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Working Together to Fight Inflation
Sir, first let me declare my interest as the Group CEO of NTUC Enterprise and the FairPrice Group.
Sir, this Budget looks into the future, even as it runs for the third year into the red. The bills come not just from the price of security and safety today, but for the education and the investments of tomorrow.
The rising inflationary pressures come from different sources and are complex in nature. The impact, however, is simple and direct – a dollar today can buy more than a dollar tomorrow.
I want to speak on two groups that are particularly hard hit – small businesses and the cost of living for the ordinary men and women.
Assisting SMEs in Dealing with Cost Pressures
First, cost pressures faced by SMEs. Many SME suppliers, they are all struggling now to manage the cost increases that are coming from all fronts; some describe it like a ‘tsunami’.
Whether it is raw materials, freight, manpower, packaging or cost of energy, everything is more expensive now. Added to that the headwinds from tough weather, floods and logistical disruptions due to Covid restrictions.
For SMEs in particular, where profits can be razor thin, it is about cost pressures and stresses of managing rising costs in many areas – and these sometimes can appear to be faceless corporate troubles.
But when businesses fail, jobs are lost too. And behind each SME is a group of men and women with dreams and families.
One SME owner shared with me that the cost of his raw materials for soya sauce, they include soya bean — prices have gone up by 20 percent; sugar and salt, that’s up 30 percent. And the freight cost of shipping raw sugar from Thailand to Singapore, it has increased from what used to be less than $200 per 20-foot full container load is now almost $1,000, that’s almost a five-fold increase.
The current conflict that is taking place in Russia and Ukraine, it will add further cost pressures to businesses. Amongst other things, Ukraine is a major supplier of sunflower seed, sunflower oil, whilst Russia is a major supplier of wheat which will impact raw materials supply and costs of wheat-based products. Ukraine is also a major producer of corn. And corn supply shortage may also impact price of livestock feeds where corn is a major ingredient. Indeed, many egg suppliers have told me that their costs have gone up very significantly, where energy costs, and corn, which is the feed for the chickens, they are major cost items for them.
In its annual survey last year, the Singapore Chinese Chamber of Commerce and Industry (SCCCI) sought feedback from more than 1,000 businesses, 92 percent of whom are SMEs.
Many say their costs have gone up quite significantly, and as a result, they have suffered losses. For sure, some 57 percent of Singapore businesses surveyed saw their costs rise this year, that’s nearly double the 28.8 percent who did so last year.
SMEs form an important part of the Singapore economy, including as a source of jobs and meaningful livelihoods. And often the voices of small business owners, they go unheard.
So what can we do to ensure that SMEs have a place at the table? For example, trade associations, they play an important role in gathering feedback as well as explaining new policies and schemes to its members. Such associations may run on a tight budget, which constraints their effectiveness.
Can the Minister consider providing some one-off grants to such associations?
On the impact of cost increases, I think some price increase in products and services may be expected. Of course, there are those few errant businesses who may take advantage of the situation to profiteer. Like everyone else in this House, I have no sympathy for them, and they should be taken to task.
I am sure the Committee Against Profiteering headed by MOS Low Yen Ling, when the committee formulates the guidelines against profiteering, I’m sure they would with the help of the community, step up their vigilance in light of the current situation and ensure that those who use, whether it’s ‘inflation’, ‘GST’ or whatever to cover a multitude of price increases, they will be taken to task. At the same time, we should not begrudge businesses and SMEs for legitimate and reasonable price increases for the reasons that I shared earlier.
Finally, I would like to bring up an ‘ask’ from SMEs — the issue of manpower. Given the important role that migrant workers play in Singapore’s economy, I would like the Government to give some flexibility to businesses, and in particular, SMEs, in hiring such workers.
Now, let me now switch to the other group, and speak about the cost of living faced by individuals and families.
Helping Individuals and Families Moderate the Cost of Living
Cost of living is a perennial issue. I am not sure about the rest of you, but my grandparents, my parents, my peers, and now my own children, they are also talking about it — I think no one will ever say things were cheap during their time.
Our forefathers carried these worries too. But through determination, hard work and with support from various people and Government sectors, they not only survived, but they prospered and built the foundation of a thriving Singapore.
NTUC was certainly one of those partners. In fact, NTUC FairPrice, (NTUC) Welcome then, was born at a time of rising prices in the oil shocks of the 1970s. Just two Mondays ago, we announced the ‘Stretch Your Dollar’ programme to give a 5 percent discount on 100 essential items every Friday. We shall start the first in March. We ran similar ‘stretch your dollar’ programmes in 2007 to 2008 during the global financial crisis and again from 2010 to 2011 during the economic downturn.
Overall, NTUC’s focus is on ensuring workers in Singapore remain competitive and employable for life, as well as enhancing their welfare. To do this, NTUC strives to help workers of all collars and ages get better jobs and earn better wages.
At the same time, NTUC supports workers and their families by moderating the cost of living through various programmes, including sustainable wage increases in the form of PWM (Progressive Wage Model), subsidised training, financial assistance schemes, and affordable daily essentials and services through the NTUC group of social enterprises.
Within the NTUC group, we have various charities and foundations. They include U Care Fund, FairPrice Foundation, Orange Aid, Eldercare Trust and the Bright Horizons Fund to ensure those who have less, they are not disadvantaged. In fact, when I group all these together, over $441 million dollars would have been given out.
Over the years, the NTUC Enterprise group has evolved to be significant industry players today, whilst continuing to take care of the needs of not just workers, but also their multi-generational families across their different life stages.
We strive to play our part to moderate costs of essential goods and services, serving as price benchmarks and addressing underserved needs.
Of course, we are not the only ones doing this, and there are many, many helping hands all over Singapore to help those in need.
I would like to ask if the Government can consider the following: First, can we on a whole-of-government and whole-of-society basis, coordinate, encourage efforts which keep basic items affordable to help cope with cost of living? This can either be in the form of giving guidance on specific items or tax incentives for doing so.
Second, keep looking out for those whose incomes have been lost or reduced during the pandemic, and to provide support for those who might fall through the cracks such as those with limited family support. And related to the second, perhaps it is not just a matter of having more schemes, but helping more people become aware of and applying for such schemes. Yes, we need to extend more help to those less tech-savvy workers to apply for Government schemes — they are often the ones who need it most.
Even as we help address their welfare needs, we can also help them see where they need help in terms of upgrading their skills and securing jobs.
Conclusion
As Singapore develops, aspirations today are understandably different from the past. We are better educated, technologies have empowered convenience, and lifestyles have evolved.
But one thing remains: we continue to want the best for our children and for the next generation.
In the past, a dollar’s value is measured by its ability to buy a home, to go to school and put a meal on the table. Today, a dollar can already do this for most of us, and we want it to buy more.
Mr Speaker Sir, the challenges have become more complex today — ageing population, maturing economy, sandwich generation, cost of living, climate change, global competition for talents... What we need to buy with our dollar is security for all Singaporeans, to be able to continue our common dream of peace and prosperity amidst rising and uncertain seas.
Sir, I support the Budget.
Thank you.
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