Speech by Mrs Josephine Teo, Senior Minister of State for Finance and Transport, at the PEP-SBF Award Ceremony

Date: 07 November 2014
Venue: Amara Hotel
Speaker: Mrs Josephine Teo
 
Mr Peter Ong, Chairman of PEP and Head of Civil Service

Mr Lawrence Leow, Honorary Treasurer of SBF and Chairman of SBF SME Committee

Colleagues and Friends

1. Thank you for inviting me to the PEP-SBF Awards Presentation Ceremony. I’m delighted to be here. Today’s event is a collaboration between SBF and PEP, to recognise public and private efforts to improve Singapore’s pro-enterprise environment. This is the second^[1] time that the PEP-SBF Awards Ceremony is being held.

The role of PEP

2. Some of you know that I spent considerable time in the National Trade Union Congress (NTUC). In the labour movement, we always thought about how it is possible to be pro-workers in a pro-business way. NTUC still thinks this way.

3. In the same way, among the government agencies, we think if it is necessary for the Government to regulate, we should do so in a pro-business way. We want to enable compliance in ways that are sensitive to what businesses experience in terms of costs and constraints. We want to ease the compliance burden whenever possible.

4. To do so, the Government seeks regular feedback from the business community to ensure that our rules and regulations support a competitive business environment. This is an effort that never stops. Each time we think we have fixed some areas, there will always be new challenges, constraints and compliance issues that businesses would like us to look at.

5. One way in which we continuously review our rules and regulations to ensure that they are not burdensome to businesses or stifling business innovation, is through a platform like the Pro-Enterprise Panel, which is a private-public panel that serves as a bridge between the Government and the business community. To signal the importance that the Government places in the work of such a panel, we put the Head of the Civil Service as its Chairman.

6. Today, we recognise the efforts of both the private and public sectors in building an environment conducive to businesses. This includes the business community which has provided useful feedback and suggestions, and government agencies that have acted on these suggestions and made improvements in their regulations.

International recognition of Singapore as the world’s most business-friendly economy

7. These collaborative efforts have played a part to help Singapore maintain its first place in the World Bank’s Doing Business Survey for the ninth consecutive year. This is quite an achievement. We have done well overall and we do not intend to rest on our laurels.

Pro-Enterprise Ranking Survey (PERS)

8. At the same time that these rankings provide us with useful information, it is equally important for us to also know our businesses’ perspectives on how pro-business our government agencies are. In other words, the rankings are useful but we really have to hear from our own business community, how they are interacting with these rules and regulations, how they perceive them and how they are responding to them.

9. This is why every year, we conduct our own annual Pro-Enterprise Ranking Survey, where we ask our corporate customers to rate how “pro-business” our 26 regulatory government agencies are in areas such as customer responsiveness. We want to hear from you.

10. I’m happy to note that the Government has improved from 2012. The Pro-Enterprise Index – which is the overall measure of how business-friendly our government agencies are – increased by about 3 percentage points from 71.7 in 2012 to 74.2 in 2014. Agencies have also made significant improvements in areas of customer responsiveness, and administering regulations.

Smarter Regulations, Competitive Businesses

11. Just as globalisation and technological progress will continue to change the way we live, work and play, our regulations must also adapt to the current environment to ensure that we do not inadvertently, through regulations, stifle business.

12. The Government is committed to doing its part by making our regulatory environment facilitative through ‘Smart rules and regulations’. You may ask, what do we mean when we talk about “smart rules and smart regulations”?

13. First, Smart Regulations are not just about being efficient in responding to business needs. It is about regulations that are focused on the right outcomes. In other words, regulate if we must, but do so in such a way that produces the right effect and with the least unintended consequences.

14. Second, Smart Regulations should be efficient and forward-looking in their design and enforcement. Regulations should not be too difficult to enforce or adjust even when circumstances change.

15. One example of agencies’ efforts to improve their regulatory work is the land registration system of the Singapore Land Authority (SLA), which is receiving the Most Improved Agency award today.

16. SLA introduced the Electronic Property Titles as part of its ongoing efforts to progress towards a fully paperless electronic land registration system. When this example was brought to my attention, I was curious about its significance and impact.

17. The land register shows who owns the land and whether there are encumbrances, such as mortgages or changes affecting the land. Without a land registration system, essentially you don’t really know whether the person you are dealing with owns the land. In other words, property transactions cannot easily take place.

18. In any given year, SLA may handle some 40,000 transactions. Some of these relate to new land titles, or titles changing hands, while others relate to replacement of titles that have been lost. The land titles were in paper form. Most of the time, these titles are not held by the landlords but are held by custodians of the properties, such as the financing institutions that are financing the land or property asset purchase.

19. The key problem faced by financing institutions is storage and as custodians, they must make sure that these titles are not lost. SLA did a check with the financing institutions. They estimated that just the storage costs alone for the land titles come up to about $2 million every year. Not a small amount of money.

20. So, the SLA thought about how it could improve the land titles registration system and whether we can go paperless. The advantage of a paperless system is that it allows for the banks and law firms to do away with the need to physically store the documents and also prevent loss resulting from the handling of the physical documents. It also allows for transactions to take place more quickly due to the convenience of electronic documents.

21. My next question to the SLA was then, since this was a useful system and it was not tremendously difficult to do, why didn't SLA do this earlier? We are also not the first country to do it – the UK and some states in Australia have already implemented similar systems.

22. Here is an interesting illustration of why collaboration with the business community is important. It is not about what SLA wants to do. It is also whether the business community it interacts with is comfortable with the change and is prepared to work with SLA for these changes to be implemented.

23. That is one of the many examples where agencies interact with the business community not only to listen but also to identify opportunities for improvement and persuade them to work in partnership. It cannot be just the agencies doing what they think is right; we also need the business community to be ready and willing to go along.

Conclusion

24. In conclusion, businesses play a critical and important role in helping the Government develop Smart Regulations. I encourage our business community to continue to provide timely feedback and suggestions and for agencies to keep channels open.

25. Once again, I want to commend all the agencies that have put in extra efforts to reach out and listen to the business community, and examine how you work within the agencies to further improve our pro-business environment. Congratulations to all the winners once again.

Thank you.

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^[1] PEP collaborated with SBF to hold the inaugural PEP-SBF Awards Ceremony in 2012. PEP held the first PEP award ceremony on its own in 2011.