ESTIMATES OF EXPENDITURE - FOR FINANCIAL YEAR 1ST - APRIL, 1972, TO 31ST MARCH, 1973
Mr Speaker, Sir, I am obliged to the Member for Sembawang for his comments and sentiments for adequate provision for the Economic Services and, in particular, industrial development with which I must fully agree. He has asked for some details regarding the allocation for Economic Services. May I refer him to Appendix F of the Main Estimates of Revenue and Expenditure for 1972-73, in which a very detailed breakdown is given of expenditure by functional classification. It will be observed that all the departments and Ministries involved in providing economic services have been allocated adequate funds for their needs. As I have explained in the Budget Statement, the apparent reduction in the provision for Economic Services is due to the fact that the Telecommunications Department is to become a statutory authority and, therefore, no provision has been made for its recurrent expenditure which was allocated a sum of $19.4 million in the 1971-72 Estimates. If this is taken into account, it will be observed that the provision for Economic Services has, in fact, been increased from $107.5 million in 1971-72 to $113.14 million in 1972-73. I should also like to remind the Member that the amount we have entered in the Ordinary Estimates does not constitute all the budgetary provision for Economic Services, as provision is also made in the Development Estimates for expenditure on Economic Services. It should also be noted that with the increased allocation for Defence and Social Services, the proportionate share of the expenditure for Economic Services would tend to be marginally smaller, even when the actual quantum of funds provided has been increased. I can assure the Member that adequate funds will always be made available for departments providing economic services, and that there is no intention on the part of the Treasury to curtail their expenditure. The Member for Sembawang has also asked a question on the widening trade gap of $3,283.7 million in 1971 as compared with $2,778.0 million in 1970. This should give no cause for alarm. The preliminary figures for the 1971 balance of payments show that we have some $847.5 million in our favour compared with $416.5 million for 1970. This represents a 103 per cent increase in our reserves. Some reasons for the trends in the balance of payment figures had been given in the 1970 and 1971 Budget debates. If I may summarise, it should be appreciated that the widening trade gap is fairly common in a developing country, owing to the need to purchase large amounts of capital goods, particularly heavy machinery and transportation equipment. Of the trade gap of $3,283.7 million in 1971, import of machinery and transportation equipment alone accounted for $2,209.1 million. Even if we discount the $740.5 million for export of machinery and transportation equipment from Singapore, the retained imports still amounted to $1,568.0 million. The other point which has to be made is that the trade balance is not the only factor in the balance of payments. It is offset by increased invisible earnings from, firstly, entrepot trade services, including finance, banking, insurance and freight earnings. Secondly, unrecorded purchases by tourists and transportation personnel, such as ship and air crew. Thirdly, ship building, ship repairing, supplies to vessels, oil rigs and aircraft using Singapore as a base. Fourthly, the substantial under-coverage by the trade balance figures, which is indicated by the large balancing item of $3,045.2 million in our balance of payments balance sheet. Some redistribution of these balancing items could be attempted and would be largely made on the credit side of the Current Account, particularly on merchandise trade, also on Capital Account. This attempt to redistribute the balancing items has not been made since comprehensive data on these flows are not available to enable this to be done on a reliable basis. Nevertheless, I think it would be healthy to see our exports increase substantially. Singapore's total exports in 1971 registered a 13 per cent increase over the 1970 performance. In addition to the introduction of the Economic Expansion Incentives (Relief from Income Tax) Act, a new export promotion unit is being set up in the Trade Division in 1972-73 to undertake studies of export markets and to take full advantage of the preferential treatment offered by various developed countries to assist developing countries to increase exports of locally manufactured goods. On the Member's last comment on the matter of price increases, the Government is doing what it can to stabilise the prices of foodstuffs, especially basic necessities. Manufacturers, importers, and members of the distributive trade have been warned against taking undue advantage of any situation that presents itself to jack up prices. In this respect, I think officers of the Supplies Office are continually checking on prices of foodstuffs in all localities in Singapore. However, Singapore cannot remain totally immune to changes in supply and demand for food in the international scene. Nevertheless, the Government has to step in to help the consumers wherever possible. 3.00p.m. The retail price of locally refined sugar has remained stable at 39 cents a katty, or $550 a ton ex-factory, with duty, since February last year, despite the fact that world prices of raw sugar have shot up from œ49 or $360 per ton to over œ90 or $661.50 per ton currently -- I think it will be appreciated that there has been concern in other countries over the rise in the price of their sugar. To safeguard the consumers in Singapore, an export control is also placed on locally refined sugar. As far as wheat flour is concerned, the retail price of 25 cents per katty has remained stable since the beginning of 1971. Rice prices have also remained very firm. Since January last year, wholesale prices for the two Thai top-grade rice have declined from $33.50 and $26 per picul to its present price of $32 and $25 per picul respectively. The price of China top-grade rice has also dropped during the same period from $26.25 to the present value of $23.50 per picul. On condensed milk, the price of popular brands has remained at 60 cents for a 14-ounce tin since September last year. Over this period, the prices of raw materials have gone up considerably. Skimmed milk prices have increased on an average of $1,000 to $1,200 a ton, while butter fat prices have risen from $2,400 to $3,300 a ton. The Government has, therefore, done a fair amount of work in trying to stabilise the prices of basic commodities. However, I welcome the establishment last year by the private sector of the Consumers' Association of Singapore, which is very active in looking after the interests of consumers and is working closely with our Trade Division. Finally, I understand the National Trades Union Congress is presently studying the feasibility of setting up a Consumers' Co-operative, and that a pilot project will be launched in the near future. With the close co-operation of consumers, this project should prove successful. The Member for Anson, first of all, raised the point of the 13th monthly salary to be paid to pensioners. I think the intention of the scheme is really .a 13th month salary payment. So it is not a 13th month pension. In the circumstances, it does not fall within the scope of the 13th month salary scheme or the non-pensionable annual allowance. The Member also made some comment on the question of terms and conditions of service for civil servants and, particularly, for those who have just returned from overseas. I believe his comment is prompted by concern over the possible resignation of civil servants to join the private sector. The present practice, of course, is that the Public Service Commission appoints higher level personnel, including professional and technical personnel, to the permanent establishment so as to offer them a long-term career in the civil service. The Member suggested offering contracts. A small number of officers have been appointed on a temporary basis because they so prefer it. In other cases, it is because they are required for specific projects of a temporary nature only. However, such temporary officers with proven ability have been and will be offered permanent appointment if they wish. Those who were appointed initially on a temporary basis because their jobs were only temporary jobs can apply when permanent vacancies arise. The policy of the P.S.C, is to conduct frequent promotion exercises so that outstanding and promising officers will obtain accelerated promotion. Promotion in the professional services is now based on merit rather than for filling posts, so that where there are deserving officers, the P.S.C. will recommend their promotion even though there are insufficient established vacancies. As an added incentive to promising officers, the policy with regard to acting appointments is that these should also be made on merit and not on seniority. Also, pensioners are not normally re-employed unless there are exceptional reasons, such as acute shortage of experienced staff in a particular grade. In every case of re-employment of a pensioner, Government ensures that this is done without depriving the serving officers of their promotion prospects. With near-full employment, it may, in fact, become increasingly necessary to employ more pensioners who are still healthy in mind and body and who can contribute positively to the economy. I find it difficult, however, to accept the Member's suggestion to replace the present annual incremental practice with a three-year increment in all cases. The Member for Anson also made one comment with regard to locally-made products. I heartily agree that these products should be made more popular among our own consumers. I think the schemes which have been instituted by the Singapore Institute of Standards and Industrial Research should make it plain to all local consumers that our local products are just as good as those which are imported. I hope they will give their full support to the consumption of local products, instead of imported products.