MSF – KiFAS and Student Care

I delivered the following two speeches today during the Committee of Supply debate on Ministry of Social and Family:

Sir, I refer the Minister to the KiFAS portion of my Budget speech. I am puzzled that after review, KiFAS can only be used on kindergartens operated by MOE and Anchor Operators. Those that qualify for KiFAS form less than half of the some 500 kindergartens here. More than 95% of qualifying centres belongs to just PCF. Other than PCF and MOE centres, are there actually any other existing centres that are KiFAS approved today?

There are many good kindergartens, some with long history, like the ones my siblings and I attended some 40 to 50 years ago. KiFAS should apply to all registered kindergartens, just like its sister scheme, CFAC. CFAC can be used on all childcare centres. MOE saw it fit to support aided schools with religious affiliations. This government has pride our recent Budgets for being inclusive. I believe we can be more inclusive to allow more, if not all kindergartens to be KiFAS-supported.
Student Care Centres

Sir, we have seen a huge rise in the demand for child care. Of late, the government has put a lot of resources in this area.

However, I do not see the same being done for student care.  The same young working parents that use childcare services will need student care for their children, at least for the first few years of school.

Commercial SCCs are unattractive to run given the high cost of rent and lack of government support, compared to childcare. MSF website listed 207 student care centres, of which a good number are tuition or childcare centres. These may take a very small number for student care, if at all, as their other operations are generally more profitable. Good student care services could eliminate the need for tuition. Is the current supply of student care places sufficient for our increasing needs?

Student care operations are also not subjected to the ministry’s supervision for quality, unlike childcare. SCCs are not required to be licensed and are not subjected to regular checks by MSF. Their staffs need not attain minimum qualifications and training.

I urge the government to extend better funding and resource support to this sector, create more places, work with MOE to have SCCs in all schools, and to provide closer supervision of the quality of operations.

MOT – Bicycle Safe Singapore

I delivered the following speech during the MOT Committee of Supply debate on 11 March 2014:

YJJ Cycling to BridgeMadam, two months ago, I did a day-long cycling trip through San Francisco (SF), on a working weekday, from the bustling financial and shopping areas to the Golden Gate Bridge and back. It was a refreshing experience. Even in the busy downtown, there were clear bicycle lanes marked out for cyclists. Where there were no dedicated bicycle lanes, the slow lane was marked as a shared lane between motorists and cyclists. Motorists that were on the shared lane followed behind us. In some suburbs without any marked lanes, motorists waited patiently for us to cross the road junctions. They kept a safe distance when overtaking us.

Bicycles were allowed onto trains and subways. There were shared bicycle kiosks in many parts of the city where one could book out a bike and return it at another kiosk. It is no wonder that many in SF commute to work by cycling.

There are other examples of bicycle friendly cities. In Copenhagen, cycling is already the most popular mode of transport and the city has set even ambitious cycling KPIs, such as for bicycling to capture 50% of all modes of transport to school or work. The city has dedicated lanes and special short cut paths for cyclists. It takes a whole-of-city approach to encourage cycling by reducing travel time on popular routes and made roads safer and more comfortable for cyclists.

I acknowledge that the government has implemented some cycling paths and plans to have more. Having experienced San Francisco, I hope the government can set even more ambitious targets to make cycling safer and more comfortable here so many more can use it as a preferred mode of transport. We can start with new towns by having more dedicated bicycle lanes on roads and to have a more aggressive national campaign to cultivate respect for the roads between cyclists and motorists.

MEWR – Transboundary Haze Pollution

I delivered the following speech during the MEWR Committee of Supply debate on 10 March 2014:

Sir, the haze is at our doorstep again. Singapore has been affected by recurring haze episodes resulting from land and forest fires in Indonesia since 1991, with last year being the worst ever. These had an adverse impact on our tourism, economy and the health of our people.

I had previously in this House, called for legislation to empower our authorities to punish those found guilty of transboundary haze pollution in Singapore through their deliberate actions, even when committed outside of our shores. I am glad to see that the ministry is contemplating a bill to this effect that can impose criminal and civil liabilities on guilty entities. While some may argue that it is hard to impose our rights outside of Singapore, we should bear in mind that many of the large plantations have operations in Singapore or are public-listed here. We want to do business with companies that are responsible.

Many Singaporeans desire to know if the products they buy have been produced through illegal land clearance. While the fines may not seem large, the proposed legislation will now empower our government to have the means to take legal actions in our own courts against offenders. Such actions will signal to our consumers whose products they should and should not support. It will also signal to the region of our determination to solve this perennial problem and can hopefully spur other countries to enforce actions on offenders as well.

MOE COS – Learning opportunities for NSFs

I delivered the following speech during MOE COS debate today.
Sir, last year, NUS announced a 3-month online plus 3-month campus learning programme for incoming undergrads who have completed NS. The programme qualifies for academic credits.[1]
Last month, NTU went one up. Its online courses allow anyone to earn credits and transfer these to NTU if they enroll as an undergraduate later.[2]
MINDEF has initiated a Committee to Strengthen National Service (CSNS). Amongst other things, it is looking at how skills picked up during NS could be recognised in civilian life. An example is the Swiss allowing the transfer of skills or leadership positions in the military into credits in universities.[3]
Online learning is now widely used everywhere. We can marry the ideas started by the universities and what MINDEF is looking at, by having more programmes to engage NSFs in continuous learning.
A Straits Times’ article last year highlighted that more NSFs are studying part-time, but with private providers.[4] NSFs will have varying degree of free time. Online can let them pace themselves and learn even whilst in camp.
Our schools can look at courses that expand on what NSFs are learning in their vocations. MINDEF has gone high-tech. Universities can offer courses such as computing, telecommunications and engineering that explore the technology behind the weapons and tools that NSFs use. Management schools can engage them in leadership and soft skills.

MOE COS – Tertiary Students Internship

I delivered the following speech during MOE COS debate today.
Sir, I have taken interns in my companies for the last 13 years, from secondary to tertiary students. I made it a point to expose them to real-life work, as relevant as possible to their training, skills and interests.
Internship is an important part of tertiary training, as the Minister had just said. This will become even more so when we run practice-based universities. Even research universities need to develop meaningful internships to allow their students keep abreast of industry needs. Countries like Germany have strong internship programmes. Often, graduates continue to work for the companies they interned in. Research know-hows from German universities have also strengthened the technical capabilities of companies, often through internship and apprenticeship links.
Madam, there may develop a gap between the number of interns and the availability of meaningful internship places as we increase our tertiary intake. From my experience, I also found differing intensity of engagement by education institutions and by their supervisors with companies like mine.
Internship can be an effort beyond the institutions. It can be at the country level. We can identify technical skills needed in priority sectors and help inject these capabilities into local companies to make them global players. The government can work with larger companies to identify those prepared to commit a minimum number of internship places with real-world projects, and support companies by funding an internship manager. This manager can mentor interns and even guide them while they work part-time from their schools on projects initiated during internship. This will allow companies to assign longer and realistic internship projects and tap on academic supervisors to guide students in research.
By building deeper engagement, it will raise the bar for internship across the country and foster closer links between the industry and research done in tertiary institutions.

MOE Debate – School-based Student Care Centres

I delivered the following speech during MOE COS Debate today.
Madam, there are now 80 School-based Student Care Centres (SSCs). While this is an increase since 2011, SSCs is available in just over 40% of primary schools here.
The number of student care places outside of SSCs will continue to reduce as operators find it commercially unattractive to run these due to high rental costs. Operators prefer to offer child care services which are better funded by the government or run tuition centres. The demand for student care services has increased just as it did for childcare services. The best place to run such centres is in the schools, where students need not move out of the school and the operators can best coordinate with the teachers to follow up on homework and learning. Schools’ facilities in single-session schools are not fully ultilised after school hours. If facilities are offered at token rents to operators, MOE can negotiate for lower fees and higher quality programmes. It will also reduce the need for tuition, benefiting children from disadvantaged families.
MOE did not provide figures for my PQ on the waitlist in SSCs. So I did a random check on 12 SSCs, both in new and in mature estates. I found that all, ALL have NO vacancies, with one having over 50 children on the waitlist! The demand is very strong. I like to see MOE aim for 100% of all primary schools to have SSCs as soon as possible. Existing operators that run community-based centres will likely be interested to move their operations into schools to avoid high rents and can pass the savings on to parents. I hope MOE and MSF can make this into an urgent priority.

MOE Debate – Integrated schools

I delivered the following speech during the Ministry of Education’s Committee of Supply debate today.
Madam, I have spoken about piloting primary through secondary integrated schools every year since I entered this House. I am glad that other honourable members like Mr Laurence Lien and Ms Denise Phua have also made similar calls.
Singaporean children must study in public schools unless they are granted permission by MOE to be schooled at home or in international schools.  They have to go through the PSLE, which is in effect a sorting test to determine academic streams and secondary schools admission.
Even with the ongoing review, the PSLE will still be used to sort students. The stress of early high-stake tests will still be there.
Madam, I understand that some parents will want a competitive system and for their children enter into what they believe as the best schools. There are however, parents like myself who would rather have our children go through primary and secondary education in the same school, without PSLE. The brand of schools had not mattered to me. Such an integrated system is available in many countries, including those that have fared well in education benchmarks. This choice is not available here.
I urge MOE to study the feasibility to pilot such integrated schools. We can leave out the top schools in the pilot so that this does not become a back-door. We have years of holistic assessments experience and capable educators. We can use these strengths to make such schools as good schools too.
Related Link:

MOF Debate – Life Insurance Tax Relief and M&A Scheme

I delivered the following 2 speeches during the Ministry of Finance’s Committee of Supply debate today.

Life Insurance Tax Relief

Sir, currently taxpayers can claim tax relief on premiums paid for life insurance if their CPF contribution is less than $5,000. This $5,000 ceiling was last raised from $4,000 in 1979, 35 years ago. That increase was to ensure that the lower-middle income earners continue to benefit from the concession.

Income levels have changed a lot in 35 years. Many working Singaporeans are not able to enjoy this concession while their foreign counterparts can because they do not contribute to CPF.  I hope the minister can review this scheme to raise the ceiling to a more appropriate level so that the lower-middle income earners of today can benefit and will be encouraged to save more for their old age.

[Ref: 1979 Budget speech-


Merger and Acquisition Scheme

Sir, I refer the Minister to my Budget speech. I had spoken quite extensively about encouraging M&A as it can help raise our productivity and global competitiveness. The current M&A scheme has not been well utilised and is meaningful only for larger acquisitions.

I hope the Minister can review the provisions in the M&A Scheme to encourage more M&A activities amongst SMEs through targeted measures. This can include higher allowances for smaller M&A transactions. It can also cover purchase of operations and businesses of SMEs rather than outright share sales, as the acquirers may be wary of potential liability associated with small companies. Acquirers who invest in automation of their acquired businesses to achieve greater productivity and to change old business models could be rewarded with more generous PIC incentives or special grants.

MTI Debate – Supporting SMEs

I delivered the following speech was delivered during the Ministry of Trade & Industry Committee of Supply debate today.

SMEs have borne much pain from a tight labour market and continuously higher industrial and commercial rents.

Supporting SMEs is vital to lift productivity across a huge swathe of our economy. In Germany and Switzerland, SMEs are celebrated as drivers of exports and economic growth[1]. Some of their mid-sized companies have world-class capabilities and are global leaders in their fields.

We should aim to help some of our home-grown companies become global leaders.

First, I echo the concerns of members who have called for attention on industrial and commercial rents. We have already lost the ability to manage rental costs, having ceded buildings that the government once controlled to REITS, which now dominate the market. In commercial retail, REITS, with their huge collective hold on the market can force up prices, sometimes steeply with each renewal. I call on the government to look at intervention measures, including having more industrial space of its own to set desired rental benchmarks and to provide checks on the rental practices of REITS in the malls as described by various members earlier.

Next, financing. MLP has provided 3,500 loans to small companies over the last 2 years.[2] Even with government’s increased risk share, banks may still not be willing to lend to start-ups with short track records.  MTI had said it does not monitor the success rate of loan applications for MLP. I hope SPRING can work with banks to raise the awareness of MLP and other schemes, and monitor the success rate of applications. It could intervene should banks be found to remain unduly cautious.

Also, there are many SME schemes, administered by different government agencies. The range of schemes is daunting and are often difficult for the ‘小白兔’ (little rabbit) type of small companies Mr Teo Siong Seng spoke about, to take up.

I am concerned that some schemes are too prescriptive. My colleague Mr Giam had in his Budget speech cited the example under IPG, where IDA pre-qualifies vendors for sectoral solutions under iSPRINT.

SMEs will be limited to these vendors if they want a fuss-free way to tap on IPG funds. SMEs sometimes know which solution they want. A pre-qualified list may restrict the development of new innovative solutions.

I declare that I had used grants from various agencies previously. Other than PIC, I have found the rest challenging in terms of application, approval wait time, making claims and writing of reports.

Perhaps we can learn from the PIC. PIC benefitted from much publicity. Can we “push” schemes to SMEs by requiring the completion of a simple questionnaire in the annual filing to ACRA? This questionnaire could ask about planned investments in training, software, automation, and so on that are not receiving scheme support. Based on responses, forms for relevant schemes or SME Centre officers could be dispatched to the companies.

Thank you.

Budget Speech 2014 – Honouring our pioneers, KiFAS and developing our SMEs

The following speech was delivered on 3 March 2014 during the debate on Budget 2014

Mdm Speaker, In Mandarin

议长女士, 我支持今年的财政预算案.


我的父母都是在五十年代末期从马来西亚来到新加坡。他们在当时的师资训练学院认识,在新加坡独立前结了婚,成为华校的华文教师, 他们从此在新加坡居住,也成为了新加坡公民,当了三十多年的华文老师,一直到退休。

那是个动荡的时代, 尤其是在华校里, 那是思想斗争的战场,当时新加坡正极力排除共产党的影响。

我的父母自1960年以来一直居住在同一间屋子里, 就在如今的如切单选区内。那时面对我家后院的甘榜菜市还有很多农场。

我父母亲的故事和我在如切区内遇到的许多年长居民都差不多一样. 这些居民大多数在同一间屋子里住了四十,五十多年. 很多从事平凡的工作,从岗位上退休了几十年。他们最关心的问题一直是医药费。即使他们已经多年没有收入了, 但是因为他们居住在私人屋子,就一直没有获得很多政府在医药上的津贴。


在国会里有许多的议员都是”建国一代”的子女。建国一代的新加坡人没有因为当时我国面对危险的环境和生活困苦而离开新加坡。虽然他们许多只是平凡的市井小民, 干的是平凡的工作, 但今日繁荣的新加坡是他们用心血建立起来的。我们应该尊重他们,也应该感激他们对新加坡的贡献。


[(English text for Chinese speech) Madam Speaker, I support Budget 2014. I am happy that we are honouring the pioneer generation of modern Singapore.

My parents both came to Singapore from Malaysia in the late 1950s. They met at the then-Teachers Training College, now NIE, got married and became teachers and Singapore citizens before our independence. They stayed put in Singapore and worked all their adult years in the same job, being Chinese teachers in our local schools. Those were turbulent years, especially teaching in Chinese schools at a time when Singapore had to fight the influence of the communists. Chinese schools were battlegrounds for mindshare. My parents had lived since 1960 in the same house in what is now classified as Joo Chiat SMC. Those days, Kampong Chai Chee facing our backyard was teeming with farms.

They are like many of the elderly residents I had met at Joo Chiat SMC, residents who have stayed in that one and only one house for the last 4-5 decades. These elderly residents have retired decades ago, many from humble jobs. Their biggest concern has been healthcare costs. They have not been able to enjoy many of the healthcare subsidies offered by the government because of their housing type, even though they have been without income for many years. I am happy that this package is given to all our pioneers, regardless of their housing time and how well they are doing currently. Many of us parliamentarians in this House are children of the pioneer generation of modern Singapore, children of people who stuck with this country when there was little and danger was all around us. Children of ordinary citizens no doubt, but citizens who build Singapore to what it is today. It is right for us to honour them.

Next, I will speak on two areas: Education and SMEs. I will continue my speech in English.]

Madam Speaker, in the area of education, the Minister has announced that KiFAS qualifying income level has been raised so that more families can benefit too. This is welcomed. KiFAS is now extended to all MOE kindergartens and those operated by the anchor operators. Previously, only PCF qualified for KiFAS.

I am puzzled why the extension announced by the Minister is to only these few operators. There are around 500 MOE registered kindergartens in Singapore. PCF operates 235 kindergartens. MOE has five, with up to another 10 being planned for the next few years. NTUC does not operate kindergartens. The 3 new anchors are childcare operators. I believe that they operate just 7 premium kindergartens between them. In any case, the anchor operator scheme is a childcare programme and not a kindergarten scheme. The commercial operators have to setup new operating entities to separate their current operations from the childcare centres that they will operate as anchor operators.

So in effect, parents still do not have many choices of which kindergartens they can send their children to. From my understanding of the kindergarten landscape and based on what the Minister has described, they may now choose between PCF and five MOE kindergartens.

Madam, I had spoken about this before. I find it strange that the CFAC, which is the equivalent scheme for childcare, can be used on all MSF registered childcare. However when it comes to kindergarten, MSF has imposed various conditions that had prevented others from qualifying. These include conditions such as the operators cannot have any religious or racial affiliations and cannot be private operators. None of these conditions are required for CFAC. I am not sure what will be announced at the COS, but I certainly hope the scheme can be extended to many more, if not all MOE registered kindergartens.

MOE has said that character and values education are important. Many of the kindergartens with religious and racial affiliations such as those run by Buddhist groups, Huay Kuans, Muslim groups, churches and other VWOs do take in children from the public and have strong character and values education. I wish to see them being included. I will speak on this again during the COS debate.

Next, SMEs. I wish to declare that I own and operate private companies classified as SMEs.

While Singapore enjoyed 4.1% economic growth last year, this economic growth had come about solely because of the growth in manpower. GDP growth is defined as workforce growth plus productivity growth. Productivity growth last year was zero. We cannot depend on economic growth through workforce increase. The government’s long-term goal is to reach 2-3% annual productivity growth by 2020.

At last year’s budget, I spoke of the need to encourage industry consolidation. The current schemes such as PIC and now PIC+, tend to benefit the larger companies. We have over 150,000 SMEs in Singapore. Many are micro enterprises that may not even employ the three non-shareholder staff required to qualify for PIC (cash grants). Even for small companies that qualify, they may not have the scale to benefit meaningful from investments in major automation.

Many of our smaller companies are struggling to stay afloat under the tight manpower and high rental cost environment. While raising their productivity and injecting innovation into their businesses should be the way to go, these companies need to scale up first. Last year, I had argued for the need to stimulate merger and acquisitions (M&A) so that enlarged companies can better take advantage of economies of scale.  I wish to repeat my desire to see changes to tax incentives to encourage M&A.

There is a Merger and Acquisition scheme, first introduced in 2010 and enhanced in 2012. As of May last year, only 42 companies have used this scheme. 34 were companies which MOF classified as SMEs with annual revenue of up to $100 million, which meant many could be fairly sizeable companies.  The average and median size of deals supported by the scheme was $25 million and $3 million respectively.[1] The scheme provides meaningful tax incentives for large and mid-sized deals but not for acquiring the small and micro enterprises.

I hope to see the government encourage consolidation amongst smaller companies through enhancing the M&A scheme. The M&A scheme could be graduated to allow higher tax allowances for smaller deal sizes of up to $1 million in value.

Also, the current scheme allows only for outright purchase of shares. Some acquirers prefer to buy over the operations and businesses of SMEs, but not the entire company as they prefer not to be entangled with liabilities that may be associated with the target company. We can loosen the definition of M&A to include such types of acquisitions.

We can also incentivise the acquirers to automate the operations of their acquired businesses to achieve greater productivity and to revamp old business models. We can look at allowing even higher than 400% tax allowances in PIC for investment in automation for merged entities to get them to speed up investments in productivity improvements for the acquired operations.

I noted that both the Singapore Business Federation and the Association of Small and Medium Enterprises (ASME) have also issued recent statements for the government to do more to promote M&A, including improving M&A tax allowances. They too cited the need for industry consolidation to create more breadth within industry clusters for better economies of scale and to reduce marginal costs.[2]

Besides tax allowances, the government could also look at how financing can be made more readily accessible for M&A. For example, the ASME had called for an equity financing scheme to help SMEs fund local and overseas M&As. Such a scheme would make available the option for companies to take on loans for acquisition through pledging equity in private companies. This can be done with risk-sharing collaboration between banks and the government. This will be a useful tool for deserving ambitious companies in our midst to grow rapidly through strategic acquisitions and take on the international markets.

Next, on the innovation mindset of our companies.

SMEs are grateful that PIC has been extended for 3 more years. The scheme has helped defrayed costs and many companies have only just started to use it. As of April last year, 97% of the claims were for purchases of IT and automation equipment and for employee training. The remaining 3% were for the other 4 categories, including R&D and acquisition of intellectual properties.

I believe innovation is important if we are to derive a lot more out of our companies. I hope we can encourage investments in creating breakthrough business models and technologies.

In their pre-budget survey[3], professional services firm KPMG found that 50.3% of 159 companies surveyed felt that the innovation measures in PIC have had no impact on raising innovation. The same survey found that only 1.6% of the respondents were focused on driving innovation.

The survey highlighted a worry finding that SMEs and even Singapore public-listed companies have not found benefits in innovation measures. Respondents in that survey commented that IRAS has been very strict in administering incentives for innovation, favouring revolutionary development at the expense of more market-driven evolutionary development. IRAS has a very strict definition of qualifying R&D activities. [4]

Indeed, this has been my personal experience too speaking with technology companies trying to develop the next killer App or a potentially industry game-changing software. They had not been successful in claiming PIC for their R&D manpower based on the strict PIC definition.

I hope IRAS and MTI can review the criteria and work on a more market-oriented definition of research and innovation and to drive more adoption by companies in this area.

Finally, in the area of SME financing, this budget provides for increased government risk-share on micro-loans to SMEs from 50% to 70%. In a reply to my PQ, MAS has said that it does not call for banks to require that SMEs meet a project track record or any specific requirement in order to get a loan. In evaluating loans, financial institutions all have their own criteria, some of which can make it rather difficult for companies, especially those with shorter track record to secure loans. This may be so even with government risk-sharing.

IFS loans cap has now been doubled to $30 million per company. I like to know from past evidences, if IFS and existing government-supported financing schemes had sufficiently met the overseas expansion needs of our companies. The total value of loans approved under IFS declined yearly from $378 million in 2010 to $121 million in 2012. Similarly, the Loan Insurance Scheme (LIS and LIS+), saw total value of loans approved fall from $2.3 billion in 2010 to $1.3 billion in 2012.[5]

The Economic Strategies Committee (ESC) had called for an EXIM bank in 2010, only to be deemed not feasible by MOF a year later. There were notable disappointments from the business community then at that decision.[6] Our companies are disadvantaged when compared with other countries like Taiwan, Japan and South Korea, where the percentage of total business credit going to SMEs range from 50%-76%, compared to 27% in Singapore.[7] Even with the increased government risk sharing, will financial institutions still be too conservative in their approach as they still need to bear some risks and there are less risky things for them to do?

I hope the financing situation for SMEs will be closely tracked. If the new measures are not sufficient to help meet our SME’s financing and overseas expansion needs, perhaps the government can relook again into whether it is necessary to create a SME Bank or an EXIM bank.

In conclusion, as we honour the pioneers of modern Singapore in this Budget, like the honourable member Mr Laurence Lien, I too like to think of each generation as pioneering for the next. As we approach the 50th year of our independence and soon the 200th anniversary of the founding of Singapore by Sir Stamford Raffles, my wish is to see a vibrant Singapore, with innovative home-grown companies and dynamic Singaporeans establishing a new Singapore in this 21th century, so as to ensure success for our future generation.

Thank you.