Speech by SMS Chee Hong Tat at RAS EXSA Ceremony

SPEECH BY MR CHEE HONG TAT, SENIOR MINISTER OF STATE, MINISTRY OF TRADE AND INDUSTRY & MINISTRY OF EDUCATION AT THE RESTAURANT ASSOCIATION OF SINGAPORE (RAS) EXCELLENT SERVICE AWARD (EXSA) CEREMONY ON THURSDAY, 4 OCT 2018, 2.00 PM, at NTUC AUDITORIUM, ONE MARINA BOULEVARD

Mr Vincent Tan, President of the Restaurant Association of Singapore (RAS),

Award Recipients and Industry Representatives,

Ladies and Gentlemen,

Good Afternoon.

1.     I am delighted to join you at this year’s Excellent Service Award (EXSA) ceremony for the food services industry, an annual event organised by RAS.

2.     Let me start by congratulating all EXSA winners on your achievements. Through your outstanding service, you have contributed to the success of our F&B establishments.

3.     In his speech, Vincent touched on the importance of good service in the F&B sector, and providing a positive experience for your customers. I agree with him. This concept also applies to the government when we provide services to citizens and businesses. As regulators, part of our service includes licence applications and approvals.  We need licensing and regulations to protect society against downside risks, and ensure a level-playing field for all stakeholders.  The question we ask ourselves is how can our regulatory framework support a pro-enterprise and pro-innovation environment; one which can give Singapore a competitive advantage in the global economy?  

The Government strives to deliver good service through a pro-enterprise approach

4.     Earlier this year, I said in Parliament that the Pro-Enterprise Panel in MTI is working with stakeholders such as the Association of Catering Professionals Singapore to simplify our licensing regime to reduce compliance costs for businesses in the food services sector. Currently, a F&B company can have up to 14 touchpoints with different government agencies to obtain the necessary licences to set up shop.  We think this is not acceptable, so we set ourselves a challenge to do better. 

5.     We have since formed a team comprising officers from MTI, the Smart Nation and Digital Government Office, GovTech and the Public Service pision to do a deep pe into the regulatory requirements for the food services sector. All our team members agree that it is not adequate to simply build an IT system which overlays existing systems and processes in the agencies. That will only increase cost and processing time for businesses. We must ensure that when we try to achieve ‘one-stop’ service, our ‘one-stop’ should not become ‘one more stop’.    

6.     What we have done is to relook the entire service journey from a company’s perspective: from setting up of the company to receiving the required licence approvals to commence operations.  We analysed which are the steps to streamline and where we can re-engineer the regulatory processes to make licensing better, cheaper and faster.  Better in terms of improved user experience and convenience; cheaper in terms of lower licensing fees to reduce costs for businesses; and faster in terms of quicker processing and turnaround time for the applicants. 

7.     The review is still on-going, but I would like to provide an update on the progress made so far; how these can benefit restaurants and food outlets in Singapore; and what are the next steps we are planning to take.

8.     First, the new application process will be better because companies will find it easier to apply for the required licences and permits. Previously, a company which wants to set up a food shop would need to fill up to 845 data fields across multiple forms administered by different government agencies.  Many of the 845 data fields are duplicative, as different agencies are asking for the same information.

9.     By removing duplication and auto-populating with available information from agencies such as ACRA, we have cut down to 200 data fields so far.  This is a reduction of more than 75%.  I believe we can go even further in some cases where the application is more straightforward, to achieve a further reduction in the next phase of the review. My stretch target for the team is to see if we can go below 100 data fields.  We will try. 

10. In addition, we will consolidate all the 14 forms into one single application to make it more convenient for businesses.  You only have to upload supporting documents once when applying for licences from different agencies, instead of the current arrangement where you have to submit similar documents for each licence application.

11. Second, we want the new application process to be cheaper for businesses.  We will reduce licence fees by removing unnecessary steps in the application process and where possible, changing the way we regulate to strike a good balance between risk management and cost management.  If Government agencies can lower our processing and enforcement costs, we can share the savings with businesses in the form of lower licence fees.    

12. So far, we have managed to reduce the total fees which an applicant has to pay by more than $500.  The savings come mainly from removal of unnecessary steps in the application process.  To be candid, these improvements are useful but they are lower-hanging fruits.  The more difficult next step is to ask every agency to scrutinise their cost structures and look for ways to improve efficiency or change their regulatory approach to reduce licensing costs. 

13. For example, when I was with Energy Market Authority previously, we changed our electrical workers’ licence from annual to lifetime, similar to driving licence.  This removes the need for annual renewal and payment of renewal fees.  At the same time, EMA retains the powers to take action against the small number of licensees who misbehave, including imposing fines and suspending their licences if necessary.  I believe this risk-based and targeted approach allows us to lower the overall fees for the majority of licensees.  It also encourages compliance from the licensees as this translates into lower regulatory costs for them. 

14. The next step in our review will be challenging because the natural reaction from every agency is to try and keep their existing processes intact.  I do not fault the agencies as they are operating within the constraints and incentives of our current system.  This is why I believe rules review can only succeed if it is done with top-down support for ground-up ideas, as part of Public Sector Innovation and Transformation.  I am glad that Head of Civil Service and our senior Public Service leaders are giving their fullest support for these regulatory deep-pes.  And if policy changes are required, we will surface to the Ministers and Cabinet for a decision. 

15. Lastly, the new application process will be faster as we can reduce processing time by 14 days, from the current 42 days to 28 days for standard applications.  This is achieved through a combination of measures such as process simplification and harmonisation, sharing of information between different agencies, and using parallel processing where possible.  The shorter turnaround time will benefit businesses and provide greater certainty when they start up their operations.  We will continue to review if there are ways to further shorten the processing time. 

Partnering with TACs on rules review

16. Ladies and gentlemen, I have talked about how we can improve our licence application process to make it better, cheaper and faster for businesses. This is not a one-off effort, it is an on-going review to achieve continuous improvement over time.  It is also not confined to the food services sector, but represents a broader approach we want to adopt in licensing and regulation. 

17. Importantly, we want to work with our businesses and get your feedback and ideas on how we can further improve, so that smart regulation can be one of our competitive advantages in Singapore.  This is an area where we can do better than most other countries, to support a pro-enterprise and pro-innovation economy. 

18. I am therefore happy to share that for the next phase of our review, we will be partnering RAS to test the system and look for areas where we can further improve, before we open up the system to all users in 2019. The feedback from RAS members will be valuable inputs for us to design our system and review the regulations together.  Besides RAS, we will also be working with other TACs in the F&B industry to get their feedback and suggestions.  When we extend our regulatory reviews to other areas, I hope we can likewise partner with the TACs in these sectors to do the reviews together.   

19. Being pro-business in our regulations goes beyond changing rules. It is encouraging a mind-set shift in all our stakeholders, from public agencies to businesses and society as a whole. 

20. There will be some risk when we embark on regulatory reviews and when we try out new ideas. This is not like buying durians, there is no “bao jiak”.  Some of our pilots could fail and some of the new rules may not work well. But what is important is that we create a societal culture in Singapore where people are willing to venture outside our comfort zones, take calculated risks and be prepared to accept some failures along the way.  If we have zero tolerance for failure, we will not succeed in discovering new pathways and innovating new ideas. 

21. I want to thank our public agencies which have worked with us on this project, for being open-minded and willing to try new ways of doing things.  I also thank RAS and other industry stakeholders for your support to do this pilot with us.  We cannot tell with certainty whether our pilot will succeed, but I know that if we put our hearts and minds in it together, we will be able to overcome the challenges and achieve some improvements for our businesses.  Let us work together and strive towards this goal. 

22. Thank you everyone for your hard work and commitment in bringing the Food Services industry to greater heights. And to the award winners, my sincere congratulations once again on your achievements!

23. I wish all of you a pleasant day ahead.