Speech by Minister Desmond Lee at the Singapore Contractors Association Limited (SCAL) Annual Dinner

Oct 2, 2024

I am delighted to be able to join you for your annual dinner. SCAL has come a very long way since your establishment 87 years ago. Today, you represent more than 3,000 construction and allied businesses in Singapore. I would like to say a very big thank you for supporting the transformation of our Built Environment over the years.

Contractors play an important role in the BE sector

Tonight, we pay tribute to generations of men and women in the Built Environment sector, who transformed Singapore into the thriving metropolis that we proudly call home.

As we embark on the next phase of building Singapore, we will continue to rely on the construction sector to deliver our national development needs. These include ambitious projects like Long Island, the Greater Southern Waterfront and Changi T5, as well as homes and public transport for Singaporeans.

These exciting and complex projects will demand more of our sector, but at the same time also provide opportunities for us to push the boundaries of our sector’s transformation. First, we must continue to embrace the latest technologies, to push the frontiers of productivity. Second, we should redesign the way we work, to promote greater collaboration. Third, we must make our construction processes even greener and more sustainable. Let me elaborate on these three points. 

Continue Embracing Technologies

First, let us talk about the need to bring in new technology and ways of construction, to improve our productivity and reduce our reliance on manpower-intensive processes. In many countries, construction firms face manpower shortages, especially skilled workers.

Globally, we expect the manpower crunch to  intensify as more workers remain in their home countries to participate in their home countries’ construction boom. With more competition for manpower, firms that are leaner and less manpower-intensive will find that they have a competitive advantage.

Over the years, we have made good progress in adopting productive technologies, such as Design for Manufacturing and Assembly (DfMA). About 10 years ago, we started the drive for DfMA technologies like PPVC, which allows construction components to be fabricated off-site and assembled on-site. This has allowed us to build faster, better, and with less manual labour. Today, DfMA has been widely applied for large projects, including developments under the Government Land Sales programme.

Going forward, we will need to drive greater adoption of robotics and automation to try to unlock more productivity gains. Some progressive contractors have already started experimenting using such robots.

There are now about 15 robotics and automation solutions being deployed in over 30 construction projects, including for wall skimming & painting; drilling; anchoring; rebar-tying; and tile grouting.

For example, Great Resources (M&E) Contractor Pte Ltd, an M&E sub-contractor, used a drilling and anchoring robot for Prefabricated MEP Systems installation works at JTC Bulim Square where the ceiling was more than 4 metres high. The company found that the robot helped them to enhance productivity, improve quality and consistency, and reduce risks from having workers working-at-height.

As more technologies mature – indeed robotics and automation is still at a nascent stage for the Built Environment sector – we want to encourage more widespread use of robotics and automation, to help you enhance the way you work.

I know that many of you may find adopting new technologies daunting given the costs and risks involved. This is why the Government will continue to provide significant support for you to adopt robotics and automation. If you are keen to invest in these technologies, you can tap on the Productivity Innovation Project (PIP), a grant which provides up to 70% co-funding support for qualifying costs. 

To help our companies identify the latest solutions, BCA regularly organises innovation showcases, such as the recent Technology Exchange on robotics and automation, held at the Built Environment Innovation Hub. Events like that bring together both solution providers as well as end users who have actually deployed robotics and automation solutions to share their experiences with you and with the wider industry.

BCA and our R&D partners are also working closely together to advance more robotics and automation innovations from the laboratory to the market.

So I encourage you to explore this further, go around and look at solutions, and make use of the available support to adopt more innovative building solutions, and to continue transforming the way we build.

Redesign the Way We Work

Second, the need to redesign the way we work, to encourage greater collaboration. Our construction projects are getting increasingly more complex. With higher expectations from our clients, tighter budgets and more pressing timelines, all of us in the construction value chain need to work closely together.

On the Government’s part, we need to improve too. We have been working to enhance our regulatory system, to make our building approval processes more seamless and convenient, via the project known as CORENET X. If it is fully realised, CORENET X should significantly reduce the number of times that your QPs will need to go to various regulatory departments to seek approvals: from over 20 touchpoints today, to 3 main gateways.

This should reduce the time needed to obtain approvals across the development process, and avoid costly abortive work downstream. But to truly benefit from CORENET X, our project teams will need to work together at the design stage to resolve potential design or planning conflicts, upstream. 

Since CORENET X was soft-launched in Dec 2023, we have made some good progress. Several project teams have made voluntary submissions via CORENET X, and have found it helpful to familiarise themselves with the new regulatory process, and make the necessary preparations ahead of mandatory CORENET X adoption.

My colleagues at BCA have also taken in feedback from those participating in the voluntary process, so as to refine our processes and platforms. I encourage all of you to familiarise yourselves with CORENET X by attending the relevant courses.

In particular, I urge project teams to make submissions using CORENET X during this ongoing voluntary submission phase. Try not to wait until CORENET X becomes mainstream before giving it a go. Give it a go now, let us all learn together, let us all make the adjustments together, on the government side and also on the project side.

We fully expect that there will be teething challenges when we roll out CORENET X nationwide, as with any major change that is new, but we are committed to making this work, so that our sector can benefit from more efficient regulatory processes. So help us to help the entire sector.

Let me now turn to another important piece of work, collaborative contracting. Across our developers, consultants and contractors, collaborative contracting will become a key enabler of effective collaboration across our project value chain.

Collaborative contracting puts in place structures - such as monetary bonuses for achieving key performance indicators - to align project parties to common project goals, as well as an early warning mechanism to identify and resolve emerging issues upstream. It will also offer a fairer mechanism for us to share our risks and share the benefits, so that we can encourage firms to use more innovative methods and technologies.

The Government has been actively engaging our industry partners, including SCAL, to facilitate the adoption of collaborative contracting in Singapore. For example, we have developed an option module for collaborative contracting within the Public Sector Standard Conditions of Contract, as well as localised clauses for the international NEC4 contract.

I am glad to learn that CapitaLand Development and its partners, including Nakano Singapore, will be the first in the private sector to adopt the NEC4 contract in their Science Park project. While the NEC4 contract form is new to them, the project team shared that they are optimistic that it will facilitate closer collaboration and enhance project delivery. I applaud the team for being early adopters of collaborative contracting and I wish them all the best for their efforts! I also look forward to more project teams working more collaboratively to deliver better projects in Singapore.

Make Construction Processes Greener and More Sustainable

Third, the need to make our construction processes greener and more sustainable, so that we too in the Built Environment sector can play our part in tackling the serious threat of climate change.

Our Built Environment sector has been making good progress in decarbonising building operations under the Singapore Green Building Masterplan. However, there is more that can be done upstream at the construction phase to support the overall sector’s transformation and decarbonisation efforts.

To do this, our contractors will need to build up relevant capabilities on greener construction. These include developing expertise in recycling construction waste, using more sustainable construction materials, adopting more energy-efficient construction equipment, and building capability in carbon accounting of our construction processes. 

The Government is committed to supporting you in the Built Environment sector in your sustainability efforts. One example is the Energy Efficiency Grant (EEG), and this is for the construction sector which we announced at Budget this year. Since then, my colleagues have consulted industry stakeholders, including SCAL, to identify key construction equipment that you think would be most impactful to greening the construction process.

The Grant will provide up to 70% co-funding support at various caps to construction firms for energy-efficient construction equipment, such as Battery Energy Storage Systems (BESS), electric excavators, wheel loaders and crawler cranes. I encourage you to tap on the grant and embrace more sustainable practices. Applications for the EEG will be opened on the Business Grants Portal at the end of this year.

Rallying Together for the Next Lap

Embracing technologies, redesigning workflows and advancing sustainability are certainly not easy. At SCAL, you have been strong advocates and supporters of our industry transformation efforts over the years.

Through upcoming initiatives that SCAL President had described earlier, such as the “SME helpdesk”, SCAL will be providing customised advisory services to help construction firms embark on transformation efforts. The SME helpdesk will support SMEs in navigating challenges related to digitalisation, productivity enhancements and regulatory compliance, empowering our firms to adopt new technologies and improve operational efficiency. As we embark on the next phase of transformation, I look forward to the continued support and partnership with SCAL. 

Finally, let me congratulate all the outstanding builders receiving awards tonight, for your contributions and achievements.

Thank you all, and have a good evening.