Teh Cheang Wan
Singapore
“The Board does not propose to reinstitute the procedure for the resale of flats at the respective Area Offices in Ang Mo Kio New Town. As a pilot project, the Board has centralised the resale of Ang Mo Kio flats at Sales Section, Maxwell Road.”
“At the contract price or whatever it is, and this is due to the mistake made by the HDB, the HDB has been quite generous. If the mistake made by the HDB staff has been to sell the flat at lower than the posted price, then the owner has the benefit of this mistake.”
“The Member for Potong Pasir is asking a question which I have to check for an answer. I do not carry with me the millions of accounts of HDB flat-owners with me. So I cannot give him an immediate answer. But I can assure the Member for Potong Pasir that those people will be refunded.”
“Mr Speaker, Sir, since the announcement by HDB on 4th July 1986, 49 HUDC lessees appealed to the Board to buy their flats. All were unsuccessful. As at 20th September 1986, 27 HUDC flat owners had sold their flats in the open market. Twelve of them sold their flats above their original purchase prices.”
“Mr Speaker, Sir, since the implementation of the policy, HDB has resold 13 HUDC flats from among those flats HDB bought back from the HUDC owners. In addition, HDB has sold 44 new HUDC flats. The slow sale of HUDC flats is due mainly to the depressed property market.”
“Mr Speaker, Sir, I have no figures readily available as to how many of these 49 HUDC flat-owners who requested the Board to buy back the flats have committed themselves to buying other property.”
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“The Member for Potong Pasir is talking about construction cost. He cannot buy a flat without the infrastructure, without the architect preparing the plan, without the land. What is he buying? He must buy the flat with the whole infrastructure. An hon. Member: Buy a piece of land.”
“Construction cost is higher than the selling prices of flats. Of course, and if the Member for Potong Pasir adds the other costs, it would be much higher. It is just like when a person is buying a flat from any private developer. He cannot ask the private developer what is the structural cost of the flat. Of course, the private developer will say, "No. My cost is not just for the structure alone. It must include the architect's fee. It must include the infrastructural cost. It must include land cost and it must include my financing cost. That is my total cost."”
“Because the hon. Member for Potong Pasir repeats the question and I have to repeat the same answer.”
“Mr Deputy Speaker, Sir, I have answered the question quite clearly. When a person buys a car, he does not just ask for the price of the four tyres. He asks for the price of the whole car.”
“Mr Deputy Speaker, Sir, it appears that the Member for Potong Pasir has only absorbed part of my answer which I gave just now, ie, on the construction cost, and he appears not to have absorbed the other parts. In the building industry, the total cost, as I have stated in my answer, is the structural cost, the land cost, the infrastructural cost, the financing cost, the professional fees. These added together form the total cost of the flat. If he is just taking part of the costs, then it does not constitute the total cost. It is just like when a person is going to buy a motor-car, say, a Mercedes-Benz 190. He asks the salesman of the firm, Cycle & Carriage, which sells the car, "What is the cost of these four tyres?" The salesman says, "These four tyres cost $600." Then he says, "This is most unreasonable. The tyres cost $600. How can you sell the car for $100,000?"”
“The question Singaporeans face is how to modulate or moderate this transition from very heavily subsidized HDB prices to free market prices after all land which is available for public housing is used up. This problem is being studied by a Ministerial Committee, comprising Mr Dhanabalan, Mr Ong Teng Cheong, Dr Yeo Ning Hong and myself.”
“93 - 94) Had the Government sold the land for Potong Pasir Estate, it would have fetched $1,500 psm. The imputed land cost for Potong Pasir Estate is therefore $255,356,800. In addition to the building cost, the HDB incurred the following costs in the development of Potong Pasir: Infrastructural Cost - $7,490,500 Professional and - $5,083,300 Administrative Overheads Financing Cost - $10,144,700 The total development cost, inclusive of land cost, was thus $454,765,000. The total proceeds from the sale of the 3,634 flats was only $228,380,000. Therefore, the Government subsidy for the development of Potong Pasir Estate amounted to $226,385,000. This works out to a subsidy per flat of $62,296 or 99% of its purchase price. It is the Government's policy to keep public housing at prices within the reach of Singaporeans. However, even if the Government continues to provide heavy subsidies for public housing, the present pace of building 40,000 new dwelling units a year cannot be sustained indefinitely. The simple reason is that Singapore has only a finite land area. At the present pace of construction, all available land for 400,000 units of public housing will be exhausted in 10 years' time. These additional 400,000 units plus the rebuilding of the older HDB rental blocks can provide enough units to meet the Government's aim of a 100% house ownership society. However, when the land bank is used up, and Singapore has to depend on land obtained from the demolition and rebuilding of old HDB blocks or other built-up properties, the prices of flats will rise steeply. In other words, those who come on to the housing market after the land bank is. used up, must either inherit a flat from their parents, or buy an existing flat at free market prices then prevailing.”
“Mr Deputy Speaker, Sir, the values of structural works on contracts 1 to 7 at Potong Pasir Estate, inclusive of piling but excluding infrastructural, professional and administrative overheads, financing and land costs, are as follows: Contract 1 - $27,334,993.79 Contract 2 - $33,670,441.29 Contract 3 - $27,297,283.11 Contract 4 - $24,841,645.83 Contract 5 - $25,196,386.46 Contract 6 - $21,218,370.79 Contract 7 - $17,130,589.65 Total - $176,689,700 (rounded off) The numbers of flats built are: Contract 1 - 516 units Contract 2 - 614 units Contract 3 - 405 units Contract 4 - 532 units Contract 5 - 537 units Contract 6 - 558 units Contract 7 - 472 units Total - 3,634 units The types of flats built for each contract are as follows: Contracts 1 & 2 - 3-room Model A, 4-room Model A and 5-room Model A Contract 3 - 3-room Model A, 4-room Model A, 5-room Model A and Executive Apartment Contracts 4 & 5 - 3-room Model A and 4-room Model A Contracts 6 & 7 - 3-room New Generation and 4-room New Generation Based on the successful awards, the average construction costs of flats built, excluding infrastructural, professional and overheads, financing, and land costs, are follows:- 3-room New Generation - $31,100 3-room Model A - $42,700 4-room New Generation - $41,900 4-room Model A - $58,900 5-room Model A - $71,800 Executive Apartment - $78,500 I have earlier circulated to hon. Members a statistical table (Cols. 93 - 94) showing evidence of land value. The table lists ransactions of private residential land in areas comparable to Potong Pasir between March 1981 and March 1984. Based on the evidence, the land at Potong Pasir which as a permitted planning density of 706 pph, has been very conservatively valued at $1,500 psm. table - EVIDENCE OF LAND VALUE (Cols.”
“Sir, the proposal to build funeral parlours in HDB estates is still being studied by the HDB. The HDB will take into account the sensitivities of residents to this new concept when finalizing the policy. Unlike traditional funeral parlours in Chinatown, funeral parlours in HDB estates, if built, will be self-contained, air-conditioned buildings sited away from apartment blocks. The view of the funeral parlours from apartment blocks will also be adequately screened. Funeral rites will be totally confined within the building to prevent disturbance to the neighbourhood. The plan to build a funeral parlour at Clementi Avenue 6 has been deferred pending a policy decision on the matter. HDB FLATS AT POTONG PASIR ESTATE (Particulars of construction costs) 4. Mr Chiam See Tong asked the Minister for National Development (a) what were the values of successful awards for construction of Housing and Development Board flats at Potong Pasir New Town; (b) what was the number of units of flats built for each of the successful awards; c) what were the types of flats built for each of the successful awards; and (d) what was the average cost of each flat built in relation to the successful awards.”
“Sir, the HDB has long-term plans to build multi-storey car parks in HDB estates where there is a shortage of parking lots and insufficient space to build surface car parks. Studies are being made on the parking needs of all HDB estates. FUNERAL PARLOURS IN HDB ESTATES (Policy) 3. Dr Wang Kai Yuen asked the Minister for National Development (a) what is the current policy of having funeral parlours sited within Housing and Development Board housing estates; and (b) whether the plan to build one at Clementi Avenue 6 has been cancelled.”
“The Masjid Angullia will be demolished as part of the comprehensive redevelopment programme for the Orchard Road Area. However, recognising the needs of Muslim workers in the Orchard Road area, the Urban Redevelopment Authority has leased to Majlis Ugama Islam Singapura a space within its Cairnhill Place residential project for use as a prayer hall. The Masjid Angullia will not be demolished until the URA project is completed in July 1987. [Copies of Chart and Tables distributed to Members] - Gross Domestic Product at 1968 Factor Cost, Singapore's Economy as a Whole Gross Domestic Product at 1968 Factor Cost, Gross Domestic Product by Sector at 1968 Factor Cost (Cols. 1791 - 1794)”
“Mr Speaker, Sir, Pachitan Estate will have about 1,000 units of 4-room, 5-room and Executive flats. There will also be a badminton court and two children's playgrounds. Tenders will be called in early 1986 for completion by early 1988. As Pachitan Estate will only have 1,000 dwelling units, it will not be able to sustain a neighbourhood centre with shopping facilities. However, at a later stage when an MRT station is built nearby, a neighbourhood centre with shops, a supermarket and other facilities will be developed. STREAMING (Advantages) The following Question stood in the name of Mr Ng Kah Ting - 3. To ask the Minister for Finance, Minister for Education and Minister for Health (a) what success has been achieved in reducing education wastage; (b) what measures have been and should be introduced to enable each child to learn at his or her own pace; and (3) whether these measures will affect the basic objective of giving equal opportunities in education to all children.”
“Mr Speaker, Sir, the PWD will be providing a pedestrian crossing across Bedok North Road in the vicinity of Block 54 Chai Chee Street and Block 542 Bedok North Street 3 in the second half of this year. The type of crossing to be provided will depend on the outcome of the site studies currently in progress. The PWD has started the construction of a slip road at the junction of Bedok North Road and Bedok North Avenue 1 as part of the overall scheme to improve the traffic flow at the junction, The work will be completed in about two months' time. PACHITAN ESTATE (Development) 2. Encik Yatiman Yusof asked the Minister for National Development whether his Ministry has finalized the plan for Pachitan Estate on the number and types of flat it intends to build and whether there will be enough facilities for the proposed neighbourhood.”
“Mr Speaker, Sir, yes, there have been cases referred w the Leases Committee. EFFECTS OF INCREASE IN ROAD TAX AND AD VALOREM DUTY ON PETROL 2. Dr Koh Lam Son asked the Minister for Communications and Information, Second Minister for Defence and Second Minister for National Development, since the increase of the ad valorem duty on petrol from 50% to 60% is a substantial increase in the cost of petrol to the motorists, whether this measure will (i) reduce the present road congestion and prevent it from getting worse, and (ii) reduce further the 7.3% growth of the car population in 1984. The Minister for Communications and Information, Second Minister for Defence and Second Minister for National Development (Dr Yeo Ning Hong): Mr Speaker, Sir, the increase in road tax and ad valorem duty on petrol was only introduced earlier this month. It is too early to comment on its effect. The previous increase in road tax and ad valorem duty on petrol in October 1983 brought the increase of cars from more than 13% in the early part of 1983 down to 7.3% in 1984.”
“Mr Speaker, Sir, if the owner of an HDB flat wishes to dispose of it in order to buy another HDB flat, the 30-month debarment would not apply. He would be able to register a new application immediately or even before he sells his present HDB flat. On the other hand, if the residential property to be disposed of is a private property, the 30-month debarment would apply. Nevertheless, the HDB is not rigid and inflexible. In instances where elderly people or retirees wish to dispose of their private residential property to purchase an HDB flat, they may appeal for waiver of the 30-month debarment. The Leases Committee would consider each appeal on its own merits and grant waiver of debarment if there are valid reasons for the resale of the private property.”
“The vacant land next to Block 45, Telok Blangah Drive, is earmarked for new Housing and Development Board flats. Tenders will be called in the First Quarter of 1986. The land, being undulating and not turfed, is not suitable for use as a temporary football field. Residents are currently playing football in a large field at the junction of Henderson Road Extension and Telok Blangah Way and may continue to do so. LOOP BUS SERVICE IN TELOK BLANGAH 3. Dr Koh Lam Son asked the Minister for Communications and Information, Second Minister for Defence and Second Minister for National Development, whether the Singapore Bus Service (1978) Ltd will consider introducing a loop-bus-service to serve Telok Blangah Estate, Depot Road Estate and the Radin Mas Neighbourhood during the morning, mid-day and evening peak hours.”
“Work is now in progress for the development of Mt Faber Park Extension in Telok Blangah: The facilities being constructed include jogging tracks, footpaths, fitness corners, picnic areas, park lightings and other park furniture. These facilities will be completed by mid-1985. The existing road will also be improved and car and bus parking facilities provided by the end of this year. In addition, the Parks & Recreation Department is drawing up plans for a viewing platform surrounded by terrace gardens at the peak of the ridge. When completed, the platform will offer visitors panoramic views of the harbour, Southern Islands, Jurong and part of the city. VACANT LAND AT TELOK BLANGAH DRIVE (Conversion into Football Field) 2. Dr Koh Lam Son asked the Minister for National Development whether there is any development plan for the piece of vacant land between Fairway Condominium and Block 45, Telok Blangah Drive and, if there is no immediate plan, whether the land can be temporarily converted into a football field as there is no such facility in Telok Blangah Estate.”
“Yes, those who would like to move out earlier would be paid the resettlement benefits earlier. MOSQUE BUILDING PROGRAMME (Progress) 2. Mr Abdullah Tarmugi asked the Minister for the Environment what is the progress of phase two of the mosque building programme and what are the expected completion dates for the remaining mosques in this phase.”
“Mr Speaker, Sir, the resettlement of 346 cases in Kampong Siglap will commence in mid-1985. The area is expected to be completely cleared by mid-1986 and is earmarked for residential development.”
“Mr Speaker, Sir, in about three months' time the Area Offices should be able to draw up the plan. SKILLS DEVELOPMENT FUND (Grants) 3. Dr Wang Kai Yuen asked the Minister for Finance, Minister for Education and Minister for Health (a) what is the number of persons whose training since January 1980 has been subsidized by the Skills Development Fund; and (b) how many of them earn more than $750 thereby paying no SDF levy; what is the amount of their subsidies as a percentage of the total and what is their salary distribution.”
“Mr Speaker, Sir, rusty water is normally caused by the corrosion of galvanized steel downfeed pipes, The HDB currently has a programme to replace the pipes of apartment blocks receiving water from reservoirs with high chloride content. The new pipes will be made of UPVC or other non-corrodible materials. Pipes of apartment blocks receiving water from reservoirs without a high chloride content will also be examined to see whether they need to be replaced. Since 1982, the HDB has been using non-corrodible pipes in its new apartment blocks. The HDB also has a regular programme of flushing, cleaning and repainting its water tanks. For a longer term solution to the rust problem, the HDB is studying the use of reinforced concrete and fibre-glass polyester tanks instead of steel tanks.”
“The charge is the standard rate for a multi-storey car park. There are two rates, one for an open car park and the other for a multi-storey car park which is at a higher rate. So this higher rate will be the standard rate for the multi-storey car park. MAIN AND DEVELOPMENT ESTIMATES OF SINGAPORE FOR THE FINANCIAL YEAR 1ST APRIL, 1985 TO 31ST MARCH, 1986 Order read for resumed consideration in Committee of Supply [3rd Allotted Day]. [Mr Speaker in the Chair] 11.20 am Head N -”
“Sir, I do not have the information on the size of the car park. However, I will give this information to the Member for Ang Mo Kio when I obtain this information from the HDB. Dr Arthur Beng Kian Lam (Fengshan): Sir, what will be the season parking charge in the multi-storey car park, if this is envisaged, say, in other new towns also?”
“Mr Speaker, Sir, the HDB is aware of the parking problem in Ang Mo Kio Town Centre. A multi-storey car park, to be completed in 1987, will be built in Ang Mo Kio Town Centre. Mr Yeo Toon Chia( In Mandarin): Sir, I would like to know how many cars can be parked in this multi-storey car park?”
“Mr Speaker, Sir, I think this is agreeable and I will ask the HDB to look into it. MULTI-STOREY CAR PARK IN ANG MO KIO NEW TOWN CENTRE 5. Mr Yeo Toon Chia asked the Minister for National Development whether there are any plans to build a multi-storey car park in Ang Mo Kio Town Centre in view of the acute shortage of parking space.”
“Sir, the HDB has to investigate the pipes first. If the number of pipes is only a few, then the changing of the pipes can be carried out quite quickly. However, if the number of pipes involved is very large, then a tender has to be called, and therefore it will take some time to change these pipes. However, I would like to assure the Member for Ang Mo Kio that the HDB will look into this as a matter of urgency.”
“Mr Speaker, Sir, unlike some other HDB estates, the 45 blocks in Ang Mo Kio Constituency do not receive water from reservoirs with high chloride content. Rusty water there is probably due to old pipes. The HDB will survey each block to ascertain the condition of the pipes. Where necessary, the pipes will be replaced. Mr Yeo Toon Chia (Ang Mo Kio)( In Mandarin): Sir, when will such rusty pipes be replaced?”
“Sir, the vacant land opposite Ang Mo Kio Avenue 1 is part of Bishan New Town. It is designated as a public open space and is planned to be used as a recreational park. The HDB has already provided ample parking facilities for heavy vehicles in Ang Mo Kio New Town. Ang Mo Kio Industrial Park 2 has a centralized lorry park with a total of 303 lots. RUSTY TAP WATER IN ANG MO KIO NEW TOWN 4. Mr Yeo Toon Chia asked the Minister for National Development if he is aware that, despite the periodic flushing of water tanks in Ang Mo Kio New Town, most of the residents are still complaining of rusty tap water; and whether the Housing and Development Board will consider replacing all corroded galvanized iron downfeed pipes to stainless steel pipes and, if so, when.”
“Mr Speaker, Sir, I will give the hon, Member the figures. I do not have them with me now, but I will send them to him in writing. VACANT LAND ALONG ANG MO KIO AVENUE 1 3. Mr Yeo Toon Chia asked the Minister for National Development what plans he has for the vacant land along Ang Mo Kio Avenue 1 fronting the apartment blocks; and whether it is feasible to convert part of the vacant land into a car park for heavy vehicles as there are insufficient parking lots for such vehicles in Ang Mo Kio New Town.”
“Mr Speaker, Sir, there are several reasons for HDB exercising its powers. For instance, instalment arrears, that means they bought the flat and are not able to pay the instalments; unauthorized subletting and assignment without HDB's approval. Another reason is non-occupation of an HDB flat, in other words, a person has bought the flat but never occupied the flat, and has left the flat vacant. There are also cases of making false declaration in the application; a misuse of premises, such as using the flat as a brothel. Then there are cases of ownership of private property. Under the HDB rules, HDB flat owners are not allowed to own private residential property. But the person did not declare his ownership of a private property, which means he is not qualified to buy HDB flats, and therefore he has bought the flat under false declaration. And there are others who did not serve the bond imposed on them. For example, in every block of flats two or three units would be allocated to Police officers. These Police officers, who have got the priority of allocation, have signed a bond to serve the Government for a certain number of years, and perhaps half-way through the bond they got a better job and resigned from the Police force. This means that they have broken the bond and the flats have to be returned to HDB.”
“Mr Speaker, Sir, for the five-year period from 1980 to 1984, the Board recovered 119 flats in exercise of its powers under Sections 48(A) and 48(B). The breakdown is as follows: 1980 - 5; 1981 - 11 ; 1982 - 29; 1983 - 50; 1984 - 24.”
“I am afraid that has well exceeded a year's rental. As I have said, HDB usually does all sorts of things to try and help these people. To evict a person is not something that HDB would like to do. It is a last resort. NUMBER OF FLATS RECOVERED BY HDB 2. Mr J.B. Jeyaretnam asked the Minister for National Development if he will give the number of flats recovered by the Housing and Development Board over the last five years in exercise of its powers under Sections 48(A) and 48(B) of the Housing and Development Act without proceeding in court, giving the number for each year separately.”
“Mr Speaker, Sir, I think it is more than three months, in some cases it is more than six months.”
“This is not the HDB's responsibility. But HDB officers, during the investigations, out of their own effort, try to help these people. I have mentioned that usually, during investigations, if the people were to say that they are unemployed, HDB officers would try to see if they could help by offering them jobs. But it is not the HDB's responsibility to offer jobs to anyone who is in rental arrears.”
“HDB tries to assist them, but I do not think that HDB has the responsibility of offering jobs to the people who are in rental arrears.”
“On the first point about people on social welfare assistance, the answer is no. I think they received sufficient assistance from the HDB. Usually, if they run into temporary difficulties, HDB will make arrangements to help them. It is the other way. As I mentioned, anybody who is willing to work and is willing to accept any job is able to earn an income to enable him to pay rent.”
“The first was to offer them jobs. They usually said that they could not pay the rent because they were unemployed. Then HDB would try to see how it could help them to obtain employment. And the families sometimes said that they were sick, or for various other reasons which HDB investigators thought that if they deserved assistance from the Social Welfare Department, HDB would refer the case to Social Welfare Department. If the families said they were temporarily out of job and were not able to pay the rent, HDB would arrange for them to pay their arrears by instalments and, if they do pay their arrears by instalments, HDB does not evict them, In the whole of Singapore, with a population of 21/2 million, HDB had evicted eight families in five years, ie, 1.6 families per year. And the Member for Anson thinks that this is a very serious crime, thinking that an enormous number of people have been evicted. I think Singapore is doing very well since only eight families were unable to pay their rents and had to be evicted. It is a very small number.”
“In every case, an investigation was made and assistance was offered, but the families for reasons known to themselves did not want to pay their rent. Mr Jeyaretnam: May I know from the Minister what assistance was offered to these families?”
“Yes. Mr Speaker, Sir, in fact, I know some people in Singapore are starving. But why are they starving? They are on diet! I know of many people who eat only two meals a day. But it is not because they are so poor that they cannot afford three meals. They skip breakfast because they are afraid of putting on weight.”
“For reasons unknown to us, because jobs in Singapore are easily available. Anybody who is willing to work is able to earn an income sufficient to pay the rent. These figures, in fact, figures do not lie, speak for themselves. HDB has 130,000 rental flats and, for five years, only eight families were in rental arrears and were unable to pay and had to be evicted by HDB. Eight families in five years - Mr Speaker, Sir, I think, the Member for Anson is always imagining that Singapore has a lot of poor people. Just a few days ago he mentioned that three years ago he told the foreign reporters that there were thousands of Singaporeans starving.”
“Mr Speaker, Sir, eight families were evicted from rental flats during the period 1980 to 1984 for rental arrears. The breakdown is as follows: 1980 - 0; 1981 - 3; 1982 - 1; 1983 - 2; 1984 - 2. Mr J.B. Jeyaretnam (Anson): Mr Speaker, Sir, would the Minister - I do not know whether he is in a position to answer this - say for what reason these families were unable to pay the rents for which they were evicted?”
“Sir, I fully agree with the Member for Nee Soon that the HDB should be responsible for its design, and if it is defective the cost of rectification to make the market water-proof should be borne by the HDB. I will ask HDB to look into it.”
“I hope that all the resettlement cases, as from today, will be entitled to the enhanced rate of compensation when these rates are finalized and approved. [Applause] Again, during the past few days, on the debate on the budget, there have been many requests from PAP MPs to reduce the rentals of HDB commercial premises in view of the current economic climate. I have earlier given a concession to defer rental increase due in September this year to September 1986. I understand the feelings of Members for other shopkeepers whose rents are considered high due to the present situation. However, I have also indicated that it will not be good for HDB to reduce the rentals as it would encourage higher tenders in future. I fully sympathize with the shopkeepers in their present situation and I will ask HDB, in view of the many representations made, to see how the rentals can be reduced without adverse repercussions on the future tender price. However, tenderers for HDB shops as from today will not be entitled to any concession that may be given, as they are aware of the present economic situation before they put in their bids. [Applause]”
“Sir, perhaps I will take the point by the Member for Jalan Kayu first. The request for those people to ballot their flats next to their parents is part of the Government's policy of keeping the family together. That is certainly agreeable. The Member for Bo Wen has brought up two points. One is to ask HDB to set up a consumer relations unit to act as a bridge between the people and the HDB Area Office. I do not consider this is necessary because, at present, we already have a lot of grassroots organizations. The creation of another unit will only cause delay and not speed up things. We already have CCCs, RCs, MCs and the MPs' Meet-the-People sessions. So creating another organization is not likely to improve the situation. Another point is about repairing of flats in the old estates. I fully agree that those flats which are more than 10 or 15 years old require a very major renovation within the flat itself. HDB is not a financial institution, and it will not be able to provide loans. I understand that commercial banks, private finance companies, as well as POSB, are granting loans for this type of renovations. So HDB will not provide the facilities as other institutions are already providing this. On the request made by the Member for Punggol, I would like to make two statements. One is about the resettlement policy. There have been many matters raised touching on resettlement policy by Members of this House during the debate. I would like to wind up today's answer to the Members on the resettlement policy by saying that the Government will set up a Review Committee headed by my Senior Parliamentary Secretary to review the resettlement rates as well as the various resettlement policies.”
“The answer is yes. It will be a very large subsidy. It can be several hundred million dollars, and hopefully it will not go to a thousand million dollars. Otherwise, my colleague, the Minister for Finance, may be very worried.”
“But in this new accounting system, the actual cost of the flat can be shown very clearly. The HDB is returning the land to the Government. Previously, under the old accounting system, the Government gives the land to the HDB either at no cost or at very low cost. But under this new accounting system, the land cost is properly reflected. And I am very glad that the hon. Member for Potong Pasir has now conceded that there is such a thing as land cost. The land cost will be determined by the Government Chief Valuer. Then the HDB will be able to show the actual cost of the flat: the land cost HDB pays to the Government, the construction cost, the interest cost, the overheads of HDB, the resettlement cost - all these added together to arrive at the actual cost of the flat. The actual cost of the flat, of course, is going to be much higher than the selling price of HDB flats. Government is committed to the policy that by 1999 all Singaporean families will become owners of at least their own homes, 100% home ownership. Since we are committed to that, the selling price of HDB flats will be pegged at not what it costs the HDB to build but it will be pegged at what the people can afford to buy. So there will be a very big gap and, as I have said in my statement yesterday, in the new accounting system Government will subsidize this difference to ensure that all the Singaporeans will be able to own their own homes by 1999.”
“See what is the answer. Because it is only Government which can provide HDB with these long-term repayment loans. In fact, there is no way that you can get a long-term loan from a commercial bank, not even the World Bank, not even any bank by asking them, "Can I borrow money with 60 years' repayment period?" Of course, there is no way that you can get it and also at the cheap interest rate of 7.75%. In fact, this is a very heavily subsidized rate. The Government can use this money and invest in US dollar deposits and today Government would easily get 10-11% returns. So Government is offering this loan to the HDB at 7.75% and this is a heavily subsidized loan. Because nowhere else in the world can you borrow money with a 60-year repayment period. Another thing is that Government has lent money to the HDB for construction of public housing for sale at only 6% interest. The CPF depositor is getting 6.5%, while the Government lends to HDB at 6%. And the HDB, in turn, provides loans for people who purchase HDB flats at the interest rate of 6.25%. This is another subsidy. So, in the old accounting system, the Government is subsidizing the HDB in several forms. But the Auditor-General considers that this form of subsidy, this way of accounting, the HDB is unable to show the true cost of HDB flats. And therefore HDB is switching to the new accounting system. Once we switch to the new accounting system, then we will have a very clear-cut cost of the flats. Because in the old accounting system, we are not able to show the actual subsidy of the Government. The actual subsidy of the Government, as I have explained, is in various parts but we are not able to quantify it as a whole because under the old accounting system, the accounts are treated differently.”
“Mr Deputy Speaker, Sir, on the HDB accounting, either the Member for Potong Pasir does not understand or he tries to twist the accounts. I am not very sure which is which. But let me explain. In the old HDB accounting system, the HDB is receiving subsidies from the Government in several ways. One is that the Government is providing cheap land for the HDB to build public housing. For example, in Queenstown, Government gives land, which previously belonged to SIT, to HDB at no cost, zero cost, to build houses. While in other cases, Government acquires the land and sells it to the HDB at well below market price for HDB to build public housing. This is one form of subsidy. The other form of subsidy is that Government annually provides a grant to the HDB. In the last financial year, the Government provided $174 million to HDB, and for this year's budget, the Government will provide another $149.6 million to HDB. This is the subsidy to the HDB. That is the cash grant. The third is that Government provides cheap loans to HDB. In fact, Government has provided two types of loans to the HDB. One is for HDB to build shops, industrial facilities, rental flats, at 7.75% and on 60 years' repayment. In fact, the Member for Potong Pasir made a big fuss about it, saying that the CPF depositor only gets 6.5% while Government gives loans to HDB at 7.75%. I do not know whether the Member for Potong Pasir is purposely twisting, or he is ignorant. This 7.75% loan is for 60 years' repayment. If you ask any CPF depositor, "Can we use your money to lend it to the HDB, and you get it back 60 years later?" And see what is his answer.”
“Sir, I would like to answer the two points. On this levy, the Government will review the levy. On the question of architects staying in HDB flats, the Member for Alexandra will be quite surprised if I tell him that some architects were, in fact, born in HDB flats (former S.I.T. flats) and are living in HDB flats. They were educated in our schools and, because of Singapore's very open society, they attended University, got a degree and become architects, and work for HDB. A lot of them, in fact, still have relations, parents, in HDB estates, and they do visit HDB estates regularly. In fact, they always comment that their house is much worse than what HDB is at present providing.”
“In fact, at present the Area Offices are processing the transfer but it has to be referred to the head office because the HDB rule is to observe the first-come first-served policy. It is the head office which has centralized information. The individual Area Office does not have centralized information and our computer system has not yet been extended to the Area Offices. So they do not have the updated information as the head office. They have to come back to the head office.”