Singapore Companies' Efforts to Upskill Employees and Use of SkillsFuture Credits to Train for Alternative Careers

Ms Foo Mee Har asked the Minister for Education (Higher Education and Skills) whether the Government tracks the utilisation of SkillsFuture credits to prepare Singaporeans for alternative careers and how successful the scheme has been in preparing Singaporeans for new jobs especially amongst older workers.

Let me give a bit of background. Historically, our adult workers' training system tended to support employers training their workers, much more than empowering workers to take charge of their own lifelong learning journey. Just winding back to 10 years ago, Government funding for lifelong learning was heavily weighted towards employer-supported training, with a small proportion going to individual-initiated training. That is the historical background.

Over the years, the Government has expanded its funding support for lifelong learning, and also shifted funding more towards supporting individuals directly. This is necessary, given the increase in number of contract workers and freelancers, and that it is much more likely that individuals will take the initiative to prepare themselves for their next careers, as opposed to expecting employers doing so for them.

Today, the Ministry of Education (MOE) and SkillsFuture Singapore (SSG) provide about $400 million a year in direct training subsidies for lifelong learning, with as much as 40% of that going towards supporting individual-initiated training. Sixty percent, the majority, still goes towards supporting companies and employers to train their workers.

Employed Singaporeans' participation rate in structured training is now 62%, higher than the OECD average of 55%. We are higher than Australia, Korea, Japan and France, but we are below US, the UK, Finland and Sweden. Further, based on our surveys in 2014, 82% of surveyed employers provided structured training to their employees, compared to 72% in 2006.

We are therefore not doing badly by international standards, and many companies do take the skills upgrading of their workers very seriously. But we can certainly do better, especially in encouraging SMEs to do so, and for all companies to be more active in offering structured in-house training and apprenticeship schemes, such Enhanced Internships under SkillsFuture, the SkillsFuture Earn and Learn Programme, and the Professional Conversion Programmes under Adapt and Grow.

All these are various measures we take under the SkillsFuture movement. Of course, within the movement, there is one small important scheme and that is the SkillsFuture Credit. It is one of many efforts to under the SkillsFuture movement to promote lifelong learning. We track the utilisation closely and the latest results were just released yesterday and carried widely in the papers. So, as at end December 2016, over 126,000 Singapore Citizens have utilised $37 million worth of the SkillsFuture Credit.

Thank you, Madam. I thank the Minister for his comprehensive response. I have two supplementary questions for him. The first is, I acknowledge the great efforts that Government is making in investing directly in the employees' training but there is a lot of sense on the ground that because Government is doing so much, the part of the employer is missing? I think whilst your statistics do show that they are having programmes, but I think the ground sense is that employers can do a lot of more. I would like to ask the Minister: would the Minister consider requiring companies to set aside specific amounts of funds towards training? Their funds, not Government funds. For example, having a target of 2% of payroll towards training which some countries do, failing which they will need to contribute the same amount towards SkillsFuture account of the Government.

The second question is, whilst SkillsFuture is a national movement for all Singaporeans 25 years and above to pursue lifelong learning, so understandably, it is very wide, but could the Government prioritise SkillsFuture efforts towards helping Singaporeans build new skills necessary for new jobs and prepare for alternative careers by providing differentiated funding and extensive internships opportunities, as well as Place and Train schemes? So, very, very targeted schemes towards getting new jobs and building new skills. Whilst there are other things important but prioritise towards getting new skills for new jobs.

I thank the Member for the supplementary questions. I think to set aside a certain percentage of payroll for training will help me and my officers meet all our KPIs but I think it is a heavy burden for companies.

In fact, we do have something similar. Under Skills Development Levy, every company set aside 0.25% of their payroll for workers up to $4,500 in salary. They pay towards today's SkillsFuture Singapore. That money is pooled together which they can then claim for the training of their workers.

So, in a way, that mechanism is in place. It is levied very lightly at 0.25% but I think we will be very careful not to add further burden.

What I think we should really do is what the Member suggested in her second question − prioritise where are the economic activities, which sectors, which companies are hiring and then put very focused efforts to help workers pick up the skills so that they can take up the new jobs. That is exactly what we are doing together with the Ministry of Manpower.