UNEMPLOYMENT INSURANCE SCHEME

Mr David Marshall asked the Minister for Labour (a) whether the joint discussions between the Government, the Unions and the employers, with the view to agreement on unemployment insurance as the first step to a more comprehensive social security scheme, have taken place, and what is the outcome thereof; and (b) whether he will make a further statement of Government's intentions with regard to the introduction of social security measures during this session.

The Minister for Finance (Dr Goh Keng Swee) (for the Minister for Labour): Mr Speaker, Sir, I have been asked by my colleague, the Minister for Labour, to reply to this question. The reason is that the Government held a series of meetings in December 1960 and January 1961 with certain Trade Union leaders to discuss, among other things, the introduction of an unemployment insurance scheme in Singapore and I represented the Government on that occasion. In all, five meetings were held and an agreed report prepared for submission to the Cabinet. The Trade Union leaders concerned in this series of meetings were Messrs. Lim Ching Siong, S. Woodhull, D. Puthucheary and S. T. Bani.

This report has not been released earlier for publication at the request of the Trade Union leaders. I intend, however, to quote the section of the report dealing with unemployment insurance, as this would give a clear indication of the Government's attitude towards the subject of unemployment insurance. That section of the report reads as follows:

`Unemployment insurance

The Government side pressed the case for unemployment insurance on the basis of a 1½ per cent contribution by employer and employee. With an unemployment rate of 8 per cent, this would ensure unemployment benefits of about 40 per cent of wages earned during work. If the rate of unemployment is less, the rate of benefits could be increased. The Government proposed that the unemployment scheme be introduced and be restricted, in the first instance, to those industries demarcated for stability. A tripartite committee consisting of representatives of the Government, the T.U.C. and Employers should manage the Unemployment Insurance Fund and have powers to vary the rates of benefits in accordance with the financial state of the Fund. The Government's contribution would be to pay for all benefits during the first sear of the Fund's operation to allow the Fund to accumulate sufficient money from which it could earn interest to pay for administrative expenses. A detailed administrative scheme had been prepared by the Central Provident Fund and there are no administrative policy or other barriers to the immediate implementation of the Unemployment Insurance Scheme.

The T.U.C. members supported the unemployment insurance in principle, hut requested that the matter be further considered by the T.U.C.

In the course of discussion, the Government side stressed that redundancy schemes, severance pay and even unemployment insurance are no more than palliatives to a disease. These measures are intended to reduce the sharp edge of suffering caused by unemployment of workers. Further, where the worker finds it difficult to get another job, retrenchment often sparks off determined opposition from the workers, leading to strikes. The proposals considered and recommended would reduce the distress caused by unemployment. But it is not the basic solution: in fact, in themselves, they will do nothing to reduce unemployment.

The only solution lies in creating conditions whereby the economy could expand at a sufficiently fast rate so that there will be more jobs than men available. When this position is reached, retrenchment and redundancy do not present any problem to the worker. Further, under such conditions, the way would he open for the worker to obtain regular increases of pay through the collective bargaining power of the unions. It was recognised that the maintenance of stability in the industrial sector would he one of the factors conducive to industrial growth and economic expansion, and for this reason, both the Government and the T.U.C, representatives in the Sub-Committee are agreed that everything that could contribute to stability should be pursued, and that any measures that are inimical to it should be refrained from.'

That is part of the report.

Now, Sir, although these trade unionists stated that they supported the unemployment insurance scheme in principle, they had taken no step whatsoever to obtain support from the workers for the principle of a contributory unemployment insurance scheme. In fact, in the course of discussions on the subject, they made it quite clear that they did not want such a scheme to be introduced.

Hon. Members will note that these leaders had given an undertaking that they would refrain from any action which is inimical to stability and do everything to promote stability which is necessary in industrial expansion.

Another section of the report puts the matter even more clearly when it says:

'It will be the responsibility of the T.U.C, to ensure that industrial peace is maintained for the period of the agreement.'

It is now evident to everyone that these trade union leaders had not the slightest intention of honouring their pledge to the Government. Far from ensuring industrial peace, recent events -

Mr David Marshall: On a point of order. The questions are simple and they are not being answered. Instead we are having polemics in respect of political opponents. Could the Minister be requested to confine himself to the question?

Mr Speaker: The rule governing all questions is that an answer must be within the scope of the question asked. If it goes beyond the scope of the question asked, then, of course, the Minister is always entitled to make a ministerial statement. Whether he makes it now, or after questions is a matter of convenience, I leave it entirely to him. Strictly, he should make the statement after questions so that, if he then thinks fit and the statement is controversial, he can always move the adjournment to have the statement debated.

Tun Lim Yew Hock (Cairnhill): On another point of order. May I ask whether it is permissible for a ministerial statement to include subjects which may rightly be considered to be anticipating a debate on a subject that is on the Order Paper - that is, my motion on industrial unrest?

Mr Speaker: I do not think what the Minister has said has any strict relation to the motion, mentioned, which is:

`That this House views with grave concern the mounting of industrial unrest and calls on the Government to take all reasonable steps to ensure industrial peace...'.

I think the Minister is recounting what happened at a meeting of trade unionists and indicating how they had - as alleged by him - not kept their undertaking given to Government. But as the feeling of the Assembly is such, I think I ought to apply the Standing Orders very strictly and ask the Minister either to keep strictly to an answer to the question, or bide his time and wait until after questions to continue his statement.

Dr Goh Keng Swee: Mr Speaker, Sir, I am keeping strictly to the question. Questions of this kind have been coming in regularly from the Member for Anson and I wish to dispose of this issue once and for all. What I am saying will lead to the conclusion explaining just why and how negotiations with the trade union leaders for the implementation of social insurance came to nothing. Sir,I have to go into this matter in some detail to justify the conclusion that the Government has been completely reasonable all the time, but meeting with bad faith from the other side. This is strictly relevant to the question.

Now, Sir, if I may be permitted to continue. The trade union leaders say they support unemployment insurance in principle but in practice they oppose it. Exactly in the same way, they say they support merger in principle but in practice oppose it. Similarly, they support Malaysia in principle but oppose it in practice. Hon. Members are only too familiar with this kind of double-talk on the part of the Communists and their stooges in the Barisan Sosialis.

Tun Lim Yew Hock: P.A.P. side.

Mr Speaker: Order. I must now rule the Minister completely out of order because answers to questions must be strictly statements which do not invite debate, and the Minister is obviously making a statement which does invite debate. So if he proceeds in that strain, I must stop him if he considers that that is the answer to the question. I have indicated that if he wishes to pursue that line of statement, then he must wait and make a ministerial statement at the end.

Dr Goh Keng Swee: Mr Speaker, if you had only borne with me for just two more seconds, you would have seen the relevance. As I was saying, in these circumstances, it is quite futile to have further discussions with those union leaders for the implementation of unemployment insurance, let alone a more expensive social security scheme.

I may mention that I have had informal discussions with representatives of the employers' association in Singapore and they have agreed to support the contributory unemployment insurance scheme should the Government introduce such a measure. It is only certain trade union leaders who oppose this scheme. Why do they oppose it? The reason to me is quite simple. They do not want stability and progress in Singapore. They oppose unemployment insurance because this will reduce tension on the industrial front, and with a reduction of tension and discontent it will be difficult for them to foment trouble. If further evidence of their evil intentions is needed, my colleague, Mr Devan Nair, will only be too pleased to provide them. He told me of the advice which Mr Lim Ching Siong had given -

Mr Speaker: Order. I must now stop the Minister. I must rule all this out of order and if he proceeds on that line, he must stop giving his answer. I suggest that he wait till after Question Time.

Mr David Marshall: If it please you, Mr Speaker, on a supplementary question. Is the Minister not aware -

Mr Speaker: Order. I understand the Minister will be making a ministerial statement. The supplementary question can come after the ministerial statement.

The Prime Minister (Mr Lee Kuan Yew): The whole debate can come.

Mr Speaker: And the whole debate, if necessary.