Hansard, Monday, 26 February 2024

1 Mr Darryl David asked the Minister for Home Affairs in view of the announcement by ICA on 13 February 2024 that all foreign visitors to Singapore can soon clear immigration at the air, land and sea checkpoints using automated lanes by the second half of 2024, whether there will still be dedicated lanes at these immigration checkpoints set aside exclusively for Singaporeans and permanent residents.

Mr Speaker, the Immigration and Checkpoints Authority (ICA) will still set aside lanes for dedicated use by Singaporeans and Permanent Residents (PRs). The proportion of dedicated lanes will be flexibly adjusted to meet prevailing operational needs, taking into account the traveller profile.

Mr David.

I would like to thank the Minister of State for the reply. I am heartened to know that there will still be dedicated lanes reserved for Singaporeans and PRs and, more importantly, that these lanes will also be used or made available, based on the demand at the checkpoints. Just a supplementary question, Sir, which is, I understand that right now, there could be some Singaporeans – especially the younger ones – those who cannot use the automated lanes – children and so on – and their families, therefore, have to travel with them. I would like to ask the Minister of State if there are some measures that could be taken also to enhance the flow of such families of Singaporeans or PRs who might not be able to use the automated lanes through the checkpoints?

Sir, I thank the Member for the question. It is a very important question and a good question, I must say. In fact, I visited Terminal 2 recently, during the festive period, to thank our officers for working during the festive period; and among the facilities that I saw was the special assistance lane. These are for families, especially those with young children, and also for those with additional needs. We had the lane very, very, very wide and it enables even those with very young children to go through. They can pass through as a group, as a family. So, if you look at what we have shared recently during the statistics release, we are building some of these lanes. For some, we have completed; for example, Terminal 2 that I visited, it is completed. And we are among the first, if not, the first in the world, to have these facilities.

This is something that we continuously think about, especially when we go towards the New Clearance Concept, where we want to enhance the travelling experience for not only our residents and PRs, and Singaporeans in particular. Because this is something that we want to make sure of: that when they go out of Singapore and then, they come back to Singapore, they feel not only happy when we land at Changi Airport or pass by our checkpoints, but they have the ease of entry to make it easy for them.

So, we will continue to look at how we can enhance the travelling journey process of our Singaporeans.

2 Mr Yip Hon Weng asked the Deputy Prime Minister and Minister for Finance (a) why was GST charged wrongly by Government agencies; and (b) whether the Ministry can share on plans, such as to leverage more on technology as well as simplified rules and processes, to prevent similar situations from happening in the future.

3 Dr Tan Wu Meng asked the Deputy Prime Minister and Minister for Finance (a) what are the root causes for the wrong charging of GST on the 18 Government fees which were incorrectly designated as processing fees rather than regulatory in nature prior to the November 2023 review; (b) whether the Ministry maintains an overview of such fees; (c) whether the Ministry previously provided specific guidance to agencies on such interpretations; and (d) whether there have been prior appeals or legal challenges to the interpretation of fees and, if so, what are the outcomes.

Mr Speaker, my response will cover Oral Question Nos 2 and 3, and Written Question Nos 2 and 3 on today's Order Paper, as well as related questions by Mr Don Wee1, Ms Joan Pereira2 and Mr Leong Mun Wai for subsequent Sittings.

May I please have your permission to proceed, Sir?

Please proceed.

Thank you. Sir, Government fees may be regulatory or non-regulatory in nature. Fees imposed for purposes of control and regulation are regulatory in nature, and the Goods and Services Tax (GST) should not be charged; whereas fees for the provision of services such as the use of public sports facilities or rental of hawker stalls and exhibition spaces are non-regulatory in nature and GST applies in such cases.

Each Government agency, like any GST-registered business, has to assess whether its fees should be GST-chargeable whenever a fee is introduced or revised. Agencies do so based on the law. The Ministry of Finance (MOF) and Inland Revenue of Authority of Singapore (IRAS) also provide guidance to agencies on what constitutes regulatory fees.

Members asked how the issue was identified. It was picked up by MOF and IRAS as part of our regular internal review of the GST regime. We discovered inconsistencies in the application of GST on certain Government fees in November 2023 and concluded the review in January 2024, with 18 regulatory fees identified to have charged GST wrongly and need to be refunded.

As most of these 18 fees are for the processing of applications, rather than licence fees, agencies had deemed them to be taxable provisions of services. For example, an agency had charged GST on the application fee for a licence but had not charged GST on the licence itself. The correct treatment should have been to not charge GST on both the application fee and licence fee.

Businesses or individuals who wish to appeal against the GST treatment for any Government fee can lodge an objection with the Comptroller of GST or an appeal with the GST Board of Review. To date, there have been no cases relating to Government regulatory fees.

Sir, we have put out the facts and the remedial actions that will be taken. As announced on 14 February, the agencies involved have ceased charging GST on the 18 fees and will refund all affected taxpayers with interest of 5.5% per annum.

The refund will minimally cover transactions since 1 January 2019 as the agencies, as GST-registered entities, are required by law to keep records for five years. Where records and updated banking details are available, agencies will proactively and automatically credit the refunds to individuals and affected businesses. Otherwise, agencies will contact taxpayers to provide or update such information before refunds are effected. If affected taxpayers are not contacted by agencies by 30 June 2024, they can reach out to the agencies to seek a refund. In cases where the affected company has been dissolved or the individual is deceased, agencies will make refunds to the Official Receiver and the executor, administrator, or Public Trustee respectively.

The agencies should be able to refund the vast majority of the affected taxpayers. But if there are any unrefunded amounts, then they will be considered part of the Government’s GST collections and broader tax revenue used for nation building purposes.

Mr Yip Hon Weng, Mr Huang and Mr Leong Mun Wai asked how the Government will guard against future recurrence, for example, by leveraging on technology. As the issue did not arise from a lack of technology but from differences in the interpretation of law, we will simplify and clarify the rules and processes to provide greater clarity on regulatory fees where GST should not be charged. MOF will table a Bill soon to amend the GST Act to clarify the GST treatment for such fees, and to prescribe a list of regulatory fees where GST should not be charged. This will make clear which fees are regulatory in nature. This approach will also help to address any cases where GST should have been applied, but agencies failed to do so.

Mr Leong suggested to exempt all Government fees and charges from GST. As mentioned earlier, there are fees that are charged for the provision of services, like public sports facilities. Some of these services could well have been outsourced to private sector providers, or there may be businesses providing similar services. GST should therefore be applied consistently to such services, regardless of whether the entity providing the service is from the public or private sector, so that there is parity in tax treatment. Other countries with GST systems also adopt similar principles.

Sir, the Government is committed to upholding high standards of governance and integrity. We will continually review and improve our processes, and where feasible, we will incorporate the suggestions from hon Members.

Mr Yip Hon Weng.

Thank you, Mr Speaker. I thank the Minister for his response. I have two supplementary questions. How will this incident inform future internal audit processes by the Government of similar fees and charges? Secondly, what is the assessment of the potential impact of this error on public trust in Government financial management, and what steps will be taken to rebuild trust and prevent similar issues from happening in the future?

Mr Speaker, to Mr Yip's first question, we are going to table a Bill in Parliament soon to amend the GST Act. As I explained in my main reply, we will prescribe a list of the regulatory fees where GST should not be charged. I think this will provide clarity and take away the uncertainty for all stakeholders, whether is it the agencies or public officers who are involved in administering these fees, or taxpayers, because there is a prescribed list of such fees where GST should not be charged.

Sir, I also want to highlight that we take this issue of integrity and governance very seriously. That is why when MOF and IRAS came across the inconsistencies in November last year, we did a thorough review of all the regulatory fees and charges. By January, we completed the review and we identified that there are 18 fees altogether that would need to be rectified and the GST that is wrongly collected, will have to be refunded to taxpayers. I think this is the approach that we will take. It does not mean that we do not make mistakes, but when we discover that mistakes are made, we will be upfront, we will be open and we will deal with those mistakes. We will rectify the errors and we will make good.

Mr Lim Biow Chuan.

Sir, just two questions for the Minister. First, could the Minister clarify – why was this not spotted by the Auditor-General over the past years when they audited the Government processes and accounts?

Second, the Minister said that the refund would be made together with interest at 5.5% per annum. Could I ask the Minister how does the Ministry compute the interest payable on the GST that was collected erroneously? Previously, when I wrote to Government to ask about how interest was charged, the Government told me that MOF has a policy of charging 8.1% on interest for refunds, when residents could not pay back the Ministry, whereas the Government is refunding at 5.5%. So, how does the Ministry determine this interest payable?

Mr Speaker, I believe Mr Lim will agree with me that the Auditor-General's Office (AGO) is an independent statutory organisation, so, I cannot answer on behalf of AGO. But I believe AGO has put out its explanations as well, on this matter.

The second question about interest rates, the rate of 5.5% was set referencing the prevailing interest rate for Government refunds over the affected period and that is the average prime lending rate, compiled by the Monetary Authority of Singapore (MAS) from leading banks and licensed companies. Sir, I cannot comment on the earlier figure that Mr Lim cited. Maybe he could forward to me more information and we will look into that.

4 Mr Gerald Giam Yean Song asked the Minister for Communications and Information (a) whether the Government has set specific targets for Singapore's global share of aggregate computing power over the next five to 10 years; (b) if so, what is this target share and by when; (c) which agency is responsible for this initiative; and (d) what interim milestones will the Government use to track progress.

Sir, no such target has been set. The amount of computing resources needed in Singapore will depend on the workloads that the private and public sectors expect to process and how these workloads are distributed. This will change dynamically in response to needs and available alternatives.

Mr Gerald Giam.

I thank the Senior Minister of State for his reply. Can I ask if the Government is pushing for more data computing power in the country, in other words, building more data centres? If so, how would the Government ensure that Singaporeans directly benefit from these developments and we create a more level paying field for everyone to access such computing power, including microenterprises, students and individual Singaporeans?

Secondly, what are the Government's sustainability considerations with regard to data centres, given that data centres consume a tremendous amount of energy which contributes to the carbon footprint and environmental impact in Singapore.

Mr Speaker, Sir, are we pushing for more data centres? The answer is yes. I would refer the Member to our digital connectivity blueprint as well as documents associated with how we have called for more applications for data centres which conform to sustainability measures – in answer to his second question. These have been published, where we are pushing for the data centres that are located in Singapore to be more environmentally friendly, to be more sustainable in terms of the energy used for computing, the software that runs on them, as well as how they maintain their facilities, the cooling standards.

How will Singaporeans benefit? Well, again, I would refer to the various documents that we published, looking at how we are digitalising a variety of industries and this digitalisation of the industries should, through these strategies, result in better jobs. We are also trying to make sure that Singaporeans have the training and skills necessary to take advantage of these opportunities that are brought here.

Assoc Prof Jamus Lim.

Sir, I understand Senior Minister of State Janil's argument about why the total amount of processing power that the country will have will depend, of course, on a balance between the public and the private sector. But given the stated goal of the Government in its national AI strategy to push for applications within the Government, I wonder if there are at least plans to consider ramping up, especially graphical processing units acquisition, because this is so critical to ensuring foundational AI model development, including that by the Government sector.

Sir, the answer is yes. I would refer the Member to the digital connectivity blueprint which stated exactly that. That is distinct from the question that Mr Giam had asked, which is, whether there is a target of the proportion that we would have or the amount of compute, and that is a separate issue which is how we match needs to the demands. So, are we ramping up? Yes. Do we have a set absolute target? No such target has been set.

5 Assoc Prof Razwana Begum Abdul Rahim asked the Minister for Culture, Community and Youth how does the new Singapore Government Partnerships Office plan to build and maintain respectful, age-appropriate and on-going partnerships with children and young people under 18 years old.

Sir, citizens, including youths with Singpass access, can submit their partnerships proposals through the Partners Portal on the Singapore Government Partnerships Office's (SGPO's) website. These proposals would then be referred accordingly to Government agencies which would work in partnership with these citizens to realise their proposals.

In the case of partnerships with citizens under 18 years of age, SGPO has given guidance to Government agencies not to enter into any legal contracts with them. SGPO has also advised agencies to obtain written consent from the citizen's parent or guardian as part of the process of taking the proposal forward and to ensure that the nature and risks of the undertaking or activity are disclosed fully to the guardian or parent when obtaining consent.

Assoc Prof Razwana.

I thank the Senior Parliamentary Secretary for his response. I welcome the opportunity made available to young people over the age of 18. My concern here is: how are we getting inputs from our young people?

So, my supplementary questions are, if the Ministry is not in a position to engage directly with children and young people under 18 years of age, how does the Ministry tend to ensure that the views of children and young people are known and considered by the partnerships office?

My second question is: would the Ministry consider working with children and young people under 18 years of age, parents and guardians, schools and sporting and community groups to scope possible mechanisms to ensure that the views of children and young people are known and considered by the partnerships office?

Sir, I thank Assoc Prof Razwana for her supplementary questions. On the first supplementary question, SGPO actually collaborates with various Government as well as non-Government entities to take in the viewpoints of all stakeholders, and that includes children and young persons as well. While direct engagement may be a challenge for certain age groups, we remain committed to create avenues for representation, including partnerships with youth-focused organisations, grassroots organisations, grassroots' initiatives and through surveys, as well as other outreach mechanisms. So, like the Member, we want to ensure that there is meaningful inclusion as well as consideration of children and young persons' views and perspectives.

My answer to the second supplementary question is broadly linked to the first one and the answer is yes, we will be working to scope possible avenues to take in the views of children and young persons.

6 Mr Louis Ng Kok Kwang asked the Minister for Education for each year in the past five years (a) what is the number of teacher counsellors employed in schools in Singapore; (b) what is the average percentage of teachers who are teacher counsellors in each school; and (c) how many hours of counselling training do these teachers undergo.

Mr Speaker, teacher counsellors are part of an ecosystem of tiered support for our students, which includes the school counsellors, community resources, other teachers, peers and parents. Working together, they provide a caring environment for our students to grow and thrive.

For all students, in addition to imparting academic content, teachers impart important habits and skills to strengthen our students' socio-emotional well-being and resilience. This is done through lessons and regular interactions with students. Among teachers, form teachers play a key role in supporting students' well-being and growth through building a positive class community. Schools have also put in place peer support networks to enable students to offer socio-emotional support to one another.

Students who require more specialised counselling support are attended to by trained school counsellors beyond the peer support and teacher counsellor support frameworks. Every school has one to two school counsellors, who can be augmented by flexi-adjunct school counsellors, depending on the needs of the school. Students who require more specialised interventions are referred to health professionals and community resources like REACH and Family Service Centres.

Teacher counsellors supplement counselling support in schools by taking on a few less complex cases or support programmes that promote student well-being. There are close to 800 teacher counsellors deployed in our schools today. Teacher counsellors undergo relevant training to better support their students, such as a part-time Certificate in School Counselling course and other short courses, such as a one-day course on Psychological First Aid. To manage their workload, teacher counsellors have reduced teaching load or are offloaded from other school duties.

We also believe that parents play a key role in helping their children acquire self-management skills, take responsibility for their actions and bounce back from setbacks. Schools will continue to work closely with parents to develop their children's social and emotional competencies, including through our Parent Support Groups.

Mr Louis Ng.

Sir, I thank the Second Minister for the reply. I think the Second Minister gave the number of teacher counsellors for all the schools. But could I just ask for part (b) of my question on what percentage of teachers in each school are teacher counsellors?

Second, it is an important point that a lot of counsellors tell me that to be a counsellor, they require at least a Master's degree in counselling, because it is difficult work and requires specialised training. So, could I ask again whether we are setting our teachers up for failure by asking them to do even basic counselling work? The Second Minister mentioned maybe a one-day training; is there sufficient training for these teachers to be able to carry out this specialised work?

Third, it really is also what I have been pushing for. The teachers are overworked. Is it really needed for them to do this extra work, or could the Ministry of Education (MOE) set aside some funding to hire more school counsellors who are able to help the students better and essentially help the teachers as well?

Sir, on the question of the proportion, it varies from different schools. As I have mentioned earlier, there are about 800 teacher counsellors who are spread out to all our schools. So, it is hard to say what is the percentage across all the different schools. But suffice to say, first, I want to reiterate the distinction between school counsellors and teacher counsellors.

The one that Mr Louis Ng talked about in terms of requiring specialised training, for example, Master's degree in counselling, they are our school counsellors. They are the ones who will do the real counselling work for the cases which are more complicated, more complex, that require more intervention. And most of the cases in schools are handled by the school counsellors. And the school counsellors do not do the teaching. They just do the counselling work.

But the question that Mr Ng asked is about teacher counsellors. The teacher counsellors augment the work of the school counsellors. And that is the reason why the training is on psychological first aid; they are the ones who help the less complex cases. They are the ones who, when the school or the class form teachers identify a student who is manifesting some challenges, they are referred to the teacher counsellors and the teacher counsellors will try to support and help them. And they are less complex cases.

So, the teacher counsellors are not expected to do the kind of counselling that require Master's level qualification. They are asked to support less complex cases. And when we talk about the teacher counsellors, I just want to highlight that when we identify the teachers, we do not just identify whoever that we think, "Oh, you should do it and the school needs these teachers". We identify teachers who are suitable and have interest. They, first, must have the interest to want to do more than just teaching and a predisposition to provide counselling, intervention support, as well as those with some prior counselling experience and training. There are some teachers who were former social workers. So, they already have got some training in counselling experience.

Some teachers who came from the social service sector do have some experience already and we ask them whether they are prepared to do so. So, they are teachers who have already had some background. They take on the role and they are very committed and we know they have done a lot of work.

Sir, on the workload of teacher counsellors, I want to again make the distinction between the teacher counsellors and the school counsellors. The school counsellors are the professionals who have been recruited by MOE to deal with the more challenging counselling cases. Within the school system, as I have mentioned previously, we have structures and systems in place to ensure a manageable workload for all our staff. For instance, the Teacher Work Management Framework guides schools in managing teachers' workload and ensuring that teachers' well-being are taken care of. This includes recommending off-loading practices for teacher counsellors where, depending on the amount of time that they spend a week on their counselling duties, their workload is correspondingly reduced.

So, for example, teaching fewer classes or taking less co-curricular activities or committee duties. So, if you are a teacher counsellor, depending on how much counselling you are doing, you are off-loaded from other teaching duties; just to be fair to the teachers. And the school leaders are given the guideline within this framework to be able to help the teachers.

So, besides implementing these off-loading provisions, school leaders also adopt a holistic approach in deploying teacher counsellors to ensure that their work is sustainable. This takes into consideration factors, such as the nature of the subject that they teach, the frequency and intensity of the teacher counsellors' marking load, including class sizes, level, streams assigned and/or student profiles.

So, every school has got its school staff developer, and this school staff developer or designated key personnel would monitor and track the training and deployment of teacher counsellors in the school. So, I want to assure Mr Louis Ng that we know the teachers have done a lot of work and they continue to do a lot of work. We recognise that; we appreciate it. We are fully aware of the amount of work they have put in. Some have gone beyond the call of duty in doing so.

We will do our best within the school system and not every school is the same because the needs of the schools differ. And with the framework and guidelines we have given the school leaders, we hope the school leaders will be able to be fair to all the teachers within the school manpower. And we also hope that if teachers who feel that they are being loaded with more than what they can handle can go to the school staff developer in the school, talk to the school leaders and manage the workload within the construct of the team in the school.

Order. End of Question Time. Introduction of Government Bills.

[Pursuant to Standing Order No 22(3), provided that Members had not asked for questions standing in their names to be postponed to a later Sitting day or withdrawn, written answers to questions not reached by the end of Question Time are reproduced in the Appendix.]

[(proc text) "to provide for the issue from the Consolidated Fund and the Development Fund of the sums necessary to meet the estimated expenditure for the financial year 1 April 2024 to 31 March 2025", (proc text)]

[(proc text) recommendation of President signified; presented by the Second Minister for Finance (Mr Chee Hong Tat); read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY2024/2025, and to be printed. (proc text)]

[(proc text) "to make supplementary provision to meet additional expenditure for the financial year 1 April 2023 to 31 March 2024", (proc text)]

[(proc text) recommendation of President signified; presented by the Second Minister for Finance (Mr Chee Hong Tat); read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY2024/2025, and to be printed. (proc text)]

[(proc text) Order read for Resumption of Debate on Question [16 February 2024] [1st Allotted Day], (proc text)]

[(proc text) "That Parliament approves the financial policy of the Government for the financial year 1 April 2024 to 31 March 2025." – [Deputy Prime Minister and Minister for Finance]. (proc text)]

[(proc text) Question again proposed. (proc text)]

Mr Pritam Singh.

Mr Speaker, it is not mere coincidence that the slogan of Forward Singapore is "Building Our Shared Future", while that of Budget 2024 is the substantially similar "Building Our Shared Future Together". The Government intends for Budget 2024 to be a step towards Forward Singapore.

The Forward Singapore exercise has three major goals for the decade and the next. Singapore must: first, have a strong and growing economy; second, develop a fairer society; and third, deepen our sense of unity. In doing so, the shared future that was distilled from various engagement sessions with the public was a Singapore that will be vibrant, fair, resilient, inclusive, thriving and united.

Sir, it would be fair to say that these are broad strokes that capture the Singapore that all of us seek. In the way it fleshes out the direction of the Government, Budget 2024 is not objectionable, and so the Workers' Party (WP) supports the Budget.

The real challenge to the People's Action Party (PAP), however, is for it to be open, and the extent to which it is prepared to accommodate the diverse views of Singaporeans on how to journey towards the destination envisaged by Forward Singapore. No doubt, PAP has asked for diverse views by demanding that the Opposition come up with alternative proposals, although one suspects they do so rhetorically. WP has responded sincerely and we have not been short of proposals that have ultimately been accepted by the Government in some shape or form, albeit after initial and sometimes significant resistance.

Indeed, this year's Budget includes WP proposals; the announcement by the Finance Minister of a temporary financial support scheme for our workers is a case in point. While the details may differ, the philosophy of supporting our involuntarily unemployed is one which WP championed.

The same can be said for the WP proposals for anti-discrimination legislation to better protect our workers. Unlike PAP, WP clearly stated these proposals in our election manifesto, and our Members of Parliament (MPs) have systematically and repeatedly raised these points along with others in Parliament.

Mr Speaker, let me now put forward five points which form the basis of my response to the Budget.

First, the Government needs to be more forthcoming with information so that Singaporeans can participate more actively in policy discussion. Second, there is a growing mismatch in Singapore between aspirations and reality, which must be addressed. Third, the Government must improve retirement adequacy. Fourth, employers need to show more support for employees. And fifth, we must work towards further strengthening unity among Singaporeans in this uncertain world.

My first point is that the Government needs to be more transparent and forthcoming with information so that there can be meaningful participation by Singaporeans in the most critical matters affecting us. This is a recurring theme in my speeches, but I am by no means the only Singaporean to hold this view.

The Straits Times carried an article dated 19 February 2024 titled, "Economists applaud 2024 Budget but some worry about sustainability." The economists quoted were concerned about the combination of large cash handouts with the lack of information about the sources of Singapore's fiscal strength. In the report, one former Nominated Member of Parliament (NMP) called on the Government to provide more information on how it funds its expenditures.

Another economist noted that Singapore is unique and does not follow standards set by global bodies, such as the International Monetary Fund (IMF), with regard to the difference between revenues and expenditures in the management of the fiscal balance. Yet another economist was quoted as saying, "As a society, we now have some very important choices to make and, unless we are well-informed, we will not be able to make those choices well." Sir, the latter point was about the Reserves, a subject which we debated earlier this month and where WP set out its five points of principle.

On 20 February, an opinion piece in The Straits Times was titled, "It's getting harder to project future Government revenue". The author noted that it would become more difficult to achieve Budget marksmanship as there could be variations of 17% to 27% in specific tax collections. His view was that gone are the days when Budget marksmanship of 2% was normal.

Two Budgets ago, I asked what the total estimated amount collected by the carbon tax would be. The Government did not tell us, even though the preliminary numbers would not have been difficult to estimate and probably had already been tabulated by the Ministry of Finance. Similarly, in 2016, the Government announced a $4.5 billion industry transformation roadmap. No proactive update on how monies were spent on these programmes was provided until Parliamentary questions were put to the Government. Surely the Government can do better here.

I have spoken about the Organisation of Economic Cooperation and Development (OECD) Base Erosion and Profit Sharing regime, or BEPS, for some years now. The Finance Minister has laid out two possibilities that could affect us: one, of more corporate income tax being collected; and another of some multinational enterprises (MNEs) leaving Singapore. Both could happen at the same time, if recent media reports are anything to go by: one, predicting the move of more MNE headquarters to Singapore from Hong Kong; and another reporting on the move of Electrolux's regional headquarters from Singapore to Bangkok.

In view of the implementation of Pillar 2, what are the estimated collections in either an optimistic scenario or a conservative scenario?

At the first Budget debate of this term, WP called for the setting up of a Parliamentary Budget office, which was rejected by PAP as an idea that would only benefit the Opposition. In the spirit of Forward Singapore and in view of a greater need to track the effectiveness of Government policies and their expenditure outcomes, such institutions should be a feature of our democracy and the Singapore that the Forward Singapore report demands.

One economist quoted in the 19 February The Straits Times article said that Singaporeans outside this House desire to analyse and understand to a deeper degree what the Government is doing. These examples I shared put into relief the types of differences we can expect between the political Opposition in this House and non-politician Singaporeans outside of it on the one hand, and the PAP Government on the other. Such calls for information cannot be set aside as red herrings. If the Government was doing well on this score, we would not have private sector economists making the arguments and the points they do.

These calls represent a desire to shape a political environment that is fit for Singapore's purposes. Singaporeans need to know how much there is to spend and where the money comes from. These are basic requirements for having rational discussions on fiscal matters and for realistic alternative visions to emerge. In any democratic society, the Government must facilitate such discussions and it should do so proactively by declassifying more information if necessary. Sengkang Group Representation Constituency (GRC) Member Ms He Ting Ru will speak on the themes of deliberative democracy, transparency and accountability in her speech.

Coming back to the financing of Forward Singapore's goals, the Deputy Prime Minister announced that $5 billion of this Budget has been set aside for Forward Singapore policy moves, with around $40 billion to be used by the end of the decade. Will the Government spell out these initiatives in view of the commitment made in the Budget Statement, since some thought appears to have been applied to how much it will take to fund Forward Singapore plans?

Sir, PAP must tell us how the Government will deploy the $40 billion for Forward Singapore policies so that Singaporeans can understand what PAP believes the social compact of tomorrow requires. Just as PAP calls on WP to lay out its alternatives, surely PAP must lay out its proposals, too.

Mr Speaker, my second point is that there is a growing mismatch between the aspirations of Singaporeans and the reality facing them. Steps must be taken to address this. A reference in the Forward Singapore report to the 5Cs of decades past was scrutinised by some in the media. The 5Cs captured the aspiration to have cash, car, credit card, condominium and country club membership. The Forward Singapore report calls on Singaporeans to move beyond the 5Cs towards wider definitions of success. Surely, that is an admission, perhaps unintended, that a fair number of the 5Cs are unattainable for most Singaporeans today.

But I would go further. The reality is that things are very difficult for not a small number of Singaporeans, regardless of what definition of success one deploys. A Business Times article from late 2023 reported the findings of an OCBC financial wellness survey. Fewer Singaporeans can comfortably spend on things beyond the basics. And more do not have sufficient emergency funds or savings to meet their families' needs. Just 40% of Singaporeans can afford to spend beyond the basics most of the time, down 8% from 2022; and 23% can only afford the basics; while 79% of Singaporeans either do not have a retirement plan or are not on track with their retirement plans. This was a rise from 71% in 2022.

If the sentiments captured in this survey are anything to go by, there is a likelihood that the social compact may be precarious and uneven, particularly if the middle of society feels insecure about their financial future. To address this possibility, the structural moves to invest more in the future, particularly through SkillsFuture, are important and critical, even as the temporary cost of living support with the Budget are acknowledged and welcomed.

The WP foresees a need for even greater investments in our human capital in future, especially in view of how rapidly the workplace landscape is changing and with more well-paying jobs requiring high-order skillsets, a point that will be further expanded by Sengkang GRC Member Assoc Prof Jamus Lim.

The $4,000 SkillsFuture credit, which is ringfenced for selected programmes with better employability outcomes, can be used for part-time diploma, post-diploma and undergraduate courses as well as PWM-specific courses. The WP sees the deployment of SkillsFuture credits towards economically productive courses with employment outcomes as an important policy initiative of this Budget. But we believe that many of the courses are likely to cost more than $4,000.

To further facilitate skills training and help Singaporean workers, the Government should introduce an interest-free SkillsFuture education loan. The WP put this proposal front and centre in our General Election 2020 manifesto. To start with, these loans can be calibrated towards courses, in either high-growth industries that lack Singaporean manpower or in other economically important areas.

Sir, my third point, is that the Government must improve retirement adequacy. The changes to the Central Provident Fund (CPF) Special Account (SA), announced by Deputy Prime Minister, will be addressed by Sengkang Group Representation Constituency (GRC) Member of Parliament Mr Louis Chua.

However, I speak of retirement adequacy more broadly and as an ongoing concern for the decades to come. It did not escape many Singaporeans, that all three core components of the Majulah Package: the annual earn and save bonus, the one-time retirement savings bonus and the one-time MediSave bonus, for Singaporeans born between 1960 and 1973, involved CPF top-ups. The Merdeka and Pioneer Generations will also get them. In total, 1.4 million Singaporeans will see CPF top-ups.

From the vantage point of the WP, Sir, these moves make it clear that sufficiency of CPF balances for retirement is a serious and ongoing concern. The moves to raise employer's CPF contributions through to the year 2030, must also be seen by employers in this light – of ensuring that all the workers are not left behind when retirement beckons. Employers will have to redesign jobs, so that seniors can continue to work for far longer if they wish to. The real risk of more redundancies in the years to come, arising from job displacement, adds impetus to the need for job redesign.

Recently, in a social media post, the Minister for National Development celebrated the 60th anniversary of the Housing and Development Board's (HDB's) Home Ownership Scheme. History shows that the reception to the HDB Home Ownership Scheme, per se, was initially lukewarm. The popularity of HDB flats exploded only when the CPF Act was amended in 1968, allowing Singaporeans to use their CPF funds for down payments and mortgage instalments of HDB flats.

It would not be hyperbole to say: that the CPF changed from a statutory board in charge of Singaporeans' retirement to a subsidiary of the HDB, with the aim of helping Singaporeans purchase property. Of course, many aspects of CPF policy have evolved since then.

But what is clear, is that Singapore is in a far different place compared to where it was in the early years of Independence. Specifically, younger Singaporeans cannot expect the same home equity appreciation that Singapore experienced from the 1990s. Today, HDB affordability continues to remain an ongoing concern in the minds of many Singaporeans, in spite of the new Build-To-Order (BTO) classification system – which adds new restriction and increases subsidies for new flats.

In substance, the Government appears to acknowledge the point that affordability is an ongoing concern. A point made by the WP in our speeches during the Housing Motion that was debated in Parliament last year, when we sought to bring focus to the People's Action Party's (PAP's) amended Motion.

It was not coincidental that the Prime Minister in his 2023 National Day Rally, referred to the now infamous $877,000 five-room BTO flat in Ang Mo Kio as an example of a BTO flat that should become slightly less expensive under the new Standard, Prime and Plus BTO classification system – thanks to added taxpayer subsidies.

More money set aside for HDB flat purchase means less funds available for retirement, notwithstanding options to downgrade. If property prices and general inflationary trends rise faster than wages, plans for retirement will have to start later for many – since they would have less to set aside for their nest egg, with mortgages to serve today.

It is time to closely examine how much CPF money should be set aside for housing. But if HDB prices continue to escalate, any move to reduce the CPF funds that can be set aside for housing, in favour of retirement adequacy, may backfire.

The Government may then have to commit itself to making HDB flats even more affordable by increasing subsidies further. Make no mistake, direct subsidies for HDB flat purchases do not make HDB flats cheaper. They merely transfer the cost to current taxpayers. The WP will continue to closely monitor PAP's moves on this point. We will be sure to hold it to account, if it allows HDB flats to continue to rise in price beyond wage growth and if it allows the retirement adequacy of Singaporeans to be compromised. My colleague, Aljunied GRC Member of Parliament Mr Faisal Manap, will make some related points covering housing and low-income households in his speech.

Mr Speaker, my fourth point, is that employers need to show more support for employees. Business groups have expressed concerns about the new Local Qualifying Salary cap of $1,600, which is widely considered as the de facto minimum wage.

However, if Singapore really wishes to embrace the philosophy of Forward Singapore, then we need to show stronger support for our financially vulnerable workers. This is such an important ingredient of the future social compact. Increases of the de facto minimum wage, should be seen as a step towards an inclusive and fair Singapore. If we have a shared future, where there is a lack of support for paying our lowest-paid workers in step with economic fundamentals, that would reflect very poorly on Singapore.

When the economy grows or when support measures are extended to companies, workers must also benefit. But consumers too, must be prepared to pay more for goods and services and it cannot solely be left to businesses to absorb the additional cost of wages.

The strongest social compact promised by Forward Singapore, also offers an opportunity to think about protections for our workers beyond wages. Much has been said about the lack of recognition in Singapore for all blue-collar workers who use their hands to perform skilled work. As the next step, Singapore should legislate retrenchment benefits or introduce redundancy insurance for these workers. I will speak more about this in the Committee of Supply (COS) debate for the Ministry of Manpower.

But there are areas where some employers have done well and displayed solidarity with the Singaporean worker. For example, by implementing Flexible Work Arrangements (FWAs) in concert with the demands of a more modern Singaporean workforce. But FWAs are just one area. We must also improve workplace culture and change attitudes towards skills upgrading and training, if Forward Singapore is to become a reality.

In a recent Ipsos survey titled "What Singapore thinks, feels and does", it was revealed that three in five Singapore employees – or 60% of Singapore employees – said that they were proud to work for their employer. But this was some 14 to 19 points below the global average; 29% said that they plan to leave their current employer in under two years – nine points more than the global norm.

While pay is one reason, feeling unrecognised and a lack of career progression, are the two additional factors that drive employees to leave. With the advent of artificial intelligence (AI) and the need to improve productivity, this is as good a time as any to significantly review HR policies: to align them with national imperatives and the lived experience of Singapore workers. Member for Aljunied GRC Mr Gerald Giam, will speak more about productivity improvements in his speech.

A citizens panel on employment resilience concluded, as part of Forward Singapore, noted that many workers did not proactively manage their careers until a need arose – due to a lack of awareness of resources for upgrading; or to there being too much information that is too daunting to navigate.

The SkillsFuture Enterprise Credit aims to encourage employers to invest and enterprise, and workplace transformation. It covers an array of programmes, including support for job redesign under the Productivity Solutions Grant. These initiatives can be superimposed on the key HR workplace pain points identified by employees – particularly older workers. Aljunied GRC Member of Parliament Ms Sylvia Lim will speak more on this subject.

This year's Budget sees the SkillsFuture Enterprise Credit extended for another year. As in previous years, the WP calls on the Government to report on the success, or otherwise, of these enterprise schemes that cause huge amounts of money. Reporting on outcomes is a fundamental requirement for accountability. Please give us information on what outcomes, if any, have been achieved on an industry-wide level. Please let us know so that this House and industry experts outside this House can give inputs on how these schemes can be improved, if necessary.

Sir, I move to my final point. In this uncertain world, Singaporeans need to be committed to being united even as we must remain multiracial and multicultural.

The Budget speech By Deputy Prime Minister Lawrence Wong, sought to put into focus an important message that many of us overlook as we remain peaceful and far removed from the prospect of conflict. The segment of the Finance Minister's speech that stood out for me was the assessment of the uncertain outlook for Singapore. Some language was particularly strong. These include, and I quote: the international outlook has darkened dramatically; the post-Cold War era that fostered three decades of peace and stability is over; we are now in a new era of conflict and confrontation and there is no turning back; what can we expect in this new world? It will be more violent, it will be more fragmented, it will be messier and more unpredictable.

At the same time as the world is seeing rising political polarisation and disenfranchisement, due to economic displacement, the world continues to struggle with common global problems, such as climate change, a subject Hougang Single Member Constituency Member of Parliament Mr Dennis Tan will touch on.

If Forward Singapore seeks to refresh the social compact to keep our society strong and united and to prepare for a difficult road ahead, all of us in Singaporeans – regardless of our political persuasion – will have to be our siblings' keeper. More so than ever before.

But this will not be easy. Immigration and integration are good examples of where potential challenges lie. Earlier generations of immigrants had little choice, or less choice, but to integrate. They could not live hermetically sealed off from their host population. Only 30 years ago, it was prohibitively costly to make an international phone call.

Current immigrants can easily stay connected to their networks and countries of birth. One can be a new Singaporean or PR physically present in Singapore, but removed from Singapore society. Better integration between the races and communities must be an important feature of the new social compact. We ignore this social objective at our peril, given how immigration is a permanent feature of Singapore's society.

The prospect of constant information operations undertaken by state and non-state actors, is an acute threat facing all multicultural societies. As a multiracial and multi-religious society that relies on immigration to top-up the population, our bonds as one united people may be severely tested in the years to come.

The reality of online misinformation of foreign interference, particularly if framed in nationalistic terms, or in the form of identity politics, can be insidious and highly damaging to Singapore.

Even as we seek more space to passionately advocate our views, including those on race and religion, we should be mindful lest we denigrate another group. More communication is certainly needed, but we should never forget our common humanity. None of us chose to be born into our race or religion, so kindness and empathy must be a dominant feature of the multiracial Singapore spirit.

As an opposition party with elected Members of Parliament (MPs) in Parliament, the Workers' Party will not self-censure but commit ourselves to bring up matters responsibly. Once mistrust between communities take root, we will not know what hit us.

The WP agrees with the posture taken by the Government, that polarisation must not happen in Singapore. And as a society facing an unpredictable world, we should not dismiss this potential reality. We must gird ourselves against this prospect by deepening our commitment to fellow Singaporeans and representing them and their views faithfully.

A potentially more volatile outlook also reinforces the importance of the Singapore Armed Forces (SAF) and Home Team and the importance of National Service. Our security agencies may be tested or challenged in ways that may not just be kinetic, but asymmetric, and we cannot afford to fall short. All Singaporeans must give our men and women in uniform our full support.

In conclusion, Mr Speaker, there is broad agreement on the outcomes sought by Forward Singapore.

But the call for a fair, inclusive and united Singapore must also accommodate and respond to citizen demands for greater transparency and civic participation. Otherwise, Forward Singapore could easily fall victim to political cynicism.

The WP has, on numerous occasions, proposed how these calls for greater transparency can be better addressed. Such calls will not grow softer and they are not inconsistent with the findings and the desired outcomes of the Forward Singapore exercise.

Some of the differences between the PAP and the WP are of methods and approaches, and we must agree to disagree. But there may be a few issues where there is consensus on the final outcomes, and yet, others where there is none. This is how a parliamentary democracy works. A Singapore with a contested and balanced Parliamentary system, with a robust opposition presence playing its role in making for a fair and inclusive society, and ultimately, what it does is that it makes us a better, more confident and an authentic Singapore. Sir, the WP supports the Budget.

Mr Liang Eng Hwa.

Mr Speaker, Sir, this year's Budget sets out the first instalment of policy moves to remake Singapore's social compact, as envisioned by the Forward Singapore exercise.

We can see the imprints of Forward Singapore in many aspects of this year's Budget, including the various fresh approaches and moves to provide assurance to Singaporeans. There are major initiatives to develop our people, to invest in medium- and longer-term capabilities and security, to support families and seniors, and to build a fairer and more equitable society.

We are moving forward amidst a more uncertain, more contested and more volatile world. To adapt and thrive under this environment, we need to keep on reassessing our propositions and norms, but also, critically, to stay cohesive and united.

Sir, let me start with the Budget measures to tackle the immediate challenges. And in keeping with one of Forward Singapore key thrust that we are in this together and that we have got each other's back, this Budget continues to enhance the packages to help Singaporeans cope with the cost of living.

The $1.9 billion enhanced Assurance Package (AP) may come across as "more of the same", but this is a much welcomed "more of the same", where it is actually more than "more of the same". Even though there are other measures and tools to help mitigate rising costs; nothing beats having more direct payouts and assistance from the Government. And fortunately, we continued to have the fiscal capacity to dish out such upsized packages.

For the businesses, while the 50% corporate tax rebate and the Enterprise Financing Scheme, among others, may also come across as more of the same, the minimum cash payouts of $2,000 to all companies that employed at least one local employee is clearly a new feature and, if I remember correctly, first of its kind in our Budgets. It will go some way to provide relief to the small enterprises and helping to mitigate some of the incremental costs.

In addition to the AP, there are also other helpful features in this year's Budget that help Singaporean households and businesses cope with rising costs, such as the Workfare Income Supplement, the Silver Support, the preschool fee caps, the Progressive Wage Credits Scheme and so on.

So, I thank the Deputy Prime Minister and Finance Minister for his continuing assurances to help Singaporeans to manage the cost pressures.

Besides the annual Budget measures, in September last year, the Deputy Prime Minister also came up with an additional off-budget $1.1 billion Cost-of-Living Support Package. In that package, there was also an additional one-off public transport subsidies of $300 million to moderate the fare increase in 2023. And this is over and above the $2 billion annual subsidy that the Government provides to keep public transport affordable.

I hope that that the Government would continue to monitor the costs situation, including keeping an eye on the public transport fare; and to consider another one-off assistance to moderate the fare increase if the Budget position permits.

Sir, let me now speak on the part of the Budget that I am most delighted with – that is developing our people.

Our people must be at the centre of any policy formulation and intent; whether it is to grow the economy, to build capabilities, to strengthen our securities and even why we manage our finances prudently. We want our people to live a full and happy life. A major part of our life's pursuit is livelihoods. We work to earn income to provide for our families and ourselves; to live good lives and to have the financial means for contingencies and retirement.

As a Government, nothing can be more of a priority and worthy than to help provide good and fulfilling livelihoods to our people. That must be the foremost key performance indicator (KPI) for the Government. However, with the rapid technological advancements and a more competitive and disruptive economic environment, long-term job security will be an increasing and ongoing challenge. The skills set that we acquire in schools and in the workplace now has a shortened shelf life. Some old jobs will become obsolete, while new jobs that require new skills will be created. And coupled with that, on the labour supply side, with an increasing healthy life span, we can now have a longer career runway. We are living longer and we have more healthier years in our life; thanks to the quality of life that we enjoy today.

Singaporeans understand this imperative and know that there may a time in their career where they need to do a pivot, in response to the changing landscape. The introduction of SkillsFuture 10 years ago opened up our mindset about continuous learning throughout life. Budget 2024 provides a major boost and a significant funding upsize to the SkillsFuture movement; with the aim to nudge Singaporeans in their forties, fifties and even sixties to embrace career resilience and to stay up to speed on their employability.

The SkillsFuture Level-Up Programme, with various subsidies, can greatly help to reduce the economic costs for training, a perennial pain point for the working mid-careers. The monthly training allowance, equivalent to 50% of one's average income, capped at $3,000 and over 24 months, helps to significantly buffer the economic costs for workers when they embark on career transition programmes.

The $4,000 top-up of the SkillsFuture Credit for Singaporeans aged 40 and above is a sizeable uplift and a clear signaling in the way forward. It is now more targeted in scope; and would only apply to programmes that can achieve the desired employability outcomes.

Sir, another notable shift in Budget 2024 is the change in our education subsidy policy; where Singaporeans aged 40 and above can pursue another diploma at our polytechnics and Institutes of Technical Education (ITEs) at subsidised fees. The Deputy Prime Minister called it "another bite" of the education subsidies. I hope this new subsidised back-to-school full-time diploma programmes can also help produce more professionals, managers, executives and technicians (PMETs); and hence, reduce the future need for more S Passes and Employment Passes (EPs).

Sir, these are substantial moves. Committing the funding is just first step and, of course, a critical enabler. The real heavy lifting is in operationalising the entire value chain, where workers seek training that the employers sought; the educators being deeply plugged into the needs of industries and businesses and curate the skills proramme that matters; and the work unions and Government closely monitoring, facilitating and anticipating the next few bounds ahead.

Sir, I welcome another shift that was mentioned in the Budget, with details to be provided later this year; and that is the temporary financial support scheme for the involuntarily unemployed. This is in keeping with the current reality, where we will see more disruptions that will impact businesses and jobs. I am glad that we are now ready to move on this. It is very much part of what we meant a functioning, social compact and that we have got each other's back. Sir, in Mandarin, please.

(In Mandarin): [Please refer to Vernacular Speech.] There is a saying that people have no fixed position and water has no constant form. The rapid development of technology today has led us into an era of constant change in the workplace. The transformation of economic operations has directly impacted the workplace, changing the employment model and shortening the value and lifespan of skills and knowledge. In response to this situation, this year's Budget has also strengthened a response strategy, enhancing and introducing new policy measures.

In addition to the enhanced SkillsFuture subsidies of up to $4,000, the Government has also adjusted education subsidies, allowing middle-aged Singaporeans to re-enter educational institutions to pursue professional diplomas and enhance their employment potential.

Workers who wish to attend qualified full-time work courses, can also receive training allowances of up to $3,000 per month. From these measures, we can understand the Government's intention to enable Singaporeans to maintain employability, expand employment opportunities and have a better future.

Learning and upskilling is a challenging endeavour, with economic cost and personal time commitment. This is why the Government is investing significant financial resources and strengthening policy measures to alleviate this burden on the individual.

Ultimately, whether we can achieve results depends on whether workers have that willingness and passion to seek skills and knowledge, and whether employers have a flexible, rewarding and long-term mindset to support this.

In this process, we also need to curate more courses that can be applied to enhance employment opportunities. This will be a very difficult road, but we have no choice. I can see the Government's determination, and in the future, it will require everyone and the entire system to work together to implement these enhanced upskilling policies.

(In English): Sir, on the economy, I fully agree with the Deputy Prime Minister that we need to continue growing the economy, so that we can improve the collective well-being of Singaporeans.

And given the inherent constraints stacked against us, such land, labour and carbon, our next phase of growth has to be productivity and innovation driven. It is not going to be easy, as bigger countries that are better resourced and with the scale of domestic economy are also doing the same.

The strategy that we have adopted to overcome our limitations and which has placed us among the top economic value-add country per capita in the world, is by continuously attracting high quality and high value investments to Singapore.

Attracting such investments help us leapfrog the riskier and the capital-intensive build-up phase; and enable our economy to always stay at the frontiers of cutting-edge technology. Hence, anchoring high value and innovative MNEs to base and hub here continues to be a compelling strategy for an economy like ours with minimal scale.

And thanks to our best-in-class investment attracting agencies like the Economic Development Board (EDB), the Monetary Authority of Singapore (MAS) and Enterprise Singapore (ESG), we have been able to attract these high-quality investments, despite the intense competition.

I often read the annual reports of EDB, to get a sense of how much investments we are attracting each year. Besides reporting the fixed asset investment (FAI) commitments and the total business expenditure per annum (TBE), EDB would also report the jobs expected to be created and the value added to the economy.

For example, in 2023, the EDB attracted FAI of $12.7 billion, TBE of $8.9 billion and these are expected to create more than 20,000 jobs with a projected value-add of $26.7 billion. I am heartened that our economic investment agencies never lose sight on the ultimate motivation on why we bring in investments, which is to create good jobs and to contribute to our gross domestic product (GDP).

Sir, we have to keep strengthening our propositions; among others, to always be a business-friendly destination of choice, having a diverse talent pool, excellent infrastructure and connectivity, trusted jurisdictions, strong financial standing and, of course, an able Government and political stability.

How could our local enterprises benefit from the presence of MNEs? The key is in finding ways for our local firms to be the suppliers and servicers of the MNEs; and playing a part in their value chain.

The enhanced Partnership for Capability Transformation aims to increase the range of modalities for MNEs and small and medium enterprises (SMEs), to collaborate and to help the SMEs up the game. This could be the pathway for our local enterprises to break out of the size trap, level up to be the emerging regionals or niche champions.

Sir, besides attracting high quality investments and developing our local enterprises, we have also got to invest in our capabilities and build longer-term competitiveness. The Deputy Prime Minister announced a series of significant investment into our capabilities in this year's Budget; for example, the $3 billion in Research, Innovation and Enterprise 2025 (RIE2025), $2 billion in the Financial Sector Development Fund, $100 million to upgrade our Nationwide Broadband Network.

To enhance our longer-term energy security, the Government will also inject an initial $5 billion to set up the Future Energy Fund. These are massive funding commitments. Sir, I look forward to the details in the upcoming COS debate.

On AI, I am glad that Singapore has a head-ups in developing AI capabilities with our National AI strategy. It has not gone unnoticed internationally.

Last December, I happened to be in Taiwan for the holidays, with my family. At that time, the Taiwanese Presidential and the Legislative election campaign were in full swing. And out of curiosity, I popped into a couple of election rallies in Taipei and watched the local news there, to hear what are the issues that the candidates were talking about.

It is not uncommon in Taiwanese elections, to hear opposition politicians there using Singapore as an example to criticise their government for not doing as well as Singapore. So, in this election there, it was again not surprising that Singapore got a few mentions. One of them was where the opposition politicians ridiculed their government on why tiny Singapore can be listed as the top 10 countries in the world, leading in AI research and technology; and Taiwan is not there. They lamented that Taiwan is losing out in this AI race and will severely impact its overall competitiveness.

Sir, I am pleased that we are now into version 2 of our National AI Strategy; and in this Budget, the Government has committed to invest $1 billion per year for the next five years. The investments will be used to work with leading companies to set up AI Centres of Excellences in Singapore as well as secure the much needed advanced chips for AI development.

Sir, we need to keep up with the momentum in our AI development; and I support the additional funding announced by the Deputy Prime Minister.

Mr Speaker, Sir, my final point is with regards to the adjustments to the corporate income tax; to incorporate the BEPS 2.0 Pillar 2 changes. Under Pillar 2 of BEPS, a global minimum effective tax of 15% is required to be applied to large MNEs. Many jurisdictions including Switzerland and Hong Kong has announced their plans to implement it in 2024 and 2025.

BEPS 2.0 will reset the level playing field for global competition for investment and that is why it is critical that we keep improving our overall offerings such as introducing the Refundable Investment Credit to strengthen our competitive position.

One issue of considerable interest is the revenue impact from introduction of Domestic Top-Up Tax.

In the near term, it is expected to provide additional revenues to the Government. In an OECD report released in January 2024, OECD provided estimates that imply a revenue gain of around 15% to 40% in corporate income tax for investment hubs. Using our revised FY2023 corporate tax revenue base of $28.4 billion, this would mean an additional $4 billion to $11 billion of revenue.

In February 2024, Hong Kong which will introduce Pillar 2 in 2025 has estimated its own revenue impact to be around HKD 10 billion, or S$1.7 billion. There was another estimate by Switzerland in August 2023 which estimate the impact for Switerland as CHF 1.6 billion, or S$2.4 billion. Both the Hong Kong and Swiss estimates seem to be point to a lower revenue impact than what the OECD estimates would imply, which is up to about S$10 billion for Hong Kong, up to about S$15 billion for Switzerland.

Of course, OECD has cautioned that there is a wide range of uncertainty in their estimates.

Sir, Pillar 2 is an unprecedented change in tax policy and there are significant limitations in the extent to which previous experience and studies can inform on the "behavioural reactions" by governments and MNEs and therefore the revenue impact.

Furthermore, the OECD report does not factor in the impact of Pillar 1, which will have a negative revenue impact for Singapore. When both Pillar 1 and Pillar 2 are taken together, it would be difficult to pin down on the net revenue impact.

The more important point is BEPS 2.0 is a key challenge for Singapore which we must navigate carefully.

And which is I why, I support the Budget 2024 measures to enhance our investment promotion toolkit through the Refundable Investment Credit; as well as the various investments in our workforce, in innovation and in infrastructure.

Sir, to conclude, a good Budget is not defined by just about how we spend, how big we spend, how many more areas we spend but also how we fund our expenditures on a sustainable basis. This discipline about a balanced Budget is of critical importance especially where the trajectory of our spending is heading higher.

Often, commentators would like to use characterisations such whether the Budget is left-leaning or right-leaning or centre-left or centre-right to describe a Budget. But it may not be that straightforward for this year’s Budget.

Rather than to characterise the budget as being more left or right-leaning, I would say this is a budget that is forward moving and upward progressing. We have every determination to move Singapore forward; and in this forward journey ahead to ensure that there will be upward social mobility and cohesion and importantly upward progress for everyone. Sir, I support the Budget.

Ms Foo Mee Har.

Mr Speaker, Budget 2024 is a budget notable for its wide-ranging support measures. These include generous assistance to meet cost-of-living pressures to taking forward-looking steps to ensure Singapore and Singaporeans continue to thrive in a fast-changing economic and social environment.

Sir, I wholeheartedly support this year’s Budget and I thank the Government for listening and being responsive to needs on the ground. There are significant progressive moves announced in this Budget, such as the SkillsFuture Credit top up of $4,000 for those 40 years and above to level up; as well as moves to better calibrate policy such as easing of property tax burden for many home owners who saw their tax bills spike.

We even see policy innovation where the Government provides Parenthood Provisional Housing Scheme Vouchers for families to rent an HDB flat in the open market for one year, to supplement the strong demand for temporary housing whilst families wait for their BTO completion.

Sir, I would like to focus my speech on three key areas where Budget 2024 helps with cost pressures, sharpens Singapore’s competitiveness as well as addresses retirement adequacy.

First, on cost pressures. Sir, riding on the better-than-expected Government revenue in Financial Year (FY) 2023, individuals and families stand to benefit from a mix of cash, vouchers and rebates under the $1.9 billion boost to the Assurance Package.

Companies, especially SMEs, also stand to benefit from the $1.3 billion Enterprise Support Package with a slew of support measures, including the generous corporate income tax rebate of 50%, capped at $40,000 in the year of assessment FY2024.

Those with less will receive more, but there is something for everyone.

Sir, I applaud the Government for their concerted attempt to shore up individual and company cash flows. However, we must be very careful to calibrate handouts to ensure that these are sustainable, as people may grow to rely on them over time. It may become a challenge to wean them off expectations of such broad-based support in the future.

Also, the generous direct transfers to cushion residents from elevated inflation may, ironically, add to further demand and reverse early signs of moderation on inflation.

Last year, I had raised similar concerns about Government handouts increasing demand and creating a vicious escalation in prices. Helping people cope with rising costs is a worthy policy but it must be balanced against the risk of prolonging inflationary pressures. After all, it would be unsustainable to dole out assistance to fight inflation if such help ends up keeping inflation higher for longer. So, I call on the Government to keep a close eye on this.

Next, sharpening Singapore’s competitiveness. Mr Speaker, Deputy Prime Minister Lawrence Wong announced an ambitious target of two to 3% GDP over the next decade. The economy grew by only 1.1% last year, down from 3.8% growth the previous year. Real income declined 2.2% for the first time in over 10 years. Singapore’s continued growth in the new era of global development is not guaranteed.

We face challenges in an international tax environment where global minimum tax regulations are upon us, and where countries around the world are fighting for high-quality investments.

Sir, Singapore has evolved from a trading port to a global finance hub, logistics, and also for manufacturing. In order to succeed in our next phase of growth, we need to pivot towards high-value, innovative economic development.

This shift necessitates a profound change in our skills and capabilities, far beyond what has brought us success in the past.

In an era dominated by rapid technological advancements, our focus must pivot towards nurturing skills in innovation, research and development (R&D), digitalisation and AI. These fields have transformative potential to boost our economy, but require a new breed of industries and professionals who are adept in these cutting-edge domains. The magnitude of this transition cannot be understated. We are not simply adopting new technologies; we are required to reshape our economic fabric.

So, Budget 2024 rightly earmarked a substantial sum of $13 billion towards capability development – these include boosting productivity, research and innovation, green transition and AI transformation.

Deputy Prime Minister Lawrence Wong announced the launch of a refreshed incentive toolbox with new fiscal schemes, such the new Refundable Investment Credit scheme and top-up of existing funds to further advance capabilities. This is 10 times the amount set aside to help companies cope with near-term challenges.

However, Sir, many of the initiatives will only be effective to the extent they are taken up. Significant effort must be directed to boost usage in order to achieve the intended outcomes of the respective schemes.

For example, even though SkillsFuture has been launched for close to 10 years, only three in 10 Singaporeans have used their SkillsFuture credits. The number of companies tapping into R&D grants is insufficient, and SMEs still struggle to decipher the multitude of schemes and the complexity and onerous application process.

Sir, even as I persist in urging the Government to intensify its efforts to stimulate adoption – a topic I will delve into during my COS speeches – it is ultimately incumbent upon companies and workers to seize these opportunities and to forge a brighter future for themselves. The support schemes available to us is a springboard, but the impetus to leap forward lies within us.

Embarking on a journey of transformation is akin to preparing to scale new and uncharted mountains. This journey compels us to traverse unfamiliar terrain and to overcome obstacles that are inherent in scaling any worthy peak.

We are comforted by the knowledge that, in this journey, we are not alone. The support schemes available are akin to tools, maps and safety gear, provided to ensure that our climb, our ascent is not only successful but also safe and secure.

These resources are designed to assist us in navigating the complexities of change, offering guidance, training and support at every step. But, ultimately, it is only we who scale the mountain; the gear alone cannot do it for us.

Next, retirement adequacy. Mr Speaker, Budget 2024 contains excellent initiatives to further boost retirement adequacy, such as the Majulah Package, enhanced support for Matched Retirement Savings Scheme, Silver Support Scheme Enhancement and others. But, unfortunately, the announcement to close the CPF SA for those aged 55 and older attracted the most attention.

Whilst I support the rationale behind the Government's move, the sudden closure of SA accounts affects many middle-income seniors. Based on established CPF rules, they have systematically saved and trusted this scheme to build up their retirement nest-eggs.

Many rely on CPF savings as a key source to fund their retirement. This sudden unexpected change disrupts their retirement planning. As a policy move, it may be fairer if the Government could grandfather the SA scheme for existing 55 and older CPF members.

Sir, the most exciting development within the CPF framework for me is the increase of the Enhanced Retirement Sum (ERS) to four times of the Basic Retirement Sum, reaching $426,000 in 2025.

Over the years, I have advocated for a higher ERS, enabling CPF LIFE to better cater to the retirement needs of middle-income Singaporeans, especially for those considering CPF as their primary source for retirement planning. This is really important that the CPF serves middle-income Singaporeans.

The rule of thumb for the income level required to maintain a similar lifestyle in retirement typically involves replacing a certain percentage of your pre-retirement income. It is commonly suggested that retirees will need approximately 70% to 80% of their pre-retirement income to sustain their lifestyle. This estimate of 70% to 80% as what they need in retirement, assumes the decrease in certain expenses, such as commuting, work-related expenses or mortgage payments, while anticipating an increase in others like healthcare or leisure activities.

If we consider the current median monthly income of about $5,200 for full-time working residents in the middle-income group, the estimated monthly payout under the new ERS would be approximately $3,300. This represents a 63% replacement income versus the 70% to 80% recommended for middle-income earners. This is a significant increase from the current monthly payout of $2,530, which only replaces about 49% of our median wage earner's income.

Sir, the introduction of the new ERS is a significant step toward closing the retirement adequacy gap for the middle-income earners, an issue I have persistently lobbied for over many years.

While CPF LIFE should not be tailored to meet the needs of the affluent, it must and it must serve as a primary source of retirement income for our low- and middle-income seniors, ensuring they have financial security and peace of mind in their golden age.

Finally, Sir, fiscal space and top up funds.

Sir, in examining the budgetary position for FY2022 and FY2023, I would like to seek clarification on several fronts.

Firstly, with regard to the Government's accountability on fiscal marksmanship. The final financial outcome for FY2022 diverged notably from the initial projections, going from an anticipated deficit of $2 billion into a surplus of $1.7 billion.

For FY2023, despite a revenue increase exceeding expectations by 7.9% and surpassing $104 billion, the fiscal deficit for this year is, in fact, revised to $3.6 billion deficit. This represents a significant widening from the earlier projection of $0.4 billion deficit.

In the light of these developments, I would like to ask how the Government projects revenue and expenditure to ensure a level of predictability that informs crucial decisions, such as the need to raise taxes to balance the budget.

Secondly, a significant amount of funds totalling $24.3 billion for FY2023 and $20.4 billion for FY2024 are allocated towards topping up endowment and trust funds.

While I appreciate the fiscal discipline demonstrated by setting aside funds that are committed for future programmes that we promise the people without burdening future budgets and generations, I want to seek clarification on several aspects.

Firstly, the rate of drawdown of the various funds. Secondly, how the Government determines whether expenditures should be funded from funds and endowments, as opposed to operating budget. Additionally, I am interested in understanding how undrawn amounts are treated and how drawdowns are optimised across funds to smoothen out expenditures. Sir, with that, I support the Budget.

Ms Hazel Poa.

Mr Speaker, Sir, perhaps the most noteworthy thing about this year's Budget Statement was the amount of support measures provided to Singaporeans without any additional major tax increases announced. This will come as a great relief to many Singaporeans who are still struggling to cope with the high costs of living and an uncertain job environment.

I will first address the support measures and how we can take bolder steps to support Singaporeans in coping with the rising cost of living. I will then discuss Progress Singapore Party's (PSP's) views on the proposals in the Budget to support lifelong learning and develop the full potential of Singaporeans.

Sir, those of us who walk the ground will know that the rising cost of living is the number one concern for Singaporeans and we have debated this issue at length in this House last November. Many Singaporeans are feeling that their wages are unable to keep up with rising prices, leading to feelings of anxiety and insecurity. This feeling is borne out in the wage statistics. After taking into account inflation, real wages rose by only 0.4% in 2022, but fell by 4.5% in the first half of 2023.

Furthermore, the Consumer Price Index, or CPI, which measures inflation, does not take into account loan repayments. This means that the higher interest rates which resulted in higher mortgage payments and other loan payments are not taken into account in the calculation of inflation and real wage growth.

The Government's response has been to provide subsidies and rebates that help households in the short term, for instance, the Assurance Package. While these short-term support measures are welcome, PSP has always maintained that these are not long-term solutions that address the root causes of the rising cost of living.

While it is true that rising prices are subject to global forces like oil prices, food prices, disruption to supply chains due to pandemics, wars or climate change, there are also domestic factors driving prices. These domestic factors include our property prices, Certificate of Entitlement (COE) prices, population policy and Government taxes.

Today, I will only talk about property prices and Government taxes and leave the discussion on COE and population policy to another day. Suffice to say that COE increases our transportation costs and population policy affects the overall demand for all goods and services, thus putting pressure on all prices.

One root cause of the rising cost of living is rising rents.

In the retail sector, rent constitutes about 30% of the business costs. This means that when you walk into a shop to buy a product, 30% of the cost of that product is due to the shop's rental and this has not yet taken into account the suppliers' rental costs which had been built into the cost of goods sold. Similarly, in the food and beverage (F&B) sector, rent forms about 27% of business cost. Rent therefore has a big impact on the cost of living of most Singaporeans.

PSP once again calls on the Government to take action to moderate excessive commercial rent increases in Singapore. For a start, guidelines on reasonable annual rent increases can be issued, similar to how the National Wage Council (NWC) issues guidelines on wage increases.

If the rate of rent increases can be moderated, it will not only be beneficial for Singaporeans but it will benefit businesses as well.

In addition, Government is the largest landowner in Singapore and yields significant influence over the property market. If it has the political will, it can push outcome in the direction it wants.

Another root cause of rising cost of living is home prices. For most of us, buying a house is the single largest expenditure of our lifetime. PSP has proposed the Affordable Home Scheme in which HDB flat prices do not include the land cost component for home buyers upon first purchase, but deferred if and when they sell their flats. This will greatly ease the burden of housing costs on young people and allow them to more easily build up their retirement savings. It might even provide some with the leeway to take risks with their careers and pursue any entrepreneurial dreams without being shackled by large mortgage payments.

Government taxes form part of the cost of living, with the most obvious being the Goods and Services Tax (GST).

In Budget 2022, Deputy Prime Minister Lawrence Wong said that healthcare expenditure is increasing due to the ageing population and is expected to hit $27 billion in 2030. GST therefore needed to be raised to fund the expected increase in healthcare expenditure. If healthcare expenditure hits $27 billion as expected and the increase is fully funded by GST, then GST would have to be raised by another 3.5% approximately by 2030, to reach about 12.5%.

Will the Government share whether there are any further plans to raise taxes to fund the increase in healthcare expenditure?

Currently, the Government helps Singaporeans cope with GST increases and cost of living increases by giving cash grants, rebates and vouchers, resulting in a situation whereby the bulk of the population are now in regular receipt of Government handouts.

In any society, there will always be people with different income levels and it is normal for Government to give grants to the lower-income families. But if the bulk of the population need Government handouts to cope with cost of living, then that cannot be a healthy situation. We should also be circumspect about the fact that the bulk of the population is getting used to the idea that it is a norm to receive Government handouts.

It may be the easier route to provide handouts to cope with the cost of living, but we must focus on taking steps to keep costs in check.

For a start, we ask the Government to reconsider exempting a list of basic necessities from GST. We can list specific products rather than broad categories to minimise classification issues and limit price levels to those generally consumed by lower- and middle-income families. The need for this measure will become more pressing as GST rate increases.

The way that the Government currently treats land sales proceeds and prices HDB flats is also adding to taxpayers' burden. HDB must pay Singapore Land Authority (SLA) for the land used to build HDB flats. These land sales proceeds are then locked away in past reserves and are paid for by large Government grants. These Government grants must be paid by taxpayers. So, in effect, taxes are being collected to be locked away in the reserves.

Further grants are given to HDB flat buyers in order to make flats more affordable. These grants must also be paid by taxpayers.

I have previously proposed that land sales proceeds be treated as revenue divided over the duration of the lease. It is heartening to hear the Prime Minister acknowledge that this is not an unthinkable proposition during the Public Finances debate earlier this month. As this measure can relieve the tax burden on Singaporeans, I hope the Government will consider it seriously.

Apart from containing costs, another way to cope with rising cost of living is through raising wages and ensuring that they keep pace with the rising cost. One major way of doing so is through education and training.

Before I talk about education, I wish to declare that I own a private education company.

PSP supports the introduction of the SkillsFuture Level-Up Programme for Singaporeans aged 40 and above, which consists of a $4,000 credit, subsidies for another full-time diploma and training allowance for full-time trainees. We believe that full-time training will be more effective in enhancing the employability of our workers. These policies will also enable our middle-aged workers to switch careers more easily and move into areas with better or more job opportunities.

We are, however, disappointed that details of the temporary financial support scheme for the involuntarily unemployed are still not ready.

Retrenchments are becoming increasingly common. Temporary financial support would be greatly beneficial to retrenched workers seeking a new job. Any delay in the implementation of this scheme has real consequences on the retrenched employees. We hope the Government can finalise the scheme as soon as possible.

In addition, if a retrenched worker decides to enter full-time training a few months after they were retrenched, we hope that the size of their training allowance will not be impacted by their period of unemployment. We seek the Government's confirmation that their training allowance would be based on their last drawn pay when they were employed.

In his Budget speech, Deputy Prime Minister Wong announced his intention to ensure that the wages and career prospects of our ITE graduates should not be too far below their polytechnic- and university-going peers. He then announced a new ITE Progression Award, which provides a $5,000 top-up to the Post-Secondary Education Accounts of ITE graduates who enrol in a diploma programme; and a $10,000 CPF top-up for ITE graduates when they attain polytechnic diplomas.

We whole-heartedly support the intention of helping our ITE graduates, but feel that the ITE Progression Award does not quite fully meet that objective.

Today, about 4,000 ITE graduates – or about 28% of the annual ITE graduating cohort – qualify for polytechnics each year and about 4,000 ITE graduates enrol in the polytechnics each year. Since most of those who qualified already chose to progress into diploma courses, the Award has limited scope to encourage more to do so.

The $5,000 top-up to the education accounts does help to ease the financial burden of ITE graduates enrolling for diploma courses; but the $10,000 CPF top-up less so and, furthermore, is actually going to a group who are no longer just ITE graduates, but a specific group of diploma holders.

An issue of parity amongst diploma holders arises here. Giving $10,000 to some diploma holders, but not others, based solely on the route they took to enter polytechnics can get controversial.

We are of the view that a better way to help ITE graduates would be: one, help more ITE graduates qualify for polytechnics. Entry requirements can be reviewed to recognise the value of relevant work experience rather than just grade point average (GPA). Those who decide to take the "O" levels in order to qualify for polytechnics should also be supported. This can be done through promoting or expanding the ITE General Education course; or providing education grants to those doing so as private candidates.

Two, help those who enrolled in diploma courses successfully complete their programme by conducting bridging courses to cover the gaps between ITE programmes and "O" level programmes. A TODAY article in July last year, cited students who expressed the need for such courses in areas, like mathematics and essay writing.

The above support measures should also be extended to those who had dropped out of school even before completing ITE, but now wishes to return to the education system to upskill or upgrade themselves.

PSP hopes that the Government will consider our suggestions so that together, we can find a more permanent solution to the challenges faced by Singaporeans in coping with the rising cost of living.

Sir, the Progress Singapore Party supports Budget 2024.

Ms Joan Pereira.

Mr Speaker, Sir, I appreciate the measures in the Budget to assist our households so that they can tackle immediate challenges and face the future with more assurance.

With global tensions and conflicts exacerbating shortages of supplies and disrupting logistic chains, prices of goods and services have risen substantially and are expected to increase further. Unfortunately, it is challenging for our workers' wages to keep up with the pace of price increases and inflation.

In the face of an uncertain global operating environment, competing priorities and the need to balance our budget, I welcome the Ministry's decision to provide greater assistance for the lower-income group and bigger households with elderly and children.

Lower- and middle-income households would be heartened that the $6 billion top-up to the GST Voucher Fund will secure the permanent defrayment of GST expenses for them. Many will receive further support from the Cost-of-Living Special Payment, the U-Save rebates and Service and Conservancy Charges (S&CC) rebates; the additional $600 in Community Development Council (CDC) Vouchers coming on the heels of the $500 recently disbursed, are appreciated.

On this note, I would like the Government to consider pegging this or future batches of vouchers to the number of persons per household. If three or four generations or an extended family live at one address, it could be due to financial limitations. Hence, all the more reason for a headcount-based CDC Voucher system. On the other hand, if the reason to stay together is to facilitate mutual care and support, the household should similarly not be penalised for this.

Today, I would like to take the opportunity to appeal for more middle- and long-term support for the sandwich generation – whom I would refer to as the group that has to provide for the care and expenses of children and elderly parents, while having to prepare for their own retirement needs. We have to factor in longer lifespans, which mean that they have to support their parents over a longer period even as they themselves become senior citizens. As family is the most important unit of society, we need to continue providing the relevant support needed by this group in order to safeguard our families and our society.

The raised per capita household income thresholds for healthcare and associated social support subsidy schemes, will be greatly welcomed by our families as more will be able to benefit from subsidies. I also appreciate the increase in the Silver Support Scheme, which provides quarterly payments to seniors who had low incomes during their working years and have less family support. I hope a similar scheme can be introduced for elderly with similarly low incomes during their working years but who are living with their family members, albeit in the lower- and middle-income brackets. Such a support programme will also help to alleviate the burden on the sandwich generation.

I would also like to speak about our families with genuine needs to ferry young children and elderly parents at this stage in their lives – who need cars but find car ownership difficult to afford. Would the Government also consider recalibrating our vehicle COE system to take into account the changing car usage patterns, including the rise in car-sharing services and yet continue to keep car ownership affordable for families who need it?

Finally, I would like to surface feedback regarding retirees living in landed properties. In recent years, their property taxes have been increasing, which affects this group of senior citizens living off their savings. While the annual value bands will be raised and they will be allowed to pay via a 24-month instalment plan without interest, some of them may still face financial issues. Hence, I would like to propose for an arrangement where IRAS will review, discuss with and advise affected landowners the various payment options and alternative solutions appropriate to their specific cases. Sir, in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] I would like to surface feedback regarding retirees living in landed properties. In recent years, their property taxes have been increasing, which affects this group of senior citizens living off their savings. While the annual value bands will be raised and they will be allowed to pay via a 24-month instalment plan without interest, some of them may still face financial issues. Hence, I would like to propose for an arrangement where IRAS may review, discuss with and advise affected landowners the various payment options and alternative solutions appropriate to their specific cases.

(In English): This is a forward-looking Budget that is focused on steering the whole nation ahead while not leaving anyone behind. Sir, I would like to conclude with my support for the Budget.

Mr Raj Joshua Thomas.

Sir, I thank the Deputy Prime Minister for his Budget that, in my view, puts money in the right places, including investing in Singaporeans in the long term.

My speech today is in two parts. First, I will speak about the culture of work in Singapore. Second, I will speak about uplifting the wages of workers in the professions of the hands.

Let me begin by saying that I am heartened by the investments the Government is making in our workers – through the enhancements to the SkillsFuture Credit scheme and the SkillsFuture Mid-Career Allowance as well as the subsidy for mature workers to take another full-time diploma. This will help to ensure that our workers are able to keep themselves relevant and future-ready.

But these schemes will not bear fruit if our workers do not have the correct mindset and our culture of work is not conducive.

The culture of work in many countries, including in Singapore, is changing. I welcome some of these trends, like flexible working hours and working from home, as they can help to create work environments that are conducive to an ageing population and supportive of couples having more children. I am more cautious of other trends and suggestions – like a very short workweek and a right to disconnect from work.

Many of these trends originate and emanate from developed economies. Singapore is, of course, also a developed economy, but we are very different from many of these other countries – some of which have natural resources or hinterlands that they can tap on. Singapore's sole resource is our human resource, upon which all our success has been built. As the late Mr Lee Kuan Yew said, and I quote, "You know the Singaporean. He is a hardworking, industrious, rugged individual; or we would not have made the grade." The quote, of course, continues to say that he is also a champion grumbler. But that it is fine if he has worked hard, then he has earned the right to grumble.

Therefore it falls to reason that if our workforce weakens, our competitiveness and attractiveness as an economy weakens and this threatens our continued ability to sustain our way of life. As such, we should be very careful when we look adopting some of these trends and we should determine their sustainability for Singapore and the consequences of implementing them in legislation and in policy.

Take for example, the right to disconnect legislation recently enacted in Australia. Amendments made to the Fair Work Act will allow workers to refuse to monitor, read or respond to contact or attempted contact from their employer or a third-party outside of their working hours, without penalty. Let us look at the practical effect of this legislation.

First, there will always be some workers who decide to forego their rights and to remain connected. These are people who simply do not want to disconnect for various reasons. And among these people, we may be likely to find the future leaders of organisations, future entrepreneurs, inventors, young lawyers who aspire to become senior counsel, workers who want to go the extra mile to delight their customers, administrative service officers who want to get their promotions. There is simply no alternative to hard work, putting in the hours, putting in the steps. And being in a global city in a super-connected world, a contactable and responsive worker is invariably a more valuable worker.

Second, while the worker that refuses to be contacted would not be penalised, the worker that remains contactable may get a boost in his performance evaluation. He may be more likely to get the increment and the promotion because an organisation must reward those that are more valuable to it and that are more willing to do more than they have to.

Third, there may be tensions that arise because the worker who exercises his rights strictly may have expected that he would have had spots as the worker who forewent his rights, who would in turn expects that he does better precisely because he had put in more work than is expected.

The legislation in Australia gives the worker an actionable right to disconnect. So, this means more litigation, more labour discord on something that may ultimately not be easy to prove. Such legislation creates more questions, more tension that could be disproportionate to any good that could conceivably come out of it. I hope that such legislation does not come before this House.

We should be careful as to what trends and fads we decide to champion in this House. They may have severe consequences on the productivity and competitiveness of our workforce. Let us not forget how the Great Resignation came and went as fair as doomed.

There is a trend promoting an aversion towards material success, as if it was some form of scarlet letter, in favour of a more relaxed attitude to work. Being overly materialistic is, of course, not a good thing. But I hope that this does not trickle down to become an aversion to hard work, ambition or the pursuit of success because we have to face it that many successful people are motivated by material success, and that that pursuit of it may lead to the creation of successful companies and jobs and opportunities for Singapore.

So, let us encourage those who want to work hard and who want to work more, in pursuit of whatever their dreams are and let us avoid a culture against work from forming in Singapore.

On a related note, at the last Sitting, we had a lengthy and very important debate on mental health. I am glad that Deputy Prime Minister Wong has stated that mental health is a national priority and that there will be an expansion of mental health services. I am, however, troubled with some narratives that suggest that mental health and hard work are on polar opposites and that they are mutually exclusive. I have heard people say things like: "I'm not going to put too much effort into this job because I am prioritising my mental health". Yes, excessive work stress can lead to mental health issues. But I am sure that there are also many people who work very hard, who take on a lot on themselves professionally, who have difficult working hours – and who also have good mental health. I imagine that there are many Members in this House who would fall into this category.

We should therefore avoid giving paid to such narratives even as we tackle very real mental health concerns amongst our workers.

I am concerned that the Singapore worker may be becoming complacent in believing that our way of life is a given. Singapore is not invincible. In fact, as Deputy Prime Minister pointed out in his Budget speech, we cannot afford to become complacent. We are vulnerable – if we have slow growth similar to what we saw in the previous year, Deputy Prime Minister said, we would be in trouble, and we would not be able to improve our collective well-being, and our standard of living would be affected. So, we must constantly work at it and we must guard against trends and ideas that can negatively affect our competitiveness.

But at the same time, there is no point working hard to maintain the lead and then not enjoying it ourselves. So, we need to achieve that balance. We cannot just live well in vacuo. We should not just work hard. And it is not about working well either. It is about working hard and living well. This is the work culture we should seek to promote amongst Singaporeans.

So, perhaps we can aim for our workers to have it all – and to put that forward as the ideal for our Singapore workers. My vision of a Singapore worker is someone who works hard and tries to do his best at his job. He is proud of his professional achievements and confident that he has the skills to take on future roles and to compete with foreign talent. He is compensated adequately to have a good Singapore standard of living, including spending quality time with his family and pursuing his personal interests. He is physically and mentally healthy. This is a vision of a holistic Singapore worker – one who does his best to work hard and is able to live well.

In fact, I would like to encourage our workers to use this as a mantra and a hashtag online: #workhardlivewell. You do not have to fell "pai seh" posting about your leisurely pursuits or holidays with your family, or just having gotten or bought something nice for yourself. Why? Because you worked hard, you achieved it, and you deserve it. #workhardlivewell.

Sir, all this having been said, and moving on to my next point, there are yet workers amongst us who work hard but who do not live as well as they should, primarily because they do not earn enough, and also for some, because of longer working hours and working conditions. They are in what may be called the professions of the hands, that is, jobs that are manual in nature and that do not have a high academic criterion for entry. Many of these are in Progressive Wage Model (PWM) sectors like cleaning, retail, F&B, security and waste management. I declare at this juncture, Sir, my interest as the President of Security Association Singapore, a trade association in a PWM sector.

In the first instance, Sir, I think that we need to recognise that these jobs require that workers have certain skills. We must recognise and accept that these are skilled jobs. Last week, there was some online chatter about a SkillsFuture course on washing toilets, which is part of the mandatory training for workers in the cleaning industry. A post that was widely circulated commented that these skills could be learnt during National Service or at home. I think this misses the point. Just because one can grow a cactus on their office table does not make them an arborist or horticulturalist.

This course teaches workers on how to clean toilets on a commercial basis. And there are many things that go into it, from safety elements like putting up a sign outside the toilet while it is being washed and when to remove it, to the use of various types of cleaning equipment, and chemicals, some of which may be dangerous if not used properly. It goes into basic custodial checking and time management because these workers have to manage the cleanliness of several washrooms in a day. So, let us not ridicule the work that people do or the training that they undergo.

The second thing that we should recognise is that these are jobs that are physically demanding. I would challenge naysayers to wait tables at a restaurant. It is not easy. I have done it myself. You are on your feet throughout your shift, walking from tables to kitchen or to the bar, carrying food and drink that can be heavy. There is a public relations element to the job because you should be pleasant with patrons and there may be some amount of entertaining that you may have to do as well. It is not as simple as some may make it out to be.

Third, there are significant shortages in the manpower supply for these jobs. In the security industry there is an estimated shortage of between eight and 18,000 officers at any one time. The shortages become worse when there is a surge of demand for security officers during major events, like the Formula One (F1) Race. We therefore need to be able to attract more Singaporeans to enter these professions and to pay them well.

Fourth, these jobs are important jobs that have integral contribution to what Singapore is and what Singapore aspires to be. If we look at the trademark physical attributes that Singapore is famous for – clean, green and safe. All of these are managed by PWM sectors. We are a food paradise. We want to be a shopping destination. All PWM sectors. The workers in these sectors may not hold very high academic qualifications but they are doing their part in the Singapore miracle and it is not a small part, and they need to be recognised and rewarded accordingly.

I was very encouraged when I read Deputy Prime Minister Wong's speech at the IPS Singapore Perspectives Conference in January last year. Amongst other things, the Deputy Prime Minister said that we should embrace a broader definition of a good job and recognise skills and competencies instead of overly focusing on paper qualifications. The Deputy Prime Minister said that we should embrace a broader definition of a good job and recognise skills and competencies, instead of overly focusing on paper qualifications. The Deputy Prime Minister said it is not just about re-shaping the labour market, but also about shifting perceptions about work.

I was further encouraged to see the Forward Singapore report include "respecting and rewarding every job" as one the objectives we would seek to achieve. It is important that we not only reward workers in these jobs, but that we also build respect for their professions, so that we can equalise how all jobs are viewed. The report also called for a further reduction of wage gaps across professions including through the PWMs.

In this Budget, there are also measures to bolster the PWMs through the Progressive Wage Credit Scheme as well as to support Institute of Education (ITE) graduates through the Progression Award. It is quite clearly a Government priority, which I applaud, to achieve a mindset change so that all jobs in Singapore are viewed as good jobs, and that the gap in the compensation for workers of different professions is made smaller.

The current PWMs look at closing the gap between lower-wage workers and the median income. I would like to call on the Government and the tripartite partners to go further so that we can achieve both the twin aims of reward and respectability. I ask that they consider setting as a long-term objective that the average wage of workers in each PWM sector rise to be on par with the average wage of fresh university graduates.

I make this suggestion because although the Forward Singapore report addresses the matter of increasing rewards, it does not touch much on how to improve respectability, aside from encouraging it through some form of moral-suasion. Pegging average wages of professions of the hands with that of academically-inclined fresh graduates could provide a more tangible indication that both these categories of jobs are equally worthy of respect and hopefully, trigger a cultural shift in how our society views these jobs.

I would also like to ask the Government and the tripartite partners to also accelerate the PWM wage increases so that our lower-wage workers can also live well and enjoy the fullness of the standard of living that Singapore should provide for its citizens. While the PWMs have achieved very significant wage increases that would have not occurred but for the PWMs, my view is that they need to go further.

We can look at, for example, the prescribed entry-level security officer wage in 2024, which is $2,650. For, say, a 40-year old officer, after deductions for CPF, he would take home about $2,120 – a sum that would go into supporting his family and himself. I am not going to go into the various calculations, that have been aired in this House before, of what is a minimum living wage in Singapore. But let us just be honest with ourselves and ask ourselves if $2,120 a month is this sufficient. Will such a wage entitle that security officer to live the life of a Singapore worker that I envisioned earlier? Will he enjoy the good Singapore standard of living? If we are honest with ourselves, I think we know that it would not be sufficient.

But the silver lining is that security officers will in fact see fairly rapid wage increases over the next four years. By 2028, an entry-level security officer will earn a minimum basic wage of $3,530 or more; security supervisors will earn $4,130 and senior security supervisors at least $4,430. I hope that the tripartite partners negotiating the security PWM beyond 2028 will consider my suggestion to peg the average wage of security officers across all the ranks with the average wage of fresh university graduates.

While my proposal may be seen as bold in the Singapore context, it is in fact a norm in many advanced economies. My research reveals that the average wages of cleaners, security officers and waste management personnel are not far from the average wage of a fresh university graduate in Sweden, Switzerland, Japan and Australia. In fact, the average wages of waste management personnel and security officers, in particular, tended to be higher than that of fresh university graduates.

So, it does appear that Singapore is somewhat of an anomaly amongst comparable advanced economies in the wages we pay our workers in these sectors.

Finally, Sir, I would also like to ask the Government to make further effort to persuade consumers to support wage increases by being prepared to pay more for the services that the PWM sectors provide. As Deputy Prime Minister Wong said at the IPS Conference, consumers must be willing to pay more for certain goods and services to uplift the wages of those who provide them.

I am on all fours with Deputy Prime Minister's observation that, and I quote, "We cannot demand for services delivered by our fellow citizens to be priced cheaply and in the same breath lament that their wages are too low. It is completely inconsistent."

But another observation is that the initial few PWM sectors were all in the facilities management sector and were servicing mainly private condominiums and commercial buildings. The buyers of these services actually can afford the increases in prices, but unfortunately, many of these buyers still retain the mentality that these services are manual services and therefore ought to be cheap. They have therefore been reluctant to increase prices in recognition of value and have largely continued to adopt a cheap-sourcing approach.

In this regard, I hope the Government will do more, in partnership with the respective trade associations and trade unions, to change buyers' mindsets.

Hence, Sir, to summarise. I hope that our workers will continue to have a mindset that is cognizant of our innate vulnerability. We have to put in effort in order to maintain our way of life. The corollary is that those who are working hard, including in professions of the hands, are able to get their just rewards. I hope that we will collectively be able to enjoy the Singapore standard of living, regardless of our professions and educational background. The reality of maintaining Singapore’s competitiveness and our prosperity is that, if we want to continue to live well, we must be prepared to work hard. And those who work hard should expect that they will get the rewards and respect that enable them to live well. Sir, I support the Budget .

Mr Louis Chua.

Mr Speaker, as I have shared in my Inland Revenue Authority of Singapore (Amendment) Bill speech on Budget Day itself, FY2023 did turn out to be another year of record tax collections, after significant increases in IRAS’ tax collections over the last two years, a jump of around 38% to $68 billion in FY2022.

Overall operating revenues increased by $13.3 billion in FY2023 compared to a year ago to $104.3 billion, and this is also $7.6 billion higher than projected operating revenues first revealed in Budget 2023 last year. What is noteworthy is that this is not solely on the back of volatile revenues such as stamp duties or vehicle quota premiums, but on the back of record levels of corporate income tax, personal income tax and of course, GST revenues, all of which continued to break new record highs. What was most impressive was the 23% jump in corporate income taxes in FY2023, even after a sharp jump of 27% the year before, with corporate income taxes set to be sustained at record high levels of around $28 billion. This was not surprising, given news of record profits from some of the larger Singapore corporates, from DBS Bank to Sembcorp Industries.

Positive revisions to FY2022 data also meant that instead of a revised deficit of $4.2 billion, FY2022 saw a surplus of $1.7 billion instead. While the overall fiscal position for FY2023 is still projected to be in deficit, this was largely due to an increase in special transfers, chief of which is the recent inclusion of the $7.5 billion Majulah Package Fund, without which FY2023 would have seen a $3.9 billion surplus instead.

It is important to put into context the record operating revenues and improved fiscal position of the Government against the challenging economic environment that we faced in 2023. GDP growth slowed to a mere 1.1%, while inflation was a source of consternation for many Singaporeans, which was what led the WP to raise the cost-of-living Motion in Parliament late last year, to share ideas and possibilities of reducing cost of living pressures by way of policy change, many of which are structural.

In line with the theme of providing constructive feedback and ideas, I have two revenue measures for the Government to look into, after studying the revenue and expenditure trends over the past years. This would be in addition to revenue raising moves that my colleagues and I have shared in past Budget debates, such as the issue of wealth taxes which I have raised previously, where even though we may have raised the highest personal income tax bracket and property taxes, the likes of wealthy individuals earning dividends and capital gains income from their vast wealth while renting luxury apartments in Singapore will still not be taxed directly.

Firstly, looking at revenue collections as a percentage of GDP from FY2018 to FY2024 in Table 3.2b, over the years, customs and excise taxes is one of few categories which has seen a decrease in contribution as percentage of GDP over the years, despite higher tobacco excise duties from last year and the inclusion of carbon taxes in this category. In line with the spirit of wealth taxes, there is room to study the potential to have liquors being taxed on an ad valorem basis, in light of our suggestion of raising so-called “sin taxes”. This need not result in any increase in duties on everyday alcoholic beverages, but it would be much more equitable if the so-called “atas” wines of the world, which easily cost thousands of dollars a bottle, incur a higher excise duty compared to the $20 a bottle wine found in the supermarket.

Second, I note that casino taxes were raised in 2022. In spite of this, betting taxes as a percentage of GDP have been flat in past years at around 0.5%. Given that gambling duties have been unchanged since 2014, there is room to look into raising the relevant gambling duties, which could also serve a deterrent function.

Moving on to the main body of my speech today, I will touch on the importance of structural changes compared to one-off handouts, where I will highlight the need for structural improvements to personal income taxes and corporate income taxes to better support individuals and businesses while keeping our tax system progressive and up to date, and also touch on the urgent and important topic of retirement adequacy.

Conceptually, I believe that: one, it is important to put in place structural levers in our system as opposed to relying on one-off schemes, which may either be new or have to be refreshed year after year, incurring a lot of administrative costs and resources to operate on the part of the Civil Service, and creating much uncertainty on the part of Singaporeans; two, it is also important to direct our resources to those who need them the most, rather than broad-based handouts to everyone, which could lead to allegations of Budget measures being part of an "Election Budget."

Take the CDC Voucher scheme, for example. While I am sure all Singaporeans appreciate cash handouts amid the cost-of-living crisis, the CDC Voucher scheme evolved from one aimed at helping Singaporean lower-income households defray their cost of living in 2020 to one where all Singaporean households are eligible. The amounts given have also varied quite significantly over the years, and it remains a question whether the scheme will be a permanent one, or if so, whether all households will continue to qualify and just how much are the vouchers going to be worth.

Moreover, as opposed to the existing GST Voucher scheme, there appears to be many operational challenges faced by Singaporeans when trying to claim the CDC Vouchers, such as those who are renting their flats and sharing the same address with other households, those living in shelters and also those who no doubt may belong to the same household but are facing difficult familial relationships.

On personal income taxes, I note a tax rebate worth 50% of tax payable, or up to $200 was introduced in YA2024, similar to YA2019. However, instead of a one-off rebate, we are better off raising the bottom-end of marginal resident personal income tax rates and increasing the tax-free threshold for the first $20,000 of chargeable income to reflect inflation over time. This was what I raised in a Parliamentary Question back in 2022.

Similarly, on corporate income tax (CIT), a CIT rebate of 50% of the corporate tax payable will be granted to all taxpaying companies, whether tax resident or not, for YA 2024. In my speech on the Income Tax (Amendment) Bill in 2021, I suggested raising the level of progressivity in our corporate income tax regime to better support our local SMEs.

Even as other support for companies to build capabilities is being strengthened, I hope the Government would consider providing greater tax relief to our SMEs, such as by raising the tax exemption limits or by introducing schemes similar to the two-tiered profits tax rate regime in Hong Kong, which they introduced in 2018 to relieve the tax burden for SMEs in particular.

This is important given that in Budget 2018, the Government announced tighter restrictions around our tax exemption schemes. For an SME making $300,000 in chargeable income for example, total corporate income tax paid before any rebates would be close to $34,000 or an effective tax rate of 11.2%, compared to around $25,000 or an effective tax rate of 8.4% based on prior rules.

Having such corporate income tax reforms built into the tax regime would also provide for greater certainty, as opposed to the current CIT rebates which significantly vary year after year from 20% to 50% in terms of the rebate, to a cap of $10,000 to $40,000 in the last decade from YA2013 to YA2024.

It is critical to ensure that we continually re-invest in our local SMEs, the backbone of our economy representing 99% of all enterprises here and responsible for the jobs of 71% of employees, to enable Singapore to stay competitive in a post-BEPS world. Otherwise, we could well see a reduction in our tax base and employment levels, should our local SMEs shift more of their activities to other jurisdictions in response to the new business environment.

Touching on the topic of BEPS2.0, which I have also spoken about in past Budget debates, the time for introducing adjustments to our tax system is finally before us. Deputy Prime Minister Wong has also announced the introduction of two components of Pillar 2, the Income Inclusion Rule and the Domestic Top-up Tax.

As I have asked last year, while precise numbers may not be feasible, does MOF not have a range of blue sky and grey sky projections as to the impact of the implementation of a domestic top-up tax? Especially when we are looking at the Income Inclusion Rule and the Domestic Top-up Tax taking effect in less than a year’s time, for businesses’ financial years starting on or after 1 January 2025?

To put into context my question, the OECD has published a working paper earlier this year, which finds that the global minimum tax “can raise between US$155 to US$192 billion of additional CIT revenues per year, with revenue gains accruing to all jurisdiction groups”. Moreover, estimated participating countries categorised as “investment hubs,” which includes Singapore, would have the largest expected gains from the reforms, with corporate income tax revenues rising from 14% minimum to up to 34%. If this is factually incorrect, given that the MOF will have a better basis to make its own estimates, then I hope the Deputy Prime Minister can correct this in his round-up speech.

Instead, the Deputy Prime Minister shared in his Budget speech that he does not expect the new moves to generate “net revenue gains,” due to the “significant spending required to stay competitive.” To say so is just akin to saying any forms of tax rate increases, from personal income tax, stamp duties to the GST, is not going to generate net revenue gains due to higher spending needs.

I understand that this could be due to the introduction of Refundable Investment Credits and the net effect of BEPS 2.0 and the Refundable Investment Credit is to an extent also dependent on just how generous the EDB and ESG are in awarding these Refundable Investment Credits to companies.

I agree that only time can tell when it comes to the actual revenue gains, as we await the roll-out of Pillar 2 globally, but it would be a sad day if countries go against the spirit of the reforms in the first place.

The BEPS 2.0 reforms were introduced to stop the race to the bottom when it comes to sovereign tax policies, and to facilitate international collaboration to end tax avoidance. Let me repeat that the OECD has shared that with the two-pillar solution, all economies will benefit from extra tax revenues – all economies. I hope the additional tax revenues from BEPS 2.0 will not simply be in substance returned to MNEs through other forms.

Finally, let me touch on a topic which is close to my heart – and that is retirement adequacy. It is also a pressing issue which requires urgent and decisive action, given our rapidly ageing society. While there are several good moves to improve retirement adequacy, like raising the ERS and enhancing the Silver Support Scheme and MRSS, I am concerned about the closing of the CPF SA after the age of 55, and the lack of longer-term measures to help Singaporeans grow our retirement nest egg sustainably.

In itself, I do not have qualms about the closing of the SA. However, this is a step backwards when it comes to ensuring the retirement adequacy of Singaporeans, and much needs to be done to truly strengthen retirement adequacy for the seniors today and tomorrow.

When the compulsory annuity scheme CPF LIFE was introduced, the SA continued to provide flexibility to CPF holders to access or “touch” their retirement savings, while providing a decent interest rate floor of 4%.

Deputy Prime Minister Wong said in his Budget speech, “The remaining SA savings will be transferred to the Ordinary Account (OA). Of course, members can voluntarily transfer their OA savings to the Retirement Account (RA) at any time, up to the revised ERS, to earn higher interest and to receive higher retirement payouts.” Is this the full picture, though?

Singaporeans will know that funds in the RA will be used to pay the premiums for their CPF LIFE plan, meaning to say we can no longer withdraw the funds as we wish. It is also true that from the age of 55 to, say, the payout age of 65, these RA funds continue to earn the same interest rate floor of 4% as with the SA. So far, so good. But unbeknownst to many, from the moment payouts commence, any interest earned will not accrue to the CPF holder, but it is pooled together under CPF LIFE for all members.

An FAQ by the CPF Board says it best, that interest earned on CPF LIFE premium is not included as part of the amount paid to beneficiaries when one passes away. I understand that this is the concept behind annuity schemes to enable members to get lifetime payouts. But it also means that even though the stated interest rate of the SA and the RA is identical, the actual yield that is earned by the two accounts could not be more different. And that based on the latest average life expectancy of Singaporeans, it is unlikely that the effective yield for RA savings will exceed that of funds that would have been in the CPF SA.

Moreover, whenever I raise the issue of CPF interest rates in Parliament, the response by various political officeholders has been to stress the attractiveness of prevailing risk-free interest rate floors of 2.5% for the OA and 4% for the Special, Medisave and Retirement Accounts (SMRA) over the past two decades of protracted low interest rate environment. The closure of the SA from age 55 takes the shine out of such counter-arguments, in my view.

As Deputy Prime Minister Wong reminded us, we are facing a change in environment from very low interest rates to a more normalised period where interest rates will be higher for longer and the era of easy money is over. It is in the context of this sea change that we should look at CPF interest rates going forward. How then should we allow the laws of mathematics and compounding to work for our seniors’ retirement funds?

I continue to stick by what I spoke about in the Reserves Motion earlier this month, and that is to enable all Singaporeans, not just our reserves, to directly participate in the long-term returns from the Government's fund manager, GIC, with adequate safeguards in place. This is especially pertinent when we consider the source of funds for the GIC in the first place, a part of which is indirectly derived from CPF savings via the Singapore Savings Bonds (SSGS bonds).

As I have shared, based on the 20-year nominal returns of the GIC portfolio of 6.9% and the CPF-OA rate of 2.5%, based on a simple rule of 72, the number of years it takes for our CPF monies to double goes from about 10 years based on GIC’s returns, to 29 years based on the prevailing OA rate. The effects on our ability to save for our own retirement is tremendous.

I listened to Minister Indranee Rajah's explanation that in 2014, then Deputy Prime Minister Tharman explained in Parliament at great length how we set our CPF interest rates and manage CPF proceeds. I went to do a bit of research on this into the Hansard and realised I was far from being the first to bring this up. Then Deputy Prime Minister Tharman's explanation was in response to PAP Member of Parliament Mr Inderjit Singh, who also questioned whether our 2.5% interest rate paid out to the CPF OA is fair compensation for Singaporeans who have left their savings locked up for so long.

In fact, if I go back further in time, many MPs from the PAP, WP, NMPs, have all suggested allowing regular Singaporeans access to better investment returns from the Government's investment entities like the GIC. PAP MP, Dr Lily Neo, called on the CPF Board to work with GIC, and perhaps peg the interest rates at two percentage points below GIC's returns. NMP Mr Siew Kum Hong quoted an academic paper which stated that: "To the extent that the GIC's return on investments has been higher than the return actually credited to CPF members, a recurrent, highly regressive, largely implicit tax on the CPF wealth has been borne by CPF members." PAP MPs Mr Ong Kian Min and Mr Sim Boon Ann called on the Government to share with CPF members surpluses it makes on CPF monies. And Mr Ong even said, "I cannot understand how the Government can say it will not be responsible for providing for my retirement, but I must lend the Government my retirement savings for investments and any gains earned on my money is not my money." Finally, Ms Sylvia Lim from the WP also called on the Government to do more to boost CPF returns while managing the risks, especially after the 2002 Economic Review Committee's recommendations to do so via private pension plans.

These are all words of wisdom by those who came before me, and two decades on, continue to resonate so deeply with me. How many more Singaporeans today could have met their retirement sums, compared to the four in 10, five in 10 today, had we implemented these suggestions back then?

If for some reason the Government is still adamant that we are unwilling or unable to allow Singaporeans to share in the fund management expertise and returns of the GIC, then the least we can do is to urgently implement the Lifetime Retirement Investment Scheme (LIRS), something which I have been repeating in each of the last three years so that we can better support Singaporeans' retirement needs.

Let us remember that eight years ago, in 2016, then Minister for Manpower Mr Lim Swee Say, had then on behalf of the Government, accepted the recommendations within part two of the CPF Advisory Panel's report, which included the introduction of the LIRS as an additional investment scheme. To quote then Minister Lim: "These additional options will help address the concerns some Singaporeans may have with regard to the rising cost of living in retirement and the desire for higher expected investment returns for those who had to take on some investment risk."

One of our fellow MPs today, Mr Saktiandi Supaat, was a part of the CPF Advisory Panel too, where Chairman Prof Tan Chor Chuan articulated the limitations of the CPF Investment Scheme (CPFIS) and put it so aptly, that "the Panel believes that there is a need to provide an additional investment avenue that can better help such CPF members earn higher expected returns than the CPF interest rates in a simpler way than CPFIS."

The big question I have is, when will the Government finally be ready to roll this out? Is it still prepared to do so? I hope the Government is cognisant that the longer the delay, the higher the opportunity cost and real cost to Singaporeans' retirement savings.

To conclude, Mr Speaker, I appreciate the Government providing for one off goodies and handouts to Singaporeans and Singapore companies, on the back of yet another record high operating revenues, which were $13 billion higher compared to a year ago. However, it is important that we put in place structural levers in our system as opposed to relying on one-off schemes and I have suggested changes to our personal and corporate income tax systems to illustrate this point. And finally, we are all aligned with the urgent need to strengthen Singaporeans' retirement adequacy, so let us not shut Singaporeans out of attractive, sustainable and practical solutions to boost our retirement funds.

Mr Darryl David.

Mr Speaker, Sir, Budget 2024 is a budget that is set against major global uncertainties. Singapore continues to remain vulnerable to macro forces that are beyond our control and influence. While we continue to keep an eye on global developments with trepidation, I am glad that this year’s Budget has reflected the Government’s commitment to the Forward Singapore movement by introducing specific and targeted support to areas of concerns highlighted by Singaporeans.

Sir, I will be focusing my speech on three main areas: (a) how the Government could refine the Additional Buyer's Stamp Duty (ABSD) scheme for Singaporeans below 55; (b) SkillsFuture and Continuing Education and Training (CET); and (c) how the Ministry of Education (MOE) could enhance the personal learning device (PLD) scheme to cover more students, specifically those in primary school.

First, supporting “young seniors” and enhancing ABSD. I am particularly glad that the Government is providing additional support to seniors on ageing, healthcare and retirement during such times of uncertainty and rising cost. This is an assurance to seniors, including young seniors like myself, that the Government will provide older Singaporeans a social safety net during their silver years, particularly when senior Singaporeans are facing the twin challenges of ailing health and reduced incomes.

Many Singaporeans aspire to own a private property because in some ways, it is an investment with high potential returns that could be unlocked during their silver years. I am glad that the Government now allows senior single Singaporeans above the age of 55 years old to claim for a refund of the ABSD on a second private property when they are downsizing. I had asked a Parliamentary Question on this topic in July 2023 and I am grateful to the Government for responding with this policy change.

This would give senior single Singaporeans more flexibility to unlock the value of their initial larger properties, or more valuable properties during the later years of their lives, without having to bear the financial burden of ABSD, which under the previous policy would have reduced their retirement nest egg by a significant amount.

I believe that this this is an important policy change, assuming that single Singaporeans are unlikely to have the same level of economic support that married senior Singaporeans with children would have. Allowing a refund on their ABSD would help them to better meet their retirement needs.

In the same vein, I would like to ask if the Government would consider extending the same ABSD refund scheme to younger single Singaporeans who are buying a smaller second private property to stay in, if they sell their first property within six months of acquiring their second private property. I believe this policy will give younger single Singaporeans more flexibility in their housing options if they wish to unlock the value of their private properties, especially to meet unexpected financial needs.

The refund policy for younger single Singaporean could be scoped more tightly than that for senior single Singaporeans to prevent abuse and profiteering. For example, the younger single Singaporeans must hold their first property for a specific number of years before they are entitled to the ABSD refund on their second smaller property and, perhaps, such refunds can only be claimed once or a maximum of twice in their lifetime.

My next topic will focus on SkillsFuture and continuous education training (CET). Apart from supporting senior Singaporeans with their ageing, healthcare and retirement needs, I am heartened to learn that the Government is also putting increased emphasis on our middle-aged Singaporeans with the SkillsFuture Level-up Programme. In particular, I welcome the $4,000 SkillsFuture Credit (Mid-Career) top-up and the Mid-Career Enhanced Subsidy for another publicly funded full-time diploma programme.

Sir, with the shelf life of skills declining rapidly, it is paramount that the skills that Singaporeans have can keep up with rapidly evolving industry needs. Having once spent many years working in Temasek Polytechnic, I am confident that our polytechnics and IHLs are equipped to design and develop CET courses that can help upskill our mid-career Singaporeans.

That said, with industry needs evolving at such a rapid pace, our educators at the polytechnics and IHLs might not be fully equipped with the latest industry knowhows and insights to design and conduct courses that meet industry demand entirely. At present, there are very few courses offered at polytechnics and IHLs that are co-developed, co-taught and co-certified with industry partners.

I would like to urge MOE to consider how we can incentivise our polytechnics and IHLs to work more closely with the industries to conduct co-certified Pre-employment Training (PET) and CET courses. Co-taught and co-certified CETs are especially important for mid-career Singaporeans in equipping them with the latest knowledge that can positively impact their career. After all, having attended a co-certified programme with a leading industry player sends a strong signal to employers that their employees have learned from the best in the industry, not just from the staff at the polytechnics.

On the same note, I strongly urge our polytechnics to co-create new diploma courses with industry partners to take advantage of the Mid-Career Enhanced Subsidy. Rather than have mid-career Singaporeans join an existing diploma programme with PET students, specific industry-oriented programmes with different teaching methods, pedagogies and learning outcomes should be created for them.

It is important for us to recognise that adult learners have very different learning needs and learning styles from teenagers or younger adults. Putting adult learners on the same diploma programmes is unlikely to help them to acquire the skills needed for a career switch or career step-up, since both groups of learners have very different levels of industry experience and cognition. Similar to how the teaching methods and teaching styles must differ between in a Masters programme and an undergraduate programme, for example, the diploma programme for mid-career Singaporeans must be designed and taught differently as well.

I would also urge the Government to extend the Mid-Career Enhanced Subsidy to part-time diploma courses as well, not just full-time ones. I believe this would encourage more mid-career Singaporeans to take up such courses since they can still be employed full-time while undergoing upskilling and retraining.

Sir, my final area will focus on Personal Learning Devices (PLDs) for primary school students. Almost four years ago, in June 2020, I made a speech that urged MOE to consider extending the provision of PLDs to all students in Singapore, particularly those in primary school. While MOE committed to providing PLDs to all secondary students by end-2021 to be used in tandem with the national e-learning platform Student-Learning-Space (SLS), would MOE now not also consider providing PLDs to children in primary schools as well?

I think it is timely for MOE to consider providing PLDs to our students in the primary schools given how the education technology landscape has changed significantly in the past four years.

With the procurement framework of PLDs for secondary schools in place, it is now a matter of extending the same procurement framework and financial support schemes to students in our primary schools as well.

To reiterate some of the arguments that I have previously made: the ownership of PLDs for all levels of learners in Singapore is a bold and ambitious step in realising Singapore’s ambition to embrace smart learning. Such a device will enable students from across all levels of education to learn everywhere and anywhere and is the textbook of the future where all forms of education and submissions can be made on a single unified platform.

Introducing the ownership of PLDs at an early age would help induct our students, our younger students, to the notion of self-directed e-learning, encouraging them to take ownership of their own learning pace and performance at a younger age. This undoubtedly, will have a knock-on effect when they are older, especially when e-learning and continuous learning on-the-go become second nature to them.

Mr Speaker, this year’s Budget has continued the trajectory of the previous Budgets, with the Government providing targeted support to assist specific groups of Singaporeans, especially to navigate this uncertain space, this uncertain world that we are facing. While a significant portion of the Budget is focused on providing near term support to cope with the cost of living in the form of CDC Vouchers, Service and Conservancy Charges (S&CC), U-Save and income tax rebates, the Budget is also forward looking in providing support for seniors and mid-career Singaporeans.

With Singapore due to become a super-aged society by 2030, ageing in dignity is one of the foremost concerns for many Singaporeans. I am heartened to know that the Government is taking active steps to address this concern early through the Forward Singapore movement and the following policies that it is rolling out.

I hope the Government can accelerate the pace in which support programmes for seniors are being rolled out and to consider how to better cater to the needs of this group of Singaporeans who have contributed tremendously in early years to Singapore. Beyond providing top-ups to Medisave and direct financial support through the Silver Support Scheme, I also hope that the Government can also work towards building robust localised ecosystems that allow our seniors to age with dignity. With that, Sir, I end my speech in firm support of the Budget.

Mr Henry Kwek.

Mr Speaker, Sir, I rise in support of the Budget. Today, I would like to speak about two things: how to help our people thrive in their jobs; and how to support our seniors to age with purpose and dignity. I will also speak briefly about the cost of living.

We spoke about unemployment support in this House for years. Based on my conversations with my residents in Kebun Baru, it is not yet a top-of-mind concern for them. To give some context, four in 10 of my residents live in private estate homes. Why? Because the residents trust that the Government will support them if things get tough, as during COVID-19. I also want to point out that major insurance companies do sell unemployment insurance, but the take-up is not high.

But conceptually, I believe Singaporeans, including myself, are open it to if it is properly designed, as the world and the job market are changing at breathtaking speed. Two weeks ago, OpenAI stunned the world with their text-to-video capability, Sora. Sora was able to generate life-like one-minute videos from text prompting, where everything in the video obeyed the law of physics! Imagine that! Being able to ensure that every interaction in the animation abides by physics. This has some veteran Hollywood producers suggesting that in three to five years, generative AI can do the bulk of small screen television series production.

Great possibilities. But what happens to creative professionals globally, including in Singapore? The same story can be replicated across many industries, many countries.

We need to be prepared. We want our people to lead in this new wave of change. Most people do agree with the central idea, but yet, there are also many questions. Who will pay for it? Do we buy an insurance. Can we opt out? If the Government pays for it, how much tax do we all have to pay? Will they get abused? What will happen to personal responsibility?

To address this concern, we should be clear on what we want and what we do not want. Of course, we want our people to be confident in the face of change. We must focus on the central issue, which is an unanticipated cash flow challenge that most people face when they lose their jobs. We want this kind of support to be different from those who fall below the poverty thresholds.

Right now, we support Singaporeans only when they have exhausted their wealth and their familial support. But moving forward, when Singaporeans lose their jobs, we want them to focus on reskilling and upskilling by providing them with some financial peace of mind. Unemployment support should not only come when their savings have been wiped out.

Now, what we do not want? We do not want abuses or the shirking of personal responsibility. We do not want our people to make uninformed career reskilling decisions.

Factoring in the views of my residents, I propose a multi-tier approach towards unemployment support that balances three critical pillars of social support: one, a strong sense of personal responsibility; two, efficient risk-pooling through insurance; three, sufficient Government support, which is largely, let us not forget, largely funded by our taxes.

Let me first speak on efficient risk-pooling through insurance. I hope we can see a basic and not gold-plated unemployment payout for several months with an upper limit on one's lifetime, funded by unemployment insurance and, hopefully, we can pay for this insurance through the CPF.

Some of my residents also want the freedom to opt out. Of course, we have to think through this carefully. It will be easier to persuade people to join in in this insurance if the premium is affordable.

Two, we must preserve a strong sense of personal responsibility. As the cost of living differs widely, we should give our people a choice in how to manage their lifestyle in the event of a major cash flow disruption. To do so, we can offer them these options: fully or partially freezing housing loans and majority of healthcare, insurance premiums, taxes and fees, for a limited time to help with their cash flow, providing Government transfers, such as GST rebates ahead of schedule, that means, they can take their subsidies and transfers ahead of other Singaporeans and allowing them to borrow against their own CPF monies for those Singaporeans with healthy CPF balances already. The Government can also work with financial advisory associations to provide affected people with free financial advisory.

The third point is to provide sufficient Government support which is largely funded by tax. I hope the Government can offset some of the cost of the insurance and get things started. If there are specific industries or large companies that are going through a major downsizing, I hope the Government can step up to top up the monthly assistance, perhaps through a larger or longer payout, because when there is a large number of people exiting one industry, not everybody can quickly move into another industry.

In short, in implementing unemployment support, Singapore, we, must find our own way forward. We must do so by ensuring personal responsibility, risk pooling among our people, and Government support complement and not undermine one another.

To ensure support, I also hope we can actively consult the silent majority before rolling this out and move carefully, start with a modest programme and review that over time, because if we are to fund this programme through a further tax increase, there might be some fatigue amongst our taxpayers.

Let me switch now to Skillsfuture. There is broad support amongst people for the enhancement of Skillsfuture. Singaporeans are deeply appreciative of the monthly support for adult Singaporeans to go back to school full-time. This is something that Members of this House, including myself, have advocated over the years. It fills a critical gap in our efforts to upskill and reskill our people. Of course, our Government must also do our level best to ensure that the skills training in most industries is relevant and useful.

Now, let me move to my second topic, caring for our seniors. On behalf of PAP Seniors Group, I would like to thank the Government for delivering an A-plus Budget for seniors and for taking onboard many of the suggestions from PAP SG MPs.

I am also heartened that the Government is moving decisively on issues that I have spoken about over the years: seniors' CPF contribution rates, making our estates more senior-friendly and encouraging home-care services. Now, we must quickly implement these services as we are facing a silver tsunami. In addition, I hope the Government can consider the following.

First, quickly scaling up Age Well SG's caregiving home-care sandbox. The idea is straightforward. I hope the Government can support not just foreign manpower quota but also set aside spaces in HDB estates, so that the professional caregivers can be sited there comfortably, respond to our seniors quickly, without incurring too much transportation cost.

Second, even as we level up our Active Ageing Centres (AACs), I hope the Government can consider funding senior-related services in trusted nodes where our seniors gather, such as places of worship: mosques, churches and temples.

Third, to ensure that our nation's ecosystem of senior-related services always has a focus on serving our private estate residents as well. Our private estate seniors have caregiving and emotional support needs, even though they are better off financially. But through them, we can also get a preview of the needs of future Singaporean seniors.

Before I end my speech, I would like to speak briefly about cost of living.

First of all, I hope to see the Government provide more cost-of-living offsets in the next Budget, not just in this, especially to help our seniors and families, including those who are asset-rich and cash-poor, especially retirees living in the private estates.

I also hope that the Government can actively identify supply-side solutions and fixes, which can bring down the cost of doing business and, therefore, the cost of living. Let me give Members a few examples.

One, to reduce the manpower shortage, can we allow our companies to hire more foreigners, at a reasonable levy, in exchange for them creating even more flexible work arrangement opportunities, which will benefit our seniors, stay-at-home mums and caregivers? Can we increase the number of purpose-built dormitories and, in the meantime, allow for more onsite dormitories to ensure that our foreign manpower housing cost is manageable?

Also, once we implement the special economic zone with Johor, can we improve the connectivity of our more manpower-intensive operations and industries with our immigration facilities, so we can tap on more manpower from Johor to come over to work and go back to Johor daily?

Can we further re-energise our pro-enterprise panel to identify areas of red tape that cost the private sector time and money, so that we can reduce the cost of transacting with the Government?

Lastly, I hope the Government and my fellow Members in the Chambers can think through the cost-of-living implications when we pass new laws, regulations or ask for more enforcements. For many of us in business, we instinctively know that a higher quality or service level usually means higher cost. It is true for many governments, too.

Enforcement fairness costs money, too. Let me give an example using the upcoming rental fairness framework.

Yes, the law is more precise but it is also more complicated. Moving forward, most landlords will need lawyers to do contracting rather than let agents and landlords handle the drafting of lease as it is now. Moving forward, every time there is a change in the areas being surveyed, the landlords will need to hire a surveyor. These will cost landlords at least a few thousand dollars. What does it mean? Yes, it is harder for errant landlords to disadvantage the tenants, but all consumers will have to pay for the higher cost-of-living associated with higher rents.

Finally, I hope we can have a real conversation within our Chamber on how the issues we debate on and the solutions we propose have contributed to the higher cost of living, higher taxation or lower Government efficiency. I hope we can all be more measured when we call for more rules, additional studies and Parliamentary Questions, if it is only because we want to be seen conveying moral outrage after a tragedy or to signal virtue to a more particularly vocal part of our electorate.

I am fully aware that we speak up in Parliament to voice the views of our people. But let us remember that there is a real cost to society, through higher cost of living that the silent majority must bear when we pile on excessive regulations and enforcement.

In fact, I hope that when we speak about laws in Parliament in the future, we can speak clearly of the regulatory and enforcement cost imposed on society, businesses and our people. With that, I stand in strong support of the Budget.

Mr Leong Mun Wai.

Mr Speaker, Sir, Budget 2024 is a big Budget because the Government had a bumper year in 2023. Operating revenue in 2023 was larger than the original estimate by $8 billion because of the tax increases announced in 2022, high inflation and high property prices. This $8 billion excess revenue, together with the $23.5 billion Net Investment Returns Contribution (NIRC) for 2024, contributed to surplus Budget resources of more than $30 billion to be allocated in this Budget.

As a result, the Government was able to make a record capital transfer of more than $30 billion to top up existing endowment and trust funds and create some new ones. Because of this, Budget 2024 will give some benefits to almost every Singaporean.

However, the monies in the endowment and trust funds will fund social spending over many years into the future and only a small amount will be spent this year. PSP has explained the workings of the endowment and trust funds during the Public Finance Motion three weeks ago and why capital transfers to these funds should not be considered as current-year spending.

Hence, Budget 2024 falls short on immediate spending in the current year. While we welcome the $1.9 billion Assurance Package and the effective reduction of the owner-occupier residential property tax increase announced in 2022 by the revision of the annual value bands of the properties, these supports are hardly enough for cash-strapped Singaporeans to cope with the current cost of living crisis.

The Government has also decided to close the SA for CPF members above 55 years old. This will impact the retirement plans of many Singaporeans who can no longer enjoy a higher CPF interest rate and withdrawal flexibility of their CPF funds at the same time. Can the Government tell us how much interest it is paying these SAs currently and how much will it save in interest payments?

On the other hand, we are pleased to note that Budget 2024 has addressed some of the issues that have been regularly raised by PSP in this House.

Firstly, the Government will now provide a Parenthood Provisional Housing Scheme (PPHS) (Open Market) Voucher for one year, to support eligible families in renting HDB flats on the open market while waiting for their BTO flats. This will be a great help to young Singaporeans looking to form their own families and PSP strongly supports it.

Since Budget 2021, we have pointed out that the long waiting times to get a BTO flat is among one of the major factors pulling down our total fertility rate. As it is not possible to ramp up the BTO supply fast enough, PSP has always urged the Government to increase the number of rental flats and improve the quality of rental flats to enable young Singaporean couples to get a place to stay while waiting for their BTO flats.

While we support the PPHS (Open Market) Voucher, we are concerned that this scheme may negatively impact other groups of Singaporean tenants who are not eligible for PPHS. We urge the Government to go further to establish rental flats as a viable housing option going forward. During the COS debates, I will explain why the PSP’s Millennial Apartments Scheme is a superior and more all-rounded policy compared to providing vouchers under PPHS.

Secondly, the Local Qualifying Salary (LQS) for full-time workers will be raised from $1,400 to $1,600 from this year. We recognise this increase in LQS as a step closer to the Minimum Living Wage concept that PSP has proposed.

PSP has long advocated for a Minimum Living Wage of $2,200 per month for all Singaporean workers, which translates into a take-home pay of $1,800 per month. While we support the increase in the LQS, we are mindful of its negative impact on SMEs which need Singaporean headcount in order to employ foreign workers. We hope the Government will introduce complementary measures to minimise the impact of the LQS increase on the business viability of our SMEs, which are operating in a rising high-cost environment.

Thirdly, a new SkillsFuture Level-Up Programme will be introduced to support mid-career workers with a $4,000 credit. My colleague, Ms Hazel Poa has already affirmed our support for it. It is good that the Government has now tied SkillsFuture training programmes to better employability outcomes. PSP has long argued that the SkillsFuture programme, which costs about a billion dollars of taxpayers’ money a year, has contributed little to the employability of Singaporean workers.

Much more still needs to be done to ensure Singaporeans have a larger share of good well-paying jobs. To that end, we would also suggest a level-up for the Skills Development Fund so as to co-opt employers into the process, thereby ensuring that the training undertaken by workers are relevant to raising productivity in their current jobs.

Mr Speaker, Sir, Budget 2024 has continued with the traditional "handout approach" by the Government. The handout approach is characterised by the existence of around 60 support schemes and services, each offering short-term handouts for a targeted segment of Singaporeans. It is not uncommon, however, that multiple schemes are applied to solve one particular socio-economic problem for one recipient, which often, and very understandably so, makes it very confusing to the recipient.

For example, during Budget 2022, the Minister for Manpower presented an example of a low-income 65-year-old landscape worker who enjoyed a total income of $27,570 a year. While this figure works out to be about the same as the Minimum Living Wage that PSP has proposed, the total income was not paid from one source, but consisted of a base income of $17,400, presumably paid by the employer, and $10,170 paid by the government through seven different schemes, namely the Special Employment Credit, the Annual Progressive Wage Model Bonus, the Workfare Income Supplement, the Workfare Special Payment, Community Health Assist Scheme (CHAS) subsidies, the Care and Support Package and the U-Save and GST Vouchers. Hence, seven schemes were applied to achieve the one socio-economic objective of ensuring that the worker had more to cope with the cost of living.

Furthermore, such a system may contribute to lower self-esteem among lower-income workers because their basic pay is still very low and there are little incentives in the schemes to motivate them to improve themselves.

The handout approach also comes with a high administrative cost because needy Singaporeans usually need external help to navigate through the maze of eligibility rules to qualify for a particular support. For example, to deliver welfare benefits to a Singaporean, very often the Social Service Office (SSO), the People’s Association, the Silver Generation Office and many other private charity groups are involved at the same time.

Slightly more than half of the 60 schemes also require applications. Many needy Singaporeans are already struggling. They may not have the time or energy to pay attention to what schemes they qualify for, even if these schemes can help them. They also lack the English language proficiency to understand these rules.

Hence, despite the good intentions of the Government, the complexity of the handout approach means that many needy Singaporeans may not enjoy the benefits of the many schemes. Some of them may also not get the help they need fast enough, and this can be especially troubling when urgent help is required.

PSP is a strong advocate for more support for Singaporeans, but the taxpayer’s money spent must motivate Singaporeans to strive for higher goals and not breed dependency in handouts.

The PAP under the late Mr Lee Kuan Yew always sought to avoid breeding dependency. In contrast, the PAP Government of today is relying on a patchwork scheme of vouchers, rebates and top-ups that lower-income Singaporeans are increasingly dependent on, instead of pursuing systemic economic reforms such as reducing rent-seeking in the property market, strengthening labour protections, or introducing a Minimum Living Wage. Is this system dragging Singaporeans into a social trap rather than providing a social trampoline that allows Singaporeans to bounce back?

This may be the reason why although the PAP Government has increased social spending very significantly since about 2011, it did not seem to have improved the financial well-being of Singaporeans proportionately.

The main weakness of the handout system developed by the PAP Government, is that it does not empower the individual.

The objective of empowerment is to give the individual the means to take initiative to better his or her own life. PSP believes this begins with providing the individual with a minimum level of support and then incentivising him or her with attainable goals.

Once the individual has reached these goals, he or she will be motivated to strive for more. This whole process requires a "permanent scheme" approach and not a handout approach.

PSP’s permanent scheme approach will streamline and consolidate the Government’s 60 over schemes into a few permanent, national schemes which are easy to understand, provides a minimum level of support and an incentive mechanism for Singaporeans to work towards bettering themselves.

I have been advocating this permanent scheme approach since my first Budget debate in 2021, but my proposals were completely ignored by this Government. I shall repeat three of those that I have recommended repeatedly.

First and foremost, I have recommended the deferment of land cost from HDB flat pricing under the Affordable Homes Scheme (AHS). In our opinion, the AHS will be the beginning to many potentially positive socio-economic outcomes. For a start, it will immediately reduce the cost-of-living pressures on Singaporeans and allow them to have enough CPF savings without downgrading their HDB flats when they reach retirement. Most importantly, this peace of mind for housing and retirement will also apply to all future generations of Singaporeans.

With the AHS, we will not need to enhance the retirement adequacy of Singaporeans through schemes like the Matched Retirement Saving Scheme and the occasional top-up of CPF accounts. The resources in all these schemes can be consolidated into one permanent scheme namely the AHS.

Secondly, we have recommended the Minimum Living Wage which provides a minimum level of support to every working Singaporean permanently. As PSP have said in our manifesto 2020, anyone who puts in an honest day’s work should have enough to live with dignity.

The Minimum Living Wage is a social standard that we should establish that is not completely linked to the productivity of the worker. Thus, we have proposed the Minimum Living Wage to be co-funded by the Government. The co-funding can come from many handout schemes as mentioned before.

After ensuring a minimum gross monthly wage of about $2,200, we would like to recommend the Government to put in a permanent Progressive Wage Scheme to incentivise all Singaporean workers to continuously upskill towards higher gross monthly wages.

Thirdly, we have urged the Government to set up a National Health Insurance Scheme funded by it rather than having Singaporeans pay for their MediShield and CareShield premiums. To minimise moral hazards, Singaporeans will have to co-pay healthcare expenses from their Medisave accounts. The Government can supplement the Medisave accounts with a Healthier SG bonus every year. For Singaporeans who practise healthy living, this bonus will become excess MediSave balances which can be transferred to their Retirement Account to boost their retirement income.

PSP envisages that with the majority of Singaporeans covered under a few permanent schemes, the Minister for Finance will not need to distribute handouts to millions of Singaporeans during every annual Budget.

Our social welfare and security structure can also be streamlined and consolidated to focus on a much smaller group of needy Singaporeans. This is especially important as it ensures that this smaller group, who still need further help beyond that provided under the permanent schemes, receive the assistance they need expeditiously.

Mr Leong, you have a minute left.

Mr Speaker, Sir, I have presented the "handout" approach of the PAP Government versus PSP's "permanent scheme" approach. The latter empowers Singaporeans with the certainty of help when they need it and encourages them to strive for higher goals with incentives.

PSP estimated that the shift to the permanent scheme approach will not consume significantly more fiscal resources – because the Government already has more than 60 schemes in place and has locked away tens of billions of dollars in endowment and trust funds.

PSP believes that we can do a lot more to improve the well-being of our citizens, work to combat future challenges, such as climate change and, provide support to worthy humanitarian causes abroad.

As owners of one of the largest sovereign wealth in the world, Singaporeans deserve better policies that can lead to better lives and a more secure future. We must be aware that we have the ability and responsibility to do more for ourselves, for Singapore and also for the world.

Sir, we support the Budget in hope that it is a step in the right direction. For country, for people.

Just for your information, I gave you an extra 30 seconds.

Thank you, Sir.

Kindly keep to the time that is allocated to everyone. Mr Saktiandi Supaat.

Mr Speaker, Sir, Budget 2024 is a fair and progressive, Forward SG budget and continues the same overarching theme in the Budgets of recent years – to further improve socioeconomic equality but without stunting economic growth.

This ambition is easy to state but it is tricky to strike the right balance. There are mutual trade-offs in pursuing equality and growth together. It is also important to ensure that no one slips through the cracks.

While I have heard and read some opposing viewpoints, the general feedback from my residents is that the Budget payouts are generous and they can see that the Government is trying to transfer more from the well-to-do in our society to give to the lower- and middle-income segments in Singapore. But the message is clear. To paraphrase Deputy Prime Minister Lawrence Wong from two Budgets ago, "those who have less, get more".

However, I am also aware of our budget constraints and, most importantly, we need to be aware of our sustainability issues going forward – especially in terms of our revenues and how we intend to spend going forward.

I will speak on three selected areas on our move to enhance equality in our economy and social space, which reinforces each other. First, enhancing transport welfare and supporting the middle and upper-middle group. Second, protection of vulnerable segments. Third, on our two-pronged approach to sustain our economic growth – attracting investments and talent to Singapore; and boosting our local enterprises.

Mr Speaker, in Malay please.

(In Malay): [Please refer to Vernacular Speech.] This year, the Government continues its efforts to make Singapore a more equitable society. Just like the previous years, those who are successful will contribute a little more for the less well-off and less able. Deputy Prime Minister Wong's announcement for young ITE graduates to pursue diploma qualifications through the ITE Progression Award and the SkillsFuture Level-Up Programme for Singaporeans aged 40 and above, is something that is welcomed. Support for preschool expenses and a one-year Parenthood Provisional Housing Scheme Voucher for eligible families who rent a HDB flat in the open market are also significant and welcomed.

However, one important aspect of daily expenses that has not received the targeted attention is transportation and health costs. I will focus on the cost of transportation in my speech. The cost of owning and maintaining private vehicles in Singapore is recognised as one of the highest in the world. Even for public transport, fares have risen by 10 cents to 11 cents per trip in September 2023 and similar increases can be expected in the coming years. However, our transportation cost is still quite low compared to other major cities, with the Government providing support to reduce the impact of fare increases on commuters and ensuring that our infrastructure and transport network remain up to date.

May I ask whether the Public Transport Voucher (PTV) that was announced in December 2023 would be able to help their recipients offset 100% of the fare increase in 2023? More importantly, may I suggest that the Government consider extending targeted support for public transport, beyond those whose per capita household income (PCHI) is $1,600 or less? Can we further extend PTV as part of our budget transfers, such as CDC vouchers, in the future to help more Singaporeans?

Public transport assistance is more likely to benefit the lower and middle income groups, compared to the higher-income groups who generally use less of our buses and trains. However, if such assistance will encourage higher-income individuals to use public transport rather than private transport, that will still help us in our sustainable transport objectives. I have a resident at Toa Payoh who needs help in terms of public transport vouchers to go for job interviews and also to work in a location that is far away. There are some middle-income earners who were retrenched and are now looking for work but need temporary assistance in terms of transportation cost. So, I hope that the Government will introduce transport cost assistance in the form of a temporary financial support scheme for those who are retrenched and are now looking for jobs, for example.

(In English): We must also support the upper-middle income group, not just the low income. They are also experiencing the same rising costs but may not be getting as much in benefits compared to the lower- and middle-income groups.

One of the things in Budget 2024 that is also made available to the upper-middle income group, is the SkillsFuture enhancements. That must be correct, if we want continuous skills upgrading to be a key pillar in our social compact.

However, how likely will the upper-middle income group utilise the specific enhancements, in which are targeted at pursuing a diploma, degree or certification after age 40? Do we have data on the utilisation of SkillsFuture credits by income deciles? What do those trends tell us and will we be refining our approach to ensure that upskilling becomes a whole-of-society movement?

We must also ensure that schemes like SkillsFuture is not abused. Among other reasons, we do not want to allow those who are not in need to exploit and profit off these programmes, diverting away the help that should have gone to those who need it. It is scary to think that a criminal syndicate fraudulently made away with almost $40 million in grants between April and October 2017. While the more involved participants have each been sentenced to 13 to 17 years' imprisonment, are we still doing anything today to recover the $21 million that is still lost?

I also welcome the revision of the Annual Value (AV) bands of the owner-occupied residential property tax rates. When this property tax was raised in early 2022, it was not foreseeable that market rents would soar to the extent it did. The Urban Redevelopment Authority (URA) Rental Index for private residential properties, saw a 35.3% surge from Q1 2022 to Q4 2023. As a result, more of our upper-middle income homeowners saw the AV of their properties and their property tax bill increase.

For owner-occupied residential properties, these homeowners would not have directly benefited from the bullish market rents since they are not renting their properties out. They were thus left poorer as a result as they had to pay property tax up to a higher bracket. Would there be more frequent and periodic reviews of our property tax structure, considering the volatility of market rents in Singapore? More fundamentally, is it time to stop pegging property tax for owner-occupied residential properties to AVs which are, in turn, pegged to market rent levels?

Second, our quest for socioeconomic equality must obviously include the protection of vulnerable segments. I will just focus on two such groups of vulnerable individuals.

First, our seniors, present and future. I thank Deputy Prime Minister Lawrence Wong for the continued emphasis on the retirement adequacy of Singaporeans – especially after I dedicated almost the whole of my Budget speech last year to the topic as well as my 2022 Budget speech too. Among other things, the Government-supported increase in our seniors' CPF contribution rates, the raising of the ERS and the enhancement of support schemes, like Silver Support and Matched Retirement Savings Scheme (MRSS), which will boost the nest eggs of our seniors to retire and age with dignity.

In relation to the removal of the Special Account for those above age 55, I understand that such a move will get rid of a "shielding" hack – where wealthier CPF members are able to keep an amount that is more than their ERS in their Special and Retirement Accounts and earn the higher 4% interest on the whole of that amount. May I ask, prior to this year, how many percent of CPF members had balances in their Special plus Retirement Accounts that were more than their ERS?

But now that the Special Account will be closed, any excess funds above the ERS will be deposited back into the OA that only earns an interest rate of 2.5%. We note that. Would the Government be willing to reconsider relooking at the OA interest rate mechanism?

One suggestion would be to include some of the qualifying full banks, in addition to the three major local banks that are now being referenced. That may potentially shift the needle and is more reflective of funding conditions in Singapore. Another suggestion is to take into consideration the promotional interest rates that are offered by the banks instead of just the board rates. While it is true that a consumer might have to meet certain conditions to qualify for the promotional interest rates, that may not be a good reason to deny CPF members higher return on their OAs – especially given the cumulative size and certainty of the funds that the CPF Board is given to invest.

The Government can, of course, subsequently apply some negative credit spread or a slight discount to the interest rate – to reflect the lower risk of putting money in the CPF, as compared to bank risk. But my general point is that given the significant change or potential rapid changes in the global interest rate conditions recently and going forward, the longstanding calculation mechanism may be quite stale and no longer fit for current conditions.

For those who are unemployed – not by choice – I am supportive in principle of the temporary financial support scheme that Deputy Prime Minister Lawrence Wong had announced for the involuntarily unemployed. However, we will need more details to scrutinise if the scheme can be implemented without eroding our work ethic and design ways to mitigate the moral hazard of financing unproductivity. When does the Government expect these details to be announced and when do we expect the scheme to be implemented? Can Deputy Prime Minister and MOF share a bit more on how this scheme will be funded over time?

I await more information on this eagerly, as it is truly a big shift in principle by our PAP Government to help our Singaporean workers. I am heartened that this Government will not shy away from slaughtering "sacred cows", if it considers it to be in the interest of Singapore and Singaporeans. There is no shame in walking back if the circumstances so require.

While on the note of income volatility from unexpected unemployment, I would like to resuscitate my proposal again and again to give Singaporeans the option of assessing personal income tax on a current-year, pay-as-you-earn basis. As opposed to a preceding-year basis, this system can help taxpayers better manage their cash flow by matching tax payments with contemporaneous income.

Mr Speaker, in my next segment of attracting investments and talent. Our push for greater equality cannot come at the expense of our growth. To help Singaporeans cope with rising costs in a sustainable manner, we must focus on growing their opportunities and wages instead of relying on one-off distributions.

So, part two of my speech – therefore – turns to our two-pronged approach to sustain our economic growth: attracting investments and talent to Singapore; and boosting our local enterprises.

As a resource-scarce nation, our economic miracle has been built on attracting businesses to build up a base or some part of its operations here, even if it may service foreign markets or conduct substantial operations abroad. These inbound businesses and investments create employment opportunities and also downstream or partnership opportunities for Singaporeans and Singapore companies.

So, I am glad to hear the moves to enhance our competitive advantage in the semiconductor and finance industries, but why is there no mention of our entrepot trade and transshipment hub and specific initiatives to defend or stretch our lead? Possibly, it could be discussed in the COS.

But I note that Changi Airport's cargo flows dipped 6% compared with 2022, while other airports, like Incheon, are closing the gap to Changi, in terms of passenger flows. On the other hand, our seaport reached an all-time high in arriving ship traffic, recording over three billion annual gross tons in vessel arrivals in 2023. I will be filing related cuts during the COS debates and I look forward to hearing the Transport Minister's plans to preserve and enhance our status as an international aviation and shipping hub.

The implementation of Pillar 2 of BEPS 2.0 will also cause some loss of attractiveness as an effective corporate income tax floor is put in place across different jurisdictions. So, which of the financial incentives offered by the EDB and other agencies to draw foreign companies can we continue to offer under the global base erosion rules?

The new Refundable Investment Credit, based on the presently available information and announced by the Deputy Prime Minister, will be consistent with the Global Anti-Base Erosion Rules for Qualified Refundable Tax Credits. Companies will be able to receive up to 50% of support of each qualifying expenditure category, including capital expenditure, manpower and training costs, freight and logistics costs. This would help with the relatively higher land, manpower and transport costs in Singapore.

As the specific support rates for a project will be commensurate with the economic or decarbonisation outcomes that the project is expected to bring, what will happen if it eventually transpires that the project outcomes were never close to what was expected? Will there be a lookback period where support can be clawed back from those who can pitch and market a project much better than they can implement them?

More fundamentally, have we landed on a system of measuring and verifying decarbonisation outcomes? More than two years after we debated the "Low Carbon Society" Motion in this House, I do not think that any carbon measurement standard has achieved ubiquitous or common usage in this part of the world yet. Is there any preliminary indication of support from other countries for the playbook that is currently being developed by the National Climate Change Secretariat (NCCS), Gold Standard and Verra?

To attract businesses and investments, we must also maintain our attractiveness as a liveable city for foreign talent. It would be too parochial to assume that we know everything and have nothing to learn from others. That is why other countries have been taking some big steps to woo foreign talent to their shores.

Take the United Kingdom (UK), for example. In May 2022, it launched a High Potential Individual (HPI) visa which allows a young person who graduated from a global top 50 university to go to the UK with their family for two years to just "explore, work, study and invent". Thereafter, the UK government announced a £118 million skills package that includes a new visa scheme for AI researchers to be brought to the UK at the early stages of their career, as well as grants to help AI workers meet the costs of relocating to the UK.

How has our Overseas Networks and Expertise (ONE) Pass fared in attracting top global talent to live and work in Singapore since it was launched in August 2022? How does it compare, given the heated global competition, to woo talent through a mix of easier visa routes, relocation grants and other benefits?

It is well-known that we are also one of the most expensive cities in the world for expatriates. Besides the issue of soaring rents, foreign expatriates also do not enjoy the substantial healthcare subsidies and utilities support from the Singapore Government. Hence, there is a limit to how much we can tax these higher-income expatriates before they flee to a different country and we lose their tax base, their assets and their expertise. How does our taxation of expatriates compare to other talent hubs, such as London, Frankfurt, New York or Dubai?

Finally, Mr Speaker, in boosting our local enterprises, I suspect a number of my colleagues in this Chamber will have more to say about this, but I just have a narrower focus. As part of our $1 billion effort to develop AI computation, talent and industry in the next five years, will there be grants for Singapore companies adopting AI-based solutions or engaging in AI-related research in the near future? What are the concrete next steps following the publication of our National AI Strategy 2.0 in December 2023?

We cannot forget that AI goes hand in hand with data. Would we extend our AI-catalysing initiatives to activities that are data-centric, even though they might not be AI-centric? For example, research into large volume data processing or sustainable data collection and processing would be key enablers of our AI objectives. So, what are we doing and what are we planning to do for our data sector?

Mr Speaker, Sir, as I have alluded to in many of my previous speeches, we are in a new normal. The circumstances that we see today combine high inflation, high interest rates and possibly for longer, in an increasingly uncertain world featuring frequent shocks. This is not even considering COVID-19, which, today, seems more like a bad dream than a lived two-to-three-year experience.

But through the Forward Singapore exercise, we know where Singaporeans want to head. Help involuntarily unemployed jobseekers bounce back stronger, supporting families and seniors, empowering and uplifting those in need, this Budget hews closely to Singaporeans' aspirations to build a more equal society while not compromising on the economic growth that underpins our security. Sir, I support Budget 2024.

Mr Shawn Huang.

Mr Speaker, how do we value life? In Singapore, in the 1960s, those born then had a life expectancy of 64 years. In the 1980s and 1990s, it improved to 70 to 75 years. Today, we have a life expectancy of 84 years.

Over the last 60 years, our life expectancy in Singapore has increased by 20 years, a 31% increase. How do we value a year of good health? How do we value 20 additional years? Singapore has continued to invest more into healthcare, to take care of Singaporeans, from $789 per capita in 2011, to $2,674 per capita today, a 338% increase over the last 10 years.

How is this made possible? These consistent investments in building up capabilities of our healthcare workers, of our infrastructure, it is a complex and long-term commitment. These capabilities require a confluence of investments in infrastructure, equipment, training and education. There must be sound and sustainable healthcare policies, coupled with a culture of excellence and a spirit of innovation, pushing the edge and frontier of medical research and technology. What does it mean for all of us?

Five of Singapore's hospitals are in the top 150 in the world, with Singapore General Hospital being the top 10. A remarkable achievement. So, imagine, whenever our grandparents or parents are in need of medical care, a surgery or emergency medical treatment, have comfort that there is a team of highly competent and motivated healthcare workers who are one of the best in the world doing their best to deliver world-class care. For ophthalmology, Singapore National Eye Centre is ranked third in the world, and Singapore Eye Research Institute is ranked fifth in the world.

Today, Singaporeans continue to age well and are healthier than before. More can be done and the results are clear. In 2010, there were 700 centenarians and, in 2020, there are more than 1,500, more than double.

Today, most of our five-year-olds can expect to live up to the age of 100. And by 2050, living up to 100 will become a norm for our newborns. The question then again is: how do we value life? What would you do to have an additional year of good health, an additional 20 years of good health to do the important things in life?

If you have an extra dollar, where will you place it? How about the next dollar? And the next? Every marginal and incremental dollar, how would you spend, manage and invest it? How do we get the incremental dollar to live longer, better, healthier and more meaningful lives?

In 2022, ASEAN's foreign direct investments (FDI) have reached a high of $224 billion. Singapore comprised two-thirds of that, at $141 billion. I repeat: two-thirds of all the FDIs in ASEAN.

Singapore ranks eighth globally for inward FDIs and first in the Asia-Pacific. So, what are FDIs? It refers to investments made by a company or individual from one country, investing and having business interests in another. And how much advantage and wealth does that generate for Singapore?

In 2022, Singapore's FDI equals to 31.7% of Singapore's nominal GDP. That is particularly important for Singapore, as it displays the forward-looking economic trajectory. FDI creates quality employment, facilitates and encourages technology transfer. It spurs infrastructure development and increases our export capacities.

Singapore's economic achievement today is built over decades, with leadership, bonus and collective teamwork. This requires a confluence of economic and social factors, balance for sustainable future for all.

It is not by sheer luck that we could earn that one incremental dollar. It matters deeply. It matters because we must understand the difficulty and the amount of collective effort, as a nation, to be in a position of strength.

The investment climate, how connected and coherent is our infrastructure? How skilled and nimble is our workforce? Our legal frameworks, technology and innovation, our international agreements? How accessible are our market and trade?

How ambitious and energetic are our citizens? There are also social factors that are equally important: our social and political stability, our healthcare systems, education and quality of life. All these factors are what attract companies and individuals to invest time and resources here in Singapore. It remains attractive because of what we have been doing for decades. It must be so for the next 50 years and it must be so for the next hundred years.

How do we value our future and our future generations? The lifespan of a country is 158 years, whilst an empire is about 250 years. This is historic data, and we are at our 59th year mark and approaching our 60th.

On this land that we stand and live upon for the last 700 years, it has been tumultuous. From the 13th century, starting with history from Palembang, the Srivijaya empire to Majapahit, to Melaya then to the British, then to the Japanese, back to the British, Malaysia and then Singapore – all these in the last 700 years.

And we must remember our vulnerabilities as a nation-state. History is replete with lessons to be learnt and relearnt. The ancient Republic of Venice, the Republic of Genoa, Carthage, Sparta, the Byzantines – where political fragmentation and external pressures eroded state powers and the Hanseatic league.

How determined are we, that after a hundred or 200 years, that we are still a sovereign and independent state, against all odds and statistics, to surpass beyond the average lifespan of empires and countries?

Some estimate that our Reserves are just below $2 trillion. To put things in perspective, assuming that our estimation is accurate, our Reserves are worth less than Apple. It is worth less than Microsoft. It is worth less than Google and, more recently, Nvidia decided to be more valuable than us. So, when you make your next purchase of an Apple product, Microsoft or Google, or the next graphics card with Nvidia, remember that their market capitalisation is higher than our entire national Reserves.

Our Reserves are worth less than the companies that I have mentioned. It is worth reflecting on how we plan to save, invest and allocate our resources for the future. We are fortunate to have the Reserves that can power a Budget that we have today. It is made possible because of the prudence and the value of our founding and past generations. It is this consistent act over numerous decades that enabled us to take care of all Singaporeans, for all to lead a longer and better life.

How do we value the lives of our children? Save the Children ranked Singapore the best place to grow up. We give our very best to our children and our future generations. In 2013, Singapore spent and invested $8,550 for every primary school student. In 2020, the Government invested $13,350.

Everyone has access to quality education. We have the basis to debate about education every now and then because we have gotten the basics right. Remember that we are of that generation 20 to 30 years ago where we had much less resources and knowledge. It is not perfect, but we progress and make relevant.

We embark on lifelong learning, instil adaptability and self-learning to ride the tides of changing technological advancements and build resilience to our relevance of skills and competencies. In the past, work was more linear and the pace of change was gradual. We saw how we restructured again and again, securing one generation after the other and building on one another's success.

Today Singapore's workforce stands amongst the most proficient in terms of management, vocation and technical skills. According to INSEAD's annual Global Talent Competitiveness Index, Singapore ranked number one in global knowledge and skills, which included management and communication abilities; and third in vocational and technical skills. And this is out of 134 countries.

This year ITE celebrates its 32nd anniversary and it continues to build strength to strength. We do not say that we are doing well, that we have accumulated enough capabilities and that we can invest less in our education system. We do not say that we are too high in our rankings and that we can afford to drop a little, because this is insidious.

Is there space for a city state to be a bit lower in our commitment to the future – to our future generations?

We cannot.

We cannot because as Singaporeans deep within our core, we know what it takes to be relevant and we know what it takes to take care of our future generations.

How do we value life? More importantly, how do we cherish it, respect it and be good stewards of the life given to us?

Gaza has one of the youngest populations in the world. Forty percent of Gaza's population is 14 years and below. The median age is just 18 in 2020. Those age 65 years and above are less than 3% of the population. In Ukraine, the male life expectancy has decreased from 67 years before the war to 57 years after, or right now. For women, it has declined from 76 to 70 years.

And it is not just about war and conflict alone. Countries with high levels of violence experience lower levels of life expectancy more than peaceful ones, estimating a gap of around 14 years – between the least and the most violent countries. It is not just conflict related, but also many other factors – homicide, violence, quality of life, education and all. We are building version 1 and version 2, just like how internet browsers and applications evolved, with progressive and improving versions. We must do so and build better versions ourselves and for Singapore.

We cannot expect to be perfect in all we do. But we try. And we try harder, in delivering better capabilities for better life every day. It is called building – building for the future. Today's capabilities were built by past generations. And as we build for today and for future generations – a life that is longer, healthier, more meaningful, more fulfilling and inclusive for all.

Just like our shining examples – Singapore Airlines and Singapore Changi Airport. It is not an achievement of probability. It was not a rare occasion marked by a cosmic alignment of constellations. It requires effort – collective effort from all Singaporeans.

So, let us all build together for a better tomorrow. Mr Speaker, I support the Budget.

Mr Speaker, I stand in support of the Budget and may I also stand in support of the speech by my immediately preceding Jurong Group Representation Constituency (GRC) colleague, Mr Shawn Huang.

Just the other day, I met a young Clementi family – daddy and mummy with their little girl, just a few months' old. We talked about how the world has become more dangerous; more uncertain; full of challenges – a dangerous world. A world where big countries bully small countries and sometimes invade them – invasion and occupation. A world where small nations and small communities can come under siege, have their water supply cut off; electricity supply cut off; food and access to medicine blocked. A world where climate change is accelerating, where sea levels are rising and that means a world where some islands in 50 to 100 years' time, will be underwater; a world where some island-nations may not exist by the end of this century.