LABOUR issues dominated the second day of the Budget debate on Thursday (Feb 27), from employers’ talent shortages to employees’ need for training.
Of 26 Members of Parliament (MPs) who spoke, several highlighted labour shortages faced by companies.
East Coast GRC MP Cheryl Chan proposed more generous Employment Pass quotas for small and medium-sized enterprises (SMEs) than for multinational corporations (MNCs).
To encourage local workforce development, higher minimum salaries could be imposed when MNCs hire foreign professionals in junior roles, she said.
Nominated MP Mark Lee proposed four ways to tackle acute skilled and semi-skilled labour shortages, particularly in manufacturing.
First, more roles could be added to the Non-Traditional Sources (NTS) Occupation List. These jobs can be filled by work permit holders from sources other than the usual countries.
Second, there could be more NTS countries “to address the drying up of traditional sources like Malaysia and China”.
Third, there could be more support for companies undergoing transformation. For instance, the dependency ratio ceiling (DRC) – which caps the share of foreign workers in a company’s workforce – could be “conditionally” expanded.
The Manpower for Strategic Economic Priorities Scheme – under which eligible companies that contribute to Singapore’s strategic growth can get additional S Pass and work permit quotas – could also have a longer support duration.
Finally, companies could be given more flexibility in deploying foreign workers, particularly for skilled and semi-skilled roles.
Firms that hire more Singaporeans than required under the DRC, meanwhile, could be rewarded, suggested Workers’ Party (WP) MP Faisal Manap. This could be through tax breaks, lower government charges or preferential access to state incentives.
Helping workers
Other MPs, including eight from the labour movement, proposed measures to help various groups of workers.
Training was a major theme. For young workers, National Trades Union Congress (NTUC) assistant secretary-general Desmond Choo suggested higher funding for “quality internships”, and a “national internship standard” to define internship scopes, learning outcomes, and mentorship structures.
For mid-career workers, WP MP Gerald Giam wanted clearer pathways in the Career Conversion Programme, and active matching to improve job placement.
Pioneer SMC MP Patrick Tay suggested extending the Jobseeker Support Scheme to mid-career and senior workers “in the broad middle”. The scheme is currently limited to those who earned no more than S$5,000 a month in the last 12 months.
For lower-income workers, NTUC director Fahmi Aliman proposed that payouts under the Workfare Income Supplement scheme continue rising beyond age 60, where they currently reach the maximum.
Employability of vulnerable workers was another concern.
Pasir-Ris Punggol GRC MP Sharael Taha questioned if the Enabling Employment Credit – which offsets wages of persons with disabilities – is “truly moving the needle” in improving their employability. Beyond incentives, regulatory measures could be considered, he said.
Choa Chu Kang GRC MP Don Wee suggested that inclusive companies get tax rebates, bonus points in government tenders or higher foreign worker quotas.
Fiscal debate
Labour issues aside, Thursday’s debate extended an earlier discussion of fiscal forecasts.
Opening the Budget debate on Wednesday, Leader of the Opposition Pritam Singh questioned the government’s tendency to underestimate revenue, saying that this could create scepticism when tax hikes are required.
On Thursday, fellow WP MPs Sylvia Lim and Louis Chua reiterated this, as well as their party’s objection to the goods and services tax (GST) hike and the use of handouts to mitigate its effect.
Similarly, Progress Singapore Party Non-Constituency MP Leong Mun Wai said: “If year after year, surpluses are always bigger than what is estimated, then it really calls into question why the government decided to inflict… so much pain on Singaporeans by raising GST in 2023 and 2024 amid high global inflation.”
Some People’s Action Party MPs, however, said that surpluses should not be taken for granted.
Noting the major role of the net investment returns contribution in the fiscal position, Holland-Bukit Timah GRC MP Edward Chia said that surpluses “are not a licence for reckless spending”.
Nee Soon GRC MP Derrick Goh similarly noted that corporate income tax has been a major driver of recent surpluses, but fiscal planning should not rely on such “cyclical windfalls”.
Instead of “potentially fomenting cynicism”, recent surpluses can instead generate confidence in the government’s fiscal prudence, said Jurong GRC MP Xie Yao Quan.
