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Mr Speaker, thank you for allowing me to join the Debate on this year’s Budget.
At Budget debate 2018, I called for tripartite discussions to determine the new longer term retirement and re-employment ages.
At last year’s Budget debate, I expressed hope that the Tripartite Workgroup formed by MOM in May 2018 to negotiate higher retirement and re-employment ages and enhanced CPF contribution rates would soon come to a win-win outcome so that older workers would have added confidence about their employment and retirement savings. As Singapore’s population is aging, progress in these areas is necessary and important to help sustain the added years.
PM Lee announced at last year’s National Day Rally the consensus reached by the Tripartite partners to raise retirement age progressively from 62 to 65 and re-employment age ceiling from 67 to 70 over the course of a decade. Specific first moves were also announced, namely, to raise retirement age from 62 to 63 and the re-employment age ceiling from 67 to 68 in 2022. One year before that, in 2021, first steps will be taken to raise the CPF contribution rates for workers aged 55 and older.
The agreement that we reached shows the strength of our tripartism to tackle real and serious issues. It also showed the Government’s commitment toward looking after the interests of older workers.
On behalf of older workers, I thank the Government and the Singapore National Employers Federation (SNEF) for working hand in hand with NTUC to achieve these win-win outcomes.
A year has passed and we are now in Budget Debate 2020. How fast things have changed. Since January, the Singapore economy has been buffeted by the negative disruptive effects of the COVID-19 virus outbreak internationally even as the downsides of the US-China trade war continue to slow global trade and growth.
Against this background, Singapore’s growth forecast has been revised downwards significantly, from between 0.5%~2.5% estimated in Nov 2019 to between -0.5%~1.5% in Feb 2020, within three months, it was revised downwards significantly.
On the ground, these changes in projections reflect falling demand, supply chain and manpower disruptions, as well as cost, credit and cashflow pressures and worries for companies. These worries for companies in turn translate into worker concerns over loss of overtime and other income, wage freezes and cuts, and increasing anxiety over the security of their jobs.
Older workers, both executives and non-executives, feel vulnerable in this environment. They are afraid that in any industry or company shakeout, they may bear the brunt. They are also worried that if they are displaced from their jobs, it would be more difficult for them to find new work or to expect to maintain anything near their original pay levels. And if that happens, it would erode the progress of prior efforts to strengthen the sustainability of our aging population over the long run.
Older workers therefore look to the Government and to this Budget for reassurance. They hope to see and want to trust that this Government continues to have their backs and would lean forward to safeguard their interests and ensure that they are fairly treated. The Labour Movement hears their concerns and have lobbied hard on their behalf with Government.
This Budget has given older workers that reassurance. I thank the Government for understanding worker’s needs and worries, and for addressing our older workers’ concerns.
I would like to highlight specifics in the Budget to make my point.
Consider the announced CPF contribution rates improvements meant for 2021. The worry as expressed by older workers is that given the headwinds the difficult economic environment that we are facing now, they worry if the Government would now decide to postpone or cancel those improvements. And so when they heard the Budget, they heard that the Government has instead stepped forward to help defray the cost pressure on employers that those improved CPF rates will bring. In other words, what the Government has promised older workers in these improved CPF rates in 2021 will be done. This is the Government keeping its words to our older workers.
But workers then worry that if they should lose their jobs in the meantime, or cannot find a new one if they are displaced, then improved CPF rates or for that matter, raised reemployment and retirement ages would be moot. Here too the Budget have measures aimed at lowering such risks for older workers.
Under the Stabilisation and Support Package, Government will introduce a Job Support Scheme. This Jobs Support Scheme (JSS) will help enterprises retain their local employees during this period of uncertainty. Employers will receive an 8% cash grant on the gross monthly wages of each local employee for the months of October 2019 to December 2019, subject to a monthly wage cap of $3,600 per employee.
This is on top of the Special Employment Credits and the Additional Special Employment Credits previously introduced to incentive the hiring of older workers. These 2 incentives will be combined into a new Seniors Employment Credit Scheme.
Government will also enhance the Wage Credit Scheme to further help shoulder the cost of wage increases for workers. These moves make each existing employee less costly to their companies and therefore, lower their overall risk of retrenchment or help companies hold off retrenchment for as long as possible.
For older workers who are displaced, there will be a hiring incentive for employers who hire local jobseekers aged 40 and above through a reskilling programme. For each eligible worker, the government will provide 20 per cent salary support to the employer for six months, capped at $6,000 a month.
There is even another incentive for employers who are prepared to hire older workers on a part-time basis. This will help make older workers who are unable to work full-time more cost-effective for employers to consider hiring.
By the sheer number of targeted subsidies and incentives aimed at sustaining and spurring continued hiring of older Singaporean workers in this Budget, the Government’s care for and commitment to our older workers is crystal clear. And our older workers appreciate this.
While keeping one’s job or being able to get back into one quickly in the event of retrenchment are of immediate concern in the current economic climate, our older workers also know that their longer term employment and employability really depend on whether they can keep up and adapt with the changing technology and business models and methods.
Here, they look to Government and tripartite partners to do more to help them stay skilled and relevant to the changing times and requirements.
Government is certainly doing its part to energise skills building for the benefit of workers and companies in this Budget.
In terms of enabling skills building through funding, the Government is introducing the Next Bound of SkillsFuture through this Budget. There will be more money given to individuals and companies to undertake training via SkillsFuture. There will be a second top-up of $500 to the SkillsFuture accounts of all Singaporeans aged 25 and above, while middle-age workers will get an additional $500. There will also be a new SkillsFuture Enterprise grant to defray up to 90% of companies’ business transformation, training and job redesign costs. These incentives, together with substantial existing grants and subsidies from Enterprise Singapore, Workforce Singapore and other economic agencies, again goes to show the Government’s firm belief in enabling individual and corporate investment in building skills and capabilities for greater competitiveness and in enhancing the employment and employability of our workers.
On the Labour Movement’s part, as elaborated by my fellow Labour Members of Parliament earlier, we introduced last year the Company Training Committees (CTCs) as platforms to bring companies and unions into partnership over skills building, and to inject Government resources and support for such initiatives through this channel and platform. This is a practical way to proactively and systematically upgrade companies’ and workers’ capabilities, and to help build momentum for the overall transformation of the Singapore economy. Good progress has been made in this area, and 352 CTCs have already been formed since its inception in April last year. The provisions of this year’s Budget can certainly give a boost to the CTCs’ efforts, and I urge tripartite partners to make full use of these resources to press ahead with investing in our workers’ training, across all ages.
For displaced workers, finding a new job quickly is important. This is especially so for older workers as experience tells us that they will find it more difficult to find a new job and maintain their previous pay. This affects not only rank and file workers but is actually so for all levels and ages of workers, affecting also middle age professionals, managers and executives (PMEs).
In this Budget, through the SkillsFuture Mid-career Support Package, the Government is going to double the job placement of professionals via the Professional Conversion Programmes (PCPs). Such professionals will be able to find new career runways through the PCPs’ skill-up-and-switch roadmaps. I fully support this and I have one call for the government to consider which is to broaden the age criterion, currently set between 40 and 60, and include those up to the current re-employment age ceiling of 67. The reason is because all the factors that we argued about the 40 to 60-year-old having the vulnerabilities, they will certainly also apply to those from aged 60 to 67. Indeed, if the latter group were to lose their jobs, the challenges will not be less than those aged 40 to 60. At the same time, the scheme itself has certain safeguards, thus, I feel it is good and proper to broaden the criteria to include workers up to the re-employment age ceiling of 67 and to continue in this way to again show the Government’s commitment towards their employment, employability and welfare.
In this area of boosting job search and placement, Government will find an enthusiastic innovator in the Labour Movement. As SG NTUC and Minister (PMO) Ng Chee Meng said earlier, NTUC will be spearheading the Job Security Council (JSC) in partnership with industry to go beyond what NTUC’s e2i (Employment and Employability Institute) has traditionally done for individual job seekers and individual hiring companies. Through proactive information sharing and planning, JSC and CTCs can work together to efficiently facilitate training, re-training and placements between manpower-flushed areas and manpower-starved ones. Such system-level efficiency in manpower re-deployment will further sharpen Singapore’s overall competitiveness that is good for businesses, and it will certainly help shorten the periods of unemployment for workers who are seeking new jobs.
Sir, as the saying goes: “When the going gets tough, the tough gets going”. We have to face down both the immediate COVID-19 threat as well as shape up for the big challenges and opportunities that the future economy will bring. I heard DPM over the radio, as he was discussing the various aspects of the Budget and exhorting everyone to keep our spirits up and do our best together, quoting a Hokkien song title, “要拼才会赢”, which means that success comes through effort and striving.
He is absolutely right. Success will not come from just taking painkillers or hunkering down. It will come from taking action – concrete, purposeful, effective action.
The Labour Movement stands ready to work with Government and employers to tackle this tough patch and simultaneously build that better future of better wages, welfare and work prospects for all workers. Because “Every Worker Matters”, now and always.
I support this Unity Budget.
Thank you.
