Speech by MOS Zaqy Mohamad at the Committee of Supply Debate 2020 - Continuing our Efforts to Transform the Built Environment Sector

Wednesday, 4 March 2020

As we continue to remake our city, we must ensure that our firms and our workers in the Built Environment sector keep pace with technological advancements, improve their capabilities and seize upcoming opportunities.

Continuing our Efforts to Transform the Construction Sector

In 2017, we developed the Construction Industry Transformation Map, or ITM, with the industry, unions, and the IHLs. 

We have made good progress in our three ITM transformation areas, namely, Design for Manufacturing and Assembly (DfMA), Integrated Digital Delivery (IDD) and Green Buildings. Allow me to elaborate. 

Design for Manufacturing and Assembly (DfMA)

Firstly, we are fundamentally changing the way that we build through DfMA. DfMA allows us to move on-site construction work into a more controlled working environment off-site, to prefabricate building components for on-site assembly. This way, construction becomes faster, cleaner, quieter, and of higher quality. For example, Teambuild, a local builder, achieved close to 37% site productivity gains for its Valley Spring @ Yishun, a HDB BTO project, by adopting Prefabricated Pre-finished Volumetric Construction (PPVC). This enabled significant time savings, and we hope that we can drive greater adoption in the near future.

We are on track to meet our DfMA adoption target of 40% this year, and we aim to achieve an even higher rate of 70% by 2025. This is an ambitious target but I think that we can achieve this by working together with the industry. We aim to make DfMA our default way of building.

Mr Ong Teng Koon asked how our construction productivity compares with other countries. Site productivity data is not available for all countries. However, our site productivity has improved by over 17% in the last decade, which is significant.

To boost DfMA adoption, we enhanced our Buildability Framework last year, raising standards for larger residential developments and allowing outcome-based solutions to encourage building designs that can be constructed more productively.

We will further enhance the framework this year, by progressively requiring higher buildability standards for other development types, including commercial and institutional buildings. We will also re-structure the framework to encourage the industry to incorporate DfMA technology into the structural, architectural and Mechanical, Electrical & Plumbing designs for buildings.

The public sector will also continue to generate lead demand for DfMA. To this end, we will set aside $120 million under the Public Sector Construction Productivity Fund for more public sector projects to adopt DfMA, for projects launched by 2021. 

Integrated Digital Delivery (IDD)

On IDD, the digitalisation of the construction process will facilitate wider deployment of DfMA technologies. Building Information Modelling, or BIM technology, will allow our architects and engineers to design and build in a virtual setting. This improves the accuracy of construction plans, and reduces abortive works downstream. IDD takes this further, by leveraging technology to facilitate better collaboration amongst project parties across the building life-cycle, to coordinate production and supply chains, to build more efficiently, to improve building quality, and to optimise operations and maintenance. For example, Guan Ho, a home-grown construction firm, has been using digital technology to track building components as they are fabricated, delivered and installed at Punggol Town Hub. This has reduced time spent on project management by up to 30%. We want more local firms to use IDD to build smarter and more efficiently.

To help our local SMEs with IDD, BCA, IMDA and SkillsFuture Singapore have developed the Construction and Facilities Management Industry Digital Plan. We will set aside $19 million to fund SMEs to adopt digital solutions that can complement basic BIM software. SMEs will be guided to assess their level of digital readiness, and identify digital solutions that can benefit businesses. For example, site management platforms to plan and monitor construction activities, and facilities management software for operations and maintenance. SMEs can receive up to 70% funding for pre-approved solutions. SMEs can also use the Digital Roadmap on Training to identify digitalisation courses for employees. 

Green Buildings

Our industry transformation efforts are not limited to improving productivity. As DPM emphasised during Budget, we must remake our city to meet the challenges of climate change. Buildings account for over 20% of our emissions. Green buildings are hence an important part of Singapore’s climate change mitigation strategy. Since the launch of BCA’s Green Mark scheme in 2005, we have greened more than 40% of our buildings by GFA. We are on track to meet our target of 80% by 2030. We also launched the Super Low Energy buildings programme in 2018, which goes beyond the Green Mark Platinum standards. For instance, Keppel Land and BCA are working together to transform the Keppel Bay Tower into a Super Low Energy building. The building uses innovative technologies, including a high-efficiency air distribution system and autonomous lighting control, to reduce energy consumption by about 20%. This is a good example of how existing buildings can achieve Super Low Energy standards. Keppel Bay Tower will be the first commercial building fully powered by renewable energy.

We can do more. Over the next few months, BCA will co-create the Singapore Green Building Masterplan 2020 with our stakeholders, as we push the boundaries for Green Buildings. 

And we are considering a few initiatives. First, to push for more energy efficient buildings, we intend to raise the minimum energy performance standards. This will lower emissions, and benefit building owners over the building life-cycle. Concurrently, we will review our Green Mark certification standards, as highlighted by Mr Louis Ng. BCA will engage stakeholders to develop shared aspirations for sustainability standards in the Built Environment, and we need to work out how to get there in partnership.

Next, we want to enable greater transparency in building energy performance. Today, close to 80% of commercial building owners voluntarily opt to disclose their building’s name and address along with their energy performance data, which is published by BCA annually. We intend to identify all buildings when publishing the data henceforth, so that the best performing buildings will serve as role models to encourage others to improve their own energy efficiency. We will share more details by this year.  

We call on stakeholders to co-create the Singapore Green Building Masterplan 2020 with us over the next few months. 

Creating Good PMET Jobs for Locals

Beyond improving firms’ capabilities, transforming the construction sector is also about creating more opportunities for our people, as Mr Gan Thiam Poh, Mr Saktiandi Supaat and Mr Ong Teng Koon mentioned. 

The adoption of new technologies and digitalisation has created new, higher-skilled jobs in better working environments in the construction sector, and generally, they will command higher salaries. For example, with DfMA, we will need more production managers, quality assurance personnel, and logistics and supply chain planners at automated production facilities. Tech-savvy local PMETs can also take on exciting jobs such as digital delivery specialists along with the others in the IDD value chain that I mentioned earlier.

Our sector should be anchored by a skilled and competent local workforce, and our firms must also do their part. The share of local PMETs in construction had fallen over the past decade, even though our total local PMET population had increased. 

To rebalance the share of local PMETs in construction, DPM has announced a reduction in the construction S Pass sub-DRC from 20% currently to 18% in January 2021, and subsequently to 15% in January 2023. 

To help firms build up a strong local core, we are strengthening measures to ensure an adequate pipeline of skilled local PMETs for the industry. BCA and IHLs continually update the curricula of Built Environment courses to meet the industry’s evolving needs. BCA also co-sponsors scholarships and sponsorship programmes with the industry to attract students to pursue relevant courses in our IHLs. 

We will also progressively introduce new Professional Conversion Programmes, or PCPs, to prepare mid-career entrants to join the sector. For example, a PMET from manufacturing could be reskilled as a production manager in a DfMA facility. Hence, we will develop PCPs for prefabrication job roles, and companies such as Teambuild is developing a firm-level PCP, which will be open for applications later this year.

I have also heard feedback about the shortage of BIM modellers, but firms have not been keen to take in mid-career converts before they are trained. Under the current BIM PCP, participants are trained in BIM while concurrently undergoing on-the-job training with their firms. But some firms prefer BIM modellers who can contribute immediately upon hiring. To address this, we will allow participants to complete their full-time training first, before continuing with on-the-job training with their firms. They will complete their BIM training within 3 months on a full-time basis, instead of 6 or 12 months, if they were doing it part time. We hope that more firms will take up the enhanced BIM PCP, which will start later this year, and for the participants, they will receive an allowance of up to 80% of their drawn salary during their full-time training.

To Er Dr Lee Bee Wah’s and Mr Ong Teng Koon’s points on the S Pass sub-DRC cuts, our transformation efforts have created attractive jobs for locals. The S Pass tightening helps level the playing field, and will allow more polytechnic and ITE graduates to access these jobs, including supervisory roles. Our local PMETs will still be able to take on supervisory roles, so long as they are open to reskilling themselves. 

As we push ahead with our transformation efforts, we aim to create more of these attractive jobs for our local PMETs. And I encourage firms to take advantage of our good pipeline of infrastructure projects in the years ahead, and attract more local PMETs to join our sector. A good example is Kimly Construction. Since 2015, Kimly has sponsored 15 undergraduates with BCA, and introduced them to fulfilling careers in the Built Environment sector. Kimly has also groomed three mid-career BIM modellers under the BIM PCP since 2018. Kimly paced out the on-the-job training for these employees to smoothen their transition into the firm, and they are now keen to pick up even more advanced BIM skills, such as 4D/5D BIM simulation.

We have also developed a Skills Framework (SFw) for the Built Environment sector, to map out skillsets required at various levels for key job roles in the construction and facilities management sectors, and their career progression pathways. More details will be announced later this year.

Ensuring the Continued Safety of Our Construction Works  

Moving on to other cuts. Ms Sylvia Lim asked about ensuring the safety of building works.  For any development, the Qualified Person or QP has a duty to ensure that building and structural plans comply with the building control regulations. In addition, all major building works must be independently reviewed by an Accredited Checker, or AC, to ensure that the key structural elements are adequately designed. While the responsibility of ensuring structural safety rests with the QP and AC, BCA conducts sampling checks for each plan submission. Where BCA finds non-compliance with legislative requirements, BCA will take enforcement action, and penalties could include a fine, or imprisonment, or both. 

BCA regularly reviews the Building Control regime to ensure that it is sufficiently robust. BCA has introduced additional requirements since 2017, after the Tampines viaduct incident that Ms Lim mentioned earlier, to raise our standards of building safety. BCA now requires the QPs and builders of higher risk projects to provide additional detailed assessments on the stability of the structure. Together with the Institution of Engineers Singapore, or IES, and the Association of Consulting Engineers Singapore, or ACES, BCA has issued two circulars in 2019 to provide QPs and ACs with guidelines and good practices for plan submissions and supervision. This will help QPs and ACs to improve the quality of their design calculations and ensure that all key structural elements of the project are identified, as well as improve the quality of the QP’s supervision. Measures have been in place since then; therefore, we hope that these measures will improve the safety record of builders moving forward.

Supporting Local Contractors

Er Lee Bee Wah also spoke about supporting local contractors. Singapore cannot discriminate against foreign firms, in line with our WTO obligations. Indeed, we have been helping local firms to build capabilities, as well as strengthen their competitiveness. One way we have done so is by parcelling large Government projects such as MRT lines into smaller contracts, so our local firms are able to take up projects while the Government mitigates its risk. 

In recent years, I am also pleased to see more local firms winning large infrastructure projects. For example, Woh Hup won a $1 billion contract to develop an Integrated Business Park at Punggol Digital District. Straits Construction, another local builder, was part of a joint venture that won the $537 million contract for the Singapore Institute of Technology.

Er Lee Bee Wah also spoke about payment delays due to Variation Orders, or VOs. BCA and MOF have encouraged GPEs to process VOs progressively and expeditiously, to ensure timely payments to contractors. We empathise with the current situation, and will certainly help where needed. For example, agencies can process VOs based on indicative scope and costs. At the same time, contractors should include the necessary documentation to support speedy processing of claims. More recently, we have revised SOPA (the Security of Payment Act), which aims to also help claims for private sector projects.

If Er Lee Bee Wah can share more details with us, including on the treatment of Liquidated Damages (LDs) and progress payments, BCA will look into these specific cases.  

Support for Firms in Response to COVID-19 Outbreak

Let me conclude by addressing concerns from the construction sector arising from COVID-19. BCA has advised government agencies to take a sympathetic view when considering request for Extension of Time, or EOT, for project delays due to COVID-19. We have also sought REDAS’ support for private sector developers to do likewise. We will continue to monitor the situation. If delays are prolonged, we will consider whether additional measures are necessary. To ease cashflow concerns from delays due to COVID-19, main contractors can also submit progress payment claims fortnightly instead of monthly, for public sector projects. We are trying to help firms with their cashflow too. For ongoing PPVC projects affected by delays to the supply of construction materials from China, BCA has adopted a facilitative approach. So far, we have allowed 13 projects to install partially completed PPVC modules on-site first, and install the finishing works subsequently when the delayed materials arrive. We have also provided some flexibility in some of our projects. Some firms with more PRC workers may also face manpower pressure in the short term due to COVID-19. These firms may consider hiring workers from other firms with excess foreign manpower. Firms can search for eligible workers for transfer via the Foreign Construction Workers Directory System, or FCWDS, online. Built Environment firms can also tap on the support packages announced by DPM earlier, such as the SME Working Capital Loan under the Enhanced Enterprise Financing Scheme, and the Jobs Support Scheme. 

Er Lee Bee Wah also suggested measures to help developers and contractors cope with COVID-19. On foreign worker levies, the Minister for Manpower already said during the Budget debate last week that we are waiving levies for employers with eligible foreign workers serving quarantine leave of absence or stay home notices. However, we have not done so for all foreign workers in general. As much as we want to help the sector or businesses deal with the short-term fall-out, this should not negate longer-term efforts for companies to restructure and become less reliant on foreign manpower. Levy waivers would run counter to these objectives. Er Lee Bee Wah and Mr Alex Yam also asked about the Project Completion Period and the ABSD remission timelines. The Government is monitoring the construction industry and the property market closely. We will adjust our policies as necessary to ensure a stable and sustainable property market. We have selectively allowed extensions of the completion period for individual projects because of extenuating circumstances, and would be prepared to consider doing so on a case-by-case basis. But to assure the industry, we have seen just a few appeals; so it is not a big impact thus far. We will continue to monitor the situation and see how it goes.

Even as we deal with the immediate challenges posed by COVID-19, we should not lose sight of our longer-term transformation agenda. I strongly encourage firms to tap on the schemes available under our $780 million BuildSG Transformation Fund, so that we can all emerge stronger and better prepared for the future. 

Conclusion

In closing, we have made good progress, but there is certainly much more that we can do. We will accelerate our efforts to build more productively, create opportunities for our firms and create good jobs for our people. Thank you.