Companies can get extra S Pass, work permit quota if they meet criteria on ‘economic priorities’, local workers

GOLDBELL Group hopes to supplement its workforce with more foreign labour, under the newly-launched Manpower for Strategic Economic Priorities (M-SEP) scheme. The vehicle and equipment leasing company aims to do this even while boosting productivity to make up for scarce manpower.

First announced in March, the scheme opened for applications at 4 pm on Tuesday (Dec 13), on the website of the Ministry of Manpower (MOM). It provides higher foreign worker quotas for “needle-movers” that contribute to Singapore’s economic priorities through ambitious investment, innovation, or internationalisation activities.

Productivity improvements such as upskilling and automation are still the main solution to labour shortages, especially for blue-collar workers – but this takes time, said Goldbell Group chief executive officer Arthur Chua.

About 70 per cent of Goldbell’s 1,000-strong workforce – across brands such as electric car-sharing service BlueSG and intelligent warehousing solution XSquare Technologies – are Singaporeans and permanent residents. With the M-SEP scheme, Goldbell hopes to supplement its after-sales workforce with foreign hires.

Under the scheme, eligible companies can temporarily hire S Pass and work permit holders above the prevailing dependency ratio ceiling (DRC) and S Pass sub-DRC, at up to 5 per cent above their base workforce headcount. This is subject to a cap of 50 workers per firm.

Successful applicants are granted these additional quotas for an initial two years, after which they may apply for renewal. When first announced, the scheme was said to be available for three years.

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The scheme comes as S Pass DRCs are being cut next year for the manufacturing, construction, marine shipyard and process sectors, to 15 per cent from 18 per cent currently.

At the official M-SEP launch on Tuesday, Manpower Minister Tan See Leng said the move is in tandem with the upcoming quota reduction: “We wanted to provide enterprises that are very innovative, that have made significant investments and that have also very firm and very aggressive internationalisation plans, the complementary foreign manpower to help them.”

When asked, the Ministry of Trade and Industry (MTI) and MOM said that the scheme is not meant for specific sectors or industries. To be eligible, firms must participate in qualifying initiatives by one of five agencies, or meet certain economic criteria such as being a manufacturer employing at least 500 locals.

Qualifying programmes include the Economic Development Board’s Development and Expansion Incentive, Enterprise Singapore’s Scale-Up SG and the Singapore Tourism Board’s Business Improvement Fund. The other two agencies are the Infocomm Media Development Authority and the Maritime & Port Authority of Singapore.

Companies must also commit to employing more locals, and/or to training them under approved programmes to enhance their jobs. They will receive one additional headcount per local that they commit to hire or upskill. Alternatively, they can be an “industry leader” that has been recognised for training excellence.

The first condition for participation or economic criteria is “selective”, said MTI and MOM. Only about 1,000 firms meet this requirement, less than 1 per cent of all registered business entities here, “but not all of them will require additional S Pass and work permit quotas”. They added: “Even among those with the need, not all of them can access the maximum flexibility.”

For the second condition, depending on the commitments made, companies’ performance will be tracked either via MOM’s system or through submitted supporting documents, to be assessed by the relevant agencies.

“Failure to meet commitments by the end of the M-SEP support period will result in the suspension of eligibility for M-SEP renewal for two years,” said the ministries.

Aslam Sardar, chief executive officer of the Institute for Human Resource Professionals, said that companies today face “the twin challenge” of ensuring smooth day-to-day operations while looking at business transformation. The extra manpower provided by the scheme will allow companies to free up local workers, he said. “Not only does this value-add and develop local workers, but it also contributes to business and workforce transformation.”

Albert Tsui, executive director of the advocacy and policy division of the Singapore Business Federation, said that the “new channel of manpower would be welcomed by businesses, especially those that require workers with niche skills but are in short supply”.

But he noted that it “remains a time-bound initiative which will not address enduring manpower challenges faced by businesses”.

Similarly, Container Printers CEO Amy Chung was encouraged by the higher quota but worried that the limited time frame would result in a loss of trained and skilled workers. Her firm, a Scale-up SG participant, provides metal and flexible packaging solutions for nutritional and healthcare products.

Both local and foreign workers receive training, and full training can take almost three years, said Chung. Limiting how long foreign workers can stay would mean that “all (the) training efforts are wasted”.

Association of Small and Medium Enterprises vice-president Ang Yuit said the scheme is a good step for larger companies, but its targeted approach means that smaller enterprises are unlikely to benefit.

For SMEs, there are “two hoops to jump (through)”, he noted: first, getting into one of the qualifying programmes or achieving one of the qualifying activities, then qualifying for M-SEP.

“We could consider whether the criteria will be broadened, to allow for more businesses (that further) strategic economic priorities to get manpower,” he said.