Hansard, 2000-03-11

asked the Minister for the Environment what effort is being made to control the population of crows and how successful it has been.

Mr Speaker, Sir, in recent years, we have noted an increase in the crow population in spite of stepped up efforts by PPD to cull them and by ENV to deny them waste food. The growth of the crow population is due to the crow's successful adaptation to the urban environment where there is ample food and inadequate culling. The number of crows culled by PPD has increased from a monthly average of about 1,000 in 1998 to 1,500 last year, 1999. To maintain continuous pressure on the crow population, PPD, with the help of the Singapore Gun Club and the SAFRA Shooting Club, will continue to carry out crow shooting at roosting sites where large numbers gather to sleep overnight on the trees. ENV has required all foodshops to use a standard refuse bin with lid and to make sure that there is no food waste left exposed. We have also been working closely with the Town Councils to improve on their housekeeping, especially the cleanliness of their bin centres. The bin centres also have been protected against crows with wire meshing to all openings. We have also sent out circulars to all operators of restaurants, coffee shops and hawker stalls to warn them against feeding crows. PPD and ENV are continually reviewing the methods of crow control. A new method being introduced is the use of specially designed crow traps. These traps will contribute towards greater culling of the crows. An ornithologist has also been commissioned to make a study on the behaviour and biology of crows so that other control methods can be developed. Sir, in the meantime, PPD will further intensify the culling of crows by shooting and ENV will strictly enforce the regulations on waste management and removal to deny the crows food to further contain the problem.

Mr Speaker, Sir, I would like to ask the Senior Minister of State what he is crowing about. What crow friendly measures is the Ministry undertaking other than shooting these crows and culling them with shotguns? It also creates problems for the residents if the guns misfire in the area which may endanger their lives. This is a serious matter.

Sir, besides culling and removing sources of waste food to reduce the crow population, we can also look into new ideas that may help. For instance, one idea that crops up is to have bins and plastic bags used for containing refuse infused with a repellant so that crows will not go near them. I will give an example of how we control the dengue now with the help of my Ministry and the university. For example, in the case of dengue control, scientists in my Ministry have discovered that by raising the temperature of stagnant water to 45o C, it can kill the larvae in the water within one hour. With this finding, they have developed a heating element that can be installed in roof gutters. By switching on the heating element for slightly more than one hour, and this can be done by a timer switch in the middle of the night, any larvae breeding in the gutter will be destroyed. I hope the same effect will be done towards this. We are working towards this. This is a case where many people, out of kindness, just give food to the crows. There is one instance where a hawker purposely gives the crows something to eat every day. He said otherwise the crows will be a nuisance. And one of those days, he even pat the head of that chap. This feeling of kindness, as far as Asian people are concerned, is understandable. That is why we try to look into this particular area with new ideas and hopefully a breakthrough.

I would like to ask whether the PPD has ever offered a bounty on crows and leave it to the creativity of the community to think out new ways to trap them.

The bounty hunters are from the two clubs, Singapore Gun Club and SAFRA Shooting Club, and they are doing it on a voluntary basis. Other than that, the traps seem to be working. We have given out to Town Councils about 22 traps that have managed to trap about 10 birds a month. We hope to give another 30 to the town councils and I hope the town councils will be ever ready to accept them.

Mr Speaker, Sir, I want to ask the Minister of State what is the connection between crows and dengue. Second, does the crow cause dengue which is the issue at hand? The measure proposed is not effective in a sense. Firing a few shots may not deal with the problem. Are there any ecological or eco-friendly measures that the Ministry is considering, other than the measures that he has suggested because the crow problem has not been resolved? There have been a lot of complaints from different quarters.

I share the concern. But, somehow, we do not have any species, like eagles or vultures, that can take care of the crows. In Malaysia or Indonesia, they have musang (fox) that can really mash their nests. In our case, it is just ourselves. As for connection between crows and dengue, I just mentioned that we are seriously looking into this method. Dengue is one case. Some were fatal. To me, one death is one death too many. And we have managed to come out with this heating element measure. This is just an example. We hope the so-called repellant effect at the bin, or in the plastic bags especially, can do the work. If you consider that as a friendly way of dealing with the crows, that is our friendly way of using it.

Can I ask the Senior Minister of State whether, when he is crowing about shooting crows, he can also go after the pigeons because I understand the pigeon droppings are more dangerous than the crow?

We will certainly look into the matter also.

Sir, from the number of crows that we are seeing, and it is increasing with each passing year, I wonder if the Ministry could set a benchmark figure and give a definite timetable as to how they are going to control the growth of the crow population. Could the Senior Minister of State give an indication of the plans?

Sir, there are about 6,000 crows in Singapore. It is something to crow about. If they were to mate, usually they produce between two to four chicks. Out of four, half will somehow survive, that is, 6,000 plus the present 6,000, which is 12,000. It is quite large. We have managed to handle only about 1,000-1,500 a month. We will certainly intensify our efforts whether by culling, looking after the waste, giving some public education to our people, or providing traps. We hope that the latest one will work.

Mr Speaker, Sir, unlike my colleague, Dr Vasoo, I still cannot see the connection between dengue fever and the crows. Is the Senior Minister of State trying to suggest, in fact, crows with the dengue fever? Then he mentioned about housekeeping by town councils. I am sure, as the Chairman of a town council, we want to cooperate with the Ministry of the Environment. But one should not pass the buck to the town councils because the crows fly everywhere. The individual town council cannot control them because they fly from one town council to the other. I think it is more a matter of the Ministry of the Environment taking a concerted action to deal with this problem at source.

Sir, I thought we are taking a concerted effort with all the measures taken. There is no intention at all to pass the buck. To me, it is a matter of asking cooperation, rather than you and me with a gulf in between. As for the findings on dengue, when we cooperate with certain authorities, like the universities, we are very serious about it. We have managed to get a cure for dengue fever by destroying the larvae in the gutters. You do not have to tear down the roof. We have managed to do that and the findings may be there. Hopefully, with these new measures or new breakthroughs, we can do the same, like the findings, where we heat the roof gutters. Is that a wrong comparison?

Dr Teo, last question. We have to move on otherwise the Committee of Supply cannot start.

May I ask the Senior Minister of State how does the crow trap work? I understand the crows are quite intelligent. If you have 6,000 crows, the town councils will spend a lot of time and effort trying to catch the crows.

I can supply you the cage. It is a very simple one where you can put the bait inside, and the crows will come in. The moment they come into the box, they cannot come out because they are so large. Remember the monkeys, when they take something, they will refuse to let go their hands with the food. So they were caught by the Africans. I will let the Member have the opportunity to use it if he wants to.

asked the Minister for Manpower what steps are being taken to monitor the living conditions of foreign workers and what are the penalties for inhumane treatment of foreign workers.

Mr Speaker, Sir, I do not have much to crow about as far as foreign workers are concerned. But when applying for foreign workers, all employers have to undertake to provide adequate accommodation for their foreign workers. In the case of foreign domestic workers, they live in the homes of the employers. Although there are no specified standards for the accommodation of foreign domestic workers, my Ministry has issued guidelines to employers to ensure that foreign domestic workers' need for privacy should be respected. Employers have also been reminded not to make their foreign domestic workers sleep on beds in the corridors or in the living rooms or in the kitchens with little privacy. Foreign domestic workers should not be asked to share a room with an adult of the opposite sex. The living conditions of foreign workers in the economic sectors vary from industry to industry. In the manufacturing and marine sectors, foreign workers are generally provided with reasonable and acceptable accommodation. In many cases, foreign workers are housed in purpose-built dormitories, whose living conditions are comparable to that enjoyed by the average Singaporean. Shipyards, for example, provide very good accommodation to their foreign workers such as the Acadia Lodge by Keppel Shipyard. Sembawang Shipyard also provides good quality accommodation in company-built dormitories. Other foreign workers in the manufacturing sector are housed in commercially run dormitories built by the Jurong Town Corporation. In the construction sector, the majority of the foreign workers, ie, 80%, are housed on-site. Contractors who provide on-site housing have to meet basic standards set by various Government agencies, such as the URA, BCA, the Ministry of the Environment and the Fire Safety Bureau. The remaining 20% of foreign construction workers are housed off-site. Some are accommodated in purpose-built dormitories, such as the Kaki Bukit Hostel which provides not only good quality housing, but also social recreational amenities to the 3,000 residents. Other foreign workers are housed in pre-war shophouses, old buildings or in private residential estates. This is where the problem lies. Some unscrupulous employers may force their foreign workers to live in cramped, and sometimes, unsafe living conditions. Those responsible will be taken to task for violating the guidelines on accommodation set by the Work Permit Department and various Government agencies. The URA, for example, ensures that there is no misuse of private and residential buildings. On the inhumane treatment of foreign workers, the Government takes a very serious view of employers who mistreat or abuse their foreign workers. The Penal Code, for example, was amended in May 1998 to enhance penalties for employers who physically abuse their foreign domestic workers. Errant employers will not only be taken to court for their actions, they will also be debarred from employing foreign domestic workers. Foreign workers in the economic sectors are protected under the Employment Act which spells out the basic terms and conditions of employment. Employers who fail to provide basic statutory benefits and who do not comply with the provisions of the Act will be dealt with under the law. In addition, these employers may be barred from employing foreign workers. Employers are reminded to treat their foreign workers decently and not to subject them to any inhumane actions, whether in the homes or other workplaces. Those who do so will have to face the consequences of the law.

I would like to ask the Minister whether designated sites to house foreign workers in the economic sectors, like the construction industry, are subject to licensing and how often are they inspected on-the-spot basis?

When a contractor wants to build dormitories to house foreign workers, they have to apply for the land and the land would be made available, subject to various conditions from the Land Office. Obviously, the contractor or developer who puts up the dormitory housing will have to comply with the various building control regulations and this will obviously also be inspected from time to time.

Order read for consideration in Committee of Supply [4th Allotted Day].

Head W (cont.) - Resumption of Debate on Question [10th March, 2000], "That the total sum to be allocated for Head W of the Main Estimates be reduced by $100." - [Mr Leong Horn Kee] Question again proposed.

Mr Chiam is not here. Mr Thomas.

Sir, in 1993, as the Vice President of the Consumers Association of Singapore, I appeared before a parliamentary Select Committee on the Goods and Services Tax (GST). CASE had, at that time, just submitted a paper on their views on the GST, and during the hearing, we asked for the extension of coverage of existing consumer protection legislation as the existing legislation was inadequate. Now, in year 2000, at the beginning of this new millennium, I can say the same thing. We had, back in 1993 asked for the introduction of a Fair Trading Act. The arguments for it are still the same. A Fair Trading Act would make the marketplace competition equitable to all the retailers, as well as the consumers. It would be an extension of our laws that we have to protect the environment, health and safety, and now to protect consumers. This will be a further improvement on the quality of life for our citizens. From what I hear in CASE and my colleagues from CASE, some of the problems that consumers face today can be quite easily eradicated if there was a Fair Trading Act. These include things like the misleading and non-substantiated claims, deceptive labelling, door-to-door sales and hard sell, the bait and switch method of sale, just to name a few. With globalisation, the power of big business will increase. It therefore will become more and more urgent to have rules to ensure fairness, equity and a more level playing field in the marketplace. A Fair Trading Act will hurt no one, except the unscrupulous trader. It will help legitimate business. It will lift the floor of minimum standards and ensure a level playing field for all the players. It will help the retail industry, as locals and tourists will have more confidence in shopping without being taken for a ride. I hope that we, Singaporeans, do not have to wait very much longer to enjoy the advantages of a Fair Trading Act.

Sir, massive crowds gather to hear how to make money quick from a "dot.com" business. Even more massive crowds shove and push to get forms for the public listing of a "dot.com" company. Sir, there is a fever out there. Nay, not a fever, but a mania. There is a frenzy when people rush to grab these opportunities so they think to get rich quick and painlessly. In one month, a dream merchant demonstrates that he can collect S$6 million. No, better still, an assetless company can raise US$12 billion in cash on the basis of that mania. This is a new economic doctrine called "hasti-Li Ka-shing in". I want to urge the Government to do four things to protect consumers from being dot-conned: (1) Amend our pyramid selling laws to ensure that those who build pyramids on the Net do not get away with $5,000 slaps on the wrist. There must be real products and services before a network marketing merchant is legalised. A business which offers partners, franchisees or customers (however they are called) more money from merely recruiting new members rather than selling a service or product must be clearly identified as a pyramid seller. (2) Create a separate bourse for dot.coms. My colleagues in the House have proposed this earlier and I support the proposal for the reasons they have given. (3) Introduce consumer protection provisions, such as a Fair Trading Act, to criminalise businesses which conclude contracts, whether of sale or investment, on (a) promises which they do not intend to keep or do not believe they can keep; (b) over-exaggerate the potential of the businesses or products without full disclosure of relevant risks and shortcomings; and (c) to make misrepresentations of opinion or future projections and it is irrelevant whether these misrepresentations are made directly or indirectly, by allusion or deceptive juxtaposition of unconnected facts and figures or implied from subsequent conduct. All the unconscionable and unethical conduct I have described currently is not proscribed by our consumer protection laws. (4) To promote self-regulation by industry and fund organisations such as the Consumers Association of Singapore to educate and create consumer awareness and to monitor the industry codes of practice.

Sir, I would like to urge the Minister for Trade and Industry to look into the issue of "third line forcing" as an unfair trading practice in Singapore. In "third line forcing", the supplier's goods or services will not provide the goods or services unless the customer agrees to purchase from a third party chosen by the supplier. The supplier is thereby "forcing" the customer to purchase from a third party as a pre-condition to supplying the goods and services to the customer. Sir, the most common type of "third line forcing" can be found in lending arrangements. Take this for example. Before lending money for the purchase of a new home, a bank requires the borrower to take out home insurance. Unless the borrower insures his home with the insurance companies stipulated by the bank, the bank will not approve the loan to the borrower. The effect of this arrangement limits the choices to the borrower. This type of arrangement is illegal in Australia, a country advanced in terms of its statutes, legislation and court processes. Sir, we have adopted much of Australian legislation, such as the Land Titles Act, the Companies Act and also their mediation and dispute resolution processes. The rationale of making "third line forcing" illegal under their Trade Practices Act is that it snuffs out competition, which can only be beneficial for the citizens. There is, however, a slight inadequacy in the Australian Trade Practices Act which we may further improve on. Their law only stops arrangements between the supplier of goods or services and a third party. Their law does not prohibit a supplier requiring the customer to purchase another product or service of the supplier. If the third party were a subsidiary of the supplier, section 47 of their Trade Practices Act would not prohibit the supplier from forcing the customer to purchase products from itself and its subsidiary. Will the Minister for Trade and Industry consider introducing a similar Fair Trading Act in Singapore?

Sir, I have previously raised in this House the issue of the dangers of buying foreign properties. These properties are usually promoted in Singapore by developers and it has never failed to amaze me that many members of the public can part with large sums of money, purely on the basis of mock-up models and beautifully designed brochures. I distinctively remember telling myself then, when these foreign properties were first promoted in Singapore, that the buyers may run into problems with the properties as this is an area which is very poorly regulated. Unfortunately, my misgivings have proven right. We have seen many disappointed buyers venting their frustrations in the press or at the sales offices on how they have been short-changed, either in the form of shoddy construction or uncompleted buildings. Examples of such incidents are numerous. But to be fair, not all foreign property developers are out to deceive local purchasers. There are, unfortunately, enough of them out there to cause some concern. As you are aware, if anyone were to attempt to sell any security interest in Singapore, the law requires substantial disclosure of information by the promoters and lodged with the authority before promotion of such security interest may be allowed. The information memorandum would typically contain information of the company, its history, business, principal officers and finance and information on matters which are material. The idea, principally, is to allow prospective investors to make an informed choice. Unfortunately, such requirements are not required for promoters of foreign properties where financial exposure can be just as substantial as investment in shares and other securities. It does seem, Sir, to be a bit of anomaly. I understand that the Government's position has always been based on the principle of caveat emptor. However, if the law does not provide a framework where sufficient information is given and where promoters do suffer from a real prospect of being liable for such promotions, it would be quite difficult for investors in foreign properties to make informed choices or to enforce their rights. 1.00 pm Sir, in 1998 and also in 1999, I made a similar comment, and the Finance Minister had informed me then that the Government would consider an Estate Agents Bill to regulate the sale and promotion of foreign properties. I would appreciate it if the Minister could inform this House when the Government intends to introduce such a Bill and to give a rough indication how such activities would be regulated.

Sir, water is a scarce resource. I wish to ask the Minister for details of his Ministry's plan to explore other sources of water, besides our own water and water from Johor. For example, what is the status of the announced plan to start desalination plants? Can the private sector be enticed to participate in the construction of desalination plants? What are the technologies available, and the current economics of desalination plants versus processing of raw water? In addition, I would also like to know whether the Government intends to promote water conservation again. Another idea that has been mooted is to have a dual water reticulation system, ie, one system for potable water and another for industrial water. Is this system, which has been used in other countries, feasible for Singapore?

Sir, I just like to add to the concern Mr Leong has raised. Basically, in the high-tech industries, eg, wafer fabs, chemical industries and pharmaceutical companies, one of the concerns among investors to locate their factory in Singapore is the availability of water. And I think we need to make them feel comfortable that Singapore will have enough water, so as to attract such industries in the future.

Sir, the points I wish to raise have already been raised by both Mr Leong Horn Kee and Mr Inderjit Singh.

Sir, the prices of electricity tariffs have increased quite substantially, by 20% in the last few months. Most local manufacturers are complaining and, in fact, are very concerned. This is due to the sharp rise in oil prices in the last few years. For example, oil prices actually increased from US$11 in 1998 to nearly three-fold, to $32 this week. Singapore is very dependent on external sources for energy, especially on crude oil for our electricity generation. I would like to know how to make the energy sector more efficient. For example, electricity generation can be deregulated so that more companies can be allowed to participate in electricity generation in Singapore. If a company can find it useful and cheaper to generate its own electricity, and even have some spare power to sell to other users, they should be allowed to do so. Moreover, in view of the rising electricity prices, would it be worthwhile to reactivate the energy-saving campaigns?

Sir, I would like to ask the Minister to address the following policy and structuring issues: First, the role of the regulator post-exercise. To what extent will the regulator play a price stabilisation role, especially for households, for example, during periods of price volatility as players establish their relative market position? In several markets, price volatility can sometimes prevail for two to three years. Will the regulator be charged with any responsibility as far as the overall supply capacity is concerned, for example, during a downturn or simply an over projection of demand, which if given entirely to market forces, might cause prices to collapse, ultimately to the detriment of the generating companies? Whilst consumers may rejoice at collapsing prices, they may, at the same time, be shareholders of these generating companies. Secondly, the structure of industry. From the perspective of promoting certain industries, which may be energy-intensive, who would help ensure that prices make economic sense for them? A larger question would be whether the allocation of the pool by user groups, ie, households, large consumers, will be incorporated as part of the supply structure? Finally, would the transmission portion, ie, the existing Power Grid, which will be a natural monopoly, include the distribution role as well? Otherwise, would we run the possibility of over providing for energy distribution if each player were to build its own infrastructure?

Sir, Sentosa Island brings back fond memories for many of us. During our younger courting days, many of us spent happy hours there. But I wonder how many Members here have recently been to Sentosa. Sentosa is still one of the few popular places for recreation and sports for locals and tourists. But, sadly, I feel that the place has lost its novelty and attraction. Therefore, I wish to urge the Minister to look into spending more money to revive and improve Sentosa. For a start, the existing access and transportation should be improved. The monorail system there is very slow, old, inefficient and it only goes in one direction. In fact, new attractions can be added to make the place more interesting. Why not add some roller coasters or more fun and interesting rides to thrill the visitors? We should also encourage more outdoor activities there like windsurfing, boating, horse riding, kite flying and so on. At present, the entrance fees to the various attractions are too high and are a deterrent to visitors. I have computed that the entrance fees to Sentosa and to all the attractions, such as Fort Siloso, Underwater World, Fantasy Island and so on, cost a total of $93.50 for an adult, and a total of $57 for a child. It is not cheap, even by Singapore standards. So, to make Sentosa vibrant and affordable, I would like to suggest that the Government should treat the capital expenditures for the infrastructure and the facilities at Sentosa as grants to be provided for the recreation of Singaporeans. Sentosa Development Corporation (SDC) should be required to recover only the operating cost. This is the same principle used for the SMRT, where the capital expenditures for the fixed stocks and the rails are treated as Government infrastructural grants. SMRT is only required to recover the operating cost. Therefore, I would like to urge the Minister to direct his officers to do a quick and comprehensive review of Sentosa.

(In Mandarin): Sir, Sentosa is our tourist attraction. Especially in the evening, it is very beautiful. It has all kinds of recreational facilities for locals and tourists. Recently, I was given an opportunity to visit Sentosa when I was invited to the Beach volley ball and mini-golf tournament. During these visits, I noticed that this place of interest was extremely quiet in the night, except that on occasions, when the Sentosa Development Corporation organised a foam dance or a concert by Taiwanese singer "Ah Mei". I encourage my grassroots organisations to organise visits to Sentosa, but they told me that the admission fees are so high that it put them off. I understand that if you go there by bus or on foot, you have to pay $6 to enter. But if you drive in, they charge you $10. If there are five people in the car, each person is charged just $2. If you go by car, you pay $2 but if you walk in, you pay $6. I think $6 is too high. Admission charges should be lowered and standardised. Sentosa is part of Singapore. All citizens should be entitled to go there at a nominal charge of $2 per person. Senior citizens should pay half price or even free. Then more people will be attracted to Sentosa for recreation. Secondly, I would like to suggest that Sentosa should be further developed. I agree with Mr Leong's suggestion that it must have more facilities. During the weekend, there could be some pasar malam at the beach. We can also have hawker stalls to sell local food like Malay satay, Indian roti prata and Chinese char kway teow. We could also invite cultural groups and all kinds of local performing groups to perform their arts, so as to attract more people to Sentosa, instead of going to the neighbouring countries and subject themselves to the nuisance of being caught in traffic jams. Let us turn Sentosa into a Bali or Pattaya.

Sir, I thank Members who have spoken on MTI's budget. From the issues raised and the suggestions made, it is clear that all of us are seized by the challenges posed by the new economy. To thrive in this new environment, we have to ride the wave of technopreneurship, strengthen our SMEs, help them restructure, develop promising emerging industries, and ensure that we remain cost competitive by developing new capabilities and deregulating the key services sectors, including utilities. Globalisation and ICT have changed the nature of competition. Start-ups which are small but nimble can now compete head-on with big and established companies and win. The new environment is a great threat to traditional industries. It also opens up all kinds of new and exciting opportunities. As Mr Leong Horn Kee, Mr Inderjit Singh and Mrs Lim Hwee Hua pointed out, how well Singapore thrives in the future depends critically on how well we are able to arouse a new spirit of entrepreneurship amongst Singaporeans, especially among young Singaporeans. This requires changes at two levels. First, a fundamental change of mindset in both the public and private sectors with regard to matters like risk taking, tolerance for failure and international benchmarking. And we must allow for some untidiness in our system so that there is room to make changes and innovate. Second, the mindset change must lead to specific reviews of systems, rules and regulations, so that we do not, wittingly or unwittingly, impede entrepreneurial efforts. All of us have heard horror stories by young budding entrepreneurs about the difficult problems they face, and we should address that. We have taken steps but, as Mr Leong and Mr Singh proposed, we must do more to free up the system for initiative and enterprise. Our tax system should also favour greater risk taking. Start-ups find employee stock options (ESOP), which are given in lieu of cash salaries, very helpful. In his Budget Speech, the Finance Minister has announced Government's intention to enhance the tax treatment of ESOP. My Ministry is working closely with the Ministry of Finance to announce a revised scheme by the end of May. Mr Ahmad Magad, Mr Leong and Mr Singh have highlighted the importance of adequate venture funding to help technopreneurs succeed. To catalyse such venture investments, NSTB launched the US$1 billion Technopreneurship Investment Fund (TIF) and the Business Angel Fund last year. The TIF is managed by NSTB and GIC, which work with private sector venture capitalists and business angels to coinvest in promising start-ups and venture funds. And as Dr Tony Tan announced in San Francisco recently, more than half of the fund has been committed. We will review, within a few months, whether a second fund, or some other initiatives, will be needed to continue the momentum that has been achieved so far. Mr Leong suggested the establishment of a third fund which is wholly managed by the private sector. In fact, the existing funds are already invested through the private sector. Each is, in fact, a "fund of funds". Because we do not have the expertise, we do not do the investments ourselves. I assure Mr Singh that NSTB is recruiting experienced and industry-savvy people into its ranks, and they have to be incentivised appropriately, of course. And this is a general problem for officers who work in the statutory boards and the civil service - how do we ensure that they are not just on fixed salaries and their rewards are somehow tied to their performance. Otherwise, the regulator, looking at the people he regulates, will feel a certain envy that he is not on the other side. So this imbalance must somehow be corrected in the way we remunerate the officers in the statutory boards and in the civil service in the future. But it is not an easy problem. We have got to do some hard thinking on this subject. We can only succeed by being part of a global network. We must have good links with the critical high-tech nodes in the world and tap top global talent, the way Mr Inderjit Singh suggested. Let me here assure Mr Thomas that the Singapore Government and its agencies encourage our businessmen to be good corporate citizens in the countries they operate. We have a collective reputation to protect and this collective reputation, which is a good reputation, is a common asset which we all have, particularly when we are overseas. 1.15 pm Knowledge is a key resource in the new economy. We are therefore strengthening our entire infrastructure to generate, protect, manage and exploit intellectual property. Singapore's legal framework for intellectual property protection has been ranked highly by international agencies. But as Mr Inderjit Singh suggested, we should do more in the areas of intelligence gathering and analysis, licensing, technology transfer, valuation and management of IP. On the Science Hub, the geographical focal point of our Technopreneurship 21 efforts is the Buona Vista area. As Mrs Lim Hwee Hua, Mr Leong Horn Kee and Mr Inderjit Singh suggested, we want the Science Hub to be a hotbed of technopreneurial activities with offices and watering holes for inventors, researchers, investment bankers, venture capitalists, lawyers, and e-commerce experts to meet, exchange ideas, stimulate each other's thinking and to strike deals. In addition to incubators and offices, the Science Hub will also have entertainment and residential facilities. It will be well served by a good transportation network including an LRT line and all the bandwidth which may be needed. Many start-ups are already operating at the Science Park. More are moving into incubation units set up by JTC at the Ayer Rajah Industrial Estate which is within the vicinity. To provide more space at low prices, and it is important that we provide more space at low prices, the Government will renovate existing buildings such as the unoccupied bungalows at Wessex Estate and Rochester Park. We will consider renovating old buildings in the area in the nearby army camps that have been vacated and even at Alexandra Hospital when they move somewhere else, equip them with broadband so that the technopreneurs can take up space cheaply and start business with low barriers to entry. For a quick start, we may even truck in porta-cabins to provide additional incubator space. The Government is looking at different management models for the Science Hub. We will establish a dedicated agency, which may be a statutory board, to drive the long-term development of the Buona Vista Science Hub. Presently, the one-stop agency which Mr Ahmad Magad asked for is NSTB. The T21 Plan and its various programmes will help prepare us for the New Economy. The current dot.com boom is also helpful in the way it draws talent, resources and public attention to this new sector. But, as Mr Inderjit Singh and Dr Toh See Kiat cautioned, we must also be aware that the boom which has spread from the US to our region is bubbly in character. When IPOs are hundreds of times oversubscribed just because they carry dot.com, we should worry. This does not mean that we should discourage start-ups because of the high failure rates. Although the risks are high, so too are the rewards. From a detached standpoint, bubbles perform an economic function by the way they suck technological and financial resources into new areas of growth. Even when they burst after that, the transfer of resources is positive for the long term growth of the economy. The lessons learnt through failures help us to succeed in the future. However, one should not invest money or speculate in dot.com companies thinking lightly that they are one-way sure-fire bets. In this respect, the recent warnings by Mr Arthur Levitt, Chairman of the US Securities and Exchange Commission is worth repeating here. He said "unless investors truly understand both the opportunities and risks of today's market, too many may fall victim to their own wishful thinking". As in all investments, there is no substitute for deep knowledge of the industry and careful assessment of the company we are thinking of investing in. US Treasury Secretary Larry Summers put it very well recently when he said that the New Economy must still be built on old virtues. Another exciting growth sector, which Mr Inderjit Singh touched on, is the life sciences. Advances in the life sciences will open up a whole new frontier and spawn new industries. We must position ourselves for this new wave. The life sciences is likely to become the fourth pillar of our manufacturing sector, after electronics, chemicals and engineering. EDB will drive its development under Industry 21, as will NSTB. Because we recognised the potential of biotechnology some 20 years ago, Singapore is already a pharmaceutical-manufacturing hub in the world. Our universities and research institutes, especially the Institute for Molecular and Cell Biology (IMCB), have made good progress in the life sciences. We also have excellent healthcare facilities and doctors. Upon this foundation, we hope to build a world-class hub for the life sciences, with capabilities in various fields including basic research, manufacturing, medical engineering, regional headquarters functions and, of course, medical services. We are lucky to have world experts helping us in IMCB. IMCB's original godfather was Dr Sydney Brenner, a South African Jew of Lithuanian and Latvian extraction. In Cambridge, he achieved world fame working with Francis Crick who won the Nobel Prize for the work on the double helix of the DNA. Dr Brenner himself discovered messenger-RNA which takes the code from the DNA and directs it to the protein making factories in the body. He made many other important discoveries. After retiring from Cambridge, he moved to California, teaching at Berkeley and San Diego where he helped to start many new companies which are now household names. One of them called Lynx, recently discovered a way to detect defective genes found in some diseases. As a result of which the company is now worth a fortune and Dr Brenner who has many founder's shares in that company, has come across a large sum of money, a portion of which he intends to establish a foundation. This is quite a feat for a retirement job! It is remarkable that what started as a retirement job should become such an exciting proposition. Happily too, we have some investment in Lynx. In addition to Dr Sydney Brenner, Dr David Baltimore, another Nobel Laureate and President of Caltech, and his Chinese wife, Dr Alice Huang, the Chairperson of IMCB's Scientific Board, have been absolutely wonderful in the way they have supported IMCB and guided Dr Chris Tan and his team in IMCB's work.. Today, IMCB is an internationally renowned research institute because of their help. Over the years, Mr Philip Yeo, who is the Chairman of EDB and IMCB, has built close personal friendships with top men and women in the life sciences in many countries. With their help, we will build up our capabilities in this most important field. This year, the entire human genome will be mapped. This is an epochal event in history. But there is still a lot of work to be done to research into the genetic variation between human groups, between individuals, and between normal human beings and those who suffer from cancer and other genetic diseases. We are well-placed in Singapore to do our share in Asian genomics research because of our ethnic diversity and our excellent healthcare infrastructure. Our capabilities in information technology and biomedical engineeering are also a big plus. The life sciences is a field that will open up new and exciting opportunities not only for our doctors and life-sciences professionals, but also for investors and entrepreneurs. To move ahead, we will have to strengthen further our research capabilities, integrate better the work in the research institutes and hospitals, and promote investment and entrepreneurship across the entire life sciences sector. Mr Heng Chiang Meng asked about the promotion of environment-related industries in Singapore. In fact, this is being done by EDB. We promote the entire cluster including incineration facilities, waste recycling, systems manufacturing, water systems, engineering services, consultancy and R&D. To improve our capabilities, we have been supporting R&D in some aspects of environmental technology. We encourage foreign companies to form partnerships or joint ventures with local firms. The Ministry of the Environment also plays an active role in promoting Singapore as a regional hub for environment-related industries. Mr Leong Horn Kee and Mr Inderjit Singh asked about the cost competitiveness of the manufacturing sector. The fundamental need here is to remain cost competitive in the New Economy. Besides ensuring that our wage growth does not exceed productivity growth, we need to keep other business costs low, including electricity, gas, water and port charges. The best way is to introduce more competition wherever possible. This will also achieve the international benchmarking which Mr Ahmad Magad proposed. Both Mrs Lim Hwee Hua and Mr Leong Horn Kee argued that we should open up the electricity and gas markets, allow more players in, in order to bring prices down. Part of the increases, which are because of the recent rises in oil prices, cannot be helped. But whatever the level of oil prices, we should be as efficient as possible. Three weeks ago, I informed this House that we would open up the electricity and gas markets to competition. The details will be released today. Let me here give the highlights. In 1995, the Government decided that the electricity market should be restructured from a state monopoly into a competitive regime. The question was the scope and pace of deregulation. We were then among the pioneers in the world and we decided that because of the complexity we should move cautiously in an evolutionary way. Since 1995, many more countries have deregulated their electricity industries, resulting in lower prices, greater product innovation, and better services for consumers. We have now fallen behind because of our more cautious approach and must therefore move decisively again. Investors have also complained that our market rules lack clarity with PUB as regulator having to intervene in the market too often. Retail competition, although allowed, has not happened. EDB has received feedback from some MNCs that our electricity tariffs have become less competitive and reduced our overall competitiveness in their eyes. MTI therefore initiated a major study last year together with Temasek Holdings. The key objective was to implement an electricity market structure and regulatory framework that will support a competitive industry in Singapore, while ensuring that reliability and every security are looked after. The experiences in the last five years and the significant improvements made by Singapore Power have given us confidence to press on with further deregulation in order to derive the full benefits of competition. Specifically, this requires, at its core, a clear separation at the ownership level of the contestable parts of the market from the monopoly parts of the market. The grid, which is a natural monopoly, should not be owned by the same company that owns generation companies or retail companies. Last year, we informed this House that Singapore Power will divest its ownership of its generation companies and transfer them to Temasek Holdings by April 2001. We will press on with this decision and go further. Temasek will divest all three generation companies. There will be no foreign ownership limit. We have decided to lift the restriction on foreign ownership to increase competition and raise our standards to international levels. Energy security will not be a problem because foreign owners cannot walk away with their power plants. In an emergency, the workers are still here. There are Singaporeans to operate them. These three existing gencos and the new co-generator on Jurong Island will support a competitive market and lead to lower wholesale electricity prices. Mrs Lim Hwee Hua asked about price stability in the transitional period. During the transition, we will put in place measures such as vesting contracts to prevent excessive volatility in pool prices while allowing the market to find its own level. As for the question on security of supply, we will first rely on a well designed market which allows price signals to flow through. PUB will play a watchdog role to ensure that there is sufficient capacity planning. The electricity retail sector is also contestable. But to-date, PowerSupply, which is wholly owned by SingaporePower, is the only retailer in the market. This is not desirable. Retail competition is important as it enables the benefits of competition upstream to flow through to the end consumers. Retail competition will also bring about greater choice. In New Zealand today, an ordinary household has more than a dozen companies to choose from. To bring about retail competition, we need to provide first a level playing field for new entrants into the retail segment. Singapore Power will therefore divest the retail business of PowerSupply from 1st April 2001. This will separate the ownership of the retail business from PowerGrid. With these and other measures, we can look forward to full retail competition for large industrial and commercial consumers from April 2001. Retail competition for smaller customers and households will take longer and is not likely to take place before year 2002 because a detailed study must first be done. Once it is done, we expect domestic consumers to enjoy lower charges and a wider range of services. I assure Mrs Lim Hwee Hua that we will pay particular attention to the impact of these changes on households. 1.30 pm Mrs Lim has asked about PowerGrid. Unlike the generation and retail sectors, the transmission and distribution network is a natural monopoly. It will be neither practical nor cost-effective to have competing grid companies duplicating power lines on our small island. The grid will therefore be tightly regulated. Performance standards will be set and PowerGrid will be incentivised to improve efficiency further. The system operating function would be taken out of PowerGrid and put directly under PUB. This will assure investors of fair play. I will now move to changes in the gas sector. The gas industry will be restructured in a similar way by separating the ownership of the gas transportation network, which is a natural monopoly, from the contestable sectors of gas import, trading and retailing. The entire gas distribution and transmission network will be owned by a gas grid company which will allow players open and non-discriminatory access to the network. SembCorp Gas will have to give up its business of transporting gas if it stays in the contestable business of importing and retailing gas to large users. SP has indicated that PowerGas prefers to stay in the gas transport business, and this would mean that SembCorp Gas will have to get out of it. The gas grid and the electricity grid, which are both natural monopolies, can then be owned by Singapore Power. Although the privatisation of Singapore Power will be slightly delayed, we still hope to carry it out by the end of 2001 or early 2002. After this restructuring, Singapore Power will be the power and gas network provider in Singapore. The changes that I have outlined today are substantial. Implementing them will take about 15 months or so. In making the changes, we must be fair to Singapore Power staff who support privatisation and have been gearing themselves up for increased competition. I met Singapore Power management and key union leaders of UPAGE two days ago. They had earlier been briefed of the changes that we are going to make. They gave me many useful comments and suggestions which I have incorporated into my statement to you today. I understand the difficulty which the union leaders face explaining yet more changes in the industry to Singapore Power staff. Without the understanding and support of Singapore Power management and the union leaders, the process of restructuring will be slower and much more complicated. Mr Inderjit Singh commented on power dips. Although power dips occur in all systems, the five dips that we had last October were not at all acceptable to us, and many companies involved suffered great losses. In Singapore, where the grid is buried, we should be much less affected by such disruptions. In the past, our cables were occasionally damaged by construction contractors against which our laws were amended last year to provide stiffer penalties. While we cannot prevent power dips completely, we must work harder to reduce them. All parties which are responsible must exert themselves in this direction. PUB is also working with EDB and PowerGrid to provide premium quality power for customers who need very high reliability, like those in the chemical industry and in wafer fabs. These customers will, of course, have to bear part of the additional cost incurred. Mr Singh and Mr Ahmad Magad spoke on the important subject of water. Let me assure Members that, one way or another, we will ensure that there is adequate water supply in Singapore for all our needs. PUB's demand forecast has factored in the requirements of all future users including wafer fab, chemical and petrochemical plants. Fortunately, technological advancement is working in our favour. We are surrounded by the sea and desalination, although expensive, is already affordable. Desalination technology is advancing rapidly and likely to bring desalination cost down in the future. We are closely monitoring developments and looking into doing some research ourselves in our universities on the desalination of tropical water where it is warmer and has biological content. We had earlier announced our intention to build a 30 million gallon per day (mgd) desalination plant by the year 2005. Based on the advice of its consultants, PUB wanted this first plant to adopt Multi-Stage Flash (MSF) distillation technology. This is a track proven technology which has been used extensively in desert countries to supply large quantities of fresh water. However, recent experiences in the US and Europe show that other technologies such as Reverse Osmosis (RO) and Multi-Effect Distillation (MED) are becoming significantly cheaper. For example, using the RO process, the price of recently contracted water has come down to between $0.84 and $1.20 per cubic metre, compared to about $2 per cubic metre using Multi-Stage Flash distillation. As MSF may no longer be the most cost effective solution, we have decided to change our original decision and leave the choice of technology for the new desalination plant open. We completely agree with Mr Leong and Mr Ahmad Magad that the private sector should participate in the supply of desalinated water. Instead of PUB building and running all the desalination capacity, it will commit to buy a minimum quantity of desalinated water for a minimum period of time. The private sector will then be invited to bid for these supply contracts. It is then up to the tenderers to choose the best technology and the optimum plant size to meet our requirement. PUB will then choose the best option or options from the bids received. In this way, we lower the cost of consumers and access a wider range of technology. PUB is looking into the operational details and will call for tenders early next year for the delivery of about 20 mgd of water by the year 2005. At the same time, the Government will own and operate a smaller desalination plant of about 10 mgd, for PUB to understand more fully the technology to go into its operations in-depth and to gain operating experience. But even as we continue to explore alternative sources of water, we must not let up our water conservation efforts, a point which Mr Leong made. Large users must be encouraged to recycle water where economically feasible. Where appropriate, we encourage the substitution of potable water by non-potable water. Industrial water is currently used widely in Jurong and Tuas. To extend its usage, industrial water pipes were recently extended to Jurong Island and will be extended to Tuas View Extension later. Mrs Lim Hwee Hua raised a point on Jurong Port, which is our major port for bulk and conventional cargo. It also handles some containerised cargo. Jurong Port has been upgrading its facilities to serve better the increasing needs of companies in Jurong Industrial Estate, Jurong Island and Tuas. Jurong Port will install container quay cranes to increase its productivity and provide better service to its customers. However, Jurong Port does not intend to go into the container transshipment business. This is best left to PSA which also faces fierce competition from other ports in the region. JTC will corporatise Jurong Port by the first quarter of next year. As Mrs Lim pointed out, Jurong Port as a corporatised entity will be better able to respond swiftly to market trends and customers' needs. JTC can then concentrate on its core business of providing world-class industrial facilities and providing innovative business solutions for the new economy. Corporatisation will also ensure that Jurong Port does not receive any hidden subsidy from JTC in competing with PSA for the domestic container business. Mr Sin Boon Ann and Prof. Toh See Kiat spoke on the need for anti-trust laws. This is a complex subject about which there is no agreement even among advanced economies. The issue of cross-border monopoly is a very difficult one. The US acts under Sherman and MaClaren, but it does not want others to have similar acts. The US operates a unique regime because of its size and historical distrust of government. The EU adopts a different approach. As a city state, the best way for us to curb monopolies is to open our doors to trade in both the goods and services sectors. We are not likely to need a comprehensive anti-trust law as in the US. But we will study how legislation can be improved to enhance competition, which was a point made by Dr Lily Neo. We will progressively amend our laws and regulations to open up as many sectors to competition as possible. As for fair trading legislation, I leave it to Mr Tang Guan Seng to reply later. Mrs Lim Hwee Hua asked the Government to put up more economic statistics on Singapore and the international economy in a timely way. Our Department of Statistics consults frequently with industry players, academics, and investment analysts. We welcome suggestions. On services, we have put on more data since last year. On GNP data, I am happy to announce that we will release it on a quarterly basis from the first quarter of this year. Sir, I will now leave the other replies to my Minister of State and my Senior Parliamentary Secretary.

Sir, I have two cuts. May I get on with these so that the Minister can reply.

You have to come back after Mr Lim has finished, if there is time. Mr Lim.

Sir, I would like to start with the two cuts on industrial land. Mr Leong Horn Kee and Mr Inderjit Singh suggested intensifying our land use to cut business cost and the need to keep land cost for manufacturing competitive. We agree with them. JTC has extended rental rebate to the end of this year and will pass on the property tax savings to their tenants. But our land cost cannot be as low as those of our competitors simply because land is scarce here in Singapore. Therefore, we need to intensify our land use. Our current efforts today include introducing innovative design such as multi-storey factories, integrating suitable non-industrial use with industrial development in vertical mix-use development, and developing industrial buildings over MRT depots and sewerage treatment plants. I am also pleased to share with the House that we are looking into lowering the differential premium (DP) for industrial land to encourage industrialists to build higher. Sir, besides building higher, we also need to build better. Our industrial landscape will have to keep pace with the needs of the new economy. To cater to the requirements of the knowledge workers and knowledge-driven industries, we have to incorporate innovative design and features in our industrial facilities. Since 1996, new and refurbished JTC industrial buildings are fully ready for broadband access. JTC is now going one step further by working with the service providers to bring broadband services content to new development in the Science Park, Business Park and Ayer Rajah Technopreneurs Centre. In Paya Lebar and Senoko, JTC is experimenting with a new kind of industrial park. We will adopt the community-based approach in the planning and development. This new industrial park will be a place where tenants can seek and congregate for not only good jobs but also quality housing, active liftestyle in a congenial work environment. This will bring about a transformation in Singapore's industrial landscape, offering enhanced quality of life to both the local and foreign talents, thereby strengthening Singapore's competitiveness as a KBE. Sir, I now move on to the cuts relating to the SMEs. Mr Tay Beng Chuan is concerned that Government support may be targeted at successful local enterprises to the neglect of the broad-based SMEs. Sir, the Government offers a broad range of assistance schemes to meet the needs of our SMEs. Last year, more than 2,000 SMEs were awarded a total of $42 million worth of LETAS grant to upgrade their systems and processes. 90% of the grants went to SMEs with less than 50 employees. We also approved a total of $340 million worth of LEF loans to about 1,000 SMEs. Again, 90% of the loans went to SMEs with less than 50 employees. If we take into consideration non-financial assistance programmes offered by the PSB, the total number of SMEs assisted came to more than 5,000 in 1999. I would like to assure Mr Tay that the Government has been providing assistance to a broad base of SMEs and will continue to do so under the SME 21. The global economy is going through the e-revolution driven by the rapid penetration of Internet all over the world. Several MPs, including Mr Inderjit Singh, Mr Ahmad Magad, Mr Zulkifli, have expressed their concern that many SMEs have yet to embrace Internet and pursue e-commerce as a business strategy. Sir, I share their concern. We need to help as many of our SMEs as possible to be e-ready as quickly as possible. On their own, we recognise that many of our SMEs do not have the resources and the expertise to be e-ready. PSB and IDA are working together to help them overcome these obstacles. Mr Ahmad Magad suggested that the Government should offer financial assistance to SMEs and promote the adoption of locally available portals. These are good ideas and I agree with them. 1.45 pm Sir, we are taking steps to promote the development of vertical, horizontal, corporate and SME portals in Singapore and these portals will have regional and global connections. These will make it easier for SMEs to integrate themselves into the business value chain of various business sectors, making it easier for them to carry out B2B and B2C transactions in our local cyberspace, regional cyberspace as well as the global cyberspace. We are also helping our SMEs to learn to exploit the full potential of e-commerce in their businesses. SMEs can now obtain up to 70% of funding support from the PSB for their feasibility studies and consultancy services. For those SMEs which are ready to implement e-commerce under the Local Enterprise Computerisation Programme (LECP) for e-commerce, jointly managed by the PSB and IDA, SMEs can obtain a grant of up to 50% of the cost of the e-commerce project, subject to a ceiling of $20,000. Today, more than 300 grants, amounting to $4.5 million, had been granted. Our target on the whole is to help 25,000 SMEs to be e-ready over the next five years. This is an ambitious undertaking and we have just started. Sir, many of our SMEs have the potential to grow into world-class companies and global players in the KBE. Mr Leong Horn Kee, Mr Inderjit Singh, Mr Zulkifli and Mr Ahmad Magad have highlighted the need for Government to help our promising local enterprises (PLEs) and promising SMEs (PSMEs) develop into global players. Some Members suggested that our SMEs could overcome the limitation of small size through consolidation and partnership. I agree with them. Under the PSB's Business Connect programme, we organise business missions for our SMEs to meet up with potential partners in countries like Canada, Taiwan, Japan, Australia and France. So far, about 3,000 SMEs have participated and more than 800 joint ventures have come out from these trips. We will continue to facilitate such cross-border partnerships. Mr Inderjit Singh is concerned that our PLEs' selection criteria may be outdated. Sir, the existing list of criteria is both quantitative and qualitative, covering areas such as capabilities and innovation, professional management, market potential and international orientation. I think these criteria are broad enough and are necessary for success in the global environment. However, I do agree with Mr Inderjit Singh that we have to be mindful that the world is changing very rapidly. Our economic agencies are doing their best to look ahead and be as responsive as we can to this global trend. Even so, there could be times when we are behind the market. What is important is for us to know when we are behind and be able to respond quickly. So on the part of the SMEs, they can help us to transform the identification of the PLEs into a self-nominated and self-selection process. SMEs that believe in their potential could present themselves to PSB for assistance under the promising SME programme. Others could approach the EDB under the PLE programme without waiting to be spotted. Likewise, innovative start-ups can go to the NSTB for incubation assistance or venture financing. The role of the economic agencies is to offer developmental support to as many promising and deserving companies and projects as possible. It is then up to the companies to pass the market test, succeed and become global players. Mr Inderjit Singh felt that we have not been able to find the right formula to help SMEs to be world class players. I agree that we are not prefect. But I think the Member will agree that we are making some good progress as well. In 1995, EDB set targets to nurture 100 PLEs with annual turnover of $100 million in 10 years. I am pleased to report to this House that, by the end of 1999, 45 PLEs have achieved the annual turnover target of more than $100 million, up from 31 in 1998. Last year, 23 PLEs made it to the Business Times Enterprise 50 Awards. There are altogether 350 PLEs now being nurtured by the EDB. And we expect the list to grow further. As for the promising SME programme managed by the PSB, there are now 786 SMEs on the list and 16 of them have made it to the Enterprise 50 list since 1996. So on the whole, we are encouraged by the progress of the PSME and the PLE programmes. Sir, as we liberalise our markets and transit into the KBE, we will need to speed up the transformation and redevelopment of some of the traditional sectors in Singapore. Our immediate focus is to upgrade two domestic services sectors with persistently low productivity, the retail sector and the construction sector. Mrs Lim Hwee Hua asked how can economic agencies reach out to the non-English speaking SMEs as well as the job placement and retraining of redundant workers. Sir, take the retail sector, for example, it is highly fragmented due to the low barrier of entry. Our retail density is among the highest in Asia and, yet, its productivity level is less than half of the national average. PSB will work closely with the Shopkeepers' Association to reach out to neighbourhood shop owners and operators, including those who are non-English speaking to restructure and double the productivity of the industry. We will support retraining of workers through the SRP and the SDF. We are also working with the HDB to reduce the retail space in those neighbourhoods where there is access by allowing for alternate use. Sir, in launching SME 21 early this year, our collective vision in the private and public sectors is to create a vibrant and resilient SME sector that would enhance Singapore's competitiveness and the economic growth. Several MPs have raised concerns about the implementation of SME 21. Mr Inderjit Singh suggested spinning off part of PSB into a consortium jointly managed by the private and public sectors. Mr Tay Beng Chuan is concerned that we may pay more attention to MNCs and large local enterprises and neglect the large number of SMEs. Sir, we recognise that it is not possible for PSB alone to reach out to all the 100,000 SMEs in Singapore. It is never our intention to go it alone. At the launch of the SME 21, we invited business organisations and private sector organisations to come forward with specific ideas and initiatives. We hope industry associations will play an active role in helping our SMEs realise their full potential. I am pleased to say that some industry associations have already been appointed approved-in-principle (AIP) agencies for PSB's grant scheme, LETAS. This includes the Singapore National Employers' Federation. We look forward to appointing more AIP agencies in the private sector. The role of PSB as an economic agency is to provide the overall coordination and keep track of the Board's main interest of the SMEs, including those SMEs without any strong industry association. Mr Tay Beng Chuan asked about funding for SME 21. Sir, SME 21 programmes will be funded under existing grant and loan schemes. For this year, we have set aside $500 million for LEFS loan scheme and $35 million for LETAS grant. The Government will continue to assess the situation. As and when needed, additional developmental funding will be launched. The recent launch of a $20 million Industrial Productivity Fund (IPF) is a case in point. In response to the comment by Mr Tay, our Ministry would suggest to the Ministry of Finance to consider grouping all SME-related fundings into an SME account in future years.

Sir, let me reply to the two remaining subjects raised by MPs. They are the development of Sentosa and consumer protection. First, on Sentosa. Mr Leong Horn Kee and Mr Ang Mong Seng have made a number of suggestions to improve the attractiveness of Sentosa. The Government has been a great supporter of Sentosa. Since 1972, the Government has invested about $300 million on Sentosa for infrastructure and attraction development, and vested the entire island to the Sentosa Development Corporation. I would like to inform Mr Leong that they are getting as good a deal as SMRT. It is now up to Sentosa to further exploit its assets to improve the quality of life for Singaporeans, besides being a tourist paradise. Sentosa can be our special resort island for Singaporean families to enjoy both in the day and at night. It can also be an exciting place for our tourists. In fact, Sentosa is already the most popular tourist destination in Singapore. To make it even more attractive, we will be introducing a number of major changes. Let me elaborate. Sir, we will build a $140 million people mover system to link Sentosa to the North-East MRT line at the World Trade Centre. This bi-directional system, which is like an LRT, will replace the existing monorail. It has double the capacity. With faster and more trains, waiting time would be much shorter. The system will be partly funded by the Government. Tenders for the system has been called, construction will begin by early 2001. And we expect the system to be running by end 2002 to tie in with the completion of the MRT North-East line. The new system will offer visitors a seamless journey via MRT, from their home to Sentosa. So it is very convenient and this will enhance access to Sentosa in a significant way. Sir, Mr Ang Mong Seng has suggested that the admission charges to Sentosa should be reduced. I would like to inform the House that we will be cutting admission charges significantly to make them as affordable as possible, especially for repeat visitors. There will be special discount schemes for NTUC union members, reservists, school children and retirees. Sentosa will announce the details in due course. The objective is to have as many Singaporeans visit Sentosa as frequently as they wish, whether in the day or at night. Sir, with regard to attractions on Sentosa, visitors will soon be able to enjoy the upgraded musical fountain and the dolphin shows. Sentosa is also considering introducing a hawker stall bazaar and an artist village to add life and vibrancy to the island. The new upgraded musical fountain and cabaret shows at the Fantasy Island will anchor our efforts to promote Sentosa as a popular night destination for food, drinks, entertainment and parties. With more visitors to the island, the existing attractions will also have greater commercial incentives to be upgraded. 2.00 pm We will launch the land sale for Sentosa Cove later this year. When fully developed, this integrated waterfront leisure and residential development will bring a unique lifestyle to Sentosa. In short, we are moving Sentosa into its next phase of development. We will be building on its sound foundation. Singaporeans and tourists can look forward to exciting changes ahead. The Sentosa Development Corporation will actively solicit feedback and suggestions from locals and foreigners and from experts in this field to help it refine its strategy. To this end, SDC will set up an International Advisory Council to tap on fresh ideas to make Sentosa even more attractive. Sir, let me now go on to talk about the issue of consumer protection which was raised by Prof. Toh See Kiat, Mr Thomas Thomas, Dr Neo and Mr Sin Boon Ann. Consumer protection issues have been raised in this House many times before. Some cases are so bad, they lead rightly to public indignation and calls for legislation to prevent them from happening again. However, I must point out that consumer protection issues cover a wide range and the responses to each of them cannot be the same. For issues that concern public health and safety, or fraud, the Government will tackle them robustly. We believe that the existing legislation is largely adequate for this purpose. But where necessary, the Government will amend our existing legislation to take such fraudulent acts to task. In this regard, MTI is finalising the amendments to the Commodity Futures Act to tackle the problem of bucket shops. This is the problem raised by Members in the past. As suggested by Prof. Toh, my Ministry is also working with the Ministry of Finance on amending the Multi-Level Marketing Act to prevent recurrence of cases similar to S888 in future. We will take CASE's point into account in our work. In this connection, let me take this opportunity to commend CASE for its vigilance in alerting the Government to the S888 problem before it grew out of control. CASE steadfastly stood its ground that such activities were against the welfare of consumers and, as a result, pricked the balloon early. But not all consumer protection cases involve fraud. The majority of cases involve acts of mischief by traders, like the "switch-and-bait" or "third line enforcing" as mentioned by Dr Neo. In these cases, consumers may walk out of the shop feeling cheated. The question then is whether it is indeed possible for the Government to prevent or stamp out every such act of mischief, or even criminalise them. We must be careful not to over-regulate. Every single regulation comes with a cost to business. The additional business cost is eventually borne by consumers. We must therefore weigh the pros and cons carefully. For example, we do not require the same degree of labelling for clothing in Singapore as in the United States. It is easy for us to impose the same requirements, but the result will deprive Singaporeans of cheap clothing from China and elsewhere. The key to better consumer protection is to promote competition in the marketplace, and this is very important. The power of choice is the best check against unfair trade practices. We must maintain a free and open economy so that there are no barriers to the flow of goods and services in and out of Singapore. This allows consumers, retailers and manufacturers to source for products and raw materials at the most competitive prices, locally and from abroad. Consumers must also be alert themselves. In response to Mr Sin Boon Ann's concern, I would say that the Government cannot watch over every foreign property sale. Consumers have to be careful and not go into a contract blindly. But on the Government's part, what we can do is to work with CASE to improve our efforts in educating consumers and disclosing more information, so that consumers can make more discerning choices. Some Members also commented on the cartel-like behaviour in certain sectors. I think one common complaint was the uniformity of petrol prices in Singapore. We will not hesitate to take action should we find evidence of collusion to fix price. However, we must remember that price stability by itself is not proof of collusion. It is well-known in economics that oligopolistic pricing tends to oscillate between high stability and price wars. This is commonly observed in industries like air travel, commodity chemicals and petrol retailing. For a long time there will be no price changes, then one player will break ranks to increase market share and the result is price war which sometimes takes the form of gifts or discounts. The best way for us to stop monopolistic behaviour is to let in the fresh air of competition. One way to prevent such monopolies is to allow parallel imports of items like motorcars. Another way is to let in more suppliers like allowing fleet operators to supply petrol and diesel to their own fleet. We will continue to explore other ways to promote competition. Mr Thomas suggested that the Government enact a Fair Trading Act. As Prof. Toh mentioned yesterday, CASE will be putting up a proposal for such an Act for Singapore. My Ministry will study CASE's proposal when it is ready. However, we must bear in mind the principle of minimal intervention in the market and caveat emptor. If we are not careful, the so-called fair trading regulations can strengthen the market power of some players in the market. In many professional fields, regulations which claim to protect consumers may end up protecting existing players against new competition.

Sir, I would like to applaud the Senior Parliamentary Secretary on the Ministry's stand on the three points that Mr Tang has mentioned. First, to concentrate consumer protection on deception and fraud. Second, to promote competition and competition will lower prices and benefit the consumers. Third, the consumer should be given a choice. Sir, I do believe all these are fair and correct but one of the things in the Fair Trading Act that CASE would want to promote is a legislation that would concentrate on these points. Firstly, there are a lot of areas of deception which are not covered by current law. Secondly, competition can be deviated from by very, very careful tricks which I mentioned yesterday. Thirdly, the power of choice really depends on informed choice and there are no laws that prevent, for example, as in one situation, a house being sold in Australia with a picture of it right next to the Sydney Opera House. That is a deception but there was nothing mentioned which current law could have taken action on.

Sir, thank you for allowing me to just make a few comments. I would like to thank the Senior Parliamentary Secretary for giving us a good reply to my request for improving Sentosa. In fact, I think this is the fastest response I have ever come across in the Committee of Supply. A large $140 million will be given out straightaway after a request has been made. On this point, I would like to ask the Senior Parliamentary Secretary whether this new MRT link will link up with the Sentosa Cove which is the new residential area in Sentosa. I would also like to thank him for the reduction in the entrance fee to Sentosa. How about a reduction in entrance fees to the other attractions in Sentosa as well? The last point is to ask the Minister himself. I did raise a suggestion about pioneer status for start-up companies. Could he comment on the proposal of giving some pioneer status to start-up companies?

Sir, I am afraid the Senior Parliamentary Secretary has missed my point. I am not asking the Government to be watching over every property purchased in Singapore. What I asked for is a framework legislation that will require greater disclosure and strengthening of the legislation to allow enforcement of rights in Singapore. I hope the Senior Parliamentary Secretary can respond to my query.

Thank you for allowing me to ask my questions.

We have not much time left. Can you ask your questions straightaway?

Yes. I would like to ask the Minister about the PUB deposits. I believe that there must be at least a few hundred million dollars worth of deposits held by PUB, and now Singapore Power. What is the amount of money held by Singapore Power as deposits? Is Singapore Power willing to pay interest to consumers on those deposits, and whether Power Supply treats the deposits as part of their assets? Also, is Singapore Power willing to reduce the amount of deposits to customers who have not defaulted on their monthly bills for the last 10 years by the interest they would have earned based on 3% per annum?

Sir, for efficiency, I would take the whole lot of additional questions. Prof. Toh asked about the house in Australia next to the Sydney Opera House. I do not think we can protect against the gullibility of such consumers. You buy a house, you part with vast amounts of money, I think it is incumbent upon you to do due diligence, by talking to people who know property in Australia and not just rely upon the beautiful glossy advertisement. I do not think it is possible for us to legislate against such foolishness. Mr Sin Boon Ann asked about the possibility of amending the law to provide a framework for better disclosure. On that, we will raise the matter with the Finance Ministry. Mr Leong Horn Kee asked whether the people mover system in Sentosa will be extended to Sentosa Cove. Right now, it does not appear possible because it is still a long distance from the main beach, pass Beaufort to Sentosa Cove, and may not be cost-effective. However, we are taking a closer look at that because if we intend to do so, then we should announce it before we have a public auction. Mr Leong asked about his proposal yesterday for pioneer status for start-ups. He acknowledged that the tax benefits are unimportant because these start-ups are not likely to earn money in the first years but he wanted it for recognition purposes. We are looking at that. I will put it to NSTB, which will be giving an award called the "Phoenix Award" for those companies which have failed before and have risen from the ashes to succeed. We will find some other ways to extend public recognition for those who put in good efforts. Mr Chiam See Tong asked about PUB deposits. Once the retail business is privatised, then the issue of whether deposits are required will be left to the retailers to decide. It is a risk that they may take versus the customer goodwill that they hope to gain. As for past deposits and whether interest should be paid, that is part of the bargain. The result has been lower electricity charges which would, otherwise, be the case. If Singapore Power had given interest, then it would have to balance its books by charging higher prices. But this problem will solve itself once we privatise.

We have one minute left. Dr Wang.

Sir, the Minister touched upon the privatisation of Singapore Power and said that it has been slower than expected. I thought one of the stumbling blocks was the valuation of land on which the generation plant was sited. In the next move, will the Minister review this perception and how the land is to be evaluated?

Sir, that is not the key issue. There are existing procedures for valuing land. 2.15 pm

Sir, I wish to thank the Minister, the Minister of State and the Senior Parliamentary Secretary for their excellent replies. May I beg leave to withdraw my amendment? Amendment, by leave, withdrawn. The sum of $365,626,100 for Head W ordered to stand part of the Main Estimates. The sum of $4,275,331,000 for Head W ordered to stand part of the Development Estimates. Head T -

Head T - Ministry of Manpower. Amendment No. (1), Mr Chong.

Sir, I beg to move, That the total sum to be allocated for Head T of the Main Estimates be reduced by $100. Sir, the labour market is changing more rapidly than most workers realise. Advances in technology, especially in IT and communications, are already revolutionising the way we work and the way business is done. Many traditional occupations that older Singaporeans were trained for when they commenced employment may become extinct in the knowledge-based economy. Also, in an era of globalisation where capital and production can move rapidly to virtually any part of the world, our workers must be able to hold their own against the best and the cheapest in the world. It is therefore vital that our workforce be trained and equipped with skills and knowledge that will enable them to remain competitive in this new environment. Many workers are unaware of current trends in the labour market that may have serious consequences on their current employment and future employability. Even as the economy recovers and more and more jobs are created, many workers learn about KBE and structural unemployment the hard way when they face retrenchment, as their skills become outdated or when they are no longer competitive. Some still do not know what hit them, as factories closed down or relocated to countries with cheaper labour. The new jobs that are being created usually require skills that they do not possess and are invariably filled by younger, better educated workers or foreign talent. The Ministry of Manpower should therefore develop a national manpower planning framework that can quickly anticipate and identify key manpower trends in this fast changing environment, and also ways to get this vital information effectively and in a timely manner to our workforce, so that informed decisions can be made on the type of training and upgrading courses that workers should undertake in order to enhance their employability. I understand that the National Manpower Council had its inaugural meeting just last month. Could the Minister tell us whether the Council has made any projections and recommendations? Could the Minister also inform the House what initiatives and strategies his Ministry has taken with regard to manpower development in the face of this fast changing economic landscape? While it is well and good to study trends and anticipate changes in the labour market and advocate relevant skills upgrading, we should also be realistic enough to realise that there are many in our workforce, especially older, less educated workers, who may not be able to upgrade due to lack of literacy and numeracy skills and therefore are unable to benefit from the skills redevelopment programmes. Could the Minister tell us what measures his Ministry would take with regard to professionalisation of certain industries and occupations, and the redeployment of such workers, so that they too can have dignified employment, earn decent wages and be made to feel that every Singaporean indeed matters? Finally, Sir, with regard to the management of foreign manpower, Singapore needs to augment its indigenous workforce with foreign manpower for our continued economic progress. In many areas such as financial services, IT, communications and leading-edge manufacturing technology, there may not be enough Singaporeans yet and there may never be enough Singaporeans with the required skills to compete in the global market against the most advanced countries and emerge as winners. Singaporeans must accept the fact that we need a healthy infusion of foreign talent to raise our competitiveness and to create more job opportunities for Singaporeans. In fact, there is now a global war for talent and Singapore may be left far behind if we are unable to attract our share of international talent. Even in the field of sports such as football and table tennis, clear examples can be seen on how the infusion of foreign talent raises standards and competitiveness, and also how countries around the world scramble for such talents. Could the Minister tell us what measures his Ministry is taking to attract more foreign talent into the country, and whether the figures indicate that these measures are indeed effective? Lower down the scale, there are also many areas of employment that there are just not enough Singaporeans who seem inclined to undertake. Consequently, we now have large numbers of less skilled foreign manpower in occupations such as construction and cleansing services that Singaporeans seem unwilling to do. With such large numbers of low wage and low skilled workers available, there is little motivation for employers to raise productivity and professionalise such occupations. Wages in these occupations would also remain depressed and continue to remain unattractive to Singaporeans. Could the Minister tell us what measures are being taken to reduce the number of unskilled foreign workers in Singapore and also what incentives are being provided to ensure that employers bring in better skilled workers, and indeed if these measures are effective?

Sir, during the last recession, our unions and workers were praised for taking a cooperative posture in contributing to cost cutting measures to revive the economy. Looking ahead, the challenges ahead are going to be even more difficult. The twin forces of globalisation and technological changes are creating changes and uncertainties at an incredible speed. We need to strengthen tripartism to better manage the uncertainties of the future and to make all the stakeholders in Singapore winners. Tripartism can only work well if there is strong bipartite relations at the lowest working level in our factories, offices and workshops between managers, supervisors, workers and trade union leaders. Industrial relations is like friendship between people. Going through a crisis can result in two possible outcomes. Firstly, the shared experience could result in better bonding and better relations. This in turn can make it easier to work together and overcome future difficulties. The other possibility is that friendship suffers when one party feels taken advantage of by the other. We all know of individuals who are nice to us when they need us, and ignore us or even be unkind to us when they do not need us. If good relations suffer, we know it is very difficult to rebuild them. Singapore cannot afford to have confrontational industrial relations. Relations at the top level between the Singapore National Employers' Federation, the Ministry of Manpower and NTUC are generally good, but bipartite relations at the workplace generally need more improvement. There is a gap. I hear of cases where employers are being unreasonable or taking the union for granted. For example, they are asking workers to take pay cuts even when the company is doing well. Retrenchment exercises are done without regard to the human factors and its impact on workers and their families. Union leaders are being picked on, just to name a few. It is unnecessary to have these problems. While unions put people first, yet union leaders know that without commercial success we cannot promote the well-being of people. Businesses also must realise that they can do better if they can motivate the people who work for them. Fear of losing one's job is not an effective long-term motivational tool. The best tool to motivate people is to show genuine care and concern. Then business decisions will have to be more than just economic decisions. It has to take into account people factors and be adjusted accordingly. I have a few suggestions. The Manpower 21 has made some very good points on strengthening relations and promoting good human resource practices. I would like to ask the Minister to give top priority to its implementation. The key players in industrial relations are union leaders and HR practitioners. We need to upgrade their level of professionalism. They have to conduct industrial relations with openness, honesty and, of course, integrity. While unions spend a lot of resources in training and developing union leaders, the quality of our HR professionals varies very widely. I suggest the Ministry work closely with the Singapore Human Resource Institute to train and maybe even certify HR practitioners to ensure a higher level of professionalism. Next, the Government, as the biggest employer, can set the example. It will have to involve, consult and recognise union leaders. I also hope that the Government will ratify the core ILO conventions as in the Declaration of Fundamental Principles and Rights of Workers as soon as possible. It will help our image and increase the social consciousness of our business. We do not have blatant and unfair work practices in this country, but without ratifying it, it creates a kind of impression in the international community. Next, I hope that the Trade Unions Act will be amended to allow trade unions to represent more categories of workers. I mentioned this in the debate on the amendments to the Trade Unions Act. I also hope the Act will allow unions to buy shares of companies where they have members. Some of these companies may not be trustee stock companies. Some of them may be listed in foreign stock markets. This will mean allowing unions to buy shares of foreign companies and I think this will also help to bring about a link between employers and workers. Finally, I think we cannot succeed without the wholehearted support of the business leaders at the top of our business community. And I hope the political leadership will do more to sell the benefits of tripartism.

Sir, the 10% CPF cut was made on 1st January last year in an environment of economic and regional recession. Since then, there has been a sharp rebound in the regional economies, and the Singapore economy has emerged well placed for expansion in the next few years. A 2% restoration will be made on 1st April this year. However, many companies are well able and some may even be willing to restore the 10% cut at a faster rate than that announced by the Government. Is there any reason why the Ministry of Manpower should not permit a faster restoration of the employer's CPF contribution by companies that are able and willing to make such restorations? And will the Ministry consider granting such restorations the usual income tax exemptions?

Sir, the main social security safety net for Singaporeans is the Central Provident Fund. It provides for our old age, medical, education of children, home ownership, investments. And the question asked, is CPF really adequate to meet all these needs? Apparently, going by newspaper reports, it may not be adequate because a large amount of CPF contributions has been used by workers for home ownership. While it is right, I support the use of CPF for home ownership but, unfortunately, the prices of houses are going up faster than the wage rises, and more of the CPF is being used up. The second thing is that there is an income ceiling of $6,000 on CPF contributions and this has not been raised since 1985. Moreover, the liberalisation in investments of CPF holdings has meant quite a number of people have lost money on the stock market. I want to suggest some points to ensure that we have enough money needs to carry through in CPF and other means to our old age. First, I agree completely with Mr Charles Chong that we should restore the CPF cut as soon as possible. We do not have to wait for five years. The Government did a good example by not waiting till next year but restoring it this year. Keep up the good work and do even much faster. The second thing is that we should never ever use CPF as a tool for cost reduction. In the 1985 recession, CPF was used and the Government said that it was very painful. The reason the CPF was used was because the wage system was inflexible. So a flexible wage system was promoted. In 1998, CPF was again cut because many firms had not introduced a flexible wage system, especially in the private sector. In the private sector, for categories of executives and managerial people, practically no flexible wage system exists. So we should promote the flexible wage system and now, base-up wage system, so that we do not have to have the painful CPF cut, which actually affects people at the lower level of income more painfully than people at the top. These are people who need CPF savings most. 2.30 pm Thirdly, I suggest that we lift the income ceiling of $6,000 for CPF contribution. Fourthly, increase their income through education and training. If we can use CPF for investments in the stock market, we should also allow people to use CPF for investments in increasing human capital. Therefore, they can use it for training and educational purposes. We heard from the Ministry of Trade and Industry that they want consumers to have choice. Give workers choice. Give workers some money into their CPF accounts and let them decide which training courses they want to take which are useful for them. Fifthly, allow the employers to have some tax incentive benefits to contribute to the SRS which the Minister for Finance has announced. The SRS could be a supplementary income for old age, and let employers contribute. Finally, tax allowance for savings in excess of CPF. The most they get is for CPF allowance and people who save in insurance do not get any advantage. Can the Minister look for supplementary provision retirement which could be through employers and companies like insurance companies, banks and cooperative societies? Therefore, in that way, they will have CPF plus private means to give them income for old age.

Sir, I am speaking to reinforce the point which Mr Thomas just made on the usage of CPF for education. There have been strong arguments both for and against opening up the use of CPF funds for educational purposes. While it is laudable that the Government has set aside funds for training and skills redevelopment, this does not extend sufficient flexibility to employees and workers to freely choose the new skills or courses they would like to pursue. Also, in the case of parents wanting to use their CPF funds for their children's education, CPF funds usage is permissible only for courses at our local universities. However, quite a large number of students do not qualify for admission into the National University of Singapore or the Nanyang Technological University. Sir, in an age where a first degree is quickly becoming the norm for entry level jobs, parents whose children do not qualify for local university admission are forced to admit their children into foreign universities which, in most cases, cost much more. The denial of CPF funds usage means that the education has to be financed from savings or the parents have to work doubly hard to raise the money for their children's overseas education. Sir, this imposes undue strain on the family as parents have to work overtime or hold two jobs to pay overseas tuition fees and lodging costs for their children. In a KBE environment where all Singaporeans are encouraged to pursue life-long learning to remain relevant and employable in a fast changing business environment, our people should be given maximum flexibility to various sources of funds, including those statutorily held on their behalf. After all, pursuit of life-long learning is a worthwhile investment to keep them relevant with the needs of the economy. Sir, beyond tertiary education in Singapore's institutions of higher learning, I would like to propose that CPF funds usage be selectively permitted at least for accredited courses of study, both local as well as foreign. The Ministry of Manpower in conjunction with the Ministry of Education could perhaps issue some guidelines on the types of accredited courses permitted.

Female workers form about half of our population. They also make up more than 40% of our workforce. They are a very important part of our society. They enjoy equal pay as men for the same job done. They enjoy tax rebates that are extended to men. There are many women who are working and are not classified as economically active. They play a very important role at home in keeping the family together, in taking care of the children, in keeping them cope with the school work. While all those who work would enjoy CPF savings for their retirement and old age, our home makers, while working women like working males benefit from Government CPF top-up from time to time, non-working wives do not. Considering the important role of the home makers, I would like to urge the Ministry to extend the planned Supplementary Retirement Scheme (SRS) to the working wives or spouses by allowing the husbands to contribute to the CPF savings account. We can start this with women who already have CPF accounts but who stopped working to take care of their families. But in future the scheme should be open to all working non-spouses. In order to encourage such savings, it is important that the relevant tax incentives be offered to them. When we have budget surpluses, the Government should top up the SRS account of the non-working spouses. The SRS is particularly for workers in the lower income so that they can boost their savings for old age. Unfortunately, as shown by the experience of the USA in regard to the optional 401K savings scheme, the lower income workers are less likely to contribute to the SRS. To start with, they have less money to set aside as savings, and they would benefit less from the proposed tax nature of the SRS. After all, 70% of our wage earners do not pay income tax. That is why I propose that the SRS should offer good incentives to encourage the lower income workers to save for their own and their spouses' old age and retirement. One possible way to encourage them to save up through this CPF-based scheme is by the Government topping up the SRS accounts when there are budget surpluses. Of course, to start with, good tax incentives should be offered.

The Member before me, Mr Hawazi Daipi, argued very eloquently for the extension of SRS to spouses. In the previous day, Mr Seng Han Thong has also asked for the same thing. I would like to also add my voice to this. In addition to the contribution that working spouses make to the well being of the family, this particular group is vulnerable because the women are the ones who live longer and will form the largest portion of the elderly population. The Report of the Inter-Ministerial Committee on Ageing Population had registered we were greatly concerned that many CPF account holders would have inadequate balances on retirement. This particular group which is most vulnerable is in fact also the group that will not have any CPF balances. I support the proposal put forward by Mr Hawazi Daipi and Mr Seng Han Thong. I would in fact like to take one step further to suggest, over and above the favourable tax treatment, a voluntary contribution to the CPF account of their wives. We should consider making it mandatory that in the case where one spouse is not working in a salaried job but is a full time housemaker, a portion of the CPF contribution of the salary of the spouse must be channelled into a CPF account of the homemaker so that the latter is not totally dependent on the goodwill and indeed the prudence of the wage earner to have some funds available to see her through in her old age.

Sir, thank you for allowing me to respond to the hon. Members who have just spoken. First, I would like to respond to Mr Charles Chong who spoke about the need to have a national manpower planning framework to quickly anticipate and identify key manpower trends in a fast changing environment. I am in full agreement with Mr Chong that we need to have such a manpower planning framework. This is in fact one of the recommendations of the Manpower 21 study, namely, to set up a National Manpower Council in order to conduct an integrated holistic approach towards manpower planning for Singapore. Sir, as our economy transits into a knowledge based economy, effective manpower planning will be crucial to help us to meet the challenges of rapid changes as well as to ride the new wave of opportunities. Sir, a manpower planning framework with the Manpower Council at the helm will enable us to better anticipate manpower needs and to facilitate a better fit between manpower demand and supply. It will also enable us to address the manpower issues in a holistic manner. The end objective is, of course, to enhance the competitiveness of our workforce in the knowledge-based economy. 2.45 pm Sir, I am pleased to report that the National Manpower Council had held its inaugural meeting last month. I would like to take this opportunity to inform the House on some of the key issues which were discussed and the strategies which were endorsed by the National Manpower Council. First, on the area of manpower demand. With the economic recovery well underway, job creation is expected to be positive in the medium term, with a projected average net job creation of about 45,000 jobs per annum between the years 2000 and 2005. This will be much lower than the pre-crisis year. 45,000 jobs a year might sound a lot, but, in fact, it is much lower than what we were doing in the years before the financial crisis. Between 1992 and 1997, for example, we saw employment gain of about 83,000 per year. In the next five years, the sectors with the fastest job growth per annum include business services (about 8,800 per annum), financial inter-mediation (5,900), computer-related activities (4,007), transport and logistics (4,000), education (2,008), health care (2,300), wholesale trade (1,900) and petroleum and chemical (1,400). Sir, these projections, I have to emphasise, are based on the economy growing steadily at an average of 5% per annum and also based on what we know of the investment trends and the business opportunities or business forecasts in the short term. What is important is not so much the actual projected number, but the projected changes in demand between different sectors of the economy. The projections show that the service sector and the IT-related will lead in job creation. In the manufacturing sector, the turnover of lower value-added jobs to be replaced by higher value-added jobs will continue. EDB's Industry 21 plan is on target to generate about 15,000 jobs per annum, two-thirds of which will require fairly highly skilled workers. New jobs in the electronic, chemical and life sciences industry will be created. At the same time, job losses are expected from restructuring of the light manufacturing and electronic industries. Employment growth in the service sector will be underpinned by the rapid growth of Internet and e-commerce activities across various industries, including finance, business and education and the growth of new activities in logistics, communication and IT. Sir, in line with the move towards more knowledge-based activities, the demand for manpower will be greater for the highest skilled and education category. Manpower demand is projected to grow for those with degree, diploma and post-secondary qualifications, while the job demand for workers with secondary and below education will continue to drop. In general, a greater proportion of highly-skilled manpower will be needed across all industries. In terms of manpower demand by occupations - professional, associated professional and managers - will emerge as the fastest growing occupations in the industries such as business, computer and related activities, finance, engineering, electronics and communication. Sir, to meet these emerging manpower needs, various strategies encompassing manpower development, manpower augmentation and industry re-engineering will be needed. First, on retraining the workforce, the Skills Redevelopment Programme and the Strategic Manpower Conversion Programme have been formulated to provide skills training and conversion to help workers move from one industry to another. The National Manpower Council has identified additional areas that could be considered for SRP and the SMCP. For instance, workers within electronics, electrical, retail and construction industries can be upgraded through the SRP to take on higher skilled jobs within these industries. Training and conversion programmes could also be offered to enable workers to be deployed to other industries with growing demand for workers. Workers in engineering, light manufacturing, finance and construction, for example, can be deployed to appropriate jobs in IT, health care and the transport and logistics sectors. Sir, in line with the anticipated growth in manpower needs for specific disciplines, the National Manpower Council also set new targets for university and polytechnic intakes. For example, the universities will expand the intake of engineering and computer science by about 4% from last year's intake. Other disciplines with significant increases to cope with anticipated demand could be seen in pharmacy (about 8% increase) and communication studies (about 9% increase). Polytechnics will increase engineering intake by about 2% and 12% for computing. The polytechnics will aim for higher intake for media and design studies of about 14%, and for health-related subjects, about 9%. In the case of business studies, the intake will go up by a very significant 14%, with SMU taking a share of the increase. In the other disciplines, the intakes will be maintained more or less. In addition, in a knowledge-based economy, when knowledge creation could come from the convergence of various disciplines, it is recommended that the post-secondary educational institutions adopt a more multi-disciplinary approach. For example, core skills such as IT and communication should be included as modules in all disciplines of studies. This approach will provide younger Singaporeans with multiple skills and capability for a wider range of jobs. To achieve the desired educational profile for the workforce of 25% degree, 20% diploma, and 20% post-secondary workers in 10 to 15 years' time and to ensure that workers, especially those at risk of structural unemployment, can be trained and deployed to emerging industries quickly, the National Manpower Council strongly endorses the Manpower 21 programmes to enhance in-employment, education and training. Under this system, we will optimise the use of current educational infrastructure to expand the capacity for continuing education and training. My Ministry will work closely with Ministry of Education to look into the funding arrangements for specific programmes and the means to optimise the current infrastructure to provide this CET needs, for example, through the provision of more part-time and evening classes. Another strategy is to re-engineer jobs and industries which are low value-added and are labour-intensive. The objectives are to improve productivity, reduce manpower demand and raise the image of the industry to encourage more locals to enter such occupation. This is especially important given that there are many in our workforce, especially of the older age group, who may not have the basic literacy, numeracy and language skills to benefit from the Skills Redevelopment or Conversion Programmes. Through these strategies, Sir, we hope some of the structurally unemployed will be able to fill the manpower gaps in the domestic service-based industries and be meaningfully employed. This strategy has been initiated in the cleaning and construction industries. The National Manpower Council has identified other areas in health care, hotel and restaurant and retail sectors. Sir, in augmenting manpower supply, there is a need to augment the local manpower supply. That is quite obvious. In many areas, we have jobs where we do not have sufficient Singaporeans to take these jobs or we do not have Singaporeans with the required expertise and experience to take on these jobs. That is why we need to augment our manpower supply. But, first of all, in terms of augmenting or increasing our manpower supply, we must also look at our own domestic population, our own workforce. For instance, if we can increase the female labour force participation rate by, say, 3 percentage points, we will be able to draw about 40,000 women, who are now economically inactive, back into the workforce. So just a 3 percentage point improvement in our female labour force participation rate amounts to 40,000 additional or new workers to the workforce. This is a significant area for us to look into, if we are talking about augmenting our manpower resources. But even after we try to draw the economically inactive women into the labour force, we will find that there are still gaps in the manpower demand and supply which the local workforce will not be able to fill, as I said earlier on, perhaps where Singaporeans do not have the experience or the expertise or where there are just simply not enough of Singaporeans to go around. Consequently, we will need to supplement our local workforce with foreign manpower. We must continue to leverage on the global manpower resources at all levels in order to bring about sustainable economic growth. We expect the shortage in professionals and technicians as well as production workers and manual workers to persist for some time to come. Foreign manpower is therefore needed to plug these gaps, especially at the higher end, where we continue to attract foreign talent. At the lower end, we will continue to admit foreign workers selectively. So the thrust is to raise the skills profile and the productivity of lower-end foreign manpower as well as to professionalise the lower-skilled jobs, so that we can reduce our reliance on low or unskilled foreign workers. Sir, all these strategies will help us to build a globally competitive workforce to meet the economy's needs as we transit into a knowledge-based economy. My Ministry will work closely with our various partners and implementing agencies on these strategies and programmes. Mr Chong also raised questions on manpower development and on foreign workers. There are cuts later on in the debate on this. Either my Minister of State or I will be responding to those other points. Let me now move on to Mr Thomas Thomas' point on the importance of tripartism. Here, again, I agree completely with Mr Thomas on the importance of tripartism. It has been, I would say, a cornerstone of our economic well-being. The strong tripartite cooperative, non-confrontational relationship has helped us tremendously and is, indeed, an asset. Mr Thomas suggested that we give top priority to the M21 recommendation to upgrade the human resource practitioners. Yes, we will do that. We will work closely with various human resource institutes. In fact, my Ministry has set up a unit to promote a HR promotion unit where we will study the companies which have developed or implemented good HR practices. We will use these as case studies and we will then promote these practices to other employers by way of seminars or workshops, so that employers and HR practitioners can learn about what other companies are doing by way of improving their HR management practices. Mr Thomas also suggested that the Government as an employer should contribute to building up tripartite relationship, consulting the unions whenever there is a need. Let me assure him that that is our approach. I know that the Public Service Division does consult the unions on key issues, whether it is NWC wage increases or any other matters that would affect the public sector employees. He mentioned in passing about ratifying ILO conventions. Let me point out that there is a cut later on and we will give him a full reply on our approach towards ILO conventions. But at this juncture, suffice to say that when ILO convention does not run counter to our national interest, we are very open and we are ready to ratify such conventions. Mr Thomas also suggested that the Trade Unions Act be amended to enable unions to represent a wider category of workers. As it stands today, any employee who has a contract or service with an employer, in other words, there is an employer-employee relationship, he is already entitled to join the union, regardless of whether the worker is a part-time worker, a casual worker or hired on a contract. As long as there is a real employer-employee relationship, the worker can join a union. The group that is excluded, in fact, is only the self-employed workers. In the past, prior to 1982, even self-employed could join the trade unions. But then it was noted that obviously being self-employed, there was no employer-employee relationship, and the group or the union that represents these self-employed workers could not negotiate or could not have collective bargaining with the employer because there was no real employer-employee relationship on which they could base their collective bargaining on. And also such self-employed workers - even if they joined the union, before the 1982 amendment to the Trade Unions Act - found that they could not avail themselves of the conciliation or the industrial arbitration process within the ambit of our labour legislation. So, in fact, there was no advantage for them to become union members in this sense. 3.00 pm Having said that, there are some vocations which generally are considered as self-employed but, in fact, there may be specific instances where they are actually employees. For instance, many musicians are considered self-employed and they are not members of a union. But musicians of the Singapore Symphony Orchestra, for instance, are actually employees of the Singapore Symphony Orchestra Limited and therefore they are eligible to join a union. There, again, it is not a question of what you do. It is a question of whether there is an actual employer-employee relationship. Mr Thomas also suggested that unions should be allowed to buy shares of their own companies, including foreign-based companies. This is an area that we have to study carefully. Presently, unions can invest their funds in trustee shares. They can invest in land, they can also invest in land overseas, although that will require a different procedure to get approval from the members. But whether they should buy overseas shares and also foreign denomination shares, it is something that we should study. We should not rush into it. Of course, as Mr Thomas would agree, the risks of buying overseas shares with foreign denomination are much greater than buying Singapore dollar denominated shares. Sir, I next turn to Mr Charles Chong's query on some companies which are able and may be willing to restore the 10% CPF cut faster than announced by the Government. Let me say that the CPF cut that we introduced on 1st January 1999 had enabled many companies to become more cost competitive. Companies, which were facing severe difficulties during the financial crisis and economic downturn, could, in fact, have fallen by the wayside, but ended up with a second chance as a result of our CPF reduction and other cost reduction measures. Many have in fact survived and are well on their way back towards a growth path again. Companies that were doing well during the crisis and economic downturn also benefited from the cut in CPF because they then found themselves to be even more competitive than they were before. They could gain a bigger market share. So what happens is that when you cut the CPF across the board, you benefit everybody because those companies that are not doing well, we help them to survive. Those companies that are already doing well, they are able to increase their market share and, in the process, even create more jobs. So we both preserve jobs and also create more jobs. If we were to allow companies which are able to make quicker restoration of the CPF on their own and also give them the full tax benefit, then we are going to lead to a situation of invidious comparison between companies. Employees who want to compare may say, "Why is this company able to make the restoration faster, although voluntarily, as compared to mine?" That would remove this sense of collective burden sharing that was so important in how we rallied Singaporeans together to face the crisis in 1998. It could lead to a situation where employers, including the less profitable ones, could be pressured to make voluntary contribution. Having said that, I do not think companies that are doing well should just enjoy the CPF cut and reflect it as an additional surplus or profit to be enjoyed by shareholders, who are owners of the company. There is a case here for companies that are doing well to also reward their workers by either wage increase, if they think that their good prospect is sustainable, or by one-off special bonuses, at the end of the year, if they are not too sure whether the good performance will continue or not. In fact, this was recommended by the NWC in October 1998 to account for the differences that if you are doing well, the companies should reward workers with special bonuses, rather than go back to the old CPF mechanism. As far as the Government is concerned, we will restore the CPF cut, and this is a point which was also brought up by Mr Thomas. We will restore the CPF cut at a pace which will not hurt the economic recovery and growth. The first step is the 2% restoration on 1st April this year. We will speed up the restoration if there is clear evidence that a faster pace of restoration will not hurt our overall competitiveness. Mr Thomas next went on to suggest that the CPF should not be used as a tool for cost reduction. I agree with him. We should not treat the CPF as a means of adjusting our wage cost at the slightest provocation. We should look at the CPF as a last resort. Only if there is no other way of preserving our competitiveness should we then touch the CPF. This has always been my position even in 1998, when we were first discussing the CPF cut. Because whenever you cut the CPF, it will affect people in a whole range of ways, some of which are quite unanticipated. So we should always treat it as a last resort measure. I agree with him that we should use the flexible wage system as the first mechanism to adjust our wage competitiveness. In this regard, we should get all our employers to sit up and take a more proactive stand with regard to the recommendations by the NWC to institute a monthly variable payment. A monthly variable payment, which is in a way bringing part of the end-of-the-year bonuses into a monthly payment, will help employers to cope with sudden changes in the business environment. They do not have to wait till the end of the year to adjust the bonuses in order to reduce their labour costs. They could in fact adjust the monthly variable payment whenever business takes a sudden turn for the worse. This is an area that all employers should sit up and take notice of, and try to implement as soon as possible. He also suggested that we should review the CPF contribution ceiling because, presently, no CPF is contributed for salary above $6,000. The $6,000 was fixed in 1985. We have looked at this possibility. But we should be careful about raising the CPF contribution ceiling. Because if you do that, you are increasing the cost burden to the employers. And at this juncture, while the economy has recovered, we cannot be sure that the recovery will be smooth and uneventful. We do not want to over burden the industry with additional cost factor. So we should be very careful about adjusting the CPF ceiling. On the contrary, we do want Singaporeans to also save more for their retirement which is why the Minister for Finance announced the Supplementary Retirement Scheme. The scheme will enable those who want to save more and also have a tax incentive to save, to put aside more of their income into the Supplementary Retirement Scheme, ie, open a SRS account and put aside additional savings for their old age. As to the details of the scheme, the Minister for Finance has explained that he will study it in greater detail because there is a wider tax implication. We will seek feedback from various sectors and if Members have any comments, we will be prepared to consider, particularly, whether employers should contribute to the SRS by way of incentives so that they will put in their co-contribution together with the employees. This is something we can look into. His other point was that we should consider additional tax allowance for employees or workers who have made other investments, such as by way of insurance policies. This is an area that had been studied before. Under our arrangements, all mandatory CPF contributions are tax exempt. You can buy insurance and claim tax exemption on the premium that you have paid, provided the total amount does not exceed the mandatory CPF contribution. I am not sure whether we should at this juncture change the tax ruling. But this is a matter for the Minister for Finance to consider. Next, I would like to respond to Mr Ahmad Magad, Mr Ang Mong Seng and also Mr Thomas. Both Mr Magad and Mr Ang Mong Seng raised the concern about using CPF for self-improvement courses, part-time courses and overseas education for their children. This is not a new subject. It has been raised on many occasions in this Chamber and we have discussed this extensively. Let us go back to the objectives of the CPF. What is the CPF's core objective? It is to help the member to save sufficient money for his retirement needs. We have allowed one deviation from this and, that is, to allow him to borrow against his CPF savings to finance his children's full-time education in a Singapore institution. We also have allowed the CPF member to borrow against his own account if he himself wants to undertake a full-time course in a Singapore institution. This was in order to allow lower income Singaporeans who have difficulties supporting their children to study full-time at the local tertiary institutions. We are comfortable with doing that because tertiary education in Singapore is highly subsidised, and the fees are in fact regulated and controlled by the Government. On the other hand, for self-improvement courses, the fees are charged at the market rate. Overseas education is very costly. Even if we say yes, you can borrow against your CPF account to finance your children's overseas education, there would have to be a limit obviously. You could not say you could take everything out of your CPF account and spend it on your children's overseas education. What would be the limit? The limit naturally must be what you can withdraw if your children were studying in Singapore. If you do that, then you will find that the portion that you can borrow from your CPF account to finance your children's overseas education is a very small part of the total cost of financing the education overseas. In which case, you would therefore run a greater risk of losing that investment if, somewhere along the line, the parent loses his job or has to take a cut in the income, and he can no longer support his kid overseas. That is why we are concerned that if we open up this area, we will allow greater erosion of CPF savings. Of course, when you buy shares, there are risks. We know that there are risks associated with buying shares. But at the end of the day, those members who make prudent investments, in the long run, will certainly enhance their CPF savings. There are many studies to show that, over the long run, equity investments generate significantly higher rates of return than just putting money in the bank. There may be ups and downs in between, but if you are prepared to hold those investments over the long run and if they are wisely invested, if you make a careful study or, better still, allow professionals to help you make the investment, then you will find that, over the long run, you are unlikely to lose out. That is why we are prepared to allow CPF members to use their CPF savings to invest in shares. Whereas investing in overseas education is a totally different thing. Investing in overseas education is not just paying the fees. It means supporting the student during the period of stay and that can be quite costly. The fees can be tens of thousands of dollars compared to what is being charged by NUS. That is why we are quite concerned and we are not prepared, at this juncture, to relax the ruling that CPF savings can only be used for education if the person using it is studying in a Singapore institution on a full-time basis. 3.15 pm Mr Thomas suggested, if I get him right, that the Government should consider transferring some of the surplus to top-up CPF members' accounts and allow them to use it as some sort of training fund. This is a different presentation from what was raised sometime ago about allowing CPF members to use part of their CPF savings for training. If it is in fact to ask whether the Government would make this CPF top-up available for CPF members to pay for some training expenses, that is a totally different proposition and it is something for the Minister for Finance to consider and see whether this should be the way to give out some of the budget surplus or not. Let me say that today we are not facing a shortage of funding in order to support workers' upgrading or retraining. In fact, skills upgrading or retraining is well within the reach of every worker today. Let me point out an example. Last year, we had a training commitment of 18,200 workers for the Skills Redevelopment Programme. 18,200 workers signed up for the Skills Redevelopment Programme. In fact, only 12,600 or about 70% actually turned up for the training. The rest never showed up. In fact, the SRP budget that we have is grossly underspent. We have the funds, the training capacity, but the workers have not turned up. The issue that confronts us today is not a lack of funds. It is a sense of complacency, a lack of urgency on the part of employers and their employees. I think the economic recovery has made it even worse. The employers do not feel the urgency. They see a pick-up in business and prefer to keep their workers on the job or even to work overtime. Investment in training for their employees is now seen as less important. On the other hand, workers who see that his job prospects are much better, see little need for training as the threat of retrenchment seems to be over. Let me say that individuals should take responsibility for their training, career and learning needs and they should make full use of the extensive support and financing mechanism that we have instituted in order to upgrade their skills so that they can remain employable even as the job market continues to change. Lastly, I would like to respond to Mr Hawazi Daipi and Dr Jennifer Lee. I also agree with Mr Hawazi that housewives contributed immensely to the family and to the national development of the country. I do not think this is ever debated or anyone would argue against this point. Even though they are not actively working or contributing in the economy, the housewives, by looking after the children and the homes are making an enormous contribution. In fact, we do provide incentives for spouses and children to build up or to contribute to CPF accounts for the housewives or homemakers. Children of the homemakers can make contributions to their parents' or their mother's CPF account under the existing Minimum Sum top-up scheme. The children would be allowed a tax relief on the cash amount contributed into their non-working mother's CPF account up to $6,000 a year. Spouses of homemakers can also top up their wife's CPF account with CPF savings under the Minimum Sum top-up scheme provided they themselves have double the Minimum Sum amount. We also have other incentives for children or spouse to make contributions for homemakers in the form of CPF share ownership top-up scheme. This was done in 1993, 1995 and again in 1997 and we also have the CPF top-up scheme in 1995 and the Medisave top-up scheme in 1996 and 1997. In some of these top-up schemes, the children or the spouses were required to make a co-payment before Government would credit a certain amount of top-up into the homemakers' CPF accounts. It is not quite correct to say that homemakers cannot take advantage of various Government CPF top-ups. In fact, they did in the past. In the recent top-up announced by the Minister for Finance in his Budget speech, Government is going to give a special top-up of $250 into the Ordinary Accounts of every Singaporean CPF member aged 21 and above, provided they have made at least one contribution for the whole of 1998 and 1999. The objective of this top-up is in fact to recognise Singaporeans who have accepted the wage and CPF cuts as part of the package to deal with the economic crisis. In fact, homemakers who had made at least one CPF contribution during this same period, either by their children or spouse, will also be able to receive this $250 top-up from the Government. Sir, I believe I have addressed all the points that were raised.

Order. I propose to take the suspension now. Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the House.

Order. I suspend the Sitting and will take the Chair again at 3.45 pm. Sitting accordingly suspended at 3.21 pm until 3.45 pm. Sitting resumed at 3.45 pm

Debate in Committee of Supply resumed.

Head T (cont.) -

(In Mandarin): Sir, the downfall of communism, the opening up of many countries in the region and in the world to trade and foreign investment, and recently the advent of the Internet, all have an impact on the Singapore economy. The Internet, especially, has speeded up the development towards a global economy as it becomes possible to communicate with anyone in the world and at any time with the click of a mouse. To deal with the challenges posed by emerging economies, like China and Thailand, we have begun to move away from low-cost manufacturing where we have become less competitive to high value-added industries where we are in a better position to compete. In the process, many of our workers from these low-cost operations have been retrenched. We need to re-train them for jobs that new high value-added investments are bringing in. But while our intentions are good, not many workers seem prepared to go along with it. Workers have cited many reasons: working place is too far, shift work, pay is too low, employers want younger workers, having to re-learn and so on. Whatever the reasons, I feel that there is a need for re-training to begin as early as possible, not at the stage when workers have been retrenched, or about to be retrenched. Maybe this will make the transition easier. Workers will feel more confident about taking on new jobs because they already have some basic knowledge of the technology acquired some time back. Is there a way to identify industries where re-training can be intensively pursued? It is said that employers who can rely on foreign workers also tend to be the ones who do not want to hire older Singaporean workers. Perhaps some incentives can be given to them to encourage them to do so. As for the Internet, its actual impact is still unknown. In the past two years, we saw a lot of developments . New Internet start-ups, retailers going online. Big players merging to become even bigger - all clamouring to position themselves for a share of the Internet market. As companies deal directly with customers on the Internet, there is talk that the middlemen may be sidelined. What is the impact on the small businessmen in Singapore? What is the impact on the Singapore worker? There is a need to prepare ourselves for the onslaught. New IT training, new and innovative marketing strategies. Net technology is still developing. What you learn today may be superseded by advancements tomorrow. Just take an example. HTML (Hypertext markup language) that the Internet depends on initially is now no longer enough. You have new developments like Javascript, Vbscript and so on. How soon can training institutes catch up with and impart the skills to our workers? Sir, these are issues that the new Manpower 21 Committee should address.

Sir, much has been said about the impact of globalisation on our employment prospects for our workers, and the need for training and retraining our workers in order for them to stay employable. I applaud the Minister for his Ministry's M21 Report and the strategy to help meet the demand sectors in manpower resource. My concern here is trying to convert a significant portion of the workforce with a certain level and set of skills into a higher one. While this is laudable, it may be limited for many of our workers, because the pace of change of industries and the knowledge economy is taking place at such a fast pace that even well trained people from the polytechnics and the universities may find it hard to cope. Such workers, however, may learn another less onerous skill and seek employment in another sector. One of the interesting features of the new economy is to be found in the United States in the growth of employment in the traditional services sector in the face of employment decline in the traditional production sectors. Even in the new economy, people need to be served. They need to go to restaurants. They need to enjoy music, having things delivered to them, cleaning and maintenance work, etc. Our workers, young and old, need to be equipped with, for want of a better word, I would call, a skill multiplier, and that is to be able to use the computer and the Internet for communications. I am not even talking about information technology..This familiarity and skill will equip them well to bridge distances, to match the demand and needs for goods and services with the fulfillment of that need and to communicate with the customers. I would like to highlight here that the NTUC has done quite a lot in training and retraining more than 20,000 of such workers to acquire this kind of skill. And the recent initiative announced by the Government to train our more senior workers in learning this new skill is laudable. It can be a delivery service. It can be a restaurant service, the cleaning service, the hospitality service, a childcare service or retail service. The Ministry should therefore identify this kind of service sectors where we can upgrade or professionalise the work with the right kind of equipment to work with, so as to enable our displaced workers to stay employed. Unfortunately, the present situation in Singapore is that there are many foreign workers working in these sectors. The wage in these sectors is also low. Hence, I urge the Minister to focus on this issue and accelerate the development of services associated with high-tech affluence, so that there will be available jobs for our displaced workers in order to let them stay employable.

Sir, I had wanted to ask the Minister about the projected growth of jobs and the pattern of job growth, but the Minister had already informed the House about this. Let me just focus on retrenchment and unemployment. What are the projected unemployment rates in the coming years? Sir, in 1998, it was noted that among the less educated, there were more unemployed workers among the older group of people, whereas among those with tertiary education, it was noted that fewer older workers were unemployed but younger graduates were having difficulties in getting jobs. What was the situation last year when the economy turned around? And what would be the likely pattern in the coming years?

Sir, while companies should be primarily responsible for motivating their employees through the various incentive schemes, there still remains an issue of rampant job hopping among young Singaporeans. Despite the tough employment environment last year, many employers still faced serious problems in employees changing jobs over trivial reasons. This is especially so for our younger workers and those employed at the lower ranks in the companies, and especially too for those who work in shifts. Employers have been fortunate that the Government allows them to hire foreign workers to make up for the shortage of workers up to now. In many cases, employers have depended on the foreign workers to be their stable backbone to keep their operations going, while having to live with a much more volatile local workforce at those levels. Surely this is not the type of image we want for our workers in Singapore. Sir, the reason why I am bringing up this issue again is because I am concerned that even in the years when the job market was tough and when we had record retrenchments in the last few years and uncertainty of jobs and job security, our younger workers still did not take their employment seriously. I know that the Minister will push the issue back to the employers but, in the long term, the issue will become Singapore's competitive disadvantage, and it is a national problem and will need a national solution for this. Many of us have asked that the CPF be used as a tool to control job hopping, but the Minister has many times objected to this because the purpose of CPF is mainly for retirement savings. I can accept this argument. In its place, I suggest that we implement a national compulsory saving scheme or a fund where both employees and employers contribute some money to the employee's account and the money contributed to such accounts can be used for a number of purposes. For example, one way to motivate employee loyalty is to pay them a gratuity every five years or so of employment. The employee can also borrow from his or her own account in times of difficulty, like when a retrenchment comes, very much like what some insurance policies allow you to do where you can borrow from your policies when you need to. Such a fund can also be used to address a number of social and welfare issues, not possible with the CPF. In fact, many Members, just before the suspension, talked about the use of CPF for various things, including for education. From the employer's perspective, if an employee leaves the company within the first or second year of service, the company should be able to claim back part of its own portion that he contributed to the employee's account, to compensate for the cost of hiring and training. The employee's portion can remain in the fund for the employee to use in future for whatever uses. Sir, the Supplementary Retirement Scheme (SRS) is an excellent way to implement some of the things that I am suggesting. In fact, it is very timely that this scheme has come about. We can do many more things without touching the CPF. Furthermore, I would like to suggest, as we go about restoring the CPF savings rate in the next few years, we should take the opportunity to revamp the system and the quantum that goes into the CPF and the SRS. For example, in the long term, I would suggest that the CPF rates could be 15% contribution each from both the employer and employee and 5% each from the employer and employee to the SRS or an equivalent scheme. Sir, I hope that we will take this opportunity to address the issues that I have raised because these are national issues and not employer specific.

Sir, in Singapore's drive towards a knowledge-based economy, there will inevitably be structural unemployment. The Minister has charted the key directions just a while ago which is a long view and it is a laudable one. However, I think there are concrete steps to further help the current older and lesser educated workers who may not even know how to look for jobs in the classified advertisements of newspapers, much less through the Internet. I accessed the MOM's webpage and under the section of unemployment assistance for job seekers and employers, there were a total of 2,005 job seekers compared to 1,187 job vacancies posted by employers in December 1999. Compared to the national figure of unemployment, which was reported to be 79,900 last September, the capture rate by the web was dismal. That tells me that the web is not a very effective way in reaching job seekers. And if we look at the figures closely on the web, the occupational groups of cleaners, labourers and related workers are the largest group of job seekers. This means that there are more people than jobs available. On the other hand, the job vacancies for production craftsmen, machine operators, assemblers and related workers, there are more jobs than there are people wanting to fill them. As these two groups belong to the lower income group, I am concerned whether these trends reflected broadly the employment opportunities in our society. If so, then I would imagine that what MOM has to do is to train the excess cleaners and labourers to take up jobs as production craftsmen, machine operators, assemblers and related workers. Who would play this coordinating role? Is the mechanism being set up to track the people and companies on the web or is it merely a bulletin page for reference and people are left on their own to seek employment? 4.00 pm At a broader level, we know that the factories in Singapore hire an overwhelming number of workers from nearby township. In this respect, I think the CDC can play an important role to match their employment needs with the older lesser educated workers who find the CDCs less threatening than MOM's Employment Service Department. I was told that there were exhibition fairs and keen employers but those who needed jobs did not turn up. I think the following can be done by each of the nine CDCs. Hire one or several full time job placement officers who will actively liaise with employers within the CDC to counsel workers as to retraining opportunities as well as job opportunities and finally to play the very important human role of matching employer and employee for workers who are threatened and intimidated by a high-tech world. Over time, I could see the development of new jobs within the CDC for the role of a worker-manager who is linked up to multinational employment agency to identify new jobs and using a job database to facilitate the matching process. He or she could represent the job applicants to the companies to arrange for different work schedules by redesigning job programmes in such a way that benefit employers and workers. Sir, this is not an easy process, but a flexible and dynamic one which I believe can help in redesigning our job landscape for women workers who look for part-time or flexi-time work, older people who look for maybe just two to three hours of work to keep connected, for people with special needs like those who are wheelchair bound and so on. Sir, I believe there is a role for human beings to play this job matching function and I would urge the Government to provide adequate funds to each CDC so that this can be done efficiently. And I urge all the CDCs or Town Councils to provide the leadership in driving this. I would also recommend setting up a telephone Jobline in each CDC so that all nine CDCs are in close touch with their specific community needs. Unlike the National CDC Helpline, the CDC Jobline approach is localised, focused and efficient. The Mayors and the respective MPs and grassroots leaders are the best consultants for identifying job and people's needs. It is clearly revitalising a kampung gotong royong spirit. In all this talk about the new economy and job redesign, I have come across the 4Rs adopted by MOM - the redeployment of displaced workers, renewal of workforce, realignment of employment practices, revitalisation of employment recreation. These concepts, Sir, may be true and well at the broader national level. What I recommend may well be a concrete way to help bridge the gap between national strategies and the real dilemma of the older and less educated workforce.

Sir, Singaporeans face stress at work, stress in schools and stress at home. Stress at work arises on two fronts. Firstly, just keeping up with the pace of the new knowledge and new technologies; and secondly, concurrently managing the balance between these demands, and those of the home and family. It is on managing this work-family balance that I would like to speak. Essentially I am talking about promoting family friendly practices in our companies and workplaces. This effort must be a joint effort, not of Government alone, but very much involving the initiative and commitment of employers, and indeed of our human resource professionals as well. While there is a much greater awareness of the importance of helping employees manage this work-family balance in the US and Europe, locally however, very few of our companies have taken more than just rudimentary steps in the direction of being family friendly. Apart from the recognition that employees are more productive if they are able to balance their work and personal lives effectively, there are benefits of being able to retain skilled and experienced staff and these benefits are real and quantifiable. SNEF, together with MCD, MOM, and NTUC has already made a start in promoting family friendly practices among our local firms, in implementing a Family Friendly Award for companies in 1998. But SNEF can take the initiative of another step, by galvanising and recruiting enlightened employers, most obviously the past and future winners of the Award, to come together to share best practice and establish a self-help one-stop shop and support service, for employers to share information on work-family issues. Very often, it is not being sensitised, not having an awareness of the implications and also of the way we can address such issues. In doing this, we do not have to re-invent the wheel, but simply take the lead of organisations in other countries, for example, there is an "Employers for Work-Life Balance", an alliance of major companies in the UK, who have come together in exactly this cause. The alliance has an interesting and informative website, and provides information on case studies, and research and publications, including an employer manual on how to begin taking action on work-life issues, and another manual offering specific guidance to small businesses. We usually tend to think that the big boys can afford some of this but it is very hard for the smaller companies to look at family practices. The coming together of these major companies, which include the big banks, the accounting firms and the major retailers in the UK, just to name a few, endorses the business benefits of implementing family friendly practices, and it lends credibility and support to this enterprise. In addition, this alliance works in partnership with a long list of voluntary and community organisations. It is time for us to similarly energise into action in Singapore getting firms together with the human resource institute and see if we cannot just move ourselves at a little bit faster speed. I know we are doing something, but by the time we get there it will be two more generations of young Singaporeans having to struggle with this. I cannot complete without at least asking for something from Government. We would disappoint every Member in the House. Certainly Government can also help in this, over and above its role as an employer, of course. Firstly, the Productivity and Standards Board has just last month announced its new $50 million Work Redesign Programme to encourage companies to review and revamp the way they work so as to improve productivity. The projects approved for support under the programme should include work redesign to enable and facilitate family friendly flexible working patterns. Secondly, MOM could commission local cost-benefit analyses on family friendly practices to demonstrate to local companies that the experience of US and European companies, of tangible benefits to be had from implementing family friendly practices, holds true also for us. Thirdly, MOM could help in producing informational material such as manuals and training guides for the use and guidance of employers that local companies could use. And fourthly, the PSB should include family friendly practices as a component of the Singapore Quality Class and Singapore Quality Award criteria. This would certainly help to focus attention of companies on doing something about it. And , as a small bonus, the Minister could convince IRAS to throw in double tax deductions to companies for expenditures on providing family friendly benefits. And finally, a separate but related initiative, I believe MOM is looking at how it can facilitate the development of a home management industry at community level. Such a development would provide a most welcome additional source of assistance to working homemakers in juggling their varied responsibilities.

Sir, I want to ask the Minister some questions on the alternative arrangements in a knowledge-based economy. With this new development in work arrangement under a KBE including flexi-time working at home, stock option schemes, etc., which are used to facilitate the new knowledge workers, there is also a need to incorporate a new compensation and worker welfare scheme into our current system. For example, currently employees' medical coverage, work remuneration, savings in the CPF, leave, workers' compensation are all found under the Employment Act in the ambit of the employment relationship. When workers are engaged on contract schemes for intensive work and are paid in wages or stock options, and perhaps working most of the time outside the office, how does the Ministry ensure that these workers will also have sufficient savings for retirement and medical cost, savings for training, etc, when they reach old age so that they will not become dependent on the State, and that when these new economy workers reach old age they will be adequately protected? We can either devise a new system of contract service employment or we can pep up the existing Employment Act to meet these new requirements. I hope the Minister will elaborate.

Sir, during the debate on the Budget, I spoke about the part- time and contract workers. I am concerned today with the situation of our part time and contract workers, most of whom are less skilled and less well worth off.

4.10 pm Most of these people generally face difficulties in getting full-time job because they lack the skills and are maybe in the process of acquiring new skills, or deemed to be too old by employers. But these workers have financial commitments to honour. With their already lower income from part-time or contract work, and their CPF savings being very small, they will face difficulties in their financial commitment. In comparison to other sectors of the working population, they possess fewer savings. Unlike full-time workers, part-time and contract workers have no medical benefits and are not even granted the basic sick leave. Generally, they do not even have any CPF contribution, and this makes it impossible for them to plan for their future. Simply put, if they are unable to work, they would not get paid. It is likely that they would not have any form of savings to fall back on. The number of part-time and contract workers is still small. It is growing. The long term solution to this problem lies in getting this group of workers skills upgrading courses. We have done quite well here and have achieved some measure of success. But due to the large number and there is time lag in training them, we will continue to have a large number of people who may be unable to get full time jobs and unable to honour their financial commitment. Although it is not realistic to expect employers to give full benefits to this group of workers, there is space to provide a higher minimum social safety net. For example, they could have regular but reduced CPF contributions from their employer's side based on their average monthly income, which at least means regular payment into their CPF. Employers can also be required to provide the minimum insurance coverage to contract workers. A system of medical co-payment would help our part-time and contract workers. It would enable them to become more independent and they would be able to plan for their retirement as well as other needs, for example, repayment of their HDB mortgages without relying too much on special assistance schemes. In the absence of any assistance to part-time and contract workers, this group would be severely disadvantaged in the rapid progress of our society. I strongly urge that we help those who are most needy and there is little doubt that this group of workers is in this category.

Sir, I thank the Members who have spoken on the various subjects. Let me now first respond to Mr Ong Ah Heng. He raised a number of issues. First, I would like to say that I agree with him that one of the problems that we are facing is this shift in the industries. They have to move away from low cost labour-intensive to more high value-added which will result in the emerging structural unemployment. More workers are going to be retrenched from these lower skilled jobs and they just cannot find alternative jobs unless they upgrade their skills. So I agree with Mr Ong that retraining of the workers is critical and that retraining cannot be put off until the workers have been retrenched. It will be rather late in the day to talk about upgrading the skills of a worker on the eve of his retrenchment. Because that means you have to undergo a period of training before you can take on another job. It is better for a worker in this situation, in such vulnerable jobs, lower-skilled jobs, to constantly upgrade his skills, so that any time when the threat of retrenchment materialised, he should be comfortable in the knowledge that he has acquired sufficient skills that will allow him to transit to a different job with another company, or maybe even undergo a short period of retraining to take on jobs that are available in other sectors. I think this is one aspect that we have to be well aware of, that as we evolve into a knowledge-based economy and as we face the pressures of globalisation, our workers are going to be exposed to the full pressures of global competition. Skilled workers will remain in demand in Singapore, like they are in demand everywhere else. For instance, recently Germany has announced that they want to open the doors to 75,000 IT professionals. There are jobs going for this area and they cannot find enough people. The US is also facing a severe shortage and they have already increased the visas for professionals for skilled workers from about 65,000 to 150,000. In fact, the employers there in the US are clamouring for even more for this type of H1B visas. So strong demand will really push up the wages of these workers, the highly-skilled workers. But, at the same time, technological changes will also compel these skilled workers to undergo constant upgrading, and they should not put it off until the threat of retrenchment is imminent. They should constantly make effort to upgrade their skills to stay relevant, to remain employable. On the other hand, we have our lower-skilled workers. They will face threats of unemployment, as Mr Ong has mentioned, because many of the jobs are going to be phased out as the company relocates from Singapore, because they find that the environment is too costly for that type of operation. For this group of workers, skills upgrading is even more critical. It will really make the difference between getting an alternative job or remaining permanently unemployed. Mr Ong also mentioned that maybe we should have some incentives to encourage employers to hire older workers. We already do give employers such incentives by way of providing a higher level of subsidy for their training and retraining under the Skills Redevelopment Programme. Employees above the age of 40 can receive 100% full subsidy on all training expenses and up to 85% subsidy for absentee payroll under the Skills Redevelopment Programme. So I think this would help employers to overcome the mindset about the reluctance to employ older workers. But, at the same time, we should be careful. We should not go overboard with incentives so much so that it could distort the labour market and create a sense of complacency among older workers that, in fact, they are going to be guaranteed a job, regardless of what happens. I think we want the older workers to also feel the same sense of urgency that they must make personal effort to upgrade their skills, so that they will stay employable. I think the other Member who spoke on this issue is Mr Chay who has commented on the group of workers who may not have the basic ability to be upgraded broadly because of the low level of education. I mentioned just now in my response to Mr Charles Chong that we are equally concerned if this group of Singaporeans, who through lack of education, will have greater difficulty to be upgraded. Our approach is to try to re-engineer jobs in different sectors so that this group of lowly educated workers can also find alternative employment. For instance, we have initiated a strategy in the cleaning industry and the construction industry. We want to transform jobs in these industries into more skilled jobs, into higher value-added jobs, so that older workers who are retrenched from their jobs in the manufacturing sector, for instance, could move into these new jobs with minimal amount of retraining. Such retraining would be at a level which we believe these older workers would be able to cope with. I agree with his idea of introducing skills multiplier, in other words, helping our workers to be more adaptable and to have greater capabilities to cope with the demand of the new jobs. I mentioned earlier on in my response to Mr Chong that we will, in fact, encourage the workers, particularly those with post-secondary education, to move into more multi-disciplinary training. But at the level of the mature workers, we will also have programmes under the Manpower 21 initiatives to help workers who need to acquire new skills or different skills in order to remain employable. Mr Hawazi Daipi has asked what would be the projected unemployment rate this year. In 1998, when we faced the full brunt of the economic downturn, we saw about 29,100 workers retrenched over the year. Last year, in 1999, when the economy started to recover, we saw 14,600 workers being retrenched. Prior to the crisis, the average retrenchment a year was around 10,000. So I would say that this year, the likely retrenchment numbers are going to be somewhere between 10,000 and 15,000, unless something exceptional happens, because the process of restructuring will continue. Faced with greater competition, companies will continue to restructure, particularly in sectors like electronics, where the margins are getting thinner, and there will be tremendous push to raise productivity and cut costs. In the process of restructuring and redistributing their operation where the lower value-added operations are moved out of Singapore, we have to anticipate continuing retrenchment in this sector. So while new jobs are being created, we are also going to lose some other jobs. I would expect retrenchment to be somewhere between 10,000 and 15,000. Next, I turn to Mr Inderjit Singh who suggested a scheme to prevent job-hopping. I am glad that Mr Singh has agreed that the CPF is really not the mechanism, because this was proposed previously. He has now come up with a new suggestion, a national compulsory savings scheme, where employees and the employers can jointly contribute to a fund which will be used to pay a gratuity for long-staying employees. I think the approach is sound. I agree with that, and I would support employers who want to set up such a fund. But my question is: Do we have to make it compulsory? Do we have to apply this across the board to everybody? As it stands today, there is nothing to stop an employer from negotiating with the union or with the employees concerned, if they are non-unionised, to say that they will put aside a certain amount, whether it is from the wage increase or from the end-of-the-year bonus and keep this as a part of the gratuity to be paid periodically. I think this is entirely possible, especially if the employer were to tell the union or the employee that he is going to make an additional contribution to this fund, which his employee will benefit from if he stays for a certain period of time. So I think this can be done now, and I do not really think that we need to make it a mandatory system to be applied across the board. Such a scheme would, in fact, reinforce other schemes to reward their long-serving employees. For instance, employee stock option scheme is, in fact, attracting growing interest, and the Minister for Finance has announced that tax incentive for employee stock option scheme will be reviewed and studied to see how it could be made more favourable, particularly for the high-tech start-up companies. At this juncture, I want to explain why I am not quite keen to make this a mandatory system. As Mr Singh has said earlier on, job-hopping is quite a complex issue, and I also believe that some degree of job mobility is helpful. It sort of lubricates the labour market. In fact, with rapid IT development and globalisation, I think job mobility has increasingly become an essential feature of today's knowledge-based economy. People move swiftly to jobs and opportunities where their skills and abilities are most valued. Let me quote the President and CEO of Korn/Ferry International, a leading USA executive search firm, Windle Priem, who said that: "The Internet revolution means employees and executives know their value on the market in a click. With the average employee changing jobs five times in his career, as opposed to two times, the framework has changed dramatically."

Sir, in the new economy, market condition changes rapidly. Competition is global, capital abundant, and people must be prepared to seize opportunity quickly, just as Mr Singh himself has closed a deal in 48 hours at Internet speed. The key for companies to win in this economic race is whether they are able to recruit and retain the best talent. With skilled employees in short supply in all sectors, companies must provide innovative and flexible remuneration packages to compete and retain the best people. For example, Intel Corporation was one of the first to use employee stock option scheme as part of employees' compensation. Interwoven, a leading edge enterprise software developer on Web infrastructure and content management, recruits engineers with the lure of a BMW. And I just read this morning in the Straits Times that a New Jersey technology company called ARCNET is also using BMWs to retain its staff. The company offers the staff a BMW after they have stayed for one year. I am not saying that we should do the same in Singapore. But I am saying that these examples illustrate that successful companies use incentives to retain their valuable employees. They did not wait for mandatory schemes. So our employees must do likewise. If we restrict labour mobility, my fear is that our young, creative and dynamic talent will be drawn elsewhere. They could be attracted to freer labour market where they can apply their skills for maximum return without restrictions. For instance, if in the Silicon Valley there is a rule to prevent job-hopping, to prevent people from switching jobs or there is a mandatory scheme which will result in some personal loss if you switch jobs too quickly, will the Valley be able to spawn so many success stories and innovations? There is a competition for talent in this new economy. So tying people down through locking part of their remuneration or other mandatory savings plan may not be desirable or, in fact, appropriate in this new economy. Apart from not attracting the talent that you need, this additional labour market rigidity could translate into higher business cost for some other companies. I think we should leave it to employers to exercise their innovativeness to come up with packages and plans which will help them to retain the talent that they need. Next, I turn to Mdm Claire Chiang's point. She also talked about structural unemployment, particularly the problem of older and less educated workers and the mis-match between job vacancies and job applicants. These are issues that we are very concerned with. As I have explained in my response to other Members, these are issues that we will continue to address, and we will come up with programmes to tackle them, ie, mis-match and emerging structural unemployment. 4.30 pm She also made a point about CDCs playing a role as a job-matching agency. I completely agree with her. There is tremendous scope and opportunity for the CDCs to play a very useful and effective role in helping the older, less educated, less well-informed and non-Internet initiated people to find jobs. In fact, my Ministry is actually working on this. We are taking up this approach to collaborate with the CDCs. We have already done so in 1998 when the economy went into a downturn. We worked with the CDCs and CCCs of various constituencies to organise job fairs. We brought groups of employers, who were still recruiting workers during the economic downturn, down to the constituencies. We provided the framework and the organisation for them to put up stands. And we publicised and attracted people living in the surrounding housing estates to come down and look at what were the job opportunities available, and helped those who were unemployed to get jobs and in fact conducted the interviews there and then to be considered for various job vacancies. So we have already been doing that. We want to go one step further, along the line that the Member has suggested, by working closely with the CDCs to offer a more easily accessible and a more comprehensive job matching service. We are thinking of starting up one-stop career centres to be located in the housing estates in collaboration with the CDCs. These centres will provide a full range of services to job seekers, not just identifying possible job vacancies for them, but actually looking into the skills requirement of these jobs and then assessing the skills capability of the person who is looking for the job. In fact, advising him where to go to get the required skills upgrading, what kind of schemes would be available to him to get subsidy or funding to undergo the skills upgrading so that he can take on the job. In other words, it performs a much higher value-added job matching service. We expect to launch the first one-stop career centre later this year in collaboration with one of the CDCs. We want to take it up as a pilot project first to see how well it can be translated in real life. As regards telephone jobline, we can consider this in the context of our one-stop career centre to make it easily accessible to anybody. Next, I turn to Dr Jennifer Lee. She spoke on the importance of balancing the demands of home and work. I agree entirely with her that we should try to help Singaporeans balance the demands of home and work. As I said earlier on, if we can increase the female labour force participation rate by 3%, we have an additional 40,000 workers to contribute to the economic effort. So it is not to be trifled with. It is a very significant contribution. Increasingly, many of the housewives are better educated and have useful skills that can make a significant contribution to our economic effort. I also accept the point that there is no need to reinvent the wheel. We should learn from other people's experience. In a way, we are doing that. As I mentioned in my response to Mr Thomas, we have set up a Human Resource Promotion Section within the Ministry. The mission of the unit is in fact to promote awareness and implementation of good HR practices. We will source out companies which have implemented good HR practices and we will then develop these as case studies to be shared with the other employers so that they can also test out such innovation in their own context and, hopefully, help their workers or employees to balance the needs of home and work. We will particularly be looking at companies that have introduced flexible work arrangements which are better suited to help women balance the needs of home and work. Where there are local consultants or people with similar expertise, as mentioned by Dr Lee, we will certainly tap their expertise to help us improve this kind of HR promotion effort. I will pass on the suggestion to the Productivity and Standards Board to consider family friendly practices as part of the Quality Award. This is something we should consider to give greater recognition. I know that since 1997, we already have this Family Friendly Firm Award as a form of recognition. This was instituted together with NTUC, SNEF and Ministry of Community Development. We will continue to do this and we will continue to refine the framework so that it gives greater recognition to companies that have instituted family friendly practices. On double tax deduction for family friendly practices, this is something that has got to be considered by IRAS as there are tax implications. I am not in a position to commit whether or not we should do so. On the home management industry, mentioned by Dr Lee, yes, this is something that we are looking into because we firmly believe that there is opportunity for a home management industry to be organised in Singapore to enable more of our women to go out and join the labour force and yet have some of the duties, ie, the household chores, to be done properly by a professional group. This is an area that my Ministry is exploring. We are talking with interested parties to see whether they have an interest in initiating or starting up such ventures. Next, I turn to Mr Chay Wai Chuen who pointed out that, under the knowledge-based economy, you are going to have various innovative work arrangements, some of which we have touched on earlier in connection with family friendly practices, like flexi-time, working at home and also a remuneration or compensation system that includes new ideas like stock option scheme. But his concern is whether workers who are hired by companies on a contract basis or who are working outside the office most of the time, are covered. Let me assure him that as long as the person is an employee and there is an employer-employee relationship, whether the person works in the office full-time or part-time, or whether the person works at home full-time or part-time is not relevant. The person will still be covered by the Employment Act and the employer in this instance will still have to contribute CPF at the statutory rate, and in the case of medical benefits, like sick leave, etc, the person is entitled to what is stated in the Employment Act. Of course, if a person is working part-time only, then we have in fact a guideline on part-time work regulation under the Employment Act which will enable the employer to recruit part-time workers and offer them benefits on a pro-rata basis. But the important point to note here is that even part-time workers are entitled to the benefits. He is also concerned that some of these workers may not be able to save enough for their old age, particularly, with regard to medical expenses. As I have pointed out, in the case of those who are actually employees, they will be able to accumulate CPF savings like any other workers at the statutory contribution rates. The concern is with the group who is self-employed. This is the group that does not have to make any mandatory CPF contribution except for the Medisave. A lot of them do not make any voluntary contribution despite the fact that, if you are self-employed, you can make voluntary contribution and benefit from the tax exemption for your voluntary contribution up to a certain limit which, I believe, is around $14,000. So for this group of self-employed who only contributes to Medisave, they will obviously not be accumulating sufficient savings in their CPF accounts for their old age. We have to consider whether we should progressively encourage this group to also contribute to the CPF. One way to start is to introduce mandatory savings in the Special Account for this group so that they can accumulate savings for their retirement expenses because most of the money in the Special Account will go towards their retirement expenses. This is actually in line with what was recommended by the Inter-ministerial Committee on Ageing Population. This is an area that my Ministry is studying. We are assessing whether we should move into requiring the self-employed to also make mandatory contribution. Next, I turn to Mr Hawazi Daipi. Basically, he also raised the concern about part-time and contract workers who do not get medical benefits and CPF. As I said earlier on, if they are in fact employees, regardless of whether they are part-time or full-time, they are entitled to the same benefits spelt out in the law. So the question of requiring part-time or contract workers to contribute lower but regular payments to CPF is linked to whether we should make this group, that is presently not included in this CPF contribution framework, to also contribute, in other words, to bring in the self-employed. As I mentioned earlier on, we will look into whether we should make it mandatory for the self-employed to also contribute to the Special Account in order to help them build up savings for their retirement needs. I believe I have covered most of the points that were raised by Members.

Sir, one of the objectives of the National Skills Recognition System (NSRS) is to help workers secure re-employment should the need arise. I would urge the Ministry of Manpower to identify and certify more skills that are suitable for older workers and lower educated workers. These two groups of workers are vulnerable to any structural change in our economy and many may lose their jobs. In fact, many have lost their jobs and cannot find a new job. The NSRS should set priority on these two groups of workers so that many of them can benefit from the system and have a clear competency for re-employment. The course content, training pace and language of instruction have to take into account the uniqueness of the particular industry and profile of the workers. Let me cite one example. I remember that when I was a young boy, I followed my mother to a goldsmith's shop. She bought a piece of gold ring. She was told that the weight of the gold was so much, according to the day's market price of $20. That part you could not bargain. But it was the gong qian (the craftmanship) that was $5 which you could bargain. So $20 plus $5 was $25, and you must pay. I remember that my mother bargained for 50 cents less, so it was $24.

50. You could buy the gold ring. So who set the value of the craftmanship? In fact, today, when you walk into any jewellery or goldsmith's shop, the same thing applies. The price of the gold, you cannot bargain. In the matter of craftmanship, you can bargain for another $1 or $2 less. Again, who sets the value? Who certifies the skills? Can we re-skill or upgrade their skills so that they come out with better and variegated designs and our lower educated or older workers can enjoy a better standard of living through NSRS? However, Sir, as skills are certified at industry level and is driven by industry under the NSRS, it is difficult to get various companies, especially the smaller companies where these two groups of workers are employed, to agree on what are the generic skills required for the industry. The problem has become more complicated when it comes to similar companies in the same industry to share the training strategies due to competition in the same industry. NTUC's experience is that the certification assessment structure of the NSRS has so far been flexible enough to meet the tight operational requirements of the industry needs such as the taxi industry or public bus. 4.45 pm However, I would like to urge MOM to be more proactive and create awareness among the industries that need the NSRS system and urge the industry not just to be responsive to the industry's development. The certification process must be running ahead of the industry so that older workers and lower educated workers are reskilled and upgraded well in advance.

Sir, in the M21 plan, the National Skills Recognition System will incorporate modularity in the course content and the certification of skill competencies. This is a scheme that deserves to be supported. I feel, however, that there is a need for industry experts to be involved to map out the skills set for this NSRS. This must be people who have long experience in the industry or involved with the evolution of industry clusters locally as well as internationally. For example, the retail industry is mashed into logistics and supply chain. Hence, the skills set for the retail industry must be widened. Conversely, people from the freight delivery handling sector also converge into retailing and e-tailing. Such industry experts should also be aware of the strategic directions of the investments in our economy, as well as internationally. This is necessary because otherwise, we may come up with a very limited map or a map for yesterday's industry skills and this map should always be periodically reviewed. A map devised by human resource managers or even training managers is not necessarily the right map for the NSRS.

(In Mandarin): Sir, with the rapid advance in IT today, we must consistently upgrade ourselves, otherwise, we will be lagging behind others. We should therefore encourage our workers to learn and continue to learn and to cultivate the concept of life-long learning. Some workers who are aware of the need for continuous learning have gone to attend classes to upgrade themselves and hence enhance their market values, while others have not seen such a need. Some do not even know where to attend such classes and maybe there is no impetus to motivate them to learn. The Manpower 21 plan formulated last year aims to promote life-long learning and to set up a national institute to realise such a plan. But I am particularly concerned with workers who are in the service sector. They urgently need such upgrading but they lack the necessary encouragement and information on how to go about doing it, whereas in the manufacturing sector, a lot has been done in this area. With the participation of some companies, a series of technical courses have been designed and conducted. Moreover, there is a comprehensive range of standardised courses for the workers. But workers in the service sector have been neglected. How do workers in the service sector upgrade themselves? What suitable courses are available for them? What types of jobs would no longer be available? What new skills must they learn? All these questions should be comprehensively addressed in the report on life-long learning. Let me cite an example. I know of an unemployed student who has studied mass communications in an overseas university. He would like to work in the IT industry. He consulted a professional who worked in the IT industry on what sort of IT courses he should take up. He wished to pursue an external Masters degree on IT for non-IT savvy people conducted by a private institution. After reading the prospectus for the course, he felt confident that he could complete such a course. However, his friend advised him not to pursue such a course because it was meant for senior managers who need IT knowledge to help them formulate policies. It was not a course on how to use IT. Eventually, he chose a diploma course. Another example concerns a worker in his 40s. Like other workers, he was eager to upgrade himself by attending a personnel management course which had nothing to do with his present job. Having completed this course, he was still doing the same job and he felt that it was a waste of time getting such a diploma. Sir, I believe that there are many people who have had such similar experiences. Life-long learning is not a new concept. In the past, we have adult education courses for people who, for some reasons, could not complete their formal schooling in their younger days and would like to catch up with their studies, and for those who have finished a certain level of their formal education but would like to upgrade themselves professionally. But today, life-long learning is no longer the pursuit of formal education but an effort to ensure one's life-long employability in the changing labour market and to stay competitive. As such, our national life-long learning concept should encompass workers in all sectors to enable them to upgrade their skills and to change jobs. Employers should be involved in training their workers and when they have learnt certain new or better skills, due recognition should be given to them, though not necessarily in monetary form. I would like to raise a related issue. As the objective of life-long learning is to ensure the workers' employability, it is the employers who should undertake such a task as they know better what their workers need. But many employers are not taking the initiative. We have many excellent managerial people. This is evidenced by our ranking by the World Economic Forum and other independent organisations. Therefore, our managerial staff can upgrade themselves, particularly in areas such as business strategies, decision-making and human resource management. Sir, I would like to remind this House that while urging our workers to upgrade themselves, we should provide them with the necessary information and incentives and should not resort to applying pressure on them. In this way, they will be more interested in learning a new skill and feel that it is to their benefit that they do so.

(In Mandarin): Sir, in last year's Budget debate, I pointed out that the training programmes of workers have to be supported and approved by employers. I am glad to know that now the workers can go to the CDAC or the CIDB as their "surrogate employers" to obtain training and retraining. But this "surrogate employer" scheme has not been publicized and made known to the workers. I think MOM has to step up its publicity of these training programmes for workers so that they know the channels to which they can obtain such training and skills upgrading. During my meet-the-people sessions, quite a number of people came and told me that they were facing employment problems. Broadly, there are two classes of unemployed workers. One class is 40 years and below, but with low education and low skills. They have to compete with foreign workers and they either lose their jobs or their incomes are reduced. The other group consists of those above the age of 40 years. Some of them have some skills, some with low education and some have no skills and they could only go for odd jobs because most of them are not unionised. These workers are facing difficulties in finding jobs. We can imagine that when our economic restructuring is complete, it would be even more difficult for these people to find jobs suitable to them. MOM should look after the plight of such people and give them the proper training and job opportunities so that they will be able to contribute in the framework of our new economy. I do not know how many of such workers we have. Maybe MOM can give us some figures. But even if this is only a small number, they should not be overlooked because they are most vulnerable. They are part of us. We expect MOM to give them all the necessary help and support.

Sir, I am addressing employment and challenges of a group of older people on the other end of the spectrum. These are not the over 40s who have secondary education, in the unskilled or semi-skilled category. They are the over-40s who have post-secondary or even higher educational qualifications in the professional and management categories who are also not spared from the trauma of unemployment. Using the web page in MOM again under the section on job sought and vacancies available in December 1999, there were more people in this category looking for suitable placement than there are jobs. In fact, during the economic downturn, those retrenched had turned to taxi-driving and various other means of livelihood not quite befitting their qualifications but they tried their best to make ends meet in order to support a growing family. Indeed, for companies not in the manufacturing sector, which were and are still restructuring, streamlining and downsizing to survive, the layer of personnel they would first retrench is the middle management workers because they are the ones who constitute higher operation cost and their retrenchment actually makes a significant shift in the company's bottomline. This middle management layer are those usually in the 40s, who cannot benefit from the SDF programme. May I just add that, unlike previous years, when the social service centres were frequented by women help seekers, they are currently responding to increasing number of men on the helpline and in face-to-face counselling. The highest worry is the loss of jobs which clearly affected their self-esteem. This has a triggering effect on family dynamics and equilibrium. I would like to seek the Minister's direction on what more we can do for these educated 40s, who are neither here nor there, to stay competitive and employable in our lead towards KBE. What concrete help can we extend to them to tap their productivity? Can we also launch a sector driven SRP for the professionals and mainstream occupational groups to see how they can reskill and redeploy the talents in the new economy? If they were to get a MBA course, Sir, where do they get the money and how do they pay for the mortgages, and what does the family live on? It would only add financial stress to the family. I seek the Minister's comments on these matters.

We have got one minute more. I think we can stop here. Thereupon, Mr Deputy Speaker left the Chair of the Committee and took the Chair of the House.

Mr Deputy Speaker, I beg to report that the Committee of Supply has made further progress on the Estimates of Expenditure for the financial year 2000/2001, and ask leave to sit again on Monday, 13th March 2000.

So be it.

Resolved, "That Parliament do now adjourn." - [Dr Lee Boon Yang]. Adjourned accordingly at Five o'clock pm to Monday, 13th March, 2000.