Speech by MOS Tan Kiat How at the Committee of Supply Debate on 8 March 2022
Mar 8, 2022
1. Madam Chair, I will speak on how we will accelerate our transformation plans for the Built Environment (BE) sector.
Supporting the Built Environment through COVID-19
2. Over the past two years, COVID-19 has posed significant challenges for the Built Environment sector, as shared by Mr Henry Kwek and others before him.
3. The Government has provided substantial support to help the sector tide through this pandemic.
a. This includes the $1.36 billion Construction Support Package, the Jobs Support Scheme, Foreign Worker Levy waivers and rebates, and legislative relief under COTMA.
4. The support has been available to all our construction firms, including sub-contractors.
a. The Government has also recently announced the extension of the Temporary Bridging Loan Programme (TBLP) and the Enterprise Financing Scheme – Project Loan (EFS-PL) to support firms’ cash flow needs.
5. Notwithstanding the support available to contractors, we understand that some Town Councils (TCs) are facing higher tender prices, as raised by Mr Gerald Giam. This issue was also raised by Ms Tin Pei Ling and Ms Ng Ling Ling last year.
6. Mr Giam suggested that HDB temporarily increase its Neighbourhood Renewal Programme (NRP) grants.
a. Upgrading projects such as the NRP remain important to rejuvenate older HDB estates to benefit our residents.
b. As I shared with Ms Tin then, our overall fiscal situation remains tight, and I encourage Town Councils to start by reviewing the scope of their projects and reduce upgrading items if possible.
c. Nonetheless, we are in regular discussions with all Town Councils, and will continue to monitor the situation closely.
7. Mr Giam also suggested that HDB provides materials price protection for contractors of town improvement projects.
a. HDB does provide such price protection for its BTO contractors. This includes offering contractors the option of guaranteed protection against steel price fluctuations, where HDB will pay their contractors if the price of steel exceeds the price that is protected by HDB. Another example is stipulating a fixed quantity of concreting materials that HDB will supply at the point of tender closure.
b. However, the contracts for town improvement projects are between Town Councils and their own contractors and it is up to each Town Council to decide whether to adopt this approach.
c. HDB understands that Town Councils generally do not do so, as their projects are not as complex or as extensive as BTO projects.
8. Mr Giam also suggested that MND explores measures to strengthen confidence within the construction sector and for parties to better manage risk.
9. We have been doing so, and the public sector is taking the lead.
a. Last November, we amended the Public Sector Standard Conditions of Contract (PSSCOC) to reduce the need for our contractors to buffer in additional costs in their tender bids.
b. First, we made clear the grounds for Extension of Time caused by pandemics.
c. Second, we included provisions for parties to co-share equally the relevant cost increases incurred due to pandemics such as labour, plant and equipment, materials or goods and site overheads costs.
d. Third, BCA has also worked with GPEs to provide a provisional sum for anticipated cost items during a pandemic (such as swab tests) in their new tenders. With this, contractors need not price these costs into their tender bids.
e. These practices minimise the need for contractors to buffer significant additional costs in their bids to cater for uncertainty.
10. Mr Henry Kwek asked about the inflow of foreign manpower for the sector. He also asked how the Government can continue to work with our trade associations to support the sector.
11. The Government has worked closely with the industry to facilitate the inflow of migrant workers.
a. Our industry partners, including trade associations like Singapore Contractors Association Limited (SCAL), spearheaded efforts to implement a tightened end-to-end process, to bring in migrant workers in a safe manner.
b. Workers can also enter Singapore via MOM’s Work Pass Holder General Lane.
c. While this arrangement has served the industry well, there is scope to streamline the entry requirements as the COVID-19 situation improves.
12. That is why we have recently announced that the entry requirements for vaccinated new Work Permit holders (WPHs) in the Construction, Marine Shipyard and Process (CMP) sectors will be streamlined with effect from 13 March 2022.
a. The streamlined process will help the CMP sectors accelerate the entry of necessary workers for ongoing projects, alleviate the labour shortage, while building greater resilience in the workforce.
Progress under the Construction Industry Transformation Map
13. At the same time, we must accelerate our push for transformation.
a. We started this journey back in 2017, and worked with stakeholders to put together the Construction Industry Transformation Map (ITM).
b. There are three key outcomes – achieving automation through Design for Manufacturing and Assembly (DfMA), enhancing digitalisation through Integrated Digital Delivery (IDD), and promoting sustainability through Green Buildings.
14. Through DfMA, we are moving construction work off-site into a controlled factory environment, where building modules are prefabricated before assembly on-site, and achieve higher labour productivity and safer work sites.
a. We have been pushing for DfMA adoption in the industry over the years. In 2021, around 44% of building projects by GFA adopted DfMA, and we remain on track to meet our target of 70% by 2025.
15. Mr Chong Kee Hiong spoke about raising the adoption of Prefabricated Prefinished Volumetric Construction (PPVC), which is a form of DfMA. It is well suited to residential and hotel developments.
a. Our PPVC adoption rate is currently about 20% by GFA. The cost premium for PPVC compared to the traditional construction methods has decreased from 10-15% in 2015 to 7-8% in 2019.
b. It has remained at around this level during the pandemic. This is because while labour costs have risen, the cost of imported PPVC materials has also risen.
c. We will continue to encourage PPVC adoption through the Government Land Sales (GLS) programme. For instance, we require PPVC adoption for suitable residential and hotel GLS sites, including HDB Executive Condominium developments.
d. We are also putting in place greater modularisation and standardisation requirements under the Buildability Framework to lower costs.
e. However, PPVC may not be suitable for all developments, especially developments with site constraints, or smaller developments without economies of scale.
f. But let me reassure the Member that we will continue to push for the wider adoption of DfMA, including PPVC, wherever possible.
16. Another focus area is IDD.
a. Through IDD, stakeholders across the building lifecycle from upstream design to downstream facilities management can collaborate more seamlessly through digital platforms. This digitalisation improves the accuracy of design and planning, and reduces abortive work in construction and maintenance.
b. We have raised IDD adoption by GFA from 20% to 34% in the past year alone, and continue to make good progress towards our target of 70% by 2025.
17. And we have greened more than 49% of our buildings by GFA under the Singapore Green Building Masterplan.
Accelerating Transformation of the Built Environment Sector
18. Madam Chair, we have made steady progress, over the years. But we will need to accelerate our transformation efforts in light of the lessons learnt from COVID-19.
19. At the same time, the operating environment for the Built Environment sector is rapidly changing.
20. Against this backdrop, we have begun refreshing our transformation plan under the Future Economy Council (FEC) Urban Systems (US) Cluster Sub-committee.
a. Co-chaired by Mr Liam Wee Sin from UOL Group Limited and myself, we have been engaging stakeholders across the sector – developers, builders, consultants, contractors and facilities managers.
21. We will share more details later this year. However, to kickstart the next bound of transformation, we encourage our BE firms to tap on the various incentive schemes in making the transition.
Construction Productivity and Capability Fund
22. First, we will extend the Productivity Innovation Project (PIP) scheme until March 2024.
a. The PIP has helped many firms, including SMEs, adopt DfMA and IDD technologies that have made construction work more productive.
b. Under the PIP, firms can benefit from support of up to 70% of the costs of adopting solutions like DfMA and IDD.
23. Second, we will extend the iBuildSG Scholarship and Sponsorship scheme until March 2023.
a. This scheme has been very helpful in enabling our Built Environment firms to attract young talents. Since 2010, the scheme supported more than 3,700 Singaporeans with the costs of their studies and pursue careers in the sector.
24. Firms can also continue to apply for the Productivity Solutions Grant (PSG), which co-funds up to 70% of the cost of adopting off-the-shelf digital solutions.
25. Taken together, these CPCF schemes will support firms to transform and build the pipeline of local talent, and be better prepared for the foreign manpower tightening moves that would be implemented in 2024.
Transforming the Facilities Management Industry
26. In addition to transforming the way we build, we need to change the way we maintain our buildings through Facilities Management (FM).
27. By 2025, more than 50% of our buildings will be above 30 years old. Given the twin pressures of ageing buildings and rising manpower costs, we will need to press on with our effort to transform the FM industry.
28. Ms Cheryl Chan asked what steps we will take to accelerate FM transformation.
a. And we agree with Ms Chan that there is a need to do more to encourage the adoption of new technologies. In particular, FM firms can harness efficiencies from managing different FM services on an integrated platform, and aggregating FM services across many different buildings.
b. I recently visited CBRE, a firm that provides FM services to office buildings, industrial spaces, and laboratories. Through its integrated Vantage Analytics platform, CBRE is able to virtually manage its entire portfolio of buildings, for its full suite of FM services including security, cleaning, and energy management. CBRE’s services have helped its clients, including public sector agencies, attain significant cost savings. For instance, CBRE has worked with JTC to achieve up to 15% operational cost savings in the maintenance of its buildings, including Space@Tuas and JTC Chemicals Hub.
29. This is what we call Integrated and Aggregated FM.
30. Both service buyers and providers play key roles in the adoption of advanced technologies as part of Integrated and Aggregated FM.
a. This includes the smart FM technologies that enable predictive maintenance, and investing in the infrastructure for data and analytics as both Ms Tin Pei Ling and Ms Cheryl Chan had pointed out.
b. And we also agree with Ms Chan that service buyers including our Town Councils should look at adopting outcome-based contracts that can facilitate advanced technologies. At the same time, service providers will need to level up their capabilities.
31. That said, adoption of Integrated and Aggregated FM remains nascent, especially for existing buildings given the high retrofitting costs.
32. To encourage building owners and the FM industry to adopt these good practices, we will introduce a new $30 million grant, which will co-fund up to 70% of the initial capital investment and retrofitting costs for Integrated and Aggregated FM.
a. We plan to fund around 10 to 15 projects across different building typologies. This will establish the business case for wider adoption.
b. To qualify for funding support, building owners will need to work with FM firms to install smart infrastructure such as sensors and intelligent building management systems, and rework their procurement practices and processes to integrate at least three FM services, for at least three buildings in their portfolio.
c. The grant will be available for a period of three years from the second half of this year.
d. I seek the strong support of our building owners and FM firms to explore Integrated and Aggregated FM for your operations.
Leveraging Research and Development to Drive Innovation
33. In addition, we will continue to leverage Research and Development (R&D) to push the boundaries for automation, digitalisation, and sustainability through innovation.
34. Since the launch of the Cities of Tomorrow (CoT) programme in 2017, we have supported a wide range of R&D efforts for the Built Environment sector.
a. We will invest a further $46 million to support innovations for advanced construction and facilities management.
b. These innovations include customisable robotic systems for on-site assembly and off-site construction, and building designs that facilitate the use of robotic solutions.
c. We are also investing in next-generation construction techniques and technologies such as 3D concrete printing (3DCP), to complement the adoption of robotics in raising productivity.
Developing our Built Environment Workforce
35. Madam Chair, I have detailed how we will transform the BE sector to be more manpower-lean and resilient. But we will need to complement these efforts with a resolute focus on jobs.
36. Mr Henry Kwek and Mr Cheng Hsing Yao had asked how we would attract more Singaporeans to join this sector.
37. Our ongoing transformation efforts have helped us to create good jobs for locals in the areas of DfMA engineering and digital delivery.
a. I recently met Mr Teh Ming Xuan, a planning engineer working for Kimly Construction whose studies were supported by a joint iBuildSG scholarship between BCA and Kimly. Through an internship with Kimly, Ming Xuan became interested in how construction can be radically transformed via DfMA and IDD. He now provides technical support in these areas, working on the implementation of digital platforms and prefabrication to raise construction productivity. He also contributes to Kimly’s R&D efforts in advanced robotics and automation, and actively explores how new innovations can be deployed for Kimly’s projects.
38. In addition to the iBuildSG Scholarship and Sponsorship scheme, we have put in place a multi-pronged approach to attract and upskill talent.
a. First, we continue to work closely with our Institutes of Higher Learning (IHLs) to engage our students on Built Environment careers through the iBuildSG Club. We are also working with IHLs to incorporate emerging skillsets in DfMA, IDD and Green Buildings into their curriculum. And we will undertake further initiatives to better retain our polytechnic and ITE graduates.
b. We will partner our IHLs to put in place more work-study programmes and provide meaningful internships for our students.
c. Second, we will support our mid-career entrants through putting together more Career Conversion Programmes (CCPs), which provide on-the-job training to help our mid-career entrants pick up new skills more quickly. For instance, we have managed to train 94 individuals as BIM modellers over the past three years.
d. Third, we will continue to work closely with trade associations on accreditation schemes to raise standards within the BE sector, and encourage more firms to adopt the Built Environment Skills Framework.
e. For example, I recently met Boustead Projects, a firm that has actively invested in training its employees to keep pace with industry transformation. Over the years, Boustead has leveraged BIM to deliver quality construction projects, through digital visualisation of building designs, documentation, and cost estimation. This has allowed Boustead to develop its own in-house training programmes to train its employees in these skillsets. In fact, Boustead has curated training programmes in partnership with NTUC Learning Hub, BCA Academy and IHLs as a SkillsFuture Queen Bee, for employees of SMEs across the BE sector.
39. As we embark on the next bound of industry transformation, we will also need to update our existing initiatives.
40. This is why we are embarking on a Jobs Transformation Map (JTM) study for the BE sector.
a. Many of our existing schemes adopt a broad-based approach to workforce development.
b. But there is a need to be more targeted in our approach, and tailor our initiatives to grow in-demand jobs for the next bound of industry transformation.
41. In this regard, the JTM will examine the combined effects of COVID-19 and industry transformation, and chart out targeted interventions for specific roles.
a. We aim to conclude the JTM in the second half of this year, and will work with our IHLs, trade associations and firms to implement the recommendations.
42. Madam Chair, please allow me say a few words in Mandarin.
43. 在过去的两年， 建筑环境业因冠病疫情受到很大的冲击， 面对停工，人力短缺， 供应链中断，建材成本上扬，等等挑战。
44. 政府为了帮助建筑业者度过难关， 提供了各方面的经济援助。
45. 政府的援助， 加上建筑业者的毅力和所做出的调整， 建筑活动已经逐步复苏。
47. 尽管如此，政府仍然会密切关注情况 ，并在必要时采取进一步的措施。
49. 我们必须加快建筑业转型的步伐，推动自动化， 提高生产力，以减少对外籍劳工的依赖。
50. 为此，政府会继续提供援助。 我们将延长建筑生产力与产能基金（Construction Productivity and Capability Fund） 旗下的援助计划。
51. 为了应变气候变化，我们将拨出六千三百万元的补助，为现有的建筑进行改装， 以达到更高的能源使用效率。
54. 只要齐心协力，我们可以打造坚韧， 可持续和宜居的未来城市。
55. Across our collective efforts to transform the Built Environment sector, the Government will take the lead through our public sector projects.
56. We also remain committed to working hand-in-hand with our industry partners on charting the path ahead in the new normal.
57. Together, we can create a future-ready Built Environment and emerge stronger from COVID-19.
58. And now, let me address some other cuts.
a. Mr Gerald Giam had asked about our efforts to manage bird pest issues in housing estates.
i. NParks will continue to work with Town Councils, including Aljunied-Hougang Town Council, to manage the population of pest birds in residential areas through measures such as habitat modification and food source reduction.
ii. NParks is also carrying out research to understand the ecology of birds, including how their reproductive biology and factors such as food availability can affect their population.
iii. And NParks has been sharing best practices with our Town Councils. In fact, on 24 February 2021, and 17 August 2021, NParks briefed all Town Councils on some of the best practices and research findings and had a dedicated session for Aljunied-Hougang Town Council on 18 May 2021.
iv. That said, trapping birds and moving them to another location, as suggested by Mr Giam is not a feasible approach. We will be transferring the problem to another group of residents.
v. A more sustainable approach would be keeping our public and common areas clean and free of food. In this regard, we need the assistance of our Town Councils, and the public.
b. Mr Louis Ng had also raised the issue of cat ownership in HDB flats.
i. As part of our broader efforts to improve standards in the pet sector, we have been engaging stakeholders on a range of issues such as improving dog rehoming and adoption processes, raising standards of pet boarders and breeders.
ii. And we are reviewing, and will continue to review our pet ownership policies to ensure that they balance the needs of different segments of the community, including pet lovers, and those who might have concerns about disamenities that may arise.
iii. We are considering this issue from various angles, including enhancing our strategies for the management of both pet cats and stray cats, to effectively manage the overall population of cats in Singapore.
iv. I would like to assure the Member, Mr Louis Ng, that we will work with stakeholders to study this issue carefully. Thank you.