Hansard, 2009-05-27

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: Name From (2009) To (2009) Mr Hri Kumar Nair 27 May 30 May Dr Ong Seh Hong 01 Jun 03 Jun Mr Tharman Shanmugaratnam 01 Jun 04 Jun 08 Jun 15 Jun

ABDULLAH TARMUGI Speaker Parliament of Singapore

Order read for Resumption of Debate on Question [25th May, 2009],

'That the following Address in reply to the Speech of the President be agreed to:–

"We, the Parliament of the Republic of Singapore, express our thanks to the President for the Speech which he delivered on behalf of

the Government at the Opening of the Second Session of this Parliament.".' – [Mr Michael Palmer].

Question again proposed.

Mr Speaker, Sir, thank you for allowing me to join the debate. Sir, much has been said about the unprecedented circumstances that we are now in today and how we should turn adversities into opportunities as we close our ranks, build up our resilience, ride out this crisis and emerge a stronger people. Indeed we have overcome many crises in our short history and each time the interval between crises seems shorter.

Certainly, those who appreciate and take up the opportunities and face the challenges head on will succeed. However, the implication is that there will be those who will be left behind, widening our income gap. To many of those in this latter group, it may not be due to the lack of motivation but perhaps the lack of understanding of the new realities and challenges that the President had spelt about. What they constantly hear, probably, is the need for them to upgrade, get retrained and acquire new skills.

But, Sir, for someone who is a sole breadwinner – perhaps just earning $1,200 a month – supporting a spouse and four school-going children and faced with reduced income due to cost cutting measures of his employer, his immediate worry is certainly how to supplement his income to ensure his family’s survival, not upgrading or retraining. We hear much of how our extensive social safety net has been developed to meet the needs of such a family. His family will probably be saved by the safety net this time round. His children will benefit from MOE’s increased funding, being able to go to school, receiving support for their meals, pocket money, transportation, etc. He may be

assisted with another HDB loan to downgrade to a smaller flat to right size the housing loan that he may be able to afford with his reduced income.

However, given the shorter interval between economic crises, will this head of household be prepared for the next downturn? Or will it take another perhaps even wider and deeper safety net to be spread for this family at that time? What would this family have learnt from this downturn that will better prepare them for the next? Perhaps, the need to manage expenses better for financial prudence? Or the importance of investing in the young and prioritise household expenditure to reflect this? Or the importance for constant upgrading and finding new niche areas to ensure longer term employability?

Sir, in the last decade alone, we have been confronted with three major crises – the economic downturn following 911 in 2001, SARS in 2003 and now, the global financial crisis. But have we systematically assessed what have we, as a society, learnt to ensure that we are always better prepared for each subsequent downturn. What have Singaporeans learnt about household financial planning during the previous downturns to ensure that they are more prepared for this and subsequent downturns? Sir, we have said repeatedly that we have grown stronger after every crisis and we will do so again this time round.

Sir, it has been said that the whole is greater than the sum of its parts. With individual households reflecting and identifying their learning points, collectively as a society, we will be able to see better what we have gained from this crisis. This, in essence, is building up our individual and societal resilience. My fear is that if we do not consciously go through this process of reflection, we may lose the opportunity and be faced with the next crisis having to reinvent the wheel – expanding our social safety net,

asking Singaporeans to retrain, etc. Similarly, the Government and related agencies should also reflect on the learning points in terms of how the current policies implemented previously have met their objectives – for example, in encouraging self reliance, increasing resilience in the people through programmes like Work Support and Work Income Supplement (WIS).

Sir, one clear key learning point from this crisis is for us to ensure we have savings for a rainy day. Today, we see the value of this in the Government’s ability to use its reserves (or savings) to support Singaporeans to ride through this severe economic storm. Can we translate this learning point to encourage Singaporeans to save more for future economic storms that may hit us? Can the Government facilitate through financial incentives for Singaporeans to save more?

Sir, we know that apart from our compulsory savings through the CPF, Singaporeans’ rate of personal savings is low. We are able to achieve a record 90% home ownership rate because of our compulsory savings. Thus, can we use this national savings infrastructure to encourage further savings by Singaporeans? While the CPF mechanism was designed to ensure Singaporeans have sufficient savings for old age, can we start thinking how we can capitalise on the mechanism to help Singaporeans save for rainy days, given the frequency and shorter intervals between rainy days. Today, the individual member’s CPF account consists of the Ordinary Account, Medisave Account and Special Account. Can we consider creating another account, say, the Economic Downturn (ED) Account, within the individual member’s CPF account? We can allow members to withdraw this part of their savings during an economic downturn.

To ensure that we do not compromise the current system of savings for

retirement, the monthly CPF contribution will have to be increased, to be channeled into this account. However, the Government may ensure buy-in from Singaporeans for such a scheme by offering attractive interest rates to this account as it did in the recent move to offer an additional 1% to the interest rate of the first $60,000 of the members’ combined CPF savings. Further sweeteners can come in the form of CPF top-ups that Government may give during good years and channelled to this account with more going to the lower income group to incentivise them further.

Sir, I know how the Government religiously protects the CPF system and it should be rightly so. What I am proposing is to ride on the current infrastructure in the CPF system as well as Government’s already existing method of redistributing wealth to Singaporeans, to prepare for the next downturn. Indeed, when we are faced with an economic downturn, we constantly hear calls by Singaporeans to allow them to use their CPF savings to buffer the crisis. “It is my money,” they say. This proposal serves to meet this sense of personal security that Singaporeans want to have in riding out an economic downturn.

Sir, I am confident that when the next downturn comes, the Government will continue to help Singaporeans ride it with enhanced social safety nets. The proposal of an ED account can supplement Singaporeans’ enhanced self reliance, confidence and esteem as they will have their own savings to buffer the downturn.

Learning point number 2 – the family and the next generation. Sir, as part of the reflection process on learning from this downturn, I urge that we systematically study the groups of Singaporeans that are most severely affected by the downturn. We know that no one is spared – not even the PMETs. We also know that in an economic

downturn, reduced household income becomes the order of the day. However, lower income, coupled with larger family size, makes the family even more vulnerable to falling into severe crisis during a downturn. The approach as laid out in the President’s speech and the various Ministries’ addenda is right – invest in the children and secure a better future for the next generation.

However, I think it is time that we studied further, from the experience of this downturn, the profile of families who are more vulnerable. There will be a group who might have been eligible for the HOPE scheme but chose not to join the scheme. MCYS should continue to reach out to this group to strengthen their coping capacities and minimise their risks of being severely affected by the next downturn. But there may be another group who may not have been eligible for HOPE currently. For example, HOPE is currently extended to couples who possess post-secondary education. Applicants with post-secondary education must not earn more than $1,000 to qualify for HOPE and the household income must not be more than $1,500 a month. This may be the group whom we feel will be able to manage and cope and have more children.

Can we study the profile of those affected by the downturn to ascertain their level of vulnerability and perhaps begin to relook at the eligibility criteria for HOPE? I am not suggesting that we expand HOPE to those with more than two children. We should keep the principle of families on HOPE to keep their families small so that they can focus their resources on providing their children with a stable and supportive environment. But I what I am suggesting is to consider extend HOPE to families who may be more vulnerable today and tomorrow –

the group that we thought were not as vulnerable previously – so that they will be able to keep their families small and not have to struggle as much and be better able to cope when the next and subsequent crises come.

Sir, I would like to continue speaking on the next learning point, specific to the Malay-Muslim community. Learning point number 3 – the Malay community, strengthening families through community efforts. Please allow me to continue my speech in Malay.

(In Malay): [For vernacular speech, please refer to Appendix A *.] Mr Speaker, the economic downturn that we are facing today has highlighted a few pertinent issues for the Malay/Muslim community. President Nathan in his Address has outlined the Government’s plan to ensure that our nation can overcome this downturn and continue progressing in a new era that is said to be uncertain. We often come across news about many workers, including Malay workers, who are directly affected by retrenchments. Just imagine the knock-on effects towards their families.

Sir, this is not the first time that we face economic difficulties, but the time may have come for our community to begin pondering on what we should do to ensure that we are more prepared to face the next downturn.

I would like to focus my speech on the aspect of family development – an institution that is important as a pillar to ensure our community’s progress. We are often reminded about the issues of dysfunctional or problematic families that continue to burden our community. The problems faced by these families are very complex, and will become more complicated as they face this economic downturn, because they usually have many family members. What should and can we do?

I feel that an important issue is to help high-risk families by providing them the skills to outline their family’s vision. What do they want for their own families after 20 years of marriage? Where can they see achievements in their careers? Have their job skills improved and thus increased their pay scale as well as their family’s source of income? Where do they see their children going to? Is it to a post-secondary institute or the university? Have they planned or will plan to provide early schooling to strengthen their children basic education?

Are family income, intellectual capability and skills enough to ensure that they can achieve this vision? If not, what can they do? If necessary, how can they balance the process of planning for the family with the resources they possess, to ensure that they can give sufficient attention to guide their children and develop their families?

These basic questions must be presented to the Malay/Muslim community so that we can together ensure stronger and more confident Malay/Muslim families, and that we can create a new generation that is successful and contributes to the nation.

Sir, the second issue is related to divorce matters, reconstituted families and the community’s role in this. I have, on a few occasions, highlighted the issue of divorce and remarriages, and its effects, before this House. Often, we find that the direct consequence of divorce is the failure of fathers to give maintenance to the children after their divorce. What complicates the problem is that the father made a decision to remarry, even though he still fails to give maintenance to the children from his first marriage. This failure to do so often continues after he marries again.

Mr Speaker, we are aware that even though they have divorced from their

partners, they are still fathers, still accountable, and must continue to provide maintenance to these children. Their role as mentors, advisers and observers should continue after divorce. Unfortunately, we find that the main reason for dysfunctional families is when these men fail to continue their roles as fathers and leaders to their children.

More importantly, what is the role of the community to ensure that our men are compelled to exercise their responsibility? If they fail to provide maintenance and special attention to their children – but they still want to remarry with the possibility of continuing to neglect their responsibilities – what then is the community’s response to them? Should the community encourage them to continue their plans to remarry? Or should we remind them of their incapability to play the roles as fathers to the children from their first marriage? I hope that this issue that I highlighted will be the starting point for the Malay/Muslim community to analyse the role of men in the social problems of our community. Also important is the role of the community members to become the catalyst that can increase the awareness of men towards their responsibilities.

*Cols. 531-534.

(In English): Sir, I came to this House in 2001 and then we were faced with the economic downturn as a result of the 911 attacks and its effects. Then, at the community level, I went through my first initiation into the world of Chinese songs. I was asked to lead in a song that was aimed to inspire my residents – the song "Ming tien hui geng hao" or "Tomorrow will be better". I shall not attempt to sing the song today but allow me to share the English translation of the chorus for fear that I would forget the Chinese lyrics. It reads:

"Sing with passion and stretch out our hands Let us embrace our dreams

Let us come together with sincerity Let us smile with pride Let us look forward to a better tomorrow".

I believe this song will continue to be relevant now and as we face subsequent downturns, we must believe that the next day can and will be better. Even more so, if we reflect on our experiences today, learn from it, work together with our hearts and minds, the people and the Government, towards a common dream and a common destiny.

Mr Speaker, Sir, "ming tien yi ding hui geng hao". I support the motion.

1.47 pm

Sir, Singapore's destiny is tied to the destiny of the big countries because of its small size. Singapore is like a sampan, floating in the sea. When the tide comes up, the sampan will rise, and when the tide goes out, the sampan will sink with the ebbing tide. This makes Singapore vulnerable to what is happening in the world. Singapore must always be alert and be on its toes for the tide can suddenly change and good opportunities come our way and we can reap the investments that are available. Singapore, therefore, must maintain a good infrastructure, governed by a strong and efficient democratic government, checked by a strong Opposition. It will make sure that the Government not be allowed to degenerate into an authoritarian one.

The political system must be changed to give maximum representation that will strengthen our society and our lives. The present GRC system must be abolished. If it is not possible, then it must be modified by its present size of five or six to two-member GRCs, comprising one ethnic Member and one Chinese Member,

and the two-member GRCs be limited to 20. Going by the present number of parliamentary seats, there are 40 single-seat constituencies now. Bigger GRCs are not needed because a two-member GRC can produce the optimal number of the minority race MPs while maximising meritocracy in Singapore's electoral system.

There must be free and plausible media where more news of the Opposition is allowed. This also includes activities of the two incumbent Opposition MPs. The views of the Opposition must be heard by the public. This is in line with the changed world. America has, for the first time, elected a black-African American to be its President. Political system must evolve with the times.

To meet the challenges of India and China, to protect ourselves against protectionism, Singapore must take concerted efforts to embrace Malaysia. We must aim to have an economic union with Malaysia. With a total population of about 27 million between the two countries, we can build an internal market of our own. This, to a certain extent, enables us to fight protectionism.

In his speech, the President said, amongst other things, "we must have social cohesion". Social cohesion is about arousing the emotions of people to feel a sense of togetherness, unity and closeness, but Government policies do not reflect this, especially in regard to Opposition MPs. We practise one country, two-system policy in regard to CIPC funding for community works and no proper amenities to all the MPs although they are legitimately elected.

Lastly, in order to have gracious living, we must inculcate good values to our young ones by teaching them to have humility, compassion and kindness.

1.52 pm

Mr Speaker, Sir, thank you for allowing me to speak on the motion.

Sir, speaking only two months after the Budget Statement, speaks volumes about how an extraordinary budget for extraordinary times, can be quite extraordinary. One might ask, why the need to prorogue Parliament. Uniquely Singapore, perhaps? But more than that, Sir, it is an important signal about the continuing challenges that we have to face in these very unpredictable times.

We have always been challenged by all kinds of problems and issues, from self-government, which we celebrate its 50th anniversary this June, to independence pangs, communism, racial and religious extremism, regional and international relations, and, of course, economic slowdown, to meltdown and the vagaries of economic development. Some speak of recovery in the U-shape, some the V-shape, but what the President asks for is that no matter what, we Singaporeans have to remain in the G-shape, in good shape, physically and psychologically, to face the continuing challenges. After all, we are in the midst of unpredictable times.

Mr Speaker, Sir, the President spoke of the roller-coaster ride over the last three years. But I wonder whether how many in this House have really taken a roller-coaster. Some are so huge that the sight of them alone can be very scary. For example, The Six Flags in Jacksonville in the US. Some believe that the US, the world's largest economy, was the cause of this recession and its U- or V-shaped recovery will very much depend on how the Americans tackle their problems. Meanwhile, as the President said, we cannot sit around wringing hands but instead should get our mind and body prepared for the opportunities that will

present themselves when the situation turns. If I may add, judging from the debate yesterday in Parliament, even the soul, when we discuss the kind of secularism we want for future Singapore. Here, I would like to thank Prof. Thio for remembering minor mortals like me when she eloquently presented her case about secularism with a soul in Singapore.

May I, Sir, focus on three areas raised by the President: (1) the new challenging world environment; (2) enhancing our economic competitiveness; and (3) evolving our political system.

The President's observation that the re-drawn global landscape will be less benign and predictable is worth paying attention to. With growing globalisation, and emerging economies like China and India, we need to continue to remain nimble and competitive. While China and India will draw lots of attention, we must also ensure that we can take the other opportunities that are presenting themselves. By some coincidence, during the break after President's Address, the Prime Minister of Malaysia, Dato' Sri Najib Tun Razak and the Amir of Qatar made official visits to Singapore. This serves to remind us that there are other opportunities which we should actually do a lot more in terms of the steps that we need to take to prepare for.

I think we all know about the Middle East. We have been going there quite often with many delegations by the Prime Minister, Senior Minister Goh, Minister Mentor and many other Ministers. But Middle East is not an easy area. As opportunities get more difficult and more competitive, I think we must also ensure that we do not lose out in our race for the benefits in Middle East.

Similarly, with Malaysia, if I may cite what happened during lunch when Dato' Najib visited the Sultan Mosque. On the advice that Dato' Sri Najib wanted food which is non-oily, so somebody had

ordered Italian food for him. And, mind you, that was Friday and having lunch at Arab Street. So, when the waitress went round to Dato' Najib asking him what would he like – chicken pasta or seafood pasta – he gave a smile and said, "Briyani, please." And that is the kind of local reaction, being a Friday, having lunch at Arab Street, I thought briyani or murtabak would have been the answer. But being Singapore, we immediately reacted to it and within five to 10 minutes, we had briyani and murtabak on the table. I do not know whether we can call it "murtabak diplomacy", but I think we need to be attuned to the kind of needs that we have when we meet and look for opportunities with our neighbours, especially Malaysia and Indonesia.

The Amir of Qatar had a very short visit and he told us that, in fact, he had to rush back to Doha because President Abbas of Palestine was visiting him and also the Prime Minister of China, Mr Wen Jiabao. Now, this again reminds us that, in fact, when it comes to Middle East, they have so many suitors and if we are not nimble enough, and if we are not up to speed, I think we will also lose out in the race.

Sir, on the second point about being competitive, may I just relate my experience as Mayor of North-East CDC. When I was first appointed as Mayor of North-East CDC, it was basically with a task to promote social bonding. But before we knew it, economy started to slow down and we had to be told that, in fact, the CDCs now have to pay a lot of attention to jobs, jobs, jobs. To me, that is even more significant because what is bonding when you have your neighbours with empty stomachs? So, this experience of converting the CDCs to doing a lot more in terms of providing financial assistance and job assistance had made

the CDCs a lot more meaningful. In the process, we are also encouraging our residents, our Singaporeans, that while we provide assistance, it is only in the interim, and the more important aspect of assistance is actually to provide them with the right skills, right training and re-training and

that will promise them a longer term solution to their predicament. In that way, they do not have to actually continue to be dependent on dole-outs and financial assistance for a long time, and they can live with true dignity.

So, from jobs and bonding, what I call "JAB", we move on to "JELL" – jobs, employability and lifelong learning. We have seen, how, in fact, the CDCs have matured and played a more important role. On that note, I would like to urge the Government to give due consideration as to what kind of resources that we need to provide to the CDCs. The CDCs are now reaching out to more of the grassroots organisations and their advisors, and I think they need more resources to be able to bring about the kind of bonding and outreach that is needed on the ground. The CDCs are well placed in terms of understanding the ground better than most of the Ministries and the CDCs should be given the kind of resources they deserve.

On the final point, Sir, yes, I agree with the President that our political system is not set in stone. Change we must, and indeed we have made the changes, for example, the NCMP, the NMP and the GRC system. While we want to be true to the needs of change and times, I think we must change slowly for we do not want to lose the very fundamentals why we introduce GRCs, for example. GRCs have been able to produce the kind of inclusive participation, very multi-racial in its outlook and approach, and I think this has made the minority communities feel very much included in the whole political system of Singapore. Change we must, but change

we must not bring about a divisive political climate. We must remain inclusive and we must promote harmony.

On that note, Sir, allow me to continue, briefly, in Malay.

(In Malay): [For vernacular speech, please refer to Appendix A*.]Our political system, Mr Speaker, as the President has said, is not cast in stone. It needs to change with the times and current needs, just as we have introduced the NCMP system, the NMP system and also the system where there are GRCs. Through this GRC system, we have ensured the representation and participation of the minority communities in our Parliament. This also ensures that our party-based political system can be carried out with a multi-racial tone and basis.

In the context of a plural, multi-cultural and multi-religious Singapore, a multi-racial political system must be preserved, and even strengthened. So, any changes that the Government is expected to bring, we must ensure that it will not divide the people and, in fact, will bring about a more inclusive situation where our harmonious way of life will continue.

However, the issue of political change must also be seen in the context of how to ensure that we stay competitive, so that the Singaporeans who are left behind in terms of education and skills can continue to be given attention, and they can sharpen their competitiveness in order to close the income gap that can now become a problem. As the President has said, when we take advantage of the existing opportunities through globalisation, we must also pay attention to the fact that these new opportunities should not result in a wide income gap. This challenge or problem, if not given due attention, will result in harmony problems, or the lack of harmony, or even divide the population.

So, while we improve our particular political system, we must also ensure that we continue to close the income gap. Competition and education must continue to be our main approach. This is especially important to the Malay-Muslim community which has long been left behind. Although for some time they have shown competitiveness and increasingly good performance, there are still a lot to chase and to work for. This is to ensure that the Malay-Muslim community’s competitiveness level and ability can be utilised to close the gaps in income and standards of living.

With that, Mr Speaker, I support the motion.

*Cols. 535-536.

2.06 pm

Sir, I rise in support of the motion and to join my colleagues in thanking the President for his Address at the Opening of Parliament.

The global economic recession brought on by the financial crisis has not spared Singapore. We are now seeing one of the worst contractions in our economy. There is much anxiety as the people ponder on what the future will hold for them. Will there be jobs for them? Can they continue to enjoy the same quality of life as they know it? Will there still be a future for their children and their future generation? Whatever the concerns, this recession reminds us how vulnerable we are and how pressing is the task of ensuring that our economy is sufficiently robust to withstand the volatility and the cyclical nature of the economy.

The President in his Address has touched on a very basic and fundamental concern of many Singaporeans. How do we ensure that we will be able to find new opportunities that will help continue the growth of the economy to give the good life for all Singaporeans?

Much has been said of the strategies that the Government has adopted in ensuring our future economic well-being. There are broadly two approaches to this, and I will call it the "High" and the "Low" level approaches.

At the level of "high investments", we continue to rely on agencies like the GIC and Temasek to look for investment opportunities that will give us reasonable returns on our investments. Both GIC and Temasek have been in the news recently and unfortunately for the wrong reasons. No doubt there will be much that will be said in the course of time about the relative losses, although I would like to add at this moment that with investments it is easier to criticise with the benefit of hindsight. This however, Sir, should not deter us from continuing to look for good companies to take significant stakes, particularly if we decide that holding it for the longer term would give us better returns on our money.

Sir, while I support the approach of our Government in regard to holding investments for the longer term, I am not sure if we should not place more emphasis on how we can make better use of our investments to work harder for us. Now, let me explain. The Government has regularly stated that as a sovereign wealth fund investor, it is in most cases a passive investor. In many of its investments, the Government does not ask for board representation, but would be happy to keep its substantial shareholder status while leaving the company to the care of the managers. This is a pity really. We could have used our significant share advantage to provide training and exposure opportunities to Singaporeans.

One of the many challenges of being a small country is the lack of opportunity for Singaporeans to find the opportunity to compete on the world stage. We are

talking about exposure to corporate planning and decision making at a higher level and in a completely different cultural environment. Few Singaporeans make it to this realm of seniority, and to those who make it are often celebrated as local heroes. Allowing more Singaporeans to participate at such senior levels, and I should add, not necessarily as employees but even as interns as well, would give more Singaporeans the occasion to build up their confidence and their capabilities and, in the longer term, bring our managerial skill-sets to international blue chip standards. It is often said, and I believe this to be true, that Singaporeans are, by and large, well educated and bright. However, their vision of the world is often constrained in the same manner as the proverbial frog that sees the world from the depth of the well. Given the right opportunity and environment, I am sure we will find more Singaporeans taking their companies from being third rate to first.

Our significant stake in foreign companies may also be used to provide opportunities for our small and medium enterprises to work with these companies. As with managers, our entrepreneurs do not have the opportunity or the know-how to partner with these enterprises to grow their businesses. However, if our Government can be a trail blazer, a path may be opened up for them to confidently take the plunge by going into new areas with foreign partners who can now guide and work with them.

As a simple illustration, a significant investment in, say, a pharmaceutical company should help to open the way to local companies that provide laboratory services to work with these companies. The support need not be confined to the operations of the pharmaceutical company in Singapore alone, but any where else in the world where our local laboratory can effectively and competitively set up presence and provide the service. This

would yet be another way that we can provide opportunities for local industries to grow. Additionally, opportunities may also be opened up for collaboration in areas such as joint marketing, research and development. Singapore provides a strong educational foundation for its people. With an anticipated 30% of the student cohort going into tertiary education, there would be sufficient talent for local enterprises to engage in more research and development and to work with foreign multi-national companies to advance the frontiers of knowledge. Again, leveraging on our Government’s investments overseas, we would be able to use these investments to help local SMEs to ride on the bandwagon of world-class companies to succeed in the international arena. I often wondered if Creative Technology had had the benefit of working with a company like Apple in the area of branding and value proposition, the battle for MP3 might have had a different outcome.

There is, therefore, a recognisable need for our Government when investing its sovereign wealth fund to consider a broader canvass beyond returns on investment and look at how it can further enhance its strategic value by using it to benefit the Singaporean managers and enterprises.

Going beyond, the Government can assist local enterprises further by deepening the partnership with the SMEs in its overseas ventures. To be sure, the Government is already doing this through IE Singapore, A*STAR, and SPRING Singapore, and the like. However, the question is whether more can be done and in what areas. Sir, I believe more can be done, and in certain key strategic areas. I shall name two for now.

First, our Government is at the moment helping our local enterprises break into new markets such as Latin

America, Eastern Europe and Africa, to name a few. These are new markets that will present new and exciting opportunities for our local entrepreneurs to do business. Just the other day, I was having a conversation with Olivia Lum of Hyflux. She told me that although the general economic climate has not improved very much, she is, however, receiving steady and strong orders from Africa where Hyflux also operates. These are orders from countries that have natural resources, particularly oil, and are prepared to spend to improve its infrastructure during this time. I do believe that our Government tries to bring local businesses along with them when a Minister makes official trips overseas. It is, however, one thing to bring them along to make a casual introduction, and another to work with local businesses on how they can effectively seal relationships with local businessmen to ensure the smooth passage of investment in these foreign territories. How far should IE Singapore go in providing assistance to the SMEs in finding the right foreign partner? We know that, with a strong local partner, the chances of succeeding in a foreign venture would be that much higher.

Secondly, as we move into a higher economic gear, we can no longer rely on traditional manufacturing to ensure our long-term survival. Knowledge and intellectual property are going to be the key to ensure that we can continue to charge a premium for our goods and services and to enable us to stay competitive. The Americans have been leading on research and like them, we must leverage on technology to remain competitive. However, as a small country with a small population base, we must be realistic about our ability to come up with original and inventive ideas. What we cannot achieve by sheer ingenuity and ability of our population, we can achieve by looking to the world to acquire these rights. Presently, the Government has

done much to provide the incentives and encouragement to our local innovators to not only register their patents but also to help take these patents from being ideas to commercial exploitation. On the other hand, there is more that the Government can do. For example, the Government can help local enterprises by working with them to discover intellectual property rights elsewhere and partnering these enterprises to acquire and own these rights or securing a longer term licence that will enable them to fully exploit these patents commercially. In doing so, the SMEs can widen the intellectual property pool that they can use to increase their chances of success.

Sir, we constantly bemoan the fact that we do not have land and resources to meet even the most basic of our needs.

In today’s globalised economy, the lack of resources in Singapore need not be a limiting factor. We should exploit opportunities for resource ownership elsewhere to help expand and improve on our capacities. Intellectual property rights that I just mentioned are but one example. Land is another. Just think of the possibilities that acquiring more land overseas will do to our relative insecurity over food supply. If our Government could provide funding and create opportunities for Singapore SMEs to own and operate farms overseas on a big scale and use these farms to channel their produce specifically to the Singapore market, it will give Singaporeans the much needed assurance of a constant supply of food, particularly in view of the recent experience of the relative lack of supply of rice following the sharp price increases.

Economic progress and prosperity will not mean much to our country if we are not able to maintain our social cohesion. That ours is a fragile democracy of many interest groups is a constant reminder to all of us to be mindful of the need to

preserve our national unity through civil discourse and mutual respect of views, even if those are not necessarily shared by all. More importantly, our social cohesion must also be founded on the key values that our society has come to embrace; values that define who we are and what we stand for as a people.

The recent incident involving the takeover of AWARE by a group of concerned Singaporeans demonstrates just how fragile our society is. For a brief period of time, our nation was on the boil. What turned out to be a relatively simple and lawful act of democracy suddenly turned into a deeply polarised and heated debate between the Christian Right and the homosexual and lesbian interest groups. The spotlight was quick to focus on a few key groups, rightly or wrongly – namely, the Church, as seen to be represented by the supposed usurpers; the old leadership who were seen to champion the rights of the homosexuals and the lesbians in Singapore; the Ministry of Education who denied knowledge of the instructor’s manual on Comprehensive Sexual Education (CSE) in schools run by AWARE; and, of course, the press.

Sir, I do not intend to go into the rights and wrongs of the way in which a group of concerned ladies decided to take over the leadership of a voluntary welfare organisation, save to say that I find it odd that democracy suddenly takes on a very different meaning when a group of new members decide to legitimately contest in an election to determine a new agenda. I also find it odd that many of the members who did not bother even to attend the most important meeting in the year to elect a new leadership should now decide to raise a howl of protest after the event. If they, meaning the old members, were that concerned in the first place, I believe they should have taken a more active role in the affairs of the organisation. Perhaps, AWARE should have been more selective of its membership. The question

of who should be given the right to vote has deep philosophical implications that would be applicable not only to AWARE, but philosophical implications for Singapore as well.

Of the few protagonists involved in the saga, I would like to mention the role of the press in reporting this spat. One self-evident condition of a free press in a democracy is the need to be responsible, impartial and to present the facts as neutrally and objectively to the readers as possible. One wonders whether the press can be truly called upon to discharge that duty when some of its own members feel rather passionately about the issues in the public domain. The recent saga surrounding AWARE is but one example. I will quote one email that I received from one Ms Cheryl Ng. I must add that I do not know Ms Ng and I have not verified the substance of her email. However, I would say that I would not be surprised if it were true and would be very concerned if it is. Her email reads:

"I'm also surprised and deeply troubled that the reporting in the Straits Times has not been honest in presenting the full picture to the public, especially concerned parents following the AWARE saga. There was a concerted effort by both the press and TV coverage not to mention the significant presence of the homosexual community. If I had not been there, I would never have known the truth.

In fact, I witnessed the main reporter responsible for blowing up the whole AWARE story ... hobnobbing with the homosexual fraternity at the EGM.

Some members of the press and TV were candidly jubilant as they celebrated the passing of the 'no confidence' vote by punching their fists in the air and hugging the 'old guard' they were standing with.

In the sweep of fervent support, the constitutional amendments were also made to allow men and foreign women full voting rights

(in a local women's association that makes the CEDAW report on the state of women in Singapore). In the perspective that such an amendment was thrown out in the previous AGM, the motives may be called into question. The press made no mention of this important development.

I question the cover-up in the press. In review of newspaper coverage of AWARE developments, I'm also beginning to think that press focus on the sensitive issues of religious involvement was but a calculated red herring thrown out to manipulate public sentiments.

Sir, I am pleading for the authorities to look into this matter as I am becoming increasingly alarmed that minority groups with a political agenda may not have just reached its grasp into a vulnerable women's group, and through it attempt to distort our children's views on sexuality, but have actually infiltrated the press to block out news and prevent the public from accessing the truth. I actually feel frightened that the press in Singapore can attempt to shape my views as it wishes by misinformation or partial information."

The accusations brought up by Ms Ng have once again raised the question of whether there should be an unregulated press. In reporting the matter, the editors and journalists could have looked at the issue as one of the conservative groups in our society taking on the liberals rather than be quick to frame this in the context of the Christian Right against the homosexuals and the lesbians. True, many of the ladies came from the same church. However, the same may be said of any group who comes from any organisation. But that alone does not mean that they represent the organisation. I do wonder if the press would have been so quick on the take if it were women from another faith who took up the cause instead. It is unfortunate that by framing this episode as one that carries a religious undertone, the whole debate deeply polarised our society very quickly.

Apart from the press, the Ministry of Education in the early days of the AWARE leadership struggle had maintained consistently that they did not look into this matter as no complaint was made by any parent. Not surprisingly, what followed was a deluge of complaints from parents which then prompted an investigation by the Ministry. The outcome was an implicit acceptance of the serious nature of the allegations against the CSE programmes run by AWARE. I am grateful to note the Ministry has now tightened the procedures on the appointment of course providers in the area of sexuality education.

The AWARE saga is as much about the kind of values we want to promote in our society as it is about leadership struggle. To build a socially cohesive society, all interest groups must recognise and accept the fundamental building blocks of our society that have come to represent our values on families and relationships. Our values change, if at all, by evolution than by revolution. Aggressive proselytisation by fringe groups, whether carried out by insidious means or otherwise, will only invite a backlash from mainstream society. This is not how our society should be run. Social cohesion requires the active participation of all. In this particular episode, one wonders if the Ministry of Education had taken a more proactive stand in the first place by being more vigilant, the leadership struggle and the ensuing polarisation of our community would not have taken place in the manner that it did. The question that some have asked is whether a formal complaint must be made from someone before the Ministry will act on a matter which it has heard about and which comes under its purview. Displaying annoyance at being dragged into the sorry saga does not help with the confidence recovery process in the aftermath.

Sir, we have done extremely well as a country over the years, and I can say with great confidence that we will continue to do well in the years to come. The President’s speech for the new session of Parliament has done much to reinforce that confidence. The question is not whether we will do well, but how much better we will do. I strongly believe that if we are able to pull together and collectively work at overcoming the challenges that lie before us, there will always be a clear blue sky with a rainbow spanning over it for Singapore.

With that, Sir, I join my colleagues in thanking the President for his speech.

2.24 pm

Mr Speaker, Sir, we meet at a historic moment. President Nathan laid out the challenges facing Singapore. A grave moment, a very grave moment, he cautioned. Economically, Singapore has never witnessed a near collapse of world trade, travel and finance of this magnitude. In Singapore’s short history, we have been confronted with all kinds of crisis but this one is perhaps the largest. Prime Minister Lee warned at the May Day Rally speech that there is no V-shaped recovery this year for Singapore. But, Sir, this crisis, however grave, however daunting, will pass. The recovery may take a long time, or it may be next year, or the year after. The recovery may be a big U, or a huge W. But in time, this crisis will be another case study in another MBA programme. The question for us is not when or if this crisis will pass, but how it will pass. Will the recovery consume us, divide us and cut into our social foundations, or will it invigorate us and make us stronger, wiser and more united? The world will move on with or without Singapore. We have to find our own way out of this quagmire.

For too long, Sir, we have been told that solutions to economic and social problems lie with the private sector, not with the Government. Bureaucracy became a dirty word in the west. Felix Rohatyn, the distinguished banker who helped saved New York City from bankruptcy in the 1970s and who later served as US ambassador to France in the 1990s said, "Americans by and large look at the government as the enemy." They do not trust governments and have no faith in the bureaucracy.

But, Sir, no sooner had the financial tsunami struck, that the same people who put down bureaucracy began to clamour for more government assistance. Even unthinkable concepts like nationalising banks became a reality. These are unusual circumstances and old rules do not apply, they say. Of course, they do. When the US was faced with a crisis last year, Americans turned up in unprecedented numbers and gave President Obama and the Democrats an endorsement which left no one in doubt what Americans wanted in a time of crisis – they wanted a strong government. The Democrats today control both ends of Pennsylvania Avenue. They control the House of Representatives, the Senate and the White House. So what happened to checks and balances, laid out by the founding fathers of America? Well, that can wait until the crisis is over. The gravest moment in American history since the Depression demands unusual solutions. Americans wanted strong leadership. America is a huge country – we call an economic aircraft carrier. Singapore, by comparison, perhaps is a missile gun boat – fast, small, lethal but nonetheless quite small. We need stronger leadership.

When a nation is confronted with a defining moment like this one, we need to go back to basics and look to solutions to form a strong government, even as we are talking in this House about evolving

the political system and moving the political furniture.

More than 2,500 years ago, Confucius saw a simple answer to a complex problem of governance and government. Confucius lived from 551 BC to 479 BC. It was a period in China known as the 春秋时代 (Chun Qiu Shi Dai ) – a period of chaos, of anarchy, towards the end of the Zhou dynasty. Confucius witnessed at close hand, poverty and hunger, war and corruption and harsh rule by power elites. Warring states were fighting each other for dominance. It was during this period that he understood what people needed most. When asked by one of his students, 子贡 (Zi Gong), what were the ingredients that would make a nation strong so that the people could be happy and contented, Confucius replied him in three phrases and eight words : 足食, 足兵, 民 信之矣 (zu shi, zu bing, min xin zhi yi).

Let me explain. He said 足食 (zu shi ), ie, the government must first provide the people with food. In our modern context, this means the government must create an environment to create jobs for the people so that they will not starve. With food, they can be happy and contented. Second, Confucius said 足兵 (zu bing ) – you need a credible military deterrence to protect your people and the assets they have created, otherwise all will be lost. And, finally, he said 民 信之矣 (min xin zhi yi) – you need to trust and work with a good government. You must have faith in this system in order to achieve social harmony and cohesion.

When this disciple, 子贡 (Zi Gong), one of the cleverer ones, asked Confucius if he had to choose two of the three, what would Confucius give up? Confucius paused for a moment and said, given no choice, he would let defence go. The country would have to risk being attacked and people would have to live in fear and insecurity. The nation and the people would be miserable. Here, Confucius was often misunderstood to have relegated

defence to a lower priority. In fact, on the contrary, as I will explain later, Confucius thought defence was very, very important.

But not satisfied, this discipline, 子贡 ( Zi Gong), asked Confucius again, what if he had to choose one of the remaining two? Confucius replied without hesitation this time, and said, "Let the food go."

The disciple was flummoxed. He understood that without defence, their lives were imperilled, but without food they would face immediate death.

Death, Confucius said, was not frightening because all mortals eventually die. What was more frightening than death was the chaos and anarchy that came if a good government failed because people do not have faith in it. He said in these few words, 去食，自古皆有死, 民无信不立 (qu shi, zi gu jie you si, min wu xin bu li ). If the people have no faith in a good government, the country would be finished, the country would suffer chaos, shame, humiliation, poverty and indignity.

In answering the last question, Confucius made it clear that if a country was in chaos, anarchy and at war with each other, what was there to defend? Defend against the enemy would be meaningless because you are fighting among yourselves.

The failure of a good government brings serious consequences to the people, not just during theChun Qiu Shi Dai, but throughout history. The Chinese have a saying and they have gone through a long history, a few thousand years, they had through ups and downs, they had this saying,国富民强 (gou fu min qiang). If you want to have pride and dignity, you want to have your voices heard in this Parliament, outside Parliament, the media or overseas, the country must be rich and

strong. If the country is poor, the people will be weak and their voice will be meaningless.

Last week, I read that a Hollywood actor made an intemperate remark about sending for a mail order bride from the Philippines on a late night TV show. It was meant to be a joke, but you will agree it was a rather sick joke. Sadly, the host joined in and said, "When you send for a mail order bride, please send me one too." The Philippines government was indignant. The Philippines community demanded an apology. Indeed, such a racist and very insensitive remark should never have been articulated by the host and this famous Hollywood actor. A Philippines senator complained that time and time again, people humiliate Filipinos by referring them as mail order brides and each time the government must protest and not let the matter rest. So strong words indeed. But words alone are not enough.

Why do the rest of the world keep repeating these derogatory remarks, as suggested by the senator? There are many reasons. Writing in the Sunday Times, our expatriate journalist in the Ex-Pat Files, Jervina Lao, lamented that the Philippines is "a country where hardly anything works without having to grease palms, where unemployment is high, where kidnapping is a cottage industry and where the economy depends on the government sending out its people to other countries as entertainers, maids and seamen, among other things." Philippines is a thriving democracy. It has a good government, but it has a weak government.

Young Singaporeans today speak with a confident voice. Anybody can speak loudly. But will you be heard? When I was an overseas undergraduate in the early 1970s, Singapore was poor and weak. My friends and I spoke often overseas. I am not the quiet type, but we

were rarely heard. In those days, Singapore was a nameless country.

Many Australians called the Asians, Chinese in particular, "Ching Chong Chinamen". Luckily, my name was not Ching or Chong, or not even a Wong, as I will explain later. I protested. I said, "I am not from China." But they did not care. They asked me, "Where is Singapore? A province in China? Which city?" Have you heard this derogatory remark like "Two Wongs (wrongs) do not make a White (right)"? If you are Mr Wong, you are in trouble. And then when you pick up a number and say, "This is the Wong (wrong) number", or you are "Mr Wong (wrong)". These are very racist jokes that we hear everyday.

I went on a scholarship given by the Australian Government to the Singapore Government. For that, my friends and I are very grateful. My stay in Australia gave me many good memories of the beautiful country and its mostly kind people. But I came back convinced that if Singapore was poor, you and I had no dignity. You do not count. I do not count. I was convinced that we needed a strong and good Government. A good Government is necessary but not sufficient. The Government must also be strong. And this good Government must bond with the people, and the people must have faith in this system, in this Government.

Today, nobody will look down on Singaporeans because Singapore is strong and rich, and we have very credible defence force. We have plenty of food. We have satisfied all three requirements laid down by Confucius.

But what can derail us? What can bring us disaster? This economic crisis cannot set us back permanently. It is a passing thunderstorm. But if we fall prey to religious and racial bigotry, then it will be a growing cancer in our society that will never go away. Many of us see an increasing number of Singaporeans

identifying themselves with their tribes, race and religion. That, in itself, is nothing wrong but it must be seen and place in the right perspective and operated in the right environment. But I see small groups becoming self-righteous and becoming intolerant of diversity.

This intolerance may be our downfall. Singapore is a multi-racial and multi-religious secular country which has succeeded not because you and I are perhaps more clever than our neighbours or more hardworking. We have succeeded because of our system – it is a system that makes us strong and makes us rich. Our system of tolerance, meritocracy, embrace of diversity and inclusiveness is very important. Most countries with this combustible mix of population and diversity of religions fail, and fail miserably. One example is Sri Lanka. For now, we are successful. But we are still a young country. Far from improving that we are successful. Far from improving that our success in peaceful co-existence can withstand the test of time.

I remember the old Yugoslavia under the strong government of President Tito. Yugoslavia was not a utopia. It had many faults. But it was a relatively peaceful country with reasonably good economic fundamentals. Yugoslavia was the kind of a role model for the Third World. Yugoslavia showed the world how different people from different tribes, religions and ethnicity can live happily together. But we know what happened today. Yugoslavia is past tense. It is history. It is kaput. But it also destroyed the people, and it destroyed their happiness.

Singapore is a city state much smaller than many global cities. The global cities that have succeeded are those that are most progressive and dynamic. They embrace diversity and tolerance in huge doses. Two such cities come to my mind

immediately – New York City and London. In London, where I used to live, nobody needs to feel like he or she is an alien or a weirdo. There is a sanctuary for everybody. There is space for everybody to wander, explore, speak and differ. This is the kind of tolerant and diverse society that we should aim to be.

While we focus our energies on solving this economic crisis, Sir, we should never lose sight of the longer term challenge of building a tolerant, diverse and inclusive social infrastructure where everybody has a private space within the bigger common space and, most of all, we must have faith in the good Government, a strong Government.

2.38 pm

Mr Speaker, Sir, thank you for allowing me to speak.

This year's debate is taking place in such contrasting circumstances to when I first heard the President's Address in the House in 2005. The rains have come, and it is pouring so hard we have had to dip into our reserves. If only our economy could be like the weather recently – hot like the Devil's Curry my grandmother used to make. It will take a while before we get clear blue skies, but I do think we can still hope for a little sunshine through the clouds. What is needed is for Singaporeans and the Government to all pull together. And one of the best ways to build a more cohesive society is through volunteerism. I said this when I gave my maiden speech in Parliament and, now, more than ever I believe it holds true. For example, I see it in this project called "Bag O' Sunshine", started by the Kebun Baru Youth Executive Committee, where I am a member. Every few months, we work with Ang Mo Kio Family Service Centre to take dis-

advantaged residents out on excursions. At every outing, we invite volunteers to help out. And at every outing, I see how bonds are built at all levels of society – volunteers from different walks of life, young and old, rich and poor, corporate partners and social workers. I hope the Singapore Cares programme, to be implemented by MCYS, will build more of such bonds across the country.

In these difficult times, Singapore also needs more help from those who can afford to give more. VWOs will have more work on their plate, and they will have to find innovative ways to raise funds. When they do, I hope Singaporeans respond warmly. If we take a long-term view, what is needed is to encourage younger Singaporeans to contribute as well, because if the young get hooked on giving, it will become second nature to them in time. So it does not matter if their donations start small. Every little bit counts, and the bits should grow bigger over the years. For its part, MCYS has said that Family Service Centres (FSCs) will receive more resources to improve their service delivery. I hope I can get an answer from the Ministry on how it will distribute these resources – based on need or equally across-the-board – and what sort of resources these are. During the Budget debate, I had asked about the additional $15 million to be given to Government-funded VWOs and what the money would be used for. I did not get a reply then. I hope MCYS can give an update on this VWO contingency fund – how much has been disbursed, to whom and for what purpose?

Mr Speaker, Sir, the stormy weather from this financial crisis calls for volunteerism in Singapore to grow stronger. The crisis also calls for help in the form of shelter by the Government. The effects of the recession are starting to trickle down to all sections of society. Last month, I was at Serangoon Junior College, and during a question-and-answer

session with the students, one of them asked me if I could do something about the economic crisis before I finish my term in Parliament because, and I quote, "We are all having a hard time". I promised him I would do what I could. While I still have not found the solution to the recession, I thought the most important thing I could do is to remind this House that the shelter we build must have place for every Singaporean. The Government has come up with a broad-based package to mitigate the downturn. And there has been some positive feedback. But we must always be mindful of those who are more at risk of falling behind, namely, older workers and the differently-abled.

We know it is more difficult for older workers to find employment. The Government and the labour movement have consistently cajoled employers to hire older workers, even as we consistently hear anecdotes by older workers who have been passed over for a job. Re-employment legislation is in the works, but in the meantime, the recession could cost many workers in their 50s their jobs. I would like to make two suggestions which build on current schemes and initiatives.

First, can the Government enhance the Jobs Credit Scheme for older workers by giving employers more credit for each worker above the age of 50 in their payroll? This will incentivise the employers to give due consideration to hire and retain older workers. The need for incentive when it comes to employment of older workers is a reality in Singapore. For some years now, the Government has lowered the cost of employing older workers by reducing the CPF contribution rate for employers. Re-employment legislation will also work on the norm that older workers can expect a smaller pay packet after the age of 62. Since Jobs Credit already acts as an incentive for companies to retain

Singaporean workers, can we tweak it so that we do not end up with an unduly high number of older workers bearing the brunt of the recession? After all, the Prime Minister announced on May Day a new scheme for fresh graduates to get internships, attachments and jobs – which is excellent. More can also be done for older workers.

Second, I would like to suggest that Singapore's Workforce Development Agency adapt a previous idea by NTUC, which not too long ago suggested that companies make public the age profile of their workforce. WDA should do the same for all its SPUR programmes. Given how important training and skills upgrading is currently and will continue to be, and the amount of money being spent on these efforts, greater transparency in this area can only be good and welcomed by the public. It would also give the reassurance that re-skilling is not only for those in their 30s and 40s.

Mr Speaker, Sir, we need to pull together with our older workers during these times. We also need to pull together with fellow citizens with disabilities. Every person can contribute to Singapore, and as our Paralympians showed last year, their contributions can be truly invaluable. Singapore must be as much a home for them as it is for able-bodied citizens. So, I am very encouraged that the Ministerial Committee on Ageing has reaffirmed that all HDB housing estates will be barrier-free by 2011 and that a $60 million programme to do the same for pedestrian walkways, access to MRT stations, taxi and bus shelters and public roads will be completed by next year. This goes hand-in-hand with the Ministry of Transport's move to improve accessibility and inclusiveness of the transport system. It is important that these resources are spent well, and not wasted on the wrong implementation of barrier-free access. We were told that HDB is working closely with the Town

Councils

for the Barrier-Free Accessibility Programme. The Town Councils are acting as the managing agent, presumably as they would have a much better feel of the ground and the solutions best suited for their residents. But if a barrier-free environment is truly a priority of the Ministry of National Development (MND), I would like to see greater involvement by the Ministry, if only to ensure that an area of priority for the nation is implemented correctly. It takes more than just ramps and lifts; seamless access is the only way Singapore can be transformed physically into a home for everyone. I would like to see this attitude permeate at all levels of society.

One way to ensure this becomes a reality is for MND to audit the Town Councils to see if they are carrying out the national mandate to be inclusive. If I may draw a parallel, the Ministry of Education (MOE) recently stepped in to tighten control and accountability in the engagement of external agencies for sex education, even though it had previously given autonomy to schools. Likewise, I would like to see MND raise the level of accountability of Town Councils.

I remember the President's Address in 2005 said that how Singapore treats and takes care of people with disabilities reflects the kind of society we want to be. This must continue to hold true. As we strive to get through this recession, we should remember that greater mobility for all will help us to pull together even better. I would also like to seek reassurance from MOE, which did not mention special needs students in its addendum last week, that their future remains a priority for the Government.

The final group that I would like to mention is the underprivileged and, especially during these times, those at the margins. I am heartened that the Ministry

of Community Development, Youth and Sports (MCYS) will exercise more flexibility for this group. I hope to hear more about what is being done. I am also heartened by MOE's announcement about the $68 million leg-up in Edusave and school-based financial assistance schemes. I encourage the Government to continue to facilitate opportunities, for example, exchange and immersion programmes for the less privileged. I would like to see these students continue to be given all the support they need whenever they chase their passions and pursue excellence.

I also hope we do not shy away from helping adult Singaporeans in need. While there will always be a very small group of people who will have a crutch mentality, for example, by returning time and again to the Meet-the-People Sessions, I hope this does not adversely impact those who need a simple helping hand when globalisation knocks them off kilter, as would be the case in the current recession. After all, since the Government has decided to go with the ebb and flow of globalisation, it must know that some people can get caught when the tides change suddenly. Do we not throw them a lifeline on account of the behaviour of a small group of others? A recent survey by the Institute of Policy Studies showed that Singaporeans are self-reliant for the most part and are eager to remain so. But if we do not pull to safety those truly in need, then we are pulling ourselves apart.

Mr Speaker, Sir, I have touched on the people we must keep together by our side. Now I would like to touch on the principles that we must hold on to closely as a nation, especially since Singapore is becoming more diverse, as a Straits Times commentary recently pointed out in the wake of recent events at AWARE. Yes, we are becoming a more complex society, one with more voices being heard. But we are no United States, with its 300 million population spread across a huge landmass

– a country which can drive forward regardless of the kind of interaction among the different groups in society.

Singapore can be more diverse, more complex and have more voices, but we need to reach out to each other and not work against each other when we disagree. We need to pull together, not pull apart when we want to move a debate forward in our small country. And we need to remember some of the fundamentals that have brought Singapore success. In particular, one of the cornerstones of our social cohesion has been meritocracy, which means that we advance based on merit and that Singaporeans are not denied opportunities because of certain attributes – race, language or religion as in the Singapore pledge, or essentially, who you are, where you come from, how much money you have or whether you are different. We should pull together to strengthen meritocracy and, hence, social cohesion, not weaken it. Otherwise, we are moving backward, not forward.

Our progress is not just due solely to the efforts of Singaporeans and Singaporeans alone. Foreign workers have worked together with us to build this country. But lately, it almost seems as if the only way foreign workers can work with us is if they do not work here at all because otherwise, they are working against us by competing for jobs. I sincerely hope that Singaporeans and foreign workers have not lost that ability to work together. Even if we no longer occupy the social stratum of foreign workers – which is one of immigrants striving for a better future – we should not forget that is where our parents and grandparents' generation came from.

Those are our roots and because those kind of roots were strong, we are where we are today. On Monday, some hon. Members of this House asked for some jobs to be reserved for locals. I believe in

putting Singaporeans first, but I do not think you need to do it by being protectionist. Rather than "reserve" some jobs, employers could put Singaporeans first by only hiring a foreigner after they have proven that they could not find a local for the job. This way, they are not artificially barred from hiring foreigners, even if no one here is suitable for the job. I believe the hon. Member Dr Amy Khor suggested this a few years ago in this House, but the idea was rebuffed. Perhaps it is time to look at it again?

I believe it is also time that the Government carves out a space in our financial landscape for a micro-finance institution. There is angst about foreign workers because many Singaporeans have no or very little alternative, but to compete with cheaper foreign workers for the same type of jobs. But if we give them the opportunity to set up start-ups, we are expanding the available opportunities in Singapore. These are not going to be the kind of SMEs that hope to become big brand names overseas, but small businesses that will provide a dignified and decent source of living. Their beneficiaries are not likely to be your entrepreneurial university graduates, but Singaporeans who would not normally get credit approval with the usual banks even if they have a useful skill such as baking. A micro-finance institution would certainly be useful.

Mr Speaker, Sir, as we grapple with the recession and even after the economy recovers, we must, with every policy, consider how we are adding value to citizenship and by extension, strengthening national identity. In that sense, I believe the decision to bid for the Youth Olympic Games (YOG) was a very good one, as such an event and others like it can help bring Singaporeans together. I only wish that Singapore sports could be more inclusive of people with disabilities. I did not see any mention by MCYS about developing sports for the disabled as part

of its plans and agenda in the years ahead. It is great that a buzz is building for the YOG and the Asian Youth Games. But what about the Special Olympics being held here next month, from 5th to 8th June? There are about 700 athletes taking part in nine sports such as football, badminton and swimming. They are the intellectually disabled, between the ages of eight and 40 or 50, and they come from Malaysia, Timor Leste, Indonesia, Myanmar, Brunei as well as Singapore. But there hardly has been any public support for our team and the event. We should be cheering them on.

Singaporeans and the Government can strengthen national identity if we are able to better celebrate Singapore talent, such as the Singapore Women's Everest Team. I am sure everyone is proud of them and cheers their achievement. We should never underestimate the importance of such personal tales and triumphs because the more there are, the stronger the Singapore narrative grows. One reason why we should always strive not to make policy too impersonal or rigid. For example, I had previously asked in this House about the express stream entrance criteria for the School of the Arts. I believe we will be able to nurture and celebrate a wider variety of artistic talent with a broader and more enlightened education policy.

Mr Speaker, Sir, it is significant that we are celebrating 50 years of self-governance this year. The tone of governance in Singapore has changed from one that insisted it was always right, to one that insists it will make the decisions, but after listening to the public who will then judge if those decisions were right. Nobody can insist on always being right and hope others will come onboard and pull together as one. This applies in all aspects of society. Now that we have reached 50 years of self-

governance, perhaps eventually more decisions can be devolved from Government to a wider spectrum of society.

On Monday, the hon. Member Sam Tan lamented how Singaporeans may be too mollycoddled and reliant on the Government. With due respect, perhaps Singaporeans would be less so if the political system were to be more devolved so that people are not just given a limited role to offer feedback, but instead be given a chance to actually exercise ownership and responsibility about their surroundings, their community and their country.

One good start, for example, is the work being done by Senior Minister of State Grace Fu in estate rejuvenation. In the past, there tended to be a collective sentiment that the Government saw to everything, so the only thing left for Singaporeans to do was to complain. That is why there have only been two cows in Singapore – and I apologise to Mr Speaker and the Members before saying this – "kau beh, kau bu".

But in all seriousness, as the President said, our politics and our political system has to evolve. With every passing year, we hear about the growing efforts needed to find fresh faces for political renewal. I am sure many capable, passionate, young people would like to serve their country. But if we are finding it so hard to find them, despite a more educated and diverse population, perhaps we need to allow for more diversity in Parliament and in our political system. One of the biggest challenges for Singapore will be to nurture a new generation of leaders. These future leaders have to ensure that an even more diverse Singapore will pull together, rather than pull apart, to ensure that no one is left behind and that all our talents are celebrated. If it means the ruling party has to give up a little bit of control to find these leaders, then I say that Singapore's interests would be served well.

Sir, with that, I support the motion.

(In Mandarin): [For vernacular speech, please refer to Appendix A *.] Mr Speaker, Sir, the 2008 global financial tsunami has dealt a heavy blow to Singaporeans. Whether there will be a rebound in the economy, it is still not known. Our immediate task is to help Singaporeans and businesses tide over this difficult period and survive, so that workers may keep their jobs. Only then can we help them keep their rice bowls. The problem that concerns us most is employment.

According to MOM's statistics, in 2008, there were 16,880 workers who had lost their jobs, a figure which doubled from 2007. The same statistics indicate that, of the 3,180 workers who lost their jobs in the third quarter, 70% of them had found new jobs at the end of last year. This should be attributed to the coordination between MOM and NTUC as it continues to get workers to go for skills training and, hence, we are able to achieve good results even during this difficult period.

Minister Lim Swee Say mentioned that the non-unionised companies’ order books for the second quarter are better than those of the first quarter and the number of workers retrenched would be substantially less. But, because of low margins, companies’ profits would be reduced. While the second quarter’s economic performance has been better, the worst is not over yet. Many companies are still cautious on hiring workers.

MOM announced a piece of good news – the two IRs will start hiring 45,000 workers for the next two years. The public service will also create 18,000 jobs.

Figures from the Community Development Councils (CDCs) also indicate that

up to now, there are about 20,000 vacancies of different grades at various sectors waiting to be filled. This is good news to those who are looking for jobs.

However, at my Meet-the-People session, I still see many people who complain of not having a job. They have been jobless for some time. When CDC holds job fairs, thousands of people flock to these fairs to look for suitable jobs. Most of them are middle-aged and old people. Thus, the unemployment situation is still grave. To further understand certain situations, we need to carry out an in-depth study of the problems and find suitable solutions.

The radio station 958 interviewed some bosses who employed local workers. They said that some worked for two days and left. But some of the jobless complained that bosses like to employ only foreign workers. After the interview, the employer asked them to wait for the phone call from the company; however, they waited at home but did not receive any phone call. So who is right then? The boss or the worker?

I would like to ask the Minister whether his Ministry has any comprehensive data on the jobless for all the constituencies, including their work experience and background. If no, I suggest that the MOM carry out such a survey. With this data, we will be able to know the exact number of jobless so that we can better find jobs for them. And this data will also come in handy when MPs and grassroots leaders visit the constituencies to familiarise themselves with the residents' problem and, perhaps, help them find jobs. I believe this will be a thorough way to solve the unemployment problem.

Now, let me talk about the challenges brought about by the ageing population

and the strategy that we would need to take to deal with them.

Right now, out of 12 Singaporeans, one is 65 years old and above. By 2030, the ratio will be one to five, ie, 20% of the population. If, by then, our population is five million, there will be one million who will be 65 years and above. Sir, it is imperative for us to make preparations for such eventuality. Minister Lim Boon Heng, who is in charge of policies on ageing population, has stressed that the Government has launched a number of measures. For example, HDB has installed lifts at every level of HDB flats and lift upgrading programmes will be completed by 2014. The Ministry of National Development has carried out work on barrier-free walkways for the disabled and elderly island-wide.

With regard to taking care of the physical needs of the senior citizens, we must pay attention to their mental health. To foster good mental health among elderly, we must ensure that active senior citizens have adequate space to engage in activities during the day. I have proposed in the House that to achieve optimum results, Residents' Committee (RC) should take charge of all activities for senior citizens in the precinct. The current centres for activities are not fully utilised and managed properly. Every care centre should be located near RC offices and managed by them. This is because every RC has a branch in the community to render help to the residents; it will be convenient for the residents and senior citizens to make use of such facilities.

RC is a non-profit making body without any sources of income. They are about 554 RCs currently. They can better provide services for the senior citizens. I hope that MCYS would accept the above suggestions.

As the RC is a non-profit making body without any sources of income, if they are to have more spaces for activities, they will have to pay the increased rental to HDB. The current rental of $1.30 psf, though not expensive, is a big burden to a body without any income. I, therefore, suggest that HDB charge a nominal rent only.

To encourage the elderly to carry out healthy lifestyle activities, we should encourage them to go outdoors, or visit the various places of interests. Currently, the admission charges for places of interest are too expensive for senior citizens. To encourage more senior citizens to visit such places, I suggest concessionary rates be given to senior citizens who are 60 and above, and they should be given half price. Those who are 70 years and above should enjoy free admission. This is in appreciation of the contributions that they have put in for the country. Many countries have done so and we should do the same.

Lastly, I would like to talk about our public service culture. I agree with the Deputy Prime Minister and Minister for Defence, Mr Teo Chee Hean, who is also Minister in-charge of the Civil Service. Mr Teo said that it is important for the civil servants to keep in close touch with ground concerns. In the Addendum to the President's Address, he mentioned that the focus of the public service is to keep in close touch with ground concerns, in order to formulate policies that are relevant to the needs of all Singaporeans. This will ensure that the immediate measures needed to mitigate the effects of the downturn on Singapore and Singaporeans are carried out effectively and with empathy. He stressed that public service leaders must serve the people of Singapore with integrity and empathy. In this regard, I would like to share with Members three examples. If civil servants serve with the right attitude, it will enable them to effectively manage the needs and

problems of the people and improve their service delivery to the public.

The first example is regarding multi-storey carparks. The residents of Hillview Avenue had moved to Bukit Batok West Avenue 5 because their flats were under construction. Residents parked their vehicles at the open carparks or multi-storey carparks. These residents did not face any problems parking their cars in the open carparks. However, the multi-storey carparks did not have bumper curbs or parking lot curbs. So, when they reversed their car too much, the bumper would knock onto the wall, crashing the rear lights of the vehicle. If they were not careful, and if they reversed too much, the car would hit the wall. It would cost them a few hundred dollars to repair the bumper and rear lights. In this regard, I had given feedback to the HDB engineer but the response given was that these multi-storey carparks were built according to the standards and specifications by the Land Transport Authority. They suggested that drivers should go head in when they park their cars and not reverse in. In this way, they will not knock onto the wall. They said it would be difficult to implement this suggestion. And so I invited them to come down for an on-site visit so that they could have a close look at the problem. Eventually, he accepted my suggestion and they installed a few parking lot curbs. It has been three years since we implemented the pilot project, and we received very good response from the residents. Here, I would like to thank the engineers of HDB because they have installed bumper curbs and parking lot curbs for all the carpark lots in the multi-storey carpark and the residents are very pleased about it.

Second example. From Bukit Batok MRT station to the housing estate, the walking distance is about 200 metres. I noticed that many residents like to walk on the grass patch near the MRT track. But on rainy days, the muddy ground can be very slippery. Therefore, I propose to

LTA to build a concrete pedestrian pavement near the MRT track. Similarly, it was rejected by LTA. The reason given was that under the current provisions, they do not allow construction structure of any kind near MRT tracks. Fortunately, LTA sent an officer down for an on-site visit and they also spoke to some residents to get their response. So when the HDB officer returned to his office, he put up a proposal for the building of a concrete pedestrian pavement, for the benefit of those hundreds and thousands of residents using the pavement every day. Today, residents no longer have to worry about the slippery pavement or the hot sun anymore. Mayor Amy Khor goes for jogging every morning along the pavement and she complimented that this pavement serves the residents very well and she told me, "Excellent, very good!" Thank you, Mayor.

Third example. HDB has been looking for cost-effective lifts for installation at all HDB flats so that we can serve the residents better. I happened to know that other countries have already implemented such "lift without machine room" and it helped to save 20% of the construction costs. However, when I first suggested this idea to Minister Mah Bow Tan, Minister Mah informed the HDB engineers about the idea. It was rejected. The reason was that the system is noisy and it is not suitable for Singapore. So, I invited the HDB engineers for a study visit to Shanghai so that they can understand the system better. In the end, we all realised the installation is much cheaper and faster; also, the noise is minimal. Upon returning to Singapore, they proposed to Minister Mah Bow Tan to allow the installation of "lift without machine room" for our HDB estates. This has resulted in a 20% cost-savings for us.

As you can see, the above examples showed that if the public service officers can be there on the ground to understand more about the issue; if they are creative,

if they are bold, they will be able to formulate policies that are relevant to the needs of the people and better serve the people.

Generally, civil servants will not change the policies once they are passed. I can understand this. However, we must also move with the times. Civil servants, therefore, must learn from the athletes, adopt the mentality of an athlete, ie, to constantly improve one's skills. Because once an athlete breaks the world record, he or she will look into other ways of improving his or her skills, in order to break another record.

Since Singapore gains its independence, we do not have any natural resources. In such a short period of 40 years, we have moved on from a Third World country to a modern and developed country today. Clearly, this is because we have capable leaders. Our leaders possess great foresight. They review and refine policies. We progress and we move on with the times. And that is why we managed to achieve the success we have today. Civil servants have put in a lot of hard work and contributed to our success today. So, let us work together. I believe we can continue to work with all Singaporeans to buildour nation's future.

I support the motion.

*Cols. 537-544.

3.15 pm

Mr Speaker, Sir, pundits are talking about the possibility of a lost decade that is a result of a long drawn-out financial crisis, out of which a "Grave New World" could emerge. Today, the collective sense is that we are only at the beginning of a long road we all need to undertake as a nation.

The President's key message is this is not a time to panic or resort to short-term protectionist measures, but rather to focus our energies on what has allowed Singapore to succeed globally, and let us better our competitive advantages.

I could not agree more. During the Budget debate earlier this year, I had said that we should use this financial crisis as an opportunity to review and re-look at the way we do things. After the excesses of the global financial industry over the past 10 years – that feeling of invincibility that proved fatal – let us re-focus on the basics and strengthen our fundamentals.

The crux of our strong foundation as a nation has always been, and will always be, the strength of our people – the strength of their skills – their mentality, and their will to combat challenges. On top of that we are fortunate to have strong leadership and institutions like NTUC and the CDC at the forefront in helping our workers to re-skill and upgrade them to ensure continued employability, and put retrenched workers back into employment.

Since the beginning of this year, at the CDC, we have seen the number of people seeking jobs doubled compared to last year: from an average of 400 per month last year to about 800 per month this year. The good news is that despite the downturn, there are jobs. But we are all overly challenged and have to be more prepared to work harder, because for every 50 jobs available, there are some 100 job seekers.

Ironically, the only way to combat the "Grave New World" situation is to be even more optimistic and positive. Mindset will determine whether one lands that job or not. Stay positive. Be willing to take work beyond your scope and be proactive in the search.

Allow me, Sir, to share real-life example: Mr Sng Kok Tong, 40 years old,

had worked as a futures trader for 16 years and was previously earning more than $5,000. He even brushed shoulders with famed rogue trader, Nick Leeson, who brought down the Barings Bank. Recently, at a job fair held by the CDC in March for precision and transport engineering, Mr Sng was looking for a job as a welder and a crane-driver. The father of two said: "I started from zero. There is nothing wrong with starting from zero again. I'm prepared to retrain and work shifts and weekends for my family."

Sir, I hope more will learn from his admirable example.

Mr Speaker, Sir, while workers must continue upgrading and re-skilling, companies must improve productivity by investing in capital and technology to leverage on the higher skills of our workers. In the last decade or so, we have seen the outsourcing practice becoming a common mode of operation for companies. Most gave cutting costs as their reason, others claimed those activities are not their core business. Whatever it may be, as a result, many workers now end up working for contractors who are providing services that range from manufacturing, cleaning, landscaping, security, etc. The number of contract and casual workers in Singapore has grown to more than 180,000 and it is still growing. Unfortunately, Sir, all is not well for this group of workers. On behalf of the contract and casual workers, I would like to call upon the service buyers to be more vigilant and involved when they outsource their contracts.

Recently, it was reported on 14th May that seven employers were charged for employment violations, which included unauthorised salary reductions, excessive working hours and failure to provide statutory employment benefits. Besides these seven, another 17 were also charged for similar offences earlier and are

awaiting for court mentions. Some of them will only pay up after multiple interventions by the authorities. During our interactions with workers, we do come across bad practices of employers. Often, the workers earn low wages and are lowly educated. They do not know their rights and are afraid to come forward for fear of losing their jobs. In this economic climate, contract workers are also hit. We are aware that companies may not see the need to renew their contracts due to low business volume. Companies are also impacted by the downturn and some have resorted to cheap sourcing as part of their cost-cutting measures.

There are many reasons why workers are short-changed. Allow me to list some of these reasons for Members' benefit:

Firstly, service providers could be in financial difficulties and may lack operating funds. Some of them have too many contracts on hand and cannot deliver quality service. They get penalised for poor performance regularly and are unable to pay up those liquidated damages.

Secondly, contracts are awarded based on the cheapest quote, and the easiest to cut cost is, of course, salaries and benefits of workers or requesting workers to work excessive hours.

Thirdly, many contract specifications do not include requirements such as requiring service providers to provide written employment contract to workers, stating working hours, salary and benefits besides the normal performance standards. Workers also do not know their terms of employment. We have seen workers' salaries remaining stagnant for many years. This is exacerbated, Sir, by the complete lack of audit or assessment on the performance of the service providers once the contract is awarded, for example, check on whether there is a

written employment contract for their workers and their working hours. Basic questions that could be asked by service buyers are: why is a particular worker working seven days per week without rest? Or why workers are not given annual leave or sick leave?

Fortunately, Sir, though these things are still happening, moving forward, we believe that all is not lost. There are ways that the situation can be improved. All relevant parties that are involved in the outsourcing phenomena must play their part and not use legalistic position to excuse themselves of their responsibilities. We feel that service buyers can help to put a stop and weed out the service providers and contractors who have been recalcitrant. Work with those with established track records because this is more sustainable and beneficial for the company in the long run. Check their background thoroughly as some of them can set up a new company under a different name. It is easy to register as a sole-proprietor and run a labour supplier business with low capital outlay. We must support genuine companies who invest in improving their operations and productivity through mechanisation to raise the productivity of workers; train their workers to increase their efficiency and, most importantly, adhere to the employment legislation and treat the workers well.

Sir, we have also engaged companies who are good employers and who have embraced and practised the Tripartite Advisory on Responsible Outsourcing. We could tell that their workers are generally happier and they can see career progression with their employers. The company is able to provide value-added services to their service providers who are willing to pay for good service. Their relationship with the service buyer is

"win-win" and both can see long-term mutual benefits in their relationship.

Though we know that such problems will continue to exist, as they say there will always be some rotten eggs, we do hope that the rest of us can do our part and be more involved when it comes to helping our fellow workers to earn a decent living for themselves and for their families.

Mr Speaker, Sir, in the grave scenario of a lost decade, resources are tight and the social safety net will become ever more strained. But more than ever, greater numbers of people will need help. It will become tempting to walk down the path of a welfare state and I am telling you this is a true pressure. Historically, key social welfare systems that defined welfare states were created in the aftermath of difficult times. The British welfare state, embodied by the National Healthcare System (NHS) was created after World War II. The US Social Security Act was part of Franklin Roosevelt's New Deal in response to the Great Depression.

At the CDC, we have begun to see the signs of the needy seeking help increased by about 40%, from 800 on the average per month in 2008 to about 1,100 per month average in 2009. Fortunately, help is available. Last year alone, Central Singapore CDC spent more than $17.6 million through national and local schemes helping some 12,000 low-income households and this in partner with the VWOs and also the social services organisations on the ground. But, Sir, continuing welfare cannot be the only answer. It is only a short-term solution. Again, we must re-visit the fundamentals:

Firstly, education. I applaud the move by Ministry of Education (MOE) to increase the amount of Edusave per child. I believe that, given the tightest squeeze on national resources, spending on education remains sacrosanct.

Secondly, we have to look at sustainability. We have seen from other countries' examples that a cradle-to-grave welfare system, of which the state is the main provider, is unsustainable. But how do we have a balance, with the growing need for assistance to low-income families who are stuck in a poverty cycle? Sir, in my view, community self-help must be the cornerstone of our framework of help for the community. We could recall, back in colonial days, when there were none or minimal help from the Government, clans, associations and religious groups filled the gap for help. Today, I hope that privileged individuals, successful businesses and foundations continue to come forward to lend a helping hand.

Thirdly, Sir, we need better coordination of deployment of resources. There need to be a more concerted effort and we need to co-opt community self-help into the larger national network of social assistance. The CDC's ComCare Local Networks (CLN) have been doing so since 2007. Today, while there are "Many Helping Hands", we hope they come forward to be more coordinated in working with the CDC so that we minimise duplication and maximise use of our resources.

Fourthly, Sir, I believe we need to promote more social innovation and entrepreneurship. Fuse commercial goals with social mission so that serving social needs becomes self-sustaining over the long run. The US is leading the way. There are some social entrepreneurs here, but Singapore is still in a very fledgling phase. More could be done to help social entrepreneurs fulfil their mission in Singapore.

Mr Speaker, Sir, though I am elated by the recent announcement of more tertiary institutions for Singaporeans, I am hoping for more to be done in the pre-school sector. The early childhood sector has

seen many new developments in the recent months. These initiatives, introduced by MCYS and MOE, seek to raise the standards of the early childhood sector and enhance the accessibility and affordability of early childhood education in Singapore.

Sir, now I would like to declare my position as the Executive Secretary of the Education Services Union (ESU), an NTUC-affiliated union that represents private education industry employees. This also includes the pre-school sector. We welcome the new initiatives rolled out by the Government which would upgrade the quality of pre-school education and enhance professional status of our members of the sector. However, Sir, industry stakeholders have also raised concerns which might not be addressed in a holistic manner with the roll out of these new initiatives. Over the past few months, I had the opportunity to engage extensively with two groups of key stakeholders – pre-school teachers and operators.

Teachers were concerned, with the rising minimum qualifications for teachers set by MCYS and MOE. I can understand this because the experienced teachers without the necessary paper qualifications might be forced to leave. Others are genuinely concerned that the term that we continually use, "Childcare Centres", could undermine their role as teachers. Teachers were also concerned that the public, including parents, still perceived them as "nannies" and parents still might not view pre-school as being essential to a child's educational development. They hoped for more to be done to raise awareness of the sectors and the professional status of the pre-school teachers.

On the other hand, Sir, operators were very concerned with the shortage in supply of qualified teachers. Despite increasing student intake in Early

Childhood Diploma courses, the sector still sees higher attrition rate.

Many cited low recognition and low pay being the main reason for leaving. In addition, existing teachers without the new minimum qualifications would drop out if bridging courses are not introduced quickly. With 200 new centres targeted and estimated 2,000 job openings in childcare sector over the next five years, the sector can expect to see an acute shortage of qualified teachers in the short run.

Operators also shared the same concern as teachers with respect to the lack of public awareness of the importance of pre-school education although a child would transit from pre-school to a primary school. Pre-school teachers are as important, if not more important in the preparatory stage of a formal education compared to primary school teachers.

To this extent, we have endeavoured to work with industry partners to look into areas such as raising professionalism; improving image and pay issues; and gaining greater public recognition of pre-school teachers' work. This would complement the nation's effort in raising standards and help attract and retain entrants into the sector.

At the same time, a workgroup comprising of representatives from ESU, MCYS, MOE, WDA, e2i and other industry players was formed recently to look into the issues that I have mentioned earlier. The workgroup's immediate priority is to raise the profile of the sector to encourage new entrants such as PMETs who were out-placed to enter the sector.

We believe, Sir, that with better qualifications, the teachers' value adds to the sector and, in turn, parents do not feel

short-changed when centres raise fees to cover the increase in teachers' salaries in the future.

I would like to call for greater support from the Government to raise the profile of the pre-school sector and for more recognition of the contribution of the pre-school teachers and that all stakeholders view and treasure them as Pre-school Professional.

Competition amongst different interests for limited resources will be brought more starkly into relief during difficult times. We must prevent stresses on our social fabric by appreciating one another more during these times. We must learn to accept, even embrace, our differences – be they national, race, religious, or upbringing – as they make Singapore a unique multi-cultural society. By all means, hold on to our beliefs and our views, but respect the fact that not everyone or everybody will share them. We must learn to agree to disagree.

We must also be more welcoming to our foreign friends, Permanent Residents and new citizens. They are not here to steal our jobs but, instead, to make an honest living and contribute back to Singapore.

We should also, Sir, smile more, be gracious, I think we are too serious sometimes. We could all use some uplifting during these difficult times.

I know that some workers may have to experience temporary layoff, but we could always look at the positive angle, those mandatory unpaid leave or temporary layoff, could be a blessing in disguise to spend more time with your family and friends and reconnect.

In conclusion, Sir, I would like to thank the President for his speech. He spoke about maintaining our economic competitiveness; strengthen social cohesion, focus on the importance of

education, amongst others. It is now every Singaporean's duty – in your capacity as husbands and wives, fathers and mothers, workers and employers, leaders of organisations – to figure out exactly how we as individuals can help to build Singapore's future in an uncertain world, as that the next decade become not a lost one because Singapore, as a country, is always looking forward to work harder and to achieve even more in the next decade.

Order. I propose to take the break now. I suspend the Sitting and will take the Chair again at 4.00 pm.

Sitting accordingly suspended

at 3.36 pm until 4.00 pm.

Sitting resumed at 4.00 pm

Debate resumed.

Mr Deputy Speaker, Sir, I support the motion standing in the name of the Member for Pasir Ris-Punggol GRC, Mr Michael Palmer, to thank the President for his Address.

In the first global "stress test" performed by Swiss business school, International Institute for Management Development (IMD), Singapore was ranked second, after Denmark, to be among the best prepared to withstand the economic stresses of a recession. At second, out of 57 nations surveyed, we are deemed to be well-placed to weather the financial crisis and improve our competitiveness after we emerge from it. However, the President's Address underscored the fact that the global

environment is capricious and that we can ill afford to be caught wrong footed to our economy's detriment. I agree and wish to speak about four main points arising from the direction the President set in his Address.

First, jobs. The President stated, "We must keep up the effort to up-skill and re-skill our workers to become more employable and productive, in a changing economy" and that "NTUC is at the forefront of these efforts, working shoulder to shoulder with Government and employers." It is against this backdrop that I wish to discuss the Skills Programme for Upgrading and Resilience (SPUR) programme, the 18,000 public sector jobs the Government will release into the labour market and the need to tweak and fine-tune the Workfare Income Supplement (WIS) Scheme. An article on 20th May 2009 in the Business Times reported that according to the latest Kelly Global Workforce Index, five out of six local professionals believe they could become irrelevant if their skills are not upgraded within the next five years. Workers are more pressed than ever in the present age to keep upgrading their skills. The Government's willingness to drive and sponsor this is the right move.

Therefore, I address now – SPUR. It is heartening to note that as at the end of March 2009, SPUR, which was launched last December, has seen 90,000 workers sign up for it. However, I understand that the jobs bank at the Employment and Employability Institute (e2i) and Community Development Councils (CDCs) still has over 20,000 vacancies. In 2008, 16,880 workers were made redundant. May I ask the Government where does the mismatch lie? Is it industry-based? Do we have an update on how many of the unemployed who have undergone SPUR training have, in fact, found jobs following retrenchment? Next, the 18,000 public sector jobs. The Government announced in Budget

2009 that it would be making available 18,000 public sector jobs over the next two years. How many of these 18,000 jobs have been taken up? How many people have applied so far? And how successful have the advertising campaigns been to generate a good response to these recruitment drives? I ask these questions because I have met constituents in my constituency, Ulu Pandan, who have the requisite skills to serve well in Government jobs, but are still unaware of the Government's recruitment drives.

Next, WIS. Currently, if a worker's monthly income is less than $1,500 and he is above 35-years old, he will receive the WIS from the Government. WIS was introduced to encourage an increased rate of employment and to signal to Singaporeans that the Government will, where employment policy is concerned, walk shoulder-to-shoulder with Singaporeans if they make the effort to work. Therefore, we should reward those who work harder. On this note, why not offer WIS to workers who have a basic salary of $1,500 or less, even if their over-time pay tilts their monthly pay cheque to beyond $1,500? This way, to echo my fellow Member of Parliament, Mdm Halimah Yacob, we will not be discouraging the diligent workers from working hard. The Government would have to pay WIS based on $1,500 and not on the accumulative figure of basic salary plus overtime pay. Where is the harm in that?

Next, I would like to discuss issues relating to national security. The President had stated, "Mas Selamat's recapture is not the end of the terrorism threat." And in a later part of the Address, the President stated, "Maintaining a safe and secure Singapore is a basic pre-condition for our people to pursue their dreams." With these two statements in mind, I would like to compliment the Home Team

and Internal Security Department (ISD), in particular, for playing an active role in the recapture of Mas Selamat. It has been a trying and difficult year for ISD, but its resilience has paid off. To me, ISD's perseverance in tracking down Mas Selamat displayed true tenacity. They overcame adversity. Indeed, MHA's own statement in the addendum to the President's Address sums up the ever changing parameters in the anti-terrorism business and I quote:

"How we achieve safety and security will change over time as our operating realities and society change. The operating environment today is complex and challenging."

Therefore, the recapture of escaped terrorist leader, Mas Selamat, has set many minds at ease. Nonetheless, the question on the top of many Singaporean minds is how he managed to cross our border with Malaysia? Consequently, Singaporeans are concerned about the fact that he may have had sympathisers in Singapore who helped him travel to Malaysia. It is encouraging that the security forces of regional countries, in particular ISD and the Malaysian Special Branch, continue to work closely together to combat the threat of terrorism. In the case of Mas Selamat, the cooperation has borne fruit. When the time is appropriate, I hope the Minister for Home Affairs will answer the questions on the minds of many Singaporeans, ie, how he escaped, whether there were JI sympathisers who helped him and, if so, how many? Now that he has been recaptured, how should we deal with him, going forward? What measures do we have in place to prevent a repeat of such an incident?

The third point I would like to address is the issue of the prevalence of loanshark attacks in Singapore. The President had stated in his speech: "Challenging times will put stresses on our society and our families, but we must manage these stresses and meet the challenges as one

people." One stress line is the rising debt owed to loansharks. On 22nd May 2009, the Straits Times reported:

"Sales of CCTV cameras, alarms jump - More residents fear crime, loan sharks."

I quote from the article:

"Police also received nearly 4,000 complaints of loanshark harassment ... in the first three months of this year, up from 2,066 complaints in the same period last year."

I welcome the Home Affairs Minister's decision announced earlier this year to seriously consider making borrowing from illegal moneylenders a crime. Let me explain why.

In January last year, Senior Minister of State, Assoc. Prof. Ho Peng Kee, informed that there were 10,221 reported cases of unlicensed moneylending in 2006. That was a 19% increase over 2005 when there were 8,568 reported cases. Similarly, the 2005 figure represented an increase of 47%, to be exact, over 2004, which had 5,809 reported cases. Multiple initiatives were introduced by Ministry of Home Affairs (MHA) to try to solve the problem. These included:

Enhancing the penalties under the Moneylenders Act; and

The formation of the Anti-Unlicensed Moneylending (UML) Task Force to increase, among others, the number of ambush operations.

However, the figures show that these measures have not deterred loansharks syndicates. A look at the statistics for 2007 support this point. In 2007, there were 277 arrests over the first three quarters, ie, from January to September, which were just 17 short of the total number of arrests for the whole of 2006.

Thus, in the light of the unattractive figures quoted above, MHA is correct to consider taking a different strategy in tackling the very real problem of unlicensed moneylending. This involves simultaneously tackling the supply of and the demand for illegal loans. Currently, the law, called the Moneylenders Act, curbs UML only by deterring the supply of illegal loans into the market. It does nothing to penalise or deter the borrowing, ie, the demand side. This is clear from sections 8(1)(b) and (c) of the Moneylenders Act. The offences in these sections do not deter the demand for illegal loans. Introducing a new section which makes it an offence if a person secures a loan for himself or on behalf of any other person from an unlicensed moneylender will help deter the demand. The punitive measures which come along with the offence can be calculated based on the harm that the State deems such borrowing creates and based on the level that will best deter such activities. Naturally, the Attorney-General will have the ultimate discretion whether to prosecute a borrower, and unique circumstances prompting a compassionate approach would likely merit non-prosecution.

Examples of two prominent pieces of legislation which combat both the supply and demand elements of an offence are the Misuse of Drugs Act (MDA) and the Prevention of Corruption Act (PCA). Sections 5 to 7 of the MDA penalise the trafficking, import and export and manufacture of controlled drugs, ie, the supply of them. But, significantly, section 8 of the MDA also penalises the possession and consumption of controlled drugs, ie, the demand for them. By penalising both the demand and supply, the drugs problem in Singapore has been contained.

The second prominent piece of legislation is the Prevention of Corruption

Act (PCA). Section 5(a) of the PCA penalises the supply of corruption, and in order to effectively deter acts of corruption in Singapore, section 5(b) of the PCA penalises the demand for corruption. Thus, both the demand and supply of elements of corruption are tackled in tandem, resulting in Singapore's extremely low incidence of corruption. We should quickly use the same strategy to combat the rapid growth of unlicensed moneylending in Singapore, given that:

The anecdotal evidence that a significant number of those borrowing from loansharks are using the loan to pay off gambling debts;

As a result, innocent residents have to bear the brunt of harassment if a false residential address is given;

The whole corridor suffers the stigma of graffitied walls even if a false address is not given;

The continuing Government philosophy that if we continue to work, we will be given an incentive, such as WIS, why not make borrowing from illegal moneylenders, which causes much harm to the neighbourliness of communities, an offence?

The Attorney-General is always in a position to exercise his discretion whether or not to prosecute the borrower based on the unique mitigating factors, if any. I urge MHA to quickly implement the policy which includes a shift away from supply-centric enforcement to one which also combats the demand. This would be similar to the two-pronged enforcement action taken against drugs and corruption. Would MHA therefore provide an update of when it will introduce provisions which make borrowing from loan sharks an offence?

I move onto my fourth and last point - education and easing the load placed on teachers. The President made clear: "Education is our best investment in Singapore's future. Our education system is designed to give each and every child the best opportunity to stretch his abilities." While I fully agree, I wish to add that to achieve this, we need to give teachers the space and time to teach. During the Budget debate this year, MOE announced that it would make available close to 7,500 teaching positions and teaching support staff for our schools and tertiary institutions. Given, the high expectations placed on our teachers, a topic I have talked about in this House several times, I would like to ask the Minister for Education how many teaching support staff has MOE recruited, what its target in terms of recruitment of teaching staff is for 2009 and how near is MOE to that target.

In conclusion, Sir, our GDP is expected to decline by 6%-9% this year, with unemployment set to rise. We need to unite as a people to overcome the challenges ahead. But we should not forget that we have in the meantime a nation to keep safe, children to teach and our social fabric to protect. In supporting the motion, I trust the Government will consider the four points I raised in relation to Mas Selamat, reducing the incidence of loansharking, SPUR, WIS and the injection of 18,000 public sector jobs into the labour market and education.

Mr Deputy Speaker, Sir, thank you very much for allowing me to speak on this motion of thanks to the President. I am very happy to see such a packed House today and I am sure that Members are eagerly awaiting what I have to say.

A reporter once asked an old communist revolutionary to describe the

merits of his system. So the comrade said, "Our system is great because everyone has a job". The reporter then asked, "Well, that is wonderful. So how is your pay related to your work?" And the comrade answered, straight forward, "They pretend to pay me, I pretend to work."

Sir, this is, of course, a joke, but I think it does tell us something about how the design of political systems interplay with basic human motivations to produce outcomes for better or for worse. Singapore has come a long way since our independence; economically, socially and politically. Our strategic choices have mostly paid off and that is why we are in a better position today compared with most of the other small colonies that gained independence after the war. We have to make new strategic choices in the face of fast-changing circumstances. The Chinese saying "Bu jin ze tui", that is, "If we cannot advance, we will surely slide back" describes the difference between getting it right and getting it wrong. For today, I will focus on three areas that, in my view, have the potential to disrupt our social fabric and undermine our economic strength. These three areas are employment of older workers, treatment of lower wage contract workers and the treatment of foreign workers.

First, I will speak on the employment and the re-employment of older workers. There is now a new term in the United States and it is called, "Un-retirement". This is a phenomenon where retired workers are forced by circumstances to return to the workforce to seek a living. What happened, why do they have to do that? These retirees have run out of savings, or lost their savings to stock market plunges. They have also seen the value of their homes collapse. "Un-retiring" is proving to be much more difficult than frustrating and sometime heart wrenching than retiring. Just

because you are broke and need money, does not mean that you would be given priorities for your job and this is especially so when the economy in itself shedding drops in the face of a recession. But then where does that leave the distraught?

And we look at the situation in Singapore. We, in Singapore are also facing our most serious recession since the war. Thankfully, we have avoided the worst outcomes in the labour market so far. Although GDP fell from 7.8% in 2007 to 1.1% in 2008 and to an expected between -6% and -9% for this year, the rise in the quarterly unemployment rate, that is as of first quarter 2009, to 3.2% overall and 4.8% for the local workforce has not been as steep. I firmly believe that this is partly because of the unemployment retarding effects of the Jobs Credit Scheme, the SPUR programme, the socially responsible company level cost cutting on the one hand, and the actual job searching, job retraining and placement efforts by entities such as the CDCs and NTUC, e2i on the other.

On the re-employment front, the number of unionised companies committed to re-employing older workers stands at 726 as at the end of April 2009. And the total number of workers in unionised companies employed beyond age 62 has also gone up from around 4,600 at the end of last year to more than 5,000 by the end of first quarter 2009. But does this mean that we need not worry about the prospects of the re-employment for older workers and does "un-retirement" hold any lessons for Singapore?

In my view, we should take very seriously the difficulties of workers attempting "un-retirement". When we studied the write-ups, we see that many of these retirees say that they are stuck because they cannot convince employers of their employability. And those who

have left work for a number of years are particularly out of touch skills-wise, and also through a lack of confidence. Others are ruled out because of the healthcare cost that prospective employers do not want to shoulder and, yet, others rule themselves out because they continue to look for work in sectors and at terms that they were used to but which are no longer realistic.

Although these kinds of descriptions are coming out of the US, these descriptions are not unfamiliar to us. If you try to remedy these problems and close the gaps quickly for large numbers in a moment of crisis, it would be a most difficult challenge for any country to tackle. The key lesson is that we must do our best not to end up in that situation, as far as possible. And that is by going upstream and helping as many of our workers stay employed and employable for as long as possible. Hence, our efforts in the area of re-employing older workers must not slacken, even in the face of the downturn.

To be realistic, we must expect that it would not be easy securing re-employment in the downturn and the numbers that I shared just now, they do not say they are easy, they just prove that the extra effort that I have to go into in entrenching the practice of re-employment in companies and certainly within the unionised sector through our unions.

And we must also recognise that the alternative to being able to implement re-employment systematically would be a growing pool of financially strapped old citizens and that is something which is much worse for the individuals and for the countries as a whole. And here, I would like to call attention to two observations. Firstly, in recent days, we hear of media reports of green shoots of economic recovery in the US and then perhaps

globally. This is more on the basis of the sudden exuberant stock market behaviour. Whether this exuberance has a firm basis in the real economy or is irrational remains to be seen. But we must not let this stalk of green shoots distract us from investing time and effort in the upgrading of our workers skills and employability because we are dealing with a structural issue and not a cyclical one.

The recovery, when it comes, will require Singapore companies to compete ever more fiercely with the survivors of the global shake-out. These survivors are the fittest of the lot and the need for the Singaporean worker to be, not only job ready, but fighting fit, cannot be overstated. Older workers would have to secure the employment through the value that they create at work just like everyone else. They must actively improve their job worth and employment chances through upskilling.

The second observation I would like to make here is, with regard to the ageing of the baby boomers and the first batch, that is those born in 1946, have just aged passed 62, which means to say that the rest of the boom are just coming through. And that means that the number of workers reaching 62 will swell in the coming years before reaching a peak. Companies will have to step up their efforts to design and match suitable jobs to their older workers in anticipation of the growing numbers of positions needed, year after year.

The expected enactment of the Rule of Employment Law in 2012 will make this requirement mandatory. And the choice facing companies is one of turning this requirement either into a value add or into a cost burden.

With the enactment of the re-employment law getting closer each day, I hope that companies will make maximum effort to prepare themselves for

it and not leave it to the last moment or hope to arrive shipshape by muddling through. I also hope that companies will not resort too ready to outplacement or to converting their ageing workers to contract service before retirement age as ways to side step the need.

I say this because I note that the percentage of our resident workforce that is on term contracts has continued to rise. Between 2007 and 2008, it grew by 4.9% to 189,000 workers and now comprise 12.4% of the total resident workforce. And on the subject of contract workers, I want to particularly speak about the situation faced by lower wage contract workers, and of the danger of facing them and that is of cheap sourcing and the impact of that on the economy as a whole and as well as on the earnings, employability and productivity of the workers. Instead of being value conscious and productivity conscious, I think still too much emphasis is placed by too many companies on price consciousness alone. And this has contributed partly to the decline in labour productivity. Even if one takes into account the intentional move to kick down unemployment in this recession, the trend for labour productivity has still been adverse in recent quarters. Now why is this so?

For a long time, the argument has been that, for the sake of economic competitiveness, cheaper labour is one way for companies to keep down the cost. The upshot of this way of thinking is to bring in cheaper foreign labour and to outsource at lower rates. There are two problems with this. The first is the race-to-the-bottom challenge where cheap sourcing would tend to drive down the earnings, especially of lower wage workers. Workfare payments go some way towards topping up the income of local lower wage workers and lowering the chances of their being sucked into the downward spiral, but only to a point. The cheap sourcing mentality among buyers

and which fellow Member, Mr Zainudin, has elaborated earlier, gives rise to a lowest quote mentality among suppliers of goods and services and the ensuing cut-throat competition will press down wages over time.

The second problem with accepting this argument too readily is that there would be little motivation on the part of companies to think about raising competitiveness through raising productivity. Water flows towards the lower level. When there is a simpler solution for the immediate, then the important is sacrificed at the altar of the expedient and this will reap greater damage on the economy, even though short-term gains may be reaped. To survive the downturn, we have indeed to cut cost and save jobs. But, to prosper in the upturn, we cannot hope to be competitive just by being cheaper than others in our inputs, we must be more value-for-money and more productive than others. And this means that we have to carefully consider the following:

Firstly, that with outsourcing and contract service becoming ever more commonplace and with many companies pursuing these approaches as ways to save money and increase flexibility, how do we ensure that the growing pool of contract and freelance workers across different industries do not become less and less employable and more and more vulnerable to cheap sourcing?

Many contract workers also work outside the boundaries of companies. Their needs would increasingly have to be met beyond measures targeted at companies and this applies not only to lower wage workers, but also increasingly to PMETs who freelance or who are on contracts for service. I want to underline this point that more solutions in the future would have to come from measures and arrangements that are not company-based. This is because more and more

companies will operate using a mix of small internal core workforce and a larger flexible external or temporary workforce. Therefore, productivity, professional development and individual employability cannot be achieved by addressing companies alone. This also means that statistics and the interpretation of statistics would have to adapt as well because the share and scale of non-company-based data will increase over time.

Next, how do we ensure that companies and organisations in Singapore that embrace outsourcing are doing so smartly, in that they are pursuing productivity enhancement in outsourcing as a way to derive value-for-money, instead of being "penny wise, pound foolish"? There are still sectors whose productivity levels have not improved much over the years and are also lacking the levels attained in other countries, and this is the nub of the problem.

NTUC's efforts in highlighting and countering cheap sourcing over the past few years have shown us how tough this problem is. I think it transcends the question of business tactic. It is a question of entrenched mindset that is very hard to dislodge and we have to find ways of cutting this Gordian knot so as to fundamentally transform our economy and the capability and worth of all in our workforce. But one thing is for sure, regardless of the transformation path that we choose to take, the Singapore economy will always need migrant workers to help fuel it.

Today, foreigners constitute 37% of the workforce. The number of foreign workers will grow in the recovery. Migrant workers bring with them the numbers, skills and energy to complement and supplement our local workforce, and at a cost that companies find viable.

While foreign talents should have less problems negotiating appropriate terms for themselves before accepting contracts, lower wage foreign workers are more prone to finding themselves at the receiving end of unequal arrangements.

More cases of such unfair, unsafe and unlawful practices have surfaced over the past months and reported in the media as the economy skidded and these are warning signs for us to take seriously. We should proactively address questions of fair treatment, for example, prompt payment of the right wages, adequate health coverage, decent accommodation, safe transportation and enforce strictly against labour suppliers and employers who flout legislation and regulations. Profits and greed cannot be allowed to override basic decency. It does Singapore's reputation and attractiveness as a working location no good to be associated with shabby treatment of migrant workers.

I would also like to point out that if such workers are not perceived to be treated properly, source countries or provinces may have cause to ban their people from coming and, thereby, damaging our economic resilience. Moreover, I believe that how employers choose to treat their foreign workers has a knock-on effect on how they treat local workers, especially those at the lower end of the economic ladder. At the same time, as the number of foreign workers here grow, we must expect that there will be increasing tendency for them to organise amongst themselves to seek their own protection and rights as well as increased actions by groups to lobby on their behalf. The more recent gatherings and group appeals at the MOM, as far as I am concerned, are not just a reflection of the downturn, I think, they are indicative of a deeper trend of behavioural change.

We should hasten to do the necessary so as not to be misconstrued as being

passive or lax, instead, we should show ourselves to be decisive, proactive and enlightened in regulation. As we focus our attention and efforts on tackling these and other emerging trends and work them to our advantage, we will strengthen ourselves against the competition while ensuring that Singapore coheres and continues to be one of best places on earth to work, live and play. In this way, we will together build our home, our future and our Singapore.

Sir, I support the motion.

Mr Deputy Speaker, Sir, may I seek your consent and the general assent of Members present to move that the proceedings on the item under discussion be exempted from the provisions of Standing Order No. 48(8) to remove the time limit in respect of the Prime Minister's speech.

I give my consent. Does the Leader of the House have the general assent of hon. Members present to so move?

indicated assent.

With the consent of Mr Deputy Speaker, and the general assent of Members present,

Question put, and agreed to.

Resolved,

That the proceedings on the item under discussion be exempted from the provisions of Standing Order No. 48(8) in respect of the Prime Minister's speech. – [Mr Mah Bow Tan].

Debate resumed.

4.30 pm

Mr Deputy Speaker, Sir, we usually prorogue and re-open Parliament midway through the term of a government. It gives us a chance to set the direction for the remainder of the term of office of the Government and to give MPs a chance to discuss important issues of the day. But this time, this prorogation and re-opening is far from a routine mid-course correction. We are proroguing in the middle of a major global crisis, which is drastically affecting Singapore.

The impact on the world economy will last for a long time, beyond the downturn and the immediate recovery. There will be major changes to global markets. There will be major changes to the business climate worldwide. But at the same time, there will be new opportunities for countries and companies, which are fast off their marks into this new world. It may be a "Grave New World" for now, as one MP said earlier, but it will be a "Brave New World" after that. Therefore, we have to set the direction for Singapore at least for the next decade. The President's speech covered the issues comprehensively. I do not intend to dwell on all of the subjects there. I will focus on just two of them: first, the long term economic transformation of our Singapore economy, and second, how we intend to evolve our political system.

The immediate measures to tackle the crisis have been taken, announced, debated and settled. We have SPUR – the training programme for workers. We have the Resilience Package, which contains, in particular, the Jobs Credit and the Special Risk-sharing Initiative as key measures. These were the major parts of

the Budget which took place in January this year. We obtained the President's approval to draw on past reserves and the House has fully debated and accepted these measures, which are now well in process of being implemented. But despite these measures, there is no getting away from the fact that this is going to be a very difficult year. Our latest growth projections are between minus 6% and minus 9%. Usually, we are used to seeing these numbers without minus signs in front of them. But this is not a joke, it is for real. It is not just Singapore but all countries that have been hit. Even large economies with big domestic markets – Germany, Japan – are expected to decline significantly this year. And even the most vibrant economies in the world – China, India – they too have seen a sharp slowdown, but will still have positive growth.

So it is obvious now, if it was not already obvious in January, that we were right to mount a decisive response in the Budget with all the resources at our disposal then, rather than to wait to see how the battle unfolded and gradually dribble in our resources bit by bit.

We have not won the war yet but we have succeeded in moderating the rise in unemployment. In the first quarter, our GDP shrank sharply, by 10%. But our unemployment rose only moderately, from 2.5% in the fourth quarter of last year to 3.2% in the first quarter of this year, much less than other countries and at the same time much less than the shrinkage in our GDP. It is something to feel relieved about but it is also something to give pause and to worry about. Because if you think about it, our output has gone down by 10%, which is way down, our unemployment has not gone down by much. That means each worker is doing 10% less work. That means employers are still holding on to the workers for now

because of SPUR, because of Jobs Credit, because of flexi-work and flexi-wage arrangements, and because they hope that if they grit their teeth and see through this sharp downturn, the business will come back and there will be work for workers and the workers will be there.

We hope that our firms will receive new orders soon and, if so, the decision to hold on to these workers through the downturn will pay off. So far, there are orders but most of the orders coming in will only see their companies through to the middle of the year and no company can tell what the third and the fourth quarters this year are going to be like. I asked the EDB, they are not sure. I asked MTI, they cannot predict. I asked the unions, who usually have their ears close to the ground, and they are equally anxious. So we are not certain that the demand which we are seeing now, with some companies doing some overtime with workers, even a little bit of hiring here and there, is sustainable. If the orders do not come, then the companies have to let more workers go because they cannot sustain short-time and job-sharing indefinitely.

Workers have to have work. You cannot have workers who are regularly off one day of the workweek, who are on short-time, or who are in the office with nothing to do. Eventually, if this situation persists, the companies have to right-size and the workers have to re-deploy into new businesses which have orders, which have better prospects and where they can become fully productive again. That is from the company's point of view. From the economy's point of view, from the Government's point of view, if we are in that situation, we have to let the companies restructure, we have to let the resources shift from the businesses which are shrinking to the businesses which are growing, and gear up for the changed new world, rather than wait in vain for the old businesses to come back.

We cannot prevent this from happening. We have to see how it unfolds but what we can do and what we have done is to have measures to save jobs in the time being, to buy time for us to make this transition. In this way, we can massage the problem away and the workers do not have to endure too much dislocation, unemployment and pain in the process. We are watching the situation very closely. All the economic agencies are alert and engaged and, if we need to, we have the resources and the will to do more.

To overcome crisis, you have to be good at crisis management, but it is not good enough to excel at crisis management. We also have to be able to strengthen ourselves during normal times and build up so that when problems come, we meet the problems in a strong position. Otherwise, we will be champion crisis managers but we will be chasing our tails without end. Therefore, we must have a sound long-term strategy for growth and development.

We have regularly reviewed and updated our longer term policies to meet changing circumstances. In fact, each time we have had a major downturn, we have had a major review. We did it in 1985 when we had Economic Committee. That was for those of you who remember, a very severe recession after more than a decade of sharp growth. We did it again in 1997, during the Asian crisis, and after 9-11 in 2001, we formed the Economic Review Committee which made many wide-ranging recommendations, most of which have been implemented. And since the Economic Review Committee, we have continued to make major policy changes over last few years.

I just cite you a few. We restructured Government revenues, cut the corporate tax progressively from 25% to 17%, raised the GST to 7% and amended the Constitution to put in place a new

framework for spending from investment returns so that we can achieve a better balance between saving for a rainy day and investing now for our future.

We invested heavily in education. We recruited and trained more teachers, which is close to the hearts of many MPs. We strengthened and re-organised our ITE into three new colleges. We built a fifth polytechnic – Republic Polytechnic. And now we are setting up two new institutions, just announced in the Addenda to the President's Address last week – Singapore Institute for Applied Technology, to open up more direct routes for polytechnic graduates to acquire degrees, and we are setting up a new public-funded university, teaming up with MIT in America and with a leading university in China. These are major initiatives.

We are developing new industries in Singapore. In high-tech, we have biomedical sciences, interactive and digital media, clean technologies, R&D beginning to take off. We are developing services industries. Financial services now hit but still with considerable potential. High-end tourism – the IRs are coming up and what EDB calls "HQ and Control Tower" activities. I know what HQs are. I asked them what "control towers" are, and they said, "Well, the command function is here. It is overseeing production in the region and managing the supply chain in the region." The production, the logistics, the financing all in different locations controlled from Singapore. We are into the "Control Tower" business.

We are getting companies from new geographies, not just Americans, Europeans or Japanese, but companies from China and India setting up in Singapore. To complement economic growth, we are also strengthening our social safety nets. We have created ComCare, which has been a life-saver for many families and a very valuable tool for

many grassroots advisors. We have the Workfare Income Supplement to help boost the incomes of those at the lowest end of the totem pole. We have improved our CPF system, raised the interest on CPF accounts, particularly for those who have less than $60,000, and introduced CPF LIFE to make sure you are looked after into your old age. We have avoided western-style welfare but still ensured that every Singaporean who makes the effort to look after himself will get help and will be looked after, and will not be left alone.

These measures have seen us through good times and bad. In good times, they have enabled our GDP to grow strongly, 7% – 8% per year, created many skilled jobs for skilled workers as well as for PMETs, raised incomes for households so that the median resident household income has gone up from $3,600 in 2003 after the previous crisis, to almost $5,000 last year. So in good times, the policies have worked. In bad times, the policies have stood us in good stead. We have a restructured economy, which is efficient and competitive. We have accumulated resources to help fund counter-recessionary measures without borrowing. We have a good reputation to attract good partners and projects, and we have got the ability and the organisation and all the plans to continue building even in a downturn. And that is how Singapore has weathered successive crises, and steadily developed and prospered.

After this crisis, the world is not going to be the same again. This is not just another cyclical downturn and recovery. The world's economy is undergoing a structural shift. We do not know what will come out but we can see some of the outlines to come. The developed countries will have slower growth for quite some time. The financial sector is likely to have much more stringent regulations, as

governments would be much more intrusive, cautious, risk averse. Businesses will have industries which have excess capacity which will now be consolidating. Their customers will have access to less credit, which means there will be less demand, less need for new capacity, less new investments. Governments all over the world will play a larger role in their economies. The visible hand will be more visible and more reluctant to leave it to the invisible hand. The governments would be more interventionist, more redistributive. I think the result will be less vibrancy, less dynamism, slower growth, but hopefully less likelihood of a repeat disaster.

In Asia, we expect the Asian economies to develop faster than the OECD. China is shifting to boost its domestic demand to drive growth. India just had a general election, a decisive victory by the Congress Party and its coalition partners. We hope this will help it to push faster towards further economic reforms, but we shall see. With rising affluence and rapid urbanisation, Asia will offer new opportunities for growth. But taken as a whole, Asia does not have the weight, the heft, the size to make up for the slowdown in the OECD countries and so overall I think we are headed for a slower period.

It is not just faster or slower growth. I think there is also a change in attitudes worldwide. People have seen this major crisis and the subsequent economic troubles and in the West, many voters have turned against globalisation and become negative on international trade and investments. In America, for example, which is one of the most open of the developed economies, the mood has become nationalist. In fact, it is nationalistic and anti-trade. When the American government had a stimulus package, they put in "Buy American" rules into the package. When the American government helped their banks

with funds and capital, they put in a rule "No foreign hires". It was not helpful because then the banks are deprived of the talent they need to solve their problems and they got around it by having their foreign subsidiaries hire their foreigners. But, politically, it was necessary. And recently, the American government has announced a proposal to make American MNCs pay tax on their offshore income. When the President announced it, President Obama vowed to make the US tax code 'more fair'. He said, "We will be finally ending tax breaks for corporations to ship our jobs overseas". So it is emotional, rousing political language, completely understandable in this situation but the effect will be less support for trade, less support for globalisation, less opportunities to grow and prosper together. It is happening in Europe too, where we have seen angry agitation against immigration and foreign workers. On May Day, we had a rally and we celebrated at NTUC Downtown East. I went back and watched TV, and saw that everybody else had demonstrations and riots, in Asia as well as in Europe. These are real sentiments which will have real implications. The protectionist moves will affect us because our economy depends so much on free flow of goods and services, on capital and talent.

There will be political impact from the economic crisis too. There is deep anger against those who are perceived to have caused this problem, to have led the countries into this mess, to have fed at the trough, to use the vivid language which is being used now against bankers, against those who prospered and got rich during the good times. AIG, the biggest triple-A insurance company in the world had gone bankrupt. It received government assistance by the billions and paid bonuses to some of its people, causing an overwhelming public reaction, even though the people who received the bonuses were not the ones who caused the company to go bust, but the ones

who are helping to sort out the company and get it back on its feet. But the mood was such the anger was palpable.

So governments are under pressure. In France, you have seen strikes and demonstrations. In Iceland, the government has fallen, replaced by a new government. In Hungary, the government has also fallen. It is now a caretaker government, waiting for elections. As countries come under political pressure, relations between countries are also likely to be affected. Trade disputes can widen into broader frictions in their relationships. The Chinese are very worried about this. Their leaders are writing Op-Eds (Opinion Editorials) in Western newspapers – you see them in the Herald Tribune, the Washington Post and the Wall Street Journal. Senior Chinese leaders, like the Deputy Prime Minister, sometimes the Premier himself, writing Op-Eds extolling the virtues of free trade, encouraging countries to work together and to cooperate to keep their doors open. It is unimaginable a decade ago or even five years ago, but now they are deeply worried that their relations with America will turn sour and that will sour up not just the trade relationship but the whole global strategic situation. So far, the major economies are emphasising their need for cooperation. They are saying the right things. But what they are being forced to do is another matter. So we will have to watch what they do and not just listen to what they say.

In Southeast Asia, relations between the ASEAN countries are still good. We know that many of the members have domestic preoccupations. We were supposed to have a meeting in Pattaya a month ago. It had to be called off and dispersed because there were demonstrations and we could not hold our meeting. So understandably with these preoccupations, ASEAN cooperation has slowed down. And it will become more challenging to implement the ASEAN

Charter and the ASEAN Economic Community by 2015, which is our objective. But, nevertheless, we will have to try because we have to work together with our neighbours to make the best of a difficult situation.

In this more difficult and uncertain outlook, there are opportunities for Singapore. The Asian growth story is intact and the main plot for us going forward. We are small which makes us vulnerable to external changes, but at the same time it enables us to focus on doing well in niche areas. We do not have to be good across-the-board. We can do well in specific areas where we can excel and take advantage of the bright spots to build new businesses for ourselves. And even in this downturn, we are not doing badly in some of these areas. I will give Members a few examples. One is in the manufacture of oil rigs. We do not have oil, we do not have major oil companies, but we manufacture oil rigs and we are the world leaders with 70% market share, thanks to Keppel and SembCorp. We drink Milo, it contains malt extract. One third of Nestle's malt extract for the whole world is made in Singapore, somewhere in Tuas. Foreign law firms servicing Southeast Asia, nine out of 10 situated themselves in Singapore. So if you go for targeted niche areas, we can really excel and we can make a living for ourselves by accumulating many such niche areas.

At the broadest level, our approach to economic development and growth remains valid. We have to stay open to trade and global competition. We have to be present all over Asia, and linked up with the world. We have to upgrade our skills, build new capabilities and keep our lead. And we have to encourage our people to be self-reliant and enterprising, rather than dependent on state support and welfare.

But while the broad strategy is valid, which MPs have acknowledged (even Mr Low Thia Khiang when he spoke on Monday, which I thank him for) we need to review our specific strategies to develop the different sectors of our economy. Relook at the potential. Find new ways to attract investments. Implement policies to keep growing faster than other developed countries can and to give Singaporeans good jobs. And as the President said in his Address, come out with "fresh thinking and creative answers".

I think we should study five specific strategies. Let me just run through them and give Members an idea of what are the issues which we are thinking about

First, how can we seize growth opportunities? Because without growth, there is nothing to distribute and no prosperity to share. But if we are creative and spry, there are still ways to prosper. I mentioned some of the niche opportunities just now, and we should pursue more of them. For example, manufacturing aerospace components, which is very high technology, needs precision, absolute reliability and quality assurance, and cost is less of a consideration. If we can do that, then aerospace companies looking for a place to establish themselves in Asia, will find Singapore is a good place to do that. We can develop new markets in emerging economies. The developed countries may be down, but emerging economies are still expanding and growing new business. For example, we have many projects in the Gulf, which is still investing in infrastructure, and, I think, we can look for more projects and win more projects there with the capabilities, the reach and the track record which we are progressively building up.

We can make the most of Singapore's unique strengths and experience. For example, using our urban planning and development capabilities to help fast-

growing cities in Asia. You have seen Suzhou Industrial Park celebrating its 15th anniversary this year. The Minister Mentor is there and is coming back this evening, which is why he is not here; Mr Wong Kan Seng came back early. They signed two additional agreements for the Suzhou Industrial Park to develop new projects in Jiangsu. Nantong is one, and another is a new town to be developed in Nanjing city, on an island. It is our reputation, our ability to deliver, our reliability which are creating these new opportunities overseas. At the same time, we look closer home and we maximise our win-win cooperation with our neighbours. Closest, of course, is just across the Causeway, the Iskandar Malaysia project. I had a good discussion with Prime Minister Najib Razak last week and he is keen to develop our relationship and take it forward, and have a forward-looking, constructive relationship between Malaysia and Singapore. I told him I fully agree with this approach and we must try to work together in these difficult times.

So the first key question is, how can we find new opportunities to grow? The second question is, how do we strengthen our corporate capabilities, make our companies stronger, able to do more things? We need not just MNCs, but also local companies, not just big companies, but also small ones, start-ups as well as mid-sized companies and established global names, so that we will have a diversified and resilient corporate landscape. We have got many of the big global companies in Singapore – Exxon, Shell, Motorola, Hewlett Packard, Sumitomo, and Thomson. We need to attract the next tier of global companies after the Fortune 500 – slightly smaller, but by Singapore standards still large. They are not quite so familiar with Asia, so they can invest here because they are comfortable with our business environment and they see this as a good base to expand in Asia. The Germans have a very powerful small and medium enterprise

sector. They call it the Mittelstand – actually not so small by our standards, and very capable. We have been courting them for many years and some of them are here. We have a German centre where they can start up, begin to get their feet on the ground, before they have their own premises.

We have other European companies which are in this class and are setting up here, like Berg Propulsion, which is a Swedish manufacturer of marine propellers and thrusters. So we should look for not quite so large, but still valuable global companies. We should look for Asian companies. Asian multinationals are internationalising. Chinese multinationals are going worldwide. The Indian multinationals are also going worldwide. Can we be the global HQ for such companies which are going overseas and want to have a place to set up overseas?

There is one example which is Focus Media, China's leading provider of advertising platforms. They are here and more can come because many of them are going out into the world. Singapore is at once familiar with them and, at the same time, operates by western and international business norms, so they can learn how to work in an international environment.

Of course, we also want to nurture our own companies and make them globally competitive in time. So how do we grow our local companies and make them internationalised? Many MPs have spoken about this and, in fact, the Government wants to help these companies grow. We are trying many ways to do this, we are willing to do more, and we will study this further. But I would like to say that there is no simple answer to this question, and I do not believe this can be done simply by the Government pouring money in or – one of the favourite quick proposals – setting up "Temasek II".

The critical factor is not the availability of money or capital. The critical thing is that we need to build an entire enterprise ecosystem. A whole environment where we can attract talent and develop entrepreneurship so that people with bright ideas, passion and drive, and the organisational abilities to take a spark; to a brainwave; to a startup; to a company; to an Initial Public Offer (IPO) and then to – we hope – a fortune and roaring success. They need entrepreneurship, they need professional management, they need to invest in technology and they need to develop distinctive brands. It is not an easy thing to do. I thought I should explain this because otherwise we may go back thinking that the new slogan is a new policy. But it is something which we will study and work at.

Thirdly, besides growing our companies and their capabilities, we have to develop the capabilities of our people; grow our human and knowledge capital. Our future lies in being a leading global city for talent – our own talent as well as top talent from around the world. How do we make Singapore an exceptional place in Asia? It is a chicken-and-egg problem. If we can get talent, we can shine, but we must be a first-class place for talent to want to come. And we have to encourage talent to come here, to work here and to take root here. We have to encourage Singaporeans to welcome them and help them integrate into our society. I think it will happen. If you walk around our shopping centres, take a ride on the MRT or go downtown in the evenings, you will hear not just Singapore voices and Singlish, but many accents and many voices. And I think that is good because that is the way we will become cosmopolitan, vibrant, and prosperous.

I was in VivoCity last weekend to have lunch. I met somebody with two kids, and he said, "Hello" to me. I said,

"Where are you from?" He is an American and his kids are in two Singapore schools. Good schools, but Singapore schools and not the American schools. One of them is a Special Assistance Plan (SAP) school, so I asked the daughter, "Ni hui jiang hua yu ma?" She looked doubtfully at me, but she can speak Mandarin. One child was born in Australia and the other child was born in Singapore, and he is working in Singapore and mixing with the Singapore crowd.

That is just one – there are many more and I think that is the future for us if we want to become a global city. If we say, "Foreigners out, Singaporeans first and only", we have a problem. We have to say, "Foreigners come; Singaporeans first; but we are going to make this place prosper with all the help we can get", then we will have a bright future. Of course, when we talk about knowledge and talent, we are also making a big investment in our research and development (R&D) programme. It has been five years since we started the programme, I think it is time for a review. It is starting to yield results and we have made good progress. The question now is: how can we take it to the next level, and expand the economic pay-off from R & D?

The fourth question we should consider is: how to create good and high-value jobs for Singaporeans? Growth is important but growth is for the purpose of improving the lives of Singaporeans – not just a few at the top, but many across the board. Improving their lives through good jobs and rising incomes. How do we achieve this? We have to attract industries that will require skilled workers and technicians as well as professionals and managers so that our polytechnic graduates, ITE graduates, skilled workers, technicians and diploma holders will have their skills in demand and can find jobs which will pay them well and have their lives improved. We must have companies

upgrading their workforce, raising productivity and creating high value jobs. We must have Singaporeans acquiring skills that are in demand through good education and upgrading opportunities like the new university and the new Singapore Institute of Applied Technology. And, of course, we need continuing education and training. All the good work which Employment and Employability Institute (e2i), National Trades Union Congress (NTUC) and the Workforce Development Agency (WDA) are doing.

Finally, we have to ask ourselves how can we deploy our resources to maximum effect. Singapore is a small population, land is finite, and our resources are finite. How do we get the maximum value and bang for the buck? Land, for example, is 700 square kilometres and every plot planned and "choped" for something significant in our Masterplan. If you fly over Singapore on a sunny day, without clouds, it looks like a beautiful tapestry. If you have not got the chance, go to Google Earth, zoom in and you can see every building, every road and almost every ERP gantry, but nothing is left to chance and nothing is left over. Now, in that situation, what do we do? We need to expand. We can reclaim land. Yes, we are reclaiming land but reclaiming land does not stretch our international boundaries. And the more land we reclaim, the less ocean space we will have. And PSA reminds us that we need sea space for the port, anchorages and navigation lanes, so there is a limit to how far we can reclaim. So what can we do?

We have to make judicious trade-offs – recover land from less productive and declining industries, make space for new industries which are bringing in better jobs. We have to make difficult decisions – the port is 30 plus million TEUs (Twenty-Foot Equivalent Unit) per year. If we are going to make a 60 million TEU port, we need twice as much land. Can

we afford that? What do we have to give up to do that? It may mean fewer factories, less housing and less training areas for the SAF. Nothing is for free, there is always a trade-off. But I think we should try to relax this trade-off as much as possible. Think of creative ways to expand supply of space, if not of land. Can we go down and use underground space? We are digging. We have underground storage. We are thinking about underground malls. We have talked about ideas to have a whole underground space under the Padang. It is expensive, but some of it can make economic sense. Can we go upwards? There are limits, partly because of air traffic constraints, because we have airports and air bases and we have to leave enough space. We cannot become like Kowloon in the old days, with aeroplanes making sharp turns to land, because I think it will be too exciting for all our visitors coming to the IRs. But with better air navigation and air traffic control, I think that the limits can be tightened. The limits for the aeroplanes can be tightened. Where the height constraints are because of this reason, they can be relaxed and we can build higher with high-rise development in such areas. These are real issues which we are studying. I think that there is potential. We have not reached the absolute limits yet.

Another area where we have to consider limits is foreign workers. Many MPs have spoken about foreign workers. As Mr Heng Chee How pointed out just now, one-third (about one million) of our workforce are foreign workers. The majority are lower skilled work pass holders. They helped us to grow our economy – building our infrastructure, bolstering our workforce and filling critical gaps. I think in this downturn the number of foreign workers will fall, particularly in manufacturing and services. Maybe not in construction because that is chugging along. But when the economy recovers, demand for foreign workers will grow

again. We cannot do without them, but I think we should find ways to reduce our dependence on them because while we can have one million foreign workers in Singapore, I find it hard to imagine that we can have two million foreign workers in Singapore. And, try as we may, we run out of housing units. Therefore, we have to study how we can grow our economy without indefinitely growing our foreign worker numbers and making the best use of the foreign workers who are here to complement our workers so that we get productivity, growth and results.

There is a third area of limits which we now have to think about which did not used to be so critical before, and that is energy. It is an important utility, like water. We take it for granted, we turn on the switch and it is there. Not so in many parts of the world, especially in Asia. Now the price is not so high but last year, there was a spike because oil prices went up. I expect in the long term, the trend for energy prices will be up because as China and India grow, their demand will grow and that will put pressure on the energy markets worldwide. So the question is: how do we encourage energy conservation to grow more sustainably and to be less affected when energy prices go up from time to time or in the long term?

The Japanese did this well. After the first oil shock in the early 1970s, they were very severely affected. They put their minds to it. They restructured the economy and they kept energy prices quite high for a long time after that. So, by the time there was a second oil shock in the late 1970s, they were less affected. By the 1980s and 1990s, they were one of the most energy-efficient developed countries in the world. We have to learn how to do that. At the same time, we have to diversify our sources of energy for security. We need

to become less dependent on piped natural gas, which is from nearby sources, and look for alternatives to piped natural gas, eg, LNG. We are building an LNG terminal. That is an alternative because once it is LNG, you can buy from around the world – Australia, the Middle East, Trinidad and Tobago, Russia – many possibilities. That is a major step we are taking. What do we need to do beyond that? Do we need to develop other sources of energy?

We also have to consider climate change. This, I think for many Members, is a new subject. The younger Members have focused on it. They have green issues on their minds, which is right. There is a global deal currently being negotiated under the UN Framework Convention for Climate Change. Singapore must do our part in any global deal because it will be expected of us and we have to do this. That means that there will have to be adjustments and improvements in our energy efficiency. It will mean costs for our economy and we have to prepare for a carbon-constrained world. So these are finite limits which we have to study – how can we push the limits and do our best within them.

I think that these are important enough issues for us to have a major strategic review. We will form an Economic Strategies Committee (ESC) to look into these issues, and Minister Tharman Shanmugaratnam will chair the Committee. We will involve both the public sector as well as the private sector so as to tap the strengths of both, as Mr Inderjit Singh and several of the other MPs have suggested. We want a broad representation to canvass a spectrum of views. We have found such exercises very useful. I have personally been involved in several of them over the years, including the ERC most recently. We hope that the Committee will be able to develop its main recommendations in time for next year's Budget.

So I am confident that we can develop strategies to pursue global opportunities by enhancing our capabilities and growing our economy, that we can pursue inclusive growth and make the best use of our resources. And that is the way to transform our economy to continue to prosper and to build a first-class home.

Now let me turn to politics. Maintaining growth depends on getting our politics right. We do not possess in Singapore some secret or magic recipe for growth. As Assoc. Prof. Koo Tsai Kee noted just now, individually, we are not necessarily smarter or more hardworking than people in other countries. But as a Singapore team, we outperform many other countries. Why is that? It is because of the trust between the Government and the people. It is because of the close relationship between the tripartite partners. It is because of the strong social cohesion we have forged, all of us working together for a better future for all sectors of our society. And the key underlying factor which makes sure that we can have this trust and we can have the right policies in education, social policies, foreign policies, security and politics is, in fact, a good political system – a system which ensures continuity, so that you have consistency from year to year in the direction the country is going; which ensures renewal, so that there is systematic political succession every four or five years, with a new batch of MPs and Ministers entering Parliament and taking over the baton progressively. And we also have renewal in terms of the way the system works so that it stays abreast of events, is not overwhelmed by a tsunami unexpectedly, and it can produce a long period of stable, competent government, which will develop and implement policies which will work for the country.

Our political system follows the British model of Parliamentary democracy but we have evolved it over time, in response to

changing needs and to our own circumstances. I will just cite some of the major changes we have made to our system to show you how far we have come and how different we now are.

In 1963, 40-something years ago, when we joined Malaysia, we amended the Constitution so that when an MP resigns or is expelled from his party, he loses his seat. It has prevented MPs from switching sides in Parliament and it has shielded us from the unstable politics which are so common in other legislatures.

In 1984, we introduced the Non-Constituency MP (NCMP) scheme to ensure a minimum representation of Opposition Members in Parliament.

Then, in 1988, we introduced the Group Representation Constituencies (GRCs) scheme to guarantee a minimum representation of minorities in Parliament and ensure that we always have a multi-racial Parliament and never have a freak result when suddenly you have Parliament all of one colour or of one faith, and we have a crisis.

Then in 1990, we provided for Nominated MPs (NMPs) to bring more alternative views and constructive dissent into the House.

In 1991, we created the elected President. It does not affect the House but it is a major component of our political system. The President with his second key custodial powers over reserves and key appointments has become crucial to the whole structure.

In 2001, we provided for overseas voting because more and more Singaporeans are now scattered on all the continents of the world. All these changes have kept our system well adapted to our needs and have given our people easy

access to the Ministers and senior officials in Government through their MPs.

But this is always work-in-progress like Singapore. So as the world changes, and as Singapore society continues to evolve, so too must our democratic institutions. We are moving beyond providing for the basic survival needs of citizens. We face more complex policy choices, and we need more creative ideas for social and economic development.

And Singaporeans want national issues to be more fully debated, and they increasingly want to participate in this discussion, which is all to be encouraged. Therefore, we should improve our political system to encourage a wider range of views in Parliament, including opposition and non-government views. Some of the changes we have made to our system over the years have been, in fact, for this purpose, like the NCMP scheme or the NMP scheme. But we should do more. I think there are many benefits to doing this. It will generate more robust debate and improve policy formulation. It will expose PAP MPs to the cut and thrust of the debate, and demonstrate what the Opposition can and cannot do. Most importantly, changes like these will keep Parliament in sync with the concerns and aspirations of Singaporeans, and strengthen the role of Parliament as the key democratic institution where important national issues are deliberated and decided.

But we have to make the changes carefully. Our goal is to improve on a system which is already working but can still be improved. We must not jettison the lessons that we have learnt at great cost through our political history and experience over the last half century as to what really works for Singapore. Nor should we create a system which inadvertently produces weak governments

just to placate those who desire a stronger opposition in Parliament. Singapore has to have a strong and capable government, with a clear mandate from the people and the ability to act decisively to protect and advance our interests. We cannot afford a government that is ineffective, indecisive or paralysed by internal divisions. We are seeking a system that works well for Singaporeans, and that will deliver good governance, and strong and competent leadership. We are not looking for a system which sounds good in theory, but is unsuited to our conditions and unworkable in practice. This approach, this sort of system, is what marks us as different from many other countries.

Our political system is based on the "first past the post" principle. Westminster is like that. We have kept our system "first past the post" despite making modifications and refinements to it because it tends to produce decisive majorities and enables the winning party to govern effectively. The alternative to the "first past the post" is a proportional representation (PR) system. This would certainly increase representation of alternate views and opposition parties in Parliament. But PR systems tend to produce weak governments, based on shifting coalitions of different parties. In some countries, this is fine. It has worked for the Scandinavians, the Germans and the Swiss. These are homogeneous societies. The political views are along a spectrum, primarily from centre left to centre right. Different parties are arranged along that spectrum. And depending on the mood in the country, you form a more left coalition or a more right coalition, and then you govern for the next few years. But it does not always work like that. The most extreme example of proportional representation in the world is Israel where any party can get a seat in Parliament provided it collects just 1% of the total vote of the whole electorate. And Israeli politics is much more exciting than

Singapore politics. It is characterised by weak coalition governments, with small extremist parties wielding a disproportionate influence on the policy of the government because the government needs the minority partner. The minority partner only cares about one thing, and you either give me one thing or I force a vote of confidence, and you are out. It happens all the time. In Israel, the negotiations begin after the elections end, because then you decide, argy-bargy, who to form the next coalition; then you test the coalition with a vote of confidence; then you really know you have a Prime Minister and a government.

In Singapore’s specific context of a multi-racial and multi-religious society, situated in a dynamic and unpredictable environment that Southeast Asia is, proportional representation would ruin us. We need strong national leadership and cannot afford a system which is going to produce weak coalition governments. That is the first reason PR does not work for us. But I think the most important reason PR does not work for us is this second one, that because we are a multi-racial and multi-religious society, PR will encourage parties to form based on race and religion or, for that matter, based on cause-related issues, to push stridently for the narrow interests of their group, at the expense of other groups, and this would polarise and divide our society. Instead of politics bringing people together, politics will pull people apart and make them clash, and Singapore will fail.

You can have a hybrid system. Mr Siew Kum Hong suggested a hybrid system – a mix of "first past the post" voting, and then you have some proportional representation seats. There are such systems. If you go to Wikipedia and look for "proportional representation", you can see a list of about 30 countries and what sort of PRs they operate. But even hybrid systems have the same tendency as pure PR systems. New

Zealand, for example, has a hybrid system. They used to have a "first past the post", but changed to a hybrid system, and now New Zealand regularly has coalition governments. There are two big parties but neither can form a government on its own. They always have to negotiate with the small parties to form a coalition. It is a very interesting business. In the previous coalition government, Labour, led by Ms Helen Clark, the coalition was so diverse that they had to have parties in the coalition who really did not support the policies of the government. And Helen Clark had to appoint two Ministers from her coalition partners who were Ministers outside Cabinet. I looked up what "Ministers outside Cabinet" means. It means they are bound by collective responsibility only on the matters in their portfolios. In other words, if I am the Foreign Minister – their Foreign Minister was Mr Winston Peters from the New Zealand First Party, a Maori party – on foreign policy issues, I have to abide by Cabinet decisions and support whatever Cabinet decides. On education, defence, trade, or anything else, I am not bound by what Cabinet decides; I can have my own policy. And he does not sit with the Cabinet on the frontbench, he sits near the Cabinet on the cross benches. I think I do not have to elaborate a lot more to explain why we have always rejected proportional representation as being unsuitable for Singapore.

Therefore, it is best for us to refine our present "first-past-the-post" system further to fit the changing needs of our society. I propose three changes to the system – NCMPs, NMPs, GRCs and SMCs.

The NCMP scheme was introduced in 1984. Currently, the Constitution provides for up to six NCMPs. Under the Parliamentary Elections Act, the Act prescribes a minimum of three Opposition members in Parliament, although the President can specify a higher number, up

to six, before Nomination Day. So if fewer than three Opposition candidates are returned as elected MPs, then you top up to three from the best losers to make with an additional one, two or three NCMPs so that there will be three Opposition members in the House. The Constitution says there can be up to six NCMPs. The law says there will be at least three Opposition members in Parliament. The President can gazette that it can be six before Nomination Day but, so far, that has not been the practice, we have not done it. So, we have at least three Opposition MPs in Parliament. In the last election, Mr Low Thia Khiang was an Opposition MP, Mr Chiam See Tong was an Opposition MP, so there was one additional possibility for NCMP offered to the best loser which was from Aljunied GRC, and it was Ms Sylvia Lim.

The history of the NCMP scheme is quite an interesting one. When it was first introduced in 1984, in that election there were two Opposition MPs elected – Mr J B Jeyaretnam and Mr Chiam See Tong. There was one NCMP who was eligible, Mr M P D Nair of the Workers' Party in Jalan Kayu Constituency. The seat was offered to him but the Workers' Party – Mr J B Jeyaretnam as the Secretary-General – rejected the seat on his behalf. He had to agree because under our laws, if he did not agree and he accepted the seat, the Workers' Party would have expelled him from the party, he would have been disqualified. The following election, 1988, the best loser was again the Workers' Party, and this time Dr Lee Siew-Choh took the seat and occupied it. In 1991, the best loser was again the Workers' Party, and this time Mr J B Jeyaretnam took the seat, despite having been the person who in 1984 was leader of the party and having insisted in 1984 that he would never accept a non-constituency seat. Then in 2001, we had Mr Steve Chia of Singapore Democratic

Alliance and most recently in 2006, we had Ms Sylvia Lim of the Workers' Party.

The NCMPs – I think we can say fairly - have made their contribution to the national debate. They have expressed Opposition views in Parliament, they have let Singaporeans compare the policies and programmes of the Government and the Opposition and they have enabled Singaporeans to evaluate the performance of parties and MPs through the continuing debates in Parliament day in, day out, during the whole term of the Government, and not just during the short period of the campaign during the General Election. So this NCMP scheme has achieved its purpose and has been accepted by the public. However, given that there are 84 elected MPs in the House, instead of a minimum of just three Opposition MPs, we should increase this to a minimum of nine opposition MPs, including NCMPs, which would make the minimum number of Opposition MPs equal to the number of NMPs in the House, which is also nine.

We will amend the Constitution to change the current maximum number of NCMPs that Parliament can legislate from six to nine. We will also amend the Parliamentary Elections Act to increase the minimum number of Opposition MPs plus NCMPs in Parliament to nine. So the actual number of NCMPs will then be nine minus the number of Opposition MPs who are elected directly to Parliament. Since the number is nine, there will be no need for President to specify any number before Nomination Day. Therefore, whatever the election outcome, Opposition Members directly elected, or Non-Constituency Members, will form at least one-tenth of the directly elected Members of Parliament who have constituencies, right now 84 of them.

We also propose one more change to the NCMP scheme, and that is to amend the Parliamentary Elections Act to set a cap of two NCMPs to come from any one

GRC. This will spread out the NCMPs more evenly and make them more representative of those voters who have voted for the Opposition nation-wide in a General Election. It will also clearly distinguish between the winning and the losing teams in a GRC because we should not have an outcome where the entire losing team enters Parliament as NCMPs and enjoys almost equal status with the winning team. For example, if we had done this before the last General Election, the outcome would have been like this: There were two Opposition MPs elected – Mr Chiam See Tong and Mr Low Thia Khiang. Then we would go down in order of decreasing percentage of votes – Aljunied GRC, Workers' Party, we would have had two NCMPs, Ms Sylvia Lim presumably, plus one; Chua Chu Kang, a "single" (SMC), Mr Steve Chia; then East Coast GRC, Workers' Party with two NCMPs, up to the party to decide who; Joo Chiat, SMC, Workers' Party candidate Dr Tan Bin Seng; and Nee Soon Central, SMC, Workers' Party candidate Mr Lian Chin Way. So two Opposition MPs and seven NCMPs.

Next, we will improve the Nominated Member scheme. The scheme started in 1990. Initially, the Constitution provided for up to six NMPs and we, in fact, appointed two in the first batch. In 1997, we amended the Constitution to provide for up to nine NMPs, which is where it is today. The scheme has worked well. The NMPs represent non-partisan alternative views in Parliament, and the NMPs have made effective contributions and raised the quality of debate in Parliament. Sometimes, if I may say so, they may have outshone even the Opposition MPs. This NMP scheme should be a permanent part of our political system. Presently, each time Parliament meets after an election, Parliament is required to pass a motion resolving that there shall be NMPs for that term of Parliament. This was a safeguard which was introduced when the scheme was new because we could not

be certain how the scheme would work. But after 20 years, this is no longer an issue, as Dr Loo Choon Yong pointed out yesterday. Therefore, as he suggested, we will do away with the motion on the NMP scheme in each Parliament so that we will always automatically have NMPs in Parliament. This will also require an amendment to the Constitution.

We also propose to fine-tune the scheme to broaden the representation of various interest groups. NMPs are chosen by a Special Select Committee of Parliament. The Committee invites nominations from the public in general but also formally invites nominations from six groups – business and industry, the professions, the labour movement, social and community organisations, media, arts and sports and tertiary education institutions. I think that the Committee should broaden its reach to invite nominations from one additional group which we have paid a lot of attention to and would like to cultivate, and that is the people sector. It could be those in the environmental movement, it could be young activists, it could be new citizens, it could be the community and grassroots leaders. This will give civil society a voice in Parliament and encourage civil society to grow and to mature further.

Thirdly, GRCs and SMCs. Our present electoral system is to have most MPs elected in GRCs with a limited number of SMCs. This is a sound system. The GRCs ensure multiracial representation in Parliament. They encourage political parties to appeal to all races with moderate policies and not to one race or another with chauvinist or extremist policies. And they also put a premium on parties which can field credible teams and therefore demonstrate that they are fit not just to become MPs but to form the Government. In this GRC system, we always have some number of Single Member Constituencies to keep the entry barriers low, which means small parties

can still participate in the elections and it will give adequate opportunities to the small parties and to the independent candidates to contest in a general election.

GRCs should continue to be the same basis of our electoral system but we should refine the size and the number of GRCs and SMCs. The rules are specified under the Constitution and in the Presidential Elections Act. GRCs can have three to six MPs each and there must be a minimum of eight Single Member Constituencies. In practice, currently there are nine GRCs with five members and five GRCs with six members, making a total of 14 GRCs, and there are nine Single Member Constituencies. We should fine-tune the implementation of the GRC and SMC scheme in the light of our experience. There is no need to amend the Constitution or the Act. These specify the basic framework for the scheme. Within these limits, the Electoral Boundaries Review Committee (EBRC) has the flexibility to work out specific sizes and configurations of constituencies to match the population distribution. So we can effect the refinements by making them explicit in the terms of reference to the EBRC when I appoint the EBRC.

There are advantages to having bigger rather than smaller GRCs. They enable stronger multiracial teams to be formed, which include MPs who have different backgrounds and skills, who can serve voters more comprehensively and effectively. For example, they can pool resources and provide economies of scale to run Town Councils more effectively. Bigger GRCs also require any challenger to field a strong team and offer a serious alternative to have a chance to win. Therefore, bigger GRCs encourage responsible and credible Opposition parties to emerge.

But, at the same time, there are some downsides to having too big a GRC because it becomes harder for voters to identify with the whole GRC or with the whole GRC team. The Members split up, so the voter knows who is looking after his area but for the other MPs, he may not have quite as close a relationship. Each MP has to look after his own ward in the GRC and, therefore, it is not easy for him or her to get to know the voters in all of the other wards.

In the light of our experience, we have concluded that, on balance, smaller GRCs (less than six members) have the edge over larger GRCs (six-member GRCs). Therefore, we should have more smaller GRCs and fewer six-member ones. I do not think we should rule out the six-member GRCs entirely because sometimes the configuration of constituencies on the ground makes this the most practical option, but we should have fewer six-member GRCs. On average, the GRC size should be smaller. Therefore, when the EBRC is next appointed, its terms of reference will state that it should create GRCs such that, firstly, there will be fewer six-member GRCs than now, and secondly, the average size of the GRC will be smaller. The present average size of GRCs is 5.4 because there are five and six-member ones. The new average, which will be stated in their terms of reference, should not exceed five. This guidance to the Committee will achieve our objective of having smaller GRCs while giving the Committee enough flexibility to do its work properly.

Within this GRC system, it is useful to have a limited number of SMCs. But over the years, the number of voters has increased. The number of elected MPs has also gradually increased. And it may rise further as voter numbers increase further. Therefore, we should increase the number of SMCs to keep pace with the increase in the number of elected MPs. At present, there are nine SMCs. The terms of

reference of the EBRC will state that they should create at least 12 SMCs.

The changes to smaller GRCs and more SMCs may or may not result in more seats being contested or more Opposition MPs being elected. That is not their purpose. Ultimately, it is up to the Opposition MPs to field candidates to contest elections and up to the voters to decide who they want to represent them in Parliament. The purpose of these changes is to make the GRCs scheme work better and to strengthen the link between voters and their MPs. We want voters to have a strong incentive to vote for candidates who will do the best job of looking after their interests, representing them in Parliament and forming a government to run the country. So it is really three duties – looking after their interests, representing them in Parliament and forming a government. And we want the voters to think carefully and decide and vote for the group and the party which will do the best of these three jobs. At the same time, we want MPs to have a strong incentive to do their best in these three responsibilities and to work hard to serve their voters well, both as individual MPs and as a GRC team and, therefore, win the support of voters.

Overall, the changes to the NCMP, the NMP scheme, the GRC and SMC scheme will result in a more balanced electoral system. There will be at least 12 SMCs, fewer six-member GRCs and a range of smaller GRCs. Each Parliament will have at least nine Opposition members and nine Nominated MPs, so that there will be at least 18 members who are not from the ruling party, which is about one-fifth of the House. This change in the composition of Parliament will affect the dynamics of the House, between the Government and the Opposition parties. MPs on both sides will have to learn how to operate in this new environment. Government MPs will have to become sharper at defending their positions,

accepting constructive criticisms and scoring points off the Opposition once in a while. And I am sure Opposition MPs and NCMPs will want to score points too, which they are entitled to, but they must also understand that while they may be in the Opposition, they must uphold the political system and the institutions of our democracy and their loyalty must be to Singapore.

These changes are not to entrench any one party, nor to deliberately result in weakened governments. They update our political system so that it reflects better the aspirations of Singaporeans. They provide adequate voice for diverse views in Parliament, including non-partisan views and those who have voted for the Opposition. They also ensure that the Government, which is elected, has a clear mandate to govern in the interests of Singapore, so that our political system will continue to serve Singapore well, now and into the future.

I am making these changes now, mid-term, not because I am about to call elections. I have not yet appointed the EBRC, but I want to initiate these changes now so that we can discuss and settle this in a calm atmosphere and make the amendments in ample time before the next election. These changes are not just for the 2011 General Election but also for the long-term strength and stability of the system.

Finally, please remember whatever political system we may have, it will only work well if the electorate votes wisely, in the full knowledge that if they vote for frivolous or fickle reasons, it will mean a setback to our economy and our future. Otherwise, we will not have honest leaders to run the system and govern the country. Voters have to see the parties and candidates for who they are, what they can do and make a decision in line with their true interests. If the PAP is serving them well, then they should vote

for the PAP. If the PAP is letting them down, then they should vote against it. That way, we make sure we always have the best team to serve Singapore well.

To do that, we also need good leaders, because no system works by itself. You can have the most ideal system on paper, but without the right people to operate it, it will malfunction and go awry. So we must always have honest, able and committed men and women to come forward to contest elections to serve Singapore. We will make sure the system works properly, and where it needs improvement, we will make changes to address these problems.

I have a good team in place now. But my most critical job is to find and nurture more such men and women to be the next generation of leaders. Only then can we secure our future and improve our lives and the lives of our children. [Applause.]

Mr Low, only points of clarification, please.

Thank you, Sir. I have three clarifications. The first one: will the Prime Minister, in appointing the EBRC, also add into the terms of reference that in the re-drawing of boundaries, it should keep the existing electorate as far as possible? Because our biggest complaint on the GRC system is that there is a tendency of gerrymandering, like in the Cheng San GRC where you cut up the whole Cheng San GRC to Ang Mo Kio.

Sir, the second clarification: will the Prime Minister consider appointing the EBRC earlier, prior to the election that he intended to call, so that the Opposition will have more time to look at the new changes?

The third clarification: I would like to ask the Prime Minister for his assessment

on how serious is the US going to implement those protectionist policies, such as taxing companies in foreign land and also to "buy American".

Mr Deputy Speaker, Sir, on the third question, the Minister for Trade and Industry is speaking tomorrow, he can deal with that.

On the first question about the EBRC, how they draw the boundaries is up to the Committee. I think it is best to leave them to decide in accordance with the situation on the ground. They do not disturb boundaries unnecessarily but when the population has changed, boundaries have to recognise these electorate changes.

On appointing the EBRC earlier, we will appoint the EBRC in good time. It is not our intention to do it at the last minute and spring surprises on either our own members or Opposition members. We have had short notices before, particularly in 2001, for exceptional circumstances which we have explained. In the last election, before 2006, the EBRC reported in February, and the election was held in May. I will not tell you how many months' notice I will give, otherwise when I appoint the EBRC and its results are published, you will calculate forward and determine the election date.

One clarification, Sir. Thank you for the comprehensive review of our political system. Has the Prime Minister considered or already considered this question of by-election where if a seat falls vacant within a period of six months or one year, by-election will have to be called? I know it is a bit inconvenient but that is to protect the electorate.

Mr Deputy Speaker, Sir, I do not intend to do that. We had debate on this subject last year in

October, and I believe this was fully discussed.

Mr Deputy Speaker, Sir, I am sure that Members would like some time to ponder over what the Prime Minister had said. So, under Standing Order 91(5), may I seek your concurrence to move that the debate be now adjourned?

I give my consent.

Resolved,

That the debate be now adjourned. – [Mr Mah Bow Tan].

Mr Palmer, resumption of debate, what day?

Tomorrow, Sir.

So be it.

Resolved,

That Parliament do now adjourn. – [Mr Mah Bow Tan].

Adjourned accordingly at

One Minute to Six o'clock pm.