May Day Rally 2022

Singaporeans must be prepared for more economic challenges in the year ahead, says PM Lee Hsien Loong

By Justin Ong, Political Correspondent, The Straits Times, 1 May 2022

Singaporeans must be prepared for more economic challenges in the year ahead even as the Government does all it can to cushion the impact of the Russia-Ukraine war, especially on the cost of living, said Prime Minister Lee Hsien Loong on Sunday (May 1).

"The fundamental solution... is to make ourselves more productive, to transform our businesses, to grow our economy, to uplift everyone," he noted. "Then our incomes can go up, and that can more than make up for higher prices of energy and food. Then we can all become better off in real terms."

PM Lee was addressing unionists at the May Day Rally at Downtown East, with some attending the hybrid event virtually.

In his speech, he outlined the Government's measures to alleviate cost-of-living pressures on Singaporeans. These include the $560 million Household Support Package announced at Budget 2022, which comprises U-Save and service and conservancy charges rebates and Community Development Council vouchers to reduce living expenses for nearly all households - with lower- and middle-income households receiving more.

The Monetary Authority of Singapore has also tightened monetary policy to reduce imported inflation, leading to the Singapore dollar appreciating.

Singapore is also taking steps to secure its own food and energy supplies, in the event of these being disrupted by the ongoing Russian invasion of Ukraine, which started on Feb 24.

"All this will help, but we must be prepared for more economic challenges in the year ahead," said PM Lee, pointing to inflation remaining high and central banks in developed countries tightening their monetary policies and raising interest rates.

"Global growth will be weaker, and there may be a recession within the next two years," he warned. "We have to face up to these realities."

Singapore, with its tight integration in the global economy and small size, will always be a price taker when it comes to world markets, said PM Lee. "We have very little bargaining power. If the prices go up, our prices go up. If supplies are short, we are squeezed. We cannot avoid these global headwinds."

Noting that Singapore imports nearly all its supplies of energy, he said that the doubling of oil prices in recent months has come at a cost - to households, businesses and the Government - of around $8 billion, as estimated by the Ministry of Trade and Industry.

He added: "There are limits to what Singapore can do to influence broader international trends. We will push back against deglobalisation. We will speak up to encourage the US and China to constructively engage each other.

"But ultimately, all these matters depend on the major powers themselves, and the relations between them, and how the war in Ukraine unfolds."

Said PM Lee: "We have speaking rights, but we are a small voice. Singapore has to take the world as it is, and develop a strategy that works for us in this troubled environment."

Turning inwards, relying heaving on domestic markets and producing more things onshore is a viable strategy for larger countries - but this is "not a choice open to Singapore", he said.

“Our strategy can only be one - and that is to stay open, to make our economy stronger, more resilient, and to keep on seizing opportunities for growth, developing new capabilities and becoming a more competitive economy,” said the Prime Minister.

"Because if we do that, then despite the uncertain climate, despite the pressures against globalisation, investors will still find it worthwhile to put their projects in Singapore, our exports will still find foreign markets, and we can still earn a living for ourselves in the world."

Progressive Wage Model: Entry-level waste collection workers salary to rise to $3,260 by 2028

Higher wages and clear career pathways for 3,000 waste management workers

By Sue-Ann Tan, Business Correspondent, The Straits Times, 24 Jan 2022

Come 2028, an entry-level waste management worker can expect his salary to double to $3,260, under a new Progressive Wage Model (PWM) for the sector that is set to start from July next year, the tripartite cluster for waste management announced on Monday (Jan 24).

Such a worker earns about $1,600 to $1,800 now, said Ms Melissa Tan, chairman of the Waste Management and Recycling Association of Singapore. She is part of the tripartite cluster, which comprises the National Trades Union Congress, employers and other stakeholders.

The salary increases will be implemented over a multi-year schedule from July 1 next year till June 30, 2029.

A total of 3,000 waste management workers here will see annual wage increments, mandatory annual bonus and a career and skills progression ladder.

The workers will also get a stipulated minimum hourly overtime pay.

From Jan 2024, they will also receive an annual bonus of at least a month's pay if they have been with their employer for at least a year. This bonus does not depend on their work performance.

These recommendations were accepted by the Ministry of Manpower on Monday.

The ministry said these improvements are consistent with the guidance by the Tripartite Workgroup on Lower-Wage Workers to ensure that such workers have meaningful and sustained wage growth to gain ground with the median worker.

Senior Minister of State for Manpower Zaqy Mohamad said: "You will see about 50 per cent wage increase growth in the coming years... I think this is a good outcome between unions and employers.

"But at the same time, we want to see the sector transform in a meaningful and sustainable way."

When asked if this move will raise costs for consumers, he said that not every change in business cost translates to higher prices for consumers.

He added that transitional support for companies will be announced during the upcoming Budget.

The PWM provides a clear career progression pathway for workers to improve their wages. To do so, they must undergo structured training to upgrade their skills.

The model currently covers the security, cleaning, landscaping, and escalator and lift maintenance industries.

Under the PWM for the waste management industry, workers will get a clear career progression pathway from crew to supervisor in the waste collection sub-sector, for instance, and from sorter to waste sorting plant supervisor in materials recovery.

There will also be a minimum number of Workforce Skills Qualifications modules that workers have to take at each level.

With upgraded skills, the PWM will ensure that workers see increased pay over six years, to 2029. For instance, a waste collection crew member earning $2,210 next year when the PWM kicks off, will earn $2,420 from July 1, 2024, and $3,260 in 2028. This marks a compound annual growth rate of 8.1 per cent.

By 2028, a waste collection senior driver will be earning $3,960 - from $2,910 next year - while a supervisor will be earning $3,910, from $2,860.

Mr Fahmi Aliman, chairman of the Tripartite Cluster for Waste Management, said the workers in the sector deserve due recognition for their hard work.

"The committee has been working hard for the past year to come up with a PWM that will boost the wages and skills, as well as improve career progression opportunities of our waste management workers, and in time, attract more workers to the industry," he added.

Ms Tan said the sector is facing a manpower crunch, especially amid the Covid-19 pandemic, as it relies heavily on foreign workers.

“Singaporeans are not coming forward to join this industry because it is not deemed to provide glamorous jobs,” she said.

Meanwhile, demand has risen for waste management services, especially with more packaging waste generated from e-commerce and food delivery.

“I hope that the PWM will attract more Singaporeans to come on board to carry out such jobs with pride,” she added.

Cleaners in Singapore to see wages increase over 6 years from 2023 under progressive wage model

Move set to benefit 40,000 workers across 1,500 cleaning businesses in Singapore

By Jolene Ang, The Straits Times, 8 Jun 2021

Cleaners will see their wages continue to go up each year from 2023, over six years, after proposals by a tripartite committee on the cleaning wage ladder were accepted by the Government yesterday.

From 2023 to 2028, the base wages of Singaporean and permanent resident cleaners across all job levels will increase each year. This will benefit about 40,000 cleaners across about 1,500 cleaning businesses in Singapore.

The first adjustment in 2023 will see base wages of general and indoor cleaners increase by, for example, almost 20 per cent from $1,312 next year to $1,570.

The move is meant to narrow the income disparity between cleaners and other workers. Under previous updates to the Progressive Wage Model (PWM) in 2016 and 2018, cleaners were slated to get 3 per cent annual wage increases from last year to next year.

The latest wage increases were among new recommendations made by the Tripartite Cluster for Cleaners (TCC), after it conducted another round of reviews of the model.

The PWM, a ladder that sets out minimum pay and training requirements for workers at different skill levels, was launched in the cleaning sector by the TCC in 2012. It has been a compulsory condition since 2014 for the licensing of cleaning companies.

The TCC - which comprises representatives from the labour movement, industry, service buyers and the Government - also recommended having cleaners trained in workplace safety and health protocols by the end of next year.

This is to ensure their personal safety when carrying out cleaning tasks, especially in the light of increased cleaning demands due to the Covid-19 pandemic.

Employers should also send cleaners for one of the core Workforce Skills Qualifications (WSQ) modules identified by the TCC for their relevant job levels.

The PWM training guidelines had earlier required that all resident cleaners attain the minimum two WSQ certificates next year.

With the latest recommendations, cleaners will have until December next year to complete the two modules.

Ms Phyllis Lim, deputy director of the National Trades Union Congress' (NTUC) U Care Centre, which supports low-wage workers, said in a press statement yesterday that training class sizes have been reduced to adhere to Covid-19 safe management measures.

"The new timeline is to allow sufficient time for cleaning businesses to comply with the training requirements... By the end of 2022, they should be able to send their cleaners (for the modules)."

Another recommendation was that beyond 2025, cleaners in lower job rungs must complete one additional module, while those in higher job rungs must complete two extra modules.

The list of WSQ training modules has been updated, and will periodically be updated to ensure its relevance, the TCC said.

The Ministry of Manpower, National Environment Agency, SkillsFuture Singapore and Workforce Singapore said in a joint statement yesterday that the recommendations will "ensure significant wage growth and skills upgrading for cleaners, and develop a more competent and productive cleaning workforce".

They said: "Together, our collective whole-of-society efforts will uplift our lower-wage workers."

NTUC secretary-general Ng Chee Meng said in a Facebook post: "I am glad that many of us are more aware of the value of work our cleaners do... Pandemic or not, uplifting the lives of our lower-wage workers matters to us."

GE2020: Tharman sets out plans for a more united Singapore

Social mobility remains the key, but Govt and community must take responsibility for all
By Lim Yan Liang, The Straits Times, 8 Jul 2020

Singapore can emerge from the COVID-19 crisis as a better and more inclusive society, which allows everyone to move up an escalator of rising skills and wages to better lives, said Senior Minister Tharman Shanmugaratnam.

To do so, the Government would have to play a key role, making deeper interventions earlier, to help level up children from less fortunate families from an earlier stage in their lives.

There would also be more help for workers to boost their productivity so that they continue to see their skills and wages move up over the years, said the Coordinating Minister for Social Policies.

While government policies are important, Singapore should retain a social ethos where people take pride in standing on their own feet, while also taking responsibility for one another, he said.

In a speech on strategies for an inclusive society and social mobility, live-streamed on the People's Action Party's Facebook page yesterday, he outlined Singapore's particular approach towards tackling inequality and ensuring security through every stage of life - from early childhood to working life to the retirement years.



"The aim of all our strategies, economic and social, is to have a more fair and just society, where young people have hope, regardless of what social backgrounds they come from... where everyone can advance in their careers regardless of what qualifications they start with, and where our seniors can look forward to living life fully in retirement, and living life with a sense of security," said Mr Tharman.

Stressing that the COVID-19 outbreak had made this a more important issue, since it was "fracturing societies", he said this goal could be achieved only through programmes that could be sustained across generations.

"This is about real programmes - real programmes that we keep improving, learning over time what works. Never perfect, but constant improvement."

Since social mobility is key to Singapore's fabric, and most inequalities kick in when children are very young, the Government is levelling the playing field with plans to double expenditure in the pre-school sector over the next few years, said Mr Tharman.

It is also preventing a digital divide by ensuring that every child, no matter how poor, has access to broadband Internet and a laptop or computer at home. "We are achieving real progress, but there's a lot more to do," he added.



For those in working life, Mr Tharman highlighted another Singaporean approach that has stood it in good stead: "a massive infusion of skills at every stage of one's career".

Singapore has also managed to keep unemployment numbers much lower than those in other developed countries even during the COVID-19 crisis. The wages of its average worker have risen by a third over the past decade. The wages of low-income workers have risen by even more.

"Fundamentally, because we have raised productivity," said Mr Tharman.

Finally, he touched on the issue of security for seniors.

Mr Tharman said that in every election, there will be politicians who make "very nice-sounding promises" on what should be done to help seniors, including for Central Provident Fund payouts to start earlier or for the Government to pay more of Singaporeans' healthcare costs, such as by subsidising MediShield premiums.

But many of these measures will only end up hurting the very people they are trying to help, he added, resulting in higher tax rates for middle-income households, because nothing comes for free.

"Some promises look appealing, but they actually lead to greater inequality over time," he said. "Think hard about the need for a fair system, a progressive system, and a sustainable system. And that's basically what we're trying to achieve in Singapore."



People have to play their part, too, he said. Singapore could emerge from the COVID-19 pandemic a more inclusive society if everyone finds a way to help others, whether they are the elderly, the less privileged or the less educated.

He urged the younger generation to be more involved in their neighbourhoods and in society, and take part in the Singapore Together movement, which Deputy Prime Minister Heng Swee Keat launched last year for citizens to actively help shape policies.

"For our younger generation, in particular, this is actually a challenge for a generation: building an inclusive society, that doesn't just mimic efforts in other societies, but does it our way - does it in a way that doesn't impose a heavy burden on Singaporeans at large," he said.

"It's not about the Government; it's about Singapore Together. Find your niche, find your passion, the areas you want to work in. And let's help spiral up our whole system, our whole society," he urged.

"It can be done. We can emerge from COVID not more divided, but with a more cohesive society."

Low-wage workers: Are Singaporeans prepared to pay more for domestic services so pay and work conditions for the low-income can improve?

Coronavirus: All hands on deck needed to improve low-wage workers' lot
By Joanna Seow, Assistant Business Editor, The Straits Times, 7 May 2020

The COVID-19 outbreak has shone the spotlight on the plight of low-wage workers in Singapore.

They clean our estates, offices and hawker centres, they build our homes and offices, and they check for vital signs and care for our sick and elderly, among other jobs.

Many are in roles critical to our lives, but they labour often unseen and unappreciated in regular times. It has taken a public health crisis to highlight again how the treatment of these workers - many of whom are older Singaporeans or lower-paid migrants - leaves much to be desired.

In the debate last month on the supplementary budget measures to help Singapore through the crisis, several MPs highlighted the struggles of workers in sectors such as healthcare and cleaning whose wages do not seem commensurate with the vital importance of their roles, especially during a virus outbreak.

Workers' Party (WP) chief Pritam Singh called for a thorough review of what a living wage in Singapore ought to be for Singaporeans "who man our critical infrastructure and keep the country's heart beating", just as food security and critical supply chains are being strengthened.

Yesterday, the Government, National Trades Union Congress (NTUC) and employer organisations issued a tripartite advisory with recommendations on measures that service buyers and providers should adopt to ensure the sustainability of the security sector in view of COVID-19.

These include paying security officers and firms fairly, and looking after officers' workplace safety and health, such as by providing personal protective equipment.

This is the second such advisory - the first, for the cleaning sector, was issued last month - and others will be announced progressively, said the Ministry of Manpower.

This is a welcome move in signalling to service buyers that the welfare of workers must be taken into account when they evaluate contracts.

With many aspects of work being relooked due to the crisis, now is a good time to examine what needs to change about how we support low-wage workers.



WAGES

Wages remain an issue for this group, especially during this crisis. With the circuit breaker measures shutting most workplaces to stem the spread of COVID-19, low-wage workers are in an even tougher position if they are put on no-pay leave or laid off.

To help low-income Singaporean employees during the economic uncertainty, those on Workfare will receive a Workfare Special Payment this year of $3,000 in cash.

This was among measures announced in this year's Budget and enhanced in the supplementary budgets, which also include the one-off $600 Solidarity Payment for all adult Singaporeans.

A questioning of inequities: The legacy of COVID-19

The pandemic is throwing up digital winners and losers, and intensifying US-China rivalry that will force regions like ASEAN to rethink their economic strategies. Within Singapore, there will be soul-searching over structures of inequities.
By Ho Kwon Ping, Published The Straits Times, 2 May 2020

"This too, shall pass" is the wistful refrain of many people in economies in lockdown across the world, as the coronavirus pandemic forces the closure of workplaces, schools and retail and entertainment places. Indeed, COVID-19 shall truly pass one day.

When the viral fog finally clears, the world will be a changed place. But, in what way?

It is self-comforting but probably self-deceiving to be naively hopeful that humanity will come together after such a cataclysmic event and create a better world, learning the bitter lessons from this pandemic. People are indeed coming together in moving displays of unity - such as for the pandemic's front-line responders - but these are usually spontaneous expressions of a common unity, and disappear once the tragedy is over.

Perhaps for climate change activists the pandemic has brought a brief respite: The global lockdown was a breather for Earth's skies and oceans to recuperate. However, it will be so brief as to seem like a passing rainbow in the overall thunderstorms of climate change.

If the world does indeed change for the better, it will probably be one step forward and half a step backward. In other words, the realistic idealist must also be a reluctant cynic. A cynical idealist's prognosis for the world, for Asia, and for Singapore might involve the following themes and trends.

VIRULENT US-CHINA RIVALRY

The US-China cold war becomes, literally, a more virulent COVID-19 war. At the start of their trade friction around 2018, already half of the US population saw China as a "major threat". With the coronavirus dubbed the "China virus" and responsible for more American deaths than any terrorist group, that "major threat" perception has now spread to more than two-thirds of all Americans.

Already China is everyone's favourite bogeyman: A whopping 91 per cent of all Americans see China as a threat of some kind. Even for the most liberal, anti-Trump, hope-of-the-future demographic - young people below 30 - 50 per cent have a similar threat assessment. It is not surprising that racist attacks against East Asians have increased dramatically, even in "liberal" places such as California and New York.

An increasingly fractured America will find common cause in its aggressive fearfulness of all things Chinese. This hateful blame mongering ensures that politics will infect what should be a more straightforward economic and health impact of a pandemic.

DE-GLOBALISATION SCOPE WIDENS

Post-COVID-19 governments and companies will diversify their supply chains further than during the US-China trade war, with health considerations now becoming a national security issue.

Singaporeans' concerns about foreign talent: Chan Chun Sing addresses fears about foreigners taking jobs from locals

He gives assurance that Govt 'is on the side of Singaporeans' and has their interests at heart
By Choo Yun Ting, The Straits Times, 7 Jan 2020

The purpose of bringing in the right number of foreign workers, with the right types of skills, is to benefit Singaporeans, Trade and Industry Minister Chan Chun Sing asserted in Parliament yesterday, addressing the hot-button issue of foreign talent.

Stressing that the Government put Singaporeans at the heart of its policies, he also sought to allay concerns about foreigners taking away better-paying jobs from locals, especially in the current climate of economic uncertainties.

In his detailed response to two MPs, he assured Singaporeans the Government understands their worries. "We will walk this journey together with you. This Government will always have your back," he said.

"The Government is on the side of Singaporeans. We will grow our economy and attract investments to create more good jobs for Singaporeans," he added, pledging to devote resources to enable Singaporeans to acquire the skills they need to stay competitive.



He went on to give an insight into the trade-offs involved as the Government attracts investments and seeks to create better-paying jobs for Singaporeans.

Some of these are in areas where there may not be enough Singaporeans with skills to match the jobs being created.

He asked if Singapore should reject investments that would bring in more foreigners, including some who would earn more than Singaporeans working in the same company. "Should we reject investments like Google, Grab and Facebook?" he asked.

Singapore cannot do this because such investments create higher-paying jobs for Singaporeans as well as for their children.

To drive home his point, he gave the illustration of a new investment creating two new jobs - one paying $7,000, and the other $10,000.



A Singaporean, who is earning $5,000 today, can get only the $7,000 job because he "does not yet have the skills or experience" for the $10,000 job.

While the Singaporean may feel he is being unequally treated, not accepting the investment will mean both the $7,000 and $10,000 jobs disappearing, he said.

He said while most Singaporeans accept this, what they want is a fair chance to get that higher-paying job, and what they oppose are practices that see them unfairly passed over. "The Government understands these concerns, and we stand together with fellow Singaporeans on this matter," he said.

That is why the Manpower Ministry is continually updating the Fair Consideration Framework to ensure a fair, level playing field for Singaporeans, he added.

The companies are also expected to train and groom Singaporeans. Most "play ball" because it makes business sense for them to localise, among other things, he said.

Mr Chan pointed out that local employment increased by nearly 60,000 between 2015 and 2018. The professionals, managers, executives and technicians' share of local employment during this period went up three points to 57 per cent, a proportion that is among the highest in the world, he added.

Real average monthly earnings for employed locals grew 3.2 per cent yearly during this period, higher than the 2.4 per cent per annum in the previous three years, he said. It was also higher than most advanced economies such as the United States (0.5 per cent), Japan (0.8 per cent) and Germany (1.2 per cent).

Singapore must strive for what he called the "Goldilocks balance" in hiring foreigners.

"We cannot open the floodgates and drown Singaporeans. But neither can we close our borders and reject foreigners in our workforce.

"Above all, we must firmly reject efforts to stoke anti-foreigner sentiments by spreading falsehoods or creating invidious comparisons out of context. That is not the kind of politics we want," said Mr Chan.

Tuas Port to be world's largest fully automated terminal when completed in 2040

Mega port will be twice the size of Ang Mo Kio and create new jobs for workers
By Fabian Koh, The Straits Times, 4 Oct 2019

The new Tuas Port will use automated technology to carry out its key operations, as Singapore sets out to reinvigorate and re-imagine the maritime industry which employs 170,000 people here.

When fully completed in 2040, the mega port will be the world's largest fully automated terminal.

It will be twice the size of Ang Mo Kio, and boast features such as automated wharf and yard functions and full-electric automated guided vehicles, Prime Minister Lee Hsien Loong said yesterday at the ground-breaking of port operator PSA's new terminal.

Located in the south-western corner of Singapore, the port will vastly ramp up Singapore's cargo capacity and create new and different jobs in spite of the automation.

Tuas Port will also be able to cater to the demands of the world's largest container ships, with 26km of deep-water berths.

Besides just handling containers, the port will have space set aside for companies to be located, a move that could improve the links between port and businesses.

"It also gives us more room to create customised logistical arrangements, for example, inter-modal sea-air cargo to take advantage of our air hub as well," said PM Lee.

The new port is crucial as the maritime industry contributes about 7 per cent of Singapore's gross domestic product.

The contribution could scale up as the new port will be able to handle 65 million twenty-foot equivalent units (TEUs) annually - almost double of last year's 36 million TEUs.

TEU is the unit of measurement for cargo capacity.



PM Lee said the move to Tuas goes beyond just having a larger terminal.

"Tuas Port is also an opportunity to peer over the horizon and rethink the future of shipping. Because the port will be on a completely greenfield site, we can design from a clean slate and make innovation and sustainability key features."

He emphasised that PSA makes "a much wider contribution to the economy than most other companies". At the same time, it needs to draw the best minds to maintain its dynamism and to match its competitors, which are also investing in automation and expanding rapidly, he added.



The mega port is being developed in four phases, with construction work on the second phase having begun in July this year. The whole project will cost over $20 billion.

Its first berths are scheduled to start operating in 2021. PSA's three city terminals at Tanjong Pagar, Keppel and Brani will move by 2027. By 2040, Pasir Panjang Terminals will be consolidated at the mega port too.

With the port's capacity almost doubling, more jobs are likely to be created despite the automation.

National Wages Council 2019/2020 Guidelines

NWC recommends structured training to spur productivity; suggests S$50-S$70 pay hike, one-off payment for low-wage workers
Wages council says productivity gains needed for wage hikes, seeks more pay for low earners
By Aw Cheng Wei, The Straits Times, 31 May 2019

With uncertainty rising in 2019, the National Wages Council has urged all employers to offer their staff structured training.

This, in turn, would spur productivity growth to support and sustain wage hikes, it said yesterday.

While asking employers which have done well and have good business prospects to offer salary hikes and bonuses, the council said it expects all companies that improved their productivity last year to give their workers a one-off payment.

On top of this, it urged companies to raise the monthly salaries of low-wage workers by between $50 and $70.

The threshold has been raised this year to those earning a basic wage of up to $1,400 a month - up from last year, when only those earning up to $1,300 a month were included. The move is expected to benefit 22,000 more workers.

In all, about 154,000 full-time resident workers will come under the new basic wage threshold.

The Government, Singapore's biggest employer, said that it accepts the council's recommendations.

The council took into account economic growth prospects, productivity and workforce training trends in making its recommendations.

It noted that in 2018, wages had grown faster than the productivity growth of 2.4 per cent. It also pointed out that the proportion of employees receiving structured training - including classroom training and workshops - had not improved over the past decade.

"Wage growth must be supported by productivity growth," said the council.

It added: "All employers should develop a training plan that meets their current and future requirements."

Asking companies to work towards better wages and skills, it said jobs could be redesigned and workers trained for them. It also asked them to tap government schemes such as the Enterprise Development Grant.



The council noted that the growth outlook for this year is dimmer than last year's, and asked companies to reward employees based on their performance and business prospects.

Those that have done well but face uncertain prospects "may exercise moderation" in built-in wage increases, but should still reward staff with variable payments, it added. Those that did not do well and also faced uncertain prospects could exercise wage restraint, with management leading by example.

DPM Heng Swee Keat at the 49th St Gallen Symposium

Dialogue key to fostering trust between Government and people: Deputy Prime Minister Heng Swee Keat
By Linette Lai, Political Correspondent In St Gallen (Switzerland), The Straits Times, 10 May 2019

For Singapore, the key to fostering trust between the Government and the people lies in dialogue, partnership and always keeping the promises it has made to the citizens, said Deputy Prime Minister Heng Swee Keat yesterday.

This is a legacy, he added, handed down from founding prime minister Lee Kuan Yew, who had said the Government must never, in an election, pledge what it cannot deliver.

"Credibility is important. What we promise, we must do our very best to deliver," said Mr Heng, who had been the late Mr Lee's principal private secretary.

The DPM, whose appointment to the No. 2 position this month signals his standing as the next prime minister, was responding to a question at the 49th St Gallen Symposium in Switzerland on how the Singapore Government builds trust with its citizens when in other countries, this trust has broken down.

One key element is dialogue and interaction with the people by MPs at weekly Meet-the-People Sessions, and via platforms like Our Singapore Conversation, said Mr Heng, who is also Finance Minister.

He hoped the next round of the conversation will focus on imbuing in people a take-charge attitude when they see a problem that needs fixing. This, in turn, will require leaders at all levels of Singapore society, he added.



Building trust also involves working in partnership, like what is being done in Singapore's tripartite system, the DPM said.

For instance, when the Government was working on restructuring the economy, it gathered together business leaders, business chambers, large trade associations and unions to talk about what should or can be done, he said.

Trust is also about honesty, even when undertaking difficult decisions, like raising the goods and services tax from 7 per cent to 9 per cent. This is to take place some time between 2021 and 2025.

"Some people said, 'You are mad to announce a tax increase so far ahead'. I said our projection is that we have an ageing population; if we want to keep our healthcare system sustainable, we each have to do more to take care of our seniors."

He added: "We believe it is better to be honest with our citizens than to say we have solved the problem."



Mr Heng was speaking at a public dialogue with the symposium's chairman Dominic Barton, a former managing director of consulting firm McKinsey.

He attended the symposium as part of a five-day study trip to Switzerland, where he visited Swiss companies and research institutes to learn more about productivity, R&D and industry development efforts there.

Budget 2019 Foreign worker quota cuts: Will they finally nudge services?

Getting manpower-lean
Results from previous moves to reduce the sector's dependence on foreign manpower have been sluggish. Insight looks at what might be in store with the latest efforts
By Joanna Seow, Manpower Correspondent and Sue-Ann Tan, The Sunday Times, 24 Feb 2019

Six years since the foreign manpower tap was last tightened in the service sector, businesses are being told they need to do more.

While some have heeded the call to become more productive, others have lagged behind, leading Finance Minister Heng Swee Keat to say in his Budget speech that growth in the number of foreign service staff may be on an "unsustainable path".

"Our (local) workforce growth is tapering, and if we do not use this narrow window to double down on restructuring, our companies will find it even harder in the future," he said last Monday.

Thus the service sector Dependency Ratio Ceiling (DRC) - the proportion of foreigners on work permits or S Passes a firm can employ - is being cut from 40 per cent to 38 per cent and then 35 per cent over two years.

The sub-quota for S Pass workers - mid-skilled foreigners paid at least $2,300 a month - will also drop from 15 per cent to 13 per cent and then to 10 per cent.



What does this mean for companies? Now, if a firm needs 20 staff to operate, it can hire 12 locals and eight foreign workers.

Come Jan 1, 2021, if it needs 20 staff to operate, it will need to hire another local worker to replace one foreigner. Or if it manages to operate more efficiently, it can retain the 12 local staff and employ only six foreign workers.

What is holding the sector back?

Insight looks at the challenges businesses are facing and how the quota cuts are likely to play out.

WHERE THE WORKERS ARE

The service sector has been employing more and more workers over the years, even as manufacturing and construction cut back.

In particular, growth in the number of S Pass and work permit holders in services has been picking up pace. It rose by about 3 per cent a year, or 34,000, in the past three years, Mr Heng said.



A spokesman for the Ministry of Manpower (MOM) said the increase was broad-based across services, but the segments that will be hit hardest by the quota cuts will be accommodation, food services, real estate services, transportation and storage, and arts, entertainment and recreation.

Mr Heng also noted that the increase in the number of S Pass holders in services last year was the highest in five years.

These are workers who have at least a diploma or a degree qualification, and many work in frontline service jobs like customer service, food and beverage (F&B) management and nursing, recruiters tell Insight.

Minimum wage vs Progressive Wage Model: Debate over best way to lift pay of low-wage workers

Some have called for a minimum wage, but the Government has said its Progressive Wage Model works better
By Yasmine Yahya, Senior Political Correspondent, The Straits Times, 30 Oct 2018

At the weekend, a debate on the minimum wage erupted in the comments section of Ambassador-at-large Tommy Koh's Facebook page as netizens - including former labour chief Lim Boon Heng - weighed in on how Singapore should lift the incomes of its low-wage workers.

This happened after a forum organised by the Institute of Policy Studies last Friday, at which Manpower Minister Josephine Teo defended the Government's position for not setting a minimum wage in Singapore.

Both sides stand firmly by their arguments on the benefits and shortcomings of adopting a minimum wage. The emotive topic has also divided opinion.

The Straits Times takes a deeper look at what proponents on both sides say.

WHY THE CALL FOR A MINIMUM WAGE?

The calls for Singapore to implement a minimum wage have resounded for many years, with those in favour of this approach arguing that it would ensure every worker earns enough to live in dignity and material sufficiency.

To bolster their argument, they point out that many advanced economies such as Japan, South Korea, Taiwan and Hong Kong have implemented a universal minimum wage.

And these economies have done so without compromising their employment rates, foreign investment levels or competitiveness, they say.



In a commentary he wrote for The Straits Times in 2010, Professor Tommy Koh said: "(Singaporeans) also believe that hard-working Singaporeans, no matter how humble his or her job, should earn incomes that would enable them and their families to live in dignity and material sufficiency. This is, unfortunately, not universally the case in Singapore."

The market does not work for low-skilled and semi-skilled workers because they do not have equal bargaining power and are competing against an endless supply of cheap labour in the region, he said.



Prof Koh commented on having a minimum wage at the IPS forum last Friday, and again on Facebook on Sunday, when he outlined five arguments in support of the policy:

First, every working Singaporean should earn a living wage.

Second, many low-wage workers here are not paid a living wage.

Third, when the market fails, the state must intervene in order to ensure a just outcome.

Fourth, the low salaries paid to Singapore's low-wage workers are not due to their low productivity, but because Singapore has brought in about a million lowly paid foreign workers to compete with local workers.

Fifth, the Progressive Wage Model - a system introduced by the Government to lift wages for workers in certain sectors - has not raised the wages to a level which enable Singapore's low-wage workers to live in dignity.