Singapore Budget 2017: Feeling the way to the future, one step at a time
Every Budget plans for the future. But in Budget 2017 especially, the future it wants Singaporeans to work towards together is very much a work in progress, and the road ahead a particularly uncertain one.
This year's Budget was always meant to be viewed in tandem with the Committee on the Future Economy (CFE) report and looking at both together helps one piece together a picture of how Singapore Inc is meant to get from today to that uncertain tomorrow.
To recap: The CFE report outlines Singapore's place in a volatile future. It says that to be future-ready, Singaporean workers and companies need to deepen skills, strengthen enterprises, build international connections, digitalise and develop a vibrant city.
How to do this? Deputy Prime Minister Teo Chee Hean summed up the CFE report on his Facebook page in a useful post three days ago, saying there are two implementation strategies: Via the Industry Transformation Maps (ITMs), and via a spirit of partnership together.
At the heart of that journey to the future are the ITMs for 23 sectors, to boost innovation and productivity. Whether Singapore remains business as usual, or becomes more productive, innovative and a more fun place to live in - depends in large part on how those ITMs transform life as we know it in Singapore.
ITMs for six sectors have been launched, and the rest will be rolled out this financial year. To get a glimpse of the transformative power of those road maps, consider the food services sector. Singaporeans would have noticed the rapid rise of delivery apps that work with restaurants across the island to bring food to your home, the increasing use of iPad menus that do away with the need to get wait staff to take orders, and the seemingly endless rise of food-related start-ups that leverage on technology and new food- preparation methods.
In logistics, another sector with an ongoing ITM, there are plans for a nationwide system of lockers - for all those shopping online - so you don't have to stay home to await a delivery.
Plans are afoot too to consolidate truck delivery to malls. Each day, about 4,000 trucks perform 20,000 delivery trips, taking up 25 per cent of road space. Can logistics firms coordinate delivery - so that goods for different retailers can be picked up from warehouses and sent to the same mall, rather than have multiple trucks sent to the same mall? This already happens in Japan.
A government study suggested that such a system can yield manpower savings of 40 per cent, shorten waiting and queueing time for deliveries by 65 per cent and cut the number of trucks on the road by 25 per cent.
How are these interesting ITMs developed with such granularity? Through painstaking and joint efforts by government officials, companies, industry associations, unions and experts. The key is lots of horizontal links, learning from similar companies outside Singapore, and looking for companies in Singapore that might have a particular solution, or software, that can be customised for a particular need.
In a word: through partnership. Finance Minister Heng Swee Keat stressed that these ITMs are not top-down blueprints, but are "live" plans to be adjusted along the way. Indeed, the "I" in ITMs might better stand for iterative.
The other sectors for ITMs - that include healthcare, education, infocomms technology and media, energy and chemicals, aerospace, cleaning, real estate - cover 80 per cent of the economy.
As a consumer, and a worker, I am rather looking forward to seeing how the remaining ITMs will unfold. Will there be laundry sorting and folding robots? Location-based property apps that tell you which homes are open for inspection as you near an area (already ubiquitous in Australia)? Data- mining companies that can help newspapers monetise eyeballs?
Apart from the ITMs, other strategies in the CFE were also fleshed out in this Budget report.
For example, on the need for companies to digitalise, a new initiative called SMEs Go Digital will see the Info-communications Media Development Authority work with Spring and other agencies to develop industry digital plans to help SMEs improve productivity, including in retail, food services, logistics and cleaning.
On the need for companies to develop international links, a $600 million international partnership fund will co-invest with Singapore-based firms to help them scale up globally.
A Global Innovation Alliance to be sited in innovation hubs around the world will run programmes for tertiary students to expose them to start-up opportunities, for entrepreneurs to link them with investors, and for local companies to link up with innovative foreign firms keen to test-bed products in Singapore and the region.
To build talent, an initiative of over $100 million will build enterpreneurship networks overseas and encourages companies to groom Singaporean business leaders. In all, $2.4 billion will be set aside over the next four years to implement the CFE strategies. The other funds include: $150 million for the Public Sector Construction Productivity Fund, a $500 million top-up to the National Research Fund and a $1 billion top-up to the National Productivity Fund.
While many of the measures in the Budget are foundation stones for the future, Mr Heng also took pains to address firms' more immediate concerns. Struggling companies in marine and offshore engineering will get bridging loan support, while the marine and process sectors will get a reprieve from a hike in foreign worker levy for a year. Wage support measures for employers to keep older workers will continue. There is also a corporate income tax rebate of 50 per cent of up to $25,000 (from $20,000 last year).
Those who found no clear road map in the CFE on how Singapore is to prepare for the future are not wrong. The CFE report gives only an overview of what an uncertain future looks like, so it is no surprise that those well-read on future trends find little of what it says fresh. Nor are its recommendations - deepening skills, regionalising, and innovating - revolutionary.
Those who turn to this year's Budget expecting detailed blueprints may also be disappointed. But in a Vuca future (that ubiquitous acronym to describe the world today - volatile, uncertain, complex and ambiguous), no blueprint, or map, can chart the way forward.
Rather, with the ITMs' "live" plans, we can only journey on, feeling the way forward together, one sector, one company, one app, one innovation at a time, mindful that at each turn, we will keep needing to do what GPS systems always do when we veer into new paths: recalculating.
In an earlier version of the article, we said that a "$100 million initiative encourages companies to groom Singaporean business leaders". The sum of over $100 million is for both the SkillsFuture Leadership Development Initiative (LDI) and Global Innovation Alliance.
We also said that "ITMs for six sectors have been launched, and the rest will be rolled out this year." The ITMs will be rolled out by the end of Financial Year 2017.
We are sorry for the errors.
Sent from my iPhone