Singapore’s Post Covid-19 Future

Prime Minister Lee addressed the nation yesterday on Singapore’s future in a post COVID-19 world. His speech is the first in a series of national broadcasts with five other Cabinet ministers laying out future plans for the country.

I have a few areas which I’d like to see for Singapore post Covid-19.

(1) First is on domestic wage reforms. Business leader Ho Kwon Ping brought this issue up in an IPS talk in 2012. He presented data in a refreshing way. Ho asked IPS to compile data on the wages of various professions across 9 of the most developed economies in the world.

The finding? Singapore is the MOST UNEQUAL of all developed nations. On average, we pay doctors about four times more than nurses and 11 times more than construction workers. Doctors represent the top end of professional work, nurses the middle range and construction workers represent the low wage. In other developed countries, the disparity is far smaller. Doctors and lawyers were paid slightly better in Singapore than the average elsewhere but the startling fact was how badly we paid the low wage workers. In Germany and Australia, a construction worker is paid HALF that of the average doctor! Hong Kong, a small and open economy like ours, paid nurses a third that of doctors. Construction workers earned a quarter that of doctors!

Ho called it the incomplete wage revolution. It began in the 1980s as we reformed the export-oriented industries. Factories that relied on low wage workers shifted out. We had to move up the value-added chain with higher wages. Today, we have high value-added export and services industries that pay decent wages. The trouble was with our domestic industries. There are some industries that cannot be shifted out – we will need to have cleaners, gardeners, security guards, construction workers and retail assistants in Singapore. Instead of also increasing wages gradually and allowing companies to figure how to make workers progressively more productive, we had large-scale import of low wage migrant workers. The situation started to explode in the 1990s where we grew from 311,000 migrant workers in 1990 to over 1.42 million by 2019, the vast majority of whom are low wage. Foreign workers account for 38% of our workforce today, stretching the limits which a small country like Singapore can take.

The large influx of migrant workers over such a sustained period depressed the wages of local low skilled workers who had remained in the domestic industries. Employers continued to fill with migrant workers as the demand went up. Levies started increasing when the government wanted to force companies to hire locals and be less reliant on foreigners. I believe many of the measures were done too late. We were already having many low wage migrant workers willing to work for very little. The better and more experienced migrant workers can find better paying jobs in other countries. The higher levies and accommodation costs made businesses look for cheaper workers, never mind that their skill levels are not there and that they do not speak much English.

In two of my earlier blog posts, I recounted this 3-decade journey of large influx of migrant workers and some solutions we can look at using the construction sector as an example.

Today, Singapore face a rapidly changing world with lots of technology disruptions and with our neighbours also hungry for success. We are now presented with the disruptions due to the pandemic. We have China and USA on hostile relationship that is impacting world trade. These are all known facts. Even before the pandemic started, we were already seeing higher retrenchments amongst PMETs and challenging operating environment for our companies. There is mismatch between training and employment opportunities. With the pandemic, more jobs will be lost. More companies will close down.

We can use this current period of job stresses to transform certain domestic industries. It will take big government interventions but we can make certain jobs more viable for Singaporeans, to progressively pay better for technical skills like in other developed economies, and to gradually move the industry up the productivity path. We should seriously state our intent by setting Minimum Wages. We want to match the Swiss standard of living but our model for growth had so far been that of Dubai’s and not Switzerland’s.

(2) I am concerned as to our strategy on low wage migrant workers. This is an old issue, raised by experts from time to time. Even our founding leaders such as the late Dr Goh Keng Swee and the late Mr Lee Kuan Yew had warned about becoming over-reliant on migrant workers or having too many of them. We have blown past all the numbers they had warned about. In the 2013 Population White Paper debate, we were told to accept 1-2% increase in migrant workers each year or face economic decline. The numbers continue to rise after that debate. We could reach 6.9 million population in 10 years’ time and far more after that. This would result in a society with much higher income and wealth inequality, higher pandemic risks, as well as probably much higher xenophobia, social divisions, overcrowding, less social well-being and less social capital and national solidarity. 

Beyond providing better accommodation, we need to look at how to bring in more productive foreign workers so that we can have a better starting base and can pay them better. I am not an expert. I suspect there are lots of low hanging fruits we can pluck by first recruiting better. Currently, the middleman makes big bucks bringing able-bodied workers in from low wage countries willing to pay the huge fees to come to Singapore. Many may not have relevant skills. Many come saddled with debts, desperately afraid of being sent back home.

Singapore has done some small scale setting up of ITE-type of training in neighbouring countries on government to government relationship. I think if we can look at places where we recruit large number of migrant workers. We can put our vocational training expertise to good use. If we can have more productive workers already trained at source; familiar with the tools, processes and automation needed in Singapore, I believe we can jump start productivity. Having such institutions at source can also offer better transparency and links for recruitment. The implementation may need more thoughts and strong government backing to be workable. I think this can uplift productivity and wages at the low end, and allow us to do with fewer numbers of workers. And I believe that if we can build up a strong pipeline of skilled overseas workers, coupled with aggressive investment in better construction processes and automation, we might even be able to create globally competitive Singapore construction companies.

The welfare of workers can also be better taken care of. We can think of careers for them to move upwards while in Singapore. A few months ago, I came across a former foreign domestic worker who did part time studies in early childhood when in Singapore (she had a very supporter employer), and is now a trained preschool teacher here after finishing her domestic helper contract. Such stories are few and far in between. Most come, work hard with outdated and low productivity methods and return home with some savings to do other things. I believe few low wage migrant workers make it up the career ladder in Singapore. Many years ago, Singapore thrived because we provided opportunities for our low wage migrant workers. The innovative and hardworking ones climbed in their career and even start businesses in Singapore. Many of our big local institutions had started that way.

(3) We need to free up the Singapore spirit. We are victim of our past successes – we have grown risk averse. We celebrate innovation only when it meets the government’s agenda but clamp down on alternative views. I wrote about this last month – Monopoly of wisdom will cripple Singapore. I cited Sonny Liew as an example.

Be open. Be free spirited. Be bold. Our past leaders were so. PM Lee’s speech yesterday recounted how Singapore had overcome. Yes, we did. We overcame the lack of an armed forces with a modern force built on national service and modernisation. We overcame housing problem by being socialist – mass land acquisition from the rich and building HDB flats for as many Singaporeans as possible. We cleaned up the Singapore river, and more. Sure, we can do it again. There was boldness in the early leaders. There were no past successes to safeguard, only a future to aim towards. Bold ideas had to be tried.

These days, I noticed that many have become afraid to take risk. There are tried and tested ways to succeed. Just follow rules. Leaders in the government service or political office bearers are rotated frequently. We become wary of projects that may take years to see results or that cut across ministries or are seen as ‘risky’. We become afraid to let smaller start-ups have a go at projects in case we have to answer if projects fail. We award at higher costs to companies with big names so that if they fail, it will not be the fault of the evaluation team.

If we are to build world leading companies, to pioneer big brands that can fly the Singapore flag all over the world, we need to free up our spirit, not mute it. Our reforms cannot start only when Singaporeans enter the workforce. It must start from school. In education, we are again victims of our past successes. Our schools were earlier reformed to make the education processes more efficient to train up workers for incoming investments and to fill up jobs. We thought we had figured out the formula for sorting out students by abilities and then fast track them along career paths. We cannot rely on model answers, for the new world economy may not conform to known models. We need to celebrate ambiguity in education. We need students to be bold to ask questions. We need them to create.

(4) I believe Singaporeans are resilient. In recent years, with the growing mismatch between jobs and training, more have switched to the gig economy. Food delivery and private hire driving are not easy work. Yet PMET Singaporeans, many retrenched or in low paying jobs, turned to these trades to find a way to make a living. We will need to reclaim PMET jobs for Singaporeans and to work out viable career paths for Singaporeans in domestic industries, many of which are too low-paying to sustain the high costs of living in Singapore.

Being more resilient also means better preparedness in food and other supplies. Yes, it is great that we have Polish eggs and Arabian shrimps. MTI is doing right by seeking new sources of food and essential supplies. I think it would be just as great if Temasek takes the lead to invest aggressively so that we own critical food sources overseas. Sure, we might still be hit with supply restrictions such as what had happened over masks in Taiwan recently. To overcome our smallness in size, we may need to expand more aggressively into ownership of critical resources outside of Singapore.

Let’s look forward to a more resilient, more creative, more productive and more egalitarian Singapore post Covid-19.

Note: The views are that of the author. I had an earlier discussion with Ku Swee Yong where we found that we share similar ideas about having some ITE-type institutions in countries with large number of migrant workers bound for Singapore.

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Taking your start-up forward

I sat through several presentations by start-ups for ACE start-up grant yesterday as a panel member. As with all the past presentations, some were awarded, some rejected and some were invited to make further clarifications or adjustments to some aspects of their business plan before re-submission at another session.

Was glad to meet again one company that I had evaluated and provided feedback several months ago, and see that they have made significant inroads in their implementation in such a short time. I sense they will do well going forward with the energy that they have.

Meanwhile this week, the recently reconvened parliament debated on many issues, including encouraging start-ups. The start-up environment has changed quite a lot since I started my first venture 16 years ago. There were no start-up grants then that I could apply for. We pitch for funding from friends, family and those brave enough to trust their money on a yet-to-be-proven bunch.

There was no Blk 71 Ayer Rajah start-up friendly environment that we could hitch upon for a quick launch. We used part of a learning centre as a make-shift office and even converted a door from the office that had collapsed and turned it into a table, supported by two short cupboards.

 

Dr Koh Poh Koon cited an example of a local start-up, shopback being rejected for government support. I didn’t get to evaluate Shopback’s application so I do not know the circumstances on why they did not get the support. As a panellist for the past 4 years evaluating probably over 200 cases and mentoring some, there are many reasons for rejection. Some come with half-baked ideas that they struggle to articulate. Some could not communicate their ideas on paper or do not provide sufficient information that they do not even make it past the secretariat who sieves out the many proposals to allow only a few through for the panellists to evaluate at each session. Some do not meet the funding criteria for various reasons while some lack originality. The reasons are many.

 

Anyway, rejection is the name of the game for new entrepreneurs and would-be entrepreneurs. We have had our fair share of them – rejections from would-be investors, from government agencies, from customers and even from people we wanted to hire. One top graduate of a polytechnic applied for a job. When we offered, he turned us down saying that there’s no future working in a small start-up! Another took up the job and then resigned a few days later when a better offer came, paying an administrative bond that we had imposed on him. He said that he didn’t want to tarnish his resume if our start-up failed. How’s that for rejections. I have lost count of the number of rejections.

 

Last evening, a successful lawyer-turned-entrepreneur invited me to an event he was hosting. We had started our e-learning companies at around the same time in 2000. His company targeted corporations while we decided to focus on schools. We shared old stories over the dining table with the others. One thing we both agreed upon – entrepreneurship is a humbling experience. It does not matter if you graduated from a top school with sterling results or was a scholar or a great lawyer. You have to pitch to the customers and they will mostly decide based on your value-proposition, not how smart and successful you were in your previous profession or studies. And you will face lots of rejections. So what? Take it in your stride, learn why you got the rejection and figure out how to improve your product or sales pitch to have better luck the next time. You will get a lot of emotional ups and downs. Every success is a lot sweeter, every rejection hits you hard but you need to learn from these rejections.

 

I am happy to see that the environment for start-ups has become a lot better than it was 16 years ago. There are more government schemes that one can apply to, more mentorship programmes and start-up events, more start-up spaces and more venture funding activities. More people are turning to running start-ups to chase a dream rather than pursue a professional career. I hope government agencies, companies and customers can give innovative and energetic start-ups the business opportunities to grow. Looking back at my own start-up experience, we grew because there were business opportunities created then when IDA was pushing for broadband content usage in schools and created schemes to get local companies to put forward creative solutions. That short span of several years allowed competitive local solutions to emerge. For others, it could be different type of opportunities. But learning to see and seize the opportunity is very important for any start-up to succeed.

 

So if you want to run a start-up, grow a thick skin for rejections, learn to seize pockets of opportunities and get ready for the ups and downs.

 

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.

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[1] http://www.whiteboardmag.com/hidden-champions-1-what-german-companies-can-teach-you-about-innovation/

[2] Budget 2014 in brief

Stories of life-long learning

The following was part of a speech I gave at the opening of a training centre today. The centre trains individuals in IT, Project Management and life skills as part of continuing education.

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Henry Ford once said, “Anyone who stops learning is old, whether at twenty or eighty. Anyone who keeps learning stays young.” Henry Ford is an American industrialist and the founder of Ford Motors Company. Ford did not invent the automobile nor did he invent the concept of assembly lines. But he combined these two brilliantly together to create the first automobile, the famous Model T car that middle class Americans could afford. Automobiles went from becoming expensive toys of the rich into practical machines of everyday lives that revolutionised transport and American industry. In the process, Henry Ford himself became very rich. Ford himself was a learner and doer. At 15, he learned how to dismantle and assemble back his pocket watch and became a famous watch repairman amongst his friends.  As a young adult, he learnt about machines as an apprentice. He eventually worked for Thomas Edison, another great inventor and was promoted to chief engineer where he took charge of designing vehicles. After striking out on his own and after several unsuccessful attempts, he eventually pioneered an industrial model for car manufacturing that worked.

Another great man, Albert Einstein had also said, “Once you stop learning you start dying”. Einstein is world renowned for his many scientific works, from the invisible world of quantum physics to the vast expanse of the universe, far beyond what the most powerful telescopes can see. What was interesting about Einstein was that he didn’t amount to much in the eyes of people around him when he was young.  When Einstein’s father asked his son’s headmaster what profession the boy should adopt, he said, “It doesn’t matter; he’ll never make a success of anything.”  He failed his first admissions examination to the Zurich Polytechnic. After graduating from the university, Einstein was denied a low-level teaching assistant position there. He eventually found work as a third-class government patent examiner. That was when he came out with some of his best discoveries, including the theory of Relativity. But he was one curious guy whose mind never stopped working and he never stopped learning and discovering new things to a ripe old age.

I am a firm believer in life-long learning too, whether through formal courses or informal learning. More important though is how one should put what has been learnt into active practice.

Many people know my wife and I as the founders of ASKnLearn, now called WizLearn. It went from a 4-man start-up in 2000 to become one of the top 2 e-learning providers to schools in Singapore, employing some 150 people before we sold off the business in 2007. What most do not know is that the idea for ASKnLearn was sparked off from a 2-day workshop I had attended at SIM in 1999. The workshop was on ‘Creating Values in Your Business’. At the workshop, we were challenged to think how we can make quantum leaps in our businesses by leveraging on new business models and technologies. It was the era of the dotcom boom in USA then. Famous examples such as Dell’s were cited. Michael Dell took advantage of the opportunities offered by the internet to bypass the middleman to sell high quality computers at affordable prices direct to customers. Business boomed for Dell through a new business model. The internet had opened up new possibilities to allow transformational changes to be made at breakneck speeds.

Shortly after the training, at the grand old age of 34, I came down with chicken pox. I was the General Manager of an education group then. I was busy and had little time to reflect on things around me. I had to take 2 weeks of sick leave from work. To make matters worse, my son was just 1 month old then and I had to isolate myself from him too in case I spread the virus.

In those free moments, I thought about what was said at the workshop. I thought to myself, “Hey, I am trained in computer science and I somehow ended up in different aspects of the education industry in various career moves. What can I do to use my training, the technology around us and my work experiences to create a new business that can deliver value in a novel way?” I decided to follow up on an old business idea I had thought of several years back but was not feasible due to the infancy of technology then. I called together some friends, who were not afraid to catch chicken pox from me. We did the traditional back-of-the-envelope thingy that many dotcom start-ups went through. I shared an idea for online learning and testing. My friends decided to invest, my wife and I left our jobs and ASKnLearn was born.

So when you are prepared to learn and your mind is constantly active, you can make things happen.

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Entrepeneurship lessons from the movie “Jobs”

Yesterday I watched the movie Jobs. It was about Steve Jobs and his story with Apple Inc.

It wasn’t exactly an exciting movie in terms of drama or action. However, I felt there are some interesting lessons for entrepreneurs, wanna-be entrepreneurs and people trying to understand successful entrepreneurs (including policymakers). So I decided to summarise into the observations below. Of course, Steve Jobs is not your ordinary entrepreneur. After all, Apple became the most valuable company on earth last year. Still, he shared some common characteristics with other entrepreneurs.

1. Entrepreneurs smell out opportunities. Jobs was at Wozniak’s house when he spotted the motherboard that Wozniak had built. He enquired and sensed it could be something big. He convinced Wozniak to take it to a pitching session at Stanford University to promote the idea. Out of that primitive motherboard eventually came the Apple II computer.

There are often opportunities everyone. Some opportunities are in the form of everyday news. An entrepreneur hears of news of say some problem, and could sense perhaps he could make a business out of it if he/she could create a cost effective solution to the problem. Or the entrepreneur could see some new inventions in their primitive state and match it to market needs and trends. It is part intuition and part discipline. Intuition because there is often no clear way to identify opportunities and you have to figure how to connect disjointed dots together. Discipline because one must keep looking and reminding oneself to look for opportunities. But to many others, news is just news. Raw inventions are just raw inventions. Nothing else. Many people will look at the same piece of information but only some can make things happen with that piece of information.

2. Entrepreneurs sell. Steve was not the one with the engineering ability. He sold the idea to Wozniak to leave HP and make his original invention big. He sold the motherboard (as first version of Apple) to the owner of Byte Computer shop. He convinced others to work for him in his garage. He convinced early investor Mike to fund the venture. And of course the world has seeen how well Jobs could sell his ideas. True-bred entrepreneurs never stop selling, whenever he/she smells an opportunity to do so. And when you sell, keep the message concise. Master that elevator pitch. You often need to sell your idea in a minute to get any chance of attracting further attention from your audience.

3. Entrepreneurs are resilient. The idea was new and the business unproven. The first sales pitch at Stanford University was quite a failure though it resulted in a small break with the owner of Byte computer shop. The first version, just a raw motherboard was not well received by Byte Computer. So they decided the next version must be a complete set, neatly assembled into a small compact casing. He was told it was impossible to make the power unit small enough, silent enough and cool enough to fit into the casing. He pursued leads and eventually found an engineer who could make it.

The movie showed Jobs making hundreds (or thousands) of calls to Venture Capitalists (VCs) to get the funding. That’s a pretty familiar scene for most start-up entrepreneurs. You will get rejected lots of times, whether it is pitching for funds or trying to sell your products. Get over each rejection, learn why and look forward to the next pitch. Never wallow in the rejections. Use them as lessons on how to make better pitch or adjust your business plans or products. Look forward. The first investor, Mike came because Jobs had pestered Mike’s friend so hard that he told Mike to do him a favour and just go see what the deal was about.

4. Great entrepreneurs inspire confidence. It is hard to get people to buy in to your ideas or products when they are raw. True entrepreneurship is like creating a beautiful picture out of a blank piece of paper. You try to make things happen out of nothing. It is hard for others to buy into your vision with nothing much to show. Why would a shrewd investor like Mike invest US$90,000 plus extend a loan of (I think) US$250,000 to Apple Inc. when it was just a garage set-up without a ready product. What makes investors and customers buy in to ideas when they are still raw? Often, it is the entrepreneur. Entrepreneurs who believe deeply in their vision exuberate the confidence that is almost contagious.

5. Start-up entrepreneurs are driven by passion. A reason why great entrepreneurs can inspire confidence is because they are themselves driven by passion. Once they are locked onto a idea they passionately believe in, they can live, eat, sleep and dream about that idea and they pursue it until it come to fruition. That passion is evident in their tone as they speak of their ideas and products. And the more they immerse themselves in an idea, new creative thoughts on how to improve on the idea can come from just about anywhere, even when taking a shower or when driving or when they are about to fall asleep. In the movie, we saw how Jobs went about relentlessly trying to perfect the motherboard that Wozniak first made. He also went about determined to make the perfect typeface for their word processor, to make Lisa the ideal computer, to create Macintosh into the dream product that he could not do for Lisa and to keep his products simple yet elegant. Jobs was so over consumed with his passion that he was often unforgiving to staff who failed to share the same passion.

If we hope to inspire a new generation of creative entrepreneurs, we will need to give our youth space to pursue their passion. If we want to start them young, the space to explore ideas must be allowed even while they are in school. Parents need to also understand their children and give them the space to explore.

6. Entrepreneurs are doers. They make things happen. Jobs was certainly driven to make his ideas come alive by pushing everyone towards a common target. Even after being axed from his own company, he went on to start NeXT Computer and Pixar. He was constantly making things happen.

I once read an excellent interview with Bill Gates when he was then the richest man on earth. He was asked how he became the richest man. He said, “First, I was at the right place at the right time. Second, I had the vision. Third and most important, I took action.” Gates certainly grew up in exciting times. The personal computer industry was starting to boom. But so were several billion other people who were in the world at the same time. Gates had the vision that software would power the PCs and there was a gap in the market for this. I am reminded of a friend whom several years ago after reading a news report of a booming new business, said he thought of that idea a few years back. I asked him, “So what did you do about that idea?” My friend is still a professional manager in a large local company today. Gates went on to act on his vision. So did Jobs and many other entrepreneurs.

Sometimes I meet people who tell me they have some wonderful big ideas that will change the world. Some are so secretive about their ideas. I would tell them ideas are cheap. Execution is key. Operationalize your idea and be prepared to sweat it out.

7. Entrepreneurs are often rebels. Jobs was definitely one. He quit Reeds College to explore what else life could offer him. He couldn’t fit into the culture of Atari even though he successfully met the challenge to  produce the game his boss had wanted. He was often restless and pushing out new ideas. This may not be true of all entrepreneurs but it is often true of those that thrive on innovation. They generally don’t like rules. Rules and norms wear them down.

This is where I feel it gets hard for us to emulate the type of start-up successes that happen so often in USA with our existing culture. We are quite bound by rules and are conditioned to opt for the secure path. Our education system tend to focus on the examinations. There is little room for students to creatively explore ideas. Those that do well academically are sucked into a system of being professional managers. The risks and stigma of failure are high in our culture. Operating costs are high.

Having said that, I do see more young and restless ones dabbling with business ideas. Some jumped into business right after graduating or even before completing their studies. Hopefully our education system can take more effort to cultivate creative exploration by students.

8. Entrepreneurs don’t work alone. As bright and capable as anyone can be, you need a team if you are to grow your business from an idea into a product, and from a product into a scalable business. Often, businesses fail along the way because a good idea need not necessary become a good product without the right team to work on it. A good product will need a team to market, support and constantly innovate. Jobs had Wozniak, the bright engineer as co-founder. He rounded up people to work when the first order came in. He needed another engineer to create the power supply unit that fitted what he wanted. And as Apple Inc. grew, he had to create a structure to manage thousands of employees. The entrepreneur can be the visionary to draw people in but in order for any business to grow, an effective team must be organised.

Of course, the movie also showed some dark sides of Jobs’ life. He was intolerant and brutal, even to those close to him. I rather not comment on these aspects as everyone has weaknesses, and I am not certain how much of what was shown were dramatized to make into a movie. This post is not to glorify Jobs as well. As one who had walked the start-up path before, I identified with the journey Jobs went through, though of course mine is nowhere as dramatic. Still, the lessons are pretty much common for those who choose to take such a path. So while the movie is not spectacular in terms of drama or action, catch it if you want a peek into the mind of a start-up entrepreneur.

Finding the Singapore Psy

The 17 Oct issue of TODAY featured Psy and the economics of Gangnam style. Psy (Park Jae Sang) is suddenly famous. He holds the record for the highest number of Youtube likes (now over 4 million and still rising) and over 400 million views, after officially releasing his video on Youtube only in July this year.

Psy goes against the grain of successful pop stars. He is portly and by his own admission, is not good looking. He was once told by major record labels to get a drastic image overhaul, including plastic surgery to ever be successful. He did none of these and chose to “dress classy and dance cheesy”. He is the total opposite of what had made K-pop successful in the past: stars with long legs, robotic dance moves and years of training and grooming to make more out of the same mould.

He got South Korea’s finance minister talking about him.  South Korea’s top economic official cited Psy as an example of the kind of creativity and international competitiveness the country needs. It was a plea for South Koreans to let their hair down and dream a bit.

As successful as South Korea is in the competitive world of global electronics and export, the finance minister recognises that the country needs to continue to find its own groove. It needs the creative Psy in businesses to go against the grain for the country to continue to propser as innovation becomes more important for success globally.

I believe Singapore needs that too. We may have found success in our early industrial policy. We went against the nationalistic grain of what our neighbours were doing and attracted multinationals to our shores. Former Perm Sec Ngiam Tong Dow had warned of flying on auto-pilot mode, relying on past successes as a sure and safe way for future progress. He was pushing for Singapore to grow its local ‘timber’, i.e. develop our SMEs to a level that they can compete globally. To do so, we will need innovation.

Innovation needs a mindset change. It is difficult to mandate innovation. It has to start from a culture from young where we dare to be different, where we dare to go against the grain and we dare to try alternatives. Our formula for success is too predictable.  Our system has put too much emphasis on measuring children from young and sorting them into cookie-cutter programmes we think are best for them. We sieve out the elites through tests and channel them onto fast tracked programmes. We have created an excessive meritocratic education system where the rewards for doing well in academic examinations are exceedingly high. We will end up breeding a next generation of policymakers fixed on doing what had been done previously because that is the safer way to carry on with things.

To have a culture of innovation, we need to cultivate such an attitude right across all areas of our society. If we want a Singapore Psy, we need to let our hair down in our creative sector, even if it causes a bit of discomfort sometimes. Once a while, over enthusiastic officials will clamp down on artistic expressions in the fringes, afraid that our population cannot discern. We will get conforming people but not the next Psy.

If we want Psy-thinking in our businesses, we need to encourage divergent thinking from young. We need to find alternative ways to educate our young and to find a different way to progress them up the education ladder. We need to incorporate into our education more areas that do not have fixed answers. We need to find a way to embrace greater ambiguity and diversity.

Our economy will also need to allow the space for SMEs to develop. We need to allow fresh spaces for them to grow, rather than stiffle them under the shades of giant GLCs and multinationals. I had spoken on this earlier in my Budget speech in parliament this year.

I look forward to a day when we can have our Singapore Psy, in pop culture and in business. We need confident Singaporeans, prepared to be different.

Developing people, developing talents

I heard an interesting interview on FM 93.8 LIVE today in its “Small Talk, Big Returns” show. It was an interview of a Ms Sylvia Fernandez who practices motivation and leadership development using the methods of book author and leadership consultant Aubrey C. Daniels.

The interview struck me because I share the sentiments expressed by Ms Fernandez. She cited the example of Enron, the failed US Energy giant. It had a model of paying top dollars to buy top talents into the company, talents being defined narrowly by bright people with high academic achievements. They quickly learn the behaviours of the company and propogate the same behaviours because the leaders were looking for people who would exhibit the behaviours they wanted. Enron had over relied on a small group of intelligent people with bright results while ignoring the rest.

She said that while we should pay for talent, we should never undervalue the rest. Develop people, help them grow organically. Turn your organisation focus inwards too. There are talented people inside, even if they do not have the academic qualifications or perceived high IQ that some from outside come with. Identify people, take them up, reinforce them, inspire them to do more and make them fly. This will lead to great productivity gains in the company. Inspire people in your organisation to do more. There are a lot of misplaced and demotivated people in organisations. We need to take them from mastery of whatever areas they are already in, into fluency, even if it takes many hours of patient training and cultivation.

She cited studies that showed that exceptional performance and IQ does not have a strong co-relation and hence we should not be overly focused on just getting people with bright results and assume they can do exceptionally well in the organisation.

I recall my own experience as an entrepreneur growing a start-up, patiently growing from a 4-man company into a sizeable player in our industry. We started to grow rapidly only when we looked for talents internally, identified highly motivated individuals and gave them challenges to grow the areas they were in, or even create new areas which we allowed them to run with autonomy. They were not people with sterling academic results. In fact, one who rose to later lead the software development team orginally graduated from a vocational institution. The one who rose to manage sales and eventually the company’s entire operations originally had a polytechnic degree in a non-related field. They had started from the most junior positions in the company. Most of the rest who rose to key positions had started from the junior ranks, mostly with unimpressive academic results. They impressed with their exhibited self-drive and desire for continuous learning. This is not to say we did not value those that came with good academic qualifications. We had some with good academic results who did well too. The point is that many organisations follow too narrowly on the model that people with solid academic results are automatically talent and should be fast-tracked to leadership roles.

So I could immediately identify with what she spoke about. In this age when we need to raise productivity in organisations greatly to stay competitive, we need a different mindset in the way we identify, cultivate and motivate people. Only then can we get quantum leaps in productivity. You never know what gems there are in your organisation until you start to look inwards. Organisations that were successful in the past may become entrenched in their own past success that they start to identify only people who follow their same mould and forget how to reinvent themselves for the future, just like Enron. So we also need to be open-minded about our definition of talents and guard against in-breeding.

Being a politician now, I wonder if we should apply this to the way talents are identified and developed in government and politics as well. Hmm…

My Budget Speech – 28 February 2012

Yee Jenn Jong Budget Speech (28 February 2012)

Mr Deputy Speaker Sir, I welcome the noticeable shift from previous budgets which concentrated mostly on economic growth towards more social programs in this Budget.

Over the last decade, our society faced many challenges such as widening income inequality; rising inflation and slower social mobility. Wages of low and lower-middle class earners have stagnated or grew much slower than that of our highest income earners. Our over reliance on market-driven policies has resulted in deficiencies in the provision of social goods.

Refocusing on the weak, disabled and elderly amongst us is timely. The government has to step up to mitigate the adverse impact of the widening income inequality by proactively providing essential social goods and services.

This budget is a first step. Moving forward, we need to tread between growth and equity; between individual’s and society’s responsibility. How far will we go in our journey to be inclusive? How much do we provide for in elderly care and medical costs? What is affordable public housing? What levels of social security are we comfortable with? These questions must be debated upon as our nation define a new social-economic model going forward.

SMEs

Next, I like to touch on Small and Medium Enterprises, a subject close to my heart as I operate in this space.

There are a number of assistance schemes in this Budget for SMEs. We have not been short of schemes for SMEs in the past, especially in the form of grants. While these can provide some slight help given the challenging environment SMEs operate in, they are like aspirins for short term pain relief. We need to look deeper beyond assistances to tackle directly the important issues confronting SMEs.

In preparing for this section on SMEs, I recall a hike I made into a primary rainforest in Sarawak some years ago. Walking into the rainforest on a hot day, I noticed dim lighting and a distinct lack of undergrowth. With sunlight blocked by the canopy of the giant trees, smaller plants could not flourish.

SMEs operate in challenging environments. Industrial rent increased at more than three times inflation rate at 16% last year. This increase is the highest level in the past 14 years. Retail rent rates have been rising steadily too. Industrial and retail spaces are now dominated by REITS. I join Members Inderjit Singh and Mr Teo to echo my concerns about the effects of a decade of the proliferation of REITS. Could the retail rents increase be partly driven by Retail REITS enhancing their negotiation position given common market practice that they can obtain the retailer’s gross retail turnover data? I urge serious review on the effects of REITS on SMEs.

Going forward, SMEs will find it harder and more costly to hire suitable manpower. In certain industries, there will be continued competition from the big boys. The Budget provides for assistance in Merger and Acquisition. Some SMEs may be forced to close or merge. SMEs form 99% of our business entities and employ some 63% of our workforce. Jobs will be at risk as a result of closures and mergers. We need brace ourselves for a rough ride in the SME space in the next 5 years as the economy restructures. We need to be prepared to help those whose jobs will be lost during this period of restructuring.

We dream of the next big thing to fly the Singapore enterprise flag globally. How do we achieve that?

Going back to the rainforest analogy, how do we get smaller plants to grow? They need air, water, good soil and sunlight. The seeds themselves must also be of good quality.

Companies need a positive business climate, which can be promoted by good government policies, just as plants need air and water for sustainability. We do have fairly positive policies that allow companies to get started up quickly. We need to constantly look ahead to ensure our environment stay small business friendly.

The market place is the soil the plants grow in. We may not have a large domestic market, but we do have a domestic market that can sustain our SMEs. It would help if the government can make the soil richer by stimulating domestic consumption from time to time.

The seed represents the soundness of each company’s business ideas as well as the talents it has. Good programmes to cultivate our young to be more innovative and entrepreneurial can help seed improvements for our future SMEs.

Carving out space to grow strategic SMEs 

SMEs need space to grow, just as plants need space for sunlight to come through. In the rainforest where there were patches that giant trees were absent for whatever reasons, there were thriving smaller plants. The space vacated by the giants had allowed smaller plants to flourish. I had spoken previously on this. I will agree to disagree with some members of this House as to whether there’s crowding out by large trees, the industry giants. Beyond arguing about crowding out by large companies, I like our government to create fresh spaces for SMEs. It can do so by being a significant player in the economy to drive the creation of innovative SME-led solutions in certain key sectors.

For example, the government’s call for consumer and first-user of innovative solutions to be developed by local enterprises in the 2010 ESC report, backed by a $450 million co-innovation fund is the right step.

We can do more.

There is danger that there may be risk aversion by government officers to buy solutions from SMEs for fear of having to answer for failures, even if SMEs can meet specifications and offer lower prices than larger companies. We need to prevent this mindset. One possibility is to have smaller tenders that only SMEs can participate in. If there are no SME who can fulfil the requirements, then the tenders will be opened to larger industry players.

We can identify certain areas where there is substantial government demand and a strategic reason for us to have our home-grown innovative solutions. A positive example that comes to my mind is in water technology. We could have imported all the technologies but it was good that we chose to also go with local firms which allowed them to grow and compete in similar projects internationally. We need more of such successes. 

We have many public building projects ongoing now. We can use this opportunity to aggressively push the development of innovative home-grown green technology to be incorporated into the buildings. We could also use it to push for productivity improvements in our construction industry by insisting on productivity conditions and rewarding for innovation in productivity enhancements.

I also like to see policies requiring the public sector to favour green procurements. This can spur the development of our local suppliers to meet green standards that will allow them to compete for projects in countries that have already implemented such policies. Green procurement policies are already gaining traction in places like Taiwan, Thailand, Canada, Japan and Korea.

We can even dovetail this initiative with that of the Renovation and Refurbishment Deduction Scheme by having better tax deductions for retail and F&B outlets to adopt renovations that are eco-friendly.

I was encouraged recently to learnt that a local SME, Greenpac (S) Pte Ltd had developed an environmentally friendly packaging solution for a global eye-care leader CIBA Vision, that won the international WorldStar Packaging Award 2010. I learnt that not only was the solution eco-friendly, it also saved space, resulting in lower transportation costs and eliminated unnecessary unpacking and re-packing , which resulted in productivity gains for the client.

There was a call to use green lenses in government procurement in the 2010 ESC report. I like to see greater speed in legislation and in execution of this recommendation. We can certainly develop more local SMEs to become world leaders in the promising green technology industry.

Sir, I have confidence in the innovativeness of our SMEs to rise to the challenge when spaces are open up for them to demonstrate innovative solutions to meet our public projects’ needs.

The Necessary Mindset For 21st Century Singapore

I like to end with a story. I took a walk outside this House recently and noted the inscription on the statue of Sir Stamford Raffles by the Singapore River. It says “On this historic site, Sir Thomas Stamford Raffles first landed in Singapore on 28th January 1819 and with genius and perception changed the destiny of Singapore from an obscure fishing village to a great seaport and modern metropolis.”

Singapore has moved into a new phase of our development. The world has moved into a new century. There is a great need in this 21^st century to have our people to be genius and perceptive to spot gems of opportunities caused by constant upheavals. There will be plenty, brought about by constant technological advancements, political changes, and shifts in economic power. We live in an exciting world. Mark Zuckerberg, founder of Facebook became the world’s youngest self-made billionaire at just 23 years old four years after starting his business in the dormitory of his university. Such opportunity and speed are only possible today with the constant technological changes that break down old barriers and level the playing field for innovative newcomers. In this innovation-driven era, we need to empower our people through mindset change to achieve quantum leaps in productivity improvements.

Sir, We need people full of creativity, innovativeness, perception and daringness to find the next Angry Bird or Facebook in us. Sir Stamford Raffles took risk with Singapore, a small and undeveloped fishing island. In this age and time, we need to find in ourselves the genius, perception and risk-taking spirit to discover brave new worlds out there.

I like to conclude by saying that significant challenges lie ahead as our economy restructures. Our forefathers have worked diligently to get us to where we are. We need brace ourselves for changes to come, and find faith in our abilities to rise above the challenges, as we have done so in the past.

Thank you.

My debate in parliament on 19 October 2011

(Text of debate from the Singapore Parliament’s official records. Debate took place after my maiden parliament speech)

The Senior Minister of State, Prime Minister’s Office (Mr Heng Chee How): Mr Speaker, Sir, I would like to seek clarification from the hon. Member Mr Yee. When he referred to the NTUC group, was he saying that the NTUC group is a government-linked company or a grouping?

Mr Yee Jenn Jong: I am not referring to NTUC as government-linked. I am aware that it is Union’s. I am mentioning in my point that it as GLCs and cooperatives competing with local enterprises. It is “and”.

Mr Heng Chee How: Mr Speaker, Sir, may I remind the hon. Mr Yee that NTUC is not the only organisation that can form cooperatives. Anybody can form cooperatives. It is a legal form of business, and you can also do that and compete on an equal basis. I just also to want ask Mr Yee whether he is aware that NTUC co-operatives do not enjoy any special privileges.

Mr Yee Jenn Jong: Mr Speaker, I beg to defer on some areas from Mr Heng. There are certain areas I am aware about that NTUC do have privileges; for example, in the industry that I am fairly well acquainted with, the pre-school industry. Childcare spaces are given to organisations like the NTUC at a very highly subsidised rent. So, it is not true to say there is absolutely no advantages at all.

Mr Heng Chee How: Mr Speaker, Sir, I do not wish to belabour the point but with regard to the NTUC co-operatives of any sort, I wish to ask Mr Yee whether he is aware that these co-operatives have all been set up in relation to societal needs that have to be addressed and that this has been the Labour movement’s contribution to addressing and helping to address our nation’s needs. Where he referred to any perceived privileges that co-operatives might enjoy, that is because certain conditions might have been placed for community organisations that meet certain criteria and that it is not unique to the NTUC.

Mr Yee Jenn Jong: Let me just clarify that I am very well aware of the progress of NTUC and how it has provided many businesses from cradle to grave literally. And it has benefited perhaps many citizens. Today my speech is about the economy and about the impact of SMEs like organisations such GLCs and co-operatives. Sir, I will leave it to a future point where I will debate further about whether certain of these approaches by the co-operatives may be necessary. But today my speech is basically about the impact of SMEs and for the Government and even the co-operatives to consider whether they should play a smaller role in some of these areas because their presence has truly impacted SMEs.

BG [NS] Tan Chuan-Jin: Just two small points, Mr Speaker, related to the impact on big government, small government. For HDB public housing, the Member cited the example of DBSS to illustrate how that has gone awry. I am indeed puzzled as DBSS forms a very small percentage of what we are providing. A large bulk of our public housing is provided by HDB. So, that is a small point of clarification.

The other one is a small point on health care. We can agree to disagree, but the total expenditure of inpatient care for residents in 2009, for example, Medisave and MediShield financed 23%. About 51% was borne by Government and the remaining 27% by employers and patients. We could disagree whether 51% is significant, big or small, but I think that is something that we are looking at and that is the commitment of the Government on some of these areas.

Mr Yee Jenn Jong: Mr Speaker, the essence of what I was trying to say is that basically over the last decade, the Government has deliberately chosen a free-market approach. Now, there are certain merits in whether we use a free market approach or a planned, regulated approach as we have done so in the past.

By allowing the free economy to dictate things, you will over the long run let demand and supply sort itself out and things will eventually match up. But we have seen over the last few years that there are big problems in the three areas that I have just mentioned: housing, transport and healthcare. My premise for this that when you leave things to the free market, things do not catch up and people may be unwilling to take risks because having unsold flats, for example, does not look too good, and you will be questioned by the Auditor-General and so on. So, yes, on the DBSS, I am aware that there is not a big portion. I am citing it as a case that when you go too far and let the private economy take over the running, then there will be at some point in time when the profit elements from the private developers will set in and push things up. I do recognise that HDB provides the housing. What I am saying is that there is not enough drive by the Government to take a bigger responsibility, to take bigger risks to absorb more of these things, to plan the capacity ahead of time even if it means that it might not look so good on the books.

BG [NS] Tan Chuan-Jin: Mr Speaker, I think it is important to make this quite clear. Our commitment is to provide public housing for our people at affordable rates. We have acknowledged that demand exceeded supply in the last few years, and we will make that right and indeed with few subsidies. The Government plays a significant role and I will speak on behalf of my colleagues in HDB who, I think, have done a fantastic job of housing the bulk of population in good quality housing. We stepped in to provide a whole range of subsidies for our people. That is not the market. If we were to leave it to the market, we should just take a step back, close down HDB, let the market decide and you pay whatever price you deem fit for a country and city. That is the basis upon which we are committed to providing for our people and that is important to clarify.

Mr Yee Jenn Jong: Sir, I would thank Brigadier-General for clarifying. Yes, I am heartened to know that HDB has indeed done more and I believe it reflects that the Government has started to listen to the voices of the people after the last General Elections.

BG [NS] Tan Chuan-Jin: I fail to understand how as a result of your entry into Parliament, we suddenly started responding on that front. We have been providing good public housing for our people for many years. And, in the same vein as I responded earlier — perhaps imitation is the best form of flattery, and if you feel that it is important to take credit, it must be something good. So, thank you very much.

Mr Lawrence Wong: Mr Speaker, Sir, if I may seek clarification from Mr Yee. If I am not mistaken, he mentioned earlier that GLCs have been growing in size in the economy and that is crowding out SMEs. Then I would like to know: first, what is the basis for saying that the GLCs’ share of the economy has been growing over the years? Because the Government has been divesting. So, I would like to know what is his basis for saying that?

Secondly, because of the divestments, some things are now being done by the private sector but Mr Yee seems to think that that is not a very good thing and he cited the case of JTC Industrial Estate going out. He said that this is negative from the point of view of the SMEs. It seems to be conflicting because on the one hand Mr Yee advocates divestment, smaller GLCs, but on the other hand, when there are companies that are divested by the Government, Mr Yee mentions that it is not such a good thing. Perhaps he would like to clarify on these points.

Mr Yee Jenn Jong: Mr Speaker, I thank Mr Lawrence Wong for bringing up the case about JTC. I observed from JTC’s website whom they have divested to. I noticed that it is mostly to Mapletree. When I checked the shareholding of Mapletree, I think I would consider it as also a GLC. Some of it may have gone to Ascendas. So, while we may have moved it off a statutory board, we have actually moved it into a government-linked company of some sort.

The observations that I mentioned are just not my own observations. As far back as 2002, there was an Economic Review Committee that made various recommendations and I was very happy with those recommendations. But over time I have not seen many of them implemented especially on the SME space. I would like to see more aggressive moves to implement some of these measures. I am aware that perhaps a competition council has been set up. But in the areas of, for example, providing more support for the SMEs, I think that is also quite lacking. And the observation then in this report was that the GLCs have grown too big and that is also time for them to divest.

Mr Lawrence Wong: Mr Speaker, Sir, Mr Yee has not answered my first question: What is the basis for his claim that GLCs’ share is growing? As he said, in his speech, GLCs are growing in the economy and crowding out SMEs over time.

Mr Yee Jenn Jong: Sir, I think I have answered the question. It is not just my observation but in this particular report it did mention that the role of GLC has grown big and it is time to divest. This is a Government Economic Review Committee report.

Mr Lawrence Wong: Mr Speaker, Sir, the ERC was many, many years ago.

Mr Yee Jenn Jong: If the Member can share with me data perhaps at some other date, I would be happy to be proven wrong about GLCs not being big.

The Minister for Trade and Industry (Mr Lim Hng Kiang): Mr Speaker, Sir, on the clarification of JTC divesting in industrial properties. In the latest exercise that JTC did so, it was opened to everybody. JTC awarded half to Soilbuild which is a private company, and the other half to Mapletree which is also a private company.

The Senior Parliamentary Secretary to the Minister for Education and Minister for Law (Ms Sim Ann): Mr Speaker, Sir, as the Vice Chairman of Compass, I am always on the lookout for interesting new ideas from parents and the community about how we can improve our education. And I notice in the hon. Member Mr Yee’s speech just now that he introduced several ideas which we have also heard from lots of parents. We share these concerns but one idea so far which I have not come across from parents is the introduction of political education in schools. I find this very interesting and I would like to seek a clarification. Does the hon. Member think that our schools are an appropriate platform for us to introduce politics and, if so, what form should such education take and from what age?

Mr Yee Jenn Jong: Mr Speaker, on the question of political education, I think something very simple that we can start with is, for example, to understand the Constitution. So, perhaps, at the secondary schools, we can start looking at what does our Constitution mean, what are the roles of the Parliament, the Executive and the Judiciary. I am pretty surprised myself, talking to even students at university level where I used to teach at the start of my career, that there are actually many people who are totally politically apathetic about the environment. And one business leader I met several years back, who gives out scholarships, told me that he was rather disappointed with the quality of discussion with the university scholarship holders that his company has given out the scholarships to, because they cannot hold a proper discussion with him about ASEAN. So I feel that, yes, we should start. On exactly at what level – at secondary, it would be appropriate; at primary, perhaps, with some simple introduction.

Parliamentary Speech (19 October 2011)

Introduction

Mr Speaker, Sir, before I touch on the President’s speech, I like to add to the references on Bhutan, as well as correct misconceptions that had surfaced in this House. I happen to visit Bhutan just before this year’s General Elections and am now involved in a non-profit education project for the country.

Mr Cedric Foo joked that Bhutanese are happy because they have only 2 elected opposition members. Bhutan’s concept of happiness was implemented by the 4th King in the 1970s, long before they had parliamentary democracy in 2008. On my flight into Bhutan, I picked up this In-Flight magazine of Druk Air, their national airline. This page listed the 4 most important persons in Bhutan: His Majesty the King, the Chief Abbot, the Prime Minister and … the Leader of the Opposition. Speaking with Bhutanese, I was amazed at the respect they accorded to the Opposition, as well as to the democracy process.

Just as Minister Khaw said that developing Bhutan wants to learn from Singapore, there are useful lessons from Bhutan. The concept of Gross National Happiness is not some fuzzy feel-good about individual happiness as some members alluded to, but about collective happiness and long term sustainability. It does measure economic indicators, like all other countries. It also measures three other important areas: Preservation of Culture, Preservation of the Environment and Good Governance. Bhutan chose to do so because it wanted to leave something for future generations, rather than mine natural resources for short term gains or destroy the culture that made them unique. We have seen measures to prop up the economy, like liberal immigration and the casinos, which may bring immediate benefits but can lead to long term problems. Are Singaporeans happy with headline-grabbing economic growth when it is their jobs that have been impacted; when they struggle with high cost of living; or if family members face chronic gambling problems?

Sir, I will now move on to my main speech. I thank the President for reminding us to do our very best for our country and to make it the best home for all Singaporeans. I grew up in an independent Singapore. I have seen the changes we went through. Doing my best for Singapore is an aspiration that I share. Singapore is my home and my family.

The President touched on many issues. I will focus on education and the economy.

First, I like to declare that I have vested interest in the education space as an owner of several private companies offering education services, mostly to schools.

Education 

Sir, the President said that we should have “a truly special Singapore, where our children can grow to be the best that they can be.”

The main form of our current mainstream education started with the bold 1979 Goh report by the late Dr Goh Keng Swee, then Minister for Education. It was to address the challenges of the day. Streaming was introduced. Singapore went for mass production to raise the overall level of students’ performance.

Schools were differentiated progressively from 1988. From 1992, they were ranked yearly by MOE and the ranking were published. Next, MOE published schools’ actual versus expected performances. Ranking was later replaced with banding schools of similar range of students’ academic performances together. Today, while schools are appraised in non-academic areas, they are still banded by academic results.

The changes have raised overall education levels, but they also created excessive anxieties for parents and students, and widened public’s perception of quality between top and lower ranked schools.

An educator friend blogged that she had asked parents in workshops to draw their impression of our education system. One drew prison bars! There were similar drawings by other parents expressing helplessness at being trapped in the system. They felt helpless over the many high stake examinations; and pressure to get children into good schools, failing which they deem the future of their children would be compromised.

In a recent 938Live radio talkshow, a caller whose daughter was taking PSLE this year described how her family relationship became strained while preparing for the exams. A friend shared that his daughter in a top school cries frequently just before exams. I feel terrible hearing of children having their confidence crushed and growing up in fear of education. A former civil servant I met online wrote that he had migrated to Finland because he did not want to subject his son to the unhealthy system here. He wanted his son to simply love learning.

Today there is over reliance on academic performance as a benchmark of success and meritocracy, a phenomenon I call hyper-meritocracy. Hyper-meritocracy has seen parents who could afford it, pack children’s schedule with tuition.  A good paper qualification is seen as a guarantee to a successful career. The safe thing to do in Singapore is to score in exams, get a scholarship and land a secure good-paying job. This has led to a dearth of risk-taking and entrepreneurial spirit in Singapore.

I share Mr Teo Ser Luck’s observation that risk aversion will be a key challenge for him to promote entrepreneurship. The problem of lack of entrepreneurs begins in schools, where students are conditioned not to take risks and do not learn to handle ambiguity. In this aspect, I am happy to work with Mr Teo as I have been working with young entrepreneurs and students for quite some time now.

Sir, I am happy to note that MOE is looking into Character and Value-based education. Character and values are important guiding principles for life and must be imparted to students. However, schools are supposed to already have civics and moral education for years. MOE’s 21st Century Skills framework, already included character and values development. Schools, preoccupied with measurable indicators of success such as school ranking and academic grades, are known to have replaced civics periods with mainstream subjects. This sends wrong signals to children that values are not important.

Schools pile homework on students and drill them for major exams. I know of a top school which had three full-scale prelim exams in addition to mock exams using prelim papers of other schools, in order to prepare students for this year’s ‘O’ levels. Principals feel pressured into delivering academic results over other forms of holistic development.

We have had education policies with good intents before, but their effects were often muted because we did not address our examination culture.

At the heart of the issue is what good education should be about. Do we sieve out academic performers through a series of examinations so that we can concentrate them together? Is this so because we believe we need to identify the top 5% of each cohort who will run our country and our top companies in the future?

Today, we face a totally different world where what we know can quickly become obsolete. Nimbleness to change is essential for survival. We do not just churn out workers for the multinationals. We are competing against the world for investments, businesses and jobs. We need our people to be innovative and adaptable.

Mr Speaker, I hope two areas can be addressed:

1. Critically examine our intense examination culture. Can we cut down on streaming and do we need to start streaming so early?

 Finland, a country with about the same population size as Singapore, went the opposite direction with their education reforms, equalizing resources in schools and spreading talents across the system. They stream students only at 15 years old. Finnish students do well in international assessment benchmark. Notably, it has the shortest school hours in OECD countries and the narrowest gap between the high and low scorers, indicating education equity. Students hardly go for tuition. I feel it is useful to study their approach.

2. Broaden learning and seriously infuse character and values development.

Already schools are reluctant to offer subjects that are important to broaden students’ thinking, such as literature and history, as these subjects are difficult to score well in. Yet they are important for students to appreciate diversity, handle ambiguity and to develop critical thinking.

We should further broaden learning to include political education so that students can grow up with a wider spectrum of thoughts. Perhaps, they can then develop the Digital Quotient that Dr Lam Pin Min spoke about and can become responsible participants in our evolving parliamentary democracy.

Today, we appear more educated. However, I am not sure if we are more learned and more innovative, or we are simply more exam-smart.

I like to share a story with this House. Recently, I met a Singaporean couple who run an international school in Bangkok. They shared the experience of their daughter.  Jazlina retained a place in a Singapore school under overseas leave of absence. She returned in primary 6, took her PSLE and was admitted into an autonomous school. She spent her secondary two in Singapore.

Jazlina is a bright and self-motivated girl who had thrived in school while in Thailand. But under our system, she felt constrained trying to conform to a rigid regime expecting standard answers. With a class size of over 40 students, her mother had to put her through tuition to keep pace with the class. Jazlina started to lose self-confidence and told her mother that ‘maybe I am not so smart after all’. At secondary three, she was streamed into a subject combination that was not her passion. After fighting the system for a few more months, the family put her back into their own school in Thailand.

Jazlina blossomed again. She now represents Thailand in international debating competitions, where she has won prizes. At this year’s iGCSE exams, Jazlina aced all her subjects and scored 100% in two subjects, including for the subject of her passion which she was not selected to take in Singapore.

Her mother shared that had they not brought her back into a more nurturing environment, her confidence would have plunged further. She felt that Singapore’s system was not bringing out the best in Jazlina, but was instead drowning her.

Mr Speaker, Sir, the President’s call for our children to ‘grow to be the best that they can be’ is a great ideal. Like Mr Lawrence Wong, I believe that education should light up fires in children. We have to deal with many like Jazlina, who are talented and passionate, but constrained by the system. Instead of being obsessed with picking out winners, education should make winners out of the ordinary.

We may have done well in the past. Based on that, we entrench our processes further without critically considering the changing environment or the negative effects. It has been 32 years since the Goh Report. I believe it is time to make bolder evaluation of our mainstream education.

Economy

Sir, next, I like to talk about the economy. I feel the government has become small in areas it should be big in, and big in areas it should be small in.

In the last decade, Singapore has adopted a free market approach for many government services. Some areas like the provision of public housing, public transportation and health care, which are essential social responsibilities of the government, have gone this route too.

My colleague, Gerald Giam had touched extensively on the under-capacity of hospital beds, public transport and housing as a result of this policy. We outsource critical areas to the private sector and hence we had issues such as DBSS which had caused unhappiness due to public housing being pushed to unaffordable levels.

The government chose to play a smaller role in the provision of essential services. It passed these responsibilities to the free market. With a free market mindset, the government was not prepared to take risks. As a result, Singaporeans bore the cost of the under-provision.

On the other hand, in areas that the government should play a smaller role, it has instead grown bigger.

As our economy developed through the years, instead of letting private enterprises take more initiative in the economy, our government’s share of the economy has grown through its participation in Government Linked Companies or GLCs. This is in contrast to countries like South Korea and Taiwan whose governments also had helped pioneered some key businesses but progressively withdrew to let the private sector drive growth thereafter.

The NTUC group is a large cooperative with a stated US$3.5 billion annual turnover from its website. GLCs and cooperatives like NTUC inevitably compete with local enterprises, making the domestic market even smaller for them.

A Straits Times Forum writer wrote last week to share his experience as an entry-level entrepreneur in Chinatown Complex. In May this year, NEA engaged professional valuers to appraise the value of the complex. Rent went up by 71 to 100% as a result.

Keeping rental cost manageable is important to the survival of small enterprises. In the past few years, JTC divested many of its properties to Real Estate Investment Trusts. I noted that rental cost of former JTC spaces have gone up as a result, an observation shared by SME leaders in an article in the Straits Times today. Hence, SMEs today struggle with high rental cost on top of challenging manpower cost.

SMEs sometimes also suffer in tenders due to risk aversion by government officers who may shun smaller companies even if the solutions offered have met specifications at lower costs. To promote the growth of SMEs, the government could look at ways to allow GLCs to participate only in tenders above certain minimum values. Or GLCs and cooperatives should withdraw totally from non-essential market segments if SMEs are capable of fulfilling local demands.

I believe there’s merit in encouraging SMEs to develop themselves further with a mindset of professionalism, precision and perfection. In some developed economies like Germany and Switzerland, there are vibrant cottage industries comprising long established family-run businesses. They have generations of know-how that have allowed their products to be sought after despite competition from lower cost countries.

SMEs create jobs. Those that have succeeded locally could end up as global winners. In Singapore, we also have our cottage industries. I am happy to note that we have long established food brands like Tee Yih Jia, Sin Hwa Dee, Polar Puffs and others that have been able to scale globally. It is imperative that Singapore provides the conditions to develop more of such local enterprises.

As we move forward to strengthen our economy, I hope the government can consider right-sizing itself in the appropriate areas. I like to see it being big in providing essential social services. I like to see it become small in running domestic businesses and leave the space to grow our SMEs.

With that, Mr Speaker, I support the motion of thanks.