Lim Hng Kiang
Singapore
“The company has made commitments to recycle the ash, and as for renewable energy, the gasification project is not an energy project, it is not a generation company (genco). It is to produce hydrogen and carbon monoxide or, essentially, carbon. Because as feedstock to the petrochemical sector, you need more C and more H2.”
“The Government will continue to recover the IIA awarded if the company fails any conditions or breaches the legislative amendments. I would like to highlight that there are no errant cases in the last five years for IIA and the current amendments are, therefore, not reactionary in nature, but are being made for legislative clarity.”
“In addition, the IIA scheme will be extended till 31 December 2022. Clauses 10 to 13 give legislative effect to this change. The remaining legislative changes arising from our periodic review of the income tax system are either administrative or technical in nature.”
“Data on household and individual savings rates by income groups are not available. However, data on the aggregate level of household financial assets can be obtained from the Household Sector balance sheet compiled by the Department of Statistics.”
“The aggregate level of financial assets owned by Singapore’s household sector6 in each of the past five years is provided in Table 1 below. Data on the amount of financial assets owned by households and individuals in the different income percentiles is not available.”
“The Second Review of the Comprehensive Economic Cooperation Agreement (Second CECA Review) is ongoing. The review is taking some time as both countries have our respective interests to work through, such as in the area of labour mobility. Our agencies regularly engage Indian counterparts to work through issues collaboratively.”
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“Sir, first, let me thank Members for their thoughtful comments. I would like to address some of the key issues raised and then I will ask my Minister of State, Mr Heng Chee How, to help me out in dealing with some of the specific queries and suggestions put up. I think that there are a few things that we all agree during this discussion. First, I think all of us agree that it is very important to nurture our local enterprises. Enterprises create wealth and jobs, and Singapore's economic success hinges on competitive enterprises. Enterprise development is therefore a very key focus of our economic strategy. Dr Ahmad Magad, Mr Gan Kim Yong, Dr Tan Boon Wan, Mr Lawrence Leow, Mr Inderjit Singh and Miss Penny Low have all commented on the need for the Government to better assist and grow the Small and Medium Sized Enterprises (SMEs). I agree that we should help the SMEs, and indeed the Government has been putting a lot of effort and resources to this end. Members have also asked for a single Government agency to champion the cause of the SMEs, and that such an agency be given more resources. Let me, first, explain how we help our local enterprises to grow and convince Members that we are indeed doing quite a lot already. First, how do we grow our local enterprises? There are three dimensions in our strategy, from the general to the specific. The first dimension is that we foster a pro-enterprise environment, so that the enterprises can develop and grow. Second, we provide broad-based assistance programmes, and enterprises can then tap into these programmes depending on their needs. The third dimension is that we develop vibrant industry clusters, and focus the needs based on the specific requirements of the industry clusters.”
“BETTING AND SWEEPSTAKE DUTIES (AMENDMENT) BILL "to amend the Betting and Sweepstake Duties Act (Chapter22 of the 1999 Revised Edition) and to make related amendments to the Singapore Totalisator Board Act (Chapter 305A of the 1999 Revised Edition)�?, recommendation of President signified; presented by Mr Raymond Lim Siang Keat; read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY 2005/2006, and to be printed. ANNUAL BUDGET STATEMENT Order read for Resumption of Debate on Question [18th February, 2005], "That Parliament approves the financial policy of the Government for the financial year 1st April, 2005 to 31st March, 2006.". - [Prime Minister and Minister for Finance]. Question again proposed.”
“The A*STAR Graduate Academy (A*GA) aims to enrol 100 AGS scholars a year. At steady state, 300 to 400 AGS scholars will be studying and working in the laboratories of the various A*STAR research institutes and universities. The majority or 82% of A*STAR scholars are Singaporeans. Foreign-born scholars are given Approve-in-Principle (AIP) Permanent Residence status and are required to take up Singapore citizenship before the completion of their Ph.D programme. A*STAR (Changing of domain name) 17. Assoc. Prof. Ong Soh Khim asked the Minister for Trade and Industry what is the rationale for A*STAR's change of domain name from "astar.gov.sg" to "astar.edu.sg" which can give a misleading impression that it is an educational institute. Mr Lim Hng Kiang: Mr Speaker, Sir, the question is a short one. So the answer will be correspondingly short. The websites of A*STAR and its research institutes may be accessed via both the ".gov" and ".edu" domains. The ".edu" domain name is to reflect A*STAR's mission of fostering world-class scientific research and talent for a vibrant knowledge-based Singapore. It is common practice internationally for research organisations, not just educational institutes, to use the ".edu" suffix or the equivalent. BILLS INTRODUCED SUPPLEMENTARY SUPPLY (FY 2004) BILL "to provide for making supplementary provision to meet additional expenditure for the financial year 1st April 2004 to31st March 2005(both dates inclusive)", recommendation of President signified; presented by the Acting Second Minister for Finance (Mr Raymond Lim Siang Keat); read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY 2005/2006, and to be printed.”
“The NSS Bachelor of Science programme requires scholars to complete their B.Sc in three years for which they are bonded for six years as PSC scholars, during which they will return to Singapore at least once for an eight-week research attachment. On completion of their B.Sc, the scholars return to Singapore to undertake another research attachment of at least one year in an A*STAR research institute. They are then given paid study leave to pursue their Ph.D locally or abroad. They must complete their Ph.D within five years. The academic cost of the three-year B.Sc course amounts to about S$200,000, while the five-year Ph.D portion amounts to about S$400,000. In addition, there are costs such as living and book expenses and other allowances which amount to about S$300,000. In the event that a scholar does not meet A*STAR's stringent academic criteria to continue with a Ph.D, or if a scholar decides that a career in research is not what he or she wants after completing the B.Sc, the scholar is allowed to take up an executive position at A*STAR or at another Government agency. In2003, A*STAR established partnerships with NUS and NTU to set up the A*STAR Graduate Scholarships (AGS) that I mentioned earlier, to provide local Ph.D training for Singaporean undergraduates with 1st class honours for which they are bonded for three years. This Ph.D training lasts for three to four years, and could be followed by a one to two year overseas post-doctorate fellowship at a total cost of S$360,000. In the past, few NUS and NTU graduates were prepared to pursue a Ph.D degree. Due to the active promotion of the AGS programme by A*STAR, NUS and NTU, the number of Singapore students applying for the AGS programme has increased. To-date, there are 115 AGS awardees.”
“Mr Speaker, Sir, the Member has four parts to her Question. So my answer is somewhat long. I seek your indulgence. Today, A*STAR has 1,746 researchers, scientists and engineers (RSEs) in its 12 A*STAR research institutions. Of this, 50% have Ph.D qualifications, and only23% of this group are Singaporeans (ie, Singaporean born or naturalised). Singapore aspires to become a knowledge-based economy. A*STAR supports this aim by providing a diverse and critical mass of local and foreign Ph.D manpower to meet the needs of industry. In order to attract local and foreign companies to stay, expand and set up R&D facilities here, Singapore needs a pool of well qualified local and foreign R&D talent. Since 2001, A*STAR has adopted a two-pronged pro-local as well as pro-foreign talent strategy to build up Singapore's Ph.D human talent, with a target profile of 50% local and 50% foreign Ph.Ds in the various A*STAR research institutes. Today, there are 252 scholars, comprising 195 B.Sc scholars and 57 Ph.D scholars, in the overseas National Science Scholarships (NSS) programme and 115 Ph.D scholars in the local A*STAR Graduate Scholarships (AGS) programme. The overseas NSS programme was launched in 2001, and the local AGS programme was launched in 2003. These programmes will nurture and groom talents for an R&D career by providing research-intensive training for Singaporeans in the various fields of Biomedical Sciences, Physical Sciences and Engineering at top universities and research facilities bothat home and abroad. The selection process for A*STAR scholarship programmes is rigorous to ensure suitability and a long-term fit. Scholar candidates are put through several rounds of interviews, psychometric tests, and assessments.”
“Dr Warren Lee asked the Minister for National Development if he will consider extending the lift upgrading programme to provide more lifts for low-rise walkup HDB apartments at every level and to preserve a ratio of one lift to 30 or more dwelling units by the use of innovative solutions such as having common corridors linking two facing blocks.”
“My response is similar. If you are locked into a three-year period and the rents go up sharply, will you also consider adjusting your rent even though your three-year period is not up? So it must work both ways. Anyway, shopkeepers can opt for shorter tenancies, and HDB and NEA will consider. HDB AND JTC SHOPS (Premature termination of leases) 10. Mr Wee Siew Kim asked the Minister for National Development (a) how many JTC and HDB shops in the pastfive years (2000 - 2004) have either prematurely terminated their leases or suffered a change of lessees before the end of the lease term; (b) how do these numbers compare to the trend of priorfive year period (1995 - 1999); and (c) what are the three main reasons cited for such premature turnover. The Minister of State for National Development (Mr Cedric Foo Chee Keng) (for the Minister for National Development): Sir, HDB shop tenants can exit their business either by terminating their tenancy with HDB or by assigning their tenancy to another operator. There were about 900 terminations and 1,800 assignments between 2000 and 2004. Taken together, terminations and assignments were about 2,700 in the last five years, compared to 500 terminations and 2,300 assignments between 1995 and 1999- taken together, about 2,800. In fact, the number of change in tenants have dropped in the recent five years compared to the previous five years. The three main reasons cited by shop tenants for giving up their shops are:firstly, they are of ageand their children do not want to carry on the business; secondly, they are relocating their businesses elsewhere; and, thirdly, because of poor business conditions. LIFT UPGRADING PROGRAMME (Extension to low-rise walkup HDB apartments) 11.”
“As I have said, we also reduce the rents when rentals come down.”
“Mr Speaker, Sir, asI havesaid, we review our market rents regularly. If Mr Leong Horn Kee is prepared to say that when the rents go up next time, we will undertake a review to raise rents.If he illustrates with this example, and when rents come downwe lower the rents, I will accept his proposition. But, as Members know, one swallow does not make a summer. So we always reviewthe rents and indeed if there is a trend of the rents going down, we will adjust the rents accordingly.”
“In general, the rents and prices for this sector have already fallen in the last few quarters of 2004 and are competitive. For shophouses and markets, HDB and NEA monitor the rentals closely. The rent for each shop and market stall is reviewed whenever the tenancy is due for renewal. Most of the tenancy contracts are short term, up tothree years. Some tenants can even opt for shorter tenancies and have their rents adjusted earlier to reflect the prevailing market conditions. For market and hawker stall holders, rentals have already gone down between 10% and 20% in the last two years. Hence, hawker and market stallholders who renewed their tenancy agreements in the lasttwo years had their rents reduced in line with prevailing market conditions. For HDB shops, the rents have remained fairly stable in the last two years. In addition, to help businesses adjust, existing shop and stallholders who were given rental rebates before 2005 will continue to enjoy half the rental rebates till 30th June 2005.”
“Sir, Mr Leong Horn Kee feels that the market rental in the retail and industrial sectors is depressed. On the other hand, Mr Zainudin Nordin thinks that the property market is showing signs of improvement. Let me use this opportunity to clarify the situation and give an update. First of all, JTC, HDB and NEA periodically review the posted rents and prices for the different land products to ensure that they are in line with prevailing market rates. Current posted rents and prices have been reviewed and adjusted to market. Second, let me give an update on the various property sectors - industrial properties, shophouses and markets. For industrial properties, the occupancy rates of JTC ready-built facilitiesare around 80-81% in the last two years. There is a slight improvement in the second half of last year but, generally, occupancy rates still remain low compared to 2000 and 2001 or compared to the early 1990s. In January 2005, JTC completed its latest quarterly review of industrial land rents and prices. Posted rents and prices for industrial rents were reduced by an average of 20%, and even up to one-third in some areas. This latest round of rate cuts is very significant and will help to lower business costs for SMEs. JTC will continue to monitor our industrial land rent prices and ensure that they are internationally competitive. For ready-built facilities, JTC and HDB also review their rental rates quarterly and peg them to market. In 2004, rental rates for their ready-built facilities were reduced by up to 10%. In January 2005, JTC has also further reviewed its posted rents and reduced the rentals for some estates such as Ayer Rajah, Kolam Ayer, Loyang and Kaki Bukit by up to 6%.”
“Mr Speaker, Sir, can I have your permission to take Question Nos.8 and 9 together as they are related?”
“Mr Leong Horn Kee asked the Minister for Trade and Industry in view of the continuing weak domestic sector and the depressed market rental in the retail and industrial sectors, whether the Government will consider a reduction of the rental rates set by JTC, HDB and NEA for factories, shophouses and markets, as a measure to assist the small retailers and SMEs. 9. Mr Zainudin Nordin asked the Minister for Trade and Industry, with the property market showing signs of improvement, (a) will Jurong Town Corporation (JTC) give an update of the occupancy rate of its industrial spaces; and (b) are the rental rates of JTC industrial spaces competitive and reflective of the current market conditions.”
“Mr Speaker, Sir, I agree with Mdm Ho that our enterprises and people need to have an international mindset and the skills to compete globally. IE Singapore has several programmes to assist businesses in upgrading their capabilities and venturing overseas. Last year, it organised various workshops and seminars on soft skills and capabilities for internationalisation, such as branding, design, manpower, financing and distribution. Staff from over 2,100 local companies attended these conferences. Apart from skills, international experience is also important. The Asian Business Fellowship programme supports local executives to train overseas and develop in-depth knowledge of key markets in Asia. Undergraduates and recent graduates could also participate in student exchange, internship and market immersion opportunities in China and India under this programme. Besides giving the younger generation good academic training, we need to fostera keen spirit of enterprise and innovation. The Ministry of Educationencourages schools to expose young students to a broad range of enterprise-related activities. To give students greater exposure to global realities, more schools are sending their students abroad on community service projects. The universities and polytechnics are also expanding the opportunities for students to do internships overseas or go on exchange programmes with foreign institutions as part of their studies. JTC, HDB AND NEA FACTORIES, SHOPHOUSES AND MARKETS (Rental rates) 8.”
“Sir, this amendment would give PUB greater flexibility in raising funds from the market and allow it to become more efficient in managing its financial strategy. Specifically, the amendment will allow PUB to: (a) raise loans from the Government; (b) raise loans from any source within or outside Singapore, including through the creation and issue of bonds; and (c) make financial agreements for credit facilities for procurement. The proposed amendment to the borrowing provision is in line with the borrowing powers of other statutory boards such as HDB and JTC. The powers to issue bonds and raise loans from the Government are standard provisions for most statutory boards. To conclude, Sir, this Bill will provide PUB greater flexibility in managing its borrowing strategy. Sir, I beg to move. 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. - [Assoc. Prof. Dr Yaacob Ibrahim]. Bill considered in Committee; reported without amendment; read a Third time and passed. UNIVERSITIES (MISCELLANEOUS AMENDMENTS) BILL Order for Second Reading read.4.47 pm”
“It is quite clear. If you are entering into a hire-purchase agreement, you are not the owner. The financier is the owner. So I do not think there is any ambiguity at all. If there are ambiguities, I am also surprised that this was not raised during the consultation period and not addressed. But we would take a look at this. I could not imagine that we are in this business of hire-purchase for cars, there are thousands and thousands of transactions, and such a glaring ambiguity remains in the business. I think that would be a really big surprise to me. But I would get my staff to study this. The way I understood the problem, it is very clear. If you are buying a car on hire-purchase, you are not the owner, you are the consumer. The person who is providing the money is the owner. 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 Lim Hng Kiang]. Bill considered in Committee; reported without amendment; read a Third time and passed. PUBLIC UTILITIES (AMENDMENT) BILL Order for Second Reading read. The Minister for the Environment and Water Resources (Assoc. Prof. Dr Yaacob Ibrahim): Mr Deputy Speaker, Sir, I beg to move, "That the Bill be now read a Second time." Sir, this Bill seeks to amend the borrowing powers of the Public Utilities Board as provided in the Public Utilities Act. Currently, the borrowing provision in the PU Act allows PUB to raise capital from banks and other financial institutions by way of mortgage, overdraft or otherwise. As such, PUB is limited to borrowing from only banks and financial institutions.”
“So, we have the Hire-Purchase Act and other Acts to deal with other critical areas of consumer credit. The example which Mr Yeo Guat Kwang raised about investment-linked products being portrayed differently, I think that comes under the MAS and comes under the financial legislation. So I do not think there is a shortage of rules to deal with all these different products. I do not see the need for an omnibus consumer credit. If there are specific areas or gaps, then I think we should raise this and see where we could deal with it under the various Acts. Miss Penny Low also raised about having greater transparency by introducing a compulsory amortisation table in the Schedule. Again, I would leave this to the market. If it is best practice, if people feel that the template involves setting an amortisation table, so be it, we leave it to the market to decide. This could be their competitive selling point. I do not think it is necessary for us to make it compulsory that we should attach an amortisation table as part of the Schedule. On the question of why we change the notice period from 14 days to 7 days, I do not think repossession would come as a lightning bolt. The person must have not paid up all his instalments, and I am sure the financier would have given him notice. The question is whether the legal notice period ought to be 14 days or 7 days. Our thinking is to make it a decent period. In this day and age, 7 days is enough for people to convey the notice to the person. I do not think you could say that this would come out of the blue. There would be enough notice through the default of payments and through the various communications with the finance company. Miss Penny Low also talked about the ambiguities about who is the owner and who is the financier.”
“First, let me thank the two Members for their support of the Bill. I would like to address the concerns raised, first on the Rule of 78. As we have indicated in the Amendment Bill, the Rule of 78 now is no longer mandatory and our approach is to leave it to the industry to decide how they want to set the terms for early redemption. I think Members would agree that there is no free lunch. When a person takes up a hire-purchase agreement, he is contracting to pay, through a series of instalments, what he has contracted. If he opts for early redemption, then by all counts, there usually would be a penalty clause for early redemption. That penalty clause could either be through calculation of the interest or a very direct penalty clause. So, we leave it to the market to set. It is not true that this is an unlevel playing field. The hire purchase market is a very competitive arena, particularly for car loans, and so I could not believe that the cards are stacked against the consumers. There are many hire purchase credit companies out there and the consumers could choose any one of those companies in the market. Why do we not ban the use of the Rule of 78? I think our approach is just to make it no longer mandatory and leave it to the market to decide whether it is monthly rest, daily rest, actuarial method, or if they want to continue the use of the Rule of 78, we leave it entirely to the market. And, if the consumer does not like that rule set by one company, he can go to another company. The second point raised is whether there ought to be an omnibus consumer credit law. Firstly, I am not convinced that we need an omnibus consumer credit law. Today we have approached this with separate laws for different consumer credit requirements.”
“Mr Speaker, Sir, the Bill updates the provisions in the Hire-Purchase Act relating to the rights and obligations of parties to hire-purchase agreements in the light of significant changes in the retail and credit financing market over the years. It seeks to balance the interests of the consumers and financiers, without undue regulatory compliance costs. The proposed amendments to the Hire-Purchase Act are aimed at improving market efficiency with the removal of a good number of statutory requirements on businesses, enhancing transparency and greater disclosure so as to enable consumers to make informed decisions, lowering legal costs for all and, thus, facilitating a more competitive market environment. Sir, I beg to move. Question proposed.”
“Transparency and disclosure requirements Going forward, to ensure that consumers have the material information they need to make informed choices, financiers will be required to disclose upfront any charges and rates to be levied. Clause 23 also provides an amended Second Schedule of the Hire-Purchase Act which lists the minimum information that financiers should provide to consumers, including the effective interest rate and the method for calculating the balance payable upon early settlement or reassignment. Such information will form part of the hire-purchase agreement. Sanctions and remedies To lower legal costs for both parties, clause 3 provides for Hire-Purchase Act matters to be dealt with in a Magistrate's Court or a District Court instead of having their cases heard in a District Court only. Aggrieved parties can now decide which court they wish to resort to, depending on the circumstances of their case. Criminal penalties for the more serious breaches of the Act, especially those relating to fraudulent behaviour, will be retained. The penalties for these criminal offences will be increased to ensure deterrence under clauses 18 to 21. However, offences which are less serious breaches will be decriminalised under clauses 4, 6 and 14. For the requirements pertaining to clauses 4 and 6, it is already the case today that non-compliance with such requirements under the Act renders the hire-purchase agreement unenforceable until the financier fulfils the specific obligations required. For clause 14, the amendment provides that failure to comply with the requirement will be a breach of contract. These should suffice to ensure compliance with the requirements under the Hire-Purchase Act.”
“Instead, the market will be free to adopt any formula, so long as it is made known to the consumer upfront, ie, at the time of entering into the hire-purchase agreement. Hirer's right to require assignment of hire-purchase agreement In order to help promote a more competitive refinancing market, clause 8 allows a consumer to require the financier to assign the hire-purchase agreement to a new financier, after discharging his obligations as provided for in early settlement. Early settlement, repossession procedures and information provision To improve efficiency, clauses 5, 6, 9 to 13 and 19 provide that the notice periods relating to early settlement, repossession procedures and information provision will be shortened from 14 days to seven business days. This takes into account advances in communications. Limitations on terms charges and interest on overdue instalment payments and minimum deposits To allow for more flexibility in the market, clauses 15, 17 and 23 remove the limitations on the terms charges and interest on overdue instalments payable while clause 16 removes the requirement for a minimum deposit of 10% of the cash price of the goods comprised in hire-purchase agreements. When the Hire-Purchase Act was first introduced, the limitations on terms charges and interest rates were introduced for consumer protection. As the retail and credit financing market has developed since then, we should leave to competitive market forces to set the rates. Similarly, the minimum deposit requirement was intended to curb inflation by restricting credit facilities back then. Circumstances have now changed. We should leave financiers to decide on the need for such a deposit, based on their own risk assessment and propensity to bear risk.”
“First, the Bill now before the House is designed to achieve certain objectives: (1) reinforce disclosure and transparency requirements so that consumers have the material information they need to make an informed choice; (2) balance the interests of consumers and hire-purchase financiers, without imposing excessive compliance costs; and (3) facilitate market developments. This approach is in line with the Government's overall consumer protection philosophy, ie, to promote disclosure and transparency, so that consumers are well-informed and empowered to assume primary responsibility for protecting their own interest. Together with improved efficiency, more flexibility and transparency, the Bill will help to promote a more competitive refinancing market. Scope of application Clause 22 of the Bill increases the cap on the value of consumer goods covered under the Act from $5,000 to $20,000. This brings the Hire-Purchase Act in line with the cap on the value of claims under the Consumer Protection (Fair Trading) Act which came into force in March this year. The existing cap of $55,000 on motor vehicles will not be changed, as it is adequate to cover mid-sized family sedan cars that the majority of consumers buy. Formula for calculation of statutory rebate upon early settlement The Hire-Purchase Act currently mandates the use of the "Rule of 78" formula when calculating the balance payable upon early settlement of the hire-purchase agreement. This restricts the flexibility of the market to provide for other approaches to calculate the loan balance when the loan is redeemed before maturity. Clauses 3 and 9 of the Bill propose that the use of this formula no longer be mandated.”
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Hire-Purchase Act was first enacted in 1969 in response to the growth of hire-purchase transactions in the 1960s. The main objective then was to protect unsophisticated consumers from harsh and oppressive one-sided provisions in hire-purchase agreements, such as exceedingly high interest rates. Except for some minor amendments, the Hire-Purchase Act has remained unchanged since it was first enacted in 1969. However, Singapore's financial market has since evolved. Consumers now have wider choices of financing. They are better educated and more sophisticated. With proper consumer education, they can make informed choices. As regulators, we promote greater disclosure and transparency to ensure that the market can work efficiently. There is, therefore, a need to update the Hire-Purchase Act to align with these developments. In 2003, a joint private and public Taskforce, led by the Ministry of Trade Industry, was formed to comprehensively review the Hire-Purchase Act. The Taskforce included representatives from the Association of Banks in Singapore, the Association of Hire Purchase and Finance Companies, the Automobile Association of Singapore, the Consumers Association of Singapore, the Singapore Business Federation and the Singapore Retailers Association. Based on the Taskforce's recommendations, MTI drafted a Hire-Purchase (Amendment) Bill, and conducted public consultations in May and June this year. We received a number of good suggestions and feedback to improve the draft Bill. These have been incorporated into the final Bill. Key provisions of the Bill Mr Speaker, Sir, let me now take the House through the clauses in the Bill.”
“As an assistance toMembers, SP Services sent out to all MPs the typical utilisation for different household types. So, I am sure all Members, when we receive a case,will look at their bills and, if it is a two-room flat and the bill is on the high side, we try and interview the resident a bit more to find out what appliances they are using which cause them to have such a high bill. I think we do all that regularly in our meet-the-people sessions. SP Services does undertake requests from MPs. As we all know, if we find that the consumption is on the high side, SP Services sometimes goes down toinvestigate to see whether there is a leakage, etc. So, these processes are in place. TAXI DIESEL TAX AND PETROL AD-VALOREM TAX (Review) The following Question stood in the name of Mr Yeo Guat Kwang - 5. To askthe Prime Minister and Minister for Finance in view of the potential further increases in oil price, will the Ministry review the rate of taxi diesel tax and the petrol ad-valorem tax, to ease the adverse impact of escalating oil price on cost of living and business cost.”
“If we look at the process of sending out the reminders and the process of appeals andpayingof instalments, it is a fairly long process. Therefore, if households can manage their budget correctly,there is no reason why disconnection should occur during the examination period.”
“As I mentioned in my earlier reply, there are several agencies on the ground that the residents can approach for help. They can see the CDC and CCC, and many of them do approach their MPs for help.”
“As the hon. Member pointed out, this 40% requirement is a hurdle which our residents have to cross. As MPs, we realise, sometimes, they find difficulty in crossing this hurdle, and that is the reason why thePrime Ministersuggested having a pre-paid card which will allow the defaulter to continue to use, as long as he is able to pay a small amount to his old arrears and pays as he goes along. So, we all agree that the metering system, a pre-paid cash card, is the better way to go. SP Services is trying to roll this out as quickly as possible, but they have to make sure the system is robust. They have to test it out and, therefore, they have to put it on a trial period first, and the earliest they can roll it out is May next year.”
“At the National Day Rally on 22nd August 2004,thePrime Ministermentioned that one way of helping households to manage their electricity consumption was to have a pay-as-you-use scheme. SP Services will roll out a pre-paid meter scheme progressively by May next year. This scheme will be available to HDB households whose electricity supply has been disconnected due to payment default. Under this scheme, prepaid electricity meters will beinstalled at such households' HDB flats. This would assist the households to consume what they can afford to pay and, therefore, prevent their arrears from increasing. SP Services will announce the details of the scheme at a later date.”
“Mr Speaker, Sir, as at June 2004, 9,781 household utilities accounts, comprising0.93% of all household accounts, are in arrears for three months or more. The average period for all accounts in arrears is 1.53 months. SP Services does not disconnect utilities lightly. SP Servicessendsthree reminders within eight weeks after the original bill, if payment is not received. The last reminder is the final notice before electricity is disconnected. SP Services assists consumers with financial difficulties with suitable instalment plans to pay their arrears. If a consumer defaults on his payment plan, SP Serviceswould try to accommodate by arranging a second payment plan.If the consumer defaults on the second payment plan, his electricity supply will thenbe disconnected. If the consumer continues to default on his payment, SP Services would install a "thimble" in the consumer's water pipe to limit the flow of water.If the consumer whose electricity supply has been disconnected reduces his arrears by 40%, SP Serviceswould normally allow reconnection. Any household facing financial difficulties may seek assistance from the CDCs and CCCs. The CDCs administer MCYS schemes, such as the Rent and Utilities Assistance Scheme, and the Interim Financial Assistance Scheme. CCCs also offer localised schemes to assist families who need help with their utility bills. The utility voucher was a one-off programme introduced by SP Servicesduring the economic downturn and the SARS period in July 2003. As at 3rd August 2004, only 5,560 of the 16,800 vouchers, ie, about 33%, were used. There is, therefore, still a significant proportion of the vouchers available for use.”
“Sir, we announced our intention to participate in the scheme some time last year and if you look at the experience of the other APEC economies, it takes aboutone and a halfor almost two years to put in the system. In the light of increased security requirements, we have to make sure that the processes we put in place are robust. In the end, we have to callfor a tenderfor somebody to provide both the security requirements as well as the processes for the card. Unfortunately, all this takes time. HOUSEHOLDS IN ARREARS OF UTILITY BILLS 4. Mdm Halimah Yacob asked the Minister for Trade and Industry (a) how many percent of households are in arrears of their water and electricity bills; (b) what is their average period of arrears; (c) if they are in arrears, what are the circumstances, which will cause Singapore Power to cut off supplies; and (d) whether Singapore Power will re-introduce the voucher scheme to help needy Singaporeans, some of whom are still unemployed or drawing low income.”
“Mr Speaker, Sir, the target is to implement the Asia-Pacific Economic Cooperation Business Travel Card (ABTC) Scheme by the middle of 2005. The Ministry of Trade and Industry (MTI) and the Immigration and Checkpoints Authority (ICA) are currently working out the implementation details of the scheme. These include: (a) translating the requirements imposed by the Scheme into eligibility criteria for Singaporean businessmen who may wish to apply for the card; (b) putting in place an effective and efficient security pre-clearance process for foreigners in other countries applying for the card to enter Singapore; and (c) deciding on an appropriate charging model for the card.”
“Mr Speaker, Sir, as I explained in my answer, the CPI impact is still very moderate for the time being. The overall global inflation situation is still reasonably benign. Energy prices impact only a small component of the overall inflationary picture. So we do not expect the inflationary situation to get out of control. But obviously energy prices can feed to other costs and this will reflect itself in the CPI later on after a lag. On our dependency on oil and other related energy sources, as I explained in my answer, we import everything we use, and this is a long-term strategy that we have undertaken since the 1970s and 1980s to reduce our reliance on oil and other energy sources through diversification, alternative uses and through uses of other modes which are more efficient and to conserve the use of energy. For example, the Ministry of Environment and Water Resources is promoting the use of alternative fuel for cars. Our two biggest uses are electricity generation and transport. For electricity, we have gone to gas and we are looking at other sources. For transport, I think LTA is promoting the use of other modes of public transport as well as other energy sources. APEC BUSINESS TRAVEL CARD SCHEME (Implementation) 3. Mr Ng Ser Miang asked the Minister for Trade and Industry when will Singapore implement the Asia-Pacific Economic Cooperation Business Travel Card scheme which Singapore agreed to join in October 2003 as the scheme will allow Singaporean card holders visa free travel in 15 APEC economies, facilitating business travel between these economies.”
“Mr Speaker, Sir, obviously, one can paint many different scenarios. Mr Leong Horn Kee referred to the article where they postulate a probability of oil reaching US$100 a barrel. But for those who look at the fundamental demand/supply conditions as well as the whole supply chain, they have come to the assessment that there is no shortage, and they estimate that the price reflecting these demand/supply conditions will range between US$38 and US$40 a barrel. But, of course, those are based on fundamental demand/supply conditions. How the market reacts due to expectations and concerns about disruption of supply, this is reflected in both spot prices and future prices. As I have said in my answer, the momentum of growth in Singapore is still very strong. We have had an average of 10% growth for the first half of this year and we are already coming to the end of the third quarter. The numbers for July show that the momentum has been maintained. We are reasonably confident that we should be able to end the year within our growth forecast. If oil prices remain persistently high, even to the level of US$100 per barrel, then the impact will affect us more in the longer term, ie, in 2005 and 2006, and for that we have to monitor and assess it separately.”
“We can best mitigate the impact of higher oil prices by adapting our business practices and lifestyles to improve energy efficiency. For instance, we could turn to the increasing number of energy-saving alternatives when choosing electrical appliances and devices. We could also switch towards transport vehicles with greater fuel economy. These changes in consumption behaviour will only happen, however, if businesses and consumers receive the right price signals. Hence, we should not artificially suppress prices. Instead, we should allow prices to respond to higher energy cost so that demand for oil can be moderated. By doing so, we can continually limit our dependency on oil and reduce our sensitivity to future shocks in oil prices.”
“Hence, recent studies by the Asian Development Bank and International Energy Agency expect only small reductions in Asian GDP growth from the increase in oil prices. For Singapore, the ADB study released in June 2004 estimates that GDP growth this year will be 0.4 percentage point lower due to the increase in oil prices. The ADB projection is similar to estimates by the Ministry of Trade and Industry. In a scenario where oil prices stay at an average of US$45 per barrel from August to the end of the year, GDP growth for 2004 is projected to fall by about 0.4 percentage point below the baseline case. If oil prices are assumed to rise to US$50 and remain at that level to the end of the year, MTI's projection is that GDP growth for the year could be 0.6 percentage point lower than in the baseline case. Most of the negative impact is expected to come from a decline in external demand for Singapore's exports. While the downside risk to Singapore's GDP growth this year has risen recently, the impact of higher oil prices alone is unlikely to result in the full-year growth for 2004 falling below 8% at this point. Preliminary economic indicators for July also continue to indicate that the growth momentum has remained positive. It is still too early to make an accurate assessment on how the economic outlook for 2005 will be affected, when the impact of higher oil prices will be felt. Much would depend on developments going forward, including the trend of crude oil prices. The MTI will closely monitor the situation and update its GDP growth projections, where necessary. The price of oil has shown significant volatility since the 1970s and is likely to remain so for the foreseeable future.”
“Mr Speaker, Sir, higher oil prices affect theSingapore economy in a number of ways. Most directly, it reduces demand for our oil and petrochemical exports as consumers either reduce their usage or turn to alternative products. Other non-oil domestic exports and re-exports can also be adversely affected indirectly if higher oil prices slow down the economic growth in our key trading partners. Oil prices sustained at high levels also affect domestic demand. Consumer sentiments may be hurt and prices of non-oil consumer goods could increase as businesses pass on the higher cost of energy. This is likely to lower private consumption growth in Singapore. Private investments, too, may become more sluggish if businesses believe that energy prices will stay persistently high, thus lowering the profitability of new ventures. The impact on investment may also be greater if interest rates rise with higher inflation expectations. The impact of high oil prices would not be felt equally among the various sectors of the economy. The transport sector would bear a higher share of the price hike initially since fuel enters directly into its costs. The manufacturing sector could also experience greater upward cost pressures due to the higher energy intensity and the reliance on petrochemical products as primary inputs for some of the activities. Nevertheless, much of the impact of an increase in oil prices is expected to be felt only with a time lag. Oil prices have only started rising sharply since April this year, and much of the impact of the recent increase is unlikely to be felt in the current year. The consumer price inflation in Singapore, for instance, remains low in recent months and most major economies have continued to maintain strong growth momentum.”
“Mr Speaker, Sir, may I have your permission to take Question Nos. 1 and 2 together because they are on the same topic?”
“Caring for children is ultimately a partnership involving parents, childcare centres and MCDS. * The number of complaints has increased tremendously after the TNP report (for the months of May and June 2004, we received 46 complaints). VICE SITUATION 22. Mr Ravindran asked the Minister for Home Affairs what actions the police and immigration authorities will take to check the increase in prostitution activities by foreigners in HDB estates, private estates such as Katong, and shopping areas such as Chinatown.”
“Many of the complaints relate to centres not refunding deposit and fees even though they were temporarily shut during the SARS period. Although parents' unhappiness was understandable, the complaints had no direct bearing on the centres' ability to provide good childcare services. Out of the 138 complaints in 2003, only 13 related to inappropriate child management or discipline. This is consistent with the number of such complaints in previous years. For the first half of 2004, 75 complaints have been received*. Of these, 13 are feedback on inappropriate management of children. This increase could be attributed to increased public awareness due to the recent reports on the subject in the media. This is not necessarily a negative trend as the public and parents play an equally, if not more important role in helping to ensure the quality of care in our childcare centres. All licensed childcare centres are required to meet the minimum standards stipulated by MCDS with respect to their operations, environment, safety and hygiene procedures, staffing and programme. All centres are aware of these standards. To check for compliance, MCDS officers conduct unannounced visits to all centres to ensure that these quality standards are met. We have also provided all centres with a copy of the 'Good Practices Handbook', to guide the centres along. Both the child's family and the childcare centre play important roles in a child's development. MCDS has therefore been actively encouraging childcare centres to continually develop strategies to involve families and work closely with them. Parents too, should recognise that they can make valuable contributions, through monitoring their children's development and progress in the centres.”
“That this Parliament, in accordance with Article 144(1)(a) of the Constitution of the Republic of Singapore and section 3(1) of the Local Treasury Bills Act (Chapter 167 of the 2002 Revised Edition), resolves that the Minister for Finance be authorised to borrow, by the issue of Treasury Bills in Singapore under that Act, a further sum not exceeding Ten Thousand Million Singapore Dollars (S$10,000,000,000), thereby in total a sum not exceeding Thirty Thousand Million Singapore Dollars (S$30,000,000,000). ADJOURNMENT Resolved, "That Parliament do now adjourn to a date to be fixed." - [Mr Mah Bow Tan]. Adjourned accordingly at Sixteen minutes to Five o'clock pm to a date to be fixed. WRITTEN ANSWERS TO QUESTIONS FOR ORAL ANSWER NOT ANSWERED BY 3.00 PM COMPLAINTS AGAINST CHILDCARE CENTRES 21. Dr Lily Neo asked the Minister for Community Development and Sports as there are about 138 complaints against childcare centres last year, the number of which is more than double that of 2002, what actions have been taken by his Ministry to curb the trend. Assoc. Prof. Dr Yaacob Ibrahim: As at 1st June 2004, more than 40,000 children are enrolled in 667 childcare centres in Singapore which provides more than 55,000 places. I would like to assure Members that as the licensing authority for childcare centres, my Ministry gives our highest priority to the safety and best interest of children. MCDS would take action against any child care centre that is found to be negligent or carrying out inappropriate practices. Such action can range from the issue of written warnings to termination of the childcare centre licence. The majority of the 138 complaints received in 2003 concerned administrative issues arising from centre closure due to SARS.”
“Sir, on 25th September 2001, Parliament resolved, in accordance with section 31 of the Local Treasury Bills Act (Chapter 167, 1988 Revised Edition) that the Minister for Finance be authorised to borrow by the issue of Treasury Bills in Singapore a revolving sum not exceeding $20,000,000,000. As at 31st March 2004, the outstanding amount of Treasury Bills issued is $18,000,000,000. There is a need to raise the limit. The small issue size of the three-month Treasury Bills is hampering trading activities in the short end of the Singapore Government Securities curve as most of the Treasury Bills are locked up as minimum liquid asset requirements of financial institutions. The average issue size of three-month Treasury Bills is about $950,000,000, which is smaller than the average issue size of around $2-$2.5 billion for the longer term securities, and the average daily trading volume of Treasury Bills in 2003 was only $161,000,000, compared to $2.5 billion for Singapore Government Securities. To meet the market demand and to support capital market development efforts, the Monetary Authority of Singapore will gradually step up the Treasury Bill issue. I propose therefore that the current ceiling for borrowing by Treasury Bills of $20,000,000,000 be raised by another $10,000,000,000 to a total of $30,000,000,000. This ceiling will apply to the outstanding amount of Treasury Bills. Parliament is requested to enable the Government to issue the Treasury Bills up to a total amount not exceeding $30,000,000,000. Question put, and agreed to.”
“As I explained, when they made the amendments to section 188, that amendment was correct. But they did not realise that section 189 also referred to section 188. Therefore, when you now allow members to have access to the minutes of meetings, and section 189 says that minutes of all meetings are also covered in section 188, then it also includes all the other meetings like the directors' meetings and management meetings. That was how the oversight came about. So it was just the drafters' error in not detecting that when they made amendments to section 188, they should check what were the other references to section 188 which also had these consequential amendments. 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 Lim Hng Kiang]. Bill considered in Committee; reported without amendment; read a Third time and passed. TREASURY BILLS (Motion) The Second Minister for Finance (Mr Lim Hng Kiang): Mr Deputy Speaker, Sir, I beg to move, That this Parliament, in accordance with Article 144(1)(a) of the Constitution of the Republic of Singapore and section 3(1) of the Local Treasury Bills Act (Chapter 167 of the 2002 Revised Edition), resolves that the Minister for Finance be authorised to borrow, by the issue of Treasury Bills in Singapore under that Act, a further sum not exceeding Ten Thousand Million Singapore Dollars (S$10,000,000,000), thereby in total a sum not exceeding Thirty Thousand Million Singapore Dollars (S$30,000,000,000).”
“Mr Deputy Speaker, it was indeed an error and an oversight. What happened was that when we put up the draft Bill for public consultation, everything was in order. But later on, when we took in the feedback from the various comments, there were some amendments to the various sections and, in particular, the drafting error came about when section 188 was amended as part of the amendment Act to require a company to keep minute books containing all resolutions passed by written means, declarations and resolutions made by the company. Then a subsequent amendment was also made to section 189, and in that amendment, it required certain documents kept in the minute books to be made available to shareholders for inspection or purchase. However, because section 189 also made reference to section 188, therefore an unintended result of the amendment was that section 188 now required the company to also make available for inspection by any member minutes of all proceedings of general meetings as well as meetings of the directors and managers. So that was how the mistake was made.”
“Mdm Halimah Yacob asked the Acting Minister for Health when will the Medical Service Package which was recently introduced for treatment of cardiac cases at the restructured hospitals be extended to other medical procedures such as renal, stroke or neurology cases. 18. Mdm Halimah Yacob asked the Acting Minister for Health in view of the rising cost of medicines (a) what measures are being taken to ensure that the cost of medicines dispensed at public hospitals and outpatient clinics remains affordable; (b) what are the criteria for determining whether a particular medicine is standard where there is a subsidy or non-standard where there is no subsidy; and (c) will the hospitals consider charging patients attending outpatient clinics for follow-up treatment the same rate for medicines as when they were treated as subsidised patients in the hospital.”
“The Tote Board readily agreed and decided that it would contribute up to 25% of the annual NMRC expenditure on medical research, subject to a cap of $5 million per year. The working arrangement is for the Ministry of Health to justify its research needs to the Finance Ministry, when it seeks its annual budget from the Government. NMRC will then fund its activities from the MOH's budget allocation. Separately, the Tote Board will reimburse the Ministry of Health with 25% of the actual research expenditure incurred by NMRC in the previous year, subject to the $5 million cap. Upon receipt of the reimbursement, the Ministry of Health should have taken it in as revenue, thus offsetting part of NMRC's expenditure, in line with the donor's intention. However, the Ministry of Health did not do so. It only took in part of the donation as revenue, but retained the rest in a deposit account. As a result, the Tote Board reimbursements have accumulated in the Ministry of Health's deposit account to $29 million when the Auditor-General discovered the discrepancy last year. The Ministry of Health has made a mistake by not taking in the entire reimbursement as revenue. After the error was pointed out by the Auditor-General, the Ministry of Health has correctly taken in the $5 million reimbursement received in 2003, while trying to properly resolve the $24 million accumulated in the previous years. The Permanent Secretary has apologised to the Tote Board for this mistake. The Ministry of Health has also resolved the accounting treatment for the remaining $24 million with the Attorney-General and returned the amount to the Finance Ministry. AFFORDABILITY OF MEDICINES AND MEDICAL SERVICE PACKAGE 17.”
“The Ministry may first pay from its own funds to meet some expenditures before claiming reimbursements from the donated funds and channelling them back to the Government. The donations were, in fact, from the Totalisator Board. It is an example of the Government being reimbursed for expenses which should partly have been borne by the donations, but had been paid for using the Ministry's funds in the first instance. The Acting Minister for Health would deal with the details of this case in his reply to Dr Wang. Let me mention, however, that not all donations are made with a specified purpose. In some cases, donations or gifts of money are made outright to the Government, ie, the Government is named as the beneficiary. For these cases, the donated funds are credited directly to Government revenue. And provision for expenditure will then be made in the annual budget estimates of the Ministries. PUBLIC DONATIONS HELD BY MINISTRY OF HEALTH 16. Dr Wang Kai Yuen asked the Acting Minister for Health why are public donations to his Ministry for health science research and development being transferred to the Treasury. The Acting Minister for Health (Mr Khaw Boon Wan): Mr Deputy Speaker, Sir, let me first clarify that the donations were not from the general public, but came from one donor, the Singapore Totalisator Board (Tote Board). In 1994, the Ministry of Health (MOH) set up the National Medical Research Council (NMRC) to coordinate and fund medical research in public hospitals. NMRC is funded by the Government out of MOH's annual budget. In 1996, the Ministry of Health asked the Tote Board to help fund the NMRC so that we have additional money for research.”
“Dr Wang asked about the basis for donated funds held by the various Ministries to be reverted to the Treasury and Ms Indranee Rajah asked how reverted funds would be dealt with by the Treasury. Let me first assure the House that all donations by the public are spent on the purposes specified by the donors. The Government does not channel any donation to other uses without the permission of the donors. Under our current guidelines, all donations received by a Ministry for a specific purpose have to be placed in a deposit account. This money cannot be considered as revenue to the Government and can only be used for the purpose specified by the donors. If there are surplus funds left over after the project or programme has been completed, the Ministry should return these funds to the donors, or seek their consent to use the funds for other purposes. The Ministry cannot transfer these surpluses to the Government's Consolidated Fund. Hence, in the case of the Ministry of Home Affairs' Central Narcotics Bureau (CNB), the CNB is currently awaiting approval from the donor to expand the scope for the use of the remaining funds. Should this be turned down, the funds will be returned to the donor. Likewise, the Ministry of Community Development and Sports has sought the approval of its donors to return the unused funds or to use them for future campaigns of a similar nature. Dr Wang and Ms Rajah were probably referring to the donations for health science research and development being transferred to the Treasury. The situation there is different. The donations were tied to the total expenditure of the research programmes as specified by the donors.”
“Sir, can I have your permission to take Question Nos. 14 and 15 together?”
“I guess that was the question coming. As Members can see, we try our best to refund the money. So some of these cases would have been very long outstanding. And there are no laws which allow us to pass on the money to charity. PUBLIC DONATIONS HELD BY MINISTRIES 14. Dr Wang Kai Yuen asked the Deputy Prime Minister and Minister for Finance what is the basis for funds donated by the public and held by the various Ministries to be reverted to the Treasury. 15. Ms Indranee Rajah asked the Deputy Prime Minister and Minister for Finance in relation to the public donations held by the Ministries of Health, Home Affairs and Community Development and Sports which are to be paid over to the Treasury, how will these funds be applied or dealt with by the Treasury after it receives them.”
“He can pose a Question, and if DPM is around, he can answer it. TOURISM REVENUE (Measures and programmes to arrest decline) The following Question stood in the name of Mdm Ho Geok Choo - 12. To ask the Minister for Trade and Industry in view of the Singapore tourism landscape seeing challenges marked by safety and security threats as well as intense competition from and investment to regional destinations, what measures and programmes are being planned and administered to arrest the decline in tourism revenue in Singapore.”