Mr Speaker Sir,

Thank you for allowing me to speak on the Insolvency, Restructuring and Dissolution (Amendment) Bill, a critical step in ensuring that our insolvency framework remains responsive to the needs of businesses, especially the micro and small enterprises that form the backbone of our economy.

This Bill builds upon the SIP - Simplified Insolvency Program, which was introduced in 2021 as a lifeline during the challenging days of the COVID-19 pandemic. Over the years, this programme has proven its value, offering businesses a faster, simpler, and more cost-effective way to restructure their debts or wind-up operations.

With a focus on efficiency and fairness, the proposed changes are designed to provide businesses with the tools they need to navigate financial distress while preserving value for creditors. This simplified framework will be of great help to SMEs in some financial stress, while supporting others to wind down with dignity.

This amendment seeks to do more than extend the program—it aims to refine it. By consolidating eligibility criteria, streamlining processes, and reducing costs, the Bill ensures that these mechanisms remain accessible to the firms of all size including our SMEs, which sends a powerful message: Singapore remains committed to supporting entrepreneurial risk-taking

Sir,

I have some clarifications for the Minister.

1. The Bill's provisions outline the eligibility criteria for businesses seeking to enter the simplified debt restructuring program. I would seek the Minister's views on whether companies with complex ownership structures qualify for the program, such as those with multiple layers of ownership or significant cross-border operations.

2. SMEs with international operations face unique challenges, especially when dealing with creditors across jurisdictions. Will the SIP framework accommodate the specific complexities these businesses face, especially regarding validating their debts or assets in multiple countries?

3. And when a business faces financial distress due to factors beyond its control, such as global supply chain disruptions or international trade restrictions, will such companies be considered eligible for SIP assistance even if their financial difficulties stem from external, non-operational factors?

4. Given the current economic climate of rising inflation and interest rates, can the Minister clarify if the SIP’s entry requirements will be sufficiently flexible to accommodate businesses facing these external challenges? Specifically, will the criteria consider the impact of these economic pressures on a company's financial position, ensuring that otherwise viable businesses aren't unfairly excluded from accessing this crucial support?

This question is particularly pertinent given the findings of the recent Singapore Business Federation's National Business Survey 2024/2025. The survey revealed that customer demand uncertainty has risen sharply from 30% in 2023 to 45% in 2024, becoming the second top challenge for businesses.

Additionally, 51% of businesses have had to implement cost-saving measures to offset rising costs. These statistics underscore the need for flexibility in our insolvency framework.

5. One of the key elements of the proposed amendments is the role of the restructuring adviser in guiding businesses through the simplified debt restructuring process. Given the importance of this role, does the Bill include safeguards to prevent conflicts of interest?

Will there be clear guidelines for how restructuring advisers are selected, and will there be a mechanism for businesses to challenge or request a change of adviser if they feel that the current adviser is not acting in their best interest?

6. I now turn to compliance and penalties under Clause 6, Section 72E(4) The proposed amendments also introduce new compliance and penalty provisions. While this will help ensure that businesses follow the proper procedures, I seek the Minister's clarification on what constitutes "materially false or misleading" statements under the Bill and how these will be assessed.

It would be helpful to understand whether businesses will have the opportunity to rectify any misstatements before penalties are imposed.

7. Also, will there be specific thresholds or guidelines for penalties, and will there be proportionality between the nature of the offence and the consequences for the company involved?

8. An important aspect of this bill is the Support for SMEs with Limited Access to Restructuring Professionals under its general provisions. Will there be financial assistance or subsidies for smaller businesses to help them engage professional advisers, such as restructuring specialists or legal counsel, during the insolvency process?

9. How can the government partner with industry bodies or trade associations to create awareness and provide training for SMEs on navigating the insolvency process? Would the Ministry consider setting up a dedicated SME advisory panel to provide ongoing feedback and suggest improvements?

10. Will there be any provisions to protect employees and other stakeholders, such as suppliers, who may be affected by a company's closure? Since SMEs often rely on close relationships with local suppliers and employees, these parties must be treated fairly during a simplified winding-up process.

11. Finally, I touch on Bill’s emphasis on digital-first processes for filings and notifications. While this is a welcome development, how will the government ensure that SMEs, particularly those without significant digital infrastructure, can adapt to this new approach?

Will assistance or training be available for businesses that may face challenges in transitioning to these digital systems? More broadly, what comprehensive plans are in place to educate our SME community about the SIP and its benefits, particularly on the new changes?

Sir, this Bill is a plus for SMEs, especially in battling the next major economic crisis whenever it happens.

Notwithstanding my clarifications, this bill has my full support.

Thank you.