Yeo Cheow Tong
Singapore
“Mdm Ho Geok Choo asked the Minister for Health in light of the recent report on fungal corneal infections (a) whether those who contracted the contact lens related fungal corneal infections will suffer permanent damage to their eyes; and (b) how long will his Ministry take to conclude its investigations into the causes of these contact le…”
“My Ministry performs a regulatory role and what we do is that we try to ensure that we have a conducive regulatory environment for the growth of this industry in Singapore. Let me tell him what we are doing in some areas.”
“Sir, on her two questions, whether we are satisfied that the school buses are collecting fares during the school holidays, as I mentioned just now, the school bus service is a contractual service between the parents and the service provider. It is therefore up to them to work out the terms and to abide by the terms.”
“Sir, on the first question, whether there is any abuse by owners of buses while using the 50% rebate, the answer is no, because LTA monitors very closely.”
“Sir, I have to repeat my answer. We are not responsible for regulating school buses and therefore will not be involved. SCHOOL BUSES (Installation of seat belts) 5. Assoc. Prof.”
“Ong Soh Khim asked the Minister for Community Development, Youth and Sports (a) if his Ministry will increase the cap of $10,000 per disabled person over their lifetime for the Assistive Technology Fund scheme; and (b) if not, whether there will be a flexibility to adjust the funding cap for this scheme based on the applicant's need, as j…”
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“I think the financial analysts will tell us that the rate of return for SBS in 2001 is fairly healthy, but the rate of return for the combined SMRT/TIBS is on the low to very low side. In actual fact, the performance of the two bus companies would have been even lower, if not for two Government measures that we implemented in 1998. Let me go into these two measures. Road Tax Reduction The first is the vehicle tax rationalisation exercise. This was part of the Government's cost-cutting exercise. But it was also to offset the impact of the ERP on public buses. The road tax for buses was reduced from $5,500 to $1,600 for the single-decked buses, and to $2,000 for the double-decker buses. Arising from this, the two bus companies enjoyed a combined savings of some $13 million a year. SBS alone accounted for about $10 million of the savings. Extension of Bus Lifespan Sir, the second important measure was the extension of the statutory lifespan of buses from 12 to 15 years. This was again done in mid-1998. This means that for three years, from 1998 to mid-2001, the bus companies had a double benefit. First, they could continue using buses which would otherwise have to be disposed of. These buses are fully depreciated, ie, they could use assets which, in effect, were already free. Second, they were able to save the money which they would otherwise have to use to buy the new replacement buses. This means that they saved on the depreciation, plus they were able to earn interest on the money which they did not have to spend. To show Members the large amount of money involved, SBS spends about $80 million a year to replace its fleet of buses.”
“The question we need to ask is: are the companies indeed profiteering? Are the profits excessive or are they reasonable? And should we squeeze them until they are losing money and are on the verge of being commercially not viable before we allow them an increase? How would this enable them to provide a satisfactory level of service to the commuters? How would this serve the long-term interests of the commuters? Sir, let me again give Members some facts. Members will recall that the operating costs of the PTOs went up by 6.9% in 2001, while fares only went up by 1% last year. Consequently, the profit margins of the operators dropped significantly last year. The after tax profits of SBS Transit dropped from $51 million in 2000, to $40 million in 2001. TIBS fared badly, dropping from $8.4 million in 2000, to only $2.7 million last year. Similarly, SMRT, which did not enjoy a fare increase last year, saw its profits drop by almost half, from $111 million to $67 million last year. Yes, they are still profitable and are still making millions. ROTA But profits must be measured relative to the level of the investments needed. The figures are huge. SBS has total assets of over $500 million; TIBS has over $270 million; and SMRT, $1.4 billion, ie, $1,400 million worth of assets. Yesterday, we had a long lecture also from Mr Tan Soo Khoon on the return on equity (ROE) of SBS. ROE is really not a good measure of how effectively a company is using its assets. The better measurement is ROTA, or Return on Total Assets. ROTA is calculated by dividing the earnings before interest payments by their total assets. Of the three operators, SBS had the best ROTA, of 8.6 % last year. In comparison, TIBS had 2.9% ROTA, and SMRT, 4.8%.”
“Productivity Improvements Sir, some Members have also pointed out that the PTOs should try to improve productivity rather than rely on fare revisions. After all, that is the common thing that every company does. When it is faced with a downturn, it will look for better ways to improve productivity. As Minister Mah and SMS Khaw had explained, we do expect the PTOs to do more to improve productivity, but we must also be realistic. The easy improvements have all been made: one-man operation in the earlier years; next, the bus companies went on to larger capacity buses. That helped to improve the productivity of the bus drivers. But there is a limit to how much bigger the buses can go. We have got double-decker; we cannot go triple-decker. So, there is a limit now to the easy increases in productivity. And the bus has only one driver. We cannot cut it down to half. Maybe one of these days, in the far future, we may have driverless buses, just like we have driverless trains. But that day is going to be very far in the future for us to even think about. So productivity is going to be a difficult challenge, but we will nonetheless push the bus companies to strive for it. Profitability Sir, another hot topic inside and outside the House, in fact, a very hot topic, is the profitability of the operators. Mr Iswaran had given us a good lecture, and I hope Members have heard clearly what he had said. Yes, the operators are profitable. Yes, they are making millions of dollars. Should the simple conclusion then be that since they are making plenty of money, they should not be allowed to increase fares? Some Members even go further, and argue that the PTOs are providing a public service and, therefore, they should not be profit-making.”
“But I think Mr Ong Ah Heng's views should be well listened to, because he represents the workers and he knows what life is like for them. We must be fair to the transport workers. They have taken a wage restraint last year, but we cannot continue to deprive them of what other workers are enjoying. Otherwise, good workers will not want to work for the transport companies and, in the end, commuters will be worse off. And, as we have heard from Mr Ong Ah Heng and Mr Ng Ser Miang, the bus companies already have huge difficulties recruiting bus drivers. Today, even in the midst of the recovery, when we hear many people are looking for jobs, there are still 200 bus driver's jobs going a-begging. Service Improvements Sir, another key component of the cost increase is service improvements. The key service improvements are those that are made to meet requests from commuters for more frequent services, and new bus services to serve new HDB towns. Unfortunately, service improvements do not come cheap. As a guide, it costs the operators $500 per day to run an additional bus, and this amounts to $200,000 a year. So, each time we ask for the frequency to be increased, to add in more buses, each bus will cost the company $200,000 a year. If that additional bus leads to a higher ridership, that is all right. But, unfortunately, it is usually the same pool of people who take that service. So, the additional frequency may not lead to a comparable increase in revenue. What about the introduction of a new bus service? Sir, the PTC tells me that it costs $3.5 million a year for the bus companies to introduce a new service. Over the last two years, the PTOs had a net increase of seven new services.”
“The PTC has, therefore, looked after the interests of the commuters very well by not allowing the PTOs to pass through to the commuters much of the impact of the cost increases. Wage Costs Sir, Members have asked - surely wage costs would have gone down? Based on the figures I have quoted, what has led to the increase in the costs? The PTC has explained that the main cost factors were, indeed, wage costs and service improvements. Public transport is very labour intensive, with manpower costs making up about half of the PTOs' total operating costs. In the year 2000, average wage costs for transport workers went up by 8.3%, partly because of the 2% CPF restoration. Mr Tan Soo Khoon had asked whether the PTOs exercised wage restraint last year, just like SIA. I am very happy to inform the House that, last year, the transport companies, workers and executives did indeed exercise wage restraint. As a result, wages last year went down by 3.4%. But because of the 4% CPF contribution restoration, this pushed the wage costs up by 0.6% for the bus companies. That meant that over the two-year period, wage costs for the PTOs went up about 9%. This is despite the downturn. Sir, some Members may be surprised by this. Let me now quote to Members the figures from the Ministry of Manpower. MOM's data shows that wage increases in Singapore averaged 6.6% in 2000, and 1.1% last year. Total increase for the two years was 7.7%. And if we include the 6% CPF restoration, total wages for the employers would have gone up by about 13.7%. Therefore, the PTOs, transport workers and executives have actually exercised wage restraint by holding the increase in wage costs to only 9%, well below the national average. Sir, we have heard from Mr Ong Ah Heng. We have also heard from Mr Ng Ser Miang.”
“They also do take into consideration the state of the economy, how is it impacting on the people, especially the commuters who form the lower level of the social economic group, and they try to make sure that the interests of both are safeguarded. By looking at the actual facts, the PTC is then able to make a decision based on the performance of the previous year, and not on projections for the current year. Because, if the PTC were to base the fare increase for this year on what the public transport operators have projected as the increase in cost for this year, their figures will be very hard to answer for or justify. So PTC has taken the right approach. Let us scrutinise the cost increase of the previous year in order to consider whether or not to allow an increase this year. Sir, the PTC found that, in 2001, the operating costs of the operators had increased by 6.9% on average. The recent fare revision, as Members know, will increase the revenues of the bus companies by 2.3%. The revision will, therefore, only partially offset the increase in operating costs. I must also inform Members that costs had also gone up significantly in year 2000 by 8.5%. But because we were in recession last year, PTC decided not to allow an across-the-board increase to cater for that large increase in costs. It only allowed feeder bus services to increase the feeder fares by 10 cents. And this resulted in a general increase of 1% in the bus companies' revenues. Sir, this means that over the past two years, despite the economic downturn, costs for the transport operators had gone up by over 15%. But with this year's increase of 2.3%, total fares for the two years together would have gone up a total of only 3.3%.”
“Sir, thank you for allowing me to join in the debate on the transport fare revision. Many Members have spoken on the original Motion and the amendment as well. They spoke with deep feelings, reflecting the unhappiness amongst many Singaporeans over the recent fare revision. I fully understand and empathise with the sentiments expressed by the Members and by the general public as well. Like the other Members here, I too had to face unhappy constituents and community leaders. Sir, it is good to have the chance to thoroughly discuss this issue in the House. For Members to not voice the sentiments of the ground, especially when the unhappiness appears to be so widespread, would undermine our credibility as representatives of the people. The Members have raised many valid points and questions. But there were also many misconceptions. Some MPs, like Mr Ong Ah Heng and Mr Iswaran, have eloquently helped to enlighten the House, and I commend them. Sir, I would now like to present some of the pertinent facts and further clarify the various issues. By having the full facts and picture, we can then discuss the public transport policies in a rational and logical manner and arrive at the right conclusion. Sir, when I got the Motion, I thought I had better prepare myself and asked PTC for the full details on how they came to the decision. I shall start with the question on the need for the fare revision. Is it justified, and why now, and not six months' time, or even a year later, as some MPs have suggested? Let me first inform Members that what I have ascertained is that PTC does closely scrutinise the financial performance and the increase in operating costs of the public transport operators in the preceding year, when considering the fare increases for the current year.”
“Anyone who has been in this House and who has heard him cannot be under any other different impression.”
“This is precisely what I have just said. The DPM did not give any impression at all to the House that there would be no increase this year. I think Mr Tan, in delivering his remarks, has inadvertently or deliberately created the impression that the DPM had, in fact, misled the House. There is no such thing. The record is very clear. Mr Tan Soo Khoon: Sir, in my speech, if you could look at the verbatim reports, I do not think that I have given the impression that DPM was deliberately setting out to mislead the House.”
“Sir, I would like to raise a point of clarification based on what Mr Tan Soo Khoon had said just now. He quoted DPM's speech during the recent Budget debate, and gave the impression that PTC would not be approving any bus fare increase this year. Sir, far from it. DPM was, in fact, very clear about this. Let me quote what DPM said. He said: "The Public Transport Council (PTC) is currently evaluating proposals from the transport operators to revise fares. PTC is only considering revisions to catch up with operating and maintenance cost increases over the past year." He went on to say: "The public transport operators have raised with the PTC the issue of the GST increase next year. After considering their views, with the likely increase in GST to 5% and the proposed cut in the corporate income tax, the PTC has decided that there is no need to raise fares next year as a result of the GST increase. The transport operators have accepted this decision." Sir, I hope that Mr Tan would get his quotes correct. I would reply to his other points later on.”
“Heavy-duty ceramic tiles were used for the architectural finish of the exterior of the MRT stations at Redhill, Queensway, Commonwealth, Buona Vista and Clementi. This was an acceptable method of external finishing when the stations were built more than 14 years ago. However, over the past 10 years and as a result of normal wear and tear, some of the tiles have been falling off. To prevent any risk of falling tiles causing injury to commuters, SMRT erected safety nettings. It also carried out a study to determine the extent of the problem and reviewed the possible solutions. The study concluded that the most cost-effective solution is to completely remove the tiles and replace them with a coating of cement and paint. SMRT estimated that this will cost about $900,000. Works have been in progress since mid-2001. SMRT believes that the painted walls will be easier and no more expensive to maintain than the ceramic tiles over the long term. WORKFORCE POPULATION OF SINGAPORE 2001 4. Mr Steve Chia Kiah Hong asked the Minister for Manpower if he will provide statistics of the population for the year 2001 with breakdown figures of citizens and permanent residents, blue-and-white collar employees, the unemployed, the home-makers, the retirees and those not working such as students and the young.”
“SCAE also provides consultancy services to airports in the Asia-Pacific region such as airports in the Philippines, Fiji, India and China. Earlier this month, it signed an MOU with Hangzhou Airport in China to provide consultancy services. FREE SATURDAY PARKING AT HDB ESTATES 27. Dr Teo Ho Pin asked the Minister for National Development whether the HDB will consider implementing free parking on Saturdays at HDB estates so as to encourage family members and friends to visit one another and to strengthen bonds.”
“The Airport Logistics Park of Singapore, or "ALPS" for short, is being developed by CAAS and JTC within Changi Airport's Free Trade Zone (FTZ). ALPS was launched in November 2000 to allow Third Party Logistics service providers (or 3PLs) to export and distribute goods from local and regional manufacturers to the Asia-Pacific market in a cost-effective and timely manner. By siting their operations at ALPS, 3PLs can customise their operations to achieve rapid turnaround time while enjoying an exemption from various Government procedures for goods that do not leave the FTZ. CAAS is responsible for the land and infrastructure works for ALPS. These works will be completed by January 2003. One company has started work on its own building which is expected to be completed by end of this year. Another MNC logistics company has also decided to build its facilities in ALPS. EDB is discussing with several others. With the gradual upturn of the global economy, CAAS, EDB and JTC are stepping up their marketing efforts to attract key logistics players to set up operations in ALPS. When fully operational, ALPS will enhance Singapore's position as a leading transport and logistics hub in the Asia-Pacific region. Mr Gan also asked about CAAS' overseas investments. CAAS is investing in overseas airports as part of a business strategy to diversify its revenue streams. Through its subsidiary, Singapore Changi Airport Enterprise (or "SCAE"), CAAS has a 50% equity stake in Alterra Partners, a London-based airport investment company with Bechtel as the other shareholder. Alterra presently operates airports in London, Costa Rica and Lima. It is actively pursuing airport development and operation projects in Europe, Latin America and Asia including China and India.”
“But more bus resources with lower ridership per bus must translate into a higher fare. It cannot be having fewer passengers and being able to charge a low fare unless the fares are being subsidised. I do not think private bus companies are in the business of subsidising ridership. But having said that, let me inform Members that we are open to the idea of introducing competition in the bus industry. As Mr Ong has mentioned, one possibility is to allow private bus operators to operate a feeder service on a pilot basis. Unlike trunk routes, feeder services are confined to a certain geographical area and therefore it is easier to monitor them and to see how they are performing and to get feedback from the commuters. I would be happy to invite Members who are not happy with their current feeder bus service, if they are willing, to volunteer his or her estate for this pilot project. Just let me know and I will ask PTC to explore this option with him or her. Perhaps, Mr Ong may be the first guinea pig for this project. But please make sure that our GRC members agree with you. Sir, I think I have replied to all the questions. I will now ask SMS Khaw to reply to the questions on the trains.”
“Let me now move on to Mr Ong Kian Min's points on the feeder bus service. Sir, he proposed that we review the possibility of introducing competition into the feeder bus service because quite often he gets complaints from residents that the existing bus companies are unable to meet their expectations. First, let me explain to Members a little bit about the public bus framework. The current bus industry framework allows the basic bus operators, ie, SBS Transit and TIBS, to achieve economies of scale. This enables them to maintain affordable fares, while complying with the bus service standards set by the PTC. The service standards set by PTC include quality of buses, service frequency and the maximum number of transfers allowed on a particular trip. More importantly, PTC imposes universal service obligations on the operators. This means that they have to provide a comprehensive network of bus services, including regular bus services, to the less populated areas, even though these routes may not be profitable. The bus operators therefore have to balance between the profitable areas and routes that are not profitable. People living in sparsely populated areas, or working in newly developed areas, are therefore not penalised by having to pay higher fares, or to be deprived of a public bus service. But that does not mean that we do not see a role for private bus operators, and we do not have private bus operators operating in certain niche areas and on the Scheme B services. Sir, bus routing is a very complicated business. There is a certain amount of ridership and the ridership can be best met by a certain deployment of bus resources. If you deploy more bus resources, yes, the residents will get a better service.”
“They use it as a form of leisure and they ride it during the cooler hours, rather than at noon time when they have to go out to get their lunch. He has also asked us to persuade bus companies to use low capacity buses for private estates. Private estates are, in fact, free to set up their own cooperative and hire a bus to run a shuttle service from the estate to the key amenities. In fact, some condominiums are already doing that. They hire a shuttle bus service that shuttles the residents to either the shopping centres or to the MRT station. So they are free to do that. 4.15 pm He also asked us to expand the Park-and-Ride location. Sir, we do have the Park-and-Ride locations. The feedback we have is that they are still not well used. If there is additional demand, we will definitely be very happy to look into that. So if Mr Chiam has got suggestions as to which Park-and-Ride carpark is overly utilised, do let us know, we will definitely look into it. Sir, Mr Yatiman talked about the impact on taxi drivers and that taxi drivers will not benefit and, in fact, they have to pay more from the increased ERP. It is true that if there are more ERP gantries, and if the ERP rates still go up because of the increased congestion, the taxi drivers may have to incur more expenditure on the ERP charges. But this is because of the driving patterns of the taxi drivers. Today, taxi drivers tend to cruise around even when they are empty looking for passengers. Increasingly, the taxi companies and taxi drivers will have to review their driving habits and driving patterns. They may have to rely more on the call service and wait for the passenger to call them, rather than cruise around and pay for the increased ERP charges.”
“The primary interest is to make sure that, firstly, we have an efficient system for transporting people around Singapore. Private cars is one element of that system. But the public transport system is an even more important element of that policy. Having allowed the people to meet their aspirations to own cars, how do we make sure that our roads do not become giant parking lots that we see in many countries? The only way is to have congestion control which, in our case, is ERP. The ERP has worked and we will continue to have to rely on the ERP. Sir, he has made three suggestions. First, he brought up the issue of people in Amsterdam using bicycles. I have been to Amsterdam before and if I were living in a climate as pleasant as Amsterdam, I will be very happy to ride a bicycle to work too. But, unfortunately, the reality is that Singapore is too hot a place to be riding bicycles. Yes, people do ride bicycles for leisure but I think few people would want to ride to work and arrive at work sweating away. He has asked for bicycle lanes to be built in the HDB estates. Sir, already we are so land short. We are already struggling to find spaces for parks, recreation usage, and residential usage. It would be very difficult for us to put aside land for bicycle lanes. In any case, in the HDB estates, during the day time hours, or during most of the day, other than the peak hours in the morning and evening, the roads are actually quite sparsely used. Therefore, it is very safe for people to be riding bicycles. In fact, many of my senior citizens do ride bicycles around, and they have never complained to me about the dangers of riding bicycles around. But they do not use it as a form of transport, even though they have bicycles.”
“Also, the 12-km Kallang/Paya Lebar Expressway (KPE), which is a very important project, will be completed in 2007. This project, when completed, will also help to relieve a lot of the traffic from the CTE. All these on-going projects will cost almost $2 billion. In addition, LTA will embark on several road upgrading and development projects worth $570 million over the next few years. Sir, I must also alert MPs that there is a limit to what we can do, because we have a limited amount of land in Singapore. Already, roads take up 12% of our total land area, and this is the same amount of land used for residential purposes. Going forward, we will have to increasingly rely on ERP to manage road congestion and ensure that our limited roads are used optimally. But we all need to travel for one reason or another. The Government will therefore ensure that commuters have an efficient alternative to cars. Our priority, therefore, is to continue to expand the rail network, as this will be the backbone of our public transport system. SMS Khaw Boon Wan will shortly update Members on the development of the rail network. Sir, let me move on now to Mr Chiam's remarks. Mr Chiam went on a very convoluted argument about car ownership and revenues. With our limited land, I think even Mr Chiam will agree, we have no choice but to control car ownership. If he is able to give us a better alternative on how to control car ownership without imposing a cost on the owners of cars, we will be very happy to review his suggestion. Sir, the system we have for controlling of car ownership is not a revenue-generating system. Yes, we do generate revenue from that, but that is not the primary interest.”
“That would help to shift traffic to those roads that are not so congested. Some Members have expressed concern about the impact on existing car owners when ERP is expanded, ie, when we shift more to usage restraint, the existing car owners have not benefited from the lower upfront costs, and therefore they have not benefited from the change. It is true that these owners did not benefit from the lower ownership costs. But they will still benefit when the road tax for all cars is reduced by about 20% from September this year. Also, as Members will recall, when ERP was introduced in 1998, the Government had announced that road tax rebates would be given for a period of five years. The final instalment of the 5-year rebate package is due in September this year. I am happy to inform Members that we will be giving a road tax rebate of $100 per passenger car unit (PCU) this year. This rebate is the same as last year's and together with the coming road tax reduction, this will help motorists adjust to the progressive shift to the usage restraint measures. Mr Ong asked about the PARF for cars registered before May 2002. I am happy to inform him that cars bought with pre-May 2002 COEs will enjoy the PARF rebate calculated based on the OMV. This is only fair as they bought the COEs under the old ARF and PARF rates. Mr Yeo and Mr Yatiman asked about our plans for upgrading the road network in view of the growing vehicle population. There are numerous road projects underway today. These projects include the Braddell Road/Bishan Road Interchange, PIE/Adam Road Interchange, upgrading of Upper Bukit Timah Road, the Telok Blangah Semi Expressway, and the CTE/Braddell Road Interchange, which will also help to relieve the traffic on the CTE when all these are completed.”
“We have a total vehicle population of about 700,000 vehicles on the roads. So the additional 5,000 that we are adding will only add 0.7% to our overall population, and I do not think this will increase the congestion very much. Some of the MPs have asked about the expansion of the ERP system. With regard to the expansion of ERP coverage, LTA had announced in May 1999 the Phase 2 expansion of the ERP system. This will form a second ERP cordon along the outer ring roads. Existing car owners have therefore been given ample notice that the ERP coverage will be expanded in due course. A total of seven gantries were implemented under phase 2A in September 1999. Gantries at the remaining 10-12 locations will be erected as and when traffic conditions warrant it, ie, it is a congestion control and we will only implement ERP at those spots when the congestion on those spots warrants it. Mr Yatiman mentioned that there are heavy traffic jams at certain roads - and I think Mr Chiam said the same thing - at CTE and Toa Payoh PIE interchange. Based on our studies where there are ERP gantries, the traffic along those roads may be heavy, but they are still within the optimal speed range established by LTA for the efficient use of those roads, ie, they are above the speed of 45 kph. I think where the roads are heavily congested now are really in the evenings. CTE is almost like a parking lot in some stretches and this is because we do not have ERP during those evenings. I would like to inform Members that my Ministry and LTA are now looking seriously at how to relieve the congestion on those roads. Where there is no scope for us to further expand those roads, one alternative is to introduce ERP there in the evening hours as well.”
“Sir, Mr Yeo Guat Kwang commented on the White Paper that much has been said but little done. I seek to disagree with him. In fact, much has been done. And more has been done than what has been set out in the White Paper. In terms of the rail network, we expect to have a much wider rail network than has been laid down in the White Paper. It is going to be more than two-and-a-half times longer than what was set out in the White Paper. In terms of road building, we are, in fact, ahead of what was stated in the White Paper. So, actually it is little said, much done. Sir, let me touch on the key point which most of the Members have spoken about, which is on the shift in the car policy towards more usage restraint measures, rather than on ownership cost. Ownership cost affects all car owners, regardless of how much they drive and how much they actually add to the road congestion. Usage restraint measures are more focused, more efficient and more equitable. Car owners pay according to what they use and how much they add to the road congestion. ERP has been found to be able to divert car traffic from the congested roads during peak period and shift the traffic to the less busy period. So the shift to the usage restraint measures will therefore bring about a more effective utilisation of our limited roads. Sir, Mr Chay has asked that we be aware of the impact of having more cars on the roads because this will then increase the usage cost. We are indeed aware of that, which is why we are introducing the shift gradually so that the car population will still be kept under control and not be allowed to expand significantly. The 5,000 COEs that we are adding should be seen in the context of the overall vehicle population.”
“We will definitely encourage more of such systems to be developed, so that they can help our companies better deploy their assets.”
“Similarly, passengers flying to Jakarta can choose from 13 airlines, with ticket prices ranging from $580 at the high end, to as low as only $160. So, tremendous choices are available. And Singaporeans, especially Singaporean businessmen who are looking to cut costs, should actually shop wisely. They will be rewarded if they do shop around. Sir, my Ministry will continue to work with CAAS to attract as many airlines as possible to Changi, so that Singaporeans can have a wider range of choices and more competitive prices. Sir, Mr Chay touched on the logistics area. He mentioned the existence of trucking depots or dry depots in Europe, where trucks can then exchange their load in order not to have to return empty. This concept is very, very applicable to countries with large land mass, because then the distances are huge, and that is why we see such dry ports or land depots in the USA, Europe and even in China. They are sprouting up in many parts of China. The potential for such "land hubs" in Singapore is not that good, because we are too compact. Nevertheless, there is merit in helping industry players better deploy their assets as best as possible, within the company and between companies, as this will then help to ensure better asset utilisation and help to lower costs. I understand that, at present, there are two Vehicle Scheduling and Tracking Systems (VSTS) in place to help companies better optimise their truck usage. These are provided by Transnet and Sunray, and these systems are linked to PSA's IT systems as well. So, not only can they use it for their own usage, but they can link it to PSA, so that, for cargo that is going through PSA, it helps to make the data exchange seamless and electronic.”
“CAAS also has several schemes that enable new airlines, or airlines that start new services, to enjoy heavy rebates on landing fees and grants for several years. Since their introduction in 1998, about $7 million has been awarded under these schemes to 18 airlines. I can assure Members that CAAS will continue to review these incentive programmes and partnership programmes with the airlines, and we will tailor them further to suit the needs of the individual airlines and anchor them here in Singapore. Sir, several Members have also expressed concerns about the pricing policy of SIA and how it is forcing passengers from Singapore to fly elsewhere to obtain better deals. As I have told the House before, CAAS does not intervene in the pricing policies of SIA or any other airline that operates through Singapore. Airlines are free to set their own airfares. But what is important to note is that the aviation sector in Singapore is very open and very competitive, with multiple airlines competing on many of the routes. Air travellers can, therefore, choose the airline that best suits their requirements in terms of service, price and flight times. Many airlines offer fares for direct flights to popular destinations that are, in fact, much, much lower than SIA's. With such attractive and competitive choices, there is really no need for Singaporeans to transfer at other airports, en route to their destinations. Let me give Members some examples. Let us say to Bangkok. There are 11 airlines that fly to Bangkok from Changi, and the price of an economy class return ticket can range from only $200 to as high as about $400. So, passengers have a full range to choose from.”
“When Terminal 3 (T3) opens at the end of 2006 or early 2007, we will have a state-of-the-art terminal that will increase Changi's capacity by about one-third. The other two existing terminals will not be neglected. Expansion works for T1 will be completed in September this year, and we will be investing some $240 million after that to improve T2, to make sure that all our facilities are really up to scratch and are at the forefront of service and technology. Sir, in building the new infrastructure, we are aware that we have to cater to the latest technologies that might come along and, therefore, works are underway to ensure that our runway and terminal facilities will be able to accommodate the new Airbus A380, which can carry 555 passengers, and which should be the largest passenger aircraft in the world. SIA and other airlines have ordered this aircraft and they will be flying this aircraft through Singapore and, therefore, we must be ready to accept this aircraft. Sir, Members have also mentioned the need for Changi to be cost-effective and cost competitive. We have, indeed, always been conscious about the need to provide value for money to our airlines and to our passengers. In fact, we do this without demands being placed on us. For example, CAAS extended the off-Budget measures, such as a 10% rebate on landing fees, 15% rebates on office and warehouse rentals, and a 15% rebate for concessionaires until the end of this year. The rebates cost CAAS about $17.4 million. But what is more important is that the rebates have brought Changi's landing fees close to 1981 levels, ie, what we were charging 20 years ago.”
“But, despite the competition, Changi Airport is still making good progress. Let me quote Members some figures. For the two months of March and April this year, passenger and cargo traffic at Changi Airport grew by 1.5% and 8.9% respectively, compared to a year ago. SIA's load factors are up by five percentage points in March and, what is more important, airlines are adding new or additional flights into Changi. For example, SIA will start new city links to Las Vegas and Chicago later this year. Qantas has started a new service to Rome through Singapore, while China Eastern Airlines has doubled its flights to Shanghai to 14 a week from seven a week. In the next few months, Changi will welcome Australian Airlines, which is the new subsidiary of Qantas, and it will be starting a new service to Cairns in Queensland. And Swiss International, the new airline that replaced Swissair, has also started operations from Changi to Zurich. Changi's air cargo network has also expanded, with CargoLux and Northwest starting links to Budapest, and to Cincinnati in the USA, respectively. These new city links and services are part of our never-ending efforts to improve Singapore's connectivity. Presently, 58 scheduled airlines serve Singapore, connecting us to 139 city links in 50 countries. This high connectivity is a key reason why 28 million passengers used Changi last year. But, while the prospects for the aviation sector are improving, we have to continue upgrading our facilities and improving our services, in order to keep ahead of the competition. So, what will we do? First, we will continue with our policy of enhancing our infrastructure to cater to the ever-increasing needs of airlines and passengers.”
“So, PSA's management cannot afford to divert its attention from the operations in Singapore. Sir, Mr Chay mentioned about the dedicated terminals, whether PSA will be prepared to look at other options, including the dedicated terminals. As I have mentioned, PSA is doing a complete review of its business strategy, and nothing should be discounted. It will be talking to all its customers, and it will be as responsive as possible in meeting the needs of the customers. Sir, let me conclude by saying that these are challenging times for our port. PSA is acutely aware of the ever-changing competitive landscape. I can assure Mr Chay and other Members of the House that PSA is not about to give up its position as the number one transhipment port in the world. It will, therefore, do all that is necessary to partner its shipping clients and help them to compete effectively and to grow. This, in turn, will enable PSA to continue growing and to remain as a top transhipment port in the world. Mr Tan Soo Khoon also asked about the Kra Canal. Sir, contrary to the newspaper reports, we have not been consulted or approached about investment in the Kra Canal, and we are, therefore, just learning from the newspaper reports what is going on in Thailand with regard to the canal. Sir, let me now move on to the remarks of the MPs on airport competition. What I have said about the port applies generally to airports as well. Inevitably, airports compete with one another, especially within the region. As Mr Ang has pointed out, countries such as Thailand and Malaysia have recognised the economic importance of a hub airport, and are investing heavily in this sector. The competition faced by Changi Airport in the years ahead can, therefore, only get more intense.”
“PSA is now reviewing all facets of its business strategy, with the aim of partnering and anchoring the customers here for the long term. Sir, PSA knows that many shipping companies are facing low profit margins. As such, the shipping lines would be shopping for lower prices. PSA understands this and is committed to remaining price competitive and remaining responsive to the needs of the customers. Mr Ong expressed worry about PSA's overseas operations and that these operations may divert management attention away from their operations in Singapore. He proposed that PSA splits into two companies, one to manage the Singapore operations, and one to manage the foreign investment. Sir, as Members are aware, PSA has been investing in ports abroad that have a high growth potential. It now has significant port operations in China, Europe, India and Brunei. The container volume handled abroad now totalled about 8 million TEUs a year, and is expected to grow rapidly. The overseas operations give PSA greater economies of scale. Even more important, they enable PSA to provide an international, rather than just local service to the shipping lines. And, this is important, because shipping lines operate internationally. So, PSA must be in a position to serve them in as many places as they go to. 3.00 pm These advantages and synergies would be lost if PSA were to be split into two companies, as Mr Ong has suggested. But I can assure Members that Singapore will remain PSA's largest and most important operation for many, many years to come. Because of the strategic value of the port to Singapore, not only will PSA management be fully focused on it, but also that of the Government leaders and, as we have shown here, the Members of the House as well.”
“Sir, first, let me thank all the Members who have spoken for their comments and views. Mr Chay, Mr Tan Soo Khoon, Mr Yatiman and Mr Ong Kian Min have expressed deep concerns about the competitiveness of our port and our ability to retain the shipping lines in Singapore. Sir, such concerns are understandable. As I informed the House on Monday, the port sector is a very competitive one, not just in our region, but all over the world. This is because new ports are being developed, and existing ones are always striving to upgrade their services and capabilities. For example, Hong Kong faces stiff competition from the new ports in Yantian, Shekou and Chiwan. In such a dynamic environment, with so many competing ports, we must expect shipping lines to adjust their ports of call from time to time. Sir, I want to assure Members that PSA is no stranger to competition. As Members know, PSA is largely a transhipment hub. Transhipment containers can be handled anywhere along the route of the container ships. They need not be transhipped here. Despite the competition, PSA continues to do well. Its container terminals handled 1.42 million TEUs (Twenty-foot Equivalent Units) in March 2002, the highest throughput in 17 months, and this is despite the loss of a major customer. Its container volume grew by 8.5% for the first quarter of this year. It has an extensive network of 250 shipping lines connecting to 600 ports in more than 100 countries around the world. All these shipping lines are PSA customers, because PSA offers them a highly cost-effective value-for-money service and a shipping connectivity that few ports can match. But as Members have noted, the competitive environment is constantly changing. PSA recognises this. It also recognises that it cannot afford to be complacent.”
“Sir, first, Changi Airport will continue to make sure that it runs a very tight ship, so that it can keep the cost down by being efficient. Secondly, Changi Airport keeps a very constant eye on the competition, to make sure that the rates that it charges are not out of line, and that airlines do find it profitable to continue calling at Changi Airport. GOVERNMENT INFRASTRUCTURE (Audit of use and sharing of surplus capacity) 4. Mrs Yu-Fu Yee Shoon asked the Deputy Prime Minister and Minister for Finance (a) whether there is a procedure to audit the use of Government infrastructure such as educational institutions, voluntary welfare centres, family service centres, community centres and sports centres to ensure their efficient utilisation and (b) whether a system can be put in place for voluntary welfare organizations and grassroots and civic organisations, such as Community Development Councils, Citizens Consultative Committees, Community Club/Centre Management Committees and Residents' Committees to share any surplus capacity.”
“Particularly noteworthy is the Eagle Award conferred on Changi Airport by the International Air Transport Association last year, as a token of the airlines' appreciation for the excellent service extended to them by Changi Airport. If we continue to remain relevant to the airlines and the passengers and alive to the competition, we will be able to keep Changi's hub status in the region for the long term.”
“Sir, competition to Changi as a regional air hub is not new. Many new airports have opened in the region, offering new and larger capacity; more are being planned. In part, this is due to the rapid expansion of the air passenger and air cargo market as Asian economies grow. The Asian financial crisis and September 11 have temporarily disrupted the growth, but the long-term trend is positive. As a result, the competition amongst airports will continue to intensify. To preserve our position as an air hub, we will continue to focus on three main areas. First, strengthening our position as a regional business and tourism hub. This ensures that there is high passenger traffic originating from and coming into Singapore. A strong economy also translates into large numbers of Singaporeans who can afford to travel abroad for business or on holiday. Second, enhancing our connectivity. Fifty eight scheduled airlines now serve Singapore, connecting us with 50 countries and 139 cities. This huge network of air links provides the excellent connectivity that makes Singapore an important air hub. Passengers can fly into Singapore and catch a convenient connecting flight to his next destination. Third, providing the highest standards of airport service. We take great pains to ensure that Changi Airport is well designed, equipped and managed, so that the airlines and air passengers who use Changi Airport find their Changi experience a memorable one. As a result of all these efforts, Changi Airport has been rated highly by passengers, airlines, shippers and freight forwarders.”
“Sir, whilst Maersk has shifted its hub to another port, I must inform the House that Maersk is still a substantial customer at PSA. It has retained some of the international routes through PSA, and it is sending a large number of containers through PSA port every month. AIR HUB 3. Mr Andy Gan Lai Chiang asked the Minister for Transport with growing competition from other countries setting in, what are the plans to keep Singapore an important air hub over the next 10 years.”
“Sir, PSA has had a very competitive regime of rates. As you know, the marketplace is a very dynamic one. Different ports offer different rates, different benefits. And PSA has always strived to make sure that it is able to keep ahead of the competition. In the case of the two lines that are leaving to hub elsewhere - one of which has already left - they were offered terms which they found difficult to turn down. PSA is reviewing its strategy now. As I have mentioned just now, primarily, it has to be price competitive. But price is not the end of the story, because what shipping lines look for are other services. It is the range of services that can be provided because, at the end of the day, they are looking at the total value chain that the port can give. A port can give very low rates. In fact, there are many ports that give rates that are far, far below what PSA is offering. But, because of inefficiencies and other problems, the total cost incurred by the shipping line to call at those ports is actually much higher than what it would cost to call at PSA. So it is a total equation that has to be taken into consideration. PSA is reviewing this total equation to make sure that it is still the most cost effective port to call at. As the Prime Minister has mentioned, we would definitely consider the other options as well, such as offering dedicated terminals and offering shareholdings in PSA by the shipping lines. All these options are being actively explored at the present moment.”
“It is committed to remaining customer-oriented and price-competitive in order to maintain and grow its position as the world's number one transhipment port. PSA will also continue to innovate and add value to its services through the adoption of new technology and processes. It will share the savings from productivity improvements with its clients. This win-win approach will help entrench PSA's long term position as a hub port. The Government, through agencies such as MPA, IE Singapore, EDB and MAS, will also continue to grow the maritime services sector. These activities, like ship management, ship financing, insurance and other specialised services, provide high value-add to the economy. In this regard, I am pleased to announce that MPA is setting up a $80 million fund to help speed up the development of the maritime sector. One key focus of the fund will be the development of the specialist knowledge and expertise needed by the sector. Details of this fund and how the shipping community can benefit from it will be released by MPA shortly. The fund and its programmes will complement PSA's efforts, and ensure that Singapore continues to grow as a hub port, as well as an International Maritime Centre.”
“Mr Speaker, Sir, first, let me assure the House that PSA has been a competitive port operator, and that it is committed to remaining so for the long term. Despite the decision of a major customer, Maersk, to hub elsewhere, PSA's container throughput for the first four months of this year went up 8.6% compared with last year's figures. As a reflection of its capabilities, PSA has been consistently voted the best container terminal operator in Asia for 13 years. More than 250 shipping lines call at the port, providing PSA with superb connectivity. However, shipping is a dynamic and increasingly competitive business. This is especially so for the transhipment business, as shipping lines need not call at Singapore to tranship their containers. Given the open and competitive nature of the shipping industry, it is not uncommon for new ports to woo shipping lines, and for the latter to seek out ports which offer better commercial terms. PSA expects that it will continue to grow its volumes in the coming years even as shipping lines readjust their ports of call. Sir, there are many positives in PSA's favour, including its high connectivity, high productivity, reliable services and a large critical base of over 15 million TEUs per annum. It took PSA many years to achieve this, and it will not lose its big lead overnight. Having said that, let me add that PSA is acutely aware that the competitive environment is constantly changing. Competition for the regional transhipment business has intensified, with countries in the region striving to develop their own hub ports. PSA is reviewing its strategy, and is taking steps to anchor its customers here for the long term.”
“The public transport operators grant concessionary travel to various groups of individuals, such as pre-school children, students and senior citizens, to help lower their cost of travelling. The privileges and types of concession offered differ from group to group. The public transport operators have a different concessionary travel scheme for students in tertiary institutions compared to those in schools. The polytechnics are considered as tertiary institutions. For tertiary students, the operators offer two types of concession schemes. The first is the monthly bus concession stamp, which allows the holder to take unlimited number of trips on buses for the month that he or she holds a valid stamp. The other is the monthly MRT concession ticket, which entitles the holder of a valid ticket to travel on the MRT and LRT systems up to 4 trips a day. Thus, a tertiary student who makes extensive use of the public transport system can cut down his or her transport expenditure by making use of the available concession schemes. Public transport operators are listed companies and need to earn a profit for their operations. At the urging of the public, they have granted concessions to various groups of people. However the more concessions that are granted, it would mean that other commuters would have to pay higher fares to make up the difference.”
“In land scarce Singapore, road space is limited and should be used for the efficient movement of people, goods and services. Thus far, we have only set aside dedicated lanes on our roads for public buses. This is because buses provide an efficient form of mass transportation. Bicycles, on the other hand, do not offer such efficiencies. We must also recognise that our hot and humid weather makes it unlikely for cycling to become a major means of transportation. Hence, to provide dedicated bicycle lanes on public roads will not be an efficient use of our limited road space. However, we do recognise that cycling is a good form of exercise, and in this regard, we have been providing cycling tracks and facilities for our residents. The Park Connector Network being developed by the National Parks Board is one such example. This is a network of jogging cum cycling tracks that links our major parks and nature sites. They also link urban and residential areas, providing convenient routes to places such as MRT stations, bus stops and markets. In addition, we have also provided bicycle stands at MRT stations to cater to commuters who want to cycle between their homes and transport nodes such as MRT stations. Town Councils may provide cycling tracks within their HDB estates. The Pasir Ris Town Council, for instance, is providing for cycling tracks within its estate. WRITTEN ANSWER TO QUESTION BUS AND MRT FARES FOR STUDENTS 1. Mr Chiam See Tong asked the Minister for Communications and Information Technology why is it that students from the polytechnics pay adult fares for rides on buses and on the MRT whereas those from junior colleges only pay student's concession rates, when both are of the same age and are students.”
“Sinnakaruppan asked the Minister for Communications and Information Technology (a) what are the reasons for the regular traffic jams along the Central Expressway between the Kampong Java tunnel and Ang Mo Kio Avenue 1 exit in the evening peak hours and between 9.30 pm and 11 pm; and (b) what measures his Ministry will take to address the problem, without resorting to evening electronic road pricing charges. 15. Mr Yeo Guat Kwang asked the Minister for Communications and Information Technology whether the Ministry has any plans to improve the traffic flow at the Central Expressway before 2006 when the Kallang/Paya Lebar Expressway is expected to be completed. The Senior Parliamentary Secretary to the Minister for Communications and Information Technology (Assoc. Prof. Yaacob Ibrahim) (for the Minister for Communications and Information Technology): Mr Speaker, Sir, may I have your permission to take Question Nos. 14 and 15 together?”
“We worked with the Japanese to conclude the "Tokyo Appeal and Model Action Plan" to strengthen counter measures and co-operation among coast guard agencies, maritime administrations and shipping community in combating the problem in the region. We also actively support the IMO's efforts in formulating cooperative arrangements among neighbouring countries to deal with piracy and sea robberies in the Malacca Straits and South China Sea region. We assisted the IMO in hosting and organising an anti-piracy seminar for the Asian region in February 1999 and a follow-up regional meeting in March 2001 aimed at promoting and enhancing regional cooperation. The shipping community has a part to play in the fight against piracy and armed robbery. MPA issues Port Marine Circulars to the shipping community advising them on measures to reduce the risk of piracy and sea robbery attacks. Such measures include an anti-attack plan that covers the need for enhanced surveillance, detection equipment, and radio and alarm procedures in the event of an attack. Piracy and hijacking are transnational crimes that require the coordinated efforts of governments and affected parties. A useful instrument that establishes the ground rules and legislative framework for co-operation among states is the Convention for the Suppression of Unlawful Act at Sea, or more commonly known as the Rome Convention, which the IMO has urged member states to accede to. Singapore has decided to accede to the Rome Convention. We will do so after the enactment of the necessary legislation. CENTRAL EXPRESSWAY (Improvement of traffic flow) 14. Mr R.”
“Sir, as a maritime nation and a responsible member of the international maritime community, Singapore takes a serious view against piracy and armed robbery against ships. As the major sea-lanes are our economic arteries, Singapore's trade will be affected if piracy causes ships to bypass our main shipping lanes. Piracy also poses serious threats to life at sea and could endanger navigational safety. As a result of the coordinated efforts of various Government agencies, we have been effective in addressing the problem of armed robberies within our waters. Since 1991, there has not been a single case of sea robbery in Singapore's waters. However, our territorial waters form only a small part of the main shipping lanes. Piracy incidents outside our waters could still pose a threat to our international trading activities. At the bilateral level, Singapore has been working closely with Indonesia to address the problem in the Singapore Straits that straddles both Singapore and Indonesian waters. The law enforcement agencies of both countries established the Indonesia-Singapore Coordinated Patrol (ISCP) to curb sea robbery in the Singapore Straits. The ISCP efforts include the regular exchange of information, effective operational channels of communication, as well as cross border pursuits. The ISCP was also held up at the 1999 International Maritime Organisation (IMO) Piracy Regional Seminar in Singapore as a possible model for other countries to emulate. Singapore also supports multilateral efforts to combat piracy and armed robbery against ships in the region.”
“Sir, we will have to await the outcome of the study. HOUSING AND DEVELOPMENT BOARD RETAILERS (Termination of leases and change of use of shops) 4. Dr Teo Ho Pin asked the Minister for National Development, for the period 1998-2000, (a) how many Housing and Development Board (HDB) retailers had (i) terminated their leases; (ii) requested for change of use of their shops and were approved; and (b) how does this change of use benefit residents.”
“Sir, as I stated in the House a fortnight ago, my Ministry and PTC are keeping an open mind on the issue of enhancing competition. We will examine whether we should allow private operators to operate new feeder services in new towns, and if so, under what circumstances and conditions. The study will take several months, and PTC will announce the outcome when the study is completed.”
“Mr Speaker, Sir, may I have your permission to take Question Nos. 2 and 3 together?”
“Dr Ker Sin Tze asked the Minister for Trade and Industry whether Singapore Power Limited has any plans to replace the overhead electrical cable, which is a common sight in many older private estates, with underground cables. BG George Yong-Boon Yeo: The use of overhead cables to distribute electricity to homes from the cable mains was discontinued since the late 1970s. However, a number of older private housing estates are still being served by these overhead cables. Singapore Power has no plans to replace these overhead cables as they are working well. Residents currently served by the overhead cables can switch to underground supply if they wish for the portion from the road into the house. They can arrange for their contractors to lay lead-in pipes and shift the electricity in-take points to the front of their houses. PowerGrid will then lay dedicated cables to these electricity in-take points and connect them to the underground grid outside the houses for a standard charge. When the estates or houses served by overhead cables are redeveloped, the developers or house owners will be required to switch from overhead cables to underground supply. WRITTEN ANSWERS TO QUESTIONS MINIMUM DEBTS FOR STATUTORY DEMAND 1. Mdm Claire Chiang See Ngoh asked the Minister for Law, in view of the upward trend in the numbers of insolvent small and medium enterprises being wound up and the forecast by the legal community of more to come in the next two years, whether his Ministry is prepared to review the statutory minimum in terms of debts owed by small and medium companies before they are deemed to be insolvent.”
“There are two Certification Authorities, or CAs, in Singapore. They are Netrust and ID.Safe. CAs issue digital certificates that allow parties involved in an e-commerce transaction to identify each other through the use of a digital signature. Industry feedback is that such validation is crucial for the growth of secure and trusted e-commerce. In Singapore, all CAs are subjected to a set of duties listed in the Electronic Transaction Act. They are also regulated by IDA, which is the Controller of CAs. CAs that are able to meet more stringent requirements, which include financial soundness, personnel integrity, and strict security controls and procedures, can also participate in a voluntary licensing scheme. Only CAs that meet the high integrity and security standards set up by IDA will be licensed. In return, they are able to instil greater consumer confidence. The use of digital signatures recently received a strong boost when both CAs in Singapore were awarded licences by IDA. Netrust's digital certificates are currently used to authenticate some Government transactions such as custom declarations, and transfer of CPF funds. Netrust's digital certificates are also used in "GeBiz", the Government one-stop centre for procurement activities. However, we only need to use digital certificates in Government e-services where strong proof of identification and non-repudiation is required. Many Government e-services do not require authentication of the user; and for e-services that do require user identity, a simple PIN or password requirement is often sufficient. ELECTRICAL CABLE 30.”
“Sir, the two bus companies are indeed private bus companies. As to why they are required to perform the USO, this is a fairly standard procedure in the management of public bus services. In any country, or in any city, it is not possible for all routes to be equally served unless they are priced properly. There are two ways of pricing them properly. One is to allow free market to rein, which means that in the areas with low ridership or low demand, the operators will then provide a service that is fairly infrequent or they should be pricing the service in order to recover cost, which means for the outlying areas, people have to pay a lot more for the bus services. The other way is to allow cross subsidy, ie, during the period when the demand is very high, the bus company is able to make money and that will then cover the higher cost during the low demand period, and which is why the USO is in fact a device to safeguard the interest of commuters wherever they are living. This way, they have access to a fairly uniform quality of service. In terms of grants to run unprofitable routes, it is best for the Government not to be involved in providing grants to actually cover the operating cost of those routes. It is better that the services be operated commercially and that the operators recover the operating cost from the commuters directly, rather than through a grant from the Government. 2.00 pm”
“Mr Deputy Speaker, Sir, with your permission, may I answer Question Nos. 15 to 19 together, as they are related?”
“At the end of the day, the capacity will still be very small because the two quay cranes would only give Jurong Port a capacity of 200,000 TEUs a year versus PSA's over 17 million TEUs capacity a year. Jurong Port, in effect, will only be a small complement to PSA and it will not be a true competitor for the container business.”
“The new Pasir Panjang Terminal, Phases I and II, will have only 26 berths and yet the projected cost for these 26 berths will come to about $7 billion. The investment requirements are going to be even greater in the years to come. And yet, for all the risks that it has to undertake to put in all the huge investments, PSA's return on assets last year was only 12.3% which I think most analysts would agree it is not unreasonable. Mr Yeo Guat Kwang asked about Jurong Port. He also talked about the competition from Tanjung Pelapas and other ports and what would the Government do to help ensure PSA survives so that the jobs we have would not be lost. The only way for PSA to continue doing well is for it to keep on enhancing productivity through the greater use of technology and through better training of the workers. I think that is what PSA has been doing all these years. I am sure that PSA will continue to do so because they have very good people there, who are very skilled. They have a lot of expertise and they have been able to compete very effectively against regional and international competition. What we will do is that we will continue to encourage PSA to explore all the possible technologies that can be applied to the operation of the port and make sure that they continue training their workers so that they remain competitive. In the case of Jurong Port, it has always been there. It is not a recent development. In fact, Jurong Port has been operating since 1965 and it competes with PSA for both the conventional bulk cargo as well as for a small number of container traffic. What Jurong Port has done recently is to purchase two container quay cranes in order to improve their productivity in handling the ships that bring in containers to Jurong Port.”