HEAD R - MINISTRY OF LAW

Head R – Ministry of Law (cont.)

Column: 3147

Resumption of Debate on Question [12th February, 2009],

"That the total sum to be allocated for Head R of the Estimates be reduced by $100." – [Dr Teo Ho Pin].

Question again proposed.

The Minister for Law (Mr K Shanmugam): Sir, I thank MPs who have spoken. I will respond to Members' comments on liberalisation of legal practice, legal education changes, admission to the Singapore Bar, solicitors holding clients' monies and whether voting is a right or privilege and whether it should be expressly mentioned under the Constitution.

Members have raised important points and I thank them. In the context of liberalisation and legal education, our aim is to make Singapore a legal hub. And we need a comprehensive policy and a regulatory framework for that. In that context, we will make the following significant moves.

First of all, in respect of creating a vibrant legal services sector. Last December, we granted Qualifying Foreign Law Practice (QFLP) licences to six foreign law firms. These six firms are top-notch and internationally renowned. They will complement and enhance the legal services provided in Singapore.

Second, we have also built upon our geographic advantages to become an arbitration venue of choice. By mid-2009, we will have Maxwell Chambers, a conservation building renovated to house a first-class venue for international arbitration hearings. It will have state-of-the-art facilities including verbatim recording, transcribing of witness testimony and instantaneous translations.

This is not an isolated effort. It is part of a series of concerted measures to build

Column: 3148

up our arbitration sector. For example, the American Arbitration Association entered into a joint venture with the Singapore International Arbitration Centre (SIAC) in 2006 to pursue regional opportunities. The Permanent Court of Arbitration is now in Singapore. The International Chamber of Commerce-International Court of Arbitration (ICC-ICA) will set up a regional office here in Singapore. SIAC and SIAC clauses are gaining ground internationally, and, in tandem with their profile, their outlook will have to become increasingly international.

Our status as a top-class arbitration centre is being recognised internationally. A 2007 report published by the ICC International Court of Arbitration ranked Singapore as the top city in Asia for ICC arbitration and one of the five most popular arbitration venues since 2000, alongside Paris, London, Geneva and Zurich. Our advantage is our connectivity and world-class infrastructure, our judicial philosophy in respect of arbitrations and being accessible at a much lower expense than some of the other popular arbitration centres. Internationally-renowned arbitrators have begun to base their regional arbitration practices in Singapore. Both local and international law firms in Singapore report brisk growth in their arbitration practices. These firms will benefit from our tax incentive for growth in these areas.

Thirdly, a comprehensive and holistic legal education framework is necessary because most essential for a vibrant legal sector are good quality lawyers. Therefore, ensuring that legal education and training is top-notch is extremely important. Let me start in that context with the admission criteria for the Singapore Bar.

Dr Teo Ho Pin and Mr Christopher de Souza spoke about the merits of removing the Diploma in Singapore law course (DipSing). Mr Hri Kumar spoke about the

Column: 3149

need to refine the rules on the admission to practise Singapore law. We welcome these suggestions.

We have reviewed the framework for admission to the Singapore Bar, with a view that the rules are relevant for our students who have studied overseas to return. And it is also to ensure that all those who wish to qualify for admission to the Singapore Bar receive a well-grounded professional training.

The first set of changes relates to the DipSing course. That course was intended to provide an avenue for graduates from Scheduled Universities to give them a good grounding in the laws and principles of the Singapore legal system.

But the one-year course has also proven to be a disincentive. Many, including Mr de Souza, have said that the course should be redesigned. We agree with some of the comments.

We will abolish the DipSing course. Instead, there will be an optional three-month conversion course culminating in Part A of the Bar Examination. I emphasise that it will be optional. If people feel that they can take the examination without going through the course, so be it. Students returning this year will no longer have to complete the year-long DipSing. The first conversion course and Part A examination will be held in the second half of this year.

Next, changes to the Practice Law Course (PLC). We will make some changes to the PLC. The general feedback has been that the current PLC should be enhanced to provide a more practical-based training which will better prepare graduates for legal practice. The PLC will be revamped and would culminate in Part B of the Bar Examination starting from 2010. The five-month revamped PLC will comprise more practical-based modules

Column: 3150

that will better prepare graduates for legal practice.

We will also replace pupillage with Training Contracts. The intent of this change is for law firms to devise more meaningful Training Contracts for their trainees. At present, a pupillage system is in place. But some pupils may have little direct contact with their pupil masters. The intention is to try and ensure that trainees have a constructive and structured learning programme and make the law firms take greater responsibility in this area.

For local graduates, duration of the Training Contract will remain at six months, as with pupillage. Foreign graduates who do Part A in 2009 and subsequent years, will do a total period of one year. For those who have worked abroad, up to six months of their training period abroad may be counted towards this one year period, provided such work experience or training is relevant. Details will be announced later. At least six months for such foreign graduates must be done after the Part B Bar Examination, and in a local firm.

The rationale for the recommendations for changes to DipSing, PLC and pupillage was to put in place more effective gatekeepers to uphold standards in the profession and prepare graduates for practice. This brings me to Mr De Souza's further point, that students with Second Lowers should also be allowed to try and qualify for the Bar without additional hurdles. With the introduction of the new Parts A and B of the Bar Examination and Training Contracts, we will allow students with Second Lowers to take those Examinations without any additional hurdles. They will be treated in the same way as other students. These new examinations should be sufficiently rigorous to ensure the required quality. And the market can be the test of professional ability. The Schedule for

Column: 3151

Universities will remain, and will serve as an additional safeguard. Changes will be made in time for the new Part A course later this year.

Practising lawyers ought to be updated regularly on changes to existing branches of law and be familiarised with new and emerging areas of law. Continuing Legal Education (CLE) has been made compulsory in a number of Commonwealth jurisdictions, namely, Australia, Hong Kong, England and Wales and New York State. Each of those jurisdictions has a fairly well-developed scheme in place, which we will study before introducing a local scheme. Stakeholders such as Law Society, Singapore Academy of Law (SAL), National University of Singapore (NUS) and Singapore Management University (SMU) will be consulted.

Last year, we introduced a special scheme to allow foreign lawyers who have worked for a local firm for one year practising offshore work, to practise Singapore law in prescribed areas such as banking, finance, corporate and other areas of legal or regional work after passing a qualifying examination. There was also an older scheme which allowed foreign lawyers in Joint Law Ventures (JLVs) to practise Singapore law in JLV areas.

In the coming year, we will review the several schemes with a view to refining the criteria, and streamlining the two examinations into a single "Corporate Practice Examination" (CPE), in order to enhance corporate practice in law firms in Singapore.

To ensure the continued adaptiveness of our legal education framework for legal practitioners in the longer term, we will need an umbrella body to co-ordinate, administer and have oversight of the

Column: 3152

various initiatives. We will set up a new body tentatively called the Institute of Legal Education (ILE). In the meanwhile, a Pro-Tem Committee will oversee the setting up of the ILE and transitional issues.

Dr Teo Ho Pin noted that the industry is facing a shortage of lawyers and called for action to increase the supply of lawyers. He said that Singapore has a lot of potential to develop into a legal education hub, and suggested that we consider expanding the capacities of our local law schools or provide more opportunities for established foreign law schools to offer law degree courses in Singapore.

Mr Chairman, law faculties have to decide on their optimal size. The NUS Law Faculty is of the view that it is already near its optimal size at around 250 students per cohort. SMU would like to keep its law school relatively small. The nature of the study of law is such that a lower ratio of tutors to students will make for a richer legal education. There is also a natural limit to the number of good law professors one can recruit, in a place like Singapore, even when we recruit from throughout the world. It is not a case where we can increase the size at will without compromising quality.

Dr Teo also mentions attrition amongst lawyers. This is a global phenomenon: that of lawyers not staying long in practice. It arises from the hard driving nature of the profession which leads to attrition, and the attractiveness of the degree which leads to lawyers moving on to jobs outside law. The law degree has become regarded as an excellent first degree for many other careers, especially where it is available – as it is in Singapore – as an undergraduate degree. To put this issue in perspective and in a complex and globalised economy like ours, it is not negative for those with benefit of legal training to move to other fields.

Column: 3153

Dr Teo and Mr Alvin Yeo also suggested that our local law degree courses be reviewed to be a three-year course. Our universities and MOE prefer a four-year LLB to ensure that graduates are adequately trained in law and in the process, receive a well-rounded, holistic education.

There is no international norm for a length of law degree. Dr Teo and Mr Yeo mentioned the three-year degree. That is the UK practice. As Mr Yeo recognises in the United States, law is a postgraduate degree. Typically a law graduate would have had six years' of university education. In Australia, some universities have three-year degrees. But others have moved to the Juris Doctor (JD) system, which will entail a postgraduate degree similar to the United States. In Singapore, there is a core of NUS graduates who believe that the four-year course has considerable value and merit. The Ministry of Education and NUS take that view as well.

The practical ability of young lawyers that Mr Yeo mentioned is likely to depend more on the type of training they receive in the law firms they join, rather than whether their law school course is a three or four-year course. We will, however, not rule out possible changes for the future. But, at present, we do not see a compelling need to change this aspect.

Dr Teo asked why we do not have foreign law schools set up here. We welcome schools which want to set up here or offer law courses here. New York University (NYU) has set up joint programmes with NUS, for example. If a high quality law school wishes to set up in Singapore on its own, it will be welcomed.

Now, let me deal with the issue of the supply of lawyers. Before the onset of the current economic downturn, we have

Column: 3154

seen an increase in the demand for lawyers. With the recession, the overall demand for lawyers might ease a little.

On the supply side, we would have increased the supply of lawyers through the SMU Law School as well as having increased the number of places at NUS. SMU Law School will be putting in place additional measures to further add to the pool of lawyers. The first batch of graduates from SMU will join the industry in 2011. That together with the increased intake for the NUS Law Faculty (from 220 to 250) will result in an almost 70% increase from 220 to 370 a year in the number of local law graduates in a couple of years' time.

Second, the incoming QFLPs may bring in more lawyers as they consolidate their regional offshore work here.

Third, the changes in our admissions policies should make it more attractive for overseas Singaporeans to return here to practise. This includes making it easier for Singaporeans and PRs with Second Lower degrees from overseas law schools to practise law in Singapore and the scrapping of the DipSing.

Further, our local law schools have expressed interest to start JD programmes. These will be postgraduate law degrees, modelled after the United States system, which will allow graduates from other disciplines and foreign civil law graduates to read law and qualify for our local Bar.

We will also review the existing special schemes that allow foreign lawyers to practise selected areas of Singapore law, refine the criteria and streamline the two examinations into a single Corporate Practice Examination, as I stated earlier.

Thus, we have put in place several measures. The increase in law school

Column: 3155

places alone will result in about a 70% increase, as I have said earlier. The other measures are likely to add to the supply. In the current uncertain economic climate, we should allow this pipeline of lawyers to come onstream before we decide on the need to make further radical changes.

12.15 pm

Dr Teo specifically asked whether we have plans to increase the pool of litigation lawyers in Singapore. Dr Teo's question about litigation lawyers is relevant to this issue. As supply increases, the supply of litigation lawyers may well increase. The current economic situation has also seen the growth in demand for litigation and dispute resolution work. Firms have reported that some of their younger corporate lawyers are venturing into litigation work. But we cannot dictate their choice of careers. These are general issues best left to the market.

Mr Yeo expressed concerns about what might happen to local law firms, once foreign law firms are allowed to practise, pursuant to QFLPs. He spoke about foreign law firms being able to cherry pick the best and brightest young lawyers from local law firms, legal service and the universities. He also spoke about possible impact on the judiciary if our brightest lawyers work for foreign law firms. He also suggested that that is the pool from which others like the Attorney-General and Minister for Law would be drawn upon.

These and more points were made quite forcefully to the Committee of which Mr Yeo was a member. After, I assume, considering all these points carefully, the Committee recommended quite clearly that we allow foreign firms to practise Singapore law. I have to assume

Column: 3156

that there were good reasons for those recommendations.

The Government largely accepted the proposals. And the Government’s main objective, as I have explained before, is to look at the interests of Singapore as a whole. We believe that liberalising will help the economy. Local firms will have to gear up and compete. There is no guarantee that there will be no impact. But the Government has to look at the larger national perspective. It will also be difficult to justify financial assistance targeted at local firms purely to preserve the profitable structure of those firms, as Mr Yeo suggested. His Committee made no such recommendations. There has to be a broader rationale for any financial assistance and if such rationale is offered, the matter can be looked at.

Next, let me deal with lawyers holding clients' monies. Dr Teo reminds us about his favourite topic – rogue lawyers who have disappeared together with large sums of their clients’ monies.

Let me recap what has been happening. In 2008, the Chief Justice appointed a Review Committee to look into making changes to the conveyancing system to prevent further misappropriation of clients’ monies by errant lawyers. That Committee recommended that lawyers be prohibited from receiving conveyancing monies.

The Government agrees with that in-principle. There is a strong public interest to protect clients’ monies in conveyancing transactions. A home is quite often the most substantial asset that anyone would purchase in his lifetime. We should not allow public confidence in the legal profession to be eroded by a few rogue lawyers.

I have appointed an Implementation Committee, which includes relevant stakeholders. Working in consultation

Column: 3157

with the key players in the conveyancing community, that Committee will be considering the viability of various options to develop and implement a workable solution. Further announcements will be made once the details have been worked out.

I would say this, at this juncture. The Review Committee’s recommendation has been greeted with dismay by some lawyers. On the other side, there are other lawyers, who have expressed relief. Many lawyers have borne the burden of stakeholding only because lawyers have traditionally been expected to hold monies as stakeholders as an ancillary service to their clients. They will now be freed to concentrate on their core work of providing legal services. This change is long overdue.

Mr Hri Kumar asked in the context of liberalisation, whether Singapore will ask for reciprocal rights. The QFLPs were issued in December and this request comes a little late, if I may say so. But in any event, the focus of the QFLPs and the whole approach was to focus on the benefits to the Singapore economy but if there are any specific suggestions that can be made that can help law firms in a way that helps our economy as a whole or national interest, we will certainly look at it.

Now let me turn to the hon. Nominated Member of Parliament's question on the right to vote. Prof. Thio raises the following questions: is voting a right or a privilege? What is the legal status of the right to vote? Should it be an express right? And does the case of Taw Cheng Kong cast any doubt on the position?

Let me deal with "Is it a right or a privilege?"

Representative Democracy is the very essence of our political system; and

Column: 3158

voting is the foundation of Representative Democracy.

The power of our citizens to vote cannot be a privilege, because that would imply that there is some institution superior to the body of citizens which is in a position to grant such a privilege to the citizens. But in a free country, there is no institution that can be in such a position to grant such a privilege to the citizens.

In a Representative Democracy like Singapore, voting is therefore a right, not a privilege.

Next, what is the nature of the right to vote? The right to vote is a constitutional right. It is an implied right, arising from the various provisions in the Constitution, including Articles 65 and 66 which provide for a general election within three months after every dissolution of Parliament. I have consulted the Attorney-General who agrees with me on this.

This is not a new point. As Prof. Thio has acknowledged, DPM Wong stated this in Parliament in 2001.

Third, is there a need to have an express provision in the Constitution on the right to vote?

As we have said, the right to vote enjoys the highest possible legal protection – it is a constitutional right. Is there a need to set it out expressly?

The Member knows the history of our Constitution. It is essentially a product of British drafting, based primarily on the Westminster model of Government with subsequent modifications as our society evolved. The Member will also know of the various approaches to the drafting of Constitutions in the Commonwealth in the 1950s and 1960s. There were countries which chose to draft their Constitutions in great detail, and others which only set out the basic philosophy.

Column: 3159

The last 50 years of post-colonialism has shown that in the end, regardless of all the high flown language in the Constitution, it is the mettle of the people and its leadership which will decide whether the Constitution becomes a living document or a near worthless piece of paper.

Prof. Thio referred to the 1966 Constitutional Commission which recommended that the right to vote be entrenched in the Constitution. The context in which those recommendations were made has to be understood, which she knows because she has written about it. At the time when the recommendation was made by the Committee in 1966, Singapore was barely one year old as a sovereign independent nation. Its citizens during the years before independence had been able to choose their own government at general elections held by a secret vote on only two occasions – once in 1959 and then in 1963. The Wee Commission therefore felt that Singaporeans have little experience of general elections and it could not be safely assumed that they have grown up to cherish choice expressed in periodic and general elections by universal and equal suffrage held by secret vote. For that reason, the Commission recommended that the right to vote be expressly stated in the Constitution.

We have had 10 general elections since then with about 95% turnout at each election. Every citizen reaffirms that Singapore is a democratic society every time he or she recites the pledge. There can be no concern that our citizens may not know the importance of voting or may not exercise it. The raison d'etre of the Wee Commission's recommendations no longer exists. And we have confirmed on the Attorney-General's advice that the right to vote is protected by the Constitution. The Member will note that

Column: 3160

the Articles I referred to – Articles 65 and 66 – from which the implied right to vote arises, are themselves intended to be further entrenched.

Sir, the Members spoke about the importance of entrenching the right as a symbol of Representative Democracy. As a simple proposition, that is questionable though I doubt the Member meant it in that sense.

A survey will show that Myanmar and North Korea are among the countries that have expressly set out in their Constitutions the right to vote, while neither Australia nor the US have made express provision for the right to vote in those terms. It will be difficult to suggest that the right to vote is less protected in the latter two countries. And of course the UK has no written Constitution. Philippines and Thailand also have Constitutions which set out democratic rights in greater detail than Singapore does. Again, we do not think that rights are less well-protected in Singapore as compared with those two countries.

Specifically as regards to voting, our policy has always been to ensure the maximum possible participation by our citizens in the electoral process. Thus, as stated earlier, we are among a handful of countries, including Australia and Belgium, which impose a legal requirement to vote. As a result, we have had among the highest voter turnouts in the world.

What is fundamental is a Government committed to the rule of law, an educated population aware of its rights and responsibilities and stable institutions which provide for a democratic politic. We believe that the right to vote to be a Constitutional right. We are one of the few post-colonial countries to hold regular elections. We have among the highest voter turnouts and we are increasingly building the necessary institutions. We have identified Articles 65 and 66 as

Column: 3161

among those to be entrenched. For a Constitutional lawyer, dare I say, the salad days are not the yonder years gone by.

Next, let me refer to Taw Cheng Kong. The Member also referred to the case of Taw Cheng Kong. Our general approach in this House is to avoid discussing specific Court decisions. Nevertheless, since the Member has raised the point by direct reference to the case, I will set out our view.

My officials have checked the Court records in Taw Cheng Kong. The legal nature of the citizens’ right to vote was not an issue in that case and was not specifically argued. The Member may well be aware of the substantial body of learning, confirmed by the Privy Council in Baker v The Queen [1975] AC 774 that in such situations, even if it was the ratio, the Court’s observations are not likely to be treated as precedent. In Taw's case, the observations were in fact obiter, as the Member acknowledges. The Member will also be aware that the decision in Taw Cheng Kong was overruled by the Court of Appeal albeit on another point. I should emphasise that in commenting on Taw Cheng Kong, I am not seeking in any way to traverse the jurisdiction of the Courts. I am merely giving the Government’s views on the case, in answer to Prof. Thio’s specific question.

Sir, in conclusion, there is in our view no doubt about the legal nature of the right to vote nor any dilution of the Government's commitment to the philosophies underlying that right.

The Senior Minister of State for Law (Assoc. Prof. Ho Peng Kee): I will go on first? Yes, we will take the cut altogether?

The Chairman: Yes.

Assoc. Prof. Ho Peng Kee: Sir, let me first address Ms Ellen Lee’s comments concerning community mediation.

Column: 3162

MinLaw has been actively promoting the use of community mediation through various measures. We have established an effective community mediation service, with a network of Community Mediation Centres (CMCs) and a strong pool of trained volunteer mediators, currently standing at 132. We have also strengthened our Magistrates’ referral framework and worked closely with key partners such as the police, HDB, the Courts, Grassroots Advisers and other key frontline agencies to ensure that appropriate cases are channelled to the CMC as early as possible. Sir, these efforts have yielded positive results. In the past three years, CMC handled yearly an average of about 550 to 650 mediation sessions with a 70% to 75% success rate, in other words, three out of four cases resulted in mediated agreements. For cases that were not successfully mediated, the opportunity that the parties had to hear each other out before a neutral third party would already have had a salutary effect.

As Ms Lee points out, currently, the three main challenges are firstly, getting the parties to come to the CMC; secondly, getting them to abide by the mediated settlements; and thirdly, the need for an avenue to obtain final adjudication when cases cannot be resolved through mediation.

Sir, we have been working on these issues. On the first, whilst not fully convinced that making mediation compulsory is the way to go, we have taken steps to nudge the parties towards mediating their dispute. The first step, taken about four years ago, was when we interposed Persuaders to seek out unwilling parties, to convince them to give mediation a try. Soon, we will take another step when we amend the Criminal Procedure Code (CPC). An amendment provides that Police will, in an appropriate

Column: 3163

case, refer the parties to mediate at the CMC. Then another amendment provides that where any party fails or refuses to go for mediation without reasonable cause and after such referral, should the case escalate to the Court thereafter, the Court may draw such inference from the refusal as it considers proper. In this way, parties who refuse to appear for mediation when the other party has requested for it following a Police referral will know that there may be consequences to their refusal.

On the second issue of enforcing the parties’ agreements, CMC’s role is to provide the parties with a neutral platform to jointly work out a mutually acceptable solution to their problem. It does not have an enforcement function. The settlements arrived at between the parties are binding on them essentially as private agreements, arrived at through negotiation and consent. As agreements, they are enforceable in a Civil Court in the event of a breach. It is not for the CMC to secure the enforcement of such private agreements on the parties' behalf.

Nevertheless, I appreciate the point that Ms Lee makes. Hence, the CMC has reviewed its template for settlement agreements, and will incorporate into them a dispute resolution clause that will route any disagreement concerning the mediated results back to the CMC for further mediation, if the parties agree. This will give the parties some assurance that after mediating the dispute, the CMC can still play a role to help them work out their differences.

I hope that these two enhancements will incentivise disputing parties to exhaust all mediation options before considering going to the Courts.

On the third issue of providing a forum for adjudication should mediation fail, the

Column: 3164

Neighourhood Court was established by the Subordinate Courts last year precisely to fulfil this role. This Court is presided by lay Justices of the Peace who are senior lawyers with experience in such matters. Five were appointed last year and have so far heard three cases. Thus, we do have in place a system to deal with these disputes.

In summary, Sir, we have fine-tuned the community mediation system as we worked it the past 10 years. We will continue to monitor these refinements, and make changes, as necessary, to ensure that they achieve their objectives.

Sir, I now turn to what Dr Teo and also Ms Lee have said about the need to provide Singaporeans with adequate access to justice and legal aid.

Two initiatives introduced in 2007 have helped to ensure that quality legal aid and advice remains accessible to Singaporeans, especially the financially less well-off. First, we raised the Legal Aid means test to cover the lower-middle income group. A family of four, ie, a working father with three dependants, now qualifies for legal aid if the household income is about $2,600 a month, compared to $1,900 before the amendment. This way, the Legal Aid Bureau (LAB) helped 960 more people in the first 10 months of this financial year, making up about 13% of the total who qualified for legal aid. Overall, 93% of the 8,200 cases registered this year qualified under the means test. Indeed, for family law matters which make up a high proportion of the cases LAB deals with, Tanjong Pagar FSC has a pro bono legal assistance scheme to help those who marginally fail the means test.

Another initiative was when MinLaw worked with the Law Society of Singapore and two CDCs to set up Community Legal Clinics (CLCs) in September 2007. In their first year, these

Column: 3165

clinics provided legal advice to some 2,400 persons. About 380 lawyers from 21 law firms, including six senior counsels, volunteered their time at these clinics which are run on average four nights a week. Nearly all who sought help received legal advice from the clinics within one to two weeks from the date they registered with the Law Society's Pro Bono Office.

Sir, our assessment is that there is currently no need to set up more legal clinics but we will monitor the situation and will certainly do so if the need arises. But besides these two MinLaw initiatives, there are adequate avenues for Singaporeans with a legal problem to seek redress. For example, they can seek redress personally, at MOM, for employment and workmen compensation matters or they can also tap the many mediation services covering diverse areas such as bank-related matters (FIDREC), which was in the news recently, or at the CMCs, which I have talked about, for disputes on the ground, as well as the Insurance Disputes Resolution Organisation (IDRO), should they have disputes on their insurance policies. In short, we have in place over the years put together a network where Singaporeans who need legal help can seek it.

Ms Lee raised a pertinent question about possible abuse by those who receive legal aid. I assure her that there are measures currently in place to prevent aided persons from abusing legal aid.

Firstly, as she knows, all applicants who pass the means test are subject to a merits test before aid can be granted. If applicants make unreasonable or unrealistic claims, or intend to prolong litigation to escalate costs for the opposing party, or refuse to take legal advice, legal aid can be refused or cancelled.

Secondly, LAB encourages all aided persons to litigate in a reasonable manner

Column: 3166

and to seek alternative dispute resolution mechanisms where available. For example, in divorce cases, mediation is routinely used by the Family Court to help parties narrow their differences and arrive at an amicable settlement of the issues. Aided persons can also be referred to the Give Another Lifeline (GAL) Programme, in which counsellors from the Tanjong Pagar Family Service Centre provide counselling services at LAB’s office. LAB continually monitors these cases to ensure that it is reasonable for legal aid to continue.

Thirdly – and this is in line with Ms Lee’s suggestion – LAB may also require an aided person, the one that she has described, to make a higher contribution towards his case, since one of the factors assessed is the amount of work done. The assigned lawyers may also claim a larger sum for the work done.

Furthermore, where it appears to the Court that an aided person has acted improperly in the conduct of any legal proceedings, the Court may order the aided person to pay party-to-party costs and also the costs of the Director of Legal Aid or the solicitor representing him. Ms Lee also asks if the means of aided persons can be regularly reviewed. While this is a reasonable suggestion, doing this for all cases as a matter of course will cause inconvenience to aid recipients in legitimate cases. I assure her that the initial means test conducted is rigorous. But let me also say that if LAB receives information, eg, from an opposing party, which shows that an applicant is above means, legal aid may be withdrawn. LAB is also considering imposing a legal duty on an applicant to inform the Bureau whenever there is a significant improvement to his financial position.

Lastly, as to the question of co-administrators – we agree with Ms Lee's suggestion – following a recent review, LAB has decided that the means of co-

Column: 3167

administrators need not be taken into consideration.

Mr Lim Biow Chuan shares his concern on the manpower situation in the Subordinate Courts including the Small Claims Tribunals (SCT). Indeed, as Mr Lim says, the SCT’s jurisdiction has been progressively enhanced. Although the total number of cases heard by it has declined, more of such cases are now more complex, requiring a longer time to resolve, for example, there were 1,100 cases involving short-term residential agreements last year compared to 400 two years ago in 2006.

The Subordinate Courts have assured me that they will monitor the caseload to see if more manpower is required to be allocated to the SCT. But I should clarify that MinLaw does not allocate resources to the Subordinate Courts, which budget is directly allocated by MOF. In any case, I understand that like the rest of the Civil Service, the Subordinate Courts hope to fill up its vacancies and recruit more staff in this economic downturn.

On average, the waiting time from the time of lodgment of claim to the first consultation before the Registrar is 10 working days. If the case is not resolved at the consultation, the waiting time to the hearing also averages 10 working days. These are acceptable timelines. I understand that the SCT will strive to maintain this timeline notwithstanding its enhanced jurisdiction.

The Subordinate Courts have put in place measures to improve productivity. These include expanding the use of alternative dispute resolution, as well as active case and process management. So, for example, during consultation sessions at the SCT, Assistant Registrars help the parties, who are usually not legally represented, to better understand

Column: 3168

the issues in dispute. And, in many of these cases, this has helped parties to resolve their differences amicably. Over the last eight years, the resolution rate is a high 87%.

Mr Lim observes that Deputy Registrars sometimes handle a large number of cases such as PTCs for cases proceeding for Assessment of Damages, more commonly known as AD-CDRs. He cited an example of a very long AD-CDR hearing list. The Subordinate Courts have clarified that the AD-CDR hearing list, which Mr Lim cited, for Monday, 9th February and Wednesday, 11th February, was actually 83 and 78 cases respectively, somewhat lower than the figure that Mr Lim cited.

My understanding is that multiple cases are usually fixed for these hearings as each application is not meant to take long. Nevertheless, the Subordinate Courts will monitor the number of cases for each list and, where necessary, increase the number of hearing sessions. More staggered times will be set for hearing lists with multiple cases. Lawyers with other commitments may request to be heard urgently, ahead of the queues. Consequently, even if there is a long list of matters, as far as possible, the aim is to try and make sure that lawyers are not kept waiting unduly long for a single matter to be mentioned.

Mr Lim will be pleased to know that to improve waiting times in relation to AD-CDRs, two refinements are being planned. First, effective next month, when renovation works at the Primary Dispute Resolution Centre (PDRC) are completed, AD-CDRs will be conducted at a Chamber there. This will improve efficiency by cutting down time for lawyers who have multiple cases at the Registry and the PDRC from having to move between both places. Secondly, the Subordinate Courts intend to introduce staggered timings for AD-CDRs, for example, two morning and

Column: 3169

two afternoon timings. They have further assured me that they will monitor waiting times more closely, taking feedback into consideration.

The Subordinate Courts recognise that just as judicial resources are precious, so is lawyers' time. Leveraging on the resources that it has, I understand that they will strive to increase productivity, reduce wastage of judicial time and reduce waiting times for the lawyers so as to serve the public better.

Now, the final cut by Ms Sylvia Lim who argues for more attention to be given to victims in our criminal justice system by introducing a victim personal statement (VPS).

Sir, whilst we have not enacted victim rights legislation and have not introduced victim personal statements, as have some countries, I assure Ms Sylvia Lim that our criminal justice process does take into account victims’ concerns. For example, early on in processing a case, Police informs the victim as to how the offence would be classified, as well as the name and contact of the Investigating Officer. This assures him that Police is looking into his case and that he can contact them if there is a need to do so. And then in the course of investigations, Police updates the victim further at key milestones such as when a suspect is arrested. One objective of a VPS is to render practical assistance to the victim to ask her or him whether she or he needs such help. Even without a VPS, victims in Singapore are not left to fend for themselves. For example, the Family Court provides a wide-ranging network of support to victims of family violence. Thus, in every personal protection order (PPO) application, a counsellor assesses the history of the case and the risk of family abuse of the victim and children. He will then advise her on the court procedures involved in applying for a PPO and, indeed, apprise her of safety measures

Column: 3170

that she should take. And in appropriate cases, the victim is referred for counselling at the Family Service Centre or Crisis Shelter. When a PPO is breached, Police cautions the accused against inflicting further violence against the victim before he is released on bail. In addition, Police makes an effort to let the victim or any social worker counselling her know when an accused is due for such release, advising her to contact the Police if there is a recurrence of violence against her. So these and other initiatives, such as the Vulnerable Witness Support Programme where volunteer support officers are assigned to provide support to victims, ensure that victims here are not alone in their hour of need.

On the bail process, victim concerns are considered in bail bond reviews. The recently established Bail Court adopts an individualised approach towards every bail application. In deciding on the bail application, the Court takes into account many factors, including the victim’s safety. Where a victim is in need of protection from physical violence or harassment by an offender who has been charged in Court, the Court may exercise its power to refuse bail. If bail is granted, the Judge can also impose conditions, for example, that the accused cannot approach or communicate with the victim while on bail, to lessen the risk of re-victimisation.Indeed, a breach of the condition may result in bail being revoked.

12.45 pm

On the use of a victim personal statement for sentencing purposes, our courts have actually used victim impact statements (VIS), because that is the other part of the VPS. The first part seeks to help the victim as regards the process and also any specific aid schemes that she may need; the second part is to record the trauma or feeling that she feels which can be produced before the Court for sentencing purposes. In appropriate

Column: 3171

cases, in Singapore, these VIS are submitted by the prosecution or called for by the Court to assist it in meting out a fair sentence. Indeed, in a recent case last year, where a VIS was tendered in Court involving a woman who was pushed onto the path of an oncoming train at a Mass Rapid Transit station by her boyfriend, the emotional trauma that she had suffered was captured and this was put before the Court for sentencing purposes.

But let me say this – a VIS is not required in every case because, in the majority of cases, the impact of the crime on the victim would generally be evident from the facts before the Court. In addition, any views or concerns of the victim which are relevant to sentencing are likely to be highlighted to the Court by the prosecution in submitting on the sentence. Another consideration is that the victim may not want to open herself up to the possibility of being cross-examined. We should leave the requirement for a VIS flexible as we do with the principles on which the Courts assess sentences. Be that as it may, my understanding is that the Courts will continue to call for victim impact statements in appropriate cases.

On the issue of accused compensating the victim, as Ms Lim knows, section 401 of the Criminal Procedure Code empowers the Court to order an accused person to pay compensation to the victim. There have been cases where the Court has made such orders, eg, in a recent case – I think sometime last year – involving the abuse of a foreign domestic worker.

As in the case of a victim impact statement, ordering compensation against the accused may not be appropriate in every case. Indeed, in some situations, this already occurs informally, for example, when an accused pays the

Column: 3172

medical fees incurred by the victim. On this, my understanding is that the Attorney-General’s Chambers will continue to identify appropriate deserving cases where compensation can be sought.

Sir, ultimately, as in other areas of criminal law and criminal justice system, the question is how to maintain the right balance. And here, even though Ms Lim has cited other jurisdictions – I think I have said this in the House before – Singapore has to find its own balance. On this area, in the various processes that we have talked about, it is how to recognise the victim's interest which, as I have illustrated Singapore does, but at the same time balancing it with the right of the accused and also the need to protect the wider community. So, we have to strike the right balance. Like I have reminded the House, even though we may not have specific legislation and there may not be a victim personal statement, the concerns of the victims are indeed taken care of throughout the entire process, from the time she reports to the time the case is heard before the Court.

Let me assure Ms Lim that, as she has passionately spoken about this, the victim's concerns are indeed something we look at quite closely in Singapore.

Dr Teo Ho Pin (Bukit Panjang): Sir, two clarifications. First, may I ask the Law Minister whether the law schools of NUS and SMU have reached the maximum capacities in terms of offering places for students? And will the Ministry of Law encourage NTU or SIM to set up law schools?

My second clarification is to the Senior Minister of State. I commend the Ministry of Law and the Law Society for providing the community legal clinics, but I think the clinics only provide legal advice, not legal services or representation. Is it possible that the clinics refer the cases to

Column: 3173

a panel of lawyers, say, small law firms which can provide more affordable legal services to their clients, especially the SMEs?

Mr Shanmugam: Sir, as regards Dr Teo's first question as to whether the NUS Law School and SMU have reached their maximum capacities, our understanding is that NUS certainly is operating at near what it considers its optimal capacity. And there is a difference between what is optimal and what is maximum. If you want people with degrees behind their names, we can produce more. But if we want them to be world-class and good, there is a certain optimal size, and NUS believes that about 250 students per cohort is about the optimal size. SMU has taken a slightly different model. It says it wants to keep it small and takes a different approach towards how they work with their students. Again, we respect that.

But the broader point or underlying framework for Dr Teo's question is – do we need more lawyers or more law students coming onstream? I think I have answered that in some detail. Given the current situation and the fact that by 2011, supply is actually going to increase by almost 70% as against the supply a couple of years ago, really, I think we should let that supply come onstream, bearing in mind that QFLPs are also coming on and they will bring in more lawyers. Let us see what happens in a couple of years and whether the supply situation continues to remain tight. I do not think it will be so in the context of these changes. But if it does remain tight, then we can consider further moves. I have flagged some further possible moves like coalescing the different ways in which one can practise various aspects of Singapore law and seeing what we can do there to allow more people to come and sit for those examinations and getting to qualify as lawyers, perhaps not practicising to the

Column: 3174

full extent of Singapore law but in many areas.

Dr Teo asks if we could encourage NTU to set up a law school. They have not made such a request. As a matter of Government policy – whether we should encourage it – I think it is already answered by the broader answers I have given earlier.

Assoc. Prof. Ho Peng Kee: On the community legal clinics (CLCs), the first point is that already the people who come are actually assisted. They do get advice, signposted on what they can do. Of course, Dr Teo makes a valid point. Thereafter, there may be some of them – not all – who may want to find a lawyer. As Dr Teo knows, lawyers will not be keen to put themselves forward to do that, I think, understandably, or even for friends of theirs. I think Dr Teo's point is signposting – to help the person who needs help to locate the right firm. I can ask CLC to consider this point. Indeed, there are about 600 small firms in Singapore with less than five lawyers. I am sure they will be quite prepared to help any of these persons who need help.

Prof. Thio Li-ann (Nominated Member): I thank the Law Minister for his very comprehensive and considered response and his emphatic clarification that the right to vote in Singapore, in fact, has a status of an implied constitutional right. I have a couple of questions and clarifications.

Given that we have now clearly affirmed the idea that there are implied rights in Singapore, I wonder, in the Minister's opinion, if he thinks this opens the door to further implied rights. I can think of a good example. He mentioned the Commission's Report – I am sure he is very well familiar with it – but one of the four rights which did not make its way to the Constitution was also the right to a judicial remedy. And I have argued, as

Column: 3175

the Minister well knows, that Article 93 might contain an implied right to a judicial remedy and that, I suppose, practice has confirmed it, judicial review and so on. I wonder whether he might give his opinion as to whether or not there is only one implied right or there is a possibility of further implied rights.

A clarification as well – I am in complete agreement with the fact that a beautiful bill of rights, a list of citizens' rights in itself cannot bring about good government, but I do not see having a good bill of rights as mutually exclusive with good government. In fact, I would like to see a discourse where we take a holistic approach where not only do we have good rights and institutions and procedures but good governance as well. So, do not misunderstand me.

Thirdly, I notice too that, as the Minister pointed out, and I actually have not thought about this, Articles 65 and 66 from which the implied right to vote is implied are going to be subject to Article 5(2A) procedure. Of course, that is a special entrenchment procedure which signifies the importance of parliamentary democracy in Singapore. I know I have asked Prof. Jayakumar this before, but I am wondering if the Minister could give some indication of a timeframe. There may be other considerations because Article 5(2A) is a pretty comprehensive clause. But I am sure citizens would like to know when representative democracy will be constitutionally entrenched. So I would appreciate it if he could give some kind of indication.

Fourthly, I am very well aware of the fact that we borrow our Constitution from the English, and we all know the English, they are very implied in how they respond. But we are not entirely English and the Minister is completely right, we are not in our salad days. We are

Column: 3176

Singaporeans, we have already moved past the first generation of leaders. And I know that while we have the fundamental superstructure of the Westminster constitution, we also have unique indigenous aspects to the Constitution which manifests certain degrees of legal autochthony. It is interesting that when you look at the Australian constitution, they imply in a right to free speech, because they do not have a bill of rights. And they said that this was necessary to realise representative democracy, whereas free speech in Singapore is protected under Article 14 of the Constitution.

The Chairman: Prof. Thio, we do not have very much time left.

Prof. Thio Li-ann: The question is this: there is a virtue in writing down rights. Though it is clear that the right to vote is a constitutional right, my suggestion was that if you write it into Part IV, you can get to the detail. Because what is protected is the right to vote, but not necessarily the content of the right to vote, for example, is it universal, is it equal, is it secret?

Last but not least, if you talk about the Constitution being a living document, it means that every generation has to appropriate it for itself. I am thinking of little kiddies in primary school. And if you want to educate them about our bill of rights, would it not be just more efficient and easier to have an express right to vote because you do not want 12-year-old kids to go into the intricacies of Westminster.

The Chairman: Mr Shanmugam, you have 7 minutes to reply to all that.

Mr Shanmugam: Let me try and answer them in sequence.

The first question Prof. Thio asked is: does the fact that I have confirmed on the Attorney-General's advice that there is the

Column: 3177

implied constitutional right to vote open the door to further implied rights? Prof. Thio specifically mentioned judicial remedy.

Sir, in these debates when a question like that is asked, we have to be very clear and careful and precise in our answers, because parliamentary records could be referred to in other places, including the Courts. While I have my own views about the matter, I think that is a question that should only be answered with the advice of the Attorney-General. Therefore, if Prof. Thio would file a Question, we will be prepared to consider it and get the necessary advice and response.

But as most lawyers know, when you take documents, when you have a contract, legislation or the Constitution, certain parts can be implied depending on the structure and the context of the various provisions. That is the way in which we have derived the fact that the right to vote is an implied constitutional right, and we are not alone in taking that view. Various respectable jurisdictions, ranging from Australia to Sri Lanka to Canada, have looked at their Constitutions, and Prof. Thio knows the approach to interpreting Constitutions, which is that you interpret them in a broad sense and therefore derive certain basic inalienable constitutional rights from the texture and context.

Second, Prof. Thio asked about a specific bill of rights. Yes, we are saying that the beautiful bill of rights does not guarantee. But is that an answer as to why we do not set it out? I did spend a considerable number of minutes in my original speech explaining, first, the context in which we say it is a constitutional right – a clear categorical unqualified confirmation in Parliament by the Government twice, first by Deputy Prime Minister Wong and now by me, both times on the advice of the Attorney-

Column: 3178

General – and pointing out that we are not unique in that respect. There are other countries which have not expressly set out these rights. We stand in the category of countries together with Australia, the United States and the United Kingdom, and it has not hampered us in any way.

And I spent some time explaining that our philosophy is, in fact, that we want everyone to vote, which is why we have a law which requires people to vote. The proof is in what has actually happened on the ground. Over ten general elections since 1968, we have had an average participation of 95% of the people voting. So really, when we talk about Representative Democracy, you look at what happens actually. Is there a right to vote? Do people exercise it? Ultimately, the guarantee, Prof. Thio, for all of these rights is the kind of institutions you have and the kind of people you have. They get the Government they deserve.

1.00 pm

Thirdly, Prof. Thio asked about Articles 65 and 66, and when it is intended to be entrenched. Now, this question has been asked a number of times and the answer has been given a number of times. Last October, the Prime Minister explained in Parliament that the Government's intention was to first, operate the revised spending rules and if after five years, no further major changes are necessary, the Government will consider entrenching the provisions concerning the Presidential Custodial Powers. And all of these are together, the parts that are to be entrenched. This is to make sure our Constitution does not become a worthless piece of paper, and to make sure that it is a living document, is to also ensure that as we develop and as our institutions develop, and for example, the Elected Presidency develops and the Elected President's powers are more and more clarified, it is important

Column: 3179

that we know how to work the system and that the system works for us. As Parliament looks at it, as the electorate looks at it, once a system starts working well and time has gone and there is a certain degree of comfort and we acknowledge that it is practicable and workable, then it is possible to further entrench it. That has been the thread of the answers that have been given in Parliament so far.

Finally, I think Prof. Thio said entrenching the voting right and clarifying the Constitution will make it clear who is entitled to vote, that it is sacred and that it is universal. The principles clarifying the way in which the right to vote is exercised – and we must distinguish between the right to vote and some document that gives effect to how that right is to be exercised – that is already set out in the Parliamentary Elections Act. It sets out the qualifications, the disqualifications and how one exercises one's right to vote. The Government has, over the years, gone further and further in facilitating this right to vote by bringing the voting nearer to the people by even breaking it down into precincts, as Members have acknowledged before.

The Chairman: I do not think we have any time left. Dr Teo.

Dr Teo Ho Pin: Sir, I would like to thank the Law Minister for his inaugural replies to all the Members' cuts and also his positive responses to some of the suggestions by the Members. I would also like to thank the Senior Minister of State for his comprehensive replies. Sir, I beg leave to withdraw my amendments.

Amendment, by leave, withdrawn.

That the sum of $160,320,000 for Head R ordered to stand part of the Main Estimates.

Column: 3180

That the sum of $171,635,000 for Head R ordered to stand part of the Development Estimates.

Column: 3180

Head S – Ministry of Manpower

The Chairman: Head S – Ministry of Manpower. Dr Ahmad Magad.

Saving Jobs

Dr Ahmad Mohd Magad (Pasir Ris-Punggol): Mr Chairman, Sir, I beg to move,

That the total sum to be allocated for Head S of the Estimates be reduced by $100.

Like many others in the world, Singaporeans are watching the alarming rate of decline in the world's economy with anxiety. Many workers and companies are feeling the heat of massive retrenchments that are occurring globally. In Singapore, the Government has announced several meaningful schemes to mitigate the impact of the downturn. However, as Singapore is an open economy, these measures unfortunately cannot represent the magic pill to cure us from the full effects of the economic crisis.

Sir, I see two important aspects of addressing the needs of workers in the downturn – saving jobs and creating jobs. The Government, in this Budget, has taken the supply-side approach through the Jobs Credit Scheme with the intent of saving some jobs. Saving jobs is important, Sir, because in a downturn, retrenchment is the easiest and quickest approach to bring down cost. However, as it is a supply-side scheme, it does not quite address the problems of falling demand and falling demand can still lead to retrenchments, albeit at a later stage, even with the Jobs Credit Scheme.

The Jobs Credit Scheme, as it is, seeks to adopt a one-size-fits-all approach, as it provides a 12% subsidy to

Column: 3181

all companies with Singaporean workers, up to a cap of $2,500. I would like to suggest that this be tweaked for a two-tier system to be considered. This is because SMEs and companies with more expensive knowledge and skills intensive employees may not find the Jobs Credit Scheme adequate to stave off retrenchments. Therefore, I would suggest adding a second-tier for SMEs and companies with a higher percentage of knowledge workers due to the nature of their industries. In addition to receiving the subsidies offered to all companies, such companies could be given an additional subsidy of a lower quantum of 6% for the income portion between $2,501 and $4,000. This may help save the jobs of many Singaporean PMETs, many of whom are breadwinners in their families. I am concerned, Sir, that this group is particularly vulnerable in this likely long recession and I think it is important that the Government intervenes to do something specific for this group sooner rather than later before many more lose their jobs.

While it may be difficult to create new job opportunities in a recession, Sir, I believe re-channelling of certain jobs is possible. Currently, there are many semi-skilled service jobs which are conducted by foreigners such as sales assistants, waiters and waitresses, and even food stall assistants. In a downturn, Sir, semi-skilled or lower-skilled Singaporeans who are out of a job may have to turn to such jobs if they cannot find something in their previous line of work. In line with this, Sir, I would like to ask what is Ministry of Manpower's (MOM's) policy with respect to the issuance of R passes to low and semi-skilled foreign workers, and whether this will be tightened in the light of increased unemployment so that vacancies in such jobs can go to Singaporeans?

I would also like to ask the Minister about the number of P, Q and S pass

Column: 3182

workers, who have had to give up their passes since the start of the economic downturn. While I am not for protectionist measures, which will require that jobs in Singapore be saved only for Singaporeans, I would like to know if the Ministry plans to tighten the requirements for pass applicants, so that some middle and high-skilled jobs can go to retrenched Singaporeans in the PMET category.

Mr Chairman, I would like to also ask what avenues are there for the lowly-educated and lowly-skilled workers who are retrenched to benefit from Skills Programme for Upgrading and Resilience (SPUR). Many SPUR programmes require people to have either GCE 'N' or 'O' Level qualification or a minimum Level 4 pass in the WDA's qualification criteria. I hope the Minister will address my concern in this matter as well.

Employment

Dr Lily Neo (Jalan Besar): Mr Chairman, Sir, making our workforce more productive is a vital component to our economic recovery. Therefore, equipping our people with better skills is a good objective, but more importantly, it is necessary to equip them with new and relevant skills with which to compete in a global labour marketplace.

May I ask the Minister whether there has been a follow-up on the outcome of the many skills upgrading funding and programmes over the years? Was there a KPI set out for such funding? Did the upgrading of skills improve the job prospects and livelihood of the participants over a period?

Presently there is a unique window of opportunity to achieve more equitable wealth distribution. Will MOM consider looking into the setting up of a central management system targeted at our low and middle-income groups with a long-term view? The emphasis will be on

Column: 3183

tailored improved capabilities for individuals that are relevant to market standing and matching them with favoured industries of today and possibly of tomorrow. These would ensure better flexibility and use of human resources. Will MOM focus on educational investments, and promote technological skills qualifications for this group, with or without job placement? Will MOM facilitate hands-on approach in developing each individual with follow-up to achieve effective and sustainable skills? This will better prepare these groups to emerge on a more equitable standing at the next upturn.

Skills Programme for Upgrading and Resilience (SPUR)

Mr Low Thia Khiang (Hougang): Sir, the SPUR programme costing $600 million, aims to provide workers the opportunities and resources to upgrade their skills and employability. It also gives an allowance to jobless Singaporeans who attend courses – combining training with benefits. I understand that for those who are unemployed, there is currently no disclosure of eligibility criteria but will be assessed on a case-by-case basis. The reason given was that it might discourage some from coming forward or encourage others to abuse the system.

With training places under SPUR doubling from 110,000 in 2008 to 220,000 in 2009, I would like to know, one, what does the Government base the formulation of SPUR on? How does MOM decide what training courses and skills to support? Two, how do we measure its effectiveness? Three, would there be some performance indicators to evaluate the impact of training on the economy and the workers? For example, how many found new jobs as a result of retraining? How many were re-employed

Column: 3184

with larger work scopes? What is the average wage for those who have undergone retraining? Four, would it be more efficient to have some form of allowance eligibility criteria for the unemployed, versus the current approach of using case-by-case assessment?

Sir, the subsidy rate for PMET courses under SPUR will be increased to 90% and will include all specialists and advanced diplomas offered by our polytechnics. Again, the question is how do we measure its effectiveness? A considerable sum of money was allocated to SPUR. It is important that SPUR focuses on the employability of the trainees, with new jobs created and with a long-term view to cater to the future manpower needs of Singapore as well as to prevent wastage of resources.

Employer-based Funding – Absentee Payroll

The Senior Parliamentary Secretary to the Minister for Community Development, Youth and Sports (Mr Teo Ser Luck): Sir, I met a resident who is a PMET and is worried about the future of his job. He currently still has a job but his company is downsizing. So his wife, who has been a homemaker, is also getting ready to go back into the workforce. Both felt that there will be little chance of success for them to look for a job if he is retrenched, especially when they are above 40. I am beginning to see more of such cases. These PMETs are going to face challenges because they are more than half of our workforce and retrenchments have actually doubled. So with fewer job vacancies available, they will have to compete for positions that need lower qualifications and lower pay. The higher cost they are, the higher chance they will be retrenched and the harder they will fall. We have to help them. Let us do what we can for these local PMETs because in this downtime, we should encourage the employers to send them, especially those

Column: 3185

above 40, for training or courses when they are still with the companies.

We must also make the companies feel it is worth sending them too, so we have to incentivise the employers. Currently, I understand that the absentee payroll scheme does not include those above 40 years of age with higher than "A" Levels qualifications. Could the Ministry consider including them, if not, why not? Some companies have also feedback that they are unwilling to send their workers for training after office hours because they have to pay for the training as well as the salary. And they felt that that does not incentivise them and they have asked if the Ministry will consider providing direct grants instead of just co-sharing for courses or for the salary taken after office hours.

Training for PMETs

Dr Lim Wee Kiak (Sembawang): Sir, as reported in an excellent article in the Straits Times today talking about PMETs, written by Mr Aaron Low, PMETs form 51% of our workforce and it is the backbone of our economy. According to an employment report published by MOM in third quarter 2008, among the resident retrenched workers, the PMETs constitute 43.3%. I would like to ask the Minister what is the current unemployment rates of PMETs among the resident population? And what is the Ministry's worst-case scenario prediction of unemployment rates for this group in 2009?

MOM launched the Professional Conversion Programme (PCP) on 27th March 2007 and was scheduled to run for two years. The PCP for each industry is offered by different schools and each differs in the duration, cost fees and allowances. The duration of the course ranges from six months to 36 months and course fees can be quite substantial for longer courses such as occupational therapy and physiotherapy courses. I would like to ask the Minister for an

Column: 3186

update for PCP – how effective is the PCP so far? And how many PMETs were successfully converted and found a new career after their training?

The PMETs that I have met at my Meet-the-People Sessions and block visits were generally in their late 30s and early 40s. Many are married with young, school-going children.They do have many household bills to pay including their mortgage loans, utilities bills and conservancy charges. I met one of them recently and he was thinking of doing a course on physiotherapy. The duration of the course is three years. The course fees before subsidy is above $6,000 and a stipend of $900 per month will be paid during the three-year course per month. It will be difficult for him and his family of four to depend on the stipend of $900 per month for the next three years just to survive. I hope the Ministry will look into enhancing the PCP schemes, so that they can better support the PMETs and their families while they are in training.

1.15 pm

I am glad that the Government has announced the increase of course fee subsidy from 80% to 90% for the Diploma and Degree holders. Many do not have much reserves to fall back on, especially in tough times like these. So even the 10% course fee which may run into hundreds is prohibitive. I hope that the Government will consider allowing CPF to be used for the course fees for those who are retrenched. I also understand that PCPs will be expanded to include more sectors of the economy. While it is good to teach our PMETs how to fish and also to improve their fishing skills, the main concern on the ground is the depletion of fishes in our pond. Even with skills, some have lamented that there are no jobs available. Can the Minister enlighten us on how many PMET jobs opening is expected to be created in the next six to 12 months? What is the

Column: 3187

Ministry doing to help our PMETs in securing jobs?

There are also fears that fishermen from overseas with similar skills may come to our waters to fish as well. Will the Ministry be issuing less employment passes for these overseas fishermen so as to ease the excesses in supply? How many 'S' passes did MOM issue last year and how many more will be renewed or issued this year? Apart from the Jobs Credit Scheme which favours Singaporeans, what is MOM doing to help our resident population in securing jobs?

The Chairman: Mdm Ho Geok Choo is not here. Mrs Teo.

Jobs for Singaporeans

Mrs Josephine Teo (Bishan-Toa Payoh): First, I would like to thank the Ministry for its timely introduction of the SPUR programme in December 2008. Since SPUR was launched, WDA has responded quickly to feedback and fine-tuned the programme. It has also intensified efforts to promote awareness of SPUR. As a result, our unions have meaningful ways of engaging companies. On behalf my union and the workers we represent, I thank MOM and WDA for their good work.

Sir, as the job market contracts, there is increased anxiety on the availability of jobs. Besides workers who lose their jobs, new job entrants to the jobs market are also concerned about their employment prospects. I was, therefore, very heartened when I met a final year student from NTU two weeks ago, who told me he had not only secured a job with a multi-national corporation, his starting pay was well above $3,000. While he acknowledged that he was lucky, his is not an isolated success story.

Column: 3188

For example, 11 or about one-quarter of the Government workers from my union found jobs while they were still attending the Employability Plus Training Camp at e2i, just about two weeks after they were retrenched. In other words, the jobs market is down but not out.

Several economic agencies have launched initiatives to help companies and businesses weather the downturn. Some of these initiatives can benefit graduating students in the form training and attachment opportunities. For example, A*STAR's Graduate Attachment Programme provides valuable research training and experience to recent graduates who are interested in R&D, but who cannot secure such jobs now because companies are trimming research headcounts. These are very good initiatives. However, job-seekers including graduating students do not seem to be familiar with them. There should be a more coordinated effort to promote awareness of such opportunities to graduating students and recent graduates. May I suggest that the MOM looks into it? May I also suggest that MOM consolidates information on all hiring positions, ie, something like a jobs counter to make it available and present a holistic picture to the public regularly, at least for this year. This will complement the decentralised information dissemination by e2i, the CDCs and the self-help groups that are already in place and serve to reassure Singaporeans that jobs are still available despite the downturn.

At the same time, there is concern about the large number of foreign-sourced manpower in Singapore. This subject crops up often during face-to-face dialogue sessions and e-Townhall web-chats. This is understandable. It was reported in Parliament in 1994 that there were 200,000 foreign workers in the 1.6 million workforce then, ie, one in eight employees in 1994 was non-Singaporeans. In 2008, non-Singaporeans

Column: 3189

comprise roughly one in three of our workforce.

Sir, allowing businesses to have access to foreign-sourced manpower has enabled the Singapore economy to grow beyond our natural limits. Singaporeans too have benefited from the growth. From 2005 to mid-2008, before the sharp economic downturn, the job market was tight. Because of this, companies competing to attract and retain talents improved on their salary offers and other benefits. Many Singaporeans saw steady wage increases.

Nevertheless, since the objective of foreign-manpower policies is to augment Singapore's workforce, is the current level of dependence on foreign-sourced manpower sustainable or desirable? How has the number of foreign-sourced manpower shrunk since the downturn? For companies, besides relieving their manpower crunch, foreign-sourced manpower helps to smooth out their employment costs in Singapore. However, beyond the factory floors, what the employer may not see is the social cost of a large foreign workforce. Foreign workers who have few other recreation options congregate in open public spaces. Though it may not be intentional, some end up littering. Our enlarged population also puts a strain on public resources, such as transport. We have to make extraordinary efforts to house foreign workers.

Until the downturn, it was also worrying that many companies tended to be unconcerned about skills upgrading and productivity improvements. It was simply faster and easier to apply for foreign workers. This unhealthy attitude erodes our long-term efforts to raise productivity gains. Has the Ministry conducted detailed studies on which sectors have over-depended on low-wage, low-skilled foreign workers? Should such sectors be expected to raise their productivity before being allowed to import more foreign-

Column: 3190

workers in future? How else can we raise productivity in such sectors to give local workers a chance to improve their wages?

All things considered, foreign-workers may be low-cost to companies. But we must be careful to make sure that they do not become high-cost to society. While our efforts are now focused on upturning the downturn, I hope the MOM can consider these views in refining our foreign-manpower policy, both in the short term and long term.

The Chairman: Mr Heng Chee How. You have two cuts. 5 minutes in total, please.

Job Sourcing and Reporting

The Minister of State, Prime Minister's Office (Mr Heng Chee How): Sir, the first cut is on jobs sourcing and reporting. This economic crisis may be prolonged and from the look of it, it is most likely that it will be prolonged. With the timing of the upturn most uncertain, we must expect retrenchments and unemployment to rise during the course of this year.

To keep the rate of deterioration to as low as possible, it is crucial not only to cut costs but also to help as many displaced workers as possible find new jobs as soon as possible. These workers come from all levels and from many industries. To place people into new jobs, we must have the jobs. This in turn means that we must know of the existence of the jobs so that they can be put into the job banks. In a downturn, knowing every vacancy truly counts. I would like to ask the Ministry whether, in its view, the current system of collating specific job vacancies across different industries in the public as well as in the private sector is good enough, so as to enable as many jobseekers as possible to be retrained and matched into these jobs. I would like to ask the Ministry whether the efficiency of such switching and

Column: 3191

clearance mechanisms – as it is crucial to help avoid a fast build-up of a pool of the unemployed – is good enough and what more can be done to improve the sourcing of jobs throughout the economy and to also improve the efficiency of matching.

Balancing Foreign and Local Employment

My second cut is on balancing foreign and local employment. Sir, Singaporeans view foreign employment as complementary or supplementary to local employment. Foreign employees of all levels are here because of work that locals cannot do, will not do, or do not have enough people to fill the vacancies.

In an economic downturn, job vacancies will shrink. Tough choices would have to be made. Companies would want the best chances of survival and to retain the ability to seize the upturn when it comes. Locals want priority for jobs, and for staying in jobs. Government and the labour movement certainly want to help locals retain their jobs and to get back into work as soon as possible if they are retrenched. That was why Government introduced, and the Labour Movement fully supports, SPUR and the Jobs Credit Scheme.

From a strategic standpoint, foreign talent is needed to complement local talent to give Singapore that added competitive edge beyond what our small local population can produce. Foreign labour enables the overall economy to grow at a faster rate. This means that how we balance between the local and foreign employment is important in helping us maintain our grip on such competitive advantage during and beyond the downturn. I would like to ask the Ministry how it intends to, therefore, treat this subject of employment of foreigners at various levels and how it intends to tweak the work passes and employment

Column: 3192

passes system, if any, so as to better balance between jobs for Singaporeans as well as jobs for foreigners in this downturn.

Managing Foreign Workers

Mr Ong Ah Heng (Nee Soon Central): ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] A lot has been mentioned in the media about foreign workers and foreign talents. Today, I want to talk about workers who are employed in the HDB restaurants, eating shops and coffeeshops.

Sir, according to my knowledge, these shopkeepers employ foreign workers in the ratio of six-to-one. In other words, they have to employ six local workers before they can employ one foreign worker. One shopkeeper told me that coffeeshops do not need six workers; they need only two to four workers. All these are only in name, and the authority adopts an "open-one-eye and shut-one-eye" policy.

Many foreign women are working in our coffeeshops and many shopkeepers are willing to employ them because they are very hardworking. They are prepared to work for 12 hours a day and local workers are prepared to work only eight hours a day. It is said that those who work for 12 hours can get $1,000 to $1,200 a month. Those who work for eight hours get $800 to $900 a month. Although there are differences in wages, the difference in the total wage bill is not great, because to employ foreign workers, coffeeshop owners have to pay $150 foreign levy and $200 to $250 house rent. They only pay contribution for those local workers earning $800 to $900 a month. The difference is between 12 hours and working eight hours a day.

Most of the people who work in coffeeshops are older men and middle-aged women. The women have to look

Column: 3193

after their families, besides working in the coffeeshop; therefore they are not able to work for 12 hours. Similarly, it is also quite difficult for the older men to work for 12 hours because of their lack of physical strength. As we can see, it is quite acceptable for them to work in coffeeshops near their homes as they save on transport and time. Therefore, I would like to ask MOM how it can help those who cannot work for 12 hours a day to get jobs in coffeeshops? MOM should also explain why the authority adopts the "open-one-eye and shut-one-eye" policy towards these coffeeshops.

*Cols. 3297-3298.

The Chairman: Mr Inderjit Singh is not here. Ms Denise Phua.

Resilient Workforce and Foreign Workers

Ms Denise Phua Lay Peng (Jalan Besar): Sir, I came across many executives and even fresh graduates who are ill-equipped to look for employment during this downturn. Some retrenched executives I know apply to only one potential employer, usually MOE, and then pin all their hopes on that one chance. Resumes that were sent to me for circulation often do not make any impression or lack critical information. Others I know perform badly at interviews, clueless about the do's and dont's of interview etiquette.

A retrenched sales manager I know has applied to be trained as a nurse under the Ministry's Professional Conversion Programme, and he admits he may not be suitable, but healthcare is recruiting.

1.30 pm

Sir, similar to financial literacy, many Singaporeans, especially PMETs, need to acquire literacy in career planning and development. I was very impressed by the menus of training programme choices I saw in the websites of WDA, e2i and NTUC Learning Hub, and the like. But, like in corporations where needs analysis

Column: 3194

and planning are conducted before sending staff for training, I believe that job-seekers must pre-plan before they pick their training from the generous menus of 800 programmes that are subsidised by Government. Hence, I recommend that Ministry and WDA make available on their homepages a career planning toolkit complete with self-awareness questionnaires, career orientation profile assessments, interview tips, resume templates and materials on how one can take ownership of one's career. I will be happy to help stage the solutions in support of MOM if this can help more Singaporeans to be more effective in their job search.

Sir, on foreign workers. I am very pleased with the active participation of the Ministry of Manpower in working with my grassroots and other agencies in addressing my local residents' concerns, and promoting better harmony between local and foreign workers. Uniformed patrol teams organised jointly by key tripartite partners of grassroots leaders, MOM and the Police have helped very much to minimise undesirable behaviours of non-residents, and this is deeply appreciated by my residents.

Sir, with the economic downturn, the number of foreign workers stranded in Singapore without work is on the rise. MOM, grassroots, NTUC and even activists such as One (Singapore) and Transient Workers Count Too have stepped up efforts to assist these workers in matters like employer disputes, food lodging and repatriation. However, many are reluctant to be repatriated as they need employment to redeem the hefty loans they have incurred prior to coming to Singapore. Unfortunately, this root cause is not addressed and different parties often fingerpoint at each other when cases are highlighted by the media. I propose that Ministry: (1) Permit only authorised good quality recruitment agencies to recruit labour from abroad on

Column: 3195

behalf of local employers; (2) Dictate the range of fees that can be charged for these agencies' recruitment efforts in order to avoid hefty loans by the foreign workers. I believe Taiwan has some relevant legislation on this matter; (3) Ministry should step up, speed up and publicise enforcement actions against errant employers or agents who violated the relevant labour laws to safeguard the interests of these foreign workers; and (4) Initiate formal G-to-G (Government-to-Government) efforts to hold foreign missions more accountable and take a more visible lead in stemming the practice of charging exorbitant fees of these workers in the base countries.

Last but not least, Sir, I wish to urge the Minister to look into the plight of the many disabled workers in our country. I have already shared in this House the story of my deaf resident who lost a job during this downturn and still unemployed because potential employers do not even bother to want to interview her.

Sir, we have laws protecting pregnant Singaporean women. Even the NTUC has just set up the Migrant Workers Forum to look after the interests of foreign workers. But employment support services for the disabled remain in the dearth. The Minister has never ignored the special needs community even before he joined politics. I hope he will commission a team of thinkers and doers comprising MOM, MCYS, NCSS and VWOs to craft measures to ensure that the disabled in our country have access to paid work that matches their disabilities, and disabled staff will not be the first casualties whenever an economic downturn kicks in.

The Acting Minister for Manpower (Mr Gan Kim Yong): Sir, we are facing challenging times. Recently, the IMF had forecast that world growth in 2009 will fall to just half a percent, the lowest rate

Column: 3196

since World War II. The World Bank has projected that world trade volume will contract 2.1% in 2009, the first decline since 1982. How long the recession will last, how deep it will be, is still too soon to tell.

A major challenge for many countries is rising unemployment. The International Labour Organization has estimated that, globally, the number of unemployed could increase to 230 million in 2009 if the situation continues to deteriorate. In the US, unemployment surged to 7.2% in December last year, the highest in 16 years. In China, millions of migrant workers returned to the coastal provinces after the Chinese New Year festivities, but found that factories remain close. Across Europe, rising unemployment and fears of job security have led to unrest in countries like Britain, France and Greece.

In Singapore, our labour market has benefited from strong employment growth in recent years. Unemployment is lower than in many other countries. I am showing you a chart on the screen that shows different unemployment rates over different countries.

The labour market performed strongly in the first half of 2008, but eased in recent months, resulting in 227,200 new jobs for the whole year, lower than the 234,900 jobs in 2007.

Singaporeans have benefited from more as well as better jobs. More Singaporeans are employed than ever before. Based on our Labour Force Survey in 2008, the employment rate for the resident population aged 25 to 64 rose to a new peak of 77%, mainly due to more women and older workers joining the workforce. Dr Lily Neo just now asked about the results of our various training programmes, and higher employment rate of our workers is a reflection of the success of some of our programmes.

Column: 3197

More Singaporeans are also now employed in Professional, Managerial, Executive and Technician (PMET) jobs. PMETs now form the majority, or 51%, of the resident workforce in 2008, up from 41% a decade ago.

Wages have risen. The median monthly income from work for full-time employed residents rose over the year by 11% to $2,590 in June 2008, higher than the gain of 7.7% in 2007. After adjusting for inflation, the increase in real median income was still a healthy 4.1%. Median monthly household income from work increased by 13%, from $4,380 in 2007 to $4,950 in 2008, or 6.2% in real terms. Stronger growth was reported amongst lower-income households. Consequently, the Gini coefficient – which is a measure of income inequality – decreased for the first time since 1998 to 0.481.

However, in recent months, the impact of the sharp economic downturn has been felt in the labour market. Employment growth slowed significantly for both locals and foreigners in the last quarter of 2008. Out of the 26,900 jobs created in the last quarter, more than half went to local workers. Overall unemployment crept up to 2.6% in December 2008, while resident unemployment rate also rose to 3.7%. Nearly 16,000 workers were made redundant in 2008, a five-year high. More than half of this happened in the last quarter alone.

Going into 2009, the Singapore economy is projected to contract by between 2% and 5%. Our labour market will weaken considerably. Jobs growth will moderate further, while redundancies and unemployment will be higher than last year.

We must all work together as a strong and united team to weather the downturn and emerge stronger. The Government has rolled out a $20.5 billion Resilience Package. On the jobs front, $4.5 billion

Column: 3198

will be dedicated to preserving jobs through Jobs Credit. In addition, $650 million has been set aside for the Skills Programme for Upgrading and Resilience (SPUR) to train and upgrade our workers as well as help companies manage excess manpower.

We will take a three-pronged approach: first, help businesses remain viable and save jobs; second, help Singaporean workers keep their jobs; and, third, help the unemployed find new jobs.

Our first strategy is to save jobs by helping businesses manage their costs. First, the Tripartite Guidelines for Managing Excess Manpower and National Wages Council (NWC) guidelines offer employers and unions practical alternatives to retrenchment, such as shorter work weeks, temporary lay-offs and even wage adjustments, if necessary.

Second, Jobs Credit gives employers a 12% cash grant on the first $2,500 of monthly wages for each local employee. Compared to a CPF cut, Jobs Credit helps businesses without affecting workers’ retirement adequacy, housing and medical needs. It also helps to make local workers more cost competitive, as foreign workers do not qualify for Jobs Credit.

Third, SPUR helps to further reduce manpower costs when employers send their employees for training, through the enhanced course fee subsidies as well as absentee payroll. SPUR is also an important scheme to match workers to jobs, and I will talk more about this later. Today, SPUR covers over 800 courses in 24 industries, with a very generous 90% course fee funding across the board.

During the Budget debate, Members such as Mdm Halimah Yacob, Ms Cham Hui Fong, Ms Josephine Teo and Dr Ahmad Magad voiced the support for SPUR, and I thank them for this. The

Column: 3199

progress of SPUR has been encouraging. Through the efforts of the tripartite partners, just two months after SPUR started, more than 20,000 workers have already been committed for training. Close to 300 companies, spanning SMEs to multi-nationals, have committed to send nearly 13,000 workers for training. Another 7,500 individuals have signed up for training directly at the Continuing Education and Training (CET) centres, ITE as well as the five polytechnics.

We have also been working closely with employers who are participating in SPUR to ensure our courses stay relevant and effective. Mr Low Thia Khiang had asked how do we decide on courses to be included under SPUR. As rightly pointed out by Dr Ahmad Magad, SPUR must focus on equipping people with skills that are in demand. This is why we work closely with the industry to identify the types of skills to be included in the Workforce Skills Qualifications (WSQ) system, and select courses that are nationally-recognised, valued by industries and employers, as well as delivered by quality training providers. This approach will yield better outcomes from training.

We will also facilitate placement of the participants after training, and monitor the outcome. The list of SPUR courses will be regularly refreshed to take into account the manpower and skills needs in the different industries.

Several Members have commented about how to improve implementation of SPUR. Let me address these issues briefly.

Mr Teo Ser Luck had asked about the absentee payroll for training outside working hours. If a company sends its workers for training outside working hours, the absentee payroll is paid to the worker, and the employer just tops up the

Column: 3200

remaining 10% to 20% or $1.50 an hour or less. This sum is very small but the element of co-payment from the employer is important because it demonstrates the employer’s commitment and partnership with SPUR.

Ms Cham Hui Fong had asked during the Budget debate if workers employed on shorter workweek and sent for SPUR training can get at least a part of their absentee payroll. This is indeed the case. Employers and workers on shorter workweek will always be better off if workers are sent for training as they can both benefit from the absentee payroll.

During the Budget debate, Dr Ahmad Magad and Mdm Ho Geok Choo suggested expanding the list of Approved Training Organisations (ATOs) that offers SPUR approved courses. Selected Workforce Skills Qualifications (WSQ) ATOs which have performed satisfactorily under WDA’s quality assurance system, will be included under SPUR to expand the range of quality providers available for training workers. More than 60 WSQ ATOs will qualify for SPUR. More can be included later if they meet the
performance in future.

Jobs Credit and SPUR are already having an impact on the ground. MediaCorp, for example, is a company that will be implementing comprehensive measures to control costs and save jobs. Amongst the measures it will adopt are an Alternate Short Week Scheme, and a suspension of the policy to carry forward leave, wage restraint and a cut in their variable component. As a responsible employer with 2,700 staff, MediaCorp makes it a point to consult the union in decisions that will impact its staff. More
recently, it has plans to leverage on SPUR to up-skill an estimated 30% to 40% of its workforce, over a two-year period. MediaCorp welcomes SPUR and Jobs Credit Scheme as means to help manage their business costs.

Column: 3201

Other companies are using the Jobs Credit and SPUR to seize new business opportunities. Charles & Keith, a well-known retailer, is using Jobs Credit Scheme and SPUR to expand their operations and raise their service levels to greater heights. They will be hiring 25 more workers to support their expansion locally and will be sending them for Retail WSQ training.

Unlike some countries which provide extensive unemployment welfare to displaced workers, our measures help employers preserve jobs to minimise retrenchments and unemployment. This will benefit workers. I strongly urge employers to work with their unions and workers to take full advantage of Jobs Credit and the training opportunities under SPUR, so that we can continue to sharpen our competitiveness and enhance workers’ employability during this downturn.

Our second strategy is to help employees keep their jobs. By participating in SPUR, workers can upgrade their skills, improve their productivity, enhance their employability, and contribute more to their employers. They will become more valuable and more cost competitive to their employers. This way, we help them keep their jobs.

During the downturn, employees also need to be more flexible in their expectations. Some of them may need to be redeployed, adjust their work schedule or accept lower bonuses and wages, to help the company stay competitive and viable.

1.45 pm

Even as we try to keep jobs, this downturn will inevitably affect some low-wage workers. To help older low-wage workers and the self-employed, some of whom we may see a reduction in their income during this economic downturn, the Resilience Package will also provide a

Column: 3202

one-off Workfare Special Payment. The Special Payment will be given entirely in cash to help workers meet their financial needs. They will receive up to a total of $1,200 paid over three payments, or up to $400 for each payment. Let me explain how the Special Payment will work.

We will make Special Payments for work done in 2008 and 2009, together with the regular Workfare payments. The first payment will be made in March, actually, this is one month earlier than the usual Workfare payments, so that workers can receive help earlier. This will be based on work done in 2008 and on the same criterion as the regular Workfare scheme.

We recognise that some low-wage workers may experience less regular employment this year during the downturn. Therefore, the work criterion for the 2009 Special Payment will be less demanding to make it easier for low-wage workers to qualify. Under regular Workfare, a worker would need to work at least three months out of any six-month period to qualify for each of the half-yearly payment. For the 2009 Special Payment, so long as the worker has worked two months in any six-month period, he will be entitled to half that payment. If he works three months, of course, he would qualify for the full half-year payment, just like the regular Workfare.

Like WIS, the Special Payment is available also to self-employed and informal workers, as well as contract and part-time workers, provided they make CPF contributions and meet the criteria. I urge self-employed persons and informal workers to make Medisave contributions to qualify for WIS and the Special Payment. Their contribution rates have already been reduced two years ago, and the Special Payment is made in cash.

The assistance provided by Workfare and the Special Payment is significant. Let

Column: 3203

me give you an example. Consider Mdm Siti, a 62-year-old hawker who earns an average of $1,000 per month. As a self-employed person, she is required to make an annual Medisave contribution of $339, or less than $1 a day for two years (2008 and 2009). This can even be paid for using the GST Credits which she would receive in March and July. If she works in 2008 and 2009 and contributes to her Medisave, she can receive $800 cash from the Special Payment and $3,200 in WIS into her Medisave. The total help from Workfare and Special Payments for these two years of work is $4,000. This is equivalent to four months' worth of her income.

Our third strategy is to help unemployed workers. Even in the downturn, new jobs will be created. At least 45,000 new jobs are expected over the next two years, including many at the PMET level. In the public sector alone, the majority of the 18,000 jobs will be for positions that require at least a Diploma qualification.

Mrs Josephine Teo would be glad to know that my Ministry is working with economic agencies to see how we can provide more on-the-job training opportunities in areas that will be especially beneficial to fresh graduates. EDB has announced a $100 million programme, PREP-UP, which includes support for on-the-job training in science, technology and engineering. This will allow companies to develop and retain a pool of experienced manpower within an industry, so that the manufacturing and exportable services sectors can seize new opportunities when growth recovers.

There are also existing jobs out there at all levels, ranging from allied health professionals, hotel executives and F&B managers, to engineers and workplace safety and health officers in manu-

Column: 3204

facturing and construction sectors. But some job-seekers may not have the skills to take up these jobs. They may need to re-skill to move into new careers in a less familiar industry and they may need help to find opportunities in these industries. We will help them, through training under SPUR, through career counselling, and through job matching services.

SPUR benefits all job-seekers, whether they are less-educated and low-skilled, or PMETs. For the less-educated and low-skilled workers, whom Dr Ahmad Magad asked about just now, other than the generous 90% course-fee subsidy for SPUR training, they may also receive a training allowance. Unemployed job seekers can approach career consultants at the Community Development Councils (CDCs) and NTUC's Employment and Employability Institute (e2i). The career consultants will assess the job-seeker's training needs as well as his commitment to find a job after training, in deciding whether he will receive a training allowance. Job-seekers may also be advised to take up Employability Skills System (ESS) modules to close gaps in language proficiency and numeracy skills. In addition, low-wage workers will be eligible for WIS and the WIS Special Payment, which I have elaborated on earlier.

This rigorous and yet flexible approach is better than a rigid set of criteria for granting training allowance, as suggested by Mr Low Thia Khiang, which may not cater to the varied needs of different individuals.

For PMETs, the subsidy rate for SPUR-approved PMET courses has been increased from 80% to 90%. This makes skills training even more affordable. The range of Professional Conversion Programmes (PCP) which helps unemployed PMETs to up-skill or convert to new sectors, will be doubled from the currently

Column: 3205

23 to around 40 by the end of this year. PCPs will also be expanded to include tertiary level courses in areas where there is demand for skilled workers, such as social work, infocomms, logistics and hospitality.

Dr Lim Wee Kiak will be pleased to know that since the PCP started in 2007, close to 580 trainees have been placed in jobs through the PCP. Another 520 trainees are currently still undergoing training in PCP, which can last up to three years.

WDA has strengthened the career services and job matching capabilities of all the CDCs to cater to job-seekers, including PMETs. They have started regular workshops conducted in conjunction with private specialists, on personality self-assessment, resume writing (as Ms Denise Phua mentioned), interview tips, skills and jobs in demand, and meeting with potential employers. For PMETs who may have been in the same field for a long time and require more intensive help to transit to a new career, more specialised assistance will be provided through career consultants, supported by outplacement specialists and career coaches.

Dr Lim Wee Kiak noted that it might be difficult for PMETs and their families to depend on the PCP allowance. This allowance of up to $1,000 a month for longer courses is a reasonable amount. By the way, in reply to Mr Teo Ser Luck, there are allowances for PCP for PMET trainees. As I have said, this allowance, although up to $1,000 a month is reasonable. It is not intended to support the needs of the entire family. PMETs typically have more resources and should tap on these resources first. The Government is also providing additional help for households through GST Credits, personal income tax rebates, rebates for utilities, property tax, and service and

Column: 3206

conservancy charges, and so on. Let us monitor the progress of the programme for the time being.

Mr Heng Chee How and Dr Lily Neo asked what more can be done to improve the sourcing of jobs and the efficiency of job-matching. Today, WDA already links up with the economic agencies like EDB to match job vacancies with job-seekers. WDA officers actively work with employers who are looking for skilled workers, to identify vacancies that can be matched to Singaporeans. Also, we have about 20 Place-and-Train (PnT) programmes, and will continue to work with employers to launch more in spite of the downturn.

Mdm Cynthia Phua, Mrs Josephine Teo and Ms Denise Phua would be pleased to note that we have also enhanced WDA's website to be a one-stop resource portal for job-seekers. It has tips for job-seekers too, including how to write resumes. JobsNet has links to public and private sector job portals, information on recruitment events and the labour market, training opportunities as well as career search tips.

While we do our utmost to help, job-seekers must ultimately take the driver's seat in managing their own careers, so that they can stay ahead of the curve. The Government can provide help and support, but job-seekers must have the right mindset and expectations, be proactive in their job search, be prepared to take up training, and be open to jobs in industries different from their previous occupations.

Let us learn from two fellow Singaporeans. The first one is Mdm Hamidah Bte Abdul Ghani. She is 51 years old with secondary education. She had been unemployed for a few months when she first approached North West CDC Career Centre for help. Previously, she had worked in the hospitality industry

Column: 3207

in a range of jobs, such as a part-time towel attendant earning $500 a month. To secure a better-paying job, she decided to switch to a different sector and signed up for the WSQ Higher Certificate in Therapy Services with Health Management International. When her training ends in May this year, she can look forward to finding a job in the healthcare sector as a therapist assistant earning about $1,100 a month, doubling her previous income. She will also be entitled to Workfare as well as the Special Payment, equivalent to about $100 a month. She will receive $5,900 of course fee subsidy and another $2,300 of training allowance in cash. This works out to over $8,000 in total, which is a generous support for her.

In another example, Ms Debora Neo, aged 43, with a Masters in Business, was previously working as a Purchasing Projects Leader at an electronics company. She was retrenched in December last year, due to a downsizing exercise. After she went to a North East CDC job fair, she applied to join the PCP for Tourism, which is a 12-month work-study programme. Commencing next month, the programme will not only equip her with a WSQ Diploma in Tourism, but also offer her practical apprenticeship experience with Sentosa Leisure Group across four different business areas – retail, F&B, attractions and events. She has just been successfully selected for the programme and I wish her well in her endeavours.

These examples show that if one is open to different possibilities, willing to undertake the necessary training, be flexible and embrace change, this economic downturn can actually open up new opportunities to rewarding careers. Just like the Chinese saying, " shan qiong shui jin yi wu lu, liu an hua ming you yi

Column: 3208

chun ", we can therefore be more confident and adopt a positive attitude.

While we tackle the challenges of the downturn, we must also keep our eyes on the future. Over the past few years, we have strengthened the competitiveness of our workforce, invested in skills upgrading, pushed for wage restructuring, re-balanced CPF contribution rates and implemented Workfare. We are now pushing for re-employment so that older workers remain employed beyond the statutory retirement age.

We must press ahead with our efforts to build a globally competitive workforce, so that we can seize new opportunities when the economy recovers. Our three key strategies are:

(a) Improving productivity;

(b) Enhancing mobility for workers; and

(c) Maintaining a flexible labour market to meet industry needs.

Our ability to improve the standard of living over time depends on our ability to raise productivity. Improvements in real wages can only come about with sustained productivity growth over time.

I thank Mrs Josephine Teo and Ms Denise Phua for their comments to step up efforts to improve our productivity. Over the 10-year period, from 1997-2007, Singapore's labour productivity grew by 2.4% per annum. However, in the last four years, labour productivity actually fell by 1.2%. There is room for improvement. My Ministry and the Ministry of Trade and Industry and co-leading an inter-agency committee to look into productivity issues. We will need to take a differentiated approach for the different industries, so that our strategies can be tailored to the specific needs of each industry.

Column: 3209

For their part, industries and companies must be prepared to take ownership and spearhead initiatives to raise productivity. In the current downturn, there is even greater impetus for companies to review their business models and operations, and aim for higher productivity. The services sector, for example, can focus on the following.

First, emphasise service excellence. We need to nurture a service culture among our service workers and professionals, so as to achieve excellence. This includes ensuring that they have the necessary language ability to service their customers effectively.

Second, develop people. Employers and workers must continue to invest in industry-relevant skills upgrading, by leveraging on SPUR. They can also tap on SPRING-WDA's HR Capability Package which provides a framework, guidelines, tools and templates to help strengthen HR abilities to attract, develop and retain talent. Third, embrace constant innovation to stay ahead of competitors. Fourth, industry associations can initiate benchmarking and research projects to help industry players adopt best-in-class methods.

2.00 pm

Next, promoting mobility. The second key strategy is promoting the mobility of our workers through skills upgrading. Our economy is constantly undergoing restructuring to keep pace with the changes in the global economic landscape. This is even more apparent in a downturn when the restructuring is faster and broader. Singaporeans will need to be equipped with skills not only to move upwards in their careers, but also to move across industries into new jobs.

Last year, we launched the CET Masterplan, a blueprint for building up a first-class national Continuing Education

Column: 3210

and Training infrastructure over the next decade. This has allowed us to roll out SPUR in a very short span of time.

The number of CET Centres has more than doubled from 18 to 42. The number of training places will be doubled to 230,000 this year. The Institute for Adult Learning (IAL) was established to develop professional adult trainers, and to conduct applied research into adult training to raise training quality and outcomes.

Over the years, WDA has been building up a rigorous quality assurance system to ensure that training programmes offered by our CET Centres are relevant and benefit trainees. I am pleased to announce that three of our CET Centres will now be appointed as National CET Institutes (NCI). These are the Centre of Urban Greenery and Ecology (CUGE), the Tourism Management Institute of Singapore (TMIS) and At-Sunrice Globalchef Academy. They have established a top-quality, rigorous continuing education and training programme with excellent outcomes for training and placement. I look forward to them continuing to lead the way in building stronger industry capabilities and developing CET in Singapore.

Thirdly, maintaining labour market flexibility. Several Members, such as Mr Ong Ah Heng, Mr Heng Chee How, Dr Ahmad Magad, Dr Lim Wee Kiak and Mrs Josephine Teo, have spoken on our foreign manpower policy. Foreign manpower augments our workforce on three fronts. First, as pointed out by Mr Heng Chee How, availability of foreign talent is a key competitive advantage that helps to anchor strategic investments and to bolster our growth industries. Second, we need foreign workers for jobs in sectors such as construction and marine, and in areas that Singaporeans might not have the required skills for, or are not willing to do. Third, foreign manpower

Column: 3211

helps keep our businesses globally competitive.

The number of foreign workers will come down eventually as the economy slows down further. We should not undermine our competitive advantage of a flexible labour market or deviate from the fundamental policy to attract and retain talent, as we address the short-term challenges of the recession. Singapore has to remain an attractive place for businesses, so as to retain those which are here and attract new investments that will bring in more and better jobs for Singaporeans. This is what Dr Ahmad Magad talked about, in terms of job creation. Recently, we heard an announcement by Rolls Royce which is removing their global HQ for marine division from London to Singapore, and this will create jobs for Singaporeans.

It is really like running a race in an athletic meet. One easy way to win the race is to get rid of those who are running faster than us. This way, if we get rid of enough runners, we will eventually be the winner, never mind if we are the only one running. But such a victory will be short-lived, because having run our own race, soon, we will have to compete not just in a local race but on the global stage, for example, at the Youth Olympics which will be held here in 2010. We cannot get rid of all the other competitors just because they are faster than us, and make it into a locals-only game. It is better for us to train our athletes, make them stronger and help them compete. Similarly, Singapore must compete globally to survive and progress.

If we add restriction or cost to companies' access to foreign manpower when our economy slows down, they may very well relocate to countries where they can have unrestricted supply of cheap labour. Instead of hurting

Column: 3212

businesses and sending the wrong signal to investors, it is better for us to go for a win-win strategy. This is what we have done. Our approach is to spur our athletes on by improving their odds of winning – subsidised training, quality equipment, better running shoes, good coaches – so that they can have an edge over other runners in the race. Likewise, we are enhancing the employability of Singaporeans through training opportunities under SPUR, and their cost competitiveness through Jobs Credit and WIS, thereby significantly tilting the balance in favour of local workers. This is in addition to the dependency ratio controls and the levies that we impose on employers.

Having said that, we should nonetheless continue to improve the skills and quality of foreign workers coming here. The S-Pass introduced in July 2004 was meant to provide flexibility to employers, to address the shortfall of skilled manpower at the Diploma and post-secondary level. We will raise the criteria of S-Pass holders coming here to improve their quality. MOM will be briefing the industry shortly on these changes.

Mr Ong Ah Heng raised a concern about phantom workers who might be used to skirt around the foreign worker dependency ratio framework. I would like to reassure Members that we are stepping up enforcement efforts to preserve the integrity of controls over foreign workers. MOM is currently investigating 33 cases of possible use of phantom workers. An owner of a food and beverage outlet has been charged in court for allegedly falsely declaring phantom workers in work permit applications.

Our resilience to the economic downturn and our key strategies are all underpinned by Singapore's tripartism. The mutual trust and shared interests among the tripartite partners have enabled

Column: 3213

the unions, employers and the Government to work together during difficult times, to implement tough measures to help businesses and workers weather crises, minimise job losses, and reposition ourselves for growth in the future.

Sir, we are not running a singles race. We are running a 4-by-100 metres relay. And who are the runners? The workers, unions, employers and the Government. The workers are not running alone. We are with them. If we run together as a team, we will not only win medals, but we will set new records.

Job Recreation Programme

Mr Low Thia Khiang: Sir, the Job Recreation Programme (JRP) aims to redesign jobs to make older workers more productive and, hence, higher pay. The WDA sets aside $40 million over three years in 2007 for this programme. Globalisation and Singapore's rapid development into a more knowledge-based economy has resulted in less skilled older workers finding employment opportunities more difficult. The current recession worsens the employment prospects of these older workers as even younger workers face retrenchment when businesses downsize. Therefore, it is important to scale up the JRP to sustain employment for older workers in these recreated jobs. Is the budget of $40 million over three years enough?

The NTUC's website shows that JRP has helped 43,484 workers from 2005 to July 2008. What is the number of workers to be helped in 2009? Are these Singapore citizens, or does it include Permanent Residents as well? I would like to know what is the Government's strategy in helping older workers in this economic downturn, as many of them have contributed to Singapore's development from a Third World to a First World status only to find themselves unwelcome in the job markets in our

Column: 3214

supposedly Swiss standard of living. How does the Government reconcile the prospect of structural unemployment for this group of older, less skilled workers with the continued extension of the retirement age as well as increasing Minimum Sum amounts that limit many of these older Singaporeans to very little payout at the age of 55?

Re-employment of Older Workers

Mr Heng Chee How: Sir, the ongoing economic crisis will make the re-employment of older workers more challenging. Companies, faced with tough choices, may prefer other types of manpower, eg, younger manpower, foreign manpower, or contract manpower. Data from the unionised sector indicates that the total number of unionised workers employed beyond 62 years of age has fallen from 5,400 in 0ctober 2008 to 4,650 at the end January 2009.

Yet, ageing is a trend that does not vary with the economic environment. It is relentless and it is recession-proof. If we slow down our preparations for an ageing population, all it means is that our society will have to confront that reality in a less ready state, and then scramble to plug gaps. One of the central pillars of preparing for an ageing population is the re-employment of older workers. This will need the means to fund lengthening lifespans.

I would like to know what are MOM's plans to ensure that while we tackle the serious economic crisis before us, the longer-term need to keep people working for as long as possible is not abandoned or overly compromised. I would like MOM to indicate whether the economic crisis will lead to any postponement of the Government's introduction of a Re-employment Law by 2012?

In a 29th January 2009 article in the Business Week entitled "This Time, Old

Column: 3215

Hands Are Keeping Their Jobs", columnist Joseph Weber reported that, "On January 28, Boeing boosted to 10,000 the number of jobs it plans to cut this year. But it's likely to spare many older workers." The company recalled the late 1990s, when voluntary buyouts left it short of experienced hands. "We don't want to get ourselves into that kind of situation again," says Richard Hartnett, Director of global staffing. "This time the cuts will be involuntary, and Boeing will pick and choose." In other words, Boeing has learned from previous experience of the value of older workers and their experience.

Sir, I would like to ask MOM what plans it has to better inform and persuade companies in Singapore on the value of our experienced workers.

CPF Savings as Retirement Funding

Ms Sylvia Lim (Non-Constituency Member): Sir, the CPF LIFE scheme which will start in 2015 will provide qualified Singaporeans with a payout of at least $350 per month for those with full Minimum Sum in their Retirement Account. I would like the Minister to consider helping elderly Singaporeans who do not have much in their CPF and are not to be covered by CPF LIFE. These Singaporeans have less than the Minimum Sum at drawdown age.

As the rules require whatever small savings they have to be drawn over 20 years, many of them will draw down less than what a PA recipient will receive at $360 a month. Take, for example, the case of Mdm A, an elderly Singaporean aged 70, with less than $24,000 left in her CPF savings and living alone in a rented flat. Currently, she is drawing down less than $300 a month from her CPF to survive. She worries when and where her next meal will come every

Column: 3216

month. The PA allowance is a useful reference point, as the Ministry of Community Development, Youth and Sports says, "It is calibrated to provide for the basic living needs of PA recipients." If the Government thinks that $360 is what a PA recipient needs for basic living a month, it cannot expect an elderly Singaporean like Mdm A to subsist on less than $300.

I would like to ask the Minister to seriously consider allowing elderly Singaporeans who do not qualify for CPF LIFE and PA to draw down on their CPF savings an amount equivalent to the PA allowance every month. We should not make these people worry about how to make ends meet every day in their old age.

I am not asking the Government to fund the basic living needs of these elderly Singaporeans. I am only asking the Government to allow these people to draw down on their own CPF savings an amount equivalent to the PA allowance. The Government may worry that these elderly Singaporeans will exhaust their savings in less than 20 years. Well, if they outlive their CPF savings, they can join the PA scheme after that which, after all, is designed to make Singaporeans who are unable to work, owing to old age and have no means of subsistence, to have some support from the Government.

CPF LIFE

Dr Ahmad Mohd Magad: Mr Chairman, Sir, as raised by Ms Sylvia Lim, I too am interested in the details of CPF LIFE. As we confront the current economic downturn, it is imperative that we also not lose sight of the longer term retirement needs of Singaporeans.

CPF LIFE represents a creative approach to make CPF members' savings last a lifetime. The Minister has announced that members turning 55 in

Column: 3217

the year 2013 with $40,000 of CPF savings will be automatically included in CPF LIFE. Can the Minister for Manpower (1) provide an update on the status of implementation of CPF LIFE;

and (2) explain how this scheme is beneficial and will provide a lifelong income for members?

2.15 pm

Mdm Halimah Yacob (Jurong): Sir, I would like to ask the Minister four questions on CPF LIFE. First, could the Minister give an update on CPF LIFE? The scheme was started last year but we have not heard very much about the scheme up to now.

Second, Sir, the CPF LIFE scheme offers 12 different plans for members to choose from. The sheer number of plans is simply mind boggling and I seriously wonder how anyone would be able to make a proper choice, bearing in mind that not all CPF members understand insurance products well. While we want to give people choices, too many may also confuse and actually deter them from making a decision. In the end, I fear that people would just go for the default option. Sir, I would like to ask the Minister what are MOM's plans to help CPF members choose from so many life plans? Are there any plans to simplify the scheme?

Third, to be automatically covered under CPF LIFE, members must have $40,000 in their retirement account. This requirement excludes quite a number of Singaporeans, such as housewives and low-income contract workers with insufficient CPF savings when these are precisely the groups that need the most help to build up their retirement income. We should make the CPF LIFE scheme as inclusive as possible and not let the scheme become an example of the social-divide in our society. Sir, I would like to ask the Minister what efforts are being

Column: 3218

made to help those without $40,000 in their retirement accounts to also benefit from CPF LIFE?

Finally, could the Minister indicate what would be the impact of the current severe economic downturn on the CPF LIFE scheme? As the interest rate has gone down, could the Minister indicate whether this will effect the adequacy of the CPF LIFE scheme payouts?

Mr Ong Ah Heng: ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Mr Chairman, the introduction of CPF LIFE is an enhancement of our CPF. It is a good change. The scheme is in line with the demographic change in our population as a result of long life-span, and to have enough savings for our twilight life is a challenge for us.

CPF LIFE provides a stream of stable income for those above 65 years of age. All Singaporeans would like to be entitled to be under this scheme. But some, for various reasons, are not able to benefit under this scheme, particularly those self-employed. In fact, they are quite indifferent to this scheme. What worries us is that there are one million women who do not have Medisave savings and they are not included under this scheme. This is quite worrying because women live longer than men. If they do not have anyone to depend on, it will be quite sad.

How will MOM help them and those who do not come under CPF LIFE automatically to come under this scheme too?

*Cols. 3299-3300.

Mr Teo Ser Luck: Sir, like what Mr Ong commented about the retirees and those who have been included in CPF LIFE, I have met many of the retirees in my constituency and they are very worried about whether their CPF is sufficient or whether they could have a lifetime income for the rest of their lives. I think for those

Column: 3219

who can live off their family members, extended family members or children, they do not have a problem. But for some of those who are self-employed, they are not too sure if it will be sufficient for them because they might not have contributed to CPF until later in their lives. So for some of them, they wanted to opt into CPF LIFE but they do not know the details.

I understand that the Minister has actually said in his reply to a parliamentary question last year that members who are not automatically included in CPF LIFE can opt in. Can the Ministry provide an update on how members can opt in and when they will be allowed to do so? What are the incentives for the member's spouse, children or siblings who want to top up the member's CPF account in order to help the member benefit from the CPF LIFE scheme? And also with the economic downturn, are there actually any impact on the payout, if the downturn is extended over a longer period of time? CPF LIFE is a good scheme that ensures income for life, but it can only be good if workers or CPF members are included in the scheme.

CPF

Dr Lim Wee Kiak: Sir, the current economic downturn is so severe that the Government is taking unprecedented moves, such as Jobs Credit Scheme, Special Risk-Sharing Initiative scheme and the use of our well-guarded national reserves. Many have asked, since the Government is allowed to take such unprecedented moves to use the reserves, should the Government allow the people of Singapore to share part of the burden of shouldering this economic downturn by allowing the people to use their reserves that they have painstaking saved for retirement over the years, such as their CPF?

Column: 3220

Similar to the Government, the reserves in the CPF of the people can be rebuilt again when the good times return. Allow the people to use part of their CPF in such hard times can also provide some relief for those who were unfortunate to lose their jobs or had suffered significant pay cut. Similar to strict and careful guidelines for the use of our national reserves, Government can draw up guidelines to ensure that the use of the CPF is now exceptional for one-off purpose and not for long-term subsistence of daily living. We can limit the use of CPF for the following purposes for one year. For example, we may allow the use of CPF for capacity building for the future, such as the payment of the cash portion of the SPUR or PCP training programmes of individuals that is up to 10% of training course fees as the Government is subsidising the remaining portion.

For those who do not have sufficient monthly CPF contribution to cover all their home mortgages, perhaps the Government can allow them to use part of their special account to supplement the cash component, so as to free up some more disposable income for their families to shelter the economic storm, or perhaps we should adjust the contribution rate to special account so that there is more that is going into ordinary account in such hard times.

For those who are retrenched, perhaps we can allow them to use their CPF in Special Account to pay for their home mortgages till they can find a job. This is better than deferring or lowering the mortgage repayment which will result in more interest payment over long time.

For those who are retrenched and had significant pay reduction and are finding it hard to pay their income tax, perhaps the Government can allow them to use their CPF for payment of either in full or in

Column: 3221

instalments so that their precious cash reserves can last longer while they look for another job.

Although the main purpose of our CPF is to build up our retirement needs, these are exceptional times and we should consider exceptional measures to tackle the problems head on. For a family whose main bread-winner has lost his/her job, the immediate crisis is the day-to-day living and survival, rather than their retirement needs in 20 to 30 years' time. I hope the Ministry of Manpower can consider some of these suggestions which may be useful now. If not now, I hope the Government can consider them later if the economic storm gathers strength and further off-Budget measures may be needed.

Workfare Income Supplement – Assisting Low Wage and Contract Workers

Dr Ahmad Mohd Magad: Sir, I would like to first thank the Minister for his clarification on the Workfare Income Supplement (WIS) earlier. However, I would like to know if the qualifying criteria for the scheme can be broadened so that more people can benefit from this scheme. In particular, I would like to ask whether WIS can be extended to informal or odd-job workers.

In a recession, the number of informal or odd-job workers may increase as some of those who are retrenched may have no choice but to take up odd jobs while trying to secure another full time job. Currently, informal workers who meet the income criteria can qualify for WIS only if they make a Medisave contribution. In doing so, the total amount of WIS payout goes into their CPF accounts and there is no cash benefit for the workers.

In the light of the recession, I would like to know if the Ministry could extend the part-cash and part-CPF payout of WIS

Column: 3222

for informal workers? This arrangement can be temporary so that informal workers have more cash in their hands to cope with the downturn.

Mr Gan Kim Yong: Sir, while many of us may be preoccupied with the present economic crisis, we must not lose sight of the long-term challenges that need to be addressed. One such issue is the ageing population.

By 2020, one in six Singaporeans will be aged 65 or above. Re-employment will be an important cornerstone to build a resilient and sustainable workforce, and to help workers secure a more comfortable retirement. For this reason, we will introduce the re-employment legislation by 2012. The tripartite partners have been working closely over the last two years to prepare our companies and our workers for re-employment. We have made good progress in our efforts to improve the employability of our older workers. The employment rate of residents aged 55 to 64 has been increasing steadily over the past five years from 45.2%, in the last economic downturn in 2003, to 57.2% in 2008.

Preliminary findings from a survey which my Ministry carried out last year found that 85% of local private sector employees work in companies that offer opportunities to work beyond retirement age. This is encouraging. Jenny Pow is a good example. Jenny joined CTC Holidays as an Admin Assistant in 2003. She is a hardworking and meticulous worker. Last year, when she turned 62, instead of retiring, CTC offered to let her continue working as she still has much to contribute. The company is also sponsoring her for a training course in online ticketing to help her adapt to technological advancements in the industry. In this downturn, it is all the more important to invest in training and upgrading, and to make better use of our older workers.

Column: 3223

However, as pointed out by Mr Heng Chee How, the current economic crisis can hamper our efforts in implementing re-employment. We must therefore press ahead to raise the employability of older workers and to prevent the gains of our earlier efforts from being eroded.

To help older workers stay employed and minimise structural unemployment, we will need to encourage and help them to re-skill and upgrade. This way, they can remain relevant and productive, and be re-employed when they reach their retirement age. We will continue to work with tripartite partners to help employers hiring older workers through programmes, such as the ADVANTAGE! Scheme. We will also continue our outreach efforts, such as through regular industry briefings and the re-employment web portal to help employers and workers learn more about re-employment and how they can benefit from it. The Tripartite Implementation Workgroup on the Employability of Older Workers will continue to get feedback on re-employment experiences. The economic uncertainty provides an opportunity to understand the dynamics of re-employment in a different context, and will help the tripartite workgroups as they finalise the guidelines.

Mr Low Thia Khiang also asked for an update on the Job Recreation Programme (JRP) and its role in this downturn. The JRP aims to help local workers, including Permanent Residents (PRs), upskill and to help them take on better jobs. This is achieved through a combination of efforts to redesign jobs, train workers and professionalise industry practices. Since its inception in 2005, JRP has been successfully applied to several sectors, such as security and landscaping. Last year, over 20,000 workers benefited from JRP, up from the 15,000 in 2007. Cumulatively, since the programme started, more than 50,000 workers have

Column: 3224

benefited. Even in this downturn, JRP continues to be important and the enhanced support provided by SPUR will allow the programme to help even more workers. JRP is now led by NTUC's e2i, which aims to help 45,000 local workers through its programmes in 2009.

An example of a worker who has benefited from JRP is Mr Tham Kok Ying. Mr Tham worked in a boat building company for 36 years before being retrenched in October last year. Immediately, he enrolled in the Landscaping Job Preparation Exercise and subsequently a Screen, Train, Place and Track programme. After a week-long work trial by Kiat Lee Landscape and Building Pte Ltd and a 26-day WSQ course, he is now employed by the company and has been working there since.

Besides helping Singaporeans to work longer, the Government has also introduced important changes over the past few years to help Singaporeans improve their retirement adequacy. As Dr Ahmad Magad rightly pointed out, this is a long-term challenge and something we must not lose sight of, even in this downturn. Last year, we introduced CPF LIFE which will give CPF members an income for life. But I must stress that CPF LIFE is not intended to solve financial difficulties. It is meant for those who have savings in CPF and are qualified to benefit from a lifelong income.

Mdm Halimah Yacob, Mr Ong Ah Heng and Mr Teo Ser Luck have asked for updates on the scheme. To recap, all CPF members born in 1958 or later, will be automatically included in CPF LIFE if they have at least $40,000 cash in their Retirement Accounts when they turn 55. These members will enjoy a monthly income from age 65 for as long as they live.Because some members were concerned that they may have shorter than average lives, we have decided to offer CPF LIFE plans with a refundable

Column: 3225

feature. For such plans, depending on the member’s age when he passes away, his beneficiaries would receive a bequest amount, which is the remainder of his CPF savings plus a refund of any LIFE premium that has not been paid out.

To give members flexibility and choice, the National Longevity Insurance Committee (NLIC) had recommended offering members 12 different plans, six refundable and six non-refundable. Mdm Halimah asked how we can help members choose an appropriate CPF LIFE Plan. The original 12 plans gave members a choice but, at the same time, made it more difficult to decide. We have therefore reduced the number of plans from 12 to just four that are meaningful, simple and clear. For avoidance of doubt, let me clarify that payouts will start at age 65 for all four plans.

I will now elaborate. Two key factors that members need to consider are the level of monthly income and the bequest amount for his beneficiaries. These four plans will offer members a range of trade-offs between these two factors. The default plan is called the LIFE Balanced Plan. As the name suggests, it will provide members with a balance between a reasonable level of retirement income, and yet at the same time some bequest amount if they were to pass away early.

Let me give an example to illustrate this. A person, Mr Tan, 55 years old, who chooses the LIFE Balanced Plan. Let us assume he has $67,000 in his Retirement Account. Mr Tan can expect to receive between $570 and $620 every month from age 65 for as long as he lives. If Mr Tan passes away at the age of 70, just an assumption for discussion sake, his beneficiaries will receive a bequest amount of between $76,000 and $79,000. The monthly income and bequest amounts are given as ranges because the actual amounts will depend

Column: 3226

on actual interest rates and mortality experience. If Mr Tan prefers a higher monthly income, he can choose the LIFE Plus Plan but the trade-off is a lower bequest amount. If Mr Tan wishes to leave more for his beneficiaries instead, he can choose the LIFE Basic Plan but he has to accept a lower monthly income. If Mr Tan does not wish to leave behind any money because he has no siblings or for whatever reason, he can opt for the LIFE Income Plan, which offers the highest monthly income but has no bequest amount. The LIFE payout ranges under the four plans are shown on the slide for Members' reference.

Mr Teo Ser Luck asked how a protracted economic downturn will impact CPF LIFE payouts. As I have mentioned, apart from mortality, LIFE payouts will depend on actual interest rates. A lower interest rate would lead to lower payouts. Likewise, if interest rates rise, payouts will be higher. Therefore, we expect CPF LIFE payouts to be adjusted from time to time. This is in line with the principle that the scheme should be self-funded and sustainable. It is for this reason that I have given the monthly payouts and the bequest amounts in ranges. Nevertheless, the CPF interest paid by the Singapore Government will not fall below the guaranteed floor rate of 3.5% on the first $60,000 of CPF balances and 2.5% for amounts above that. This guaranteed interest rate is something that commercial providers are not able to offer.

When the NLIC deliberated on the pricing structure of CPF LIFE, it noted that many factors affected the lifespan of an individual. However, the Committee felt that the structure of CPF LIFE should be kept simple and easy to administer, yet fair to all its participants. Therefore, it decided to recommend only age and gender for the purposes of pricing, and not to take into account other factors such as whether a person smokes and whether he is obese, and so on. The

Column: 3227

NLIC also noted the possible effects of different socio-economic status (SES) on a person’s lifespan but found that there was no robust local data on SES. The NLIC, therefore, recommended that the Government study this further.

The CPF Board has completed its preliminary study of the possible relationship between SES and mortality. The study showed that there is a correlation between mortality and the selected proxies representing a person’s SES. However, it also showed that the age to which a person in any SES grouping will live, can fall in a very wide range. This is because life expectancies are affected by many factors including those related to a person’s health and lifestyle, for example, whether a person smokes, consumes alcohol, exercises regularly, and not just SES. It is unclear what the actual effect of the SES proxies would be, unless we could segregate the effects of health and lifestyle factors from these proxies in the study. If we did so, the effect is likely to be smaller. More importantly, the approximations involved in assessing an individual’s SES could in fact place some people in the wrong category. This would be unfair and run contrary to the objectives of the scheme.

The refundable option in CPF LIFE will mitigate to some extent the anxiety of some members that they may not live as long as others. With this option, members who die early will have a bequest amount as illustrated earlier. Members who prefer to rely on commercial annuities may also be exempted from CPF LIFE, provided that the annuity gives them benefits that are not less than that offered by CPF LIFE. We have, therefore, decided not to capture the effect of socio-economic differences on CPF LIFE, to keep the scheme simple. LIFE premiums will only be based on gender and age, which is the standard practice in many existing annuity

Column: 3228

schemes. Most insurance schemes around the world have also not adopted SES factors in pricing their premiums.

Let me move on to opt-in for older members. While those who are aged 51 and younger this year will be automatically included in CPF LIFE, older members can also opt in. I am pleased to announce that from September this year, the CPF Board will start inviting older members aged 55 and above to opt into CPF LIFE. LIFE payouts for the older members will start as early as January next year. Younger members will be invited when they turn 55. When members opt in, they can also receive up to $4,000 from the L-Bonus, and up to $1,800 from the V-Bonus. Participants of the Lease Buyback Scheme, which was announced earlier, will be automatically enrolled into CPF LIFE to provide them with a lifelong income.

Let me give Members an example. 61-year old Mr Veloo has $67,000 in his Retirement Account. Under the Minimum Sum Scheme, he would have received $390 for about 20 years. Let me show you why it makes sense for Mr Veloo to opt in to CPF LIFE. If Mr Veloo earns less than $1,200 per month and lives in a small flat, he will receive the maximum L-Bonus of $4,000. He will also receive a V-Bonus of $1,800. If Mr Veloo opts for the LIFE Balanced Plan, starting from January 2010, he can expect to receive between $380 and $400 every month, not just for 20 years, but for as long as he lives.

Mdm Halimah asked how we are helping CPF members including contract workers who do not have sufficient savings to participate in CPF LIFE. Firstly, let me clarify that there is no minimum balance required. Therefore, those with lower balances than $40,000 can still opt into CPF LIFE.

Secondly, we want to encourage families to help their older family members

Column: 3229

by topping up their CPF. Last year, we made it easier for CPF members to receive top-ups to their Retirement or Special Accounts from family members and other individuals under the Minimum Sum Topping-Up Scheme. This year, we will liberalise the rules further. Previously, we only allowed those with at least 1.5 times the prevailing Minimum Sum in their CPF balances to make top-ups using their CPF savings. From 1st April 2009, they need only have CPF balances of at least the prevailing Minimum Sum, to be allowed to make CPF top-ups. From 1st August 2009, we will also remove the age restriction that CPF top-ups to parents and grandparents can only be made to those aged 55 and above.

Top-ups, whether by cash or CPF, can help older CPF members participate in CPF LIFE, enjoy the L-Bonus, CPF 1% extra interest and possibly higher D- and V-Bonuses as well. Naturally, if CPF members continue to work after 55, this would be the best way for them to continue building up their balances to participate in CPF LIFE. Contract workers who are older low-wage workers will receive additional help in the form of Workfare.

I will now briefly touch on other issues regarding CPF. First, on the use of CPF for housing. Dr Lim Wee Kiak was concerned that members who suffered reduction in wages during this recession could have difficulties servicing their housing loans. He suggested that these members be allowed to use their Special Accounts (SA) to service their housing loans. I wish to reiterate that savings in the SA are meant for retirement. Allowing CPF members to dip into their SA to finance their homes could seriously affect their retirement adequacy. We had in the past allowed limited usage of the SA for housing when CPF rates were cut, but only to the extent where the members were affected by these cuts. However, in

Column: 3230

the current economic downturn, CPF rates have not been reduced. Instead, the Government has introduced the Jobs Credit Scheme.

MND had earlier also announced measures to help home owners who may encounter difficulties with paying their mortgages. It is, therefore, not necessary to dip into their SA.

Dr Lim also suggested allowing a one-off withdrawal of CPF for training under SPUR. It is not advisable for the same reasons I mentioned earlier. Furthermore, training programmes under SPUR are generally affordable. Let us monitor the situation and consider additional help and support in future when the need arises.

I will also address some initiatives to refine the CPF Investment Scheme (CPFIS). Under CPFIS, members can invest their OA and SA savings. But these members must take individual responsibility and accept the risk of their investment choices.

Since 2006, new funds have to fulfil more stringent admission criteria which take into account the fund’s relative rating, track record and expense ratio, before they can be included under CPFIS. Beginning 1st January 2011, CPF Board will require all existing funds under CPFIS to also meet these criteria to be allowed to accept new investments. This is to lower the cost and improve the quality of the funds in CPFIS.

Next, with the implementation of the extra 1% CPF interest rate since 1st April 2008, only monies in excess of $20,000 in the OA and $20,000 in the SA can be invested under CPFIS. Given the higher interest rate on the SA and the uncertainty of CPFIS returns, it is better to be more conservative. Hence, we will raise the threshold of SA from $20,000 to $30,000 effective 1st May 2009. This means that members can only invest

Column: 3231

amounts in the SA in excess of $30,000. Existing investments will be unaffected and the restriction on the first $20,000 in the Ordinary Account (OA) remains unchanged.

Third, Ms Sylvia Lim asked if the floor Minimum Sum payout could be reviewed so that it is comparable to that of the Public Assistance scheme. As has been reiterated before in this House, the CPF system is premised on self-provision and self-reliance. Members can only withdraw what they put into the CPF. This is what makes the CPF system sustainable.

The Minimum Sum Scheme is designed to allow members to receive monthly payouts that will last for 20 years. Increasing the withdrawal amount must mean less for the member in future, that means their savings will not last 20 years, it will be much shorter. Already, many members currently receiving the floor payout of $297 a month would not have enough savings to last the intended 20 years. In fact, with longer life expectancy, we should stretch the payout period further. Raising the floor payout would be irresponsible as it would mean that their savings would run out even faster. By then, these members may be less able to work to support themselves even if they want to.

The Minimum Sum is also not the only asset that CPF members have. In fact, some of them have withdrawn significant portion of their CPF savings when they reached 55 years old. Many would have substantial housing equity in their HDB flats as well and may be eligible for the Lease Buyback Scheme. They can also seek help from their family members, such as through the Minimum Sum Topping-Up Scheme which we have just liberalised further. Those who still face difficulties can approach the CDCs, which will assess

Column: 3232

their situation and see if they are eligible for financial and other assistance.

The CPF system has undergone a set of major reforms in the last two years and will better prepare Singaporeans for the challenges that we face in the future from an ageing population.

The second long-term challenge that our society faces is the impact of globalisation on the lower-skilled workers. While we must press on with our economic strategy to stay globally competitive, we must do our best to ensure that all Singaporeans can enjoy the fruits of our economic progress.

2.45 pm

In 2007, the Workfare Income Supplement (WIS) was introduced as a long-term scheme to supplement the income of low wage workers and build up their CPF savings for long-term needs. Over 300,000 workers benefited from the WIS payment for work performed in 2007, receiving an average $1,000 each. This is a substantial amount.

For 2008, close to 270,000 workers have already received their provisional WIS payment for work done in the first half of last year. More are expected to benefit when the final payments are paid in March and May for employees as well as self-employed persons respectively.

Dr Ahmad Magad suggested that WIS should pay informal workers in cash, and to give greater flexibility to those with less regular employment. I would like to thank Dr Magad for this suggestion. We have done that for the WIS Special Payment which I talked about earlier. But for the regular WIS, we should be more cautious about making changes that could affect work ethic and self-reliance, because unlike the Special Payment, Workfare is a permanent scheme. Nevertheless, we will review the WIS

Column: 3233

scheme in 2010, and will take into account feedback from MPs and others.

During the Budget debate, Mr Christopher de Souza also suggested doing away with the requirement to make Medisave contributions to qualify for WIS. We must remember that the responsibility of looking after one’s retirement and healthcare needs lies first and foremost with the individual worker, even during an economic downturn. Waiving the requirement to make CPF contributions would be sending the wrong message.

Ever since Workfare was introduced, our tripartite partners and grassroots leaders have been hard at work reaching out to the self-employed and informal workers to explain the importance of CPF and encouraging them to contribute to Medisave.

We also introduced the Medisave Contribution Draw as an additional incentive. In fact, the grand draw for workers who had worked in 2007 was held just two days ago. The grand prize winner is a 50-year-old taxi driver; he won $5,000 cash. Over 500 others also won cash prizes ranging from $200 to $3,000. I strongly encourage self-employed and informal workers to make regular Medisave contributions, not just to win the Lucky Draw, but to save up for their healthcare needs. What is more, they can of course qualify for the Medisave Contribution Draw and benefit from Workfare as well; especially since this time the Special Payment will be made in cash.

Sir, we have to continue to help employers and employees prepare for re-employment. We have to continue to help Singaporeans understand CPF LIFE, and to help more members participate in the scheme so that they can benefit from lifelong income. And, we will help and encourage low-wage workers to continue working through Workfare. We cannot wait for better times to deal with these

Column: 3234

important issues. I am confident that with the strong support from our tripartite partners – NTUC, SNEF, SBF and others – we will make good progress on these fronts, even during the downturn.

Contract Workers

Ms Jessica Tan Soon Neo (East Coast): Mr Chairman, there is an increasing trend of organisations moving towards contract employment. In 2008, we saw continued increase of 4.9% of resident employees on term contracts. Contract workers form 12.4% of all resident employees or 180,000. We should note that contract employments are not confined to low-skilled, lower-waged and casual workers. PMETs too are now increasingly becoming part of the pool of contract workers. PMETs now form about half of the resident workforce up from 40% up from a decade ago.

With contract workers becoming an increasing proportion of the resident workforce, ranging from lower-skilled employees to PMETs, does the Ministry track the profile, the type of jobs as well as the length of contract terms for their employment? And is there a look at the progress of whether their welfare and interests are also being taken care of?

The Employment Act that was recently revised in January 2009 extended coverage to include confidential as well as junior managers and executives earning $2,500 and below in basic monthly salary. This enabled them to have access to the Labour Court for salary claims and therefore definitely is a benefit because it allows access to lower cost of dispute resolution mechanisms. Many PMETs do, however, earn more than $2,500, although I do agree that if they are earning more, they should be in a better position to solve their problems. However, having access to Labour Court for disputes would definitely be welcome as many would not be able to afford to

Column: 3235

seek legal advice to handle dispute resolutions with their employers.

Would the Ministry consider increasing the coverage threshold for the Employment Act for PMETs who are on contract terms, say, to about $4,500 a month or any higher than the $2,500 bracket to enable a larger group to have access to the dispute resolution mechanism?

Sir, with the current economic climate we can expect the trend towards more contract workers and therefore we should take care of the interests of contract workers.

Ms Sylvia Lim: Sir, as mentioned by the Member before me, the proportion of resident contract employees last year was a 5% increase over the previous year. Currently, the figure stands at about 189,000 and the number of resident employees on short-term, casual or on-call employment is about 72,000.

Sir, the vulnerability of this group has been well reported. Compared to permanent staff, these workers often have no medical benefits, may not receive CPF contributions and there are usually no retrenchment benefits. As the Government has identified this as an area of weakness, what plans does the Government have to provide more security to this group of workers?

Sir, on the issue of Workfare Income Supplement (WIS) touched on by the Minister earlier, it is already been noted that informal employees will only get the WIS CPF benefits if they contribute significant sums into their MediSave accounts. A year ago, the Senior Parliamentary Secretary told Parliament that this requirement to pay into Medisave is a likely reason why many casual workers did not receive WIS benefits. I would like the Ministry to update us on

Column: 3236

whether the take-up rate for WIS for casual and informal workers has improved since then.

The Chairman: Ms Eunice Olsen has withdrawn. Mr Ong Ah Heng.

Protecting Workers' Welfare – Enforcement on Errant Employers

Mr Ong Ah Heng: ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Foreign workers have contributed much to our economic growth. Sometime ago, our Acting Minister also mentioned that these foreign workers contributed to our economy, whether in constructing HDB flats, apartments, MRT rail tracks or in white collar jobs, or being domestic help and workers who clean our housing estates. We have benefited much from their presence.

Our employers have, on the whole, treated foreign workers well, but there are some foreign workers who are exploited by their employers and are occasionally seeking assistance from MOM.

I am concerned that during this economic downturn, the number of irresponsible employers will increase. We are a nation noted for its rule of law and hence we have laws to protect foreign workers form being ill-treated by their employers.

Since foreign workers’ work permits are approved by MOM. The Ministry should see to it that they are reasonably well looked after. I would like to know if MOM would take more stringent measures to deal with irresponsible employers or their agents. Could MOM consider giving cash awards to whistle-blowers who report irresponsible employers?

I hope more Singaporeans will report to MOM of such unscrupulous companies.

Column: 3237

With the cooperation of all, such employers will be punished by law and prosecuted in courts.

*Cols. 3301-3302.

Foreign Workers

Ms Eunice Elizabeth Olsen (Nominated Member): Sir, while it is true that only a fraction eventually encountered any incident, the Minister has said that the number embroiled in salary spats is expected to rise this year. It is a good time to do more for this group. To begin, the Ministry must know that foreign workers do not enter Singapore on an equal footing as local workers and employment pass or S-pass holders

I read a recent article by NTU researcher Yolanda Chin who wrote that Singapore Utilitarian Immigration Policy evaluates the foreigners' worth based on its usefulness for business. Foreign workers satisfy this criterion by accepting low wages and skeletal rights to keep costs competitive. Besides low wages, another particular aspect of the condition of foreign workers here is that they often incur heavy debts to pay fees to employment agents. So, they start life in our little red dot in the red.

Is there anything that can be done to tackle this aspect of the system? Since companies must apply to the Ministry to secure work permits for its workers, does MOM require that the companies also declare which agents they have used in order to bring in their workers?

Provision of this information could help with early intervention measures if MOM were to be alerted to agents known to be unscrupulous based on past incidents. But early intervention is not the same as prevention. Can MOM work towards a system in which only licensed employment agencies are allowed to recruit foreign workers for companies here?

Column: 3238

Employers also have an important role to play to ensure that workers are treated well. The majority tends to do the right thing but we have read in the media about the few black sheep – those who deny their workers recourse for proper medical treatment, for example. Before the downturn gets worse and more companies may be tempted to cut corners, we should increase the penalties to nip this in the bud. However, some workers will still fall through the cracks. If we expect the numbers to increase this year, how is MOM gearing up to cope with more foreign workers with no money because their salary is being owed, no place to stay because their employers chased them out of their quarters and possibly no contingency job during this downturn? How does MOM propose to tackle the situation?

I can appreciate that MOM officers will be even busier if the number of such cases rise as expected. Since so many public sector agencies have stepped up their hiring plans, would MOM be doing the same? Or is the Ministry suitably staffed and therefore well-positioned to resolve all these cases speedily?

Staffing concerns aside, what is needed more is greater transparency by the Ministry. Last month, the Minister said that on average 85% of cases in the last six months were successfully conciliated within three weeks but he did not elaborate on the various outcomes. Some NGOs have said that the current approach to mediation is for partial compensation. In some cases, workers are asked to pay for half of their airfare home as a result of MOM mediation. Could the Minister please clarify?

Under the Employment of Foreign Manpower Act, employers have the responsibility to pay for the entire fare. This is what the Government requires of the employers of foreign domestic

Column: 3239

workers, are there lesser standards for businesses? Online account suggests that in some cases, MOM officers try to persuade workers not to pursue their claims against their employers. It would be good if the Minister addresses this perception that the Ministry is too pro-business.

Finally, I would like to ask MOM how repatriation companies are regulated. There have been reports, not just online, but in the media about how these companies forcibly take in workers in order to send them home on their companies' behest. How is this not wrongful confinement? How is this not an easy way for companies to keep a lid on issues about salary arrears and non-payment of wages when they can easily call in these repatriation companies to send workers home? In some cases, the workers are said to have been beaten. The system should change so that all workers need to be interviewed by MOM before they return home.

Sir, foreign workers have been in the news as of late and their problems are growing. While it is true that only a fraction eventually encounter any incident, the Minister has said that the number embroiled in salary spats is expected to rise. It is time to do more for this group.

Welfare of Foreign Workers

Dr Ahmad Mohd Magad: Sir, there has been an increased spate of cases of employers who employ foreign workers but who have not adequately looked after their rights and well-being. Some have not paid salaries of their workers and others are negligent in providing suitable accommodation for their workers. The Ministry has rightfully conducted checks and taken some action to deal with such

Column: 3240

violations. However, I feel more needs to be done.

Currently, the Act states that employers who failed to pay their employees can be fined a $5,000 or imprisoned for a term not exceeding six months, or both. Employers who failed to upkeep and maintain their foreign workers can be charged a fine of up to $5,000 per worker.

Sir, to send a strong signal to employers on the need to be responsible in employing foreign workers, I would like to echo what Ms Olsen has said earlier and suggest that the penalties for such violations be increased. Many foreign workers make big sacrifices to come to Singapore to work and when such violations occur, they and their families in their home countries suffer even more. I feel increased penalties are necessary to send a strong signal to employers that have been knowingly negligent in looking after the well-being of foreign workers.

I would like to know how often MOM conducts checks on work and accommodation sites and whether MOM intends to step up on these checks, in consideration of increased incidents lately. These checks are even more critical, now that we are in an economic slum, as some employers may try to cut corners and look for cheaper non-approved accommodation arrangments which may compromise the health and well-being of the workers.

3.00 pm

During this downturn, there are also companies that may be financially squeezed due to delayed projects and poor cashflow and, hence, are generally unable to see to the needs of their workers. Will the Ministry handle genuine cases with a softer touch and step in to advise such companies in seeking alternative arrangement for their workers before things worsen?

Column: 3241

Foreign Manpower Management

Mr Yeo Guat Kwang (Aljunied): Sir, the labour movement here is concerned about the welfare of all workers, both local and foreign. We recognise the need to attract foreign workers to work in Singapore in order to supplement our workforce.

Unlike many other countries, in Singapore, our Employment Act gives legal protection to all workers, both foreigners and locals. However, MOM should step up its enforcement. For instance, more foreign workers will be out of jobs and be sent back with the economic recession. MOM has to ensure that the employers would not send the workers back home before their salary or accident disputes can come to light or be settled. When it comes to the treatment of foreign workers, we need a set of good practices. They are companies that do it right and there are some doing terribly wrong. As the downturn worsens, there is a risk that some employers may treat workers unfairly or not pay them using the economic downturn as an excuse. We should not let employers exploit the downturn and not pay the workers or treat their workers unfairly. I hope that the Ministry could play a more active role to strengthen the tripartite collaboration in promoting good employment practices and the general well-being of the foreign workers. I also wish to know whether the Ministry has plans to address the issue of accommodation and social needs of foreign workers in Singapore.

Sir, in fact, the key reason for foreign workers' problem is the hefty sum that they have to pay before they come to Singapore. Many of them told us that they have to pay their agent at home up to more than S$8,000 to come here. So they have no choice but to jeopardise their own health and safety by working as much as they can to recover the fees. This has to stop. I hope MOM could take

Column: 3242

this issue up with the governments of sending countries to see what more we can do.

Moving forward, we should further strengthen the control on local employment agents and contractors as well, as it is so easy to form a company in Singapore. These employers, contractors or the employment agents should also not be allowed to float multiple or different companies in order to get around the black list.

I would also like to request MOM to monitor closely and step up efforts in raising the employment rate of Singaporeans at the same time, particularly older workers and women. I think we need to educate the HR practitioners and management to change their mindset against matured workers. We also need to place more emphasis on encouraging Singaporeans to consider jobs in the services sector because we cannot be too much dependent on foreign workers for the services sector in future.

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

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

Mr Speaker: Order. I suspend the Sitting and will take the Chair again at 3.25 pm.

Sitting accordingly suspended

at 3.03 pm until 3.25 pm.

Sitting resumed at 3.25 pm

[Mr Speaker in the Chair]:

[Mr Speaker in the Chair]: Debate in Committee of Supply resumed.

[Mr Speaker in the Chair]

Head S (cont.) –

Column: 3243

Mandatory Day-off for Maids

Mr Siew Kum Hong (Nominated Member): Sir, this is an issue that has been raised repeatedly, but I would still like to renew the call for foreign domestic workers to be given a mandatory day-off.

We have, in the past, heard numerous reasons from employers against giving maids a day-off. Many of them centred around the $5,000 security bond, which many employers fear losing if the maid runs off, contracts a sexually transmitted disease, or even gets pregnant. These are the result of two factors: firstly, the terms of the security bond are onerous, making the employer responsible for almost everything that happens to or is done by his maid; and secondly, many employers are not aware that MOM's practice is to forfeit the security bond only if the maid is not sent home after her work permit is cancelled. So even if the maid does get up to mischief, that does not automatically mean a forfeiture.

Other reasons reflect plain selfishness, such as those who say that they work all week and do not want to have to do housework on the weekends, or those with children or ailing parents who want their maids to continue looking after them on weekends. These employers seem incapable of putting themselves in their maids' shoes; just as they want to rest, the maid also needs rest as well. Maids are not robots or machines – and even machines need downtime for maintenance and repair, let alone human beings.

Having a rest-day is a basic human right. The Employment Act prescribes minimum rest days for workers, but maids are deemed to be somehow different. They do not even get one day off a month. They are excluded from these rights under the Employment Act, and their rights under the Employment of Foreign Manpower Act are kept generic

Column: 3244

and are not clearly defined, as opposed to the Employment Act which is quite specific.

But it is not just a question of rights. A day-off has other benefits as well. It improves the morale and productivity of the maid, as well as the relationship with the employer. The maid also gets a chance to learn other skills, and some NGOs have been making laudable efforts here. Finally, a day-off makes it more unlikely that maid abuse can continue for extended periods without being discovered, which has happened from time to time.

In 2006, a standard contract was introduced. But – and this has been pointed out repeatedly – this standard contract does not mandate a rest-day. Instead, while different forms do provide for a day-off a week or a month, this right can be waived in return for monetary compensation to the maid, which I understand is usually the sum of $15 to $20 each month. I am not sure we can find any working Singaporeans who would willingly give up all of their Sundays for an extra $15 to $20 per month. Given the dynamics of the employer-maid relationship, it is quite inconceivable that the maids willingly trade their day-off for this amount, as opposed to feeling compelled to do so for fear of being rejected or sent back by their employer otherwise.

In comparison, maids in Hong Kong are entitled, by law, to one day-off every week and also to public holidays. Are maids in Hong Kong somehow different from maids in Singapore? Are employers in Hong Kong somehow different from employers in Singapore? I seriously doubt it.

Sir, I think the lack of progress in this area is really due to a lack of political will to make the difficult decision. It is a difficult decision because it will invariably

Column: 3245

make some employers unhappy. But it does seem that popular opinion amongst Singaporeans may be in favour of a mandatory day-off for maids. A poll by the Sunday Times last July found that 81% of 230 respondents thought that maids should get a mandatory day-off. That being the case, I hope that the Acting Minister would reconsider the existing position and introduce a mandatory day-off, at least once a month, which I feel should not be contentious for foreign domestic workers.

Workplace Safety and Health

Mr Ong Ah Heng: ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Sir, in Singapore, workplace safety and health is very important. The passage of "Workplace Safety and Health Act" aims to ensure our workers are equipped with safety gears to prevent workplace accidents. Those employers who run afoul of the law will be severely dealt with. For instance, there were some industrial mishaps at the worksite of company called Da Di Engineering. Though there was no fatality, the company was fined $132,000.

I was told by some construction workers that one safety officer usually looks after two to three construction sites. The smaller company could only hire part-time safety officers. If such is the case, the worksite safety will be compromised and workplace accidents are bound to happen.

In July last year, in the maritime industrial sector, there were seven fatal accidents within two weeks. In August last year, one worker was electrocuted in a shipyard in Tuas. Other accidents involved workers who lost their limbs when the parts of the crane they were on fell apart. Though the rate of industrial accident is 2.9% among 10,000 workers, it is an improvement over the past.

Column: 3246

I agree with Prime Minister that it is not good enough. We should improve it to 2.5% among 10,000 workers by 2015. Can MOM tell us how they are going to achieve this so as to make Singapore a country with the safest work environment?

*Cols. 3303-3304.

Mr Yeo Guat Kwang: Sir, the total number of deaths in work accidents in 2008 is 67; and over the last one week, we saw another two workers die in workplace accidents.

Sir, all such accidents are preventable and the learning points are not new. And that if more had been done, we could have prevented all these accidents from happening. The workers need not have died. To us, every case is one case too many.

It is imperative for, not just the Government, but all stakeholders, particularly the employers, to put their act together to make our workplaces safer for all our workers. Could the Ministry expedite the process to make all workplaces covered by the new Workplace Safety and Health Act?

In order for industry to have sufficient time to prepare and meet the requirement under this new Act, we should also activate the tripartite network to work out more practical solutions and measures to address all the occupational health and safety risks in all these workplaces. In particular, we are trying to cover more workplaces that have not been covered under the Factories Act in the past.

I hope MOM could also consider providing incentives and facilitating more industry-driven WSH initiatives to improve the safety standard in all our workplaces.

I would like to ask the Ministry for an update on the progress made so far in improving our workplace safety and health

Column: 3247

performance after the new Act has been put in place. Do we see significant improvements in safety and health standards since the formation of the new Workplace Safety and Health Council under the new Act?

Workplace Health and Training

Dr Fatimah Lateef (Marine Parade): Sir, in Singapore the new commonest areas for cardiac arrests to occur would be the home and the workplace.

Indeed, many adults who are working have many risk factors for coronary artery disease and other chronic illnesses. Most workplaces have some form of a simple first-aid box. And there are others in certain industries where it is a requirement to have an industrial officer or a supervisor or even an industrial nurse on site.

In the course of my work, I have come across many cases of cardiac arrests sustained at work where very little has been done upfront. Can the Ministry consider providing workers in all industries with some form of first-aid training? And perhaps specific supervisors can be trained in CPR and also AED skills?

As Health Promotion Board also has a division called the Healthy Living @ Work, perhaps MOM can consider some form of collaboration with MOH and HPB?

Promotion of Flexible Work Arrangements

Mr Ong Ah Heng: ( In Mandarin ): [For vernacular speech, please refer to Appendix A.] Sir, according to a local newspaper report, out of 10 companies in Singapore, one of them would adopt flexible work arrangement, such as allowing the employees to work from home, on a part-time basis or by shifts. Last year, 7.4% of the companies

Column: 3248

adopted various types of flexible work arrangement, an improvement over the 5.1% two years ago.

The Government's support of women retaining in the workforce has made significant progress. The Government is allocating $20 million to promote work-life balance, among which $3 million is set aside to provide for flexible work arrangement for the women. We should learn from the developed countries where women are encouraged to return to the workforce. The employers should endeavour to arrange for more flexible jobs.

Compared to Japan, USA and Korea, our older workers' participation in the workforce is also inferior. In Japan and Korea, 80% of male workers aged 55 to 64 remain in the workforce; in Singapore it is only 65%.

If the economic downturn gets worse, I fear that more companies will be reluctant to promote work-life balance, and reduce the employment of older workers. I hope I am wrong, but I would urge MOM to look into this matter.

*Cols. 3305-3306.

Mr Seah Kian Peng (Marine Parade): Sir, thank you for the honour of filing the last cut for this year's COS debate. I would like to use this time to pursue an old hobby horse. But first, let me declare my interest as a board member of Centre for Fathering.

Last August, the Government has said that there was no need to introduce Paternity Leave as working fathers will benefit from two leave entitlements from the enhanced Marriage and Parenthood Package. That is six days of paid childcare leave plus six days of unpaid infant care leave per parent per year.

In granting fathers this leave entitlement, which I support, the Government has signalled its recognition of the

Column: 3249

importance of working fathers' role in raising children. But I am not at all convinced that this is enough for someone who views parenting as a shared responsibility – a role that has been consistently advanced by our various Ministers. But, to me, it remains more words than action.

I am sure all of us have received much feedback from friends and relatives, instances where many working fathers have to take extra days of leave just to handle the entire birth process – from running errands to and from hospital, assisting their wives to settle in with the newborn. A bonus if the wife gives birth on a Saturday because it saves two working days. Not so good if your newborn suffers from jaundice – another day required to make a trip to hospital to fetch the baby after recovery.

Hence, rather than imposing a strict four months' maternity leave to mothers and giving fathers just three days, I ask the Government to grant some flexibility to each set of parents to apportion their leave at their discretion. Such a proposal gives more power to the couple to decide for themselves.

Sir, I will argue that this personal choice allows us to increase the total sum of happiness at no extra costs. There seems no reason why we should not do it. The only reason I can think of not doing it is purely on administrative grounds. But surely this is not a good enough reason. If we believe this is a right policy, I am sure we can find a way out. This change in policy will help us to take a step forward in building stronger resilient families. It may even provide a fillip to our population woes.

At a time of uncertainty and social pressure, family needs more mothers and fathers even more. Encouraging fathers to take on caring roles and joint responsibilities with their wives towards

Column: 3250

their newborns is vital, if we are serious about enabling both parents to realise their full potential at home and at work. So, Sir, I hope the Ministry can put this as a high priority item on their To-Do list.

The Senior Parliamentary Secretary to the Acting Minister for Manpower and Minister for Health (Mr Hawazi Daipi): Sir, the Acting Minister for Manpower has spoken comprehensively about our manpower strategies to deal with the current economic downturn as well as to address our long-term challenges. I shall elaborate on our efforts to enhance workplace standards and build progressive workplaces, both of which will help maximise the potential of our workforce.

Let me first deal with the issue of workplace safety and health (WSH). Mr Ong Ah Heng and Mr Yeo Guat Kwang have enquired on efforts to improve safety and health at work. Over the past few years, my Ministry of Manpower (MOM) has made significant progress in raising WSH standards in Singapore, in collaboration with industry partners such as the WSH Council and the various industry associations.

The industry-led WSH Council has launched many efforts to improve safety outcomes since its formation in April 2008. The Council has led the way to establish appropriate WSH standards for the industry through publishing resources like technical advisories, compliance assistance checklists as well as guidelines. It administers two key initiatives targeted at SMEs: first, the Risk Management Assistance Fund helps SMEs defray the cost of consultancy projects to build in-house capabilities in risk assessment. Here, some $4.6 million has been disbursed to companies to date. Meanwhile, bizSAFE is a five-step approach to raise SME’s capabilities in managing WSH and has garnered some 2,000 participants to date. The Council has also launched numerous outreach

Column: 3251

initiatives to raise awareness of safety and health issues, targeting the general workforce as well as the public, WSH professionals and top management.

The decline in the workplace fatality rate from 4.9 per 100,000 workers in 2004 to 2.8 per 100,000 workers in 2008 is a testament to these improved standards and initiatives. But we can definitely do better. In April 2008, the Prime Minister announced a new national target to bring our workplace fatalities to less than 1.8 per 100,000 workers by 2018. I think Mr Ong Ah Heng would like to take note of this.

To achieve this target, my Ministry, together with the WSH Council, is drafting a new national plan for WSH, known as WSH 2018. We have consulted industry stakeholders on the specific proposals and initiatives under the plan. WSH 2018 will be unveiled in April at this year’s National Workplace Safety and Health Campaign.

Let me give the House a flavour of what can be expected under WSH 2018. We will be developing and refining roadmaps for key sectors which have seen a relatively high number of accidents. This includes the marine and construction sectors, which have had several high-profile accidents recently as pointed out by Mr Ong Ah Heng and Mr Yeo Guat Kwang. These roadmaps will outline strategies and initiatives tailored to address specific WSH challenges facing each sector. They will also include sectoral targets to help us track our progress. We also plan to raise safety standards in other less risky sectors. As MOM prepares to extend the Workplace Safety and Health Act to cover all workplaces, I welcome Mr Yeo Guat Kwang's suggestion to activate the tripartite network to help us in our outreach and other consultations.

Column: 3252

Growing the pool of WSH professionals is key to achieving our new WSH target. Our aim is to increase the number of WSH professionals, such as WSH Coordinators, Officers and Auditors, by 3,000 annually. This will give us a pool of some 19,000 WSH professionals by 2018.

The WSH Council has helped to develop a national Workforce Skills Qualifications (WSQ) Competency Framework for WSH Professionals and for certain trades in the marine industry. We are now capitalising on SPUR to increase the number of training places under the WSQ framework. We will be increasing the capacity of our training courses for WSH Representatives and Coordinators to 2,000. Not only will this allow us to help existing WSH professionals upgrade their skills and qualifications, it also provides many good career opportunities to people looking to enter the profession.

Mr Ong has also spoken about the role of safety officers. Currently workplaces in riskier sectors such as the marine, construction, manufacturing and oil and petrochemicals industries must appoint a workplace safety and health officer. His role is to assist employers to identify and assess risks at the workplace and work processes, and to recommend measures to reduce these risks.

However, risk management is effective insofar as the recommendations to reduce risk are properly implemented. While the safety officer does play a role in the proper implementation of risk management measures, workers and their supervisors on the ground must also do their part in ensuring safety outcomes.Therefore, one of the key thrusts of WSH 2018 is building a progressive and pervasive safety culture, by emphasising the individual’s responsibility for ensuring his own safety and those around him. This is an issue which Mr Ong Ah Heng

Column: 3253

raised in a Parliamentary Question at a last sitting before our COS debate.

3.45 pm

Specifically, Dr Fatimah Lateef has also spoken about enhancing first aid training in workplace. Under the Workplace Safety and Health Act, employers are required to develop and implement emergency response procedures, including first-aid facilities. The WSH (First Aid) Regulations require all factories, airports, ships in harbours and laboratories to put in place first-aid facilities and measures such as the appointment and training of first-aiders. These are workplaces where first-aid assistance is more likely to be needed, and for which it makes more sense to prescribe the minimum first aid facilities and measures to be provided.

First-aiders in these workplaces can range from industrial nurses to rank and file workers. They must undergo an Occupational First Aid Course approved by MOM which includes training in CPR but not in Automatic External Defibrillators (AED) skills. MOM, however, welcomes the suggestion to do so and will explore this when we next review the requirements for the first aid course.

Sir, let me now move to fair and progressive workplace practices and talk about Flexi-Works! and the WoW! Fund. Mr Ong Ah Heng has raised a valid concern regarding the employment of older workers and women during the current recession. We had made good progress on this front. The improvement in employment rate in 2008 resulted mainly from more older people and females taking up employment.

To help companies improve their workplaces to better meet the needs of older workers, women and other workers, we currently have two funding programmes. The first is the Work-Life Works

Column: 3254

(WoW!) Fund, which helps employers introduce work-life measures at the workplace, with a focus on flexible work arrangements. The second is Flexi-Works!, which is targeted at bringing economically inactive individuals back to the workforce by encouraging companies to offer them part-time employment and other flexible work arrangements.

Employers and workers will be happy to hear that with effect from 1st March this year, we will enhance both programmes. We will double the maximum grant from WoW! Fund from $10,000 per company to $20,000. We will also extend Flexi-Works! for another year, with a budget of $3 million, and lower the qualifying age of recruited workers from 35 to 30 years of age, in order for the company to be eligible for the grant. We hope that this will encourage companies to recruit more women who may have left the workforce but seek to return before the age of 35.

As both programmes help enable companies to implement flexible work arrangements, the Flexi-Works! and WoW! Fund will be streamlined as part of the enhancements in March. The two programmes will share a common first tranche funding of $10,000 for employers to provide flexible work arrangements. Subsequently, applicants can either apply for an additional $10,000 under the WoW! Fund to develop integrated Work-Life processes, or tap on Flexi-Works! for an additional $90,000 to recruit and retain economically inactive persons above the age of 30, or both.

My Ministry also supports other initiatives geared towards encouraging the employment of women. The Tripartite Workgroup on Enhancing Employment Choices for Women, led by Mdm Halimah Yacob of the National Trades Union Congress (NTUC), has successfully placed more than 2,300 women in jobs over the past year. The "Step Out For Change"

Column: 3255

programme was launched in July last year to help women return to work. Through workshops on personal effectiveness and confidence building, this programme has already benefited 167 participants to date.

As we recognise the contributions of women in the workplace, we also recognise the role of fathers at home. I thank Mr Seah Kian Peng for sharing his passionate views on granting an official period of paternity leave to fathers. I agree with Mr Seah that parenting is a shared responsibility and that fathers play an important role in raising children. Therefore, the Government has already put in place measures to allow working fathers to spend more time with their children, including raising childcare leave from two to six days, and introducing six days of unpaid infant care leave as part of the enhanced Marriage and Parenthood (M&P) package. These are generous additions to the leave entitlements of working fathers, from two days to up to 12 days of leave per year under the new package.

Mr Seah has suggested that the Government also allows parents the flexibility to apportion their leave entitlements. However, this would contribute to manpower uncertainty for employers as they would not know how many days of leave each parent intends to take. This would ultimately add to business costs for employers and I would caution against imposing an additional burden on employers in this current economic climate.

We believe that the recently introduced M&P measures are sufficient for now, but the Government will study the impact of the package and periodically refine our M&P policies with feedback from stakeholders. So if Mr Seah likes,

Column: 3256

he can bring up this matter again next year.

On responsible employment practices in this downturn, Mr Ong Ah Heng has raised concerns that local workers should be treated fairly and responsibly. I would like to thank Mr Ong Ah Heng for his suggestions and remind companies of their obligations to their workers under existing agreements.

Ms Jessica Tan also suggested covering executives earning more than $2,500 in the Employment Act. We have just amended and implemented amendments to the Employment Act from 1st January 2009, which allow executives earning up to $2,500 a month to pursue salary claims at the Labour Court at MOM. We will monitor the developments and consider at a later stage the suggestions to include executives earning more than $2,500. Notwithstanding this, executives who earn more than $2,500 a month could still make use of the MOM's conciliation services to settle their salary disputes with their employers.

As the economy slows down, we will also need to do more for low-wage and vulnerable workers, who are likely to be most affected by the downturn. The pool of resident employees on term contracts has increased by 4.9% since 2007 to 189,100 in 2008. They formed 12.4% of all resident employees – Singaporeans and Permanent Residents. Both Ms Jessica Tan and Ms Sylvia Lim have called for further protection concerning employment and income security for this group. Mr Christopher de Souza has also raised the issue of ensuring CPF contributions to eligible contract workers during the Budget debate. Contract employees are covered under the CPF Act, Employment Act and other employment laws. In line with the general trend for shorter employment tenures, the Ministry amended the Employment Act to reduce the qualifying period for maternity leave

Column: 3257

and sick leave. This is one way to help our workers better safeguarded and enhance their welfare.

Since the employment standards of some low-wage contract workers are tied to outsourcing contracts, the Tripartite Committee on CPF and Work Related Benefits for Low-wage Workers released a "Tripartite Advisory on Responsible Outsourcing Practices" in March last year to enhance these standards. Since its launch, MOM, NTUC and SNEF have been actively promoting the adoption of the Advisory to over 1,000 employers, service buyers, managing agents and labour suppliers. The process is going on, and the Tripartite Committee will reach out to even more employers. MOM has also been helping Town Councils and other public sector agencies to implement responsible outsourcing practices. Moving ahead, we will extend our outreach to other private sector companies.

MOM and CPF Board regularly remind employers and employees on their obligations to comply with rules on CPF contributions and statutory employment rights and benefits. This includes newsletters published in major newspapers to inform the public of rules under the CPF and Employment Act governing the payment of salaries, CPF contributions, leave and overtime.

MOM and CPF Board take a serious view of the late payment of salaries and non-payment of CPF contributions, and non-compliance with statutory employment benefits, and have stepped up enforcement efforts. In 2008, MOM prosecuted 24 employers for Employment Act violations, while CPF Board prosecuted 218 errant employers and officers of companies. Between January 2007 and September 2008, CPF Board’s audit efforts led to close to 48,000 informal workers being converted to formal employment, which enabled them to receive CPF contributions. I think, in a way, this responds to Ms Sylvia Lim's

Column: 3258

concern over how we help contract workers and casual workers to be better protected in terms of salary and wage benefits.

Ms Lim has asked whether contract workers will be able to benefit from the various employment assistance programmes offered by the Government. I would like to assure Ms Lim that contract workers are not disadvantaged in this regard. As mentioned by the Acting Minister for Manpower, we have in fact made it easier for workers, including contract workers, to qualify for the Special Payment under the Workfare Income Supplement (WIS) scheme, on top of the regular WIS payments they will receive. Contract workers are also eligible for training opportunities offered by the Workforce Development Agency (WDA), including SPUR courses.

I will now turn to the management of foreign workers. Both Ms Eunice Olsen and Mr Yeo Guat Kwang have raised the issue of basic labour rights and recourse for foreign workers. Dr Ahmad Magad and Mr Yeo have also raised concerns on the need to help foreign workers who have been unfairly treated by employers. My Ministry is tackling this issue on several fronts: education, enforcement and social support.

First, education. Like local workers, foreign workers working in Singapore, except those in domestic work, are also protected under the Employment Act. The Employment of Foreign Manpower Act also requires employers to provide acceptable accommodation and medical care for their workers. We have increased awareness on basic labour rights and sources of help through several levels, such as distributing a handbook to new workers in their native languages and organising regular dormitory roadshows to educate workers beyond workplace safety and health issues. Sir, these are the kind of booklets that we issue to foreign

Column: 3259

workers [ indicating ] who have just arrived in Singapore, and their basic rights are listed out here with illustrations in their own native language. Workers from the construction and marine sectors are also educated on their rights at orientation courses upon arrival in Singapore.

Second, enforcement. To prevent exploitation of workers, MOM imposes measures in the work pass approval process to minimise the possibility of workers being brought in without jobs. For instance, construction and marine companies, including sub-contractors, need to show documentary proof that they have ongoing projects before work permits are issued. If employers face an unexpected project cancellation or delay, they should terminate the workers’ contracts and facilitate their repatriation after ensuring that all outstanding employment issues have been resolved.

To prevent employers from reneging on their salary obligations, my Ministry has put in place early intervention measures to detect non-payment of salaries. For example, MOM monitors employers who default on levy payments, and works with housing operators to gather information on employers who default on their rental payments. MOM is also stepping up inspections at foreign workers’ dormitories to ensure that acceptable accommodation and the needs of foreign workers are being taken care of, and to
check if they face salary arrears problems. MOM checked some 800 premises for unacceptable accommodation last year.

4.00 pm

If a worker makes a valid salary claim, MOM will step in to help them recover their outstanding salaries. I wish to assure Mr Yeo that the Government does not send foreign workers home before their

Column: 3260

cases are resolved. If the case is more complex and cannot be resolved within seven days after permit cancellation, the worker is allowed to stay in Singapore under a Special Pass to resolve his claim. Ms Eunice Olsen has enquired about the regulation of repatriation companies. MOM has an arrangement with the Immigration and Checkpoint Authority (ICA), such that, should the employer attempt to send the foreign worker with outstanding employment issues home, usually through a repatriation company, the foreign worker can inform the immigration officer. The worker will not be sent home and will be referred to MOM for assistance and our officers will help them.

My Ministry will investigate and take action against errant Singapore employment agencies and employers who flout our laws and regulations. To illustrate a recent case, MOM will be pursuing charges against marine company, Tipper Corp., for the illegal deployment of their workers as well as for failure to pay salaries to the workers. Dr Ahmad Magad has queried whether we can consider increasing the penalties for employers. The House may recall that the penalty for non-payment of salaries under the Employment Act has been increased to $5,000 per charge for first-time offenders since January this year for greater deterrence. The penalties for offences under the Employment of Foreign Manpower Act were also recently raised in 2007. MOM can also debar errant employers from hiring foreign workers. This debarment will also apply to any company in which the employer is involved. So it is just not the company but also the employers.

Ms Eunice Olsen and Ms Denise Phua have asked whether the Government can do more to regulate the agents used to bringing in foreign workers. MOM currently revokes the licences of local employment agencies who flout the

Column: 3261

licence conditions, for example, by offering kickbacks to employers for the employment of a foreign worker. Such employment agencies will also lose their security deposits or up to $20,000. The Employment Agencies Act also dictates caps on the amount that workers and employers can be charged for a placement. Many Singapore employers or employment agencies also use the services of foreign agents to conduct their recruitment in source countries. However, it is difficult for MOM to determine that a particular overseas employment agency has been involved in a particular work permit application or to control their actions since the recruitment process takes place outside our jurisdiction.

Ms Denise Phua rightly pointed out earlier that the root cause of foreign workers' woes often lies in the countries of origin. My Ministry will continue to engage embassies of labour source countries to resolve problems faced by their nationals working in Singapore and to safeguard their well being. We share with these embassies relevant information obtained during the course of investigations, including information on employment agencies in source countries who may be exploiting workers. The embassies can disseminate this information to the relevant authorities back home so that action can be taken against the errant parties in the source countries and that their nationals can be educated on how to avoid falling victim to scams. However, the House must be aware that there are limits to what MOM can realistically achieve in a foreign jurisdiction.

The third area I want to talk about is social support for foreign workers. My Ministry strongly supports the efforts of NTUC and SNEF, who have jointly set up the Migrant Workers Forum to be ready by April. The Forum aims to develop a social support infrastructure for foreign

Column: 3262

workers and promote good employment practices towards foreign workers. There will be a contact point and a hotline to ensure that foreign workers have access to advice on employment rights and how to seek help if they need it. Where MOM’s mediation is sought, the Migrant Workers Forum will refer these cases to the Ministry for help. The Forum will take an active role in providing humanitarian assistance so that workers are not left stranded with no food or shelter. They will also be organising basic training in areas like English and social activities to help foreign workers live in this country in harmony with our citizens. The Forum will also seek feedback from employers about foreign worker management issues.

Sir, on foreign domestic workers, Mr Siew Kum Hong has asked about passing regulations to mandate that Foreign Domestic Workers (FDWs) be given at least one day off per month. My Ministry is committed to safeguarding the well-being of Foreign Domestic Workers in Singapore. As part of the Work Permit conditions, employers are responsible for the well-being of their domestic workers, including the provision of adequate rest and day or days off in accordance with the employment contract.

Since 2006, all accredited employment agencies have been required to use a standard employment contract for their foreign domestic workers, stipulating a minimum of one rest day per month. Should the foreign domestic worker prefer to work during her rest day, the standard contract requires employers to compensate an agreed amount in cash which must be stipulated in the employment contract. Employment agencies who do not meet the accreditation criteria, including the use of this standard contract, will not be allowed to renew their licences.

MOM encourages employers to grant foreign domestic workers rest days

Column: 3263

regularly if possible. However, our current approach of not mandating a fixed number of rest days per month for foreign domestic workers recognises the unique nature of domestic work. Households that have, for example, elderly or disabled family members who require constant attention may find it difficult to release the foreign domestic worker for a prescribed period every month. Some foreign domestic workers may have other arrangements for daily rest periods or prefer to receive additional compensation over having a rest day. Therefore, allowing households to work out an employment arrangement with their foreign domestic workers is a more flexible approach.

Sir, in conclusion, our efforts in building progressive workplaces will enable our labour market to be better positioned to meet the challenges of the changing economy in the long term. While we need to ensure that basic standards of employment such as safety and health are complied with, we also need to put in place fair and progressive employment practices, which continue to be important in times of uncertainty like this, as well as a well-managed foreign workforce in Singapore. If we can achieve all of these, I am confident that we will be able to make Singapore a great place to work.

The Chairman: Mdm Halimah.

Mdm Halimah Yacob: Sir, I would like to seek two clarifications from the Minister. First, now that we have the tripartite guidelines on managing excess manpower, I would like to ask the Minister how does the Ministry intend to ensure that the non-unionised companies adhere to the principles of the tripartite guidelines because for the unionised companies, we can at least work directly with the companies but, in the non-

Column: 3264

unionised companies I reckon that that would be a problem and that would affect the ability to save jobs.

My second question is to ask the Minister whether he would reveal the quota for S-Passes, because the S-Passes is a very attractive category of Passes. Salary threshold is low – $1,800, much lower than the P-Passes but at the same time, it does not have the restriction of the Work Permit-Passes where it is subjected to a two-year term. Also, they cannot bring their families. Therefore, it is a very attractive category of Passes but yet at the same time, it is also a category of Pass holders that will come into direct conflict, competition with the PMETs now that we have a lot more PMETs who are looking for jobs. Can the Ministry review the current quota for S-Passes?

Mr Gan Kim Yong: Sir, in reply to Mdm Halimah's question on tripartite guidelines on managing excess manpower. Today we have a tripartite collaboration with SNEF as well as NTUC. For those who are not unionised, we will continue to work through SNEF through their employers as well as SPF through their employers federation. At the same time we also be working with the companies directly because as companies face difficulties, when they need to retrench their workers, we also have an understanding that they will inform us. And when these companies inform us of their intention to retrench workers or when they inform us that they are facing problems, difficulties with their businesses, we will then work with them through the problems and we will also introduce them to the tripartite guidelines. It is also important for us to continue to organise outreach programmes to reach out to companies which are not unionised so that they too will be familiar with various options that are available under the tripartite guidelines for managing excess manpower. I think it is work that we need to continue to do and we will

Column: 3265

look forward to working together with SNEF as well as companies that are facing difficulties.

For S-Passes that the Member has mentioned, I mentioned in my speech earlier that we would be tightening the criteria for S-Passes in order for us to improve the quality of S-Pass workers coming to Singapore. It was introduced a few years ago to allow companies to have more flexibility to have access to higher skilled workers, especially those with diplomas and high school qualifications. And now, we need to tighten the requirements so that we want to ensure that S-Pass workers who come to Singapore have a set of certain skills that we need, of certain qualifications that we are looking for. So I think we will continue to tighten that.

Dr Lim Wee Kiak: Sir, I have three points of clarification. First of all, the Minister mentioned that the website at WDA has been centralised and that all the information is available. But I think residents still find it very confusing. Is it CDC, is it e2i, is it WDA or is it CDAC, Mendaki or Sinda when looking for a job? So I hope the Ministry can look into how do you centralise all these information and advise residents accordingly.

The second point is regarding the Professional Conversion Programme (PCP). It was launched two years ago, on 27th March 2007, and it was stated that their target was to train 1,000 PMETs at the point in time – to spend over $20 million of Government funds. But the Minister has just announced that over the last two years, we only have 500 over that was being trained. I would like to ask the Minister what accounted for this shortfall? What are the difficulties that is facing this PCP programme now? Is it because the allowance is too low, causing residents not to take it up? And what are the measures being taken to boost the conversion rates of PCP?

Column: 3266

Last of all is the PCF. While I am heartened that the Government did not lower the PCF rate for this recession unlike previous recession, I am just requesting whether we can tweak the contributory rates to the Ordinary Account and the Special Account. In times like this, can the contribution rate to the Special Account be lowered so that more can go to the Ordinary Account to help with their home mortgages?

Mr Gan Kim Yong: I think the Member means CPF. First and foremost, in terms of assistance given to residents. Many institutions are available to them. They can go to CDCs, they can go to the Continuing Education & Training Centres (CETC) if they know specifically which particular industry they are interested in. They can also go to NTUC's e2i if they are familiar with e2i. But I would imagine that most residents will be more familiar with CDC where they used to go to for assistance. And of course if all else fails, they can always go to the MPs for help and MPs can then refer them to CDCs or the relevant institutions. So I would suggest that for residents who need help, the most convenient point would be the CDCs for them.

Dr Lim Wee Kiak: Are the CDCs and the e2i in communication?

Mr Gan Kim Yong: Of course, yes. Certainly, as I mentioned in my speech earlier on, we have already linked up all the data among all these institutions so that when you go to anyone of them, they will be able to make referrals effectively.

Second question on PCP. Over the last two years, the economy has been growing very rapidly and training has been very difficult to promote because people are short of time, short of workers and therefore there have been some difficulties and some friction.On top of

Column: 3267

that, PCP, in particular, is not an easy programme because it involves conversion, meaning we are looking at people who want to switch jobs from one career to another, going into an industry that they may not be familiar with. It is like going back to school. For many of them, their mindset needs to be changed. And we are making progress in helping them overcome this change of mindset. We are now seeing more workers coming forward to join us in our training programmes, especially during the downturn. This is encouraging. I have earlier on given some indication of how many were on our SPUR programme.

4.15 pm

On the last point on CPF contribution rate, I have also explained in my answer that to tweak the contribution rate and allow more to be drawn out to pay for housing may, in the long term, undermine the retirement adequacy. It is more important for us to help them through many other different schemes. MND has just recently announced several measures to help needy residents who are unable to service their housing loans, including the Lease Buyback Scheme. We have sufficient help schemes for them. And if they have financial difficulties, we will be very willing to look at them. There are the CDCs, ComCare and many other schemes which will be available to them.

Dr Ahmad Mohd Magad: Sir, one issue that I feel has not been sufficiently addressed by the Acting Minister is the plight of PMETs, as raised by hon. Members Dr Lily Neo, Mrs Josephine Teo and myself earlier. I have asked for the Minister's consideration of an additional Jobs Credit subsidy of 6% for income portion above $2,500 but capped at $4,000, which I believe will go some way in saving more jobs in the PMET category. May I ask the Minister whether the

Column: 3268

Government could consider this proposal to help arrest the retrenchment of PMETs which is occurring at a rapid pace? A job saved translates to one less hardship problem and one less potential social problem of an entire family.

Mr Gan Kim Yong: I would like to thank Dr Ahmad Magad for his comments and suggestion. I think it is a very good suggestion. But as the Minister for Finance has explained earlier, the whole Resilience Package was designed on the basis that we want to keep it simple and effective so that we could extend the help and support for the businesses and workers as soon as possible. It is for this reason that we have kept the Resilience Package simple and easy to implement. It is for the same reason that we have kept Jobs Credit very simple. Even for the PMETs, they will also be entitled to the 12%, up to $2,500. The $2,500 benchmark is actually our median wage and it is already catering to the middle-income group. Therefore, it is not necessary for us for the time being to think about another tier. Also, the Finance Minister explained that there is a trade-off with the given package. If you want to give more to PMETs, we will then end up in having a trade-off to give less to the rest of the workers. Therefore, on balance, Dr Magad's suggestion has merits, but we have decided to go on a simple package, focusing on the middle and lower-income of up to $2,500. I think that is most effective in helping to save jobs, especially for this group of workers.

Mrs Josephine Teo: I thank the Minister for his positive responses to my suggestions. In the previous downturns, the number of non-Singaporeans in our workforce had shrunk and, anecdotally, in the unionised sector, we know that companies are not renewing the contracts of some of their foreign workers. Would it be possible for MOM to share with us at this point in time how the non-Singaporean workforce has changed in

Column: 3269

terms of numbers, since the last quarter of 2008? I think this would provide some reassurance to Singaporeans that, indeed, the number ebbs and flows according to the economic conditions.

Mr Gan Kim Yong: The detailed breakdown of foreign/local workforce data would be available when we have completed our annual labour force survey. I would ask for Members' indulgence and wait for the data to come by. But from anecdotal feedback, we do see a mix of local and foreign workers being affected. Some foreign workers, as the Member rightly pointed out, were not retrenched but their contracts were not renewed, so they were released and went back home. I think there was evidence that this is also happening.

Ms Denise Phua Lay Peng: The Minister did not respond to my request to MOM to look into the interests of disabled employees in Singapore. They are probably the earliest casualties whenever there is an economic decline. We have legislations protecting pregnant Singapore women, and even the NTUC has set up a Migrant Workers' Forum, complete with hotlines and a lot of care, to look after non-Singaporean workers. I hope the Minister will consider and seriously ponder over my request. Please do not say "no" to me now or later.

Mr Hawazi Daipi: I promise I would not use the word "no". This is being looked into by the Ministry of Community Development, Youth and Sports. We have no expertise to deal with the issue of employment of the disabled. But if she wants us to comprehensively look into their interests, as far as employment is concerned, we have already been doing work amongst the agencies and Ministries and, in particular, the MCYS.

Ms Denise Phua Lay Peng: I think MCYS really needs the support of MOM

Column: 3270

so that they can work together in the employment sector.

Mr Hawazi Daipi: Sure, we have been extending our assistance.

Ms Eunice Elizabeth Olsen: I thank the Senior Parliamentary Secretary. I just want to clarify and ask whether he could address my question on whether or not the Ministry is adequately staffed, not only just to deal with but also to speed up the process to resolve the pending cases of the foreign workers because some of them have been known to stay in Singapore for up to a year, or more.

Mr Hawazi Daipi: In my speech, I reported the number of cases that have been resolved. All this points to the fact that our officers have been able to identify, detect and solve the problems. In short, we have increased the manpower for enforcement and we will work hard to make sure that foreign workers and local workers would continue to be protected. If they have problems, we will look into the issues and help them.

The Member mentioned earlier that some foreign workers might have gone home with only half of their salary paid. She said that she got information from online views. Contrary to that view, as we have reported in the newspapers by way of our reply to comments in the Straits Times , all foreign workers who have salary claims will get assistance from MOM if they are sent back by the employers either directly or via an agency. If they complain to the ICA officer at the exit point, they will be referred to MOM and they will get the necessary assistance if the salary claims involve local employers. However, if the disputes involve agencies in their source countries, it would be very difficult for us to help them. In short, yes, we have been beefing up our enforcement manpower and we have been able to solve many of the problems involving foreign workers.

Column: 3271

Mr Siew Kum Hong: Sir, in my speech on the Budget Statement, I mentioned that contract workers may not be benefiting from the Jobs Credit Scheme. Contract workers are frequently employed by agencies who then farm them out to companies. So it is the agencies who are receiving the Jobs Credit and not the companies who bear the cost. I do not think the Acting Minister has addressed this point. I would like to ask if the Ministry would be looking into this.

Mr Gan Kim Yong: For contract workers, so long as they are on CPF, they would benefit from Jobs Credit Scheme and, therefore, it is important for us to continue our effort to reach out to the contract and informal workers to make sure that they contribute to CPF. So contract workers by law will still be required to pay CPF unless the Member is talking about contract for service which is basically the self-employed.

Mr Siew Kum Hong: Sir, if I may clarify. I am referring more to the PMET kind of contract workers who are on contract with an agency and then sent to companies to work there. It would be the company who would be bearing the cost of engaging their services but, technically, they are employed by the agencies. So this is a growing phenomenon, especially in the IT industry.

Mr Gan Kim Yong: So long as they are employed by someone, ie, there is an employer who pays the CPF, the employer will receive the Jobs Credit and, therefore, the employer will benefit from the Jobs Credit Scheme that is given to the contract worker.

Mr Siew Kum Hong: Sir, if I may clarify again? I think the point here is that the agencies who technically employ these contract workers will benefit from the Jobs Credit. But it is the agencies'

Column: 3272

customers who are paying for the services and the Jobs Credit may not flow through to the customers.

Mr Gan Kim Yong: I will need to explain that if this is a commercial arrangement, then it is up to the customer to negotiate with the contract supplier, ie, the agencies, for a lower fee because the benefit has gone to the agencies. Eventually, if the agencies are not going to lower their fees, it is up to the customer to look for other agencies that are willing to lower their fees. Overall, the Jobs Credit will make Singaporean workers cheaper and this benefit will flow through to the employer of these workers. And whether these employers eventually pass it on to the customer, whether the customer is another company's engaged service, or whether the customer is a buyer of this product, is eventually a business transaction between the customer and the supplier.

Dr Ahmad Mohd Magad: Sir, I would like to thank the Acting Minister, Mr Gan Kim Yong, and the Senior Parliamentary Secretary, Mr Hawazi Daipi, for their many clarifications on policy issues and concerns raised by many hon. Members here. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $855,931,900 for Head S ordered to stand part of the Main Estimates.

The sum of $50,793,200 for Head S ordered to stand part of the Development Estimates.

The Chairman:

The Chairman: I shall now deal with the remaining heads of expenditure in respect of which no amendment stands on the Order Paper Supplement. In respect of the Main Estimates, they are Heads B, C, D, E, F and G. I propose to take these heads of expenditure en bloc .

Column: 3273

Question, "That the sums stated for Heads B, C, D, E, F and G which appear in the last column of the Schedule of estimated expenditure under the Main Estimates on page 6 of Paper Cmd. 1 of 2009 stand part of the Main Estimates," put and agreed to.

The Chairman : In respect of the Development Estimates, they are Heads B, C, E and F.

Question, "That the sums stated for Heads B, C, E and F which appear in the last column of the Schedule of estimated expenditure under the Development Estimates on page 7 of Paper Cmd. 1 of 2009 stand part of the Development Estimates," put and agreed to.

Question, "That the sum of $46,314,054,900 shall be supplied to the Government under the Heads of Expenditure for the Public Services shown in the Main Estimates for the financial year 1st April, 2009 to 31st March, 2010 (as amended), contained in Paper Cmd. 1 of 2009," put and agreed to.

Question, "That the sum of $21,567,483,000 shall be supplied to the Government under the Heads of Expenditure for the Public Services shown in the Development Estimates for the financial year, 1st April, 2009 to 31st March, 2010, contained in Paper Cmd. 1 of 2009, " put and agreed to.

Resolutions to be reported.

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

The Minister for Finance (Mr Tharman Shanmugaratnam): Mr Speaker, Sir, I beg to report that the Committee of Supply have come to certain resolutions.

First Resolution reported –

"That the sum of $46,314,054,900 shall be supplied to the Government under the Heads of Expenditure for the Public Services shown in the Main Estimates for the financial year 1st

Column: 3274

April, 2009 to 31st March, 2010, as amended, contained in Paper Cmd. 1 of 2009."

Second Resolution reported –

"That the sum of $21,567,483,000 shall be supplied to the Government under the Heads of Expenditure for the Public Services shown in the Development Estimates for the financial year 1st April, 2009 to 31st March, 2010, contained in Paper Cmd. 1 of 2009."

Mr Tharman Shanmugaratnam: Mr Speaker, Sir, I beg to move, "That Parliament doth agree with the Committee on the said resolutions."

Question put, and agreed to.

Resolutions accordingly agreed to.