Dear Comrades,
Welcome to the Industrial and Service Sectors Gathering cum Membership Seminar 2005. This is an annual gathering for our union leaders to share insights and discuss key issues of importance to the labour movement.
2 There are many key challenges facing us. With advances in telecommunication and transport, talent, funds, information and businesses have become more mobile. Businesses will go to places where they can gain the most competitive advantage. Businesses competing on cost will go to places where production costs are the cheapest. On the other hand, the best talent will readily go to places where they can enjoy the best rewards and lifestyle to be offered.
3 What does this mean for Singapore? This means that our manufacturing industries will increasingly compete with other manufacturing centres, most notably China. We will have to compete with the likes of New York and London for the best and brightest in business services or academia. This means that the wages for both top talent and the lower income will be determined not by Singapore but by the global market. And the trend points to a widening income gap.
4 These are general trends affecting most countries and industries. In Singapore, we cannot be exempt. Collectively this means that there are many key issues facing most of our industries and sectors today. We will be discussing some of these key issues today. They are namely, Implementation of Key Performance Indicators, the Employability of Older Workers, Portable Medical Benefits Scheme and finally Organising and Reaching out to the Young.
5 We must recognise that it will be hard to compete purely on wages with workers from the low cost countries like China and India. As companies become more cost conscious, companies are moving away from wage increases, which will increase their fixed operating costs. Workers are rewarded through variable bonuses instead. Hence there is an increasing need for the unions to encourage more companies to establish clear key performance indicators (KPI) linked to the bonus system. This will help to motivate and set clear targets for the workers and enhance the profitability of their companies. Workers will know what they need to do, and they share when higher profits are achieved.
6 At the same time, wage restructuring needs to take place to make wages effectively flexible. This flexibility helps to keep more companies from moving out of Singapore for a longer period of time and provides more time for the workers to upgrade themselves and move up the value-add ladder.
7 Singapore is fast becoming an aging society like all other developed countries. Older workers will eventually form an increasingly key component of our workforce. The older worker of the future, and indeed today, will have fewer children to depend on compared to their predecessors. Therefore workers need to work longer to reduce the financial strain on their families. Being gainfully employed also helps to maintain their quality of life, not just financially, but also in terms of enhancing their sense of dignity and self-worth.
8 Nevertheless, raising the retirement age by legislation is not the solution. Although our retirement age is 62, many retire, or are retired, well before 62. So, we should raise the effective retirement age instead. To do this, we have to change the perceptions of older workers among both employers and workers. We have to identify specific industries or sectors where there are more potential opportunities for older workers, and work on suitable measures to increase their chances of employment. This issue will of utmost importance to all workers, therefore I urge all of us here today to discuss how to encourage employers to take older workers and under what conditions.
9 As jobs are becoming less permanent in nature and unemployment period is extending, especially for older workers, there is a need for portable medical benefits (PMBS) to ensure that workers continue to enjoy medical coverage even during periods of unemployment. Adoption of PMBS is critical to prevent older workers from being discriminated as they age. It also allows workers to save up on their own medical costs when they are young. I have heard that the take up rate remains low, as companies are reluctant to increase their medical costs and workers are unwilling to forsake their full medical benefits that their companies are currently providing. We need the unions to explain these advantages to our members as the medical benefits coverage will be gone once one is out of job and members have to pay high medical costs when one ages and falls sick.
10 Another key challenge facing unions today is the declining OB membership. Everyone who is a member, be it OB or GB, is a union member. However, we want to represent them fully, as fully as we can. Therefore we should extend union coverage to GB members as far as we can.
11 Next, a labour movement will be irrelevant if we cannot attract the young to continue the work we have worked hard for. To have an intuitive feel of what our younger members need and want, it is also critical for us to have fresh blood within our union leadership. Marketing to the young will be a challenge to both NTUC and the unions. Therefore I encourage all of you to take this matter seriously and discuss what the labour movement should do in this matter.
12 In conclusion, I hope that all the participants here today will be able to share and discuss on how to serve their members better. It is our duty to act. Do not allow old practices and constraints to bind you to think that new ways cannot be done. Allow yourselves to think and act out of the box to serve our members better.
Thank you.
