The NTUC was set up in 1961, following a split in the labour movement over whether Singapore should join the Federation of Malaysia and become independent within a large political entity. Communist elements in the political and trade union circles preferred Singapore to remain under British control so that they could continue to whip up anti-colonial passions, as a prelude to a communist takeover.
The NTUC supported the position taken by the People's Action Party (PAP) that it would be in
Singapore's best interests to become part of Malaysia. So the NTUC and the PAP waged a bitter struggle with the communists who claimed that Malaysia was a Western creation to maintain their dominance in the region.
Communist-led unions mounted a wave of strikes in a bid to undermine the authority of the PAP Government. NTUC unions were just as militant in their pursuit of the legitimate aspirations of workers. But while NTUC unions were able to deliver the goods, the politically-inspired actions by the communist-led unions resulted in company closures and job losses. Many unions crossed from the communist side to the NTUC. In the political arena, opponents of the PAP lost out in the open argument over the merits of Singapore joining Malaysia.
In 1963, the Federation of Malaysia was formed in the teeth of strong opposition from communist countries and the influential communist party in Indonesia. President Sukarno of Indonesia ordered a confrontation of Malaysia. This led to skirmishes between military forces from both countries.
Within Malaysia, sharp differences developed between Singapore and Kuala Lumpur on the sensitive issue of race. The problems led to Singapore's separation from Malaysia in 1965. The PAP Government, backed by the NTUC, then set out to prove our ability to survive, and prosper, against all odds.
Amidst the political uncertainties, the NTUC, the employers and the government signed a Charter for Industrial Progress and a Productivity Code of Practice in 1965. But it was to take quite a while before tripartism was to become a norm in Singapore.
Meanwhile, the crisis facing us deepened after the British announced in 1968 that they would withdraw all military forces from Singapore. This would leave thousands jobless - those working in the British bases or providing services to the troops and their families. There was anxiety over our economy because the British military spending accounted for a significant part of our GDP.
The NTUC supported moves by the government to transform the British military bases for civilian use. Many jobs were saved. To stimulate our economy, the government decided to woo foreign investors in a big way. Laws were enacted to clearly delineate functions of management and those of trade unions. While union leaders understood the rationale for the legislation, they were upset because it reduced their scope for negotiations. Nevertheless, they endorsed the Employment Act after being assured by the government that employers would not be allowed to ride roughshod over workers. NTUC's support for the new law led to a massive inflow of investments.
Still, changes in the labour scene had an unsettling effect on workers in the unionised sector. Morale dipped. Membership dropped to low levels. To turn the tide, the NTUC in 1969 organised a seminar to modernise the Labour Movement. We opted for cooperation instead of confrontation in dealings with management. We also chose to set up cooperatives so as to better meet the social needs of our members.