Speech by Minister for Manpower Mrs Josephine Teo at MOM Committee of Supply 2020
Labour Market Situation
1 Let me start by updating members on the labour market in 2019:
a. Despite the economic headwinds, employment growth was better than expected
b. Retrenchments remained low.
c. Singapore citizens continued to earn higher incomes in the recent five years.
2 In fact, if we look back over a longer period since 2015, the employment outcomes for our people has been very positive overall.
3 However, the outlook for 2020 has become very uncertain.
a. Given the COVID-19 outbreak, it would be unrealistic to expect employment growth of the last few years.
b. It will also be a challenge for unemployment to remain in the relatively low range of recent years.
4 These unfavourable conditions demand a united response from all of us.
5 Our first priority is to prevent large-scale job losses.
6 Particularly for those earning lower salaries, we should also prevent a scaling back or reversal of wage increases.
7 This is why the biggest bulk – 60% of the Stabilisation and Support Package announced by DPM Heng goes towards Jobs Support and Wage Credits.
8 Beyond immediate relief, we must not neglect future challenges. In the longer term, we need businesses to transform and keep creating good jobs. We want wages at the lower end to move up more.
9 We also need to help Singaporeans adapt to changing job requirements brought about by technology. The resident workforce will not expand as much as before,and we have more seniors.
10 We will need to help both businesses and our people make the best of the opportunities available. At the same time, we must address their anxieties and be sure to walk this journey together.
Overview of MOM’s announcements
11 MOM’s responses centre on the belief that there must be fairness at work, for both individuals and employers.
a. This is essential to maintaining cohesiveness in an open economy – to give our workers fair chances to progress, and our businesses fair support to succeed.
b. I will be speaking on four areas: (1) Fair Opportunities; (2) Fair Hiring; (3) Fair Competition; and (4) Fair Support.
12 Many MPs also asked that we offer more help to Self-Employed Persons (SEP) who have been hard hit. I share their concerns and will announce more measures to support our freelancers.
13 MOS Zaqy will elaborate on how we can give fair support for lower wage workers and employers of Persons with Disabilities. He will cover foreign workers, as well as their employers.
14 SPS Yen Ling will elaborate on how we are providing fair opportunities for women, as well as fair support for Foreign Domestic Workers and their employers.
B. FAIR OPPORTUNITIES
Update on Adapt and Grow initiative
15 Let me first start with Fair Opportunities. Our aim is to give every Singaporean every opportunity to progress at every stage of their working lives.
a. Last year, we placed more than 31,000 local jobseekers in jobs through the Adapt and Grow initiative (A&G), similar to the number in 2018.
b. More than half were aged 40 and above.
c. Nearly one-third of placements were aged 50 and above. The share was even higher for rank-and-file workers.
16 In fact, since 2016, the A&G initiative, which includes the Career Support Programme, has helped over 100,000 jobseekers get placed. But we are mindful: the work is never done.
a. Therefore, Workforce Singapore (WSG) continues to enhance its service and programme offerings.
b. For example, MyCareersFuture.sg has new features to help employers identify suitable candidates.
SkillsFuture Mid-Career Support Package
17 One particular group we have been thinking about, are Singaporeans in their 40s and 50s. They too deserve fair opportunities to progress in their careers.
18 We recognise that it is a daunting task for anyone in the middle of their careers to reskill for new jobs. This was highlighted by Mr Liang Eng Hwa, Ms Jessica Tan and other MPs.
19 In response, the Government has put together the SkillsFuture Mid-Career Support Package. Let me take a step back to outline the thinking behind the package and what we aim to achieve.
20 Mid-career individuals generally hope that their time invested in training leads to a job. That’s why many programmes are “Place-and-Train” – a jobseeker first secures placement with the employer or attachment with a host company on the strength of his existing work experience, and undergoes additional training to close the skills gap to fully meet job requirements.
21 Most participants on such programmes start their training only after they have been placed with an employer or a host company.
a. 49-year-old Shah Jehan Haniffa and 61-year-old Low Kok Chuen are two examples.
b. Despite limited experience in the logistics industry, Shah Jehan secured a job with ST Logistics through the PCP for Logistics Executives.
c. Low Kok Chuen decided to start work again after two years in retirement, and enter a new industry. Delphic Manufacturing Solution saw his potential and hired him through the PCP for Technical Sales Engineer/Managers.
22 Since 2016, “Place-and-Train” programmes have benefitted nearly 14,500 Singaporeans. Today, we have no shortage of such programmes. For PCPs alone, we have around 100 across around 30 sectors. We have also started moving upstream. To Mr Patrick Tay’s question, in the last two years, over 2000 PMETs were reskilled and redeployed within the same companies, well before they became redundant
23 To Ms Sylvia Lim’s question, capacity isn’t really the issue. Nonetheless, to support more mid-career individuals who may be affected by the faster pace of business transformation, we will expand capacity in such programmes. A good example is the TeSA Mid-Career Advance programme announced earlier by Minister Iswaran. In particular, for workers in their 40s and older – like Shah Jehan and Low Kok Chuen – we aim to double annual placements to around 5,500 by 2025. This is the first pillar of the Mid-Career Support Package.
24 Even then, MPs like Mr Ong Teng Koon are rightly concerned about employer commitment becoming the bottleneck.
25 Indeed, when programme capacity is not fully taken up, it is often because employers are hesitant. Especially when prospects are uncertain, employers might hold back and wait for better conditions or a candidate with a better match.
26 On the other hand, employers continue to tell MOM their frustrations that mid-career jobseekers shun certain occupations or industries. Jobseekers may lack awareness of the opportunities or confidence in their abilities to adapt to new work environments. Some employers also need help to improve job quality to make them more attractive.
27 Therefore, beyond expanding the capacity of reskilling programmes, the Mid-Career Support Package must empower individuals and enable employers.
28 One key pillar of Mid-Career Support Package is the additional top up of SkillsFuture Credit.
a. This aims to empower persons in their 40s and 50s to refresh their skills, to complement their employers’ training investments.
b. Bear in mind that many courses are already heavily subsidised by the Government, up to 90% in some instances.
c. This additional top-up will mean even lower out-of-pocket expenses.
29 At the same time, besides “Place-and-Train” programmes, we will ramp up “Train-and-Place” programmes.
a. These programmes do not require employer commitment upfront.
b. But, as long as the programmes are well designed to plug skills-in-demand, participants have a good chance of getting job placements after they are trained.
30 At MOE’s COS debate, SMS Chee Hong Tat will share more details.
31 For “Place-and-Train” programmes all trainees receive full salaries or allowances. For example, during the 9 months of the PCP, Shah Jehan whom I cited earlier received full salary from his employer – 90% of which was subsidised by the Government.
32 In other words, although we do not have unemployment insurance in Singapore, we have programmes provide income support to unemployed persons who are prepared to undergo reskilling, which maximises their chances of returning to work.
33 To empower mid-career individuals, another important pillar is our career advisory system. This is the scaffolding and hand-holding that I spoke about in response to Ms Sylvia Lim’s points during the budget debate.
34 Today, this capability resides in several agencies.
a. WSG and NTUC’s e2i have been offering employment and training assistance for well over a decade.
b. Since the SkillsFuture movement was launched, the five CDCs have also been mobilised. Through SkillsFuture Advice Workshops, more than 100,000 Singaporeans have gained deeper understanding of their skills and how they can keep abreast of industry developments to stay relevant in their careers.
c. About three years ago, we roped in the private sector. Two best-in-class operators with good track records other countries were appointed to supplement government efforts in career matching.
35 Sector agencies are also involved. Last year, for example, MAS and the Institute of Banking and Finance released a joint study on the impact of automation and data analytics on 121 job roles in financial services. Among several outcomes, the Technology in Finance Immersion Programme was launched. Mr Henry Kwek and Mr Leon Perera will be reassured to know that other agencies are conducting similar studies to help with workforce and career planning.
36 WSG has also intensified support to job seekers through a suite of high-touch career coaching programmes.
a. The Career Recharger module equips discouraged jobseekers with a positive mindset for their job search journeys;
b. The Career Catalyst module offers one-on-one coaching to help jobseekers uncover their strengths and career options;
c. The Career 360 module helps jobseekers access networks to widen job opportunities.
37 In this regard, peer support can be very useful. There is untapped potential in our professional communities where many seasoned professionals have rich experiences to share. They are plugged into the challenges and opportunities in their respective fields, have established networks and may themselves have navigated career transitions.
38 We can therefore complement our team of full-time career coaches by building up a pool of volunteer Career Advisors.
a. Career Advisors will receive training to provide sector and occupation-specific career advice and outline career options.
b. Career Advisors will also be equipped with in-depth knowledge of resources and channels of support such as the A&G programmes
c. In short, we hope that the Career Advisors can help to boost the confidence of their mid-career peers in charting the way forward.
39 At the same time, as the Institutes of Higher Learning ramp up “Train-and-Place” programmes, they will also need to be better at providing career advice to mid- career individuals. MOM and MOE will work together to consolidate our resources and boost our collective capabilities in empowering individuals to take charge of their careers.
40 In terms of support to employers, the priority is to bring down the cost of recruiting and training for mid-career jobseekers. We must also keep up the pace of business transformation and job redesign.
41 From 1 April, we will boost salary support for all workers aged 40 and above enrolled in “Place-and-Train” programmes, from 70% to 90%. This pillar comes on top of very generous funding already available for the training components.
42 Essentially, the Government will underwrite almost the entire salary and training costs of mid-career recruits for the period of training.
43 Further, we will provide a new incentive for employers who hire workers aged 40 and above, through any “Place-and-Train” or “Train-and-Place” programme.
a. This pillar comes on top of the salary support during the training period.
b. It will cover 20% of the new hire’s monthly salary for half a year, capped at $6,000 in total.
44 SMS Heng Chee How will be pleased to know that the enhanced employers support extend to workers above age 60. Depending on the duration of training, this means employers will get salary support of up to one year in most cases. This is not even including the Senior Employment Credit which I will talk more about later.
45 Beyond these two pillars, the Government is providing another two pillars of support for employers to implement business and workforce transformation plans.
a. That is the reason for the $10,000 SkillsFuture Enterprise Credit which MTI has highlighted.
b. Through the enhanced Productivity Solutions Grant (PSG), we will also provide up to 70% funding for companies to engage job redesign consultants. This is important for ensuring that jobs become more attractive, especially to mid-career individuals and seniors. Most of the remaining 30% out-of-pocket expenses can be paid off using the new SkillsFuture Enterprise Credit. In other words, costs will be very minimal, for SMEs in particular.
46 Mr Douglas Foo and Mr Gan Thiam Poh were understandably concerned that employers may no longer be short of training funds but training time. For companies with a clear plan to transform their business, MOM will consider supporting them with transitionary manpower. Others may take advantage of the current downtime to increase training hours.
47 Through the five pillars of the SkillsFuture Mid-Career Support package, we will be investing close to $750m in the reskilling and placement of mid-career workers, over the next five years. Taken together with the SFEC and enhanced PSG, we are providing a very significant boost of about $1 billion, to the employment prospects of Singaporeans, especially those in their 40s and 50s. They are a clear commitment to ensure Singaporeans have fair opportunities to progress at every stage of their working lives.
C. FAIR HIRING
Stepping up on fair consideration
48 At the same time, we will need employers to uphold the culture of fairness at the workplace. This means taking care to ensure there is no discrimination of any kind.
49 In Singapore, where the workforce includes foreigners, we are particularly watchful about discrimination against locals. Under the Fair Consideration Framework, or FCF, we require employers to advertise on MyCareersFuture.sg before submitting Employment Pass applications. This is to ensure Fair Hiring and guard against job openings being restricted to “closed circles of friends”.
50 Mr Murali Pillai pointed out that job positions with salary of $15,000 and above are currently exempted from the FCF job advertising requirement. This threshold was last updated in July 2018, when we also required smaller firms with at least 10 employees to advertise
51 From 1 May 2020, MOM will expand the advertising requirement to include positions paying up to $20,000. Positions that are more senior remain exempted as they are more likely to be market-sensitive.
52 As for intra-company transferees which Mr Patrick Tay asked about, they need to meet stricter criteria to qualify. As a result, they have constituted to a very small share of EP applicants. I will take this opportunity to remind employers not to treat the advertising requirement as a paper exercise.
a. MOM has started to use data analytics to scrutinise EP applications.
b. We also actively follow up on leads provided by whistle-blowers.
53 Members will appreciate that this is a laborious exercise.
a. Sometimes, disgruntled employees or competitors send us on a wild goose chase.
b. Employers may also use delay tactics to frustrate us.
54 Nonetheless, if we uncover evidence that an employer had pre-selected a foreign candidate and did not give fair consideration to qualified local applicants, we will reject the EP application and ban the employer from hiring or renewing foreign workers.
55 Under the FCF, MOM has also proactively identifies employers suspected of nationality-bias in their hiring.
a. We look out for employers with exceptionally high share of foreign PMETs compared to industry peers, or high concentrations of single nationalities.
b. These employers are put on an FCF Watchlist where all of the EP applications will be scrutinised or withheld.
56 Among other MPs, Mr Patrick Tay and Mr Chong Kee Hiong asked for an update of these efforts. I informed Parliament last year that MOM had put about 600 firms through the FCF Watchlist. We have since cast our net wider and scrutinised about 1,000 firms.
a. To date, a total of 3,000 EP applications have been rejected or withheld by MOM, or withdrawn by employers.
b. In addition, firms under the FCF have hired more than 4,400 Singaporean PMETs over the same period.
57 Our objective is not just to penalise errant employers. We want them to improve. This is why we reached out to another 350 employers whose workforce profiles give us cause for concern, so that they take steps to strengthen local hiring. But it also means that having served notice to these employers, MOM will not hesitate to put them on the FCF Watchlist if their workforce profiles deteriorate.
58 Nationality bias is only one form of discrimination. I agree with Mr Lim Biow Chuan that we should take firm action against all forms of discrimination. This is why I announced earlier this year stiffer penalties for discrimination by age, gender, nationality or mental health condition. Employers that violate the Tripartite Guidelines on Fair Employment Practices will be barred from hiring new foreign workers or renewing existing ones for a minimum of 12 months, up to a maximum of 24 months.
59 In January 2020, MOM released the details of five employers that were penalised under this new framework.
a. We have taken action against another 18 more, bringing the total to 23 employers sanctioned under the new penalty framework in just over two months.
b. In one case, a 51 year old applying to be a receptionist was told that she was “too old” when she called to enquire. MOM discovered that the firm had a policy where only candidates younger than 45, female and Chinese would be invited for interview. We have acted against the employer.
c. We will also hold culpable key decision makers responsible, whether it is the CEO, Chief HR Officer, or line managers. We are prepared to name them publicly, and revoke their work passes if they are foreigners.
60 Some people may feel that the penalties are still not enough.
a. A 24-month debarment is actually quite painful.
b. Most of the work passes will expire during this period, but none can be renewed.
c. Neither can the employer hire new foreign workers.
d. In other words, these employers would need to hire more locals if they want to continue their operations in Singapore.
61 MOM will also prosecute employers and key personnel who make false declarations on fair consideration.
a. One employer has been charged so far.
b. If found guilty, the penalties are up to 2 years of imprisonment and, fines of up to $20,000, or both.
62 We will continue to remain vigilant against discriminatory employers, and take firm action against those who try to circumvent our fair hiring requirements.
63 But we cannot do this alone.
a. Workers who come across workplace discrimination should surface it to MOM or TAFEP.
b. Employers should review employment practices to weed out discriminatory practices.
c. Employer organisations should call out members with errant practices that tarnish their sectors.
D. FAIR COMPETITION
64 Besides the assurance of fair hiring, our people want the assurance that they compete on a level playing field. Fair-minded Singaporeans do not expect to be given a free pass, but they do expect Fair Competition, and rightly so.
Tightening S Pass policy
65 As announced by DPM Heng, we will implement cuts to S Pass quotas for the Construction, Marine Shipyard and Process sectors in 2021 and 2023. As he explained, S Passes should not be a means by which enterprises hire low-cost foreigners when qualified locals are available.
66 Ms Cheng Li Hui asked what jobs were available in these sectors, and what we were doing to train locals for them. In Construction, for example, there is growing demand for PMETs skilled in Building Information Modelling (BIM), to use advanced software to visualise and manage building projects. Many draughtsmen who previously made technical drawings are now taking on more complex BIM roles. Other jobs performed by technicians and engineers will be equally transformed by automation and digitalisation.
67 Our educational institutions already work closely with industries to ensure their students have the right training. From 2017 to 2019, there was an annual average intake of 7,400 polytechnic students in related courses. For mid-career persons, we have PCPs for BIM Professionals, Marine Engineers, Marine Technicians, and Process Construction and Maintenance Professionals.
68 I am aware that affected businesses may still be worried they cannot find people. It is unlikely that locals will change their minds if work conditions do not improve. But as long as employers are willing to make changes, we will help you:
a. The SkillsFuture Work-Study Programme can help you identify suitable polytechnic and ITE graduates and defray their training costs.
b. You can also consider mid-career workers. I have outlined the enhanced support for employers under the Mid-Career Support Package.
c. I urge employers to get in touch with WSG or the relevant trade associations. For example, in the last three years, trade associations and chambers have helped more than 4,500 SMEs recruit mid-career PMETs through the P-Max programme.
Updating the Employment Pass and Local Qualifying Salary Thresholds
69 Besides quotas, we regularly review other measures to control the foreign workforce.
70 To ensure that firms do not hire locals on token salaries just so that they can hire more foreign workers, only workers that are paid above a threshold each month can be counted towards a firm’s S Pass and Work Permit DRCs. We call this the “Local Qualifying Salary” (LQS).
71 We have been regularly updating the LQS to ensure that it keeps pace with rising local wages at the lower end. We last raised the LQS threshold from $1,200 to $1,300 in July 2019.
72 We will be raising it further from $1,300 to $1,400 on 1 July 2020. Most employers of foreign workers are not affected because they do not have workers earning below $1,400. Even for those that are, the extension of the Wage Credit Scheme should provide some relief. In any case, like Ms Denise Phua and Associate Professor Walter Theseira, I hope employers and their customers do not begrudge the raising of salaries at the lower end.
73 At the S Pass and EP levels, MOM regularly updates the salary criteria applicants must meet to work in Singapore. These criteria take reference from salaries of locals with similar experience and seniority, to ensure that S Pass and EP holders are of good calibre and do not undercut wages of our local PMETs. This is why older and more experienced candidates need to command higher salaries in order to qualify for an S Pass or an EP. It keeps the competition fair.
74 The S Pass salary criteria were raised in 2019 and this year. We last raised the EP minimum qualifying salary in 2017, from $3,300 to $3,600 per month. We will be raising it from $3,600 to $3,900 per month. This increase is in line with improving wages of fresh graduates of local autonomous universities.
75 The salary criteria for older and more experienced EP candidates will be raised in tandem. For example, an EP applicant in his early 40s will need to earn around double the new minimum qualifying salary of $3,900. This is only fair, considering the skillsets he or she is expected to have. It helps to ensure a level playing field for experienced local mid-career PMETs.
76 The new salary criteria will apply to new EP applicants from 1 May 2020. However, for EP renewals, they will apply one year later, from 1 May 2021. This staggered approach will moderate the impact on businesses.
77 With these changes, employers should continue to ensure that they have fair and merit-based pay practices, in line with the Tripartite Guidelines on Fair Employment Practices.
a. Anecdotally, we have heard of firms that only raise salaries of the EP holders to meet new salary criteria, while freezing salaries of the local workers, even if the local workers are better performers!
b. This is wrong and not in the employer’s best interest.
c. Apart from the risk of having their work pass privileges cut back by MOM, such practices will undermine their efforts to retain their local employees.
E. FAIR SUPPORT
78 While we are asking a lot more of our employers, we are also providing them with fair support. Likewise, we will give fair support to the self-employed, and for Singaporeans in general to build up their retirement nest egg.
Senior Worker Support Package
79 Let me outline the enhanced support for senior employment, which Mr Henry Kwek and other MPs spoke about.
80 Over the past decade, senior employment rates among locals have grown steadily. In 2018, I convened the Tripartite Workgroup on Older Workers to study ways to further support senior employment. It announced its recommendations last year, which the Government has accepted in full.
81 The Retirement Age (RA) and Re-employment Age (REA) will be raised to 65 and 70 respectively by 2030. To help businesses adjust, each move will be implemented in small steps with sufficient notice.
82 In addition, the CPF contribution rates for senior workers will be raised gradually over the next decade.
a. The first increase will take effect from 1 January 2021.
83 The exact timing of future moves will be decided later, but we aim to implement the full increases by 2030.
84 Yesterday, Minister Shanmugam announced that the retirement age for Home Affairs Uniformed Services will be raised from age 55 to 58 by 2030. MOM welcomes this move and will work with MHA and tripartite partners to similarly review retirement age policies for Auxiliary Police Officers and private-sector firefighters.
85 As outlined in the Budget, the Government will support employers to implement these changes, including creating more age-friendly workplaces.
86 We will do so through the Senior Worker Support Package which will provide up to $1.3 billion in support over three years from 2020 to 2022.
87 Businesses had called for continued Government support for the employment of senior workers, in particular wage offsets similar to the Special Employment Credit.
88 The Government has heard these calls. From 2021, through the new Senior Employment Credit, we will provide wage offsets to employers that hire senior Singaporean workers aged 55 and above.
a. For 2021 and 2022, employers will get up to 8% of the wages paid to workers aged 55 and above.
b. Similar to the Special Employment Credit, more support will be given for those in higher age bands.
c. The employment rate for workers aged 55-59 has improved greatly and is now close to that of the 20-64 age group. Hence, wage offsets for the 55-59 age group will be 2% in 2021 and 1% in 2022.
d. We will instead focus resources on the older age groups which have lower employment rates. Wage offsets for those aged 67 and above will be the highest, at 8%.
e. Overall, companies will get $660 million in Senior Employment Credit over two years.
89 In 2021, we will offset half of the increase in employer CPF contribution rates through the CPF Transition Offset scheme.
a. Companies will receive about $80 million.
90 We are not depending on SEC alone to support senior employment, We encourage progressive companies to raise the RA and REA ahead of legislative schedule. To do so, we will introduce a Senior Worker Early Adopter Grant (EAG). Companies can get up to $250,000 each under this grant.
91 Through the Tripartite Workgroup’s public consultation and other surveys, senior workers told us that they would like to reduce their work intensity gradually as they approach retirement.
a. They are also more prepared to remain in the workforce if they can undertake part-time work arrangements during the re-employment phase.
92 While the Tripartite Workgroup explored legislating the provision of part time re-employment, employers expressed serious concerns:
a. Many employers today provide mostly full-time positions. Their work structures and processes cannot support workers on partial shifts, or job sharing of full-time positions.
b. This explains our relatively low part time employment rate for seniors.
93 The Workgroup agreed on a promotional approach to give employers time to adjust. To give these efforts a bigger push, we will introduce a new Part-Time Re-employment Grant (PTRG) that provides up to $125,000 to each company that commits to providing part-time re-employment opportunities to eligible senior workers upon their request.
a. This will benefit seniors who prefer lower work intensity, thereby encouraging them to stay in the workforce.
b. Both the EAG and PTRG will provide support of $100 million to companies over three years.
94 In total, we estimate that up to about 110,000 companies and 570,000 workers will benefit from the Senior Worker Support Package.
Update on self-employed persons
95 Let me now address the concerns of self-employed persons. .
96 Based on our most recent survey, the share of individuals who took on self-employed work as their main job remained stable at around 8% to 10% of our resident workforce.
97 Most of our SEPs have a preference for self-employment over regular employment. A small number would actually prefer to be in regular employment but could not find suitable openings. We encourage them to approach WSG or e2i which will help them through the relevant programmes.
98 While some SEPs ponder their longer-term plans, the immediate concern of all is the significant drop in earnings due to the COVID-19 outbreak. Sector agencies are stepping in to help those directly impacted. For example,
a. MOT has put together a $77 million package to help taxi and private hire care drivers.
b. STB is also providing licensed tour guides with short-term relief.
99 SEPs in other occupations may see lower earnings because their clients have delayed projects or postponed bookings.
a. This is no doubt, a period of difficulty.
b. But it is also a window of opportunity for skills upgrading.
100 I will therefore introduce a new SEP Training Support Scheme, which I believe Mr Patrick Tay, Mr Ang Hin Kee, Mr Desmond Choo, Ms Tin Pei Ling and other MPs will welcome.
a. Over the next three months, all SEPs will be paid a training allowance of $7.50/hour when they attend courses under the SkillsFuture Series, as well as selected sector-specific training programmes.
b. Not only will this scheme supplement their income, it can help them become more future-ready.
101 To illustrate, consider a 45-year old freelance sports coach or media freelancer who decides to brush up on business management skills by taking a series of courses covering areas such as digital marketing, and design thinking.
a. Together, there are 6 modular courses stretching over 90 hours or about 12 days.
b. With SSG’s enhanced 90% subsidy of the course fees for those aged 40 and above, this sports coach or media freelancer would only need to pay about $400 for the course. By using his SkillsFuture Credit, he will not need to pay a single cent out of his pocket.
c. Furthermore, he will receive training allowance of $675.
102 The SEP Training Support Scheme is a practical way to provide fair support to SEPs in these tough times.
a. The Government will set aside $36 million for this purpose.
b. There is no cap to how much training SEPs can sign up for.
c. NTUC, which has established outreach channels to freelancers, will administer this scheme, and release details on how to apply soon.
103 Even as we support SEPs in the short-term, we are also concerned about their longer-term needs. In 2017, the Government set up the Tripartite Workgroup on SEPs.
a. Through extensive consultations with stakeholders, the Workgroup found that most SEPs did not expect their clients to provide employment benefits or treat them as regular employees.
b. Instead, SEPs asked the Workgroup to focus on addressing their practical concerns.
c. Their preferences shaped the Workgroup’s recommendations, which have been progressively implemented since March 2018.
104 For example, the Tripartite Alliance for Dispute Management extended its services to SEPs to help resolve payment-related disputes.
105 We also launched the Tripartite Standard on Contracting with SEPs to promote fair contracting norms and have made good progress. Grab, a major player in the private hire car and food delivery markets, recently adopted this Standard, joining about 710 other progressive businesses. This means that the 85,000 SEPs engaged by these adopters will be provided with clear written terms to minimise disputes, such as when payments would be made.
106 We call on more service-buyers to do their part by providing SEPs with clear written contracts. We also encourage service-buyers to adopt the Standard, to be more attractive among SEPs.
107 Finally, I will like to provide an update on retirement adequacy, an issue close to the hearts of Singaporeans. We are committed to providing fair support to help our people prepare for retirement.
108 n fact, successive cohorts of Singaporeans have been able to set aside more CPF savings for retirement. Over the last decade, median CPF balances of active CPF members aged 55 have also more than doubled from $71,000 to $155,000. This is because of:
a. Higher labour force participation rates and rising wages; as well as
b. Enhancements to the CPF system, such as the increases in CPF contribution rates and CPF salary ceiling.
109 As a result, even as the Basic Retirement Sum (BRS) has been raised gradually for each cohort, more active CPF members have been able to set it aside at age 55, from about four-in-ten a decade ago to more than six-in-ten today.
110 That does not mean our job is done. The CPF is a ‘live’ system, and must continue to evolve.
a. Incomes continue to rise and so will spending needs in retirement.
b. This is why the Government accepted the Tripartite Workgroup’s recommendation to gradually raise CPF contribution rates for senior workers over the next ten years.
c. By the time we are done with the full increases around 2030, the median member aged 55 can expect his retirement payouts to be boosted by close to 10%.
111 The first increase in CPF contribution rates will take effect from 1 January 2021 but the next steps have yet to be decided. Associate Professor Daniel Goh asked if we could accelerate the pace.
a. Ideally, we would like to.
b. But this desire needs to be balanced against the impact on the senior workers’ employability and take-home pay, factors which he has outlined.
c. This is why CPF contribution rates should continue to be stepped down by age, and why the Workgroup recommended small increases each time.
d. Given the current pressures on employers and job security, we should proceed with care.
112 Over the years, we have also refined our retirement system to be more fair and progressive.
a. The Government provides higher interest rates of up to 6% on lower CPF balances.
b. The Government also tops up the CPF accounts of lower-balance members from time to time, such as the recent Bicentennial Bonus CPF top-up.
c. Targeted subsidies are provided to lower-income Singaporeans with lesser means, through Workfare in their working years and Silver Support in retirement.
d. All these translate into substantial support for lower-income households in retirement.
113 The Government will take additional steps to strengthen retirement adequacy of Singaporeans.
CPF for Self-Employed Persons (SEPs)
114 We launched the Contribute-as-you-Earn (CAYE) pilot at the start of the year to help SEPs better save for their healthcare needs through smaller and more regular MediSave contributions whenever they earn income. We expect about 3,000 SEPs or so working with Government agencies each year to make CAYE contributions.
a. To help SEPs come on board the scheme, we will provide a dollar-for-dollar matching for CAYE contributions made in 2020, capped at $600.
b. Mr Chen Show Mao will be pleased to note that around 400 SEPs have made CAYE contributions in January alone. This is encouraging. All of them will receive matched MediSave contributions from the Government.
115 SEPs can also save for retirement through cash-top-ups schemes. Those who are eligible can tap on the Matched Retirement Savings Scheme, which I will elaborate on later.
116 In addition, SEPs may receive additional support through the Workfare Income Supplement (WIS) Scheme.
a. From 1 January 2020, the qualifying income cap and maximum annual payouts have both gone up.
b. In addition, they will receive an additional 20 per cent of their WIS payment for work done in 2019, with a minimum payment of $100. This will be given in cash.
c. Each year, more than 50,000 SEPs receive Workfare. With the COVID-19 situation, I expect more SEPs to qualify this year.
Matched Retirement Savings Scheme
117 More broadly, to help Singaporeans with less CPF savings, we will introduce the Matched Retirement Savings Scheme (MRSS) from 2021 to 2025. This can benefit lower-income seniors, and in particular, gig workers and ‘unpaid’ caregivers, who typically have less in their CPF.
a. The Government will match cash top-ups made to the Retirement Account of eligible members, up to $600 annually or $3,000 over five years.
b. About 435,000 Singaporeans will be eligible for MRSS each year.
118 There are no restrictions on who can contribute.
a. For example, employers may want to use MRSS as a staff benefit to recognise long-serving senior workers and help them set aside more for retirement. They will enjoy tax reliefs for cash top-ups.
b. Working adults can also make top-ups to their stay-at-home spouses, or their parents who are nearing retirement.
119 Will MRSS work?
a. Associate Professor Walter Theseira is not so sure and suggested that people be asked to commit their savings in advance, for example, their WIS cash payouts or annual bonuses.
b. I thank him for thinking about how to improve MRSS.
c. We will study the practicalities of his suggestion.
120 Let me round off this section with the Silver Support Scheme.
121 Silver Support targets seniors who had lower-incomes throughout their lives and have less in their retirement. Since 2016, we have disbursed close to $1.6 billion to over 200,000 seniors.
122 From 1 January 2021, we will do the following:
a. Increase the quarterly payouts by 20% for all flat types.
b. Expand the criteria for lifetime wages.
c. Expand the criteria for household monthly income per person from $1,100 to $1,800, with two tiers of payouts.
123 With these enhancements, close to 250,000 Singaporeans aged 65 and above will benefit in 2021. This is about100,000 more than today. Total Silver Support payouts will almost double from $330 million currently to about $620 million in 2021.
124 MOM will continue to review our policies to improve the retirement adequacy of Singaporeans. This includes studying the feasibility of introducing the CPF Lifetime Retirement Investment Scheme (LRIS), which Ms Foo Mee Har asked about.
a. LRIS will be designed for members who wish to invest their CPF monies but have neither the knowledge nor time to do so.
b. To be attractive, it has to charge low fees.
c. There must be a good chance of earning higher returns than the current CPF interest rates.
d. But it should also provide some assurance against downside risks.
125 This is a complex effort with multiple objectives that are not always consistent with each other. Given the many issues that demand MOM’s attention, I seek members understanding that we need more time to get the fundamentals of LRIS right. We will provide an update when ready.
126 Mr Chairman, please allow me to conclude in Mandarin.
F. 协助国人掌握事业前景 优先保障国人饭碗
128 面对这些大环境因素， 国人对就业前景或许感到忧虑。
129 政府将会竭尽所能，优先保障国人的饭碗。130 尤其是四五十岁的中年员工，恰好处于必须养家糊口的人生阶段 – 上有年迈父母、下有正在求学的子女，并且大多数都还在供房子。他们担心，尽管努力工作，能不能避免被时代淘汰的风险？
a. 因此， 我们必须对症下药，雇主如果愿意投入时间和精力，培训中年员工或是中途转业者，就能享有百分之90的雇员薪金支援。
134 常言道， “家有一老，如有一宝”。 我希望，企业界也能秉持“企业有一老，就如有一宝”的愿景，协助更多年长者实现工作更久、储蓄更多的心愿。
140 从今年起，我们加强了Workfare就业入息补助计划，让更多低收入的国人受惠。Silver Support乐龄补贴计划目前惠及15万名年长者，从今年底开始，每季度现金补贴将增加两成。明年，这项计划的条件放宽，将能让额外10万名年长者受惠。政府将不断调整这些援助计划，照顾社会中的弱势群体。