Mah Bow Tan
Singapore
“The previous generation of Singaporeans overcame huge odds together to create this improbable nation which we call home. Let this generation work as one to define our country for the next lap of our journey. Sir, on this note, I fully support the amended Motion. Page: 143”
“Like all upgrading programmes, there is a certain budget, and a certain pace at which we will build. We have completed the LUP and now we are going on towards the HIP. The Estate Upgrading Programme (EUP) is ongoing.”
“For those who cannot afford home ownership, we will provide rental flats. For the rest where there is hardship involved, that is where the safety net comes in. I do not think we should make the safety net so wide as to bring in everybody.”
“Building a studio apartment is no different from building any other HDB flat. If a person applies now and the building works start now, he can get it in two-and-a-half years to three years. We have stepped up the building of studio apartments over the last couple of years.”
“Mdm Halimah Yacob asked the Minister for Health (a) how many people have signed an Advance Medical Directive (AMD) and how many have revoked them since; and (b) whether there is a need to review the current rules on AMDs which do not require a person who has revoked the AMD to inform the Registrar, thus causing uncertainty for hospitals t…”
“Parents who wish to exert more control over the maximum mobile service charges incurred by their children may consider service options such as mobile pre-paid cards. IDA is aware of the public's concerns on mobile subscriptions, and will continually review policies and look into measures to further protect the interest of consumers.”
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Every one of 3,030 lines we hold for Mah Bow Tan, in date order, each linked to its source. Free to read, in full, without an account. Page 28 of 61.
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The current Planning Act came into effect on 1st April 1998. This Bill is to introduce some amendments to the existing Act to enable a more equitable sharing of any value enhancement arising from the alteration of the Master Plan for sites in the future. The amendments will also strengthen the legal framework to facilitate development control and to make the current process more pro-business. I shall now explain the rationale for the main changes. Revised definition for Development Baseline One of the main changes to the Planning Act is the redefinition of the development baseline to make it more relevant to today's context. The Development Baseline refers to the base value above which Development Charge is payable. The Development Charge (or DC) is a tax levied when the value of land, resulting from the State authorising a development proposal on it, exceeds the base value of the land. The current Development Charge rate is 50% of this land enhancement value. Under the current Planning Act, the base value of a piece of land, ie, the Development Baseline, is determined by comparing the values of the following three items: (a) the 1958 Master Plan baseline; (b) the 1980 Master Plan baseline; or (c) the approved development baseline. The highest of the three values derived will be the Development Baseline. The Master Plan 58 and Master Plan 80 baselines have been included in the baseline definition due to historical reasons. The proposed amendment in clause 12 is to delete the first two items in the definition, ie, the 1958 and the 1980 Master Plans.”
“The removal of the constraint will enable URA to adopt more optimal risk-return investment portfolios. Finally, clause 5 introduces the power to compound offences under the URA Act and its regulations. This is to give URA the discretion to compound offences under the URA Act where it is not sufficiently serious to warrant prosecution. The power to compound offences shall only be exercisable in relation to offences which are prescribed by URA, with Minister's approval, as a compoundable offence. 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. - [Mr Mah Bow Tan]. Bill considered in Committee; reported without amendment; read a Third time and passed. PLANNING (AMENDMENT) BILL Order for Second Reading read. 3.35 pm”
“URA has since the middle of 1980s been one of the main agents that sells state land on behalf of the Government for the purpose of development under the Government land sales programme. This function has enabled URA to better realise the land use planning objectives of sites slated for development. The development of Marina Centre as a major business, hotel and convention area, the development of Tanjong Rhu for quality private housing and the revitalisation of the conservation districts and the China Square area are all examples of successful implementation of land use planning objectives through URA's land sales activities. Apart from the Government land sale programme, URA has, on occasions, sold land for development on behalf of other statutory boards or Government departments. The amendment recognises URA's function in selling land as agent for the State and other statutory authority for purposes of development. Sir, I shall now move on to the other amendments in the Bill. Clause 2 of the Bill raises the maximum number of URA's Board members (excluding the Chairman) from 8 to 12. This will allow more URA Board members with different expertise and qualifications to be appointed to help URA to address the needs and concerns of the various sectors of the economy and of the public. Clause 4 of the Bill seeks to remove the constraint of the Trustees Act on URA's investment powers. Today, URA may invest its funds in securities in which trust funds may, under the Trustees Act, be invested. The amendment will allow URA, with the Minister's approval, to invest its funds in such manner as it thinks fit and to manage or hedge against financial risks involved in such investments.”
“Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The main purpose of this Bill is to update the Urban Redevelopment Authority's function in the Act to reflect its role as the national land use planning authority and as land sales agent for the State and other Statutory Boards for purposes of national development. This updating of URA's function is to formally recognise URA's contribution in these two key areas of national development. Sir, let me explain the background of URA's role in undertaking these functions. The present URA was formed in September 1989 with the enactment of the current Urban Redevelopment Authority Act, which effected the merger of the old Urban Redevelopment Authority with the former Planning Department and the former Research and Statistical Unit of the Ministry of National Development. As a result of this merger, URA took over from the old Planning Department the overall task of control and management of land planning and development control as well as advising the Government on these matters. These planning functions were not explicitly included in the URA Act at that time. Today, it is well-established that URA is the statutory authority charged with the responsibility of land planning and development control. As such, it is timely to recognise this key responsibility as part of URA's functions. The amendments provide that the URA shall (a) undertake land planning and manage and control the development of land in Singapore; and (b) inform and advise the Government on matters related to land planning and the development of land in Singapore. In addition, the Bill updates URA's role as a land sales agent for the State and other Statutory Boards.”
“5% as a direct result of liberalisation, if oil prices had remained constant. This has already been passed on to all consumers, contestable as well as non-contestable. SINGAPORE ARMED FORCES TRAINING CASUALTIES 2. Mr Steve Chia Kiah Hong asked the Minister for Defence if he will provide a breakdown of yearly statistics, from the inception of the Singapore Armed Forces to date, on (i) the number of training deaths per year; (ii) the number of injuries that resulted in loss and/or impairment of functions of bodily parts; and (iii) the number of servicemen who were hospitalised for more than three days per year due to training accidents. RAdm Teo Chee Hean: MINDEF has compiled the figures for number of injuries, and deaths due to training for the last 10 years. Over the past 10 years, an average of 3.7 deaths each year is attributable to training. Between 1994 and 1998, there were 21 deaths attributable to training. There were 16 deaths between 1999 and October 2003. Between 1994 and October 2003, there were 3,703 cases of injuries from all causes. This figure includes injuries not caused by training. For 2003, there were 256 injury cases of which 196 were training related. MINDEF's database captures data on hospitalisation since 2000. Based on our records for the past 4 years, an average of 8.6 servicemen were hospitalised each month due to medical conditions attributable to training. The available data does not differentiate between hospitalisation for periods of less than as compared to more than 3 days. APPENDICES”
“BG George Yong-Boon Yeo: Retail competition, or electricity tariff liberalisation, takes place when a consumer can choose to buy electricity from any retailer who can provide the best deal. These customers are known as contestable customers. Contestability has been implemented in phases to ensure a smooth transition. About 250 consumers with electricity demand of 2 MW and above became contestable in July 2001. These consumers are the very large industrial and commercial consumers who together represent 40% of total electricity demand. Another 5,000 consumers with an average monthly electricity consumption of above 20,000 kWh became contestable over the period June 2003 to September 2003. These are large industrial and commercial consumers, many of whom are high-tension consumers. These 5,000 accounts together represent 30% of total electricity demand. The remaining 5,000 large industrial and commercial consumers with an average monthly consumption of 10,000 kWh and above will be released into contestability from December 2003 to mid-2004. These 5,000 accounts together represent 5% of total electricity demand. By mid-2004, 75% of total electricity sales in Singapore will be opened to retail competition. The remaining 1.1 million domestic and small non-domestic consumers have an average monthly consumption of less than 10,000 kWh, i.e. a bill size of less than $1,600 per month. Together, these 1.1 million accounts make up 25% of total electricity sales. EMA is studying how best to introduce retail competition for these accounts. EMA targets to complete its study by early next year. Even without retail competition, the benefits of liberalisation and competition at the wholesale level have led to a reduction in electricity prices. Tariffs would have fallen 9.”
“The Park Connector Network (or PCN) is a nation-wide green network to connect major parks together so that there are more recreational opportunities for walkers, joggers, and cyclists. As at October 2003, 22 stretches of park connectors, totaling 52 km have been developed. Currently, 20 park connectors are under construction, or in the design and planning stage. NParks targets to complete 45 km of park connectors over the next 3 years. The Park Connectors run mainly along drainage, road and rail reserves, and coastal promenade, and involved different land ownerships. The timing of their development is coordinated with the development programmes of these agencies. NParks has committed to accelerating its park connector development programme, from an average of 9 km/year in the past to 15 km/year over the next 3 years. This requires not only additional financing and manpower resources, but also close co-ordination with other Government agencies. At the same time, NParks is also working on improving the connectivity (such as crossings) for the PCN. The additional crossings will allow for a more comprehensive and continuous green network linking parks with town centres, MRT stations, sport complexes and homes. WRITTEN ANSWERS TO QUESTIONS ELECTRICITY TARIFF 1. Mr Leong Horn Kee asked the Minister for Trade and Industry if he will give (a) an update on the status of the electricity tariff liberalisation programme currently undertaken by the Energy Management Authority (EMA); (b) details on the sectors which have been made contestable; and (c) the future plans on the remaining sectors to be allowed to be become contestable, such as the domestic electricity sector.”
“Mr Deputy Speaker, Sir, I beg to move, That Parliament do now adjourn. Question proposed. COST OF EZ LINK CARDS 6.01 pm”
“The profile of the 35,400 HDB households who may not have enough CPF Ordinary Account (OA) and Special Account (SA) contributions and balances to service their HDB housing loans beyond one year is as follows: (a) 89% have monthly household income of $2,000 or less; (b) 23%, 44% and 24% stay in 3-room, 4-room and 5-room flats respectively; (c) 66% have an outstanding mortgage loan of $150,000 or less; (d) 58% have a loan repayment period of 20 years or less; and (e) the average monthly instalment is $660, while the average monthly cash top-up required is $500. Column No : 3249 EFFECTS OF REDUCTION FROM CENTRAL PROVIDENT FUND 4. Mr Low Thia Khiang asked the Acting Minister for Manpower if he will release data showing the effect of the reduction in Central Provident Fund contribution to 30% on the 10th to 90th percentile of workers, at 10 percentile intervals, on their ability to meet their housing, mandatory Medisave and retirement needs as well as on the balance in the Ordinary Account.”
“In the latter, counselling provided by a full-time counsellor and/or volunteer paracounsellors as well as a programme of voluntary religious services, education and art and craft training provide for the rehabilitation of the AWOL offenders. These are aimed at changing the values, attitudes and behaviours of the AWOL offenders as well as helping them to acquire new lifeskills so that they do not have to resort to AWOL again. Parents are also encouraged to help in this rehabilitation process by visiting them in the Detention Barracks and giving appropriate support and encouragement. Column No : 3247 WRITTEN ANSWERS TO QUESTIONS Column No : 3247 MURDER OF SINGAPORE STUDENTS IN SYDNEY 1. Mr Chiam See Tong asked the Minister for Home Affairs (a) whether the Australian Police have to date released to the Singapore Police any information in relation to the investigations on the murder of two Singapore students studying in a university in Sydney on 15th September 2003, and if not, (b) whether the Singapore Police will approach its Australian counterpart for the information.”
“Those with severe psychological problems may be referred to the SAF psychiatrists. In addition, they attend weekly religious services conducted by volunteers from approved religious organisations and receive weekly visits by their parents and significant others such as girlfriends. As part of their overall rehabilitation plan, they are also given opportunities to further their education by studying for their N, O or A levels. Servicemen sentenced to detention are also given emotional support and guidance as well as taught other AWOL-avoidance skills. Volunteer paracounsellors visit them in the Detention Barracks to befriend them, establish rapport and help to prepare them for their eventual release. Upon their discharge from detention, paracounsellors will assist them in their transition and help them to readapt to military life. (c) Yes, the basic philosophy adopted by the SAF in the management of military offenders, including AWOL offenders, is similar to the "Restorative Justice Model" of the Juvenile Court of Singapore. Specifically, it is aimed at returning the offender to the SAF to resume his military training and/or duty and, ultimately, to reintegrate him to society as a useful and responsible citizen. There are two aspects in this model, viz, deterrence and rehabilitation. In the former, the offender is held accountable for his misconduct of committing AWOL and the punishment meted out must be a sufficient deterrent to him to not re-offend as well as to other potential offenders. Hence, the period of incarceration, tough regime and physical training in the SAF Detention Barracks are aimed at achieving deterrence.”
“Public housing in Singapore is heavily subsidised for long-term owner occupation. HDB flat owners who wish to sell their flat in the open market can do so after they have met the minimum occupation period (MOP) of their flat. The MOP requirement ensures that HDB flats are not purchased for speculation and prevents a premature realisation of the housing subsidy by the flat-owner. Nevertheless, we recognise that there may be flat owners who are in severe financial hardship and have no choice but to sell their flats and downgrade to a smaller flat. HDB has waived, and will continue to waive, the MOP requirement for flat owners in genuine financial hardship on a case-by-case basis, based on individual merit. Column No : 3245 ABSENCE WITHOUT LEAVE BY FULL-TIME NATIONAL SERVICEMEN 32. Ms Braema Mathiaparanam asked the Minister for Defence (a) what is the rate of repeat offence among full-time National Servicemen who go on absence without leave (AWOL); (b) what is the nature of the counselling they receive; and (c) whether this approach is in line with counselling schemes under the Restorative Justice Programmes introduced in 1995 for juvenile crimes. RAdm Teo Chee Hean: (a) In 2002, a total of 358 full-time National Servicemen were sentenced to detention for the offence of AWOL. Of these 358 servicemen, 203 were repeat offenders. In other words, based on an average strength of about 30,000 full-time National Servicemen, the AWOL rate in 2002 was about 12 in 1,000. Of these 12, approximately 7 were repeat offenders. (b) Full-time national servicemen convicted of AWOL are given individual counselling, group-based programmes and a befriending service by volunteer paracounsellors trained by the SAF Counselling Centre, where appropriate.”
“They can rent a 1- or 2-room flat from HDB at highly subsidised rates under the Public Rental Scheme if their monthly household income does not exceed $1,500. Alternatively, they can rent a 3-room flat from HDB under the Rent and Purchase Scheme, and subsequently buy over the rental flat when their financial position improves. Column No : 3243 MANDATORY PERIOD FOR DOWNGRADING OF FLATS 21. Mr Ahmad Mohd Magad asked the Minister for National Development if he will consider reviewing the mandatory waiting period for current HDB dwellers who wish to downgrade their flats, given the current economic situation.”
“A fundamental objective of the Government's public housing policy is to encourage home ownership. To do so, HDB flats are priced affordably and housing loan schemes are made available. For low-income families, the Government assists them to own their homes through the Special Housing Assistance Programme. The schemes under this programme include the Low-Income Family Incentive Scheme, Sale of Flats to Sitting Tenants Scheme and the Rent and Purchase Scheme. Flat buyers under these schemes were previously exempted from credit assessment. They were granted mortgage loans of up to 100% of the flat purchase price. This had led to some households buying flats beyond their means and subsequently falling into arrears. To encourage greater financial prudence, HDB has decided with effect from 1st October 2003 to extend credit assessment and to cap the mortgage loans for this group of flat buyers taking HDB concessionary loans. They will also be given financial counselling. These prudent measures will ensure that low-income families buy flats when they are financially ready, and not over-commit themselves. The impact of the changes is expected to be minimal. Based on HDB's data on the 700 low-income households who bought flats under the various housing schemes in the first half of 2003, the large majority (94%) of them would still qualify for a HDB concessionary loan even with credit assessment. About 60% of the flat buyers would obtain the same loan quantum, while 34% of them would have to take a lower loan quantum. Only about 6% would not be eligible for a HDB loan. HDB will assist low-income households who are not financially ready to buy a flat to find affordable alternative accommodation.”
“The conversion to the new Scheme would not give rise to any increase in salary of the five incumbents. We are also following the other schemes in the civil service by dropping the reference to "superscale" grades. All the staff under the new scheme will be known as Parliamentary Officers. They will be eligible for annual merit increments if their performance exceeds the requirements of their grade. Any Parliamentary Officer can go up to the apex of the scheme, ie, Grade 7, but he will not automatically be the Clerk of Parliament unless he is so appointed. The Commission, having considered the Parliamentary Scheme (2003), has advised that this new scheme be applied to officers in the Parliamentary Service, which is at present pegged to the Senior Officer Scheme. The recommendation of the Commission is contained in paragraph 10 of the Report. The House is asked to accept the recommendation of the Commission. Madam, I beg to move. Question put, and agreed to. Resolved, That this Parliament, noting the Report of the Commission on Parliament Staff as contained in Paper Misc. 5 of 2003, accepts the recommendation of the Commission as contained in paragraph 10 thereof and resolves in accordance with such recommendation. ADJOURNMENT Resolved, That Parliament do now adjourn to a date to be fixed. - [Mr Mah Bow Tan]. Adjourned accordingly at Fourteen Minutes to Seven o'clock pm to a date to be fixed.”
“Mdm Deputy Speaker, I beg to move, That this Parliament, noting the Report of the Commission on Parliament Staff as contained in Paper Misc. 5 of 2003, accepts the recommendation of the Commission as contained in paragraph 10 thereof and resolves in accordance with such recommendation. Madam, in accordance with Article 51(6) of the Constitution of Singapore, a Commission consisting of the Speaker, the Deputy Prime Minister and Minister for Finance, the Leader of the House, the Acting Minister for Education and the Chairman of the Public Service Commission was set up to consider a proposal to adopt a new Parliamentary Scheme (2003) for officers in the Parliamentary Service. The Commission has presented its Report to Parliament on 15th August 2003. The Commission noted that the Management Executive (MX) Scheme was implemented in the civil service on 1st January 2002 to meet the challenges of new technologies and innovations emerging every day and rising public expectations. The MX Scheme was introduced to carve out a meaningful and rewarding career in the civil service, as an officer can enjoy performance-based pay, clear and timely progress and self-directed career development. Under the present Senior Officer Scheme, the salary scale comprises an annual fixed increment together with the basic salary, the monthly variable component (MVC) and the non-pensionable component (NPC) and does not include the non-pensionable variable payment (NPVP) (NWC wage adjustments) and non-pensionable variable payment (salary revision). Whereas under the new Management Executive Scheme (MXS), the salary range, which is based on performance, includes all the above components, thus showing the gross salary that an officer draws.”
“I hope I have answered the questions raised by Dr Teo. Mr Chiam asked two questions which are unrelated to the Act in question but, nevertheless, I would try and explain. There is a fee that is levied on the submission of building plans. Mr Chiam mentioned $2,600. I am not exactly sure whether this is a flat fee. I think it varies, depending on the complexity of the plans. This fee is to compensate the authority, ie, the public sector agency, for the costs incurred in processing the plans. As he may know, a building plan is a highly complex document. In fact, it can be quite voluminous. It involves many different agencies, from roads to drainage, to fire safety, to structural safety, conformance with environmental requirements and so on, and so forth. It involves many different agencies, although we have tried to streamline the process by having a one-stop submission facility. Nevertheless, even though it is a one-stop submission, many different experts and professionals are involved in processing the plan. So, the costs that are incurred are not insubstantial. In fact, if you add up all the manpower costs involved, you will find that the fee barely covers the costs. Why is the fee still levied, even if the plans are rejected? It is because the work has already been done. When the plan is processed and it does not meet the requirements, ie, it is rejected, it does not mean that you return the plan. If that were the case, everybody just submits any plan and just hopes for the plan to be rejected, or, worse still, for the agency to point out where the shortcomings are in the plan, tell them, return the plan with the notes as to how to rectify them and then after that, get its feedback as well. I think that is really asking a bit too much.”
“What we are doing now is to facilitate this and to make sure that we remove any impediments in the Acts which currently do not allow design and build arrangements to be carried out in the private sector. I would like to thank Dr Teo for his support for this amendment to facilitate this arrangement. The third point he made was about the powers of the Commissioner of Building Control. He asked why there is a need to engage an expert for investigation and for testing major buildings. As I mentioned in my speech, this is mainly for investigation and testing on major and complex structures and buildings which show serious design or structural faults or distress, which may lead to catastrophic consequences. It is in such circumstances that we reckon that the investigations can be highly complex and technical in nature. This is why we are providing for the Commissioner to have the ability to engage another expert to seek a second opinion. Not only that, it is to make sure that the costs so incurred do not land with the public sector, but with those who are responsible for such an investigation to be conducted in the first place. What the expert would do is to be an adviser to the Commissioner. He will assess the situation. He will investigate. He will check on the adequacy of the works, both the current works and also the proposed rectification works and will give an expert advice to the Commissioner. Of course, the owner or the developer can also similarly engage an expert but, ultimately, what the Commissioner would have to approve are the qualified person's recommendations. It is an important provision because, as I have said, the consequences of such distress or shortcomings may be catastrophic. It is erring on the side of caution to seek this second opinion.”
“The duties and responsibilities of the design QPs are adequately defined. The engagement of a second QP to certify alternative solutions is meant to address this issue of expertise. As to the question of transfer of risks and liabilities between the authorities and the building professionals, I wish to assure him that there is no transfer of risk. Currently, the design QP has the statutory duty to comply with the prescriptive solutions under our current building regulations. Under the performance-based system, his statutory duties are unchanged. They remain the same. But as Dr Teo has rightly pointed out, this is something new for the local industry. I expect that the local industry and the local professionals will take time to get used to the idea, and also to build up the expertise, experience and the confidence to try out this new system. What BCA can do will be to promote the system by organising seminars, answering queries through workshops, explaining the implementation details to the professionals. Hopefully, if we can allow some of the professionals to take this performance-based approach, and in the process, come up with more innovative solutions which will give them more flexibility and, at the same time, reduce costs for them and for their clients, then it will have been worth it. On design and build, Dr Teo has reiterated the point that this is a good approach, ie, the teamwork approach, that all professionals involved must work together in order to achieve the desired outcome and for Government to take the lead. Certainly, he would know that many public sector agencies have actually taken this design and build approach - the HDB, the old PWD, MINDEF. The design and build approach has produced results. It has shown itself to be a good way of doing things.”
“Mdm Deputy Speaker, first of all, let me address the points which Dr Teo Ho Pin made. I would like to thank him, first of all, for supporting the Bill. He made three very pertinent points. I would address them in turn. First of all, on the performance-based regulatory system. As Dr Teo said, and I agree with him, even though many countries have implemented these performance-based regulations, it does mean that they will automatically follow these regulations. In fact, I understand most designers and design qualified persons still follow the prescriptive system. It is quite understandable because it is a safer route as it is well-established. Why should they try something different? But this is precisely the point. Even though it is a safer route, the prescriptive system does impose certain restrictions. This is why we want to try to implement the performance-based system in Singapore to encourage innovation and flexibility. We are not saying that with this implementation of the performance-based system in Singapore, we want design qualified persons to move away from the prescriptive solution. What we are saying is that you can do both. You can either stick to the prescriptive solution if you wish to, or now you are given this flexibility to look for more innovative solutions, something which hopefully can cut costs and give more flexibility. That is why I agree with Dr Teo that the three desired outcomes of more flexibility, more innovation and cost reduction must be borne in mind when we implement this system. I also concur with Dr Teo's point that the system must be complemented by expertise accountability and responsible allocation of risks. I think the amendments that we are going to make in this Bill have adequately taken these into consideration.”
“Streamlining of requirement for licensed corporations and partnerships Finally, the Bill proposes to remove the requirement for the director overseeing the professional services offered by a licensed corporation or partnership under the Architects Act and the Professional Engineers Act, to be resident in Singapore. This is in view that the Building Control Act is already holding the appointed QPs responsible for the certification of plans and supervision of building works. In conclusion, this Bill proposes changes that will enable the construction industry to be more efficient and integrated. D&B arrangements will be facilitated and building processes streamlined. It will also allow for greater design flexibility and innovation. Continuous learning amongst our architects and professional engineers is encouraged through implementing performance-based regulations and continuing professional development. Mdm Deputy Speaker, I beg to move. Question proposed.”
“The Bill, therefore, proposes to set the maximum penalty for the supervising QP for failure in carrying out his role at the same level as that of the Accredited Checker, ie, $50,000 fine and/or 12 months' jail. The relevant amendment is found in section 9(4). The Bill proposes to amend section 5 to increase the maximum penalty for any person who commences or authorises the commencement of any building works without approval or permit. The increase is from the current $50,000 fine and/or 12 months' jail to $100,000 fine and/or 12 months' jail. The upward revision underlines the severity of the offence. Madam, the changes which I have mentioned are the maximum penalties for the various parties involved in the construction process. It is for the courts to mete out the appropriate penalty, based on the severity and circumstances of the offence. Introduction of continuing professional development The Bill also amends the Architects Act and Professional Engineers Act to require a registered architect or professional engineer to comply with prescribed requirements relating to continuing professional development as part of the criteria to renew his practising certificate. This is to ensure that the architects and professional engineers continue to stay abreast of developments in their respective fields. It emphasises the importance of training and professional development to maintain the high standards of architectural and professional engineering practices in Singapore.”
“In the wake of the collapse of the roof of Compassvale School in 2001, which was attributed to a structural design flaw, section 9(5A) was introduced to require the QP responsible for structural design to take reasonable steps and exercise due diligence in complying with the Act and the building regulations. The maximum penalty for a design QP for structural works for failing in this duty is a fine of $100,000 and/or a jail term of not more than 12 months. However, if a QP fails in his professional duties, it should not matter whether he is dealing with structural design or non-structural design. He should be subjected to the same penalty provision for the same offence of not exercising due diligence in carrying out his professional duties. Lapses in non-structural design could also result in serious consequences. Section 9(5A) is, thus, amended to extend the same duty and penalty to the QP for non-structural designs. A builder's responsibility to carry out building works in accordance with the approved design and under the supervision of a QP is as important as the design QP's responsibility in ensuring the safety of his design. If the design is robust but building works are not carried out according to this design, then the result could be an unsafe building. The amendments in sections 8(2), 9(5A) and 11(5) set the maximum penalty for a builder who fails to discharge his responsibilities to be on par with that of a design QP, ie, $100,000 fine and/or 12 months' jail. The supervising QP and Accredited Checker (AC) perform similar check-and-balance roles in supervising the builder's work and checking the QP's structural design, respectively.”
“As a safeguard, a new section 7A is inserted to empower the Commissioner to stop any non-structural building works, if they pose a danger to public or neighbouring properties. In addition, amendments are made to section 49 to allow the Commissioner to require additional information and documents to be submitted during the application of Temporary Occupation Permit and Certificate of Statutory Completion. This will enable better evaluation of the applications. Recovery of cost of engaging an expert Madam, there had been cases in the past where building works were constructed in such a manner that rendered the works unsafe or likely to lead to instability. In such incidents, BCA had to put in additional manpower and resources to monitor the safety of the affected building or building works. The investigation into the causes of the building's instability is highly technical and complex. It is prudent for the Commissioner to engage an independent specialist consultant to give him an independent second opinion. However, the Commissioner had to bear such costs in the past, which far exceeded the plan fees collected. The problem could be due to either design or construction inadequacies. As such, instead of paying such costs with public funds, the owner or developer of the project should bear the costs of engaging the specialist consultant. To this end, section 23 has been amended to enable the Commissioner of Building Control to recover the costs incurred in engaging the expert from the developer or owner of the building works. Review of penalties for offence under the Building Control Act Madam, my Ministry has also reviewed the penalty provisions for the different types of offences under the Building Control Act. I shall now explain these changes.”
“Corresponding changes in Building Control Act Corresponding amendments are made to the Building Control Act to facilitate the D&B arrangement. At the same time, sufficient safeguards are maintained to ensure building safety. The Bill amends section 6 of the Building Control Act to allow the builder in a D&B project to appoint the design QP and supervising QP for the project. However, the supervising QP for a project that is required to be checked by an accredited checker (AC) has to be independent of the builder. Hence, the supervising QP cannot be a partner, officer or employee of the builder or any of the builder's associates. Projects that require checks by ACs are usually the bigger and more complex projects. The independence of the supervising QP is necessary in such projects to minimise situations of conflict of interest. This will also ensure that the building works can be constructed with proper and impartial supervision. Other amendments Madam, my Ministry is also proposing other amendments to streamline and improve the regulation of buildings and the architectural and professional engineering services. Streamlining building work process Currently, after obtaining approvals for building plans, owners are also required to obtain permits to commence works from the Commissioner of Building Control before they can start construction. This is to allow the Commissioner to revoke the permit and stop works, should the construction works pose danger to the public or neighbouring properties. However, as non-structural building works usually do not have safety issues, clause 5 amends section 7 such that only structural works are required to obtain a permit to commence work. This will allow non-structural building works to commence immediately after approval of plans.”
“Builders can offer D&B packages jointly with architects and professional engineers. Licensed corporations can offer D&B services. The amendments will provide a single point of contact for the client. The industry will have more choices of D&B arrangements to meet its needs. Let me now elaborate on the specific amendments. Facilitate builders and professionals to undertake D&B projects A new subsection is added to section 10 of both Acts to allow a builder to offer to the developer all-in services jointly with architects and engineers as a D&B team. The Regulations of the two professional Acts will also be amended to allow an architect or professional engineer to supply the professional services in the same project in which he is acting as a builder. Facilitate licensed corporation to undertake D&B projects Corporations licensed by the Board of Architects and Professional Engineers Board are currently not allowed to provide design services and be the builder for the same project, unless specifically requested by the client. The Regulations of the two professional Acts will be amended to allow licensed corporations to provide D&B services. To encourage builders to form licensed corporations to offer a full range of services from design to construction, the Bill proposes to relax the requirements on the chairman and directorship control of licensed limited corporations in the two professional Acts. Directorship control by registered professionals in licensed limited corporations will be lowered from two-thirds to a simply majority. The need for the chairman of the licensed limited corporation to be a registered professional is removed.”
“Builders can approach architects and professional engineers to work on projects as a team on an ad-hoc basis. In these projects, the client pays and treats the builder and professionals as different entities. The drawback of such arrangements is that the D&B teams are not permanent. Any synergy and experience will not be accumulated and built upon. There are also legal impediments to other types of D&B arrangements. The Architects Act and Professional Engineers Act do not allow any person to offer architectural and professional engineering services, unless he is a registered architect, professional engineer or licensed corporation. An architect and professional engineer also cannot supply professional services in respect of any project in which he is acting as a builder. The C21 Report recommended reviewing the relevant legislation to remove any legal impediments against D&B projects. BCA therefore set up a committee in 2000 involving representatives from the Singapore Institute of Architects, Institution of Engineers Singapore, Singapore Contractors Association Limited and other relevant professional bodies to review the legislation. It recommended several amendments to be made to the Architects Act, the Professional Engineers Act and the Building Control Act. The Board of Architects and the Professional Engineers Board were also consulted. The proposed amendments have been incorporated in this Bill. Madam, without the amendments in this Bill, D&B can still carry on the way it has always been done with the builders and professionals working together, but, as I said, on an ad-hoc basis and as separate entities. With the amendments, there are more avenues for D&B to take place. Architects or professional engineers can offer D&B without tying up with a builder firm.”
“The amended section 9 requires the design QP to take all reasonable steps in ensuring that building works are designed in accordance with the provisions of the Act and the building regulations. Greater flexibility in design solutions comes with the responsibility of ensuring that the alternative design is safe and meets the specified performance objective. If the design QP proposes an alternative design, he should be in a position to take responsibility for his design. If he engages a second QP, that second QP must take all reasonable steps to exercise that the design complies with the requirements of the Act before certifying it. Design and Build (D&B) methods of procurement Mdm Deputy Speaker, I shall now move on to the amendments to facilitate Design and Build (D&B). Under the traditional "design-bid-build" (DBB) system, the design QP will complete the design with little input from the builder. Once the design is finalised, it is difficult for the builder to make changes or to suggest alternative construction methods without major redesign works upstream. In the 1999 Construction 21 (C21) Report on Re-inventing Construction, one of its key strategic thrusts is to adopt an integrated approach to construction. It identified the Design and Build process as one of the procurement methods for construction which can achieve closer integration. In a D&B arrangement, the client enters into a single contract with one entity. And this entity is responsible for both the architectural and engineering designs as well as the subsequent construction works. The inputs of the various players can be integrated upfront at the design stage. Incidents of re-works will be minimised. And the result is savings in cost and time for the client. D&B is being practised in some projects today.”
“However, it is a significant change in the concept of building control in Singapore. The Building and Construction Authority (BCA) has consulted extensively with the industry in working out the performance-based regulatory system. A Building Control Regulations (BCR) Committee comprising industry representatives was formed in the year 2000 to study the implications of this new regime to industry practice, and to review the scope and contents of the proposed performance-based building regulations. Proposed changes were posted on BCA's website for public feedback and comments. BCA also organised a forum last year with representatives from the Singapore Institute of Architects, Institution of Engineers Singapore and other relevant professional bodies to clarify queries in the new system. Madam, let me elaborate on the specific amendments to the Building Control Act. The Bill amends section 49 to provide for the objectives and performance requirements to be specified in the building regulations. It also amends section 9 to provide two options for the design QP to comply with the performance-based regulations. First, the QP can continue to adopt acceptable solutions set out by the Commissioner of Building Control and be deemed to have complied with the performance objectives. The QP can also adopt an alternative design solution so long as he certifies that his solution satisfies the specified objectives and performance requirements. He can also engage a second QP to jointly certify his design. This allows a design QP to collaborate with a specialist QP on the alternative design solution. Our current regulatory framework places responsibility on the QPs for their work. This continues to be the underlying regulatory philosophy under the new system.”
“Mdm Deputy Speaker, I beg to move, "That the Bill be now read a Second time." This Bill before the House seeks to revise the law in respect of building control for the following objectives: (a) Introduce a performance-based regulatory system to allow for design flexibility and encourage innovation in the construction industry; (b) Facilitate Design and Build (D&B) methods of procurement in the construction industry; and (c) Streamline and improve the regulation of buildings and the architectural and professional engineering services. Performance-based regulatory system Madam, let me explain the proposed amendments in detail. Currently, our building regulations are prescriptive in nature. They are time-tested and well-proven design practices and solutions. However, the weakness of such a system is that it does not allow the Qualified Persons (QPs) to propose alternative building design solutions. QPs have also told us that this system does not promote innovation and may create technical barriers to designers who are creative. Performance-based building codes, on the other hand, require the QPs to comply with objectives and performance requirements for the design and construction of buildings. It is not mandatory that the QP must follow a specific design solution. Design QPs are free to exercise greater flexibility and creativity in their design solutions so long as the objectives and performance requirements are met. In this way, QPs can be more responsive to market requirements and propose more cost-effective solutions which best meet their clients' needs. Performance-based building codes are not new. They have been adopted in developed countries, like the United Kingdom in 1987, New Zealand in 1992 and Australia in 1994.”
“Opportunity to be heard and appointment of officers The Bill's proposed amendments to the provisions relating to "the opportunity to be heard" and "MAS' powers to appoint its officers to grant or revoke exemptions" mirror those proposed in the Securities and Futures (Amendment) Bill. To conclude, the Bill draws on MAS' operational experience in administering the FAA and feedback from the industry to make a few technical refinements to the Act. To ensure that the FAA remains responsive to the industry and investors, MAS has started work on the policy reviews for the second phase of amendments to the FAA and will begin consulting with the industry later this year. Mdm Deputy Speaker, 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. - [Mr Lim Hng Kiang]. Bill considered in Committee; reported without amendment; read a Third time and passed. EVIDENCE (AMENDMENT) BILL Order for Second Reading read. 5.22 pm”
“Corporate entities will not be permitted to act as representatives of financial advisers. Greater scope for MAS to issue written directions General or specific written directions are legally enforceable. Clause 19 amends section 58 to empower MAS to issue written directions to representatives of exempt financial advisers. This amendment will harmonise the application of section 58 for representatives of licensed financial advisers and representatives of exempt financial advisers. While representatives of exempt financial advisers are not required to hold a representative's licence, the business conduct rules of the FAA will apply to them. To enable MAS to respond quickly to time-sensitive industry developments or requests from the industry participants, the amended section 58 also expands the scope that written directions can cover. I have earlier noted a similar amendment in the Securities and Futures (Amendment) Bill. Madam, the following are also amendments that are common to the SFA Bill and this Bill. Communications containing recommendations on securities Financial advisers will no longer be required to sign circulars or other communications that contain recommendations on securities. MAS has received feedback from the industry that the requirement for a signature is administratively difficult. MAS has decided that the requirement can be removed without compromising investors' interest because financial advisers will remain accountable for their recommendations. The number of years that such documents have to be retained will be reduced from seven years to six years.”
“The FAA consolidates in a single piece of legislation the rules for financial advisers and their representatives when giving financial advice on investment products, marketing collective investment schemes and arranging contracts of life insurance policies. These rules were previously found in separate legislation - the Futures Trading Act, the Insurance Intermediaries Act and the Securities Industry Act. These Acts have now been repealed. The FAA establishes a consistent regulatory framework for financial advisory services across the financial services industry. Madam, the FAA will also be amended in two phases. This will parallel the legislative review of the SFA. The first phase has culminated in this Bill where MAS has proposed some technical modifications. The second phase, which involves more in-depth policy reviews, is scheduled to be completed in the second half of 2004. MAS conducted a public consultation review in April 2003. MAS' detailed reply to the comments received in the course of the public consultation is published on its website. Madam, let me now highlight the key amendments that are proposed in this Bill. Exclusion of life reinsurance Clause 2 amends the definition of "life policy" in section 2(1) to exclude any contract of reinsurance because life reinsurance activities are already regulated by MAS under the Insurance Act (Chapter 142). With this amendment, a person conducting any activity involving contracts of reinsurance is only subject to the requirements of the Insurance Act. The FAA will not apply. Representatives of financial advisers must be natural persons The Bill clarifies that only natural persons can act as representatives of financial advisers. This ensures proper accountability by the principal for the conduct of the representative.”
“But we must be mindful that the SFA is a relatively new piece of legislation that both MAS and the industry are still growing into. Thus, only minor changes have been introduced in this round of amendments and other more substantive policy reforms have been deferred to the second half of 2004. The Bill gives us a chance to improve and clarify aspects of the SFA. Many of these amendments, especially those to implement the Company Legislation and Regulatory Framework Committee's recommendations, will help reduce business costs in Singapore. MAS will continue to engage in discussions with industry practitioners and to take more of their suggestions on board for the second phase of amendments in 2004. Madam, 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. - [Mr Lim Hng Kiang]. Bill considered in Committee; reported without amendment; read a Third time and passed. EXEMPTED BUSINESS (Motion) Resolved, That the proceedings on the business set down on the Order Paper for today be exempted at this day's sitting from the provisions of Standing Order No. 1. - [Mr Mah Bow Tan]. FINANCIAL ADVISERS (AMENDMENT) BILL Order for Second Reading read. The Second Minister for Finance (Mr Lim Hng Kiang): Mdm Deputy Speaker, I beg to move, "That the Bill be now read a Second time." The Financial Advisers Act (FAA) was passed concurrently with the Securities and Futures Act (SFA) in October 2001 as part of the major revamp of Singapore's capital markets regulatory framework.”
“Opportunity to be heard Madam, MAS has been vested, under the SFA, with administrative powers, including powers to revoke or suspend licences of corporations and their representatives, approve markets and clearing facilities, and issue stop orders on offers of investment. Such powers will be exercised judiciously by MAS to pursue its statutory objectives. In line with rules of natural justice, the SFA provides for opportunities to be heard to parties who are aggrieved by MAS' administrative decisions. The Bill extends the opportunity to be heard to a wider range of MAS' decisions that could potentially affect an applicant's interests adversely. The SFA currently provides a list of exceptions to the opportunity to be heard. The intent behind these exceptions was to dispense with the opportunity to be heard where the original decision was based on objective facts and it would be improbable for MAS to reverse its decision as a result of new information introduced at a hearing. An example would be when the aggrieved party, or a related entity, was insolvent or near insolvency. The Bill further narrows the list of exceptions to the opportunity to be heard to cases where the aggrieved party is already insolvent, or has been convicted of an offence involving fraud or dishonesty. These exceptions constitute a small and unambiguous subset of the circumstances under which MAS would want to exercise its administrative powers in protecting the interests of the investing public. Nevertheless, parties who are denied an opportunity to be heard will still have the right to appeal to the Minister. Madam, the capital markets are constantly evolving, and the regulatory framework must therefore keep pace to remain responsive and relevant.”
“For example, clause 45 will empower MAS to issue rules on the training and qualifications of representatives through written directions rather than subsidiary legislation. MAS may change these requirements without needing to go through the process of promulgating subsidiary legislation, and any changes can then come into effect immediately. Clause 100 will empower MAS to appoint its senior officers to grant or revoke specified regulatory exemptions on a case-by-case basis. Such exemptions need not be published in the Government Gazette. MAS needs only notify the exempted entity in writing. This will shorten MAS' response time to applications for such exemptions. For example, time-sensitive requests for exemptions from prospectus rules are quite common. The result is that MAS will then be able to be more responsive to the needs of a rapid changing marketplace. Reduction in regulatory and compliance costs The Bill also seeks to reduce regulatory and compliance costs, where these do not afford commensurate protection to the investors. Clause 49 will remove the requirement for licence holders to sign circulars and other written communications sent by them, and to shorten the retention period for such materials from seven to six years. This is in line with the record keeping requirements in other parts of the SFA, and consistent with the statutory period of limitations for contractual actions under the Limitation Act (Cap. 163). Other changes aimed at cutting regulatory and compliance costs will be made in the subsidiary legislation promulgated by MAS, as part of MAS' ongoing review to ensure that its rules remain relevant and business-friendly.”
“MAS' oversight of clearing facilities under the SFA is currently restricted to facilities that clear securities and futures contracts that are traded on exchanges or other organised trading platforms. This has worked well in the past, when clearing facilities were largely limited to clearing for exchange-traded instruments. Trades in the OTC market were negotiated and settled bilaterally, usually between financial institutions. However, with the increasing use of sophisticated OTC contracts, clearing facilities for these contracts have emerged. These facilities pose risks similar to those of facilities that clear exchange-traded instruments. It would, therefore, be prudent for MAS to have the power to regulate such clearing facilities operating in Singapore or targeting Singaporean investors where they pose risks to MAS' regulatory objectives. [Mdm Deputy Speaker (Mrs Lim Hwee Hua) in the Chair] 5.10 pm Temporary licensing regime As part of MAS' ongoing review of the licensing regime, and in response to feedback from the industry, MAS will be introducing a temporary licensing regime for individuals. Clause 36 allows MAS to issue temporary licences to individuals residing outside Singapore who plan to engage in regulated activities in Singapore, on behalf of a locally-licensed entity, but for a short-term basis. The application process will be simplified and processing time will be shortened. This will give financial institutions flexibility in deploying specialist expertise on a short-term basis. Flexibility of administration Madam, the Bill will seek to give MAS greater flexibility in carrying out its duties.”
“Clause 80 dispenses with the need to lodge a notice to invoke exemptions from the prospectus requirements, and repeals the requirement for Singapore-incorporated issuers to maintain a register of securities issued under an exemption from the prospectus requirements. Sir, there is no countervailing public interest to be served in requiring MAS to be the depository of such exempted offering documents, such as information memoranda and notices invoking exemptions. Such requirements only add to administrative and regulatory costs. The CLRF Committee also found no reason why Singapore-incorporated issuers should maintain a register of exempted issues, when foreign-incorporated issuers are not subject to this requirement. Repeal of requirements on trustees for debentures The SFA currently requires issuer companies to appoint trustees and to include certain prescribed covenants in the trust deed for public offerings of debentures. These requirements are not stipulated for share offers, even though the risks associated with debentures are generally lower than those for shares. Clause 72, therefore, repeals these provisions and removes the current differential treatment between share and debenture offers. The differential treatment also does not accord with the prevailing practices in the international bond market and increases the cost for debenture issuers. Sir, let me now turn to the other amendments that address industry feedback and market developments in the last two years. Regulation of clearing facilities for OTC derivatives Clause 2 amends the long title and expands the scope of the SFA to include clearing facilities for Over-the-Counter (OTC) derivatives.”
“Resale of shares and debentures, whether listed or unlisted, acquired under the institutional or sophisticated investor exemptions, will not be deemed a public offer, if six months have elapsed since the initial purchase. Unlisted shares and debentures may be resold to persons other than institutional or sophisticated investors after the 6-month period without a prospectus, as long as the sale does not amount to a public offer. For collective investment schemes, the CLRF Committee recommended allowing the secondary trading of schemes purchased under the institutional and sophisticated investor exemptions. Clauses 91, 92 and 93 remove the requirement that units in such schemes be non-transferable and allow subsequent sales among institutional and sophisticated investors. Replacing certain offer documents with an information statement Mr Speaker, Sir, I would like to turn next to replacing certain offer documents with an information statement. When a listed company makes a renounceable rights issue, clause 68 replaces the current requirement for the company to issue an abridged prospectus with that of an offer information statement. The offer information statement will be a shorter and more relevant document in such circumstances. As mentioned earlier, information on such listed issuers would be publicly available, as they already comply with the continuous disclosure obligations. Therefore, clause 79 provides that a listed company may offer additional issues of shares using an offer information statement. Repeal of reporting requirements Several provisions in the SFA have been repealed to further streamline the fund-raising process. Clause 77 removes the need to lodge, with MAS, an information memorandum used for offers to sophisticated investors.”
“Further, as the listing rules of the Exchange require that the terms and conditions of such listed units be disclosed, there is therefore no need to require a fresh prospectus for the offer of such units. Third, the exemption for offers by a corporation pursuant to an employee investment scheme, which is currently restricted to current employees, will be extended. The amendment will allow all bona fide employees and former employees to participate in these schemes. There are no strong reasons to restrict the scope of such employee investment schemes to just the current employees. The changes will give companies greater flexibility in responding to market conditions, and in structuring their incentive and compensation packages. Resale of securities exempt from prospectus requirements Under the SFA, offers made only to sophisticated or institutional investors are exempted from the prospectus requirements. To prevent the circumvention of our prospectus requirements, any resale of securities purchased pursuant to such exemptions to persons who are not sophisticated or institutional investors will be regarded as a public offering requiring a prospectus. This restriction does not apply for the resale of listed shares and debentures, if the transactions take place six months or more after the initial acquisition of the securities. However, the resale of unlisted shares and debentures requires a prospectus, whether or not six months have elapsed. This is restrictive and does not accord with the practice in other major international financial centres. Clause 78, therefore, aligns the practice for listed and unlisted shares and debentures.”
“Facilitating capital raising Our regulatory framework for capital raising has to balance the needs of issuer companies with those of investors. This is achieved by imposing requirements on the conduct of public offers, such as requiring offers to be accompanied by a prospectus. The Bill rationalises the provisions for public offers of investments. The thrust of the amendments is to make it easier and less expensive for companies to raise funds without compromising investor protection. Exemption from prospectus requirements The SFA already exempts several classes of offers from prospectus requirements. These exemptions cater to offers where it would not be prejudicial to the public interest to dispense with a prospectus, such as when the offer is not available to the general public, or where information in the prospectus is already available from other sources. Clause 76 exempts three further types of offers of investments from the prospectus requirements. First, there will be a new exemption for offers made in connection with a takeover of a foreign-incorporated company, if the offer complies with the relevant requirements of the country where the company was incorporated. This extends the current exemption for offers that comply with the Singapore Code on Takeovers and Mergers to foreign companies subject to other comparable regulations, and allows Singapore shareholders of such companies to participate in these takeover offers. Second, issues of units of securities, including covered warrants, to be listed on a securities exchange will be exempted, if the underlying securities are already listed. Information on listed companies should already be readily available to investors, given their obligations to disclose material information on a continuous basis.”
“Sir, I beg leave to withdraw the motion. Motion, by leave, withdrawn. SECURITIES AND FUTURES (AMENDMENT) BILL Order for Second Reading read. 4.58 pm The Second Minister for Finance (Mr Lim Hng Kiang): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Securities and Futures Act (SFA) was passed in October 2001. In October 2002, the Company Legislation and Regulatory Framework (CLRF) Committee completed its comprehensive review of the company law and regulatory framework in Singapore and suggested measures to modernise our regulatory framework and make Singapore more globally competitive. The SFA will be amended in two phases. The current Bill implements 12 of the CLRF Committee's recommendations aimed at reducing the cost of raising capital in Singapore, by rationalising and simplifying the requirements in the SFA for offers of investments. We are also taking this opportunity in amending the SFA to incorporate some technical amendments to the SFA in the light of industry developments and feedback on the implementation of the Act over the last two years. The second phase of amendments, targeted for the second half of 2004, will implement the remaining recommendations of the CLRF Committee, and introduce changes to the regulatory framework for the securities and futures industry requiring more substantive policy review. The Monetary Authority of Singapore (MAS) invited feedback from the industry and the public on the draft Bill in April this year, and has posted its detailed responses to the comments received during this consultation on its website. Mr Speaker, Sir, I will now go through the main amendments in the Bill, beginning with those implementing the CLRF Committee's recommendations.”
“Mr Speaker, Sir, may I seek your consent and the general assent of Members present to move that the proceedings on the item under discussion be exempted from the provisions of Standing Order No. 45(8) to remove the time limit in respect of the Prime Minister's reply.”
“Sir, I think it was the Deputy Prime Minister on Friday who said that "HDB is forbearing to a fault." I think those were his exact words. I am sure that if a case like that comes up and if the lessee is genuinely unable to service his mortgage loan, HDB will bend over backwards to see how it can help him.”
“I am afraid I do not have the profile at this point in time. I will be able to get it for him if he files a Question.”
“So, we will see whether we can expedite this. Further, the current clause which provides for withholding payments to contractors in order to recover liquidated damages and debts is also being reviewed. In other words, we will see whether we still need to consider a set-off clause whereby we hold back some monies that are owing to the contractors because they owe the agencies some money. This set-off clause currently is causing some difficulties to contractors. Sir, I will announce details of these measures in October. But let me stress that while we can take all possible measures to assist the viable industry players cope with the present difficulties, I must caution that, in themselves, they will not be sufficient. Companies must continue to improve their skills, consolidate their resources and upgrade their competitiveness. Those who are ready must seek opportunities overseas, and I am pleased that some of them are already doing so with some success. Hopefully, we can multiply this success further. We will help our companies break into markets overseas, like India and China. And as our economy recovers, so will the construction industry. Mr Speaker, Sir, let me say, in conclusion, that the CPF changes that the Government is making are necessary to save jobs in the immediate future. And in the longer term, they will enable our businesses to be more competitive and to position our economy for a period of renewed growth when the external economic conditions improve. The measures, which I have outlined, will help Singaporeans and businesses, in particular, HDB residents and the construction industry, adapt to the changes. Sir, thank you for letting me join in this debate.”
“Hopefully, in this way, construction firms will be able to secure their place in the CRS system, and not bid at any price just to secure jobs and to satisfy their track record. Measures under consideration to improve the payment system are also being considered. In consultation with Government and industry stakeholders, BCA will see how we can improve the payment system right across the value chain, and the aim is to improve the cash flow which, we all know, is the life-line of the industry. One measure being studied is to legislate a security of payment system, and the intention is to provide a fast and low-cost system of resolving progress payment disputes by adjudication. This is a complicated matter. It is not something that we will rush into. We have to consult closely with the various parties in the industry to ensure that all relevant factors and views are taken into account. A multi-agency task force is also reviewing the Public Sector Standard Conditions of Contracts (PSSCOC). And for those contractors who are involved in public sector projects, I think they will know exactly what this is all about. Under this contract, all payments to main contractors are governed by certain clauses. The proposal is for payments to main contractors to be made known to sub-contractors, so that main contractors cannot then say that they are not being paid in order to avoid or delay paying the sub-contractors. This is a common complaint of sub-contractors. We are seeing how we can address this. We are also looking to speeding up the valuation of variation works for faster progress payments and for settlement of final accounts. Again, another common complaint is that the Government agencies take too long to settle the variation orders and therefore progress payments are delayed.”
“As most of the projects to be advanced will be less than $30 million in value, we expect that local contractors will stand to benefit directly from this move, and it will help them to tide over this difficult period. We will also be fine-tuning some of the Government procurement policies in order to help to further improve the situation for contractors. In the last three months, the Building Construction Authority (BCA) has been in serious discussion with public agencies as well as the industry on how we can fine-tune the system in order to help the contractors. First of all, we will tighten the Contractors' Registry System (CRS) to better reflect the financial standing of contractors tendering for public sector projects. What we try to achieve with this is more timely financial health reporting which will then assist public sector agencies to select contractors who are capable of undertaking projects within their financial capacity. And, hopefully, this will minimise work stoppages and also the downstream problems of payment to sub-contractors and to suppliers. Secondly, BCA will relax the track record requirements for construction firms to renew and retain their CRS grades. I remember that some Members in this House brought up the issue of suicide bids and we had this very lively exchange as to whether contractors actually do go in for suicide bids. Nevertheless, the point is that in order to minimise the possibility of them being pressured to make such suicide bids, BCA will extend the qualifying period from three years to five years, as well as include some ongoing projects, rather than just the completed projects.”
“Very few people actually needed this extra help, but the schemes gave comfort and reassurance to many. These schemes will still be made available. Based on our experience in 1999, the mortgage repayments should not be a major problem, as the cut is smaller, 3 percentage points instead of 10. Nevertheless, we will make sure that help is available to everyone who needs it. I am also pleased to read that private banks have expressed that they will also exercise flexibility and restructure their mortgage loans to help borrowers cope. So, these schemes will further minimise difficulty for borrowers. Mr Speaker, Sir, let me now turn to measures to help the construction industry. The construction industry is currently under a lot of stress. It has borne the brunt of the economic downturn. Annual construction demand has fallen from a peak of $24 billion in 1997 to $14 billion in the last two years. We expect that demand is likely to fall further this year to about $11.5 billion. As demand drops, competition becomes keener, more intense. Many contractors are cash strapped. Some have become insolvent. Sub-contractors are now complaining that they do not get paid or payments get delayed. Several public projects have been affected by work stoppages because contractors run into financial difficulty. On the average, about 60% of total annual demand in the construction industry is from the public sector. The Deputy Prime Minister has announced that Government will bring forward about 60 public sector projects worth more than $600 million in FY 2003 and FY 2004. This will help to boost demand, safeguard jobs and revive business confidence in the industry. Our records show that 92% of public sector project contracts valued between $10-$30 million were awarded to local contractors.”
“There are sufficient flats available for those who wish to buy a 3-room buy-back flat if they are earning below $2,000. For second-timers, those who are downgrading, they can buy a 3-room flat from the open market. There are roughly 220,000 3-room flats available in the open market. I can assure the Members that there is currently no shortage. However, HDB will monitor the trends closely and review the need to build new 3-room flats, if necessary. For a start, we can consider building some 3-room flats in our SERS (Selective En-bloc Redevelopment Scheme) replacement precincts. As for new 4-room flats, we will be offering such flats for sale. There is a build-to-order (BTO) exercise coming up this month. These flats will be in Punggol, Sengkang and Sembawang, and they will be priced affordably. We have worked the numbers, we have done the sums and, roughly, households with an average monthly income will probably need to use about 20-22% of their monthly income to finance the purchase of these new flats. Again, just to remind Members, this is below the revised CPF OA contribution rate of 22%, and well within the 40% guideline which HDB and most financial institutions use as a basis for credit assessment. Sir, let me now turn to private property owners. Many have expressed concerns about the impact of the CPF changes on their mortgage payments. When we cut the CPF by 10 percentage points in 1999, we implemented various measures to help people to cope with these changes. Firstly, CPF members could use their Special Account to top up any shortfall in the mortgage payments after they have made use of their OA balances. And then those who still had a shortfall could apply for a bridging loan.”