26 March 2012

Giving Businesses Greater Flexibility

26 March 2012

The Government’s manpower policies aim to help our companies grow, and provide jobs for Singaporeans. We conduct regular dialogues to gather feedback and discuss how best to shape our labour landscape. During the recent Budget Debate, there were a number of comments and suggestions raised in Parliament. Among them was Ms Foo Mee Har, who appealed for greater flexibility in applying our foreign worker policies. 

To recap, the Government had announced several measures to reduce dependency on foreign workers in Budget 2012. The measures basically mean that companies will be able to employ less foreign workers. A move necessary to limit the number of foreign workers to ensure our locals remain at the core of Singapore’s workforce.

However, Ms Foo highlighted that the foreign worker restrictions may have come at a time when businesses are trying to cope with several challenges - escalating costs, a tight labour market and an uncertain economic environment. Should these companies fail, it could put the livelihoods of many Singaporeans at risk, as these companies employ our locals as well.

Her concerns were echoed by many other MPs in Parliament. We also received similar feedback through our various industry dialogues, discussions and even emails from employers themselves. 

For example, the President for the Singapore Contractors Association Limited, Dr Ho Nyok Yong, felt that the government’s policy of limiting the amount of time foreign workers can remain in Singapore has led to a situation where construction companies need to invest time to train batch after batch of workers in basic skills. 

I am very aware of these concerns. In fact, many of you have conveyed to me your thoughts on this matter when we meet. I would like to say that we hear your feedback and have considered them very carefully. 

As mentioned by Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam in his Budget Debate Round-Up Speech on 1 March, we have reviewed the suggestion by Members of Parliament Mr Ang Wei Neng and Ms Tin Pei Ling to allow companies to keep their experienced and trained foreign workers for longer periods, as long as they operate within their Dependency Ratio Ceilings. 

We recognize the merits to the suggestion and have spent some time considering how best to adjust. We believe that retaining well-trained and experienced foreign workers would increase a company’s productivity, as it would spare them from having to re-hire and re-train another foreign worker. It also has a positive impact on safety and socialization considerations. 

Therefore, from July 2012, the Ministry of Manpower will extend the maximum Period of Employment, for unskilled Work Permit holders from Non-Traditional Sources - from Bangladesh, India, Myanmar, Philippines, Sri Lanka and Thailand - and the People’s Republic of China, from the current 6 years to 10 years for all sectors. 

This measure does not impact Work Permit holders from Malaysia, North Asian Sources and foreign domestic workers as they do not face a POE restriction and can work up to 60 years old. To find out more details, you can visit our website at

I believe that effective Governance includes gathering feedback from all quarters, and where possible, make adjustments to ensure our policies are flexible and responsive to the changing business landscape. 

We have also been discussing with businesses on the possibility of granting them more flexibility in how they deploy their foreign workers, across job duties within the same company, to boost their efficiency and productivity. However, this will depend on the outcome of a pilot run that will be carried out by the second half of this year for the Hotel industry. 

Businesses should remember that they need to do their part as well - while the Government strives to keep Singaporeans at the core of our workforce, we also strive to keep our local businesses at the core of our policies, and help them upgrade and improve their productivity. 

Co-creating our policies can take place in many forms. While we may not always be able to adopt all ideas, we will definitely consider ideas which will improve the quality of life for Singaporeans. Do continue to share your views with us! 

(If you have feedback on our current policies or if you have a suggestion to improve our current processes, you may share your ideas on our iSuggest portal at
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