Prices and service levels will change with restructuring

Minister warns that the impact will be felt by both individuals and companies
By Tessa Wong, The Straits Times, 11 Mar 2013

PRICES will go up and service levels change as the economy goes through wide-ranging changes, said Acting Manpower Minister Tan Chuan-Jin yesterday as he warned that the impact of restructuring will be felt by individuals as well as companies.

"Even as individuals, we also have to look at the way we approach our consumption patterns and our expectations of how services are rendered," he said, speaking to reporters at a grassroots event in Geylang Serai.

Mr Tan added that though Singaporeans "live in a fairly First World developed economy, sometimes in certain sectors we are paying Third World wages".

So as the wages of low-income Singaporeans working in jobs such as cleaning are raised, he said people should "expect that there would be an impact on cost".

"But that's something we need to understand that it's the correct thing to do, to help raise wages, and I guess it's something that we have to learn to adjust to."

On service levels, he cited the example of Japan where many food outlets see automation and self-service.

He said consumers can expect a level of service that is "not necessarily poor, but different", and will have to pay a premium if they still want to be waited on hand and foot.

Yesterday, Mr Tan also addressed concerns about the recently announced wage subsidy known as the Wage Credit Scheme. The scheme was one of the most debated aspects in parliamentary debate last week, with some worrying that it could be exploited by companies to boost bottom lines without improving productivity.

Mr Tan acknowledged concerns but said that "the question is also, how then do you tie it (to productivity gains)?"

"I don't think it (Wage Credit Scheme) is going to be perfect. There will be companies which are planning wage rises anyway, they may well be able to afford it, so some of them may be able to benefit.

"But what we are looking at is... a lot of local companies that are feeling the cost pressures, this will help alleviate cost pressures."

He also said the scheme would be reviewed later.

Yesterday's festivities in Geylang Serai was the first Marine Parade GRC grassroots event Mr Tan has attended since being named as the new anchor minister for the five-member Group Representation Constituency.

Emeritus Senior Minister Goh Chok Tong announced on Facebook yesterday that he had met MPs and branch leaders last Saturday to tell them he would be handing over the reins to Mr Tan.

Mr Tan played down the significance of him taking over the coordinating role.

"I suppose being an anchor minister, it's helpful that you are a minister from Cabinet... Actually all of us play quite involved roles, and I think we support one another in activities like this today. So this will continue."

Marine Parade GRC MP Seah Kian Peng said he had been expecting the change for some time as Mr Tan was the only minister in the GRC after Mr Goh left the Cabinet in 2011.

The GRC's other MPs are Associate Professor Fatimah Lateef and Ms Tin Pei Ling.