Opening Remarks by MOS Tan Kiat How at the BuildSG LEAD Summit

May 6, 2022

Good morning, and a warm welcome to the BuildSG LEAD Summit.

I would have liked to meet all of you in person. Unfortunately, I am away on an official trip. I am glad to still be able to share some of my thoughts with you today.  

The LEAD Summit is an important platform. It brings leaders like you together to encourage the sharing of best practices and learning amongst the community. This year’s theme of “Building Towards an Innovative Economy: BE Ahead” is a play of words. It sets out our ambition for the sector to be ahead.

Emerging from COVID

Even as we look ahead, I would like to first acknowledge the challenges that we have faced in the last couple of years. When COVID-19 first broke out, almost all construction works grinded to a halt. Even after the Circuit Breaker, resumption of activities was gradual. With border restrictions and lockdowns around the world, firms grappled with manpower shortages and supply disruptions. Projects were delayed and firms had to cope with tight cash flows, often digging into their reserves.

I thank all of you for your support and cooperation in overcoming these difficulties together. We are not yet out of the woods, but we are in a much better position. The public health situation has improved. Border measures have eased, allowing worker inflows to resume.

We are closely monitoring the impact on our sector arising from the Ukraine-Russia conflict, but we are seeing encouraging signs of recovery. Construction output across the industry has almost reached pre-COVID levels.

Lessons Learned from COVID-19

While we have turned a corner, let us not forget the lessons learnt. I would like to offer two takeaways.

First, COVID-19 has shown how the various parts in our BE ecosystem are closely intertwined. Whether you are a developer, a consultant, a builder, a specialist trade, a facility manager or even a regulator, we are all in the same boat, and a leak in one area will affect everyone on board.

We got through this crisis, not by pointing fingers and assigning blame, but by coming together, rolling up our sleeves to solve common challenges for mutual benefit. For instance, when travel restrictions were imposed, many developers stepped up to share increased manpower and project prolongation costs with their contractors. QPs also put in extra effort to adapt to the evolving situation, helping to revise technical drawings and designs. The Government also played our part by supporting the sector through measures like the $1.36 billion Construction Support Package, foreign worker levy waivers and rebates and the COVID-19 (Temporary Measures) Act. There are many more examples of how one party leaned forward to help another.

I hope that we keep this spirit of working together. Let us build on this foundation – continue to break down silos and find ways of working together for greater impact. COVID-19 is just one crisis, and there are many more hills to climb as we transform the sector.

This brings me to my second point on resilience. When COVID-19 struck, the industry was able to leverage past investments in productivity measures. These partially mitigated disruptions – consultants and contractors were able to shift part of their work online because of digital platforms and tools; some on-site works could continue with SMMs, thanks to the adoption of automation and pre-fabrication.

However, more needs to be done. We need to accelerate efforts towards less manpower-intensive work processes to reduce our reliance on manual labour. We need to effectively use technology to overcome traditional constraints and build deeper capabilities. This way, we can retain our competitiveness and better prepare for the next crisis, which is a matter of when and not if. In fact, one of the participants of the LEAD Horizon Programme I spoke to recently said that “innovation is not risky, not innovating is riskier”.

To guide our effort, we are refreshing our transformation plan under the Future Economy Council (FEC) Urban Systems (US) Cluster Sub-Committee. This sub-committee is co-chaired by Mr Liam Wee Sin from UOL Group Limited and me. Over the past year, we have been engaging stakeholders across the sector. We are putting the plan together and will share more details of the Construction Industry Transformation Map (ITM) 2025 later this year.

Rebranding Jobs in the BE sector

But let me just touch on one important feedback received. Almost all stakeholders shared with us that there is a pressing need to rebrand the industry to attract and retain Singaporeans. Some have even framed this issue as an existential one for their profession. For example, they shared with me that their younger staff want better working conditions, more developmental opportunities, exciting projects to challenge them and see meaning in what they do. I think these are reasonable aspirations. We wanted the same for ourselves when we were in that stage of life, and we want the next generation to do better than our generation.  

So, this means that as a sector, we must rise to the challenge of meeting these aspirations through industry transformation and job redesign. This is the enduring way of changing the perception of BE sector jobs.

Role of Leaders

We already know what needs to be done on the technical front – enhance automation, embrace digitalisation and engineer for sustainability. But the more difficult part is the “softer” side. For us to succeed in our transformation efforts, we need to build trust and develop the right culture. Leaders and leadership would be pivotal in this regard.   

I am heartened that many of you are stepping up. Several BE firms have recently been acknowledged for their good HR practices. For instance, Kimly Construction received the SkillsFuture Employer Award for their commitment to lifelong learning and skills development for their staff. Firms like CapitaLand, CDL, Arup and KTC have also been recognised and featured as Singapore’s top employers by the Straits Times.

Leaders also helped to bring stakeholders together to achieve win-win outcomes and build up a foundation of trust. For example, when COVID-19 travel restrictions limited the inflow of workers, industry leaders came together to put in place an end-to-end process to help bring foreign workers into Singapore safely. Industry-led workgroups also spearheaded solutions for the future. For instance, the Digitalising BE Alliance for Action (AfA) has established the Common Data Environment Data Standard to facilitate interoperability and information exchange.

If I may suggest, BE leaders can continue to build trust at three levels.

One, with members of the public. We should continue to uphold highest level of professionalism within our sector. I am sure all of us face significant budget and timeline pressures, but we must continue to build safely and not cut corners. This is essential to maintain a high level of public trust so that Singaporeans remain confident in the quality and safety of the buildings we design, build, and maintain.

Two, across members of the BE value chain. The BE ecosystem is highly interdependent. For instance, suppliers facing disruptions or rising material costs will affect contractors’ work and delivery timelines for developers. Stakeholders must come together and work out win-win solutions to achieve collective project outcomes. We can consider how to share risks more equitably across different parts of the BE value chain when drawing up construction contracts. This way, no one part of the sector will be disproportionately affected in future crises. The Government will play our part. Large public sector projects include fluctuation clauses for key materials so that costs can be shared. We encourage the rest of the BE sector to also do so. 

Finally, we can also do more to establish trust between employers and employees within our organisations. People are at the heart of our transformation efforts, and we need to bring them along this journey. Communication and engagement are key to help your staff understand the rationale for the changes and assuage their concerns and anxieties. I had the chance to speak to BE firms that were recognised to be amongst Singapore’s top employers. In addition to communication, they also spoke about staff empowerment so that their employees could drive change and innovation from the ground up. This includes providing developmental opportunities or making new digital tools available. One firm even established inter-departmental committees to champion innovative projects.

In all these aspects – whether it is maintaining public trust in the sector, developing a collaborative relationship between firms within the BE sector or nurturing a progressive, people-centric culture within our organisations, leadership is key. All of you are key.

To conclude, let me commend your efforts thus far in navigating the industry through a very challenging period. We are not fully out of the woods but are in a much stronger position compared to when COVID-19 struck. With your support and leadership, I am confident that we can transform our industry and take the sector to greater heights.

I wish you a fulfilling conference. Thank you.