Lee Yock Suan
Singapore
“The position will be clear when the regulations have been drafted. Right now we are debating it in the absence of actual wording of the regulations. The regulations will be fair, they are meant to maintain a level playing field, and we should wait for the regulations before we pass judgement. The intention is not to go after everybody.”
“I think the Member will be aware that Internet is a very dangerous place. We can have all kinds of poison letters and they will just spread like wild fire. So we must have some means to try and minimise this and make sure that everything is orderly and fair.”
“The other Members have no problem supporting the Bill, including Mr Chiam. I think the position is about 95% clear. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. - [Mr Lee Yock Suan].”
“Then we will have to see the actual situation. But, as I said, the intention is to go after the popular sites, the main sites of parties and non-party political sites. If it is an individual, eg, a young man posting up his own site and saying "These are my views", we are not going to go after those people.”
“The intention is to make the rules clear for the main parties involved in the contest, in other words, the party websites. These are the areas we are mainly after.”
“I thank Mr Chiam for reminding me about his question. On listening to his speech, I was under the impression that he was asking whether this ban on opinion polls applies to the mass media. The answer is yes, it applies to all media, not just the Internet but also newspapers, TV and so on. Thank you for pointing this out.”
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“Mr Speaker, Sir, I am not sure whether the Member is referring to another question which is coming up at another sitting of Parliament. If so, I will answer it in due course.”
“Mr Speaker, Sir, I think I should make clear that the fact that the Government has made this decision does not in any way imply that the economy is at rock bottom, not by a long shot. The fact is that the Government has reviewed thoroughly all the various possible measures that can be taken, some of which like the reduction of rates and charges have already been taken. The Economic Committee will be completing its report shortly and there will be other measures recommended. The conclusion after all these studies is that it is best to cut the rates now on a temporary basis. In the process we will then compress the period of recovery and speed up the process by stimulating the economy to recover as soon as possible. It does not make sense to wait until the market forces work their way through. So it is in that context that we should see this cut. 12.00 noon”
“Other HDB buyers who may have difficulty paying additional cash could apply to the HDB to have their housing loan periods extended. Similarly for buyers of private properties, Credit POSB and other financial institutions will be asked to lengthen their loan periods if necessary. Those who have more than $15,000 in their Medisave Accounts will be able to make use of the excess CPF savings, when it is channelled to their Ordinary Accounts, for servicing their housing loans. The Government is also considering to move the CPF interest rate towards the market rate. This will be in line with our policy to allow CPF members greater flexibility in investing their CPF savings. The HDB mortgage rate will be reduced correspondingly and this will help to ease the burden on the HDB home buyers.”
“Sir, I think I have already included that point in my answer - that I have drawn a line somewhere. These legal costs have been included because they are connected with the purchase, and that's it. I will not make further changes unless there are fundamental reasons for doing so. CENTRAL PROVIDENT FUND (Reduction of rate of contribution) 9. Mr Lau Ping Sum asked the Acting Minister for Labour whether the Central Provident Fund rate of contribution will be reduced; and, if so, to what extent such a reduction will affect those under the Home Ownership Scheme. Mr Lee Yock Suan: Mr Speaker, Sir, the Government has decided in principle to reduce the rate of contribution to the Central Provident Fund for several years. This temporary measure will assist the economy to recover and preserve jobs. The CPF rate will be restored after the economy has recovered from the current recession. The details of the temporary cut in the CPF rate of contribution are being finalized. As the main intention is to reduce wage cost to regain our international competitiveness, the employer's rate of contribution to CPF must be reduced. It is also likely that the Special Account will be suspended so that the 4% contribution can go to the Ordinary Account for use in servicing housing loans. Studies indicate that most CPF members will not have difficulties servicing their housing loans if the cut in the employer's rate of CPF contribution is not too large. A consequence will be that there will be more members whose monthly CPF contributions will be less than their HDB loan instalments. However, a large majority of the additional members affected in this group will have CPF balances which will be sufficient to make up the shortfall for several years.”
“My basic point is this: we have to draw a line somewhere, and I have drawn the line at purchase because otherwise there will be no end to this issue. I would rather that my Ministry review the whole issue of CPF thoroughly and fundamentally, and only make fundamental changes if necessary, rather than allowing small changes to nibble away at the scheme; because by so doing, we may lose sight of the basic objective of the CPF scheme which is to provide for the old age financial security of members. Our studies have shown that even expenses which appear relatively minor, coming at the front-end of the CPF scheme, tend to have a significant impact on the old age savings.”
“Mr Speaker, Sir, I think it is a matter of opinion whether these expenses are consumptive in nature or of an investment nature.”
“Chandra Das asked the Minister for National Development (a) when the proposed pedestrian overhead bridge between Street 41 and Street 43 in Ang Mo Kio Avenue 10 will be ready; and (b) what will be its cost.”
“The view of my Ministry is that no company should force its employees to accept early retirement. However, employees may agree to accept early retirement. In the case of Jurong Shipyard, workers were offered benefits as specified in the Collective Agreement if they agreed to retire early to help the company cope with the downturn in the shipbuilding and repairing industry. A total of 275 workers took up the offer and collected the benefits provided under the scheme. Shortly after accepting the offer, some of the workers approached my Ministry for assistance alleging that they were forced to accept early retirement. They also wanted to claim extra benefits. My Ministry took up the matter with the Management and was informed that the union and the workers had agreed to the early retirement scheme. As the Management had given the assurance that the scheme was voluntary, my Ministry and the NTUC requested them to accept any worker who wished to return to the Shipyard without any break in service. The Management agreed to do so provided that the worker refunded the retirement benefit and other payments which he had collected under the scheme. 18 workers have since refunded the benefits they received and returned to work. Some other workers insisted on being allowed to return to work without having to pay back the retirement benefit and other payments they had received. This the Management could not accept. It is not true that only Singaporean workers were involved in this scheme. The company had 139 Malaysian workers of whom 10 accepted early retirement. The company has over the past 3 years almost halved its foreign workforce through resignations and non-renewal of work permits when they expired. ANG MO KIO AVENUE 10 (Pedestrian Overhead Bridge) 3. Mr S.”
“Presently, the CPF Board issues statements of accounts to CPF members in January every year. From next year, the CPF Board will issue an additional statement to members in July. Two statements a year should meet the requirements of the majority of members. Those who need more frequent statements can at anytime obtain them from the Board's main and branch offices. The CPF Board is looking into the Member's suggestion that the statements provide more details to facilitate verification. JURONG SHIPYARD (Early Retirement of Selected Employees) 2. Mr J.B. Jeyaretnam asked the Acting Minister for Labour how his Ministry views the practice by some companies to force early retirement on selected employees and if he will make a statement in particular on the exercise carried out by Jurong Shipyard noting especially the fact that all the selected employees were Singapore citizens and the Malaysian employees were left untouched.”
“The Handicaps Welfare Association has set up a Vocational Assessment and Placement Centre and a centralised job placement service with the support of the Ministry of Community Development and the Singapore Council of Social Services. ORAL ANSWERS TO QUESTIONS NOT REACHED BY 12.00 noon CPF STATEMENTS OF ACCOUNTS (Details) 1. Mr Lau Ping Sum asked the Acting Minister for Labour whether the statements of accounts for Central Provident Fund contributors can be printed more frequently and show details such as the amount and date of contributions and deductions to facilitate verification.”
“As stated in Miscellaneous Paper No. 5 of 1985 presented to Parliament on 1 August 1985, the Government has decided not to ratify or adopt the Vocational Rehabilitation and Employment (Disabled Persons) Convention, 1983 (No. 159) and the Vocational Rehabilitation and Employment (Disabled Persons) Recommendation, 1983 (No. 168) for the following reasons: (i) Employment of the disabled is best left to market forces and enlightened employers rather than enforced through legislation. (ii) With the tight labour market, disabled persons have been able to secure suitable employment after appropriate training. Each country is run differently depending on its people, resources and state of development. It is not appropriate to adopt in total conventions drafted to meet the standards of more advanced Western countries. Singapore has its own programmes for the vocational rehabilitation and employment of disabled persons. Thus the Disablement Resettlement Scheme of the Ministry of Labour assists persons disabled by industrial accidents to undergo vocational rehabilitation for the purpose of gainful employment. Under this Scheme, disabled persons are helped in securing on-the-job training in light industrial establishments as well as in sheltered workshops run by voluntary organisations. The Ministry of Community Development administers an Incentive Scheme funded by the Singapore Chinese Chamber of Commerce and Industry to help disabled people to gain employment. Under the Scheme, the employer is reimbursed for the first 1 month's salary paid by him to the disabled employee. The Scheme also provides a transport and meal allowance of $5/- for the disabled employee during the first two weeks of his employment or until he receives his first salary payment.”
“All I can say is to ask the Member to be patient. ADJOURNMENT TO A DATE TO BE FIXED (Motion) Resolved, That at its rising today Parliament do stand adjourned to a date to be fixed. - [Mr S. Dhanabalan]. ADJOURNMENT MOTION”
“Mr Speaker, Sir, may I correct the point? I have not said that CPF will be allowed for education. That is something which has still got to be decided by Cabinet. But my Ministry is doing a study to review the whole question of CPF, and we hope to complete our study by next year.”
“Mr Speaker, Sir, if Members had listened carefully, they would have realized that the 10% was because we do not want to overheat the stock market. It is not related to the ability of CPF to provide the money. I said so before, that even if all the members were to be allowed tomorrow to withdraw their CPF money entirely, there will be enough money to pay. There is no doubt about that. As to when this limit of 100% of investable CPF savings will be reached, I can remind Members that, in fact, CPF members are now allowed to use 100% of their Ordinary Account savings for properties, either residential or commercial. So as far as properties are concerned, we have already reached the limit, but for shares, gold and other instruments, we are approaching it cautiously to see how the market reacts, whether there are any problems to the scheme, and we will liberalize as we go along. It is difficult to put a time-frame on this.”
“Mr Speaker, Sir, that is not the intention of this scheme. The intention is to allow CPF members greater flexibility to manage their own savings. If they feel that they are better-off leaving their money with CPF, we will be most happy.”
“Sir, this is up to the Stock Exchange and the brokers concerned.”
“I take note of the Member's point and we will look into it. Dr Wang Kai Yuen (Bukit Timah): Mr Speaker, Sir, would members making use of the CPF fund to buy stocks be able to enjoy a preferential brokerage rate, rather than the usual brokerage rate? Maj Fong Sip Chee: You are asking too much!”
“I am sorry, Sir, I do not understand the question.”
“Mr Speaker, Sir, I think that is a very good question. Now, we have to strike a balance here. The objective of the Government is to allow members maximum flexibility and choice. We do not want to limit them to any particular stocks because we do not favour any particular stocks. So the conditions that we have laid out are really the minimum conditions. To qualify as a trustee stock, all that the company needs to have is just $5 million paid-up capital, which is not big by today's standards, and also to have paid dividends over the past five years. So members should really be very careful. It does not mean that trustee shares are safe shares. Members should really look at the future profit projections of the company. A company might have made money over the past five years but it may not be making money in the future. So they should go in with their eyes open. But I think the question, as I said, is how to draw a balance, which class of shares? What we are doing here is just to provide a minimum level of protection, beyond which we will be, in fact, investing the money for members, which will not be desirable. So I want to emphasize the point that members should go in with their eyes open, and they have to accept the consequences of their investment decisions. Maj Fong Sip Chee: Mr Speaker, Sir, I am afraid the Minister has not answered my question. May I just repeat. Will the Minister agree that the very provision that he has just announced will benefit those people who have already got substantial shares in their hands but, at the same time, denying those people who are prudent enough not to indulge in shares of a chance to acquire extra funds for the ---”
“Would it not be more prudent to define such companies as those which have been able to make a certain amount of profits, probably defined as a certain percentage of return on capital, rather than to use the criterion of having paid-up dividends continuously for five years?”
“May I request Members not to be personal in their remarks. But I will just answer the question. We have estimated that, based on this requirement of a minimum reserve of $30,000, about 300,000 members will be able to take part in the scheme. That is quite a large number of people. In fact, we feel that those people who have lower CPF savings should really save carefully and hold the money with the CPF, where it is safe and which pays a guaranteed return of 6 1/2% interest at present, before they venture out into more risky areas. Because when you invest in stocks and shares, and gold, you may make or you may lose. It is up to your judgment and good fortune. In fact, as for the poorer members, the majority of them are already using their CPF for housing. You know, more than half a million people now have their own homes. So these people have benefited from the CPF scheme, and they will further benefit from this scheme if they save enough. So it is erroneous to say that the CPF scheme is only meant for the richer members. Mr Tan Soo Khoon (Alexandra): Sir, may I ask a question? I agree with the Minister that investment of CPF funds in shares entails a high degree of risk on the part of the CPF member. I would therefore like to ask him about the criteria for companies qualifying as trustee shares companies. He has stated that this will be companies which have been able to declare dividends for the past five years. In view of the fact that there are companies who do not perform well but continue to declare dividends, does he not think that such a criterion would not be so prudent?”
“Mr Speaker, Sir, I do not know whether the Member was asking a question or expressing his opinion on the subject. Maj Fong Sip Chee: I asked the question with a proper question mark behind the sentence. If the Minister cannot understand, he should not be in this place.”
“Would the Minister therefore agree that this provision will benefit those richer members but depriving the poorer members of the CPF, who are still faced with problems of finding money for their children's education?”
“Mr Speaker, Sir, this question of using CPF for education was raised at the last sitting of Parliament, and I take it that Members are very keen to have CPF savings released for education. I assured Members at that time that the committee in my Ministry, which is looking into the overall issue of CPF, will also look into the use of CPF for education. It so happens that we have finalized the scheme for shares and gold at this point, and so I have announced the scheme. But we are still looking into the use of CPF for education. Maj Fong Sip Chee (Kampong Chai Chee): Mr Speaker, Sir, in fact, the answer to the question asked by the Member for Chua Chu Kang has some relationship. I would like to ask the Minister if he will agree that the implementation of this rule will benefit the richer CPF members. By that I mean, Mr Speaker, Sir, the higher income members of the CPF. Would the Minister agree that this scheme will benefit those richer members of the CPF who have already acquired a certain amount, or even a substantial amount, of shares in their hands? And in advantage of this scheme, they could easily dispose of their existing shares, say, $100,000, and use their CPF savings of $100,000 to acquire the shares, and so use that money for their children's education. Therefore, Mr Speaker, Sir, I ask the Minister whether he will agree that those CPF members, who do not have existing shares or stocks in their hands, would not be able to use this advantage, quite legal and perfectly in order, to circumvent the CPF rules by taking out the money, quite justifiably, to use for their children's education?”
“Mr Speaker, Sir, this scheme is a clear demonstration that the Government and the CPF Board have more than adequate resources to pay all the CPF members. The fact that we have been liberalizing the CPF scheme to allow more and more money to be taken out for purchase of private residential properties, commercial properties, and now shares and gold and, in future, other schemes, means that we have the money already available. So Members need not be worried about this. In fact, I would be surprised if the Members for Anson and Potong Pasir were not happy to make use of the scheme themselves and withdraw the CPF savings that they have. As I have explained before in this House, the Government has carefully invested the CPF savings in sound investments. I do not know whether the Member for Potong Pasir is able to read accounts or he is unwilling to accept the facts. If he understands accounts, he will realize that over the last few years the Government has been generating healthy surpluses, so much so that the CPF savings are saved up and invested in sound assets. When the need arises to repay members, there will be more than enough money to pay all the members. In fact, our reserves are more than the sum total of the CPF savings. So the CPF Board is, in fact, the strongest bank you can find.”
“CPF members who decide to take advantage of the scheme should do so carefully, as investments in stocks, shares and gold carry both opportunities of capital gains and risks of capital loss. With CPF members investing under the scheme, it is expected that the number of small investors will increase. They will benefit from sound advice on investment. Banks and other financial institutions will be encouraged to develop the capacity to provide such services for a fee. Investment in Gold Details of the investment scheme for gold are being finalized and will be announced within the next two months.”
“CPF members will be allowed to use their investable CPF savings up to the initial limit of 10% to pay for the full price of the Singapore trustee shares, related convertible loan stocks and unit trusts, as well as the brokerage, administrative and other charges incurred. If they already own such stocks, they can use their investable CPF savings up to the approved limit to re-finance these assets. Where the available CPF funds are insufficient, they can top up with cash. Members will be allowed to trade freely in the shares, convertible loan stocks and unit trusts under the scheme. However, as the scheme is to enable members to invest but not to speculate in the stock market, there will be administrative guidelines to prevent the use of CPF monies for speculation and trading on margins. These guidelines will be formulated so as not to hinder the flexibility required for non-speculative investments. As this is a scheme to enable CPF members to manage the investment of their old-age savings, all gains derived from CPF funds must be kept in the CPF accounts. Dividends received (net of corporate tax) must be returned to the member's account. Upon the sale of the shares, loan stocks and unit trusts purchased under the scheme, the amount realized from the use of CPF funds, including any capital gain, must also be returned to the CPF accounts. However, members will not be required to make good trading losses or to reimburse the CPF interest forgone. Any cash top-up and related earnings will be returned to the member. Implementation of the Scheme The scheme will come into operation after the Central Provident Fund Act has been amended and the operational Regulations drawn up.”
“Unit Trusts Investable CPF savings can also be used for investment in unit trusts. Unit trusts will similarly have to apply to SIC to be considered for inclusion in the scheme. The CPF savings invested through unit trusts can only be invested in shares or convertible loan stocks which are included under the scheme. Limits for investing in shares, loan stocks and unit trusts Of the 308 companies listed on the local stock exchange, 59 are trustee shares of Singapore-incorporated companies. Their total market capitalization is about $20 billion. Their turnover last year is estimated at about S$2.5 billion. To avoid artificially inflating the stock prices, the liberalization of CPF savings for such investments will be done gradually. For a start, members will be allowed to invest up to 10% of their investable CPF savings under the scheme. The intention is to gradually allow the limit to go up, subject to evaluation of the scheme. It is estimated that initially up to about S$1 billion, or S$1,000 million, will thus be made available for investment under this scheme. It can be used for the purchase of qualifying stocks from the local stock market as well as for re-financing of such stocks already purchased. To provide hon. Members with a better picture of how the investment limits will be applied, I will ask the Clerk of Parliament to distribute a paper (Cols. 649 - 652) which contains three examples for Members' information. If Members have any questions on the examples, I will be happy to answer them afterwards. paper - USE OF CPF SAVINGS FOR INVESTMENT IN SHARES, LOAN STOCKS AND UNIT TRUST (Cols. 649 - 652) Trading in shares, loan stocks and unit trusts I now turn to some other details of the investment scheme.”
“They can only use amounts in their Ordinary Account for this purpose. The ultimate intention is to allow CPF members maximum discretion in the way they deploy their investable CPF savings, subject to minimum essential safeguards. Type of shares and loan stocks Let me outline the salient features of the scheme for investment in shares, loan stocks and unit trusts. It is desirable that members be allowed to choose from as wide a variety of stocks as possible, exercising their own judgment and discretion. However, as many CPF members may be investing in the stock market for the first time, certain minimum standards should be set. Investable CPF savings will only be permitted for investment in shares which satisfy the minimum conditions laid down under the Trustees Act and are listed in the Stock Exchange of Singapore. I will refer to them as trustee shares. These conditions include a minimum paid-up capital of S$5 million and require the companies to have paid dividends for each of the last five years. Investment in the convertible loan stocks of companies whose shares are classified as trustee shares will also be allowed. Other companies with good track records but whose shares do not meet the conditions to be classified as trustee shares can apply to the Securities Industry Council (SIC) which will be asked to assess their applications for inclusion under the scheme. Those companies that are seeking listing for the first time can likewise apply to SIC for consideration. As the liability of CPF funds is wholly in Singapore, the scheme will be confined to stocks of Singapore-incorporated companies. This is similar to the present situation where CPF funds can only be invested in properties located in Singapore.”
“Mr Speaker, Sir, the basic objective of the Central Provident Fund (CPF) is to provide for the old-age financial security of our citizens and for contingencies. CPF savings also help to achieve our goal of a 100% home ownership society as well as to meet hospitalization expenses. Whilst maintaining the high savings rate through the CPF, members can be given the flexibility to manage their own CPF savings. Once they have saved a minimum reserve for old age and contingencies, they can be allowed the option to invest their CPF funds in excess of this minimum reserve in other types of investment. The Government has therefore approved the setting up of a scheme to allow CPF members to invest a portion of their Ordinary Account savings in shares, loan stocks, unit trusts and gold. Savings which can be used for such investments A CPF member should have at least a minimum reserve of $30,000 in his CPF Ordinary and Special Accounts before the excess balance in his Ordinary Account will be allowed for such investments. The minimum reserve of $30,000 will include CPF amounts which have been invested in a home. It does not include the Medisave Account which is meant for hospitalization expenses. This reserve of $30,000 is estimated to be the amount necessary for an individual to meet his barest living expenses after retirement. The minimum reserve of $30,000 will be adjusted periodically for inflation. Above the reserve of $30,000, the excess balance which can be used for investment will be termed "Investable CPF Savings". For a start, members will be allowed to invest up to 10% of their investable CPF savings in the local stock market or in gold. There will be a sub-limit of 5% on the amount which can be invested in gold.”
“Mr Speaker, Sir, the situation varies from case to case. The vacancies that we have in the Employment Service Department cover a wide range of jobs. For example, they vary from professional and technical workers, all the way down to clerical, sales, service, and production workers. But it is true that in this period many retrenched workers, have to make an adjustment to their pay expectations.”
“Sir, what my Ministry does is to offer assistance to retrenched workers. But I can give some information to show that the situation, in fact, is not so bad. For example, in the third quarter of this year, my Ministry offered employment assistance to about 2,000 retrenched workers, including older ones. 533 of them came to my Department. This means that about 70% did not even bother to respond. And of the number who were referred to jobs, 34% did not attend job interviews. This seems to suggest that people are still able to find their own jobs and do not need assistance from my Department. But if they need assistance or if they have trouble in finding jobs, they can come to my Department and we will try our best to help them find jobs. What my Ministry can do is to refer them to employers who have vacancies. But it is up to the job seeker to make the adjustments and show to the employer that it is worth his while to employ him. We, of course, try to counsel the older workers about their job expectations.”
“Ownership of subsidised Housing and Development Board flats is a privilege. Only Singapore citizens aged 21 and above who have an appropriate family nucleus comprising at least one other citizen or permanent resident, can apply to purchase HDB flats. The adult citizen or permanent resident members of the family nucleus can apply to become co-owners of the flats. Only the owner and co-owner are allowed to use their Central Provident Fund savings to pay for the HDB flat. Non-citizens who are not permanent residents cannot become co-owners of HDB flats. They have no rights to the flats and are therefore not allowed to use their CPF savings to pay for the flats even if these are owned by their citizen spouses. In the event the flats are sold, only the owners and co-owners would have legal rights to the sales proceeds. There is no plan to allow such non-citizen spouses of Singaporeans to use their CPF contributions to pay for their HDB flats.”
“47 am Resolved, That at its rising today, Parliament do stand adjourned to Saturday, 31st August, 1985. - [Mr S. Dhanabalan.). REQUISITION OF RESOURCES BILL (As reported from Select Committee) Order for Third Reading read.”
“Mr Deputy Speaker, Sir, the Government's decision to allow CPF members to withdraw up to 100% of their ordinary account balances under the Approved Residential Properties Scheme (ARPS) has enabled those who purchased properties under the scheme to reduce their quantum of loans from commercial banks. However, it is still necessary to restrict the total amount withdrawn for any one property to 80% of the value of the property at the time of purchase. This 80% limit was imposed to ensure that, should the market price of the property fall, the CPF money will be safeguarded. This is the same prudent limit which financial institutions apply when extending loans for residential properties. Considering that property prices have fallen substantially over the last few years, it does not appear prudent to raise the limit from 80% to 100% of the value of the property. As regards the second part of the question, properties purchased under the ARPS Scheme are excluded from the CPF Home Protection Insurance Scheme (HPIS) for two reasons: (a) As there is no ceiling to the value of private residential properties, claims could amount to more than $500,000 for each case, many times larger than that of HDB properties. The inclusion of private properties in the scheme will impose the risk of hefty claims on the funds available. It could also result in the need to raise insurance premiums, to the detriment of the many lower income owners of HDB flats. (b) Owners of private residential properties are generally professionals and others in the middle and higher income groups. They can insure their properties with private insurance companies if they wish. I am therefore not in favour of including private property owners in the CPF insurance scheme. SATURDAY SITTING (Business Motion) 11.”
“The answer is yes, if necessary, Mr Deputy Speaker, Sir. CPF APPROVED RESIDENTIAL PROPERTIES SCHEME (Withdrawal limit of Property Values) 14. Dr Ho Tat Kin asked the Acting Minister for Labour, since the Government has revised the Central Provident Fund regulations to allow members to withdraw up to 100% of their ordinary account balance to buy private residential properties under the Approved Residential Properties Scheme (ARPS), whether he will also consider (i) changing the total withdrawal limit of 80% of the value of the property at the time of purchase to 100% of the value of the property to make it easier for more people to upgrade to private properties, and (ii) allowing the CPF Home Protection Insurance Scheme which is currently available only to Housing and Development Board apartment owners, to be extended to ARPS owners as well.”
“Mr Deputy Speaker, Sir, what I said was that in the event of a severe world depression with large numbers of workers unemployed for long periods, we will then consider releasing their CPF savings to help them tide over the period of unemployment. The question of payroll tax has, I believe, been debated many times in this Chamber and the answers were already given by the Minister for Finance. I do not see the direct relevance to this question here, but if the Member would like to raise this question and debate it, he should address it to the Minister for Finance.”
“Mr Deputy Speaker, Sir, may I first correct a misinterpretation there on the part of the Member for Anson. I did not say that my Ministry does not have the information on people who have been unemployed for more than six months. I am sure we have the figures but I am not quite sure whether they are in the form that he wants them. As regards the period between retrenchment and re-employment, our surveys have shown that the majority of workers can find jobs within a few months and many of the retrenched workers also have retrenchment benefits amounting, in many cases, to one month per year of service. So they do have quite substantial amounts. My advice to some of these people would be not to be too choosy; try harder to find a new job because there are plenty of jobs available.”
“Mr Deputy Speaker, Sir, we do carry out surveys periodically to determine how many people are unemployed and, of course, we also do have the registry with the Employment Service Department. But in the case of the Employment Service Department, some of the registrants do not inform us when they have got jobs. So, in fact, we have to countercheck with the CPF Board to find out whether they have got employment. But, on the whole, if we were to look up the papers everyday we will find that the columns in the job advertisement section are still full of job offers and as at the moment there are still more jobs listed with the Employment Service Department than suitable applicants.”
“Mr Deputy Speaker, Sir, the best way to assist workers who lose their jobs is to help them find alternative employment. This is what my Ministry is doing through the Employment Service Department. Most of the retrenched workers are able to find their own jobs and do not approach my Ministry for assistance. They generally also have retrenchment benefits to tide them over the interval before they find suitable new jobs. We currently have a situation of technically more than full employment, with many foreign workers in Singapore. The Government will continue to pursue sound economic policies to ensure as far as possible full employment for our citizens. We must continue to attract new investments to create better jobs. To do this, we must preserve our political stability and ensure that our costs are competitive in the world market. We should, however, avoid falling into the welfare trap which many developed countries are trying to get out of. Their unemployment benefits are such that many workers find that they are better off not working. As a result, those who work subsidize those who choose not to work. Our policy should continue to be: good pay for good work and no pay for no work. Only then will our economy remain sound and competitive.”
“Sir, at the moment it is still a hypothetical question because our situation is much better than that because most people still have jobs. But if there is a need, I am sure the Government will look into the various possibilities. ASSISTANCE TO RETRENCHED WORKERS 13. Mr J.B. Jeyaretnam asked the Acting Minister for Labour whether the Government has any plan or scheme to help workers who have been thrown out of employment and, if the Government has any scheme, will he outline the scheme and the measures that will be taken under it.”
“Mr Deputy Speaker, Sir, in the event of a severe world depression, the Government will look into the possibility of releasing some of the CPF savings to workers to help them tide over their unemployment difficulties. This is, I think, what the Prime Minister mentioned in his National Day Rally Speech - that should there be a prolonged period of unemployment and very severe unemployment, then we will have to look into this use of CPF savings for the workers.”
“Mr Deputy Speaker, Sir, about 7,000 local workers were retrenched during the first half of this year. The prospects for re-employment of retrenched workers are still fairly good. Most of them can secure employment within a few months after their retrenchment if they are not too choosy. There are still sufficient jobs available although some applicants may have to accept jobs other than those they would like or are most suited for, In July 1985, for instance, the number of new job seekers registered with the Employment Service Department (ESD) was 1,894 while the Department received notification of 2,494 new job vacancies. Technically, we have more than full employment as we still have over 100,000 foreign workers in the labour force. The new hotels are nearing completion and will require workers to man them. Despite the economic slow down, new investments in manufacturing are still being committed. The Employment Service Department of the Ministry is assisting those retrenched workers who require help to secure alternative jobs. Efforts are made to persuade employers to employ the older workers. The Department also counsels workers on their job expectations. During the first half of this year, ESD offered assistance to 2,991 retrenched workers. Only 733 or 25% responded to the offer. 265 of the 733 subsequently informed ESD that they had found their own employment. 543 jobs were offered to those who responded. It would appear that most retrenched workers are able to find re-employment without assistance from my Ministry.”
“Interest on late payment is charged at 1 1/2% per month. ASSISTANCE TO RETRENCHED WORKERS 12. Mr S. Vasoo asked the Acting Minister for Labour (a) how many local workers have been retrenched since January 1985 up to the latest convenient date; (b) what are their prospects for re-employment; and (c) what steps are being taken to assist them, particularly the older workers, to secure alternative employment.”
“Sir, if the employers are late in payment and if they are taken to court, the court would allow them time to pay over several instalments. So I think this is one way in which assistance is provided to employers to help them pay the CPF. As for the fines (I am speaking from memory here), I think it will range to about $10,000, but I do not have the actual figures. If the Member would like to have the information, I will supply it to him in writing.”
“In 1984, there were 77,390 employers who made contributions to the CPF on behalf of their employees. Of these employers, 939 or 1.2% were three to six months late in making their contributions, and 305 or 0.4% were more than six months late. For the first half of this year, 1,155 or 1.5% of the employers were three to six months late in making their CPF contributions, and 307 or 0.4% of the employers were more than six months late. From the above figures, it would appear that the vast majority of employers have been able to make their CPF contributions on time or not more than two months after the due dates. Only a very small percentage have had to be taken to court to enforce payments. Of these cases, the employers have paid or are still paying up their arrears. Only a very small sum, 0.1% of the amount to be recovered under court order, has been written off so far, Whilst safeguarding the interest of its members, the CPF Board is careful to allow defaulting employers time to pay and not to push them over the brink.”
“I do not know whether it is a relevant question because he is merely expressing his own opinion on the issue. CONTRIBUTIONS OWING TO CPF BOARD 11. Dr Toh Chin Chye asked the Acting Minister for Labour what was the number of contributions owing to the Central Provident Fund Board (i) for three to six months and (ii) for more than six months, for the year 1984 and for the period January-July 1985.”
“Sir, any form of investment carries some risks. But I think we should look at investment in properties over the long-term, and the expectation is that, over the long-term, they will be worthwhile investments.”
“Sir, the answer is yes, we have got our priorities correct. The difference between investment in properties and education is, of course, that you are in fact transferring the benefit of the latter to another person. I am not saying that education is not a form of investment. It is. But there are various alternatives available, such as the one suggested by the former Minister for Finance, like interest-free loans. I think this should really be looked into because the CPF savings of a lot of the older members are, in fact, quite low. For example, about 68% have less than $20,000 each in their CPF balance. So we will have to examine all the various possibilities before considering what should be done.”
“There is a committee in my Ministry which is looking into the CPF question, and we will look at the various possibilities. Maj Fong Sip Chee: Mr Deputy Speaker, Sir, this is an old question. From the answer given by the Minister on the question of priority, I would ask the Minister whether he would agree that at this moment the priority is to allow members to own a second property rather than allowing them to use the extra money for the education of his children. Does the Minister agree that in the situation where a member has no alternative, instead of putting the money in the CPF deposit he would rather use it to acquire a second property, since he cannot use it for his children's education? May I ask the Minister whether he has got his priorities correct?”