Hansard, Monday, 18 February 2019

1 Mr Lim Biow Chuan asked the Minister for Manpower whether the CPF Board will (i) amend its policy to allow automatic withdrawal of the CPF payout when a member reaches 65 years of age and (ii) allow members who wish to withdraw their CPF funds later than age 65 to then indicate their choice in an opt-out form.

2 Mr Patrick Tay Teck Guan asked the Minister for Manpower whether the CPF Board will be reviewing the opt-out scheme for payouts and allow automatic CPF payouts when a member reaches 65 years of age.

3 Ms Jessica Tan Soon Neo asked the Minister for Manpower given the feedback and concerns received regarding the CPF payout under the Retirement Sum Scheme, whether the CPF Board will consider revising the default option for CPF payout age to 65 years instead of the current 70 years.

4 Miss Cheryl Chan Wei Ling asked the Minister for Manpower (a) whether sufficient public communication was done prior to the letters being sent to individuals with regard to the option on the timing of their CPF payout; (b) whether there are other approaches to notify the general public of this option before the official process kicks in; and (c) for those who have earlier failed to notify CPF that they wish to receive their payouts upon age 65, whether they are allowed to do so at any point of time before they turn 70.

5 Ms Foo Mee Har asked the Minister for Manpower (a) what can be done to ensure that the public understands that the CPF payout age remains at 65 years of age; and (b) how can engagement with CPF account holders be improved to facilitate easy access to CPF funds at payout age.

6 Mr Liang Eng Hwa asked the Minister for Manpower (a) whether the CPF payout starting at age 65 can be made as a default option; and (b) whether the CPF payout starting beyond age 65 can be made simpler and more appealing as an option.

7 Mr Chong Kee Hiong asked the Minister for Manpower whether the Ministry will consider making the age of 65 the default option for CPF monthly payouts while providing incentives for CPF members who opt for the payouts to be deferred.

8 Mr Png Eng Huat asked the Minister for Manpower since the start of 2018 (a) what is the number and proportion of members on the Retirement Sum Scheme (RSS) who activated their CPF payouts upon reaching their Payout Eligibility Age (PEA); (b) what is the number of members who, having missed the activation deadline, appealed to start their payouts before age 70; and (c) whether the Ministry will consider setting the default automatic CPF payout age of RSS and CPF Life scheme to the PEA to further simplify the activation process.

9 Assoc Prof Walter Theseira asked the Minister for Manpower (a) for each year of age between 65 and 70 what is the proportion of eligible CPF members who apply to start payouts; (b) for members of the 65 to 70 age group receiving payouts, what is known about their use of payout monies, in particular, the extent to which payouts are retained in low-interest deposit accounts instead of used for expenses; and (c) whether and to what extent there are cases of financial hardship due to eligible members not applying to receive payouts.

Mr Speaker, may I take Question Nos 1 to 9 together, please.

Please do.

I thank the Members who have raised important questions. There are several key questions I hope to address in this reply.

The first question is whether the Central Provident Fund (CPF) Payout Eligibility Age has been shifted from 65 to 70. The answer is no.

As Members are aware, the Payout Eligibility Age (PEA) is the earliest age at which CPF members can start their monthly retirement payouts. From 1 January 2018, the PEA has been 65. It is still 65 today. We have not shifted the PEA from 65 to 70, as was alleged by a spurious online post. Members can start their retirement payouts any time from 65.

The second question is whether the policy has been changed to now require CPF members to come forward to start their retirement payouts. The answer is again no.

This is in fact a long-standing practice and there has been no change. Members can instruct the CPF Board when to start their retirement payouts at any time after they reach their PEA. Members are in the best position to decide based on their individual circumstances. It is also the same approach as in many other countries.

There is no advantage for the CPF Board or the Government to want members to defer their payouts beyond 65. Those who defer their payouts in fact enjoy the higher interest paid on their CPF monies.

Members who have reached their PEA can instruct the CPF Board at any time to start their retirement payouts. Let me explain how the process works for those on the Retirement Sum Scheme (RSS), which is the main retirement payout scheme for members born before 1958. The members are now aged 61 and above.

About six months before their PEA, RSS members will receive a letter from the CPF Board informing them that they can start their payouts any time from PEA. The form to start payouts is attached. Members only need to fill in basic information – their name, NRIC, contact details and bank account details. This gets sent back to the Board. Alternatively, members can apply online through the CPF website or come to a CPF Service Centre. Members who do not instruct CPF Board to start their payouts are reminded through their Yearly Statement of Account.

The third question is why the payouts start automatically at age 70. In the past, some RSS members had their savings intact in their CPF accounts until they passed away. They never touched it at all. This is unsatisfactory. We therefore introduced a Latest Payout Start Age of 70 for members turning 70 from 2018.

Even if such members have not applied to start payouts, CPF Board will start the payouts for them. But I must again emphasise, if a member wants to start his payout before 70, he can do so any time from his PEA; he does not need to wait till 70. In other words, the Latest Payout Start Age is not the same thing as the PEA. It is a way to ensure members get to enjoy the benefit of their CPF savings by 70 at the latest.

Members of the House may therefore recall that in October 2016, Parliament agreed to amend the CPF Act to bring this into effect. Some Members who are still in the House today spoke in support of this amendment, including Mr Chong Kee Hiong, Er Dr Lee Bee Wah, Mr Louis Ng, Mr Png Eng Huat and Mr Saktiandi Supaat.

Several Members have asked if CPF Board should automatically start payouts at age 65. Some are concerned about those experiencing financial hardship. I appreciate the reasons for Members’ questions and also share your concerns.

There are in fact tangible benefits to members when they start their payouts later. Members earn more interest and enjoy enhanced payouts. With every year that they defer their payouts, their CPF savings will earn risk-free interest of up to 6% a year, which is well above the interest rates they would get in the market. This 6% includes the extra interest of 1% for the first $60,000 and additional extra interest of 1% for the first $30,000. For members on CPF LIFE, for every year deferred, the payouts go up by up to 7%. For five years of deferral, that is up to 35% more.

Members may therefore prefer to start their CPF retirement payouts later. This is especially so if they have other savings to draw on that are earning low interest or if they are still working. But if the payouts automatically start at 65, such members will also automatically not get the benefits of deferral.

At the end of 2017, six in 10 members on the RSS who had reached their PEA that year did not start their payouts. Even by the time RSS members reach 70, about half have not come forward to start their retirement payouts.

Some among them may have consciously decided to keep their savings in CPF because they had no need of the payouts and also because they wanted to earn the higher interest. Others may not have known they could have started their payouts earlier and thus did not instruct CPF Board.

The right thing to do, therefore, is to reach out to those members who may not have a good understanding and give them clear and simple information to help them make their decisions. With the benefit of knowledge, those who wish to can still start their payouts any time after 65.

The fifth question, which Ms Foo Mee Har, Miss Cheryl Chan and Mr Liang Eng Hwa have asked, is whether the CPF Board can improve its communications with members. The answer is yes.

While CPF Board has stepped up outreach efforts, there is much room for improvement in the way it communicates key issues such as starting payouts. For example, we will review the letters sent to members who are approaching their PEA, so as to avoid misunderstandings which confuse members unnecessarily.

The Board has also started to invite all members reaching PEA to attend and benefit from a CPF Retirement Planning Service from the start of this year. This is a face-to-face service in which a CPF Board officer provides personalised guidance.

In addition, we will work with other agencies to reach out to CPF members. For example, where appropriate, staff at the Social Service Offices (SSOs) will ask members who approach the SSOs for financial help whether they have activated their CPF payouts and assist them to do so if they wish. We will also collaborate with the Silver Generation Office to communicate this issue to elderly members.

Mr Speaker, I would also like to take this opportunity to clarify the position for CPF LIFE, which is a relatively new scheme.

Members who joined CPF LIFE prior to July 2015 may have been confused whether they too have to come forward to activate their payouts when they reach PEA. Some pointed out that the Latest Payout Start Age of 70 was not mentioned in previous communications with them.

Let me assure these members that nothing has changed for them. They joined CPF LIFE before July 2015. Back then, there was no flexibility to defer CPF LIFE payouts and the policy letter has already stated that the payouts would start from their PEA. For such members, CPF Board will indeed start payouts at PEA, unless otherwise instructed. In fact, by the end of 2018, about 35,000 of such members had already started to receive their payouts upon reaching their PEA, which is what they expected.

Members who joined CPF LIFE after July 2015 will be like members on the RSS. They can start their payouts any time between their PEA and 70, by instructing CPF Board.

Mr Speaker, allow me to conclude. All members can start their payouts any time after PEA by issuing a simple instruction to CPF Board. This has not changed.

However, the exact payout application process and letters sent to members may vary, depending on each member’s particular circumstances, such as whether they are on RSS or when they joined CPF LIFE. Hence, CPF members should not rely on letters sent to others. They should instead contact CPF Board if they are in doubt about any letter sent to them.

With your permission, Mr Speaker, may I ask the Clerk to distribute handouts summarising the key points of my reply?

Yes, please. [A handout was distributed to hon Members.]

Thank you. Mr Speaker, for brevity, I have circulated the English version of this handout. But I want to assure Members that we are producing it in all four official languages, and they will be made available to you to disseminate to your residents, whoever may feel that this is useful. We will also be happy to collaborate with Members to share relevant information with their residents through talks and seminars. This offer will hold at any point in time that Members wish to activate it.

I thank the Minister for clarifying that the Payout Eligibility Age (PEA) has not shifted from age 65 to 70. I think this is very important and very re-assuring for CPF members. But I am concerned that about 60% of CPF members do not come forward to withdraw their CPF when they reach 65 years old. The Minister said that about half of CPF members do not come forward to withdraw their CPF even when they have reached 70 years of age.

This is an area of concern because this is not a small number of people. Could it be that a large number of these CPF members may not do anything about it because they do not know the procedure? Or could it be that they have forgotten about the need to apply to withdraw their CPF savings? It is a big number. If we are saying just a small percentage, then I can understand that, well, perhaps they do not read their mail or that they forgot about it. But it is quite a large number, and I am concerned.

The Minister had said that the CPF Board starts their payout automatically for a member when the member reaches 70 years of age. If CPF Board can do so at age 70, why not make the payout automatic at the age of 65? Just credit to their account automatically, unless the member opts out and chooses to fill in an application to say that they do not want to do so. I think the point is that we need to assure every member that CPF Board will be able to honour any request to withdraw their CPF savings when these are due for payment. And really, this is about preserving the good faith and trust in CPF Board.

So, I urge the Minister to try to dispel any doubts that the CPF Board is deliberately withholding members' CPF monies, even though they have reached the PEA. I just wanted to add that I appreciate the benefit of higher interest rates. In fact, when I reached 55, I made a conscious decision to leave my monies with CPF Board, simply because the interest paid on the CPF savings is much better and as the Government has re-assured us repeatedly, it is risk-free. So, thank you, Minister.

Mr Speaker, the Member Mr Lim has asked a very important question. The points he has raised are not trivial at all. I must share with Members that I gave serious thought to the possibility of shifting the automatic start date to 65. But there are several concerns, and I should share them with you.

There may be a group of members who are aware of the benefits of payout deferral. But they forget to come forward to instruct CPF Board to defer their payouts. There will be such individuals. Mr Lim may become one of them.

Another group may not be aware but actually they do not need the payouts just yet, even after they have reached their PEA. It is entirely possible that this group will grow over time. After all, between the age of 65 and 69 today, our employment rate is about 40%. With good health, we can expect more people to want to work longer. If, indeed, they are still receiving incomes, they may find that the CPF payout is somewhat unnecessary at that point in time.

Both groups may not be so happy that CPF Board made an assumption to start their payouts that deprived them of the benefits, if we were to have such a mechanical approach.

Also, there is another concern that weighs heavily. I am quite wary of making yet another sudden change. We have, for years, told CPF members that their payouts start when they instruct CPF Board – this has been the long-standing instruction. Tomorrow, if we decide otherwise, how can we be sure everyone gets the message? That is the central lesson we have learnt. Every time there is a change, it actually takes a long while for people to get used to it. Each time we make another change – we say that people on the previous system get to keep that previous approach, and from then onwards, this group has a different treatment. Those kinds of changes actually risk confusing people even more.

On balance, I suggest that we focus on improving the communications for the policy as it currently stands. With the benefit of knowledge, CPF members can still start their retirement payouts any time after 65. If we keep to this consistent line, there is less risk of further confusion.

I am glad that the Minister said that the CPF Board will review the letter that is sent to members when the members reach age 65. I hope that the CPF Board can review this particular statement that is made in the letter, "No action is required if you wish to start your payout at age of 70". This line is in bold; it is repeated twice. This is the only line that is in bold. Perhaps that is the reason why people are confused and are thinking if there is a shift in the payout age.

Indeed, like the Minister said, this is a new policy after some changes over the years. Perhaps, more thoughtful communication should be put out, should be considered, so that there are no unnecessary anxieties caused to the members.

Mr Speaker, I wholeheartedly support what Mr Liang has suggested. We definitely can improve the way we communicate with CPF members. Today, CPF Board engages with members through a variety of means. Letters are just one of them. CPF Board administers quite a wide range of Government schemes – MediShield Life, MediSave disbursements, Silver Support, and Workfare Income Supplement. If you put together all the letters that CPF Board sends out, there are about 220 types. Obviously, some of them have the risk of not being entirely clear. We will definitely put effort into improving them.

There is also an avenue which we want to encourage CPF members to use. There are five CPF Service Centres islandwide. Each of these CPF Service Centres is staffed by officers who are conversant in all the major languages, especially, of course, our four official languages. Even if a member was unable to understand the letter that has been sent to them, we hope, by the very fact that they saw the CPF logo, that they will know that they can always approach the Service Centre. The staff will be happy to take them through in a language they are comfortable with. That is something we will make as a commitment.

In fact, CPF Board has already started inviting members to come forward. At the age of 55, the invitation is extended to every member. From this year onwards, once they reach their PEA, which is 65, we will equally invite the member to come again, so that CPF Board can provide personalised guidance, face-to-face. Any question that is not clear, any doubts that members have on the spot, make the explanation available to them and reassure them.

I just have a supplementary question for the Minister. Did MOM reach out to those people who did not activate their payout at PEA, or even beyond 70, to find out why? Perhaps do a survey to this group of people, since we know who they are?

There are two parts to that question. Do we reach out to them? The answer is yes, because everyone gets the Yearly Statement of Account. CPF records will show whether the member has reached the PEA but has not activated payouts, in which case CPF Board will remind the individual that "You have reached the PEA. You are eligible to start your payouts. Here is the form, activate it any time you want".

The second part of it is, do we ask them why they have not started or activated their payouts? Here is where, I think, we have to be a little bit careful. People have a right to their privacy. CPF Board must be quite mindful that not everyone wants to tell the Board the reasons for their actions. Therefore, if we want to establish, amongst those who have not started their payouts, who actually is aware and made a conscious decision not to start it, who is not aware and did not come forward to instruct the Board, this would be quite a major exercise. We think there is some value in doing so but we will have to find a way that the member does not feel very intruded upon.

I thank the Minister for her comprehensive reply. I have three supplementary questions.

First, I think some of the public unhappiness is, perhaps, due to the gap between the retirement age at 62 and the PEA at 65. Some are concerned that they have difficulty making ends meet between retirement and the start of the payouts. Would the Ministry consider aligning the retirement age with the PEA in the future, to allow for a seamless transition between work income and CPF income?

Second, regarding the default "out" at the moment, I think it is a good move because it improves retirement adequacy. But, at the same time, members may want assurance, as other House Members have said, of knowing that their payouts will commence and that the mechanism for paying out is sound. Could we consider starting with, perhaps, a lower payout at first at the PEA and then scaling up to the full payout at 70 or on application of the member?

The last question is, what is known right now about the use of payouts at the earlier PEAs, that is, are the payouts used for expenses or do they sit largely in zero percent or close to zero percent savings accounts? It seems that studying this and publicising it may allow the public to understand why we have this policy and how it helps them.

Mr Speaker, I thank the Member for his supplementary questions. Let me deal with the first one on retirement age.

In Singapore, together with Japan, besides the retirement age, there is actually the re-employment age. We are, to the best of our knowledge, the only two countries in the world that have the provision for re-employment. In the Singapore context, the re-employment age, when it was first implemented, was to age 65. This was in 2012. Then, in July 2017, we raised the re-employment age to 67. So, in fact, Singaporeans have the assurance of employment beyond the retirement age of 62, all the way up to 67. In any case, both the retirement age and the re-employment age are being reviewed. A tripartite workgroup was set up last year and is making good progress. I hope to be able to update Members during the Committee of Supply (COS) debate.

Let me turn to the second question. I believe the Member had suggested, if you are concerned about starting the payouts at 65, why not start with a smaller payout? I think it can be looked into, but I suppose the question the members will also have is: how do you decide what is a "small" payout? If you are going to start with a small payout, why not just start with the whole payout?

The third, I am very glad that the Member asked this question. What is the typical use of the payout? We do not have very clear indications about what happens to the payouts once they start being streamed out on a monthly basis. There is good reason to also not be too precise about the use of those monthly payouts because they will be co-mingled with contributions from other family members and perhaps, personal savings. It will be very hard to tease apart what part of that money can be attributed to CPF payouts or what part is attributed to children's allowances.

But what people do with their withdrawals at age 55 is instructive. Our survey suggests that slightly over half of the members, after taking the withdrawals from their CPF accounts at the age of 55, just put it in a bank account, earning much poorer interest rates. That actually is a very useful reminder that people are not always so savvy about what is the best deal that they can get on their savings. There is some merit to the current practice of automatically deferring it for them, because they get to earn a much better interest rate. When they want to start their payouts, it is still available to them anytime.

I thank the Minister for her very comprehensive response. I would like to refer to a recent exchange on the Forum Pages of Lianhe Zaobao on the CPF Retirement Sum Scheme. A CPF member had complained that CPF Board would stretch his payouts over 28 years until he is 93, when he thought it should be 20 years, on the assumption if the tenure was shorter, he would get more over these 20 years.

So, I would like to ask the Minister for Manpower the basis by which payouts for CPF RSS are calculated. So, how do you calculate? Why do you decide it is 28 and not 20? Can CPF members have the flexibility to choose the tenure of the payout period within the prescribed limits? And why do we still have the CPF Board maintain this CPF RSS and only apply to people with lower CPF balances, and not include everyone on the CPF LIFE Scheme, which I believe is a superior scheme?

Mr Speaker, may I have a second supplementary question which relates to this discussion about the important decision of starting at 65? The question the Minister could answer is whether a CPF member who has chosen payouts to begin at 65 – later found out it is a better deal to delay and want to stop the payout and ask to defer to 70, can this be done? If this request is made, how do you then calculate the payouts for the remaining period? Let us say this person has enjoyed it for a year and then ask at 66, "I want to defer to 70", what happens? And that would inform the decision some of the Members are asking for automatic trigger at age 65. What happens?

Mr Speaker, Singapore has one of the highest life expectancies in the world. In 2017, more than half, one in two Singapore residents aged 65 was expected to live beyond 85. One in five of them was expected to live to about 95 or above. When designing the RSS payouts, initially, they were meant to last 20 years, taking into account the base interest rate on the Retirement Account, which is now 4%. So, consider the fact that they will earn 4%, consider the fact that RSS payouts should last 20 years, then you work out what the payout will be.

A current RSS member reaching his PEA of 65 will get a base payout that will last till approximately 85. What this means, however, is that more than half of the members still alive at 85 will have no CPF payouts at all. This will be a major cause for concern. The better solution for the member to managing this longevity risk is CPF LIFE, which provides lifelong payouts. However, because CPF LIFE is mandatory only for those turning age 65 in 2023, with $60,000 in Retirement Account balance, most of our elderly will still not be on CPF LIFE but remain on the RSS.

With this concern in mind, the Government introduced the CPF extra interest about 10 years ago and the additional extra interest in 2016. This bonus interest, provided by the Government, is used to extend the RSS payouts beyond 20 years. In this way, the members will enjoy payouts for longer and there is less risk that their savings will run out. But we also put in a cap, so that the payouts do not extend past 95 years old. This will already cover about four in five elderlies. About 80% of them will be covered by this duration extension.

To the question of whether members can request for shorter payout duration under RSS. In general, the extra interest and the additional extra interest provided by the Government is used to extend the duration of the RSS payouts and reduce the risk of members outliving their savings. In some cases, the CPF Board allows flexibility for members to request for a shorter payout duration. For example, members may have topped up beyond the full Retirement Sum and would have their payout duration extended. They can come forward and discuss with the CPF Board how to get it shortened for higher payouts.

RSS members can also consider joining CPF LIFE. Because of risk-pooling, not only will they enjoy lifelong payouts, but they may also enjoy higher payouts. In fact, I am happy to share with the Member that about 92,500 RSS members have taken up CPF LIFE voluntarily. They were not mandated to do so, but they probably either did their own sums or visited a Service Centre, were shown what the payouts will look like under CPF LIFE and then decided on their own accord to sign up. The question is, why keep the RSS, why not make everybody come onboard? This is one of the challenges for CPF LIFE and indeed many Government schemes. When we introduce changes or new schemes, we have to be very careful to whom it applies. The RSS members were told that they were on RSS. We do not just decide on their behalf that they will henceforth be on CPF LIFE.

For newer cohorts, when CPF LIFE was introduced, it was made mandatory. That is because they have the benefit of advanced understanding and knowledge. But for those who were already on the prior scheme, we are very careful about changing things for them. The solution really is to reach out to them, show them how it works for them and let them decide.

To the Member's final question, on whether an individual, having started his payouts, can decide to stop and defer to 70. Here, I want to be very careful about not making a generalised statement. As I explained, the circumstance may differ for every individual. So, I would urge the member to come forward, we would look at his particular circumstances and if it serves his interest, it is helpful to him, we will see how to support him.

I thank the Minister. It is very important to encourage those with lower CPF balances to defer their withdrawal till 70 years old so that they can get a higher payout down the road. That is one of the key objectives of this scheme. Could the CPF Board consider providing even more incentive to encourage this group, such as those with less than basic Retirement Sum in their CPF balance an even higher tiered interest rate for their balances so as to give them more incentive to defer their withdrawal?

The incentives are already very generous. For every year of payouts deferred, those on CPF LIFE stand to get higher payouts of up to 7% more. If they defer it for all five years, they get up to 35% more. However, not everyone has hoisted this on-board. I am aware that the former Minister for Manpower, Mr Lim Swee Say, for example, has conducted multiple engagement sessions in his constituency, helping his residents understand the benefits of deferring their payouts. I would very much like to encourage all Members to do likewise. CPF Board will be very happy to support you in this endeavour. The incentives are there, it is very much for the CPF members to take advantage of them.

I thank the Minister for the clarification, as I think there has been so much confusion. Having that discussion is important.

I would just like to ask a supplementary question with regards to the default age of the payouts. I understand that the rationale for putting the default at 70 is to allow for the additional benefits to the member. But at the point of the letter going out to the members, is it possible to just make it simple for them to confirm if they wish to withdraw? I know they can withdraw at the start of PEA. But it is a matter of emphasis. So, can they allow for the member to just confirm whether he wishes to have the payment, starting at 65? Because it gives the assurance that they can do it. Today, it seems that it is the other way round. It is just a matter of emphasis. And if they say no, then you can do the rest of the communications on the benefits, or if they say yes, just to confirm with them the benefits of keeping it there. It is just to give the members the assurance that they can start the payouts.

The short answer is yes. We will have to take a look at the letters. I think it is best to message-test. It is probably best to gather some members and ask them which letter is intuitively easier for them to understand. We will do so.

Just one more question for the Minister. For members who did not want to start their payout at PEA, will they be reminded again every year until age 70?

Absolutely. They are reminded year after year, through the Yearly Statement of Account.

I thank the Minister for explaining the payout at 65 and 70. I have a specific question with regards to a certain segment of the population. For example, if somebody is mentally incapacitated before 65, will it affect his trigger at 70 or 65, in the situation where he does not have a Lasting Power of Attorney (LPA) at 65? How will the CPF Board handle this situation at the point when the person reaches 65 years of age? What I mean is that, if somebody is mentally incapacitated at 65 and he does not have an LPA, does he have to wait until it is triggered at 70? Or is there a specific situation in such circumstances?

I would not want to speculate. The specific circumstances may differ. But in principle, the same rules apply to this individual. If by 70, there has been no instruction received, the CPF Board will also stream out the payments. The challenge, of course, is whether you have the right details, such as bank account details. If he does not have the LPA, it would be very hard to see how the CPF Board could be instructed to start the payouts even before 70. But we will have to look at the specific instance, so I think best not to speculate.

I just wanted to clarify my earlier supplementary question. First, I think, the Minister mentioned CPF LIFE only applies to CPF members with minimum $60,000 balance. Why is that so? Why can we not let everybody enjoy CPF LIFE?

Everyone can enjoy CPF LIFE. But there are certain members whose balances are not very high. They might find a lifelong payout at those levels not very meaningful. Again, we do not presume to decide on their behalf. We say that if your balances are below a certain amount, it is better for you to decide and let us know. Quite a number have decided that they will come on-board. They are part of the 92,500 that I shared. Members not on CPF LIFE can still come on board. We will not deny them the opportunity to do so. It is just that we do not decide on their behalf.

10 Mr Louis Ng Kok Kwang asked the Minister for Social and Family Development in each of the past five years (a) how many ComCare Short-to-Medium Term Assistance recipients are first-time applicants; (b) what is the median monthly payout for first-time applicants; (c) what is the median number of months the first-time applicants have received the assistance; and (d) what percentage of first-time applicants have reapplied for assistance within 12 months of receiving ComCare.

Mr Speaker, ComCare is part of the multiple layers of assistance provided by the Government to support low-income individuals and families. Households that require help to tide over a period of financial difficulty are provided with ComCare Short-to-Medium-Term Assistance (SMTA). Depending on the needs of the household, our Social Service Offices (SSOs) may provide financial assistance in cash, help with household and medical bills, and refer them to agencies such as Workforce Singapore for employment assistance or Family Service Centres (FSCs) for further support. As the needs, profile and size of each household is different, the quantum and duration of assistance they require may also vary.

Between 2015 and 2017, the number of households that received SMTA at any point in time was between 14,000 and 16,000 households. We do not have readily available data on how many of these were first-time SMTA applicants. The median monthly assistance quantum that a household on SMTA received was about $400 and the median duration of assistance in a year was about six months. These figures exclude other forms of Government assistance and subsidies that households could be receiving, such as MediFund for medical expenses, subsidised rental housing, financial assistance for school fees or childcare subsidies and so on.

Among households whose SMTA ended in 2016, about 25% households reapplied and received SMTA within 12 months. These families may have faced new challenges or changes in their family, work or health circumstances. We do not have five-year data available.

Beyond these statistics, it is important to understand the challenges families face in overcoming their issues and the support that will help sustain their self-reliance. The Ministry of Social and Family Development (MSF) will continue to study these trends in close partnership with stakeholders in the community, particularly those who are working directly with families in need.

I thank the Minister for the reply. I have two clarifications. First, how can we ensure that we have a social safety trampoline, as Deputy Prime Minister Tharman has suggested, rather than a social safety net? So, how can we reduce this 25% repeat applicants?

The second clarification is whether MSF has studied whether, if we increase the duration of providing support during the first application, it would lead to a reduction in the number of times they will re-apply? Which means, if we help them longer the first time, the chance of them coming back to re-apply for ComCare would be reduced. So, maybe not six months, which is the median; but whether we have studied giving them nine months, and perhaps these applicants will not come back to apply for ComCare again?

Mr Speaker, I thank the Member for his abiding interest in seeing how we can establish a trampoline as well as a social safety net. A trampoline to help families with the potential to overcome the challenges to be able to stand on their feet and be able to support their own selves, and a safety net to catch those who fall through temporarily or even for a longer duration of time.

The Member may be aware that last year, we announced efforts to develop, all across the island, SG Cares Community Networks. These are networks of social and healthcare agencies within each town. We seek to integrate the support that all these organisations – both Government and people sector – can provide so that we can give more holistic assistance to families, especially those who face complex needs.

We also announced last year our intentions to launch hubs in rental housing estates so that we can bring together the agencies and the Voluntary Welfare Organisations (VWOs) that have been working very intimately and closely with families living in rental housing. As the Member may know, rental housing families tend to face a plethora of complex difficulties. With that integration, coordination and support amongst different agencies, we hope to better able to partner these families, tackle their issues holistically, chronologically, and systematically. Empower them, partner them, and support them. So, that is what we hope to achieve.

As I said earlier in my reply, ComCare is but one of a suite of assistance schemes that help to stabilise a family's needs, and meet their basic needs, whilst working with them to address other upstream issues.

On the Member's second point, I think what he meant was whether we should consider increasing the duration as opposed to what he said, "reducing the duration". Certainly, six months is the median. There are some families whose needs may be more short-term, for example, they may need, say, two to three months of assistance before they transit to a new job which they can secure with or without assistance; or they may require longer-term assistance because they may be undergoing more structural training, for example. So, median is median. There are those who get fewer than six months and those who get longer than six months.

The SSOs, together with our agencies, such as Family Service Centres, would assess the needs of the families holistically, and then make the necessary decisions as to what that appropriate duration would be. But going forward, we need to work together in a more integrated fashion with the community, with our VWO partners and with other Government agencies, so that we provide assistance in a way that empowers, and in a way that supports more effectively.

11 Er Dr Lee Bee Wah asked the Minister for Manpower (a) what is the employment screening process for foreigners applying for a work permit; and (b) in the past three years, how many applicants have been rejected because of their unsatisfactory records.

Mr Speaker, apart from assessing work permit applications on whether they meet our Work Pass rules such as dependency ratio and source, the applicant will also be screened for any security antecedents and adverse records. This screening of applicants helps to minimise incidence where undesirable persons are inadvertently allowed to work in Singapore. Between 2016 and 2018, around 8,400 applicants were rejected per year, on average, as a result of this screening.

I have one supplementary question. Many residents expressed concern about their maids borrowing money from unlicensed moneylenders and some have been sent back. So, they are asking when these maids apply to come back to Singapore to work, do we issue them work permits or is it on the Ministry of Manpower's (MOM) list that these maids are not allowed to come back?

Generally, as part of policy, as foreigners who have infringed MOM's regulations, they will have their adverse record marked. For this case, if the maids' employers want to appeal, they can certainly appeal, but I am not sure if the Member is asking for them to return, or she wants them black-listed.

Not to return.

Not to return. So, I suppose the employers also have an option to blacklist them as well for such adverse conduct, for example, that they want MOM to take note of. We will certainly take note and mark it in the list.

Does it mean that the employers have to report to MOM so that next time, the maids would not be allowed to come back because they are involved in unlicensed moneylending? Definitely, for those cases that Police is aware of, the maids should be stopped from coming back automatically, without needing the employers to prompt MOM.

When I talk about adverse conduct, when we talk about moneylending, it applies to unlicensed moneylending. If it is unlicensed, certainly, that is adverse conduct and so, it will go into the record without the need for the employer to report this.

12 Mr Ong Teng Koon asked the Minister for Manpower (a) whether overseas retailers of consumer goods are allowed to supply labour to install such goods in Singapore for Singapore customers if such labour do not have the requisite permits to work in Singapore; and (b) if not, whether the Ministry has any enforcement plans to keep the playing field level for local retailers.

Mr Speaker, foreigners working in Singapore must hold a valid Work Pass, and those who install consumer goods such as furniture and air-conditioning from overseas retailers are not exempted from this requirement. This helps to ensure that all businesses are operating on a level playing field.

Under the Employment of Foreign Manpower Act, illegal workers can be fined a maximum of $20,000 or subjected to imprisonment of up to two years, or both. The Ministry of Manpower (MOM) has also taken action to bar such illegal workers from entering and working in Singapore for up to two years. Anyone with information on such illegal workers should report to MOM. Information can be found on our website.

I wish to ask the Minister, as a clarification, whether she can give more assurances to small businesses. For example, a resident whom I visited was a furniture reseller. Can there be assurance that MOM is doing what it can to try and level the playing field to protect our businesses? A lot of them feel aggrieved that they have been prejudiced by retailers from Malaysia who cross the Causeway and help to deliver and install furniture in consumers' houses in Singapore.

Mr Speaker, I can give the assurance to the Member as well as the furniture retailers that we take this seriously. Every year, we take several hundred employers, several hundred of such illegal workers to task. It is not enforcement action in theory. Enforcement action is actually carried out. If there is any reason to suspect that such overseas retailers are indeed flouting the rules, please help us by letting us know so that we can take action.

Mr Speaker, I would like to ask the Minister whether she can clarify how we can take action against retailers who are registered businesses outside of Singapore.

Mr Speaker, we do not take action against them for being retailers registered outside Singapore. We are saying that if they carry out activities that are against our rules, let us know if you observe such incidents happening. Our enforcement officers cannot be in every household that is installing furniture. We rely very much on information. Of course, whenever the information is received, we also have to do our due diligence and to follow up quickly.

13 Miss Cheng Li Hui asked the Minister for Manpower whether the Ministry monitors and keeps track of the number of jobs lost to new technologies and automation vis-à-vis the number of jobs created in Singapore.

Mr Speaker, there is no internationally accepted conventions on estimating job creation or losses due to new technologies and automation, as the effect is both direct and indirect. However, in our national manpower statistics, we do monitor employment numbers, which have continued to grow even as technology and automation are transforming industries. In 2018, total employment increased by about 40,000 and that is excluding foreign domestic workers, with particularly strong growth in the technology intensive Infocomm and Media sector.

14 Assoc Prof Walter Theseira asked the Minister for Transport (a) whether the Government takes into account a shared bicycle operator's ability to meet financial obligations to staff, vendors and the public when considering licensing status; (b) when a licence is cancelled, whether any monies from security deposits and licence fees are made available for claims by vendors, employees and the general public; and (c) if so, what order or process shall apply to determine claim entitlements.

Mr Speaker, the Land Transport Authority (LTA) requires applicants for full bicycle sharing licences to submit audited financial statements for review and considers their financial standing when granting licences.

The licensing framework for bicycle-sharing operators focuses on regulating the indiscriminate parking of shared dockless bicycles. The licence fees which LTA collects from the operators are meant to cover regulatory costs, so that these costs are not passed on to taxpayers. The use of the security deposits is restricted to specific circumstances stated in the Parking Places Act. These are: serving as surety for an operator’s compliance with licence conditions or standards of performance, meeting any unpaid financial penalties imposed on an operator, and recovering the costs incurred by LTA in removing and disposing of bicycles, should an operator fail to do so after its licence has been cancelled. If none of these circumstances arise, LTA will not make a claim on the security deposit.

While the security deposit and licence fees may not be used to repay private debts, vendors, employees, companies and consumers who are owed monies by the operators have other recourse. Companies and consumers with claims against any operator can seek redress through the civil courts, while the employees can also approach the Tripartite Alliance for Dispute Management for assistance to resolve their salary disputes.

[(proc text) With Speaker's permission, Assoc Prof Walter Theseira asked a supplementary question to Question No 14 after Question No 15 had been dealt with. (proc text)]

15 Ms Sylvia Lim asked the Minister for Manpower since the inception of the Silver Support Scheme in 2016 (a) how many Singaporeans who initially received payouts were assessed to be ineligible in subsequent years; (b) what support does the Scheme give to those between the bottom 20% to 30% of elderly Singaporeans; and (c) whether the Scheme's criteria for household monthly income per capita of $1,100 will be reviewed to exclude the income of the applicant's siblings living at the same address.

Mr Speaker, the Silver Support Scheme targets support at the bottom 20% of elderly Singaporeans aged 65 and above. Coverage may, however, extend to include up to the next 10% of elderly. Eligible elderly receive cash payouts of between $300 and $750 every quarter, according to the type of HDB flat they live in. Recipients living in smaller flat types receive higher payouts. The median quarterly payout has been $600, corresponding to the payout quantum for eligible elderly living in a 3-room HDB flat.

The automatic means-test assessment is done annually to take into account changes in circumstances of the elderly, to ensure Silver Support reaches those with lesser means as the Scheme was intended to do. In 2016, about 143,000 elderly received Silver Support payouts. Of these elderly, 33,000 no longer received Silver Support in 2019. About 14,000 had passed away while 18,000 had seen their household incomes rise above the eligibility threshold. At the same time, 42,000 elderly who were not receiving Silver Support in 2016 were assessed to be eligible for Silver Support by 2019. So, there is a net growth. Overall, the number of elderly eligible for Silver Support and the total annual amount paid out to recipients have been increasing each year. Right now, the Silver Support total payouts annually is about more than $330 million.

The Ministry of Manpower (MOM) will review the Silver Support Scheme from time to time to ensure that it continues to provide meaningful support to the elderly who had low incomes throughout their lives and who now have little or no family support. We will also continue to assess appeals from those who have missed the income criteria on a case-by-case basis.

I have two supplementary questions for the Minister. The first is, I would like her to clarify whether the scheme target group remains the same. In other words, is it still targeted at the bottom 20% of the elderly, with some support for those between 20% and 30%? Because lately, some of the collaterals, including replies that we have received from the agency, do not seem to mention this second group of those between the bottom 20% and 30%. So, I would like the Minister to clarify whether this group between the bottom 20% and 30% is still within the target of the scheme.

The second supplementary question concerns sibling income. The Minister has earlier said that the Ministry will review from time to time the relevance of the means testing criteria. I would like to ask the Ministry to pay special attention to the consideration of sibling income, as the sibling would probably be of the same generation and also elderly, and if both of them are living together, it is likely that one or both of them do not really have other family support. So, it would be good for the scheme to look at those cases on a more generous basis.

Mr Speaker, to the Member's first question, yes, the target group has not changed. It remains the same.

On sibling income, I should give a little bit of background as to why we used per capita household income. The whole idea is that if people are living in the same household, it is more reasonable to expect that they are providing mutual support to each other. There are, of course, other ways of measuring a person's level of support. You could, for example, include their family members who do not live in the same household. But having considered the different options and assessed which one of it is more intrusive to establish, we finally settled on using the household income. I accept the fact that within the same household, the level of support may not be identical. So, for those who are non-family members, in other words, for example, they are unrelated people living in the same household, we do not include their income. But if they are related, including siblings, their incomes are included. However, if on a case-by-case basis, there is reason for us to consider otherwise, then we will also assess them.

The following question was moved earlier –

Assoc Prof Walter Theseira asked the Minister for Transport (a) whether the Government takes into account a shared bicycle operator's ability to meet financial obligations to staff, vendors and the public when considering licensing status; (b) when a licence is cancelled, whether any monies from security deposits and licence fees are made available for claims by vendors, employees and the general public; and (c) if so, what order or process shall apply to determine claim entitlements.

I would like to provide a bit more airing on Question No 14. Assoc Prof Walter Theseira, do you want to follow up?

Mr Speaker, thank you for your indulgence. I first have a clarification. First, I just want to clarify from the Senior Minister of State that regarding the security deposit, other than statutory purposes laid out in the Parking Places Act, is the Senior Minister of State saying that any remaining sums will be forfeited into the Consolidated Fund and will not be available to any private claims? I just wish a clarification there.

Then, I have a supplementary question in general. As we know, this is a regulated activity which forms an important first- and last-mile link in our public transport system. So, I just want to clarify that stakeholders, the public, would have expectations that the licensees have been scrutinised by the Government and because of those expectations, I wonder if the Government could consider whether it can at least protect, for example, the employees and the commuters who perhaps have a greater expectation that the licensee has been properly regulated than perhaps the vendors who are commercial companies engaging in business-to-business transactions with their eyes open.

Mr Speaker, I would like to thank Assoc Prof Walter Theseira for the supplementary questions. I think the answer to the Member's first question is correct: the remaining sums will not be available to private claims. Based on the current Parking Places Act, the purpose is as laid out in the reply that I have alluded to just now.

With regard to the Member's subsequent question, we have started this licensing regime for bicycle sharing operators very recently. In fact, we have only started this for a couple of months and we are actually looking at how this will pan out. The main purpose of this licensing regime is to manage the indiscriminate parking situation that we have faced in the past. If you look at the current situation, since the implementation of this licensing regime, there has been some improvement. But we are still closely monitoring this situation. And we hope that, with time, we will be able to see whether we need to make adjustments in order to accommodate what Assoc Prof Walter Theseira has suggested.

16 Ms Anthea Ong asked the Minister for Manpower what steps is the Ministry taking to (i) leverage the investment and efforts by Workforce Singapore to include and integrate unemployed but employable persons with disabilities into the Singapore core and (ii) advise and collaborate with social sector agencies to ensure that persons with disabilities are prepared adequately for the future economy to prevent them from further marginalisation.

Mr Speaker, under the Adapt and Grow (A&G) initiative, Workforce Singapore (WSG) and its partners provide job matching services and programmes to help jobseekers overcome mismatches in skills, wages or job expectations. Persons with special needs can tap on these services too, as well as the programmes to find suitable employment, particularly the Open Door Programme (ODP) and Career Trial. In the past three years, more than 1,600 persons with special needs have been placed, that is, found jobs, found placements, through these programmes.

The ODP, which is administered by SG Enable, provides dedicated support for employers to hire, train and include persons with special needs in the workplace. The programme provides employers with recruitment and job support services, as well as grants to redesign jobs for persons with special needs to upgrade their skills and even train co-workers to work better together with persons with special needs.

Some employers may be unsure whether a particular person with special needs would be suited for the job, while persons with special needs may also be unsure whether the job and work environment are suitable. Therefore, we have the Career Trial programme which offers an opportunity for jobseekers to train and work for employers for a short stint of three months, during which time the jobseeker receives a training allowance from Workforce Singapore (WSG). Since April 2018, all persons with special needs who are hired after the trial will receive retention incentives and their employers will also receive salary support.

Under the Third Enabling Masterplan, the Ministry of Social and Family Development (MSF) has been actively engaging persons with special needs and their caregivers to better understand their aspirations, needs and challenges. The Government is also working closely with social service agencies and other partners in the private and people sectors to improve education, training and job placement for persons with special needs and identify suitable employment opportunities for them.

Mr Speaker, I thank the Minister of State for the clarification. As to what concerns me, and I think I have got to share with Members of the House that last week, it was reported that in terms of the number of people with disabilities who are in employment which was given by MSF as 8,600 to a Parliamentary Question I filed; against the total number of people of disabilities, we are looking at a percentage of about 4.88%.

So, in itself, without even comparing to what or how the other countries are doing, I would like to ask the Ministry and maybe even MSF, is there something of a national target that we are internally working towards? At 5%, given the resources we have and how fast the nature of work is changing, I do fear that this group of people with disabilities would be further marginalised. It will not bring them into the workforce and, on top of that, also continue to upgrade and prepare them for the future of work. Could I please ask the Minister of State what sort of plans do we have in that regard?

I thank the Member for her supplementary question and, certainly, as an aspiration, we are both aligned. We want to see more inclusive workspaces here in Singapore. Specific to that article, I think much of the data was picked up from data available in the public space. However, in recent years, the Government has also started to collect more comprehensive data on persons with special needs. So, in the meantime, just bear with us because we will be releasing more accurate estimates of the employment and unemployment rates for persons with special needs later this year, once we have a better picture of the situation.

But overall, if you look at where we are today compared to, say, four or five years ago when we first set up SG Enable, then subsequently we developed WSG to come in to support, we have worked quite closely to look at how we can improve employability. I think the situation has improved, as I have mentioned. Today, we have got 1,600 being placed in the last three years. Certainly, we can do better. But if you look at the schemes out there, are there enough schemes? Perhaps, it can be improved. But what are the schemes like? If you look at the Open Door Programme, for example, we give training grants of up to 90% to employers to employ persons with special needs. And if you look at the Job Redesign Grant, for example, we also support up to 90%, capped at $20,000 per special needs worker for employers to redesign jobs to employ them, to modify their work environment and processes to be more inclusive for persons with special needs.

On top of that, if you look at the Special Employment Credit, the Government provides up to 16% wage subsidy to employers to employ persons with special needs regardless of age for those above 65. This goes up to 22% of wages for employing someone with special needs who are more senior.

So, to a certain extent, overall, there is support, but what I hope is that we can get more enlightened employers on board. We want employers to be enlightened. I think Members of this House have friends, neighbours, industry contacts, employers who can help and join this inclusive workplace initiative or aspiration for all of us. Certainly, we can all do more. But I hope that we can get more employers on board because the engines are there, the schemes are there. Certainly, we can all work together towards this aspiration.

17 Mr Louis Ng Kok Kwang asked the Minister for Manpower whether the requirement for reporting work-related or workplace accidents can also include cases where an employee who meets with an accident is placed on light duty by the doctor for more than three days, whether consecutive or not.

Mr Speaker, today, reporting is required for all work injuries resulting in medical leave of more than three days, consecutive or otherwise, or hospitalisation for at least 24 hours. This is in line with the reporting criteria in other developed countries, such as those in the European Union.

We are studying the possibility of making it a requirement to report all work injuries resulting in any instance of light duty or medical leave. This has been included in the public consultation on amendments to the Work Injury Compensation Act (WICA) which was launched just this year in January. It will allow us to have a more comprehensive picture of the extent of work injuries and will help improve the targeting of prevention efforts. We will share more details when the proposed amendments to WICA are finalised this coming April.

Sir, I thank the Minister of State for the reply. Can I just confirm that we are having a list of specified injuring similar to what the UK has, which is that regardless of the number of medical certificates (MCs) or number of days of light duty, mandatory reporting is required?

The second clarification is whether we can follow what we do for occupational diseases where it is the doctor that reports the occupational diseases rather than the employers, that is, whether the doctors will in the future do reporting for work-related accidents rather than the employers?

At this moment, what I can commit is that we are looking at all forms of injuries that result in light duty medical leave. Specific to the list in the UK, I cannot confirm right now. But may I suggest that the Member submits another Parliamentary Question so that we can make a comparison. I have not done a comparison for this particular Parliamentary Question but, generally, all work injuries that result in light duty medical leave will be covered in the new WICA, subject to some of the consultation exercises that we are having.

The second question was with regard to the practice with doctors. That is to be further studied. Let us take it up with the Ministry of Health (MOH) to study this.

18 Mr Dennis Tan Lip Fong asked the Minister for Social and Family Development (a) what are the specific steps that the Government is taking to recruit 3,000 preschool teachers by 2020; and (b) considering that less than 1% of preschool educators are men, whether there are plans put in place to recruit more men into this sector.

Mr Speaker, the Government has been investing in the early childhood sector to provide families with access to affordable and quality preschool. To support the expansion of the preschool sector, we have put in place measures to attract more people, both men and women, to join the sector. At present, there are around 18,000 preschool educators in the sector. We will closely monitor our efforts to grow the sector as we aim to meet our targets.

To attract more post-Secondary students, the newly established National Institute of Early Childhood Development (NIEC) plans to admit about 700 students to their new Diploma in Early Childhood Development and Education programme for Academic Year 2019, which is double the intake in 2015. The Early Childhood Development Agency (ECDA) also offers training awards to encourage students to pursue Early Childhood courses at the NIEC and the Singapore University of Social Sciences (SUSS). These awards provide students with full sponsorship of their course fees, learning resource grants, professional development grant, monthly study allowances and professional networking opportunities, and that are pre-employment efforts. Now, I move on to mid-career transitions.

To attract more mid-career entrants, we have rolled out the Professional Conversion Programme (PCP) for Preschool Teachers and the Place-and-Train Programme (PnT) for Educarers. People who are looking to switch careers or re-enter the workforce can apply for these programmes, and can earn a salary while undergoing a mix of on-the-job coaching and classroom-based teaching or training. To facilitate their entry to the sector, the Government provides subsidies for the training courses and salaries. I move on to skills pathways.

To provide greater clarity on the career pathways and opportunities for Early Childhood professionals, ECDA, with industry partners, had introduced the Skills Framework for the Early Childhood Sector. This is supported by moves to retain and support in-service professionals to deepen their skill competencies, such as Professional Development Programmes (PDPs) and the ECDA Fellows Programme. ECDA has also been working with Anchor Operators to enhance the career prospects for their educators by creating 1,000 more senior professional positions by 2022.

Apart from manpower programmes, we have been working with industry partners to streamline work processes and reduce educators' administrative workload under the Industry Transformation Map (ITM). More recently, ECDA rolled out a National Campaign for the Early Childhood Sector to create greater awareness of the sector and career opportunities, and to foster greater respect and recognition of the profession.

Through these efforts, we have seen more people, including men, who are interested to join the sector today. Over the last five years, the intake of mid-career entrants enrolled in professional early childhood certificate or diploma courses have increased by more than 70%. The intake sizes of Pre-employment Training students for similar courses have also increased by two times, with the proportion of men enrolled in the diploma courses doubling.

In tandem with the expansion of the sector, salaries for early childhood professionals have been rising steadily. Based on ECDA's 2016 survey, basic salaries for educarers with a professional Certificate range from about $1,800 to $2,100 per month, salaries for teachers with a professional teaching Diploma range from $2,200 to $3,000, and salaries for principals with a professional leadership Diploma range from $3,100 to $6,000. These salaries have increased by about 15% since the previous survey in 2013, outpacing that of the general market for similar job sizes which grew by about 8% over the same period. Also, based on the 2017 Polytechnic Graduate Employment Survey, the starting salaries of full-time early childhood Diploma fresh graduates have increased by about 20% to $2,300 since 2013. ECDA expects salary growth for early childhood educators to continue to outpace that of the general market.

ECDA will continue to work with NIEC and other partners to create more progression opportunities and areas of specialisation, such as in Mother Tongue Language teaching, Learning Support and Early Intervention, and Outdoor Learning. Some of these areas, such as Outdoor Learning, may provide scope to attract more men to the sector, which at this point in time is a very low proportion.

Together with its partners, ECDA will press on to uplift the early childhood profession and ensure that the preschool sector provides rewarding and meaningful careers.

I thank the Minister for his comprehensive reply. Just one supplementary question. Could the Minister please share, what are the challenges that the Ministry have faced in trying to increase recruitment in this area as a whole?

There are whole range of factors which we have assessed that may make it competitive to bring in more people into the early childhood sector. One of them, of course, is more qualitative – it is people's perception of what an early childhood sector job entails. And there are certain common misconceptions that an early childhood educator is a nanny or a caregiver, rather than a teacher, a person who guides and grows a child in the early years of their development. So, to address that, we have launched, last year, a national campaign. Having consulted many members of the profession about what kinds of misperceptions people may have and testing with them to see whether it resonates with them. Some of the messages, videos and profiles that have gone out seek to address people's minds, for both those who are considering entering the sector, and of course, the parents who influence and guide their children on what kinds of jobs to aspire towards, to have a more accurate view on the importance of early childhood.

Science and data have shown that good early childhood education impacts not just the cognitive development of the child, but the holistic development of children – ages zero to three, zero to six, these are very important ages, and we want to grow the sector.

We attract most of our entrants through career conversion. Many people, after working in various sectors, decide that they want to enter the sector. And we find that that is also a very stable group of people. In fact, three quarters of those joining the sector becoming educators in the preschool sector are mid-career entrants, with the remaining one quarter coming from the Pre-employment Training sector. And the PCP and Place and Train have been very helpful in that regard. One quarter of those who are mid-career entrants come under the Place and Train and PCP.

So, mindset is one, creating pathways is another to attract people into the sector.

The Member also asked about men, whether we are able to attract more men so that we grow the pool of potential applicants into the sector. And I have spoken to senior educators because I wanted to understand this phenomenon when I joined the Ministry of Social and Family Development (MSF). You know there are very, very few men who are preschool teachers. In fact, I just met one last night at some event. One preschool teacher who was a man and the rest were women. When I speak to preschool senior educators, they talk about cultural factors. They say that firstly, there is a mindset amongst people that the preschool sector is more suited to women. Women are very good carers and educators, but I think men can also equally play a role in that regard. But there is this mindset.

A second belief, believe it or not, some of the senior educators told me that some parents are not comfortable with male teachers, for example, showering children and many preschools across the sector decide to allow only women to shower children. And of course, all these play a part in the cultural mindset.

So, a whole range of factors, but as I have given in my comprehensive reply, we are tackling them: cultural mindset, misconceptions, salaries, progression pathways, mid-career pipelines, specialisations, senior positions and pathways that assure people that they can grow in the sector by picking up certain skills. So, we continue in this regard, and we hope to achieve our targets as stated.

Order. I would like to announce a very generous budget for tea break, not in terms of quantity or quality, just in time. And just to state that there is no bearing on the generosity of the Budget later either. So, I suspend the Sitting and will take the Chair at 3.30 pm.

Sitting accordingly suspended

at 2.54 pm until 3.30 pm.

Sitting resumed at 3.30 pm.

[Mr Speaker in the Chair]

Mr Speaker, I beg to move, "That Parliament approves the financial policy of the Government for the financial year 1 April 2019 to 31 March 2020."

This year marks 200 years since Sir Stamford Raffles landed in Singapore. Archaeological finds and records show that Singapore’s history stretches back at least 700 years, serving as a trading emporium in the region.

The year 1819 was a key turning point in Singapore's development. The British decision to declare Singapore a free port plugged us into an emerging network of global trade. This, and subsequent developments, transformed Singapore into a global node. In our bicentennial year, let us reflect on the twists and turns in our history so as to chart a path forward for an even better future for our people.

Today, we are in a different phase of globalisation, with new forces reshaping the global environment. In last year's Budget Statement, I mentioned three major shifts: (a) the shift in global economic weight towards Asia; (b) rapid technological advancements; (c) and changing demographic patterns.

A fourth major force that is gaining prominence is the decline in support for globalisation. Some countries are benefiting from globalisation, while others are questioning its value. These four major forces are interacting in complex ways, at the global, regional and national levels.

On the global stage, the trade frictions between the US and China are developing into a deeper strategic competition of strength and of governance systems. This is raising geopolitical uncertainty. Closer to home, ASEAN has enjoyed over 50 years of peace and stability, with bright economic prospects. Together, the 10 economies of ASEAN are projected to become the fourth largest in the world by 2030, with the size of the middle-class doubling. Innovation and entrepreneurship are also thriving. In recent years, Southeast Asia has grown several new "unicorns", or companies with valuations in excess of US$1 billion.

Working together, ASEAN nations can maximise our potential. But, closely connected neighbours will have occasional differences.

A couple of issues have surfaced recently with Malaysia. When such differences occur, Singaporeans must stay united as a people and present our positions firmly and calmly. We have worked through difficult bilateral issues with our neighbours in the past, based on mutual respect and common interests and in accordance with international laws and norms. Singapore will continue to seek to resolve issues in the same spirit.

Domestically, we need to address longer-term challenges, including ageing, social mobility, inequality, economic transformation and climate change.

The changing global and domestic landscape presents both challenges and opportunities. We will continue to chart our way forward confidently in the Singapore way, building on our distinct strengths and our Singaporean DNA.

We must respond to challenges with grit and determination. There were episodes in the centuries of Singapore's history where our island’s fortunes waned due to external forces. These are sobering reminders that we have to constantly build up our security and resilience, and plan long term.

Singapore's success has roots in our port, which thrives on openness and connectivity. These traits have been forged into our identity as a people. As a multicultural society, our openness to diversity is our strength. It has inculcated a global mindset and deepened our knowledge of Asia. We must continue to cultivate cross-cultural literacy among our youth and encourage them to build bridges with peoples across the world. We strive to be a place where people and ideas congregate at the frontier of global developments. We want to be a Global-Asia node of technology, innovation and enterprise.

We turn our size and strategic location into an advantage. Technological shifts have spread economic activities more widely and, at the same time, made cities more important as key nodes of enterprise and innovation. As a city-state, we are nimbler and can adapt to changes faster. We serve as a neutral, trusted node in key spheres of global activity. Like Sang Kancil, the small but quick-witted mousedeer, we can make our way in the world.

Budget 2019 is a strategic plan to allocate resources to build a strong, united Singapore. In this bicentennial year, let us draw on our strengths, and our Singaporean DNA – openness, multiculturalism, and self-determination – to continue to progress.

At a fundamental level, we must keep Singapore safe and secure. This allows us to preserve our way of life and forge our own destiny. We must continue to transform our economy, for only a vibrant and innovative economy can provide opportunities for our people to realise their potential. We must continue to build a caring and inclusive society, one where we look out for one another, and all of us play our part in weaving a tightly knit social fabric. We must continue to build Singapore as a global city and home for all, keeping it smart, sustainable and globally connected. Last but not least, we must achieve these goals in a responsible and fiscally sustainable way.

We are using our financial resources to help realise our strategies for a strong, united Singapore. But financial resources alone do not get us there. We call on all Singaporeans to partner with the Government and support one another to succeed in this endeavour.

A safe and secure Singapore gives us the confidence to chart an independent course. But we cannot take our peace, prosperity and stability for granted. Singapore is vulnerable to the fluctuations in our region and the world.

Against an increasingly uncertain geopolitical environment, our commitment to defence and security cannot waver. Diplomacy and deterrence are the twin pillars of our approach.

The Ministry of Foreign Affairs (MFA) works continuously to build good relations with our neighbours and the major powers and to promote a rules-based international order with international laws and norms. A strong Singapore Armed Forces (SAF) lends weight to our diplomatic efforts and ensures that negotiations with Singapore are taken seriously. Should diplomacy fail, we must stand ready to safeguard our interests and defend ourselves. The Home Team also works round-the-clock alongside other security agencies, to ensure a safe environment for all. We also now have the Cyber Security Agency of Singapore leading our efforts to protect our Critical Information Infrastructure from cyber threats, and to create a secure cyberspace for businesses and communities. These are fundamental to our sovereignty, our success and to safeguarding our vital interests.

Singapore is one of the safest cities in the world. Our crime rates are consistently low, but we must not be complacent.

Security threats are evolving and becoming more complex. A strong SAF remains a bulwark against threats to our way of life. Terrorism threats to Singapore remain high. We continue to detect individuals in Singapore who have been radicalised by terrorist propaganda. Globally, we see a rise in attacks perpetrated by radicalised individuals and cells. Such attacks are hard to prevent. We must stay vigilant.

Beyond physical threats, malicious cyber activities are growing. The networked nature of our society has enhanced connectivity. But this can be exploited to disrupt and divide society through cyberattacks, the spread of falsehoods or other means.

In particular, foreign actors will try to influence our domestic affairs and politics. This is not new, but new technologies have made it easier for others to mount attacks with greater ease and intensity and with more sophisticated tactics.

To stay ahead of these threats, we must continue to innovate and build new capabilities to meet our security needs. Both the public and private sectors have a major role to play.

The Ministry of Home Affairs (MHA) will set up a Home Team Science and Technology Agency by the end of this year to develop science and technology capabilities to support the Home Team's operational needs. These capabilities will strengthen the Home Team’s ability to carry out its mission of safeguarding Singapore. The Minister for Home Affairs will speak more about this at the Committee of Supply (COS).

The private security industry has been stepping up efforts. A good example is Certis, which has redesigned its business processes, infusing technologies such as big data and artificial intelligence (AI) to deal with security threats.

MHA will also help to transform the private security industry through innovation and technology to meet growing needs and be an effective partner to the Home Team.

Our Total Defence approach will continue to keep Singapore safe and secure, with every Singaporean playing a part. At the national level, we plan long-term and take measures, such as stockpiling critical supplies, diversifying our sources of water supply, and strengthening our food security. As a people, we must have the psychological and emotional resilience to face crises stoically. As threats get more sophisticated, Singaporeans must stay vigilant and guard against non-conventional forces that threaten to divide us.

National Service (NS) has forged a deep understanding in our people that each and every one of us has the duty to defend our nation. When our young people serve NS, families and employers support them in every way possible.

With our Smart Nation drive, digital technology has become an integral part of our lives. To harness the digital advantage, we must be prepared to also deal with the threats that arise inevitably from its more pervasive use.

Digital Defence has now been incorporated as the sixth pillar of Total Defence.

Like the other pillars of Total Defence, Digital Defence involves everyone – individuals, community groups, businesses and the Government. We must all play our part to be secure, alert and responsible online, be it through practising good cyber hygiene, being vigilant against fake news and helping one another use technology safely.

Last year, the Ministry of Defence (MINDEF) launched the Cyber National Servicemen scheme, training National Servicemen (NSmen) with the Singapore Institute of Technology (SIT) to raise our cyber defence capability.

The Government is also engaging our tech community with programmes, such as the Government Bug Bounty Programme, to achieve a higher level of collective cybersecurity.

Given its strategic significance, the Government will continue to invest a significant share of our resources – about 30% of our total expenditure this year – to support our defence, security and diplomacy efforts. This spending is significant, but indispensable. We will invest more, if the need arises, to protect the sovereignty of Singapore and the well-being of Singaporeans.

Everyone has a role to play to keep Singapore safe and secure. Let us continue to stay united in defending our home and our way of life.

A vibrant and innovative economy provides our people with the opportunities to realise their potential and to have a better life.

Our efforts to transform our economy are bearing fruit. In tandem with the global expansion, the Singapore economy grew by 3.2% in 2018. Good growth translated into good outcomes for our workers. Over the past five years, the real median income of Singaporeans has grown by 3.6% per year. Global growth is expected to moderate in 2019, while uncertainties and downside risks in the global economy have increased.

Over the years, our sound monetary and fiscal policies have enabled us to weather global economic crises and keep inflation stable. These provide a stable environment for investors to make long-term investment decisions.

Beyond maintaining a supportive macroeconomic environment, we need to build a sound microeconomic foundation, so that resources can be allocated to their best possible uses and to undertake structural reforms to enable our workers and firms to adapt and stay competitive.

Every firm and every worker will need to work differently, master new skills and use technology well. And we must continue to create new opportunities, including through partnerships with others.