Economy & business — Topics

11 Nov 2013

Employers' CPF Contributions for Workers Age 50 and Above

The Acting Minister for Manpower explained that the reduced CPF contributions for workers aged 50 to 55 were initially introduced in 2005-2006 to improve their employability in a seniority-based wage system.
With improved employment rates and wage restructuring for older workers, the government in 2012 agreed with tripartite partners to eventually restore their CPF contributions to match younger workers.
The CPF rate for workers aged 50 to 55 was raised by 2.5 percentage points in September last year, and the government will monitor conditions before taking further steps to balance employee take-home pay and employer costs.

Summary written by AI

Overview Original source

11 Nov 2013

Encouraging Best Sourcing Practices

The Ministry promotes best sourcing through Tripartite Advisory and implementation guides, with training modules for procurement officers and funding grants of up to $150,000 to help companies adopt these practices.
Accreditation schemes like NEA's Clean Mark and security grading exercises are used to identify higher-quality service providers, with government agencies committing to procure only from accredited or well-graded companies.
Best sourcing aims to improve service quality, worker welfare, and wage standards, especially for low-wage workers, while discouraging practices that depress wages through cheap sourcing.

Summary written by AI

Overview Original source

11 Nov 2013

Impact of Car Leasing on COE Prices

Zaqy Mohamad asked whether the Ministry studied how car leasing affects COE prices, as it may be used to bypass recent car loan restrictions.
Lui Tuck Yew stated the Government monitors the car leasing market and noted private hire cars made up 6.9% of new registrations since loan restrictions, up from 4.7% last year and 5.6% in 2011.
He concluded that the moderate growth in car leasing is unlikely to have significantly impacted COE prices.

Summary written by AI

Overview Original source

11 Nov 2013

Impact of Free Trade Talks and Agreements on Singapore

Assoc Prof Tan Kheng Boon Eugene asked for an update on WTO talks and Singapore’s position after the failed Doha round, how FTAs complement and undermine the WTO, and what support exists for local businesses to benefit from FTAs.
Lim Hng Kiang noted that the WTO’s Doha Development Agenda faces challenges, but members are focused on trade facilitation, agriculture, and development, with hopes for progress at the Bali Ministerial Conference.
He emphasized that the WTO provides a rules-based trading system and monitors protectionism, while FTAs serve as building blocks that support global trade liberalization.
Singapore has 20 FTAs in force, and IE Singapore promotes FTA use through seminars, workshops, a Certificate Programme, and free consultations to help businesses.
MTI and IE Singapore gather company feedback to ensure FTAs remain relevant and useful for the business community.

Summary written by AI

Overview Original source

11 Nov 2013

Impact of Tightened Foreign Worker Quotas on SMEs

The government has tightened foreign worker quotas since 2010 to shift towards a more manpower-lean economy, but has received 19,000 appeals from SMEs for pass renewals, approving about 48% with temporary concessions to aid their transition.
SMEs make up 99% of enterprises and contribute significantly to employment and GDP, prompting active engagement to address their manpower challenges and rising costs.
To help SMEs retain experienced foreign workers, the government introduced a market-based skills framework in 2013, allowing certain work permit holders to gain skilled status and stay longer while reducing levy costs.
Despite tighter foreign worker restrictions, many SMEs have expanded overseas, with over half reporting overseas revenue in 2012, showing continued growth opportunities.

Summary written by AI

Overview Original source

11 Nov 2013

Wage Increase Requirement in Government Contracts

Deputy Prime Minister Tharman Shanmugaratnam confirmed that since July, MOF has required government agencies to instruct contractors to follow National Wage Council (NWC) recommendations on wage increments for outsourced services and to factor expected wage increases into their tender bids.
For multi-year contracts, contractors are encouraged to provide a year-by-year breakdown of their bid price to reflect anticipated wage growth over the contract period.
The government supports applying NWC recommendations to wage adjustments in sectors with a Progressive Wage Model, such as cleaning, and is working to extend this approach to the security sector through a tripartite committee.
The government aims to promote sustainable wage progression for low-wage workers across outsourced government contracts by working with tripartite partners.
This policy ensures that wage increments are considered in government procurement, aligning with national wage recommendations for low-wage workers.

Summary written by AI

Overview Original source

11 Nov 2013

Contestability in Public Transport Sector

The Government is introducing the New Rail Financing Framework to lower barriers to entry and enhance contestability in the rail industry, with plans to eventually transition existing operators to this model.
Competitive tendering is being tested for bus services like City Direct and Peak Period Short routes to improve service levels and consider larger-scale implementation in the future.
These initiatives aim to deliver better service and more equitable fares by allowing the government to select operators based on cost-competitiveness and service specifications.

Summary written by AI

Overview Original source

11 Nov 2013

Unemployment in Singapore's Resident Population

Jessica Tan asked whether rising resident unemployment would continue through 2013 and how economic restructuring has affected jobs and PME wages and opportunities.
Minister Tan Chuan-Jin explained that restructuring aims for productivity-led growth, which may temporarily displace some jobs but creates new ones, with overall employment growing between 2010 and 2013.
He noted that PME median wages grew faster than average, but the supply of graduates increased, reducing vacancies for degree holders from 112 to 92 per 100 seekers between 2010 and 2012.
The minister said unemployment may rise slightly but remain low due to a tight labor market, with support for displaced workers through skills training and job-matching services.

Summary written by AI

Overview Original source

11 Nov 2013

Requirements and Extension of Productivity and Innovation Credit Scheme

Er Dr Lee Bee Wah questioned if the Ministry would waive the requirement of having at least three local employees to qualify for the PIC Bonus and extend the PIC Scheme beyond 2015.
Tharman Shanmugaratnam explained that the three-local-employee requirement applies only to the PIC Bonus and cash payout to prevent abuse, while the 400% PIC tax deduction has no such restriction.
Businesses with fewer than three local employees can still benefit from the PIC tax deduction and other grant schemes like SPRING's ICV and e2i's IGP.
The Ministry is reviewing the PIC scheme's utilization, effectiveness, and business feedback to decide on an extension beyond 2015.

Summary written by AI

Overview Original source

11 Nov 2013

Impact of Currency Fluctuations on Singapore's Economy

Minister Lim Hng Kiang noted that the potential tapering of US quantitative easing has caused currency volatility across the region, but Singapore's trade-weighted exchange rate remains within its policy band and markets are functioning normally.
He emphasized that while regional currency depreciation poses concerns, the exchange rate is a tool for price stability, not export competitiveness, and long-term competitiveness will be pursued through economic restructuring and productivity improvements.
The Minister assessed that the overall impact on Singapore's economy, including unemployment, is likely to be limited, though risks remain if the US tapering leads to disorderly market reactions or a sharp slowdown in US growth.

Summary written by AI

Overview Original source

11 Nov 2013

MOU signed at Recent China-Singapore Joint Council for Bilateral Cooperation Meeting

Singapore SMEs can benefit from the MOU by accessing China's large services market, with agencies supporting expansion through business missions, matching, and grants, including participation in the CIFTIS platform.
Collaboration in science and technology at the Suzhou Industrial Park will provide stronger support for commercializing innovations, particularly aiding start-ups in tapping China's mass market.
Smart city solutions in areas like transportation, education, and environment will be developed in pilot cities like Suzhou, offering SMEs opportunities to provide expertise in ICT, urban planning, and transport.
Cooperation in the Tianjin Eco-City and other projects serves as a model for sustainable development, with over 300 SMEs already engaged through missions and business matching.
Singapore and Chinese companies will partner in third markets like Africa and Southeast Asia for joint infrastructure ventures, industrial parks, and financing, benefiting SMEs in growth sectors such as infrastructure and energy.

Summary written by AI

Overview Original source

11 Nov 2013

Central Provident Fund (Amendment) Bill

The Bill amends the CPF Act to increase penalties for employer non-compliance, including higher fines, minimum fines, and jail terms for repeat offenders, and expands the powers of CPF Board inspectors to obtain documents from any person connected to employment during investigations.
It introduces greater flexibility for CPF members above 55 to make more than one withdrawal within a birthday year, subject to existing withdrawal rules, and updates pledging rules to allow private property jointly owned with non-relatives to be pledged.
The amendments close defunct schemes like the Minimum Sum Bank Deposit Scheme and Minimum Sum Plus Scheme, and include technical changes to streamline CPF administration.

Summary written by AI

Overview Original source

11 Nov 2013

Goods and Services Tax (Amendment) Bill

The Bill introduces seven amendments to the Goods and Services Tax Act, with five arising from a system review and two aimed at facilitating IRAS administration, following a public consultation process.
Key changes empower the Comptroller of GST to seize goods and arrest persons for fraudulent Tourist Refund Scheme claims, and allow IRAS to disclose anonymized taxpayer data for statistical research and share information on professional misconduct with relevant bodies.
Administrative facilitations include transferring GST obligations for imported goods, specifying repayment responsibility for non-compliance with GST schemes, and clarifying the definition of "refine" for precious metals in specific schemes.
The amendments also enable IRAS to share information with law enforcement for money laundering investigations and deduct tax arrears from government payments like the Wage Credit Scheme, extending these provisions to other IRAS-administered Acts.

Summary written by AI

Overview Original source

11 Nov 2013

Regulation of Imports and Exports (Amendment) Bill

The Regulation of Imports and Exports (Amendment) Bill aims to amend the primary Act and make consequential changes to the Customs Act to update trade regulations.
The Bill was presented by the Second Minister for Trade and Industry, Mr S Iswaran, and received its First Reading in Parliament.
The Second Reading of the Bill is scheduled for the next available sitting of Parliament, and the document will be printed for further review.

Summary written by AI

Overview Original source

11 Nov 2013

Fire at Bukit Panjang Telecommunications Exchange

The Minister confirmed that the IDA is investigating the Bukit Panjang fire, focusing on its cause, avoidability, operator response, and measures to prevent recurrence, while noting that a second fully diversified network would be prohibitively expensive.
The government outlined a resilience strategy based on diversity, resistance, redundancy, and recovery, with existing resiliency codes and penalties for operators, and plans to implement an audit framework for mobile networks by next year.
Businesses and consumers are advised to work with telecom providers to adopt tailored resilience strategies, such as path diversity or using multiple operators, rather than relying on a one-size-fits-all service tier.
The Minister clarified that the sale of OpenNet is unrelated to the incident, and IDA will assess the consolidation application based on competition and public interest criteria, considering feedback from industry stakeholders.
Follow-up questions highlighted the need for regular resilience exercises, the inclusion of all operators in audits, and whether stricter requirements are warranted given Singapore’s heavy dependence on telecom infrastructure, with the Minister affirming a balanced, proactive audit approach.

Summary written by AI

Overview Original source

11 Nov 2013

Criteria for Government Subsidies and Assistance Schemes

The Minister explained that government subsidies and assistance schemes use multiple eligibility criteria tailored to different needs, with broader subsidies for essential areas like housing and healthcare and targeted help for low-income groups through schemes like ComCare and Workfare.
Eligibility thresholds, such as the $550 per capita income cap for ComCare, are reviewed regularly based on factors like household size, medical conditions, and market conditions, with flexibility to assist those who may not meet strict criteria but are in genuine need.
The government is improving communication and accessibility of schemes, expanding Social Service Offices and Family Service Centres, and relying on volunteers and grassroots partners to reach needy families, though challenges like the "cliff effect" and sustainable funding remain concerns.

Summary written by AI

Overview Original source

11 Nov 2013

Keeping Transport Fares Affordable

The government accepted the Fare Review Mechanism Committee’s recommendations to implement a new fare formula and two new concession schemes for low-income workers and persons with disabilities, with discounts set to offset the next fare increase for these groups.
Public transport fares are expected to increase in 2014, but the Transport Minister urged the Public Transport Council to ensure any rise does not exceed the 2013 average national wage increase to maintain affordability for average commuters.
Service quality improvements are being addressed separately from the fare formula, with plans to add buses and trains and enhance regulatory standards to boost public transport reliability and capacity.
The Public Transport Fund will be strengthened with contributions from transport operators, allowing for more transport vouchers and support for needy households, with outreach efforts emphasized to ensure all eligible commuters benefit.

Summary written by AI

Overview Original source

21 Oct 2013

CPF Savings of Self-employed Persons

Acting Minister Tan Chuan-Jin highlighted that self-employed persons (SEPs) are required to contribute to their MediSave Accounts, with median balances increasing steadily from $12,000 in 2008 to $18,000 in 2012.
The Drive and Save Scheme for taxi drivers, offering dollar-for-dollar matching from companies, has seen success with 17,000 drivers benefiting from $5.9 million in co-contributions between 2011 and 2012, and average annual contributions rising from $660 to $940.
The government encourages industry-led initiatives and provides support through measures like Workfare Income Supplement and MediSave top-ups, with WIS payouts increased in 2013 and higher contribution rates for low-income SEPs from 2014.
The Minister assured that the government will ensure affordability of MediShield Life premiums for lower-income Singaporeans, while emphasizing personal responsibility for SEPs to save for healthcare needs.

Summary written by AI

Overview Original source

21 Oct 2013

Annual Government Expenditure on Education vis-a-vis OECD Average

The Minister stated that Singapore's education expenditure has risen by 40% over five years, reaching $10.5 billion in FY2012, which is 3.1% of GDP and over 20% of total government spending.
While OECD countries spend 4-7% of GDP on education, they allocate only about 13% of their government expenditure to it, significantly less than Singapore's proportion.
The Minister emphasized that educational outcomes, such as Singapore's top PISA rankings in 2009, matter more than expenditure levels, attributing success to teacher quality and resource deployment.
Over 95% of Singapore students advance to post-secondary education, reflecting strong foundations from basic education despite lower GDP spending compared to some high-performing countries.

Summary written by AI

Overview Original source

21 Oct 2013

MediShield Premiums Collected and Claims Paid in Last Five Fiscal Years

Between 2008 and 2012, MediShield claims paid annually doubled while premiums collected increased by about 40%, with a detailed table showing premiums, claims, and required reserve changes for that period.
Claims are expected to rise further due to population aging and the expansion of coverage to psychiatric, congenital, and neonatal conditions from March 2013.
MediShield is a not-for-profit, self-sustaining scheme where premiums are actuarially set to cover current and future liabilities, including claims and premium rebates, and reserves are maintained per MAS Risk-Based Capital requirements to ensure solvency.

Summary written by AI

Overview Original source