Minister Lim Hng Kiang's written reply to Parliament Question on Effects of Productivity Policies on SMEs

Question

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Ms Tan Su Shan: To ask the Minister for Trade and Industry what more can the Ministry do to mitigate unexpected side effects of the Government's productivity policies potentially becoming stumbling blocks for SMEs and the development of local entrepreneurs.

Written reply by Mr Lim Hng Kiang, Minister for Trade and Industry

To remain competitive in the new global economy, Singapore businesses need to transform and move up the value-chain, towards productivity-driven growth. Businesses, including SMEs, understand this, and many are taking steps to improve their productivity. The Government is actively supporting our SMEs in this effort.

We have introduced a range of grants and schemes to help companies upgrade. The National Productivity and Continuing Education Council (NPCEC) has launched productivity roadmaps for 16 sectors, and as of June this year, 13,000 companies have received assistance under these roadmaps. At Budget this year, the government further enhanced schemes to help SMEs improve productivity, attract local manpower, develop capabilities and tap innovation to achieve quality growth. We have also expanded the Enterprise Development Centres (EDCs) into full-fledged SME Centres which offer comprehensive advisory services to SMEs, and added five satellite SME Centres at the Community Development Councils. These centres reach out to SMEs to explain and promote government help to raise their productivity. In addition, the Government has set up three productivity centres to provide customised advice and assistance to SMEs. These are the Singapore Innovation and Productivity Institute for manufacturing, the Construction Productivity Centre for construction, and the Singapore Productivity Centre for retail and food services.

Indicators of entrepreneurial activity have remained healthy, with about 38,500 active start-ups as of 2012, up from 37,500 active start-ups in 2010. Nevertheless, the Entrepreneurship Review Committee is reviewing the entrepreneurship environment, and will make its recommendations early next year.

We are closely monitoring the status of our SMEs and their productivity progress. The SME Workgroup brings together grassroots Advisors, business leaders, and government agencies in a coordinated effort to address SME concerns. The Workgroup has started to engage SMEs to promote greater awareness of Governmental schemes and obtain feedback on how Government assistance to SMEs can be enhanced.