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.”
The complete record
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 35 of 61.
“Mr Speaker, Sir, I believe that the Prime Minister did say that these precincts will be considered for upgrading, and in the light of the comments that Mr Chiam made after the election that his precincts did give more than 50% support to the programme through the votes for the PAP candidate, I believe that this consideration will be duly taken into account.”
“Mr Speaker, Sir, all private residential estates, including Sennett Estate, can apply for upgrading under the Estate Upgrading Programme (EUP). A number of estates will be selected each year, depending on the budget available. Last year, eight estates were selected. The number for this year has not been decided yet. Many factors are taken into consideration when selecting an estate for upgrading. These include the age and physical condition of the estate, the level of community bonding and support for the programme and whether there is scope for improvement. MND would invite nominations from all Citizens' Consultative Committees (CCCs) in June this year. Mr Chiam See Tong (Potong Pasir): Sir, the upgrading of Sennett Estate and blocks of flats in the same precinct was promised by the Prime Minister at the last election. After having given a promise to the residents, do they still need to apply for upgrading?”
“Table: Number of dropouts by reasons Reasons 1997 1998 1999 2000 2001 1059 851 693 774 817 Loss of interest Found/Seeking 462 273 175 172 144 employment Financial difficulty 66 63 69 41 35 Family problem 69 61 76 75 63 Total 1656 1248 1013 1062 1059 When students show signs of dropping out, principals and teachers will dissuade them from doing so. Their efforts include counselling the students, monitoring their attendance and contacting their homes when they are absent, inviting parents to school, and making home visits to discuss the matter with the parents. Where the reason for dropping out is financial, schools are prepared to extend financial aid to the students. Annex 1 - Changes to ARF, ED and PARF for Cars and Taxis (Cols. 727-728) Annex 2 - New Excise Duties for Liquors (Cols. 729-730) Annex 3 - New Excise Duties for Other Tobacco Products (Cols. 731-732) Annex 4 - Tax Measures to Promote Philanthropy (Cols. 733-734) Annex 5 - Tax Incentives for the Financial Sector and Enterprise Development (Cols. 735-742) Annex 6 - New Personal Income Tax Structure and Rates (Cols. 743-744) Annex 7 - Not Ordinarily Resident Taxpayer Scheme (Cols. 745 - 746) Annex 8 - Changes to Tax Treatment of Stock Options (Cols. 747 - 748) Annex 9 - Rebates for Service & Conservancy Charges and Rent (Cols. 749 - 750) Annex 10 - Impact of Economic Restructuring Package on Households (Cols. 751 - 752)”
“HDB flats are meant for owner-occupation. Hence, subletting of whole flat is approved only under certain approved conditions. Since September 2000, HDB has allowed elderly lessees to sublet their entire flats for additional income, on a case-by-case basis. To ensure that such subletting is neither abused nor fuel excessive demand for HDB flats, HDB has restricted the scheme to applicants who: (a) Are 65 years and above at the point of application; (b) Own a 3-room or smaller flat; (c) Have occupied the flat for at least 25 years; and (d) Have no outstanding mortgage loan with HDB. To-date, 131 cases have been approved. HDB will continue to monitor the response to the scheme and fine-tune it if necessary. EARLY SECONDARY SCHOOL LEAVERS 7. Mdm Cynthia Phua asked the Minister for Education, from 1997 - 2001 (a) what is the number of early secondary school leavers who did not complete their education; (b) what are the reasons causing them to leave school early; and (c) what is the number of students falling within each of the reasons. RAdm Teo Chee Hean: The number of students who dropped out of our schools between Secondary 1 and Secondary 4 has been on a downward trend over the years. It has decreased from 1,656 in 1997 to 1,059 in 2001. In percentage terms, it has dropped from 3.3% of the Primary 1 cohort to 2.7% over the same period of time. Students drop out of school for a variety of reasons, including loss of interest and financial or family problems, or they may have found employment or are seeking employment. The number of students falling within each of these reasons is given in the table below.”
“Ultimately, whether a shop survives and thrives depends not on how much assistance the Government gives, but whether the shop can attract and retain its customers. Fortunately, not all is gloom and doom. It is not difficult for HDB shops to find their own niche and develop a base of loyal customers, because there will always be residents who, for reasons of convenience or familiarity, still prefer to patronize HDB shops rather than large shopping malls and mega marts. Due to the size of their operations, it is also easier for HDB shopkeepers to provide personalized services to their customers. Sheng Siong Supermarket is an example of a HDB shop which has upgraded its business operations and done very well, despite keen competition from bigger players like NTUC Fairprice and Cold Storage. HDB shops should also consider banding together to form "commercial streets" to attract shoppers. The shopkeepers in Marine Parade Town Centre, Chong Pang City and Toa Payoh Town Centre who have worked so, have demonstrated that this is a worthwhile and workable idea. WRITTEN ANSWERS TO QUESTIONS PROTECTION FOR REMITTING MONEY OVERSEAS 1. Mr Chiam See Tong asked the Deputy Prime Minister and Minister for Finance (a) how his Ministry intends to protect the interest of the public when they remit their money overseas through licensed remittance companies and (b) whether his Ministry will review the existing rules with a view to bring those rules in line with those made for banks.”
“HDB shops have not been spared the problems that the local retail sector has faced over the past few years. HDB shop-owners are today faced with keen competition, not just locally but also overseas. Since the eighties, new suburban shopping malls and mega stores have entered the local retail scene, and NTUC Fairprice's mega stores are but the latest. These stores provide the convenience of one-stop shopping, usually in air-conditioned comfort, within HDB estates, and are hence popular with HDB residents. Many Singaporeans also travel to Johor Bahru, Kuala Lumpur and other nearby destinations to shop for their groceries, personal wear and other items at lower prices. In the current economic downturn, domestic demand has also been depressed by wage cuts and fear of job losses. Against such a backdrop, it is inevitable that some HDB shop-owners and tenants will see a drop in their business. To assist them to tide through their current difficulties, HDB has implemented various assistance measures, including rental rebates, passing on property tax savings to them, exercising greater flexibility in granting approval for change of use and trade, and allowing shop-owners to convert to shorter leases or sublet their shops. But in the longer-term, HDB shop-owners and tenants will have to continually upgrade their business operations and adapt to lifestyle changes and consumer preferences to survive. They need to focus on areas such as the use of IT, customer service management, inventory control management and cashflow management in their business operations. The Standards, Productivity and Innovation Board (SPRING) and the Retail Promotion Centre have in place various schemes to help them.”
“Sir, as I explained, the reclamation works are within our territorial waters and we have satisfied our international obligations. I do not see that there is a need for us to consult. PATIENTS IN ACUTE HOSPITALS (Fees for overstaying) 3. Dr Lily Neo asked the Minister for Health how many patients, who have overstayed in acute hospitals, have been charged with higher fees since the policy was implemented from March 2002.”
“Sir, as DPM Lee has asked the Malaysians to send us a note, I think it is important for us to wait until we receive such a note in order to understand more clearly what exactly are their concerns. Because right now, from what we read in the media, there are so many different allegations and some of these allegations contradict one another. So I think it is best for us to just calmly wait for the note to come.”
“We have carried out these works within our territorial waters. We have taken all the necessary steps to examine whether there would be any adverse impact on the surrounding waters. The reclamation profile has been properly calibrated to make sure that the impact on the environment is minimised, if not, completely eliminated. So as far as we are concerned, we have carried out all these works in accordance with our international obligations and within international laws. There is really no need for us to stop work at this point in time.”
“I think I should defer to my colleague, the Minister for Foreign Affairs, to answer this question. But as far as I know, it is an agreement that was signed by the Minister for Foreign Affairs for Singapore and the Minister for Foreign Affairs for Malaysia. It is an agreement that was ratified by both countries. It cannot be unilaterally altered by either party. Mrs Lim Hwee Hua (Marine Parade): I would like to ask the Minister, therefore, is there a basis for the Malaysians' expectations of us to stop work.”
“When the reclamation works are being done, first of all, the reclamation barges have to be properly managed, properly steered, and so on. As far as the actual works are concerned, there is a requirement for the reclamation works to be carried out in such a way that pollution and siltation are kept to a minimum. For example, the contractors are required to make use of siltation screens. These siltation screens are meant to block the silt from actually moving out of the area of reclamation.”
“As I said earlier, we have looked at reclamation and we have carried out reclamation since the 1960s. To summarise, we are a small country, we need land. We have been reclaiming land for a very, very long time. Even then, after all the reclamations for the last 40 years and all the reclamations that we are going to carry out within our territorial waters, we will still be a small country, still smaller than Malaysia. So it is rather surprising that these allegations come out at this particular point in time, that we are thwarting their port development, that we are affecting their waters, or affecting them in many other ways. As I stated earlier, our reclamation works are done within our waters, in accordance with international law. We do not encroach on Malaysian territory. They do not affect navigation in the Johor Straits. They do not narrow the channel. They do not affect the water quality. The reclamation works that we do are a result of our own need for land. So I do not see why we have to consult Malaysia on a matter of sovereign concern. A few years ago, Malaysia was thinking about reclaiming some land off Johor, in the Straits. This was not too long ago, and the planned reclamation was very extensive. They did not see the need to consult us, neither did we make any noise about it. So given this, the fact that we need to reclaim, given the fact that we have made studies to ensure that the reclamation works do not have an impact, is it necessary for us to consult? Is it unreasonable for Singapore to want to continue to reclaim land to the maximum extent possible, within our territorial waters?”
“Sir, to answer Mr Iswaran's question, let me first explain to the House why we reclaim land. Singapore is a small country. We are about 680 sq km. We need land. When Habibie said that we are a little red dot, he was not too far off the mark. If you look at the map, you will see Singapore in relation to Malaysia and Indonesia. Malaysia is about 330,000 sq km. So we are less than 1%, about 0.2%, the size of Malaysia. Our population is growing. Our need for land for schools, factories, housing is growing. That is the reason why we have to reclaim land. Without reclamation, we would not have Marine Parade, we would not have East Coast Parkway, we would not have the airport. Without reclamation, we would not have Jurong Island, we would not have space for industries. Without reclamation, we would not have Marina South to expand our CBD. So that is the reason why we have to reclaim land. We are not a big country like Malaysia. Secondly, our reclamation is not a secret. We do not do reclamation quietly and sneak it through and suddenly we have the barges going to Pulau Tekong to reclaim land. Our plans are approved in Parliament, in this House. They are reviewed in all our concept plans. In fact, the reclamation of Pulau Tekong was reviewed in the 1991 Concept Plan, 11 years ago. The concept plans are revised every 10 years, and in the 2001 Concept Plan which we released last year, the reclamation plans are still there. Any member of the public can get access to these plans. If you are not in Singapore, you can just click on to www.ura.gov.sg and you can see these plans. So these are not secret plans, neither are they carried out surreptitiously or just on the spur of the moment.”
“In the case of Tuas, our reclamation works are about 7 km away from the shipping lane to Tanjung Pelepas Port, so there is no possibility that our reclamation would affect access to Tanjung Pelepas Port. I would also like to address allegations that the reclamation works at Pulau Tekong will increase the current flow in the Johor Straits, cause flooding in Johor and affect the fishermen's catches. Hydraulic modelling studies are done for our reclamation works to assess the impact of reclamation on currents, tidal flows and water quality. They indicate that the reclamation at Tuas and Pulau Tekong will not have an adverse impact on the surrounding waters. Furthermore, water quality in the Johor Straits has also been jointly monitored on a regular basis by our Ministry of the Environment and Johor's Department of the Environment (DOE) since 1991. The results show that the water quality in the Johor Straits has remained unchanged even after reclamation works have started. Sir, Singapore has acted within its rights and obligations under international law in carrying out the reclamation works. During his visit to Malaysia in March this year, DPM Lee had indicated that if the Malaysians had concerns about the effects of the reclamation, they could send us a note and we would consider it. The Singapore Government is still waiting for a note from the Malaysians to understand their concerns more fully.”
“Mr Speaker, Sir, there have been many reports in the Malaysian media alleging that our land reclamation works off Pulau Tekong and Tuas will impact Malaysia in various ways. We are surprised by these recent allegations since our land reclamation policy is not new. Given Singapore's small size, it has been our long-standing policy to reclaim land from our territorial waters so as to meet the demands on land use. I will address these allegations in my response. First, there is concern that our works may encroach into their territorial waters, or somehow shift the boundary between Singapore and Malaysia. We have stated that the reclamation works are carried out entirely within our waters and that there is no encroachment. The reclamation works also cannot change the territorial boundary in the Johor Straits. This boundary was defined by fixed geographical coordinates since 1995 in an Agreement that was signed and ratified by Singapore and Malaysia. Another concern raised is that the reclamation works at Pulau Tekong will affect the shipping lane to Pasir Gudang Port by making the shipping lane narrower and shallower. Sir, this is not the case. The existing shipping lane to Pasir Gudang Port lies in the deep water channel between mainland Singapore and the islands of Pulau Ubin and Pulau Tekong. Ships going to our Sembawang Wharves also use this shipping lane. The current reclamation works at Pulau Tekong will not reduce or otherwise affect the existing width of this shipping lane. The shipping lane is not made shallower by the reclamation works. The Maritime Port Authority (MPA) regularly monitors the siltation levels within the shipping lane to ensure that the channel remains deep enough for navigation.”
“Mr Speaker, Sir, may I seek your consent and the general assent of hon. Members present to move that the debate be now adjourned?”
“Mr Speaker, Sir, I beg to move, That, notwithstanding the Standing Orders, with effect from this day's sitting until the termination of the First Session of this Parliament:- (a) Question Time may continue for up to one and a half hours from the commencement of a sitting; and (b) the existing time in Standing Order No. 88(2) be revised from "1.30 pm" to "2.00 pm." Sir, this is to allow Members more time for questions and for answers to their questions. Question put, and agreed to. Resolved, That, notwithstanding the Standing Orders, with effect from this day's sitting until the termination of the First Session of this Parliament:- (a) Question Time may continue for up to one and a half hours from the commencement of a sitting; and (b) the existing time in Standing Order No. 88(2) be revised from "1.30 pm" to "2.00 pm." PRESIDENT'S ADDRESS Debate on the Address (Second Allotted Day) Order read for Resumption of Debate on Question [1st April, 2002], That the following Address in reply to the Speech of the President be agreed to:- "We, the Parliament of the Republic of Singapore, express our thanks to the President for the Speech which he delivered on behalf of the Government at the Opening of the First Session of this Parliament.". - [Mrs Lim Hwee Hua]. Question again proposed.”
“Mr Speaker, Sir, may I seek your consent and the general assent of hon. Members present to move that the debate be now adjourned?”
“Sir, I also propose that Mrs Lim Hwee Hua be elected as a Deputy Speaker of this Parliament. Mrs Lim has been a Member of this House since 1996. She was a Member of the Public Accounts Committee in the last Parliament. I am confident that she too will be a good Deputy to you.”
“Mr Speaker, Sir, I propose that Mr Chew Heng Ching be elected as a Deputy Speaker of this Parliament. Mr Chew has been in Parliament since 1984. He has sat on many parliamentary committees, including the Public Accounts Committee as well as the Estimates Committee. Sir, I believe he is well able to assist you in the performance of your duties.”
“However, projects of $20 million or below are opened for competition among the private sector consultants. The value of work assigned to PWDCorp during the moratorium period is not more than what was already with the PWD before its corporatisation. PWDCorp does not perform any construction works. The private sector has in fact benefited as a result of the PWD corporatisation. Before its corporatisation, PWD was handling all Ministry projects. Since corporatisation, the Government has directly awarded more than $450 million worth of projects each year to other private sector consultants. Nearly half of these are sizeable projects worth between $12 million and $20 million in value each.”
“Sir, we have identified a number of areas where we think the voluntary retirement scheme would be of immediate interest, and these are mainly in the older housing estates. There is a pilot voluntary retirement scheme which has just been implemented, and we are awaiting the response from that voluntary retirement scheme. If the hon. Member would like to suggest any other area that we could apply that voluntary retirement scheme, I would be happy to consider. CONSTRUCTION INDUSTRY (Release of more public sector work to private sector) 6. Mr Goh Chong Chia asked the Minister for National Development whether he will consider releasing more public sector work to the private sector instead of giving the work directly to Government corporatised companies as the construction industry has yet to recover from the 1997 economic crisis. Mr Goh Chong Chia (Nominated Member): Mr Speaker, Sir, in asking Question No. 6, I wish to declare that I am an architect in private practice. The Minister of State for National Development (Dr John Chen Seow Phun (for the Minister for National Development): Mr Speaker, Sir, the Public Works Department (PWD) was corporatised in 1999 as part of the Government's efforts to progressively devolve its non-policy and non-regulatory functions to the private sector. This would benefit the private sector in the long term. To effect the corporatisation, the Government granted the corporatised PWD a moratorium period of five years starting from 1st April 1999. During this period, PWDCorp Pte Ltd is to continue with architectural and engineering consultancy, project management, and construction supervision for the construction and engineering projects of Ministries. This is to ensure a smooth transition process in the corporatisation.”
“Sir, I am not a HDB tenderer. I presume that anybody who wants to tender for a HDB shop must look into all the factors involved, not just the fact that we are going to adjust rentals. He must also look at the business that he is in, the kind of traffic that is generated by that shop, and a myriad host of many other things. Whether this particular factor alone will give rise to tender prices spiralling upwards, I really do not know. The fact is that they know that we are adjusting everything to market, they know that there is a certain market rental, and then it is up to them to decide how much they want to tender.”
“I am not familiar with the particular example that the Member mentioned. If he has any further details, I will be happy to look into that.”
“Rental reviews and valuation are done on a regular basis. It is being done now on an annual basis. Reviews on a location by location basis are done, but they are staggered. There is a programme whereby rental reviews are done on a locational basis. In the review of the rents, the professional valuers will look at the general location, specific address of the shop, they look at the direction and what the tendered rents have been. They do not just look at the highest rental, they also look at the range of tendered rentals in order to make sure that there are no exceptionally high rentals, as the Member mentioned just now. Is it possible that, in some cases, rentals are exceptionally high because somebody wants a shop very badly? I am told that the valuers also look at such exceptional circumstances, and then they finally come to a judgement as to what is a fair market rental. It is not unexpected that there is a dispute between what the tenant should pay, or what he is prepared to pay, and what the HDB says he should pay. When such disputes give rise to appeals, the appeals would then be adjudged accordingly. Each appeal is looked at seriously, and if there is any cause for revision of that rental for that specific shop, it will be done. Assoc. Prof. Chin Tet Yung (Sembawang): Sir, may I ask the Minister whether the valuation also takes into account the different types of business? For example, I understand that childcare centres operated by private operators have been subjected to rental increases also in HDB estates?”
“That is precisely what we are doing, to try and better cater to the demands and needs of the day. If the shopkeeper finds that he is unable to cope with the rental increases, as I said earlier, there are other avenues for him to continue to earn a living, including subletting his shop, and having sublet his shop, taking that revenue to defray part of the cost of his shop, or assigning the shop to somebody else and still being able to earn some income or, alternatively, exiting from the retail trade altogether. But to subsidise and to continue to subsidise, as the Member is suggesting, some of these shops in order to keep them in business is, I think, not a correct approach for HDB to take.”
“Sir, the HDB's adjustment to market policy has been known. As I said, it has been in existence since 1988. So I presume that those who have tendered would also be aware that HDB is actually undertaking this exercise and that rentals will be adjusted gradually to market for its competition.”
“The market rates are set on a regular basis. Every year, the market rates are set. And looking at the trend of the market rates that I have seen, it went up from 1995, it peaked around 1996/97 and it has started coming down, and today, the posted market rates are about 20% below the peak which is similar to what I see in the private sector market. So to that extent, I would say, yes, the present current market rates are reflective of the current economic conditions. But that is on a general basis. If there are any complaints about market rates not being fair, the Member should bring them to my attention and I will look at it on a specific basis. Because as I said earlier, market rates do vary from location to location and they do vary even within one location, from floor to floor, from direction to direction, and so on. Mr Gerard Ee (Nominated Member): Mr Speaker, Sir, those who have tendered or bought shop units would be aware of the competition and of the rental paid by the competition. Is it therefore necessary or even fair for the HDB to interfere with market forces and adjust upwards the competition cost?”
“They are allowed to sublet their shop, either half or, if they wish to, they can assign the whole shop to somebody else. (2) They can change their trade. If they feel that this particular business is not doing well, they can decide to change the trade to something else, or they can assign it to somebody else to change their trade. (3) They can also decide that they may want to exit the business completely, take advantage of the voluntary retirement scheme (VRS) that I announced in Parliament during the last Budget, take an ex-gratia payment of $48,000, and look for an alternative means of livelihood. MOM has put in place schemes to assist these shopkeepers who do decide to take the VRS to look for alternative jobs, or to go for upgrading or retraining. NTUC has also indicated that they are prepared to bring them into a franchise scheme. So there are various alternatives if shopkeepers are not able to cope with the rentals that have been set for them. But in the first place, I think we ought to make the rentals fair across-the-board for everybody, and then we decide what are the assistance schemes that we can put in place if somebody is not able to cope, and that is what HDB has done.”
“All of them had their rentals adjusted upwards in the course of the last 12 years at varying rates of increase. The last increase was in 1998. In fact, during the last crisis, at the third renewal, rentals were increased, but up to 75%. At that time, when they were renewed for the third time, tenants knew that, at the next renewal, rentals would go up to market. Of course, since 1998, the prevailing market rents have also come down. So when we are talking about adjusting to market, we are actually not adjusting the last 25%, but we are actually adjusting less than that in most cases. There are some cases where the adjustments are slightly higher, but most of the time, the adjustments should be slightly less. And the purpose of all this is really to make sure the cost structure is correct, that the operating environment is fair to all. Having done that, we look at the situation at the moment and we have decided, after a review, that we will do an adjustment across-the-board. And this would benefit everybody, not just those whose rentals have been adjusted upwards, but also those rentals which have been maintained or which have been brought down to market. So everybody still continues to operate on a level playing field. And I think this is the best way to ensure that the shopkeepers are able to compete and compete fairly, and they are able to make a considered decision whether the costs that they are incurring allow them to do the kind of business they want to do. The package of measures that we have announced recently complements this in the sense that for those who find that they are not able to continue to do business at these fair market rentals, there are various options open to them: (1) They can sublet their shop.”
“I turn now to the first question which the Member asked, which is whether these adjustments contradict or run counter to the package of measures. First of all, let me reiterate again the purpose of this adjustment. We need to, first of all, get the cost structure correct for HDB shops. What do I mean by this? If, for example, you have two shops side by side, one paying much lower rental than the other, then obviously it is going to be very difficult for competition to be fair because the cost for one shop is much lower than the other. And this was the situation when we had in many places a lot of resettlement cases. If the Member will recall, resettlement cases were given very, very highly subsidised rentals in the early days. And we now have a situation where we have got people coming in and tendering in the open market. And we have a third situation where there are shops which are now being sold and the new landlords of these shops are now letting out their shop premises. We have got all these different types of shops and the shop tenants in each of these shops are paying different rentals. Obviously, this is not going to make for a very fair competitive environment in the neighbourhood estate. And this is reason why, in 1988, 12 years ago, HDB decided that it was time to gradually remove this anomaly and disparity in rent, so that everybody can start off on the same basis, and that is the only way for the shopkeepers to compete on an equal basis and to decide whether they are able to do that kind of business in that area or not. And that exercise has been going on, as I indicated earlier, for the last 12 years. Many of those shops had their rentals adjusted.”
“Sir, let me take the last question first which pertains to the method of assessing market rates. What are the so-called market rates, are they fair market rates - I think that is the thrust of the Member's question. What HDB does is that it appoints a panel of valuers, and these are private sector valuers, these are not HDB valuers, to assess the market rates based on, first, the rentals that have been tendered in the area, but also taking into account the specific location of the shop, the micro location of the shop, the orientation of the shop, the traffic of the shop, the size of the shop, and so on. So in this respect, the fair market rate that HDB uses to adjust the rentals is a result of professional judgement on the part of this panel of valuers. I think the Member would realise that valuation is not an exact science, there is a judgement involved. But that judgement is exercised by professionals and is exercised independent of HDB. HDB will then take that value and use it as a market benchmark rate. What happens if a tenant is not satisfied with that rate? He has recourse to several avenues of appeal. The first avenue of appeal is HDB itself. He can defer the signing of the tenancy agreement pending an appeal to HDB. HDB will then assess the merits of that appeal and decide accordingly. If HDB's decision on that appeal is still not satisfactory, the tenant has recourse to another avenue which is the Chief Valuer himself. The Chief Valuer is of course the Government's valuer and his judgement can be taken as an independent judgement, independent from the panel of professional valuers that was appointed by HDB. So these are the various avenues of appeal if the tenants are not satisfied.”
“To moderate the impact on tenants who have been paying subsidised rents, HDB staggered the rental adjustments towards prevailing market rate over four renewals, at 3-yearly intervals, in other words, over a 12-year period, starting from 1988. The implementation was also carried out in phases. Tenants who are renewing their tenancies for the 4th time this year were converted to the 3-year fixed tenancy in 1989. They had their tenancies renewed for the first time in 1992 and the second time in 1995. At each renewal, the rental increases were capped at 30% of existing rents. When the tenancies were renewed for the third time in 1998, the rents were raised to 75% of market rate. The final adjustments to market rents are taking place now, at the 4th renewal of their tenancies. Some rents have been increased, while others have been maintained or reduced. By moving all tenants gradually towards the appropriate market rates, HDB ensures that all shopkeepers compete on a level-playing field. This is only fair to all shopkeepers. However, recognising the present difficult economic conditions, HDB will be enhancing the rental rebates for all its commercial and industrial tenants across-the-board. The rebates will provide some relief to all HDB shop tenants, including those whose rents are being adjusted upwards towards market rate. The details of HDB's rebates will be in the package of measures to be announced by the Minister for Trade and Industry in his Ministerial Statement shortly.”
“Sir, as far as changing of use to eating houses is concerned, as I have said earlier, the change of use will only be allowed if it does not cause disamenity to residents. In this particular case, HDB feels that change of use to an eating house will create more disturbance, more disamenity, more noise nuisance to the residents. Therefore, they will not allow this. But they will allow change of use to snack shops and take-away shops which will deal with take-away food. In so far as the second question is concerned, whether HDB will control the tenant mix, the answer is that in the case of new towns or new neighbourhood centres where the tenant mix has not yet settled, where the commercial environment has not yet settled, HDB will not allow a change in the tenant mix for the first three years. But thereafter, when the commercial environment has settled down, HDB will allow freely a change of use, subject of course to the conditions that were stated earlier. HOUSING AND DEVELOPMENT BOARD SHOPKEEPERS (Increase of rentals) 5. Dr Lily Neo asked the Minister for National Development whether he will reconsider the increase of rentals for HDB shopkeepers in view of the plight of the HDB retailers and the present economic downturn. Mr Mah Bow Tan: Mr Speaker, Sir, the increase in HDB shop rentals is part of an ongoing exercise since 1988 to equalise the rentals for similar shop premises so that all shopkeepers operate on a level-playing field. Over the years, a disparity in rent has arisen because some HDB shop tenants are old resettlement cases, paying highly subsidised rates while other tenants have obtained their premises by tender, paying market rents.”
“Mr Speaker, Sir, HDB shop tenants can exit from the retail trade either by terminating their tenancy with HDB or by assigning their tenancy to another operator. As for shopkeepers who own their HDB shops, they can exit from the retail trade by selling their shops in the open market. Every year, about 5% of HDB shopkeepers exit from the retail trade through one of these means. Between 1998 and 2000, there were about 800 terminations, 1,200 assignments and 500 resale cases. HDB also allows shopkeepers to change the use of their shops, except in cases where the conversion is likely to cause disamenities to HDB residents. Between 1998 and 2000, HDB gave approval for 600 shop tenants and lessees to change the use of their shops. This figure suggests that on an annual basis, about 1% of HDB retailers change the use of their shops. A flexible change of use policy will enable HDB shopkeepers to respond more swiftly to the changing needs of HDB residents. Over time, this will create a vibrant commercial environment in HDB estates, which will result in a wider variety of goods and services at competitive prices. This will definitely benefit HDB residents.”
“HDB offers flats in non-mature estates to applicants on the Registration For Flats System (RFS) queue through its quarterly selection exercises. As there is a time lag between application and selection of flat, it is inevitable that some flats are not taken up during the selection exercises for various reasons. These flats are being offered to applicants in subsequent selection exercises. On the pricing of HDB flats, HDB reviews the prices of its flats regularly to ensure that they remain affordable to Singaporean households, especially young couples and low-income families. It also takes into account various factors such as the location and attributes of the flats, and the prevailing prices of resale HDB flats. On payment to contractors, HDB informed me that payment to its contractors is not related to the sale of the flats. HDB's mode and timing of payment to its building contractors, including the retention monies, are governed by the terms and conditions of the building contracts between HDB and its contractors. HDB assured me that it has not delayed the payments to its building contractors. STATISTICS ON SERIOUS CRIMES 26. Mr Zulkifli Bin Baharudin asked the Minister for Home Affairs whether recent crime statistics show that an increasing number of Malays are involved in serious crimes.”
“Under the existing policy, an ex-lessee who has sold his Home Ownership flat in the open market is not eligible to rent a flat from HDB for a period of 30 months from the date of sale. This is to ensure that home owners consider the implications of selling their flats carefully before making the decision. However, HDB understands that there will be households who may be in serious financial difficulties and have no choice but to sell their flats. For such cases, HDB may, on compassionate grounds, consider waiving the 30-month debarment period on a case-by-case basis. PRICE ADJUSTMENT FOR HDB FLATS 25. Mr Tay Beng Chuan asked the Minister for National Development whether there are many units of Housing and Development Board (HDB) flats which remain unsold in the new HDB estates and, if so, whether HDB (i) is considering a downward price adjustment in response to the less favorable market demand; and (ii) will take necessary action to ensure that delay in the sale of newly-completed flats will not cause prolonged delay in the payment of retention monies to its building contractors.”
“Dr Ker Sin Tze asked the Minister for National Development whether the Housing and Development Board is prepared to waive or shorten the waiting period of 30 months for flat owners, who have sold their flats due to financial hardships, to rent a flat in mature estates or in areas such as Sembawang and Woodlands Estates where many flats are unoccupied.”
“For example, among the 227 shop tenants who renewed their tenancies in the last three months, 70% had their rents maintained or reduced. 30% had their rental increased, of which half had their rents adjusted upwards between 10% and 35%. Sir, the Government recognizes that some HDB tenants are facing difficulties in view of the poor economic conditions. Thus, HDB has given rental rebates to its commercial and industrial tenants since December 1997 to help them lower their business cost. The current rebates consist of three categories: (a) an across-the board rebate; (b) a further rebate to reduce rental for tenants paying above market rate; and (c) a rebate arising from property tax reduction, which is passed on by HDB. Taken together, HDB tenants will receive a rental rebate of 12% - 13% for Year 2001. As I mentioned in Parliament on 19th April 2001, HDB is examining whether and how it can provide further assistance to HDB commercial and industrial tenants. HDB is expected to complete its review before the end of this month. Dr Teo Ho Pin also asked "how does HDB compute market rentals?" I would like to inform him that HDB engages a team of qualified professional valuers to determine the market rent for its commercial and industrial premises. In assessing the market rent, the valuers would take into account recent lettings of comparable premises in the vicinity, and make adjustments for the location, size and age of the premises. HDB also allows tenants who do not agree with the assessed market rent to appeal for a rental review or to seek a separate assessment from the Chief Valuer. RENTING OF HDB FLATS 24.”
“Before I address the issues raised by Members, allow me to give the background of HDB's rental policy for its commercial and industrial premises. Prior to 1987, HDB let out these premises on monthly tenancies with rents fixed at the point of letting. Many of the older tenants were resettlement cases who enjoyed concessionary rents. On the other hand, there were some tenants who obtained their premises via tender and were paying market rents, which were much higher. As there was only one rental adjustment between 1960 and 1987, there was great disparity in the rents for similar HDB premises. To be fair to all tenants doing business in HDB premises, and to make HDB rents more responsive to market conditions, HDB decided to gradually move all rentals to market. In 1988, HDB converted all monthly tenancies to fixed-term tenancies and adjusted its rents at every tenancy renewal. For tenants who paid above the prevailing market rate, HDB would reduce their rents during tenancy renewal. Those who paid below the market would have their rents adjusted upwards. For tenants who were on subsidized rents, HDB has staggered the rental increase towards prevailing market rate over 4 renewals, at 3-yearly intervals, ie, over 12 years, to moderate the impact on the tenants. As at June 2001, HDB had 8,400 commercial and 10,200 industrial tenants. Of these, 7,900 commercial and 6,000 industrial tenants were paying below market rate. On the other hand, 300 commercial and 4,200 industrial tenants were paying above market rents, because the market rate has fallen over time. At the point of tenancy renewal, HDB will adjust the rents of both groups of tenants towards market rate.”
“As for John Olds, DBS has stated that he had established a clear vision, guided the development of internal changes in systems and processes that improved the bank's financial performance, helped attract world-class talent at all levels, and laid a strong foundation for future growth. Sir, we are in a new global market environment. We either go with the market, and bring in the best talent to help us compete, or we drop out and accept a mediocre future. Without top talent, we will not be able to build world-class companies that all Singaporeans can be proud of and benefit from. Singaporeans cannot afford to resent the remuneration packages that the top performers in banking, the professions and industry receive. The size of their remuneration is insignificant when measured against the value they create for shareholders, and the jobs and wages that successful Singapore companies will generate. The competition for top talent is intense. If we are not prepared to pay, we will not get the best people, and not even the second best. They will go elsewhere. So if we work up public opinion against the high rewards that the top performers get, our companies are not going to make it, and Singapore is not going to make it.”
“Neither can we restrict ourselves to Singapore talent if we want to build world-class companies and banks. We would be fooling ourselves to think so. Few Singaporean executives have had experience at the senior levels of a globally competitive bank, let alone run a major regional bank. Few have made a name for themselves in the most competitive financial centres like London and New York, and none have reached the top. Singapore companies and banks therefore have to do what it takes to attract the best talent, local and foreign, and get them to work together in a team. If they deliver, they have to be rewarded. If they do not, they will either be replaced or have to accept reduced compensation. The Government does not decide what DBS pays its executives. DBS does not seek Government approval on how it is run or what it pays its executives. It does so on a commercial basis and is answerable to all shareholders, including minority shareholders. But the Government, as a shareholder of DBS, has had no reason to complain about the salaries DBS pays out to its top executives based on their performance. The Government is satisfied to leave these commercial judgments to the Board of DBS. DBS has stated that it rewards its staff when they achieve pre-set targets. 65% of the compensation paid to John Olds and Ng Kee Choe in 2000 was in the form of performance bonuses. They were paid these bonuses largely because they met their targets. Ng Kee Choe's compensation also included his 31 years' retirement gratuity scheme, which was commuted and made as a one-off payment in 2000.”
“The Second Minister for Finance (Mr Lim Hng Kiang) (for the Senior Minister): Mr Deputy Speaker, Sir, the Singapore banks and companies have entered a totally new phase. They are no longer competing in a domestic market, against domestic competitors, and not even in the immediate regional market. They either make it against global players, whether in the Singapore, Asian and global markets, or they get marginalised. If they do not provide customers with quality products and services, equal to the best international players, they lose the business. The banks could rely for many years on protection against their competitors. This will not be possible for much longer. So like other Singapore companies, if they cannot compete with the best they will end up as marginal players, both in Singapore and abroad. They will not grow, shareholders will dump their shares, and they will not be able to provide jobs and add value to the Singapore economy. Singapore companies will only be able to compete with the best international players if they have the talent and management systems to equal the best. This means paying global rates to attract and retain talent, not rates we want to set for ourselves. We do not set the salary scales for top talent, not even for Singaporean top talent. These salary scales are set in New York, London, Silicon Valley, and wherever else global companies hire their staff. It is a global market for talent. Many talented Singaporeans are hired by global firms the moment they graduate, sometimes even before they graduate. The best Singaporean executives are being hired with packages that match their counterparts in developed markets. Local companies will not attract the best Singaporean talent if they pay less than their international competitors.”
“Sir, first of all, let me explain the background to the special S&CC grant. Since 1997, the Government has been helping households living in 1-, 2-, 3- and 4-room HDB flats to cushion the impact of the increase in their monthly electricity and water charges. In FY2000, the assistance given to these households comprised utilities rebates and a special Service and Conservancy Charge (S&CC) grant. The total amount received by each HDB household ranged from $148 to $266, depending on the flat type. This was in FY2000. This year, during the Budget debate in March 2001, the Government announced that it will enhance the utilities rebates for HDB households under a new scheme, called the Utilities Save Scheme. Under this scheme, households living in 1-, 2-, 3-, 4- and 5-room HDB flats will each receive a grant of between $250 and $350 in FY2001, this year, to help them pay part of their electricity and water charges. The scheme will cost the Government $226 million. In dollar terms, for each HDB household, the benefits this financial year under the new Utilities Save Scheme are more generous than the FY2000 package. As the Government will be helping HDB households through the Utilities Save Scheme, the special S&CC grant was not extended after it expired in June 2001. MND and MTI are sending a joint letter to all HDB households to explain why the special S&CC grant will not be extended and why they are better off with the new Utilities Save Scheme. PAYMENT TO MR JOHN OLDS AND MR NG KEE CHOE (Justification) 9. Mr J. B. Jeyaretnam asked the Senior Minister if he will explain why he justifies the payment of $10.9 million in the year 2000 to Mr John Olds, former CEO of the Development Bank of Singapore (DBS) and to ex-DBS President, Mr Ng Kee Choe.”
“Sir, I am afraid there are no such resettlement schemes for businesses which are located in rent-controlled premises. It is for the simple reason, as I said, in the first place, the rent control legislation was not really meant to allow them to operate out of very cheap rental premises. Indeed, we are aware, for example, of many such tenants who have actually sublet their premises at considerable financial gain. Be that as it may, the small and medium enterprises have actually been given, as I said earlier, many years of notice in order to allow them to start to negotiate with their landlords to prepare for the day when the rent control will finally be lifted. So under such circumstances, the Government has no special arrangements made to either relocate or compensate them. If there was any compensation to be negotiated, it should have been done much earlier when notice was first given. THREE-QUARTER TANK RULE FOR CARS GOING INTO MALAYSIA (Suspension) 7. Mr Simon S. C. Tay asked the Minister for Finance, in view of the prevailing high petrol pump prices, if the Government will suspend the three-quarter tank rule for cars going into Malaysia in order to increase competition.”
“Mr Speaker, Sir, the Government was mindful of possible hardship to tenants affected by the abolition of rent control on 1st April this year. Hence, the intention to abolish rent control was announced in April 1997, four years ago. This exceptionally long notice period was to give tenants sufficient time to find alternative premises or to reach agreement with their landlords to stay on after lifting of rent control. The URA also sent reminders to tenants every year since April 1997, and since April last year, every three months. The Government has in place two special housing schemes for residential tenants affected by the abolition of rent control. These are the Old Single Person Tenants' Scheme and the Rent Decontrol Housing Assistance Scheme. Since 1993, out of 502 applicants, 441 of them qualified for either one of these housing schemes. Seven applications were received after 1st April this year when the abolition of rent control took effect. Of these seven, six were eligible for the special housing schemes. The original intention of rent control was to ensure a roof over people's heads, especially during the post-war days of severe housing shortage. It was not meant to provide cheap premises for commercial or other non-residential uses. Tenants who use rent-controlled premises for their businesses or other non-residential purposes have enjoyed exceptionally low rental for many, many years. Such tenants should now look for alternative premises on their own, or negotiate with their landlords for mutually acceptable terms if they wish to continue to stay.”
“Sir, HDB flats are very heavily subsidised by the Government. They are special in that sense, and the Government takes great pains to ensure that their flats are protected. For example, even in the situation where the lessee is made a bankrupt, his creditors cannot touch his flat. That is the extent to which the Government would like to make sure that lessees' flats are protected. So it does not make sense, under such circumstances, to then allow the banks to give a loan based upon the flats. Because, obviously, the banks would want to have the ability to seize the flats if the loans are not serviced. Under the Housing and Development Act, it is made very clear that creditors are not allowed to touch the flats even if, as I said, the lessees are made bankrupt. Therefore, with that kind of protection, it does not make sense for the Government to allow the banks to issue loans on that basis. ABOLITION OF CONTROL OF RENT ACT (Assistance to tenants facing hardship) 6. Mr Tay Beng Chuan asked the Minister for National Development whether his Ministry has considered the potential hardship to existing tenants of certain premises following the abolition of the Control of Rent Act from 1st April 2001 and whether any appropriate assistance will be given to those who are requested by their landlords to vacate their rent-controlled premises and face difficulties in relocating their homes or businesses.”
“Mr Speaker, Sir, HDB flats are intended for owner occupation. As such, HDB will not allow its lessees to use their HDB flats as mortgage for bank loans to finance their businesses. This is because they run the risk of losing their homes, thereby causing hardship to themselves and their families, if they are unable to service their bank loans.”
“EUP is an enhancement to the private estates' ambience, and the EUP is something that the Ministry of National Development hopes to implement progressively for more estates over a period of time. So the EUP and the routine maintenance programme are two separate programmes altogether.”
“We expect about three to five estates to be selected each year under the EUP. The Government will review the number of estates to be chosen and the programme budget, depending on the experience gained from each batch, support for the programme, and whether there are budget surpluses. Mr Noris Ong Chin Guan: Sir, could the Ministry consider whether town councils should coordinate and be responsible for pursuing such improvement projects for private estates within their boundaries, so that priority could be given to estates in need and in an orderly fashion? Assoc. Prof. Koo Tsai Kee: Sir, town councils' mandate extends to the maintenance of common areas. "Common areas", as understood under the Housing and Development Act, means the areas owned by HDB but managed by town councils for the benefit of HDB residents. So town councils have no mandate to manage roads, parks and drains in private estates. Assoc. Prof. Toh See Kiat (Aljunied): Sir, I would like to ask the Senior Parliamentary Secretary whether, because of the EUP that he mentioned, there would be a slow-down or more stringent criteria when non-EUP estates ask for improvements to their public facilities. Assoc. Prof. Koo Tsai Kee: Sir, LTA and ENV have a regular maintenance programme for all private estates. In fact, NParks is also included as one of the agencies. So they have a regular maintenance programme but, of course, once in a while, if they have flooding and trees falling, they can contact the relevant agency to solve an ad-hoc problem. The EUP is a programme provided over and above this routine maintenance programme.”