Our standard of living is not high by 1st world standards.
A high standard of living = high consumption as a percentage to wages, working fewer hrs and more free leisure time and a debt free existence.
It is our cost of living that is high!
Transformation will be painful'
But though results are not absolutely certain, strategy is 'the correct one': SM Goh
by Leong Wee Keat
05:55 AM Mar 02, 2010
SINGAPORE - The Singapore worker has been down this path before and cannot be said to be unfamiliar with the current productivity push.
Yet, going by their questions last night, there was uncertainty about the road ahead among Marine Parade GRC grassroots leaders at a Budget dialogue with Senior Minister Goh Chok Tong.
Given the Republic's open economy, how confident is the Government that the productivity push will boost economic growth, asked one grassroots leader.
Another wondered if retraining of the Singapore worker will prove sufficient in the face of companies' outsourcing practices. "How will our worker set their (productivity) vision if they are uncertain about their future in the company?" she asked.
Mr Goh said the Government was "confident" the strategy of raising productivity is "the correct one".
But he "cannot say with 100-per-cent confidence" that Singapore can achieve the goal of increasing productivity from 1 per cent to 3 per cent.
And in some cases, there may be some short-term pain, he acknowledged.
One grassroots leader, who owns an Indian vegetarian restaurant, said his business may suffer as he stands to lose a chef from India, who cooks the restaurant's signature dish, as a result of changes to foreign worker levies.
When Mr Goh asked if he could cook the dish, the restaurant owner replied: "I can do that, but I alone cannot run the restaurant myself."
"If I do that only, my productivity is much lesser," he added, drawing laughter from the 200-strong audience.
But the Senior Minister acknowledged the restaurant owner's "dilemma". "Your profits will go down, but this is the real difficulty of the transformation of the economy. There is pain," Mr Goh said.
The pain may also extend to some Singapore workers who, despite retraining, face companies outsourcing operations. "We have to be realistic. You cannot promise that everybody who is prepared to be upgraded, who trains himself, will get a job at the end of the training exercise," he said.
But even if the retrained worker may not get a job immediately, a job would eventually be ready for the worker, Mr Goh added, if he or she has the right attitude and the right skills.
Minister's wages: A Productivity component?
In his opening remarks, the Senior Minister said the Budget aims to transform the economy and bring it to a higher level, even though it is "unexciting" to the ordinary Singaporean.
And other than the productivity issue, he fielded questions at the 90-minute dialogue on a range of issues, from dependents' tax relief to the aging population and political salaries.
Since Ministers' salaries are tied in with economic growth, one grassroots leader suggested that a productivity component be included.
Mr Goh replied that policymakers can consider his suggestion, even though economic growth already accounts for productivity growth.
"At the end, the public and the Government must be satisfied that the pay level for the Government is competitive with the private sector, and that you are not overpaying the Government sector," he added.
What if the goal's not met?
But what if Singapore does not achieve its goal of raising productivity growth from around 1 per cent to 2 to 3 per cent within 10 years? What is the Government's contingency plan, asked one grassroot leader.
To this, Mr Goh said, "If we can't achieve our 3-per-cent growth, we achieve 2, 2.5, we will say, 'It's not bad', because 3 per cent is aspirational, we think we can do it."
But if productivity does not double, at least, "then you will have a real problem and you will see this in terms of the economic growth since we are tightening on labour force input, from foreign workers especially".
"That means our wages will go down," he said.
Raising productivity, Mr Goh added, was essential for the Singapore economy to transform itself to compete against developed countries, "and more importantly against China, India and Vietnam".
The Government is confident about raising productivity as the Republic has the resources and the creativity to do it, Mr Goh said.
This, even though the productivity push now will be more challenging than in the past.
"It is a very big problem that we have, trying to raise your standard of living that is so high, up by another few per cent," he said.
It is like climbing a mountain - the first 1,000 metres no problem, the next 500 metres big problem, and the last 100 metres, big big problem."
A high standard of living = high consumption as a percentage to wages, working fewer hrs and more free leisure time and a debt free existence.
It is our cost of living that is high!
Transformation will be painful'
But though results are not absolutely certain, strategy is 'the correct one': SM Goh
by Leong Wee Keat
05:55 AM Mar 02, 2010
SINGAPORE - The Singapore worker has been down this path before and cannot be said to be unfamiliar with the current productivity push.
Yet, going by their questions last night, there was uncertainty about the road ahead among Marine Parade GRC grassroots leaders at a Budget dialogue with Senior Minister Goh Chok Tong.
Given the Republic's open economy, how confident is the Government that the productivity push will boost economic growth, asked one grassroots leader.
Another wondered if retraining of the Singapore worker will prove sufficient in the face of companies' outsourcing practices. "How will our worker set their (productivity) vision if they are uncertain about their future in the company?" she asked.
Mr Goh said the Government was "confident" the strategy of raising productivity is "the correct one".
But he "cannot say with 100-per-cent confidence" that Singapore can achieve the goal of increasing productivity from 1 per cent to 3 per cent.
And in some cases, there may be some short-term pain, he acknowledged.
One grassroots leader, who owns an Indian vegetarian restaurant, said his business may suffer as he stands to lose a chef from India, who cooks the restaurant's signature dish, as a result of changes to foreign worker levies.
When Mr Goh asked if he could cook the dish, the restaurant owner replied: "I can do that, but I alone cannot run the restaurant myself."
"If I do that only, my productivity is much lesser," he added, drawing laughter from the 200-strong audience.
But the Senior Minister acknowledged the restaurant owner's "dilemma". "Your profits will go down, but this is the real difficulty of the transformation of the economy. There is pain," Mr Goh said.
The pain may also extend to some Singapore workers who, despite retraining, face companies outsourcing operations. "We have to be realistic. You cannot promise that everybody who is prepared to be upgraded, who trains himself, will get a job at the end of the training exercise," he said.
But even if the retrained worker may not get a job immediately, a job would eventually be ready for the worker, Mr Goh added, if he or she has the right attitude and the right skills.
Minister's wages: A Productivity component?
In his opening remarks, the Senior Minister said the Budget aims to transform the economy and bring it to a higher level, even though it is "unexciting" to the ordinary Singaporean.
And other than the productivity issue, he fielded questions at the 90-minute dialogue on a range of issues, from dependents' tax relief to the aging population and political salaries.
Since Ministers' salaries are tied in with economic growth, one grassroots leader suggested that a productivity component be included.
Mr Goh replied that policymakers can consider his suggestion, even though economic growth already accounts for productivity growth.
"At the end, the public and the Government must be satisfied that the pay level for the Government is competitive with the private sector, and that you are not overpaying the Government sector," he added.
What if the goal's not met?
But what if Singapore does not achieve its goal of raising productivity growth from around 1 per cent to 2 to 3 per cent within 10 years? What is the Government's contingency plan, asked one grassroot leader.
To this, Mr Goh said, "If we can't achieve our 3-per-cent growth, we achieve 2, 2.5, we will say, 'It's not bad', because 3 per cent is aspirational, we think we can do it."
But if productivity does not double, at least, "then you will have a real problem and you will see this in terms of the economic growth since we are tightening on labour force input, from foreign workers especially".
"That means our wages will go down," he said.
Raising productivity, Mr Goh added, was essential for the Singapore economy to transform itself to compete against developed countries, "and more importantly against China, India and Vietnam".
The Government is confident about raising productivity as the Republic has the resources and the creativity to do it, Mr Goh said.
This, even though the productivity push now will be more challenging than in the past.
"It is a very big problem that we have, trying to raise your standard of living that is so high, up by another few per cent," he said.
It is like climbing a mountain - the first 1,000 metres no problem, the next 500 metres big problem, and the last 100 metres, big big problem."
