NATIONAL PRODUCTIVITY BOARD (AMENDMENT) BILL

Order for Second Reading read. 3.45 pm

The Minister of State for Trade and Industry (Mr Mah Bow Tan): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

The main purpose of the National Productivity Board (Amendment) Bill is to enable the National Productivity Board (NPB):

(a) to form companies, whether solely or in partnership, so as to enable it to play a wider role in promoting productivity and upgrading the skills of our workforce; and

(b) to be appointed as the Administrators of the Skills Development Fund (SDF) with overall accountability for the Fund.

Since the launch of the Productivity Movement in 1981, the NPB has adopted a collaborative approach, by tapping the expertise of companies in the private sector to accelerate productivity growth of local businesses. I would like to quote some examples here.

First of all, the NPB-IBM Information Technology Training Centre, which was launched in April 1988 to provide hands-on computer training for clerical and secretarial workers.

The NPB-Motorola Training Design Centre, which was launched in May 1989 to assist companies develop customised training programmes, for example, for training of mid-career workers.

The NPB-SIA Service Quality Centre, which was set up in November 1990, conducts programmes for frontline staff, supervisors and managers to improve service quality.

The NPB-Philips Industrial Engineering Training Institute, which was launched in January 1991 to train workers in the manufacturing sector in the application of IE techniques.

Due to the widening scope of productivity-related issues, NPB will in future need to introduce many more new programmes. In some cases, it may not have the expertise nor the resources to implement them by itself. It may need to form joint ventures with other companies that have the required expertise.

The present NPB Act is, however, silent on whether NPB can form companies or enter into joint ventures. It is therefore proposed that:

(a) Section 8 of the NPB Act, relating to Powers of the Board, be amended to allow NPB to form companies or to enter into joint ventures, subject to Ministerial approval; and

(b) Section 21(1) (Funds of the Board) be consequentially amended to allow NPB to receive dividends and other incomes generated by these companies that NPB may own, whether solely or in partnership.

The need for the restructuring of the SDF will be dealt with in detail in the Second Reading on the Skills Development Levy (Amendment) Bill. Very briefly, I propose that NPB be made the Administrator of the SDF. The NPB has in practice been assisting the SDF in formulating new initiatives and programmes for worker training, and also administering the ongoing SDF programmes since 1986. The appointment of NPB as the administrator of the SDF will enable the present informal arrangement to be placed on a proper legislative footing, with NPB legally and financially accountable for the administration of the Fund.

To allow NPB to administer the SDF, additional clauses have to be added to section 6 of the NPB Act (Objects of Board) to make it an object of the Board to:-

(a) promote the development of skills and expertise of persons in employment; and

(b) administer the SDF.

It is not the intention of this amendment to allow SDF funds to be used to finance NPB projects. To make this clear, the accounts of the SDF and NPB will be kept separate, as is the current practice. NPB will submit, through the Minister, the audited accounts of the SDF for presentation to Parliament. The Minister's approval is also needed for any change to SDF policy or any new scheme or programme which uses SDF funds. All this is to ensure that there is a clear distinction between the NPB's role as an administrator and as an end-user of SDF funds.

I would also like to take this opportunity to make other amendments to the NPB Act to bring it more in line with the Acts of other statutory boards. The more substantial changes are:-

(a) to give the Minister the flexibility of determining the exact number of Board members (up to 3) that will represent a particular interest group.

(b) to empower the Board to raise loans from Government, or, with Ministerial approval, from other sources;

(c) to invest its moneys in trustee securities; and

(d) to update the provisions relating to the appointment of the Executive Director and other employees.

Mr Speaker, Sir, the proposed amendments to the NPB Act will give NPB greater operational flexibility in achieving its mission of working for continued growth in Singapore's productivity performance.

Sir, I beg to move.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr Mah Bow Tan].

Bill considered in Committee.

[Mr Speaker in the Chair]

Clauses 1 to 3 ordered to stand part of the Bill.

Clause 4 -

Mr Mah Bow Tan: Sir, I beg to move,

In page 3, line 9, to leave out "control and".

Sir, the intention of the amendment is to conserve and preserve the status of the SDF as a Government fund while appointing NPB to administer it. This means that control of the fund will be retained in Government's hands. NPB will administer it in accordance with the Financial Procedure Act and the associated financial regulations which govern all public monies.

Amendment agreed to.

Clause 4, as amended, ordered to stand part of the Bill.

Clauses 5 to 14 inclusive ordered to stand part of the Bill.

Bill reported with an amendment; read a Third time and passed.