Singapore—At the Budget debate in Parliament on Wednesday (Feb 26), Workers’ Party (WP) MP Sylvia Lim proposed the implementation of unemployment insurance for older workers who have been retrenched. Manpower Minister Josephine Teo said that the Government would “keep an open mind” to the suggestion, but called the present support given to such workers “more sustainable.”
This insurance is targeted at protecting employees whose work may become redundant, which is why it is also called redundancy insurance. Under unemployment insurance, retrenched workers would receive a payout.
Ms Lim said at the Budget debate, “Today’s economic climate illustrates how such insurance could provide a stabiliser to workers, to soften the cliff-edge that they face with job disruption.
If the anxiety of citizens is not taken seriously enough, the door to populism and nativism will widen.”
TODAY reports Ms Teo as saying that providing unemployment insurance would lessen the motivation of workers to become employed again, and also reduce employers’ willingness to shell out retrenchment benefits.
This is the third time that WP has put forth the idea of unemployment insurance, having included it in its manifesto before 2011’s General Election as well as bringing it up in the Budget debate four years ago.
Ms Lim proposed in 2016 that both employers and employees could put aside a portion of the worker’s pay that would go toward unemployment insurance.
At the Budget debate on Wednesday, the WP MP added that the Government needs to evaluate its approach to workers’ needs along with the changes in the economy.
Ms Teo answered her by saying that Singapore has a low unemployment rate, as opposed to countries that experience high unemployment as a repeated problem.
She said, “Willingness to pay for unemployment insurance is not the same (here) because most people do not expect to need it and they also have other buffers, for example, a working spouse or child.”
Ms Teo said that initiatives such as SkillsFuture and Adapt and Grow have been provided to help workers attain new skills for further employment.
The Manpower Minister added, “This approach has the full support of unions and employers, which other countries find harder to do.”
Ms Lim answered that some older workers who have taken advantage of these initiatives still find it hard to get employed after some time, according to on the ground feedback.
She asked, “How confident is the Government, moving forward, that you will be able to handle and find solutions for everyone who applied under those schemes?”
The Manpower Minister cited a report from January that showed that Singaporeans’ employment outcomes have been positive over the last 10 years.
She added, “We don’t take the improved employment outcomes of our citizens for granted. It is not a given. We have to work very hard for it.”
But she also admitted there would be some who would have a hard time finding work. “Will there be individuals who still find difficulty? I acknowledge there will always be.”
Ms Teo added that a big hurdle for people to overcome, even later than the lack of financial resources to avail of reskilling training, is the sense of unfamiliarity workers feel in trying out new employment paths, but added that the Government would continue its efforts toward job creation and reskilling. —/TISG