CUSHIONING THE IMPACT OF THE DOWNTURN

Debate resumed.

BG George Yong-Boon Yeo: Sir, in summary, we support what Mr Goh has proposed.

Mr Seng Han Thong (Ang Mo Kio): Sir, on the enhanced Skills Redevelopment Programme whereby employers need to pay only 20% of course fees, may I know how soon can it be implemented? As we know, many companies need to send hundreds of their workers for SRP training but they are facing this cashflow problem of paying 100% of the course fees first. In particular, a company which sends 200 workers for a $3,000 programme, it would cost them $600,000 and the claim from Government takes months.

My second question is whether the Minister will agree with Mr Simon Tay's suggestion of keeping PWD Corporation out of public projects. If so, the workers from PWD Corporation will suffer and be retrenched.

BG George Yong-Boon Yeo: Sir, in reply to Mr Seng Han Thong's first question, as quickly as possible, there will be no unnecessary delay in working out the details of this programme. On PWD, our responsibility is not only to the industries. It is also to those workers in PWD who work with us faithfully for all these years. So when we told them that we were going to privatise it, we owed them a responsibility and we had to encourage them to move out from a permanent Government service into a private company. To give them that assurance, and they have families to support, we told them, "All right, five years' moratorium." I think we should stick to it and not because we are under pressure, cause a breach of faith in the solemn undertaking which we gave them.

Dr Lily Neo: Sir, I would like to pose two questions to the Minister. May I ask whether the HDB rental rebates announced earlier would more than offset the recent HDB rental hikes, or would the Minister consider reversing these HDB rental hikes to give an even better impact on these post-budget measures? Could I also ask the Minister whether he would give more incentives to businesses, factories and manufacturers to turn the downturn time to opportune time by helping them to revamp and upgrade to improve their competitive edge and their productivity?

BG George Yong-Boon Yeo: Sir, Dr Lily Neo had an exchange with Minister Mah Bow Tan earlier on this particular issue of rental rebates. There are really two choices. For those who are already below market rental, we could have said, "Look, you do not qualify for the additional rebates because you are already below market rental." Or we say, "Let us separate the two aspects". There is already a long-term policy to bring them up to market rentals so that shops on the same row operate on a level playing field and, on that basis, we give them their rebates. Or have two separate classes of shops. I agree with Minister Mah Bow Tan that the one we have proposed is the fairest. As to whether in specific dollars and cents for particular shops, whether the net result is positive or negative, that question I would have to refer to Minister Mah Bow Tan for response because I am not familiar with the exact details. It probably varies from shop to shop.

As to the other question about incentives to help our shops upgrade and become more productive, as you know, we have many programmes under PSB to help them. It is not easy. Very often, it depends on whether their own children are prepared to take over those shops and to have them upgraded. For those whose children are not prepared to join their fathers' shops, then we have got a scheme to help them exit. I believe each is given a grant of $48,000. We cannot avoid this restructuring. Basically, we have too much retail space in Singapore.

Recently, in Bedok Reservoir, Sheng Siong opened a new supermarket. They say, "Special sale - eight cucumbers - $0.30". Everyone flocks there. My residents are all very happy. But all the neighbourhood shops are very unhappy. Can we stop it? Is it good to stop it? Even if there is no Sheng Siong, there is Carrefour, there is Walmart. There will be other chains operating, which will be able to sell at lower costs because they have got better supply chain management and they have got stronger purchasing power. Our job is to facilitate adjustment, not to add friction to market adjustment. That is the approach we are taking. For those who want to make the adjustment, we help them in as many ways as we can. For those who want to exit, we try to make it as easy for them to exit as possible.

Mr Hawazi Daipi: Sir, the "People for Jobs" Traineeship Programme is a good programme to help workers who would find it difficult to take up technical based courses. Does the Government have any estimates of the number of people who can be considered as most vulnerable, people who would find it very difficult to move into technical lines? What is our target of training places for this programme?

BG George Yong-Boon Yeo: Sir, I do not have the detailed forecast. The Ministry of Manpower would have them. But the basic policy is clear that we will do as much as there is demand. In other words, budget would not be a constraint and if there are better ways to make the programme work, we will do as much as possible. This is a big group in Singapore, the baby-boomers, many of whom do not even have more than six years of education. They will be in the system for another 20 to 30 years and our fear is that many of them would become demoralised if they are not able to find gainful employment. With this economic downturn, there is widespread fear among them that if they are retrenched, it is very difficult for them to get a job again. We must find various ways to help them. We have proposed some initial measures but our people are still thinking about them. The unions and employers' associations are also thinking of them. As and when good ideas come forth, we will implement them. But the basic position is to do as much as we need to do and budget ought not to be a constraint.