Author: Gerald Giam

Gerald Giam is the Member of Parliament for Aljunied GRC. He is the Head of Policy Research of the Workers' Party of Singapore. The opinions expressed on this page are his alone.

Training your rice bowl away

During weekly house visits with my Workers’ Party colleagues last week, a resident related to us a story which gave me a sinking feeling about the future of our workers in Singapore.

He told us that he conducts courses for many unemployed workers undergoing skills upgrading or conversion. He said he had a trainee who was a highly-skilled technician who could not find a job, likely because of his age and the state of the economy at that time. This technician was persuaded to undergo a course to be trained as a security guard. In the end, he completed the course and took up a security job at a fraction of his last drawn salary. A year later, when the economy started to recover, he tried going back to work as a technician again, but found to his dismay that his year “away” made it even more difficult for him to secure a technician job again. The trainer told me that this is a typical story for many workers who undergo so-called “skills conversion” certification courses.

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Tackling income inequality should be Govt’s top priority

Our national productivity drive needs to start from the top. We currently have three very senior ministers advising the PM, three ministers in the Prime Minister’s Office—two of them without any portfolio—nine ministers of state and six parliamentary secretaries, most of whom are drawing multi-million dollar salaries. Does the prime minister of such a small country really need so many advisers and ministers assisting him?

This is my response to the Finance Minister’s Budget 2010 speech.

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Income inequality is one of the biggest challenges our nation faces. The median household income in 2009 was only 71 per cent of the average income, down from 74 per cent in 1999 [see note 1]. This means that the few very high income earners are pulling up the average, while the large number of lower income earners are pulling down the median. The share of wages in GDP has declined from 47 per cent in 2001 to 41 per cent in 2006 [see note 2]. The Gini coefficient–a measure of income inequality–rose from 0.436 in 1990 to 0.478 in 2009, indicating a widening income gap.

Increasing income inequality has been shown to coincide with higher divorce rates [see note 3] and crime rates [see note 4], particularly property crime. Singapore’s wealthy elites can no longer afford to simply turn a blind eye to the plight of the poor, thinking it will not affect them–because it will, eventually.

Reducing income inequality should be the top priority of the government. This government needs to pay more than just lip service to the goal of ensuring that all Singaporeans benefit from economic growth.

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Low Thia Khiang: Don’t cut pay of workers who reach 60

This was a speech in Parliament on 11 March 2010 by MP for Hougang, Low Thia Khiang, during the Committee of Supply debate, on the budget for the Ministry of Manpower (MOM). Read other Workers’ Party speeches and statements at wp.sg.

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By 2012, the re-employment legislation will require employers to offer re-employment to workers reaching 62 years of age, up to age 65, and eventually to age 67. However, the Re-employment legislation will not replace the Retirement Act of 1999.
The Retirement Act allows an employer to reduce the wages of older employees up to 10% on or at any time after the employee attains 60 years of age.
The 10% pay cut at age 60 was recommended by the Tripartite Committee on the Extension of Retirement and the justification then was to address the problem of the seniority-based-wage system.
With the Government’s call to increase productivity and the progress made in wage restructuring from a seniority-based wage system to a performance-based wage system, I would like to call upon the Government to review the Retirement Act of 1999 by removing the wage reduction option given to employers.
A wage system that moves away from seniority elements and towards job worth and performance is more than adequate to ensure an older worker is paid based on the value of the job and his contribution instead of his seniority. Given that the performance-based wage system will improve the cost competitiveness and employability of older workers, we should remove the wage reduction anomaly from the Retirement Act as older workers would have been paid market rate in the run-up to age 62.
Moreover, the Tripartite Committee’s recommendation that employer’s CPF contribution rate for employees aged 60-65 years be reduced from 7.5% to 4% and from 5% to 4% for employees aged above 65 years is sufficient to make re-employment worthwhile for employers.
Sir, any provision in our labour laws to reduce the wages of older workers upon reaching re-employment age will dampen the zeal of an ageing society to continue working beyond retirement age.

By 2012, the re-employment legislation will require employers to offer re-employment to workers reaching 62 years of age, up to age 65, and eventually to age 67. However, the Re-employment legislation will not replace the Retirement Act of 1999.

The Retirement Act allows an employer to reduce the wages of older employees by up to 10 per cent on or at any time after the employee attains 60 years of age.

The 10 per cent pay cut at age 60 was recommended by the Tripartite Committee on the Extension of Retirement and the justification then was to address the problem of the seniority-based-wage system.

With the Government’s call to increase productivity and the progress made in wage restructuring from a seniority-based wage system to a performance-based wage system, I would like to call upon the Government to review the Retirement Act of 1999 by removing the wage reduction option given to employers.

Continue reading “Low Thia Khiang: Don’t cut pay of workers who reach 60”

Low Thia Khiang: Give part-time and contract workers have good training opportunities

This was a speech in Parliament on 11 March 2010 by MP for Hougang, Low Thia Khiang, during the Committee of Supply debate, on the budget for the Ministry of Manpower (MOM). Read other Workers’ Party speeches and statements at wp.sg.

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As at June 2009, there were 87,400 resident employees on short term contracts of less than three months and 156,200 residents on part-time employment. About half of these employees are in the older age group and the majority of them have lower educational qualifications, with a gross monthly income of below $1,000.

I am of the view that the number in this category of employees would increase over time because companies want flexible manpower and to be able to respond faster to changing demand and cost variations as the business environment changes. Secondly, as our society matures with an increasing number of ageing employees, more people may prefer such a mode of employment, as seniors may not want to work full time.

Contract and part-time workers may not necessary be low wage and low productivity. Some studies have shown that part-time workers can be as productive as full-time workers and companies employing part timers do not necessary suffer low productivity. I understand that in the Netherlands, in which a relatively large share of the workforce works part-time, achieves high labour productivity. Hence, I believe that there is much room for improvement in productivity and income of our contract and part-time workers.

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Sylvia Lim: Tier electricity pricing to favour small consumers

While offsets to low-income households will be useful while it lasts, an additional idea is to have a tiered system of pricing electricity in favour of small consumers. The fundamental idea is for a threshold level of power consumption by households to be determined. Households consuming less than the threshold level will enjoy a low tariff charge. With increasing consumption levels, the tariff escalates. The higher tariff collected in the upper tiers can be used for 2 purposes: to cross-subsidize the first tier tariff, and to encourage all households not to over-consume electricity.

This was a speech in Parliament on 8 March 2010 by NCMP Sylvia Lim during the Committee of Supply debate, on the budget for the Ministry of Trade and Industry. Read other Workers’ Party speeches and statements at wp.sg.

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The Economic Strategies Committee has put forth recommendations on Singapore being a Smart Energy Economy.

As electricity is a modern necessity, it is of paramount importance that it is reliable, pollution-free and affordable.

As regards reliability, the ESC recommends that in the medium term, Singapore consider importing coal and electricity to diversify our energy sources, so as to free up land in Singapore. I would like clarification on the pros and cons of relying on imports and thus becoming less self-reliant for our energy needs. Which are the countries we are likely to import electricity from? Will there be additional risks to our energy security?

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Raymond Lim once proposed a way for “completely free” public transport

Actually Minister Raymond Lim had once proposed a way to have completely free public transport. Here’s what he said about public transport concessions during a constituency visit back in 2008.

In response to NCMP Sylvia Lim’s call in Parliament on 11 March 2010 for transport concessions for the disabled, Transport Minister and MP for East Coast GRC, Raymond Lim, said: “I’d be very slow in stipulating (to operators) how best to run the concession policy.”

But actually the Minister had once proposed a way to have completely free public transport. Here’s what he said about public transport concessions during a constituency visit back in 2008:

“The money still must come from somewhere, right? It is about 1.5 percentage point increase in your GST. So now it’s 7 (per cent), you want it to be free? You want the GST to go up to 8.5 per cent, to run a completely free bus and MRT system?”

Sylvia Lim asks for concessionary travel for disabled on public transport

According to a 2001 MOH survey, less than 2 per cent of Singaporean adults below 60 have some sort of disability. Is the number of disabled too much for the PTOs? The PTO’s operations are reaping profits of tens of millions of dollars annually and this is part of their corporate social responsibility.

This was a speech in Parliament on 11 March 2010 by NCMP, Sylvia Lim,during the Committee of Supply debate, on the budget for the Ministry of Transport. Read other Workers’ Party speeches and statements at wp.sg.

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Disabled persons face challenges fitting into society for work, recreation and social interaction. Travel is a necessary step towards integration, to work, to socialise and to be consumers.
There are currently no public transport concessions for the disabled.
The disabled here have low earning capacity. Many do not work; those who do, earn a few hundred dollars per month, spending up to a third on travel expenses.
The government has often said that we should build an inclusive society. It therefore should not take a back seat on this issue.
Other governments are proactive. In the UK, disabled persons qualify for a special “Railcard” which entitles them to travel throughout the UK at one-third off from the normal fare. In addition, disabled persons in London can travel off-peak for free on buses, the Underground and trains.
The government cannot wash its hands off the matter by saying that the public transport system is operated commercially and it is up to the public transport operators (PTOs) to decide. The disabled have no bargaining power against the big companies.
For instance, the Land Transport Authority, as regulator, can make it a licensing condition that the PTOs recognize disabled passengers for concession travel.
According to a 2001 MOH survey, less than 2 per cent of Singaporean adults below 60 have some sort of disability. Is the number of disabled too much for the PTOs? The PTO’s operations are reaping profits of tens of millions of dollars annually and this is part of their corporate social responsibility.

Disabled persons face challenges fitting into society for work, recreation and social interaction. Travel is a necessary step towards integration, to work, to socialise and to be consumers.

There are currently no public transport concessions for the disabled.

The disabled here have low earning capacity. Many do not work; those who do, earn a few hundred dollars per month, spending up to a third on travel expenses.

The government has often said that we should build an inclusive society. It therefore should not take a back seat on this issue.

Continue reading “Sylvia Lim asks for concessionary travel for disabled on public transport”

Sylvia Lim: Increase size of cohort entering local universities

Currently, the proportion of Primary One cohort admitted into the local subsidized universities is targeted to rise to 30% by 2015, with the new university and institute coming up. I would like to ask if MOE will review this 30% target with a view to increasing it.

This was a speech in Parliament on 10 March 2010 by NCMP, Sylvia Lim,during the Committee of Supply debate, on the budget for the Ministry of Education (MOE). Read other Workers’ Party speeches and statements at wp.sg.

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Currently, the proportion of Primary One cohort admitted into the local subsidized universities is targeted to rise to 30% by 2015, with the new university and institute coming up.
I would like to ask if MOE will review this 30% target with a view to increasing it.
I note MOE’s concerns that we should not have sudden increases in graduate numbers which may leave many unemployed or under-employed.
However, since Singapore is prioritising innovation and greater productivity, the population as a whole has to raise its game, and the jobs of the future will require different educational qualifications from currently. We are also trying to encourage the growth of entrepreneurs to find their own niches. With globalization, Singaporean graduates also have more opportunities overseas, which will still benefit their families and Singapore, directly or indirectly.
As a matter of interest, according to the OECD Factbook 2009, the 25 OECD countries were expecting to graduate on average about 37% of an age cohort from Tertiary-Type A (typical degree level) education in 2006. It was stated that there was a strong trend in increasing their cohort participation rates in the last 15 years in line with producing highly-skilled labor forces.
I agree that we need to maintain standards in university admission. However, over the years, many students who were rejected by our local universities were admitted to reputable foreign universities and did well. But this route is available only to those whose parents could afford it.
I hope the Ministry will look into revising the cohort participation rate at our local subsidized universities beyond 30%.

Currently, the proportion of Primary One cohort admitted into the local subsidized universities is targeted to rise to 30% by 2015, with the new university and institute coming up.

I would like to ask if MOE will review this 30% target with a view to increasing it.

I note MOE’s concerns that we should not have sudden increases in graduate numbers which may leave many unemployed or under-employed.

However, since Singapore is prioritising innovation and greater productivity, the population as a whole has to raise its game, and the jobs of the future will require different educational qualifications from currently. We are also trying to encourage the growth of entrepreneurs to find their own niches. With globalization, Singaporean graduates also have more opportunities overseas, which will still benefit their families and Singapore, directly or indirectly.

Continue reading “Sylvia Lim: Increase size of cohort entering local universities”

Sylvia Lim: R&D spending needs to be accounted for

I agree that it is necessary for Singapore to invest heavily in R&D for our nation’s future. However, it is critically important to measure the output and impact of our R&D investments to ensure that it is money well-spent.

This is admittedly not an easy task. The results from research may take years to materialise, and some R&D may be undertaken for strategic reasons, the benefits of which may not be easy to quantify. Nevertheless, any public spending needs to be accounted for.

This was a speech in Parliament on 8 March 2010 by NCMP, Sylvia Lim, during the Committee of Supply debate, on the budget for the Ministry of Trade and Industry (MTI). Read other Workers’ Party speeches and statements at wp.sg.

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Since the year 2000, Singapore has spent $33 billion on R&D, also referred to as the Gross Domestic Expenditure on Research and Development, or GERD. Of this, about $12 billion was funded by taxpayers.

I agree that it is necessary for Singapore to invest heavily in R&D for our nation’s future. However, it is critically important to measure the output and impact of our R&D investments to ensure that it is money well-spent.

This is admittedly not an easy task. The results from research may take years to materialise, and some R&D may be undertaken for strategic reasons, the benefits of which may not be easy to quantify. Nevertheless, any public spending needs to be accounted for. Continue reading “Sylvia Lim: R&D spending needs to be accounted for”

Low Thia Khiang: Access to good mentors key to helping entrepreneurs succeed

While financing is important, access to good mentors is equally key to help these entrepreneurs succeed. Are there sufficiently experienced mentors available to advise our entrepreneurs? If not, are there plans to invite successful business founders or venture capitalists from places like the Silicon Valley to provide sound advice to these start-ups and evaluate their business plans?

This was a speech in Parliament on 8 March 2010 by MP for Hougang, Low Thia Khiang, during the Committee of Supply debate, on the budget for the Ministry of Trade and Industry (MTI). Read other Workers’ Party speeches and statements at wp.sg.

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The ESC and the Budget seem to focus heavily on helping companies which are already successful to become Globally Competitive Companies.
In its drive to identify and assist these promising medium-sized companies, has the Government forgotten about local small businesses like sundry shops and car workshops? Would such small enterprises have a place in the new economic landscape, or will they be crowded out or gobbled up by bigger fish?
What is the Government doing to help local small businesses, especially those in sunset industries, to become more competitive and viable in the new economy?
Secondly, is the Government providing the right environment and support for entrepreneurship to flourish in Singapore? We must not lose the spirit of enterprise in Singapore, keeping in mind that many global companies today started from very humble beginnings.
Last year, a survey of 2,300 students from local universities and polytechnics found that less than 2 in 10 of them considered starting their own businesses after graduating, compared to almost 7 in 10 who planned to take up salaried jobs. Is the Minister concerned that so few of our brightest students aspire to be entrepreneurs? Are our schools helping their students to develop more of the traits necessary to be successful entrepreneurs? For example, risk-taking, initiative and agility.
I understand that SPRING Singapore has a number of schemes that provide funding to start-ups. Can the Minister provide an update on how effective these schemes have been in nurturing successful entrepreneurs?
While financing is important, access to good mentors is equally key to help these entrepreneurs succeed. Are there sufficiently experienced mentors available to advise our entrepreneurs? If not, are there plans to invite successful business founders or venture capitalists from places like the Silicon Valley to provide sound advice to these start-ups and evaluate their business plans?

The ESC and the Budget seem to focus heavily on helping companies which are already successful to become Globally Competitive Companies.

In its drive to identify and assist these promising medium-sized companies, has the Government forgotten about local small businesses like sundry shops and car workshops? Would such small enterprises have a place in the new economic landscape, or will they be crowded out or gobbled up by bigger fish?

What is the Government doing to help local small businesses, especially those in sunset industries, to become more competitive and viable in the new economy?

Continue reading “Low Thia Khiang: Access to good mentors key to helping entrepreneurs succeed”