Committee of Supply (Speech 1) by Mr Gan Kim Yong, Minister for Manpower, 11 March 2010, 12:30 PM, Parliament

Mr Gan Kim Yong, Minister for Manpower, Parliament

UPGRADING SKILLS, RAISING PRODUCTIVITY

(I)  RESILIENCE OF LABOUR MARKET DURING THE DOWNTURN

(A)  Labour Market Update

1.   Allow me to first give an overview of the state of the labour market.  2009 was a challenging year.  It began with a sharp contraction in the global economy.  Many countries suffered unprecedented job losses.  The International Labour Organisation (ILO) estimates that over 20 million jobs have been lost since the onset of the economic crisis. 

2.   In Singapore, we were affected by the global downturn as well.  13,800 jobs were lost in the first two quarters of 2009 and unemployment rate reached 3.4% in September 2009, the highest in five years.  Nevertheless, our labour market stayed resilient despite falling external demand and uncertainties in the economic outlook.  During the 1997/98 Asian financial crisis, we lost 42,100 jobs.  During the 2001 economic downturn, we lost 79,500 jobs following the dot-com bust and September 11.  In 2009 however, a total of 38,800 jobs were created for the whole of the year due to the recovery of the labour market in the second half, which had more than offset the job losses in the first half.  For the first time, Singapore experienced employment growth amidst an economic recession.   

3.   For the whole of 2009, there were 22,700 redundancies, significantly lower than previous peaks in 1998 and 2001.  The overall unemployment rate eased to 2.1% in December last year, lower than that in many other economies. In the US, for example, unemployment rate was 10% in December last year.  In the EU, unemployment rate likewise rose to nearly 10% by the end of 2009.

5.   While the overall employment rate of the resident population aged 25 to 64 declined from the peak of 77% in 2008 to 75.8% in 2009 due to the economic slowdown, I am encouraged that the employment rate of older residents remained at the record high of 57.2%. 

(B)  Impact of Downturn Measures

6.   The better-than-expected performance of our labour market can be attributed to the coordinated efforts by our tripartite partners to save jobs, complemented by key initiatives such as the Jobs Credit scheme and Skills Programme for Upgrading and Resilience, or SPUR.  Since the inception of SPUR in Nov 2008, 204,000 workers have completed or are undergoing SPUR training at the moment.

7.   We also beefed up our career centres in response to the recession.  The career centres at the CDCs and NTUC’s Employment and Employability Institute (e2i) placed about 47,600 unemployed into jobs from Dec 2008 to Jan this year. 

8.   On the future of SPUR which ends in Nov 2010, my Ministry is reviewing this and will announce the details in due course. But I can assure the house that training remains affordable.  We will retain those programmes that are still relevant beyond the recession, such as programmes that address critical skills needs.

9.   I strongly encourage employers to continue tapping on SPUR and the various Government support to re-skill, up-skill or multi-skill their workers as part of their companies' long-term strategy.

(C) Success of Measures Attributed to Strong Tripartite Cooperation

10.   We have managed the downturn well and avoided massive job losses largely because of the collective effort of the tripartite partners.  The close relationship among the Government, employers and unions enabled us to come together and act swiftly to help companies stay viable, cut costs and save jobs during this difficult period.  This would not have been possible without the high level of trust, cooperation and shared purpose underpinning this strategic partnership.  We should continue to strengthen this partnership, through formal platforms like the Singapore Tripartism Forum and informal trust-building at all levels – tripartite leaders and rank-and-file members.  Indeed, we have come a long way in building strong tripartite cooperation. A Member had asked about Convention 144 and 122 of the ILO. We are reviewing them and will consider ratifications in due course after consulting with tripartite partners.  The recently released General Survey on Employment by the International Labour Organisation highlighted Singapore as a positive example of how tripartism played an important role in driving long-term initiatives and managing shorter-term priorities such as the economic downturn.

(II) FORGING AHEAD FOR THE UPTURN

11.   Going into 2010, our economy is projected to grow by 4.5% to 6.5%.  In tandem with the economic turnaround, hiring sentiments have also improved.  We expect the number of jobs created this year to exceed that of last year.  There will be jobs available for both rank-and-file workers and PMETs in various sectors of the economy, such as financial services, retail and F&B, biomedical sciences, IT and security.

12.   However, we have to bear in mind that employment growth typically lags recovery.  In Singapore, many employers have heeded our call to hold on to excess workers during the downturn.  These are the workers that companies are likely to tap on before they start to recruit more workers.  With better job prospects, the pool of job seekers may rise as more are encouraged to return to work, including those who have just completed their training.  Nevertheless, barring new shocks to the economy, we can expect the labour market to remain stable for the rest of the year. 

13.   As the recovery picks up momentum, employers should review whether measures taken during the downturn should be phased out, taking into account the business outlook. 

(III) RAISING LABOUR PRODUCTIVITY

14.   As our economy emerges from the recession, we need to review our economic strategy in response to fundamental changes in the global landscape. We need to make a strategic shift to achieve sustainable and inclusive economic growth through productivity improvement.  

15.   Chairman of the National Productivity and Continuing Education Council, DPM Teo Chee Hean, has outlined key initiatives that the Government will take to accelerate enterprise productivity and raise the capabilities of our entire workforce. A Member had also asked if the Council would include educational professionals. We are still finalising the composition, and the composition will ensure we have broad representation.

(A)  Deepening Workforce Capabilities Through CET

An Evolving CET landscape

16.   Continuing Education and Training, or CET, is the key driver to up-skill the workforce.  Since the formation of the Workforce Development Agency (WDA) in 2003 and the launch of the CET Masterplan in 2008, we have made significant progress in expanding the training programmes and infrastructure of the national CET system. 

17.   We now have a national training framework – the Workforce Skills Qualification (WSQ) system – with different levels that cater to the different training needs of our adult workers.  This starts with Employability Skills (ES) that equip workers with basic, portable skills like numeracy, literacy and communications.  Workers without basic academic qualifications such as "O" levels can also be assessed for their workplace literacy and numeracy so that they can secure better jobs and pursue further upgrading. 

18.   The next level is WSQ vocational skills which establish structured skills progression pathways in key growth industries. These are based on competencies that companies are looking for. For example in retail, retail associates can enrol in the WSQ Certificate in Retail Operations to improve their sales and service skills, and take up WSQ Advanced Certificate in Retail Supervision when they move on to a supervisory position.  They can further enrol in the WSQ Diploma in Retail Management to improve their managerial skills if they are promoted to retail or store manager.  WSQ now covers 24 areas such as aerospace, wafer fabrication, security, digital animation, community and social services and tourism. 

19.   Although WSQ was launched only in 2003, we have achieved some success.  A 2009 WDA survey showed that more than one-third of surveyed companies were aware of either WSQ, ES or both.  The Civil Service has been recognising ES since 2007 and includes ES programmes as part of its core training framework.  We will continue to build on this, just like how the education system was built up over several decades.

20.   Apart from WSQ programmes, the Government also supports CET courses that fill gaps in the CET landscape and are relevant to the industry. These programmes may be conducted by our institutions of higher learning or other training institutions recognised by industry.  For example, we fund Nanyang Polytechnic and Ngee Ann Polytechnic's CET diploma courses in nursing and allied health.  The Centre for Urban Greenery and Ecology (CUGE) offers professional courses to train certified arborists and horticulturists for the landscape industry.  In some instances, what started out as non-WSQ courses eventually became aligned to WSQ.

21.   Apart from training courses, we also introduced various programmes to address specific issues of structural unemployment and skills mismatch.  For example, we introduced the Place-and-Train programme to better match job seekers with employers, and the Professional Conversion Programme to help PMETs acquire new skills or to make a career switch into growth sectors. 

22.   To support the various training programmes that we introduced, we have built up a comprehensive infrastructure for adult learning.  Starting at the basic level, we have public and private service providers of non-WSQ courses that are funded by the Skills Development Fund.  Next, we have about 450 approved training providers, including in-house training facilities, which provide WSQ courses to cater to industry needs. 

23.   In recent years, we established a network of CET centres which go beyond offering WSQ courses to champion national skills standards, develop curriculum, engage the industry to understand their needs and provide career services to workers.  We now have nearly 50 CET centres, up from just 19 in 2007.  These include our polytechnics, ITE and the private sector institutions. 

24.   In 2009, three of our CET centres were awarded the status of National CET Institutes (NCIs) in recognition of the high quality of training they provide.  NCIs are expected to lead the way in developing innovative methods of adult training, responding to skills gaps and providing a holistic solution to workforce development initiatives in their respective sectors.   

25.   On top of training providers, tripartite partners came together to set up the Employment and Employability Institute (e2i) to help job seekers and workers assess their employability gaps and upgrade their skills.

26.   The entire CET system was put to a test during the economic downturn – in 2009, more than 200,000 workers were trained under the WSQ system, which is about the same number of workers trained over the previous 5 years combined.

27.   Going forward, the Government will invest $2.5 billion in CET over the next five years.  We will reinforce the four key components of our CET system – skills standards, quality of training providers and trainers, career services and physical infrastructure.  We will expand our programmes and reach out to help all workers, both rank-and-file and PMETs, to upgrade their capability and pioneer new approaches in CET, so as to create a highly skilled workforce.

Industry-Driven, Adult-Centric, Outcome-Based CET

28.   Three key principles will underpin our CET system - industry-driven, adult-centric and outcome-based. 

29.   CET skills standards and courses will be developed with strong industry input through our Industry Skills and Training Councils.  This way, we ensure that our CET system will equip workers with portable and relevant skills that are recognised and valued by employers.

30.    Our programmes will be learner-centric, with courses that are short, modular and practice-oriented in order to cater to the learning patterns of adult workers. WDA set up the Institute for Adult Learning (IAL) in 2008 to carry out research and build knowledge in adult pedagogy. IAL will also train our adult trainers to raise their quality and professionalism. 
 
31.   CET must also be driven by outcomes.  It must make a positive impact on companies and workers.  A recent survey by WDA showed that more than 60% of companies reported improvement in work productivity as a result of training.  More than 90% of trainees applied the skills they had learnt with better work performance, and 45% of trainees took on more or new job responsibilities after the training.

New Investments for a New Phase of the CET System

32.   Let me now turn to the key changes to our CET system. 

Expanding the Scope of CET

33.   First, we want to maximise the skills and potential of every worker – men and women, young and old, rank-and-file and PMETs.  We will therefore expand the scope of the CET system to serve a wider range of workers. 

34.   PMETs now make up more than half of our resident workforce and their share will continue to grow as the quality of our workforce improves.  We need to expand our CET system to cater to them.  My Minister of State will elaborate on this later.

35.   The CET system will also need to cater for the 197,000 contract and casual workers in Singapore. On My Senior Parliamentary Secretary will elaborate on how we intend to help them.  Let me just give an example.  The landscape sector has many contract workers.  Gardeners used to earn monthly salaries of around $850.  Through the Job Re-creation Programme, these gardeners have now enlarged their job roles.  Our CET system provides courses such as the WSQ Certificate in Landscape Operations and courses in niche areas such as chainsaw operations.  As a result, landscape workers now earn higher gross monthly wages of between $1,000 to $1,300 and enjoy better working conditions.  Landscape companies also benefit from lower worker turnover and higher productivity. Contract and casual workers can also benefit from the Workfare Training Scheme (WTS) that the Minister of Finance announced during the Budget Statement.  I will elaborate on WTS later.

New Pathways and Cross Linkages

36.   Second, we will build more pathways and cross linkages between Pre-Employment Training (PET) and CET. We will study other countries’ models, which will involve European countries as well such as Denmark and Finland. They have a very well-developed system and we can learn from them but we must bear in mind that they took decades to come to where they are today.  We have started building such bridges by mutually recognising learning achievements from both systems.  For example, ITE graduates from 7 disciplines such as Retail, F&B and Tourism, can seek credit exemption when pursing a WSQ certification or upgrading to the WSQ Diploma level, and vice versa.  This means that ITE graduates will have more choices in pursuing further education and training.  They can now choose to enrol in a polytechnic, take up a technical diploma offered by ITE, or enter a CET centre to obtain a WSQ Diploma, depending on the area that they are interested in.  Another example is the Diploma in Horticulture & Landscape Architecture from Ngee Ann Polytechnic that has incorporated the WSQ Certificate in Landscape Operations in the programme in collaboration with the Centre for Urban Greenery and Ecology, a CET centre for the landscape industry.
 
37.   Ms Benjamin Sharmi Santhana Mary, for example, was able to use her NITEC Certificate in Digital Animation to enrol in the Egg Story Digital Arts School.  She recently graduated with a WSQ Diploma in Animation and has received many job offers.

38.   In another example, Ms Irene Lim was able to use her WSQ Diploma in Retail Management to successfully apply for the Bachelor in Marketing in UniSIM after failing to do so earlier when she had only 'O' level and partial 'A' level qualifications.  Ms Lim has since graduated from UniSIM and is now working as a manager in charge of product development and sales at Tensai Pte Ltd. 

39.   We will build more linkages and pathways so that more people like Ms Sharmi and Ms Lim can benefit. 

Raising the Quality of the WSQ System

40.   A third thrust moving forward is to enhance the quality of our CET providers and trainers. 

41.   Today, we have in place a quality assurance system for WSQ training providers.  All training providers conducting WSQ courses must first be accredited by WDA to ensure that they meet the pre-requisite standards. 

42.   We will progressively raise the required standards to ensure that the quality of our training providers meets the rising expectations of employers and workers.

43.   To add diversity and further raise the overall standard of our training providers, WDA will bring in best-in-class institutions, in partnership with local CET centres where appropriate.  These institutions can complement our local providers by offering training in specialised skills sets and raising the quality bar.  Some of them are already here in Singapore. These include DigiPen Institute of Technology for game design, Box Hill Institute for community and social services, and the University of Nevada Las Vegas for tourism and hospitality. 
 
44.   More recently, NTUC's LearningHub has linked up with the Fashion Institute of Technology at the State University of New York.  WDA is also collaborating with Siemens Technik Akademie Berlin, a leader in Mechatronics engineering, to deliver a series of WSQ Mechatronics Systems Certification programmes that will deepen the technical competencies of our workforce in industries such as precision engineering, medical technology and marine.  A total of 500 trainees are expected to benefit from this collaboration.

45.   We will also need to raise the quality of CET professionals, especially adult educators.  Over the past year, around 1,400 trainers have obtained the WSQ Advanced Certificate in Training and Assessment (ACTA). 

Capability-building Pathway for CET Professionals

46.   Moving forward, we will further our efforts in two areas.  First, to cater to the differing needs of CET professionals, we will move beyond ACTA to provide a full range of capability building programmes and an upgrading pathway for CET professionals.  IAL will be introducing a suite of courses including a Diploma in Adult and Continuing Education to deepen the skills of adult educators in specific areas such as curriculum design and a Masters Degree in Lifelong Learning in collaboration with the University of London. 

47.   Second, we will develop deeper expertise among other CET practitioners such as curriculum and assessment developers, assessors and administrators of training providers.  By 2011, two more programmes will be added – a Specialist Diploma in Training Management and a Graduate Diploma programme for leaders of CET institutions.

Research and Innovation Fund for CET Research

48.   To encourage and support ground-up research projects as well as experiments and pilots of new CET approaches, WDA will launch a $3 million Research and Innovation Fund.  This is on top of the $2 million that has already been earmarked for IAL to provide research grants and pursue collaborative research projects.  The Fund will support efforts in areas such as curriculum design, training methodology and use of learning technology.  Details of the grant scheme will be announced later.

Making CET Accessible

49.   Next, we will make CET even more accessible to workers.  We will develop new career services and find new ways of reaching out to workers to encourage them to go for training and facilitate their access to the CET system. 

50.   WDA is working on an online integrated database where an individual can view his personal training records and skills pathways.  This will make it easier for an individual to search for related WSQ training and find out more about courses that are relevant to his skills pathway.  He can also use this system to search for jobs that match his skills and the training he has undergone.  The system is scheduled for implementation next year.

51.   Let me assure that CET will always remain affordable to workers.  Today, courses under the CET system are already heavily subsidised by the Government, with up to 90% of course fees subsidised under SPUR. 

Update on CET Campuses

52.   To bring our CET system to the next level, we will develop two CET Campuses by 2013 at Paya Lebar Central and Jurong Lake District.  When ready, the two CET Campuses will deliver a total of 150,000 training places and train up to 50,000 workers annually.  Within each CET Campus, we will bring together training providers of related sectors so that they can benefit from resource sharing and the collective expertise of the CET community.  As our economy evolves, we can also expect the focus and clusters covered by the Campuses to also evolve. 

53.   WDA recently signed a Memorandum of Understanding with NTUC's e2i to operate and manage the West Campus.  WDA itself will operate the East Campus. Through this collaboration with NTUC, we hope to make CET even more accessible.

54.   With the CET campuses, workers can go to the same campus to take different courses in related fields.  For example, a person working in the hotel industry may want to take courses in service excellence, F&B service and hotel front service so that he can be multi-skilled.  Currently, he might have to go to different training providers at different locations.  With the setting up of the CET Campuses, we will bring together all these training providers under one roof.  He can undergo training in all three areas in one location.
 
55.   Similarly, an employer can customise courses by combining modules from different training providers located in the same CET Campus for his employees. This creates greater value and improves productivity in training. Employers can also tap the career services available at the CET Campuses to recruit workers.

56.   You can think of the CET Campuses like a medical hub, where specialists providing different medical services such as laboratory testing, where specialist doctors such as cardiologists are grouped under one roof.  They work together to provide comprehensive services to their patients. They can also share common services such as operating theatres. Similarly, the CET Campuses will have clusters of related training providers working in tandem and tapping on common facilities to provide a holistic learning experience for our adult workers. Like the health screening centres at medical hubs, the career centres at the CET Campuses too can provide holistic screening and advice to trainees and employers on what courses are most suitable for them. 
 
Leveraging on CET to Support Productivity Drive

57.   I have described so far how CET will form the foundation to make our workers better skilled, and therefore more productive.  So how do we intend to build up productivity knowledge and develop the productivity DNA in our workforce?  

58.   First, let me highlight that each enterprise and every worker must take responsibility for developing the productivity DNA in their workplace and proactively improving the productivity in their own areas of responsibility.  Nonetheless, we recognise that companies may need some assistance in getting started on improving their productivity.  They can leverage on the suite of capability development programmes that SPRING provides.  Enterprises can also call upon SPRING’s Centres of Innovation for technology consultancy and advice. 

59.   At present, there are many business consultants in the private sector, though only some have specific productivity expertise.  We anticipate that there will be greater demand for more productivity managers and consultants who can help drive overall productivity efforts at the enterprise level.  SPRING has approached the Singapore Productivity Association to launch a revamped Certified Productivity Practitioners Programme in April this year to cater to this need.  WDA is also working with the Singapore Manufacturers' Federation to develop a WSQ Certified Productivity and Innovation Manager programme in the second quarter of this year to help enterprises in the Manufacturing sector raise productivity and pursue business innovation.

60.   We will roll out productivity-related skills training programmes for employers and workers.  Some Members have rightly pointed out that this should include the CEOs with training suited to their needs.  We will work with industry partners such as industry associations, training institutions and business consultants to help enterprises understand productivity concepts and implement global best practices.  WDA has started discussions with the Singapore Productivity Association, the Logistics Institute Asia Pacific and Georgia University of Technology in this regard.

61.   We need to grow a culture of life-long learning so that workers will be motivated to re-skill themselves throughout the course of their working lives.  I am therefore encouraged that more than 85% of WSQ trainees surveyed in 2009 indicated that they would continue to take up WSQ training in future.  We will capitalise on this strong interest in CET and work closely with industry, unions, community groups and other government agencies to sustain the momentum of our CET efforts.

62.   Let me illustrate with a story of how CET has benefited both individuals and companies.

63.   Ms Jasmine Tan is a senior restaurant manager at Yoshinoya who excels in both professional and horizontal skills.  Even though Ms Tan has been working in the F&B industry for the past 7 years, she is keen to pick up new skills.  Ms Tan has undergone Yoshinoya's in-house training programmes and attended a variety of WSQ courses.  She is now expanding her horizontal skills by starting on the WSQ Diploma in F&B Management at the University of Nevada Las Vegas.  Ms Tan is not only a keen learner herself – she is also passionate about helping others upgrade too.  When Yoshinoya achieved the Certified On-Job-Training Centre status, Ms Tan was appointed as an On-Job-Training Instructor by ITE.  She has since helped Yoshinoya grow by training crew members and new managers.  For her excellent efforts in providing a holistic customer experience, Ms Tan was recently nominated as a finalist in the inaugural Singapore Experience Awards 2009.  Both Yoshinoya and Ms Tan are winners as a result of CET.

(B) Optimising Allocation and Improving Quality of Foreign Workforce

64.   Let me now move on to the foreign workforce. As part of the efforts towards productivity-driven growth, my Ministry has announced earlier that we will adjust the levy rates and levy tiers for Work Permit and S Pass holders come 1 Jul 2010.  These changes have three key features.  First, we will increase the levy rates for Work Permit and S Pass holders to moderate employers' demand for foreign manpower and to encourage investment in productivity.  Second, there will be no change in Dependency Ratios across all sectors, but we will adjust the levy tiers so that companies with higher dependency on foreign workers will pay higher levy rates.  I have explained last week how this works.  The levy tiers will allow growth companies to continue to have access to foreign workers but encourage employers to improve their productivity and reduce their reliance on foreign workers.  Third, we will further differentiate the levy rates between the skilled and unskilled Work Permit holders to encourage companies that need foreign workers to employ better skilled and thereby more productive ones. 

65.   The changes will be implemented gradually and in steps between 1 July 2010 and 1 July 2012 to give companies sufficient time to adjust and invest in measures to boost productivity.  We will be briefing the industries on the details of the changes.  I have circulated a factsheet that summarises the changes to Members as well. Madam Halimah was concerned about errant employers who may exploit their foreign workers as a result. MOM will monitor and step up enforcement efforts against errant employers.

66.   A Member expressed concern that a company's levy bill will increase by a significant proportion as a result of these changes and the company may pass on the costs to consumers.  Let me put things in perspective – the levy adjustment to be effected on 1 Jul this year represents an average of less than half a percent of the overall wage bill.  If companies are able to improve their productivity and reduce dependence on foreign workers, the cost impact on them will be lower and in some cases, companies may have net savings, especially if they tap on the various schemes announced by the Minister of Finance earlier.

67.   As we work to reduce our dependence on foreign workers, it does not mean that Singapore no longer welcomes global talent.  Singapore can ill afford to turn its back on talent, local or foreign.  We need them to realise and even expand our economic potential and thereby create good jobs for all Singaporeans.  We need to ensure that Singapore continues to be able to compete with other economies to retain local talent and attract global talent.  We will continue to deepen our engagement with both local and foreign talent who want to establish and grow their careers in Singapore.  Indeed, we have found that some of our foreign talent have not only contributed economically to Singapore, they have also made significant contributions in other ways.

68.   Dr Law Wei Seng, a Malaysian who came to Singapore on an ASEAN scholarship in 1991, is now a PR and works as a Consultant at KK Women's and Children's Hospital.  Apart from his professional work, he has taken part in a number of medical missions to disaster areas such as the Aceh tsunami area and the earthquake zone in Padang.  For his valiant efforts, Dr Law has received two Ministry of Health awards.  We are proud to have global talent like Dr Law amongst us.

69.   Local talent are important to us too.  MOM has reached out to overseas Singaporeans by tapping upon the global networks created through Contact Singapore's worldwide offices to keep them connected to their homeland.  In 2009, Contact Singapore organised about 200 information sharing and networking sessions with overseas Singaporean communities to update them on the latest industry developments and career opportunities available in Singapore.

70.   Mr Steven Ong is one local talent who has returned to Singapore. After graduating with a Diploma in Film, Sound and Video from Ngee Ann Polytechnic, Mr Ong moved to the US to work in the visual effects industry.  After spending several years abroad, he returned to Singapore in Oct last year and brought with him many years of experience working on feature films such as Night at the Museum 2 and Spider Man 3.  He is now the Lead Digital Artist at Lucasfilm Animation Singapore.

71.   As we seek to attract both local and foreign talent, we need to raise the quality of the foreign workforce.  We have already implemented some initiatives to address this.  In June last year, we raised the S Pass criteria so that only more qualified, skilled and experienced applicants are eligible.  From Jul 2010, Work Permit holders in the Hotel, Retail and F&B industries will also have to pass the Service Literacy Test to qualify for the lower levy paid by skilled workers.

72.   Companies could also consider training their foreign workers alongside their local counterparts so that they can all become productive.  Although course fee subsidies are not available to foreign workers, companies can send their foreign workers for training courses and benefit from the Productivity and Innovation Credit and the National Productivity Fund announced by the Minister of Finance.   

73.   Companies that require foreign workers should also retain better skilled and more experienced foreign workers since they will be able to contribute to greater productivity.  Skilled workers can already work in Singapore up to a maximum of 18 years compared to 6 years for unskilled workers. 

74.   It was suggested that MOM allow hotels to cross-deploy foreign workers within defined job groups in the same hotel.  We are aware that selected businesses may require workers to multi-task or perform a secondary job function.  We have always taken a practical approach on this issue of cross-deployment.  While MOM can and does exercise flexibility on a case-by-case basis, we also need to ensure that each foreign worker has a specified and primary job function so that cross-deployment does not inadvertently result in exploitation or fatigue.  MOM will study this issue further in consultation with the relevant agencies and industries.

(IV) CONCLUSION

75.   Let me end by returning to the challenge of raising productivity and share with the House an example of how a company can constantly reinvent itself to boost its competitiveness and raise its productivity.  Jurong Shipyard has, over the decades, grown from the traditional ship repair and ship building business into new markets like rig building.  By investing in innovation and productivity, it has successfully developed an innovative rig construction process that allows it to build more than one semi-submersible rig concurrently, thereby improving its productivity.   

76.   Jurong Shipyard has also invested in the upgrading of its workforce to complement its innovation efforts.  In 2009, it received a total of $100,000 in subsidies through government schemes such as SPUR.  It has made efforts to make the Marine sector more attractive, by taking part in the Place-and-Train programme to attract workers to make a career switch from other industries to train and become supervisors in the Marine sector.  To tap on the experience of its older workers, Jurong Shipyard extended the official retirement age for many of its local workers.  Its oldest serving employee is 74 years old and it has another 120 employees who are aged 62 and above.

77.   These initiatives that I have just described have worked together to increase Jurong Shipyard's productivity – its value added per employee has almost tripled from $53,900 in 2004 to $150,000 per worker in 2009.  Over the past few years, Jurong Shipyard has shared the gains from productivity cost savings with its employees by giving out an average of 5.5 months of bonuses.  Going forward, its parent Sembcorp Marine has set up a Productivity and Innovation Committee with a full-time secretariat to look at productivity improvements in all aspects of its operations.  It has also set aside $10 million over the next two years to fund productivity and innovation projects. 

78.   Jurong Shipyard has showed us how to make productivity and innovation an integral part of a company's core values.  Similarly, we need to mobilise the entire nation to make productivity-driven growth a key priority over the next decade.  The journey will be a challenging but it promises to be a rewarding one.  This will require a concerted effort by everyone - workers, unions, government and employers alike.  Each of us has a critical role to play:  the Government providing the help of support, enterprises taking the lead in innovation and investing in productivity, workers and unions responding proactively to upskill and reskill the workforce.  We have weathered the economic downturn together as a united team.  I am confident that we have the strength and determination to build on this momentum and shift to a higher gear, decisively transforming ourselves into a productivity-driven economy and developing Singapore into a leading global city in Asia.