Mr Speaker, Sir, thank you for this opportunity to join in the debate.
After PM spoke about more changes to the CPF at this year's National Day Rally, there has been much discussion and speculation on the ground as to the details. I have met with various groups of union leaders from different industries, and listened to their feedback.
Clearly, the fear of job loss is topmost on workers' minds, as the economy continues to be weak. Many have been retrenched, or know of people who have been retrenched. Many have seen business being lost to lower-cost competitors. They know that if the situation does not turn around soon, more jobs will be at risk. And they themselves could be next in line to be axed. Hence, workers really hope that the Government would find ways to boost prospects soon, and relieve their anxieties.
Union leaders understand the big picture. We know that unless jobs are saved, there will be no income for the workers and without an income, high CPF rates are purely academic. So the priority is to save jobs, and to foster an attractive environment to create new jobs. Lowering business costs is an important part of serving this purpose and we accept that lowering the CPF will form part of such a package.
That said, no worker likes a pay cut, no matter how necessary or helpful it may be because it just goes against the grain to part with one's money this way, and they have their practical concerns and worries. And I would like to reflect these concerns.
Some said that they may run into immediate problems with their housing mortgage payments, and they want to know how they can get help. Others wonder if they will be able to save enough for their retirement years after these cuts and caps. Yet others wonder how they are going to cope with the cost of living, because Singapore is a city, and being a small city-state, there is really no way to go into the countryside for a lower cost of living. Therefore, for lower-income people, I think they will find it harder to cope, and they keep hearing that companies must make good profits for their shareholders.
There are also workers who fed back that payroll is not the only cost to business, but they have the impression that payroll is often targeted for cost-cutting. And they want to know what has the Government done about other fees and charges under its control, and what more it is going to do to reduce its cost burden on the economy.
Workers feel that as the environment becomes more uncertain and volatile, people have to find ways of upgrading and downgrading more flexibly alongside their financial fortunes. So they ask that our policies, for example, in housing and medical services change faster to accommodate this reality. There may be a larger proportion of people who need rental housing, instead of bought housing. I think earlier, this House has gone into quite a bit of questions and answers on that point. Some others also feel that it would be good to make it easier for people, whose fortunes have waned, to downgrade to a lower class ward more easily within our hospital system.
For those impacted by the across-the-board CPF rate cut, the lowering of the contribution ceiling and the consequential increase in taxable income, and that belongs to the upper-middle and higher income group, their feedback has been that they hope for some consideration to minimise the impact.
But overall, workers want to know if their swallowing this bitter pill will really help to spur economic recovery and improve job security.
Sir, just as companies and shareholders expect a good return on their invested funds, Singapore workers are also looking at these CPF cuts as a kind of investment in their collective security and prospects. They do not want this opportunity created by the CPF savings to be squandered by companies merely enjoying a pause in the pressure. They want to know, or at least have as good a sense as possible what the likely yields are going to be, and how these yields are going to be achieved by the companies. They have expectations of the employers. Workers want to know what are employers going to do to get more business because clearly, companies cannot be profitable in the long run just by cutting workers' wages.
Secondly, they want to know what employers are going to do to restructure costs. Restructuring is not the same as merely cutting. It means finding new ways to organise cost drivers so that they are more responsive to changes in competitive landscape and market demand conditions. In this, they want to see more leadership and useful ideas coming out from the employers.
Workers have also asked if employers are alert to new opportunities. Because being alert to new opportunities and being able to seize these opportunities is a critical quality for success. For instance, how many employers have plans to make use of the US-Singapore FTA and other FTAs that Singapore had signed to improve their business? According to a report in the Straits Times on 4th July, a certain chamber of commerce in Singapore did a survey among its membership. And of those companies who responded, 71% said that they could see no gains flowing from the US-Singapore FTA. The business community's response to the latest Singapore-India Comprehensive Economic Cooperation Agreement is not any more reassuring. A veteran businessman was quoted in a Channel NewsAsia report dated 26th August as saying, "This is a weakness in our system. Businessmen leave it to the Government to decide everything. They should be pushing for what they want. Some of them do not even know what they want."
Sir, I am saying this not because of any other purpose than to say that this CPF cut gives us the savings so that we could improve our competitiveness, so that our economy can rebound. Workers hope for this to happen. But in order for this to happen, employers must play their part and go and get that business. Otherwise, it is a wasted opportunity and it is a high price that workers would have paid in vain. And we must not let such a thing happen to sink our hopes.
Sir, we are in a no-holds-barred global and regional fight. We have to remove our gloves because our competitors are coming at us with bare knuckles, if not knuckle-dusters. If we lose, we will have to accept much lower conditions of living. We therefore have no choice but fight. So, I support these CPF changes, even as I feel the pain together with all workers.
On the side of the NTUC, we will support constructive efforts to improve the competitiveness of companies because we want to save jobs and to attract the creation of new and better jobs for Singaporeans. And we will do so on the basis of fair play for workers. Here, I want to thank the Prime Minister for supporting the stand taken by NTUC in asking that companies that are doing well be fair to their workers and share the gains with their workers.
NTUC cooperatives will continue to play their social role and help hold down the cost of living.
On the part of the Central Singapore CDC, besides the usual assistance schemes, I will also set aside additional funding to reinforce the accounts of the Community Resilience Fund at constituency level so that our MPs on the ground can offer help more responsively as required.
But most of all, I urge immediate and clear action from employers. Do not waste the opportunity and become complacent just because the CPF savings have bought some time and offered some reprieve. Show our workers that you have concrete plans, and are taking active, systematic and resolute action to improve the odds.
I know that in these days of intense competition, employers have to watch their monthly and quarterly bottom lines like a hawk. But I want to remind employers that the best companies that triumph in the end are the ones who not only know how to make big money, but who also know how to treat their people right while making big money. Those who think that rewarding loyalty is out of date will pay a price for it when the market turns.
The March issue of Fortune magazine featured a list of the world's "Top 50 Most Admired and Successful Companies" as compiled by the Hay Group. Among the characteristics of the winners is their encouragement of teamwork, loyalty and collaboration. Smart employers do not pay lip service to people development and loyalty. Workers are not stupid. They know whether their employers are treating them as valuable members of the company or as disposables. And they will reciprocate.
Sir, as we set about implementing these difficult but necessary moves to energise our economy and job market, I urge everyone to keep our eyes firmly focused on achieving the common good and creating our shared destiny. And as we do, we will keep the trust and the respect of our workers and our citizens.
