Sunday, 1 March 2020

Budget 2020 debate in Parliament

Parliament passes $106 billion Budget aimed at meeting immediate challenges like Covid-19, while keeping eye on the future

President and ministers to take 1-month pay cut; special bonus for front-line public officers tackling Covid-19

Singapore is able to respond strongly and effectively because of trust between people and Govt: DPM Heng Swee Keat
By Tiffany Fumiko Tay, The Straits Times, 29 Feb 2020

All Cabinet ministers - including the Prime Minister - and political office-holders, as well as the President, will take a one-month pay cut to show solidarity with Singaporeans coping with the coronavirus outbreak.

Meanwhile, public officers on the front line will get up to one extra month of special bonus in recognition of their sacrifices battling the Covid-19 disease.

They include healthcare officers in restructured hospitals and the Ministry of Health, as well as some officers in other front-line agencies who have been directly involved in containing the spread of the virus.

A one-off grant will also go to the 900 general practitioner clinics that have been designated as Public Health Preparedness Clinics to support them as they care for patients with respiratory symptoms.

Deputy Prime Minister Heng Swee Keat announced these in Parliament yesterday in rounding up the debate on this year's Budget, which comes at a trying time for businesses, families and workers, especially those on the front line.

"Our front-line workers, especially healthcare workers in the restructured hospitals, have shown outstanding courage and dedication," he said.

"While we cannot thank them enough, we can show our appreciation and support in a tangible way," he added at the close of debate on Budget 2020, following speeches from 57 MPs over three days.

In addition to the pay cut for office-holders, all MPs will take a one-month cut in their allowance. Senior public service officers, including permanent and deputy secretaries and statutory board chief executives, will also take a half-month pay cut.

Mr Heng, who is also Finance Minister, said this year's Budget debate took place under "exceptional circumstances", with businesses, workers and households facing a softening of the global economy and the Covid-19 outbreak that has hit sectors like tourism, hospitality and retail especially hard.

As MPs like Mr Vikram Nair (Sembawang GRC) noted, the entire population needs to come together to weather the storm, said Mr Heng.

They have done so, at a time when it is tempting to just look out for oneself, he added, citing various efforts by groups and individuals to help those affected. He said: "We will win this war over the virus by fighting as one united people."

"Singapore has been able to respond strongly and effectively to Covid-19 because there is strong trust between the people and the Government, and the sense that we are all in this together," he added.

Such trust also enabled the Government to make decisions quickly and carry them out effectively, with people confident that those responsible know what they are doing, said Mr Heng.

"We do not hide bad news, we do not flinch from doing the right thing, we will go the extra mile to help every one of us come through this together. That is why people comply with stringent quarantine orders, people accept reassurances about masks, people feel safe and carry on with their lives," he said.

"The fundamental basis for this is trust and solidarity between the Government and the people."

Noting that Singapore will face challenges in the weeks and months ahead, he added that it would need to draw on its reserves of trust and solidarity.

"This unity of purpose across our whole society is what will see us through these challenging times."

"And if we conduct ourselves well in this crisis, we will replenish those reserves, and strengthen our resilience and unity for another generation," he said.

President Halimah Yacob welcomed the bonus for those on the front line, saying on Facebook: "They truly deserve it. It is a small recognition, but it goes a long way... We must not underestimate their sacrifices."

Nominated MP Walter Theseira, one of several MPs who sought more support for front-line staff, welcomed the move.

On MPs' questions over whether the Government could provide businesses with more sizeable support, and for longer, Mr Heng said the hope was that this would not be necessary.

"But if it does, for example if the outbreak becomes a worldwide pandemic, and the global economic impact is deeper and longer, we have the fiscal resources to do so, and the will to act," he said.

Parliament will continue to debate the spending plans of the various ministries all of next week.

Jobs Support payouts to struggling firms will start early
8 per cent wage offset for local workers to be paid out in end-May instead of July 2020
By Tiffany Fumiko Tay, The Straits Times, 29 Feb 2020

The disbursement of payouts to firms for the recently announced Jobs Support Scheme will be moved up by two months to provide speedier relief to those struggling to stay afloat, Deputy Prime Minister Heng Swee Keat said yesterday.

This comes after several MPs, including Mr Seah Kian Peng (Marine Parade GRC), asked whether the 8 per cent wage offset for local workers, which will cover three months ending last December, could be paid earlier than July.

In his reply, Mr Heng said that while the disbursement of payouts for this scheme is operationally complex, the agencies involved have redoubled their efforts and are now aiming to bring forward payment to end-May.

A number of MPs asked for more immediate and extensive support for businesses and workers affected by the coronavirus outbreak, over the three days of debate on the Budget.

Mr Heng said in his round-up speech that the Government's top priority is preserving and enhancing jobs. Small and medium-sized enterprises (SMEs), which employ the bulk of local workers, will benefit from the two biggest measures in the $4 billion Stabilisation and Support Package, said Mr Heng, who is also Finance Minister.

"As a percentage of revenue, SMEs will receive payouts that are, on average, five times as much as the average for all enterprises," he said.

Apart from the Jobs Support Scheme, enhancements to the Wage Credit Scheme, which currently co-funds wage increases for Singaporean employees earning a gross monthly wage of up to $4,000, will be provided in the second half of the year to spread out support for enterprises in a more sustained way.

Targeted support for those most in need is also forthcoming, he said.

An additional $400 million is being doled out to the hardest-hit tourism, accommodation and aviation sectors as part of the relief package.

Taxi and private-hire car drivers, hawkers, tourist guides, retailers and food and beverage operators who have felt the ripple effects have been allotted an extra $200 million to help them tide over this period, said Mr Heng.

Responding to those who had asked whether more could be done for other groups of self-employed workers and freelancers, Mr Heng said details will be announced by the ministries at a later date.

Addressing the timeliness of the support for firms, he said the measures must be considered in totality.

Commercial landlords who qualify for property tax rebates will receive them by the end of May, while corporate income tax rebates will be accounted for in the tax bills that all firms will receive next month.

Rental waivers for government commercial tenants will largely apply to the months of March and April, he added. "These will provide not just financial relief, but also help with enterprises' shorter-term cash flow needs."

Still, all Singaporeans must play their part to help overcome the challenges posed by the virus outbreak, Mr Heng said.

"How we respond to moments of challenge and crisis is a test of our individual resilience and the strength of our character," he said.

"Even more, it is a test of our social cohesion and solidarity. It is a test of who we are as a people, and as a nation. Do we panic and become self-centred, or do we stay calm, band together and look after one another?"

United, Singapore can overcome both Covid-19 and long-term challenges
By Lim Yan Liang, The Straits Times, 29 Feb 2020

Parliament yesterday approved a $106 billion Budget meant to help Singapore overcome the immediate effects of the coronavirus outbreak, while also tackling longer-term issues the country faces such as climate change.

In a 107-minute speech, Deputy Prime Minister Heng Swee Keat addressed concerns raised by 57 MPs over three days, including the principles that underpin the Government's spending plans.

He said that this year's "unity Budget" came amid exceptional circumstances, with a softening global economy as well as the Covid-19 outbreak, and was so named to highlight the importance of unity among Singaporeans in this trying time.

"How we respond to moments of challenge and crisis is a test of our individual resilience and the strength of our character," said Mr Heng, who is also Finance Minister. "Even more, it is a test of our social cohesion and solidarity."

The Budget expresses the spirit shown by many of staying united through thick and thin, and the Government's confidence that Singaporeans will rally together to meet such challenges head-on, he said.

He called on Singaporeans not to take this unity for granted, noting that around the world, and even close to home, "we have seen societies torn by forces that foment polarisation, communal conflicts and political turmoil".

But united, Singapore can overcome not only the Covid-19 outbreak, but also longer-term challenges such as ageing, technological disruption, social inequality and climate change.

The three-day debate saw MPs such as Ms Foo Mee Har (West Coast GRC) ask whether the goods and services tax (GST) had to be raised, given annual Budget surpluses, and if government revenue could be raised in other ways, such as a wealth tax or estate duties.

Workers' Party Non-Constituency MP Leon Perera asked if the Government could slow the rate of growth of national reserves and release more funds to invest in Singaporeans and local companies.

Responding, Mr Heng said a broad-based tax like the GST is an appropriate and responsible way to pay for major societal needs such as healthcare spending, noting that the $6 billion Assurance Package announced this year will provide a "bigger and thicker cushion" that will effectively offset the eventual GST hike for lower-income Singaporeans by 10 years.

As a recurrent need, such spending should be funded with recurrent revenues, not one-off surpluses such as those seen in this term of government, he added.

"This is ultimately about us collectively chipping in to look after the healthcare needs of our families," he said. "Each generation must pay for its own spending."

Quoting a Chinese saying that one generation plants the trees and the later generation enjoys the shade, he said Singapore's reserves are today like a tree with lush foliage because of the founding generation of leaders who had the foresight to save the nation's surpluses and invest them for the long term.

"If we use reserves or rely excessively on investment returns for regular expenditures, that would be the same as damaging, or even cutting down, this tree," he said in Mandarin.

As a country founded on a vision of a just and equal society, with broad-based prosperity and equal opportunities for all, Singapore cannot afford to turn inwards in the face of challenges such as technological and demographic change.

Instead, it has to continue to stay open and connected, continue to foster trust in society "and, above all, we must stay united as one people", said Mr Heng, who called on Singaporeans to see each generation as a set of relay runners who "always take good care of what we have inherited, run our best race and pass on a better future to those who come after us".

"This Budget is but one step in this long race, building upon the sweat and toil of generations who have run the race before us... Let us unite and forge ahead as One Singapore to build a better Singapore for tomorrow," he said.

GST hike can't be scrapped, money required for critical needs: DPM Heng Swee Keat
Heng explains why Govt cannot fund future expenditure with surpluses accrued this term
By Linette Lai, Political Correspondent, The Straits Times, 29 Feb 2020

The planned goods and services tax (GST) hike cannot be put off or scrapped because Singapore needs the money to pay for critical needs in future, especially the healthcare of an ageing society, said Deputy Prime Minister Heng Swee Keat.

And since all Singaporeans benefit from such spending, it is fair that everyone bears part of the costs, he added in his speech to round up the debate on the Budget yesterday.

"This is about all of us taking shared responsibility to pay for our needs and our society's needs, and sharing in the effort to provide for them," Mr Heng said.

He noted that the $6 billion Assurance Package and permanent GST Voucher scheme will ensure that the poor pay less than those who are well off, and delay the impact of the increase on most Singaporeans by five years or more.

In his speech, the Finance Minister laid out the rationale for raising the GST rate to 9 per cent by 2025.

National priorities such as healthcare, education and defence are best met by government provision through taxes, he said.

The Government also redistributes resources to give everyone a share in the fruits of progress.

And as Singapore's population ages, its healthcare needs will grow.

In 2000, healthcare expenditure was about 0.7 per cent of Singapore's gross domestic product (GDP). This went up to 2.1 per cent in 2015, as the Government ramped up measures to improve healthcare accessibility and affordability.

Mr Heng said that public healthcare spending as a proportion of GDP is expected to grow by one percentage point between 2015 and 2030. Singaporeans have to understand that this money must come from somewhere, he said.

"Our healthcare needs are not one-off needs. They are recurrent needs - meaning that these needs will be there year after year. In fact, growing year after year."

"We need to fund them using recurrent revenues, not one-off surpluses seen in this term of government," he said, noting that the surpluses were the result of unexpected rallies in the financial markets and the boom in the property market.

"We cannot hope to keep on being so pleasantly surprised," he said. "Things can very quickly swing in the opposite direction, as we have seen with the Covid-19 outbreak."

In fact, the outbreak is a reminder of why Singapore needs to plan ahead to raise revenues, he said.

"We must ensure that we have enough resources to meet our people's needs, driven by structural factors. Otherwise, we will find ourselves short and have to raise taxes or cut spending in difficult times, precisely when businesses and people need a boost."

He added: "Planning ahead entails being honest with ourselves and with citizens, and having the discipline to raise revenues in a timely manner."

Addressing questions on whether the Government can spend less, or more efficiently, Mr Heng said the Government is always looking for cost-effective ways to improve outcomes.

It already achieves good outcomes at a lower cost than in many other countries, he added.

"But efficiency savings will never be enough to fully offset the growth in healthcare spending as the population ages and medical sciences improve," he said.

"Efficiency savings can only mitigate this. To believe otherwise is wishful thinking."

Mr Heng also went on to explain why the Government cannot fund future expenditure using surpluses accrued during this term, as well as its stance on raising income and wealth taxes as a source of revenue.

During the three-day debate, MPs had also called on the Government to raise income and wealth taxes, rather than GST.

Mr Heng pointed out that such initiatives have been put in place over the past decade, while the GST rate has stayed at 7 per cent since 2007.

For example, the property tax regime was made more progressive in 2010 and 2013, while the top marginal personal income tax rate went up in 2015.

In 2018, the Government also raised the buyer's stamp duty rate for residential properties in excess of $1 million in value.

"But we should bear in mind that there is a limit to raising income taxes," Mr Heng said.

"If we keep raising income taxes, it will eventually hurt middle-class Singaporeans, who presently pay very light income taxes. It will also risk losing our ability to attract talent and keep our own talents."

He added that a fine balance has to be struck between Singapore's corporate income tax rate and economic competitiveness.

Many countries in the region and elsewhere have standard GST rates that exceed 9 per cent, he noted.

In Nordic countries, value added tax rates are as high as 25 per cent, and top personal income tax rates can exceed 50 per cent - which their people accept as the price for their higher social spending.

Mr Heng also made the point that the extra revenue from the GST hike will not be enough to pay for Singapore's increased healthcare spending needs.

"So we will continue to adjust our income and wealth taxes, to raise revenue in a progressive and fair manner," he said.

Taken as a whole, Singapore's tax system is progressive, he added.

"Lower-and middle-income households receive proportionately more benefits than the taxes they pay, whereas higher-income groups contribute a far higher share of taxes than the share of benefits they receive."

He added:"I hope that you will understand and appreciate the care and concerns behind the careful planning," he told the House. "If we did not care as much for our collective future, we would not have thought so long and hard, and expended so much political capital."

$6 billion Assurance Package will delay impact of GST hike for at least five years
By Yuen Sin, The Straits Times, 29 Feb 2020

The Budget's new $6 billion Assurance Package will effectively delay the impact of the goods and services tax (GST) increase for the majority of Singaporean households for at least five years, Deputy Prime Minister Heng Swee Keat said yesterday.

For lower-income Singaporeans, the offset will be even higher, and there will effectively be no increase for them for 10 years, said Mr Heng, responding to concerns raised by MPs during the debate on the Budget statement about the impact of the GST hike on households.

There have been questions over the logic of raising GST and providing an Assurance Package, and whether Singapore can delay or not even increase the GST rate, which will rise from 7 per cent to 9 per cent by 2025, noted Mr Heng.

But he clarified that delaying the GST increase is not the same as raising the GST and providing offsets because of the design of Singapore's system and the resulting incidence of the GST burden.

The GST Voucher scheme, which will be enhanced when the GST hike kicks in, reduces the net GST borne by lower-and middle-income households, said Mr Heng.

The net GST refers to the amount of GST borne by each household, after accounting for the GST Voucher it receives. On the other hand, foreigners do not benefit from the GST Voucher and offsets.

"When we eventually raise the GST rate to 9 per cent, foreigners pay the higher rate immediately," pointed out Mr Heng. "In contrast, Singaporeans receive offsets to cushion the impact, through both the permanent GST Voucher and the Assurance Package."

Administratively, this will also make it easier for Singapore businesses to implement the GST hike when it kicks in, said Mr Heng, as they make the changes to their IT systems only once.

Launched in 2012, the GST Voucher is given in three components - cash, Medisave top-ups and Utilities-Save (U-Save) rebates, which help households offset their utilities bills.

The Assurance Package means all adult Singaporeans will get cash payouts of between $700 and $1,600 over five years, so most households will get enough to offset at least five years' worth of additional GST expenses.

Those living in one-to three-room flats will get enough to offset about 10 years' worth.

More than 60% of net GST borne by high earners, foreigners
By Yuen Sin, The Straits Times, 29 Feb 2020

A significant part of the net goods and services tax (GST) is borne by foreigners and higher-income households, Deputy Prime Minister Heng Swee Keat said yesterday.

Net GST is the amount of GST each household pays after accounting for GST Vouchers they receive.

Responding to Mr Liang Eng Hwa (Holland-Bukit Timah GRC), Mr Heng said foreigners residing in Singapore, tourists and the top 20 per cent of resident households are estimated to account for more than 60 per cent of the net GST borne by all households and individuals.

This is after taking into account GST refunded under the Tourist Refund Scheme for goods bought here for consumption abroad.

"This is partly because foreigners do not benefit from the GST voucher and offsets, which are available only to Singaporean households," he said.

Conversely, the bottom 40 per cent of resident households are estimated to account for less than 10 per cent of the net GST borne by all households and individuals with the GST Voucher, he said.

The GST is only one part of Singapore's fiscal system, added Mr Heng, who is also Finance Minister.

The overall system of taxes and benefits is a progressive one, which sees those who are better off contributing more, and lower-and middle-income households receiving proportionately more benefits than the taxes they pay, he said.

The top 10 per cent of taxpayers pay about 80 per cent of Singapore's personal income tax revenue, he added.

Mr Heng highlighted a chart showing that lower-and middle-income households get proportionately more benefits than the taxes they pay, whereas higher-income groups contribute a far higher share of taxes than the share of benefits they receive.

The top 20 per cent of households by income pay 55 per cent of the taxes and get 12 per cent of the benefits, he said. The bottom 20 per cent pay 9 per cent of the taxes and get 28 per cent of the benefits.

"In designing our fiscal system, we have always sought to achieve a fair and progressive balance, where the better-off contribute more, and the lower-income receive more support," said Mr Heng.

"This overall philosophy is a key consideration in how we design the GST, and how we will implement the GST hike."

The GST is due to rise from 7 per cent to 9 per cent some time between 2022 and 2025.

Heng: Need to safeguard reserves, as past leaders did, so future generations benefit
By Linette Lai, Political Correspondent, The Straits Times, 29 Feb 2020

Tapping Singapore's reserves and the investment returns from these funds would be the easy way of paying for future spending, Deputy Prime Minister Heng Swee Keat said yesterday.

But the responsible thing to do is to steward this money properly for future generations, he added.

Mr Heng noted that the Net Investment Returns Contribution (NIRC) - the returns from Singapore's invested reserves - continued to be the top contributor to government coffers last year, accounting for $17 billion or 3.3 per cent of gross domestic product.

Most advanced countries use about 2 per cent of their GDP to service accumulated debt, he said.

"In most advanced countries, citizens today pay for the spending of the past generations. In Singapore, it is the reverse," he said. "Citizens today enjoy the benefits of the savings from the past, thanks to the foresight and policies of our founding generation of leaders and people."

He was responding to suggestions that the Government should tap national reserves to fund future spending, instead of raising the goods and services tax (GST).

Mr Heng noted that today, NIRC is more than personal income tax collections at $12 billion, and GST collections at $11 billion.

"So, if we did not have the NIRC, even doubling personal income tax, or doubling the GST rate to 14 per cent, would still not be enough."

"Tell me - in which other country are citizens able to reap the benefits of past savings in this way? So, let us never forget that what we have inherited is very unusual and very precious," he added.

On Thursday, Workers' Party Non-Constituency MP Leon Perera asked if Singapore could slow the rate of growth of its reserves, releasing more funds to invest in its people and companies.

Mr Heng replied that in 2015, a constitutional amendment was passed to add Temasek to the Net Investment Returns framework. This resulted in a significant increase in NIRC, which was used to develop capabilities for future growth, among other things.

He added that today, at $17 billion, the NIRC is able to cover almost the combined budget of the Ministry of Education and the Ministry of Trade and Industry.

"More importantly, our reserves give us the confidence - as a small country with no natural resources of any kind - to deal with the ups and downs in the world."

He cited how during the 2008 global financial crisis, then President S R Nathan approved the provision of $150 billion from past reserves to guarantee bank deposits in Singapore from Oct 2008 to Dec 2010. There was no bank run.

The money remained untouched and was returned to past reserves.

In 2009, Mr Nathan approved another $4.9 billion draw to fund the Resilience Package. A year later, after the economy rebounded, the Government decided to return the money used to the past reserves.

"It did not have to, but did so, to maintain the discipline that has allowed this unusual move in the first place," said Mr Heng.

This year, the Government has not had to tap on the past reserves. "It was the same spirit of prudence that allowed us to have enough surplus this term to provide the fiscal support for our economy and our people," he added.

"But if the situation deteriorates significantly and calls for us to tap our past reserves, I will make a case to the President to seek her approval to do so," he said.

Mr Heng stressed that the Government has a responsibility to future generations and must safeguard their interests. "So, let us continue to keep the discipline, and keep the faith and promise to future generations of Singaporeans, by stewarding our reserves well in our time."

DPM Heng Swee Keat to businesses: Be creative and seize opportunities
Having ecosystems for innovation and strong local capabilities is key to Singapore's success
By Choo Yun Ting, The Straits Times, 29 Feb 2020

Businesses must be willing to bear the transitional pains, to be creative and resourceful, and to seize opportunities where others see challenges, Deputy Prime Minister Heng Swee Keat told Parliament yesterday.

He said Singapore must move fast to secure growth and jobs in the new economic landscape or face irrelevance as the global economy undergoes major changes, noting that the Republic's journey of economic transformation began four years ago when the Committee on the Future Economy was formed.

These efforts have boosted productivity and created more and better jobs for locals, he added.

Last year, 51 per cent of full-time employed local workers earned a gross monthly income of at least $4,000, excluding employer Central Provident Fund contributions.

This compares with 37 per cent of local workers who earned at least $4,000 in 2010, in today's dollars after adjusting for inflation.

Mr Heng, who is also Finance Minister, pointed out that Singapore is acting swiftly to secure its external economic space, to create new opportunities and room for manoeuvre in an increasingly fragmented economic order. It is also boosting the innovation, growth and transformation capacity of its enterprises and industries, he said.

Building up strong local capabilities and ecosystems for innovation, he added, is critical to the nation's economic success and resilience.

Singapore has expanded its research and development investments into new areas and technologies, enabling it to transform its manufacturing and services sectors, as well as create new growth clusters in areas such as urban solutions and sustainability, and agri-food technology.

The Government is mobilising and partnering industries and firms to take ownership of their economic transformation, Mr Heng added. "Business leaders must have the mental agility and dynamism to experiment, and the resourcefulness to overcome constraints," he said, noting that these leaders will receive support from the Government from the Enterprise Leadership for Transformation (ELT) Programme, which was announced in this year's Budget.

Institutes of higher learning, such as the Singapore Management University, have also linked up with Enterprise Singapore (ESG) to support the ELT programme, and ESG will bring more partners on board the programme in the coming months, he said.

He pointed out that partnership among businesses at an industry level is also important. "Even as businesses compete with one another and seek to differentiate themselves, cooperation can help them do better, such as by forming alliances to capture opportunities overseas or collaborating to test-bed sector-wide solutions."

He cited the Singapore Poultry Hub - a joint venture among five poultry producers and processors - as another example of how collaboration between businesses reaped gains. "By working together, these poultry producers were able to achieve the scale needed to transform a labour-intensive process."

The hub's smart factory will harness emerging technologies to raise productivity by 26 per cent and production capacity by 70 per cent.

Mr Heng said the economic transformation efforts have begun to bear fruit. Besides more and better jobs being created, productivity has also grown in the last three years, and Singapore's enterprises are entering new markets.

The nation has continued to attract investment despite economic headwinds, with the Economic Development Board attracting $15.2 billion of investment commitments last year, and local employment has also grown in the last 10 years, he noted.

He said: "At its heart, economic transformation involves the courage to brave transitional pains as we change the way we do things.

"If we can all move forward with the can-do spirit of initiative and partnership that we have shown in the past weeks, I am confident we will build strong firms that can grow and compete in the global arena, and create good jobs for all Singaporeans."

Tackling climate change to secure Singapore's future
By Danson Cheong, The Straits Times, 29 Feb 2020

The efforts made to tackle climate change are long-term investments that represent the Government's commitment to coming generations of Singaporeans, said Deputy Prime Minister Heng Swee Keat.

This is an existential battle that Singapore, as a small, low-lying island state, is waging, and one that will take place over the long haul, he said yesterday in a speech to round up the debate on the Budget statement.

Fighting climate change was a major limb of this year's Budget. Mr Heng, who is also Finance Minister, had announced fresh measures to tackle this global problem, including phasing out petrol and diesel vehicles by 2040, expanding charging infrastructure for electric vehicles (EVs) and injecting $5 billion into a new coastal and flood protection fund.

"I could have chosen instead to spend it on more hongbao, or red packets, to make myself more popular," said Mr Heng, referring to the fund.

"But by making the commitment today, these resources will go towards pumps, tidal gates and infrastructure that will keep our children, and their children, safe from rising sea levels in decades to come."

Singapore, he said, has always risen to the challenge in the face of adversity and turned its "constraints into opportunities and strengths", as it has done in dealing with its limited water, land and manpower.

The country has an ambitious plan to meet the challenge of climate change, he added. "We are not only securing our coasts, but also transforming our sources of food and water, and remaking our entire economy and city for a green and sustainable future," he said.

The National Climate Change Secretariat is coordinating this inter-agency effort, he noted.

During the debate, MPs had asked about the Government's bet on electric vehicles (EVs), pointing out that a rebate it would offer on the Additional Registration Fee for such vehicles seemed insufficient.

Responding, Mr Heng said he expects the cost differential between EVs and conventional vehicles to drop as technology improves, but added that "a car-lite vision continues to be the main focus" of Singapore's transport policy. "While we want to encourage drivers to replace their internal combustion engine vehicles with EVs, we should bear in mind that the cleanest and most efficient mode of transport remains public transport."

MPs had also noted that the fight against climate change required a mindset shift among Singaporeans, and that everyone had to participate.

Agreeing, Mr Heng said this was a "whole-of-society, multi-generational effort" that could span 50 or even 100 years. "If we take the long-term view, and each generation plays its part, Singapore can face the future with confidence."

Strengthen social compact to ensure everyone benefits from Singapore's growth
By Sue-Ann Tan, The Straits Times, 29 Feb 2020

As Singapore presses on with efforts to transform the economy and develop workers, it also has to strengthen its social compact to ensure that the benefits of growth reach everyone, including low-wage workers, middle-income families and retirees, Deputy Prime Minister Heng Swee Keat said yesterday.

Mr Heng, who is also Finance Minister, said the Budget this year provides further support for those who may face greater pressures.

"Some face difficulties with employment and ensuring that growth in their income keeps pace with inflation, despite their best efforts," he noted.

Businesses and the community have a role to play as well, he added, noting that more organisations and groups have stepped forward in this regard.

Nominated MP Walter Theseira, Mr Zainal Sapari (Pasir Ris-Punggol GRC) and Mr Png Eng Huat (Hougang) had spoken on the vulnerabilities of low-wage workers during the Budget debate this week.

Mr Heng said the Care and Support Package, which includes grocery vouchers to help with daily necessities, will support these workers and their families.

These initiatives come on the back of efforts such as enhancing Workfare for low-income workers, the Progressive Wage Model, which provides a structure for workers in some sectors to earn more through skills upgrading, and ComCare, a fund that provides social assistance.

He noted that mayors and the five Community Development Councils have put in place local assistance schemes to support residents.

Retirees who had low income in their working years and little to no family support will also get extra help through the enhancements to Silver Support. This will benefit 100,000 more seniors and raise payouts by 20 per cent.

Middle-class families, who have to care for both their children and elderly parents, also get support, with more GST Voucher U-Save rebates for larger households and Passion Card top-ups for their parents.

Each parent with young or school going children will also get an extra $100 cash payout.

These measures are in addition to extensive subsidies in education, healthcare and public housing. Last year, middle-income households received $2 in benefits for every dollar in tax they paid.

Several MPs, including Mr Melvin Yong (Tanjong Pagar GRC), Mr Louis Ng (Nee Soon GRC) and Mr Desmond Choo (Tampines GRC), had spoken about the pressures these families can face. Mr Heng said: "Supporting and strengthening families will always be a priority for us, and we will continue to look at how to do so effectively.

"Overall, the measures we have put in place over the past decade to provide good jobs for our people, develop them at all stages of life and support the vulnerable have made a decisive impact in narrowing the income gap."

The Gini coefficient, which measures income inequality, after taxes and transfers, fell to 0.398 last year. This was the lowest since 2001.

Businesses and the community have growing roles to play as well in being inclusive and helping those in need through philanthropy and volunteering, said Mr Heng.

He noted that in 2018, individuals collectively donated $2.1 billion through registered organisations, more than double the $960 million donated in 2008.

Around one in two businesses here also gives back to the wider community through philanthropy and volunteering.

He also lauded the Nominated MPs for their work in various areas, from mental health to championing the arts.

"This is how we should rise to the challenge of inequality in this day and age - by coming together as one people to uplift the less privileged among us, with the state providing strong foundations of opportunity and support," said Mr Heng.

Embrace diverse views and political differences, says Workers' Party chief Pritam Singh
By Rei Kurohi, The Straits Times, 29 Feb 2020

Diverse views and political differences should be embraced in Singapore's democracy, said Workers' Party (WP) chief Pritam Singh.

He noted that unity has been a recurring theme of each year's Budget since 2016. But in seeking to engender a "Singapore Together" movement, the country's fourth generation leadership must also encounter "very diverse, edgy and even contradictory views in the effort to find common cause", he said.

This should be encouraged, not discouraged, he added yesterday during the debate on the Budget statement. "It is that process of embracing diversity and accommodating political differences that gives meaning to a democracy of deeds for the 21st century, and not for a one-party Parliament of decades past," said Mr Singh.

He said his party's MPs have raised issues that People's Action Party MPs "cannot be expected to raise, not out of an inability of their own, but because of the nature of politics and political contestation".

WP MPs agree with the Government when they have to and disagree when they must, he said, adding that they do so while endeavouring for the best outcomes for Singapore and for unity of purpose when politics has to take a backseat, like during the ongoing Covid-19 outbreak.

In his speech, Mr Singh addressed responses from businesses to the measures in the Budget and Singapore's fiscal position.

On measures to help tide businesses over the outbreak, he said private bus companies and drivers are bearing the brunt of cancelled trips and tours. "Private bus companies feel the Budget support package is not targeted enough in view of the nature of their business," he said.

Mr Singh also said he hopes the Government will reconsider its decision not to waive foreign worker levies for companies that have no choice but to hire foreigners, on condition that these firms "consciously seek to increase the local headcount by way of job redesign going forward".

On the fiscal position, he asked for updates on the Government's plans to study the option of using government debt to partially finance long-term infrastructure projects and on its consultations with businesses on implementing policies to prevent companies from shifting profits to lower-tax jurisdictions.

He also reiterated the WP's position on the planned goods and services tax (GST) hike, and said the party does not support it. He called for the Government to publicly release its revenue and expenditure projections so Singaporeans can evaluate the necessity of raising GST from 7 per cent to 9 per cent, which is scheduled to take place by 2025.

"I believe this openness would contribute to a more substantive conversation and understanding of our fiscal trade-offs. This can only advance and mature conversations that take place in Singapore," Mr Singh said. "Until this clarity is provided, the WP position has not changed. We cannot support a GST hike, especially since this is to be raised in advance, and before the Government's projections have been put to this House."

Government working closely with firms and workers to develop Singaporeans, says DPM Heng
By Joanna Seow, Assistant Business Editor, The Straits Times, 29 Feb 2020

The Government is committed to developing Singaporeans and is working closely with enterprises and workers to do so, Deputy Prime Minister Heng Swee Keat said yesterday.

This comes amid profound structural changes to the labour market and economy, such as an ageing population, multiple careers, and rapidly advancing technology and business models, he told Parliament.

Mr Heng said this tripartite approach has three prongs.

First, the Government is investing in enabling lifelong learning and smooth job transitions.

It is investing heavily in institutes of higher learning which, together with other training providers, offer a large suite of industry-relevant continuing education and training courses.

These courses are subsidised by up to 90 per cent and provide a key pathway for people to gain the skills and confidence to make career transitions and realise their aspirations, said Mr Heng, who is also Finance Minister.

He noted that the outcomes of the Adapt and Grow initiative are encouraging. It aims to help workers refresh their skills and move into new opportunities faster.

Career coaches work with about 27,000 job seekers every year, and in 2018 placed about seven in 10 of them within six months, said Mr Heng.

For workers who went through professional conversion programmes, about nine in 10 remained in employment two years after getting a job.

And seven in 10 also earned higher wages after starting their new jobs.

The new SkillsFuture MidCareer Support Package announced in the Budget will further help workers in their 40s and 50s, he said, noting that Workers' Party MP Sylvia Lim (Aljunied GRC) had spoken about the anxieties this group faces.

The second prong is the SkillsFuture movement to enable workers to take ownership of their own learning and growth.

Mr Heng had announced a $500 SkillsFuture Credit top-up for all Singaporeans aged 25 and up in the Budget speech, with an extra $500 for those aged between 40 and 60.

This can cover, for example, the $450 fee a Singaporean worker aged 40 or older would need to pay after a 90 per cent government subsidy for a $4,500 course in big data engineering for analytics, he said.

The labour movement is building on workers' efforts by helping them with job transition and upskilling through the Job Security Council and company training committees, he noted. The council was announced by labour chief Ng Chee Meng on Wednesday when he spoke during the debate on the Budget statement.

The third focus is on enterprises stepping up their transformation while redesigning jobs and upgrading workers.

Mr Heng said that the new $10,000 SkillsFuture Enterprise Credit and the expansion of the Productivity Solutions Grant to include job redesign consultancy services support this.

In response to Mr Ong Teng Koon (Marsiling-Yew Tee GRC), who raised the concern that smaller firms may have difficulty taking workers away from day-to-day business needs to go for training, he said "there is no better time than now".

"Many businesses are already making use of the downtime to accelerate change," he added.

Mr Heng said that besides these tripartite responses, the Government has also been investing upstream in education and housing.

For example, he said, by the time a Singaporean child reaches 16, he would have received more than $180,000 in education subsidies, including for pre-school. If he goes on to an institute of higher learning, he would receive a further $15,000 to $22,000 in subsidies each year.

More is being done to support students from low-and middle-income households, provide affordable and good quality pre-school education, and help students gain cross-cultural skills to navigate the new economy.

Meanwhile, housing subsidies allow new Housing Board flats to be sold below market rate, and a resale flat can cost less than five times the annual salary of a median-income household, which is much lower than in other cities such as Hong Kong, Sydney, London or New York, said Mr Heng.

"By intervening upstream in these areas, we provide a foundation of broad-based opportunities that enable everyone to earn their own success," he said.

All these efforts enable Singaporeans to enjoy the fruits of progress, said Mr Heng, citing the fact that resident employed households have seen median real income rise by 3.7 per cent per year over the last decade - higher growth than that of many other advanced economies.

"In short, our approach to these changing times is to take structural measures to strengthen opportunity at every stage of life, with all individuals, employers, unions doing their part," he added.

"If we can all take on a mindset of growth and a spirit of resilience, we can be assured that we will emerge stronger and better to face the future ahead."

Swift action, anchored in time-honoured principles
It is comforting to know the nation's finances are not subject to just the need of the hour
By Grace Ho, The Straits Times, 29 Feb 2020

In an age of political bluster - think British Prime Minister Boris Johnson or the current state of American politics - yesterday's cerebral and impactful Budget round-up speech seemed almost anachronistic.

Was it long? Yes. Clocking in at over two hours, it was longer than the 90 minutes Deputy Prime Minister Heng Swee Keat dedicated to it last year, partly due to new actions to cope with the immediate coronavirus outbreak, as well as an in-depth explanation of core principles.

When he paused around the 90-minute mark and members thumped their armrests, he said to laughter: "I have not finished. I told you I have two files."

Files which - in characteristic conscientious fashion - he was seen scribbling in, almost right up to the moment he took the podium.

The meat was in the message - serious but not hectoring, encouraging but not grandstanding, and anchored in principles for the ages.

Above all, it was anchored in action. Mr Heng came out of the gate swinging with a swift response to MPs' calls to speed up the flow of the Jobs Support Scheme payout.

Just two days ago, MPs Saktiandi Supaat (Bishan-Toa Payoh GRC), Seah Kian Peng (Marine Parade GRC) and Gan Thiam Poh (Ang Mo Kio GRC) had asked that the scheme, which will offset 8 per cent of wages for every local worker for three months, be brought forward from end-July.

This would help preserve businesses and jobs for those who cannot wait another five months, they had said. That recommendation was taken in yesterday, with payments to start from end-May.

Mr Heng gently explained that government agencies had "redoubled efforts" in response to businesses' feedback, and that the payments are operationally complex due to the need to check and validate workers' and employers' information, as well as the payment mode.

On the second day of the Budget debate on Thursday, Nominated MP Walter Theseira, in one of the most lucid and powerful Parliament speeches in recent memory, had urged the Government to intervene and raise the pay of those "whose market prices are low but social value immeasurable".

He said the viral outbreak has shown that market-determined salaries of workers such as cleaners, security officers and healthcare workers have diverged from the value that they provide to society.

The Government's response has been to put its money where its mouth is. Mr Heng announced yesterday that public officers manning the front line in Singapore's battle against the viral outbreak, including healthcare officers in restructured hospitals, will get up to one extra month of special bonus.

In a move that took many by surprise, he added that all political office-holders will take a one-month pay cut in solidarity with Singaporeans coping with the outbreak. President Halimah Yacob had informed him that she will take a similar one-month pay cut, Mr Heng added.

On how to provide for the nation's future, it was almost inevitable that the subject of the goods and services tax (GST) increase would come up. The GST rate is slated to go up from 7 per cent to 9 per cent between 2022 and 2025.

Before the round-up speech, Workers' Party chief Pritam Singh stated for the record that his party's objection to the GST hike has not changed, in the absence of publicly available revenue and expenditure projections that would enable Singaporeans to "critically evaluate" the need for such a hike.

What followed was a flurry of slides and charts as Mr Heng explained the reasons and trade-offs. The arguments are well trodden - the need for recurrent revenue to meet recurrent expenditure, especially in healthcare, and the suitability of broad-based taxes like the GST to pay for societal and structural needs.

He was candid about the sheer amount of political capital expended on the issue, adding: "This is about all of us taking shared responsibility to pay for our needs and our society's needs."

Pointing out that the $6 billion Assurance Package and permanent GST voucher scheme effectively delay the impact of the hike for most Singaporeans for at least five years, he said: "When we eventually increase the GST rate to 9 per cent, foreigners pay the higher rate immediately. In contrast, Singaporeans receive offsets to cushion the impact."

He also said he would seek the President's approval to draw on Singapore's past reserves if the coronavirus situation deteriorates significantly and calls for it.

But until then, the use of the reserves and investment returns from them must be safeguarded, he said, noting that the Net Investment Returns Contribution (NIRC) today, at $17 billion, is more than personal income tax collections at $12 billion, and GST collections at $11 billion. "So, if we did not have the NIRC, even doubling personal income tax, or doubling the GST rate to 14 per cent, would still not be enough.

"Our reserves generate substantial returns, which help to keep our taxes low. In other words, in most advanced countries, citizens today pay for the spending of the past generations. In Singapore, it is the reverse."

Citing founding Prime Minister Lee Kuan Yew, Mr Heng asked: "What is the deepest obligation of any government? It is not to the present, and certainly not the past, but to the future."

Interminable speeches, tough questions and a fastidious attention to detail have been the hallmarks of Singapore's Budgets. Yesterday was no different.

It may not make for good public spectacle, yet there is comfort in knowing that the country's finances are not subject to just the need of the hour.

If the short-term measures are the topsoil to sustain businesses and workers through this annus horribilis, then the reserves and investment returns from them - and the state's exacting care in preserving these rainy-day savings - are the bedrock of a Republic whose survival was never founded on being the coolest kid on the block.

Lawrence Wong warns of pressures on long-term returns under the Net Investment Returns Contribution (NIRC) framework
Do not take our fiscal strength for granted
By Aw Cheng Wei, The Straits Times, 29 Feb 2020

The returns from investments by sovereign wealth funds may be affected by global pressures, and that is why Singapore should not take its fiscal strength for granted, said Second Minister for Finance Lawrence Wong yesterday.

He was responding to Mr Liang Eng Hwa (Holland-Bukit Timah GRC) on future returns under the Net Investment Returns Contribution (NIRC) framework, given the tougher investment climate and the economic fallout from the coronavirus outbreak.

Under the NIRC framework, the Government can spend half of the long-term investment returns generated by the Monetary Authority of Singapore, Temasek and GIC - the three entities tasked to invest the reserves.

Speaking during the debate on the Finance Ministry's budget, Mr Liang noted that revenue estimates for the NIRC have grown to $18.6 billion for this financial year from $17 billion last year.

He asked if such continued growth is realistic and sustainable, given the "grimmer outlook, with the Covid-19 fallout and longer-term global structural stresses".

Mr Wong said the NIRC is tied to long-term expected returns, and is not linked to short-term performance. "It is not impacted by immediate market volatilities."

But the minister acknowledged that "there are indeed reasons for concerns, and we do expect more pressures in the longer-term investment environment".

An example is the geopolitical tensions between the United States and China, he said, noting that the contestation between the two powers may lead to a more bifurcated world over a period of time.

"We will likely see more nationalist and protectionist pressures continuing, which means that the pace of globalisation will slow. We may even get deglobalisation, which will cause global growth to be lower for longer periods of time," said Mr Wong, who is also National Development Minister.

Another effect is lower productivity and stagnating growth in developed markets with ageing populations, he said.

"So, if you think about these long-term trends, then indeed there will be continued pressures on our long-term expected returns," Mr Wong said. "We are very mindful of that, we stay vigilant, we do not assume that our NIRC will always be able to keep pace with our spending needs."

Workers' Party chief Pritam Singh (Aljunied GRC) asked how the Government decides when to borrow money for projects and when to make upfront payments.

Replying, Mr Wong said the Government will borrow for selected major infrastructure projects.

He noted that some major infrastructure projects will last across generations, and it is more equitable for the Government to borrow and spread out the repayment over the lifespan of such projects, so that both current and future generations will pay for them.

Fiscal sustainability key in light of virus fallout: Lawrence Wong
By Aw Cheng Wei, The Straits Times, 29 Feb 2020

The economic fallout from the coronavirus outbreak has underscored the importance for Singapore to ensure its long-term fiscal sustainability, Second Minister for Finance Lawrence Wong said in Parliament yesterday.

He told the debate on the Finance Ministry's budget: "Our prudent fiscal strategy has provided us with the resources to respond promptly and decisively to crises, and also to continue investing for the future and the long term."

The Budget on Feb 18 set aside $6.4 billion to implement measures to help Singapore combat the fallout from the virus outbreak.

MPs such as Mr Saktiandi Supaat (Bishan-Toa Payoh GRC), Mr Liang Eng Hwa (Holland-Bukit Timah GRC) and Ms Foo Mee Har (West Coast GRC) asked about the Government's spending and its accountability during the Budget debate.

Mr Wong, who is also National Development Minister, said that Singapore had built its resources over several decades thanks to judicious fiscal policies put in place by Singapore's pioneers.

He noted that the country is a small one with no natural resources and exposed to global forces beyond its control, making it especially important for Singapore to continue with its sound fiscal approach to maintain its strong financial position.

Singapore's investment in economic transformation is starting to bear fruit, he said in response to Ms Foo, who asked about the measures Singapore used to track the success of business investments.

Mr Wong said that overall productivity growth, as measured by real value-added per actual hour worked, rose to 2.6 per cent per year in the past three years, up from 2.2 per cent in the preceding three-year period.

The Government will invite industry experts to form an infocomm technology (ICT) advisory panel to evaluate major government projects and ensure their cost-effectiveness, Mr Wong added.

This initiative builds on the success of an earlier project that called on technical experts from academia and the private and public sectors to review large infrastructure projects before they get the go-ahead.

"Over the past five years, these processes have led to design improvements and generated savings of about $3.5 billion for infrastructure projects," Mr Wong added.

So far, the review processes for ICT projects have managed to save $900 million - or 6 per cent - over the past five years, and he hopes that the upcoming panel will further ensure cost-effectiveness.

But the best way to ensure prudence and effective spending is to instil a value-for-money mindset in every public officer, Mr Wong acknowledged, in a nod to Ms Foo's and Mr Liang's suggestions.

"This is a continual work-in-progress, but we have seen improvements over the years," he said.

One way is to set outcome-based measures as the Ministry of Transport (MOT) has done by using the percentage of commuters' journeys completed within 45 minutes as a key performance indicator, said Mr Wong. The MOT also conducts value-for-money workshops for officers to share ideas and best practices.

Coronavirus concerns present long-term opportunities, say MPs
These include prompting businesses to adopt e-commerce and diversifying supply sources
By Tiffany Fumiko Tay, The Straits Times, 28 Feb 2020

While the coronavirus outbreak has battered businesses, it has also created opportunities to better prepare Singapore for future challenges, MPs said yesterday.

Speaking on day two of the debate on the Budget statement, they said these include getting more companies to adopt e-commerce, diversifying supply sources as well as making flexible work arrangements permanent for working parents and caregivers.

Fifty-four MPs, including political office-holders, spoke over two days on various aspects of the Budget.

Mr Christopher de Souza (Holland-Bukit Timah GRC) said the shortage of surgical masks highlights the need to diversify Singapore's supply sources as the virus affects the global trade of goods and supplies.

While the Government has announced its intention to seek new sources and look into manufacturing masks locally, "we need to take stock of what other items, besides masks, we potentially need to manufacture on our own in the future", he said.

Pointing to companies that face difficulties in diversifying their supply sources, Mr de Souza asked whether government support is available to help them connect with more diverse trade partners.

Business continuity plans put in place by many companies in recent weeks also provide an opportunity to test whether flexible working arrangements are feasible, he said.

"If it works, more firms may be ready and confident to try adopting it as an available standard practice to support our working parents with young children and working caregivers."

Mr Chong Kee Hiong (Bishan-Toa Payoh GRC) asked for more support for companies that are adopting or expanding e-commerce operations.

"This crisis provides the impetus to push SMEs which have been reluctant to consider this sales avenue," he said, referring to small and medium-sized enterprises.

Ms Tin Pei Ling (MacPherson) called for more recognition and support for freelancers, whom she said are especially vulnerable to changes in economic conditions.

Many have little in terms of savings to see them through a work drought, she said, noting that a number of events and work assignments have been cancelled or deferred as a result of the coronavirus outbreak.

She asked whether working capital loans or other measures aimed at helping businesses with cash flow issues could be extended to freelancers as well.

Noting that many freelancers are engaged by government departments, Mr Ang Wei Neng (Jurong GRC) asked if they can be paid up to half of their fees when large events are cancelled because of the virus.

Some MPs also echoed calls by those who spoke on Wednesday in urging more immediate and extensive financial support for companies and employees.

Mr Chong asked if the Jobs Support Scheme, which will offset wages of local employees for three months ending last December, could be extended to businesses that began operations this year.

Ms Foo Mee Har (West Coast GRC) asked whether Deputy Prime Minister Heng Swee Keat would consider a second relief package, if warranted. "With the $7.7 billion of Budget surplus left for this term of government to tap, DPM Heng has ample ammunition to do more," she said.

Mr Ong Teng Koon (Marsiling-Yew Tee GRC) said he had received feedback that the measures in the $4 billion Stabilisation and Support Package are adequate for small firms, but not medium-sized ones.

The cap for the corporate income tax rebate, for example, is $15,000 - a drop in the ocean for a medium-sized company, he said, adding that assistance should be calibrated to the size of an enterprise.

Mr Ong also asked how cash flow assistance can be sped up, given that many businesses are now running down their reserves while their suppliers are unable to extend credit.

At least six MPs also praised front-line workers such as doctors, nurses and cleaners, with many calling for stronger social and financial support for those most directly exposed to the virus.

Nominated MP Mohamed Irshad said the bonuses of healthcare workers may be impacted if hospital revenues take a hit from the outbreak. "Given the extraordinary circumstances, I hope the Finance Minister will consider extending financial support or even bonuses to our nurses and doctors who are in the front line," he said.

Fellow Nominated MP Walter Theseira pointed out the disparity between the wages that workers such as cleaners earn and the social value that they bring, particularly during a public health crisis.

The solution to the imbalance, he said, is to increase the wages of lower-paid workers.

This could be paid for by restructuring wages for higher-paying jobs, including those held by parliamentarians who are leaders in their own professions, said Associate Professor Theseira, who teaches economics at the Singapore University of Social Sciences.

"Today, we commend our cleaners and security guards, nurses and public health workers, for being in the front line of protecting us against Covid-19. We acknowledge the work of our public transport workers, our hawkers and shopkeepers, in keeping our supply lines and daily life running as normal.

"Can we give them a tangible increase in their salaries to acknowledge their sacrifices?" he said.

Mr de Souza, who was the last to speak yesterday, said a crisis can bring out the best and worst in a society. While there may be disagreements on fiscal measures and social policy, how these differences are resolved is key, he said.

He noted that many of his colleagues' speeches featured the undercurrent of unity, with Workers' Party MP Png Eng Huat (Hougang), for example, highlighting the need to unite rather than point fingers and stigmatise.

DPM Heng will respond to the MPs when he rounds up the Budget debate today.

Do more for vulnerable, lower-income so they'll never walk alone: MPs
In Budget debate, MPs also call for more support for the disabled, caregivers, parents
By Grace Ho, The Straits Times, 28 Feb 2020

If Wednesday's Budget debate appealed to the head, dissecting specific measures with surgical precision, then yesterday's exchange spoke directly to the heart.

Drawing from world history, deeply personal accounts and even a football club song, MPs called for more support for the vulnerable, caregivers, parents and the disabled.

Quoting the lyrics from the Liverpool FC anthem, You'll Never Walk Alone, Ms Lee Bee Wah (Nee Soon GRC) urged the House to soldier on through the coronavirus crisis. "I won't sing, I can't and I don't want to empty this house," she said, to general mirth.

"Thank you very much," responded Speaker Tan Chuan-Jin with mock relief.

Pushing for paid parent-care leave to be extended to the private sector, Mr Louis Ng (Nee Soon GRC) had to pause during his speech to compose himself.

Voice quavering, he recalled how, five years ago, he was told his father had lost consciousness - just as he was about to leave his house to visit him in hospital.

"Spend time with those you love and remember that life is a one-way ticket," he entreated.

He also asked that childcare sick leave be provided on a per-child basis, something already practised in the public service. "You can't only need six days of childcare leave for two, or three or four children. It may make sense if you can make sure all your children fall sick at the same time, which is not quite possible."

Nominated MP Yip Pin Xiu called for a national code on addressing campus sexual violence, and more support for those who do the "invisible and thankless" work of caregiving. Workplaces, she said, can accommodate caregivers through flexi-work arrangements and care options made more affordable.

Persons with disabilities were also highlighted by Ms Rahayu Mahzam (Jurong GRC) and Ms Cheryl Chan (Fengshan), who urged the authorities to streamline and customise support for them, and make infrastructure such as playgrounds more inclusive of children with different abilities.

A fundamental gap is society's lack of a culture of care and compassion towards such persons. It is no surprise, then, that their parents worry they cannot meaningfully integrate into the community and be given good opportunities, they said.

The discussion took a historical turn with NMP Walter Theseira. Citing the plague of the 14th and 15th centuries, he said it destroyed not only populations, but also the existing social and economic order throughout Europe.

Drawing parallels to today's coronavirus outbreak, he pointed out that China's sweeping policy decisions to contain it have essentially decoupled the trade giant temporarily from the global economy. "For (Singapore's) part, we should take this opportunity to strengthen weaknesses in our economy and society... and our resilience to future ones."

In a tour de force deconstruction of how market prices and social value have diverged, he argued that the front lines of the war against the coronavirus are increasingly manned by people - such as nurses, cleaners, public transport workers and security guards - whose market prices are low, but whose social value is immeasurable.

In a public health crisis, the pressure on the public healthcare system to be efficient comes at a cost to the resilience and morale of healthcare workers, he said. "The lack of slack means... we risk having insufficient spare capacity to deal with unexpected surges in demand. We must then rely on our existing manpower and resources to work overtime to keep us safe."

Yet, he observed, income inequality persists for such groups. "Can we give them a tangible increase in their salaries to acknowledge their sacrifices?"

This, he ventured, could be paid for by restraining and restructuring the pay of those higher up, including members of the House as leaders in their own professions.

Rounding up the list of 54 speakers over two days of debate on the Budget, Mr Christopher de Souza (Holland-Bukit Timah GRC) supported the calls against stratification, or seeing certain jobs as being intrinsically better.

"(Covid-19) is proof that everyone has a role to play, everyone is needed," he said.

Yesterday's debate was a plea for more help for the disenfranchised, lower-income and voiceless. But for them to have a voice, state intervention can only go so far.

Even as the war against the coronavirus rages outside, the war against social stratification begins at home. As Ms Cheryl Chan said, there is "no need for cold stares or harsh words" - be it towards nurses in uniforms on the MRT or disabled persons.

How apt, then, that this year's Budget has been called a "unity Budget" - not just in a nod to big and bold fiscal measures, but also a call to Singaporeans to play their part in strengthening social resilience.

More room to help workers upskill with SkillsFuture
By Sue-Ann Tan, The Straits Times, 28 Feb 2020

MPs welcomed Budget measures such as the $500 SkillsFuture credit top-up for all citizens aged 25 and older, with an additional $500 for those aged 40 to 60, but said more could be done to help workers make use of the credit to get relevant skills for the future.

Nominated MP Mohamed Irshad was concerned the scheme was not maximising the potential of all Singaporeans. He noted those above 60 do not get the extra credit.

He proposed structured apprenticeship programmes that can end with a full bachelor's degree or industry-recognised standards and qualifications. The apprentice can earn a decent wage while being trained, he said, adding he was confident participation rates would rise if such pathways are available.

E-learning and online courses might also help workers upskill while they continue with their daily schedules, especially for those on shift work, he added.

Ms Tin Pei Ling (MacPherson) said more targeted initiatives are needed for Singaporeans to pick up essential skills quickly.

Freelancers also need more recognition and support, she added, noting that they are especially vulnerable in the current environment.

"Many events and work assignments are cancelled or deferred as a result of the Covid-19 outbreak. They have little savings to see them through this period of work drought. Many of the financing options available are not accessible to them as they are not registered companies," she said.

"Could the Government consider extending the working capital loan to this group of freelance workers? Or help them access the other measures aimed at helping businesses with cash flow to keep them afloat as well?"

Ms Lee Bee Wah (Nee Soon GRC) said a pipeline of local talent has to be ensured, especially for industries that are seeing their foreign worker quotas being cut. A cut in the quota for S Pass workers was announced in the Budget statement for the construction, marine shipyard and process sectors.

"It is good the Government has a long-term view to reduce Singapore's reliance on foreign labour. But if we do not have a pipeline of Singaporean labour for construction and shipyards, then cutting the (quotas) might be an additional burden on companies. This could leave the companies no choice but to relocate out of Singapore," she said.

She added that relief measures like those for the hospitality and retail sectors affected by the Covid-19 outbreak should be considered for the property and construction sector. "This sector also holds a lot of jobs and should not be neglected."

NTUC piloting Job Security Council with 4,000 companies to match retrenched professionals, managers and executives (PMEs) to vacancies
By Joanna Seow, Manpower Correspondent, The Straits Times, 27 Feb 2020

The labour movement is bringing together 4,000 companies of various sizes to help place retrenched professionals, managers and executives (PMEs) in new jobs - fast.

A new Job Security Council will gather information on their job vacancies, jobs that can be redesigned as well as jobs being phased out, and match workers from "releasing" companies with "receiving" companies, said National Trades Union Congress (NTUC) secretary-general Ng Chee Meng in Parliament yesterday.

The 4,000 companies across various sectors employ a total of about 500,000 workers, and 90 per cent of them are small-and medium-sized enterprises. Some on board are engine maker Rolls-Royce and bakeries Swee Heng Bakery and Montreux Patisserie.

Mr Ng said the move comes amid growing concern among workers, usually those in their 40s to 50s, as PMEs are asked to go because their skills have become redundant. They may take a long time to find another job and it may not pay as well or fully utilise their skills.

"Although these numbers are not large, for the individual worker or PME, who has mouths to feed and bills to pay, the situation can create a lot of fear and anxiety," Mr Ng said during the debate on the Budget statement.

"We believe that job security is the umbrella that protects our workers from passing thunderstorms."

The council, staffed by NTUC's Employment and Employability Institute (e2i), will start a pilot run immediately and build on the trust between companies and NTUC to gather the necessary information.

Mr Ng, who is Minister in the Prime Minister's Office, said it will help companies identify the skill gaps of new workers so that they can be trained, and recommend government schemes they can tap.

In his speech, he also gave an update on NTUC's company training committee initiative, which was started last year with the aim of forming 1,000 such groups in three years. The committees comprise company and union representatives who together plan and execute targeted training for workers to prepare them for business transformation.

They have the added benefit of providing a ready-made avenue for management to discuss issues, such as manpower and cost concerns owing to the Covid-19 situation, with the union, said Mr Ng. He said 352 committees have been formed so far.

During the current lull, union leaders are also helping firms arrange for subsidised training for workers through NTUC LearningHub and e2i, he added.

Mr Ng noted that the coronavirus outbreak, which originated in Wuhan in China in December and has spread to more than 30 countries, has a deeper and more wide-ranging impact on the Singapore economy compared with that of the severe acute respiratory syndrome outbreak in 2003.

He lauded the "strong Budget" which he said reflects a whole-of-government approach to tackling the virus and maintaining workers' confidence in the economy.

"In Singapore, we enjoy the fruits of hard-earned tripartism, which has brought us economic resilience and social stability. Underpinned by this year's strong Budget, all these will ensure that Singaporeans' lives are uplifted together," he said.

Other MPs also spoke about the importance of job security amid the ongoing economic uncertainties.

Ms Jessica Tan (East Coast GRC) said while training and reskilling are important, these need to be aligned to job opportunities for workers.

"If many are trained and are not able to find suitable employment, we may have a situation in which there is even greater frustration and anxiety," she said.

Call for speedier, extensive aid for firms, staff and the vulnerable
By Tiffany Fumiko Tay, The Straits Times, 27 Feb 2020

Hastening support for businesses and workers and expanding the coverage for vulnerable groups are among the suggestions made by Members of Parliament to help those hit hard by the coronavirus outbreak cope in the short term.

Speaking during the debate on the Budget statement yesterday, MPs said that while the $4 billion Stabilisation and Support Package for firms and employees announced by Deputy Prime Minister Heng Swee Keat last week was comprehensive, more immediate and extensive help may be needed.

Mr Gan Thiam Poh (Ang Mo Kio GRC) was among several who called for bringing forward the payouts for the Jobs Support Scheme, which will offset 8 per cent of wages for every local worker for three months. Payment will be given to employers by the end of July this year.

"Many of the smaller companies are already struggling to remain in business, and it would be tough for them to wait for another five months," he said.

Mr Patrick Tay (West Coast GRC), assistant secretary-general of the National Trades Union Congress (NTUC), proposed reinstating NTUC's Surrogate Employer Programme, which was implemented during the severe acute respiratory syndrome crisis in 2003.

Acting as a "surrogate employer", NTUC provided course fee funding and training allowances to workers whose companies could not sponsor their training. This included tour guides and workers put on unpaid leave.

"I see a good opportunity for us to revisit and reintroduce this scheme to support workers who may fall through the cracks, or those not covered under current schemes, such as our freelancers and self-employed Singaporeans," Mr Tay told Parliament.

Several MPs asked that support measures be extended to cover more sectors and vulnerable groups of workers.

Mr Saktiandi Supaat (Bishan-Toa Payoh GRC) asked if the temporary bridging loan programme for businesses in the tourism sector could be offered to those in the four other sectors that have been badly hit - aviation, retail, food services and point-to-point transport services.

Senior Minister of State for Trade and Industry Koh Poh Koon noted that while these sectors feel the impact of the virus spread most acutely, the prolonged shutdown of factories in China has disrupted supply chains around the world, causing knock-on effects on other industries.

"The manufacturing and service sectors are also facing a manpower squeeze as many workers from China are unable to return to Singapore for work. This adds extra pressure on our already tight labour market," he said.

"I hope that the Government can pay special attention to sectors that may feel the downstream ripple effects of Covid-19, especially if the situation is protracted."

Freelancers and the self-employed are particularly vulnerable to losses of income during the current situation, and more must be done to help them, MPs said.

Mr Gan noted that these workers will not be eligible for the various assistance schemes announced in the Budget.

"For example, many tourist guides are self-employed. Would the Government roll out measures to help them find other interim and part-time jobs?"

Ms Denise Phua (Jalan Besar GRC) said that many Singaporeans are concerned about a prolonged outbreak and how long the Government will be able to sustain large deficits.

"What will an extended Stabilisation and Support package look like? How will it be further financed if the impact is even more broad-based than the tourism and transport sectors directly hit by the outbreak; when supply chains continue to be disrupted; when consumer sentiment and demand continues to decline; and companies start to shed their local manpower?"

Dr Teo Ho Pin (Bukit Panjang) suggested that the Government aid struggling businesses by boosting consumer demand. Firms can entice consumers by giving them shopping vouchers and discount coupons for air tickets and hotel stays, while matching grants can be given to businesses, he said.

A total of 31 MPs, including office-holders, spoke yesterday, and the debate is set to continue today.

DPM Heng is expected to respond to the suggestions when he rounds up the Budget debate tomorrow.

Preserving local jobs a key priority, says Manpower Minister Josephine Teo
Manpower Minister says waiving foreign worker levies would go against govt aims
By Sue-Ann Tan, The Straits Times, 27 Feb 2020

A key priority for this year's Budget is to preserve local employment, move businesses to be less reliant on foreign workers and spur them to transform, said Manpower Minister Josephine Teo yesterday.

That is why foreign worker levies were not waived, she added.

She noted that businesses had hoped for a waiver or reduction in the levies as the coronavirus outbreak rocks the economy, but such a move would have run counter to the Government's two objectives.

"First, in supporting businesses, our priority was also to preserve local employment,'' she said in Parliament in her response to a call for a waiver by MPs.

"Second, as much as we want to help businesses, measures to deal with the short-term fallout should not negate longer-term efforts for companies to become less reliant on foreign manpower for growth."

MPs, including Mr Seah Kian Peng (Marine Parade GRC) and Mr Saktiandi Supaat (Bishan-Toa Payoh GRC), had asked for the waiver for sectors hit hard by the outbreak, such as food services and retail.

"In light of the difficulties experienced across many sectors, we have to ensure that the continued shift away from employment of foreign workers is conducted in a sustainable manner," said Mr Saktiandi.

Mrs Teo said the ministry is waiving levies for employers whose foreign workers with a travel history to China must serve a quarantine, leave of absence or stay-home notice.

Levies have not changed since 2017 for the construction sector, and for others, since 2016 or earlier.

To reduce reliance on foreign workers, a cut in the quota for S Pass workers was announced during the Budget statement on Feb 18 for three sectors: construction, marine shipyard and process. S Pass workers are mid-skilled foreigners earning at least $2,400 a month.

The cuts to the S Pass sub-dependency ratio ceiling (DRC) - the proportion of S Pass holders a company can employ - will be done in two phases. The first will reduce the sub-DRC from 20 per cent to 18 per cent on Jan 1 next year. The second will slice it to 15 per cent on Jan 1, 2023.

Mrs Teo noted that employers already have short-term flexibility in meeting foreign workforce criteria under such schemes as the Capability Transfer Programme, which helps companies bringing in foreign specialists or sending Singaporeans abroad to improve their expertise.

She also said the quota varies among sectors, given the differing appeal of jobs.

In construction, for every 100 workers, up to 87 can be foreigners, of which 15 can be S Pass holders, from 2023. But in services, the quota will be lowered from next year. A same-sized company can then have up to 35 foreign employees, of which 10 can be S Pass holders.

Mrs Teo said: "Beyond these gradations, we should be realistic. Which sub-sector or occupation will accept having more restrictions compared to others that have less?"

She added: "Consider the longer term, too. Can we be so sure that foreigners will always accept the work conditions our own people find unappealing, or that they will not find better jobs back home in time to come?"

Instead, the focus is to help employers reach out to fresh graduates and mid-career employees switching jobs, she told the House. Employers can also help by transforming their businesses and making such jobs more attractive.

"Waiving or cutting levies would blunt the motivation to restructure, improve job quality and become more manpower-lean. We would not have seen how industries can rise to the occasion," she said.

"In the last few years, I have witnessed the resolve and creativity of hoteliers to overcome their manpower constraints... Likewise for other sectors, we should try our best to position ourselves for the future even when the chips are down."

Financial discipline, prudence have paid off for Singapore: MPs
By Linette Lai, Political Correspondent, The Straits Times, 27 Feb 2020

The $6 billion set aside to offset the planned increase in the goods and services tax (GST) will mean its impact on people will not hit home for five years, said Mr Liang Eng Hwa (Holland-Bukit Timah GRC) yesterday.

In his speech kicking off the marathon debate on Budget 2020, Mr Liang said Singapore's financial discipline and prudence had paid off, a point echoed by several other MPs in Parliament.

Mr Liang, who chairs the Government Parliamentary Committee for Finance and Trade and Industry, said new healthcare facilities costing millions of dollars are being built in his constituency. These include a 12-storey polyclinic and several senior care centres.

"While I dislike seeing the GST rate increase, I do understand that the Finance Minister would need additional funding to help pay for these new expenditures as well as other increased spending in social areas, education, security," he said.

The existing "massive and almost permanent" measures, such as vouchers, to offset GST mitigates the impact of the tax on lower and middle-income households, he added.

Under the new Assurance Package in Budget 2020, most households will get extra money to offset at least five years' worth of additional GST expenses when the tax hike kicks in by 2025.

Those living in one-to three-room flats will get enough to offset about 10 years' worth.

This year's Budget - a "headline grabber", said Mr Murali Pillai (Bukit Batok) - amounted to $106 billion. But he and other MPs said it still did not require a draw on Singapore's reserves.

Singapore's "disciplined and prudent financial management", combined with the Net Investment Returns Contribution (NIRC) from invested reserves, has allowed the Government to mount a robust response to the current situation, Mr Liang said.

"We have benefited from careful and tactical planning which ensures that we accumulate and set aside surpluses for a rainy day," added Ms Joan Pereira (Tanjong Pagar GRC). "Thus, we are much better prepared to weather this storm of global uncertainty, economic shifts and the Covid-19 outbreak."

Mr Liang noted that there are constant calls for the Government to spend more, given NIRC funds and the overall Budget surplus each year.

"It is always tempting to be nice and popular; and spend more today and worry about tomorrow later. Fortunately, this is not the case for Singapore's Ministry of Finance," he said.

Former ministers, Yaacob Ibrahim, Lim Swee Say express confidence in 4G leadership
By Lim Yan Liang, Assistant Political Editor, The Straits Times, 27 Feb 2020

Two former ministers yesterday expressed their confidence in the way Singapore's fourth-generation (4G) leaders have handled the Covid-19 outbreak, while urging them to take heed of its lessons and the key principles that have guided earlier governments.

While Budget 2020 has a suite of measures to stabilise the economy and help those hit by the coronavirus outbreak, measures such as the plan to phase out internal combustion engine vehicles by 2040 and an increased budget to strengthen cyber-security capabilities show that the Government is also keeping an eye on the future, said former minister for communications and information Yaacob Ibrahim (Jalan Besar GRC).

Both issues, mitigating the effects of climate change and strengthening Singapore's digital infrastructure, are important, he told the House during the debate on the Budget statement.

They not only affect Singapore's future, but also enable the country to take the global lead in these areas, said Professor Yaacob.

Former manpower minister Lim Swee Say (East Coast GRC) also praised Budget 2020 for sticking with a key tenet of earlier governments: To pursue economic growth not as an end in itself, but to build social cohesion and counter social divides.

"From 1G to 2G to 3G, we never forgot to channel the revenue generated from our competitive economy to take better care of our people," said Mr Lim.

"With this Unity Budget, our 4G is doing the same, and more. It will further strengthen our unity, cohesion and inclusiveness as One Singapore United."

The two former ministers also called on the 4G leadership to build on the trust between the people and the Government, and work to prevent social gaps from widening.

At the end of their speeches, fellow parliamentarians thumped their armrests in applause. Both men have been in Parliament for 24 years, and are likely to step down at the next general election.

For Singapore's digitalisation efforts to succeed, Prof Yaacob said the people must trust that the Government does not misuse their data. Even then, privacy concerns may still arise, he added. Likewise, complex and long-term issues such as climate change require public trust, as the Government has to spend huge sums over a long period to benefit future Singaporeans, he said.

Inevitably, the trust between the Government and the people will undergo stresses as the country grapples with these issues, he noted.

But, he added: "The trust we have built over the past 60 years or so has given us a quality of life that is the envy of other nations."

Mr Lim pointed out that some countries may pursue globalisation at the expense of widening social gaps, while others may turn inward, eventually becoming less competitive. Singapore wants the best of both worlds: A globally competitive economy and a locally cohesive society at the same time.

This requires Singapore to strive to be a pioneer and leader in frontier technology, and also ensure ample help for those at the bottom of society, he said, urging the 4G leaders to expand the Progressive Wage Model to more jobs and sectors.

Summing up his confidence in the 4G leaders, Prof Yaacob said: "I have full confidence in the ministerial team in not only dealing with this crisis, but also learning from it valuable lessons that will help us prepare for the next crisis."

A Budget for the times, but a glimpse into a possible future
Normalising flexi-work, reviewing extent of state support among points raised by MPs
By Grace Ho, The Straits Times, 27 Feb 2020

Every morning for the past few months, a middle-aged man who has lost his job dons office clothing and leaves his house. He does not return until evening.

What he has not told his wife is that he has no office to go to.

Workers' Party MP Sylvia Lim (Aljunied GRC) recounted this story of a resident she met, to illustrate the web of anxiety and shame that some workers in their 40s and 50s face as they grapple with layoffs and economic gloom.

They are a key focus of a blockbuster $106 billion Budget that has something for everyone; a Budget whose approach and coverage is hard to quarrel with.

With every tool at the Government's disposal jam-packed into Deputy Prime Minister Heng Swee Keat's speech last week - rebates, reliefs, grants, cash top-ups - MPs on both sides of the political aisle yesterday turned a clinical eye to technical gaps, debating the quantum of support, mechanics of implementation, and timing.

They paid particular attention to mature workers, who face a unique conflation of employment uncertainty and heavy family obligations.

On the timing, MPs Liang Eng Hwa (Holland-Bukit Timah GRC), Patrick Tay (West Coast GRC) and Seah Kian Peng (Marine Parade GRC) called for payouts under the Jobs Support Scheme - which aims to ensure workers stay employed by supporting companies in defraying their wage cost - to be brought forward from July.

Mr Liang flagged the danger that employers could still lay workers off in the months after, since the qualifying period is for salaries paid from last October to last December.

The SkillsFuture top-up scheduled for October could also be rolled out earlier so Singaporeans can make use of the downtime to train themselves, said Mr Tay.

On the amount, Ms Lim asked if there could be more liberal use of Central Provident Fund (CPF) savings for Singaporeans to chart their own reskilling.

"I know of some mid-career employees who had been laid off and turned to government agencies for assistance, but were unable to secure work for months," she explained.

She said that in addition to marshalling financial resources, people's anxieties and insecurities must be addressed to shore up the Budget's theme of unity this year.

On the implementation, suggestions included extending the use of $100 grocery vouchers to provision shops, and not just supermarkets, to give small businesses a much-needed boost.

Some, like Mr Melvin Yong (Tanjong Pagar GRC), called for the special SkillsFuture Credit top-up - an additional $500 for those aged 40 to 60 - to be extended to older cohorts.

"Just as we should support those who wish to continue working beyond 60, we should also support them in their pursuit of lifelong learning," he said.

Mr Desmond Choo (Tampines GRC) sought more help for the self-employed, who cannot rely on support channelled through employers, such as the Jobs Support and Wage Credit schemes.

He argued for greater union representation for them, and to classify them as workers defined by the Employment Act.

To more precisely match at-risk professionals, managers and executives (PMEs) with jobs and train them for the transition, labour MPs highlighted a new Job Security Council spearheaded by the National Trades Union Congress (NTUC).

The specifics will be pored over in the coming weeks as the House debates ministries' budgets.

But the Budget is a long-term plan, and yesterday's debate also threw up interesting points to consider for the future.

The first is normalising flexible working arrangements, to give comfort not just to working women but to caregivers of either gender who must balance careers with responsibilities at home.

As Mr Choo pointed out, the coronavirus outbreak and widespread practice of split operations clearly shows that organisations can practise flexi-work arrangements previously thought impossible.

The second point is reviewing fiscal tools and the extent of state support in the medium to long term.

Shrinking family sizes and the changing social compact are a ticking time bomb, with serious implications for intergenerational support.

While welcoming the effort to shore up seniors' retirement adequacy, such as through a new Matched Retirement Savings Scheme - where the Government matches CPF top-ups from family members - Mr Png Eng Huat (Hougang) said such schemes are still predicated on family members' support, an assumption that may not hold forever.

Finally, how to build trust and take the Singapore Together movement to new heights.

As Professor Yaacob Ibrahim (Jalan Besar GRC) said, referring to the recent rush to buy basic necessities after Singapore raised its Disease Outbreak Response System Condition level: "The fundamental question is whether we trust the Government in telling us what is the right thing to do, especially during a crisis."

The Singapore Together movement - which allows Singaporeans to co-create solutions to a wide range of issues in partnership with the Government - is a key part of building this trust.

Some asked if the process can be even more ground-up and organic.

Ms Denise Phua (Jalan Besar GRC) called for the deployment of more of the Government's best brains to the ground, and for agencies to cast a wider vision of their role, beyond their traditional scopes.

"The Ministry of Education should be envisioned as the Ministry of Lifelong Learning... The Ministry of Transport is no longer dealing with transportation but connectivity," she said, adding that trust is a two-way street.

"The people of Singapore (have) trusted the Government for so long; it is time for Government to trust the people too - not blindly, not indiscriminately, but in a less controlling and more facilitative manner."

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