Tan Soo Khoon
Singapore
“May I just seek your indulgence and the Ministers for me to raise a little clarification? I raised the point about the absence of a medical officer at Changi Naval Base when the incident at sea happened last year.”
“We all look forward to its people obtaining their legitimate right to democracy and freedom, though I must add here that it should not necessarily be the kind we now see in some other Southeast Asian countries where democracy, unfortunately, has been taken to mean fluctuating between people demonstrating on the streets and the threat of m…”
“The West is unable to accept that it will soon be overtaken by the emergence of Asian powerhouses and fears that it will become irrelevant in an increasingly globalised world it refused to wake up to.”
“They are committed to Singapore and they want to do their National Service, but they just want MINDEF to exercise flexibility when they request for deferments. Mr Speaker, recently, MINDEF granted a deferment of three months to one Mr Stanley Aw to allow him to participate in the Singapore finals of the World Cyber Games.”
“Mr Speaker, Sir, this issue of the revenue pooling between the two airlines of Singapore and Malaysia is not a new issue. But can I ask why is it that in this era of competition and trade liberalisation, we are still allowing the two airlines to have this archaic policy of revenue sharing which, in fact, results in higher prices for trave…”
“Mr Speaker, Sir, does the Minister of State believe that it is in the interest oftravellers between the two countries to allow what is essentially a cartel made up of MAS and SIA to exist?”
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“Sir, in 1978, I was one of those who felt that this guarantee by Government was wrong. And I feel that circumstances today do not justify a guarantee by Government of this return. What with all this talk of privatization of Government companies and the policy of Government to lay off its hands from all kinds of businesses, the Government, in fact, has no business to be in the business of guaranteeing the profitability of any company, be it SBS or what have you. If you do so, then there would be a host of other companies to guarantee. Why not guarantee the return on shares of Singapore Airlines, for example? Earlier on, Sir, we have heard the Minister for Communications and Information telling the House that SBS is, in fact, a bus company in the private sector and Government should not be in the business of running buses. So I think Government should not be in the business of ensuring any return to shareholders. SBS, like all companies, should compete efficienty with the other transport companies or with any other form of transportation. And it must do so without the benefit of Government guarantees of any kind.”
“Mr Speaker, Sir, in 1978, the Singapore Bus Services Limited was floated as a public company and its shares listed on the Stock Exchange of Singapore. At that time, the then Minister for Finance, the late Mr Hon Sui Sen, told Parliament that in order that the public as well as employees of SBS could have a stake in this company, and in order to ensure that the ownership of the company does not fall into the hands of a wealthy few, the use of CPF money would be allowed for the purchase of SBS shares. The late Minister also told the House that in order to ensure that the shareholders of SBS do not lose their hard-earned savings, the Government would give a guarantee of a dividend of 7(r)% on all SBS shares. My question to the Minister for Finance is: will Government now review this guarantee and consider withdrawing it? Sir, I have always had the suspicion that in the past, each time SBS requested for a price increase, at the back of their minds there must always be the need to show this return of at least 7(r)%. In other words, how do we know that SBS's desire to raise prices or its reluctance to reduce bus fares, now that petrol prices have gone down, is not on account of this guarantee?”
“And a bad image can be inflicted on Singapore by branding one section of our population as dishonest. This image can easily be transferred to other Singaporeans, such as our shopkeepers. I hope the Minister will ask SIA to stop making such announcements about taxi fares to incoming tourists. The announcements are certainly counter-productive.”
“The artificial intervention of Government by imposing sledgehammer type blows on taxes, on motorists, will have an adverse effect on the economy. It is time that the road tax is slashed immediately. I once returned from a holiday in England by an SIA flights. On approaching Singapore, I was surprised to hear an announcement telling those on board the plane that they need to pay only a certain amount of taxi fare from the airport to certain hotels in town. The question is, are our taxi drivers, numbering about 35,000, dishonest Singaporeans? Are they all cheats? I do not think so. We all know that in every trade, business or profession, there will always be a few black sheep, but the majority are good law-abiding citizens. Therefore, it is not right or fair to brand all taxi drivers as dishonest people and hence the need to warn foreigners visiting Singapore. That is the implication when you tell them not to pay more taxi fare than what has been told. But statistics certainly do not show that our taxi drivers are dishonest. There are about 11,500 taxis plying our roads. They must make at least two million passenger trips a year, and yet the number of complaints received against them for one year in 1984 was only 1,349. This, on two million passenger trips, works out to be a mere 0.06%. That is the number of complaints as compared to the number of passenger trips a year. Out of the 100-odd complaints mentioned against taxi drivers, the ROV took action, such as revocation of licence, suspension or composition fines, against only 232 of them, or 0.6% of the 35,000 taxi licence holders. So there is no justification whatsoever to warn visitors arriving in Singapore to beware of our taxi drivers. Besides, they are all Singaporeans.”
“We know that the Government's avowed policy is never to give subsidies, that is, actually make payments out of pocket. Therefore, the only other alternative is to have a fairly high fare price for the MRT. If this is done, the Government will also have to increase the prices of bus fares and taxi fares. Otherwise people will not commute by the MRT. For this reason, people are saying that public transport will not be cheap once the MRT is in operation. When that happens it will be another example of the increase of cost of living due to direct Government policy. I would call on the Government to reduce the road tax. Ours is reputed to be the highest in the world. I wonder why there is need to continually tax the motorists so heavily. The motorists as a group must certainly be one of the greatest contributors to Government coffers. For the year ending December 1984, the Registry of Vehicles collected about $828 million and it expended only one-tenth of that amount, ie, about $8 million for its expenditure for that year. The Minister for National Development boasted a few days back that the Government was increasing its allocation for road construction this year by 133%. That amount provided was $405 million, about one-half of what the ROV collected for one year in 1984. In times of severe recession, Government must relent in taxing the motorists. The Government could easily and should reduce road tax by at least 10 or 15 cents per cc for all types of cars. There is no danger of an increase in car population. Any increase in car population is a natural phenomenon. When the economy grows, car population grows with it. When times are bad, like the present times, the number of cars registered will also decrease.”
“In the process, Singapore lost millions of dollars of foreign exchange to Malaysia. The Government, of course, too had to back-track that policy. I suppose the Minister will stand up and reply later and say that taxi drivers are now earning more. But, of course, what he says is subject to scrutiny. I have enquired of taxi drivers and they say that not all taxi drivers are earning more. But that really is not the point. If a bad policy had not been implemented in the first place, taxi drivers would not have to suffer unnecessarily from the start. The Minister had made mistakes in the past. Should he not now pause to think whether some of his present policies are also wrong? Consider the ruling of allowing only PARF to be given to cars which are not over 10 years old. I know that many people in the motor car trade have petitioned the Minister to extend this period from 10 to 15 years. I would suggest that the Minister do respond to that call positively at once. This would save the country more foreign exchange by less import of cars and create more demand for local services in the motor trade and repair services. If this area of business is expanded because of the greater number of older cars on our roads, then perhaps more employment will be created and lessen some of the unemployment problems in Singapore. The Member for Fengshan has spoken about the increase of transport costs. I believe there is public apprehension that as soon as the MRT comes into service, public transport will be more expensive. Generally, MRTs all over the world run at a loss. I would imagine that Singapore will be no exception. The Government in order to mitigate the loss can do two things. (1) Either have a fairly high MRT fare, or (2) subsidize its operations.”
“The construction of an MRT line to link Marina South to the rest of Singapore would facilitate the sale of land in that area. I would like the Minister to clarify. Is the Government proposing to spend millions of dollars to build an MRT line at Marina South when it is still not developed in the hope of attracting buyers for the land there? But on the other hand, it would also appear that if the Government does not build an MRT line at Marina South, there is little hope of selling off land there for development. I request that the Minister do take time to explain whether the Government still has hopes of financing the construction of the MRT from the sale of land at Marina South. Or is the Government now resigned to the fact that money from taxpayers will have to pay for the whole MRT project which was estimated at about $5 billion? I trust that the Minister will give us a credible answer this time. We have seen the chop-and-change record of his Ministry. Last year about this time the Minister bravely told this House that the increase of the taxi diesel licence fee by $6,600 would not affect the earnings of taxi drivers. The taxi drivers' take-home pay will be more, as he then said. What was the result? The lightning speed with which the policy was changed within three days of its implementation on the 1st of April last year would certainly go down in the Guinness book as a record for the speed with which a government changes its policy. Then we had the infamous petrol price hike to, I believe, $1.51 cents per litre. When that policy took effect, we knew what happened. Thousands of Singaporeans were forced to make regular trips across the causeway to Johor Baru to fill up the petrol tanks.”
“This programme has been replaced by "Tok Selampit". No doubt this is popular but it is shown at a very inappropriate time. Primary school children attending the afternoon sessions miss this educational programme. I would like to inform the House that this programme caters to the need of most of our young viewers and should be screened at an appropriate time for all viewers. I also note that this new programme, "Tok Selampit", is done outdoors. Thus, the colourful and variety of backdrops have been greatly missed by our young viewers. I would like to know why were these changes made. Mr Speaker, Sir, I accept changes if they are for the better and benefit the public. But the new changes which I have referred to do not obtain the objectives I referred. Sir, I admit that I do not follow SBC's programmes. But most of my constituents who do follow these programmes have voiced their unhappiness and started making startling comparisons. Therefore, it is my hope that the Minister would ask SBC to review the situation. Perhaps the hon. Member for Eunos, who is a new member of the SBC Board, could study and recommend measures to improve the Malay programmes. Mr Chiam See Tong (Potong Pasir): Sir, I note that a sum of $996.86 million, or nearly $1 billion, has been provided in the budget for the construction of the MRT system. Now it is clear to everyone that the MRT system is finally to be paid for by the taxpayers and not, as originally announced, by the sale of parcels of land at Marina South. The inability to sell the land at Marina South is due, I believe, to the depressed property market. Last year, the Second Deputy Prime Minister gave the impression that developers were not keen to buy the parcels of land there because there was no access to Marina South.”
“The SBC coverage of the 1985 SEA Games in Bangkok was less than satisfactory. The nightly reports were not of the day's events but those of the previous day's. Many Singaporeans had to switch to other channels to receive the latest results. Also, even though our national team reached the finals of the soccer event, there was no live telecast. Again, viewers had to switch to other channels. I would like to urge SBC to review the need to give more coverage on popular sports activities that involve national teams' participation in important regional or international games such as the Thomas Cup series, the Malaysia Cup Final or SEA Games events. Next, I would like to speak on the SBC Malay programmes. First, the 7.30 pm time slot for the Malay News is not appropriate as it clashes with the Maghrib, the prayer time for Muslims. I would suggest that the News be changed to 8.00 pm. The second item concerns "Sandiwara" which is always popular as it reflects the day-to-day happenings in our society. It has social and educational value. Unfortunately, the "Sandiwara" programmes which used to be shown on Wednesday nights are now shown in the evenings and it is not regular any more. Working people miss the show and so too do the housewives who are busy preparing for dinner. Who then would see this programme? I would like SBC to consider rescheduling this programme to cater to the interest of all viewers, with particular reference to the programmes which have social and educational value. Another example is the highly popular children's show "Mat Yoyo" which has also been cancelled despite its high viewership. I am told this programme is not only popular in Singapore but also in our neighbouring country and I hear even in Brunei Darussalam.”
“Thirdly, Sir, in terms of publicity value, the effects would have been tremendous if Singapore Airlines or its subsidiary had got the award. I believe that we would have got untold amount of free publicity for Singapore by the mere fact of travellers going round the world with the shopping bags which SIA normally issue. It appears that, for a few dollars more, the Civil Aviation Authority has failed to look after our own national interest in this respect and also that of our own national airlines. I think it is a slap in the face on our national pride, awarding a prized concessionaire and a highly valued one at that, to a foreign company and depriving our- selves of all the benefits that would have accrued to Singapore. That, Sir, is like selling away your soul to the devil for a few extra bucks. Sir, when the next round of tenders are put up, I hope the Ministry will take into consideration all these factors which I have stated. It is not just a question of a few dollars and cents more but also one of dollars and good sense. Encik Abbas Abu Amin (Pasir Panjang)( In Malay): Mr Speaker, Sir, I wish to speak a bit on the Singapore Broadcasting Corporation (SBC). Firstly, I say kudos should be given to SBC for its round-the-clock coverage of the Hotel New World disaster. SBC's regular updating of events reflected its responsibile attitude in fulfilling its fundamental objective, that of serving the general public. We know of the achievements of SBC. However, there is still room for improvement. This is especially so in two major areas. One area is SBC's sports coverage and the other is the scheduling and quality of Malay TV programmes. I admit that the SBC's screening of certain sports programmes sometimes does not accurately coincide with the general public's interest.”
“1% of gross sales on cigarettes and tobacco products, with a minimum guarantee of $37.3 million a year to the CAA. The Singapore Airlines Duty Free Emporium (SADE) offered 27% of gross sales on liquor products, 22% of gross sales on cigarettes and tobacco products, with a minimum guarantee of $30 million in its first year, $31 million in the second year, $32 million in the third year. Sir, the difference in revenue for the CAA between giving the award to the Hong Kong company and to SADE (if it had been given) would have been a few million dollars. Sir, this might be a big sum, but if you compare it to the total turnover, the difference is not really big. I feel that here is a case where some discretion ought to have been exercised by the Civil Aviation Authority because of the following: First, it is normal in most international airports to give the concessionaire for such products to the national airline. Instead, it was given to a foreign company where really there is no transfer of technology of any kind. This is merely retail business, and I would not even make any complaint if it had gone to some local company other than SADE. Secondly, the items are sold duty free. So what it means is that the Government and the country do not get any revenue normally derived from the sales of such products not within the Airport. And the Singapore Airlines company would have earned money from all the foreign exchange and from all the tourists who pass through Changi Airport, and that, as I said earlier, is no small amount. As it now happens, all the money that is earned goes to a foreign company and, quite obviously, it is taken out of the country.”
“Mr Speaker, Sir, since its opening a few years ago, the Changi International Airport has gained an international reputation. Millions of air travellers pass through it annually and it is ranked one of the best airports in the world. Changi Airport is also well known as a top-class shopping and eating centre, providing a wide range of good quality products at very competitive prices for travellers and even for Singaporeans. With a market of about 10 million passengers passing through the Airport annually, having a shop space concessionaire at Changi International Airport has indeed become a prized possession for many of our businessmen. One of the most prized concessionaires at any international airport, and Changi Airport is no exception, is the concessionaire that entitles the person holding it to sell liquor, cigarettes and tobacco. It is a prized possession because these items are sold duty free, and they rank as some of the most purchased items in airports anywhere in the world. Sir, when Changi Airport was first opened, the concessionaire for duty free liquor, cigarettes and tobacco went to the Singapore Airlines Duty Free Emporium, which is a subsidiary of our national airline, Singapore Airlines. Last year, when tenders for a new three-year lease were opened, the two duty free shop concessions at Changi Airport were awarded to a Hong Kong company. Sir, I have nothing against the tender system when the awards go to the highest bidder, in this case probably the one who has offered the most attractive conditions to the Civil Aviation Authority. In this case, the company which subsequently won the tender offered the following to the Civil Aviation Authority: 32% of gross sales on liquor products, 22.”
“I would like to appeal to the Minister that this particular unit or department should step up its efforts to ensure that all buildings in Singapore are properly maintained.”
“Sir, there is not much time left and I think the Minister will be glad to know also that I do not have my usual list of complaints about the HDB this year. Sir, in August 1982 the House amended the Buildings and Common Property (Maintenance and Management) Act. The main thrust of the amendment was to ensure that buildings which had units to be sold to different purchasers and which were intended for strata subdivision at a later date would be properly maintained by the developers from the time the temporary occupation licence (TOL) was issued. The amendment to the Act at that time did not provide for buildings where the TOL had already been issued prior to the amendment. I know that there are many buildings in Singapore where tem- porary occupation licences have been issued for many, many years and where strata titles are to be given at some future date. Such buildings do not fall under the ambit of this Act. So when the amendment was moved in the House in 1982, I asked the Minister at that time what steps could be taken to ensure that these buildings, very old buildings, still under TOL, fall within the ambit of the Act. We are all aware that there are a lot of buildings in Singapore which are very poorly maintained, and we do not like to see these old buildings degenerate into slums. Could the Minister advise what steps can be taken to ensure that these buildings are properly maintained? Sir, in the light of the recent hotel tragedy last weekend, it is timely for us to remind ourselves that maintenance of buildings now takes on a new significance. What is needed now is closer and tighter supervision of maintenance of the buildings. I understand that this job is undertaken by the Buildings Maintenance Unit in the Ministry of National Development.”
“Sir, does the Minister not agree that the compulsory inspection of vehicles contributes to a reduction in breakdowns of vehicles? Some hon. Members: Hear, hear.”
“Sir, the SDF grants are also given to workers. It is also given to train the skills of management. The Member for Kebun Baru is a trade unionist. Before he gets too excited, may I point out to him that that is also using workers' money to pay for management. Mr Lim Boon Heng: Mr Speaker, Sir, perhaps some managements would like the workers to work for free. I think it will be a serious mistake if we take hasty steps to reduce contributions to the SDF further. Last year I agreed to a halving of the contribution. I am not prepared at this moment to accept a reduction to zero.”
“Sir, the SDF has more than enough money in its fund. The interest it earns every year from the fixed deposits is more than enough to cover the training grants. I do not see what the objection is.”
“Mr Speaker, Sir, may I be permitted to make a point of clarification on a part of the speech that I made. When I was outside the Chamber just now I believe that the Member for Kebun Baru took exception to the remarks I made about the Skills Development Fund. Sir, I agree that the figure I quoted was for the financial year ending March 1985. But it still means that after the contribution to the SDF has been halved, the SDF would still collect something like $40 million to $50 million in the current financial year. It would still mean a lot of money compared to the amount of grants given out by the SDF in a year. But what I wanted to point out was that the amount of grants given out by the SDF each year was very small compared to the accumulated funds of the SDF. By all means, continue upgrading the skills of workers through grants from the SDF. But during this time of recession, I feel that it is better for us not to burden the employers further and that a suspension of the 2% contribution would be in order until the recession is over.”
“The banks, of course, see nothing wrong in granting hundreds of millions of dollars to Chop Hoo Thye, Lamipak, Pan-Electric, only to see it go down the drain. But if you try to borrow a few thousand dollars from the banks to start an honest and legitimate business, you run into a lot of problems. I welcome the recommendation of the Economic Committee to ask the Small Industries Finance Scheme to widen the scope of the Scheme to make loans to more of our businessmen, but not only just to make loans but to make conditions for the loans easier. Sir, in conclusion, I would like to say that the Economic Committee Report has been a success because it has been able to derive inputs from the private sector. The whole exercise has been significant in that Government has departed from its tradition of relying only on the Civil Service for the inputs that are so necessary in formulating decisions and policies. Hitherto, Government has long viewed the business community with suspicion, believing that its views would only serve its own interests. But that has changed over the years, and this whole exercise has seen the development of a mechanism that has allowed Government to tap the brains of the private sector and offer an insight into problems that Government might not otherwise have. As conditions change, it is essential that Government continues to keep its pulse on the economy and to hear alternative views. The private sector has responded well this time and I think it will only be too happy to continue to provide inputs to the Government if it is asked to do so. I feel, Sir, that the Economic Committee, at least in its form, should continue as a kind of Economic Advisory Council to the Government.”
“Try starting a business in your HDB flat, and the next thing you know you get a letter from the Area Office telling you to stop it, otherwise you will be evicted. If you apply to have a telex fixed in your flat, again the Telecoms will tell you, "We are sorry, we cannot do that." Sir, quite some years ago in the United States, a young man called Steven Jobs built his first computer in a garage in his home. That little garage and those few computers which he built became Apple computers, as we know it today. Who knows, Sir, that one day this kind of thing might happen to some lucky entrepreneur in Singapore. But at the moment I think some of the rules could be relaxed, make it a bit easier for people who are prepared to take the risk, to have an easier start. Sir, the second factor that is troubling entrepreneurs when they start off is, of course, the question of finance. I wonder how many Members in this House have ever experienced getting money from the banks. I have. I can assure Members that although we have time and again said that we should ask our banks to grant loans easily to our entrepreneurs, I think it is easier said than done. Banks are known to be fair weather friends. When anybody goes to them and say, "Can you lend me a few thousand dollars to start my business?" The first thing they ask you is, "Have you got anything to pledge? We would like to be 100% sure that if you do not return us the cash, at least we will have something to sell off in the end." Most of our entrepreneurs just do not have that kind of property to pledge to the banks. I think if they had property to pledge to the banks, I do not think they will be in the business of starting business in the first place.”
“What I am merely saying is what the Economic Committee has said, let the market decide for itself what is the level at which the Singapore dollar should be valued. Here we have a classic case of the right hand not knowing what the left hand is doing. I suggest that the Government reins in the MAS officials and with the Minister for Finance now in charge of the MAS, and I think he knows and he understands the problems of businessmen well. Having been a businessman himself, I think he can put his foot down and set matters right in so far as the exchange rate is concerned. Sir, I would like now to turn to the chapter on Entrepreneurship and state my views. Sir, in spite of all the talk that has been going around that we would like to encourage our entrepreneurs, I feel that the environment in Singapore is still not conducive enough to nurture a crop of local talents, local entrepreneurs. Sir, there are two factors that confront any budding young entrepreneur. These are: (1) how he can start small; and (2) finance. What does starting small for a budding entrepreneur mean? It means small overheads. He lacks money, he lacks finance. He has to find ways and means to stinge, so to speak. Not everyone can afford a fancy office in one of the highrise buildings with marble floors or with wall-to-wall carpeting. Many of them would like to start business by starting small at home in their own rooms, the living rooms, and if they are a bit lucky and if they have a garage they would like to start business in the garage. But what happens in Singapore? The rules which our various Government bodies and statutory boards have do not permit this sort of thing.”
“But what I hope even more so is that this recommendation is implemented. The reason I say this is that last Friday we all heard that the money market in Singapore was caught by surprise when the Monetary Authority of Singapore intervened again to prop up the Singapore dollar when it fell against the US dollar to S$2.16 and taking it to S$2.13. Sir, this intervention by the MAS conflicts with the policy guidelines and the recommendation made by the Economic Committee. Sir, when the Economic Committee says that market forces should determine the Singapore dollar rate, it merely means that the value of the Singapore dollar should reflect fundamental economic factors. There has been a gradual erosion in the value of the Singapore dollar due to the poor economy. But by the action of the MAS last week, it appears that the MAS felt differently. As a result of this intervention by the MAS, the overnight interest rate shot up by as much as 100%. This is something which we all can ill-afford during the present economic situation. Artificially propping up the Singapore dollar is not going to help the situation. Here we are talking about how costly we have become and the Economic Committee grapples with all kinds of measures to address our economic problems, and yet we have one Government agency taking steps to nullify all our efforts. We have the Government on the verge of accepting the recommendations of the Economic Committee, and there we have officials from the MAS acting with impunity and doing something contrary to the recommendations of the Committee. Sir, I am not advocating a devaluation of the Singapore dollar.”
“Of course, after much reflection, I realized that he is quite an intelligent Minister because he promised to reduce development charges in a year, when he knew that construction was practically at a standstill. So, in fact, his claim to reduce the development charge actually amounted to nothing and was really quite irrelevant to the situation. Sir, the Government therefore should not merely say that the property market can sort itself out of this situation. I think it has an obligation to put matters right. Now, how can it go about this? The URA has accumulated so much money that I think it could do well to help the developers, and to help the property market, by buying back some of the empty buildings on a willing-seller willing-buyer basis. Many developers today are facing cash flow problems. Some of them have practically no cash flow and are on the verge of bankruptcy. The banks are also in a dilemma because they now find themselves with non-performing loans. And if they move in to foreclose, the non-performing loans merely become non-performing assets of the banks. I would seriously suggest that the Government consider asking the URA to salvage the situation by taking back some of the empty space. Sir, I now move to another point raised in the Report, and this concerns the exchange rate of the Singapore dollar. There have been a lot of complaints by our businessmen, particularly exporters, lamenting that the exchange rate of the Singapore dollar has been kept very high and this makes our exports more expensive than they should be. The Report quite correctly puts it when it says that the Singapore dollar rate should be set by market forces. Sir, I think, this is a very sensible recommendation and I hope the Government accepts this.”
“Sir, when the Urban Redevelopment Authority was created in 1973, there were noble objectives of implementing a systematic programme of redevelopment of the urban area to create a new and gracious city with better environment for business, residences and for social activities. I do not dispute the fact that the URA has attained this objective, but over the years I feel that the URA has lost sight of some of the objectives. Over the years, aided by a powerful weapon, the Land Acquisition Act, the URA has turned the property market into a property casino, acquiring land at low cost and auctioneering land at very high prices. Having lost sight of the original objectives, the URA has now become the banker in the casino. Having decided to outdo what the other statutory boards are doing in collecting revenue, the URA probably saw to its advantage to continue fuelling property prices to go up. Sir, as an example, just to give an idea to Members, in the five years between 1980 and 1985, the URA made a surplus of $940 million on revenues of $1.2 billion. That is 78% surplus on revenues collected in five years; and its accumulated surplus today amounts to a whopping $1.2 billion. Sir, the property market would also not have found itself in the mess that it is in today if the URA had not been assisted by another powerful instrument in the Ministry of National Development, the imposition and collection of development charges. The exorbitant charges which have been imposed led to the high cost of construction and this, in turn, is translated into more expensive space, higher selling prices, higher rentals for shops, offices, houses, factories. Last year when I lamented on this, the Minister promised that he would reduce development charges.”
“The interest that the SDF earns from fixed deposits of what it has accumulated over the years would be almost enough to pay for the grants that it gives out every year. Sir, I think it is time for us to consider suspending entirely SDF contributions at a time when every cent saved counts for every company. And again, Sir, it is no secret that the SDF grants, meagre as they are, go only to big companies. Small companies, because they are either too small to organize systematic training schemes or because the SDF does not attach the importance that it should give to small companies, are often left out. So what you find is a situation where small companies contribute a lot of money to the SDF but they get nothing in return. Sir, I would now like to make some comments on the construction slump which has been covered in the Report. The Report admits that the supply of property today exceeds demand. What I cannot agree with is the statement in the Report that "the market, given time, can be left to sort out by itself." I think, Sir, this is a wrong statement. In fact, it smacks of some irresponsibility because the Government contributed to this problem. I have said in this House last year, I said it the year before and I intend to repeat it again. Unfortunately, the Minister for National Development is not here. I think the Ministry of National Development is to blame for this problem. The Urban Redevelopment Authority and the Ministry must accept some blame for the problem which has been created in the property sector.”
“Why can the Government not take this big fat surplus that the statutory boards have earned, besides setting aside what is necessary for the statutory boards for their operations, for their development, transfer what is left to the Consolidated Fund? I feel that if only half of the surpluses made by the statutory boards, and that is only the top 10 statutory boards, there are 30 of them, is transferred annually to the Government, it would more than make up for the revenue shortfall when the corporate and personal taxes are reduced. Sir, I think Government must now make a stand on this matter. As the Member for Siglap has said, some statutory boards now even see the accumulation of surpluses as their objective rather than the provision of services which they were set up to do. Some statutory boards have very ingenious ways of covering up their surpluses. They call it by various names, capital accounts, capital reserves. In fact, one statutory board even transfers almost all its surpluses into a development account, whether it does any development or not. Sir, the question of surpluses of statutory boards also reminded me of the Skills Development Fund. It was very timely, I suppose, that the Annual Report of the SDF was released yesterday and it all came out in the newspapers today. Sir, the SDF collected $108 million in 1985. That is only a bit lower than the figure of $112 million that the SDF collected in 1984 in spite of the SDF contribution having been cut by half since April last year. But what is even more amazing is the low level of grants which the SDF dishes out to companies. Last year, only $42 million in grants were given. And $42 million out of the total accumulated fund of over half a billion dollars is certainly peanuts.”
“Fourthly, Sir, I need not mention the adverse effects sales tax is likely to have on the retail trade and on tourism. One can argue, as has been suggested yesterday, that the indirect tax could be imposed selectively. In other words, perhaps to impose it on certain things which are not necessities, or not to impose taxes on items which are bought by tourists, or perhaps not to impose tax on hotel charges, etc. But selective imposition of indirect tax can only open up a can of worms. How and who is to decide what are the exemptions? So I am very much against this idea of imposing an indirect tax. The reduction in the corporate tax, personal income tax and the 30% across-the-board investment allowance will mean a loss of revenue of $1.2 billion to the Government. How to make up for this shortfall then, if indirect tax is not the answer? Sir, I was reading an article just the other day regarding the surpluses made by our statutory boards. This topic unfortunately did not receive much attention by the Economic Committee. But I would like to point out to the House that the top 10 statutory boards in Singapore earned $2.5 billion last year. It was a bit more in 1984 when these 10 statutory boards made $2.65 billion. To give you all an idea of how big this surplus is, the top 10 companies listed on the Stock Exchange of Singapore, which includes Singapore Airlines and the big banks, only made a total of $1.1 billion. But the 10 statutory boards made $2(r) billion! So you can see for yourself, Sir, that the amount accumulated by these money-gobbling monsters is certainly mind boggling.”
“And perhaps what is also a danger to the world economy is the drop in the price of crude oil. While this may bring a lot of joy to motorists, let us not forget that a drop in the price of crude oil will bring a lot of problems to many countries which depend on oil for revenue. And there are a lot of banks which have made a lot of loans to oil-producing countries. Sir, I would now like to move to specific matters raised in this Report. First of all, the taxation policy. I welcome the proposal to reduce corporate tax. Firstly, because it would ease the cash flow of many companies, especially at a time when everybody is tight of cash. Secondly, the reduction in corporate tax means that there would be more money in the profits for companies to reinvest. But what I am against is the recommendation in the Report to introduce indirect taxes to compensate for the loss in revenues. The Report states that consumption taxes or indirect taxes would economically be preferable to income taxes. Sir, I feel that nothing could be further from the truth. Indirect taxes in the form of sales tax or value added tax, or whatever tax the Government may think of implementing, have many disadvantages. Firstly, by using indirect taxes to compensate for the loss of revenue when corporate tax is reduced is like taking from one hand what is given it back to the other. Secondly, Sir, indirect taxes and sales taxes force up prices and are, in fact, inflationary. It adds to the prices of goods, which means people will then in turn demand more wages and this will feed inflation. Next, indirect taxes penalize the lower-income groups who tend to spend a greater portion of their income on the taxes to buy goods including necessities. Therefore, indirect tax is not as equitable as personal income tax.”
“It is to our pride that, unlike the plight of many other countries in the world, we can sit here today to decide the measures to take to get out of this recession. We are not in debt to others, and we do not have banks or the IMF to tell us what we can or cannot do to get out of the recession. We decide our own destiny. Nobody tells us what kind of austere conditions we must impose on our people if loans are to be fed to us to prop us up. We are not in that kind of a situation. Let me just give Members an example. Sir, Brazil's economy grew by 7% last year, but Brazil has to pay US$10 billion a year to the foreign banks just to service its loans. We are thankful, Sir, that we are not in that kind of a situation. Sir, I would now like to turn to the Report of the Economic Committee. A lot of emphasis and publicity have been given to the Report. But I would like to sound a word of caution, ie, a lot of false expectations have been raised. Many people outside feel that everything would be all right after this Report is implemented. I would like to caution that this is not the case. Even when the Report is accepted by the Government and the recommendations are implemented, the fundamental problems that confront us still remain. We have excess capacities all over Singapore, excess capacity in ship-repairing and ship-building which form 25% of our manufacturing sector. We have excess capacity in the oil refining industries. We have excess office space, shop space, factory space, residential space, and we have excess hotel rooms. Then, of course, as other Members have pointed out, there is the slowdown in international trade aggravated by continued increase in protectionism. Regional instability is again another factor which has been brought up.”
“Sir, I am very much against the accusations which have been made yesterday by the Member for Anson when he said that the economy has been mismanaged. Sir, I take a very strong exception to the word "mismanagement". It is always easy to point a finger with the benefit of hindsight. Let us be honest with ourselves. Most of the policies have served us well in the past when conditions were different. I am one of those who have said so on many occasions that if policies have become outdated, or they no longer serve us well because conditions are now different, then we should review and make the changes when necessary. And that is what the Government has done in setting up the Economic Committee, and I believe this Government will constantly do that, ie, review policies, for that is the hallmark of any dynamic and capable government. But to say that the Government has mismanaged the economy for so many years is an untruth. It shows the Opposition Members to be the opportunists that they are. Let me ask them. Is it mismanagement of our economy that has brought about homes for Singaporeans? Is it mismanagement that has given us the highest standard of living in Asia outside Japan? And even, Sir, if we do not reach the Swiss standard of living so fast and I am sure like most others, we are all prepared to wait till 1999 for that I am proud that in Singapore we already enjoy a per capita income level that is higher than most developing nations and, in fact, higher than a lot of developed nations. What is most important, Sir, and this nails down the lie that the economy has been mismanaged, is that even if we have suffered negative growth of 1.7% last year, our country remains debt free. I think this point has been missed by a lot of people here.”
“Sir, I recall that last year when I spoke of how bad the economy was, I was accused no less than by the then Minster for Trade and Industry and by the Minister of State that I was perhaps over-exaggerating the problems, and there were stout defences from the Government side as to how well in fact the various sectors of the economy were doing. I feel that if only the Government had listened a bit earlier to calls from Backbenchers on this side of the House, in particular the Member for Rochore when he lamented the high cost of business, particularly the high contributions to the CPF that employers have to make, or if the Government had listened to my friend, the Member for Whampoa when he warned on many occasions how we were overheating the construction sector, and how this was in fact distorting our growth figures, I think perhaps some of the damage might have been limited. Sir, that was in March last year and at least I am glad to say that within three months, the Government's stand took an about-turn and it was then singing a different tune, and it started to set up the Economic Committee which has worked very hard to review everything, all and sundry, to see what can be done to set matters right. I am not here to point out to the Government to say, "I told you so." But what I want to say is that while it is correct to defend your policies, one must be receptive all the time and to try to hear the other side before things get worse. But before the two Opposition Members get too excited over what I am saying, perhaps I should now point out to this House the difference between what they are trying to say and what we the PAP Backbenchers are pointing out.”
“Mr Speaker, Sir, I rise in support of the motion by the Member for Changkat and request the House to reject the amendment proposed by the Member for Anson. Sir, the Economic Committee's Report is, I believe, a watershed in the history of our country. This Report questions fundamental assumptions that are no longer valid and it recommends radical and drastic changes to many policies, some of which have served us well in the past; some perhaps not too well. Much as I welcome the publication of the Report, and I know the Government intends to implement the recommendations very quickly, my only regret, like many others, is that the Government was probably a bit slow in this case in coming to grips with the problems that confront the economy now.”
“Mr Speaker, Sir, whilst supporting the Bill in general, I rise to express my concern over clause 2 of the Bill which is to prevent any form of legal proceedings being taken against anyone who works for the MRTC. I know that this is to bring it in line with the rules concerning other statutory boards. But I am wondering whether, in fact, this is the right thing to do. Sir, in effect, such a clause gives a blanket insurance to people who work for the MRTC or for our statutory boards. It actually means that should a mishap occur a victim cannot seek recourse against the erring person except against the Corporation. Sir, let me give an example. If an accident involving a train should occur, the victim or the family of the victim can only sue the Corporation and cannot sue the train driver for negligence because this clause would bar the victim or the family of the victim from seeking such a wide course of action. I am afraid such a clause might give a false sense of security to the people who work for the MRTC, and it might make them less conscious of the regulations governing safety which is of particular concern especially at a time when we are trying to inculcate safety consciousness.”
“Sir, may I ask one more question? One of the reasons for the Pan Electric fiasco was obviously the fact that there was insufficient corporate disclosure. Would the Minister consider introducing legislation to require companies to disclose more frequently and timelier their corporate debts? And would he also require the companies to submit audited accounts on a more regular basis than is required at present?”
“Mr Speaker, Sir, I noted that the Minister would like to see the development of a healthier securities market in Singapore. Bearing in mind that our present stock market is a rather small one, thus allowing speculators ample opportunities to rig the market as he said earlier, would he not then consider allowing more companies to be listed on the stock exchange so that we have a broader based market, which means in fact easing the regulations for listing.”
“Mr Speaker, Sir, I think the Minister has misunderstood the point. It is not the remisiers who have brought about this whole fiasco but the owners of certain stockbroking firms. And does not the Minister feel that there is no justification that people who are not involved in any way are being made to pay a penalty by way of 25% of their income? Where is the justice?”
“Sir, would the Minister explain why remisiers are being made to fork out a quarter of their income to guarantee this lifeboat fund, when it is actually the owners of the stockbroking firms and not the remisier themselves who have got them into trouble in the first place?”
“Sir, what is the rationale for asking all stockbroking firms to guarantee the so-called lifeboat fund? Why should the firms which operate strictly within the rules and bye-laws of the Stock Exchange of Singapore be made to bail out those who were probably too greedy in the first place and got themselves into trouble?”
“Sir, why is it that the audits of the stock broking firms did not reveal the existence and the size of the forward contracts, and why was the attention of the authorities not drawn to this matter?”
“Sir, perhaps the Hon. Minister might not be too reluctant to enlighten this House as to who it was who provoked the warden to return the $10 which was so generously given to him by the senior officer.”
“Sir, in view of the large profits enjoyed by the newspapers because of their monopolistic position, does he not feel that the price increases are unjustified? BG Lee Hsien Loong: Mr Speaker, Sir, the question is predicated on an assumption that the newspapers enjoy large monopoly profits which, I think, the Member ought to justify to the House before I could proceed to the second part of his question. TEMPORARY GRADUATE TEACHERS SCHEME (Recruitment and training) 11. Mr Philip Tan Tee Yong asked the Minister for Education, with reference to the recruitment of temporary untrained graduate teachers, (a) what alternatives have been considered; (b) why graduates, who read non-teaching subjects at university and previously were considered not suitable for teaching, are now considered suitable; (c) whether the two-week training is sufficient for them to cope with Secondary 5 pupils; and (d) why 600 teachers are needed for 8,000 pupils in the two levels in 1986, as it works out to a teacher/pupil ratio of 1:6.66, assuming that the 4,000 Secondary 5 students are an addition to the present 4,000 Secondary 4 students.”
“Sir, could the Minister of State advise why the answer is no? If I got him correctly, he said that there should be competition. In this case it is a company which enjoys a monopoly in newpaper publication and yet no action has been taken.”
“Sir, in view of the answer that has been given, does the Minister of State consider the recent price increase of newspapers belonging to the Singapore Press Holdings an act of profiteering and an abuse of its position as a monopoly in Singapore? If so, what action does he propose to take? BG Lee Hsien Loong: Mr Speaker, Sir, the answer must be no, otherwise the action would have been taken already.”
“The general knowledge that the Government will do so has helped to keep companies in line. So far, this policy has served us well.”
“Sir, will the Minister of State state specifically when the import duty will be removed? BG Lee Hsien Loong: Mr Speaker, Sir, without giving any hostages to fortune, I may say that the long term contracts expire in 1987 and it is our objective to have the sugar trade liberalized by then, if not before then. PROFITEERING BY COMPANIES (Steps to prevent) 10. Mr Tan Soo Khoon asked the Minister for Trade and Industry what definite steps are being taken by the Government to prevent profiteering by companies, in particular those which enjoy a monopoly in their trade or business. BG Lee Hsien Loong (for the Minister for Trade and Industry): Mr Speaker, Sir, the best way to prevent profiteering by companies is to ensure that there is free competition. This is why MTI has been vigilant in ensuring that as free a market as possible exists in our domestic trade, particularly where essential commodities are concerned. Where by the nature of the trade a single company has a substantial monopoly, a completely free market is not possible. However, even in such cases, the Government should not rush to interfere by controlling prices itself. Doing so would require a cumbersome bureaucratic machinery, which consumers would ultimately have to pay for. Besides, recent experience has shown that the Government is not always in the best position to know what the correct prices should be. I am sure hon. Members will remember examples over the last few months. The Government's policy is therefore to allow firms to set their own prices. However, where there is clear evidence that a cartel is fixing prices unfairly, or a monopoly is abusing its position to raise prices, the Government will not hesitate to act against them.”
“There is no means to protect the interests of the locally established trading companies which have in some way contributed to our economic and social progress.”
“Sir, may I just point out that I also mentioned about counterfeiting of trademarks, and I hope this matter will be raised with the Minister for Law. Mr Eric Cheong Yuen Chee (Toa Payoh): Mr Speaker, Sir, the question I want to raise with the hon. Minister of State is whether there is any policy on the setting up of foreign trading companies without any manufacturing and/or assembly facilities in Singapore. Sir, we are aware that the EDB and other Government agencies have been instrumental in not only promoting investments but also assisting them in R&D projects and marketing, etc. Some of the industries have also contributed to the transfer of technologies or management expertise, and to our economic progress, and providing jobs for our people. In the case of foreign trading companies, such benefits are negligible. Some of these are principals of locally established trading houses which have been operating here for many, many years. Over the years they have developed a sophisticated marketing system in Singapore. Some of these companies have also contributed to the development of local managerial expertise. One has just to look through the staff list of many of these locally established companies, one will have noticed many of the senior positions are held by Singaporeans. But with the establishment of these foreign trading companies, particularly from Japan, which merely take back their product lines from the former local agents, there is a significant increase in expatriate personnel. Some of the functions of these expatriate personnel can, in my view, be performed by our local executives. There is no transfer of technologies or management expertise. In some instances, it resulted in retrenchment of local employees.”
“Mr Speaker, Sir, last year in this House I raised the question of whether penalties will be increased for those people who were caught counterfeiting goods, and I raise this question again this year because of what I believe is a growing problem, particularly in the piracy of computer software or what we have now come to call as the imitation of intellectual property rights. My concern was drawn to this matter this year because recently we read that the failure on our part to combat this problem of the piracy of the intellectual property rights has led to certain countries threatening to withdraw whatever trading privileges that we enjoy with them. Could I have the comment of the Minister, please?”
“Surely it must be by the number of summons he issues. What other criteria could there be? My opinion is that the traffic policeman's image should be revamped. He should project a friendly image, just as his counterparts in the NPP Scheme are doing. I feel that if we can make the public understand that the traffic policeman is their friend and not anything else, then I feel we will be able to carry this message of road safety one step further.”
“But last year this figure went up tremendously to 16. May I know what action is being taken with regard to this particular category of road users. Lastly, I would like to raise this point of the image of the Traffic Police. Sir, I feel that this is something very important which we have to deal with, when we talk about road safety. Somehow, Sir, in Singapore, the traffic policeman is still being looked upon with some fear or some disdain. For instance, we still have the sneaky ones who hide behind bushes or on slip-roads leading to expressways, waiting to pounce on innocent motorists. And the image is given of a traffic policeman who is waiting like a vulture. I am sure Members in this House will bear me out when I say that those of us who drive regularly along certain roads will be able to tell at which particular spots you can spot your favourite traffic policeman. Secondly, Sir, I think the traffic policeman should be clear in his signals when he wants to indicate what motorists and drivers should do. I have received complaints from motorists who tell me that suddenly they see in their rear-view mirror the traffic policeman following behind them for quite a distance. They do not know whether they have been driving too fast or too slow. If they feel that they have been driving too fast, then they slow down. Then they are nabbed for road hogging. If they think they have been driving too slowly and are hogging the road, and they speed up, then they will be caught for speeding. Although we know for sure, and this has been told to us by the Minister for Home Affairs previously, that traffic policemen do not have a quota in so far as issuing of summons is concerned, but how do you judge a traffic policeman as far as his performance goes?”