Hansard, 2000-05-22

PERMISSION TO MEMBERS TO BE ABSENT Under the provisions of clause 2(d) of Article 46 of the Constitution of the Republic of Singapore, the following Members have been granted permission to be or to remain absent from sittings of Parliament (or any Committee of Parliament to which they have been appointed) for the periods stated: NameFromTo (2000)(2000) Mr Zulkifli Baharudin26 Apr28 Apr 5 May11 May Dr Jennifer Lee28 Apr7 May 21 May27 May Mr K Shanmugam28 Apr14 May Mr Sidek bin Saniff29 Apr1 May Mr Ahmad Md Magad1 May3 May 9 May19 May Prof S Jayakumar3 May4 May Mr Lim Swee Say3 May5 May Mr Lim Hng Kiang5 May7 May Mr Tay Beng Chuan6 May13 May Mr Lew Syn Pau6 May20 May BG George Yong-Boon Yeo6 May22 May NameFromTo (2000)(2000) Mr R Sinnakaruppan7 May8 May 10 May20 May Mr Matthias Yao8 May10 May 25 May10 Jun Dr Ker Sin Tze8 May15 May Mr Davinder Singh 9 May9 May Encik Yatiman Yusof 9 May9 May Mr Tang Guan Seng9 May14 May Dr Teo Ho Pin9 May18 May 8 Jun12 Jun 19 Jun22 Jun Mr Ong Kian Min10 May12 May Dr Lee Boon Yang10 May13 May Dr Ong Chit Chung11 May12 May 23 May1 Jun 4 Jun7 Jun Dr Wang Kai Yuen12 May14 May 18 May21 May Assoc Prof Koo Tsai Kee19 May22 May Mr Loh Meng See19 May28 May Mrs Lim Hwee Hua23 May27 May RAdm Teo Chee Hean25 May31 May 14 Jun18 Jun Mr Lee Yock Suan10 Jun29 Jun Dr John Chen11 Jun18 Jun TAN SOO KHOON Speaker Parliament of Singapore

ASSENT TO BILLS PASSED The following Bills were assented to by the President of the Republic of Singapore on the date stated: 8 May 2000 (i) Chemical Weapons (Prohibition) Bill; and (ii) National Science and Technology Board (Amendment) Bill. TAN SOO KHOON Speaker Parliament of Singapore

MR J B JEYARETNAM - (Announcement by Mr Speaker) Order. At the sitting of Parliament on 9th May 2000, I informed hon. Members that Mr J B Jeyaretnam had filed a Notice of Appeal to the Judge of the High Court in Chambers against the Bankruptcy Order made against him. I also informed hon. Members that it was not appropriate for me to ask Parliament to make a determination under Article 48 of the Constitution as to whether his seat has been vacated as the Member had filed an appeal. The appeal was heard on 11th May 2000 and the Registrar of the Supreme Court has informed the Clerk of Parliament that the Judge had set aside the Bankruptcy Order made against Mr Jeyaretnam on 5th May 2000. I have sought the advice of the Attorney-General on the effect of the decision of setting aside the Bankruptcy Order against Mr Jeyaretnam in relation to his seat in Parliament. The Acting Attorney-General has, on 17th May 2000, advised that: "The effect of the Court setting aside the Bankruptcy Order is as if the Order was never made. Mr Jeyaretnam was therefore not an undischarged bankrupt between the period 5 May - 11 May 2000. It follows that Mr Jeyaretnam did not vacate his seat in Parliament on 5 May 2000."

(Presence in Gallery) Order. On behalf of hon. Members, I welcome the Hon. Vice-Chairman, Carlos Costa Neves, and Members of the European Parliament Delegation for Relations with ASEAN and the Republic of Korea, who are present in our Gallery. [Applause.]

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) asked the Prime Minister, in the light of the gradual restoration of employers' CPF contribution following the rebound in the Singapore economy, whether the Government will similarly adopt a gradual and staggered implementation of hikes in charges for the use of amenities, facilities and services such as bus/MRT/taxi fares, utilities rates, rental charges, so that the impact of these hikes will be more manageable for the ordinary Singaporeans in general and for those in the lower-income group in particular.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, when I announced the CPF restoration and the extension of some cost cutting measures in November last year, I had stated that the Government could not hold back all fee increases. Some adjustments would be necessary. However, I gave the assurance that the Government would exercise moderation in revising public sector fees, which it has done. When the Government cut employer CPF contributions, we did not impose either a wage or a price freeze on the economy. The purpose of the CPF reduction was to reduce business costs and help companies to regain profitability, but without making the labour market rigid or distorted. Now that the economy is recovering strongly, we need to manage the full restoration of CPF contributions, simultaneously with wage adjustments, so that total wage costs do not increase too suddenly. I believe the NWC is actively discussing this issue, and will make its recommendations soon. On prices, the Government does not approve or disapprove price changes by private sector companies. During the crisis, many firms held back necessary price adjustments, so that now some catching up is necessary. The Government is, however, mindful of the combined impact of individual fee increases on the overall cost of living, and watches price levels to ensure that inflation stays under control. In the case of bus and MRT fares, operators have to justify the fee increases to the Public Transport Council. MTI estimates that the adjustments to gas and electricity tariffs, bus and MRT fares, and taxi fares will increase the Consumer Price Index (CPI) by only 0.22%. Their impact on the cost of living of lower income groups is slightly higher - 0.25%. But overall, MTI's forecast is that CPI should increase by only 1-2% this year. This is quite modest. In comparison, 2% points of employer CPF contributions have already been restored in April. Given the tight labour market, we can expect wage settlements to be generally higher than last year. Therefore, allowing for inflation, most Singa poreans will enjoy increases in their real, disposable wages this year. In addition, the Government has given rebates on HDB rentals, town council's service and conservancy charges and PUB charges to lower income households. These rebates exceed any likely impact of inflation on these households. Thus, while consumers will not welcome any new or increased charges, however moderate, taken together these adjustments are unlikely to impose hardship on Singaporeans.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, when I last asked the question on the bus and MRT fare increases, the Minister of State was unable to answer my question whether he was aware that the bus companies had been making profits. I have now learned that they have been making quite substantial profits. Does the Government still think that it was necessary to increase the bus and MRT fares?

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, the Member was not here when I addressed this issue at the last sitting following his exchange with the Minister of State. I explained that all companies have to make profits, because if they do not make profits they will fold up. Are they reasonable profits or are they excessive profits? That is a matter for the bus and public transport companies to justify to the Public Transport Council. They have put up a proposal and members of the Public Transport Council have scrutinised the proposal and they have decided that these increases are fair. I see no reason to challenge that conclusion.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Is the Minister saying then that the bus and MRT transport should be run for profit and not as a public service to the people who need to use them?

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, there are tens of thousands, if not, several hundred thousand Singaporeans, who own shares in SBS and there is a reason why we arranged the scheme so that the shares are widely distributed among Singaporeans. That is precisely because it is necessary for all services to run efficiently and one of the measures of efficiency is that you break even and earn a reasonable profit. There are subsidies which we have provided bus companies - roads, bus terminuses, taxes. But given what we have already decided they are entitled to, they have to operate efficiently and the measure of that is that they have to earn a profit.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Two supplementary questions. I would like to ask the Deputy Prime Minister if there are any coordinated efforts by the Government, for example, by way of an inter-ministerial committee, to consider the impact and timing of price hikes for public amenities, facilities and services by the various ministries. The second question is that for the timing of future price hikes within the control of the Government, will consideration be given to take into account the fact that salary increments and bonuses are usually given once a year and that there are still many months to go before the year-end increments and bonuses materialise?

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) On the first question, we do coordinate among the ministries. We do not have a formal committee, but we do coordinate among ourselves, because it does not make sense for us to have several sudden adjustments taking place one after the other and causing an unnecessary shock to people when very often, in fact, there is no reason to be shocked. The second question is whether we should therefore take into account the timing of the private sector salary increases which happen once a year. I would suggest that if we make all our price increases once a year, that might cause bigger shocks, rather than smaller shocks. I do not think all the private sector salary increases take place at the same time. The NWC makes its recommendations in May or June and companies take a few months, and some take many months, before they settle the agreement and then they are paid. Collective agreements come due at different times. Some bonuses are paid at the end of the year and some are paid in the middle of the year. These adjustments are spread out during the year and therefore price adjustments also quite reasonably ought to take place during the year. The key question, as I have pointed out, is whether the cumulative effect of all these price adjustments is a high inflation rate or a low inflation rate. I have pointed out that, in fact, we have ended up with a very low inflation rate. In fact, it was negative for several years. Last year, it was less than 1% and this year we think it will be less than 2%. CPF has gone up 2% already - that is not take-home pay - but I am quite sure take-home pay will go up by more than 2% this year, because the labour market is so tight. These are adjustments which we have to accept. If inflation goes up 5%, 6% or 10%, then there is reason for people to worry because that is very big and you are unable to plan ahead and maybe if oil prices shoot through the roof that might happen - it has happened before - but that is not the situation we are in today.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) I would like to ask the Deputy Prime Minister whether there is a possibility of giving off-Budget measures, such as helping the lower-income group. He has just said that the inflation rate might go up from 1% to 2% and, as it has been in the past, for the lower-income workers who I have looked after in the trade unions, their increments are very marginal. So 1% increase in inflation rate could have a serious impact. I would like to know whether there could be a possibility of some off-Budget measures.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, I think we had better understand that we are living in an unnaturally calm state of affairs right now. Inflation of 1-2% is actually, by historical standards, quite low. In Singapore, that is what we have been able to achieve for many years but internationally 3%, 4%, sometimes even 5%, inflation in the developed countries has been quite normal. Maybe the world has changed. The central banks have been careful, governments have been running smaller deficits and, in some cases, surpluses. Inflation has generally come down round the world, also helped by lower oil prices until fairly recently. Because of that backdrop and also because of our prudent policies in Singapore, we have been able to keep our inflation to 1-2%. Despite this, every year, during the Budget, because we have some surpluses, the Finance Minister has been able to scatter confetti all around. We have got utilities rebates, service and conservancy rebates, CPF top-ups. As I have said, they all add up to a significant sum of money for the lower income group. They are not meant to offset and make up totally for inflation, dollar for dollar. That is not possible. But taken overall, I think there is no question that they have enabled lower income Singaporeans to enjoy significant improvements in their standard of living in addition to what they have been able to get because wages have been generally going up from year to year.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, in consideration of much stronger than expected economic growth, I would like to ask the Deputy Prime Minister whether it would be reasonable to expect another round of partial restoration of CPF within the year.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Mr Speaker, Sir, I will await with bated breath the report of the National Wages Council. I have no doubt that this will be a hotly discussed subject in the NWC because we have published our first quarter economic results last Friday and they have been good. There is a basis and I am sure the unions will argue that we should bring forward the restoration, maybe not the full restoration, but certainly to bring forward the restoration to some degree. The question is what we see for the rest of this year, whether it will continue as strong as it is now, or whether there will be any clouds on the horizon. Traditionally, MTI's view in the first half of the year has always been that the second half of the year would be a little bit slower. That is a cautious approach. We do not wish to raise unjustified euphoria and we always want to be a little bit on the cautious side. If you ask me now whether there is a basis to say definitely that the economy will slow down, I would say no, we cannot say. But are there uncertainties? Yes, there are some uncertainties, because it depends on the US economy, whether it is showing signs of overheating, whether the Federal Reserve Board will be able to moderate its growth without precipitating a recession, which is a very delicate balancing act. It depends on whether the European economy will continue to grow strongly. It is showing signs of doing so now and we hope it continues. We trade considerably with them. And it depends on the Japanese economy, whether it will continue to pick up or whether the beginnings of a recovery which we have seen will peter out again. I see today Mr Miyazawa has said that the first quarter was good, but the second quarter is a little uncertain. Plus, it depends on what happens in our region, Malaysia and Indonesia particularly, which is a matter of considerable concern to us, and what happens in Singapore, whether we are able to sustain the productivity growth and generate the higher output without our own economy overheating. So there are some uncertainties, but I think that, overall, we feel much more optimistic now than we felt a year ago and, certainly, even six months ago. And so I look forward to the NWC making some constructive recommendations in this respect.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) Can I ask the DPM whether the economy is really robust because, from the ground, quite a lot of the other sectors are not performing that well. Is the 9% growth which was registered as robust as it seems to be? Secondly, I want to ask the DPM whether he foresees all these concerted price increases will drive up consumer prices and affect the ordinary wage earners.

ORAL ANSWERS TO QUESTIONS - HIKES IN RATES AND CHARGES - (Gradual and staggered implementation) The first question is whether the 9% is real. Well, it is there, unless you doubt the number. Does that mean every company is doing well? Not necessarily. I know that some of the small retailers in the constituencies are not feeling as much of the lift as they might if the economy was just generally expanding. But overall, from the macro point of view, it is quite a widely based expansion, because it is in manufacturing, services, trade, banking and finance. The only sector which is not growing is construction. But that is because we have an overhang, a downturn, and that will take some time to turn around. But overall, it is fairly broad based. His second question is whether we think these price increases will drive up the cost of living. I have given him MTI's estimate which is, despite the cost increases, overall, we think the CPI will go up by 1% to 2% this year. And I think that is acceptable. I do not see a sudden spiral-up in price levels unless we have some significant difficulties, say, with energy prices. Then of course it cannot be helped. And electricity prices are linked to energy prices. If oil prices go up, somebody has to bear it and Singapore Power cannot absorb it indefinitely. So eventually, electricity prices have to go up. What to do - we have no gas or oil gushing out from the ground.

WOMEN IN WORKFORCE asked the Minister for Manpower what constructive steps are being taken by his Ministry to attract more women into the workforce.

WOMEN IN WORKFORCE Mr Speaker, Sir, the return of married women to the workforce, more often than not, is a family decision, involving factors such as alternative child care arrangements, costs and benefits, whether the women should stay at home to look after the family or go out and work to supplement the family income and also the confidence of the women who have been absent from the workforce for some years in returning to work. My Ministry will try to facilitate the return of the married women back to the workforce and we will encourage employers to help working women to better manage family and work commitments so that they need not drop out as a result of family commitments. Over the past years, through our tripartite network, we have been encouraging and emphasizing pro-family or family-friendly practices at the workplace. In 1996, we launched the "Back to Work" Programme with the support of the Productivity and Standards Board, NTUC and Singapore National Employers' Federation. This programme was aimed at helping married women re-enter the workforce. This will require employers to adopt more "family-friendly" practices. Sir, currently, our labour laws do not restrict employers from arranging any workweek patterns to meet the needs of the companies and their employees. In addition, the Employment (Part-Time Employees) Regulations, introduced in 1996, provided greater flexibility for employers to pro-rate the benefits based on the number of hours an employee puts in and ensured that part-time employees are given the basic benefits stipulated in the Employment Act. The Regulations also allow the encashment of statutory benefits, such as annual leave and public holiday pay. The Regulations will facilitate the introduction of part-time and flexi-work arrangements. Employers are encouraged to introduce such arrangements so that married women could better balance their work with family responsibilities. The promotion of family-friendly practices is not a one-off affair. It is going to be a long-term effort requiring the support of employers and unions and their members. We will continue to explore all avenues to facilitate married women's entry into the workforce.

WOMEN IN WORKFORCE May I ask the Minister whether he would give further assistance through part-time employment schemes and whether his Ministry would facilitate further the opportunity for women to work from home or tele-commute?

WOMEN IN WORKFORCE Mr Speaker, Sir, in fact, we do encourage as many employers as possible to consider tapping the pool of married women, the housewives, to supplement the existing workforce, and we encourage them to redesign their jobs so that some of the jobs can be offered to women on a part-time basis. Some companies are already taking it up, particularly those in the retail sector, the department stores. I understand that some hospitals are offering part-time employment opportunities to the nurses and I am sure the Member would have heard about the offer by the Ministry of Education of part-time teachers to work in the schools, ie, to teach on a part-time basis. As I said earlier on, it is a continuing effort. As the labour market tightens up in view of the economic turnaround, we are expecting more employers to have greater difficulties recruiting the workers that they need. So those who are more innovative will have to come out with new recruitment offers to attract the inactive women to rejoin the workforce.

WOMEN IN WORKFORCE May I ask the Minister whether his Ministry has new incentives, especially in areas that help women harmonise work and family, to help them stay in the workforce?

WOMEN IN WORKFORCE Mr Speaker, Sir, the biggest incentive to an employer to go out and recruit economically inactive housewives is in fact to fill up his vacancy positions. He gets the workers that he needs. If he does not make that effort, he is going to be shorthanded. He is not going to be able to tap the opportunities that are available. Sir, that will be the biggest incentive to an employer. But of course, we understand that some employers have difficulties in re-engineering their jobs, for instance, and making part-time arrangement for their employees. We offer through the Productivity and Standards Board a programme called the Core Skills Training. If an employer is prepared to recruit a housewife for a particular job, we are prepared to help the employer provide the kind of training that is needed for a housewife to re-enter the workforce. This training will include confidence building, work effectiveness, computer basics, communication and quality work principles. We will support the employer with a grant of about $350 per employee on the scheme which includes a training allowance of $100 to be paid to the trainee to defray out-of-pocket expenses during the period that the new employee is undergoing training. This is just one of the incentives that we have to help economically inactive women re-enter the workforce. We have also offered a job skill training programme for employers who recruit housewives. This will cover up to 80% of the course fee for the specific job skill training that is required to help a housewife acquire the skills that will be needed by the employer in this case.

WOMEN IN WORKFORCE I was told that women in the high level jobs did not seem to get promoted in their career, and this is one of the greatest barriers why women do not want to go back to work part-time. And for those who have stayed part-time they feel demoralised at work. Would the Minister comment on this?

WOMEN IN WORKFORCE I think we are on very tricky ground, Mr Speaker, Sir. It is not fair to generalise that women in the high level jobs are not promoted just on the basis of gender. There are equally significant examples where women are in leading positions in many organisations, both in the private and public sectors. So it is not fair to comment on that basis. But the situation in our labour market is that many women tend to leave the workforce soon after they get married and started a family. So on average, if you look at the profile of the workforce, you would see that women in Singapore earn a lower salary than men and some have pointed to that as gender discrimination. In fact, what it really reflects is that women are withdrawing from the workforce. So the average experience level of women in the workforce is lower than men because they do not work that many years. If you average out the wages earned by women and men, you will find that men have a higher earning because they have more years of experience on the job. So it is not fair to conclude that women have been discriminated against in this sense. I would say that we should not generalise on this basis. There are many opportunities for women in Singapore to excel and demonstrate their capability to contribute to the company, and they have risen in their ranks. We have Japanese multi-national companies being led by women, we have local companies like the promising local enterprises and GLCs being led by women and we also have Government departments with women in very senior positions. We should look across the board instead of generalising and saying that women are somehow being discriminated on the basis that they are women.

WOMEN IN WORKFORCE May I ask the Minister whether he would agree that childcare leave and third child maternity leave are good incentives for women to balance between work and family and to remain in the workforce?

WOMEN IN WORKFORCE There is a lot of flexibility, in terms of childcare leave. Employers, particularly in the unionised sector, do consider granting additional childcare leave, especially in the case when the employee's child is sick, or for whatever reason. In terms of maternity leave, the law provides for paid maternity leave for the first two children. Or in the case of the third child, instead of imposing a requirement on the employer to provide paid maternity leave, the Government has provided a whole slew of tax benefits for parents of the third child. The tax benefits more than offset the loss of the paid maternity leave. So this is a preferable arrangement rather than to mandate that employers must also grant paid maternity leave to all employees in the case of the third pregnancy. Because by doing so, we will actually be shifting the cost of paid maternity leave to the employers. As it stands today, encouraging families to have more children is a very urgent national objective. Therefore, the Government has taken the approach that we should do so by giving tax incentives rather than to pass the burden to the employers. So if we want to encourage parents to have more children, we should not, in doing so, impose unnecessary costs on the employers affecting their business competitiveness. Where it is possible, for instance, promoting and encouraging a bigger family, the additional costs can be borne by the Government by way of a special tax incentive. And I understand that the Ministry of Finance and IRAS have a whole slew of very attractive tax incentives for parents who want to have more than two children.

WOMEN IN WORKFORCE Mr Speaker, Sir, the Minister says that it is unfair to say that married women have been discriminated. Has his Ministry got any figures to support his statement that they have not been discriminated? I have called for a Board against discrimination more than once. Will the Ministry set up a Board against discrimination in Singapore to inquire into any complaints?

WOMEN IN WORKFORCE Sir, it is the usual response from the Non-Constituency Member to set up a Board for this and to set up a Board for that. Let me suggest to him that if he has instances where he believes that a woman has been discriminated on the basis of gender or marital status, let us know. We have a comprehensive system to assist workers who have been so discriminated.

WOMEN IN WORKFORCE I would like to clarify the point that I was not talking about wage discrimination. I think the marketplace decides the differences and so far, I cannot see any evidence of clear discrimination, and that it has been fair. I am talking about promotion to the next job rank. And from some of the doctors that I speak to who opt to do part-time services, they feel that their full-time colleagues who started on the same level get promoted faster.

WOMEN IN WORKFORCE Order. Is the Member making a speech?

WOMEN IN WORKFORCE I would like the Minister to suggest ways where the part-time schemes can be seen as attractive and how we can go about doing that.

WOMEN IN WORKFORCE Sir, when an employer promotes an employee, it must be on the basis of the contribution that the employee makes to the organisation. I think it would be difficult for us to dictate that part-time female employees should be promoted on the same basis as a full-time employee. This has got to be left in the hands of the employer who would judge who within the organisation can best make a difference to the organisation's success and, in that case, promote the appropriate person.

WOMEN IN WORKFORCE May I ask the Minister whether our incentives are too restrictive if they are related to income tax because 70% of Singaporeans do not pay income tax?

WOMEN IN WORKFORCE Sir, while it is true that 70% of employees do not pay income tax, it is also equally important that for those who want to have more children, a bigger family, must be in a position to support and look after these children. The encouragement to have a bigger family is to have more than two, if you can afford to look after them. Therefore, our tax measure is closely related to this approach of encouraging those who are in a better position to provide the family environment and support for more children to do so, rather than to pass this cost of having bigger families to the employers and, therefore, loading them with a burden and, in a way, even affecting their competitiveness and business survival.

WOMEN IN WORKFORCE May I ask the Minister whether he will agree that in view of the declining total fertility rates in Singapore, we should review our stand and whether he could reconsider changing some of the incentives?

WOMEN IN WORKFORCE Sir, there is already an existing high-level committee led by the Permanent Secretary, Prime Minister's Office, who is looking into new ways and means of encouraging procreation. So we shall wait for the committee to consider various suggestions.

UNSKILLED WORKERS IN SERVICE AND RETAIL SECTORS - (Shortage) asked the Minister for Manpower whether his Ministry will look into the current shortage of unskilled workers in the service and retail sectors and review or relax the policies governing the issue of work permit for businesses which depend on foreign workers to survive.