A WORD FROM THE MP
March 2010

Budget Speech on Productivity, Aged, Disabled and Babies

INTRODUCTION

Budget 2010 is a budget of vision and courage. I commend the ESC and Minister for calling a spade a spade and admit openly that our productivity in service, manufacturing and construction is 38% to 66% per cent lower than the best in the world. And that something has to be done.  Singapore is not at the bottom of the pile but for a small country with a relatively small workforce, it is critical to proactively address the issues. 
I have several observations and suggestions for the Minister's consideration.

OBSERVATION 1: VISION OF ECONOMIC STRATEGIES COMMITTEE (ESC)

The vision of the ESC forms the bedrock of this year's Budget. But the vision of Singapore as a country must be more than that of an economic committee of highly intellectual and qualified professionals. We are a country populated by people of mixed abilities, ages and needs. To embrace and be inspired by the vision, we must try to engage as many Singaporeans as possible for the vision to be a shared one. 

Since a young age, I have been told that Singapore should be like Switzerland or a global city like London or Paris. As someone who chooses to make Singapore my home and workplace, I for one do not want Singapore to become a copy of these western and benchmarked cities. 1 month ago, a few of us in the House had a discussion with 2 successful doctors. Both were educated and lived overseas but  both chose to return to Singapore to work and live. In their minds, Singapore’s uniqueness  is in the ‘fusion of east and west’; our multi-racial and multi-cultural profile ; great food; great schools and discipline and a great place to raise their children.

Add to that, our uniquely Singapore HDB flats; our fantastic festive light ups at Chinatown, Little India, Geylang Serai, Kampong Glam; our noble though less-than-perfect way to include those who are at risk of being left behind; and now a good philanthropy launch pad to serve the needy in Asia. Singapore has a distinctive culture and features of a brand that is appealing.  Let us not keep trying to make ourselves the Switzerland, London or Paris of the East.

Let us engage more Singaporeans to share a vision beyond economics and get the buy-in from all, if not most, Singaporeans . Let us tell our story better to attract both investments and potential citizens to our very own unique Singapore.   

OBSERVATION 2: PRODUCTIVITY AND INNOVATION – MONEY ALONE IS NOT ENOUGH

Making Productivity and Innovation second nature in companies and individuals in every sector, cannot happen with money alone. As the Chinese saying goes, you can bring the horse to the water but you cannot force it to drink.

After the budget announcement last week, I garnered the views of SME owners in the textile, food and beverage, carpentry, food wholesale and retailing and construction industries. A couple of them are winners of past years’ SME award winners. I asked them how they may be able to leverage on the new Productivity and Innovation Fund and initiatives. Their muted responses are indicative of many who are at a loss of where to start and do not have the in-house capability to make this relevant. A  popular SME website wryly commented on its landing page that  “most SME owners are too preoccupied with their daily operations to think of anything else.”

Singapore SMEs are awashed with award schemes such as the Singapore Innovation Class; Singapore Quality Class; People Developer; Singapore Service Class.  Different help portals also offer free information such as the SME Tool Kits and grants schemes. 

As early as 2007, Singapore-based SMEs themselves identified leadership training, team building, marketing and promotion, and business planning as key need areas. To equip SMEs with talented managers, SPRING invested S$60 million in a Business Leaders Initiative (BLI) to create a pipeline of 1,000 trained SME bosses, senior executives, and aspiring executives. Similarly, to encourage innovation and adoption of new technology, SPRING launched in August 2006, a $150m Technology Innovation Programme (TIP) to co-fund innovation projects by SMEs and even to strengthen what are called Centres of Innovation (COIs).

Singapore has been generous with supporting the SMEs through programmes. However, even PM has recently acknowledged that most SMEs are still not operating at high levels of productivity, innovation or margin. 

As the gurus would say, insanity is doing the same thing over and expecting different results. What happened? Why were the outcomes less than ideal? What were the gaps and the root causes? What are the lessons we can learn and apply from countries who are ahead of us? How, for instance, did Hong Kong, a country whose service quality was famously low 2 decades ago, steered the way to its current excellent service level? How did Japan stay ahead of the pack for so long in the Construction sector? These questions must form part of the new National Productivity and Continuing Education Council led by DPM Teo.

In fact, it will be good to know specifically what the new National Productivity Council will do differently from what SPRING and others have done? Will it simply be old wine in new wine skin? I was told that old wine when stored in new wine skin will lead to the bottle cracking and the wine spilling.

Unless the productivity tools are learnt and applied by all levels in all sectors including the public sector and Council members, it is unlikely to form part of our country’s DNA. It may fade away once the monetary incentive or pressure is lifted. 

OBSERVATION 3: FOREIGN WORKER LEVIES

I am glad that the pace and quantum of the much-worried-about Foreign Worker Levy is calibrated and well paced. I want to add to the chorus of pleas for sectors which genuinely require foreign labour for work that cannot be substituted by technology. I am specifically referring to jobs that are shunned by locals in especially the nursing homes and day activity centres for especially the moderate to severely disabled like the MINDS homes and some autism adult centres.

1.     A doctor who volunteers at a nursing home shared a real-life story of more than 10 government-sponsored trainees on a professional conversion training scheme. As the training progresses over the weeks, almost 90% of these trainees dropped out from the training, leaving only one who finally worked at the nursing home. The daily tasks of having to carry, wash, feed and diaper-change adult disabled patients - essentially basic care for the chronic sick – are tasks that most will not find appealing;

2.     At another nursing home, management staff are highly anxious over the impact of the new tier system and levy increase on the home’s operational cost. This home is currently operating with almost 60% foreign staff;

3.     In the special-needs community where I serve, many day activity centres and residential homes serving moderate to severely disabled adults are also worried over the cost impact of this new direction. Some of these homes provide care giving to physically big adults who at times are difficult to handle.

Anyone who insists that the concerns of these centres and homes can be addressed if only they are more productive and innovative, should spend one week working there on the ground.

Hence, although I am deeply grateful that Minister has retained the generous income tax reliefs for donations to charity and made tax concessions for dependents who are disabled; I seek Minister’s attention to reassure this bigger concern in the chronic sick and disability sector. 

For this category of employers , I would urge the Minister of Finance to consider exempting non-profit organizations from the limit quotas and increases in levy.

OBSERVATION 4 : OTHER PERTINENT ISSUES

I urge the Minister not to forget the other pertinent issues that Singapore is facing. Just as Productivity was sidelined in past years, please let’s  keep on our Agenda some key concerns we have identified in the past. These include :

1.     Rapidly aging population – Minister Lim Boon Heng has done a commendable job on the Council for 3rd Age and the wellness movement with the establishment of wellness centres for the elderly all over Singapore. But what about those who are in the so-called 4th Age who are beyond the active aging range and who may be immobile and disabled? Should there be funds directed to form a Council for 4th Age. Beyond tax relief, there is a need to direct resources to develop the master plan for the mapping of services for this group;

2.     Mental Health –  we need to address the worrisome trend that there is a growing population including the young in schools afflicted with depression; inability to stress-manage or cope with the expectations and pressures of our highly urbanized society;

3.     Fertility – I am surprised that nothing is mentioned in this year’s Budget. Has the Minister given up hope of saving the endangered species of the Singapore Baby especially the Tiger Baby? And what happens if one decides to heed the Government’s call and the child turns out to be less than perfect? The sad thing is that those born with congenital illnesses are not even covered under the CPF-administered basic MediShield health insurance because they are considered burdens who would raise the premium rates for the rest of Singapore. If we wish to encourage couples to have babies and we cannot guarantee their conditions, we must not deny children who turn out less-than-perfect the rights to basic health coverage in the name of economics;

4.  Financial Literacy and Planning -  we need to continue to eyeball the findings that most Singaporeans are financially illiterate and are neither keen nor equipped to plan for their retirement. We need, as part of our vision, to take specific care of the young and elderly disabled and especially those from the lower income strata. MCYS and NCSS have done a good job in trying to serve this group with the setting up of the Special Needs Trust. But there are families who cannot afford even the initial premium and who nonetheless need the service. I urge the Minister to use a scalpel and not a parang when considering top ups for those who need a leg up in Singapore; and to not forget the disabled in the lower income category in Government’s annual giving.

OBSERVATION 5: COMMUNICATION

Many Singaporeans are either not engaged or unaware of how this Budget may be relevant to them. There is definitely a need to communicate the key thrusts more effectively so that the average Singaporean can easily understand, appreciate the ‘whys’, ‘whats’ and ‘hows’ of this significant Budget.

Denise Phua Lay Peng
Advisor to Jalan Besar GRC (Kampong Glam) Grassroots Organisations
Member of Parliament, Singapore