Good Things Must Share: Budget 2014

Singapore Skyline (2013)

It’s been a while since the Budget was announced, and since then the only thing that seems to have continued echoing is this thing called the Pioneer Generation, and the size of their packages.

I’m not saying that my father’s generation – the one that built the republic’s foundations – doesn’t deserve the recognition or the reward that were supposed to come with it. But that’s not the point of the Budget for me.

Any national fiscal measure is a measure of the direction the Government wants the country to head towards. And for the most part, I agree with where it wants us to head: A high tech, high productivity economy.

There’s never been more money being poured into grants and rebates for productivity, innovation, and internationalisation. It’s easy to bandy these terms around, but the thought behind it is that we’re looking to look after the people that do the work.

This means measures to ensure we don’t over rely on cheap foreign labour again. I don’t like seeing companies that employ a whole bunch of foreign unskilled labour and deploy them higgledy piggledy just because they can afford to, and I’m happy cheap labour supply has been tightened, and that companies are finally looking to innovate to save costs.

As a small business owner, I’ve been witness to how rising costs have forced me to innovate and abandon old practices. Rising rental costs were killing me and my ability to retain a headcount – so off went the receptionist/admin staff, finance manager and other staff. I opted for a cloud based, paperless billing/accounting/time-costing system that I’ve subsequently become a reseller for.

I don’t have to have a finance or accounts clerk to chase late invoices because my cloud accounting system does that for me with increasingly curt emails (best thing ever). When clients call to ask questions about their file, I can answer their query almost anywhere thanks to my files being electronic and in the cloud. There’s no need to call up the office to get a staff member away from their tasks at hand to answer a simple question.

There are so many other options available that would make your existing staff’s lives easier, and encourage other potential job seekers to upgrade and train themselves so their jobs are multi-faceted, multi-skilled.

The fantastic thing in the Singapore context is the fact that all these things can be subsidised. Actually, subsidisation is an understatement. The Government is practically paying businesses to modernize.

Take the Productivity and Innovation Credit (PIC) for example. You get a 400% write off in your business’ tax returns (for businesses that employ 3 or more local staff), meaning if you buy a $1,000 computer, it is worth $4,000 in your tax returns, so you pay less in taxes.

But if you were making a loss, no worries – the scheme lets you get a cash rebate of 60% for your purchase. So if you were to buy a $1,000 computer, dis Gahmen GIVES YOU BACK $600!

DIS KIND OF LOBANG WHERE CAN FIND LIDDAT? SRSLY!

And if you think that’s like ZOMG WLE SIGN ME UP NAO, there is more money being thrown your way to make your company staff’s lives easier.

After getting an e2i Inclusive Growth Programme (IGP) discount of 50% off your productivity purchase, if you spend more than $5,000 in a qualifying period and you have claimed a PIC grant of 60%, you are eligible for a (taxable) additional cash grant of 100%. Confused? Nair mind.

Exempli gratia: You purchase $12,000 of several computers, machinery, and software that make your staff’s lives easier and more productive.
You get 50% e2i IGP discount and only spend $6,000.

You successfully claim a PIC cash payout of 60% or $3,600. THEN DIS GAHMEN WILL NOW GIVE YOU AN ADDITIONAL $6,000! OMGWTFBBQ DIS IS THE REAL GREAT SINGAPORE SALE!

Is this Budget serious about supporting SMEs and making lives of workers better? How about you read the previous five paragraphs to answer the question?

You’ve probably also heard about the increase in CPF contribution rates for the over 55s. There’s just not enough in workers’ CPFs to cover retirement necessities, partly because of how much older Singaporeans are when they do finally get married and have kids, and how much more our life expectancies have increased.

I’m glad dis gahmen is also implementing grants to cover the increase in employers’ contributions. Of course, thanks are in order to NTUC for pushing the idea of increasing employers’ contributions to the lawmakers.

There’s also other monies to tap on if you’re interested in improving workers’ skills – the Lifelong Learning and Continuing Education Fund has now been topped up to $4.6b. Again, these funds and schemes have been pushed by NTUC for several years now.

You can call it the happy circle of life – happy employees, productive company, better products, and happier customers. The ball is firmly in our court to put the money to good use – make your employees happier, more productive, more skilled and make your staff and your business continue to be the backbone of the Singapore economy.

Incentives To Wean You Off Cheapsourcing

At the last management council meeting of the last year at my condo, we were presented with a request by the cleaning company for a 20% contract fee hike. The managing agent then presented us with three other quotes that hovered around the old fee mark. We opted to terminate the incumbent and go with the cheaper one. 20% was just too much.

The contractor gave the usual reasons – gahmen tightening supply of labour, and the mandated progressive wages about to hit the industry.

The Progressive Wage Model did indeed ‘hit’ last month, in a better way than I thought – in an incentive (basket, early nair say) worth a total of $5M for buyers of services – meaning we could’ve stayed with the old cleaning company, and NTUC’s Progressive Wage Incentive would’ve foot part of the bill.

That’s a nice cushion for buyers since it is now compulsory for cleaning companies to implement the Progressive Wage Model – Lim Swee Say’s betterer version of the minimum wage. Cleaners will now have better entry pays (at least above $1,000 per month), with clear pathways to higher pay based on work experience, skill upgrading and productivity improvements.

That, together with other grants (from the e2i) means that outsourcing industries like cleaning companies and security businesses can look at vendors of machines, systems and services that improve their productivity so they can provide the same level of service for clients without having to jack up prices 20% all of a sudden. (Which, in the words of a member our management council – “wah lao, one time so high, is too much”).

I also sat through a particularly dry presentation (sorry ah, presenter) by the Changi Airport Group during the Best Sourcing Symposium at the e2i, and managed to glean something – that with passenger number increases over the last five years, the adoption of best sourcing practices has somehow managed to keep the contract cost and number of cleaners relatively low while maintaining cleanliness standards.

There are ways for companies and buyers to bite the bullet and shift towards a more productive and innovative mindset, and seriously, you can get a discount via the Progressive Wage Incentive if you’re one of the first to do it. Apply now before it runs out!

Two Kumars

I’m spending a lot of time writing Kumar’s (and several others’) script for Happy Ever Laughter 2014, and I’ve been explaining to Kai what I’ve been doing at work as well.

Then we came home one day, and as we were driving past the guard house, our night guard, whose name is also Kumar, waved his customary wave at Kai, who reciprocated.

Kai then told me matter of factly, “This Uncle Kumar doesn’t wear a dress”.

So I said to him proudly, “He can if he wanted to”.

Making Sure People #WORKRIGHT

Spreading the #WorkRight word
Spreading the #WorkRight word

A couple of Saturdays ago, mrbrown and I were invited to watch the community theatre group theVoice perform a song and dance skit at Tiong Bahru market’s food centre.

It was a little bit cheesy, but the enthusiasm of the troupe made up for that. Besides, the idea was to raise awareness of workers’ rights, especially those of lower waged ones.

When companies that buy services from providers, sometimes this puts the squeeze on those who bid – and the pressure eventually trickles down to the people who do the actual work – the cleaners, factory workers, kitchen staff – who aren’t as well versed on their rights under the Employment Act and the CPF Act.

(Employers like myself are very, very well versed with the CPF Act, actually. Just you try forgetting to pay CPF to your employees – in my case, myself – and your friendly neighbourhood CPF Compliance Officer calls you faster than you can spell CPF).

There are some common misconceptions which are often gleefully perpetuated by employers:

  • Staff not eligible for CPF because part time
  • Not eligible for CPF because not Singaporean
  • CPF is optional. You can opt out and get more cash
  • No need to be paid regularly because never sign contract
  • Contract says you are paid only if the company is hired for job

More recently I even read about a case where someone complained to the CPF about the employer actually taking the employer’s contribution out of the worker’s salary. Bastard right?

It helps if every one of us knows that there are avenues of redress. There are many lower waged workers who don’t know their rights, and as you can imagine, not everyone has access to the slew of information available online. Many of these workers do in fact trust that their employers are telling them the truth, and unfortunately, this trust is sometimes betrayed by unscrupulous bosses.

Whether or not we are employers, I do think it is every one of our responsibility to help inform low wage workers of their rights under the law – which in my opinion is just as important a facet as raising their wages.

NTUC Never U-Turns!

So there was an Op-Ed piece in yesterday’s ST by Han Fook Kwang, no less, which seems to say that the union movement made a u-turn in their policy on having a mandatory minimum wage. How many times must say liao, that it is not a minimum wage? NTUC never u-turns, understand? It might upturn once in a while, with a song, even, but never u-turn, can?

Besides, Lim Swee Say has been saying things in favour of the Progressive Wage Model since he was Environment Minister, and that was a long time ago.

But seriously though, even if I can’t prove conclusively that having a mandated minimum wage across sectors would sabotage the economy, I think that the progressive wage model is quite a good idea. Pegging wage increases (which already come with public assistance) with job and skill enhancements and pouring public funds into assisting training programs so that employers adopt them sounds good enough for me to support it.

I just hope the usual naysayers would take a closer look at what the Progressive Wage Model entails and how much public funding is going into supporting lower waged workers before they criticise every quarter for not helping. And then if they still must say nay, try to come up with a better alternative.