Premier Lai Ching-te’s oral policy report to 4th session of 9th Legislature

  • Date: 2017-09-26
  • Source: Department of Information Services, Executive Yuan

Speaker Su, Deputy Speaker Tsai, members of the Legislature:

The fourth session of the Ninth Legislature has begun. I am both honored and keenly aware of my heavy responsibility as I bring my Cabinet team here to deliver the Executive Yuan’s administrative policy report.
 
I’d like to thank President Tsai Ing-wen for her affirmation and confidence, and for giving me this opportunity to serve the people of Taiwan. Former Premier Lin Chuan headed the Executive Yuan for more than a year, and in that time he tackled all manner of difficulties with the support and supervision of the Legislature, serving as an anchor for the new government and putting President Tsai’s policies into practice. He set the direction for government, and for his service to the nation, I want to express my admiration and gratitude.

The work of nation building and reform is achieved over the long term. It requires that each governing team pass the baton to the next, and never let up. Only by striving ahead can we carry forward overall national development.

Today is my first appearance before the Legislative Yuan following my appointment as premier. I’d like to thank Speaker Su, Deputy Speaker Tsai and the members of the majority and minority parties for your warm hospitality and input. Going forward, it will be my responsibility to lead the Cabinet team and humbly accept the supervision of the Legislative Yuan. The standard to which I will hold my team will be based on my own experience with overseeing the Executive Yuan as a legislator, and I will instruct every ministry and agency to strengthen communication and collaboration with the Legislative Yuan. It is my hope that we will be able to cooperate closely to achieve growth and prosperity for Taiwan.

 

I. A pragmatic, deliberate approach to governance

I will expect and encourage my Cabinet to take a pragmatic, no-nonsense approach to its work. The concepts of clean governance, diligence and love for country will guide us as we work pragmatically and deliberately to promote policies that benefit the nation and people. We will lead Taiwan ahead confidently and in the right direction.

Taiwan presently faces a myriad of challenges, including industrial restructuring, barriers to investment, adjustments to a new labor system, transitioning to new sources of energy, and social issues arising from a falling birth rate and aging population. Issues such as transitional justice, pension reform, judicial reform and tax reform also attract considerable attention, and my Cabinet will confront these matters with honesty, formulate pragmatic policies, seek realistic solutions, and track progress and results. By enhancing our effectiveness, we will accelerate our nation-building efforts, re-energize economic development, and raise both Taiwan’s competitiveness and the people’s standard of living.

The Executive Yuan has already submitted printed copies of our administrative policies report to the Legislature for your reference. Today I will cover only the six economic stimulus measures that we have formulated, as well as five major governing objectives aimed at building up Taiwan.

 

II. Six economic stimulus measures

In the face of international competition, we will actively participate in regional economic integration, expand cooperation with other countries, and enter into bilateral and multilateral trade agreements with various nations. The government will continue to promote our New Southbound Policy by strengthening links and cooperation with target countries.

To build domestic economic momentum, the Executive Yuan will stimulate private-sector consumption, expand public works, lead private-sector investment, encourage private-sector participation in public construction projects, bring about economic transformation, and boost Taiwan’s economic development. Beginning today, our efforts will be fully devoted to the promotion of the following six concrete measures:

First, the government will lead the way in raising salaries.

The central government’s 2018 general budget has incorporated a 3 percent pay raise for public employees—civil servants, teachers and military personnel—to encourage corresponding increases in private-sector wages. Higher salaries for all will boost the economic outlook, expand domestic demand and lead Taiwan into a virtuous cycle of economic growth. We are grateful to see that various commercial and industrial groups, as well as many enterprises and educational institutes, have begun to follow suit.

It is our sincere hope that the Legislative Yuan will be able to complete a timely review of the proposed general budget, so that payment of the new higher salaries can begin on January 1 of 2018. As for the much-discussed question of whether contract employees will also receive raises, I have instructed the Directorate-General of Budget, Accounting and Statistics to distribute special centrally allocated tax revenues to local governments to help cover relevant costs.

Second, the government will reform the tax system.

There exists a national consensus that Taiwan should have a fair, reasonable, streamlined and convenient system of taxation. We have already started with reforms aimed at optimizing the tax system. My team is working on a draft revision to the Income Tax Act, which will include cuts for salary earners and mid-to-low income taxpayers, as well as a suitable tax reduction for small and medium-sized enterprises as well as startups. We will also narrow the unfair gap between the taxes paid by domestic versus foreign investors, and anticipate that this adjustment will revitalize the capital market and advance industry upgrades.

Over 5.42 million taxpayers will benefit from our tax plan, which will be delivered by the middle of next month to the Legislative Yuan for review and voting. I ask for your generous support for this bill so that together we may achieve this difficult reform.

Third, we will drum up investments in Taiwan.

I will personally convene an interministerial meeting on accelerating investment in Taiwan to demonstrate the government’s resolve to improve the economy. We will solve, one after another, the key problems hindering industrial development, and remove barriers to investment. My team will construct a friendly environment for business creation and operations, including ensuring a steady supply of water and electricity, availability of land, and the training and retention of high-skill talent.

We will listen respectfully to the valuable opinions of this esteemed body’s members on the five-day workweek policy, and make revisions to our draft based on what we hear. Our goal is to build a safe and flexible labor system that protects workers’ rights and interests and at the same time attracts corporate investment in Taiwan, thus achieving a working environment advantageous to both employees and employers.

Fourth, the government will promote deregulation.

Taiwan is a small country in a fiercely competitive global environment, and so we must demonstrate greater initiative and greater flexibility. To build economic momentum, our first priority for deregulation will be finance and banking laws. The government will also loosen employment regulations to allow enterprises to better compete for and retain top talent. The Executive Yuan has already submitted to the Legislature a bill to encourage the recruitment and hiring of foreign professionals. We have marked the bill as a high priority for this session, and look forward to early approval and passage, so that more high-level talent from overseas will come to work in Taiwan.

The government will follow up by reviewing administrative controls. Where such rules and regulations exceed the scope required by legislation, we will make changes aimed at removing barriers to corporate investment, and thus create a healthy environment for investors.

Fifth, my Cabinet will speed up the promotion of the Forward-looking Infrastructure Development Program.

To meet the demands of the next generation of national development, the Legislative Yuan has already passed a special bill and the first-term special budget for the Forward-looking Infrastructure Development Program. The program calls for action in eight areas: railway projects to provide safe and fast transportation, water environments to build resilience against climate change, green energy infrastructure to ensure environmental sustainability, digital infrastructure to create a smart and connected nation, urban and rural projects to balance regional development, child care facilities to help reverse declining birth rate trends, infrastructure to ensure food safety, and human resources infrastructure to nurture talent. The government will take the lead on investments in these areas, lighting a match under the economy and expanding domestic demand.

Additional projects target people’s everyday lives. These include installing smart meters, building facilities for a smart electric grid, reducing water loss in the public water supply system, promoting a demonstration project for potable tap water, expanding the use of mobile payment systems, raising the percentage of energy-saving appliances in homes, and encouraging the production of electric cars and scooters. The Executive Yuan has listed all of these projects as important points to promote.

Sixth, the government will continue to pursue the “five plus two” innovative industries policy.

Another goal is to transform production and the structure of industry, from the manufacturing-intensive focus of the past toward a new direction of innovative and high-value-added production. We will continue to carry out innovative industry projects promoting an Asia Silicon Valley, intelligent machinery, green energy technology, biomedicine, national defense, new agriculture and the circular economy. The ultimate objective remains enhancing the international competitiveness of Taiwan’s industry through cooperation with international groups and local governments, bringing in high-level talent, transferring new technologies to Taiwan, building industrial clusters in Taiwan, harnessing the power of system integration, and attracting investment from domestic and foreign sources alike.

At the same time, we will also strengthen the overall planning of national development, enhancing governance capacity, and maintaining effective oversight of progress and spending for major projects. Programs will be completed on time and on spec, with an eye toward expending limited resources only where absolutely necessary.

 

III. Five nation-building objectives

In addition to boosting the domestic economy, we will be striving toward five governing objectives for nation building:

1. “Cultural Taiwan”

Culture is the soul of a nation, so we must nurture Taiwan’s unique culture, demonstrate confidence in it, and enhance its competitiveness from the local level on up to the international level. The Cabinet-level board of cultural affairs will continue leading interministerial efforts to promote the nation’s cultural policies, and I will instruct government agencies to incorporate cultural considerations into their policies. Our focus is to truly deepen Taiwan’s culture and nurture Taiwanese subjectivity.

We will continue implementing a historical sites restoration plan that is designed to breathe new life into tangible cultural assets while forging unique urban and rural landscapes. We will also help local governments to integrate each region’s unique culture into their businesses, tourism industries, agricultural products, and lifestyles, cultivating the “Cultural Taiwan” brand for the world to see.

To promote the cultural and creative industries, we have set up a platform to connect the film, television and music industries with the financial sector, putting them in touch with the resources needed to tap overseas markets. We are also working with local governments and businesses to establish an international film and television production center, build experimental facilities for innovative cultural and creative technologies, and provide service platforms for young artists and emerging industries to create and exhibit their works and conduct transactions.

We are also endeavoring to ensure linguistic equality among different ethnicities and develop a multicultural society. Following the implementation of the Indigenous Languages Development Act, which designated indigenous languages as official languages, we submitted draft amendments to the Hakka Basic Act to the Legislature to recognize Hakka as a national language as well.

2. “Green silicon island”

As countries worldwide switch to new sources of energy, Taiwan has defined its own goals for reducing carbon and becoming a nuclear-free country. We will tap new energy sources, conserve energy, store power and integrate smart energy systems, all of which will transform Taiwan into a safe, clean and sustainable “green silicon island.”

Among our efforts are a two-year solar power plan, a four-year wind power plan, and other renewable energy projects such as biogas development. These programs will spur the development of innovative technologies and create jobs for local communities. And to make Taiwan a key player in Asia’s green energy industry, we are building the Shalun Green Energy Science City as the heart of Taiwan’s green energy industry ecosystem.

In the meantime, we will accelerate the installation of smart grid systems to make our grid less centralized and more resilient. We will maintain a stable and reliable electricity supply while shifting electricity use to non-peak hours, addressing the issue on both the supply and demand sides. Right now we are installing smart electricity meters across the country and promoting a time-of-use pricing scheme, so that users can better manage their energy consumption, curb electricity use at peak times, and conserve energy.

The Diversified Waste Treatment Plan is underway to make waste treatment facilities more efficient. It is expected to generate an additional 180 million kilowatt hours of green energy each year. Bottom ash and slag residues from waste incineration will also be reused as materials in public works projects to ensure construction quality as well as environmental safety.
 
3. Smart digital nation

As a powerhouse of information and communications technology, Taiwan is shifting from hardware contract manufacturing to innovative smart applications. And as we transform into a digital nation for information applications, our young people will have more opportunities to engage in smart tech innovations.

To build a smart digital nation, we will loosen regulations, invest in digital infrastructure, strengthen talent cultivation, and continue to implement the Digital Nation and Innovative Economic Development Plan. Taiwan will leverage its competitive edge in semiconductor chips to harness smart technologies (including artificial intelligence, internet of things and big data analytics) to improve the quality of life as well as government efficiency.

In the development of smart cities, we will consider the needs of each region as we implement a program to create smart living applications for urban and rural areas. We aim to not only solve local problems but also promote urban development.

We will also develop Taiwan’s smart electric scooters into a competitive industry, and expedite innovative R&D for driverless vehicles. When promoting financial technology, we will expand the use of mobile payments. Under our intelligent transportation systems plan, we will use technology to manage traffic, alleviate road traffic congestion, offer convenient transportation in remote and rural areas, and ensure traffic safety.

4. Just society

Justice is our nation’s most fundamental value. We will ensure a dignified life for every citizen, and allocate resources in an equitable manner to guarantee a secure, peaceful way of life for all. We will therefore continue the work of pursuing pension reform, judicial reform, tax reform and transitional justice, all with the goal of promoting social fairness and justice, and ensuring the nation’s sustainable development.

To reinforce our democratic values and protect direct civil rights, we submitted a draft amendment to the Referendum Act to the Legislature, where it has been reviewed and listed as a priority piece of legislation for the current session. A draft of the organization act of the National Human Rights Museum has also been sent to the Legislature for review. After the museum is established, it will be responsible for promoting education on human rights, among other important tasks.

On the issue of same-sex marriage, the Executive Yuan will abide by Judicial Yuan Interpretation No. 748 regarding equal protection of the freedom of marriage. We will forge the widest possible consensus, and with careful deliberation submit reasonable and feasible legislation that will make marriage equality a reality in Taiwan.

To aid economically disadvantaged children and help young people on their path of development, we will continue to sponsor a children and youth education and development fund, as well as an education and employment savings account program for young people. We want every child to receive a proper education so that they can find gainful employment or start their own businesses later in life.

To guarantee a basic standard of living for all workers, the Executive Yuan has approved increases in the national minimum wage. Starting January 1 next year, the monthly rate will be raised to NT$22,000 (US$728), and the hourly rate to NT$140 (US$4.63).

In housing justice, we have begun the process of reviewing and amending the Urban Renewal Act to improve the overall environment for residential homes. We have also completed a set of complementary measures in the Statute for Expediting Reconstruction of Urban Unsafe and Old Buildings.

In indigenous transitional justice, we will continue to protect the rights and interests of the indigenous peoples by expanding their autonomy and cultural and economic development. The Executive Yuan has also submitted to the Legislature amendments to the Status Act for Indigenous Peoples, which would add a new classification to officially recognize members of the Pingpu communities.

We will also reinforce protective measures for women, immigrants, and persons with disabilities to improve the welfare of all citizens.

5. National well-being

As part of our vision to create an environment in which people can live and work in peace and contentment, we will continue pushing policies that promote the health, security and well-being of our nation’s residents.

In the sphere of public safety, we have rolled out a new-generation anti-drug strategy outlining action plans to prevent illegal drugs and drug precursors from entering the country, aggressively pursue drug manufacturers, dealers and traffickers, reduce the population of new users, keep narcotics out of schools, and provide treatment and rehabilitation for addicts. We are also cooperating with other countries to combat cross-border telecom fraud, protect our citizens from monetary loss, and protect Taiwan’s reputation abroad.

Food safety is the issue that most concerns people in this country, so we will tighten safety controls at the source of production, increase inspection rates, and require food producers to adopt self-management measures. We will continue enforcing the five-point food safety policy to give consumers peace of mind.

With an eye toward conservation of land and water resources, together with environmental sustainability, we are vigorously implementing an integrated coastal zone management plan as well as a national wetland conservation guide plan. The “national freeway, green corridor” plan has been launched to turn highways and their surroundings into natural conservation areas as well. We are also in the process of revising the Mining Act to require all mines that lack environmental impact assessments to undergo a supplementary assessment.

To improve air quality, we are promoting the Clean Air Action strategy for reducing average concentrations of PM2.5 (particulate matter smaller than 2.5 micrometers) year by year. Starting next January 1, we will also expand restrictions on the use of plastic shopping bags, a measure that is expected to reduce plastic bag use by 1.5 billion bags each year, and contribute to the creation of a sustainable planet.

The long-term care 2.0 plan is being rolled out in cities and counties across Taiwan to serve the needs of our aging society. This plan will be reviewed on a rolling basis to ensure the quality of care services, allowing senior citizens to live happier and more dignified lives.

In terms of sports development, we will carry out follow-up measures to the recently amended National Sports Act and increase the sports budget each year. The nation’s resources will be used to build a stronger environment for sports development and provide athletes and trainers with security for their futures.

Taiwan had a total fertility rate of only 1.17 children per woman in 2016, with only 208,000 babies born that year. That number could drop below 200,000 this year. As we grapple with the problems of a society with fewer children, we must move quickly and vigorously to create a supportive environment for childbearing and childrearing, ease financial pressures on young parents, build social housing to alleviate housing problems for young people, and raise the birth rate along with women’s labor participation rate. We will also apply fresh thinking and adjust our strategies for the economy, industry and workforce development, and review our immigration policy to make our country stronger and more competitive.

Today’s young people face four main challenges: low salaries, difficulties securing work, housing problems, and uncertainties about the future. It is therefore incumbent on the government to strengthen the technical and vocational education system, bridge the gap between the education students receive and the skills employers require, as well as promote interdisciplinary learning across industry, academia, and research and development. We will also ease education laws to promote alternative education, giving young people more space to start innovative businesses, more opportunities to participate in public affairs, and the freedom to choose their own education and career paths. All of these efforts will help create a more dynamic Taiwan.

 

IV. Joining forces for a stronger Taiwan

Last year I had the opportunity to visit Israel to attend the International Conference of Mayors. As I listened to Prime Minister Benjamin Netanyahu’s address, I realized that Taiwan stands to learn much from Israel. Coming together as a nation will make Taiwan stronger, and we must fulfill our responsibilities to promote regional peace and security.

For many years, my stance on cross-strait relations has been to seek common ground while shelving differences. My hope is to replace conflict with cooperation, and to replace the policy of containment with a policy of exchange. Through interaction and cooperation, the two sides can better understand and appreciate each other, make allowances for each other, and seek reconciliation. Only then will we truly have cross-strait peace and development. As we look ahead at foreign diplomacy and cross-strait relations, the Executive Yuan will uphold President Tsai’s ideal of “steadfast diplomacy, and mutual assistance for mutual benefits,” and we affirm her declaration that “Taiwan’s commitment and good will remain unchanged, but the country will not bow to pressure.” It is in this pragmatic manner that we intend to carry out all of our work.

My esteemed legislators, it is the earnest desire of the people of our nation to see reconciliation between ruling and opposition parties, stability in our society, and peace across the Taiwan Strait. As long as the legislative and executive branches work in concert, and with full public support, I am confident that we can build a more prosperous, more secure, and happier homeland that is truly beautiful.

Finally, I respectfully request that you continue to give us your valuable counsel and suggestions. I also want to express sincere thanks to legislators of all parties for your untiring efforts. Let me close by wishing one and all the very best of health, and success in all your endeavors.

Thank you!