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Singaporean government to check out 12 services

27 Sep 2004 | (News)

The Singaporean Government has identified 12 services which could be outsourced to private companies as part of the ongoing economy drive.

The functions submitted by government ministries and statutory boards are: library and legal services; human resource; training; carpark services; call centres; IT; facilities, document and project management; security; and finance and accounting.

They will be 'market-tested' - that is, comparing the cost of delivering the functions in-house with what is charged by the private sector. If a private company can deliver a service more cheaply and effectively, it will be hired to do the job. The Government calls this process best-sourcing. The idea is for public agencies to get the best value for their money. They will complete their market-testing by next March, said the Finance Ministry.

Outsourcing has been in the news in recent weeks, with the Manpower Ministry, Singapore Airport Terminal Services and Singapore Airlines announcing that they are farming out jobs. The Finance Ministry told The Sunday Times that government projects contracted out from February last year to June this year have created $24 million worth of business for the private sector.

Best-sourcing has led to some 220 government workers being retrenched, it added. Prime Minister Lee Hsien Loong had introduced market-testing for new government services in the Budget speech last year. This year, the aim is to market-test 5 per cent of non-core functions. Government outsourcing led to $1.8 million in savings last year. Among those which out- sourced projects were:

The Inland Revenue Authority of Singapore, which outsourced its cheque processing to banks last year. It used to process more than 600,000 cheques a year, taking three to six days to clear one cheque. The banks take a day and do it at a much lower cost. The Housing Board, which hived off its parking enforcement services at 30 per cent of its carparks, driveways and service roads, in August last year. Two companies, Premas International and Chubb Singapore, took over the patrolling. Altogether, 214 HDB officers were retrenched.

The Singapore Police Force, which outsourced its vehicle maintenance this year for a $5 million fee, one of the largest contracts farmed out by the civil service. The Economic Development Board, which has been outsourcing property management, IT functions, publications, printing and travel services.

The Urban Redevelopment Authority, which farmed out the processing of cheque payments received through post. Apart from outsourcing some non-core operations, government agencies must also cut their staff by 3 per cent every year over the next three years - or pay $10,000 a year for each extra officer. Up to 8,100 jobs are expected to be cut as a result, through resignations, retirements, redeployment of staff and other staff-trimming measures.

When contacted, most of the 15 ministries and four statutory boards declined to give more details on how they would outsource their operations or cut down staff numbers. But the Ministry of National Development said: 'Should MND not be able to meet the desired target of 3 per cent manpower reduction for each financial year, we will pay the headcount surcharge.'

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