First let me wish all Muslim comrades Selamat Hari Raya Aidil Fitri.
We have almost come to the end of 2003. By any account, this has been a very eventful year. So many things had happened. For Singaporeans, SARS was easily the most unforgettable incident. As a nation we grieved for the many lives that were lost, particularly among health care workers who were at the forefront in the battle against SARS. The impact of SARs however was much wider. The airline industry suffered the most as people were afraid to travel and stayed at home. Workers in the airline industry had to take pay cuts and were also affected by retrenchments. CIASEU was not spared, as your members too were retrenched and were affected by other cost cutting measures.
The economy is recovering and airline travel has picked up. But bigger challenges remain for the industry. The proliferation of budget airlines is one such challenge. Budget airlines cater largely to the needs of budget conscious tourists. It has existed for many years in the West but now some are operating in Asia. This will put intense pressure on airlines to reduce costs to maintain their share of the business. Even business travel will not remain the same. A report on the airline industry pointed out that business travel has accounted for an ever smaller share of airline revenues. Corporations are also driving hard bargains in order to reduce the cost of travel. Some have used their purchasing power to negotiate volume discounts. With advances in technology, facilities such as video conferencing would reduce the need for travel. After 911, increased security measures at airports have also resulted in an increase in costs.
Understanding these issues that are affecting the industry would help us to better prepare our workers for the changes that are taking place. It will not be an easy period of adjustment. To reduce costs, employers will look at different ways of doing work. Outsourcing of work have become more frequent. This can involve outsourcing to companies in Singapore or to those in other parts of the world, typically involving functions such as IT or accounting. A lot more of part time and contract work will be used. It is important therefore that we continue to focus on skills training and upgrading to ensure that workers remain employable. Workers who are trained and skilled have a distinct advantage over those who are not. Those with skills will also be able to enjoy better pay. This disparity in pay and jobs exist not only in Singapore but is a global phenomenon as there is a global competition for skills and talent.
The use of more part-time and contract work also requires us to take a closer look at the way some of the benefits are currently structured whether in our laws or in our collective agreements. Under the Employment Act for instance, an employee is entitled to paid sick leave only if he works for at least six months. So a person who is employed for periods of less than six months will never enjoy this benefit. It also means that a lot more of our benefits will have to be portable, so that workers don't only chalk up credits in one company but lose everything when they move to another company.
One important portable benefit is our CPF contributions. Almost all the other benefits are employer based. Our efforts at introducing the Portable Medical Benefit Scheme will make medical benefits more portable.
Increasingly, a lot more of our wages will be based on company and individual performance. Although 70% of our wages will remain stable, it will also mean that wage increases will no longer be automatic but will depend on how workers contribute to the company's bottom line. We will have to take this point into consideration before taking on any loans or other financial commitments that will tie us down to long term payments. Part of our financial planning will also have to involve saving some money for periods when we are in between jobs. The amount that we should set aside should be sufficient to at least take care of our needs for between three to six months that we are out of work. It also means that a fair and transparent appraisal system is important to reduce subjectivity and inspire confidence. I think that it is fair to say that workers can agree to the principle that their pay should be tied to how they perform, provided that there is a proper system in place that measures everyone fairly and motivates and spurs them to achieve. Often the dispute is not about linking a part of wages to performance, but about how the assessment has been conducted. For a performance based system to work it is also important to have in place in place a profit sharing scheme that rewards the contributions of all workers fairly.
So, the future will be a much rougher ride for all of us. During such times, the role of the union becomes even more important. We have to ensure that there is a strong union presence to represent the voice of working men and women and ensure that their interests are protected. But a union is only as strong as its leadership. Strong and capable union leaders are important for the future of the labour movement. We have to continuously develop and nurture union leaders who are knowledgeable and have the skills to carry out their duties effectively. As leaders, it is important that we upgrade ourselves continuously. There are many opportunities for doing so. The OTC Institute of Labour Studies, for instance, runs many courses dealing with various aspects of union work. But attending courses should be only a part of our overall quest for knowledge and skills. We too need to imbibe the spirit of lifelong learning in dealing with union work. For instance, we need to read widely to keep abreast of all the latest developments affecting us and the world of work. This is not only important so that we can understand and carry out our work more effectively but it will also greatly facilitate our efforts to engage union members. Our workers are now better educated and more demanding. They will not be happy to be passive recipients and observers but will be keen and interested to participate actively in decision making and policies of the union. Our unions must be able to rise to this challenge. But union work is not about people with skills and knowledge alone. A lot of it has to do with commitment and dedication to the cause as there are tremendous personal sacrifices to be made. And it doesn't help that despite the vast contributions of our unions to stability and progress, there are still managements that do not understand nor appreciate the union's role.
As we move ahead, we need to focus more on strengthening bipartite relations at the company/union level. It is important that managers too understand what are the critical underlying factors that contribute to Singapore's industrial peace and stability, and this should permeate throughout all levels of management. If unions are to play a constructive role in the process of change, then they must first be persuaded that the change, though painful in the short term, will be beneficial to workers in the long run. This can only come about if there is active engagement with the union and effective sharing of information. Equally important, there must be a high level of trust and confidence based on mutual respect and a sincere appreciation of each other's role. It also requires management to view workers not as just another cost item on the accounting sheet but as stakeholders in the company with needs to fulfill but also with the capacity to make meaningful contributions at work if they are given the opportunity to do so.
On this note, let me take this opportunity to congratulate your union for having provided the leadership and support to workers in CIAS during this past year in the face of great difficulties. I am confident that you will continue with your good work and will act as a strong voice for workers.
Thank you.
