (WSQ) system in 2008, to equip them with the relevant technical competencies. We are

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expanding the competencies framework to provide workers in the construction and marine sectors with the technical skills to carry out specific tasks relevant to their industries safety.

Thirteen trade-specific WSQ courses had been developed for the marine sector. For the construction sector, we are developing six new courses. The courses on electrical works and plumbing and piping will be launched this year. Going forward, we will look into developing WSQ courses for other sectors. In the course of MOM's work, we have seen cases where stakeholders failed to engage their SME sub-contractors to ensure that work was carried out safely. We would like to stress that while work can be outsourced, the duties of the principals to ensure that work is done safely cannot be outsourced. Being the person who engages the contractor, the principal has the responsibility to hire the right sub-contractor for the job and ensure that they are able to carry out their work, not only competently but also safely. We will thus be amending the Workplace Safety and Health Act (WSHA) later this year, to ensure that principals remain accountable for the safety and health of the employees of the contractors and sub-contractors, whether or not they direct the work.

Sir, during the second reading of the WSH Bill in January 2006, then Minister for Manpower announced our intention to progressively extend the coverage of the Act to all workplaces by 2011, based, of course, on the philosophy that all workers have the right to a safe and healthy workplace. With effect from September 2011, the WSHA will be extended to all workplaces. An estimated 1.4 million workers across 16 industry sectors, accounting for close to half of the workforce will be brought under the ambit of the Act. Businesses can be assured that MOM will be working closely with the WSH Council to engage the stakeholders to educate them on their

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responsibilities under the WSHA and what they need to do to meet these obligations.

Mr Yeo would be pleased to know that we have set aside close to $70 million to help companies achieve the objectives of WSH 2018. The initiatives will cover four broad areas. First, the WSH 2018 Fund will be used to help companies develop the safety culture within their organisations. Second, we will use the Fund to help companies tackle safety challenges within their industries, by developing programmes that take into account their distinct WSH and operating landscape. The construction and marine sectoral plans are one example. Third, given the challenges SMEs face in managing WSH, we will also allocate funds to support SMEs in capability-building efforts. This will include educating SMEs that will be brought under the ambit of WSHA when it is extended to all workplaces in 2011. Last but not least, we will provide funding to establish new drivers to bring our WSH performance to the next level. This includes the WSH Institute, which will conduct research into emerging WSH issues and provide top-class WSH education to WSH practitioners, business leaders and executives. We will announce more details on the WSH 2018 Fund and its initiatives at a later date. As Mr Yeo had said, the collaboration of tripartite partners has been effective in bringing down our fatality rates over the years. MOM will continue to work with our tripartite partners on the various initiatives under the WSH 2018. I would like to thank Mr Yeo for his suggestions on the establishment of a tripartite resource centre. We will work with our tripartite partners to explore how we can improve stakeholders' access to WSH resources. We will keep this idea open. But I would like to draw Mr Yeo's attention to the fact that we already have the organisation and institutions to carry out the work.

Besides ensuring the safety of our workers, we will also focus our efforts on

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promoting progressive workplaces. Given our ageing workforce and declining birth rates, economically inactive residents constitute a sizeable pool that companies can tap on to meet their manpower needs. Mdm Halimah Yacob, Mr Wee Siew Kim and Assoc. Prof. Paulin Straughan asked about the training schemes for homemakers and recent retirees. To encourage economically inactive women to re-enter the workforce, the Workface Development Agency (WDA), supported by the Tripartite Workgroup on Enhancing Employment Choices for Women and the Community Development Centres (CDCs), rolled out the Step-Out For Change Programme in July 2008. This induction programme involves a series of workshops to help participants overcome their inertia or fear of entering or re-entering the workplace. Career consultants at the CDC Career Centres will advise the participants on training opportunities, based on their interests and skills development needs. Interested candidates will be enrolled for training offered by Continuing Education and Training (CET) Centres. They range from generic skills courses on literacy and numeracy to vocational skills training for entry into growth sectors. The CET Centres and CDC Career Centres will also refer the trainees to the network of hiring employers for job placements. In 2009, 520 women benefited from this programme, of which about 160 have been placed into jobs. Over the past three years, the Tripartite Work Group on Enhancing Employment Choices for Women, chaired by Mdm Halimah, has also successfully placed more than 5,600 women in jobs through job fairs, recruitment drives and job matching services. Flexibility is an important factor that economically inactive individuals look for when they transit back into the workplace.

1.15 pm

Mdm Halimah Yacob, Mr Wee Siew Kim, Ms Joscelin Yeo and Assoc. Prof.

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Paulin Straughan have also raised concerns about promoting flexible work arrangements and enabling employees to achieve work-life balance. MOM has put in place initiatives that promote flexible working arrangements. We have set up the Work Life Works! ("WOW!") Fund and "Flexi-Works!" to help employers kickstart

their implementation of flexible work arrangements such as part-time and other work-life initiatives. The "WoW! Fund" and the "Flexi-Works!" provide grants of up to $20,000 and $100,000 per company respectively. We are pleased to share that $10 million of the "WoW! Fund" has been disbursed as at January this year. In addition, more than 180 companies have come onboard the "Flexi-Works!" scheme and 1,900 workers have been recruited, as at February 2010, on flexible-work arrangements since the inception of the scheme. I have circulated a fact sheet on the "Flexi-Works!" scheme to Members.

Let me give Members an example. SingPost is a company that has successfully tapped on the "Flexi-Works!" to reduce its costs of recruitment, training and equipment purchase. SingPost provides its employees with various flexible work options. They include teleworking, part-time and job-sharing. These have benefited many of its female employees. In fact, most of SingPost's neighbourhood postmen are actually "post-women", as the job gives them the flexibility to collect mail from the mail transit room near their homes and deliver them in their neighbourhoods.

Given the encouraging results, we are pleased to announce that we will extend "Flexi-Works!" for another three years, from April 2010 to December 2012 at a cost of $10.5 million, and target to help another 4,500 individuals.

Employers in Singapore increasingly recognise the value of flexible work

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arrangements in attracting and retaining employees. Last year's Influenza A (H1N1) episode also encouraged many companies to implement tele-working. According to MOM's Conditions of Employment 2008 survey, 28% of private-sector employers in Singapore offered flexible work arrangements, such as part-time and telework, compared to 21% in 2002. Among private-sector employees, 7.4% opted for flexible work arrangements in 2008, compared with 3.8% in 2002. Many companies also provide informal arrangements for their employees to work flexibly.

MOM will continue to study the ways which flexi-work has been implemented successfully in other countries and apply the learning points to businesses in Singapore.

With the ultra high-speed national broadband network coming onboard in 2012, companies will find it increasingly viable to have their employees work from home. Employers should take the opportunity to redesign jobs to allow more jobs to be done from home – in other words, "homeshore" these jobs. Homeshoring allows workers to achieve greater work-life harmony and enables businesses to better manage their manpower resources and reduce overhead costs such as office rental.

The Tripartite Committee on Work-Life Strategy has formed a workgroup on homeshoring. The workgroup is chaired by Mrs Mildred Tan and comprises representatives from MOM, iDA, NTUC and SNEF. It will identify jobs that leverage on Singapore's increased infocomm capacity and recommend measures to encourage companies to "homeshore" these jobs.

Separately, Assoc. Prof. Paulin Straughan has suggested tracking paid and unpaid overtime work and studying

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work-life patterns in Singapore. The Ministry regularly collects data on hours worked and publishes them in the quarterly Labour Market Report and the annual Report on Labour Force in Singapore . In addition, data on work-week patterns are also publicly available in the biennial Conditions of Employment survey. However, we currently do not have statistics on unpaid overtime work as it would be difficult and onerous for employers to keep track of unpaid overtime hours.

Sir, on eldercare and childcare support. I would like to address the views of Assoc. Prof. Straughan who has suggested instituting eldercare leave and extending childcare leave to parents with children below 12 years old. The Government recognises the importance of providing eldercare and childcare support for families. However, enhancing statutory benefits affects business costs and must be carefully considered. Currently, our employees' leave entitlements are comparable to those in developed countries. Given that the Government had recently increased the leave entitlements for employees as part of the enhanced Marriage and Procreation Package in 2008, it would be untimely to impose additional requirements on businesses at this stage. Instead, we will continue to encourage companies to implement flexible work arrangements. Employers should work closely with their employees to work out appropriate work arrangements to achieve win-win outcomes. I am pleased to give some examples, as requested by Assoc. Prof. Straughan, of companies and organisations that have implemented flexible work arrangements for their employees. WDA, for example, gives eldercare leave of five days per parent or parent-in-law per year. The Health Promotion Board (HPB), under the Ministry of Health, gives two days of full-pay, unrecorded leave to attend to the medical visits of his or her aged parents or parents-in-law. The private sector, in IBM

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Singapore, the Work-Life Leave Programme is made available to employees where employees can take time away from work to meet personal needs. In social organisations like Yayasan MENDAKI, employees have this benefit – first day of school leave for parents who support their children on the first day of pre-school or primary school. These are some examples of flexible work arrangements which companies and organisations, including those in the public sector, have implemented for the benefit of their employees. We would like to encourage more companies to come onboard because by doing so they are able to take better care of workers and the workers will be more engaged and loyal.

The Civil Service places importance on promoting work-life harmony. Statutory boards, such as WDA, Health Sciences Authority (HSA) and HPB, have provided eldercare leave for its officers – as I have mentioned earlier as examples. We have also implemented various flexible work arrangements to cater to civil servants at different life-stages, such as telecommuting, flexi-time and part-time employment schemes.

Sir, Mr Yeo suggested that MOM take the lead to generate greater awareness and encourage employers to shift their current Group Hospitalisation and Surgical (H&S) company-based plans to the Shield-based Portable Medical Benefits Scheme (PMBS) for their employees. I would like to clarify that the CPF MediShield is already a portable scheme. It covers employees' inpatient medical expenses during their employment, while they are in between jobs and after retirement. About 93% of our resident working population between the ages of 21-65 is covered either by MediShield or a private integrated Shield plan. Hence, the vast majority of Singapore employees are able to meet their medical expenses when they change employers or when they retire.

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To ensure that employees have adequate Medisave savings to pay for Medishield premiums, the tripartite partners have been encouraging employers to enhance their employees' Medisave savings. Employers can make additional Medisave contributions in place of company-based medical benefits. In 2009, 302 private sector companies made additional contributions to their employees' Medisave accounts, totalling about $6.5 million. This decision is best left to the employers in consultation with unions and employees as they need to take into account their employees' needs and the companies' financial resources.

Next, on cultural diversity at work. Mrs Mildred Tan has made several suggestions on promoting social integration at the workplace. A National Integration Working Group for Workplaces (NIWG) was set up in April 2009 under the auspices of the National Integration Council. The NIWG is pursuing measures to help employers understand the benefits of an integrated workplace and build capabilities to manage diversity.

For instance, a tripartite conference will be held in April on fair and inclusive employment practices. The NIWG will also set up a database of best practices for managing workplace diversity and provide additional materials addressing common misconceptions about workplace harmony. This includes information on different cultural norms at the workplace.

NIWG's initiatives augment ongoing efforts by the Tripartite Alliance for Fair Employment Practices (TAFEP) to raise the capability of employers in responding effectively to the increasing diversity of Singapore's workforce. TAFEP's workshops, seminars and other educational materials are highly-subsidised and often free of charge. TAFEP also has a programme where employers appoint fair

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employment advocates who will help promote the adoption of fair and inclusive employment practices.

We agree with Mrs Tan that human resource (HR) practitioners and individual employees may need training on how to adapt to a diverse workplace. There are courses which are subsidised for Singaporeans and PRs. For example, HR practitioners may take the elective module titled, "Develop a strategy for managing diversity" in the WSQ Specialist Diploma in Human Capital Management. Employees may also enrol in the Employability Skills module on Learning and Personal Development offered by four CET centres. The module covers, among other areas, effective approaches to working within a diverse workforce and facilitating staff to work in a diverse team.

The Government and our tripartite partners will continue to facilitate greater harmony in workplaces through funding promotional efforts and training. We encourage employers to do their part and drive change within their organisations. With the strong support of the tripartite partners and other stakeholders, we can achieve our objective of bringing about a cohesive workforce and social integration.

Let me now turn to the issue of vulnerable workers. The number of casual and contract workers has been rising. By June last year, the number of resident employees on term contracts rose by 4.3% over the year to 197,200. This includes workers on fixed-term contracts and casual employment. Fifty-three percent of these workers have secondary or below qualifications and about 40% of them have a gross monthly income of less than $1,000. Many of them are employed in services, in occupations such as cleaners and security guards.

Mr Heng Chee How, Mr Zainudin Nordin, Mr Low Thia Khiang and Assoc.

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Prof. Paulin Tay Straughan have expressed concerns about the situation of part-time, casual and contract workers, especially the low-wage workers. MOM pays particular attention to this group of workers. The Tripartite Committee on CPF and Work Related Benefits for Low Wage Workers, which I chair, adopts a multi-pronged approach to raise their incomes, productivity, employability and employment standards.

First, we seek to improve the income security of low-wage workers. We do this through the Workfare Income Supplement (WIS), which encourages low-wage workers to work, helps supplement their incomes and builds up their Central Provident Fund (CPF) savings. As announced by the Minister for Manpower yesterday, we will further refine and strengthen WIS.

Second, we aim to ensure that there are sufficient opportunities for low-wage workers to upgrade to better, more productive jobs and remain employable. To encourage employers to send these workers for training, the Minister for Manpower announced that MOM is rolling out the Workfare Training Scheme in July 2010. The Minister has also explained how self-sponsored, self-employed and casual and contract workers can benefit from WTS.

Third, we aim to enhance the employment conditions of these workers by ensuring compliance with our employment laws and working with employers to improve working conditions, such as work patterns and wage levels.

1.30 pm

MOM has stepped up enforcement efforts against errant employers who do not provide employment terms and benefits to their workers according to the law. In 2009, MOM prosecuted 29

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employers for various Employment Act offences. The CPF Board also prosecuted a total of 312 errant employers for CPF-related offences. The number of Employment Act-related claims by contract and casual workers has remained low despite the economic downturn, accounting for about 2.1% of claims in 2009.

As Mr Heng has highlighted, MOM and the CPF Board also work closely with NTUC's Unit for Contract and Casual Workers, led by Mr Zainudin Nordin, to reach out to low-wage workers and inform them of their employment rights and avenues of recourse. We also reach out to service buyers, managing agents and employers to encourage them to adopt recommendations in the Tripartite Advisory for Responsible Outsourcing Practices. Between April 2009 and February 2010, MOM has conducted regular briefings or workshops for more than 100 employers, mainly from the cleaning, security and F&B sectors. We will continue to reach out to employers who engage these low-wage workers.

WDA and NTUC also launched the Best Sourcing Initiative (BSI) Early Adopters Scheme in July 2009. Workers will benefit when companies adopt the BSI and compete on quality instead of cost, as they will then look at improving workers' productivity by up-skilling, multi-skilling and re-skilling them. BSI therefore allows our workers, including the contract and casual workers, to be more productive through better job performance.

Lastly, MOM focuses on industries with sizable numbers of low-wage workers, such as the security and cleaning industries. For the security sector, MOM works with the Security Industry Regulatory Department (SIRD) and the Union of Security Employees to encourage security guard agencies to raise the basic salary and improve the employment terms of security officers.

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MOM also encourages the agencies to include employment and training-related criteria in SIRD's compulsory annual grading of security guard agencies. Similarly, for the cleaning sector, MOM and WDA are working with the National Environment Agency (NEA) to include employment and training-related considerations in the voluntary accreditation framework for the cleaning industry. This was announced by the Ministry of the Environment and Water Resources during this COS debate.

Our joint efforts have led to an improvement in the employment terms of these workers. For instance, the median gross monthly salary of security guards in full-time employment has increased from $1,278 to $1,379 from 2007 to 2008. The conditions and professionalism in the security and cleaning industries have also improved over the years. This was also alluded to by Minister Lim Swee Say and Mdm Halimah Yacob earlier in the Budget debate. We are also seeing companies improve their work conditions by adjusting their working arrangements, eg, shortening shifts from 12 hours to eight hours, to recruit and retain security personnel.

Mr Wee Siew Kim and Ms Denise Phua have asked about training programmes for the disabled. The courses provided by the CET centres and other WDA-approved Training Organisations are open to all individuals who are willing and able to undergo training, whether able-bodied or disabled. Our CET infrastructure does not exclude any group of people.

However, persons with disabilities (PWDs) have specific needs depending on the nature of their disability. We should tap on the expertise of the various voluntary welfare organisations (VWOs) to provide customised assistance for them. In fact, in my reply to a parliamentary

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question by Ms Denise Phua, I elaborated on this.

We need to develop the capabilities of our VWOs in assisting PWDs with their training and employment needs. We are prepared to do our part. WDA is working with the Ministry of Community Development, Youth and Sports (MCYS) and the National Council of Social Services (NCSS) to equip NCSS with sufficient knowledge and skills to develop an employment facilitation function for the disabled. VWOs can also leverage on the Advanced Certificate in Training and Assessment (ACTA) under the WSQ framework for essential skills and knowledge to design and deliver competency based training programmes and assessments for the disabled. Ultimately, helping PWDs requires efforts from all parties, including the Government, VWOs and employers.

I will now talk about the management and protection of foreign workers. Mdm Halimah Yacob and Mr Yeo Guat Kwang commented that errant employers of foreign workers must be held responsible for employment malpractices. Ms Jessica Tan asked about the measures to ensure foreign workers are properly managed by sub-contractors. As I mentioned earlier, MOM has stepped up enforcement of the Employment Act which requires employers, including subcontractors, to provide their workers with minimum employment standards, such as timely payment of salaries, overtime payment and rest days. In addition, all employers of foreign workers, including subcontractors, are subject to the work permit conditions under the Employment of Foreign Manpower Act (EFMA). For example, they are required to pay their foreign workers' salaries promptly, ensure their foreign workers have acceptable accommodation, and bear the costs of their medical treatment. Employers who fail to do so may be fined up to $5,000 or jailed up to six months, or both. They will also be barred from hiring foreign workers.

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Last year, the Ministry stepped up inspections to ensure compliance with the Employment of Foreign Manpower Act (EFMA) and took action against employers who did not comply. This stepped up enforcement accounts for Mr Chong's observation that the number of foreign worker and foreign domestic worker management problems per 1,000 foreign workers had increased in 2009.

To expedite the settlement of employment disputes, MOM also offers mediation services to help parties resolve their disputes as quickly and as amicably as possible, to reach a settlement that is reasonable and fair to all parties involved. If an agreement cannot be reached, workers may refer their claims to the Labour Court for adjudication. More than 90% of the cases involving foreign workers were heard and concluded within two months from the commencement of the first hearing.

We employ targeted measures to ensure the well-being of foreign domestic workers (FDWs). At last count, there were 196,000 FDWs in Singapore. That means about one in every five households in Singapore relies on a FDW to help out in the home.

We agree with Mr Sam Tan that more can be done to facilitate better matching between employers and FDWs. Among employers who engaged a new FDW last year, 28% of them terminated their employment contracts with their FDW within three months. It is likely that many of these terminations happened because employers thought the FDWs were not a good match for their family.

Most employers go through an employment agency to engage their FDWs, but in 2009, the employment agency accreditation bodies, the Association of Employment Agencies (Singapore) and CaseTrust, received 154 complaints

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against employment agencies for poor job matching or inaccurate bio-data.

The accreditation bodies have identified the uneven quality of bio-data used by employment agencies as one of the root causes of this problem. For example, the level of detail of bio-data varies across agencies, making it difficult for potential employers to compare FDWs' bio-data across agencies. The bio-data may not contain all the necessary information that employers need before deciding on the FDWs that they want. It is often unclear from the bio-data whether agencies have independently verified claims about the FDWs' skills and experience. They may have extensively interviewed the candidate, or merely relied on declarations from the home country agents. These problems lead to the employers hiring FDWs who do not meet the employers' expectations.

The accreditation bodies have therefore proposed to create a standard bio-data template for the industry. The standard template could help distinguish more responsible employment agencies by requiring agencies to indicate if and how they had attempted to verify the information provided. A standard template will also help employers compare bio-data received from different agencies, and ensure they have enough information to select the best FDW for their family. We support the accreditation bodies' efforts and will be working with them to develop this standardised bio-data template. We aim to have it ready by June this year.

Working and living in a foreign country as a domestic worker can be challenging for new FDWs who have to adapt to a vastly different environment and culture.

Mr Seng Han Tong asked if MOM has plans to help FDWs better manage their transition to working in Singapore. Currently, all first-time FDWs are required to attend a Safety Awareness Course,

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which provides them an introduction to working in Singapore households, with an emphasis on domestic safety and safe practices in high-rise residences. First-time employers are required to attend an Employer's Orientation Programme, which helps them understand what to expect from their new FDWs, given that their FDWs may be unfamiliar with Singapore and the demands of domestic work here.

To further help FDW employers ensure their FDWs are well-adjusted to working here, MOM will be engaging the Foreign Domestic Worker Association for Skills Training (FAST), to introduce a Settling-in Programme that includes lessons on Singapore's culture and norms, financial management and stress management.

These courses will be held on weekends at selected community centres, and will run from this May onwards. All FDW employers who are interested in signing up their FDWs for the courses may visit FAST's website at www.fast.org.sg from April onwards for more information.

Sir, at this point, may I seek your permission to take about one or two minutes more than the allocated time.

The Chairman: Yes, carry on.

Mr Hawazi Daipi: Mr Sam Tan commented on the change of employer policy for FDWs. Currently, FDWs are allowed to change employers with their employers' consent. In most cases where the FDW wishes to change employer, her current employer will consent, as it is in neither party's interest to carry on an employment relationship that has soured.

FDWs are also allowed to change employers if their employers have ill-treated them. To facilitate FDWs reporting employer malpractices, MOM operates a

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dedicated helpline for FDWs, informs FDWs of their rights and avenues for help during the Safety Awareness Course and conducts random interviews with first-time FDWs within the first few months of their arrival in Singapore. We currently do not see the need to relax the policy on changing employers.

Sir, in conclusion, our efforts to promote safe and progressive workplaces will enable us to maximise the potential of our workers. While we ensure that workers are provided with the basic standards of employment, such as safety and health, we must also put in place fair and progressive employment practices for all members of our workforce, from casual and contract workers to foreign workers. This will help nurture a competitive workforce and make Singapore a great work place to work for both foreign workers as well as locals.

1.45 pm

The Chairman: Any interventions? Mdm Halimah Yacob, Ms Josephine Teo, Assoc. Prof. Paulin Tay Straughan, Mr Yeo Guat Kwang and Mr Ang Mong Seng – in that order. Mdm Halimah Yacob.

Mdm Halimah Yacob: Sir, first, I would like to thank the Minister for a very comprehensive description yesterday of the $2.5 billion allocation to the CET. I think that is indeed very good for workers. It does show how we can help to improve productivity skills and income. I just want to seek clarification from the Minister on how does the new CET system provide a better link between training to career progression pathways. Sometimes, feedback from workers is that after they go for training, they come back, they do not see much improvements in their career prospects.

My second clarification is to ask the Minister how would small companies with tremendous manpower constraints be able

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to benefit under the new CET system, because it will be difficult for them even to send their workers during their working time even with the support from the CETs.

My last clarification is, I have heard Senior Parliamentary Secretary's explanation about ways to ensure better enforcement of labour laws. But I still have this concern about the higher foreign worker levy because unscrupulous employers can get round the whole higher levy and still employ foreign workers cheaply by cutting their pay, making them work longer hours or work on public holidays and rest days without over-time. Having a monitoring mechanism will be extremely difficult because there are so many foreign workers in Singapore. I would like to ask for clarification whether this will undermine our efforts to improve productivity, and what plans does MOM have to address this issue.

The Chairman: Can I appeal yet again to Members to make their interventions short, because we have got to finish by 2.25 pm and I have got a list of MPs who wish to speak here? Mr Gan.

The Minister for Manpower (Mr Gan Kim Yong): Sir, I will keep my reply short. Mdm Halimah Yacob asked about the link between training, career progression and career prospects. Sir, I would like to stress that this is precisely the reason why we have to ensure that our training is outcome-based. We want to encourage our workers to go for training that are relevant to their work outcome. Some of them may have unrealistic expectations. They may expect to be promoted immediately after training. But I would encourage them to be patient and work with us. In fact, today, we have set up a system where we help to profile the workers, understand their skills and career paths, and help them to design training programmes that would suit them and that would enhance their capability in

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their job. So the whole idea is, hopefully, we will be able to help them do their job better or help them to be able to take on better jobs. These are the outcomes that we want to put into our training programmes. It is also for that reason that we engage the industry players very closely so that in the process of developing these training programmes, we ensure that they remain relevant to the industry and the skills that we impart are valued by the employers.

On the second point which is also a related point, that is, how do we encourage smaller companies to also send their workers for training, given that they have very limited resources. First, I think I should stress that sending workers for training is the responsibility of the employers. The Government can help, support and provide the programmes and incentive schemes, like the Workfare Training Scheme (WTS) that we just announced yesterday. But, ultimately, employers must take responsibility for the outcome of raising productivity, by training their workers. Sir, I would encourage employers, big or small, to tap on our programmes, like the WTS that we recently announced. We will also find ways to customise our training programmes to suit different employer profiles. So, if you need the workers to work in the daytime, make time for them to go for training after work-hours. So for our training programmes, especially in our structured training programme, Workfare Skill-Up, we will customise our programme so that we can suit the different profiles of our employers' and employees' needs. We will also be talking about instituting training-in-place, at the worksite where they are working, so as to minimise disruption to work and reduce the time taken to travel from workplace to training place. We will try our best to make it as convenient as possible for both the workers as well as the employers. But, ultimately, workers and employers

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themselves must take responsibility of their training outcomes.

Sir, I will leave the third question to my Senior Parliamentary Secretary to answer.

Mr Hawazi Daipi: Sir, one of the concerns of employers is whether they can continue to employ the good foreign workers. Under the new levy system, they will be assisted to do just that, because if they upgrade the skills of their good foreign workers, they will be charged lower levy. This is one way to help raise productivity. So there is no conflict between productivity and higher levy.

My reply to Mr Chong earlier in my speech on enforcement indicates that it has worked. I would like to assure Mdm Halimah Yacob that we will continue to enhance our intelligence gathering capabilities, continue to conduct enforcement to ensure that we can detect errant employers and malpractices in various aspects that can help enhance the welfare and interest of our workers.

Mrs Josephine Teo (Bishan-Toa Payoh): Sir, I refer to the document that was distributed by the Minister yesterday on the changes to the foreign worker levy, and I refer to the Annex that shows us the levy rates for the construction sector. Although, in general, levies are supposed to go up over time, in the construction sector for the unskilled worker's levy, in fact, it appears to be a reduction. Currently, it is $470 for unskilled workers but come 1st July 2012, there is no unskilled worker levy but only a basic skilled worker levy, and that is actually $300 which is lower than what it is today. So I hope the Minister could share with us what exactly is going to be the difference between an unskilled construction worker whom we have in abundance today and what is so much of

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an improvement when we say that they are basic skilled. Is it realistic for us to be able to reduce or eliminate unskilled workers in construction? On a broader issue, I would like to ask the Minister how he thinks the whole process of skills definition and testing could be improved, so that we help the employers to accurately identify the proficient foreign workers. For example, is it possible to do the testing even before the foreign workers arrive in Singapore?

Mr Gan Kim Yong: Sir, with regard to the change in the construction foreign worker levy, I should explain that, currently, in the construction sector, there are not many unskilled workers, because most of them are required to have some basic skills before they are allowed to work on a worksite. In fact, we are going to remove the entire unskilled category, and therefore, we are going to eliminate the levy rate for unskilled workers. So the new term, "basic skilled" workers are the skilled workers today. In fact, the Ministry of National Development is going to create another category higher than "basic skilled", which requires even more skills and experience to qualify for the skilled levy. In other words, it is not a reduction in the levy but, in fact, it is an increase, because we should really compare the new "basic skilled" levy with the skilled levy today. So there is an increase. We want to encourage construction workers to continue to upgrade their skills and the sector as a whole, improve their productivity level.

The Member also asked about the definition of "skills" and how we can test them better. I think it is very difficult to have an academic definition of skills, because skills, as I have mentioned just now in my reply to Mdm Halimah Yacob, have got to be related to the work that they do. They must have an impact on the outcome of work performance and they will vary from sector to sector. The construction sector, for example, has its

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own set of criteria. The manufacturing sector also has its own set of criteria for skilled workers, in particular, for the foreign worker's definition. In the manufacturing sector, we require them to have at least a SPM qualification for those who come from traditional sources. For the others, we require them to have either a skills evaluation test certificate from ITE or an assessment certificate from WDA. So there is a criteria framework for skills definition for purposes of skilled levy. But having said that, these skills criteria will also change over time. Not only they are different from sector to sector, they also will change over time. As we move towards different business, we need to have different definitions. For example, recently, we introduced the English language proficiency requirement for certain services industries' foreign workers to qualify for skilled levy, particularly in hospitality. In the middle of last year, we also tightened the skills requirement for S Passes. So from time to time, we will need to continue to tighten these skills requirements.

As to the suggestion of testing foreign worker skills before they come to Singapore, the construction sector already does that. They have set up training centres as well as testing centres overseas. Because in the construction sector, the skills required are quite well-defined. So it is easier for them to do so. But for different business and industries, say, for example the services sector, because it is so diverse and it is very difficult for us to have a single point of training or certification. Workers also come from quite a variety of sources. So it is better to leave this for the employers to decide how best to do so. We provide some guidelines on the test and requirements for the test so that the employers, if they need, they can always set up some arrangements with the agents overseas to provide prior training or testing before they come. But the official testing should be done in

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Singapore so as to ensure the integrity of the test results. Sir, I hope that answers the Member's question.

Assoc. Prof. Paulin Tay Straughan: Sir, I have two clarifications for the Senior Parliamentary Secretary. His response was so refreshing. It is good to hear of these progressive employers who have augmented benefits for the employees. May I suggest that MOM gives these employers more presents and publicity, so that potential employees can seek them out and it will be a win-win situation for all of us?

My second clarification has to do with the FDW response. I am glad to note that we have good processes in place to protect the FDWs. That is a decent and right thing to do. My question is on the recourse that employers can take if they find themselves stuck with a poor fit but they face barriers for termination or transfer because the agencies are not willing to honour the contract. What can these employers do?

Mr Hawazi Daipi: Sir, it is a good suggestion to publicise companies that have employed good work-life and enlightened practices. Assoc. Prof. Straughan may know that MOM has given out awards to such employers annually. We will continue to give them some publicity to encourage others to come on-board.

On FDW employers, it is something that they have to work out with the employment agencies. If they have problems, they can refer their problems to the accreditation bodies. We will leave it to them to settle their problems.

Mr Yeo Guat Kwang (Aljunied): Sir, I am glad that the basic operational standards and the requirements established by the accreditation bodies for the employment agencies would now be made mandatory. I would like to ask the Minister of State

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specifically whether the standard contract, which is a compulsory requirement, between the employers and employees under this accreditation arrangement, will it also be made as a standard in this new regulation? Would he think that more than one rest day per month is considered as adequate rest for the FDW?

On the issue of Portable Medical Benefits Scheme, it has been NWC's recommendation every year. Sir, I am quite surprised to hear from the Senior Parliamentary Secretary that we best leave it to the employers. Although the basic MediShield is sufficient for employees who are entitled to B2 and below, but for those who are entitled to B1 and above, it is important for us to encourage the employers to shift from their current company-based Group Hospitalisation and Surgical scheme to an enhanced suite scheme.

Sir, I think it is something audacious that we can study. But MediShield is already portable, so it has benefited a large number of Singaporean workers.

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Ms Jessica Tan Soon Neo (East Coast): Thank you, Minister, for sharing the plans on the foreign workers and the various schemes. But I still struggle in terms of understanding how and what we will be going to be doing differently that will raise the quality of the foreign workforce that is coming in. I hear the point about the levy and that forcing some changes in behaviour and more thoughtful planning. But I am struggling to see the correlation in terms of how the quality of the foreign workforce will increase. The other thing that I do not think the Minister did answer is with regards to the cost. What will happen is there is no ability to hire locals to fill these jobs, with the higher levy, it might still translate to a higher cost for the consumers.

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Mr Gan Kim Yong: Sir, during the Budget debate, I spoke on how the proposed levy changes will bring about improvements in the productivity and the quality of foreign workers. I will just summarise the key points. The important thing to bear in mind is that ultimately, the improvement in productivity and quality of foreign workers will benefit the employers. Employers therefore, must take responsibility for the outcome of the quality of their workers. The Government can only facilitate. We will adjust the foreign worker levy so that there is greater incentive for employers to reduce their reliance on foreign workers. One way of reducing the reliance on foreign workers is to ensure that each foreign worker is able to contribute more, by bringing in better quality foreign workers. We cannot dictate whom they should recruit. We have put it into the system through the foreign worker levy, so that employers will be incentivised and motivated to look for the best quality of foreign workers that they can find to produce better results and create higher value-add.

At the same time, we also raised the skills requirements as Ms Josephine Teo asked just now. Over time, we will raise the skills requirements for foreign workers, so that employers will have to bring in better qualified workers to work in Singapore. We also have widened the levy differential between skilled workers and unskilled workers. By doing so, employers again will have the incentive to raise the quality of their foreign workers. Most of these criteria will affect employers' recruitment decisions to bring in better quality and more productive foreign workers. For foreign workers who are already here, we encourage employers to send them for training and upgrading. If they have been here for five to six years, as the economy and industry move, their skills may have to be upgraded to keep pace with economic progress. Therefore

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we encourage our employers to send their workers for training.

The foreign workers will not have access to course fee subsidies or absentee payroll, because training is the basic responsibility of the employers. However, the employers can also benefit from the Productivity and Innovation Credit announced by the Minister for Finance earlier. This applies to all training programmes, whether they are for local or foreign workers. It is important for us to send a message to employers that upgrading the quality of their workforce – local or foreign, is their responsibility.

The Ministry of Manpower's main programme, WTS, etc, will focus primarily on Singaporean workers. The infrastructure that we have put in place is also available for foreign workers who are here. Employers should take advantage of the schemes that we provide as well as leverage on the changes in the foreign worker levy to go for higher quality foreign workers as time goes on.

As to the second question which is what happens to the cost of companies as they face higher levy, if they cannot find local workers to replace these foreign workers. I also explained in my speech during the Budget debate that the primary objective of the foreign worker levy adjustment is to motivate employers to reduce dependence, not just simply replacing foreign workers with a local worker. If you replace one foreign worker with one local worker, with no change in skills or productivity, the output will be the same. There will be no improvement in productivity. Instead, we encourage employers to replace either a foreign worker with a higher skilled local worker or just simply reduce the reliance on foreign workers. If a company needs 10 foreign workers in the past, going forward, if they are able to change their way of operation and he needs only eight foreign workers, this will result in higher

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productivity. In fact with the improvement in productivity, together with the Government's schemes that we put in place, the cost of the foreign worker levy increase will be more than offset. The improvements in productivity will be long-lasting and it will improve the competitiveness of the company as a whole, not just the workers. We have to be very clear that the objective of this exercise is ultimately to raise productivity, not just replacement of workers. If we simply replace them without changing anything else, productivity will not improve.

Mr Ang Mong Seng (Hong Kah): ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Mr Chairman, the construction industry requires a lot of foreign workers, including both skilled and unskilled workers. However, the MOM has decided to reduce the number of unskilled workers. I understand that it is very difficult to get Singaporeans to work in the construction industry. If we do not have enough foreign workers, our construction projects will be delayed. Does it mean that we will have to wait longer for our HDB flats? In addition, the foreign worker levy would also increase the cost of construction projects and we all know that the property prices have already gone up. Will this increase in foreign worker levy cause inflation? Does the Minister have any plans to solve this problem?

Mr Gan Kim Yong: Mr Chairman, I will respond in Mandarin.

( In Mandarin ): [For vernacular speech, please refer to Appendix A.] I would like to thank Mr Ang Mong Seng for these questions. During the debate of Ministry of National Development’s Budget, the Minister has already mentioned how to improve the productivity in the construction industry. In the next few years, a substantial sum of money will be invested to improve the productivity in the

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construction industry. As I said earlier when answering Ms Jessica Tan’s question, the transformation of our construction industry does not mean 10 foreign workers will be replaced by 10 local workers. If that is the case, the process is not changed and there will be no increase in productivity. We have to find other ways, such as automation, mechanisation and the use of pre-fabrication technology, to increase the productivity. If we can do so, then we will not have to depend so much on foreign workers and there will still be savings and productivity enhancement even with the increased foreign worker levy. In addition, the Ministry of National Development has launched schemes to attract more Singaporeans to join the construction industry to do high value-added jobs such as supervisors or high skilled workers. Singaporeans should be able to undertake such jobs. The Ministry has a series of packages to attract Singaporeans into the industry.

Mr Heng Chee How: My question is on re-employment of older workers for the Minister.

As we talked about this subject in this House yesterday, the concern seemed to be that with the law coming in, employers may try to get rid of their older workers earlier so as not to have to meet up with the requirements under the law. If that happens, then the employment rate for workers, as they approach 60 or 62 years old, ie, those in their 50s, actually goes down, either through people being let off or being placed on contracts that are not renewed.

I would like to ask the Minister whether the Ministry would be monitoring this kind of statistics very carefully, and if necessary, to take stronger measures in these areas to ensure that the employment rate is sustained throughout

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the years that a worker approaches 62 and then to link up with the re-employment Act.

Secondly, I would like to ask the Minister whether he would agree that in many western countries and economies, as they see their workforce age and retire, far from wanting to get rid of their older workers now, they have a huge skill- and experience-shortage, which they feel deeply and are now figuring ways of how to get the older and retired workers back to work, and whether this is something that would also happen in Singapore, and which we should then emphasis to employers.

Mr Gan Kim Yong: Sir, the tripartite partners have been working very closely over the last two to three years in profiling our older workforce and presenting the values that older workers offer, including experience. In fact, many of the older workers are very patient and they become very good mentors to help the younger workers acquire skills and settle into their new jobs. Older workers have value and we are working together with the tripartite partners to promote them and to make employers more aware of the contributions of older workers.

I am quite encouraged by the employment statistics in 2009, despite the economic downturn. Employment rate of older workers, age 55 to 64 has remained at 57.4%. This is despite the fact that the overall employment rate has softened because of the recession. This goes to show that our employers actually do value older workers. I am encouraged and confident that when we introduce re-employment legislation, employers would continue to support this move. We will continue to monitor the employment rate of workers that are nearing age 62 when re-employment kicks in. In fact, we are monitoring employment rate of those who are 40 years old. If they are out of job between 40 and 50 years old, they would

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not be there by 50 years old and 62 years old. We are monitoring what we call, mature workers. They are not old yet, they are just mature and maturing. So we will monitor the employment rate to ensure that they stay employed. The real strategy is to ensure our economy continues to grow and there will continue to be new job opportunities created for both the old and the young. Otherwise, the companies will be facing tremendous pressure to keep their cost low to survive when the economy is not growing. So it is important for us to work together to ensure the economy grows strongly and jobs are created, both for the young as well as the old. We will ensure that we put in place measures to help older workers to remain employable and to continue to improve their employability so that they can remain productive.

The Chairman: Ms Denise Phua, last question.

Ms Denise Phua Lay Peng (Jalan Besar): Sir, I agree with the Minister's vision for the dual purpose of raising the foreign worker levy to reduce dependency on the foreign workers and to induce people to hire higher skilled foreign workers. But in workplaces such as the non-profit nursing homes and adult disability centres where some jobs are shunned by locals and unappealing, does the Minister have any ideas how productivity and innovation can be achieved to address this issue? Will the Minister consider granting any leniency to this group or at least look into this group of non-profit employers?

Mr Gan Kim Yong: Sir, as I mentioned in my speech yesterday, we will engage the various industries to explain to them the levy changes and to understand better what are their challenges. I will hesitate to make too many exceptions, because once it is considered that one particular sector has special requirements, I am sure that there will be many sectors that say that they are equally deserving of special

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consideration. It is probably better for us to maintain the foreign worker levy framework as a macro- and broad-based system that applies to all industries and sectors. We have differentiation between broad sectors – construction, marine process, manufacturing and services. But within those sectors, while each industry has its own peculiar requirements, it is better to leave it to the various industry champions. For example, for the tourism-related hospitality industries in need of special help and support, STB will be able to look at what other ways they can help them by giving them support incentives, grants as well as training programmes. Similiarly, construction sector has its own different requirements and the Ministry of National Development will also have programmes to help them. For the volunteering sector, for example, it would be better for the Ministry of Health for the health-related organisations, or MCYS to look at how they can more directly, help and support these organisations to achieve the Ministries' respective objectives. This is better managed that way.

2.15 pm

I understand that different industries, businesses or organisations will face different challenges. But it is better for the respective parent Ministry or host Ministry to look at these issues separately and see how best they can help these organisations cope with challenges, not just foreign worker levy, but many other challenges as we move ahead.

The Chairman: Mr Low Thia Khiang. Absolutely last clarification.

Mr Low Thia Khiang (Hougang): Thank you, Sir. In Mandarin.

( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Just now I heard the Minister clarifying Ms Jessica Tan and Mr Ang Mong Seng's questions

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on foreign worker levy. I was a bit puzzled. The Minister said that he wants companies to raise productivity of foreign workers and upgrade their technology to be productive. He said that replacing 10 foreign workers with 10 local workers is not increasing productivity. I thought that the main purpose of this productivity drive and raising foreign worker levy is to enhance the productivity of Singapore workers so they can earn more. Can the Minister clarify please?

Mr Gan Kim Yong: Sir, the point of productivity drive is to achieve sustainable inclusive growth, rather than expanding total labour force. We have to drive it through productivity improvement. Therefore it is important for us to raise the productivity of the entire economy. We have to mobilise the whole nation, everyone included.

We have to bear in mind that foreign workers today constitute about one-third of our overall labour force.

It is like a space shuttle. A space shuttle has three booster engines. If we switch off one engine and run only on two – ie, the local workforce of two million – I think the shuttle will be much slower. It may not be able to run properly and if it is not balanced, it may just run around in circles. I think it is important for us to bear in mind that we have three engines; that we must have all three engines firing so that the shuttle can go as fast as it can.

This one-third of foreign workers in Singapore must also continue to raise their productivity. Otherwise, we will see that the local workforce will raise the productivity, but one-third of the foreign labour force will remain where they are today. The economy will then be lopsided and we will not be able to realise the full potential of our productivity improvement.

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Therefore it is important for us to bear in mind that as we raise the productivity of local workers, we must also make sure our foreign workforce's quality and productivity will also be improved. If we are able to achieve this and the economy is growing strongly, the businesses are doing well, we have productivity growth, high value-added businesses, then we will have a lot more to share. Singaporeans – our own local workers – will then be able to benefit from this growth. If we slow down, the economy will slow down and there will be less to share.

To answer Mr Low's point on productivity growth, the ultimate objective is to benefit local workers – Singaporeans – so that they see improvement in their wages. That is stated in the ESC report and also repeated by Minister for Finance during his Budget speech. But in order for us to do so, we have to ensure that local workers' productivity will improve. At the same time, we cannot ignore the foreign workers. They must also improve in order for the whole economy to progress and achieve sustainable inclusive growth.

Mdm Halimah Yacob: Sir, the Manpower Minister has his work fully cut out. $2.5 million allocated for MOM's budget. This is a huge investment in our people but the rewards are clear. As skills go up and with productivity raised, our people can earn better wages. The devil, of course, lies in the details and the implementation. But with strong tripartism, I am sure we can move the agenda forward.

Let me take this opportunity, Sir, on behalf of the GPC and other MPs, to thank the Minister, Minister of State, and Senior Parliamentary Secretary for sharing with us their vision and their very comprehensive and patient responses; although I am still unhappy with including "OT" under the $1,700, a point which I will continue to raise.

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Our thanks also to MOM and their staff for their hard work last year, which was a very stressful year, and for working very closely with the tripartite partners to help support companies and workers.

On this note, Sir, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $956,344,200 for Head S ordered to stand part of the Main Estimates.

The sum of $46,024,700 for Head S ordered to stand part of the Development Estimates.