Augustine H.H. Tan
Singapore
“There are instances when reserves should be used, but the govern- ment has to make a case to the President and if good arguments are used, the President is expected to concur. I therefore end by asking you, as you have done in your speeches, to support this Bill with a very loud "Aye" when it comes to the vote. [Applause].”
“We must have confidence that in the end, as Singaporeans, we know what is overall best for ourselves. We are a community of free citizens committed to making Singapore a great city to live in and for foreigners to come visit and admire.”
“There is such a thing as initiative. Who initiated the project? What was the objective of the project? And there is such a thing as economies of scale, the benefits of which are passed on to the taxi drivers. Let us not forget those elements. An hon. Member: They do not pay tax on their income.”
“They can still enjoy the seafood regardless of the indigestion. They can do the shopping and do other things in Johor Baru. I believe that what is important for us is that we do not preclude ourselves the option of setting our own national policies.”
“Mr Speaker, Sir, the Minister stated that it is undesirable to employ foreigners to run child care centres because they affect the values of our children. Is it not also true that by having foreign maids in our homes that they too directly impact upon the values of our children?”
“It was a point which I brought out much earlier when a similar matter was debated here in Parliament. Because the government could borrow on the basis of the reserves even though the President has one key to the reserves because there is such a thing as credit-worthiness of the country.”
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“There are instances when reserves should be used, but the govern- ment has to make a case to the President and if good arguments are used, the President is expected to concur. I therefore end by asking you, as you have done in your speeches, to support this Bill with a very loud "Aye" when it comes to the vote. [Applause].”
“' In other words, they want to use reserves and they think if they are elected by the people, they have the right to use the reserves for welfare programmes. Another remark of his: 'If the Opposition is in power, the Elected President's powers can cause total paralysis as the Opposition cannot use reserves to govern.' I think these are very telling comments. They would want to go before the electorate, promise welfare programmes and they would use the reserves, spend them on free housing, free health, free education, and get elected. And if they are elected on that basis, they must spend our reserves, is it not so? Then what happens after one term? It is precisely for this reason that there may be such people going out to sell Singapore away and getting themselves elected that we have proposed the scheme of an Elected President, just in case we end up with a freak election result. Just in case that happens, we have a preventive measure so that the country cannot be bankrupted or ruined forever. I think that is the real reason why the Opposition parties are against this scheme, because they hope to be able to promise all kinds of popular welfare programmes in order to win votes and they are unhappy that we are putting a stop to this. There are a few other points which MPs have raised, such as definition of "reserves" and a few technical details. I think we should leave them to the Select Committee to handle. I want to end by thanking Members for their contribution and I want to again summarise by saying that we are creating a scheme to protect our future. And this scheme is to have an Elected President to safeguard our reserves, to safeguard the integrity of the public services. It does not mean that no government can use the reserves.”
“In fact, it is another red herring, another bone which he has thrown out for the electorate to chase. But I do not think we should make a mistake over here in chasing that bone, because to me it is an indication of a lack of counter argument against our proposal. So you throw out another bone, hoping that the dogs would chase it and you forget about the arguments for the proposal. Mr Eugene Yap, along with some other MPs, argued that there is some inconsistency in creating this scheme, in having the President elected with a simple majority when you require two-thirds majority in a referendum to remove him. We did this on purpose. If I may use an analogy, if you have a house and you are trying to instal a security system, you want a system that is easy to instal and easy to operate. But you want a system that is very difficult for potential thieves, robbers or burglars to dismantle. You have your switch for the system inside the house. You do not put it in an easily accessible place, or put it outside, so that others can switch it off. So we have on purpose made it difficult for anyone to try and dismantle the system. For him to be elected, I think we follow the procedure as for Members of Parliament. That means you elect him with a simple majority. I want to address now what I think is the real reason for the vehement opposition to this scheme by Dr Lee Siew-Choh and members of the Opposition. I think Dr Lee unwittingly let it out when he said and I quote him, based on my scripting yesterday, which may not be his exact words: 'It is not democratic to disallow reserves to be used by Government for welfare programmes.”
“And I was also watching the results of the elections. Had we lost maybe 15-20 seats, I would have taken that as a rebuff of our proposal to have an Elected President, because we had made it an issue in the elections. And had that been the result, my attitude would be different today. Yes, that was an indication handed out to me by the electorate. They wanted a referendum, because the Opposition was pressing for it and the Opposition wanted to deny us a two-thirds majority in Parliament. They failed. But, nevertheless, if 15-20 seats were lost, perhaps we go for a referendum, despite my stated position that I do not believe in governing through a referendum. But all those are so much water under the bridge. Mr Chiam set out to deny the PAP two-thirds of the number of seats in the last elections. We won 80 out of 81. The Workers' Party, of whom Dr Lee Siew-Choh is a member, campaigned with the slogan that it was time for change. In other words, in the last elections, they were campaigning to be in this House as Government. What was the result? Not a single Workers' Party candidate was elected. The Opposition looks at 62% of the votes for the PAP as a failure of the PAP. I find that very strange. Because if you look around the world, how many parties in the world can claim that they have this margin before forming the government? Australia, Britain, France, I believe, most of the time they did not even win more than 50% of the votes. So it is strange that to the Workers' Party 62% for the PAP indicates the imminent demise of the PAP. I would put it the other way round. You campaigned to form the government in the last elections, 62% said no to you. But this is just to address the point made by Dr Lee Siew-Choh.”
“It was resolved by the President nominating somebody else and that somebody else is Mr Cheney, the present Secretary of Defence. Likewise, in Singapore, should the Prime Minister's nomination be rejected for the first time by the President, then he has to submit a new name for the second time. If he is again rejected, then he will do so for the third time, which was what President Reagan did in respect of judges. The fear that there will be a real impasse that can paralyse the governing of the country, I think, is not based on genuine foundation. Go through the use of veto power or reserves and the appointment of people, how would that paralyse or freeze up government? Yes, I think the Chairman of PSC may not be appointed for a while, or a Chairman of a Board or a member of a Board. But how does that prevent governing from going on? I want now to deal very briefly with this need for a referendum. This a separate issue. Whether we have a referendum or not does not in any way argue for or against the principles of the Bill. The merits of the case should not depend on whether you have a referendum or not. Do you have good arguments against the Elected President proposal? If you have, argue them here or argue them in the Select Committee, and not just create a smoke-screen for a referendum to replace your lack of arguments against the proposal. I was prepared to consider a referendum when we debated the issue before the elections in 1988. At that point of time, I kept my options open. I was watching for an indication from the electorate on how the arguments would go, whether they have good arguments against us. If there are, and both sides can make out a good case for or against the proposal, yes, then perhaps we go for a referendum.”
“I think that is a more valid concern because it is possible that the President will, from time to time, disagree with the elected Government and then you have an impasse. What do you do under such circumstances? We have also addressed that and I believe the way we have crafted this proposal allows for the Government to carry on without the whole country being paralysed. The use of reserves. We have gone through this override mechanism. Let us say that the budget of the government is disapproved by the Elected President. Does governing come to a halt? Are civil servants not paid because there are no funds available? The proposal is, if the new budget is not approved by the President, the Government can fall back on the old budget which has been approved. So funds are available, governing can carry on whilst the Government submits a fresh budget for approval by the President. On key appointments, yes, the President can withhold consent and the Government has no way to override that veto of the President, should he exercise it. Is it a situation different from the situation in the United States? You will remember that President Bush nominated Mr John Tower as Secretary of Defence. The Senate Committee, headed by Senator Nunn, rejected that nomination. Two reasons were given. One was Mr John Tower was a defence consultant and, as defence consultant, he dealt with defence industry contractors and, therefore, there was a conflict of interest in his becoming Secretary of Defence. The other reason was the private life of John Tower which the Committee found objectionable. Have you an actual example of an impasse between the President and the Senate Committee? How was that resolved?”
“Now, let us deal with the emotional issue, too much power in the hand of one person. To me, I think this is just nothing but an emotional reaction, a gut reaction that we are creating a position and investing too much power in one man. Let us examine this logically and objectively. Are we, in fact, giving absolute power to one man so that he will be corrupted absolutely, to address the fear of Dr Lee Siew-Choh? What powers are we giving to the Elected President? He has the power to veto a Supply Bill when that Supply Bill dips into past reserves. But there is an override mechanism to that. Unless members of the Council agree with him, his veto will have to be referred back to this House. In other words, he is not alone in exercising that veto power. And if he goes against the advice of the Council, the House can override him by a two-thirds majority. On key appointments, what powers are we giving him? He does not appoint any member to the Public Service Commission or to the statutory boards. He merely has the power to withdraw consent, if he does not agree with the nomination of the Prime Minister or the Government. To weigh his power against the power of the Prime Minister, who has more power? I think it is clear that the Prime Minister has much more power than the President. The President's powers are limited to certain well-defined areas and even then there is a system of check on his exercise of power. We should not be taken in by glib remarks that we are giving too much power to one person. I think that is only an emotional reaction. It is not based on logic or facts. A more valid concern is when the President disagrees with the Prime Minister and there is an impasse, or sometimes, a constitutional crisis.”
“If we have a Vice-President and you do not allow him to hold office of profit or a job, other than his particular position, how do you occupy his time? It is a practical problem. We do not want to have a very high-powered man who can be your President to be doing nothing for six years. We, therefore, decided to drop the proposal of Vice-President and make the proviso that should, for any reason, the President is not available, the Chief Justice will act. If the Chief Justice is not available, the Speaker will then act. It is debatable whether the Speaker should come first, or the Chief Justice. Dr Koh Lam Son prefers the Speaker to act as President, when the President is not available. Again, we can consider that. Our preference for the Chief Justice is based on what we think may be a public perception that the Speaker and the President may come from the same party and when the Speaker moves up to the position of Acting President, he may, therefore, not be that objective. But this is a public perception we are taking care of, because I believe that when the Speaker acts as President, he is wearing a different hat and he should be functioning as Acting President. So, it is not a strong argument against having the Speaker acting as President. The argument against the Chief Justice acting as President is perhaps stronger because the Chief Justice is a very busy man. If he has to act as President for a long period of time, you are taking him away from the courts. We weighed the arguments for and against the Chief Justice or the Speaker and we settled for the Chief Justice. Between the two, if you want to have further debate on this and reverse the order, I think it is possible to take this up at the Select Committee.”
“If I have to give you an indication, and I have not thought this through, mind you, on who should be on the Presidential Elections Committee, I would think the following would qualify: the Chief Justice, or someone from the Bench, or a retired judge, the Chairman, Public Service Commission or a member of the Public Service Commission, the Speaker, or former Speakers of Parliament, and perhaps former Ministers. I think thess people would qualify to be on the Presidential Elections Committee. But this is a matter which I want to spend further time on before we flesh out the Bill on the Committee and the procedures to elect the President. Mr Ibrahim Othman asked how will the Elected President be elected. Let us wait for the Bill and see how he will be elected. I think we will follow generally the procedures that we have for electing Members of Parliament. He makes an important point that we should not allow money politics to enter into the elections. He wants us to cap the expenditure per voter. That is a good idea and we will follow the same criteria that we have for election of MPs. If we cap it at 50 cents per voter for electing an MP, we should also cap it at 50 cents per voter for electing the President, perhaps even less, because we are refer- ring to Singapore as a whole constituency for the election of the President. We have dropped the Vice-President as a running mate for the President. This is because some MPs were opposed to the idea when we debated this issue the last time. Our reason for dropping it is the difficulty of finding a running mate for the President. He does not have a full-time job. Our original proposal was for a Vice-President who can be a Minister.”
“Intimidation can be exerted on the President, so you should also be looking for persons with physical courage. On the suggestion that we should widen the criteria, if you read the clauses carefully, you will notice that, in fact, almost anyone is eligible to stand for election as President, provided he can satisfy the Presidential Elections Committee that he is a person with such experience and qualifications as are necessary for him to carry out effectively the functions and duties of the office of President. The next clause states that a person shall be deemed to have the experience and qualifications referred to earlier. Now, these people who are listed in the pro- posed Article 18, sub-clause 3, will not have to satisfy the Presidential Elections Committee because they are deemed to have the experience. But anybody else who wants to stand for election as President will have to appear or will have to be vetted by this Committee. And if they are deemed to have the experience and qualifications, I think they can stand. If this is not clear enough, we can get the draftsman to refine this to have a catch-all clause to ensure that qualified people who are not listed in Article 18 can be considered. In practice, MPs can also be eligible to become President. But I would also make this practical point. If there is an MP with the potential to be an Elected President, you will find him sitting on the Front bench, long before he becomes an Elected President. On details of the Presidential Elections Committee, this will be spelt out in a separate Bill. Who will be members of the Presidential Elections Committee?”
“But I think more have argued that perhaps the criteria are too restrictive. They want the criteria to be widened so that more can stand for election as Elected President. The list that we have in the Bill indicating who are deemed to have the qualifications, such as Ministers, Judges, Chairman of statutory boards and Boards of Directors of big companies, are no more than a proxy for the attributes that we are looking for. We are actually looking for people with competence. They must be competent people before they can stand for election. Secondly, they must be trustworthy. Thirdly, they must have sound judgement. That means, when they look at the situation they can come to the right conclusion. They assess people, they know who are opportunists, who are crooks and who are honest people. That is very important. They must have the moral courage because the President may come from the same party as the Prime Minister. But if he disagrees with the Prime Minister on the use of reserves for wasteful welfare programmes, then the Elected President must have the moral courage to tell the Prime Minister that he is not going to spend the reserves. Lastly, and I think this is also an important quality, the President must have physical courage. Physical courage comes in because it is possible that a government could have won an election on the promise of spending the reserves with welfare programmes, and having been elected, that government has been stopped by the President from spending it. Can you imagine the groundswell that could be agitated, the intimidation that could be mounted on the President, the harassment that he will get, because the President is one man and he is not out there politicking?”
“But whatever numbers that we have, we settle for equal weightage, that means, the President will nominate a certain number, the Prime Minister will nominate an equal number, and the Chairman, PSC an equal number. But in essence, we can consider this proposal that we expand the Presidential Council to have a maximum of 12. But I will recommend that we leave it to the President to decide, if we do go for 12 if it is the maximum, on how many he needs to start off the scheme. But perhaps we can build in a proviso that whatever number that he chooses, there should be equal weightage - 3, 3, 3 or 4, 4, 4. That explains why we did not opt for an odd number of seven. I think it was Dr Ong Chit Chung who suggested that it should be perhaps an odd number - seven instead of six - because of this formula of equal weightage for three people nominating members for the Council. The quality of members of the Presidential Council is very important. This point has been emphasised by some Members. Dr Ong suggested that we should perhaps have criteria to ensure that members meet with our expectations. Perhaps it is not necessary since these are appointed members and we must expect that the President, the Prime Minister and Chairman, PSC would know the kind of people that should be members of the Council. We should have faith in their judgement as to who they nominate on the Council. But they should be heavyweights, ie, people who are publicly known for their interest, their integrity, their ability to judge people and the ability to take objective views, read accounts and have the moral courage, if necessary, to ensure that our reserves are not ill-spent. The criteria for Elected President are very important. Some Members have argued that perhaps we are not stringent enough.”
“And we are proposing that there will be one elected senator, and that is the President. In essence, there is no difference between our proposal and the suggestion that there should be an Upper House to supervise or to comment on Bills debated in this House. We think this scheme is more workable because when you have a Senate, and let us assume it is an elected Senate, first, you have the problem of finding a sufficient number of people to stand for elections to the Senate. You need about 20 to 30 people to make it effective. And secondly, how do we ensure that people who are elected into the Senate have the qualities which we are looking for? There is no control. It is an Upper House which in a sense duplicates the functions of the Lower House. In other words, we should be looking for 20 to 30 senators who are politically superior to Members of this House. Can you find them? If you can, and you are satisfied that these are people who can look after our interests much better than MPs over here, perhaps you can give it a try. But I suggest that for the time being, let us concentrate on a small Upper House, a small Senate with six appointed Council members to advise one elected Senator or the President. We have control over the quality of men or women who will be on the Council and there are certain safeguards to ensure that the person who stands for election as Elected President has the desired attributes. Some Members of Parliament have commented that perhaps we should expand the Council from six to 12, that means, you set a minimum of six and then you add six more to make it a maximum of 12. I think we can consider that.”
“We tabled the White Paper before this House last year. They have been given more than a year to come up with an alternative that is more workable, that is better than our Elected President proposal. But up to now, we have not heard any. And neither have we heard better alternatives from people outside this House, members of the public who are unhappy with the Elected President proposal. There is no clear rival to this scheme that we have. It is not sufficient to criticise the scheme because that does not solve the problem. In criticising the scheme, one must also address the problem and try to come up with a solution. That is what we are here for. Our proposal is to create a team that can help us to safeguard our reserves. In other words, have a goalkeeper together with a team of defenders. We are in a sense creating a de facto Senate, as pointed out by Mr Chew Heng Ching. And this perhaps, as some Members commented, could be an alternative to the Elected President proposal. So let us examine the merit of an Upper House to control our reserves, safeguard the integrity of our public services with this proposal and see whether there are arguments for our scheme or whether there are in fact differences between our scheme. A Senate can comprise members who are elected by the people, that means, an all-elected Senate. Or you can have an all-appointed Senate, that means, all members to be appointed by the President or by the Prime Minister, but they are appointed into the Senate. Or you can have a mixture of appointees and elected senators. What are we creating over here with our proposal? We are proposing that there will be six appointed senators who form the Council that will advise the President.”
“Tell the foreigners we do not like foreign investments to be in Singapore. Money flows out of Singapore. MAS tries to defend the exchange rate, reserves are drawn down straightaway. In other words, we can elect the best President of the day but if we get a bad government, everything can be lost even with these safeguards. To me, it is rather ironical that we spend so much time debating about the ideal qualifications of the Presidency, but there is no discussion of the qualifications of the Prime Minister who is a more important person even in the new set-up. There are no minimum qualifications for Members of Parliament, short of bankruptcy or having some jail sentence or other. In other words, any Tom, Dick and Harry could become Prime Minister under our new system. Perhaps at some stage, the Government might want to consider minimum qualifications for MPs and for Prime Minister. The First Deputy Prime Minister and Minister for Defence (Mr Goh Chok Tong): Mr Speaker, Sir, first of all, I would like to thank all the MPs for their contributions and for their very clear support of the principles behind the Bill. I believe the Opposition MP, Dr Lee Siew-Choh, also supports the objectives of the Bill. Am I right, Dr Lee? Yes, I think he is nodding his head. In other words, if he supports the intent and objectives of the Bill, I think he should also support the principles behind the Bill. So what is at issue now is how do we safeguard our reserves and how do we safeguard the integrity of the civil service. That is the issue. It is not the principles of the Bill, because I think we are all agreed. Even Dr Lee Siew-Choh agrees with that. Now, our proposal is the Elected President. I have not heard an alternative proposal from the Opposition MPs or from Dr Lee Siew-Choh.”
“The Bill seeks to prevent the government of the day from incurring a budget deficit which requires financing via a drawdown of reserves or borrowing money. But it does not cover the issue of money or the printing of money by the Government. I know that our system requires one unit of foreign exchange for one unit of Singapore dollar. But there are ways to create money without creating actual currency in circulation. You can increase bank deposits. And I see that the MAS is specifically exempted from the powers of the new President. Then a government could introduce a balanced budget at the beginning of the year, get the approval of the President and somewhere during the year give away money via tax reductions, and thereby incurring a budget deficit. That would force the hand of the President to finance the budget deficit that is actually produced. Or you could have an unforeseen circumstance of sudden recession, sudden loss of confidence whereby tax revenues are less than what they were anticipated and a budget deficit is created, in which case the President has again to step in to help resolve the issue. But more importantly, Sir, there is nothing in the Bill to prevent a government from taxing and spending and maintaining a balanced budget. Theoretically, any government could just increase tax revenues and expenditures simultaneously. In other words, increase the size of the public sector to the point where the whole economy becomes totally inefficient. There is no limitation whatsoever on this score. I would like to see some such safeguard built into our system somewhere. And of course any government of the day without touching reserves while maintaining a balanced budget can destroy confidence in Singapore altogether. Very simply, be xenophobic.”
“Mr Speaker, Sir, I rise to support this Bill. Sir, we have a rare privilege of belonging to one of the few countries in the world that can talk about safeguarding its reserves and preserving the integrity of its public service. Sir, may I be allowed to make a few comments about the nature of our reserves and its relationship to exchange rates and confidence. Our reserves have been built up from three basic components: first, savings by the public sector - that speaks of the financial prudence of the Government; second, the CPF savings which belong to all of us; and third, the investment capital that has come into Singapore as a result of confidence in the Singapore economy. We have about $42 billion worth of reserves today. But I want to show you the figures on money supply to show you the nature of these reserves and how sensitive they are. Money supply, as defined by M1 (that is currency in active circulation plus demand deposits), $13.7 billion; money supply, as defined by M2, $51.4 billion; money supply, as defined by M3, $64 billion. Why do I draw attention to these figures? Very simply, because if people lose confidence in Singapore, the reserves can disappear overnight. If MAS tries to defend the exchange rate when money is going up, that is how the reserves can be lost. If we do not care about our exchange rate and let the money fall to zero in terms of other currencies, then you can hang on to those reserves for what they are worth. But as long as there is a relationship between exchange rate and reserves, we see that the confidence is a vital factor. Viewed in that light, I see this Bill as a good safeguard. But I wonder whether it is sufficient.”
“I believe that if we allow the mass media greater private channels and if we allow private schools, private colleges and private universities to be established, I believe that we can greatly facilitate the acquisition of high technology and much needed information for a modern economy. Finally, Sir, may I briefly deal with some global developments. This year, in the global economy, there is concern with inflation and therefore interest rates are likely to rise. And if interest rates rise, stock markets are likely to be dampened. For the US itself, I believe that the probability of recession is low. But for Japan, it has to do a balancing act between a higher Yen or stronger asset values; in other words, to have higher interest rates or lower interest rates. It becomes a problem for Japan. But we need to look at what is happening in Eastern Europe. Firstly, the German reunification and its impact on Europe and the EEC. And secondly, more importantly, the capital requirements to re-construct Eastern Europe might mean a diversion of capital from other parts of the world. Again, another factor likely to push up interest rates. What are the implications for Singapore? I believe, a tougher international environment. We have to watch the competition, particularly our new competitors, like Thailand, Malaysia. We need to exploit new markets, and I am glad that the Trade Development Board is already trying to get to Eastern Europe. We need to improve productivity, properly measured, and we need to avoid over-heating. So I say - watch the money supply!”
“The typical Chinese businessman keeps three sets of accounts - one for himself, one for his partner, and one for the Government. I have an alternative proposal to make to the Government. Firstly, the Government saves all the surpluses each year instead of giving away by way of tax rebates in order to earn investment income in the future. Members would note that last year investment income gave us 30.7% of total Government revenue, ie, nearly one-third of Government revenue came from investment income. There is no reason why this source of income, this source of revenue, cannot increase if we continue to be prudent in our fiscal policy and save the surpluses instead of giving them away each year. Secondly, in line with this, the Government should trim the size of the public sector. The Government alone in terms of its expenditure accounted for 19% of the GNP last year. If you add the 10 statutory boards, the percentage was 33.7%. If you count revenue as a percentage of GNP, Government accounted for 27.5% last year and Government plus the 10 statutory boards, 45.1%. In other words, the public sector as a whole commands a sizable portion of our economy. I believe that efficiency would require the public sector to scale down some of these activities. The surplus of the Government alone was 8.5% of the GNP last year and inclusive of the 10 statutory boards 11.3% of GNP. That has added to our savings. At the same time, we should allow a more creative environment suitable for a high-tech economy.”
“We have now given a host of tax incentives. In fact, I think a new industry is flourishing, teaching people how to take advantage of our tax incentives. With such a bewildering array, it is time for a proper evaluation and I hope by the time of the next budget, before the Minister asks for further tax incentives he had better give us an accounting of what has been achieved so far. In his Budget Statement the Minister said that this year he is going to introduce legislation for a comprehensive goods and services tax. The idea, I suppose, is gradually to replace the income and corporate tax and allow further reductions in these rates and to shift more to indirect taxes. I would appeal to the Minister to reconsider this seriously because indirect taxes, such as consumption taxes, are very regressive. Look at the recent example in Japan where the LDP nearly lost its majority because of the consumption tax. Prime Minister Margaret Thatcher in the UK is now in trouble because she boldly introduced a Poll Tax, that means a head tax on everybody in Britain. Sir, one of the perceptive writers in the Straits Times made the comment that equity issues are very much in view today in Singapore. We have reached a certain point in our development where we have to be concerned not merely for efficiency but also for equity. I believe there are real political constraints. I would not like to see all that we have achieved over 30 years wiped out simply because the electorate does not like a consumption tax and therefore gets rid of the PAP Government. Further, I believe a consumption tax is very messy, a value-added tax is particularly messy for a trading economy, for entrepot activities and for tourism. First of all, many of our small enterprises lack a clear accounting system.”
“The Economic Survey noted that only 5.7% of the 208,500 training places given by the Skills Development Fund were taken up by workers who were more than 40 years of age. Clearly, we need to do more to encourage the older workers to acquire greater skills and retraining. Another problem which no Member has touched upon, neither has the Finance Minister, is a problem of rising rents and interest rates. There is no discussion of the possible impact of both of these on business costs. I believe that if one looks at the experience of 1980 to 1984, one of the factors that made us uncompetitive was rising rents and rising interest rates. We are now at a point in the business cycle where the construction industry is reviving, precisely because the existing capacity, both residential, commercial and hotel have been taken up or are being taken up rapidly, and rents are therefore rising. It will take some time before new capacity is added. Therefore, I would urge the Government to monitor rising rents rather carefully and not to exacerbate the problem by increasing rents for the public sector unduly. At the same time, Sir, with hotel occupancy at very high levels, hotel rates are on the rise and will continue to rise this year. This will have some adverse impact on tourism. May I briefly review our tax measures? Members would have noted that the Finance Minister gave away $168 million, the figures he actually gave for certain tax rebates. But of course there were other tax incentives which he gave for which he gave no estimate of what is the cost in terms of revenue. This is an area of some concern to me. I raised this issue last year and I would like to repeat it again that I would like to see a proper study of the cost and benefits of tax incentives.”
“7 of the Economic Survey showed that the wages for professionals rose only by 7.8%; clerical workers and so on, 7.6%; production workers, 8.8%. These are averages and yet produced an overall average for all workers of 10.3%. I am just wondering how that average was arrived at. Obviously, somebody did not look at the figures properly. My second puzzle has to do with the measurement of productivity. In the Economic Survey it was noted that last year productivity increased by 4.8% per worker. But if you adjust for hours of work, the productivity increase was only 2.5%, in other words, it was much lower. The conclusion of the Economic Survey was that the higher output was achieved by workers working longer hours but with decreasing marginal productivity. I suggest that there is a little problem with the figures here. I believe that the Bill to cane illegal workers caused an apparent drop in productivity. How did this come about? In a footnote in one of the tables of the Economic Survey, it is stated that large numbers of illegal workers were legalized last year. I believe that inflated the number of recorded workers, particularly in construction. Therefore, construction reputedly achieved a negative 3.9% decrease in productivity. I cannot believe that figure at all. I believe we need to tighten our measures, especially on productivity, if we want to guide Government policy in the right way. Sir, I know we have done a lot to improve productivity in Singapore, particularly to upgrade skills and to improve the avenues for education, including technical and tertiary education. I commend these efforts. However, we should all take note that the workers who need help the most, namely, those over the age of 40 have resisted the acquisition of skills and/or retraining.”
“This would seem to imply an under-valued exchange rate. If we are not careful we may repeat the experience of the early 1980s. Another indication that this is so is that the financial services sector grew by 21.7% last year and contributed about 32% of the total GDP growth. If you look at the volume of bank loans, it seems to indicate that a lot of the money credit went into speculative activities. At the same time, the CPI rose by 2.4%, still low by international standards but, by Singaporean standards, higher than usual and therefore we ought to take note. The Economic Survey says that the cause was largely local but I believe a stronger Singapore dollar could have reduced the CPI. Another and perhaps more serious concern is the productivity wage gap. For 1985 to 1987 the rate of productivity increase was greater than the rate of wage increase. That, I believe, helped our recovery. But in 1988 and 1989 our wage increases were greater than our productivity increases. From 1980 to 1984 we had a similar experience, namely, wages outstripped productivity increases. The result of this for last year was that the share of wages in the GDP rose from 40% to 41%. Of course, we all want our workers to enjoy higher standards of living and a bigger share of the economic pie. But at the same time we do need to look at the gap between productivity and wages. I have got two puzzles for the Finance Minister. One is in regard to the actual wage increase. In his Budget Statement he mentioned that nominal wages rose by 12.5% and that implied that real wages rose by 10.1%. The Economic Survey, however, stated that nominal wages rose by 10.3% and real wages 7.9%. Quite clearly there is a discrepancy. At the same time, Appendix Table A6.”
“And we had new competitors coming on to the world scene, particularly for us our neighbours, Thailand and Malaysia. We have paid much attention to the other newly industrialising countries in Asia, but I believe not much attention to the newly emerging industrialising countries. But we have certain strengths in our economy that we can maximise to our advantage. First, is our sound fiscal system. Secondly, our high savings rate, which I believe is the highest in the world reaching 43% last year. Thirdly, the high savings rate together with a prudent fiscal policy enabled us to be a net exporter of capital to the extent of 8.9% of our GNP. As a proportion of GNP, our export of capital must surely rank among the highest in the world today. That is not a mean achievement at all. Fourthly, our rate of investment last year was a healthy 18% increase compared to 8.2% in 1988. What is especially encouraging about that investment last year was that nearly half comprised machinery and equipment and that will build up our productive capacity for the future. The fifth thing to note about our strength last year was the recovery of the construction industry. We rejoice that from a -4.4% in 1988 the sector grew by 1.3% and it has been an accelerating rate of recovery because in the fourth quarter it was at the rate of 7%. But having highlighted these areas of strength, we should not forget that there are problem areas for us to look into. At this moment, relatively small problems but, if unchecked, these problems can fester and grow. One concern of mine is that last year our money supply appeared to increase rather too rapidly. M1 increased by 14.9%, compared to 8.4% in 1988. M2 increased by 22.5%, compared to 13.5% in 1988; M3 by 21.2%, compared to 12% in 1988.”
“Mr Speaker, Sir, I rise to join my colleagues in this House to congratulate the Minister for Finance on the budget. I agree with many of my colleagues that it is a difficult budget to find fault with, because it bears the traditional hallmark of prudence. Mr Chiam See Tong just asked the question: what is there for us to celebrate in the budget? He should be reminded that not many countries in the world can boast of a budget surplus and a buoyant economy at the same time. We are celebrating an economy that offers its people full employment, in fact, over full employment because we have to import labour, adequate housing and a rising standard of living with low inflation. Perhaps Mr Chiam should visit those countries that suffer perennial or chronic budget deficits. Then he will realise the pain that is involved in order to solve those deficits. Those governments have to borrow money, beg money, and print money, causing their people tremendous distress and high unemployment together with inflation. So we have much to be thankful about and much to celebrate about. I shall, however, endeavour to evaluate the budget in the light of Government's announced economic and social objectives, both short-term and long-term. First, may I review our economic performance for last year. The Economic Survey noted the slower growth rate in manufacturing, 9.9% last year as opposed to 18% in 1988. The commerce sector similarly had its growth rate halved to only 8.3%. And the report noted the slow-down of non-oil domestic exports and re-exports. Both the manufacturing and commerce sectors suffered lower growth because of external environment. The global economy slowed down. World trade slowed down from 8.5% to only 7%.”
“If only to get rid of the marginal car owner, there are better ways and less costly ways of doing so. Measures like the ERP. What does the ERP actually do? First of all, bear in mind that ERP, if Government adopts it, will take about five years to implement. So it is five years down the road. We need something in between. What does the ERP do? It simply charges you for using certain stretches of roads. What it does to the system of transportation is that it will divert traffic to other roads and instead of congestion in one place, it will be spread out to other roads. So if you can imagine that you allow free car ownership, imagine if you could pack cars bumper to bumper all along expressways, along every road in Singapore, that will be the maximum number of cars you can put on the roads, but they cannot move. So usage measures cannot prevent that kind of congestion. It is the same for ALS. It merely diverts traffic, space-wise and time-wise. You do not believe me, just try to drive into the city area after 7 o'clock and you will see tremendous congestion. We have merely postponed the congestion from about 5 to 7, to from 7 o'clock onwards. And also the ring roads get affected in the meantime. Dr Lee Siew-Choh asked about whether surveys should not be done for some of these measures like ALS. If he had read the Committee's Report carefully, he would have noticed the submission by the PWD which has been monitoring the system. Surveys have been taken and surveys are still being taken. Mr Speaker, Sir, I recommend that Members read the Report in toto and consider our proposals very carefully before they dismiss any of them.”
“The reason why the Committee advocated the PARF was, firstly, to be fair to all the present car owners who were promised the PARF when they bought their new cars, and Government must honour its commitment. Secondly, we recommended PARF even for new cars after the quota is introduced in order to encourage a younger car population on the road. We happen to recommend for new cars a sliding scale from five years onwards. People do not have to scrap their cars. Even now they do not have to scrap their cars after 10 years. They can continue to keep their cars, but there is an incentive for them to scrap if they wanted to. And the people who buy these cars need not scrap them, they can export them if they refurbish them. So I think the matter must be put in perspective. The question of bidding, I believe, that is a matter for the Ministry to sort out how exactly the process is to be done, but it can be done in a very orderly way. People who want to buy cars do not have to actually go and bid. The dealers will do all the job and, I believe, that the dealers between themselves will even out whatever price fluctuations there may be. You simply go to any car dealer and say, "I want to buy a new car." And you have a choice. A scrap car costs so much of this capacity, a quota licence costs this much. Take your pick. And I believe it will be predictable within a month or so, if that is the time within which a quota is allocated. What about usage measures? Some MPs believe that we can rely upon usage measures alone without ownership measures. Well, if you increase usage cost exorbitantly, of course you will limit car ownership at the same time. But you are hitting out at all the 250,000 car owners simultaneously, and to what purpose?”
“But it is a matter of choice and it is quite simple for the Ministry of Communications and Information to engineer the quota to either result in a net increase in prices, stationary prices or even to lower prices. And if I were the Minister I would teach the speculators a lesson by making such a generous quota in the first place and lowering new car prices in the process. The speculation and the windfall gains are already there in the present system. Dr Hong Hai mentioned that some time last year the market was anticipating an increase in ARF and therefore used car prices were going up and scrap car prices were going up. Immediately after the Select Committee tabled its Report earlier this month, the scrap car prices went up in anticipation of a restrictive quota that will raise new car prices subsequently. Windfall gains. I am surprised that some MPs think that owning a car is an investment. It was just a quirk of the market in the last few years because of the Yen and the Mark appreciation that gave a temporary increase or windfall gain to some people who own Mercedes-Benzes and such expensive cars. It was due to the Yen appreciation and the Mark appreciation. But the ARF itself only slows down the rate of depreciation. A car is a depreciating asset. A car is not an investment. So do not rush off to buy a new car in the hope of making a profit. You are more likely to lose than to gain. And you only gain if the exchange rate moves in your favour. What about the objection that the quota system will endow people who get the quota to have a perpetual right to own a car? That is not inherent in the quota. It is inherent in the PARF. Eliminate the PARF and you eliminate this problem altogether.”
“Because if you know these cars, they are rather antiquated in terms of their mechanisms and inferior in terms of their features. The ARF system has led us to substitute poor quality cars for better quality cars on our roads. Secondly, the ARF system is already an implicit quota system, whether one sees it or not, whether one admits it or not, because at the back of the Ministry of Communications and Information's mind, there has to be a limited rate of growth in terms of car ownership and therefore every few years the ARF is adjusted upwards and the market has been expecting this from some time last year. That is why there was all the speculation. Furthermore, the present system has got some very irksome measures which are quite unnecessary, for example, having to increase road taxes and petrol taxes from time to time. A quota system makes it unnecessary to increase road taxes and petrol taxes. In fact, both can be decreased, if necessary or if desired, without increasing car ownership. Will the quota system raise prices? I think that is something at the back of everybody's mind. The answer is yes if the ARF is not lowered and quota holders are required to pay the ARF. If you take the chart presented by Dr Hong Hai, on the left hand side, you will see that the quota holder has to pay the ARF. But the price will only go up if the ARF is not lowered. But he recommended the ARF to be lowered simultaneously when a quota is introduced. That could lead actually to a lowering of new car prices. An alternative to his suggestion is to allow the quota holder to pay PARF rather than ARF. In other words, just like a scrap car owner pays the PARF rather than the ARF, so a quota holder can be allowed to pay PARF rather than ARF.”
“Singapore is a city state. Where is the country side? Where is the hinterland? Where is the open space where we can take our cars for a weekend enjoyment? It is unrealistic to expect that people will buy cars for the purpose of keeping them in the garage, polishing them every so often, admiring them every now and again, purely for the sake of a status symbol. People buy cars to use them. And I am not convinced that improving feeder services, good as the idea is, is going to persuade many car owners to give up using their cars to go to their place of work, for the simple reason that you need not only a feeder service to get to the MRT station but you need a feeder service from the MRT station at the other end to get to your place of work. And more than that, many people need their cars in the course of their daily work to go from one appointment to another. So let us be realistic. We cannot allow car ownership to increase freely without hindrance and hoping that usage measures by themselves alone will achieve the result. Sir, the present system has worked well up to now. But there are inadequacies which are becoming more and more obvious. The first one is that the ARF is based on a percentage basis and the Government would have to keep on increasing this percentage in the future if it hopes to use it as a car ownership restraint measure and this will distort the buyers' preferences even more than it has already. If we look at the car prices, we now have a wide range and what we have seen is a substitution of better quality cars for inferior quality cars. I never thought I would live to see Ladas on the roads of Singapore, or even Skodas. An hon. Member: Why?”
“The question is: will we be able to accommodate a similar rate of growth of all kinds of vehicles in the future without severe congestion? This House has focused on car ownership because that is something which affects a rising proportion of the population, especially the young and upwardly mobile portion of the population, people who reach middle-class status. Sir, the point is that the car is the most convenient form of transportation and, in addition, it is an important status symbol so that with rising incomes more people aspire to own them. But there are at least two implications that arise out of these rising aspirations. No. 1: If we are to accommodate the rising aspirations, more land and more resources must be allocated to roads and to the expansion of roads. It is a social choice that Singaporeans must make. There is a cost to be paid for more roads. Secondly, more congestion will result even if more roads are built. There is always a physical limit to the actual number of cars given the number of roads. Unless, therefore, a rationing measure is introduced, severe congestion will result. Government could, as some Members are advocating, allow car ownership to increase freely without restraint. The result would be severe congestion for everybody. Of course, if the congestion gets severe enough, this in itself will serve to limit the growth of car population. I am always amused when people refer to London or to other big centres like Munich and big cities like New York City and so on, and they try to draw parallels for us, saying, "Look, they can accommodate a lot of car owners without congestion because people leave their cars at home and then commute to work." That sounds very good until one realises that Singapore is not like New York City or London.”
“What we need to do is to look at our land transport in toto. As the Committee looked at what has been done in Singapore in terms of various measures to promote land transport policy, we have been heartened to find that we have provided a very modern system of transportation with various modes available to the public and certainly an outstanding means of transportation via the MRT. It is the total system of transportation that has not only kept pace with our economic development but has also facilitated it. Let us not forget that in a well functioning economy, people and goods must be able to move efficiently in terms of time and cost, and congestion conversely increases the cost to producers and to consumers in terms of both time and cost. At the same time, we have been able to enable more and more people to own their own cars. In fact, the rate of increase in car ownership, as pointed out by Dr Hong Hai, has far exceeded the rate of population growth. We need to keep the total perspective in view, because if we focus only on car ownership and usage measures, we will miss out on what is necessary for our future economic development. There are half a million vehicles on the road and less than half of those are represented by motor cars. The rest are commercial vehicles. We must make room for commercial vehicles. We must devise a system that will enable commercial vehicles to function efficiently in Singapore in addition to cars. And not only commercial vehicles that move goods but commercial vehicles that move people, like buses and the MRT, and commercial vehicles that move both goods and people, like taxis. I think we should pay attention to each one of these categories.”
“Mr Speaker, Sir, I rise to support the motion of Dr Hong Hai. After listening to some of the speakers, particularly the last two, Dr Lee Siew-Choh and Mr Chng Hee Kok, I am just wondering how many Members have read the Report in toto and also how many have even read the recommendations listed in the Report. Or have they merely read the Straits Times or the Lianhe Zaobao? Dr Lee Siew-Choh complained a lot about the congestion in Singapore by cars. He has come a long way from being Chairman of the Barisan Sosialis. I am just wondering if the Barisan had taken power in Singapore and been in power all these years, whether there would be any congestion at all. Would Singapore be like Moscow or one of the Eastern European countries where there are only a few Ladas around and certainly no congestion to speak of? He says it is because of the PAP's successful economic policies and rising incomes. Well, a few years ago, we had a severe recession and it was through the strong efforts of the Government led by the Minister for Trade and Industry that got us out of that recession and we have had very strong growth for the last three or four years. Perhaps, Sir, Dr Lee is asking that the Minister engineer another recession and keep Singapore in a perpetual recession. That is one way to solve the car population problem. Sir, the car ownership problem is one that has certainly generated tremendous emotions in Singaporeans and that is well reflected in this House. It is unfortunate that this is so, because the land transport problem of Singapore is more than just car ownership or even car usage. Even Dr Lee Siew-Choh, a man who is supposed to be a socialist or one-time socialist, spent 99% of his speech on car ownership and usage. He has become very bourgeois indeed.”
“And it is to the credit of the Prime Minister and his colleagues that they have been able to do this successfully and it is to the credit of PAP Backbenchers that we have been able to help in our little way to garner the support necessary for those unpleasant but good and necessary policies. Then, Sir, at the end of the day, the responsibility really lies at the foot of the Frontbench. A lot of burdens have been thrown this way but let me throw the ball back that way. They are the ones who have to formulate policies. They are the ones, the younger ones among them, that have to lead Singapore into the 21st century. It is their leadership which is going to determine whether Singapore makes or breaks and if we, as Backbenchers, can do our part to help in the process, then I think we have a better and more secure Singapore to look forward to. And I believe that the challenges facing Singapore in the years ahead are vastly different from the challenges that faced the Prime Minister and his earlier Cabinet. It is a challenge of affluence. It is a challenge of what to do with the people that already have the basics in terms of housing, in terms of education, in terms of health, in terms of transportation. Are we going to be the very victims of our own success? Or is there enough in the Frontbench of that quality of leadership that can set the sights, raise the vision of the people and rally them to rise above themselves to push ahead to lead Singapore into the 21st century, to make sure that Singapore survives and prosper? That, Sir, at the end of the day, is our common concern, both Frontbench and Backbench. Although, as I said, I do not like the Bill, but I can live with it and, as a good and faithful PAP Backbencher, I shall vote for it. 2.16 pm”
“Or is it rather that whatever the views that are garnered the Government should take adequate note, make changes when necessary? But even more important, we should realise that PAP MPs are not mere representers of views in this House, not mere conveyors of what the people say. But the PAP MPs ought to be leaders of opinion. We should be there in the forefront if we believe that something is right. We should convey our ideas to the public. I believe that is what leadership is all about, not to be pushed from the ground, but to lead the ground in many areas. I believe another vital and important role for PAP MPs is that once the Government has formulated a policy, we should all rally around that policy and rally the people in support of the policy. I have been here for 20 years. I have seen this process work over the years. I have seen how hard my colleagues and I have worked in, order to persuade people to accept policies which have a bitter taste to it, policies which are unpopular, policies which the public may think are the wrong policies, but in the end turn out to be productive, fruitful and constructive for Singapore. My younger colleagues would do well to try and look at the history of the PAP Government to understand that this is a government unlike many other governments. It is not a government that is pushed along by public opinion. It is not a government that takes a short-term view. It is not a government that plays to sectarian interests. It is a government that has tried to do its best for Singapore by taking the long-term view and by taking the national view. But that means courting unpopularity at certain times.”
“Let us not forget that the role of PAP MPs extends beyond Parliament itself, that in the Party caucuses our voices are heard, our views strongly expressed and often times I believe the Government has taken note and incorporated our views in the formulation of Bills and in the formulation of policies. And I believe that my colleagues have not been afraid to speak up in this House. I have been here nearly 20 years. I have never felt any constraint in speaking on any subject. The only constraint was my own conscience. There was never a time when a Minister or the Prime Minister told me I was not to raise this issue or that issue. I believe my independence as an MP has never been questioned by members of the public. And I believe that that is the same for my other colleagues in Parliament. But we should ask ourselves: what is the real issue that we are dealing with? And I believe the First Deputy Prime Minister raised a question which the Prime Minister raised, I believe, on the morning of the 1984 elections, namely, the possibility that at some future elections, there could be a nightmarish result, a disparate coalition of Opposition parties, unqualified, ill-prepared for office, suddenly have the majority number of seats in Parliament, for the simple reason that Singapore, as the First Deputy Prime Minister said, is really one single constituency. The ways various constituencies are structured, issues affect all constituencies without exception. Having said this, and having acknowledged the problem, what is the real solution? Is it to try and get more views represented in Parliament, more people, apolitical people, non-partisan people to come into Parliament to express their views?”
“Mr Speaker, Sir, let me state at the outset that I do not like the Bill, but I can live with it. The imposition of the Party Whip is not something that Backbenchers like but I believe it is a small price to pay for political stability. Members who are new to this House might want to study the history of why the Party has imposed discipline over the years, because there was a time where MPs crossed the floor and created instability in Singapore. In fact, the Government nearly lost out in this House. In this debate, Sir, unfortunately, those who have spoken in favour of the Bill have done so with no real conviction. They do not convey a sense of passion for the Bill. There were a few who did simulate some passion. But you can see plainly it is simulated passion. Whereas those who spoke against the Bill did so expressing strong convictions, strong passions. I think if we put those together you can gauge what is inside the hearts of PAP MPs. As for the Opposition MPs, only one of them is here, I think the Bill makes them feel threatened. And Mr Chiam See Tong rose up earlier asking whether he has any place in this Parliament after all. He obviously has been made to feel insecure. One can understand the reasons why. Because if the Opposition MPs have not been able to represent the views of their electorate, the views of Singaporeans, if they feel that they cannot cope with many Bills because they just do not understand enough of the subject matter, then they have a right to feel insecure and threatened. As for my colleagues, the PAP MPs, I believe that there has been no lack of serious representation in this House of important views, of relevant views on whatever issues and I believe that we have been fairly representative.”
“We must have confidence that in the end, as Singaporeans, we know what is overall best for ourselves. We are a community of free citizens committed to making Singapore a great city to live in and for foreigners to come visit and admire. I cannot believe that a council of upright citizens charged with that responsibility will not confront the alternatives squarely and recommend the right policy for Singaporeans to follow. It may not work in other democracies, but it will in ours, if for no other reason than the fact that we have so few choices before us.”
“I oppose the proposed amendment and the amendments to the amendment because they give the impression that the Government and the officers of the Ministry have not been thorough in their search for the optimal solution. Mr Speaker, Sir, there is nothing wrong in criticizing Government policies, of course. In a democracy, we not only have the right to criticize, we have a duty to when we feel that something is not right. But, having sat in on several briefings given by officers from the Ministry and read many of the papers written by them, I must say they have done their homework very carefully. We may disagree with some of their judgments, as honest men would. But we cannot fault them for not being diligent. If there is a better idea, they are the first to adopt that idea as their own. Because transportation policy is so complicated and so contentious by its very nature, I recommend that we form a national advisory council with representatives from all affected sectors, similar to the structure of the National Wages Council. The job of the council will be to receive representations from members of the public and advise the Government at regular intervals, and with expert help if necessary. By broadening participation, we ensure that we do what is best within what is possible. I recommend the formation of an advisory council as an exceptional departure from representative government. In a democracy, the government is elected to govern and it should not lightly pass the buck. Transportation policy is an exception because it affects all our lives everyday and every effort must be made to find the ideal solution. Is there a danger that when faced with constant public criticism, the advisory council will buckle under and recommend traffic jams instead? I think not.”
“Yes. There is a question of taxes that may be forgone in the process. And he has access to the Minister. He can feed the Minister with all kinds of suggestions. So NTUC Comfort taxi drivers are very well taken care of, despite what the General Manager said. The Minister of State for Finance and Foreign Affairs (BG George Yong-Boon Yeo): Mr Speaker, Sir, I neither support the amendment nor the amendments to the amendment because they suggest that the proposals to keep our roads free of congestion were arrived at without a careful consideration of all points of views. We all know that there are no pleasant solutions. If there were, they would have been found and implemented a long time ago. Both the Economist and the BBC praised Singapore recently for having overcome the problem of traffic jams. But neither the Economist nor the BBC explained the price paid by Singaporeans for this achievement, has not explained the hardship it has caused to all of us. It is a heavy price because, all said and done, the only way to solve the problem of congestion is to curb ownership and usage of cars by higher price and greater inconvenience. Because the alternatives are all painful, we have to question the Government continuously to make sure that the policies we settle on are the least painful ones possible. And Government must listen and listen carefully, because there may be ideas not yet considered, possibilities not yet explored, consequences not fully anticipated. But it is not easy to criticize in a very constructive way because there simply are no painless alternatives.”
“There is such a thing as initiative. Who initiated the project? What was the objective of the project? And there is such a thing as economies of scale, the benefits of which are passed on to the taxi drivers. Let us not forget those elements. An hon. Member: They do not pay tax on their income.”
“May I respond to that, Mr Speaker, Sir? I am very surprised because he is the General Manager of Comfort.”
“We should put it in the positive. The objective is to build an efficient, affordable transportation system, and transportation is the lifeblood of this nation - air transport, sea transport, land transport). We must be able to move people, we must be able to move goods cheaply, efficiently. That is our objective. What proposals do we have to make this objective realisable? Yes, there are problems with the evening ALS that is being proposed, people who live there and have to go back after work. If this has been overlooked, will the Minister please take a second look? Yes, the car park fee may be a little too onerous for the people who are in the lower-income group. It affects their cost of living. Is the rate of increase justified? Does it help to improve the transportation system? If not, can it be lowered? And the motorcyclists. I understand the number of new registrations has actually gone down. So why increase it? These are some of the the questions which are being asked. They are legitimate questions. They can be reviewed. They ought to be reviewed. Finally, Sir, just a word on the conflict between equity and efficiency. I believe we have reached a point in our economic development where people are becoming more conscious of equity considerations. But we can go overboard and throw out efficiency altogether. I think the secret is to strike a balance between equity and efficiency. We have got to keep the vehicles moving, reasonably well, on our roads at a price that will not hurt our economy.”
“It is clean, it is efficient, it gets people to work very fast. And we take it for granted. Nobody says a "thank you" to the Minister. There are two Ministers involved - Mr Ong Teng Cheong who started it and our present Minister, Dr Yeo Ning Hong. Nobody knows the sweat, the toil, behind the MRT. It is not easy to oversee a huge expensive project like that. You know, when taxes are raised, emotions are high. It is not easy for people to be reasonable, to be rational. But my plea to the people of Singapore is: Come, let us reason together, let us see whether the objectives, the principles are worth supporting, and then let us see whether we can talk to the Minister and his officials and the Cabinet to see whether we might moderate some of the policies. If indeed they are not effective, if indeed they are too onerous, I believe things can be changed. I believe flexibility is in the lexicon of the Minister. And let us put up counter-proposals. Everybody says, "Scrap this, and scrap that." But what do we put in place? Do we have a better system? Do we want the system to run to ground? Do we want traffic congestion and chaos as in Bangkok, Tokyo, and New York City, in London, in the major cities of the world? You talk about the cost of transportation rising. Do you want such congestion that to get from point A to point B, one kilometre distance, takes you an hour? What kind of costs will they build into the system? When we have a system that works, let us try to improve upon it. Let us not try to shoot down things which work. And if the additional measures are not suitable, let us change them, let us modify them. But let us keep in view the objectives, the principles of the road transport policy. Unfortunately, we put it in the negative - to prevent road congestion.”
“He has got to find all kinds of under-hand methods, surreptitious means in order to make up the budget deficit. America is still in very serious debt today, and the debt is growing, because the government cannot raise enough taxes to finance the expenditures. Sir, we are blessed with prudent financial policies. Dr Hong Hai mentioned the $5 billion that was spent on MRT. But nobody asked the question, where did the $5 billion come from? We did not have to borrow that money. Government had the money because of financial prudence. It was a colossal subsidy to the MRT system and more than that, the MRT was built below anticipated cost, ahead of schedule. Compare our project with many projects abroad, some of them are still building when they began 10 years ago, 15 years ago. A lot of road congestion, escalating costs, government selling to borrow, inflation occurring in the economy. Dr Lee talks about inflation. What does he know about inflation? He lives in a country where his dollar is very well protected, where the exchange rate keeps on rising from time to time. And when we travel abroad, we feel richer; and more people are travelling abroad. And that is my evidence - that we are much better off. Look at the houses that we have, the space that we have, the parks that we have. We must not be an ungrateful people. What about taxis? Again, the Minister took a lot of flak for the taxi policies. Which country in the world subsidizes taxi-drivers to allow them to buy their taxis at very low rate of interest and easy methods of payment, with all kinds of insurance schemes, scholarships for their students, everything thrown in? If this is not compassionate government, what is? If this is not subsidy, what is? Tell me. Where do you find $5 billion to subsidize an MRT?”
“Mr Speaker, Sir, there are so many amendments that I had better make my position clear before I begin speaking. I support the motion by Dr Hong Hai and I support the amendment by Mr Ng Pock Too. I consider the amendment by Dr Arthur Beng as one that could be improved upon considerably, and I totally reject Dr Lee Siew-Choh's amendment as inconsistent, mischievous and completely wild. Mr Speaker, Sir, all MPs want Ministers to listen to them. But I think this is one instance where the Minister took MPs too seriously. I have been privy to some of the conversations at lunch time during which various proposals and counter-proposals were made to the Minister for Communications. And I distinctly remember many of my colleagues on this side of the House telling the Minister that he should not increase car registration taxes but instead should increase user charges, and he took them seriously, and here's the package, and everybody is howling. My advice to the Minister is in future, don't be too ready to listen to MPs, because they are not the ones implementing the policies. He is the one implementing the policies and he has to face the heat. At times like this, Mr Speaker, Sir, the Ministers deserve their pay increases. Mr Speaker, Sir, taxes are always unpopular. And the more people that are affected by the same taxes, the more unpopular these taxes are. Recall, Sir, the American general election last November where President Bush, the candidate for the Republican party, did not even dare to say that he was going to increase any taxes. In fact, he went out of his way to assure people that there would be no new taxes. And now he is in a bind, because he cannot put right the budget deficit which is growing because he has got no means to increase revenue.”
“They can still enjoy the seafood regardless of the indigestion. They can do the shopping and do other things in Johor Baru. I believe that what is important for us is that we do not preclude ourselves the option of setting our own national policies. One may agree or disagree with the petrol price increase to curb the use of motor vehicles in Singapore. But if that is deemed to be necessary, then it would be logical to have such a Bill to ensure that should such a tax increase come, then there will be no real congestion at the Causeway and real and very serious loss of revenue consequent upon that.”
“Mr Speaker, Sir, we can speculate about how effective this Bill will be. But it appears to have caused Dr Lee Siew-Choh a lot of indigestion already. I do not know whether indigestion leads to fantasy, but I do know that if one proceeds on certain assumptions about the behaviour of the Government, one can certainly fantasise about all kinds of motivations and ill-effects of policies and I can see why it is so easy for Dr Lee then to assume that the Government is stupid, inconsistent, schizophrenic, illogical, and so on and so forth. I believe, Sir, it is safer, easier and saner to assume a rational Government. If one proceeds on that basis then let me suggest a hypothesis why this Bill is being presented to Parliament. If the $2 million loss of revenue per month is acknowledged by everybody to be a small amount, then surely that loss by itself cannot be the real reason for the introduction of this Bill. But if one can look further down the road and see a further strengthening of the Singapore dollar vis-a-vis the Malaysian dollar or an increase in petrol tax in Singapore, then one can see why such a Bill might be put into effect. I think the Minister hinted at this when he referred to the earlier experience when we did put on too big a petrol tax and the price differential between Singapore petrol and Malaysian petrol was so large that it led to long queues at the Causeway. So I do not believe that the intention of the Bill right now is to prevent people from going to Johor Baru because all the other attractions of Johor Baru are still there. It is still possible for motorists to go across the Causeway even with slightly more than half a tank and fill up there and refill there many times as long as they are motoring throughout West Malaysia.”
“But, Sir, it was not his Party at that time.”
“But, Sir, he claimed that his Party objected at that time. So it appears that he is telling a lie.”