Friday, October 22, 2010

Singapore on fire

If you think, based on the title, that I am going to write about haze, you are wrong.  I am referring to the mess some of the industries are, especially those the Government hopes to foster. These are the current industries or perhaps employment in a drama and on fire:
- Financial consultancy
- Property agency
- Private education
- Wellness clinic

The industries are pretty much those that fits into the Government drive for more SMEs. However, typical of people falling into complacency, laziness or perhaps simply ignorance or even worse, gambling mood, there has been a kind of stand where these steps are repeated:
- Sudden emergence of a business

- Noone cares as it looks like providing a good amount of SME
- Noone cares so lack to no regulations are set up
- Booming time, plenty of jobs - some of it goes to the so called immigrants because locals do not want to do it (for example those in wellness clinic)
- Crashing time, plenty of problems

Let's break it down one by one.

Financial businesses are very lucrative. After all, Singapore drives itself hard to be the leading financial hub. What comes with it is the financial consultant, people who are supposedly working hard to help commoners to plan for their finance. However, as the business rules go, profit is the main driver. So the client's interest go to the back, money making comes to the front. So far, does not seem that there is any regulation to put bad financial consultant to task (or even the agency) if they cause a big loss to the client, misrepresent product or even for hard selling. Unless of course, the client is so rich that they can hire lawyer and push it to court! Plenty of insurance product sold under investment linked features add up to the woe because let's face it, we all want to get more for less. So what happen? Plenty of people become one of such consultants, plenty of people including ah pek and ah mah who got burned. Let's recall Lehman brothers. What happen after that? Nothing, practically nothing that would really change the life of the ah pek and ah mah. I bet those financial industries remain banking on people with sweet lips and nothing is in place to ensure their agents know the products upside down and have system to check or audit for things like honesty. Is it so costly to set up 'mystery shopping' kind of thing for a check and balance system? Nothing comes from the Government so far. After all, the drive is for financial hub, profit, profit, profit. They will at most tell you, if you don't want to get burned, don't go in. Again, my fault. Indeed, so every single one of us has to take care of ourselves better. Know what you are going into and oh yeah, make sure everyone in your family is super smart and don't get conned unless you are rich and can get a lawyer to get your money back. *sarcasm intended* ( I simply wish for a better regulations and to make sure those people are responsible for their jobs. I am sure if I am one such consultant, I will not make too much sales per people but I am sure those clients will love me as I will never cheat them. But then again, I prefer honesty. :-) )  

Property agent is another issue. Lots of moonlighting meaning, potential lack of commitment. Plenty of cases to use for example where there is allegation that the agent won't help the client to save or earn few more thousands. Hey, wake up. What will make the agent help you with few thousands since it only translates to few more tens of dollars. Remember, you are paying 1%. Worse, if you are buyer, you are hoping to lower the price so you are hoping to cut the agent's fee? Dream on! What I would probably do next time I buy a house is to say to the agent that I will give him 20-30% of the savings should he succeed in reducing the cost. I hope no one kills me for disturbing the status quo in the industry. Then again, plenty of bad apples in the industry. Plenty of people who see their interest not represented. Even a case where the agent get a client, the client's tenant (for rental that is) not paying and got evicted within 2 months, the agent still pockets the money and small claim tribunal action has to be started. Gee..... where is the honesty? What's the rules anyway? Huh? Got rules meh? Again, where is the governing regulation or even framework for the industry?

Private education is one of the newest problem. Plenty of schools, into thousands. Yes, you read it right, thousands. Small ones of course. SME, remember? Small enterprises. Seems to be so easy to start one. Plenty of people from overseas coming in for education. Hey, the drive is to be another education hub. Heck care of the start. No strict regulations. Just register with Ministry of Education, get a CASE (Consumer Association of Singapore) and then run your business. My biggest question is why even with the involvement of Ministry level people and a consumer association, a so called accredited and approved institutes can still fold up so easily? What is in the so called requirement to get approval anyway? Simply has money to invest? Gosh... does anyone even start to sit down and think how many foreign students and poor hard working souls (especially those who really want education but got ignored by the other institutes) will be stranded? How many of the foreigners end up being exploited and becomes overstayer? There is even a news of a student who after schooling for a year, haven't obtained student visa. What's he staying with anyway? A work permit? Or simply an overstayer? Now, what does this seemingly mess produce? Some (or plenty perhaps) super rich and a dent in the image. Only after some folds up suddenly there is so called stricter requirements for registration. Gee.. why does it need to have some casualties before action?

Wellness clinic is also another SME growth in the latest years. Plenty of gullible people who thought they can save money by buying a year worth of service only to find out that their money flies away and no service can be obtained since the clinic folds up. Why would you buy the package anyway? Is the risk so low? Who will even guarantee your money should the clinic folds up? CASE will never care even after providing so called accreditation. What is the requirement anyway? Is it a good list of requirement if so many can fold up after the consumer's money run away? Who benefits? Well, again some (or plenty perhaps) super rich. Lots of unemployed immigrants (since their jobs are not interesting for Singaporeans) and clients with money in the black hole. Some of the immigrants surely will contribute to the social ill at the end of the day. Perhaps simply the case of the honest people being pushed to the corner. And yeah, no new regulations yet.

I question the roles of CASE and will they ever do better in protecting the consumer? Perhaps one of the possibility is to start a more powerful consumer association manned by people who can better predict and come up with better accreditation system and who can be hold responsible in a way if there a mess despite their so called accreditation system.

The bottomline is that there should be a simply risk assessment. The Government agency who is the stakeholders in any emerging business should sit together and carry out a risk assessment. They need to assess the positive and negative risk and think about what framework and regulations are required to safeguard the population. What I am looking at now is a Government who is so reactive that I wonder what they are doing in the office day by day. Is that so difficult to wish for proactive civil servants? They are not exactly paid low, supposedly at better than market to get the best. Too much to ask similar thing from the Government to make sure sufficient regulations are in place before victims show up? Is that so difficult to do a risk assessment? The workplace safety and health council just release a code of practice on risk management. I am confident that the code of practice can be easily used for non safety issues, provided they want some changes to better governance.

Saturday, October 9, 2010

Risk assessment in Singapore

Today's newspaper reported the incident of silts from building site leaking into two rivers feeding drinking water system in Singapore. While there does not seem to be a clear indication of preventive action, there is also no clear indication that the builder will even be punished.

What I come to realize in Singapore is how risk assessment has become an empty catch word. Workplace Safety and Health Act (WSHA) requires companies to do so, but there is no enforcement scheme. I never know of any requirement for environmental assessment before construction as well. All these, I suspect, are in the name of progress. After all, doing proper risk assessment require some initial investment (read: COST) which burdens the company. Worse, even saying that risk assessment will prevent further cost, the FUTURE COST is not something easily tangible and seen at present. Hence, things are easily ignored.

The case on silt which is reported is a highly probable sign that little to no environment assessment via risk assessment was carried out before construction. If they have carried out the assessment, most likely they would have realized that Singapore tends to rain all year long and the location of their site is near river feeding to drinking water system. Hence, there shall be a need to ensure no run off of building materials or waste into the rivers. Sadly, no such thoughts seem to exist. In addition, for PUB, nothing seems to have gone wrong. 

It is also a sad practice that risk assessment becomes a task for a single person sitting down in the office. How would that person be able to cover issues from multi disciplinary field? Or is it simply for convenience sake when things go wrong? After all, it is easier to blame one than a group of people?

From what I can see, Singapore's risk management system is far than working. Unless remedial action in improving the safety culture and enforcement, I am afraid that we are waiting for big ugly event to occur. Hopefully it won't be as bad as the red sludge in Hungary.

Friday, October 8, 2010

Minimum wages for maid in Singapore

Now, there has been some argument that there should be a minimum wage for maid in Singapore. This is mainly triggered by Philippines' Government who wants USD 400 (~SGD 525) as a minimum wage for their citizens who work as maid.

I want to examine the case objectively. Since maid or housekeeper is a profession, it needs to be compared with other profession of similar nature. In Singapore, I would argue that cleaner in the coffee shop should have a job similar in nature to maid, i.e. keeping things clean. After all, Ministry of Manpower in Singapore theoretically says a maid should be asked to do only one job scope, i.e. if the maid is to keep house clean, he/she cannot be asked to take care of your kids.

I understand the cleaner in coffee shop is normally paid SGD 600. Considering that they are paid for 8 hours work while maid normally work up to 16 hours, the equivalent wage would be SGD 1,200.

Currently a maid from Philippines in general is paid SGD 350 a month. However, that would have included accommodation, meal and other expenses. If I put in monetary value into those:
- Accommodation of one room without air conditioning and relatively poor condition (admit it, only very few employer give their maid an accommodation fit to be paid normal rental): SGD 300
- Meals, assuming SGD 3.00 a meal and 2 meals and 1 breakfast (SGD 1.00): SGD 7.00/day or SGD 210/month; say if you give fruits and others stuffs, maybe I will round it to SGD 230
- Toiletries and other expenses: assume SGD 30/month
- Travel expense: assume SGD 40/month

The total expense for a maid excluding wage is then SGD 600. If I would to include wage, in total it will become SGD 950. However, there is still levy to pay, that is around SGD 170 (with concession). That means, an employer's effective cost is SGD 1120. That is not that much different from what will be earned by a coffee shop cleaner. In fact some coffee shop cleaner may be even paid less. In fact, if the employer does not receive concession, there will be around SGD 80 extra for levy, making the cost the same.

If the minimum wage for maid is upped to SGD 525. It constitutes a SGD 175 increase. Using the same argument of cost, it would mean that a maid will earn more than a coffee shop cleaner. Hence, I would urge the Government of Singapore to also implement a minimum wage for coffee shop cleaner and other similar profession similar to a maid. There should be equality, right?