Ong Chin Guan Noris
Singapore
“After all, a typical agreement for consumer transaction, such as property and cars, is usually very lengthy and couched in terms that would test one's patience in trying to understand it fully. It is possible for these property buyers to miss the fine print in the agreement that expressly takes away third party rights.”
“To this end, I wish to seek the Minister's assurance that there are measures taken to ensure that the CONNECT Plan does not breed a pension mentality among our teachers. After all, the principal aim of this plan is not merely to attract and retain more teachers but to enlarge the pool of dedicated and experienced teachers.”
“I would like to ask the Minister whether the proposals his Ministry is working on would incorporate the speeding up of infrastructural projects. BG George Yong-Boon Yeo: Yes, that is the natural course of action to take. But we have speeded up infrastructure projects as a result of the last Asian financial crisis.”
“Sir, as Singapore is an air transit point for many global travellers, could I ask the Minister whether his Ministry is looking at the ban and confiscation of food and produce brought in by travellers for their personal consumption, eg, meats and dairy products? This is a likely loophole to be plugged.”
“Sir, I hope that the Energy Market Authority of Singapore will adopt a pro-active watchdog role to ensure that the interests of consumers, especially those from the lower income group, continue to be protected in terms of pricing and service quality.”
“What is the average waiting time for taxis in Singapore and how do they fare as compared to other cities? I understand that the supply of taxis is a fine balancing act and that an increase in the number of taxis to cater for the peak hours may result in excess capacity during the off-peak hours and therefore lower income for taxi drivers.…”
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“This will send a strong signal that this House means business when it says that education is so vital for our children that it should be made compulsory. And Government must be prepared to enforce such sanctions to give Compulsory Education the force of law if persuasion fails. It would be better not to have Compulsory Education if we are not prepared to enforce Compulsory Education through legal means as there would be no action that could be taken if repeated attempts at persuasion are ignored, or if the person just refuses to turn up to be persuaded. Penal sanctions will only be a last resort, after extensive efforts in counselling and community mediation have been exhausted. Schools, the Ministry of Education, voluntary welfare organisations, the Ministry of Community Development and Sports and the Compulsory Education Board will play a part in this comprehensive process. This process is detailed in the report of the Committee on Compulsory Education. I believe the Clerk of Parliament has some papers (Cols. 971-972), which I have requested him to pass out, detailing this process. Chart - Mediation Processes for Cases of Non-Registration and Dropout (Cols. 971-972) In the proposed model of mediation and counselling before we take any action, which incorporates existing procedures I must say, the Ministry of Education will identify the children who have not registered with national schools and are not exempted from Compulsory Education at the end of the Primary 1 registration exercise each year. The Ministry of Education will attempt to contact the parents of these children at their last known addresses and find out why these children have not been registered for Primary 1.”
“Several Members have suggested that prosecution should not be the preferred approach, and some Members - Mr Chiam, Mr Iswaran - have also expressed concerns that fining or jailing parents will not help to solve the problem of non-compliance but may instead adversely affect the children and their family and make things worse. I agree with them that prosecution, and certainly jail, is not the preferred or best approach, and I have said so in this House. Persuasion is, indeed, the preferred approach to take so that parents will understand and want to send their children to school to take advantage of the excellent education opportunities available for their children. The Government provides school places for all children who want an education in national schools, and will continue to ensure that no child is deprived of an education because of financial reasons. In fact, primary school education is free and there are a variety of financial assistance schemes in the schools, in the community, from voluntary welfare organisations and, most recently, in the Straits Times, to help ensure that beyond school fees, for the daily needs of the children when they go to school, whether it is pocket money, uniforms, textbooks - there are various schemes to help ensure that children can go to school regardless of the financial situation of their families. Compulsory Education buttresses the commitment of the Government by setting out a framework for counselling, mediation and further rounds of counselling and mediation to make sure that every effort is made to get parents to send their children to school. Indeed, these things are already being done. But if we want to have Compulsory Education and for Compulsory Education to take effect, then penal sanctions must be put in place.”
“With these changes, including Compulsory Education, we can hopefully graduate to a world-class education system where every child really matters. RAdm Teo Chee Hean: Mr Deputy Speaker, Sir, first of all, I would like to thank Members for their views and contributions. Some of them have given extensive recommendations on how to improve the education system which are not directly connected with Compulsory Education, and the Ministry will certainly take on board all these recommendations and study them. Dr Wong has dealt with most of the questions raised by the Members earlier, and Minister Abdullah Tarmugi has also responded to the issues related to madrasahs. I would like to reiterate on this issue of the madrasahs, that the Government had no intention, and has no intention, to close the madrasahs. And quite on the contrary, the Government recognises the need of the Muslim community to train religious leaders from among its own numbers. This is something good for the community and also good for Singapore. I would just like to address one important issue with regard to Compulsory Education before rounding up the debate. This is on the issue related to enforcement. And this is what indeed makes a difference between Compulsory Education from the current situation today where parents can be persuaded, but cannot be compelled, to send their children to school. This is really the basic difference between having Compulsory Education and not. Today there are no powers to compel parents to do so, and no recourse if parents refuse to discharge this responsibility even after all efforts at persuasion have failed.”
“Are we contented to maintain the same teacher-to-student ratio of 1 teacher to about 30 to 40 students, a ratio that we have probably been keeping for the past decades? Are teachers getting enough attention from MOE to help them reduce the administrative workload? Are we creating a conducive environment for our teachers to reach out to individual students and transform their lives? Sir, I support the Bill on the premise that every child matters, especially as we move into the New Economy. Given our population size, the scarcity and value of human resource, every child does matter. If every child does matter, we need to move away from the current system based principally on a mass production process. Sir, I know that most of the issues that I have just raised in relation to the Bill are not necessarily new to MOE. I know that MOE is considering single session primary schools, but is only prepared to make a decision on this in two to three years' time. I know that MOE is seeking to recruit and retain more quality teachers, and with that, we can hopefully have a smaller teacher-to-student ratio. I urge MOE to do so speedily. Sir, many businesses are able to thrive in the New Economy because they dare to adopt a paradigm shift in how they operate. We have, similarly, come to a juncture where a paradigm shift is needed in how we teach our children in the New Economy. The Minister once said, and I quote him, that "In the 21st century, Education must not just respond to change but be at the forefront of change. For education to be relevant, it must embrace change, while remaining rooted in timeless value." I support the Minister in making these changes and urge him to quicken the pace of change.”
“But, Sir, we cannot put the blame entirely on our parents for this kiasu attitude in our education system. If our school system is fully adequate, will there still be such a prevalent need for private tuition? If we have a smaller and more manageable teacher-to-student ratio, such as students get more individual attention from teachers, will private tutors still be in such high demand? If we have single session primary schools where weaker students are given extra coaching, will there still be a need for so much help outside the school system? If we recruit, retain and train more teachers, if we ensure more teaching time for students in school, will parents still need to spend so much time and additional money on their children's education? Sir, the litmus test for a successful education system in Singapore is in making the system so adequate for all students that, parental support aside, there is still need for extra private tuition. If a huge number of students have to turn to outside help, then the system is surely not fully adequate. On this basis, I am not convinced that we are preparing all our students and their parents adequately for the challenges in the New Economy. On the other hand, are we sufficiently preparing our below average students for the challenges in the New Economy? Should the EM3 system be reviewed? Can we do more to help our weaker students? Can we help them and ensure that they have at least the basics before they are allowed to leave school? On the other hand, are our parents unduly stressed and over-taxed due to the inadequate teaching time in our education system? Are our students getting enough individual attention from our teachers?”
“Perhaps, they are partly to be blamed as they inject their kiasuism into the system. But if so many parents engage private tuition teachers, and you are not doing it, you wonder if you are giving enough to your child. Many busy dual-income parents engage private tutors for their children in the lower primary. Many secondary school students have different private tutors for different subjects. The private tuition fee per hour for a junior college student is a hefty $100. Not every parent can afford this. I am not sure what our private tutor to student ratio is, but our ranking in the world must surely be very high. They have been selling photocopied past year test papers for the top primary schools, including papers at the Primary 1 level. Believe me, these are much coveted by eager parents. Bookstores are flooded with assessment books, and there is usually a long queue for these books at the end of the year, because parents want their children to have a headstart on next year's syllabus. Perhaps, this is why we have the undesired tag as being the most-bespectacled nation in the world. It is also not surprising that many of our parents are stressed up when their children's examination approaches. I sometimes wonder who is taking the examination in school - the parents or the children. I know of many working parents who apply leave to coach their children for their examinations, the children's examination, that is. I know of many couples who refuse to have any more children because of the stress of raising children through our education system. Some of these stress factors were self-inflicted and unnecessary. Nevertheless, they are very real to almost every Singapore parent. And the last thing that we all want is a generation of overly stressed-up parents and students.”
“We must provide more support to the voluntary welfare organisations and special education schools helping these students. We must give more recognition to our teachers in the Learning Support and Enable programmes in our mainstream national schools. We must also give credit to the teachers and staff in special education schools for their love, patience and care for these students. My fourth and final point, Sir, is how we are preparing our students for the challenges in the New Economy. I have already mentioned that some Primary 6 EM3 students are unable to construct a grammatically correct sentence in English. Clearly, this defeats a key objective of Compulsory Education. In the past, one reason for keeping the below average students in school is to keep them off the streets. EM3 students can fail all their subjects from Primary 1 to 6 with no risk of being detained in the same level or kicked out from the school. Even if they fail to pick up any skills in schools, at least their time with bad company and negative influence has been minimised. But the New Economy has redefined the requirement of basic skills. It is not good enough just to keep below average students in schools, to keep them off the streets. It is of little use to have Compulsory Education in the New Economy, if some of our students are not equipped with the basics at the end of their learning journeys. We must dedicate more resources to help our weaker students. We should do more to help those weaker students who are under-prepared for the challenges for the New Economy. On the other hand, Sir, we have parents who over-prepare their children for the New Economy. Many parents complain that our education system has become too competitive.”
“But some parents prefer them not to. Some parents want to hide the fact that their children are ESN. Some special education schools are too far away, too tiring and inconvenient for the children. The cost of attending special education schools is also a deterrent. I know that MOE is very supportive of special education schools. MOE has been helping the Autism Resource Centre and the Dyslexia Association of Singapore with their funding and start up of new centres. But the fees are still prohibitive to some parents. For example, the term fee for dyslexic children is $450, not for full-time study, but just for twice-a-week tuition. Not all parents can afford this amount. The long waiting list is another reason. I understand that three new special education schools are being built and another nine are being planned. But they can only be completed in year 2004. This is a very long wait for those on the waiting list. Sir, my third point of clarification is whether MOE can devote more attention to help our less successful students with special needs? Can the Learning Support programme be extended to go beyond Primary 2? Can the Government review its funding level for special education schools, making their fees more affordable? Can we give more recognition to teachers in special education schools, who have a more difficult job than most teachers in mainstream schools? Can we speed up the planning for the nine proposed special education schools and in the meanwhile provide alternatives for students on the waiting list? Sir, if Compulsory Education is premised upon the principle that every child matters, we must do more to help our students with special needs.”
“MOE's Learning Support programme, started in 1992, is an excellent programme, except that it is only for students up to Primary 2. About 12,000 students in Primary 1 and 2 are currently receiving regular, individualised support in language and literacy skills under this programme. The Learning Support programme is supplemented by the Encouraging Achievement and Better Learning programme, or Enable, to help students up to Primary 3 level in English and Mathematics. Students with special needs have benefited from the two programmes. Who are these students with special needs? There are two main groups - those with learning difficulty and those with learning disability. A sizeable number of students experience learning difficulty because they did not fully attend kindergarten classes or face family problems. About 1,029 are born with learning disabilities, like dyslexia, mild autism, attention-deficit-hyperactivity-disorder, or are educationally subnormal. These students are the less successful in our schools. They run a high risk of dropping out from the system. They cannot even read simple words like "the", "cat" or "dog" when they are in Primary 2. If the House agrees that every child matters, I think that we should pay more attention to help those less successful children with special needs. Our mildly autistic and dyslexic children require specialist attention, attention-deficit-hyperactivity-disorder (ADHD) students are often branded as deviants, as the teachers, given the class size that they have to manage, cannot give these students the attention that their condition demands. Educationally subnormal (ESN) students are those with IQ between 50 and 70 and need more individualised coaching. Students with learning disability may attend special education schools.”
“Some parents do not send their children to kindergartens simply because of the fees involved. It is much dearer than the subsidised primary school fees and the amount vary according to the prestige and facilities of the kindergartens. I am sure that MOE understands that children left out of PSE have to play catch up on Day 1, and that the disparity in standards can be quite startling. I am glad that the Minister recently announced in MOE's workplan seminar that MOE intends to devote more resources to give Singaporeans a headstart in PSE and to review the PSE syllabus. We should, and I quote him, "give every child a fair shot at achieving his or her hopes and aspirations." It is in this context that I pose my second point of clarification to the Minister. Can we give every Singapore child a fairer opportunity to enrol in a PSE institution? Can we keep PSE fees at an affordable rate for the lower-income families? How much would it cost to provide subsidies to all kindergartens to make the fee more affordable? We have a much more intelligent new generation. Should we consider if Compulsory Education should begin at PSE level? My third point, Sir, is that there is a need to review how we are educating our less successful students. On a national basis, we have been adopting people-oriented policies to help the less successful in society, and we also pay more attention to help students with special needs. Sir, our concern must not end with just simply implementing Compulsory Education. Our responsibility extends to ensuring that proper and adequate assistance is given to all our students so that their learning journey will not lead them to a dead end. It is to MOE's credit that it seeks to address the special needs of students who are slow learners.”
“Given the current resources available, when does the counselling process end - will it stop once the child returns to school or will there be follow-up counselling and assistance to parents and students? What steps will be taken to help our schools to be more proactive in identifying in helping struggling parents and troubled children? The second point, Sir, is that to render Compulsory Education more effective, all children should begin their learning journeys on a fairer footing. According to the Bill, Compulsory Education will begin only at Primary 1 and not earlier. This means that children with pre-school education (or PSE) have a headstart over those with no PSE. Children who did not attend kindergarten classes are way behind the starting line when the Compulsory Education whistle is blown. Sir, I am not exaggerating. To illustrate my point, I know of a kindergarten requiring its student to spell our national pledge. Can you imagine the kindergarten students spelling, "to build a democratic society, based on justice and equality, so as to achieve happiness, prosperity and progress for our nation"? The fault-line for the digital divide really begins very early. I am also told that some kindergarten children already know how to make a simple Powerpoint presentation. Nowadays, children who have completed PSE are expected to spell and read simple words, not just alphabets, and have attended computer enrichment classes. When you put these children together with those who did not go through PSE, slower learners will lose their confidence and may even be labelled and stigmatised. They are not necessarily slower due to a lower IQ but because of deprived opportunities and the lack of PSE.”
“Our assistance to struggling parents and children should not be on a reactive basis. We must not apply the counselling medicine only when the trouble sets in, only when the child has stopped attending school for a few days. We must instill in our teachers the mindset that every student matters. Our teachers must be trained to have a keen eye to nip problems in the bud. They must be assured that when they encounter difficult cases that they cannot handle, there are adequate specialist resources to back them up. Sir, if we are serious about helping every child, then we need a more proactive and ongoing assistance process, it cannot be touch-and-go. We must not be satisfied with just giving the child back to school. We can only be contented when we see a motivated child returning to school with full parental support. For this reason, we should provide our schools with additional resources to achieve this. The Prime Minister stated in his National Day Rally speech that he has asked MOE to see how our schools can be provided better administrative support so that teachers can spend less time on administration and more on teaching. I fully support the Prime Minister's initiative. May I add, in relation to this Bill, that schools should also be given more counselling and specialist support so that teachers can devote more time to teaching. In any case, not all teachers are gifted to counsel. Those who have just graduated are too young and inexperienced to handle difficult cases. Hence, my first point of clarification to the Minister is whether there is any intention to shore up the resources to help teachers, especially in the neighbourhood schools.”
“Assistance to parents and schools Firstly, our schools must be given sufficient resources to prepare our children for the New Economy challenges. Let me elaborate on this point. MOE correctly recognises that the critical success factor in implementing compulsory education is not by imposing fines or jail terms. These are deterrents that we hope will never be effected. These are measures that will end up punishing both the parents and the children. Instead, there will be a mediation process involving MCDS and voluntary welfare organisations to help parents and children. Non-registration and drop-out cases will not be referred to the courts unless the counselling and assistance prove to be unsuccessful. I fully agree with MOE's approach. But I am concerned as to whether we are fully equipped to deal comprehensively with all counselling and assistance cases. The Committee's Report indicated that the number of parents with financial or family problems is very small. These are the only known cases surfaced to MCDS for assistance. I am concerned that the number may not be reflective of the situation faced by some of our neighbourhood schools. Is this number only the tip of an iceberg? I am sure that there are many unreported cases of parents struggling to put their children to school. Some parents do not seek help because of their pride, or because they are too busy to pay attention to their children. MOE's team of psychologists and guidance counsellors and the teachers in our schools may be able to cope with the situation now, but you need time to deal with such cases. You need additional resources, more specialists, to provide proper and proactive counselling to struggling parents and children.”
“The warmness of a genuine heart can melt an iron resolve. I am encouraged to note from the Committee's very well written Report, that they undertook a rigorous consultation process. I am also extremely delighted that an agreement has been reached with the madrasah leaders on how to move forward. The Bill has provided the flexibility for exemptions to be made in this regard. The Report also indicates that non-registration and drop-out cases are very minimal. I am thrilled that the Ministry's serious intent to upgrade both the hardware and software aspects of education has started to bear fruits. In terms of its vision, purpose and articulated plans, MOE has done very well. But, there is a reality gap between what MOE intends to achieve and the current situation. How well equipped is every one of our children for the New Economy? I do not think that we are up to the mark yet. We still have a long way to go. We still have a long way to go, because I know for a fact that some Primary 6 EM3 students are not even able to string together a grammatically correct sentence in English. Can we say that these primary school leavers have been equipped with the basics to face the New Economy challenges? I do not think so. Sir, we must not content ourselves with just casting the education net over the entire cohort using this Compulsory Education Bill. Casting this net is but a prelude to a more important task - that of preparing the next generation for the challenges ahead. We must not only be aiming for a 100% attendance figure. We must go beyond the statistics and honestly ask ourselves how well we have taught all our children. To this end, I wish to raise four main points for the Minister's clarification.”
“Mr Deputy Speaker, Sir, the wealth of our nation lies in our people, especially in our next generation. Our future in the New Economy will depend on how well we equip ourselves and the next generation of Singaporeans for the challenges ahead. Towards this end, this House has been focusing on people, seeking to put in place people-oriented policies to address the needs of the elderly and less successful, to cultivate an attitude of lifelong learning, to bridge the digital divide, to forge social cohesion, and to encourage active citizenship and closer bonding between the various racial and religious groups. These people-oriented policies will help our generation to collectively face the New Economy challenges. But it is not enough. We have the responsibility to ensure that every one of our next generation is also equipped with the basics to face the New Economy challenges. It is in this context, Sir, that I speak in support of this Bill. Sir, teaching our young ones is such an emotive subject. Almost everyone has a personal stake in it. Almost every parent wants to have a say on it. Almost everyone has a statement to make and expectations to raise. Almost everyone has his own concerns about how his children ought to be educated. Some concerns, on the one hand, are justified and deserve closer attention. I shall elaborate on them later on. On the other hand, there are concerns based on parochial interests, without a fuller understanding of the long-term consequences or impact on our nation. We must not dismiss such concerns lightly - both now and in future. To do so, is to seriously under-rate the emotions of the individual and the community on this emotive subject of educating the young. Instead, we need to be perceptive, sensitive and patient.”
“Our Minister at Staff Grade 1 is only ranked 367th, which again is grossly disproportionate as compared to a person of the same calibre in the marketplace. And using the ranking as a reality check, I believe that the proposed benchmark revision is reasonable. I suggest that we should not view the remuneration of our Government and political leadership entirely in market terms. I suggest that we should not deceive ourselves and say that all Government leaders be only driven by their self sacrificial public service spirit. Let us be realistic about it. Let us try to marry the need to be driven by the market and public spiritedness. The test of the worth of the Government and political leadership is in times of crisis. Can they stand the test? They have done so repeatedly, and again in the recent economic recession. The litmus test for the political leadership is in the elections, just like the private sector. If we feel that the management team has done a lousy job, the shareholders can convene to dispose them. We have an increasingly sophisticated electorate. I believe that they understand the need for good government. I believe that they understand that good things never come cheaply. Likewise, there is a cost to good leadership. Sir, I support the DPM's ministerial statement.”
“The typical image of a civil service is that of an ageing, inflexible bureaucracy, a fogy old man holding the reins. A typical image of the Singapore civil servant must be one with the attitude of agent Ethan Hunt in "Mission: Impossible 2", highly skilled, IT-savvy, high IQ, high EQ, excellent network of contacts and gutsy enough to make calculated risks. I believe that with the proposal set up in DPM's statement, we can take heart that we will have to place a continual leadership renewal process in the Government. I believe that the DPM's proposal will help to maintain the average age of senior civil servants. By instituting a 10-year term, the Government will send the right signal that it is no longer an iron rice bowl. It will allow Administrative Officers who have completed a 10-year term to bow out gracefully, should they choose to do so. This in turn will generate more opportunities for other competent Administrative Officers to rise to the top. My second observation concerns the review of the salary benchmarks. I believe it is a timely exercise and will even go as far as to suggest that it should be conducted every three to five years. So far, we have heard ample suggestions on how to compute the Ministers' benchmark. Which is the most acceptable one? In my opinion, we should not trip ourselves on the technicalities of the benchmark formulas. We should not be overly concerned regarding whether we cut it fine enough. Rather we should use the ranking as a sanity or reality check to ensure that the pegging is at the right level. For example, the Prime Minister is ranked 63rd after the salary revision. Given his duties and responsibilities as the Executive Chairman and CEO of Singapore Inc, he must be grossly underpaid in the marketplace.”
“Mr Speaker, Sir, it is not by chance that the citizens of a small resource scarce country can live peacefully, comfortably and ably, equipping itself to face the challenges of the new economy. It is not by chance that the Singapore economy made a V-shaped recovery from the recent stormy recession. It is not by chance that we can boast of Ministers of integrity and competence, and who can carry themselves well in international forums. Sir, the preservation of a good, efficient and honest Singapore Government in the new economy is too crucial to be left to chance. We should put in place a mechanism to help nurture this. It is on this basis that I rise to speak in support of DPM's ministerial statement. Sir, I would like to make the following observations: Firstly, Sir, the Government's recognition of the impact of the new economy on the Government and the aspirations of young officers is most timely. What is the new economy? I do not think that anyone can readily claim full knowledge of the new economy, as the very nature of the new economy is that it is ever changing. But one thing is certain. The fast pace changes will generate opportunities, such as the sprouting of dot-com companies and life sciences. These opportunities will come by swiftly. Unless we position ourselves well and ahead of time, we run the risk of lagging behind in the competition. Given our natural resource constraints, Singapore cannot afford any slip in our competitiveness. What this means is that we need to have a government that keeps pace with new trends and developments, has the capacity and audacity to act promptly, has senior civil servants who are willing to read up on life sciences in order to grow the Singapore economy. In short, we need a vibrant civil service.”
“If they select completed flats, they can take possession of the flats within a few months from selection. Furthermore, first-time purchasers can buy resale flats or Executive Condominiums with the CPF Housing Grant Scheme. The grant of $30,000 to $40,000 will help to defray the initial cost of purchase of their resale flats or Executive Condominiums.”
“Sir, as part of the review of the legislation, would the Minister also consider legislating a cooling off period from the date of signing the agreement, so that a prospective investor will have more time to consider his intentions before activating the investment account? BG George Yong-Boon Yeo: Sir, we can consider such a provision. But we have got to look at it from all angles to see whether it sets a precedent for other transactions which may become a problem. But we will consider it. HOUSING AND DEVELOPMENT BOARD FLATS (Enhanced incentives for first-time buyers) 7. Dr Lily Neo asked the Minister for National Development whether his Ministry will further enhance incentives for first-time buyers of Housing and Development Board flats so as to assist young couples start their homes and families earlier. The Minister of State for National Development (Dr John Chen Seow Phun) (for the Minister for National Development): Mr Speaker, Sir, the HDB has several schemes to assist young couples to start their homes and families earlier. Firstly, HDB flats are sold at subsidised prices to ensure that they are affordable to young couples. Next, HDB provides mortgage financing at concessionary interest rates to first-timers. HDB flat buyers can make use of their CPF savings to pay the 20% downpayment. HDB also has a Fiance/Fiancee Scheme whereby young couples intending to get married can apply for new HDB flats before their marriage. For those on the Registration for Flat System, HDB allocates more flats to first-timers compared to upgraders, to enable the former to start up their homes earlier. Today, first-timers can select their HDB flats within one to one and a half years from the date of application.”
“Would the Ministry consider opening up the attractions free of charge to the public, as in the past, as heritage attractions, in the case of Haw Par Villa?”
“Can I ask the Minister if there are any studies to substantiate that opening more legal betting outlets will help to reduce the number of illegal betting outlets? That is the first question. Second question: May I ask the Minister whether, as a means of counter-balancing any ill social effects of making betting outlets more accessible, there will be a public education campaign, similar to the anti-smoking and anti-drinking campaigns, to remind the public of the ill-effects of gambling or excessive gambling?”
“These adjustments are spread out during the year and therefore price adjustments also quite reasonably ought to take place during the year. The key question, as I have pointed out, is whether the cumulative effect of all these price adjustments is a high inflation rate or a low inflation rate. I have pointed out that, in fact, we have ended up with a very low inflation rate. In fact, it was negative for several years. Last year, it was less than 1% and this year we think it will be less than 2%. CPF has gone up 2% already - that is not take-home pay - but I am quite sure take-home pay will go up by more than 2% this year, because the labour market is so tight. These are adjustments which we have to accept. If inflation goes up 5%, 6% or 10%, then there is reason for people to worry because that is very big and you are unable to plan ahead and maybe if oil prices shoot through the roof that might happen - it has happened before - but that is not the situation we are in today.”
“Two supplementary questions. I would like to ask the Deputy Prime Minister if there are any coordinated efforts by the Government, for example, by way of an inter-ministerial committee, to consider the impact and timing of price hikes for public amenities, facilities and services by the various ministries. The second question is that for the timing of future price hikes within the control of the Government, will consideration be given to take into account the fact that salary increments and bonuses are usually given once a year and that there are still many months to go before the year-end increments and bonuses materialise? BG Lee Hsien Loong: On the first question, we do coordinate among the ministries. We do not have a formal committee, but we do coordinate among ourselves, because it does not make sense for us to have several sudden adjustments taking place one after the other and causing an unnecessary shock to people when very often, in fact, there is no reason to be shocked. The second question is whether we should therefore take into account the timing of the private sector salary increases which happen once a year. I would suggest that if we make all our price increases once a year, that might cause bigger shocks, rather than smaller shocks. I do not think all the private sector salary increases take place at the same time. The NWC makes its recommendations in May or June and companies take a few months, and some take many months, before they settle the agreement and then they are paid. Collective agreements come due at different times. Some bonuses are paid at the end of the year and some are paid in the middle of the year.”
“The Government should lead this change to promote this renewal and stance for Singaporean entrepreneurs to factor-risk into their business strategy and the Government should send the correct messages through this budgeting process.”
“For this purpose, I suggest that the Government consider granting topping up of students' Edusave accounts to subsidise or pay for the purchase of personal computers. The top-up can be reviewed five years later to keep up with the changes in computer technology. This amount in the Edusave account will be for the sole purpose of allowing students to own a personal computer at home such that a programme can be put in place by the school to effect learning at home. On a final note, I cannot help, just like my other colleagues here, but notice the glaring disparity between what was budgeted last year and the eventual out-turn. I understand that the V-shaped recovery is remarkable. I understand that revenue collection has not fallen last year and that development expenditure intended to stimulate the economy is no longer required. What all this adds to, of course, is that we have over-budgeted last year under exceptional circumstances. But when I cast my eyes back to the previous Budget estimates, I wonder if the Government has developed a trend of over-budgeting, albeit in smaller amounts. I wonder if the buffer built into previous Budget estimates could have arisen out of a mentality of conservatism and safety nets. A conservative mentality that was, and probably still is commonly associated as being symptomatic of the bureaucraticism in the civil service. I hope not. But it is a side message emanating from over-budgeting. I hope not because in order to adequately meet the millennium challenges head on, we need both the private and the public sectors to be more rigorous and less risk-averse.”
“This would encourage Singaporeans to adopt a wider investment strategy rather than to be overly tied down and exposed to the property market. My second concern deals with the personal reliefs generally. Such reliefs do not appear to have kept up with the times. We have introduced business tax measures to keep up with the move towards technopreneurship in the economy. We should consider measures to keep up with changes in society. For instance, the personal income threshold of $2,000 for the wife relief does not appear realistic given the financial pattern of today's families. I suggest that we look closely at the current programme of personal reliefs to determine where improvements can be made. One area which seems to be of concern to a growing number of Singaporeans is the cost of medical treatment for their ageing parents. Perhaps, the personal tax system can be used to help alleviate some of their concerns. Thirdly, I would like to propose the topping up of students' Edusave accounts to encourage PC ownership. We want to encourage our students to be more IT savvy. Not every student can afford a personal computer. While there are personal computers in schools, the IT exposure of the students without personal computers at home is very much restricted. Sir, IT has increasingly become an integral part of how we educate our next generation, both during and outside school hours. In this regard, we should level the learning field for our students by giving each and every student the opportunity to widen their learning experience through the use of a personal computer. We should make personal computers an essential part of the home, as much as telephones and television sets are.”
“In light of this scrutiny, we need to carefully consider how best to motivate companies to make more widespread use of such schemes when warranted and we need to determine how best to motivate key employees in an organisation to take long-term stakes in the company they work for. We have seen in the past how speculation, be it in the share counters or properties, destabilises and undercuts the society's economic and social progress. We need policies that encourage people to take a longer term view of things. I, like the rest of the business community, will wait with interest for the details in respect of the stock option scheme. However, I would encourage the Ministry to improve the taxation of such schemes to encourage the long-term development of the stock option schemes. Besides proposing tax initiatives to face the challenges in the economy, I would also like to very briefly comment on a few other issues. The first is the need to review the threshold parameters for estate duty. For example, in relation to estate duty, the use of $600,000 as a threshold for non-property exemption seems to be inadequate. After all, the $600,000 is inclusive of CPF which nowadays, as a result of higher income and better investment opportunities, is easily achieved. The current exemption scheme appears to favour the very wealthy, or at least those with significant property ownership and their investment portfolio. Consideration should be given to revising upwards the non-property exemption to allow or, more radically, abolishing estate duty on all non-property assets and allowing for estate duty to be levied only on real properties passing in excess of, say, $9 million.”
“The Minister, in his Budget speech, stated that only employees will be eligible for the Supplementary Retirement Scheme. It does not appear that any provision has been made to allow entrepreneurial business owners, such as the self-employed like sole proprietors and partnerships, to take advantage of this scheme. It appears strange that the scheme does not apply to SME entrepreneurs who are willing to take risks in the prime of their life. There is no guarantee that their ventures will succeed. There is no certainty that having risked it all, they would have enough for their old age. As it is, the CPF contribution rate for the self-employed is already capped at $14,400 per year. Is this enough for them in the long-term? What if their businesses do not prove to be successful in the next recession? Should we try to help them build up their reserves as well? Depriving entrepreneurs of the old age safety net may not be the way to forge a more risk-taking mentality among Singaporeans. We need to support them by putting in place provisions to facilitate their personal financial planning for old age. We need to ensure that any Government initiative does not indirectly prejudice their ability to achieve long-term personal financial goals. For these reasons, we should make the scheme open to self-employed entrepreneurs in addition to employees. In line with the Government's desire to create a more innovative business environment and consistent with remuneration trends in the world of technopreneurship, the Government has introduced provisions governing the taxation of employee stock option schemes. The business community, as a whole, is encouraged by the Government's plan to improve the tax treatment of such schemes and has much focused in this area.”
“We can assist such companies by allowing them to accumulate expenses in periods when no income is earned and allowing them to deduct such expenses when the investment starts to produce income. Such rules could be targeted specifically to costs incurred in regional expansion activities, such as funding and legal costs, and would help companies that are starting to plan for regional expansion. The tax authorities already administratively allow expenses to be accumulated and deducted in future years where foreign income is earned, but not brought into Singapore in a given year. It is not such a great extension to allow expenses to be accumulated on certain expansionary activities to be treated similarly. On top of helping companies to get started in regional expansion, we should also think forwardly and consider how best to allow successful companies to reinvest their overseas profits. Currently, foreign taxes paid by a second or third tier of foreign company may not be recognised in Singapore when the Singapore parent company receives dividends from its overseas subsidiaries through an offshore intermediate holding company. Since credit is not given for such foreign taxes suffered at the second and third tier level, the overseas income that is brought back to Singapore is effectively taxed twice, once by the foreign country, and once by Singapore. This may act as a disincentive to a Singapore company that has been successful abroad from reinvesting in Singapore even if the best opportunities are available at home. We should remove this potential road-block and, as a general rule, allow companies to look through intermediate holding companies in foreign countries and receive credit for foreign taxes paid. I now turn to issues affecting individuals.”
“But the willingness to take structured risks may manifest itself in operational structures, giving rise to quarantine losses. Our tax rules do not permit losses in one company to be offset against profits in another company even if one person owns both. If the two businesses were run out of the same company, the losses would implicitly reduce the profits resulting in less tax. In effect, by not allowing inter-corporate losses, and I use the term loosely, the effective tax rate is actually higher than 25.5% for the above companies taken together. In line with certain other countries, I suggest we seriously look into the concept of group loss relief. The structured separation of businesses and risks into separate companies should not lead to the very real problem of taxing a corporate group at a tax rate that is effectively higher than the statutory rate. I would now like to focus on the other possible tax measures to boost our regionalisation efforts in an increasingly globalised world. Risks are involved for companies going regional. Investment and external financing are required. Interest costs, in some cases quite substantial, are incurred. In initial years, the company invested may be expected to operate with little, if any, profits. It will take time for them to build up their reserves in order for such companies to repatriate profits back to Singapore. We can try to minimise the time needed by local companies going regional to build up their reserves. We can try to help our local companies to be competitive in a global environment. Current tax rules do not allow funding costs to be deducted if the investment does not produce income. This serves as a disincentive for local companies to seek regional expansion opportunities.”
“A conducive physical environment should be part of the blueprint for local SME growth. Instead of a flat corporate income tax rate for all companies, we might consider implementing a lower rate of income tax for local SMEs. SMEs that are wholly owned by Singaporeans could be subject to a lower rate of tax, say, 16% on the first million of income which is ploughed back into the business and not distributed as dividends. Low rates will allow the SMEs to build up their reserve to better weather economic downturn that will occur in the future as part of the normal business cycle. For the purpose of helping SMEs still suffering from the lingering effects of the recession, consideration should be given to allowing SMEs to use losses incurred during the recession years of 1998 and 1999 against income earned in previous years. This ability to so-called "carry back" losses would greatly benefit SMEs that are facing cashflow problems and financial difficulties now. The current tax rules allowing for the carry forward of losses is only of benefit if a company actually survives the recessionary years. While on the topic of providing relief for tax losses, I would also like to raise the issue of corporate group relief for losses. Businesses under the common control of a shareholder, or group of shareholders, may be organised in separate companies for a variety of reasons. This corporate separation, while real in the legal sense, is artificial in the business sense from the perspective of the owners. We hear the Government's message that the more entrepreneurial approach of style is needed to sustain us beyond the millennium in the face of the tough regional competition.”
“What happens when the twin forces of IT and globalisation require stronger response from the Government? What are some positive tax initiatives to accelerate the path to become the Asian Silicon Valley and to maintain our position as the regional business hub? What tax measures can be considered to encourage our local companies to think bigger, enter into new markets and invest more boldly? How can we give a tax boost to companies that are still struggling from the lingering effects of the economic downturn? We ought to visit these issues and attempt to answer these questions. Firstly, companies that are still facing economic difficulties. The V-shape rebound is understandably met by a U-turn in recession year tax rebates. The conditions for these rebates were laid out beforehand by the Minister. Once the economy improves, the rationale for the rebate collapses and reason compels that the rebates be removed. If specific business sectors require a post-recovery boost, new tax measures should be designed to deal with a specific issue at hand. This seems to be the measured approach adopted for this Budget. But, Sir, have companies and businesses recovered entirely from this recession? Statistics suggest that our growth is not broad-based across all sectors. In the course of my day-to-day business dealings, I have also come across many people who feel that we are not fully out of the woods. Many SMEs are still struggling. Many SMEs bore the brunt of the recession, much harder than larger businesses. The withdrawal of rebates will again hurt them harder in relative terms as compared to larger businesses. Sir, if we are genuinely concerned about growing our local SMEs into world class companies, we will need to create a conducive environment for them to grow.”
“Mr Speaker, Sir, over the years, it has become a somewhat popular Shenton Way tradition to attach terms to describe the Budget. This millennium Budget is no exception. Some have called it "The Good Old Budget" in respect of the SRS and tax reliefs for dependent parents and aged grandparents. Others have called it "The Cyber Budget" in recognition of the tax initiatives for an increasingly borderless virtual world. But it is a bothersome Budget for taxpayers who were disappointed by the full or partial withdrawal of a number of rebates. In this regard, some have even called it "The Withdrawal Budget". Some of these are quite unfair terms that have been coined out of parochial interests. It is unfair because people conveniently chose to overlook a possible GST hike that did not materialise. It is unfair because people chose to forget the conditions attached to one-off rebates. Personally, I prefer the term "measured Budget" for the Minister's measured fiscal response to the millennium challenges. It is a measured response because the withdrawal of each rebate appears to be followed by a concomitant new tax initiative. It is a measured response because while we see great challenges ahead, we must not lose sight of the lessons that we have learned from the recession, that we need to remain competitive, that a continued bright outlook is sometimes contingent upon forces and factors entirely beyond our control. And so, Sir, there are merits in adopting a measured fiscal approach. For this reason, I support the Budget. But I would like the Minister to consider a scenario that assumes the challenges to be somewhat more compelling and that requires a slightly more rigorous fiscal approach.”
“Otherwise, the whole neighbourhood will soon know about it. When tongues are set wagging, some home detainees and their family members will fail to deal with the stigma. When this happens, the scheme will backfire and become dysfunctional. Instead of being reintegrated, the scheme may end up disintegrating the whole family. In this regard, may I ask the Minister whether any steps will be taken to minimise the stigma of home detention and to help home detainees and their family members to be prepared for the social and psychological stigma associated with the scheme?”
“This is because the performance standards, services and facilities of half-way houses may vary too significantly. A benchmarking of the standards of half-way houses is important in this regard. Some degree of recognition and support for half-way houses is also in order. For my fifth point of clarification, may I ask the Minister whether an extension of the home detention scheme to relevant half-way houses has been considered? Finally, I turn to the family home detainees who are generally supportive. The family is one of the critical success factors for the scheme. It may not be so in the West because, given their cultural practices, it is conceivable that many home detainees there do not live with their families. But this is generally not the case here. Home detention here can literally mean being detained with the family. A family may seem to be supportive, but we have to recognise that it is one thing to express support and another to be able to deal with the difficulties and shame of living with a detainee. The family has to learn to adjust and accept the concomitant stigma, but not all family members can manage that successfully. The mother may accept but the father may resent. The sister may bear with it but the brother may find it embarrassing and disgraceful to stay at home with the detainee. And when a family dispute erupts, the detainee cannot run off to cool himself down. Not all neighbours can accept living near a detainee either. It is possible for the family to conjure up excuses to explain to their neighbours and relatives regarding the absence of the prisoner from home. But having the detainee locked up at home is altogether a very different thing. Hopefully, the spot checks on home detainees will not be conducted by uniformed law enforcers.”
“Sir, if there is a corrective work order for litterbugs, why cannot there be a corrective social work order for social bugs? Not all social bugs are social menaces. Social menaces should be put away from arm's reach. Some minor social bugs can perhaps be disinfected of their ills by a dosage of corrective social work order. In this light, may I ask the Minister whether he will consider broadening correctional sanctions further to allow minor offenders to perform community services? Fifthly, should the home detention scheme always take place at home? The home environment is not necessarily the best rehabilitation centre. Some offenders are in prison precisely because of the lack of guidance at home. The lack of parental support has driven some to bad company and subsequently to prison. If the root of the problem is at home, why send them back to their homes? In such cases, putting them back to their homes is likely to be counter productive. But does this mean that the offenders must have a supportive home environment in order to qualify for the scheme? I hope not. If penitent offenders do not have a favourable home environment to return to, perhaps they can be detained in some established half-way houses instead. It is no secret that some of these half-way houses are founded by ex-convicts. They know what it takes to turn over a new leaf and want to help others to do so. The environment in these half-way houses can be more rehabilitative than the home environment. The sharing of positive experiences, bonding and encouragement can do these detainees a world of good. But there must be a review of the programmes, funding level and management practices of half-way houses.”
“The other part involves providing structured programmes to occupy their daily routine. Meaningful activities should be included, such as skill upgrading to help the detainees to find suitable jobs later on. Perhaps, the activities also can benefit the community so that there will be a pay back redemptive effect. My third point of clarification to the Minister then is how much free time do home detainees have. What kind of rehabilitative programmes would there be? This leads to my fourth point regarding community service programmes. Community service programmes can supplement the home detention scheme and acts as an additional intermediate sanction. Any minor offender, not necessarily just home detainees, can be put on community service programmes. For example, minor offenders can be made to help out in places like nursing homes or centres for the disabled. They can be assigned simple tasks that require some degree of contact with the elderly or disabled. Minor offenders may find it to be extremely therapeutic when they are exposed to the pride, strength and character of the elderly and disabled. It may even help to change their value system for the better. But such a programme must be managed properly and discreetly. In some countries, as part of their sentence, certain offenders have to conduct talks in schools or advise troubled teens. Some convicted sports personalities conduct sports clinics followed by counselling sessions for juveniles. Along this line, is it not better for a convicted computer hacker to help non-profit organisations to create websites, design software programmes, conduct basic IT training rather than for him to rot in prison for the entire period of his sentence?”
“We cannot legislate to deny a home detainee the pleasures of his home for what is there to prevent an affluent detainee from enjoying movie after movie on an ultra modern high-tech big screen home entertainment system together with his family, or hours and hours of Internet surfing, or a nice sun tan after a leisure swim in his private pool, or a home party on Saturday night with his and his family friends. Sir, I am not exaggerating. Some years back, a son of a former Amercian Vice-President candidate was sentenced to four months of house arrest for selling cocaine. The home detention was as good as an extended resort holiday. He lived in a luxury apartment, with maid service, cable TV and many other expensive amenities. This led his prosecutor to observe that the drug felon was living in conditions that 99.9% of the people in the area could not afford. Too much free time can be bad for the less affluent detainees too. A home detainee cannot roam the streets. But in the confines of his small HDB flat, he is exposed to the temptations of the streets through his friends, family media. Some of these influences and friends may not be good for him. They may numb him to forget that he is still serving his sentence, albeit at home. While there are devices to ensure that he does not leave his home, we cannot legislate against such influences from entering his home. Sir, a new freedom can be a dangerous thing. When we feed idle minds with bad influences, they will breed crooked schemes. Restricted freedom strengthens the resolve for some, but for others, it propagates jealously, resentment and bitterness. To put it simply, home detainees should not be left to their own schemes. Thus, detaining offenders at home is only part of the rehabilitated solution.”
“Firstly, can the Minister clarify the types of inmates who can qualify and benefit most from the scheme? It is in the public interest that the selection guidelines rule that violent and dangerous criminals, murderers, rapists and other inmates convicted of serious crimes should be automatically disqualified from the scheme. They deserve the full prison sentence. There should be no exception to this. But what are the other criteria - family support, good prison behaviour, age? Will these criteria be transparent to the inmates? Are there studies to indicate that certain targeted groups of offenders will benefit most from the scheme? Sir, I believe that the home detention scheme can help to steer misguided offenders back to the right path. But what numbers are we referring to here? This leads me to the second point of clarification. Can the Minister provide us with an estimate on the percentage of prisoners who potentially qualify for the home detention scheme? How many detainees, fitted with the EM device, can the community expect at any one time? Does this number affect the Government's plan on the number of prisons to be built in the future? Thirdly, what will the detainees do at home? The scheme provides the offenders with a measure of freedom. My concern is that when they are taken off the discipline of regular physical exercise, prison chores and solitude, what are they going to do with their free time at home?”
“Sir, I rise to speak in support of this Bill. Dangerous and violent criminals deserve to be incarcerated for long periods of time. But for less serious offenders, I see the merit in applying correctional treatment to re-integrate them into the community. I see the social value in having a home detention scheme to minimise the negative socialisation that occurs in prison. It is assuring to know offenders placed on Electronic Monitoring (EM) schemes in other countries register lower recidivism rates. But the success rate varies, and the EM may be more effective with some groups of offenders and at certain stages of the rehabilitation process. A group of American researchers found that EM works better with offenders who have had a taste of prison detention. Apparently, juveniles seem to respond better to EM than adults. EM also seems to be more effective among targeted groups of non-violent offenders, such as drunk drivers. In the light of such findings, there is merit in insisting that home detainees should be non-violent offenders and have spent at least six months in prison. Justice is upheld as they have at least been minimally punished in prison. Thereafter, they should not be mixed too often and too long with hardcore criminals. If it is bad company that led some misguided offenders into prison, why test the penitent's resolve by confining him further with proven bad company? Why suffer him to be corrupted even further while in prison? It is in the public interest to give deserving contrite hearts a second chance. We should grant them the opportunity to redeem themselves so long as they do not pose a risk to the public. It is a fact I wholeheartedly applaud the spirit of the Bill. Nonetheless, I would like to raise several points for the Minister's clarification.”
“Sir, could the Minister clarify whether there are any statistics available as to the loss to the economy in terms of workers taking leave during a flu epidemic?”
“So I think that is something for the future. And if, indeed, the rules are changed, I am sure the suggestions made by Mr Ong and Mr Ravindran will be considered by the Committee. Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. - [Assoc. Prof. Ho Peng Kee]. Bill considered in Committee. [Mr Deputy Speaker in the Chair] Clause 1 -”
“" This is a management decision which the directors in a law corporation must make. Because if none of the directors wants to handle the deal, then the deal will go elsewhere. The other point which Mr Noris Ong makes is on the acronym "LLC". "LLC" was suggested by the Law Reform Committee which included two Senior Counsels and other law firm partners. There was no objection expressed to this acronym which, in our context, stands for "Limited Law Corporation". It is felt that the acronym should not cause any confusion when used in Singapore for domestic clients although in some jurisdictions, LLC may have a different meaning, ie, Limited Liability Company. But in Singapore's context, the fact is that - I have mentioned this in my speech - the invoice and the official correspondence must state that this is a law corporation with limited liability. So domestic clients dealing with the law firm which is incorporated will know who he is dealing with. We do not think it will cause confusion. But in any case, for people who want to avoid doubt, the Bill actually gives an option. You can either put "LLC" or "Law Corporation". So those law corporations which have US clients may want to adopt that option. The other point that has been mentioned is why the provision that all shareholders must be solicitors. Both Mr Noris Ong and Mr Ravindran know that, from the Bill, this is the current position. But the Bill itself provides that, in future, the rules can prescribe for other non-solicitors to be shareholders. As some Members will know, this vehicle called the multi-disciplinary practice is in fact something which many other jurisdictions have considered. I understand that there is a working committee of the Law Society which is also considering that.”
“Indeed, for lenders who lend to these law corporations, even though they are private exempt companies and therefore need not file annual returns, if they are scrupulous, careful lenders, they can ask the firm for its accounts. For example, the Bill provides that law corporations must comply with the Solicitor's Accounts Rules and that includes the filing of the accountant's report with the audited accounts with the Registrar of the Supreme Court. That is a safeguard which lenders of law corporations can take up. The other point which Mr Sin Boon Ann makes, and which I think Mr Noris Ong also supports, is why lawyers in law corporations should not also enjoy limited liability. Mr Noris Ong's case is that his liability should be capped. This is of course a matter of debate. But the position is that if we take this tack, it may lead to a lawyer lowering his guard and hence, lower professional standards. We think that it is probably in the public interest that lawyers continue to be personally liable for matters over which they have personal charge. We think this is the correct approach because lawyers, even though they operate in the context of law corporation, are still professionally charged with the duties that are incumbent on them. Indeed, they are expected to be competent and exercise due diligence in matters over which they have charge. So I would expect in a law corporation, the directors would have to decide who is the best person to handle a particular deal. That is one of the benefits of a law corporation where directors can have different legal expertise. The point is the directors will then not say, "I don't want to handle this because if I take it up and anything goes wrong, I am personally liable.”
“I think that is a good point. The Bill provides that a lawyer who is suspended from practice cannot take part directly or indirectly in the management or practice of a law corporation. However, I think she also has noted that the Bill provides that a suspended lawyer cannot hold any shares in a law corporation unless the Council of the Law Society grants him a grace period to dispose of the shares. Sir, the point, of course, is that if the suspension is a short period, should he be made to divest his shares, only to, after the suspension is over, buy back the shares? Of course, I cannot pre-empt the Council who must make the decision and exercise its discretion. But I should think that if the suspension is really for an extremely short period, a few months, for example, so that it is impractical for the lawyers to divest his shares during the suspension period and then buy them back immediately, it could well be a reasonable exercise of the Council's discretion to grant the grace period which covers the entire suspension period. But we have to wait and see whether the Council takes this approach. I think Mr Ravindran argues that law corporations should have a minimum paid-up capital. This question was, in fact, considered very carefully by the Law Reform Committee. It was decided on balance that there was no need to provide for a minimum paid-up capital, as it was felt that the best protection for clients or corporations is to ensure that they are adequately insured to cover any claims which clients may make against them. Hence, as I said in my speech, the rules will set out what is the minimum coverage that is required.”
“So this is a process which I think, if all works well, will indeed be a boon to the Singapore legal sector. Having said this, small firms will continue to have a role. I think much has been said about this too. Indeed, out of the 800 law firms in Singapore, about half, 430 are actually sole proprietorships. So despite the fact that the practice of law has become harder - quicker deadlines, greater client expectations - there is still a large number of small firms out there - sole proprietorships, small partnerships - who cater to Singaporeans who need services in contract matters and advice on family law and criminal laws. The point is that Singaporeans need not fear that arising from this opening up, costs will rise so astronomically that they cannot even have access to legal services. This approach really, together with the other amendments on corporatisation, increases the choice for Singapore consumers. We are talking about the mode of delivering legal services. So besides the sole proprietorship, you have got your small partnerships. And indeed even for small partnerships, some of them have created niche practices. Others are larger partnerships. And now there will be law firms in the form of corporations. Then you have got informal law alliances which are existing and soon formal law alliances, and joint ventures. So there is a whole range. Even as there is a whole range of consumers, now there is a whole range of suppliers, and the matching can be done by the market. I hope I have answered most of the major concerns which Members have raised. There are also some good suggestions made by Members. For example, Mrs Lim Hwee Hua asked whether lawyers and law corporations should be required to divest their shares when suspended for a short period.”
“So a lot depends on the local lawyers. Are they up to it? Do they see the need for the move? Are they positive, and indeed I think many are positive. Two to three years ago when the fact was announced that the Government was looking into this, local lawyers were more resistant. But over time, partly because of the economic crisis and partly because of what is happening elsewhere, I think they realise - and also partly because of the work being done in the region by local law firms - that there is a market out there. There is now greater confidence on the part of local players to tie up with foreign partners. So will local law firms be affected? I think a lot will depend on how they respond to the challenge. If the scheme works out, as it should, where the AG takes in established reputable firms who will give us their business plans, whom the AG assesses will work for Singapore, and these established foreign firms do not take us for a ride, as they probably will not, and they come in and do the type of work which currently only a small percentage of top-notch lawyers are exposed to, ie, Tier 1 work, which will then be available to a larger number of Singapore lawyers, a good start is made. Mr Sin Boon Ann wondered whether this will benefit Singapore lawyers. I think he himself has answered it. For a start, it may not be a quick uplift. But, I think, as Singapore lawyers get exposed to Tier 1 work, complex work, they will also be clued in. It may not be Singapore law, but then they will be exposed to the documentation, the processes. And over time as these joint ventures become larger and venture into the region - as I have said in my Second Reading speech - they may, in fact, push for Singapore law to be the governing law of these regional contracts.”
“And I think this acts as a very good safeguard because foreign firms which want to enter into joint venture arrangements with Singapore firms are reputable firms which will not risk their reputation. AG has many years of experience doing this already. Because we have had many offshore firms coming to Singapore to set up branches here and they must get permission from the AG. So he is not a new boy in the block. He has been doing this for a long time. I believe that the AG has the necessary wherewithal to handle this task. Then the question arises as to why when foreign lawyers come in they are treated differently from local lawyers in terms of the disciplinary process. The feedback that we have is that foreign lawyers, in fact, prefer a system that is confidential. They would prefer not to be involved in the disciplinary processes of the Law Society, ie, they would rather that the current regime continues. In other words, the AG will still be the primary person who will regulate them and discipline them. But he will not be doing it in a vacuum because the Act says that the rules can prescribe Codes of Conduct and Ethics by which foreign lawyers will be judged, will be pegged against, so that when the AG disciplines them, he will not be doing it in a vacuum. He will be doing it in that context. Indeed, the Act provides that before he disciplines a lawyer, the lawyer would have the opportunity to submit a written explanation, and then AG will act if he has sufficient reasons to do so. Mr Jeyaretnam makes that point. But he should not worry for these foreign players who come in. Another point is whether or not the entry of foreign lawyers will lead to hardship for local lawyers. I think there will be some adjustments. There will be more competition.”
“So the scheme is such that it is flexible enough for law firms to make their own judgements, do their own sums, and then come to a decision how they want to do it. It gives them some flexibility. But there is this point about how to ensure that law firms which come in will indeed add value. Here, again, AG is the person primarily tasked with this important job. Like I have said, he will consult other relevant agencies, including the Monetary Authority of Singapore. He will, of course, look at the track record of firms which apply, and also the track record and expertise of foreign lawyers in these firms. Foreign lawyers in these firms - I think Mr Ravindran made this point - should not come in and take control. It is important that they do not come in in the guise of a joint venture when, in fact, they are practising in Singapore wholly on their own. This point has been taken into consideration. Because the rules that will be made will say that in a joint law venture, the number of offshore partners should not exceed the number of local partners, so that the management will not fall into the hands of the foreign partners. What is also important is that each applicant for a joint venture licence or registration must submit a business plan. In other words, the ball is really in their court. They have to persuade and convince the AG that they can add value. And this strategy is also a good one because they will then be monitored against their business plan over time. The business plan will therefore act as a benchmark - whether they are delivering on their promises. If they do not, then the next time their registration comes up for renewal, the joint venture will not be renewed.”