TURNING ECONOMIC SLOWDOWN INTO OPPORTUNITY FOR FUTURE GROWTH

[Mr Speaker in the Chair]

Debate resumed.

Mr R. Sinnakaruppan (Kreta Ayer-Tanglin): Mr Speaker, Sir, I rise in support of the motion standing in the name of Mr Lim Swee Say.

Sir, the economies of Thailand, Malaysia and Indonesia have been significantly affected largely because of inadequacy in their national policies, their political culture, their crisis management or mismanagement, or for many other reasons that have been advanced. Singapore, on the other hand, despite its strong fundamentals and an able and honest Government, has nevertheless inevitably been inflicted by this economic flu, or perhaps the economic bronchitis that has swept the region.

While other governments are scrambling around trying to solve their economic and political upheavals, the Singapore Government has begun to steer its course to address the worsening economic downturn. Despite its efforts to reduce business costs, the Government has come under attack from some quarters of the business community. But as economic analysts, like Dr Jim Walker, have pointed out, despite the clamour for more actions to address the crisis, the reality is that there is not much that the Government can do to lift the economy from the downturn or the recession that is looming. The external factors, as Dr Lee Tsao Yuan has pointed out, far outweigh whatever internal measures that the Government takes in the short term. But the Government cannot simply sit out the recession or downturn but instead must plan for the future and develop Singapore's long-term pontential. The crisis mode and environment present a silver lining for Singapore to strengthen its long-term competitiveness and social cohesion. And by "Singapore", I do not mean just the Government but also the employers, unions and the workforce.

Sir, the Government on its part sees skills upgrading as a way to save jobs and to restructure the economy and prepare itself for the knowledge-based economy in the 21st century. The Government has allocated some $120 million for the skills redevelopment programme. But the Government's role in skills redevelopment cannot be limited merely to the funding of programmes. Presently, the NTUC, through its own initiative and to its credit, has taken centre stage in skills upgrading through the SRP. But only about 5,000 workers, out of the more than 700,000 workers without a full secondary four qualification, have been reached so far. This is even less than 1% of those vulnerable workers in our workforce.

Sir, the NTUC, I believe, has got finite non-financial resources. The strategy of outreach to individual companies, I understand from the media, has been refocused to one of outreach through the industry, federations and associations, so that a larger number and spectrum of workers can benefit from the programme. This is where I feel that the Ministry of Manpower (MOM) should play an important role. From feedback, I hear many people telling me that the Ministry of Manpower is perceived as not doing enough and leaving the job of upgrading to the NTUC. This is certainly a common perception.

Sir, the MOM must, like the NTUC, take a pre-eminent role in worker upgrading and drive these efforts. The MOM must move swiftly into action supported by the various Government agencies, the NTUC, the unions and the employers federation. Skills upgrading of the workforce cannot materialise by merely providing funding. From NTUC's experience, the workers' skills upgrading is achieved through a lot of marketing, cajoling, coaxing, perseverance and sustained effort. The MOM must get into the thick of action.

Sir, presently, the Government disburses funds for skills training through some central funding programmes like the SDF or the SRP. I think it is very timely for the Government to consider the much talked about CPF account for skills training, or, as some call it, "trainsave" or "skillsave". Introducing such an account for workers now has got two main advantages. One is that it will make available funding directly to workers to embark on training. It will have the advantage of the push effect on workers to go for training, especially if their companies are reluctant to send them for training. It is just like what NTUC is now trying to do, instead of going to the individual companies it reaches out through the industry associations. But there may be many workers out there who find that they cannot approach their companies to go for training. Having an account like this will make it possible for them to directly join some of these programmes. It will certainly be much better to have this push effect than just the pull effect of central funding for the programmes.

The second reason why this should be done is that there has been much discussion on the possibilities of a CPF cut if Singapore goes into a recession. A CPF training account top-up scheme of sorts will send the right signal on the importance of skills training to workers and help show alternate directions to workers who are facing difficulties, or who would face even more difficulties if CPF is cut. So a CPF reduction will be well buffered by having a CPF training account.

Sir, at this point of time I would also like to ask the Government or perhaps the Minister for Manpower as to when the report on the CET 21 will be released. It seems long overdue, although I believe that the Committee might have completed its work. The report, I believe, will provide insights as to how we can develop a comprehensive framework and action plan which will help turn the economic slow- down into an opportunity for growth for Singapore and Singaporeans.

Sir, the employers and workers, besides the Government, have also an important role in shaping and strengthening Singapore's competitiveness for future growth. Having just returned to the private sector, after spending nearly five years in the trade union movement, I deeply appreciate the respective roles and responsibilities of employers and workers, especially in difficult times like this. In this regard, I would like to urge fellow employers not to use the excuse of the looming recession as a first excuse to shed their workers through retrenchment or temporary lay-offs. This must certainly be the last resort.

Companies must embark on retraining programmes, such as the SRP instead. Many employers do not realise that it is cheaper for them to send their workers for training like the SRP instead of laying them off, retrenching them or having temporary lay-offs. For example, the temporary lay-off very often means that the company bears, say, 50% of their payroll whereas sending workers to SRP means that the company only pays 30% of salary, since SRP pays 70% of absentee payroll. Therefore, companies must approach the workforce with a medium to longer term perspective and use the downturn to train their workforce and nurture in their workforce a sense of company loyalty. I am sure this will pay off when the good times return.

On the other hand, the workers must also become more loyal and committed to the employers that they work for and do their part to improve their work attitude which is grossly lacking, according to BERI's findings, and the workers must do their part to improving productivity at the workplace. Programmes like the NTUC's Productivity Push will certainly strengthen competitiveness of companies in the medium to long term. I urge the NTUC and the PSB to push ahead more aggressively on such programmes so that more can be done to enhance productivity at the workplace.

Sir, there is another area that I would like to touch on relating to employers and unions' bipartite relationship at the workplace. Generally speaking, the relationship between, say, the NTUC leaders and the top management in most companies, is usually pretty good and cordial. Somehow, from my own experience, it cannot be said that the relationship between middle management and many of the branch union officials is just as good. There are many reasons for it. But I think it is important, at a time like this, to close ranks and strengthen that relationship because that relationship would become a strong pillar to strengthen tripartism in Singapore. So we should use this difficult period to focus on strengthening this relationship between the middle management and the branch union officials so that we can come out of it better, stronger and ensure that tripartism will thrive in the beginning of the 21st century.

Sir, I support the motion.