Leong Horn Kee
Singapore
“My question is that, although at the point of purchase when the blocks were built, this may not be structural deficiency, as the Parliamentary Secretary said, but it is now because the demand or desire is for lift access.”
“Lastly, by centralising at MOM, I wish to urge the kind Minister to provide more funds and resources for job search programmes. Most feedback from residents is that they are not getting sufficient help and satisfaction on job search services at the CDC level.”
“At the same time, our SAF soldiers are better educated and trained to handle more sophisticated fighting system. Thus, the combination of both modern weapon systems and better trained soldiers will provide a good platform for our SAF to build a strong and capable integrated fighting force.”
“All right, "may" allow two months of disruption. But in terms of cohort, after the students have left school, they are no more in the same cohort. They actually enter enlistment at different times of the year. So this issue of relating cohort to enlistment period may not be valid. Therefore, why not just have a clarity of rule?”
“Sir, on this issue of early disruption of two months, we should actually look at it not from the two months' point of view of early disruption, but from the 10 months of waiting time. The servicemen will have to mope around waiting for 10 months for his tertiary education.”
“If the safety and personal security in Johor is not improved, no matter how excellent or scenic a bridge we build, Singaporeans will be hesitant to visit Johor and spend time and money there.”
The complete record
Every one of 876 lines we hold for Leong Horn Kee, in date order, each linked to its source. Free to read, in full, without an account. Page 8 of 18.
“Sir, in the experience of other countries such as in the US, incubator centres have been set up by the private sector. In the US, they call them by various names like hatcheries, garages or even accelerator programmes. These are all based on the same concept, which is to help start-up companies to be formed and enable them to grow quickly from a start-up stage to a mature stage. Even in Malaysia, I understand that they have the Multi-Media Super Corridor. They have provided a very huge area to provide for a very massive incubator centre, so as to encourage Malaysians to get into this incubator centre concept. Sir, I would like to ask the Minister what are NSTB's plans to support or develop incubator facilities in Singapore, and what are the programmes of the NSTB to collaborate with the private sector to create more incubator centres. Also, will the Government consider giving special incentives or encouragement so that the NSTB together with private enterprise can set up more incubator centres in Singapore in future?”
“Mr Speaker, Sir, in joining this debate on the National Science and Technology Board (Amendment) Bill, I wish to raise two issues so as to seek further information from the Acting Minister. First, I wish to ask the Acting Minister what are the future plans of the Government and the role of the NSTB with respect to the Technopreneurship 21 plan. In particular, I understand, as reported in the press covering a speech made by the Deputy Prime Minister Dr Tony Tan, he said that the $1 billion technopreneurship fund would be fully invested by about the middle of this year, which is quite soon. Hence, I would like to know what are the Government's intentions to provide additional funding of this programme, and how the NSTB would be involved in actively pursuing the objectives of Technopreneurship 21. I also like to urge the NSTB to work closely with the private sector in its future plans in promoting entrepreneurship and technopreneurship development. Sir, my second query relates to clause 5 of this Bill. It says that the amendment Bill would expand the powers of the NSTB in order for it to discharge additional functions. And the NSTB would have powers to provide or develop, in partnership with the private sector, programmes such as incubator centres and other business support facilities. Sir, here, I would like to declare that I am a director of a company involved in incubator centre facilities in Singapore. However, my view is that we should encourage technopreneurship, there should be more competition and more incubator centres and more of such support facilities to be established in Singapore. Only by having more such facilities can we then be able to build up a critical mass of young entrepreneurs among our Singaporeans.”
“Sir, I wish to thank the Minister, the Minister of State and the Senior Parliamentary Secretary for their excellent replies. May I beg leave to withdraw my amendment? Amendment, by leave, withdrawn. The sum of $365,626,100 for Head W ordered to stand part of the Main Estimates. The sum of $4,275,331,000 for Head W ordered to stand part of the Development Estimates. Head T -”
“Sir, thank you for allowing me to just make a few comments. I would like to thank the Senior Parliamentary Secretary for giving us a good reply to my request for improving Sentosa. In fact, I think this is the fastest response I have ever come across in the Committee of Supply. A large $140 million will be given out straightaway after a request has been made. On this point, I would like to ask the Senior Parliamentary Secretary whether this new MRT link will link up with the Sentosa Cove which is the new residential area in Sentosa. I would also like to thank him for the reduction in the entrance fee to Sentosa. How about a reduction in entrance fees to the other attractions in Sentosa as well? The last point is to ask the Minister himself. I did raise a suggestion about pioneer status for start-up companies. Could he comment on the proposal of giving some pioneer status to start-up companies?”
“SMRT is only required to recover the operating cost. Therefore, I would like to urge the Minister to direct his officers to do a quick and comprehensive review of Sentosa.”
“Sir, Sentosa Island brings back fond memories for many of us. During our younger courting days, many of us spent happy hours there. But I wonder how many Members here have recently been to Sentosa. Sentosa is still one of the few popular places for recreation and sports for locals and tourists. But, sadly, I feel that the place has lost its novelty and attraction. Therefore, I wish to urge the Minister to look into spending more money to revive and improve Sentosa. For a start, the existing access and transportation should be improved. The monorail system there is very slow, old, inefficient and it only goes in one direction. In fact, new attractions can be added to make the place more interesting. Why not add some roller coasters or more fun and interesting rides to thrill the visitors? We should also encourage more outdoor activities there like windsurfing, boating, horse riding, kite flying and so on. At present, the entrance fees to the various attractions are too high and are a deterrent to visitors. I have computed that the entrance fees to Sentosa and to all the attractions, such as Fort Siloso, Underwater World, Fantasy Island and so on, cost a total of $93.50 for an adult, and a total of $57 for a child. It is not cheap, even by Singapore standards. So, to make Sentosa vibrant and affordable, I would like to suggest that the Government should treat the capital expenditures for the infrastructure and the facilities at Sentosa as grants to be provided for the recreation of Singaporeans. Sentosa Development Corporation (SDC) should be required to recover only the operating cost. This is the same principle used for the SMRT, where the capital expenditures for the fixed stocks and the rails are treated as Government infrastructural grants.”
“Sir, the prices of electricity tariffs have increased quite substantially, by 20% in the last few months. Most local manufacturers are complaining and, in fact, are very concerned. This is due to the sharp rise in oil prices in the last few years. For example, oil prices actually increased from US$11 in 1998 to nearly three-fold, to $32 this week. Singapore is very dependent on external sources for energy, especially on crude oil for our electricity generation. I would like to know how to make the energy sector more efficient. For example, electricity generation can be deregulated so that more companies can be allowed to participate in electricity generation in Singapore. If a company can find it useful and cheaper to generate its own electricity, and even have some spare power to sell to other users, they should be allowed to do so. Moreover, in view of the rising electricity prices, would it be worthwhile to reactivate the energy-saving campaigns?”
“Sir, water is a scarce resource. I wish to ask the Minister for details of his Ministry's plan to explore other sources of water, besides our own water and water from Johor. For example, what is the status of the announced plan to start desalination plants? Can the private sector be enticed to participate in the construction of desalination plants? What are the technologies available, and the current economics of desalination plants versus processing of raw water? In addition, I would also like to know whether the Government intends to promote water conservation again. Another idea that has been mooted is to have a dual water reticulation system, ie, one system for potable water and another for industrial water. Is this system, which has been used in other countries, feasible for Singapore?”
“The idea of a third body to have a new high number of private sector staff agency, maybe a new one, would serve as a third body to provide more avenues for start-up companies and technopreneurs to seek funding support. Sir, during the Budget debate, I also proposed that pioneer status, ie, five years' tax free status, be accorded to start-up companies. These companies are pioneers in their own field such as info-com and biotechnology, and they should be encouraged. They will form a new wave of pioneering changes in upgrading the industrial development of Singapore. Sir, I am particularly keen on this idea of a pioneer status for high-tech start-up companies, not so much for the incentive as not many of them will make money in the first five years to enjoy this tax benefit, but for the recognition that we give to them, and in the process create an environment whereby more high-tech companies are encouraged to be formed, just like in the early days of Singapore's industrial development, pioneer companies were given this special status. Sir, I feel that the proposed additional fund and a third agency to channel through the funds and awarding pioneer status to selective start-up companies will serve to give another boost to Singapore's technopreneurship plan.”
“Sir, under the Technopreneurship 21 Plan, the Government has allocated US$1 billion to promote technopreneurship. Recently, Deputy Prime Minister Dr Tony Tan announced that over half of this sum has been committed for start-up companies and venture funds which promote such technopreneurship development in Singapore. Dr Tan announced that this investment fund will be fully invested by June, and the Government is considering launching a second fund. The effects of the funding support from the Government and the drive towards technopreneurship is being felt in Singapore. As I have said earlier in my speech, in my recent meetings with young founders and managers of several local start-up companies, I can discern a strong sense of purpose, drive and direction amongst them. There is a strong emergence of heightened energy level amongst these young people who ventured to found new start-up companies. I strongly feel that we should continue to harness and propel this growing energy by providing more funds, more support facilities such as incubation centres and creating a conducive environment where our local technopreneurs can flourish. To continue with this Technopreneurship 21 drive, I would like to suggest that the Government should allocate more money, say, another US$500 million or even a full US$1 billion towards the new Technopreneurship programme. In addition, instead of channelling the new funds to the existing two agencies, ie, the National Science and Technology Board (NSTB) and the GIC, to allocate out the funds, I would like to suggest that some part of the new funds be assigned to a third agency which has a large proportion of private-sector trained executives to be in charge. The two existing agencies, NSTB and GIC, have done an excellent job.”
“Sir, first I would like to declare that I am a Director of a company involved in property development. We have to maximise the use of our limited land. I like to propose the following suggestions on how land can be used more intensively. Firstly, to allow the use of higher plot ratios for land development. Compared to the major cities around the world like Tokyo, Hong Kong and New York, Singapore is less developed in terms of land use. In these cities, their buildings are definitely higher and land development is being used more intensively. Secondly, to allow more flexibility in the usage and change of use of existing buildings and built-up areas. Some buildings or areas were constructed for an original approved usage. However, over time, the demand or the nature of the location changes. Hence, there may well be a need to change the usage to another type so as to match the surrounding developments. For example, a building may originally be built as an industrial building. But as it turns out, there is more demand in the locality for use of the premises as showrooms, offices or even as residences. The owners should therefore be allowed more flexibility in the usage and conversion. Otherwise, the building will remain vacant and unused. Thirdly, the possibility of co-location and mixed use of different types of premises will enable more intensive use of a building. Subletting and renewal of leases will enable the existing premises to be better used, or re-developed for other purposes. Sir, in land scarce Singapore, I feel that within certain broad rules and guidelines, it is very critical that land use be more flexible and intensified.”
“Sir, I can feel in them a strong sense of purpose and urgency in them wanting to venture out and start up companies based on their ideas and dreams. The Government has started the Technopreneurship 21 programme. I fully support this programme. In fact, I would like to urge the Government to do more, such as providing more funds, support facilities and create a conducive environment for enterprise, and for those daring to dream and daring to venture. Sir, I shall elaborate on each of the above ideas in more detail as I speak on each of the subjects later.”
“Some, such as Inderjit Singh and Mrs Lim Hwee Hua, have conjured the vision of an entrepreneurial civil service. I support their vision, but I despair that this vision will only remain as a hope unless there is more urgency in the declared plan on infusion of entrepreneurial blood in the top ranks of the civil service and the leadership, and a major paradigm shift in the mindset of our civil servants. Second, maximising the use of our resources. We have to maximise the use of our limited resources. The land use in Singapore can be intensified by allowing higher plot ratios for land development and more flexibility in the change of use and the type of use of our land. For example, Sentosa Island is one of our main tourist attractions, and the playground of the residents living in the main city. Hence, I feel that Sentosa Island should have been more intensively developed, and the infrastructure should be improved. More attractions can be added. We should also do a review of our electricity, gas and water supply and the usage policy so as to ensure that these precious resources are efficiently produced and used in Singapore. Third, maximising the use of our limited manpower. As it is now, we have to bring in large numbers of foreign professionals and workers to supplement our local pool. Hence, we have to create an environment where both local and foreign manpower can give their best. By this, I mean we have to actively promote technopreneurship. Arising from my professional occupation as a director of a local firm that is interested in e-commerce investments, I have recently met with and come across many local firms and young persons who want to start up new businesses.”
“Sir, I beg to move, That the total sum to be allocated for Head W of the Main Estimates be reduced by $100. Sir, actually there are two key imperatives in the economic development of modern day Singapore. One is to ensure that we devote sufficient resources and effort to build Singapore into an advanced knowledge-based economy that can compete with the rest of the world. The second imperative is to mould and build our local people and local capabilities that could measure up against the best in the world. Unfortunately, within the framework of Singapore, we are actually faced with many constraints. First, we are small. Second, we have no resources and, third, we have limited manpower. But remarkably, despite these handicaps, we have managed to work together as a nation that has achieved phenomenal stability and growth in the last 30 years, and ranked as one of the most competitive countries in the world. No mean achievement for Singapore. Sir, allow me to discuss in big broad strokes some of the major issues and actions that the Ministry of Trade and Industry has to address as the key national agency that oversees economic development of Singapore. Given our well known constraint, this is not an enviable task. Sir, on cost competitiveness, because of our shortage of land and manpower, our cost of doing business continues to be high and not competitive versus the neighbouring countries. The Government has been vigilant over business costs. We cannot artificially suppress business costs, but we should at least ensure that such costs do not escalate, or unnecessary costs or time be wasted due to bureaucratic rules and regulations. Many of my fellow GPC colleagues have touched on this point.”
“I would like to express the disappointment of my fellow MPs who have not got their answers from the Finance Minister and that the time for the debate has been robbed by CLOB. May I beg leave to withdraw my amendment. Amendment, by leave, withdrawn. The sum of $823,716,630 for Head N ordered to stand part of the Main Estimates. The sum of $354,665,400 for Head N ordered to stand part of the Development Estimates. Head O -”
“Sir, may I ask a quick clarification? I would like to ask the Deputy Prime Minister whether he feels that this 1 1/2% charge by Effective Capital is fair and reasonable? And after getting the fee upfront, if they renege on the whole agreement and they do not release the shares, what will happen? BG Lee Hsien Loong: Mr Speaker, Sir, it is not for me to decide whether 1 1/2% is enough or not. That there should be some fee for a transfer is not surprising, because there are some expenses incurred. As far as the investors are concerned, it is only the fee which matters and not to whom the fee is paid. In this case, the arrangement is with Effective Capital. We accepted it as so, because that is the preference of the Malaysian side. What if, after having paid the fee, the shares are not transferred? The fee is being paid into Standard Chartered Bank and held by a stakeholder, which means that it is not going to be transferred to ECSB until the shares are transferred and released. And if the shares are not transferred and released, then you can have your 11/2% back.”
“Sir, I would like to raise a point with the Minister on the need for his Ministry and related bodies, such as the SGX, to devise new rules, laws and regulations to regulate Internet companies which are able and effective to control and police the virtual Internet world. These Internet companies could well be promoting vice, such as pornography, gambling, or other unsavoury products and services on the Net. Moreover, they will have a strong impact on the minds of our younger population, especially the students who have easy access to the Internet, thanks to the very effective IT education they receive in the schools. Our young children from ages between 8 and 9 years old, are now quite Net-savvy. I would like to ask the Minister what can the Government do to control Internet companies and the type of products and services they offer.”
“For such companies, perhaps to attract them and as a form of encouragement, maybe it will be useful to consider tax free status for the first five years.”
“In addition, as I have proposed in my speech during the Budget debate, I would like to propose that a grant be given to local grassroots organisations, such as the Citizens' Consultative Committees (CCCs), so that they can also conduct more self-improvement or IT training courses at the community clubs at subsidised rates. This will be beneficial to a pool of lower income or senior citizens who wish to be trained or who want to receive more self-education. Finally, I would also like to propose, as I have said in my Budget speech, that a grant or income tax relief be given to individuals to purchase PCs. This proposal would encourage more and more Singaporeans to embrace IT technology. As a result, this will speedily create an environment in Singapore where an increasingly large percentage of our adult population would understand and appreciate the fast moving Internet and e-commerce society. For my second cut, I would like to join my colleagues in speaking on the employee stock option scheme. Here, like my colleagues, Mr Inderjit Singh and Mrs Lim Hwee Hua, I would like to urge the Government to consider more enhanced benefits for employee stock option schemes. Many companies, especially new start-up companies, do not have the funds to employ and attract key employees who are important to the companies. Therefore, they use ESOPs as a main carrot. So I would propose that the Government consider allowing such ESOP schemes to be given to high-tech companies to be declared tax free, say, in the first five years when they exercise such options. Currently, when they exercise such options in the first five years they are deemed liable to pay income tax.”
“Sir, I am trying to cut short my speeches, as you have requested us earlier. Sir, the Finance Minister currently allows any individual to claim a very small personal relief as his income tax relief when he attends certain professional courses. This relief is to allow an individual to deduct up to $2,500 of course fees for courses leading to a professional or academic qualification or vocational qualification relating to a person's existing trade, business or employment. I would like to propose that this relief be increased perhaps to $5,000. The reason is that nowadays course fees are very high. Professional or vocational course fees can cost $10,000 or more. Hence, to encourage more Singaporeans to improve themselves, a higher course fee relief will encourage them to enroll into more self-improvement education. In addition, I would also like to propose that these course fees be extended to not just professional or academic qualifications or for other self-improvement educational courses. Such self-improvement courses will not necessarily be related to a person's trade or vocation. For example, there may be many people who want to attend a new skills course or new vocation course so as to get a new job in a different trade. Also, there may be people who want to attend IT or computer training courses but they themselves are not necessarily IT professionals. This proposed relaxation of course fee relief benefit would be useful to ensure that more and more Singaporeans attend retraining or self-training programmes of all kinds.”
“Hence, these Internet companies have customers located anywhere in the world, and the companies themselves may not be registered or based in Singapore. However, their operations and products may be targeted at Singaporeans or can reach customers in Singapore. My question is: how could the Singapore Government, or any government for that matter regulate and control these virtual companies on the Internet? In particular, if these companies turn out to be very profitable, how do we measure the amount of profits that they derive from doing business in Singapore, and therefore the Singapore Government can be eligible to tax such companies? 4.00 pm On the other hand, to promote more Singaporeans venturing into new start-ups, especially into e-commerce start-ups, I would like to ask the Minister whether he could consider incentives to encourage these start-up companies to be formed. For example, in the early years of their formation, can the Government give them preferential tax status or more R&D grants so that they can quickly complete their product development and commercialise their products?”
“Sir, I agree with what Mr Inderjit Singh has just proposed on the need to do a complete review of the tax system and, in particular, to look at specific target areas that can be changed. I have spoken on this subject of group offsetting of taxes during the Budget debate. In response to this suggestion of allowing group offsetting of taxes made by several of our parliamentary colleagues here, the Finance Minister has given his views in his response at the end of yesterday's Budget debate. However, I would like to continue to plug at this issue which I feel is a very worthwhile cause and, hopefully, in the process can crack the nut with the Finance Minister. Raising this issue here will also give him a chance to explain to us in more detail, if he does not agree. Sir, I would like to repeat my suggestion, which is that the Government should have taken the line that although it does not want to allow group offsetting of taxes for a variety of reasons, we should not look at it on blanket basis, but more on a specific case by case basis. Therefore, I wish to repeat that for specific cases, such as for sectors where the Government wishes to promote more investments to be made, say, in the area of infotechnology and other high-tech areas, the Government could actually consider allowing losses of such new ventures to be offset against the profits in other parts of the principal business of a company. Companies will therefore be more ready to invest in new ventures and in high-tech areas. In the process, Singapore will gain. Sir, my next cut is on taxation of e-commerce. Internet companies operate in a virtual world where there are no sovereign boundaries.”
“Generally, since there is a very beneficial effect to encourage more M&As of local companies, I would like to suggest to the Finance Minister that the local tax regime, ie, the Stamp Duties Act and the financial regulations, should be reviewed to ensure that there will be more M&As in Singapore.”
“How can e-banks be regulated so as to preserve the integrity of our banking system? Sir, I move on to my next cut on mergers and acquisitions (M&As). In his Budget speech, the Minister has mentioned that previously, if an M&A involves the transfer of less than 90% of a company's shares, or if the consideration is made in cash, the exercise would not qualify for stamp duty relief under section 15 of the Stamp Duties Act. To encourage more M&As, the Minister has decided that these two conditions be lifted and the qualifying limit for the main holding company be reduced to 75%. I would like to laud the Minister for initiating this move to encourage more M&As in Singapore. However, I would like to suggest that the qualifying limit can be lowered further to, say, even as low as 51%. Here, I wish to declare that I am a Director of a company and I am making such suggestions for the general public interest. Sir, there are many local companies, especially SMEs, where it would be extremely beneficial to encourage more M&As amongst these local companies. This will enable the smaller SMEs to merge and create more bulk. In the process, they can achieve better economies of scale, streamline operations, and attain cost savings. As companies merge, it would become increasingly difficult for the main acquiror company to hold 75% or more of the combined entity. There is also the deterrent that the owners of the shares or assets of the company being acquired may be subject to heavy taxes on profits deemed to be realised. In some of these cases, there are no actual cash transactions, but just an exchange of shares. Therefore, paying the tax on the gain will become a great deterrent to the entire transaction, especially when there is no cash involved but only just paper gain.”
“Sir, I beg to move, That the total sum to be allocated for Head N of the Main Estimates be reduced by $100. Sir, in moving this cut, I wish to ask for an update from the Deputy Prime Minister on the status of the Government's plan to encourage the merger of local banks. The Government has announced that eventually there should be only two large banks in Singapore. The question I would like to ask is that currently, there is no evidence of any deliberate move by local banks to work towards some form of merger. Banks have appointed their Nominating Committees, but nothing much else seems to be done. I would also like to take this opportunity to better understand what are the benefits of having fewer, though larger local banks. I would like to know why the conclusion that Singapore can only support two local banks. The question on people's mind is which two, and why only two. Why not three, why not more? Is there a target time-frame? Is the pace of change going at a rate that the Government is satisfied with? The other question I wish to pose is that if there are eventually to be only two local banks, would there be adequate service and attention given to the small companies and the small individuals. Large banks tend to favour and service large customers. Who is there to service the local customers and the small man-in-the street? Another point I would like to pose on the banking system is that, with the advent of e-banking that is, banking on the Internet, how would Government regulate this sector? Would the usual rules of MAS be applicable for banks, some of which may not even be necessarily regulated by our Singapore authorities operating through the Internet? Can such banking practices and transactions be adequately controlled by the authorities?”
“May I ask the Senior Parliamentary Secretary, in the selection of the private estates, can I volunteer some of the private estates in my constituency because I had actually proposed this idea some years ago and it had not been taken up? There are quite a number of estates which are quite well organised, in terms of neighbourliness, and also conducive for this purpose. Assoc. Prof. Koo Tsai Kee: Mr Speaker, Sir, we will take up his suggestion.”
“This could be achieved by the Finance as well as the Trade and Industry Ministries calling for separate meetings with representatives of these sectors, so that their problems can be studied in depth, and appropriate assistance given when necessary. Similarly, the local small and medium enterprises (SMEs) may be slow in achieving a quick recovery because they are beset with multifarious problems, such as heavy overheads, labour and managerial insufficiency, low productivity, rising retail and labour costs and structural changes. Therefore, better liaison and consultation between the Government and the SMEs will give rise to effective targeted measures to assist them. Mr Speaker, Sir, I would like to conclude by urging the Minister for Finance to take a more urgent, bolder and generous approach to prepare Singaporeans and the local companies to meet the challenges of the new economy. As the Finance Minister has said in the conclusion of his Budget's speech: "We have to face up to the challenges of a globalised economic system and keep pace with changes . We need to accelerate the pace of economic restructuring. " Thus, I would like to urge the good Finance Minister, do not hold back your pen, write in the benefits and incentives now, so that we can be better placed to meet the velocity of changes ahead.”
“Similarly, for those people of the lower income group who do not pay personal income tax, grants can be given to designated grassroots organisations such as the CCCs to conduct computer courses, where the lower income persons can attend at discounted rates. While it is suggested that Government funds be used to foster knowledge technology, e-commerce talent pool and skills, and prepare our economy for the global stage, we must also devote money, effort and attention to build and enhance our local capabilities. Here, Mr Speaker, Sir, I am referring to how to assist our SMEs. While we wish to promote a pool of companies and individuals to compete against the best in the world, we must not forget that there is the main body of the working population and the SMEs which employ them who need help to change and adapt to the new economy. These SMEs need to understand the technological changes in the market place, how they can restructure or adapt, and how their owners, managers and employees can be trained or retrained to remain employable. This is how to remain e-relevant. As the Minister has said, some sectors of the economy are not fully out of the woods yet. These sectors will continue to need assistance. They are the retail, tourism, construction and trade sectors. They may think some of the budgetary measures could mean that their recovery process may slow down or take longer. I would like to appeal to the Minister to look into industry specific measures that can be implemented to continue to assist these sectors that are lagging behind in the recovery.”
“The objective is to encourage all citizens, whether young or old, to purchase a personal computer (PC). I am very pleased to read about Government's intention to commit $25 million over three years to provide used PCs to the lower income group, as announced by Mr Yeo Cheow Tong, the Minister for Communications and Information Technology, last week. However, I think that the used PCs scheme may not be enough to reach all the households in the lower income group. Some people may not be interested in using used PCs. They may think that it is too slow or it may not have the advanced features to excite them. My proposal, which is to give an incentive of personal income tax relief to purchase new PCs, will serve as a meaningful gesture and a supplementary scheme to this MCIT scheme. This will be particularly meaningful to the middle and lower income groups to encourage working adults to purchase PCs, whether for use at home or in the office. For those who are not paying personal income tax, an alternative scheme can be devised, whether the local constituency's grassroots organisations, such as the Citizens Consultative Committees (CCCs) can become the channel through which the Government can give out a grant of, say, $200 each to encourage the lower income groups to buy PCs. In addition, I would like to propose that, so as to promote a wider spread of IT and computer education, especially for the adult or older population, the Finance Minister encourage adults to attend self-improvement computer courses. Again, personal income tax relief of, say, $500 each can be given for attendance at computer courses conducted by approved educational companies.”
“Even those who have failed are not lost, since the entire process will help propagate an environment in Singapore of technopreneurship and risk taking, something which both our PM and SM have said is sorely lacking in Singapore. For those who succeed, they will become our hero stories. In Singapore, we are also in dire shortage of home grown success stories. The only often-quoted one is Mr Sim Wong Hoo of Creative Technology. I feel we need more of such success stories, as they are plentiful in the USA, like Stephen Case of AOL, Jeff Bezos of Amazon.com and Lawrence Ellison of Oracles, or Masayoshi Son of Softbank in Japan. The third is tax relief or double taxation allowances for IT expenditures. As a move to encourage companies to adopt IT systems and re-engineering of their businesses, I would like to propose that the Finance Minister consider giving tax reliefs or double taxation allowance for companies which want to spend money to purchase IT equipment that will improve their productivity or efficiency. This incentive will be particularly important to SMEs which are usually not IT oriented, and do not have the in-house technical expertise to help them push into the IT environment. Fourth, personal income tax reliefs for purchase of computers. As I said earlier, I feel strongly that as the Government has achieved a substantial surplus of $3.2 billion, it could have been more generous in rewarding the citizens. Of course, the $250 CPF top-up payment into the individual's CPF account is a very appreciated gesture. In addition, I would like to propose that the Government consider giving a tax relief of, say, perhaps $500 a year to all citizens who purchase a personal computer.”
“As in the early years of Singapore's economic development, pioneer status was given liberally to new companies so as to stimulate industrial development. I think the same approach can be taken for start-up companies in the new pioneering fields such as IT and e-commerce. They are pioneers indeed in an unknown and fast moving environment of the IT and e-space. They have to move at the speed of thought and compete against the best in the world, such as their counterparts in the Silicon Valley in the USA, or other similar start-ups that are sprouting in other parts of the world, such as Canada, Europe, India and even China. I wish to suggest that these start-up companies in Singapore can be given 5 years pioneer tax-free status. The above two incentives are meant to work hand in hand to encourage a proliferation of start-up companies and build up a sizeable pool of financial backers. Many of these start-ups, perhaps as high as 90%, will not make money or even survive to enjoy their first 5 years of tax-free status. However, for those technopreneurs and their financial backers who succeed, they will be hugely rewarded. And Singapore will benefit, because we have managed, in the process, to become e-relevant, instead of irrelevant. Sir, this widespread, I would call it, "broadband"approach is better than a selective guarded "arrow band" approach, because of the uncertainty of technological changes and velocity of such changes. We do not know for sure which companies, whether a large GLC or a small start-up, will have the ideas, responsiveness, drive or creativity to succeed. Therefore, by encouraging as many as possible start-up companies to be formed, and give them the correct incentives and environment, hopefully, some of them will succeed.”
“As I was saying earlier, I feel that the Government Budget could have been bolder, speedier and more generous to help propel Singapore into the IT age. At the corporate and individual levels, the Budget could have been bolder in giving encouragement and incentives to those who dare to take risks. If the risk-takers who started ventures failed, they could be encouraged to start again. For those who succeeded, they should be richly rewarded. Moreover, in the process of carrying out their ventures, we should review and ensure that the Government agencies and Government regulators should facilitate rather than put obstacles in their paths. To encourage more companies to embrace IT technologies and invest in new ventures, I would like to suggest that the Finance Minister could look into the following areas: First, group offsetting of operating losses. The Government has been hesitant to allow group offsetting of subsidiary losses because of the concern over abuses and leakages. This is understandable. However, I feel that in the case of a genuine desire to venture into a new business, the company which is taking a huge risk can be allowed to offset their share of the losses in the subsidiary ventures against the profits in the other main businesses. If operating losses of new ventures can be allowed, a company's risk adversity would be reduced. If the Government is concerned about giving a blanket group offsetting approval, then approval can be granted on a selective industry basis. For example, such group offsetting could be considered for approved investments in IT and e-commerce. Second, give pioneer status for start-up ventures.”
“One is to devote sufficient funds, effort and attention to build Singapore into an advanced knowledge-based economy that can compete with the rest of the world, and the second is how to mould and build up our local people and capabilities which, infused with the right measure of foreign abilities, would be able to measure up against the best in the world. Our Government leaders, including PM, SM, DPM and other Ministers, have spoken recently in their speeches to embrace IT, be enterprising, be risk taking and facing up to the new challenges ahead. On account of the fact that we need to compete globally, I am disappointed that the Budget measures fall short of giving a shot in the arm for our companies and individuals to help them to prepare and propel them into the IT age. Bill Gates, the founder of Microsoft and reputed to be the richest man in the world, in his book called Business@the speed of Thought, said that in the digital technology age, business in the years 2000s will depend on velocity. That is, success depends on how quickly businesses are conducted. Thus, he means business is at the speed of thought, which is at the speed of light. Speed itself is a strategy. A good example is the recent saga of the sale of Cable & Wireless Hong Kong Telecom (HKT). Among the many factors, including political, I feel that Pacific Century CyberWorks has won the deal because of the speed with which they could react to the news that this company is available for sale and that they could make decisions very fast. Hence, speed is important. Anyway, let us leave this saga of the Cable & Wireless Hong Kong Telecom to another avenue for debate.”
“Singaporeans should be made to understand that in the new world order, we are no longer competing amongst ourselves in Singapore, or just against our neighbouring countries. Because of technological and communication advances, we are forced now to compete with the best in the world. If we cannot compete against the best in the world, we will become irrelevant. For example, the DBS Bank is no longer competing with other local banks, but against MayBank, HSBC, BNP and Citigroup and other premium banks in the world. Our NOL and SIA have to compete worldwide. Even our small traders and retailers are not just competing against other local retailers and traders, but have to face up against the retailers and traders in other countries. Ultimately, in fact, they will be competing against the e-commerce virtual companies, like Amazon.com and e-Bay. Nowadays, people choose not only which is the best and cheapest retail store to shop, but also which is the best and cheapest country to shop. As a country, we have to compete against other countries as the best place for our people and foreign professionals to live and raise their children. People also have many choices as to where to park their money. Singapore, because of our inherent domestic constraints, has lost its gloss as the best place to shop. We also cannot lay claim to be the best place to live. But we must continue to be a place where investors are prepared to put their money, and local and foreign professionals find conducive to work in. Against the backdrop of the New World Economy, Singapore and Singaporeans have to stay relevant. The Budget therefore has to address two key imperatives.”
“Mr Speaker, Sir, my concern is that the patient (which is the Singapore economy) is just beginning to enjoy a sharp and good recovery, and then the course of medical treatment is quickly cut back. Would the recovery spatter? Should we be consistent in going through the full course of recovery measures, which are originally meant to be over two years? In fact, why not add more vitamins and beneficial herbs to further strengthen the patient, and be doubly sure that he becomes strong and robust, and can run even faster ahead in the race? Hence, in looking at the package of recovery Budget measures announced, I feel that the Government should not have removed the 10% corporate tax rebate for companies. The 10% savings on corporate tax would be very helpful for companies to further fund their capital expenditures for automation, IT spending, streamlining and restructuring. To reward the individuals in accepting the belt-tightening measures, I would have thought that they should be rewarded by keeping the 10% personal income tax rebate, instead of cutting down to 5%. Sir, it is apt to call this Budget an e-Budget. As we move into the new millennium, there is a need to prepare Singapore to participate more deeply in the New World Economic structure. The world is changing so fast that the recovery, and a sustained growth for that matter, cannot be taken for granted. The point is that with the advent of new technologies, telecommunications and the World Wide Web, or commonly called the Internet, the world is changing and coming together at a very fast pace. The essence is to be e-relevant, and not become irrelevant. If Singapore becomes irrelevant in the new world order, we will surely fall by the wayside and wither.”
“But have not all past years' budgets been something for everyone? I think the best description for this year's Budget is that it is an e-Budget. It is an e-Budget not just because of its strong biasness towards e-commerce, but it also caters to the elderly, entrepreneurs and ESOP. In addition, I call it an e-Budget because it is an economical Budget, ie, a Budget that is economical in giving away just about enough, without being too extravagant. Sir, the Government has achieved a sterling performance in the management of the economy and the fast turnaround. The fact that we could achieve a budget surplus in FY99 as we were barely emerging from the crisis is extremely commendable, as I said earlier. However, for this year, I am disappointed that with such a good surplus, the Finance Minister has decided to so quickly roll back the set of economic recovery measures, and has not given enough goodies to reward the people for suffering through the belt tightening situation. Essentially, I feel that the Government could have retained the bulk of the economic recovery measures for another year. I recall that during the off-Budget debate in June 1998, we had likened the Finance Minister, our good Doctor Hu, to a medical doctor who was dispensing medication to the sick patient (the Singapore economy) which was suffering from a serious bout of flu. The medications were the budget recovery measures. It seems to me now that just as the patient is beginning to show signs of recovery, the good doctor has decided to roll back the medications. Has he cut back on the salubrious good doses of antibiotics and pills? Is this wise? Are we pulling back too quickly?”
“Mr Speaker, Sir, this year's Government Budget is underpinned by the remarkable recovery of the Singapore economy. We are glad to hear from the Finance Minister that the Asian financial crisis is largely behind us. Everyone could heave a sigh of relief. Because it was not so long ago that during the off-Budget measures announced in June 1998, that we were very concerned about a protracted U-shaped or, as the Deputy Prime Minister said, W-shaped, and a drawn out regional economic crisis that could last 2-4 years. The sufferings, not just to us, but also to the people in our neighbouring countries, would be unthinkable. Anyhow, we are all extremely glad that against all expectations, Singapore achieved a dramatic V-shaped recovery. What is even more remarkable is the fact that the Government FY99 Budget is expected to attain a surplus of $3.2 billion, as against an originally estimated budget deficit of $5.1 billion. This is a gigantic turnaround of $8.3 billion. While on the one hand, we wish to commend the Government, and the Finance Minister in particular, for this very positive turnaround, on the other hand, we wish to better understand two things. One is the reason for this discrepancy for the huge budgetary miscalculation, and hence whether the budget induced belt-tightening measures were unnecessary pains for the people and the local companies. The second point is whether, after achieving such a remarkable positive budget surplus, more could be done to reward the people and companies who have rallied so solidly behind the Government at the time of the economic crisis. Sir, I notice that for this year's Budget, the press had been hard put to pin a label or tag for this Budget. The Straits Times has been kind in calling it a "something for everyone" budget.”
“The Smartcard is being used in the airport, but is it also being used at the Causeway? Assoc. Prof. Ho Peng Kee: A pilot has been done for frequent travellers, for example, for those Malaysians who work in our factories who come across regularly. In fact, it is an advanced technology where you just use your fingerprint. So over time, travel between Singapore and Malaysia would definitely be facilitated.”
“For those regulars travelling between both sides of the Causeway, either for work or business, is the Government considering issuing a Smartcard to facilitate travelling? Assoc. Prof. Ho Peng Kee: This is already being done. A pilot has been done to issue those who are regular travellers with a Smartcard.”
“But as I have explained in my main answer, private sector offers cannot solve the CLOB problem because the CLOB problem involves the two authorities. The Malaysian authorities have a responsibility to deal with this. The CLOB investors, some of whom are not Singaporeans, have rights which they can expect the Malaysian authorities to respect. If you ask what is a fair agreement, I say a fair agreement is in accordance with the law and the contract. As to whether there is a basis for transfer to the Minister for Finance of Malaysia if they do not accept private sector agreements, MAS has issued a statement last year which I referred to, there is no basis of transfer to the Minister for Finance under Malaysian law. I am not saying whether it will or will not take place. But if you ask me whether under the law there is a basis, the answer is no.”
“Mr Speaker, Sir, firstly, while there may not be a need to disclose an internal deadline, it is useful to have the Members of Parliament on this side of the House to express that we prefer a stated deadline of, say, three months, that we want to make public to the Malaysian authorities. Thereafter, we would start the legal process. Otherwise, the legal process will never get started. Secondly, I would like to ask the Deputy Prime Minister, among all the proposals that have been tabled or made, is there any one that seems to be favourable or fair to our Singapore investors? Finally, the position which the Malaysians have proposed. They have threatened that if it is not solved, the shares would be transferred to the Malaysian Minister for Finance. Is there any basis for the Malaysians to claim that these shares could be transferred to the Malaysian Minister for Finance? BG Lee Hsien Loong: Mr Speaker, Sir, we have beaten the issue of deadlines to death. On whether any of the proposals are favourable and fair, it is not for me to judge. If a private sector proposal is made, which is fully in accordance with the law and we distribute it, then it is up to investors to make their decisions and decide whether it is favourable to them or not. They know their legal rights. We have informed them of their legal rights. They know that we are pursuing the matter with the Malaysian Government in order to help them to enforce those legal rights. So it is not a matter whether generosity has been exercised, but have their legal rights been fulfilled or not? If so, they settle. If their legal rights have not been fulfilled or there has been a breach, then it is up to them whether they want to settle for less.”
“BG Lee Hsien Loong: Mr Speaker, Sir, first on the impatience and indignation of investors, we have pressed the matter with the Malaysian authorities with all the vigour and urgency which we are capable of. They are aware of the impatience of the investors. SIAS has expressed itself repeatedly in public, including in Malaysia, and I am sure that proceedings in this House are also reported. It can be seen that many of the MPs have raised this matter on behalf of investors and wanted it to be solved. As for the Prime Minister meeting Dr Mahathir, I think what the Prime Minister said was that he may meet Dr Mahathir after the Chinese New Year period, not now. If, by the time he meets Dr Mahathir, the matter is not resolved, it will be raised between them. It cannot not be raised, because it is one of the issues. But we are not depending on personal arrangements to solve this problem. This problem has to be solved in accordance with the law, with the contracts, with the solemn obligations which the Malaysian Government has undertaken at the WTO. That is why Dr Hu has written to Tun Daim in order to ask him to get his officials to pursue the matter. Mr Leong then talked about the possibility of legal process in parallel. As I have said, it is a little premature for us to commit now and speculate on what we would do if our bilateral measures do not work. Dr Hu's letter to Tun Daim was on 13th January 2000. It is only a few days ago. So it is only courteous for us to give the Malaysian side some time to study the letter before we see how they decide to respond.”
“Sir, I have a few supplementary questions but, before asking them, may I declare that I have no personal pecuniary interest in this matter because I have no investment or shares in CLOB at all, but it is in the interest of 170,000 Singaporean shareholders who have shares in CLOB. First, I would like to ask the Deputy Prime Minister, in view of the tardiness or lack of reply from the Malaysian authorities, whether he would convey to the Malaysian authorities the impatience and indignation of investors, mostly Singaporeans and, in fact some Malaysians, on the delay. This delay has actually caused, in some cases, hardship or perhaps even bankruptcy to the investors who are caught in the bind. Secondly, we have read in the newspapers that our Prime Minister is going to have a meeting with Dr Mahathir after the Chinese New Year. I would like to ask the Deputy Prime Minister whether he would ask that the Malaysians include this CLOB issue as an agenda item in the discussion with the Prime Minister of Malaysia and also to convey the Singaporean investors' indignation and impatience over this issue. My third question is, while we are being patient ourselves and waiting for the Malaysian authorities to respond to our various letters, especially the most recent letter from the Minister for Finance, and in view of the June 2000 deadline, will it not be possible for us to institute the legal process at the same time, because six more months is not a very long time. This matter may still drag on for more than six months. So is it possible for us to do it in parallel, ie, institute the legal process through the WTO and through the Malaysian legal system? At least, we should register our displeasure with the matter.”
“The Stamp Duties Act was recently amended to allow refund in the following circumstances: (i) the vendor is unable to prove his title to the property; (ii) a purchaser, being a foreign person, is unable to obtain approval under the Residential Property Act (Chapter 274) to acquire or purchase the property; (iii) the property is acquired or is proposed for acquisition by any public authority pursuant to the provisions of any written law authorising or empowering the public authority to acquire land compulsorily; (iv) the purchase of the property is conditional upon permission by the competent authority to develop or subdivide the property and such permission is refused; (v) either vendor or purchaser fails to obtain the approval of any public authority to sell or purchase, as the case may be, the property; (vi) the Commissioner of Building Control makes an order under section 24 of the Building Control Act in respect of the property, ie, the building is unfit for occupation; or (vii) a Strata Titles Board refuses an application for the sale of the property under section 84A, 84D or 84E of the Land Titles (Strata) Act (Chapter 158), ie, rejection of an application for en-bloc sale. If the purchaser aborts the transaction, then the stamp duty is part of the cost for aborting the transaction. This is the intent of bringing forward the payment of the date of the stamp duty. If the seller aborts the transaction, then the purchaser should take legal action to enforce the contract. Nevertheless, stamp duty has been waived on a case by case basis where the purchaser has been able to offer satisfactory evidence that the transaction was aborted due to circumstances beyond his control and was not a speculative venture.”
“I would like to ask the Minister whether there is a possibility of a Free Trade Agreement with China. BG George Yong-Boon Yeo: Sir, China of course represents the greatest Free Trade Area in the world with 1.2 billion people. I do not think it is in China's interest for the time being to enter into an FTA with us. It will of course be in our interest to enter into an FTA with China. As I said earlier, our offer is to everyone in APEC and that includes China. STAMP DUTY ON PROPERTY TRANSACTIONS 2. Dr Wang Kai Yuen asked the Minister for Finance, having brought forward the payment due date of the stamp duty on property transactions as part of the package to deter real-estate speculation, (a) how many of these transactions have failed to complete after the stamp duty has been paid; (b) whether it is equitable for a purchaser to bear the stamp duty of an incomplete transaction resulting from circumstances beyond his reasonable control and (c) will the Government review the procedure to minimize this unnecessary burden on such a purchaser. The Second Minister for Finance (Mr Lim Hng Kiang): Mr Speaker, Sir, there is no requirement for failed transactions to be reported to IRAS. IRAS therefore does not have information on the number of failed transactions.”
“Mr Speaker, Sir, I would like to ask the Minister whether the Government has plans to also extend these FTAs with other countries, besides New Zealand, Mexico and Chile. BG George Yong-Boon Yeo: We have had preliminary discussions with the United States, Australia, New Zealand and Chile on the possibility of a P5 arrangement to liberalise trade among ourselves. And with some other countries, we have also initiated preliminary discussions.”
“On the other hand, the clause is welcomed as it gives the Official Assignee the power to allow genuine businessmen who have failed to try again. Perhaps, I would like to suggest to the Minister of State that there should be some means for the Official Assignee to consult, perhaps, a committee or a panel. This panel can comprise experienced businessmen and professionals who can give their independent judgement and views to any bankrupt who applies to be allowed to start a business or become a director. Therefore, this allows our Official Assignee to get some professional advice on this matter. Sir, I support this Bill.”
“Mr Speaker, Sir, I wish to speak in support of this Bankruptcy (Amendment) Bill. As the Minister of State has said earlier, the proposed amendments are in response to measures to be implemented in support of the Technopreneurship 21 initiative. The main objective is to make it easier for businessmen who have failed and are declared bankrupt to have a chance to recover and start afresh in the shortest reasonable time. To enable technopreneurship to thrive in Singapore, we need to create a more conducive business environment and a climate that is more tolerant to business failures. Hence, people who have failed should be given second, third or even more chances to try again. We know of many successful entrepreneurs who have gone through several trials and failures before they finally succeed. While I am generally in support of the Bill, I would like to ask the Minister of State for some clarification on clause 11. Clause 11 empowers the Official Assignee to give permission to an undischarged bankrupt to act as a director of a corporation or to manage a corporation. My query is on the effective implementation of this power given to the Official Assignee. While I agree that it will be expedient for the power to be given to the Official Assignee to allow a person to restart a business, or act as a director, though he is still an undischarged bankrupt, my concern is how would the Official Assignee be able to exercise good judgement on the suitability of a person to continue running a business. Now, the onus of passing the judgement is on the Official Assignee. If the Official Assignee is too lenient and makes a wrong assessment, he may be allowing a crook or a cheat to restart a business and thereafter he can defraud or cheat new and more victims of their money.”
“Mr Speaker, Sir, I would like to ask the Prime Minister whether this issue of staff support for the President would be helpful because in the past when there was no elected President and there was no need to safeguard the reserves, the President only had one Principal Private Secretary. I am not saying that we should have a full presidential staff, but perhaps some more senior support for him would be helpful in his interaction with the other civil servants who are on a senior level.”
“Hence, I feel that an independent regulatory agency separate from the exchange should play the overseeing and arbitration role. Sir, this merger is one of the recommendations of the Committee on Governance of Exchanges. The Government has accepted or agreed to study many of the recommendations of the Committee. I would like to take this opportunity to ask the Deputy Prime Minister whether the MAS is ready to disclose the results of their study of the various recommendations, and what are the further changes, if any, to be expected of good corporate governance practices or additional disclosure requirements of listed companies on the SES. I now refer to clause 10 of the Bill which governs the proceeds from the sale of shares of the holding company. According to press reports, the proceeds from the opening of the new exchange to more new investors could amount to between $350 million and $380 million. The proceeds are a large sum of money which should be put into a Financial Sector Development Fund. The stated usage is for training and upgrading of the financial industry. This amount of money seems quite substantial. I wish to enquire whether the Government wishes to, besides having the MAS being involved in the management of the funds, allow other fund managers; or perhaps allow some involvement of the exchange in giving its views as to how the funds can be used. And if these funds are ultimately not being fully utilised, would the Government consider putting it to other uses, or putting it into the Government Consolidated Fund? Sir, I wish to conclude by stating once again that I support the Bill. The questions that I have asked are to seek further clarity on the functions and the related issues on the exchange.”