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SINGAPORE: Parliament on Tuesday saw MPs raising concerns that low-wage workers could be left behind in the long term, as Singapore gears up for a renewed productivity drive.
In restructuring the economy, Members of Parliament (MPs) wanted to know how it will impact the most vulnerable groups - low-wage workers as well as small and medium enterprises.
While "productivity" - the buzzword for the Budget - has been around for a long time, some MPs pointed out many are still not sure what "increasing productivity" really means.
"During a webchat session, one REACH contributor lamented: 'I am wondering where the root of our low productivity problem lies'?" said Dr Amy Khor, MP for Hong Kah GRC.
"It seems that people are working really hard these days and even harder than before. Have our efforts been fruitless? What can we, as individuals, do differently to improve productivity?"
Hence, MPs called to explain clearly what productivity means and what it will lead to.
MP for West Coast GRC Ho Geok Choo replied it means to work smarter, create better jobs, with higher pay but not longer hours.
"In its basic definition, productivity is about more output with fewer resources," said MP for West Coast GRC Ho Geok Choo. "To create an efficient and quality workforce, employers too have to be innovative and find new ways to create value and unlock the potential in each employee.
"It does not mean working longer hours and doing away with older staff. It is about the employer rolling up his sleeves to work together with his employees. Employers are the prime movers of mindset change."
That may all sound good but the reality is, restructuring the economy will have its greatest impact on the most vulnerable.
Opposition MP Low Thia Khiang said the government's fiscal policy is too conservative to make any positive impact on the low-income.
He wanted to know how long low-wage workers will have to wait to enjoy the fruits of productivity and the difference it will make to their pay.
"How long more must our low-wage workers wait to enjoy a first-world pay? Must they wait until our productivity reach two to three per cent?" asked Mr Low. "Low-wage workers have every reason to be concerned with this productivity drive.
"The minister has said the government's goal is to grow productivity by two to three per cent per year over the next decade, only then can real income go up by one-third in 10 years. Does this mean that the government expects low-wage workers to wait another 10 years for something that may not happen as we've witnessed in the last 10 years?
"Low-wage workers cannot afford to go for training after training. If they have some time to spare, they will take on a second job to supplement their meagre income.
"Therefore, the question the government should answer is why, after decades of promoting productivity and skills training and despite the fact that we have achieved five per cent productivity growth in the 1980s and about three per cent in the 1990s, we are back to the same call again?"
Other MPs point out that the Budget should be seen in totality - taking into account other help measures such as enhancements to the Workfare Income Supplement scheme, aimed at boosting the take-home pay for low wage workers; and the new Workfare Training Scheme, aimed at making training for low skilled older workers attractive to both companies and workers even during non-recessionary times.
MP for Bishan-Toa Payoh GRC Josephine Teo suggested that companies share their productivity gains with workers.
"Productivity measures, if implemented correctly, must lead to improved bottomline," she said. "This could be due to increased revenues or cost reductions or both - due to improved efficiency and quality.
"The productivity gains enjoyed by businesses should be shared so that workers are motivated to find even more ways to contribute to productivity improvements.
"Some companies such as SIA Engineering Company, have already introduced such gain-sharing plans and seen good results. Therefore, promoting gain-sharing will ensure greater alignment of interests between businesses and their employees, to further boost the productivity drive."
MPs also spoke up for Small and Medium Enterprises. They said SMEs may face cashflow problems in the immediate future as they seek to enhance their work processes to improve productivity. Coupled with the higher foreign worker levy, smaller companies may be struggling to cope.
As MP for Tampines GRC Sin Boon Ann pointed out: "In choosing to generally force improvements on productivity, we must recognise that our cost of labour and factors of production will necessarily go up, making us more costly relative to other places.
"We went through this path before in the 80s when we decided to increase the unit cost of labour by pushing through measures to increase productivity through automation."
MPs said upfront investments by smaller companies could be offset by the newly-created National Productivity Fund.
The target is to put S$2 billion into this new Fund. For a start, the government will inject $1 billion into the Fund in 2010, which is expected to support initiatives over the next five years.
The key is in ensuring that companies are aware of the various help schemes available and that they have easy access to them.
MP Amy Khor said: "It would be useful for the National Productivity and Continuing Education Council to work with Spring to set up a dedicated one-stop department or centre to help SMEs. There can be no one-size-fits-all solution to improving productivity.
"Sector specific analysis of productivity drivers for each industry and customised solutions to improve productivity and innovation for each sector and company needs to be devised under the facilitation of the Council and the use of the National Productivity Fund."
- CNA/yb
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