SCHOLARS (Breaking of service bonds)

Mr Tay Beng Chuan asked the Prime Minister (a) whether he will provide statistics on the number of local and overseas university scholars who had broken their service bonds upon graduation; (b) whether the Government considers it worthwhile and practical to issue study loans without any service bonds attached to achieve their manpower planning purposes; and (c) whether study loans as an alternative to Government scholarships will be affordable for lower-income families wishing to send children to better universities abroad.

The Deputy Prime Minister (BG Lee Hsien Loong) (for the Prime Minister): Mr Speaker, Sir, with your permission, may I take Question Nos. 8 and 9 together?

Mr Speaker: Yes.

BG Lee Hsien Loong: As the Prime Minister stated on 24th April 1999, the Government does not intend to abolish scholarships, or to replace them with study loans for bright students.

For Singapore's future progress and success, it is crucial for the civil service and statutory boards to attract their fair share of talent. This will ensure continued strong and capable public sector leadership. Scholars are a vital source of such public sector talent. This is so not only for premier scholarships like the President's Scholarship, SAF and Police Overseas Scholarship or OMS Scholarship, but also the many other scholarships offered by the civil service, SAF, and statutory boards. Many Government-linked companies have also found scholarships a good way to attract talent to join their organisations.

Overall, the scholarship schemes have worked well. Only a very small number of PSC scholars (1% of local scholars, and 0.2% of overseas scholars) break their bonds before starting work. Most adapt well to their working environment and new responsibilities. The agencies administering the scholarships exercise flexibility in deploying scholars, taking into account the individuals' interests and aptitudes as well as the organisations' needs. They take pains to make scholars understand that in return for the opportunity to study in top institutions, they have a legal and moral obligation to contribute something back to society. Scholars have risen to become Permanent Secretaries, CEOs of statutory boards and senior SAF and Police officers. Some have entered politics, to become MPs and Ministers.

No student is compelled to take up a scholarship, and thus be bonded to serve the Government. Every Singaporean who qualifies for admission is already assured of a university education in NUS and NTU, even if he cannot afford to pay the already highly subsidised fees. Students should only apply for undergraduate scholarships provided they want to pursue a course for which scholarships are available, accept the terms and objectives of the scholarship scheme, and are ready to commit themselves to a public service career. Those who are not yet certain of their minds are better off studying on their own, or if necessary taking a study loan. Then they are free to choose their university course, and defer the choice of career until after graduation.

Banks already offer study loans at market rates. The Government cannot justify offering study loans with public funds, especially at subsidised rates, to study abroad. Taxpayers' money must be used only for national interest, and not for an individual's self-fulfilment. Students taking loans to study abroad have no legal or moral obligation to return to serve the sponsoring organisation. Some may even feel that they have no moral obligation to return to serve Singapore. If we replace scholarships with study loans, we will end up losing many of our top students.

The Government and the statutory boards will therefore continue offering scholarships for courses of study in areas where the State needs talent and expertise. We will regularly review the terms of the scholarship schemes, as well as the management of scholars during and after their university courses, to ensure that these continue to meet our objectives, and to keep up to date with changing circumstances. We will also strive to recruit more talent from other sources, including able students who did not take a scholarship to go to university, and mid-career executives who have made their mark in the private sector.

Dr Wang Kai Yuen: Would the Minister give his view regarding Dr Tony Tan's comment on the practice of safeguarding or "cold-storaging" job vacancies for scholarship holders as being too rigid?

BG Lee Hsien Loong: It is an obligation which the organisation which gives the scholarship takes upon itself. When you give a scholarship, you must also bear in mind that the scholars are going to come back in three or four years' time and you will have to decide where you are going to deploy him and how you are going to use him. This is not just slave labour. This is a person who has been educated, whom you have invested in, and whom you have a responsibility to deploy to best purpose. It is not a light obligation, but it is one which the public service has taken on and, I think, has been able to fulfill in the areas where it needs this talent. The point is that a scholarship is not just a one-way obligation. The organisation awarding the scholarship takes on an obligation to look after the scholar and to deploy him and use him fruitfully, and the scholar who receives the scholarship receives the benefit because he gets his education and, at the same time, he takes on an obligation to come back and give his best to the organisation.

Mr Zulkifli Bin Baharudin (Nominated Member): I would like to ask the Deputy Prime Minister whether there are cases where our eligible students have refused scholarships, say, President's scholarship, because they find that they have adequate resources and do not depend on Government to pursue further studies.

BG Lee Hsien Loong: Yes, there are. There are alternatives. They can go on their own. They can work for some time before going overseas. They can take loans. Or they can go to NUS. And there have been cases of students who have said, "No, thank you very much. We don't want the bond." Not all these students are from affluent families. I have heard even, in one case, a taxi-driver's son, who said, "No, I won't take the scholarship. I will go on my own." There are also other scholars I have heard of - this may be apocryphal - who have applied for the scholarship because they want the benchmark. And having been awarded the scholarship, the father says, "All right, you turn it down. I will pay." Unfortunately, we have not found a way to sieve out such people at an early stage.

Mr Zulkifli Bin Baharudin: That being the case, is there a danger that the scholarships are given not to our best and ablest? Because our best and ablest may potentially come from more affluent families. Then there is a risk as to what will happen to our President's Scholarship or other premier scholarships.

BG Lee Hsien Loong: That is a problem. We regularly ask the PSC whether they have been able to attract good scholars, and up to now they have assured us that they have got a reasonable share of the top students. And the PSC alone gives about 150 to 200 scholarships a year. But it will increasingly become a problem. We are in a different situation now from the time when I took a scholarship in 1971, when nearly my whole class went to university on scholarships, and without scholarships, could not have gone to university, much less study abroad. That is not the situation today. If they do not take a Government scholarship, they can get one from EDB, MAS, DBS or Sembawang, or so many others who are sometimes falling over themselves to give these scholarships out. And so the students sometimes feel that, "Wow! I am a valuable talent. There is such enormous demand for my capabilities.", which may not be borne out in later life.

But we need to continue to attract good people in, and I believe that over a period of time, we will have to make a greater effort to attract in people who did not take scholarships but who have the talent, who have gone to universities on their own, who may have spent some time working, and now want a change. We must bring them in, whether it is for a few years on contract or on a permanent change of career, to have a greater flow-in from graduating students and from the private sector. MAS, for example, has brought in quite a number of people from the private sector, mid-careers, some from academia, from universities. And we have found it a very fruitful experience, because the interaction between the people who are in the organisation who have the experience and institutional memory of how things are done and why, as well as the people who have come in without that long experience but with a different perspective from the private sector, has been good for both sides and good for the organisation. We need more organisations to do that. But it is easier for some than for others. It is very difficult to bring in a civilian mid-career and make him a colonel or a general in the SAF. It may be easier with banking or with urban planning, or even with administration. But we have to work harder.

Dr Lee Tsao Yuan: Will the DPM consider giving scholars the option of pursuing post-graduate studies immediately upon graduation from their undergraduate studies? Because this is one potential deterrent for them taking up the scholarships, that they have to come back to serve before pursuing post-graduate studies.

BG Lee Hsien Loong: There is some flexibility in this. PSC often allows scholars to do Masters degrees immediately as a continuation of their undergraduate course. For PhDs, they are more selective, but it is not a blanket no. It really depends where we think you can be valuable and whether this fits in with our career plans for you. If you go on an academic scholarship from the university, then, of course, you go on to a PhD and come back to a teaching career. If you go into a scholarship to serve in the SAF, and you say, "I want to go on and spend three years doing a PhD.", I think the SAF will legitimately ask, "How does this help you to serve me better? Or will it only make you more reluctant and more difficult to fit into the organisation after you complete your PhD, and therefore we would have to be more careful in making decisions?" But even then, we have had SAF scholars who have taken no-pay leave, after working for some years, and gone and done PhDs. One of them is now the CEO of the URA.

So it has been done. But the education is for the purpose of enhancing your ability to contribute to Singapore. If it is purely self-fulfilment, then it is something which you have to look after on your own.