Sin Boon Ann
Singapore
“Madam, with growing affluence, rising obesity has also become a national problem. Other than the health risk for the individuals, there are other related problems such as healthcare expenses, loss in productivity and so on.”
“Madam, mental health problems still hold some stigma in the society and will prevent patients from seeking help and professional advice early and impede their re-integration into the workforce and community after treatment.”
“Sir, the silver tsunami is almost upon us and we must be prepared for the transformation of our social landscape. One in every five residents will be above the age of 65 by 2030. Many Singaporeans can expect to live another 20 years more but the quality of life can vary greatly.”
“If they are eligible for HDB concessionary loans, they will not be affected. However, quite a number of HDB upgraders or downgraders do not qualify for such loans. They may be upgrading due to additional children in the family or taking in elderly parents.”
“Sir, rigorous and thorough training for our servicemen is necessary to prepare them adequately for their role as defenders of our country. However, training safety is just as important.”
“But I feel more needs to be done to consolidate the understanding even further. What are MINDEF's action plans with this aspiration in mind? What are the upcoming educational publicity and other programmes MINDEF has planned to enhance the awareness and understanding of our public.”
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“Sir, I share the sentiments expressed by my colleague that many Singaporeans thought that our Government's contribution of US$50,000 to the recent disaster in India could have been better. However, I note that our Government has also been helpful in providing assistance in other forms as well to other countries, and these programmes are not often publicised. It is unfortunate that the issue of our contribution to the disaster relief effort in India is now firmly etched in the minds of the people. I would like to take this opportunity to ask the Minister, therefore, to clarify whether our Government considers our aid contribution to be reasonable and whether this is in keeping with what the other countries are contributing and, secondly, to give us an explanation as to our policy of providing foreign aid to the other countries.”
“Sir, we were voted into the membership of the UN Security Council in October 1999. Election to the membership of the Council is indeed an honour for us and at the same time, it is a milestone that indicates that we have matured as a member of the international community. As Council member, we have additional responsibilities to shoulder. I have no doubt that we will shoulder and discharge our responsibilities with distinction. It has been more than a year since we assumed membership of the Council. No doubt, many events have taken place since. I note that in recent times, the UN Security Council has been forced to play an increasingly active role in managing the trouble spots in the world. In particular, I note that there has been an increasing number of peace-keeping missions and mediation of violent disputes by the UN. I would like to ask the Minister to give us, first, an update as to the lessons we have learned as a member of the UN Security Council, and secondly, the kind of role we are expected to play in the international community following our tenure as a member of the Council.”
“It is, therefore, in Japan's interest that Southeast Asia remains stable in the long run. Singapore and Japan can be effective partners in promoting peace and stability in the region. The on-going discussions between Japan and Singapore in respect of a Free Trade Agreement (FTA) is something that many watchers are interested in. At the core of the FTA is the underlying belief that free trade between the two countries would serve their respective economic interest. This can be a model for the other countries in ASEAN as well, contrary to what others may think that the FTA with Japan is a back-door entry to AFTA. Indeed, the Singapore-Japan FTA, if adopted by the other countries in the region, may serve to provide a new platform for economic growth and, in the long run, form the basis of stability in the region. I would, therefore, like to ask the Minister to give us an update on the on-going discussions with Japan on the FTA and whether or not there are obstacles, if any, that will affect negotiations, and if the FTA can be signed by the end of the year. 3.45 pm”
“Sir, despite an unfortunate blemish in our records that took place nearly 60 years ago, Singapore-Japan ties have always been characterised by warm and friendly exchanges, both at the level of the political leadership and on a people-to-people basis. The good relationship between the two countries is perhaps helped by the common elements that exist between them. To begin with, both countries lack natural resources and are, therefore, almost totally dependent on trade with the outside world to meet its requirements. In this regard, freedom of navigation through the Malacca Straits is of vital strategic importance, not only for us, but for Japan as well. The two countries are also caught up by the potentially explosive nature of politics in their respective regions. In the case of Northeast Asia, Japan is concerned with the way the two Koreas settle their long-standing differences and is hoping that war would not be the solution of choice for the unification of the two countries. On the other hand, in Singapore, small as it may be for us, we are an oasis in the region, troubled by the internal strife and differences. More importantly, Singapore could potentially be caught up with the struggle for control in the Spratly Islands. In Southeast Asia, Japan has important reasons for staying engaged. First, Japanese investment in Southeast Asia has been rather substantial. In Singapore, the Japanese investment alone for year 1999 was $1.179 billion, as opposed to $708.2 million in 1990. Secondly, the Malacca Straits is of strategic importance to Japan, as it provides a means by which trade between the East and West is facilitated. I believe, Sir, that the bulk of Japanese oil imports passes through the Straits of Malacca.”
“These incentives were given because we thought that such incentives would be beneficial to Singapore in the long run. Sir, what we are asking for here is to level the playing field, shared between the older and the younger workers. This, as I have argued earlier, is necessary to maintain the long-term cohesiveness of our society here. For this reason, therefore, I would urge the Minister to consider such a scheme of giving tax benefits to companies to make it easier for them to hire older employees.”
“Sir, at the commencement of this Budget debate, I touched on the issue of retraining and employability. If you recall, Sir, I had mentioned that for many of these older workers, the issue is not whether they go for training and retraining, but one of re-employability post training, particularly for the older workers. I suggested that the Government should perhaps consider giving some tax incentives to the employers to help make it easier for these employees to be rehired. In his reply, the Minister said, and I summarise it in my own words, that we should not interfere with the operations of the market with such incentives, which would distort its efficiency. In other words, what it means is that the Government will not, at this stage, be considering proposals for tax incentives to encourage employers to hire older workers. Sir, I was hoping to hear that the Government will be considering any tax incentive at this stage. As you know, Sir, a middle-aged employee, who was made redundant and went for retraining, may not be in a position to compete effectively with the younger ones who are similarly qualified. The older employee will probably require higher salary because of his commitment to his family, but may not be in a position to dictate his requirements because of competition from the younger employee who, typically, would not have as onerous a responsibility for family as the older employee has. Sir, we use tax incentives all the time to induce certain forms of behaviour from the taxpayer or even to address certain market conditions. For instance, we give tax incentives to foreign companies to induce them to set up operations in Singapore, to encourage spending in R&D, and to raise funds in the capital market here.”
“However, I submit, Sir, POSBank is not such an institution. It has a social responsibility, in particular, a responsibility to the man-in-the-street. That responsibility would mean that there must be a certain amount of cross-subsidy to see to the continuance of certain essential, albeit not so profitable, services. If for some reason POSBank should choose to relegate some of that responsibility, then it should be carried out over a longer period of time and not so soon after the merger. I would say that what DBS has done with POSBank, since merger, has been a disappointment for the man-in-the-street. The Government is in a position to intervene, either through its substantial shareholding in DBS or through the MAS, by giving it greater clout to regulate the quality of banking service to the customers. I would, therefore, like to urge the Minister to consider a review of, and re-define, the exact scope of the role of POSBank in discharging its social responsibility, as well as a review of the speed with which POSBank may withdraw its services if, at the end of the day, it should decide to continue to withdraw.”
“The man-in-the-street perceives POSBank, Sir, as a public institution. For many who grew up in the 60s, including myself, POSBank was perhaps the first savings bank that he encountered. All through the school years, and even perhaps, his young working adult years, POSBank was the place where his salary was credited into, and the ubiquitous ATM machines served as a convenient means by which banking transactions were carried out. Surely, the services were not exactly sterling compared to privately-run commercial banks but, surely also, they were not worse off than perhaps they are today. 2.45 pm Sir, I can understand the business imperatives that drive many of the decisions for POSBank today. However, the one question that we must ask ourselves is whether everything must be driven by business imperatives alone. The Minister has assured us that POSBank continues to carry its social responsibility, and that DBS will and, I quote, "Retain all the good features of POSBank in order to add to its attractiveness as a combined bank. Certainly, the ATMs will be maintained, and DBS has assured us that it will continue to provide services for the small depositors and, indeed, for children up to 12 years old and students up to age 21." What are good services for the small depositor? It would be, I believe, for the man-in-the-street, the ability to continue using ATMs with cards issued by other banks, maintain savings accounts without levies, tax-free savings, shorter queues and convenient checking accounts - in short, most of the services that Singaporeans were used to. Sir, I accept that we cannot run a commercial institution on the basis that it provides free services. That would be true, if our starting point was that POSBank is purely a commercial institution without any legacy.”
“Sir, the recent focus on the quality of services of POSBank, both in the press and in this House, once again raised the issue of bank mergers and the provision of post-merger services. If Members will recall, the merger between DBS Bank and POSBank led to the closure of some POSBank branches. This has resulted in long queues forming in the remaining branches with customers having to wait much longer before they were attended to. Quite understandably, there was much unhappiness all round. And I am sure some comparisons must have been made in the minds of POSBank customers of the quality of service of the bank before and after the merger. This unhappy episode of course followed the earlier incident that involved the shut-down of DBS' ATMs because of apparently problems involving integration between POSBank and DBS' computer systems. Sir, this is not to mention the general unhappiness and dissatisfaction that Singaporeans felt over the issue of having to keep the accounts if they did not maintain a minimum sum in the account. This has led many Singaporeans into asking whether or not they are better served by the merger. In moving the POSB Transfer of Undertaking and Dissolution Bill, Minister Richard Hu stated and I quote: "DBS was a natural choice as the most suitable partner for POSBank. Since the Government is the major shareholder of DBS, it can be more confident that the DBS will preserve the spirit of POSBank's social responsibilities." Sir, I am glad that the Minister recognises that there are social responsibilities that POSBank will have to continue to assume even after it transforms itself completely into a private sector entity. And the nub of the issue is the exact scope of social or public responsibility that POSBank is expected to shoulder.”
“The principle is simple. It may be better to spend more now on health screening than to have to spend a whole lot more in treatment later on. I would therefore like to urge the Government to consider extending the scope of our health screening programme to include other forms of illnesses as well.”
“Sir, last year, the Government announced that it would embark on a systematic health screening programme in collaboration with charitable organisations to detect diabetes, hypertension and cholesterol level in people who are aged 55 years and above. I wholly support such a programme as I think it will benefit us greatly in the long term. At a personal level, early detection and treatment can help stave off the complications that may arise from such medical conditions. On the other hand, from a national standpoint, such measures help to reduce the long-term cost of medical care which the Government will have to shoulder. As an illustration, the cost of treating stroke patients can be very substantial as many of these patients require long stay in hospitals and extensive rehabilitation. However, we know that the risk of getting stroke can be reduced significantly if blood pressure and the level of cholesterol in the body is monitored and controlled regularly. Sir, much as I welcome the Government's initiative in this regard, I do have one request. Perhaps the Government should consider extending health screening exercise beyond just monitoring diabetes, hypertension and cholesterol levels. Presently, there are tests that are available that will enable one to detect other forms of serious illnesses. For instance, there are blood tests that will screen for certain forms of cancer, and we can identify certain residents with a predisposition towards such illnesses, from family records perhaps, and refer them for additional screening. The cost of such screening may be higher than the screening that is presently offered under our national programme. However, I believe early detection and treatment can help the State to spend less on healthcare in the long run.”
“I can, for instance, think of appraisal records, or the reason behind certain administrative decisions. At the very least, if such information is made available to the person, there is an opportunity to have these records corrected, if they were erroneous. Secondly, freedom of information envisages the regular reviews of public documents and information for release to the public, if possible. In undertaking this exercise, besides the issue of transparency and accountability, it will also have the effect of educating our people on the circumstances surrounding certain events and why certain decisions or policies are taken. This will help our posterity in avoiding some of the errors perhaps that were committed earlier. Sir, for the above reasons, I would therefore, urge the Minister to consider looking into the possibility of enacting a Freedom of Information Act.”
“Sir, transparency and accountability are principles by which democratic governments are governed by these days. The change in the culture of governance has, in part, been motivated by a desire, as far as possible, and without compromising on national security, to free up information to the people so as to allow them to make informed choices. Not only that, it also serves as a check against the excesses of government. Increasingly, there is much expectation by the people for the government to free up as much information as possible. Knowledge is, of course, power. It will be difficult to fully justify our position as a knowledge-based economy if there are many plugs to information flows. Besides, there is always this deep-seated suspicion, if government and public affairs are constantly shrouded in secrecy. In many western countries, freedom of information legislation is becoming increasingly a necessary part of the statutory landscape. In the US, for instance, it has a Freedom of Information Act that enables its citizens to gain access to records kept by government departments and agencies. In the UK, the government periodically reviews and declassifies information for release to the public. It goes without saying that the fact that many of these documents will one day be public documents, does have a salutary effect on civil servants and politicians. Sir, broadly, there are two facets to the issue of freedom of information. First, there is a right of the individual to information amassed on him by others. Very often, decisions are made based on information provided by others. For those who are affected by adverse decisions, it would be unfortunate indeed if they are not given a clue as to, or the opportunity to know, the basis on which these decisions are made.”
“I therefore would like to urge the Minister to consider making legal aid more flexible by perhaps giving more discretion to the Director of Legal Aid to consider each case on its own merits, and not just using the means test as a main factor in deciding whether or not one qualifies. For instance, a person can be earning more than $3,000 a month, but may be supporting a large family, leaving him with a limited disposable income for any form of funding for his legal requirements. Secondly, an intermediate assistance scheme where some form of subsidy may be considered. Presently, the Act does provide some form of co-payment. However, this is not commonly known and if the Director can establish certain guidelines and criteria for such form of assistance and have this widely publicised, I think it will allow more members of the public to gain access to legal aid. I would therefore urge the Minister to consider these recommendations.”
“Sir, I would like to declare my interest as an advocate and solicitor, and that I would have an interest in what I am about to say. The issue of the extent to which we extend legal aid to Singaporeans has been discussed several times in this House. I think the primary concern is essentially whether or not the means test under the Legal Aid and Advice Act is something which puts many Singaporeans out of reach of legal assistance from the State. This issue was raised last year and the Minister, in his reply, said that the allowance given is adequate because if you put in the various deductions, Singaporeans earning $1,200 may qualify for legal aid. Sir, we all know that, and as was indicated and said earlier by my colleague, Prof. Chin, Singaporeans are earning higher wages, and certainly it is not uncommon for Singaporeans to earn more than $1,200 a month. At the same time, legal fees have actually gone substantially higher than before. A three-day trial in a subordinate court can easily set a party back by $10,000, and even higher if the party has to bear the other side's legal cost as well. And in our legal system, in the context of criminal prosecution where a party is able to successfully defend against a charge against him, the ability to recover his legal fees is limited indeed. Because of the high cost involved in getting legal representation, many Singaporeans refrain from seeking legal assistance, if they can help it. Or they are just not in a position to do so because of lack of resources. What happens then is that access to justice is limited to those with ability to pay, and is denied to those who cannot afford it. In short, those who are charged for criminal offences may take the convenient route of pleading guilty, just to get on with their lives.”
“However, not everyone welcomes the US presence. The Chinese, I believe, are deeply suspicious of the assistance that the US would provide in the event that the two Chinas do battle to settle their long-standing differences. Having a strong US presence at their doorstep, and being in a position to intervene at short notice, would not give the Chinese government any comfort. Sir, against the limited scenario that I have painted, I have a number of questions to ask. These are: Is the Government ready to deal with the whole spectrum of issues that may arise from the instability in the region? Secondly, is our defence relations with our neighbours affected by these uncertainties? Thirdly, will our continued strong ties with the US affect our neutrality as a country and put us in a difficult position with mainland China?”
“Sir, the past year has seen an increase in unrest in the region. Certainly, in some countries, we have seen a rise in the level of turmoil and uncertainty within the population. Not only have we seen the unusual replacement of a president by popular means, we have also witnessed the senseless ethnic violence in rioting that has led to a needless loss of lives. What is taking place in these countries is, obviously, of concern to us here because of the possibility of the knock-on effects. These effects may be as diverse as providing humanitarian assistance or a weakening of defence ties because of a change of regime at the top. Further afield, I note with great interest that China has decided to increase its defence spending quite dramatically. It seems that the decision to increase its defence spending was motivated by its relations with Taiwan. The Allied bombing of Kosovo last year, it seems, precipitated such a decision to increase its defence spending. In that campaign, the US was able to pound the Yugoslav government into submission, without having to pour in massive troops on the ground. It dawned upon the Chinese then that they were behind the West in leveraging on technology to fight a modern war. Since the US is willing to sell advanced weapons to Taiwan, the Chinese were quite rightly concerned with the strategic implications of such military assistance. Hence the build-up of arms. Sir, any build-up of arms is always a challenge to peace and stability, particularly when it is set in a region where the parties have made it clear, in no uncertain terms, that they would resort to arms conflict, if necessary, to resolve their differences. In Singapore, it is our stated policy that we welcome the US to maintain a balance of power in the region.”
“Sir, I do not deny that, with hedging, we can get it wrong. But I suppose the issue really is one of price stability. What the consumers do not want are high tariffs all the time, but whether or not they can expect a certain stability in electricity tariffs, instead of having it subjected to changes every now and then.”
“Sir, I shall be brief, taking into account the time that we have left. Sir, I know that we had discussed in this House at a sitting in January this year the issue of electricity charges. At that time my colleague, Mr Leong Horn Kee, in response to the reply from the Minister, raised a supplementary question which touched on the issue of price volatility and how we could overcome it. I believe the issue of fluctuation in prices of electricity charges has been a cause of concern to consumers. In his reply, the Minister agreed that we do not want day-to-day fluctuation in prices of electricity charges as this may cause disturbance in the market. The Minister had also agreed that, in theory, Singapore Power can go into the futures market to hedge against price fluctuation. Sir, I think this is an idea worth pursuing as the futures market is a mechanism aims precisely at preventing extremities in price fluctuation. In a futures market, forward contracts can be fixed at a certain price and the contract will be honoured irrespective of the changes in the oil prices. Consumers, on the other hand, must be educated in understanding that they cannot expect Singapore Power to supply power at low tariffs all the time. What they can expect, however, is the stability of electricity prices. Of course, the prices of oil may come down after it has been hedged, such is the way of the market, if consumers want stability in electricity charges. I would therefore urge the Minister to kindly consider looking seriously at oil price hedging as a means of stabilising the price of electricity.”
“However, as they say, the journey of a thousand miles always begins with the first step. I hope the Government will take that first step.”
“On the other hand, a highly skilled IT professional, who is Singaporean, will be in demand by the MNC who is prepared to pay top dollars for his services. The result, unfortunately, has been a widening of the income gap between the two. Yet simple economics tells us that we cannot artificially prop up wages for those from the working class in order to narrow the gap, unless we want to price ourselves out of competition. Against the backdrop of rising prices and the cost of living, the growing income disparity will, no doubt, add to the growth of discontentment within our society. We will, no doubt, begin to see the age-old conflict between the haves and the have-nots rearing its ugly head again. The statement by the Government, that our workers must go for training and retraining in order to increase their productivity and wages, has almost become a motherhood statement in Singapore. The deeper issue is: how can we ensure that, with training, our workers can be assured of better paying jobs and a more secure future? Can the inherent discrimination against older retrenched, but trained, workers seeking re-employment be overcome? Has the Government looked into and dealt with this issue? Sir, if we accept the foregoing arguments, then it follows that our financial policy should also be skewed to address these problems raised. For instance, would the Government consider the possibility of giving some form of tax rebates to companies which employ older workers or retrenched workers? Additionally, should special tax concessions be considered to attract highly qualified Singaporeans to return to Singapore to contribute to the growth of our country? In making this submission, Sir, I know that the answers may not always be there readily for us.”
“For the young bright Singaporean looking at the future ahead of him and where the world is his oyster, he will soon wise up and ask himself, "What is in it for me?" He will obviously be doing his sums and decide what is in his best economic interest. Can we count on him to put the national consideration before himself? I would like to, Sir, but I doubt it. By defining success purely in material terms, we have inadvertently raised one generation of young Singaporeans who are dedicated to the god of conspicuous consumption. Driven by a deep-seated materialism, many of our best and most capable will continue to leave our shores to seek their fortunes elsewhere. This will have the effect of depleting our talent pool even further. Sir, it is, therefore, not just a problem of workers continually learning new skills and working in a new environment that we have to grapple with. It is, I submit, a deeper set of problems derived from globalisation, how this will affect our workers, their families, the likely impact that this will have on the future of Singaporeans and on the limited talent pool that we have. Finally, there is also the issue of the political cost that we are faced with. Sir, there is evidence that the income gap between the top income earners and those at the bottom has widened in Singapore. That this is so is not a surprise. Globalisation has brought about greater competition for people and talent across boundaries. Where talent is in short supply, market forces have dictated that premium salaries would go to them. On the one hand, the same cannot be said of unskilled labour. An unskilled worker in Singapore, working in a low-technology assembly operation here, will find it difficult to compete with his counterpart in China or in India.”
“Indeed, as our forebears had done in the past, they had migrated from China and India, so, too, unless their roots are deeply planted in Singapore, our younger Singaporeans may likewise follow suit, except, this time, they will be moving out of Singapore. So we hire people from outside of Singapore, in part to fill in the shoes of Singaporeans who should be taking up this employment. The net result in substitution is that we do not have a steady base of locally qualified employees who are committed to this country. In other words, we end up with foreigners providing the talents for some of the key services in our economy and not just the manual labour. Sir, this is fine as long as we are able to sustain economic growth and provide the base of political stability. However, if future conditions prove unstable, we cannot count on these people to remain behind for us. If this comes to pass, Sir, I think we will have a problem. In a way, Sir, we are partly to blame for this state of affairs. For want of a better description, the basis on which we govern our relationship tends to be contractual, even if the basis of the relationship is understandable. We contract with students to send them overseas for a good education in exchange for the promise of service when they graduate. If they do not perform their side of the bargain, we claim damages and we shame them publicly. We hire good people for the upper end of the public service. We try them for a few years and, if they do not succeed or they are not suitable, I believe we will tell them to look for their careers elsewhere. So relationship with our people is often kept strictly to contract and are, therefore, economic in nature. Sir, as with any economic relationship, one tends to be calculating.”
“This may, in turn, affect their development in every sense of the word, and affect the future of Singapore. Sir, when we speak of unemployment, it is not just the employee who is affected, but a whole chain of people down the line as well. So, when we speak of helping these employers to make adjustments to the new economy, we must be mindful of the urgency that is required to act on this matter since there are other lives involved as well. That is one possible cost. At another level, we have the economic cost. Labour tends always to gravitate towards sources of high wages and opportunities for social advancement. As we become more globalised, we realise that the labour of our people cannot be contained in our territorial boundaries alone. As opportunities exist elsewhere, our people would be under a strong temptation to seek out these opportunities there. In this free society, there is little we can do to stop them. What this means is that while our people get displaced at the bottom because of the inability to compete with others elsewhere, there are others at the top who are prepared to seek their fortunes outside of Singapore. Their skill sets and talents are such that they would not have a problem getting employment in the financial centres of New York or London, or in the information technology houses in the Silicon Valley or teaching positions in Ivy Leagues universities in the US. There is, therefore, this potential for hollowing out of precious limited talents that we have in Singapore, which we will have to replace, either from the younger members of our population or from other parts of the world.”
“On the labour front, the importation of skilled construction labour, at a fraction of what it would have cost to hire the equivalent of local workers, has but all displaced our own people with similar skill sets. Soon, there will be very few Singaporeans left who are capable of doing masonry work, or carpenters who can undertake form construction. The intense market competition, brought on by our relentless pursuit of economic efficiency, has left a mark on our population. It is not by accident that we have acquired the dubious honour of being one of the most kiasu societies. We became a kiasu society only because our competitive spirit permeates to all levels of society, practically from cradle to grave. Sir, I do not deny the benefits of an open economy driven by competition. The benefits of that ideology are, with the collapse of communism, without doubt. However, what is the cost to society? What is the cost to Singaporeans? At one level, there is the social cost. By allowing a free flow of talent, we tend to displace Singaporeans from the employment that they would otherwise have enjoyed, but for the redundancy made possible by cheaper labour alternatives. In the scheme of things, those who are middle-aged and with limited education, are most at risk to having their employment services terminated prematurely. Such premature termination of employment would invariably cause some dislocation to their family, especially when a displaced employee has a wife and children to support. Unfortunately, it would be the children who suffer. What this would mean is that there would invariably be cutbacks on tuition, music and other enrichment classes and holidays, perhaps overseas.”
“We are faced with the basic question that the budget provides the opportune time for us to ask: how can we ensure that the future of Singapore would always have a place for every Singaporean, young and old, rich and poor? Sir, we know that, at its most basic level, globalisation means, to many of us, liberalisation of trade and greater competition for businesses and resources. Our response is equally clear. We must ride with the tide or be washed away by the currents of change. This is evident in the way we sought to liberalise our economy to facilitate the free movement of labour and capital. Our economy is relatively open to investments. Sir, there are very few impediments to foreigners investing in Singapore, other than those relating to business viability. We have openly encouraged talented foreigners to take up employment and residence here in Singapore, and in the hope that their skills and talents will help add to the talent pool here. In a way, globalisation is very much driven by the economics of pragmatism. Our policies largely ebb and flow, according to the tide of dollars and cents. In other words, we allow cost effectiveness to dictate and decide our policies. It must be. Competition in the global economy requires us to ensure high profitability through constant shifts in business operations, on the basis of costs and profitability margins. Where foreign labour is cheaper to hire than local ones, we hire foreign labour. Where the industries no longer yield the necessary value-add to ensure high economic growth, we abandon them. Just look around us today. Textile factories are almost non-existent in Singapore, and I do not suppose there are many electrical appliance assembly operations remaining. Similarly, there are not many canning factories left here.”
“Mr Speaker, Sir, thank you for allowing me the opportunity to participate in this debate, and I rise in support of the Budget for financial year 2001 and the financial policy that underpins it. Sir, the Minister has pointed out that the Budget debate is a time when we take stock of the economy and the direction that we have taken. The debate is also a time for us to take new bearings for Singapore. What kind of society do we want to create for Singapore and what are the values that we want to promote? As we move into the new millennium, we are cognizant that Singapore is caught up in a transition as the economy adapts to the changes of the global economy where, as the Minister has put it, the main drivers of growth are knowledge and talent. Changes are not always welcome. This is often the case with those who are not able to cope. For the middle-aged workers who are caught in the middle, economic restructuring and realignment would mean potential job displacement and an uncertain future. For the small and medium enterprises, their inability to cope with competition brought on by an increase in the number and presence of the bigger players in the industry, means declining business and a bleak outlook. Sir, we need look no further than to consider the present plight of some of the shops in the HDB neighbourhoods. We have been assured by the Minister that, in the new millennium, there is a place for everyone. Invariably, the question to some, if not many, has been: what does it mean for them? Can we assure them that in the midst of this uncertainty brought on by the global economic changes, the dawn of the future would bring about better times for them, while those who have run on ahead would continue to blaze the trail for those who are struggling to follow?”
“For example, the CPF was only partly restored. We were mindful of the cost impact on businesses if the CPF was restored in full too quickly. Despite the improved business outlook at the end of 1999, the rental rebates for HDB and JTC industrial premises were extended by another year, to the end of last year. Last year, the manufacturing sector recorded healthy growth but the recovery was uneven. Hence, JTC and HDB decided to lift their rebates gradually. Only half the rebate was removed on 1st January 2001. MTI is monitoring the economic situation closely. JTC and HDB will review their rental rates in the middle of this year. We should avoid distorting the general market prices for Government goods and services by directly subsidising them. To help small companies and the lower-income groups, the Government will continue to give rebates and provide special economic assistance schemes to these groups directly.”
“Sir, I would like to ask the Minister whether there are measures taken to ensure that there is no repeat of the phenomenon of regulatory capture by utility providing companies which has been witnessed in countries elsewhere. BG George Yong-Boon Yeo: Sir, our structure will not allow for easy regulatory capture, because it breaks the industry up into contestable and non-contestable elements. In addition, there will be a separate system operator and, over and above that, a separate regulatory structure. The power stations will compete in generation. At the retail end, there will be competition. The grid, being a natural monopoly, will be tightly regulated. Over and above that, the system operational despatch will be done separately. And then we have regulators on top to make sure that all is well. Of course, there will be problems, but then that is what we are here for, to solve problems. CHARGES FOR AMENITIES/FACILITIES (Review) 13. Mr Noris Ong Chin Guan asked the Minister for Trade and Industry, in view of the uncertainty of the economic situation ahead, whether he will consider it necessary to review the charges for amenities/facilities (for example utility rates, rental charges, petrol prices) so that these charges will not be too burdensome particularly on small and medium enterprises and on Singaporeans from the lower income group. BG George Yong-Boon Yeo: Mr Speaker, Sir, though our economy did very well last year, the performance was uneven. Some SMEs, particularly those in the domestic sectors, did not do as well as those companies which benefited from the strong external demand last year. We understand the plight of these smaller companies trying to keep their businesses viable. Wherever possible, we have kept business costs down.”
“Sir, I would like to ask the Minister of State whether the Government will move to act against the Falungong society if they are perceived to have a political agenda, other than just an exercise group. Assoc. Prof. Ho Peng Kee: Sir, of course, this is a hypothetical question. The point right now is that the society is a registered society and there is no reason to act against the society. Indeed, the society issued a statement saying that it did not have prior knowledge of the event and that it would not condone any of its members breaching the law.”
“Just a point of clarification. Going back to the earlier point made by the Parliamentary Secretary, my question is: how is the TCM institute able to draw capable people if the Government does not take the first step of recognising the qualifications by the institute?”
“Perhaps, the Minister could clarify the ambiguity here. Clause 13 amends section 76(B) of the Act by widening the scope of share buy-back to include, inter alia, preference shares as well. In our earlier debate when the Act was amended to accommodate share buy-back, I understand that the 10% threshold was a ceiling arbitrarily set because of the relative uncertainty as to how share buy-backs are likely to be implemented in Singapore. Looking at the overall scheme of things, one wonders why there needs to be any ceiling on share buy-backs at all. Ultimately, what matters most is that the company must be solvent at the time when the share buy-backs exercise is carried out. If the company wishes to run its capital down by a margin of more than 10%, I cannot see why we should put any restrictions on the company to undertake such an exercise if the company is solvent. I would therefore like to urge the Minister to consider, for future exercises, whether or not to lift the 10% restriction in respect of share buy-backs.”
“That person typically would refer to the professional such as the accountants, the valuers and the solicitors. Subsection 3(e) also provides that the person named in the prospectus shall be liable in respect of the inclusion of that statement in the document. Sir, subsection (e) when read with subsection (1) is not clear. While it is understandable that a valuer who puts his report in the prospectus would be liable for the valuation and nothing else, one would like to know the scope of liability for, say, the solicitor in the prospectus whose name has been included in the prospectus with his consent but whose involvement in the drafting of the prospectus would make it difficult for him to be attributable to any particular statement. Indeed, one would have great difficulty locating any specific statement as being attributable specifically to the solicitor or the auditor since they typically provide broad and general advice on the drafting of the prospectus. Indeed, in some cases, it is the solicitors who are responsible for the drafting of the prospectus. Does it mean therefore, Sir, that the solicitor or the auditor is responsible for the entire content in the prospectus or the profile statement since subsection (1) says the person shall be liable even if such person was not involved in the making of the false or misleading statement or the omission? If it were so, the burden would be very heavy on the professional advisors indeed. The flipside, on the other hand, is that professional advisors would take extreme caution in the preparation of the prospectus and the profile statement. This would invariably add to the cost of documentation. I am not sure whether such an outcome would necessarily serve the interest of Singapore.”
“While the proposed amendment seeks to set out a comprehensive list of documents that would be exempted from the advertising restriction, it nonetheless raises queries in respect of other documents that are not referred to therein and that may therefore potentially qualify as an advertisement for the purposes of the Act. For instance, section 210 schemes may inadvertently be caught by this definition because there are potentially schemes that, when implemented, would draw the public's attention to an offer of shares or intended offer of shares. Additionally, there could also be certain directors' reports which, on some occasions, may be publicly published that are not covered under the exceptions. Rather than clearing any confusion, specific exemptions on some advertisements give rise to the greater concern of whether other documents not referred to in the subsection are necessarily advertisements simply because they are not specifically mentioned in the subsection. After all, Sir, express inclusion is implied exclusion. Clause 11 of the Bill revises section 55 of the Act, Sir. Section 55, Sir, as you are aware, sets out the civil liability for false and misleading statements and omissions. Under subsection (1), the Act provides that persons referred to in subsection (3) shall be liable to compensate any person who suffers loss or damage as a result of false or misleading statements in or omissions from the prospectus or the profile statement, even if such persons are not involved in the making of false or misleading statement or the omission. Subsection (3) sets out a list of such persons and, in particular, includes a person named in the prospectus with his consent as having made the statement.”
“Under subsection (4) of section 48, it is a further requirement that an advertisement of an offer or an intention to offer shares must contain certain additional information. These would include, for instance, a statement that identifies the offeror and the shares or debentures or units of shares or debentures. Unfortunately, Sir, what the section does not indicate is how the information required by the section is to be passed on to members of the public. Very often, Sir, either in the print media or on television, the obligatory reference to these statements is carried out either in fine print or in quick flashes across the screen, such that it made a mockery of the mandatory requirement that the information be set out clearly in the advertisement. This is clearly an instance where the people concerned would just notionally comply with the requirements of the Act but are not necessarily in keeping with its spirit by ensuring that the information required under subsection (4) is clearly passed on to the readers or the audience. Subsection (8) of section 48 provides that an advertisement or publication does not contravene the prohibition in the section, amongst other things, if the document is a notice or report by the corporation or one of its offices about its affairs to the Exchange or is a report by the corporation or one of its offices of a general meeting. There are several other exceptions in the section. It would appear that this section presupposes documents calling attention to an offer to be advertisements. Against this white canvass, rather detailed exceptions are set out. Sir, in law, we have the principle that express inclusion is implied exclusion.”
“I note that under subsection (2), the information required should relate to what is reasonable for the investors and their professional advisers to find in the prospectus and such information extends only to what is known and in the circumstances ought reasonably to have been obtained by making enquiries. Nonetheless, the burden still remains and the element of uncertainty will always be there. I would therefore urge the Minister to consider moderating the language of section 45 in order to reduce the extent of the burden placed on people providing such information. Subsections 3(b) and (d) of section 45 appear to be repetitive at first brush. On closer examination, it appears that information is to be provided on the corporation whose shares are the subject matter of the offer whether or not it is the corporation that is offering the shares or the person having a controlling interest in the corporation who is offering the shares. If that were the case, subsections (b) and (d) should have been drafted as one subsection. Additionally, in the way it is drafted, subsection (d) gives rise to uncertainties as there is no definition of what the word "control" means and the words "underlie the offer or invitation" could have simply been substituted with "the corporation whose shares are being offered". Clause 8 amends section 38 of the Act by replacing it with a new provision. On a plain reading of the new section 48(1) and (2), it seems that subsection (1) is repetitive and could have been done away with altogether. Sir, both subsections deal with the prohibition against advertisements unless the provisions of the Act are complied with. I fail to see, Sir, why subsection (1) should be there in the first place. Perhaps the Minister could explain.”
“In Singapore, for the reason that we have applied the principle of caveat emptor in most areas of investments, we should perhaps in a consistent manner adopt the example of the Australians and similarly dispense with prospectus requirements for small scale offerings. Having set out my comments on the broader picture, I now turn my attention to some of the drafting details in the Act. Clause 5 of the Bill sets out the new section 45 of the Act. Section 45 prescribes the contents which prospectuses must have. These would include, inter alia, all information that investors and professional advisers should reasonably require to make an informed assessment. Incidentally, such prospectuses should contain information only to the extent to which it is reasonable for investors and their professional advisers to expect to find in a prospectus. Sir, to require prospectuses to contain all information that investors and their professional advisers would reasonably require is to place unnecessary and overtly onerous burden on the people concerned. While every effort would be made by the directors and professional advisers to provide all information, whether or not all information has been provided is always determined with the benefit of hindsight. Until then, one can never be certain whether or not all information has been provided, and until such information is challenged, the parties concerned would always be unsure as to whether or not they have discharged their duties in this regard.”
“If the principle is one which I have heard before, and that is caveat emptor, then the same approach should also be applied in the case of public offer of securities. We should not just use the concept of a public offer as forming the basis of deciding whether or not the activity ought to be regulated. Rather, we should consider the issue of balance and proportion. Does it make sense to go through the whole routine of prospectus filing for a small fund raising exercise? Are there alternative ways to raise funds that would afford a better level of protection for the investors and yet at the same time not put too many obstacles and demands on the promoter? At the moment, Sir, there are some who are of the view that the onerous requirements of prospectus filing may be dispensed with for small capital raising exercise. In such cases, because the exposure to the public is rather limited in scope, a full compliance with the prospectus requirements of the Act may not be necessary or required. In Australia, for instance, under the Corporations Law, small scale offerings are permitted without the requirement of a prospectus, if a person makes `personal offers' of securities to no more than 20 or fewer persons with no more than $2 million being raised in any rolling 12-month period. The Australians have presumably applied the principle of caveat emptor. One would suppose that the limited nature of the offering in numerical terms would help to moderate the risk of massive fraud in the absence of a registered prospectus.”
“Sir, you will appreciate that to prepare a fully compliant prospectus is both a costly and labour intensive exercise; and this is one reason why many promoters loathe to stray into areas that require prospectus filing and the preparation of which is subject to extensive due diligence exercises, filing and declaration requirements. In fact, in relation to the size of the capital to be raised, the effort of compiling and filing a prospectus may not be worth the while. Sometimes companies, especially the technology start-ups that do require capital are not the ones who are in a position to pay for the high transactional costs that come with the preparation of a prospectus. I suspect that the reality is far from the ideal. Many promoters, I believe, canvass the public widely for funds even if it was ostensibly done in a private manner and without the proper filing. This difficulty is often compounded by the fact that the policy of public protection has never been consistently maintained. For now, this Bill recognises and seeks to protect, in a highly regulated and demanding manner, members of the public in respect of investments in securities. However, Sir, as I have maintained in previous sittings of this House, such a regiment of protection is not similarly applied in other forms of investments. I did mention in previous sittings of this House about investment promotions in Singapore of real estates overseas, of investments in time-share apartments, and of purchases of ostrich eggs, as examples of inconsistency with which the subject matter has been approached by the Government. Sir, we have to decide on a consistent approach on the issue of investor protection.”
“However, what constitutes a "public offer"? Unfortunately, "public" is an open textured word. Except for very specific exemptions, there is not much in the Act by way of guidance as to the constitution of a public offer. A random offer of securities to just one member of the public who is not known to the offeror may constitute an offer to the public. On the other hand, an offer that is made to a sizeable number of family members and friends, even if these people are just acquaintances, are not typically treated as public offers. In the first instance, a prospectus filed with the Registry is necessary whereas it is not in the second instance. For many, it is often a judgment call as to whether or not an offer to investors is really a public offer for which a prospectus is required. Sir, when you think of it, the distinction between a public offer and a private offer is both an artificial and unrealistic one. Why should an offer randomly made to just one member of the public be more deserving of protection than an offer made to a wide group of people who are tenuously linked to the offeror? From my limited experience, companies raising funds often compile information memoranda that are circulated among interested parties. I have seen many of these documents around. Such documents are intended for private circulation and consumption. Often there are express words to the effect that the information memorandum does not constitute a public offer and therefore is not registered as a prospectus for the purposes of the Act. It seems that this is an accepted practice in the industry in order to circumvent, rightly or wrongly, the prospectus requirements of the Act.”
“Mr Speaker, Sir, thank you for the opportunity to speak on the Companies (Amendment) Bill which I rise in support of. Before I proceed, Sir, let me declare my interest in the subject matter. As a practising solicitor, I have, on occasions and from time to time in the course of my professional work, to deal with the provisions of the Companies Act and its amendments. This Bill seeks to improve, among other things, the disclosure requirements in the Act for offers or invitations to the public; the exemptions from disclosure requirements and to widen the scope of the share buy-back provisions in the Act. I believe these amendments are part of the ongoing review and reform which the Government is undertaking with respect to the Act and the other related legislation. Sir, while I am agreeable to the efforts of the Government to improve the provisions of the Act, I do have a number of concerns that are raised by the Bill and ones which I hope to canvass before this House today. To begin with, there is the issue of the public offer. One appreciates that an underlying objective of the Act is to protect members of the public from unscrupulous promoters. Here the Act makes a distinction between a public and a private offer. Where an offer to apply for shares or other relevant securities is made to the public, the Act requires a full disclosure of all material information in the form of a prospectus registered with the Registry of Companies. The same, however, is not required in cases of private offers; presumably because the public at large is not at risk. Singapore, as with most other common law jurisdictions, uses the concept of the "public offer" to determine whether or not an offer of securities ought to be regulated by the authorities.”
“Sir, will the Minister of State consider allowing the grassroots organisations to use the roof-top facilities from time to time for their activities, aside from the recreational facilities which we talked about earlier?”
“In other words, the benchmark is arguably our way of remunerating them for the quality of skills that they have brought about in running this country. At the end of the day, Sir, we have to ask ourselves: are we prepared to pay the price for top leadership? Is it worth it? I would say that at least for us, the system is transparent and it is worth every cent of it. We know how much we are paying our public servants; or do we want a system where political appointment holders are paid little, and the true cost of leadership is not known until perhaps the leaders fall and corruption investigations begin? Sir, to my mind, the answer is obvious.”
“It is the cynicism of some Singaporeans on the ability of our political leaders who never really went through the baptism of fire in the private sector that I want to touch on briefly for now. The argument is simply this. We pay Ministers top private sector salaries. Can they really perform to the level of expectation required of the remuneration that they enjoy if they went to the private sector? In other words, would they have earned as much if they actually took on private sector jobs? Sir, I believe that to take this line of argument is to confuse the issue. Let me explain. I am a solicitor and I earn an income. I should not be expected to earn the same salary as a doctor if I tried to do the work of a doctor. This is because I am not qualified and, more importantly, may not be suited for the job. The two are not the same. I am paid my salary which may be comparable to a doctor's salary because of what I do as a lawyer. Nobody begrudges the fact that I earn as much as a doctor. By the same token, we use the private sector salary as a benchmark. That does not mean that we should expect all political appointment holders to have the same talent to be a top doctor, lawyer or a banker. What the benchmark does in addition is to provide a basis for valuing the ability of those in the public service. Why should they be valued any less simply because they are in the public sector? Clearly, this approach to pay our public office appointment holders well has been proven right, as was mentioned earlier, because the last round of financial crisis has spared this country of the misery that we have seen in the region. Is this not proof of the quality of the leaders that we have?”
“The question that we have to ask ourselves is whether we want to pay the right people at the top to continue to create wealth for Singapore and to close the income gap in the process. If the answer is yes, should we not be willing to pay the price? The Prime Minister has given us a very lucid illustration earlier and I think the example is very telling. Secondly, some Singaporeans, I suspect, may well support the pay increase but would say that it is inappropriate to implement this at this stage with the recent spate of price increases. Sir, with all due respect, I do not think that the two issues are necessarily related. What this argument is tantamount to saying is that because there are price increases, political appointees must not have salary adjustments. Why should the political appointment holders be any different? Are the promoters of this argument saying that wages for all employees should be frozen? Quite clearly, Sir, the argument is non-sequitur. Finally, I have heard the argument making its rounds that the political appointment holder who is paid the equivalent of private sector salary may not be able to hold his own in the private sector once he leaves the comfort zone of the public service. This applies to political appointment holders who have never worked in the private sector before. Again, I find this argument rather difficult to follow. Sir, I believe that we have used the salaries of the private sector as a benchmark to allow us to (1) attract and keep those from the private sector with the necessary ability to serve the country; and, more importantly, (2) to recognise the ability and contribution of political appointment holders who have led the country well.”
“It is therefore quite clear that some sacrifices would be necessary. However, to ask them to make near complete sacrifice or even total sacrifice in the service of the country is a very naive thing to do, Mr Chiam. These people have their mortgages to pay, their children to look after and a certain lifestyle to keep. His calculation of $50,000 is a relative thing. To the very poor in the poorest country in the world, your lifestyle would be obscenely rich. I think it is quite inappropriate to just pluck a figure out of thin air and to say that it is appropriate by your standard and your judgement. Let the person who is deemed by the power that be, who is capable of running this country, decide whether or not it is a sacrifice that is worth making and paying at the point in time. The answer to the call to political office to serve the country is not a call to priesthood. They are not expected to live the life of an ascetic. Even in Israel, where the country has for years had prime ministers who lived rather ascetic lives, has had to face down two major scandals recently, when their President and former Prime Minister came under investigation on allegations of corruption. If a salary adjustment is in order, and having lived with a wage freeze for the last three years, why should we begrudge this adjustment? We are not a basket case where our people live from hand to mouth. We can afford the salary increase and we want to continue to have people at the top who will be able to give all of us, and not just some Singaporeans, a better life in the new economy. We had a discussion earlier about the issue of growing income disparity between the poor and the rich in Singapore.”
“The argument simply put is this: as long as there is inequality of income distribution and as long as CPF contribution has not been fully restored, political appointment holders, least of all, should be allowed to have salary revision. Can this argument be tenable? Against this argument, we have to ask ourselves the kind of society we want to build for Singapore. I do not think for a moment that a country founded on a political philosophy of equal misery for all is going to bring about more wealth for the people in the long term. Let us recognise a basic principle here. We are a market economy where talents and resources are allocated on the basis of pricing. You want the best talent, you must be prepared to pay for the best talent; and by talent, I mean not only people with the ability to run the country well but also the honesty and integrity to run it. To the detractors, I have a question. Would you rather pay the political appointment holders a fraction of the salary and have either people without the ability to take charge of our Government and make a mess of Singapore or have people whose only interest in coming to public office is to cream off the system and line their pockets in the process? Let us be honest about it. Talent is in short supply in Singapore. We want to attract the best talents to serve this country. For them, they will have to come out of the comfort zones of their established careers and family for the country. It is indeed a sacrifice for many who have established themselves in their career. They have to make a judgement call by resigning their jobs and serving the country as political appointment holders. We all know that there is no assurance that they will succeed in the long run as political appointment holders, having made the sacrifice.”
“Many Singaporeans may feel that the Government should continue to set the example, as Mr Chiam had said earlier, by keeping the salary freeze until such time when CPF contribution has been fully restored to the people and the economy shows robust growth again. The Ministerial Statement unfortunately also comes at a time and hot on the heels of the recent spate of announcements of cost increases. These include, for instance, the $2 charge on POSB accounts for those who maintain low deposits, and the recent announcement of revision to water rates, increase in transportation charges, and other private sector led charges. At this moment, we know that the recovery of the Singapore economy is rather selective and not across the board. The construction industry is still in the doldrums and many Singaporeans are still unemployed. At my MPS alone, I get many requests from my constituents for help in looking for jobs. They are the ones who have been retrenched and are not so employable on account of age. Against the backdrop of the present scenario, many Singaporeans may be asking: how can the Government increase the salary of civil servants and political appointment holders? I do not deny, Sir, that the issue of Ministers' salary has always been a very emotive one. For reasons that I shall elaborate later, I support the move by the Government to increase the public sector salary. Let me examine some of the arguments raised against the salary revision. First, as was alluded to by Mr Chiam, the inequity argument, ie, the growing gap in income distribution between the top and bottom income earners and the fact that CPF contribution has not been fully restored. Sir, the argument of social inequity is based on the idea of equal misery for all.”
“Sir, I rise to support the Deputy Prime Minister's statement. Sir, I will not touch on the salary adjustments of the civil servants as I think that is less controversial than the issue of the Ministers' salary which is tied to the public sector salary adjustment. We have had extensive debates before, inside and outside this House, on the issue of the amount that political appointment holders and, in particular, a Minister, should be getting as his salary. Mr Chiam had earlier alluded to the fact that to the average Singaporeans who may not be paid as much, especially to the fair number of Singaporeans who earn less than $24,000 a year, the idea of a Minister getting more than a million dollars is beyond comprehension. At first brush, there seems to be a sense of inequity to this. Somehow, many Singaporeans feel that it is not right that there should be such a divide between the masses and a small number of political elite who, as the people's representatives, should reward themselves so handsomely with such salaries. Sir, against this thinking, there is a sense that the people have made deep sacrifices, as was acknowledged by the Prime Minister earlier, when the Government decided to cut their CPF contribution following the recent financial crisis. Their CPF contribution has not been fully restored to date and there are constant calls for the Government to restore their CPF contribution to the level before the financial crisis. Therefore, for some, it seems odd that while they are making the sacrifices by taking pay cuts, the political appointment holders and civil servants should be increasing their salaries at this time.”
“Sir, it is precisely because of Singapore 21 that we have confidence in our people, in our system, that ultimately, when it comes to the crunch, when there is a viable alternative, if for some reason, the integrity of the present party and the leadership is compromised, there is nothing to stop the citizens of Singapore from supporting the opposition. There is nothing to stop them from coming out in the open with large monetary contributions to support an alternative view that will surely take us on. If we do not perform, if the people go without homes or health services are not looked after, then I certainly do not think that a restriction like this is going to stop people from making contributions to the opposition parties. The Bill seeks to prevent foreigners from interfering with the ability of Singaporeans to determine their own destiny. Unless of course the hon. opposition Members are saying that they should sell themselves to the foreigners, I believe they have no alternative but to support this Bill.”