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Speech at NTUC Fairprice's National Day Observance Ceremony

Mr Lee Yi Shyan, Minister of State for Trade , Industry and Manpower , Fairprice Finest at Tripleone Somerset

Skills, training and development

Mr Heng Chee How, Deputy Secretary-General, National Trades Union Congress

Mr Tan Kian Chew, Group Chief Executive Officer, NTUC FairPrice

Mr Seah Kian Peng, CEO (Singapore), NTUC FairPrice

Mr Charles Khng, Chairman for NTUC Hospitality and Consumer Business Cluster

Distinguished guests

Ladies and gentlemen

  1. Good morning. I am happy to join all of you for the National Day observance ceremony organised by both the NTUC FairPrice and NTUC Hospitality and Consumer Business Cluster.
  2. In a few days' time, we will celebrate 45 years of Singapore's independence. We have good reasons to cheer. Singapore has pulled through the worst financial crisis and emerged stronger. Our GDP for first half of 2010 exceeded 18%. Our employment grew by an estimated 63,000 jobs in the first half of 2010. The prospect for employment growth in the second half of the year remains robust.
  3. Some analysts have described our recovery as one of a V-shaped recovery. Indeed, it is a dramatic turnaround. But if we consider carefully the entire cycle over a 18-month period, our economy went from a -5.3% to more than +18% in the first half of 2010. 9 out of 10 new jobs created were in the services sector. The huge swing offers us some precious lessons.
  4. Firstly, our economy is open to fluctuations in global trade. As the economic tsunami waves swept us in late 2008 and early 2009, we were tossed up and down like a small boat in choppy waters. Our GDP contracted by -8.9% in the first quarter of 2009. Our exporters suffered severe drop in demands. Factory orders were cancelled. Shipments were turned away. We feared a scenario of massive and prolonged job losses. Fortunately, the economy began to recover in the third quarter of 2009.
  5. Secondly, our industries, especially the export sector such as electronics and life science products, remain highly competitive. Their competitiveness allows them to take advantage of the upswing and resupply the world on the back of strong demand. The surge in exports shows that our factories' productive capacities and workforce remain intact, or else they would not be able to ramp up their production level within months.
  6. Thirdly, we have a fast-responsive system that is able to adjust and adapt to the external circumstances. In December 2008, the Government introduced a series of measures to stabilise the liquidity of the financial system. Later in Budget 2009, the Government introduced the Jobs Credit Scheme and Skills Programme for Upgrading and Resilience (SPUR). The tripartite partners issued the Tripartite Guidelines on Managing Excess Manpower. In Budget 2010, we further focused on the expanding the scope of Continuing Education & Training (CET) to build new productive capacities amongst our workers and PMETs.
  7. Throughout this dramatic 18 months or so, our tripartite partners, remained cool-headed, resolved and united. In a number of other countries, workers protested on the streets against retrenchments, but our unions and employers worked closely to cut costs and save jobs. There were cases of workers rioting and destroying cars and buildings in other parts of the world, but our tripartite partners brainstormed on how to build up new capacities in our workers to take on new jobs when the economy recovers. We run a different system, and we have a collaborative tripartite model. Our tripartite partners work for the same goal – to share benefits for all. The outcome of our model speaks for itself.
  8. We have done very well so far in restoring our economy. However, we must not be complacent. What we do from now onwards will define our new competitiveness and shape the outcome of the next economic downturn. The world we live in is never static. Our current strengths and competiveness may be good for now but they will become less valuable over time. Tomorrow, we will need new strengths and sources of competitiveness, more innovative products and higher-value services that the world would want to buy from us.
  9. This is why the Government has established a "National Productivity and Continuing Education Council" (NPCEC) to drive our long-term productivity growth target of 2-3% per annum for this decade. The Council is asking 12 key industries, including the hospitality and retail cluster represented here, to come up with bold sectoral plans that will help industry achieve quantum leap in productivity improvement and service excellence. The Council also seeks ways to support and resource industry-led cluster plans to raise productivity, by way of innovation, process re-engineering, workforce skills upgrading, supply chain development and more.
  10. In the area of workforce skills upgrading, the Government has started to implement our ambitious plan to create a world-class national system for CET. The objectives are to introduce more customised programs, more pathways and to establish better teaching staff and institutions, so as to help rank-and-file workers and PMETs acquire new skills. We have to ensure our workforce remains one of the most competitive in the world.
  11. Many of you gathered here today come from the hospitality and consumer business cluster. Apart from automation, adoption of IT and other technologies, workers' product knowledge and service excellence are also critical in defining the productivity and character of the industry. Some studies suggest that for the services sector as a whole, Singapore's productivity level is less than 60% that of the United States and Japan. This means that collectively as a cluster, the hospitality and consumer business sector has great potential to improve and grow.
  12. As a leading player in the supermarket space, NTUC Fairprice has already renewed its efforts to achieve higher productivity level and service excellence level. For example, Fairprice has invested substantially in infrastructure to support productivity growth in their chain of over 240 stores. This includes an Automated Sortation and Conveyor System at their Central Warehouse Distribution Centre. With the implementation of the new system, goods are sorted out and distributed quicker and more accurately. This also frees up more manpower for work in other areas.
  13. In addition, through the customer centric initiatives (CCI) and other training programmes, NTUC Fairprice has also raised service standards – as reflected from a significantly higher compliments-to-complaints ratio, from 2:1 to 20:1.
  14. There are many ways to raise productivity. But how do we do it in a sustainable way? Our companies must be diligent in benchmarking themselves against the best-in-class players around the world. The process of bench-marking will reveal to us gaps for improvement, whether in the form of technology application and skills training.
  15. Over time, our companies and workers can also become best-in-class themselves. Such must be our aspirations and goals, especially in our cluster's productivity plan.
  16. Doing a piece of job well gives our worker tremendous satisfaction. If we can help every worker to succeed in what he or she does, they will become happier workers with greater pride and self-esteem, which in turn drives service excellence. Service excellence will create loyal customers. This virtuous cycle will bring about better profits for the company and higher pay for the workers.
  17. On this occasion of our National Day celebrations, let us work together – companies, unions/workers and the Government – to benchmark against the best, to learn and close the gap, to innovate and try new ways of doing things, to raise the standard of service to the level we can be justifiably proud of.
  18. I wish everyone a happy National Day. Thank you.