Speech by Dr Ng Eng Hen, 2nd Minister for Defence, at Committee of Supply Debate 2008 29 Feb 2008 SAF Career Sir, let me thank Dr Ong Chit Chung, Mr Arthur Fong and Mr Ang Mong Seng for asking how MINDEF or SAF continues to attract good people into the SAF. I am indeed gratified by the question because it shows that they and others like them recognise that it will always be the quality of its people that will determine whether the SAF can fulfil its mission to defend our nation. We will always need to maximise our limited human resources and leverage on better systems to be an effective deterrent. We will need to be smarter in the use of technology to be more efficient so that every defence dollar is stretched to the limit. But above all, in that moment of reckoning, it will be our soldiers and people, their passion, resolve and commitment that will ultimately determine if we can protect and preserve what we have built and hold precious. MINDEF is committed to offer compelling careers to attract the right sort of people to join and stay with us. Dr Ong pointed out that the labour market has indeed tightened and opportunities have increased. MINDEF recognises that it must compete, with other organisations, to attract people with the requisite attributes and aptitude. As part of our value proposition, MINDEF offers exciting careers which encompass extensive opportunities for development and growth as well as competitive remuneration packages. We have the SAVER Scheme for regular Officers and the Premium Plan for regular Warrant Officers and Specialists, or WOSpecs in short. While these schemes have served us well, we have recently embarked on a strategic review to take into account new market realities as well as the operational demands of a 3rd Generation SAF. The operational demands of the 3rd Generation SAF require that we attract and groom people who can leverage on technology, operate sophisticated systems and adapt rapidly. Arising from our strategic review to recruit and retain the right type of people, MINDEF has recently made several refinements to strengthen our career proposition. But before I go into specifics, it is important to put into proper perspective the role of incentive structures. We will always seek to attract those who have the right values, motivations and capabilities to lead and serve in the SAF. And I certainly hope that, for many, it is more than a vocation and it is a calling. But MINDEF also recognises that good people will be attracted to a progressive organisation that values its employees and helps them in their development. Remuneration is important, but employees also want to be developed to their full potential to be able to give their best to the organisation. This basically is the philosophy underpinning our incentive schemes. Some Members may not be familiar with the present schemes. To familiarise Members, let me first talk about the SAVER scheme for officers and then the recent enhancements introduced. The SAVER scheme, first and foremost, helps the SAF to attract capable leaders that keep the SAF dynamic and forward-looking to deal with the wide spectrum of scenarios and corresponding threats. A career in the SAF is physically demanding and this is why we retire our officers young, as some Members have pointed out, at about age 45. This age allows for a career length that is enough for our officers to be developed professionally and to make significant contributions to the SAF before they embark on their next career. To help in the transition, the scheme provides an attractive package which includes a substantial lump sum when they retire. As a result, their earnings from a career with the SAF up till the age of 45, compares well with the typical earnings from a full career in the private sector. Our experience has shown that most are able to transit successfully to their second careers, with more than 75% finding jobs within three months of leaving, and 85% after six months of leaving the SAF. We have made a number of enhancements to the SAVER scheme. First, we have extended career lengths by up to three years, as proposed by Dr Ong Chit Chung and Mr Ang Mong Seng. With extensions, Colonels will leave service at 47 years of age, while Majors and Lieutenant-Colonels leave service at age 45. But let me say that the extension was necessary for operational reasons because it catered to new demands for more foundational and integrated training in a 3rd Generation SAF. Even after the extension, officers will leave with the necessary experience and expertise and young enough to embark on their second careers. The total remuneration package will put them in a strong financial position when they leave the SAF. Second, we will put in additional mid-term retention bonuses. Officers tend to review their career options when they approach their early 30s. To encourage officers to complete a full career with us, we will increase the incentive amounts for those who stay till the end of the first 10 years. Officers also have the option of making withdrawals in advance. Third, wage structures will be adjusted to be more responsive to market conditions. We have added a new Variable Market Bonus for officers, and this is pegged to GDP growth. It will be paid out over two tranches in years of good economic growth. The first tranche will be paid in October of that year, based on GDP growth projections announced by the Government in the third quarter of that year. The second tranche will be paid the following April, after the actual GDP growth for that year has been determined. This mode of payment in two tranches enables us to respond more swiftly to wage movements. Fourth, we recently introduced part-time degree sponsorships for non-graduate officers to upgrade themselves. This is in addition to the many existing schemes for our officers to further their academic qualifications and professional development. Over the years, many officers have benefited from these opportunities. Let me just cite one example. LTC Li Lit Siew, Commanding Officer of 191 Squadron in the Navy, is a naval officer with more than 20 years of service. He has been Honourary Aide-de-Camp to the President and has commanded a Task Group for peace support in Iraq. LTC Li was first sponsored for a local degree programme at NTU two years into service, and later for postgraduate studies at the US Naval Postgraduate School in 1999. Like LTC Li, many officers have received similar opportunities to realise their academic aspirations and have a fulfilling career in the SAF. Let me now talk about the WOSpecs scheme. There is a wider range of operational and technical jobs where longer experience and service is necessary. Hence, WOSpecs serve till the age of 55 because they possess specialised skills and play key roles in training the current and also the next generation of soldiers. To bring in good people into the WOSpec Corps, we increased the recruitment incentives for the various induction schemes. The wages of our WOSpecs are also regularly reviewed to ensure that they remain competitive. In line with market movements, we raised starting salaries and paid a market adjustment component last year to improve recruitment and retention. We will also be paying out a market adjustment component this year. We have introduced new measures as well to meet the academic aspirations of our WOSpecs. To attract good diploma holders to join the WOSpec Corps, we have introduced degree sponsorships for WOSpecs. This is in addition to the current opportunities for upgrading to ITE, Diploma and Advanced Diploma qualifications. One of those who have benefited from such upgrading opportunities is 2WO Koh Ping Wah, Senior Medic in HQ Guards. In the 13 years he has spent in the SAF, 2WO Koh has served in progressively senior appointments, taking part in peacekeeping operations in Timor Leste as well as the humanitarian relief operations in post-Tsunami Aceh. 2WO Koh has a strong passion for nursing, which explains his specialisation as a combat medic. Come this April, he will further his passion for pursuing a full-time Advanced Diploma in Nursing, sponsored by the SAF. He is an example of how the SAF has enabled our regulars to realise their aspirations to upgrade their educational qualifications while providing a fulfilling career. MINDEF will regularly review our schemes to ensure that the SAF continues to offer compelling careers. Dr Ong asked if investment returns from the SAVER scheme could be improved. Let me first clarify that Dr Ong is referring actually to the SAVER-Premium Fund which is applicable to both officers and WOSpecs respectively. This Fund is not from the salary of our officers and WOSpecs but drawn from additional contributions which MINDEF provides so as to enhance the total lump sum when they leave. Accordingly, the Fund is invested to achieve steady returns over the long term. We have in place an investment committee made up of experienced and qualified financial professionals who provide oversight and guidance of investments in a diversified portfolio of stocks and bonds. As with other investment funds, there would be short periods of volatility in return. Officers and WOSpecs can choose their investment plans based on their risk appetites. Our advice to them has been to recognise that this fund is for their longer term retirement and not for speculative purposes. Camp Security Ms Indranee Rajah asked for an update on the incident involving CPL Dave Teo. Sir, as the criminal case against CPL Teo is still pending, Ms Indranee Rajah and other Members of this House would understand why it would be inappropriate to comment on the ongoing case.