1 Mr Louis Ng Kok Kwang asked the Minister for Education (a) what percentage of (i) Primary schools (ii) Secondary schools and (iii) post-secondary educational institutions currently have at least one lactation room; and (b) whether the Ministry can make it compulsory for all schools and educational institutions to have at least one lactation room.
The Senior Parliamentary Secretary to the Minister for Education (Ms Low Yen Ling) (for the Minister for Education): Mr Speaker, Sir, MOE is committed to providing a conducive workplace for nursing mothers. This includes providing schools with lactation facilities, which has become a standard building specification for MOE.
Today, about 85% of Primary schools, 65% of Secondary schools and 90% of Junior Colleges/Centralised Institutes have a lactation room. For the remaining schools, MOE will progressively provide lactation facilities where feasible over the next three years. Presently, all Institutes of Higher Learning, which means the Autonomous Universities, Polytechnics and Institute of Technical Education (ITE) are equipped with lactation facilities.\t
Mr Louis Ng Kok Kwang (Nee Soon): I thank the Senior Parliamentary Secretary for the reply. Can I just check whether these are specifically lactation rooms? So, it is only for the mothers to use and not just a spare room where the mothers can go in to express the milk. Secondly, can I also just check whether there is a fridge in all of these rooms so that they can store their milk after that?
\tMs Low Yen Ling: Mr Speaker, Sir, I want to thank the Member Mr Louis Ng for his care and concern for mothers. As a mother of two kids, and I have breastfed my two kids for slightly over a year, I can understand what it takes to persevere in the breastfeeding journey. For example, the breastfeeding cycle and also the schedule, from expressing and then storing the milk – and the Member asked about the fridge – transporting the precious milk and also all the gadgets that are involved, especially for mothers who need to express milk in their office, workplace and in this case, in the school.
For the two questions that the Member has, I want to assure him that MOE has made it a priority to equip our teachers who are mothers and who are breastfeeding with the facility and the support that they need.
Let me be clear. Since 2010, the requirement for a lactation room was added to the building specification for Primary schools as part of the PERI upgrading. This is a standard building specification: lactation room in the school. Subsequently, the same building specification for Secondary schools and also Junior Colleges were similarly updated with the same requirement. So, yes. These are lactation rooms, not meant to be multi-purpose for other reasons.
Schools that were built or upgraded before 2010 will also be provided with a lactation room as part of their on-going or scheduled PERI upgrading for Primary schools; likewise, for the Secondary schools and the Junior Colleges, when the institutions next undergo rebuilding or major upgrading. For the lactation rooms, we will provide the necessary facilities and also the fridges; if not in the lactation room, then maybe in the Staff Lounge. We would then have to work with the teachers who are mothers and are breastfeeding to make sure that they will label the bottles accordingly.
The other thing I wish to reassure the Member is, I gave the numbers for Primary schools and Secondary schools. What is very heartening is that to-date, all our IHLs have lactation facilities. In fact, some of the bigger campuses have more than one lactation room. I want to assure the Member that MOE will certainly continue to work with the existing schools to ensure that all schools will have lactation rooms at the nearest feasible date. The target for us, really, is for every school to have lactation facilities within the next three years.
I also want to assure the Member that we in MOE appreciate the sacrifices that mothers make for their children and we will wholeheartedly support their breastfeeding journey.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Regulations that Prohibit Breastfeeding in Public","subTitle":null,"sectionType":"OA","content":"2 Mr Louis Ng Kok Kwang asked the Minister for Home Affairs whether there are any regulations that prohibit mothers from breastfeeding their children in public.
\tThe Senior Parliamentary Secretary to the Minister for Home Affairs (Ms Sun Xueling) (for the Minister for Home Affairs): Mr Speaker, there is no law that strictly prohibits mothers to breastfeed their children in public in Singapore.
Indecent exposure and appearing nude in public are criminal offences. Mothers who are genuinely breastfeeding their children, in public are generally unlikely to fall under these categories. It is not possible to be more specific than that. To determine if any offences might be made out, Police would need to ascertain the specific facts of each case and the circumstances.
\tMr Louis Ng Kok Kwang (Nee Soon): I thank the Senior Parliamentary Secretary for the reply but I am a bit confused. She said they are generally not going to be prosecuted, if I am right to say that. So, could I just ask specifically, whether a mother who is breastfeeding her baby in the public without a cover – would that be liable to prosecution?
\tMs Sun Xueling: Breastfeeding in public places is not against the law. The Police will not intervene unless there are law and order concerns.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Breastfeeding on Public Trains and Buses","subTitle":null,"sectionType":"OA","content":"3 Mr Louis Ng Kok Kwang asked the Minister for Transport whether mothers are allowed to breastfeed their children onboard public trains and buses.
\tThe Senior Parliamentary Secretary to the Minister for Transport (Mr Baey Yam Keng) (for the Minister for Transport): Mr Speaker, Sir, breastfeeding is not prohibited on our public buses and trains. For those who prefer privacy while breastfeeding, we provide nursing rooms at key transport nodes and will continue to build more.
\tMr Speaker: Mr Louis Ng.
\tMr Louis Ng Kok Kwang (Nee Soon): Thank you, Sir, and this is the last question on breastfeeding. I thank the Senior Parliamentary Secretary for saying that it is not prohibited on our trains and buses. But as I shared with him, the SMRT website still says this today to an FAQ, \"Can I breastfeed or feed my children?\" And the reply is, \"For the comfort of other passengers, it is best to feed your children before entering our stations.\" So, if it is not prohibited, then, could we not send the message to say that it is best not to do it?
\tMr Baey Yam Keng: Mr Speaker, Sir, as in my reply, there is no prohibition. Mothers are allowed to breastfeed their babies and children on buses and trains. We will advise the PTOs to be clearer in their websites or FAQs so that mothers are not deterred from doing so.
\tMr Louis Ng Kok Kwang: One last supplementary question. Can I also just confirm that they are allowed to breastfeed their babies without a cover on?
\tMr Baey Yam Keng: Sir, there is no regulation for mothers to be covered up while nursing their babies on trains and buses.
\tMr Speaker: Order. End of Question Time.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Economic Expansion Incentives (Relief from Income Tax) (Amendment) Bill","subTitle":null,"sectionType":"BP","content":"[(proc text) Order for Second Reading read. (proc text)]
The Senior Minister of State for Trade and Industry (Mr Chee Hong Tat) (for the Minister for Trade and Industry): Mr Speaker, on behalf of the Minister for Trade and Industry, I beg to move, \"That the Bill be now read a Second time.\"
Sir, the Economic Expansion Incentives (Relief from Income Tax) (Amendment) Bill 2020 puts into legal effect amendments arising from the regular review of our tax incentives, as well as a change introduced in Budget 2018. Let me elaborate on the three key legislative changes contained in the Bill.
The first change relates to the transfer of awards between companies. The Pioneer Industry award and Pioneer Service award are granted to companies to encourage them to locate “pioneering” products or activities that introduce advanced technology, skills or know-how to Singapore. Meanwhile, the Development and Expansion award encourages companies to grow capabilities and conduct new or expanded activities in Singapore.
As companies amalgamate, merge or undergo corporate restructuring, there may be a need to transfer their existing awards to the new entity. Clause 4 of this Bill introduces a new Part IV to the Act for the transfer of the Pioneer Industry award, Pioneer Service award and Development and Expansion award between companies. Under this framework, such award granted to the transferee will be treated as a continuation of the award granted to the transferor.
The second change extends the Investment Allowance scheme, or IA for short, to corporate partnerships. A corporate partnership refers to a partnership, limited liability partnership or limited partnership comprising solely of partners that are companies.
The\tIA\tscheme\tencourages\tcompanies\tto\tcarry\tout projects with economic, technical or other merits, by providing an allowance granted at a specified percentage of qualifying fixed capital expenditure incurred on an approved project. However, the IA currently can only be awarded to a company, but not a corporate partnership.
We know that companies increasingly co-own assets with other companies, including through corporate partnerships. There are sound business reasons for having these partnership arrangements, such as co-sharing of equipment to reduce expenses and to optimise usage.
To better cater to the evolving business environment, clauses 6 and 7 of the Bill amend section 66 and introduce a new section 66A of the Act, respectively. This is to extend the IA scheme to include corporate partnerships. Details to enable implementation will be prescribed in subsidiary legislation.
Lastly, to encourage companies to invest in submarine cable systems landing in Singapore, the Minister for Finance announced in Budget 2018 that the IA for productive equipment would be extended to include capital expenditure incurred on newly-constructed submarine cable systems landing in Singapore approved by the Minister. This will help strengthen Singapore’s position as a leading digital connectivity node.
Clauses 6 and 8 of the Bill amend sections 66 and 67 of the Act, respectively, to give legislative effect to this inclusion. Mr Speaker, I beg to move.
[(proc text) Question proposed. (proc text)]
Ms Anthea Ong (Nominated Member): Mr Speaker, since our Independence, the Economic Expansion Incentives Act or EEIA has helped to incentivise the investments and innovation that brought us good jobs and economic prosperity.
However, we are entering a new era of increasing volatility and disruption. We are in the throes of the COVID-19 pandemic as we speak but I fear the climate crisis will unleash chaos and food supply disruptions that dwarf what we have seen. Yet there exists enormous growth opportunities for technologies that the world needs to exit the climate crisis and enter a world of peace and stability.
Is the EEIA able to attract the kind of investments and innovation that will allow Singapore to demonstrate climate leadership and ride on the low-carbon wave? There are two parts to this question that I hope the Minister can address.
EEIA provides tax relief for pioneering economic activities as well as a wide range of capital investments. My first point, Mr Speaker, relates to whether the EEIA extends incentives to high-carbon activities so that the tax relief may end up as a subsidy to the fossil fuel industry.
Senior Minister Teo Chee Hean recently announced Singapore's goal of achieving net zero emissions \"as soon as viable in the second half of the century\". Senior Minister Teo himself admitted that this goal is \"very challenging\". Yet even this goal falls short of the target of net zero by 2050 that IPCC estimates would limit warming to 1.5 degrees Celsius and avert the worst impacts of climate change.
To have even the slightest hope of meeting this target, we have to stop incentivising investments that will lock in decades of high carbon emissions.
Prime Minister Lee Hsien Loong in his National Day Rally last year announced we would probably need $100 billion to protect ourselves against rising sea levels. This year’s Budget has already allocated $5 billion to the Coastal and Flood Protection Fund. It would be unthinkable if we gave out tax relief to the same activities that will force us to spend more on coastal and flood protection. I would imagine this would give Deputy Prime Minister Heng a bit of a headache trying to balance the Budget.
Could the Minister clarify whether the qualifying criteria for tax relief under the EEIA considers the long-term impacts on Singapore? In particular, is there consideration for whether the activity would lead to an increase in carbon emissions?
EDB has published its assessment criteria for pioneer certificate incentives under the EEIA, which includes employment created and spin-off to the economy. For high-carbon sectors, even such economic benefits are not assured. In 2015, when oil prices fell below US$50 per barrel, the oil and gas sector cut an estimated 15,000 jobs. With oil prices bottoming out again this year, ExxonMobil has said it will make significant cuts to spending.
As climate action accelerates across the world, demand for fossil fuel products may reduce sharply. For example, with countries around the world, including Singapore, moving towards full electrification of their land transport system, demand for diesel and petrol is expected to drop. Researchers from Columbia University forecasted that passenger vehicle oil demand would decline beyond 2025. For the lowest low-carbon scenario in their 2019 study, oil demand in this sector would decline from about 25 million barrels per day today to 10 million barrels per day in 2040.
Investments in fossil fuel assets which underestimate the downside risk of disruptions from low-carbon technology, energy efficiency and climate policy could lead to stranded assets. A study published in 2018 estimated that globally, US$12 trillion of fossil fuel assets might be stranded by 2035.
Could the Minister clarify whether the economic benefits under the assessment criteria for EEIA tax relief includes consideration for the downside risk from future disruptions, such as decarbonisation?
On the other hand, the global transition to low-carbon opens up a host of new opportunities. My second point, Mr Speaker, therefore relates to incentives for innovations and investments that are aligned with a carbon-neutral economy. Section 67 of the EEIA currently lists activities eligible for investment allowances. These include reducing consumption of water and improving energy efficiency. Unfortunately, this leaves out a wide range of capital expenditure investments that contribute to Singapore's long-term sustainability, such as renewable energy, active mobility, as well as waste reduction.
While there are grants available for some of these activities, such as the 3R fund for waste recycling and reduction, this should not preclude the option to use investment allowances as an additional incentive.
Could the Minister clarify whether the list of activities eligible for investment allowances can include a category for capital expenditure that reduce greenhouse gas emissions either directly or indirectly?
For pioneering economic activities, aligning our tax incentives with a carbon-neutral economy would help us get a foothold into a host of emerging industries that support a climate-friendly future. These industries include carbon capture and storage, renewable energy, circular manufacturing, bio-plastics, energy storage, electric vehicles, alternative meat, climate-resilient agriculture and green building technology. A 2018 report by the Global Commission on the Economy and Climate estimated that over 65 million new low-carbon jobs could be generated globally in 2030.
Clean energy alone is expected to generate 2.2 million jobs in ASEAN. We are building one of the world's largest floating solar farms in Tengah Reservoir. The expertise we develop would position Singapore as a key exporter of this technology. An undersea cable to transmit solar power from Australia could also be in the pipeline.
The alternative meat market is expected to grow to US$470 billion by 2040, equivalent to a 17 times expansion in the next 20 years. Alternative meat start-ups Beyond Meat and Impossible Foods have already taken the world by storm. I am proud to see local start-up Shiok Meats entering the arena. I urge the Minister to align our tax incentives with a carbon-neutral economy, so that we can attract and grow more of such champions.
Could the Minister share whether the qualifying criteria for tax relief under the EEIA can include consideration for the potential of the activity to reduce greenhouse gas emissions either directly or indirectly?
Mr Speaker, the COVID-19 pandemic has highlighted the importance of having foresight and courage to prepare now for the possible crises of tomorrow. A recent headline in TODAY read: \"Singapore has been buttressing its food security for decades. Now, people realise why\".
Indeed, it was because of decades of effort to diversify our food sources that allowed Minister Chan Chun Sing to welcome the 300,000 airflown eggs to Singapore from Thailand when the risk arose that supply of eggs from Malaysia could be affected by the overnight lockdown.
In that same spirit, let us have the foresight and courage to prepare our economy for the risks and opportunities that emerge from a carbon-constrained future. Every tool in our policy toolbox needs to be on the table. I look forward to the Minister's response to my clarifications above. I support the Bill.
Mr Speaker: Senior Minister of State Chee Hong Tat.
Mr Chee Hong Tat: Mr Speaker, I would like to thank Ms Anthea Ong for her support for the Bill. Sir, Ms Anthea Ong asked whether the Government takes into account the carbon emissions of economic activities that we incentivise and whether the EEIA could incentivise activities that reduce Singapore's greenhouse gas emissions.
The short answer to both questions is yes.
Singapore's strategies to reduce carbon emissions are formulated at the national level through the inter-Ministerial committee on climate change, which has been formed since 2007. And these in turn shape how we work with our companies and industries, both existing and new, to make the necessary adjustments to prepare for a carbon-constrained future.
When assessing applications for incentives, including those under the EEIA, we will give priority to investments that are aligned to our national objectives. Carbon emissions is an important consideration, but it is not the only criterion. We will also evaluate if the investment contributes to Singapore's economy, advances our capabilities, and creates good jobs for Singaporeans.
In the area of the petrochemical industry, for example, this is an important sector for Singapore, in terms of both direct and indirect contributions to the economy, to jobs and to livelihoods.
But what we will do is we will work with the industry players to make sure that what we have in Singapore are best-in-class, because we do not just produce to meet Singapore's domestic needs. Our petrochemical industry actually serves the whole world, consumers in different parts of the world. So, we will work with them and implement measures that will meet best-in-class standards for this industry.
Sir, Ms Anthea Ong also spoke about coastal protection, and indeed, this is something that we take very seriously. Singapore take our climate change commitments seriously because we know we need to do our part. We want to be a responsible stakeholder. And hopefully this will also set a good example for other countries to do likewise.
I say this because climate change requires global action. Singapore's actions alone will not be adequate. If the other countries do not follow suit, we will not be able to tackle this global challenge together.
So, when we invest in protecting our shorelines, this is something that we are investing to protect both the current and future generations of Singaporeans. But in order for sea levels not to rise significantly, it is going to go beyond what Singapore can do alone. And this is why we hope that the world can work together, to be able to find solutions and tackle climate change together.
[(proc text) Question put, and agreed to. (proc text)]
[(proc text) Bill accordingly read a Second time and committed to a Committee of the whole House. (proc text)]
[(proc text) The House immediately resolved itself into a Committee on the Bill. – [Mr Chee Hong Tat]. (proc text)]
[(proc text) Bill considered in Committee; reported without amendment; read a Third time and passed. (proc text)]
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Goods and Services Tax Voucher Fund (Amendment) Bill ","subTitle":null,"sectionType":"BP","content":"[(proc text) Order for Second Reading read. (proc text)]
The Second Minister for Finance (Mr Lawrence Wong): Mr Speaker, I beg to move, \"That the Bill be now read a Second time.\"
The Government established the Goods and Services Tax Voucher Fund under the GST Voucher Fund Act in 2012. The main purpose of the Fund is to provide financial assistance to the less well-off, to offset part of their GST expenses. Since 2012, the existing GST Voucher scheme has been funded from the GST Voucher Fund. Under this scheme, lower and middle income households receive annual cash payouts, MediSave top-ups, and utilities rebates, or \"U-Save\" to offset the GST that they pay on their daily expenses.
In his Budget 2020 Speech, Deputy Prime Minister Heng Swee Keat announced that the Government will introduce an Assurance Package for GST. The Assurance Package will help Singaporeans cushion the impact of the GST rate increase to 9%. Deputy Prime Minister Heng Swee Keat has explained why this is necessary to raise recurrent revenues to meet recurrent spending, particularly for healthcare.
Mr Speaker, let me now highlight the main features of this Bill.
Amendments to Part 2 of the Act expands the purpose of the GST Voucher Fund, such that the beneficiaries are no longer confined to those who are less well-off. With this amendment, the GST Voucher Fund can then be used to fund the Assurance Package for GST, which will benefit all Singaporeans during the transition period. Having said that, the weight of our assistance in the GST Voucher Fund will still go toward lower income Singaporeans who will continue to receive more support.
The amendments will also allow assistance to be provided in the form of grants-in-aid, to defray the expenses incurred by parents or guardians for infants and children under their care and charge. Given the expanded purposes of the Fund, we have also added a new section 8A to safeguard against legal action being inappropriately taken against the GST Voucher Fund, which basically is for general welfare.
In conclusion, Mr Speaker, the Bill broadens the group of beneficiaries who can receive financial support funded by the GST Voucher Fund and the possible forms of support. The Government will then be able to use the GST Voucher Fund for measures in the transitional package to cushion the GST increase for all Singaporeans, when the GST increase takes effect.
I want to reiterate that while we are broadening the assistance under the Assurance Package, we will continue to provide more support to lower income Singaporeans during the transition, and over and above this, we will continue to enhance the existing permanent GST Voucher scheme, to provide continued support to lower and middle income households. Mr Speaker, I beg to move.
[(proc text) Question proposed. (proc text)]
Ms Joan Pereira (Tanjong Pagar): Mr Speaker, Sir, I welcome the amendments to the Goods and Services Tax Voucher Fund Bill. Compared to the current provision which targets the identified beneficiaries themselves, the grants-in-aid extend the reach of the Fund to help with the expenses that may be incurred by one person for the benefit of another beneficiary, such as by a family member of an elderly. My residents, especially those who are care-givers of their elderly parents welcome this move.
Presently, the Home Caregiving Grant provides $200 monthly cash payouts to care-givers to defray care-giving expenses, such as to be used to partially offset the wages of a foreign domestic worker (FDW) or eldercare fees.
The grants-in-aid will be a much-welcomed supplement as there are quite a number of care-giving expenses, including assistive devices and consumable home healthcare items. While the Seniors' Mobility and Enabling Fund provides subsidies to help cover some of these costs, financial assistance to offset the impact of GST on these items will provide added relief.
I would like to request the Ministry to consider taking a step further to exempt a list of vital items used by the elderly from GST altogether, that would include assistive devices like wheelchairs, walking sticks and hearing aids as well as home healthcare items, that would include nasal tubing, adult diapers and milk supplements. Sir, in Mandarin.
(In Mandarin): [Please refer to Vernacular Speech.] The grant-in-aid will be a much-welcomed supplement as there are a number of care-giving expenses, including those assistive devices and consumable home healthcare items. While the Seniors' Mobility and Enabling Fund provides subsidies to help some of these costs, financial assistance to offset the impact of GST on these items will provide added relief.
I would like to request the Ministry to consider taking a step further to exempt a list of vital items used by the elderly from GST altogether, that would include assistive devices like wheelchairs, walking sticks and hearing aids as well as home healthcare items, that would include nasal tubing, adult diapers and milk supplements.
(In English): Sir, I support the Bill.
Assoc Prof Walter Theseira (Nominated Member): Mr Speaker, the Goods and Services Tax has been the subject of much misunderstanding. While the tax itself is straightforward, the policy of using GST Vouchers to correct the impact of the tax on low-income Singaporeans is perhaps less clear at times.
Before I discuss today's proposed amendment to the GST Voucher Fund, I think it useful to outline why the GST Voucher Scheme is crucial to address persistent criticisms of the GST.
Many critics argue that the GST is a regressive tax, that it places a greater burden on lower income Singaporeans and this leads to suggestions that the GST should be waived on necessities, replaced with a tax on luxury goods, or replaced by more progressive income taxes.
These ideas while well-meaning are likely to be inefficient, compared to our practice of simply granting GST Vouchers to households. For example, differentiating between necessities and luxury goods is not straightforward. A number of US states exempt groceries from sales tax, but not take-away food. This can lead to the perverse result that lobsters are exempt from sales tax but fast food is fully taxed. So simply returning the GST paid to lower income households through GST Vouchers is much easier.
Progressive income taxes should be an integral component of any fair taxation system but some critics also present a false choice between raising income taxes and GST. Income taxes do not cover short-term visitors to Singapore but GST does. Our present income tax system does not cover most sources of non-wage income to individuals, so GST does help to ensure people pay some taxes out of capital income, windfalls, capital gains, and so on.
There are reasonable concerns, for example, Ms Pereira raised that retirees are burdened by paying GST. But again, returning the GST paid to low-income retirees through GST Vouchers is much easier, while high-income retirees undoubtedly benefit overall from the lack of capital taxes in Singapore.
The permanent GST Voucher Scheme, backed by the GST Voucher Fund, is an ideal solution to the problem of regressivity. If it is well designed, it can eliminate most or all of the burden of GST on low-income Singaporeans.
The concern I have with this amendment is that in broadening the purposes of the GST Voucher Fund to \"mitigate the impact of the goods and services tax\", we are moving away from the original intent that the GST Voucher Fund is meant to directly finance \"relief from goods and services tax\" to low-income Singaporeans.
As GST increases the cash price of purchasing goods and services, it is simplest if cash is just returned to lower income households, so that they end up paying little or no net GST. Simplicity is also a virtue when it comes to addressing misunderstandings about the GST. It is a lot easier to point to the cash value of the GST Voucher payouts, and then compare that to the GST paid by individuals, rather than to count up the value of other subsidies.
I wish to ask the Minister whether the Government continues to have the policy intent of using the GST Voucher Fund, as far as possible, to provide cash and cash-equivalent relief from GST to lower income households. If that is the case, then would it be really necessary to move this particular part of the amendment? Could then the other relief schemes be funded through other means?
I would also suggest that the Government annually assess and publish estimates of the amount of GST paid by individuals and households at different parts of the income distribution. These could then be compared to the value of GST Voucher payouts, so the actual incidence of the GST on Singaporeans will be transparent. This would also be useful for fine-tuning aspects of the GST Voucher Scheme because changes to savings and expenditure patterns in the population could affect the GST incidence people pay.
The Minister for Finance has revealed in this year’s Budget debate that the bottom 40% only pay for 10% of net GST. The top 20% and foreigners pay for 60% of net GST. But I still think it would be more useful and illuminating if the Ministry could publish estimates on the effective rates of GST at different parts of the income distribution and how this will be impacted by the proposed increases to the GST rate, with the GST Voucher Scheme in mind.
Ms Anthea Ong (Nominated Member): Mr Speaker, thank you for the opportunity to speak on this Bill which seeks to expand the Goods and Services Tax Voucher Fund’s beneficiaries as the Government plans to cushion the impact of the GST hike for nearly every household in Singapore, whether they are in need of relief or not.
The Government recognises that GST is a regressive tax. It hits low earners the hardest. The GSTV Fund was established to help lower income Singaporeans cope with their GST expenses, mitigating GST’s regressive nature. It is an ingenious institution. But I have two questions.
First, why is the policy limited only to Singaporeans when GST hurts all lower income residents?
Second, why expand the scope of beneficiaries to those who do not need the relief when there are people in our midst who need it but do not get it?
Mr Speaker, our migrant worker population is one of the most vulnerable in Singapore. They will suffer from the GST hike and are being offered no relief. It seems counter-intuitive to give money to individuals who do not need the relief while denying those who do. In fact, when we consider migrant workers' centrality to the building of our nation, it seems almost perverse.
Singapore relies on an enormous foreign workforce to sustain the construction, marine, manufacturing and domestic work sectors. As of June 2019, there were 1.4 million foreign workers in Singapore. Seventy percent of them were work permit holders. That is about 17% of the population and 26% of our resident labour force. They most commonly come from India, China, Bangladesh, Indonesia and the Philippines. Low-wage migrant workers are most commonly employed in construction, shipyards, sanitation services, manufacturing, and domestic work. These industries touch the everyday lives of every Singaporean in one way or another including making sure our facilities and surroundings are properly cleaned and disinfected during this COVID-19 crisis.
Our progress these last two decades would not have been possible without their labour. The Marina Bay skyline, Gardens by the Bay, the Jewel and many more would not exist without our foreign workforce. The Building and Construction Authority or BCA reported that net operating surplus for the Construction sector alone grew by a Compounded Annual Growth Rate (CAGR) of 9.3% per annum, in nominal terms, between 2005 and 2017. I think it is fair to deduce that the economic contributions of our migrant workers are more than significant.
The same can be said of our foreign domestic workers or FDWs. According to a 2019 regional study, FDWs contributed S$11.1 billion to the economy in 2018, or 2.4% of Singapore’s GDP. This contribution is a combination of the FDWs’ direct personal expenditure and indirectly from the real value of \"paid\" domestic work and value of freed-up time. For example, freeing mothers to participate in the labour force added S$3.5 billion to the Singapore economy. This includes savings of S$675 in monthly childcare costs per Singapore household.
Despite these significant contributions, our migrant workers often go unrecognised when we celebrate key milestones of Singapore’s development, be it SG50 or Bicentennial bonuses that were distributed.
Mr Speaker, our migrant workers need relief from the upcoming GST hike. The financial pressures on them are immense. Let me highlight three main factors.
The first is low, stagnant wages.
The second is debt and remittances. The workers are fettered to extortionate recruitment debt and most of their remaining wages go to supporting their families in their home countries.
And the third is expenses arising from inadequate legal protection. Many workers spend their earnings on food because their employers are not obligated to provide them with food, or fail to meet their obligations.
First, the wage factor. MOM reported that the median monthly salary from 2005 to 2019 of work permit holders, excluding foreign domestic workers, increased by 2.2% per annum, in nominal terms. A 2017 TWC2 survey of 910 work permit holders employed in non-domestic sectors showed that basic salaries for first-time workers from India and Bangladesh have flat-lined since 2006 – averaging under S$600 per month. When adjusted for inflation, average basic salaries for first-time construction workers seem to have declined by about 20% since 2006. The same survey found foreign domestic workers earned an average of $597 a month in 2016.
TWC2 informs me that Bangladeshi workers were typically paid a basic rate of $18 a day in 2004, and that rate remains unchanged to this day. This was largely consistent with HealthServe’s and HOME’s casework observations of Bangladeshi migrant workers, wherein $16 to $18 daily basic remains normal. One worker was paid a daily basic rate of $13. For another, his monthly salary was $158, as declared by the employer.
To understand the extent of the stress such low wages exert on our migrant workers, we must understand where their income goes. This brings me to the second factor which is that a large chunk of their salary goes towards paying their recruitment debt.
A 2014 study reported that Bangladeshi workers earn the lowest salaries – between $350 and $800 – and yet they could pay up to $15,000 in recruitment fees which are 26 to 51 times their monthly wage that leaves them in crippling debt. They take an average of 16.5 months to repay those fees. According to HOME, the entire salary of foreign domestic workers goes towards paying their recruitment fees for the first four to eight months.
Aside from debt-servicing, HealthServe informed me that the non-domestic migrant workers they serve would remit at least half of their income back home, even up to 80%. HOME also shared that the average foreign domestic worker remits about 80 to 90 percent of her salary. When a migrant worker is unpaid, underpaid, or injured, one of their major worries is how to send money back to their families.
Last but not least, after paying off a portion of their recruitment debt and remitting monies home, migrant workers must also pay for their own food, phone and transport bills out of whatever remains of their low wages.
Employers of non-domestic migrant workers are not required to bear the cost of food for their employees. As a result, a significant amount of migrant workers’ earnings go towards a basic necessity: food. I am given to understand that many dormitory dwellers do not have a say in the type of food catered, even though they have to pay for it. Many have experienced food that they feel is of poor quality and inadequate for their nutritional needs, confirmed in a 2015 survey by NUS and HealthServe of 500 Bangladeshi workers – 80.6% indicated \"the food I get from the caterer is of poor quality\".
Foreign domestic workers spend on food, too. Employers are required by law to ensure they have adequate food. Yet, insufficient or poor quality food remains a top complaint among cases seen at the various migrant support centres. In one case that I know of, the helper was given a pack of rice containing weevils to cook and eat from! If food provided to the workers cannot sustain the physical demands of their labour, we should not be surprised that our migrant workers have to purchase their own food.
Yet, like all lower income groups, migrant workers suffer from rising food prices in Singapore. Overall, price of food has increased approximately 7% faster than inflation over the past 10 years. Certain food essentials have become at least 60% more expensive.
Mr Speaker, as much as I am also deeply concerned about the low-income households in Singapore, the benefit of GST and public transport vouchers along with other social schemes, such as ComCare, are at least in place to hopefully cushion the impact of inflation and GST.
Our migrant workers have no such help. Given their low wages, high debts and rising expenses, coupled with the high-risk nature of their jobs, they worry every day whether they will be able to provide for themselves and their families. Their circumstances leave them vulnerable and deeply stressed on a daily basis – even more so in a crisis like COVID-19. Financial support for migrant workers will go a long way in helping them manage their overwhelming financial and mental health challenges. Will the Minister consider distributing GST Vouchers to migrant workers as well as reviewing social support schemes for them?
Mr Speaker, I do not think any of us can deny that migrant workers are Singapore's great enabler. Without migrant workers, our buildings would not be built, our estates would not be cleaned and our women would not be able to go out and work. Our economy blossomed on the backs of these foreign men and women. We cannot talk about #SGTogether or #SGUnited if we do not include and care for these 1.4 million men and women in the most tangible ways.
This Bill is an opportunity for us to ask ourselves the kind of society we want to be. This COVID-19 crisis is also an opportunity for us to dip into our common humanity and ask what is Singapore in Singapore Together? Surely, before we extend financial assistance to individuals who do not need the relief, we should extend it to those who do in our midst?
Mr Speaker: Mr Lawrence Wong.
Mr Lawrence Wong: Mr Speaker, I thank the Members, Ms Anthea Ong, Ms Joan Pereira and Assoc Prof Walter Theseira for their comments on the Bill. All three Members have spoken on different aspects of the Bill and I will seek to address their comments and feedback.
Let me, first, reiterate our position. First, we have a standing commitment to provide more help to lower income Singaporeans for their GST expenses on a regular basis, that is, through the existing GST Voucher scheme. On top of that, we plan to support all Singaporeans during the transition to a higher GST rate through the Assurance Package for GST. So, there are two different aspects. One is permanent baseline; another is transitionary, in order to cushion the impact of the increase of the GST rate.
Earlier, I had already explained the reasons for the amendment, which is to broaden the purposes of the GST Voucher Fund, in order to enable the Assurance Package to be implemented to cushion the impact of the GST rate increase. I also emphasised that we will continue to provide more support to lower income Singaporeans through the existing permanent GST Voucher scheme. So, the policy intent of ensuring that lower income Singaporeans get more support remains unchanged and Assoc Prof Walter Theseira can be assured that we are not moving away from this.
In his Budget 2020 Statement, Deputy Prime Minister Heng, in fact, reiterated our public commitment for this permanent GST Voucher scheme. He said that it would fully offset the GST for the lower half of retiree households. It would significantly offset the GST for the upper half of retiree households and it would offset about half of the GST for lower income households with no elderly persons. So, that is our commitment. When the GST rate is increased, we will enhance the permanent GST Voucher scheme to continue to meet this commitment. And as part of the review to work out the likely enhancements, we will carefully study the impact of the increased GST and the GST Voucher on Singaporeans, as Assoc Prof Theseira has suggested.
In Budget 2020, we also made clear the Government's commitment to cushion the increase for Singaporeans as we transition to the higher GST rate. As our fiscal resources are limited, we will have to put Singaporeans first when we think about how to allocate these resources. We will have to prioritise support for our citizens. This reflects the responsibilities and privileges of citizenship and also acknowledges our citizens' commitment to Singapore.
Ms Anthea Ong shared her concern for migrant workers who reside in Singapore. I understand her concerns. These are workers here for employment. Like all foreign work pass holders, they will have to pay the increased GST rate from the onset, compared to Singaporeans, who will effectively see a delay in the GST increase for at least five years after offsets.
We do appreciate the contributions of migrant workers to our economy. Many of them seek employment here to give their families back home a better life. While they have to pay GST, they also benefit from job opportunities here. Rather than extend GST Vouchers to this group, we will have to look at other ways where we can address more directly the concerns and needs that migrant workers have, bearing in mind that there are also many organisations out there that play an important role in looking out for the well-being of migrant workers and ensuring that they are treated fairly and have good working conditions. So, these organisations continue to do good work and the Government will see how we can continue to work with these organisations to look out for the well-being of our migrant workers.
Ms Joan Pereira asked whether we could consider exempting GST for a list of vital healthcare items and assistive devices used by the elderly. I will address this briefly as it does not really directly relate to the Bill. We have a broad-based GST system with minimal exemptions and we have chosen this approach so as to keep the GST rate relatively low while we provide targeted assistance to the lower income and the elderly through subsidies and grants. In fact, Assoc Prof Theseira has helped to explain why we think this is a better approach and meets the objective of helping those who need help.
Today, we already absorb GST for all subsidised patients for medical services and medications in polyclinics, public hospitals or intermediate and long-term care and we will continue to do so with the GST increase.Seniors currently receive more benefits under the GST Voucher scheme through annual MediSave top-ups. Seniors also receive significant support for their healthcare costs through other subsidies. Seniors who need assistive devices and home care consumables can tap on the Seniors' Mobility and Enabling Fund and the Home Caregiving Grant which Ms Pereira has also highlighted. Additional help, such as through ComCare and MediFund, would be made available to those who require further financial assistance. Of course, seniors can also approach the agency for integrated care, for advice on the available support.
Mr Speaker, I thank the Members for their comments on the Bill and I believe I have addressed the comments. I beg to move.
[(proc text) Question put, and agreed to. (proc text)]
[(proc text) Bill accordingly read a Second time and committed to a Committee of the whole House. (proc text)]
[(proc text) The House immediately resolved itself into a Committee on the Bill. – [Mr Lawrence Wong]. (proc text)]
[(proc text) Bill considered in Committee; reported without amendment; read a Third time and passed. (proc text)]
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Supplementary Supply (FY 2020) Bill","subTitle":null,"sectionType":"BI","content":"[(proc text) \"to make supplementary provision to meet additional expenditure for the financial year 1 April 2020 to 31 March 2021\", (proc text)]
[(proc text) President's recommendation signified: presented by the Second Minister for Finance (Ms Indranee Rajah); read the First time; to be read a Second time after the conclusion of proceedings on the Supplementary Estimates of Expenditure for FY2020/21. (proc text)]
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Estate Agents (Amendment) Bill","subTitle":null,"sectionType":"BI","content":"[(proc text) \"to amend the Estate Agents Act (Chapter 95A of the 2011 Revised Edition)\", (proc text)]
[(proc text) presented by the Minister of State for National Development (Mr Zaqy Mohamad) on behalf of the Minister for National Development; read the First time; to be read a Second time on the next available Sitting of Parliament, and to be printed. (proc text)]
Mr Speaker: Order. I propose to take a long break now. I suspend the Sitting and will take the Chair at 3.20 pm.
Sitting accordingly suspended
at 2.27 pm until 3.20 pm.
The Leader of the House (Ms Grace Fu Hai Yien): Mr Speaker, I understand that a Message from the President addressed to Parliament is to be read to the House. As the Message is on a matter related to Deputy Prime Minister's Ministerial Statement, I seek the House’s agreement for the Message to be taken now.
Mr Speaker, I beg to move, \"That, under Standing Order 10(2), the Message from the President be taken now.\"
[(proc text) Question put, and agreed to. (proc text)]
[(proc text) Resolved, \"That, under Standing Order 10(2), the Message from the President be taken now.\" – [Ms Grace Fu Hai Yien]. (proc text)]
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Message from the President","subTitle":"Announcement by Mr Speaker","sectionType":"OS","content":"Mr Speaker: Order. I wish to inform hon Members that I have on 25 March 2020 received a Message from the President addressed to Members of Parliament. I will read the Message to hon Members.
\"Mr Speaker. Hon Members. This is my first message to Parliament as custodian of the Government's past reserves. Shortly after this message, Deputy Prime Minister Heng Swee Keat will be announcing the Government's proposed measures under the second assistance package in response to the COVID-19 pandemic. The package, which is before this House for debate, is a substantial one. The Government has tabled a Supplementary Supply Bill to support the package, which is likely to result in a draw on past reserves, and I have given my in-principle support for the draw.
Since we established the reserves protection framework in 1991, we have had to draw on past reserves just once, during the Global Financial Crisis in 2009, when we used them to fund part of the Resilience Package. Then-President S R Nathan approved a draw of $4.9 billion to fund two temporary and extraordinary measures. Apart from helping to avert an even sharper downturn and prevent a permanent damage to our economy, that draw was an instructive one on how we could operationalise the reserves protection framework. During that period, the Government also sought the President’s concurrence to use $150 billion of past reserves to back the Deposit Guarantee Scheme. The guarantee was not triggered, and there was no draw on past reserves.
But every situation is unique. Our current crisis is unparalleled in modern history. Governments around the world have had to think hard and make unprecedented moves over the past few weeks, such as locking down an entire country.
Similarly, my in-principle support for the Government’s present proposal was given after careful deliberations, considering the grave circumstances and highly uncertain outlook. I have therefore agreed with the Prime Minister that I should send this message to Parliament to state my views on the Government’s proposed draw on its past reserves. In particular, I want to share my considerations on whether the proposed draw is necessary, whether the measures will be effective and whether the process by which the Government has engaged me was a reasonable one. However, let me be clear upfront: my message is not meant to influence the Parliamentary discussion that follows. I urge hon Members of this House to debate the package rigorously and help sharpen the proposed measures, because ultimately we are all trying our best for Singapore and Singaporeans.
Under the Constitution, my custodial duty as the President is clear – I have the responsibility and discretion to withhold my assent to budgets and expenditures that are likely to lead to a drawing on past reserves. The question is, are we now faced with such exceptional circumstances that I should allow the draw on past reserves?
We ended 2019 on a cautiously optimistic note. It seemed then that the global economy was finally poised for recovery following a year of subdued growth caused by US-China trade tensions.
The COVID-19 outbreak totally changed that outlook. By mid-February, the situation was already rather gloomy. MTI had already had to downgrade the GDP forecast by one full percentage-point at that time. When the Government came to brief me about Budget 2020, we discussed the option of drawing on past reserves if the situation worsens, but did not do it immediately as current reserves were still sufficient for the scale of the package envisaged then.
However, since then, we have had successive waves of bad news. Just when the COVID-19 situation in China seemed to be stabilising, a new wave of cases started in the rest of the world. Europe has become a new epicentre. Cases in the US are growing quickly too. WHO has declared the outbreak as a pandemic. The drastic measures taken by countries to protect borders and lock down societies have had serious repercussions. Already overdue for a market correction, share markets worldwide have fallen sharply. We are faced with a double whammy of a worldwide public health emergency and a deepening economic crisis. This downturn is likely to be deeper and last longer than SARS and the 2009 Global Financial Crisis.
This economic shock is totally different from an ordinary business cycle downturn. From talking to Singaporeans and unions, it is clear to me that companies and workers are suffering badly. For example, the hotel occupancy rate is only 20% currently. Many airlines, including SIA, have grounded almost all their planes due to massive flight cancellations. Many self-employed workers in the gig economy are not getting jobs. Production lines in factories are stalling due to supply chain disruptions, exacerbating their already tight cash-flow situation.
We need to do our utmost to help our businesses and people quickly. It is a matter of survival.
With the unprecedented and rapidly worsening of the global situation, the Government has assessed that we need to implement a substantial second support package swiftly to stabilise our economy, keep as many workers as possible employed and help viable enterprises to survive. Deputy Prime Minister Heng will share the details of this second package later, but based on what he has briefed me, it is a substantial one – beyond the current reserves accumulated in this term of Government.
Our reserves were built up over the years through prudent spending and were set aside precisely to cater for rainy days. The situation we are heading into looks more like a thunderstorm than a drizzle.
In this crisis, it is the Government’s responsibility to come up with relevant and impactful measures. Over the next few days, hon Members of this House will debate these measures. I urge you to debate robustly the merits of what are being proposed.
To arrive at my in-principle decision, I reviewed the Government’s proposal with my Council of Presidential Advisers (CPA). We agreed that we need to help companies with their costs and cash-flow, to keep them afloat in the meantime. This is especially so for aviation, travel and tourism, and related industries, which are especially badly hit.
We also agree that our priority should be to help workers keep their jobs.
Let me also mention that I am satisfied with the process by which the Government has proactively reached out to me and the CPA in proposing this draw on past reserves.
Already a month ago, I have discussed this possibility with the Prime Minister and Deputy Prime Minister Heng. Two weeks ago, the Prime Minister sounded me out on the need for the second assistance package, which the Government was proposing to fund from a combination of current and past reserves. Thereafter, the various agencies including MOF, AGD, MTI, MAS, MOH, MOT and MOM briefed me and the CPA, and comprehensively answered our queries.
After the briefing, the CPA deliberated on the proposal to draw on past reserves to support the package. The CPA unanimously recommended that I give my in-principle support given the circumstances, and noted that the proposed measures are temporary in nature. I have independently come to the same conclusion. I have therefore given my in-principle support for the Government’s proposal to draw on its past reserves.
The due process following this is that the Supplementary Estimates and Supplementary Supply (FY2020) Bill should first pass through this Parliament. If the Estimates and Bill pass the vote in this House, the Bill will be presented to me for the Presidential assent. At that stage, I will scrutinise it further, before giving my assent to the Bill.
Mr Speaker and hon Members, we are facing an unprecedented crisis. The closest historical precedent was the Spanish Flu in 1918. But with globalisation and more interconnected economies and people, we can expect the economic impact to be far worse this time.
COVID-19 cause deaths and suffering, so an economic cure though necessary is not sufficient. We also need a medical solution, as well as psychological and social ones.
Understandably, we are uncertain about what lies ahead of us. But we should not be fearful. We have done well as a nation. Internationally, our response to COVID-19 has been viewed as being systematic and effective. I am also glad that Singapore has banded together in fighting this disease. Singaporeans are responding calmly and responsibly. The Government has been open and transparent. And the community has stepped up to help those who may be more vulnerable. In these worst of times, I am heartened to see the best of Singaporeans.
I am confident that we will be able to get through this crisis together. It is not anybody’s wish for a crisis to befall us, but from time to time, it is inevitable. When it happens, how we respond will define us as a nation. So, let us work together as one people and support one another on this journey. Let us overcome the crisis and emerge stronger and more cohesive as a nation.\"
Ministerial Statement. Deputy Prime Minister.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Additional Support Measures in Response to COVID-19 Pandemic","subTitle":"Statement by Deputy Prime Minister and Minister for Finance","sectionType":"OS","content":"The Deputy Prime Minister and Minister for Finance (Mr Heng Swee Keat): Mr Speaker, Sir, Members of this House have heard the President's message, delivered on her behalf by the Speaker. I thank the President for giving her in-principle support for the Government’s proposal to draw on the Past Reserves. I also thank the Council of Presidential Advisers for their deliberations.
On 18 February, just five weeks ago, I started my Budget 2020 speech setting out what we must do to combat the threats posed by the COVID-19 outbreak. At that time, there were 800 confirmed cases outside of China. I said then that the Government was monitoring the situation closely, so that we can and are prepared to do more if the situation warrants it.
The outbreak has escalated quickly. Three weeks after my Budget speech, on 11 March, the World Health Organization (WHO) declared COVID-19 a pandemic, recognising the severity and risk of further global spread.
Today, the WHO estimates that the number of people infected has exceeded 410,000, across more than 190 countries.
The COVID-19 outbreak is a battle on many fronts – medical, economic and social.
First, on the medical front, countries are taking extraordinary measures to contain the spread of the virus, so their healthcare systems are not overwhelmed. Many countries have implemented lockdowns, while the US has declared a national emergency.
In Singapore, we are doing everything we can to keep you and your families safe. We acted early and decisively. As the severity of the virus outbreak grew worldwide, we stepped up our measures. These have, so far, helped to keep the number of cases at manageable levels during the first wave.
Ministers Gan Kim Yong and Lawrence Wong gave comprehensive updates on the further measures that we have put in place and gave us vivid and moving accounts in their Ministerial Statements yesterday. We thank Minister Gan and Minister Wong, and the members of the task force, for your leadership.
On behalf of all of us in the Government and in this House, let us express our deepest appreciation to our dedicated and professional healthcare workers, and all our frontline officers, for working courageously and tirelessly. Let me also commend fellow Singaporeans for your care and support for one another, and for being so civic-minded.
However, as much as we try, the Prime Minister and Senior Minister Teo have warned earlier that the COVID-19 pandemic is likely to take at least a year to be resolved, and the economic repercussions would last even longer. The world is seeing successive waves of infection and importation of infections. We must be prepared to take further tougher measures.
Yet measures on the medical front to contain the pandemic, both in Singapore and around the world, have made the second front of the battle – the economic front, even more difficult.
These public health measures have caused severe economic disruptions and uncertainties.\tAs more countries implement their measures, the economic disruptions will be wider, deeper and more prolonged.
The global economy is now facing both a supply and demand shock. On the supply side, supply chains have been disrupted as locked down workers are unable to work. With highly integrated global supply chains, a disruption in any one part of the chain or in any one country will have knock-on effects worldwide. On the demand side, aggregate demand has fallen as people stay home and curtail spending. Consumer and business confidence is plunging in the face of growing uncertainties.
Global growth forecasts for 2020 have fallen sharply compared to just a month ago. The International Monetary Fund (IMF) has downgraded its 2020 global growth forecast three times since January 2019 and flagged that a further downgrade is imminent in April. It added that it expects a recession at least as bad as during the 2008 global financial crisis.
Global financial markets are being roiled by the mounting uncertainties and cutback in economic activity. Stock markets have come down from their peak some weeks ago. The S&P 500 Index took only 22 trading days to fall by 30% from its peak, making it the fastest drop of this magnitude in history.
The key volatility indices in Europe and the US, which some call the \"fear index\", briefly reached levels last seen during the global financial crisis.
Credit has tightened across the world, and the US yield curve has fallen below 1% for the first time in history.
The disruptions around the world will significantly curtail global demand, disrupt supply chains and possibly lead to financial shocks. As an open economy that is highly integrated with the global economy, we will be deeply impacted by these global shocks.
Based on advance Gross Domestic Product (GDP) estimates released this morning, in the first quarter, the Singapore economy contracted by 10.6% quarter-on-quarter, or 2.2% year-on-year, reversing the 0.6% growth in the previous quarter. This morning, the Ministry of Trade and Industry further downgraded Singapore's GDP growth forecast for 2020 from a range of -0.5% to 1.5% announced last month to between -4.0% and -1.0%.
The outbreak has impacted broad swathes of our economy, with some more affected than others. The most badly affected sectors are our aviation and tourism sectors, as international visitor arrivals in Singapore have nearly ground to a halt. Consumer-facing sectors such as food services, retail trade and land transport have been significantly affected. The outward-oriented sectors such as manufacturing and wholesale trade have also been affected as external demand falls and supply chains get disrupted.
I have spoken on the medical and economic fronts of the battle. The third front is social and psychological.
COVID-19 is a test of our social cohesion and our psychological resilience. While people are understandably fearful, we must not surrender to this fear or panic. The Government will take all the social and economic measures we need to keep our people safe, keep our economy growing and prepare ourselves for the recovery. Now, more than ever, we need Singaporeans to be strong and ride through these challenges together.
COVID-19 is a defining challenge for us. It is a public health crisis, an economic shock and a social test. It will challenge our resilience as individuals and as a society. In such extraordinary times, it is collective acts of kindness and courage that make a people extraordinary. How Singapore manages this, and whether we emerge stronger from this, will define us as a people and nation.
My last Budget was called the Unity Budget. I have decided to call this Supplementary Budget the Resilience Budget. It reflects our determination that Singapore and Singaporeans remain resilient in the face of these challenges. Come what may, no matter how daunting the challenge at hand, we will bounce back, stronger and more united than ever, as we weather this storm together.
Mr Speaker, Sir, we are facing an unprecedented crisis of a highly complex nature. In economic terms alone, this will likely be the worst economic contraction since independence. This extraordinary situation calls for extraordinary measures.
Last month, I committed $6.4 billion in the Unity Budget towards the Stabilisation and Support Package, the Care and Support Package and to support our frontline agencies. Today, I will introduce measures worth over $48 billion in this Resilience Budget to deal decisively with the situation at hand. This is over seven times of the first tranche. Altogether, we are dedicating close to $55 billion to support our people in this battle, amounting to 11% of our GDP. This is a landmark package and a necessary response to a unique situation.
The Government has sought and obtained the President's in-principle support to draw up to $17 billion from our Past Reserves to fund part of the Resilience Budget.
The Resilience Budget focuses on three key areas. First, save jobs, support workers and protect livelihoods. Second, help enterprises overcome immediate challenges. Third, strengthen economic and social resilience so that we can emerge intact and stronger.
Before I get into the details, I thank NTUC, the Singapore Business Federation as well as many citizens and groups, who have given us valuable feedback. Your views have shaped our responses to the challenges posed by COVID-19.
Our immediate priority is to save jobs, support our workers and protect livelihoods. Over one third of the Resilience Budget is dedicated to this.
Even then, we cannot prevent an economic recession as the external health and economic situation will evolve beyond our control. But it will help us mitigate the extent of the downturn and more importantly, help save jobs and protect livelihoods.
For workers who are currently employed, our top priority is to help them stay employed.
In the Unity Budget, I introduced the Jobs Support Scheme and enhanced the Wage Credit Scheme. Both are focused on preserving and enhancing jobs. The situation now calls for bolder and more aggressive moves to save jobs and keep workers in employment.
I will significantly enhance and extend the Jobs Support Scheme to provide more impactful and sustained wage support.
For every local worker in employment, I will raise the Government's co-funding of wages from 8% to 25%. Firms in the food services sector will receive higher support at 50% of wages and firms in the aviation and tourism sectors, which are the most badly affected sectors, will be supported at 75% of wages. [Applause.]
I will raise the monthly qualifying wage ceiling from $3,600 to $4,600, which is the median wage in Singapore.
I will also extend the Jobs Support Scheme for another two quarters till the end of 2020, so employers will receive a total of three tranches of payouts in May, July and October this year.
With these enhancements, a total of $15.1 billion will be allocated to support more than 1.9 million local employees under the Jobs Support Scheme. This is more than twice the level of support provided during the global financial crisis. With this support from the Government, I urge employers to do your part to hold on to your workers. [Please refer to Annex B-1.]
The enhancements to the Jobs Support Scheme and Wage Credit Scheme will support workers employed in our enterprises.\tThe second group of individuals whom we seek to support is self-employed persons.
Over the last few weeks, I received feedback from the Labour Movement and many self-employed persons calling for stronger support for the self-employed, who have less income security and whose livelihoods may be worse affected during this period of economic uncertainty. This group has been harder to reach as they work in diverse industries, many occupations, with varying working arrangements. They include taxi and private hire car drivers, real estate agents, media and art freelancers, and sport coaches.
In the Unity Budget, we were able to support some of them.
For taxi and private hire car drivers, we partnered with NTUC, the operators and LTA to deliver help. They comprise the largest group of self-employed persons. We also introduced the Self-Employed Person Training Support Scheme to provide a training allowance of $7.50 per hour to self-employed persons attending courses under the SkillsFuture Series or select training programmes.
In this Resilience Budget, we plan to provide direct cash assistance to more self-employed persons. Some of them have less means and family support, and need help to tide over this difficult period.
I have discussed with the Minister for Manpower and NTUC Secretary-General on developing a Self-Employed Person Income Relief Scheme, or SIRS, for this period.
Eligible self-employed persons will receive $1,000 a month for nine months. Overall, we expect to reach out to most of the self-employed persons who depend on self-employment for their livelihood and have less means and family support. I will set aside $1.2 billion for this. [Applause.]
MOM will provide more details soon.
I will also provide sustained support for self-employed persons to make full use of any downtime during this period to train and upskill. I will set aside another $48 million to extend the Self-Employed Person Training Support Scheme to December 2020, and enhance the hourly training allowance from $7.50 to $10, with effect from 1 May 2020. The enhanced training allowance is on top of the already generous training subsidies, which cover up to 90% of fees. In addition, trainees will be able to tap on their SkillsFuture Credit to further offset the course fees.
Through these schemes, and with our many partners, we hope to provide a safety net for the self-employed during this outbreak.
Looking ahead, we will see how we can better support self-employed persons in strengthening their financial security. We will study this carefully.
For lower income workers, including self-employed persons, we have been supplementing their incomes through the Workfare Income Supplement Scheme (WIS).
In this Unity Budget, I announced that Singaporeans on Workfare in 2019 would receive a one-off Workfare Special Payment amounting to 20% of their 2019 payout, with a minimum payout of $100.
In this Resilience Budget, I will enhance the Workfare Special Payment and increase the payout received by this group of Workfare recipients to $3,000 each, in cash. [Applause.]
The Jobs Support Scheme, Self-Employed Person Income Relief Scheme and enhanced Workfare Special Payment will help to sustain the employment and salaries of our workers, with more financial support for workers who earn less.
Apart from employees and self-employed, I will provide more help for jobseekers to find employment. In particular, first-time jobseekers may be concerned about the current job market. These include our students who have just graduated or are graduating from ITE, Polytechnics and Universities this year.
I will introduce the SGUnited Traineeships programme to provide our young people with opportunities to gain valuable work experience, while giving an added boost for employers to emerge stronger from this crisis.
Under this programme, Workforce Singapore (WSG) will co-share manpower costs with enterprises that offer traineeships targeted at local first-time jobseekers this year.
We are looking to support up to 8,000 traineeships this year, across both large and small enterprises. This will include science and technology traineeships in our R&D labs, deep-tech startups, accelerators and incubators. MOM will announce more details soon.
I will also launch the SGUnited Jobs initiative to create about 10,000 jobs over the next one year.
The public sector will take the lead. Our agencies have been planning our manpower needs early and there is a range of jobs which we need to fill in emerging areas. We will accelerate hiring plans to fill these roles, while giving our people meaningful employment opportunities. We will recruit for long-term roles in the public service and sectoral partner institutions, in areas such as social services, early childhood education, and ICT, so that we can enhance our provision of essential services. We will also offer short-term, temporary jobs to handle the increase in COVID-19 related operations, such as health declaration assistants, temporary management support officers and the Transport Ambassadors announced by the Minister for Transport earlier this week.
At the same time, we are working with the Singapore Business Federation and Trade Associations and Chambers to identify private sector job opportunities. These may come from businesses recruiting for the eventual recovery, or with short-term manpower needs due to disruptions in labour supply. I am heartened to see that companies, such as Micron and SMRT, have already come on board the SGUnited Jobs initiative.
WSG will launch an SGUnited Jobs virtual career fair tomorrow with more than 2,200 job vacancies. This will focus on short-term temporary jobs that are immediately available. Jobseekers looking for longer term roles can consider the wider range of jobs advertised on my CareersFuture.sg. I encourage interested jobseekers to explore these.
The best way to safeguard the well-being of our people is by supporting them to stay employed. But as the impact of COVID-19 on our economy deepens, some workers will lose their jobs or see their incomes significantly reduced. We will help them.
Today, the ComCare scheme provides assistance to those who fall into financial hardships. We will exercise more flexibility when considering applications for ComCare during this period, to ensure that affected Singaporeans can get help.
Some families may require help urgently, while waiting for the new help measures to kick in. We will set up a Temporary Relief Fund in the month of April, to provide them with immediate financial assistance. This will be available at our Social Service Offices and Community Centres.
We will also introduce a COVID-19 Support Grant at our Social Service Offices from May to September this year, to help our workers who become unemployed due to COVID-19. Low- and middle income employees who lose their jobs can receive a grant of $800 per month for three months, to tide them over while they find new jobs or go for training. [Please refer to Annex B-2.]
In total, I will set aside $145 million for the new schemes and increased flexibilities to ComCare.
Many Singaporeans are concerned about how they will pay their bills and household expenses if their livelihoods are affected during this uncertain period. We will put more cash in the hands of all families to help them cope.
First, I will enhance the Care and Support Package announced in the Unity Budget. [Please refer to Annex B-3.]
I will triple the cash payout for all adult Singaporeans from the earlier announced range of $100 to $300, to a range of $300 to $900, depending on income. [Applause.] I will provide additional help for families with young children. I will triple the additional cash payout given to each Singaporean parent with at least one young Singaporean child, from $100 to $300.
For lower-wage workers, the enhanced Workfare Special Payment I mentioned earlier will provide them $3,000 in cash this year for their household needs.
To further help needy Singaporeans with their daily expenses, and in particular, the cost of food, I will triple the Grocery Vouchers given to them this year from $100 to $300. Together with the $100 which will be given to them next year, needy Singaporeans will receive $400 in Grocery Vouchers over 2020 and 2021.
I will also provide the earlier-announced one-off PAssion Card top-up for Singaporeans aged 50 years and above in cash instead. This is to avoid the need to queue at top-up stations during this period.
With these enhancements, a young family will now receive around $2,900, instead of $1,300, under the Care and Support Package. A three-generation family will receive about $6,700, instead of $1,800.
Second, the Government will partner the community to strengthen the network of support around our workers and families. Self-Help Groups and Community Development Councils (CDCs) have stepped up their efforts to help families and vulnerable groups through their own assistance schemes.
I will support them to do more, and better meet the needs of their communities and residents. I will double the grant given to Self-Help Groups to $20 million over two years and increase the additional grant given to CDCs from $20 million to $75 million.
Together with the other Care and Support measures announced during the Unity Budget, the enhanced Care and Support Package will cost around $4.6 billion.
The Labour Movement is also doing its part to help our workers and self-employed persons.
Last week, NTUC announced the $25 million NTUC Care Fund (COVID-19), which is jointly funded by NTUC, unions and the Government. The fund will provide one-off relief of up to $300 to low and middle income union members.
Yesterday, NTUC announced a $4 million top-up to the Self-Employed Person Training Support Scheme, to give union members an additional training allowance of up to $1 per hour. This will be on top of the enhanced training allowance rates of $10 per hour which I announced earlier.
Our social service agencies also do good work supporting vulnerable groups in our community. We will support them to adopt digital tools to continue to reach out and serve their clients during this period, through the existing VWOs-Charities Capability Fund. Social service agencies can reach out to the National Council of Social Service to apply.
Third, the Government will exercise greater flexibility on its fees and loans during this period.
The Government will freeze all Government fees and charges for one year, from 1 April 2020 to 31 March 2021. This will apply to all fees for Government services. [Applause.]
To help graduates who are worried about having to pay off their student loans while finding jobs in this economic climate, I will suspend all loan repayment and interest charges for one year, from 1 June 2020 to 31 May 2021. This will apply to all graduates who have taken a Government loan for their University and Polytechnic studies.
I will also suspend all late payment charges on HDB mortgage arrears for three months, for those who are struggling with their mortgage payments during this difficult period. HDB will continue to exercise flexibility when providing assistance during this period, through existing measures such as deferring payment of loan instalments for six months.
To summarise, we will protect jobs, support our workers, and protect livelihoods. We will do this by helping employees stay employed; stepping up support for the self-employed and lower-income; creating more opportunities for jobseekers; helping unemployed workers tide over this period; and helping our households with their expenses.
We will continue to monitor the situation closely and are prepared to take swift action to do more if needed.
The second thrust of the Resilience Budget is to help businesses overcome the immediate challenges. The Resilience Budget will address the three Cs on the mind of every business owner now – cashflow, cost and credit.
The first \"C\" is cashflow. For businesses, \"cash is king\" and many have called for more timely assistance. As some have told me in Mandarin, \"远水救不了近火\", or \"distant water cannot put out a nearby fire\", we are doing our best to flow the payouts under the wage support schemes quickly.
By the end of this month, more than $600 million would have been disbursed to employers under the former Wage Credit Scheme parameters. By the end of May, a total of $5.6 billion would have been paid out under the Jobs Support Scheme and the Wage Credit Scheme.
The agencies are working hard to bring forward an additional $500 million of wage credits under the enhanced parameters, from September to end-June.
Altogether, the Jobs Support Scheme and Wage Credit Scheme will flow $16.2 billion into the hands of businesses by October this year.
To further ease cash flow for businesses in the immediate period, I will grant an automatic deferment of income tax payments for companies and self-employed persons, for three months. No application is required. [Please refer to Annex B-4.]
For companies, we will defer income tax payments due in April, May and June 2020. Instead, income tax payments will only be payable from July 2020. In other words, if you paid money last year and need to pay tax this year, you will delay paying for three months so you can use the cash to meet other urgent needs.
For self-employed persons, the payment cycle for personal income tax for the Year of Assessment (YA) 2020 generally starts in May 2020. We will defer the income tax payments due in May, June and July 2020. So income tax payments will only start from August 2020.
Employees may approach IRAS, if they need help with their income tax payments and wish to avail themselves of this arrangement.
The second \"C\" is cost. Where the cost is within the Government’s control, we will do our best to help. I will, therefore, enhance the Property Tax Rebate which I announced in the Unity Budget, by raising the amount and covering more types of properties. [Please refer to Annex B-5.]
For 2020, qualifying commercial properties that have been more badly affected by the COVID-19 outbreak, including hotels, serviced apartments, tourist attractions, shops, and restaurants, will pay no Property Tax. This is a big enhancement, from the 15% to 30% Property Tax Rebate announced in the Unity Budget.
Businesses in other non-residential properties such as offices and industrial properties are also affected by the COVID-19 situation. I will now grant a Property Tax Rebate of 30% for the year 2020.
I strongly urge landlords to fully pass on the rebate to tenants, by reducing rentals, to directly ease the cash flow and cost pressures faced by tenants. Many businesses have pointed out that it will be a lose-lose situation if landlords do not support their tenants. After all, if tenants fail, the properties will be empty. So my message to landlords is: do your part, chip in, and give additional help to tenants who are more badly hit.
The Government will lead by example in supporting tenants by enhancing rental waivers. [Please refer to Annex B-6.]
NEA will give stallholders in hawker centres managed by NEA or NEA-appointed operators three months of rental waiver, up from one month announced in the Unity Budget. [Applause.] Other Government agencies, like HDB and the National Arts Council, will provide two months of rental waiver to eligible tenants, up from half a month announced in the Unity Budget. Beneficiaries include social service agencies and charities. All other non-residential tenants will receive half a month of rental waiver.
In addition, as mentioned earlier, I will freeze all Government fees and charges by one year, from 1 April 2020 to 31 March 2021.
The third \"C\" is credit. I will further enhance our financing schemes so that even the hardest-hit businesses can continue to have access to credit. I earlier enhanced the Enterprise Financing Scheme (EFS) – SME Working Capital Loan to alleviate SMEs' cash flow concerns, and introduced the Temporary Bridging Loan Programme (TBLP) for enterprises in the tourism sector. To support businesses’ trade financing needs, I will enhance the EFS – Trade Loan, by increasing the maximum quantum from $5 million to $10 million, and increasing the Government’s risk-share from up to 70%, to 80%.
I also announce subsidies to businesses for loan insurance premiums under the Loan Insurance Scheme, from 50% to 80%. I will expand the Temporary Bridging Loan Programme (TBLP) to all enterprises, and increase the maximum supported loan from $1 million to $5 million. SMEs that require support beyond the TBLP can continue to tap on the EFS – SME Working Capital Loan. The maximum loan quantum for this will be further enhanced, from $600,000 to $1 million.
In addition, we will work with Participating Financial Institutions to defer capital payments for one year on the EFS-Working Capital Loan and the TBLP loans if requested by businesses, subject to assessment by Participating Financial Institutions. [Please refer to Annex B-7.]
In addition to these enhancements to our financing schemes, I will set aside $20 billion of loan capital in this Budget. This will help to support good companies with strong capabilities, and catalyse private sector loan capital. As the situation is fluid, we will seek to provide help where the credit needs are more acute.
Concurrently, MAS is working with banks and insurers to see how best to help businesses and individuals facing cash flow challenges with their loan obligations and insurance premium payments. Details of these measures will be announced by MAS and the industry later.
All these measures deal with helping people financially.
But there is also an important and complementary part – giving people relief from legal obligations that have arisen because of the COVID-19 situation. It is no fault of theirs that they cannot perform these obligations. For example, people may have paid deposits for a big gathering that now cannot go ahead. It is not their fault that the gathering cannot go ahead. Should the deposits be simply forfeited? That would not be right. The Government is studying the issue, and the Minister for Law will present a set of measures to deal with this at the next Parliamentary sitting.
On top of the broad-based support to help businesses address the three \"C\"s, I will provide additional help to specific sectors that are most directly affected by COVID-19. [Please refer to Annex B-8.]
Sectors that rely on tourism and international travel have been hit the hardest. The sharp drop in international visitors has impacted the whole tourism eco-sector, from our airport and airlines, to hotels and attractions and their tenants, to travel agents and bus companies.
The aviation sector sits at the core of this eco-system. I spoke earlier about countries enacting border control measures to curb the spread of COVID-19. Around the world, many airlines have responded with steep cuts to their capacity. Some have suspended operations. Many airlines unfortunately may not survive the crisis. COVID-19 is the single biggest shock that air hubs and airlines around the world have ever experienced. The International Air Transport Association projected that COVID-19 will hit worldwide airline revenues by up to US$250 billion this year. This is more than 40% of last year’s overall revenues. This will have a profound impact on the global aviation sector for years to come. Consolidation is expected. The better-prepared ones will emerge stronger.
Against this backdrop, governments around the world are taking steps to support their carriers. For example, the US administration has indicated its intent to support both US airlines and aerospace manufacturers. State support for the private sector where there are critical national interests at stake is not unprecedented. During the Global Financial Crisis, the Americans and Europeans stepped in to support their key financial institutions and other companies in major sectors, to avoid wider contagion to the rest of their economies and preserve key economic assets.
Air hubs and airlines with large domestic markets are under stress. Our air hub, with only international traffic, faces an even sharper impact from widespread international border closures. As of 24 March 2020, daily passenger traffic has fallen by more than 90%. The Singapore Airlines Group (SIA) has announced a 96% cut to their scheduled capacity up to end-April across their entire network.
Global connectivity is of fundamental importance to Singapore. It links us to the rest of the world. We are connected by more than 100 airlines to some 380 cities in about 100 countries and territories worldwide. We are an open, globally-connected society. Air connectivity connects us to families and friends studying, working, and living abroad. It enables Singapore-based companies to access growth opportunities overseas, and catalyses investments and business location decisions by overseas companies here. The air hub supports other economic sectors, such as tourism, manufacturing and logistics, and anchors aerospace companies like Rolls Royce and Airbus here.
The Changi Air Hub is an important pillar of our economy. The hub and its adjacent industries contribute over 5% of Singapore's GDP and employ approximately 192,000 people. It makes us an ideal Global-Asia node, where companies all over the world can access opportunities in Asia and companies in Asia can access opportunities around the world.
Our aviation sector has significant linkages to the rest of our economy. If it collapses in a crisis, it will be very hard for the aviation industries to rebuild after the crisis is over, and the recovery of the rest of the economy will be impeded. We must, therefore, ensure that this temporary shock to our air hub does not become a permanent one.
We will support our aviation sector to ride out the COVID-19 pandemic. To help businesses whose activities are based principally in the aviation sector retain their local workers, I will provide an enhanced Jobs Support Scheme. For every local worker in employment, I will provide a total of 75% wage offset for the first $4,600 of monthly wages. This will be paid in the same months as the main Jobs Support Scheme pay-outs. This enhancement will cost the Government more than $400 million.
I also introduce a $350 million enhanced aviation support package to fund measures such as rebates on landing and parking charges, and rental relief for airlines, ground handlers and cargo agents. This will also allow Singapore to retain a minimum level of connectivity to the world even during the pandemic. This is critical to enable overseas Singaporeans to return home and keep our supply lines for essential goods open.
The SIA Group sits at the heart of our aviation eco-system and anchors our position as an air hub. In 2019, SIA Group accounted for over half of passenger traffic and cargo tonnage in Singapore. As the main hub carrier, SIA links us to the rest of the world. Many foreign airlines chose to come to Changi because they can tap on SIA's connectivity to the rest of the region. A diminished SIA will undermine our air hub's ability to recover from the crisis. Air travel would eventually resume when COVID-19 comes under control. Until then, SIA will need liquidity to tide over this outbreak.
In this regard, SIA will benefit from the Enhanced Jobs Support Scheme and the Enhanced Aviation Support Package which will help reduce its operating expenditure. Members will be aware that SIA requested a halt to trading of its securities this morning. I have been informed that SIA is considering a corporate action, supported by Temasek Holdings and will be making an announcement in due course. I welcome Temasek's decision to lend support to SIA. SIA is an outstanding airline and a strategic asset for Singapore.
Through the Government's support for the aviation sector and, if necessary, more direct support measures, we will make sure that SIA is able to come through this in good shape. [Applause.] Ultimately, this is about preserving the status of our air hub so that it can emerge stronger from this crisis. Riding out this storm will require patience and adjustments. With resilience, I am sure our air hub will be able to emerge stronger.
Apart from the aviation sector, several other tourism-related industries, from hotels and attractions to travel agents and bus companies have had a difficult time. As mentioned earlier, I will therefore also enhance the Jobs Support Scheme for licensed hotels, travel agencies, tourist attractions, cruise terminals and operators, and purpose-built MICE venue operators, to offset a total of 75% of the first $4,600 of monthly wages. In addition, I will set aside $90 million to help the tourism industry rebound strongly, when the time is right.
Beyond sectors that depend directly on international travel, sectors that involve a high level of human interaction will take a hit from the recently-announced safe distancing measures. Food services is one such sector, with more Singaporeans avoiding crowds and choosing to eat at home. As mentioned earlier, I will enhance the Jobs Support Scheme for F&B firms by providing a total of 50% wage offset, for the first $4,600 of monthly wages.
Our taxi and private hire car or PHC drivers have seen their takings fall significantly, as more people work from home and as visitorship falls. To support them, we will extend and enhance the Point-to-Point Support Package. This will cost the Government another $95 million. Eligible taxi hirers and PHC drivers will continue to receive the Special Relief Fund payments of $300 per vehicle per month until end-September. We will also extend support to the taxi and PHC operators.
To help private bus owners, I will provide them with a one-year road tax rebate and a six-month waiver of parking charges at government-managed parking facilities. This will cost the Government $23 million.
For the arts and culture sector, we will provide an additional $55 million support package. This will save jobs and support upskilling and digitalisation of the sector.
First, we will provide additional support to major companies and leading arts groups, which are integral to our vibrant arts scene. This will help safeguard jobs and retain capabilities in our local arts ecosystem.
Second, we will enhance the National Arts Council’s Capability Development Scheme for the Arts, to deepen skills and support the professional development of arts organisations and practitioners.
Third, we will step up digitalisation efforts, by building the sector's digital capabilities, and establishing more digital arts platforms which can reach out to new audiences. MCCY will share more details later.
The third thrust of the Resilience Budget is to build resilience in our economy and society, as we battle this downturn, and build capabilities for when the eventual recovery comes.
Let us not face COVID-19 with fear and despair, but with a spirit of resilience. This means keeping our eyes on the future and staying the course, even in the face of hardship and adversity.
If we prepare ourselves well today, we can emerge stronger, not only as an economy, but as a society. I will set aside $1.9 billion in this Budget to support this.
We will build economic resilience at all levels. At the national level, we will continue to invest in our long-term capabilities for growth.
The COVID-19 outbreak has reinforced the importance of investing in R&D to prepare for critical challenges – such as in managing pandemics and ensuring food security.
Our investments in R&D have borne fruit. It has enabled Singapore to become one of the first countries to successfully develop COVID-19 test kits. An example is the Fortitude 2.0 kit developed by A*STAR and Tan Tock Seng Hospital. This is currently used in nine local hospitals and has been sent to several countries including China, Myanmar and the Philippines.
We will continue to make steady investments in R&D, under our masterplan for Research, Innovation and Enterprise. I will provide more details on this towards the end of the financial year.
COVID-19 has also emphasised the importance of having resilient supplies of food and other essential items. We are building up our national stockpile of health supplies, including masks and hand sanitisers, so that we will continue to be well-stocked. Some may be concerned about the impact on our food supplies, arising from supply chain disruptions. We need not worry. We have in place a robust, multi-pronged strategy, to ensure that we continue to have a stable supply of safe food. As we did with water, we are strengthening our food resilience for the long term. Under our \"30 by 30\" vision, we aim to produce 30% of our nutritional needs by 2030, up from less than 10% today.
At the industry level, all firms have a part to play in building economic resilience, as we prepare for recovery. This is why we introduced the SG Together Enhancing Enterprise Resilience (STEER) programme, which supports industry-led initiatives to help companies tide over today’s economic uncertainties and build longer-term capabilities.
The Government will now match $1 for every $2 raised by Trade Associations and Chambers (TACs) or business groups for qualifying initiatives, doubling the earlier matching rate of $1 for $4.
I encourage more TACs and industry groups to join us in helping the business community emerge stronger and better from this crisis.
Businesses should continue to make use of this downtime to digitalise, restructure, and transform. Today, they can leverage the SMEs Go Digital Programme, the Productivity Solutions Grant (PSG) and the Enterprise Development Grant (EDG) to do so. I will further enhance these programmes to give businesses a boost during this period.
First, I will enhance the SMEs Go Digital Programme to provide support for more digital solutions, from basic remote working tools, to more advanced systems. Second, I will raise the maximum support levels for PSG and EDG to 80% and 90% respectively to spur transformation. The enhancements to these three schemes will last until December 2020.
To support our workers to stay resilient, we will enhance our support for skills upgrading. In our Unity Budget, we raised course fee subsidies and absentee payroll to 90% for the aviation, tourism, food services and retail trade sectors, to last until June 2020. I will extend the enhanced training support to the arts and culture and land transport sectors, starting from 1 April 2020. And I will extend the 90% absentee payroll rates to all employers, to provide additional cash flow relief when they send their workers for training, from 1 May 2020. The duration of the enhancements will also be extended to cover eligible courses starting before 1 January 2021. [Please refer to Annex B-9.]
At the individual level, we can all continue to grow and learn in this time of disruption. The SkillsFuture movement is a big part of this. At the Unity Budget, I launched the Next Bound of SkillsFuture to further support our people in acquiring new skills. SSG has worked with Institutes of Higher Learning and Continuing Education and Training Centres, to allow Singaporeans to make early use of the base $500 SkillsFuture Credit Top-up for their courses from 1 April 2020, ahead of the full implementation date in October. I hope this will help many more workers, jobseekers, and self-employed persons make use of the downtime to learn, develop new skills and stay employable.
Let me now touch on building social and psychological resilience.
I mentioned earlier that we are spending over a third of this Resilience Budget to save jobs, protect workers and support households. This is ultimately about keeping our society strong. It is about giving us a sense that we are in this together, that we will look after those in need and trust in one another.
But building a strong society is not just about giving more social support. It is also about fostering a culture of social responsibility. We will do what we can to encourage this.
As the COVID-19 situation develops, we may need to introduce a broader range of safe distancing measures to stop the transmission chain. Everyone must play their part to comply with these measures, for the sake of others.
But it may sometimes be costly for employers and households to comply with these measures. We will provide help where appropriate to mitigate the impact and support responsible behaviour. For example, we have provided support for the costs of quarantine accommodation, to mitigate the costs to individuals and families.
The outbreak has also been a stark reminder of the need for good public hygiene. The Minister for the Environment and Water Resources launched the SG Clean campaign in February to drive higher levels of personal and public hygiene, not just during the COVID-19 outbreak, but beyond.
To make a real difference to public health outcomes, we will need the collective action of businesses and individuals alike. The Government will help. We are already offsetting the audit and certification fees for tourism, retail, and food services businesses participating in SG Clean. We will also co-fund businesses to undertake professional cleaning of premises which have experienced a confirmed COVID-19 case.
MEWR will share more details in due course.
Together with the support that we are providing to workers and households, these will help to keep social bonds strong, encourage social responsibility and foster trust in our society.
To summarise, even as we deal with our immediate challenges, we must keep our sights on the future. With our collective creativity and resilience, Singapore can emerge stronger from this, both as an economy and as a society.
Let me now elaborate on our considerations for drawing on the Past Reserves in this Budget, and our fiscal position after the measures I have put forth to tackle the COVID-19 pandemic.
Our reserves are our strategic asset, built up through the discipline and prudence of our people and political leaders, across generations. Our reserves serve as our bulwark against shocks and crises of an extraordinary nature. For a nation with no oil, no gas, no gold, no diamonds, or natural resources of any kind, it is remarkable that we have built this up. Our prudence and discipline in saving and growing our reserves give us the wherewithal to respond decisively when our nation faces extraordinary circumstances.
Our founding fathers created a rigorous framework to ensure that such strategic assets are used only for the right purpose. We amended the Constitution in 1991 to provide for an Elected President who is the custodian of our Past Reserves. Under Article 148A of the Constitution, the President can withhold her assent to any Supply Bill if she is of the view that it is likely to draw on Past Reserves.
Our principle is that each term of government must live within its means. Any additional spending that the Government of the day proposes must be funded in a sustainable manner – recurrent expenditures should be funded from recurrent revenues.
Past Reserves can be drawn down only in exceptional circumstances, under a two-key system, if the President, after consulting the Council of Presidential Advisers, agrees with the Government’s proposal to draw on the Past Reserves in exceptional circumstances.
Despite political pressure to dip into the reserves, the Government has scrupulously upheld the principle that Past Reserves are to be used only for exceptional circumstances. Until now, the Government has drawn on Past Reserves only once, during the Global Financial Crisis, when the President approved a draw of $4.9 billion to fund the Jobs Credit Scheme and special risk-sharing initiative. During that period, the Government also sought the President’s concurrence to use $150 billion of Past Reserves to back the Deposit Guarantee Scheme. I was in MAS at that time when we had to ask for this, and it took us a long time to deliberate on this before we even did that. As it turned out, the guarantee was not triggered, and there was no draw on the Past Reserves.
The COVID-19 pandemic, and the multiple threats it poses to our nation, is the sort of event that we had accumulated reserves for. We have saved up for a rainy day. The COVID-19 pandemic is already a mighty storm, and is still growing.
If over the years we had frittered the reserves away, on more immediate but less existential needs, big and small, as some in this House have pressed the Government to do, we would be in a much weaker position today.
We are experiencing a confluence of multiple external shocks – a pandemic that has triggered many nations to shut their borders, limit exports and halt economic activities in order to fight this pandemic. The economic impact is magnified, as the global economy is already fragile and further weakened by a protracted US-China trade conflict and an oil price war.
So, this is not a normal business cycle that we would have anticipated and dealt with using the revenues collected by each term of Government. It is a \"black swan\" event that comes only once every few decades.
In view of the exceptional circumstances, the Government has sought the President's in-principle support to use Past Reserves to fund part of the package. Before my Ministerial Statement, Members heard the President's message to Parliament, delivered on her behalf by the Speaker. The Government has obtained the President's in-principle support to draw up to $17 billion to fund some of the measures to save jobs and the economy. These include the Jobs Support Scheme enhancements, the Self-Employed Person Income Relief Scheme, the Temporary Bridging Loan Programme, the enhanced Enterprise Financing Scheme and the enhanced Aviation Support Package. Details are at the Annex. [Please refer to Annex C-1.]
Let me caution that there remains a high level of uncertainty over the future course of the outbreak. Unlike the Global Financial Crisis or the Asian Financial Crisis, where both the causes and solutions were economic and financial in nature, this crisis is far more complex, with additional medical, social and psychological dimensions. The global economy is also more deeply intertwined with many complex inter-linkages. The COVID-19 situation is fluid and fast-moving, and nobody is quite sure how it will develop.
But because we have prepared ourselves well, Singapore has the resources to meet this crisis with confidence. We will use our resources to get through this together. Once again, let me thank the President and Members of the Council of Presidential Advisers for your support.
The Government will continue to monitor the situation closely and do more as and when we need to. Should it become necessary, I am prepared to propose to the President further draws on Past Reserves to deal with the situation. I trust that every Member of this House will deeply internalise the mission to be careful stewards of our reserves.
The measures that I have announced today will raise the Overall Budget Deficit for FY2020 to $39.2 billion. Details are at the Annex. [Please refer to Annex C-2.] We are able to support this unprecedented deficit and still remain fiscally sustainable because we have been disciplined in the use of Past Reserves, tapping on it only in exceptional circumstances like this.
The situation remains highly fluid and uncertain, with significant risks. Our fiscal position will be affected from both the revenue and expenditure sides. With a weak GDP outlook, our revenues will be affected. Sentiment-driven revenues may come down sharply. While revenues are coming down, our expenditure will be going up, to enable us to respond effectively to the crisis. In the past few years, we benefited from unexpected revenue upsides, such as exceptional Statutory Board Contributions from MAS and increased stamp duty collections. We cannot hope to rely on a repeat of this. Instead, we must be prepared to bear the downsides when they happen. Because we have been prudent and did not decide to spend all of the surplus that we collected, we are ready to meet such downsides.
We can expect significant volatility in the economy and in financial markets in the near future. We will need to continue to review our expenditure plans very carefully in this fluid situation. We must stay nimble and adapt our responses as new developments occur.
We will adopt a nimble fiscal posture so that we can quickly channel the resources at hand to the most urgent and important needs of our people.
All of us must remain prudent in the use of our resources. Because of the urgency of the situation, we are providing significant help to many groups in this Budget, in a broad-based manner so that we can reach as many of those who need help as possible and as quickly as possible. I hope that those who receive support will use the resources wisely and responsibly, or channel it to those who may need it more. At the same time, we will not hesitate to take action against any abuse.
Mr Speaker, Sir, before I conclude, allow me to say a few words in Mandarin.
(In Mandarin): [Please refer to Vernacular Speech.] The COVID-19 pandemic is progressing aggressively, causing significant losses to the global economy. In the past few weeks, the number of confirmed cases worldwide has increased exponentially. To avoid losing control of the situation, many countries have announced unprecedented measures to curb the spread of COVID-19. These measures have battered the global economy and financial markets, disrupted supply chains and led to a slump in consumer demand.
Singapore is an open economy. As a result, we have also been badly hit. The pandemic is also a test of our society’s cohesiveness. We must be prepared psychologically and work together to overcome COVID-19.
To help Singaporeans tide over this difficult period, we have drawn up a $55 billion budget aimed at saving jobs, help enterprises and securing our future. This includes the Supplementary Budget that was just announced today and the Budget announced in February.
First, our immediate task is to save jobs and protect Singaporeans' livelihood. Hence, we have extended the Jobs Support Scheme by six months. We will also raise the Government's co-funding of wages from 8% to 25%. This is to prevent companies from retrenching local workers due to a lack of funds.
In addition, we will assist self-employed persons. We will introduce a $1.2-billlion dollar Self-Employed Persons Income Relief Scheme. Qualified Singaporeans will receive cash payout of $1,000 per month for nine months.
We will disburse these subsidies as soon as possible.
Many graduates are worried about job prospect. We have therefore introduced the SGUnited Traineeships, to provide opportunities for young Singaporeans to accumulate work experience in different industries.
Second, to help our enterprises, we will support viable enterprises to continue to operate.
We will provide more property tax rebates and rental rebates. I strongly urge property owners to reduce rents to provide relief for tenants who may be facing cash flow problems.
For industries badly hit by COVID-19 such as the aviation and tourism industry, we will also provide targeted assistance to help them tide over this difficult period.
Third, securing our future. The pandemic may have serious impacts, it may also bring about new opportunities in the longer term. Enterprises should make use of this lull period to upskill their workforce. Singaporeans should also upgrade their skills and prepare for the economic recovery.
But we understand that many Singaporeans are worried that they will not be able to cope with living expenses for the next few months. I will enhance the Care and Support Package introduced earlier. The enhanced package will be worth $4.6 billion.
This supplementary budget is timely and bold.
We do not know when this pandemic will end, nor the scope and scale of its impact. Therefore, we hope to save jobs, help enterprises and secure our future.
We are able to do so because we have our national reserves to serve as our bulwark against shocks. These are extraordinary times. After serious considerations, we have decided to draw on our reserves. The government has obtained in-principal support from President Halimah Yacob to draw on our reserves to fund the series of measures. I would like to take this opportunity to thank the President.
We are able to do this because of our fiscal discipline and we have been preparing for rainy days through the years.
COVID-19 is challenging our unity and resilience. However, if we remain vigilant and calm, and continue to work together as one nation, Singapore can definitely overcome the difficulties, and emerge with confidence.
At this point, I would like to thank our frontline workers, healthcare workers, public servants, enterprises, unions, community organizations and volunteers. Your selflessness and professionalism is critical in helping us keep the COVID-19 situation under control.
We will continue to uphold the spirit of SG Together, to turn this crisis into opportunities, and emerge even stronger.
(In English): Mr Speaker, Sir, I will now conclude in English. The COVID-19 pandemic is the most serious crisis we have faced in a generation. It has put all countries around the world to the test – on the medical, economic and social fronts. We have been able to respond boldly and decisively to the outbreak in Singapore because we have forged a cohesive, resilient society. The whole nation has come together in response. Our healthcare and frontline workers are working tirelessly to care for the infected. Our cleaners are doing humble but heroic work to keep our environment clean. Thousands of public officers are working round the clock to respond to the threat of COVID-19. Private sector and corporations, too, have stepped forward.
Keppel has put together a $4.2 million package to support communities most affected by the COVID-19 outbreak. These include healthcare workers and patients, lower income families and SMEs. This amount was funded by voluntary contributions from Keppel's directors and staff, and dollar-for-dollar matching by Keppel. Our local aviation firms, such as SIA, Jetstar Asia and SATS have also leaned forward to facilitate interested workers to help out in public services that require surge capacity during this period.
Individuals are doing their part. Vloggers and bloggers are helping to share public messages. Others are volunteering, giving support and encouragement and, crucially, by complying with health advisories and practising safe distancing. These include foreigners who live amongst us and who care deeply about Singapore.
Many have also had to make sacrifices in this time. Families have had to make difficult adjustments to their lives, some having to undergo quarantine, cancel celebrations or put off long-awaited plans, including wedding plans. And despite our best efforts to work with businesses and unions to save jobs, some workers have suffered a loss of income or jobs.
The Government and the political leadership are in this with Singaporeans. We share the worries and anxieties of Singaporeans, and we will do our best for you. We will walk with every Singaporean, through every up and down.
To show solidarity with Singaporeans, I announced at the Budget Debate last month that the political leadership will take a one-month pay cut. With the deteriorating situation, we will go further. All Political Office Holders will take an additional pay cut of two months – altogether a three-month cut in their salary. The President, Speaker and both Deputy Speakers have informed me that they will join in and take a similar three-month pay cut in total.
Mr Speaker, Sir, it is in times of crisis that the true character of a nation can be seen.\tWe are all in this together. And we must all look after one another in these trying times. We will stand with one another, through thick and thin. This is what it means to be SG United. This is what it means to be Singapore Together.
The months ahead will not be easy as the situation continues to evolve dynamically and unpredictably.\tWe must continue to be on high vigilance, mentally and psychologically prepared for every scenario.
The Government will lead the way. We will do our best to anticipate and respond to developments, make decisions based on facts and evidence, and exercise judgement when there are trade-offs. While we attend to the immediate and urgent tasks, we will set our sights on the long term so that Singapore comes out of this crisis stronger as a nation. We will protect and advance the well-being and livelihoods of Singaporeans. We will take care of our people. We will leave no one behind. And we will stand with Singaporeans from all walks of life to battle this crisis together.
We will stand with our dedicated and courageous frontline workers – healthcare workers, cleaning staff, immigration officers, public transport workers – who keep Singapore going, despite the risks they face on the job. We will stand with our workers and businesses to ride through this economic storm together and overcome this challenge to our growth and prosperity. We will stand with our fellow Singaporeans to look out and care for one another at a time of fear and anxiety. We will work with our people and institutions around the world to combat this global threat.
This is the essence of who we are as a nation. This is the essence of who we are as a people. This is SG United. This is SG Together.
I am confident that, together, we will ride through this storm and emerge even stronger. [Applause.]
Mr Speaker: Deputy Prime Minister, I believe you have something more to say.
Mr Heng Swee Keat: Mr Speaker, pursuant to Standing Order No 44, I beg to move, \"That the Ministerial Statement made by me be considered by Parliament.\"
[(proc text) Question proposed. (proc text)]
Mr Heng Swee Keat: Mr Speaker, to give Members some time to consider my Statement, I would like to adjourn the debate. Mr Speaker, I beg to move, \"That the debate be now adjourned.\"
[(proc text) Question put, and agreed to. (proc text)]
Mr Speaker: Resumption of debate, what day?
Mr Heng Swee Keat: Monday, 6 April 2020, Sir.
Mr Speaker: So be it. Leader.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Adjournment","subTitle":null,"sectionType":"OS","content":"[(proc text) Resolved, \"That at its rising today, Parliament do stand adjourn to Monday, 6 April 2020, 12.00 noon.\" – [Ms Grace Fu Hai Yien]. (proc text)]
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Rational Immigration Policy in an Irrational Age","subTitle":null,"sectionType":"OS","content":"The Leader of the House (Ms Grace Fu Hai Yien): Mr Speaker, Sir, I beg to move, \"That Parliament do now adjourn.\"
[(proc text) Question proposed. (proc text)]
Assoc Prof Walter Theseira (Nominated Member): Mr Speaker, thank you for allowing me to say a few words. I am going to start with a story about a land quite far away.
Civic Science, a US market research company, posed an innocent question in mid-2019. The question was, \"Should schools in America teach Arabic numerals as part of their curriculum?\" Fifty-six percent, or more than 2,000 respondents, said \"No\".
Of course, this was a trick question. Arabic numerals are the standard system for counting that we all use today. It is based on 10 digits, including zero. The name is a misnomer because the numbering system actually originates in India. It reached Europe around the 10th century after further being developed in the Middle East, hence the term Arabic numerals.
But many Americans have no idea what Arabic numerals are. They just know that they do not like the sound of it.
Mr Speaker, this story illustrates the challenge of making rational immigration policy in an irrational age. People do not always understand the things that they oppose. The debate on immigration is often driven by systematic mis-perceptions of who immigrants are, what they are doing in host countries and how they are contributing to the societies that they live in.
Prof Stephanie Stantcheva at Harvard and her colleagues studied perceptions of immigrants and social policy across six Western countries: France, Germany, Italy, Sweden, the UK and the US. Her research tries to obtain objective measures. Instead of asking people whether they like immigrants, she asks them for their best estimates of facts about immigration.
For example, she asks people: what is the share of immigrants in your country? Where are they from? What proportion are on welfare? This allows for a comparison between beliefs and reality. Her research finds striking mis-perceptions of immigration.
The average respondent in these six countries thinks that the number of immigrants is about two to three times larger than it is in fact. For example, Americans think that more than one in three people in the US is an immigrant. Actually, only one in 10 is. Even if you added illegal immigrants and the native-born children of immigrants, you would not get anywhere near that estimate of one in three.
Respondents have other biases. They think that immigrants are less educated, more likely to be unemployed and more likely to receive welfare benefits than they are in fact.
The immigration debate in these countries appears to be deeply tainted by systematic bias against immigrants. There is a very destructive narrative of a culturally, ethnically, religiously different immigrant, who has arrived in overwhelming numbers and is a welfare burden on the host society. This in turn poisons the policy debate not just on immigration but also on domestic social policy. People cannot think about questions like welfare reform and taxes without thinking about whether immigrants could benefit more than locals.
What can we do about this? Could we just tell people the truth about immigration?
Prof Stantcheva also looked at whether presenting targeted facts on immigration to respondents helped to correct their mis-perceptions. Unfortunately, it turns out that facts are not well absorbed, possibly because our biases are even stronger. But stories actually stick in our minds. Respondents who read a short story about the struggles of a working-class immigrant improved their perception of immigrants and were less likely to think that immigrants were poor because of their own failings.
Let me turn to Singapore. We know that we are an immigrant society. That does not make us any less of a real country or a real people bound together as one. What it means is that being Singaporean is not permanently linked to any language – Singlish aside – or to history or ethnicity. We have the room as a society for our identity to evolve with each new generation of Singaporeans, local-born and immigrants, together. We have the chance to define and to work towards becoming a better version of ourselves.
But each wave of immigration to Singapore has had both disruptive and productive effects on our economy and society. In the lifetime of our first generation of leaders, immigration swung from being a problem in a new country with high unemployment, a booming population and no natural resources to becoming the solution to a rapidly ageing society with manpower constraints and stagnant population growth.
Like many societies, we have developed a conflicted attitude towards immigration. We seek low-wage immigrants to do the dirty, dangerous, demanding jobs that we do not want to do. We depend on high-wage immigrants to fulfill crucial skills shortages to make our economy more competitive. But we often prefer that immigrants are neither seen nor heard, that they fulfill their roles quietly and efficiently, without getting in our way or without competing for our jobs. We complain about immigrants refusing to integrate when it is not clear that we ourselves think that they can become Singaporean one day. We forget that sometimes, that we should never treat other people as solutions to our economic and social problems.
But let me get back to the problem of facts. What do we actually know about the labour market for citizens? How does it compare to that of more recent immigrants such as Permanent Residents (PRs)? This question was debated in Parliament earlier this year because our labour market statistics cover residents as a whole and not citizens and PRs separately.
MOM released the report \"Singapore Citizens in the Labour Force\" in January to address these concerns. As Minister Teo explained, there is actually little difference for many indicators between overall resident outcomes and citizen outcomes. That is because citizens form 85% of our labour force.
However, because citizens are the majority, this also means any differences between resident data and citizen data actually implies a much larger difference between citizens and PRs. Since PR data was not detailed in the MOM report, I will first compute it and then discuss it.
Let me just illustrate how to compute PR data. You can do this at home. It is a fun exercise.
Let us suppose that residents earn $10 an hour. Citizens earn $9.50 an hour. That is roughly the actual ratio of citizen-to-resident median earnings. So, I want to find out how much PRs earn.
Out of every 10 residents, let us say eight are citizens, two are PRs. That is lower than the real proportion but it makes the math a bit easier. So, there are four citizens for each PR. That means average earnings of citizens counts for four times as much as the average earnings of a PR when you compute the average earnings of residents overall.
There is a $0.50 difference between citizen and resident earnings. You multiply that by four times, you get $2. That is actually the difference between PR and resident earnings.
So, in the example I gave, if a citizen earns $9.50 an hour, and residents earn $10 an hour, PRs must earn $12 an hour, $2 more than what residents do. Your real difference is actually a bit bigger because there is actually about 5.66 citizens to one PR in the labour force.
The point is if residents perform a bit better than citizens, actually, PRs are doing a lot better, much better, because PRs are a very small fraction of all residents. This is also true for the reverse.
Using this principle and some assumptions, I have computed estimated labour market outcomes for permanent residents.
First, what are employment rates like? I estimate the PR employment rate rose from about 70% to 74% over the last decade, compared to a rise from about 60% to 63% for citizens. But that is because PRs are generally of prime working age, where the employment rate is high in any case, unlike citizens who are spread throughout all ages.
What kind of jobs are PRs in? I estimate that over the last decade about 71% of employed PRs were PMETs, and this did not change much over time. In contrast, the share of PMETs among employed citizens rose from about 47% in 2009 to 54% in 2018. While citizens have become substantially more skilled over time, PRs have always been fairly high-skilled.
What do PRs actually earn? This is difficult to estimate because median wages are reported, not average wages. Nonetheless, if you assume the wage distribution is similar, a rough estimate is that PRs earn about 35% more than citizens do. But, take that figure with a grain of salt.
Are PR jobs stable? The answer is no, not relative to citizens. The estimated retrenchment rate for PRs is actually much higher than that for citizens. On average, a citizen is just above half as likely as a PR to be retrenched. The citizen retrenchment estimate would go up if you assume that 10% of citizens are self-employed, but not by so much as to cover this gap.
Overall, it is a mixed picture. My estimates suggest PRs are more skilled, earn more, but also face more economic risks than citizens as they are much more likely to be retrenched. There is little surprising about the first few points I made because PRs are often granted based on economic criteria. If our selection of PRs is good, it is logical that they are going to do better on average in the labour market than citizens do.
But reality is a bit more nuanced than we think. The last point on retrenchment is, to me, surprising and needs further study.
Sir, I have described a very incomplete picture of the relative labour market outcomes of PRs and citizens. Most economists would argue the net effect of immigration is positive for the Singapore economy. The problem is that the net effect may hide substantial redistribution to the incomes and wealth of many Singaporeans. Some Singaporeans will have skills that are complemented by immigration and will have better job opportunities and wages, but others may see their job prospects harmed by competition for jobs that immigrants are also highly skilled in. Many Singaporeans also own assets ranging from property to stakes in businesses. These too benefit from immigration, so it affects wealth and not just the labour market.
In the absence of credible research and readily accessible data, I fear that the destructive narratives about the quality and character of immigrants that now plagues politics in many Western countries, will also find a foothold in Singapore.
A 2019 Institute of Policy Studies paper by Mathews, Tay and Selvarajan found that Singaporeans expressed broad support for the benefits of immigration, but they did prefer a calibrated level of immigration at below 20% of the population. Respondents also felt strongly that immigrants were not doing enough to integrate. Close to 40% of respondents felt that immigration issues, if mismanaged, could lead to communal anger; a decreased sense of national identity; and a fall in trust in Government. There was, moreover, broad support for increased Government intervention to address immigration issues.
What might a successful Government intervention look like? I believe we must confront the facts. There are distributional consequences of immigration and despite our best efforts at calibrating immigration flows and manpower policy, some Singaporeans will be better off and some worse off. We need research that documents how immigrants have contributed to our economy, as well as how immigrants have affected employment prospects and outcomes of locals. We need to understand who among our immigrants decides to put down roots in Singapore and who does not stay, and how they assimilate over time. And we need to be prepared to grant targeted help to locals whom we discover are adversely affected by immigration, because the net positives of immigration for the country do not mean anything if your own livelihood is affected.
While we cannot address systematic misperceptions about immigrants with facts alone, the facts are a good starting point. There really should not be a need for a researcher to estimate what are the labour market outcomes of PRs, when it would be easy to publish them outright. We must have courage to accept the political risk of publishing facts on immigration that may be uncomfortable, but are nonetheless better than pleasant platitudes.
But above all, we should not fall into the trap of thinking that the purpose of immigration is to solve the problem of our unwanted jobs, or our falling workforce. Nor does it make sense to think of immigration as simply a means of preserving the status quo and demographics of what Singapore is today. These ways of thinking are counter-productive and unworthy of an immigrant society because they treat immigrants merely as means, and not as an end.
We should not be surprised, then, if the immigrants we attract with this mindset likewise think of Singapore as a means and not as an end. We must build an alternative narrative that stresses building a common future together, not preserving a comfortable past.
Mr Speaker, Singapore is and will continue to be an immigrant nation. But to retain our vibrancy and relevance we must move forward as a country that treats immigrants as potential contributors and partners in developing the Singapore of tomorrow. We need an immigration policy that allows the Singapore – and Singaporeans – of tomorrow to be a better version of who we are today. With a fact- and research-based approach to immigration policy, education and engagement of Singaporeans and an outstretched hand to immigrants who want to join us in this journey, I believe we can build on today's Singapore for a better tomorrow.
Mr Speaker: Minister Josephine.
The Minister for Manpower (Mrs Josephine Teo): Mr Speaker, I thank Assoc Prof Theseira for his views and his suggestions. I must add that I really admire his mental acrobatics and also confess that coming right after a Supplementary Budget presentation filled with very large numbers, I feel my head spinning a bit but I am not unwell; I can do this.
This Government is focused not just on the present but on building a future of opportunities for Singaporeans. Because of our low birth rates and ageing, we face serious challenges. Over the longer term, we aim for a stable and sustainable population.
These are not pleasant platitudes.
This is essential to keep our society strong and our economy vibrant, both of which are important foundations to improve the lives of Singaporeans. We take in a stable and calibrated flow of new immigrants to moderate the impact of an ageing citizen population and prevent it from shrinking over time.
Our immigration policy does not serve just economic objectives. Rather, we want to build a strong and resilient Singapore, with a distinct sense of national identity and common destiny. We, therefore, prioritise new immigrants with the ability to integrate well into our society, and who have expressed their commitment to sinking roots here.
Applicants who can make good economic contributions are certainly welcome, but that is not the sole criterion we consider. Many of our new Permanent Residents (PR) and citizens have family ties with Singaporeans. Most have lived here for many years, formed friendships with locals and are active in the community. From an integration standpoint, these ties are very valuable and we cannot put a number to it easily, we cannot quantify it through any simple metric.
Assoc Prof Theseira pointed out that PRs generally have higher incomes and qualifications than existing citizens. In the first place, that may be a rather narrow way to think of the PRs and to characterise them, and, really, not at all what we set out to achieve.
As I pointed out earlier, we prioritise those with the ability to integrate well into our society and who have expressed their longer term commitment to Singapore. Secondly, are we better off if the opposite were true, that PRs generally have lower incomes and qualifications? Keep in mind that we draw new citizens from the pool of PRs. If that were so, Assoc Prof Theseira, or anyone else, might well ask, quite legitimately, why we are taking in Permanent Residents, or residents who are not as well qualified as Singaporeans or were not doing as well as Singaporeans.
So, this debate would not end no matter how much research we do and no matter how much facts and data we put out.
We do actually have foreigners working in Singapore who generally earn less and are not as well qualified as Singaporeans. They are here on work passes and do not have long-term residency rights.
While we do take in a calibrated number of PRs and new citizens, we are first and foremost focused on improving citizens’ lives. There is a very broad spectrum of things we do to uplift our people and that includes raising educational attainment and growing incomes. Our people have shown consistently that when given the opportunities, they are willing to make the effort and they do well. If while we improve our own educational attainments and incomes, we also manage to attract people with good qualifications and incomes to join our Singapore family as PRs and eventually citizens, is that not a good outcome? Rationally, one would think so but, of course, you can disagree.
In any case, we review our immigration policies regularly, to ensure that they remain relevant. If we come across good research that can help us in policy-thinking, we would certainly look into them deeply and welcome useful suggestions. Today, Singapore is in a good position. Every year, the number of applications for PR and citizenship far exceed the number of places that we grant. We can afford to remain selective as long as Singapore continues to be an attractive and welcoming place for immigrants.
However, we cannot take for granted that this will always be so. We must bear in mind this reality as we plan ahead, to secure a better future for current and future generations of Singaporeans.
Mr Speaker: Do you have any clarifications, Assoc Prof Walter Theseira? None. Okay.
[(proc text) Question put, and agreed to. (proc text)]
[(proc text) Resolved, \"That Parliament do now adjourn.\" (proc text)]
Adjourned accordingly at 5.26 pm.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":"Matter Raised On Adjournment Motion","questionCount":null,"footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Proposal for all MRT Stations and Bus Interchanges to Have at Least One Lactation Room and Breastfeeding Room","subTitle":null,"sectionType":"WA","content":"1 Mr Louis Ng Kok Kwang asked the Minister for Transport (a) what percentage of MRT stations and bus interchanges currently have at least one lactation room and breastfeeding room; and (b) whether the Ministry can make it compulsory for all MRT stations and bus interchanges to have at least one lactation room and breastfeeding room.
Mr Khaw Boon Wan: There are nursing rooms at 50% of our bus interchanges. We will provide nursing rooms at all new bus interchanges and integrated transport hubs.
For the MRT network, we will provide nursing rooms at all new interchange stations. We will also explore providing such facilities when MRT stations undergo upgrading.
Not all MRT stations and bus interchanges need to be provided with nursing rooms as many of them are adjacent to major developments with nursing rooms, such as shopping centres and libraries. This is a balanced approach, to avoid duplication while meeting the needs of nursing mothers.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":"1","footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Proposal to Provide a Set of Guidelines and Encourage Hawkers to Refrain from Practices that Cause Contamination Risks","subTitle":null,"sectionType":"WA","content":"2 Ms Joan Pereira asked the Minister for the Environment and Water Resources as part of the SG Clean campaign, whether the Ministry will provide a set of guidelines and encourage our hawkers to refrain from practices that cause contamination risks.
Mr Masagos Zulkifli B M M: All hawkers are licensed by the Singapore Food Agency (SFA) and are required to comply with licensing conditions and regulatory requirements. These include maintaining and cleaning their stalls regularly, and having proper infrastructure in place to safely prepare, handle and sell food. Hawkers and their assistants who handle food must also pass the Basic Food Hygiene Course, which equips them with relevant food safety and hygiene knowledge, including proper food handling and good personal hygiene practices. SFA conducts regular inspections to ensure that the regulations are adhered to.
The National Environment Agency (NEA) also encourages best practices for the cleaning of hawker centres, such as the use of two separate cloths for table cleaning, as well as sanitising and soaking of cleaning cloths in household bleach at the correct concentration according to manufacturer's instructions. Following the SARS episode in 2003, NEA has also instituted quarterly \"spring cleaning\" for all hawker centres, where hawkers are required to clean up their stalls and the centre is closed for thorough cleaning, such as high pressure jet-wash of the whole centre and cleaning of hard-to-reach surfaces.
When COVID-19 cases were first detected in Singapore, NEA and SFA issued joint advisories and stepped up engagement efforts to food establishments, including hawker centres and hawker stalls, to ramp up cleaning efforts and safeguard public health. Last month, the national SG Clean campaign was launched to rally all Singaporeans to keep Singapore clean. As part of the campaign, NEA and SFA introduced sanitation and hygiene checklists for hawker centres and stalls which highlight key practices to safeguard hygiene and reduce contamination risks. Practices include regular cleaning of premises, especially frequent touch points or heavily soiled areas, and sanitisation of food preparation surfaces, utensils and cooking equipment. Hawker centres and stalls that adhere to the checklists will be awarded the \"SG Clean\" quality mark. To date, 19 hawker centres and one in five hawker stalls have been certified \"SG Clean\". We will audit all hawker centres and stalls for the \"SG Clean\" quality mark standards by this year.
Every Singaporean must also play our part to keep Singapore clean in our battle against COVID-19. As individuals, we should continue to practise good personal hygiene and responsibility like frequent handwashing and temperature monitoring. As a community, we need to exercise social responsibility and collectively keep our premises clean and pest-free to reduce the spread of diseases and viruses. I encourage all Singaporeans to practise the \"7 Habits of Good Public Hygiene\":
1) Keep premises clean and pest-free;
2) Return trays and keep table clean;
3) Keep toilet clean and dry;
4) Wash hands regularly with soap;
5) Take temperature and see doctor if unwell;
6) Use tissues when sneezing or coughing; and
7) Bin litter and soiled tissue.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":"1","footNotes":null,"footNoteQuestions":null,"questionNo":null},{"startPgNo":0,"endPgNo":0,"title":"Proposal for All Pre-schools to Have At Least One Lactation Room","subTitle":null,"sectionType":"WA","content":"3 Mr Louis Ng Kok Kwang asked the Minister for Social and Family Development (a) what percentage of preschools currently have at least one lactation room; and (b) whether the Ministry can make it compulsory for all preschools to have at least one lactation room.
Mr Desmond Lee: The Early Childhood Development Agency does not require all preschools to have a lactation room within their premises. Preschools have the flexibility to manage the use of their space, depending on the needs of their children, staff and parents. For preschools with older children (for example kindergartens) and preschools with more working mothers, the need for a lactation room within the centre itself may be less pressing. For others, we encourage preschools to consider setting up a lactation room or making space arrangements for breastfeeding, as and when the need arises.
In general, preschools should ensure efficient use of space for child development and staff welfare, based on their needs of their children and staff.
","clarificationText":null,"clarificationTitle":null,"clarificationSubTitle":null,"reportType":null,"questionCount":"1","footNotes":null,"footNoteQuestions":null,"questionNo":null}],"writtenAnswersVOList":[],"writtenAnsNAVOList":[],"annexureList":[{"annexureID":1318,"sittingDate":null,"annexureTitle":"Annex B-1","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-1 Enhanced Jobs Support Scheme.pdf","fileName":"Annex B-1 Enhanced Jobs Support Scheme.pdf","sectionType":"OS","file":null},{"annexureID":1319,"sittingDate":null,"annexureTitle":"Annex B-2","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-2 COVID-19 Support Grant.pdf","fileName":"Annex B-2 COVID-19 Support Grant.pdf","sectionType":"OS","file":null},{"annexureID":1320,"sittingDate":null,"annexureTitle":"Annex B-3","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-3 Enhanced Care and Support Package.pdf","fileName":"Annex B-3 Enhanced Care and Support Package.pdf","sectionType":"OS","file":null},{"annexureID":1321,"sittingDate":null,"annexureTitle":"Annex B-4","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-4 Deferment of Income Tax Payments for Companies and Self-Employed Persons.pdf","fileName":"Annex B-4 Deferment of Income Tax Payments for Companies and Self-Employed Persons.pdf","sectionType":"OS","file":null},{"annexureID":1322,"sittingDate":null,"annexureTitle":"Annex B-5","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-5 Enhanced Property Tax Rebate for Non-residential Properties.pdf","fileName":"Annex B-5 Enhanced Property Tax Rebate for Non-residential Properties.pdf","sectionType":"OS","file":null},{"annexureID":1323,"sittingDate":null,"annexureTitle":"Annex B-6","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-6 Rental Waivers for Tenants in Govt-owned managed Non-res Facilities.pdf","fileName":"Annex B-6 Rental Waivers for Tenants in Govt-owned managed Non-res Facilities.pdf","sectionType":"OS","file":null},{"annexureID":1324,"sittingDate":null,"annexureTitle":"Annex B-7","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-7 Enhanced Financing Support.pdf","fileName":"Annex B-7 Enhanced Financing Support.pdf","sectionType":"OS","file":null},{"annexureID":1325,"sittingDate":null,"annexureTitle":"Annex B-8","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-8 Providing Sector-Specific Support.pdf","fileName":"Annex B-8 Providing Sector-Specific Support.pdf","sectionType":"OS","file":null},{"annexureID":1326,"sittingDate":null,"annexureTitle":"Annex B-9","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex B-9 Building Capabilities and Resilience.pdf","fileName":"Annex B-9 Building Capabilities and Resilience.pdf","sectionType":"OS","file":null},{"annexureID":1327,"sittingDate":null,"annexureTitle":"Annex C-1","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex C-1 Use of Past Reserves in Supplementary Budget.pdf","fileName":"Annex C-1 Use of Past Reserves in Supplementary Budget.pdf","sectionType":"OS","file":null},{"annexureID":1328,"sittingDate":null,"annexureTitle":"Annex C-2","filePath":"d:/apps/reports/solr_files/20200326/annex-Annex C-2 Revised FY2020 Fiscal Position.pdf","fileName":"Annex C-2 Revised FY2020 Fiscal Position.pdf","sectionType":"OS","file":null}],"vernacularList":[{"vernacularID":3842,"sittingDate":null,"vernacularTitle":"Vernacular Speech by Ms Joan Pereira","filePath":"d:/apps/reports/solr_files/20200326/vernacular-Joan Pereira GST 26Mar2020-Chinese.pdf","fileName":"Joan Pereira GST 26Mar2020-Chinese.pdf"},{"vernacularID":3843,"sittingDate":null,"vernacularTitle":"Vernacular Speech by Mr Heng Swee Keat","filePath":"d:/apps/reports/solr_files/20200326/vernacular-Heng Swee Keat Supplimentary Budget 26March2020-Chinese.pdf","fileName":"Heng Swee Keat Supplimentary Budget 26March2020-Chinese.pdf"}],"onlinePDFFileName":""}