Difficult Changes Paying Off In High Growth For S'pore: PM

Source : The Straits Times, Oct 30, 2007

Resulting achievements getting noticed by the world; Mr Lee pays tribute to crucial role played by labour

SINGAPOREANS can expect this year to end on a high note. Pointing to the 7 to 8 per cent growth forecast, Prime Minister Lee Hsien Loong said yesterday that Singapore 'can achieve the high end of this range'.
And he praised the labour movement here for the crucial role it played in helping to seal this strong position.

This rosy state is not only drawing investments but attention too, he said, highlighting an article in the latest Economist magazine.

The weekly described Singapore as 'booming, bustling and bursting at the seams...a developed country that grows at developing country rates'.

But this was not achieved by 'coasting along', PM Lee said at the opening of the three-day National Delegates Conference of the NTUC.

He traced the many difficult adjustments Singapore made over the years - and continues to make, like the recent CPF reforms to ensure enough savings for old age.

He also highlighted the sacrifices workers made for the long-term good, like taking cuts in their pay and CPF contributions.

Unlike many countries, Singapore could introduce these changes for one major reason: It has the strong support of the labour movement.

'For this, I'm very grateful to you, and so is the Government and so is Singapore,' Mr Lee told about 1,000 unionists and observers at the event, held every four years to elect new leaders and map out NTUC's future direction.

But adapting to change is crucial for Singapore to remain competitive, he said, adding that from time to time, more major policies will be introduced.

He cited the coming Land Transport Review to improve the public transport system and measures to provide good and affordable health care.

He pointed to upcoming measures in January to tackle road congestion, as well as likely means testing in hospitals, to ensure the needy get more subsidies than the higher-income group.

As Singapore powers ahead, countries like Hong Kong seem to be watching closely, said Mr Lee.

Noting how Hong Kong cut by one percentage point its business and personal taxes earlier this month, he said: 'They didn't say so but I think they must have watched what we did in Singapore in February in our Budget.'

Singapore cut its corporate tax to 18 per cent and Hong Kong's is now 16.5 per cent.

But such cuts are not all that foreign companies look for when investing.

Referring to Norway's Renewable Energy Corporation, Mr Lee noted that Singapore beat about 200 other sites in attracting the $6.3 billion facility here to make products for generating solar power. A key factor in its decision is Singapore's skilled, reliable and adaptable workforce, he said.

Credit must be given to the labour movement for results like these, he added, because union leaders help shape - and sell - tough policies that keep Singapore competitive.

He also praised the unionists for helping to keep Singapore 'open and flexible' to adapt to globalisation.

One example he cited was the hiring of foreign workers, a point taken up by labour chief Lim Swee Say when he gave NTUC's report card.

Mr Lim said Singapore's openness towards hiring foreigners gave companies the confidence to come here, despite the tight labour market.

'Because they know (we will) complement the shortage...with foreign manpower to ensure jobs are being done.'

Looking ahead, PM Lee said the labour movement will continue to play a key role as Singapore faces the uncertainties in the financial markets sparked by the US sub-prime mortgage troubles.

It is unclear how badly Singapore will be hit if there is a recession in the US. But its links with rapidly growing China and India would help see it through, said Mr Lee.

But one thing is certain of Singapore, he said, as he ended his 45-minute address.

It is the 'winning formula' founded in the close relationship between government, unions and management.

'Let's build on it...keep Singapore always at least one step ahead of the competition. Then we can offer a brighter future for all Singaporeans.'

PM ON MEANS TESTING
'One measure which we will need to do, in particular, is to target the subsidies from the Government towards the lower-income group who need these subsidies most. That means we need means testing to achieve this.

We already have means testing in nursing homes and we now need to start to implement it in hospitals too.'

Transcript of PM's speech - http://tinyurl.com/2d2zcq