Mr Speaker Sir
Some workers ask: With these CPF changes, how many jobs will be created? How many will be saved? They are disappointed that there is no road map for economic recovery. They don't feel secure. They want to see a plan that says: Do this to get to point A, then do that to reach point B, and all will be well.
Unfortunately, there are no precise answers to what the CPF changes will bring. Technology and the world economy are changing too quickly for anyone to be able to draw up blueprints that come with a guarantee.
That does not mean there will be no jobs created or saved. What it does mean is that the right economic environment will lead to the creation and saving of jobs, even though there are no mathematical models to give us the exact numbers.
This is a bit like planning to build the bird sanctuary at Sungei Buloh. If people asked at that time: How many birds will come? What type of birds will come? How long will they stay? - then the bird sanctuary might never have been built. No one could have given those answers. But the designers who understood bird migratory behaviour knew that if we built a sanctuary with the right environment, the birds will come. And they did.
So is it the same with the economy. Get the economic and investment climate right, and the jobs will come. Precisely what jobs will come, or how many? No one can tell. But even as we debate the CPF changes in this Chamber, decision makers around the world would have read about our strong effort to make Singapore a good place to invest in. We may not even know who those investors are. The products and services they might bring here may not even have been announced yet. But if we can bring our labour and business costs down to a level that gives good value for money, more investments will come. That, we can be confident about.
Among the companies already in Singapore, some are doing well. They do not need the CPF cuts to survive. They should give some, or all, of the savings back to their workers. The SBF and SNEF have bluntly dismissed the idea. But I am glad that since last Thursday when the Prime Minister made the announcement, several companies have already indicated to the union leaders that they will share the gains with their employees. Such enlightened managements are to be applauded. I urge companies that are doing well to follow their good example in being fair to the workers.
Dr Ong Seh Hong and other MPs pointed out that one reason workers will have low retirement savings is that the rate of return on the CPF savings is low. In this climate of low returns on fixed income instruments, it is difficult to get higher returns. Workers should not risk their hard earned money on high risk investments to seek higher returns. They may lose much more than they gain.
The NTUC will do what we can to help. NTUC has a savings co-operative, NTUC Thrift. Its social mission is to help workers put aside small sums of money every month for a rainy day. Since its formation, NTUC Thrift has consistently given an interest rate on the small savings higher than what the banks give. With this renewed impetus to ensure sufficient retirement savings for our workers, the unions will work with employers and NTUC Thrift to encourage more workers to open accounts with NTUC Thrift.
Employers who wish to give the gains from the CPF cuts as lump sum payments can help the workers deposit the money into NTUC Thrift accounts. To the individual worker, it may not seem a large sum at first. But if workers can continue to set aside small sums every month, and keep their money untouched for long enough, NTUC Thrift will work hard to grow their money at better than bank rates. In the long run, the money will be useful for retirement, or to help cover a period of unemployment.
Sir, I support the CPF changes.
