Hansard, 1977-03-11

Under the provisions of clause 2(d) of Article 30 of the Constitution of Singapore. I have granted permission to the following Members to be or to remain absent from sittings of Parliament (or any Committee of Parliament to which they have been appointed) for the periods stated:- Mr Lim Guan Hoo (Bukit Merah),Parliamentary Secretary to the Minister for Home Affairs - from 2nd to 31st March, 1977. Mr Ng Yeow Chong (Mountbatten) -from 7th to 31st March, 1977. Mr Lim Kim San, D.U.T. (Cairnhill), Minister for National Development and Communications - from 9th to 17th March. 1977. Dr Lee Chiaw Meng (Farrer Park) - from 14th March to 1st April, 1977. Dr Chiang Hai Ding (Ulu Pandan) - from 21st March to 29th April, 1977. YEOH GHIM SENG Speaker, Parliament of Singapore

I have to inform hon. Members that, under the provisions of paragraphs (2) and (3) respectively of Standing Order No. 95, I have appointed Mr Hwang Soo Jin to be Chairman of the Public Accounts Committee and Mr J. F. Conceicao to be Chairman of the Estimates Committee.

asked the Minister for Foreign Affairs, in the light of recent revelations about Black Operations mounted against the Government from a number of countries, whether he will elaborate on the implications with regard to international relations governing our foreign policies; and if he will also indicate how these will affect the relations of Singapore with the countries concerned.

Mr Speaker, Sir, in reply to the last part of the question, may I say that relations between Singapore and the countries from which black operations were directed have not suffered to any appreciable degree. This is because we are satisfied that the governments concerned were not involved in these unfriendly activities. I refer in particular to the cases of Mr Leong Mun Kwai and Mr Tan Wah Piow, both of whom have been used for black operations not by governments but by hostile groups and individuals in friendly countries. If hon. Members would read Mr Leong's disclosures very carefully, it is clear that he had been directed by officials and politicians who appear to have acted without the knowledge or approval of responsible people in authority. The case of Mr Tan Wah Piow is slightly different. Unlike Mr Leong, he was more successful in doing a bunk and finding sanctuary in a friendly country. Hence we were not able to interrogate him and confront him with such evidence as we have. But, in my view, he is of the same breed as Mr Leong. Though Mr Tan Wah Piow transgressed British laws by entering the country with an ineptly forged passport, he was lucky enough to have had some rather influential friends in that country. Instead of being hauled up on criminal charges, he has been rewarded with a place in Bradford University where he is dedicating himself, I understand, to the study of the intricacies of British law. Despite this, we are satisfied that the responsible leaders of government in the United Kingdom could not have been parties to the rewarding of a forger, a black agent, an army deserter and an architect student who failed to make the grade in our University. In addition to low level mercenaries like Mr Leong and Mr Tan Wah Piow, there are more deadly ideological operators and pseudo revolutionaries. They work, with the active or passive support of foreign governments, to further one of the many varieties of communism. Singapore is and will continue to be a target for this kind of subversive operations. Misguided liberals, disgruntled politicians and alienated intellectuals are additional grist to the subversive mill. The latter generally tend to dismiss all references to communist subversion and periodic arrest and detention of subversives as bogies raised by a government intolerant of dissent. This is precisely the frame of mind the dedicated communists encourage and foster among the less dedicated who take up revolution as part-time recreation or as a form of psychotherapy. Hence the readiness with which this kind of revolutionary breaks down and spills the beans when, with the first arrest, he discovers that revolution is a deadly business. The fact that these are misguided weaklings does not make them any less dangerous to Singapore. By helping to confuse the people about the ultimate objectives of the dedicated communists they, whatever their intentions, objectively further the communist cause. Once the communists win, these liberals will be among the first casualties. We only get these weaklings to own up publicly to their stupidities but the Communists, once they are in power as had happened in countries in our region, treat them as dangerous vermin to be exterminated. With reference to the earlier part of the question, in the conduct of our international relations the Government and the people must never lose sight of the fact that an independent Singapore will always be a target for subversion. More so in a period of great and small power rivalries in our region - rivalries not only between communist and non-communist nations but also between communist nations. So in this battle, Singapore will always be a target for influence by these countries and therefore an object for subversion. Singapore may be small but in the power game control over Singapore is. for a rival power or nation, the key to the control of Southeast Asia. That is how the British saw Singapore in the hey-day of British imperialism and that is how the Japanese saw it during their brief hour of glory in Southeast Asia. Singapore in Singaporean hands may not be a threat. But Singapore in the hands of a great power or some other power is a key to the control and dominance of Southeast Asia. So the day Singaporeans or their government are persuaded that subversion, whether from the right or from the left is a bogey, is a figment of the imagination of a desperate government, that day will mark the beginning of the end of an independent Singapore. Once the people develop cynicism towards the periodic arrest and detention of communists, that is the day the communists will have succeeded in their purpose of getting our people to believe that there is no such thing as subversion. In any case there is no need for the PAP Government with its decisive electoral strength to play up the communist bogey to win elections or maintain popular support. We have no need to do that. The reason therefore why we are arresting people like Mr Leong and Mr Raman and making public their admissions is not that we need these confessions to bolster our standing with the people but really to educate our people, especially the so-called liberals, about political realities which must be taken into consideration in the formulation of our foreign policy. That is why, Mr Speaker, Sir, we waited till after the elections before taking action against them. We knew and suspected that something of the kind of either black operations or subversion was going on. Had we done so before the elections, such action would have been seen as the desperate act of a Government unsure of electoral support in the last elections. Not only must our people realise that they must live with the reality of subversion for a long, long time but they must also know how subversion works. Unfortunately, Mr Speaker, not many people believe this. There are still many people in Singapore who are easy prey for subversives. After all, in the last elections thousands of people were taken in by Mr Leong Mun Kwai and his friends into voting for their candidates or the candidates they supported. After all, Mr Leong, as did Mr Raman, did succeed in impressing a very intelligent man like Mr Jeyaretnam and his friends in the Workers Party that they were true and loyal Singaporeans working for Singapore and many people did vote for Mr Jeyaretnam. True, Mr Jeyaretnam claims that he is no fool, but the fact remains that Mr Leong and Mr Raman did fool Mr Jeyaretnam. They must have, for it could not be, I hope, that Mr Jeyaretnam knew what both of them were up to. In fact, Mr Raman has fooled him so completely that even after Mr Raman admitted publicly that he was a communist, Mr Jeyaretnam stated publicly that Mr Raman was not a communist. So when one can fool a man to the point where he makes a fool of himself, that is fooling with complete success. Maybe Mr Jeyaretnam knows Mr Raman's mind better than Mr Raman does. If Mr Leong and Mr Raman can so completely fool Mr Jeyaretnam, then I do not believe that even tomorrow, after listening to this, he will withdraw his public statement that Mr Raman is not a communist. He will still persist in believing that Mr Raman is not a communist. So if they can fool Mr Jeyaretnam to make foolish utterances, then that is all the more reason why we should redouble our efforts to educate our people about the reality of subversion and its devious ways. And this is one of the reasons why so much of time and space is being devoted in the newspapers to publicising the statements, the admissions, by Mr Raman. Tomorrow it will be Mr Arun, and I do not know who else during the coming weeks.

Mr Speaker, Sir, a supplementary question. It appears that Mr G. Raman has been involved in subversive activities for quite some time. Generally speaking, communist activists are believed to be disciplined adults.

What is the Member's supplementary question?

May I ask the hon. Minister for Foreign Affairs what brought about the voluminous confessions of Mr G. Raman in such a short time?

Mr Speaker, Sir, sometime ago I wrote an article in which I divided our communists, and possibly communists in other countries, into two categories. The first category comprises dedicated communists who believe in their cause and who will die for their cause. The other category, to summarise my thesis, comprises what I would call ``goat communists". These are the liberals who play at revolution, and the communists often use them, as in World War II when the Army wanted to clear a mine field `they first sent goats to find out where the mines were and to explode them. They are expendables. That is the role of people like Mr Raman and others. He is not the only one to come out and confess. Earlier on we had a ballerina and others who confessed. These are affluent communists, goat communists, who play at revolution. They think there is a lot of excitement, hoping to find a place for themselves - you know, thwarted ambitions, personal grudges, vanity. So they play around. And they believed that because they had very powerful friends in the United Kingdom, the Western world, who are liberals, newspaper men, to play up their cause, we would be scared to proceed against them. But the moment we do, when they are detained and brought for interrogation they see the evidence that we have and the prospect that if they do not tell the truth they can be detained for five years. If the PAP is going to last for the next 15 years, then they must ask themselves, is this what revolution is all about? Because if the communists come, as has happened in one or two countries in this part of the world, the first people they eliminate are the goat communists who, they say, are weak enough to simulate communism and therefore are dangerous, because when Communism is in power they will simulate liberalism. So they exterminate them. Sir, I suspect that people like Mr Raman and so on are affluent communists, part-time communists, goat communists.

Mr Speaker, Sir, would the Hon. Minister for Foreign Affairs re-affirm in this House that despite the public confessions of both Mr G. Raman and Mr Leong Mun Kwai relations between Singapore and countries like Malaysia and the United Kingdom will continue to be good?

Mr Speaker, Sir, as I have stated earlier, the relations between the governments are good, because we do not regard these operations as operations conducted by the respective governments. Both governments, I believe, are equally satisfied that on basic issues. Singapore/ Malaysia and Singapore/Britain in particular. we have the same objective, that is, to preserve a non-communist world. In fact, if there is any digression or diversion by black operations. we are really tripping one another. I hope this realisation will sink in because relations between the governments are good and, I hope, will continue to be good, unless, of course, the Communists should take over these countries. Then, of course, relations must be invariably bad.

Sir, in the light of communist subversion which, as the hon. Minister has just mentioned, Singapore will continue to face, it is noted that SAF officers will be given instruction on Marxism-Leninism. Will the Hon. Minister enlighten this House - in what way will such instruction or training assist the Government in its efforts to counter this threat?

Mr Speaker, Sir, the education has already started, and we have got the best lecturer on Marxism-Leninism in Mr Raman. He has been telling the people for the last two days exactly how they operate. We cannot convince Mr Jeyaretnam. but fortunately for us, Singapore does not consist of Jeyaretnams. So this is the first lesson in Marxism-Leninism, not in theory but in practice. We hope tomorrow everybody will listen to Mr Arun who is not a Marxist but who has been dragged in. He will be narrating how they operate. There is a gentleman called Mr Derek Davies who is also, I think, a stooge, an unwitting stooge, of the communists. These are lessons in Marxism - how the communists can manipulate non-communists or near-communists without their knowing that they are being manipulated. This is one lesson which has already started. I hope it will be supplemented by more systematic instructions in Marxism-Leninism, not as they say it is but as it actually is. I hope that Members of Parliament will buy the Marxist-Leninist books available in Singapore, study them, and also listen to the speeches of the Minister for Home Affairs who from time to time issues little statements to show what Marxism really is.

Mr Speaker, Sir, there is only one question I want to ask. We are a member of the Commonwealth, are we not? Some hon. Members: Yes.

Then we can bring this matter up at a meeting of Commonwealth countries. If we say that Tan Wah Piow's case is a very small matter, another case will come up. Whether or not, it will be considered at a meeting of Commonwealth countries, we should seek their assistance. What is the use of being in the Commonwealth if they are not cooperating with us? They are going against us. Tan Wah Piow has been accepted by them. They should know that Singapore is a member of the Commonwealth. They should do something about it. The Foreign Minister should take immediate action on this matter. It may be a very small matter but in future it may be a big affair. Singapore must be very careful.

Mr Speaker, Sir, I understand the strength of feeling of the hon. Member. But I have made it quite clear that Mr Tan Wah Piow's operation had not been directed by the Commonwealth. It had been directed by a small group of gentlemen. One was Malcolm Caldwell, who has claimed that he is even superior to Mao because he says he is an anarcho-Maoist. These are individuals who are usually of some influence. They have got him a place in Bradford University. I think the best punishment we can inflict on those responsible for this is to let them have Tan Wah Piow, because sooner or later he is going to create trouble for them too. I think it is better to leave him there, let him be a good lawyer or a bad lawyer. Let them feed him and look after him. That is better than locking him up here and feeding him.

Mr Speaker, Sir, a supplementary question. It may be a small group of persons doing this business. But does not the Government accept the fact that that university is under the control of the Government of the United Kingdom? Why do we allow them to accept him? That Government should stop him. An hon. Member: He has got friends there.

Mr Speaker, Sir, the hon. Minister for Foreign Affairs has mentioned that people like G. Raman and company are the "good" or "soft" Communists. Some hon. Members: "Goat".

Oh, goat communists. Mr Speaker, Sir, my question really is this. Does he mean, therefore, that our Ministry of Home Affairs has been successful only in respect of tackling the soft Communists? Where are the hardcore ones?

Mr Speaker, Sir, there are a few hard-core ones who have not confessed, I mean, you know their names. But who their masters are, we do not know. They may not be in Singapore at all. You read Mr Raman's statement today. Communists are like weeds. You weed them, they grow, and unfortunately you have got to keep on weeding. The moment you stop weeding, the weeds will cover the grass, and that is the end of Singapore.

asked the Minister for National Development and Communications what measures will be taken to ensure that debris, rusty iron rods, metal and stones are cleared before playgrounds and open areas in the Housing and Development Board estates are turfed. and that the use of barbed wires in these areas will be prohibited.

Mr Speaker, Sir, the Housing and Development Board has in the past asked the contractors to make good the playgrounds and open areas in cases where debris were not properly cleared. The Board will continue with this practice, and also exercise greater supervision on the contractors to ensure that all debris are removed. It is the responsibility of the contractors to clean up open spaces and other grounds within a specific time after completing their work. The Housing and Development Board will impose a fine on those who fail to do so. In addition, they are required to clear the debris immediately. Barbed wires are used to fence in newly turfed areas. They will be removed once the turf is fully established.

Mr Speaker, Sir, does the hon. Minister realise that the barbed wires could cause serious injury to children, especially at night when certain areas are not lit?

Mr Speaker, Sir, in the first place, children are not supposed to walk around at night in open spaces where contractors are working. Let me perhaps tell the Member that if it is a well-planned and well-executed playground meant strictly for children to play, then in that case the barbed wires can easily be removed and perhaps other substitutes like wire, string or perhaps straw if he likes, could be used to fence around fields and certain plants as we do now. But in this case we are talking of turfing of playing fields.

Sir, just to clarify a point, I would like to ask the Senior Minister of State whether he realises that in Lorong 8, for instance, the turfed area has a boundary with barbed wire fencing running beside a pathway. At night this area is not well lit, and there is the danger that children might accidentally get cut by these barbed wires. Something has to be done. Could we have a positive answer on this, please?

Sir, the answer is positive. If the Member can inform us of such incidents, we will definitely look into the matter.

Mr Speaker, Sir, if the Senior Minister of State is obliging enough, I will be very happy to bring him to the housing estate and show him a piece of metal jutting out of the ground, not at the corner of the estate but in the `middle of the area where people walk up and down, especially children. Secondly, it is not true that barbed wires are always located in areas which are not frequented by children. I was at Ang Mo Kio last night and I saw barbed wires along the pavement of the main passageways.

Sir, the HDB area office will be most appreciative if the Member can point out where the metal piece is. Like all playing fields and areas under the HDB's management, things of this nature have occurred and will occur. I am answering a question here regarding the removal of debris by contractors, and I say again that it is the responsibility of the contractors to remove the debris, and that a fine will be levied if he does not do it properly. But that does not suggest that incidents of that nature will never occur. I would therefore appreciate it if the hon. Member could bring it to our attention so that we can have it removed.

Sir, if the Estates Officer in charge of Eunos Crescent could just go round and take a look at the turfed areas where the grass is now growing, he will find stones, timber, logs -

Encik Mansor, what is your supplementary question?

Mr Speaker, Sir, the question is: have the officials of the Housing Board ensured themselves that before turfing is carried out, every boulder, metal and sharp objects are cleared off the ground?

Sir, to please the hon. Member, we will try our best to do that.

Mr Speaker, Sir, I think the Hon. Minister has not really answered the question. The question is that the barbed wires in this area be prohibited -

Encik Ahmad, the Minister has answered the question. Mr Yeo Choo Kok.

asked the Minister for National Development and Communications whether the Housing and Development Board has any plan to sell the former Singapore Improvement Trust flats in the Delta Constituency.

Mr Speaker, Sir, former SIT flats are either redeveloped or sold under the Home Ownership Scheme, in accordance with the following guidelines:-

asked the Minister for National Development and Communications, in view of the confusion caused by certain political parties during the recent general elections about the engagement of lawyers for purchases of Housing and Development Board flats, if he will clarify what fees are payable to the Board by purchasers of the Board's flats.

Mr Speaker, Sir, the fees payable to the Board are $15 for engrossed documents and $5 administrative fee. That is all the purchaser of a HDB flat has to pay to the Board itself. However, like any other house purchaser, he has also to pay the usual conveyancing fees to the various Government departments, namely:-

Sir, in the light of the Senior Minister of State's reply, can I ask him a question on the Government survey fee of $100, if I heard him right? Is it not too high a sum to levy? Could the Housing Board take up this matter with the relevant authority to reduce this fee of $100?

Sir, the question should be referred to the Ministry of Finance and the Ministry of Law. However, I will convey his suggestion. An hon. Member: Pass the buck!

asked the Minister for National Development and Communications whether the Housing and Development Board has plans to build flats near the market at 10 kms Upper Thomson Road.

Sir, the market referred to by the Member for Thomson is the second shopping centre built by the HDB at 10 km Upper Thomson Road near Windsor Park Road. The centre was constructed for the purpose of resettling the shop-houses along Upper Thomson Road which were affected by a road widening scheme. The Board bas no plan to build flats near this market.

asked the Minister for National Development and Communications whether arrangements will be made for the Housing and Urban Development Company to build middle - income flats in Jurong.

Mr Speaker, Sir, as the Jurong Town Corporation has already built 424 executive flats in Jurong. there is no immediate need for HUDC to consider building more middle-income flats here. For the present, HUDC is giving priority consideration to middle-income housing developments not farther than seven miles from the City centre.

asked the Minister for National Development and Communications what other major development projects there will be in Changi in line with the development of Changi International Airport.

Sir, a modern new satellite town with a population of about 180,000 people is being planned, just outside the adverse noise zone of the Changi Airport. The town will comprise a series of neighbourhoods, each with its own centre. When completed, it will be provided with a comprehensive range of amenities and facilities for the enjoyment of the residents, including an extensive green park on its periphery. The town will be provided with primary and secondary schools, a vocational institute, a junior college and a sports complex. There will also be a modern traffic-free town centre to be attractively designed for the pedestrians. Finally, a comprehensive public transport system will be designed to make all parts of the town accessible from one another. There will also be back-up facilities for the Airport, such as warehousing and storage of cargoes and sites for associated aerospace industries. These facilities will be planned close to the Airport for operational convenience. There is as yet no detailed planning since the Airport is under construction and reclamation is still going on. But detailed zoning based on the facilities planned for the area will be undertaken. Meanwhile enough land has been set aside for the Airport backup facilities and for the satellite town. Other major development projects are the construction of two expressways, one connecting the Airport to the city through the East Coast Parkway and the other linking Changi Airport to Paya Lebar Airport.

asked the Minister for National Development and Communications how the proposed new bus service scheme for Serangoon Garden Estate will improve the bus service and when the scheme will be introduced.

Mr Speaker, Sir, presently, the Singapore Bus Service Ltd (SBS) operates seven normal services and one Blue Arrow service serving Serangoon Garden Estate. Despite this large number of services operating into and from the Estate. the level of service provided to the residents is unsatisfactory owing to the inefficient network of services. The existing bus service system needs to be rationalised because there is a great deal of wasteful deployment of buses as a result of route duplication. Buses operate into the Estate throughout the day thereby lengthening the time taken for each trip. A study was made by SBS in October last year with a view to improving the level of bus service to Serangoon Garden Estate. After consultations with the hon. Member for Serangoon Gardens and the members of his Citizens Consultative Committee, SBS has proposed the following improvements: (i) Some services will be abolished to reduce wasteful duplication while other services will be modified to better serve the residents. As a result of this route rationalisation, service frequency will be improved from 14 1/2 minutes to about 9 1/2 minutes during peak hours. (ii) A one-man-operated internal service will be introduced into the Estate during off-peak hours. This will provide residents in the Estate with a much better level of service. The proposed route rationalisation is being examined by the Bus Services Licensing Authority to see if the services could be further streamlined. The new scheme will probably be introduced in April as soon as it is finalised and approved by the Bus Services Licensing Authority.

asked the Minister for National Development and Communications when the Public Works Department will demolish the premises in the Kampong Kembangan Constituency made vacant after acquisition by Government to make way for the Pan Island Expressway and the extension of Sims Avenue.

Mr Speaker, Sir, the Public Works Department will demolish the vacant premises in the Kampong Kembangan Constituency as and when acquisition procedures have been completed. The first batch of vacant buildings affected by the extension of Sims Avenue have already been demolished on 5th January, 1977. Another batch of vacant buildings in Jalan Jaffar. Jalan Kuda, Jalan Daud and Jalan Eunos which are affected by the Pan Island Expressway Scheme will be demolished on 15th March, 1977. As acquisition procedures in connection with the two road projects are expected to be completed by early April 1977, the remaining buildings in the Kampong Kembangan Constituency will be demolished only after April 1977. Work to demolish squatter units will only be carried out after the squatters have been resettled. Resettlement clearance is expected to be completed in June/July 1977 for the extension of Sims Avenue and October/November 1977 for the Pan Island Expressway project.

asked the Minister for National Development and Communications what is the overall plan to relieve the heavy traffic congestion along Upper Thomson Road.

Mr Speaker, Sir, to relieve the heavy traffic congestion along Upper Thomson Road, two new major arterial roads will be constructed to cater for traffic from the Upper Thomson Road/Ang Mo Kio New Town areas, viz, the East-West Arterial Road from Upper Thomson Road to Lorong Chuan and the North-South Arterial Link Road from Thomson Road to Avenue 6, Ang Mo Kio. Part of the East-West Arterial Road from Upper Thomson Road to Avenue 8. Ang Mo Kio, is completed and is open to traffic. The second part of the road from Avenue 8 to Lorong Chuan is expected to be completed by March this year The North-South Arterial Road project comprises 3.2 km of roadway and two bridge structures. This new North-South Road will run from Avenue 1, Ang Mo Kio, to cross over Braddell Road and link up with Thomson Road. As parts of the site are encumbered, construction work for the project is being carried out in stages. Phase I of the project near Avenue 1 comprising a bridge across Sungei Kallang and some approach road work is under construction. Tenders for the construction of Phase II of this road from Braddell Road to Thomson Road and for Phase Ill of the project from Braddell Road to Avenue 1 will be called for in June and September this year respectively. The entire project is expected to complete by November 1979. With the completion of this road, the traffic congestion along Upper Thomson Road will be relieved considerably as City-bound traffic from Ang Mo Kio New Town will be diverted onto this new road.

asked the Minister for National Development and Communications whether, in view of the frequent traffic congestion along Jalan Kebun Limau and Jalan Bahagia, he will consider converting the one-way stretch of Whampoa Drive leading to Jalan Bahagia into a two-way road.

Sir, the Public Works Department will be converting the one-way stretch of Whampoa Drive leading to Jalan Bahagia into a two-way road. The project will be undertaken in June, 1977.

asked the Minister for National Development and Communications if he will consider building a bus shelter as soon as possible along Jalan Toa Payoh just outside the Jalan Tenteram Hawkers' Centre.

Sir, with the completion of further stretches of the Pan Island Expressway in the near future, traffic along Jalan ba Payoh (which forms part of the Pan Island Expressway) is expected to increase considerably. The request will then be considered. There are two bus stops along Jalan Toa Payoh near the Jalan Tenteram Hawkers Centre, one with a bus shelter and one without. The bus stops are linked by a pedestrian crossing signal across Jalan Toa Payoh. Pedestrian movements and the pedestrian signal will be reviewed when traffic along Jalan boa Payoh increases. If found necessary, the pedestrian signal will be replaced with a pedestrian overhead bridge and proper bus lay-byes and bus shelters will be provided at these two bus stops.

asked the Minister for National Development and Communications if it is proposed to construct an overhead bridge linking the market and post office sides of Serangoon Garden Way which will provide safe crossing over the heavy traffic.

Sir, Serangoon Garden Way is a two-lane two-way road linking Serangoon Garden Estate to Yio Chu Kang Road. Pedestrian crossing movements near the market and post office are heavy during the morning. To facilitate crossing, the Public Works Department has installed a pedestrian pushbutton signal crossing near this location, which operates from 5 am. to 11 a.m. daily. At other times when pedestrian movements are not heavy, it is not necessary to operate the traffic signals as this would slow down traffic flow and cause severe traffic congestion around this area during the evening peak hours. Since Serangoon Garden Way is only a two-lane road, it is unlikely that a pedestrian overhead bridge across this narrow road will be used by pedestrians. It is therefore not recommended to construct an overhead bridge linking the market and post office sides of Serangoon Garden Way.

asked the Minister for Culture and Science and Technology if it is planned to set up a library in Neighbourhood I of Bedok New Town and when.

Mr Speaker, Sir, there are plans to build a full-time branch library in Bedok New Town when the population there reaches 150,000. A site in the New Town centre has already been reserved for this purpose.

asked the Minister for Culture and Science and Technology whether Radio and Television Singapore will be producing more programmes of its own using the talent and resources available locally, instead of relying almost completely on imported programmes which are often ambivalent to our national aspirations.

Mr Speaker, Sir, production of TV programmes, especially colour programmes, is an involved activity. Adequate facilities and staff are necessary though not the only relevant factors. The available pool of script writers and artistes is a prerequisite. Unfortunately we do not have an adequate pool of such local talents. In spite of this, RTS will endeavour to produce more local programmes wherever local talents are available. It is not correct to say that our TV services rely almost completely on imported programmes. In terms of the total hours of TV programmes per average week, IocaIIy produced programmes constitute 66% as against 34% of imported programmes. Likewise, in terms of the number of TV programmes telecast in an average week, 84 are imported programmes as compared to 67 locally produced programmes. The imported programmes are stringently vetted before they are acquired and telecast. Last year a total of 70 series were rejected outright after auditioning. Some were found unsuitable as they projected Western permissiveness and decadence. Others were rejected because they contained too much crime and violence. The House may also wish to know that all Radio output except the English Service is locally produced or locally compiled. Even in the English Service overseas produced programmes constitute only 10% of its output.

Sir, will the Minister clarify whether the 66% of air time taken up by locally produced programmes include repeat telecast, since inevitably most of the locally produced programmes are repeated within the week?

No, I do not think it includes repeat telecast. It is very expensive to produce a programme locally, and therefore we have to make full use of it. Since most of the locally produced programmes are documentaries, it is a good practice to repeat them because not everyone has the opportunity to see a certain programme at the time when it is telecast.

Sir, since the Minister says that there is a lack of local talents, what plans does the Ministry have to' develop these local talents.

Sir, we have always been trying to develop and train local talent, but unfortunately the pool of local talent is very limited. This is due not only to the limited number of people but also to the limited area of employment. At the present moment TV artistes are only employed by the Television Service. Other than that there is no real outlet for them. In other countries where a film industry exists, the artistes are mainly drawn from the film industry. But in the case of Singapore we do not have a film industry and it is quite difficult to get talent or to have full-time performers because these people cannot get a good living out of it.

asked the Minister for Social Affairs whether the Government has plans to build a swimming pool in the Thomson Constituency and where.

Sir, there is no plan to build a swimming pool in the Thomson Constituency by the Singapore Sports Council. However, it is reported that the HDB will be building two swimming complexes in the Ang Mo Kio Estate scheduled for completion within the period 1979 to 1980. One of these complexes lies at the southern border of Ang Mo Kio Estate and is adjacent to Sin Ming Housing Estate which is in the Thomson Constituency. This complex should serve the needs of Thomson Constituency.

asked the Minister for Law and the Environment whether there is any plan to expand the Serangoon Garden Market and, if not, whether he will consider the possibility of adopting such a proposal.

(In Mandarin): Sir, there is no plan to expand Serangoon Garden Market as there is no need to do so. The market has 148 stalls of which 44 are still vacant. The Ministry is proposing to allocate these vacant stalls to licensed street hawkers from the surrounding areas. There is also an NTUC supermarket and a food centre in the Serangoon Garden Estate. The residents are therefore adequately served by these two markets and the food centre.

(In Mandarin): Sir, the Senior Parliamentary Secretary has said that there is no need to expand the Serangoon Garden Market. Is this decision his own or has he consulted the hawkers themselves before making that decision?

(In Mandarin): Sir, in my answer I have stated that there are 44 vacant stalls in the existing market. So in view of this, is there a need to expand the market to increase the number of vacant stalls?

asked the Minister for Finance whether it is proposed to change the present names of Bedok Highway, Bedok Plain and Bedok Walk in Neighbourhood I of Bedok New Town, and what is the rationale behind the change.

Sir, the present names of Bedok Highway, Bedok Plain, Bedok Walk, Bedok View, Bedok Drive and Bedok Place were given in 1973. Since then, the road patterns in the new town have changed. The Committee on Street Names which is responsible for the naming of new streets and alterations of existing street names has, in consultation with HDB, reviewed the street names in Bedok New Town. It has decided to change the existing names and introduce a new and simple system of street naming which will restrict the number of street names for the generic "Bedok" to street, road, avenue and lane, These Street names could be easily translated into other languages and local dialects. The new street names are as follows: Bedok North Road Bedok North Avenue 1 Bedok North Avenue 2 Bedok North Avenue 3 Bedok North Avenue 4 Bedok North Street 1 Bedok North Street 2 Bedok North Street 3 Bedok North Street 4 Bedok South Road Bedok South Avenue 1 Bedok South Avenue 2 Bedok South Avenue 3

Sir, does not the Minister realise that this will cause enormous inconvenience for the residents in that area? What plans has he got to alleviate this inconvenience.

Sir, I am not aware that it will cause any inconvenience. I thought the purpose of this was to simplify so that it would have the North designated as Bedok North and the South as Bedok South. I suppose that would simplify directions. 3.30 p.m. Pursuant to Standing Order 21(2). the following Questions on the Order Paper stood over to Tuesday. 15th March 1977. as requested by the respective Members:

To ask the Minister for Finance whether it is planned to develop Changi Village as a tourist stopover point in view of its close proximity to the Changi International Airport.

To ask the Minister for Finance what difficulties are envisaged in the implementation of the new Budget System and what measures are being or will be taken to ensure that the system is implemented smoothly.

To ask the Minister for Finance what benefits Singapore has derived from the many double taxation agreements concluded with other countries; how are the benefits assessed; and whether a similar agreement will be concluded with Indonesia.

To ask the Minister for Finance what is the rationale behind the sale of 31 per cent of the Government's equity holding in Singapore Airport Duty-Free Emporium Private Limited to Singapore Airlines Limited; and what are the benefits to the Government from that transaction.

To ask the Minister for Finance what are the criteria for exemption of cultural shows from entertainments duty; and whether he will revise the criteria to encourage more cultural shows with local content to be staged in Singapore. The following Question has been transferred to Written Answer to Question.

To ask the Minister for Finance (a) what was the annual profit of the Singapore Pools (Pte) Ltd during the past five years; and (b) whether his Ministry will use part of the profit to subsidize various constituency sports clubs to promote sports and games or to donate to the building funds of new community centres in those constituencies where fund raising is not easy.

Business Motion

Mr Speaker, Sir, I beg to move the motion* standing in my name, as it appears on the Order Paper. * The motion reads as follows 'That, notwithstanding the Standing Orders, an additional sitting day. namely, Monday. the 14th March, 1977, be allotted for the debate on the motion for approval of the financial policy of the Government for the financial year 1977/78 moved by the Minister for Finance on 28th February, 1977.' Apparently so many of the Members here desire to speak that the one day that is usually set aside for the debate will not be sufficient. Hence the motion.

Question put, and agreed to Resolved, That, notwithstanding the Standing Orders, an additional sitting day, namely. Monday, the 14th March. 1977. be allotted for the debate on the motion for approval of the financial policy of the Government for the financial year 1977/78 moved by the Minister for Finance on 28th February. 1977.

Order read for Resumption of Debate on Question [28th February, 1977]. "That Parliament approves the financial policy of the Government for the financial year 1st April, 1977 to 31st March, 1978" - [Minister for Finance]. Question again proposed. 3.31 p.m.

Mr Speaker, Sir, I rise to support the Motion standing in the name of the Minister for Finance. I found myself much in agreement with what the hon. Minister said in his Budget Statement. Our economy in 1976 was in much better shape than it was in the earlier year. In part, of course, this was due to the economic recovery and dampening of inflation in the leading industrial countries. But we can take due credit for the large number of sensible domestic measures and policies which enabled our economy to recover rapidly. I can find little fault with the basic policies in respect of manpower, science and technology, infrastructure, taxation and promotion. Allow me. however, to offer a few comments which I hope will contribute to improvement. The Minister's Economic Survey drew attention to the recovery of the manufacturing sector by 10% and noted the rise by 3% in productivity in that sector. Lest we rush to congratulate ourselves and our workers for the improvement in productivity, we should not forget that such improvements usually occur as an economy pulls out of recession. We shall still need to bend every effort to make improvements in productivity continually. Furthermore, the Economic Survey also noted that much of the overall increase in manufacturing output was accounted for by an upsurge in petroleum refining activities. Hon. Members may recall that the petroleum refining sector had suffered much in 1975 as a result of the end of the Vietnam War. Col. 571 of the Economic Survey reported that private capital expenditure in 1976 grew by 6% to $2,359 million. The increase, however, was due to the acquisitiveness of Neptune Orient Lines, whose Managing Director has assumed the role of Member for Marine Parade. This increase masked a decline of 8% in capital expenditure on buildings and works and a 10% decline for machinery and equipment. I draw attention to this, Sir, because the volume of investment particularly in plant and equipment will affect the productive capacity of our economy in the future. This failure of investment to respond is, of course, not unique to us. As I pointed out during the debate last year and earlier this year. economic recovery in the advanced countries is being threatened by the failure of new investments being undertaken in sufficient volume. I hope, therefore, that we can make much more headway with the schemes to stimulate private industrial development such as the Capital Assistance Scheme and the Small Industries Finance Scheme. Both of these add up to a paltry $17.73 million so far! The Hon. Minister may also want to pay some attention to the decline of private sector construction of 12% in 1976. I hope he is monitoring the situation so that we can avoid cycles of scarcity and excess, particularly of office buildings, which will affect business rentals, and hence, the costs of doing business in Singapore. The honourable Member for Punggol may be concerned to know from col. 568 of the Economic Survey that the fishing industry declined by 5% in 1976.

That is not too bad. Not to worry.

Perhaps he is comforted by the 8% increase in pig production, the waste notwithstanding. Sir, the Hon. Minister gave a number of tax concessions. In particular, I welcome the further relief in respect of estate duty. However, I hope that raising the exemption limit from $50,000 to $100,000 will not lead to a corresponding escalation of assessed valuation. The Hon. Minister mentioned a budget deficit of $1,505 million, a 32% rise compared to 1976. According to the Economic Survey, in past years, the Central Provident Fund provided 70% of the loans. The amount of CPF contributions in 1977 should be close to $1,000 million. At the same time funds at the disposal of the Post Office Savings Bank rose by $408 million in 1976 to a total of $957 million. And we have $8.2 billion in foreign reserves as against foreign debt of only $660 million. Clearly, there is no lack of availability of funds. However, I am a little concerned about the distribution of public and private investment expenditure in Singapore. In 1973, the private share of total investment was 82.7% while in 1976 the corresponding share was only 75%. I hope that either the Ministry of Finance or the Monetary Authority of Singapore is studying the flow of funds and the utilisation of funds in Singapore. While I welcome the Post Office Savings Bank's efforts at encouraging saving, part of its funds represent a redirection from private banks. To the extent that this is so, the private sector's access to that savings for investment purposes is restricted. Members may also note that there is no reference to exchange rate policy in the Economic Survey or the Budget Statement. While I am sure that the Monetary Authority of Singapore is in competent hands, I should like to see some reference in future. Exchange rate policy has a bearing on monetary, fiscal and wage policies and vice versa. For example, in col. 635 of the Economic Survey, it is noted that money supply, defined as MI, grew at 18%, due mainly to larger inflow of foreign funds. This, however, could be due to a repressed exchange rate designed to preserve the competitiveness of our exports. If this is so, the increase in foreign reserves is no mystery. I should also like to see quarterly figures presented in the Economic Survey so that we can better analyse the trends in our economy. Moreover, end-of-year figures, particularly in such items like money supply can be quite misleading. Looking at our prospects in 1977, although I am very concerned about the undercurrents such as insufficient investment in the industrial countries, the year itself should be fair for us. Sir, I am in full support of the basic economic policies laid down by the Minister for Finance. 3.38 p.m.

Mr Speaker, Sir, in a period when the world economy has barely recovered from the oil hike of a few years ago, and the effects of the latest OPEC increase in oil price yet to be felt, it is most welcome to have a moderate budget for the coming fiscal year. I would call it a painless budget, for it provided no shocks. The emphasis, as in the past few years, has been on investment projects and generally to create a more conducive economic climate for foreign investments which will in turn create more job opportunities. The increase in taxes on alcohol and tobacco will not, of course, be welcomed by those who habitually drink and smoke, nor by those in the tobacco and alcohol industries, nor by those in allied trades because of possible falling sales. But, Mr Speaker, Sir, who can say that alcohol and tobacco are basic commodities essential for life? In fact, healthier living is to do without them. The other aspect of the budget estimates which I welcome is the raising of the maximum amount of estate duty for exemption purposes from $50,000 to $100,000. As we all know, every year sees an increasing number of Singaporeans becoming owner-occupiers of houses or flats. In many cases, this has only been made possible through the Government's public housing schemes enabling CPF contributions to be utilised for the purchase of HDB and HUDC flats. For these categories of Singaporeans. owning a flat would otherwise not be possible. These lower and middle income groups must realise that our Government provide them the opportunities and the incentives to have a stake in our society. This is their privilege as Singaporeans, and as of right. In thus providing for the lower and middle income groups opportunities at home-ownership, we are surely striving for a more egalitarian society. The private property developers and entrepreneurs can no longer have a monopoly on housing. I would say the general effect of the Government housing schemes has stabilised the prices on the property market - no longer can there be the quick and vast returns on property speculation and development. Growth and development of housing now take place in a more orderly and gradual fashion; the not-so-wealthy sections of Singapore society are thus not left behind, nor are they denied the opportunities of house ownership. Thus, the budget estimates before us in raising the amount from $50,000 to $100,000 for exemption from estate duty is a very welcome one. This will ensure that those who have utilised their CPF contributions for the purchase of HDB and HUDC flats will not be penalised. What the CPF is meant for, that is, security at retirement, is now more usefully deployed. Mr Speaker, Sir, in all budget debates at the start of every fiscal year, especially so at the commencement of a new term of office - the Fourth Parliament of the Republic - it is not irrelevant for the Government to take stock of the machinery of Government - i.e. the civil service and the statutory boards. We cannot ignore the role played by the civil servants in implementing fiscal policies of the Government, or for that matter the general functionings of a government. Because the same party continues to be in power. this must not lull the civil service into an attitude of complacency. In the last session of this House, some comments were made on the civil servants. The point which I now wish to make is that what the civil servants do, and how they go about doing their work, has constantly to be examined. The civil servants, in implementing Government decisions and policies, and especially the top civil servants who also advise Government Ministers on their portfolios must, in my opinion, have as broad a perspective as possible of the matters they deal with. I have observed that the upper ranks of the civil service tend to be attached to a particular Ministry or Department for many years. Without the constant and regular rotation of the top civil servants, I get the impression that some of them are so entrenched that they have the full support of their Ministers, and therefore, they assume that whatever they do will always be backed by their Ministers. This is surely not very desirable. There are, of course, pros and cons for the frequency of rotation of civil servants among the various Ministries and Departments. On the one hand, there are valid arguments for the need for continuity in the staffing of Ministries and Departments. This is to facilitate not only the process of decision-making by the Government and Ministers, but also internal administration, and in serving the public. I recognise that in Departments such as the Inland Revenue, Police, Customs or the Industrial Relations Division of the Ministry of Labour, either because of the nature of the work involved or the continuity of services rendered, there need not be the same degree of rotation of staff for the middle-ranking and junior civil servants. On the other hand, there is an equally valid argument that the civil servants in the higher reaches of Government service should have as wide an experience as possible of administration in the various Ministries or Departments, so that they can have a better understanding of the people whom they are supposed to serve. Members of this House may recall that several years back when there was a difference of opinion over priorities in expenditure, this was resolved by the Minister for Finance and the Minister of Defence interchanging portfolios. It is natural for each Ministry to view the priorities of the Republic on the basis of the needs and functions of the respective Ministry. My point in quoting the example is that the outcome of the interchange of portfolios has turned out to be most satisfactory. It is very probable that in the functioning of the various Ministries misunderstandings might arise among senior civil servants who are attached for too long to the same Ministries, and who might not be able to appreciate the dimension of any problem from an overall point of view. There is thus an advantage in regularly rotating senior civil servants among the various Ministries and Departments. Without a constant re-appraisal of the functions of the civil service, undesirable characteristics may arise. Some top civil servants develop the mentality of pleasing only their Ministers, and, of course, everyone tries to please the Prime Minister. If they report everything is ship-shape to their Ministers. then nothing is wrong with the Ministries they are in. Should junior staff have grievances. or if their workload cannot be discharged satisfactorily, this does not matter, since the Minister concerned does not know. This has the adverse effect of junior civil servants doing only the minimum, and doing things only to please their superiors. They no longer discharge their duties as responsibilities, rather as chores in order to keep their jobs. Staff morale may be low; efficiency may be low. When this bureaucratic attitude builds up, the public is adversely affected. Matters are not attended to promptly. For example, the problem of getting an immediate and satisfactory response from the civil servants. I am sure some of the hon. Members in this House have experienced, as I have. the frustrations in getting civil servants to act on the complaints we have made on behalf of our constituents. When complaints are sent directly to the press, they seem to be attended to much quicker by the civil servants than those complaints they receive from Backbenchers. This would seem to me that civil servants are afraid of the unfavourable publicity which might draw the attention of their superiors, and. indeed the Ministers, to their shortcomings. Therefore, they have every reason and inducement to act promptly on letters of complaint in the local press. Mr Speaker, Sir, may I ask: is this right, or is this desirable? While I agree that the local press should serve as a forum for views and complaints, and that the Ministries and Government Departments concerned are seen to do their jobs, is this all for show? lam not suggesting that all Ministries and Government Departments are chronically inefficient, but there appears to be this developing trend. I contend, therefore, in order to keep the civil service on its toes, particularly the rank and file, there should be regular rotation of senior civil servants. New brooms, Mr Speaker, Sir, can sweep cleaner. A second characteristic which can develop, Mr Speaker, Sir. if the top echelons of the civil service are not regularly rotated is the possibility of empire building. By this I mean a tendency to develop a power base on the part of the top civil servants, achieved I suppose by promoting only people who see eye-to-eye with their superiors. I am not saying that this is a common practice, but the tendency is surely there. If there is more frequent and more regular rotation of top civil servants, they will not be able to grow powerful roots. A third feature of civil servants which I find objectionable is the secrecy which sometimes surrounds their work, and a habit of name-dropping. As an excuse for not disclosing the true state of the matter, which might be embarrassing to the civil servants, as possibly the matter concerned is in a sorry state for lack of attention, they dispose of any queries by saying the matter is being studied by the Minister who does not want publicity. Matters which should be attended to, therefore, get swept under a carpet of secrecy. No one need know that the civil service is getting more bureaucratic and less efficient. The top civil servants, after remaining in their positions for long periods of time. would often make reference to a certain Minister, or even the Prime Minister, in order to deter further queries. Likewise, some are in the habit of quoting the Prime Minister, e.g. name-drop that so-and-so is from the Prime Minister's Office, and he gets attended to very promptly. Others, even the Members of Parliament are met with a sluggish response, if at all there is going to be a response. I hope. therefore, Mr Speaker, Sir, that in a budget debate the effect of our fiscal measures must be seen against the interests of the people, and here I have stressed how the civil service fits in. Any budget before the House must be aimed at establishing a more just and a more humane society. However, the attitude must never arise that there is a "them and us" - those who are governed. and those who govern. Because we in Parliament are collectively the servants of the people - those in the civil service are not there to serve us, but the people. In this connection, I have asked for a re-appraisal of the civil service - perhaps a kind of "shake-up" is in order. 3.55p.m.

Mr Speaker, Sir, to the average taxpayer in the wage earning, class, the budget is a disappointment. As the economic situation recovered, albeit slowly in 1976, he had perhaps wistfully hoped that there would be some form of tax relief in 1977. In the event he is disappointed. From his point of view, the budget is not really a painless one. He is not sure whether he should be thankful or annoyed with the Hon. Minister for showing such persistent concern for his health by raising the taxes on tobacco and liquors second year running; even the concession in estate duty on owner-occupied property appears quite meaningless to him for the time being, as he has no wish of taking advantage of it as yet. It would have been more meaningful if he were allowed the use of his CPF balance which has by now totalled thousands of dollars attracting only a meagre rate of interest, to repay part of the mortgage which he has on his private accommodation. As our average taxpayer ponders on the implications of the Hon. Minister's Budget Statement, I believe he feels a little sore and perhaps confused as to what it all means -all these talk about "from each his best; to each his worth". It seems to him that under the existing tax structure if a person is unfortunate enough to be a wage-earner who, for the purpose of the Inland Revenue Department, may be defined as a person having no chance of being able to either legally avoid or illegally evade the full incidence of tax, the better he is in his job the more heavily he is taxed as he rises in his position. Sir, the plights of our tax-paying wage-earners have been raised time and again in this House but the Hon. Minister for Finance has time and again refused to consider any change in a system which we have inherited from our colonial past and, to say the least, is clearly unsuitable for a fast changing and developing society as our own. We aim to motivate our members to give of their best and to give rewards and recognition to those who excel in high performance but our tax system does not seem to reflect this philosophy! What we have is a system that encourages every man to try to be his own boss so that he could beat the system, so to speak, and enjoy all the tax deductions generally available to business firms, big or small. The end result: A nation of shopkeepers - if we do not watch out. Only a few days ago we heard of the Hon. Minister for Health lamenting the high rate of turnover of young doctors at Government hospitals; instead of just blaming these people for their lack of sense of belonging or loyalty or whatever you may choose to call it, should we not try to look objectively at the way in which they are remunerated and the way in which they are taxed if they stay on as employed persons as against the financial prospects of their becoming their own bosses in private practice. Sir, the personal taxation system that we have, I submit, needs to be completely overhauled fairly quickly before an increasing number of key personnel which include all categories of professional managers, administrators and technicians employed on salaries, in both our private and public sectors, work themselves to a point of financial disincentive. When that point is reached, a person either feels discontented, in which case he starts to look for greener pastures or try to set up some sort of business or practice on his own; or, he simply allows himself to slacken off in his job. There will be only four cylinders instead of eight cylinders working, Sir. Or maybe two cylinders! Whichever the course of action or attitude he finally adopts, it does us no good as, at this stage of our economic development, we need all the experienced people in the industry and in Government service continuing to give of their best. It is all very well to say we believe in "taxing the rich to subsidise the poor", or do we? I am not sure. Are we sure that those bearing the brunt of tax incidence are really "the rich" and those benefitting from whatever little State subsidies left, are really "the poor"? I am not sure, Sir, but I would humbly suggest to the Minister for Finance to give some thought to my queries. With all the brains that he has at his command in his Ministry, I am sure, Sir, he would be able to come up with an answer and hopefully we, the wage earners, can look forward to a more equitable system of taxation at the next Budget. Sir, I would not like to turn to the Hon. Minister's comments on Trade Development in 1977. First of all, I would like to know what he proposes to do about narrowing the very substantial trade deficit of close to $2 billion with Japan. This is not the first time queries are raised in this House on this perennial imbalance of trade and it would seem to me that little has been done to get the Japanese to buy more from us. If we have not already lodged a strong representation with the Japanese government in this regard, I would urge the Government to seriously consider doing so. On Trade Development generally, I agree with the Hon. Minister that our tactics should be to consolidate markets that we already have and at the same time explore new ones. The idea of setting up permanent exhibition centres in selected countries abroad is a good one, but before doing so I feel that we should perhaps look at our export promotion efforts ir. a rather more systematic manner and with the same degree of special care and attention that we have devoted to the task of investment promotion abroad. Up to this point of time, our export promotion efforts seem to be conducted haphazardly, rather disorganised if I may say so, and without much co-ordination. We hear of trade missions from different organisations going off every now and then, but what follow-up actions are taken and with what results -do like to know. I think we could achieve more if there is proper overall planning, organisation and co-ordination among the various trade and manufacturers' associations. Surely, Sir, the creation of an export promotion agency is the answer. With the Government providing the necessary organisation and the lead. I have no doubt that our businessmen will be only too happy to give their wholehearted support and cooperation. There is no short-cut in trade development. In order to do well in our export drive, we need to know more about overseas markets; to know more. we need to travel more and ultimately we will sell more. Sir, as an insurance man, I find it difficult not to say a few words on the concessionary tax rate of 10% announced by the Minister on reinsurance business. To the lay public, this gesture on the part of Government may not mean very much but, speaking as a professional. I cannot help feeling excited over the likely prospect of Singapore developing rapidly into a significant international reinsurance centre over the next few years. The concessionary tax rate of 10% added to our locational advantage and good business infrastructure, such as a highly efficient telecommunication system among other things, will greatly assist in the development of this type of international business. It is a little known fact that one of the larger items of Britain's invisible earnings is from insurance and reinsurance. For example, in the year 1974 the City of London derived 41% of its invisible earnings from insurance and reinsurance, whereas the rather more prestigious business of banking contributed only 20% of a total sum of 905 million pound. The Swiss and the Germans have also over the years developed extensive interests in the reinsurance business. Given the necessary encouragement from Government and the determination on the part of the private sector to succeed, there can be little doubt that the tax incentive will go down as an important milestone in the history of the insurance industry in Singapore. The gesture on the part of the Government, I hope. is also an indication of the greater recognition of the potentials of insurance business by the Government which hitherto has paid very little attention to the development of insurance industry. This is evidenced by the fact that for some time now, the Insurance Commissioner's office has been without a full-time Commissioner; the present Commissioner being concurrently a Deputy Secretary attached to the Ministry of Finance, and insurance is but one of his many responsibiIities. Since the Minister's announcement of the tax concession I have read in the press that with effect from 1st April the Insurance Commissioner's office will come under the control of the Monetary Authority of Singapore, and I do sincerely hope that this will be a change for the better. In the final analysis, the efficacy of the tax incentive will be determined by two things:-

(In Mandarin): Mr Speaker, Sir, I rise to support the Motion standing in the name of the Hon. Minister for Finance. The Minister has described the 1976 economic performance as "not unsatisfactory." With a 7% real growth in GDP, a 2% inflation rate (in terms of GDP deflator) and a 8.1% increase in domestic fixed capital formation, the performance is a fairly good one, particularly in view of the sluggish economic recovery of the advanced countries which our economy is heavily dependent on, in the second half of the year. Regarding our growth prospect for 1977, the Minister is more cautious, taking note that the OECD countries are expected to grow at a slower rate than in 1976. In the midst of economic uncertainties, the painless budget as proposed by the Minister is a sensible one. Only minor tax increases on liquor and tobacco products are proposed; at the same time, the increase in the Government recurrent expenditure is kept to a minimum. thus allowing more revenue resources to be transferred for development purposes. Hopefully. between now and the next Budget statement, the Minister will not give us any surprises and shocks. The recovery of our economy is still too new and fragile to absorb any shock of major tax increases. I note that the Minister, in his Addendum to the Presidential Address, has reserved the option of changing taxes as "one way of helping to encourage or discourage one kind of activity over another." This is fair enough. as using tax changes as an instrument for reallocating resources among economic activities is an integral part of fiscal policy. However, it is hoped that the important suggestions made by the Fiscal Policy Implementation Committee are to be debated in this House before they are implemented. This will be in accordance with the spirit of the President's statement that "No major policy or legislation should be passed without the closest scrutiny, and passed only after the most thorough debate." Sir, in the Budget statement, the Minister has also stressed the importance of diversification and flexibility in our development strategies. and reiterated the five-point Economic Strategy Programme. Diversification means finding alternative markets, engaging in different economic activities, and purchasing from different sources of supplies simultaneously. With diversification, our economy is less vulnerable to a sudden slack of a given activity or in a given market. In general. we have been successful in diversifying our economic activities. On the other hand. our economy is still heavily dependent on the USA, Japan and the EEC countries. Economic realities dictate that for our future economic growth, we have to continue to depend on these advanced countries for markets for our exports, sources of capital inflow, and supplies of machinery and equipment and technology. Geo-political considerations, particularly after the Communist victory in Indo-China. have brought the ASEAN countries closer together than before. This is evident from the five ASEAN industrial projects, our bilateral tariff accords with the Philippines and Thailand, and the recent Agreement on ASEAN Preferential Trading Arrangements. These are welcome steps towards greater regional economic cooperation. Let us, however, also be realistic. Given the present disparities in the level of development. economic structure, trade pattern and pace and strategy of industrialization, intra-ASEAN trade would be comparatively less important than ASEAN trade with the USA, Japan and the EEC countries. and the scope for industrial cooperation among the ASEAN countries would remain limited for a long time to come. At present, the better strategy .for the ASEAN countries would be to form a united front in dealing with these three advanced economic blocs in matters relating to tariff and non-tariff barriers. In this context, it is of particular importance for the ASEAN countries to pressurise Japan which has been enjoying huge surpluses in trade with ASEAN. Sir, flexible economic policies mean that we should do away with any rigid form of economic planning. In fact, the Government has not published any five-year economic plan since independence. Instead, ad hoc policies have been implemented to soften the impact of economic crisis originating from external sources, and to seize new economic opportunities which have appeared on the horizon. Given the need for flexibility and the emphasis on efficiency, it is not surprising that statutory boards have been used to implement or even to spearhead various economic and social development programmes. The attractiveness of this form of organisation is that it enjoys greater flexibility and is given more initiative to carry out its specific functions without the loss of ultimate responsibility to the appropriate Cabinet Minister. However, as board members and top management staff have been appointed by the Minister concerned, the activities of these boards are one step removed from direct accountability to the Parliament. Another problem area pertains to the appointment of directors. Top civil servants are normally appointed to board membership and some of them often take on several directorships simultaneously. On the positive side, interlocking directorship helps to keep these boards in line with major Government policies; on the negative, it can be a source of strain and pressure to the civil service. With their time and energy divided between several jobs, these civil servants cannot devote their best efforts and talents to each job and at the same time thoroughly understand the problems at hand. Also, because of their positions, the opinions of these top civil servants normally carry susbtantial weight in the boards. A few over zealous and powerful civil servants may therefore reduce managerial initiative. Without a national plan which maps out the relationship between various statutory boards and their relationship with the governmental departments, coordination between these organizations seem to be lacking, thus giving rise to duplication of effort in some cases and unnecessary delay in others. As the role of statutory boards in our national development is likely to become n-ore important. the abovementioned problems and some other problems I have not yet mentioned have to be rectified so that their usefulness and efficiency would not be affected. Mr Speaker, Sir, let me now turn to the five-point Economic Strategy Programme. The programme has been expounded by the Minister for Finance. The programme is realistic, as it reflects the nature of the Singapore economy as well as her role as an urban centre. The programme would also help us to attain the long-term objective of transforming our economy into an industrial centre and a base for regional and international services. However, I would like to make a few comments. First, on the manpower development programme. the Hon. Minister has only made reference to graduates of technical institutions, I wonder whether the output of university graduates has been included in the manpower development programme. Recently, a local newspaper has flashed the headline about the employment prospects for some university graduates. Sir, it would be a waste of human resources if we continue to produce unemployed graduates. I wonder whether the Ministries of Finance and Education have arrived at some coordinated policy on the intake of university students into various faculties. Secondly, although training and education would increase the working capacity of an employee, whether he will give his best depends on his attitudes towards work. The Minister has mentioned that "to instill correct work attitudes in our workers, employers must provide a proper working environment." Sir, I think this is grossly inadequate. The much more important motivational forces are rewards. Rewards could be classified into two types: intrinsic rewards such as a sense of accomplishment, pride in one's products and job satisfaction and extrinsic rewards, such as wage increases, bonuses. promotions etc. Sir, I submit that in a market economy and materialistic society like Singapore, intrinsic rewards have become impotent as a motivational force, particularly in areas where the production process is characterized by capital-intensity, a fine degree of specialisation, and mass production. Thus, the most pragmatic and effective approach to motivate employees (not just workers), to give of their best and to raise productivity is to assure them that they can derive monetary gains from such efforts. Employers must draw up appropriate incentive schemes, not just provide better working environment if workers are to be motivated. In relation to this matter, the Minister has correctly pointed out that while workers must put in their best, employers have an equal responsibility to improve their management of personnel or of plant and equipment to increase productivity. May I add that it is also the responsibility of' employers to train workers and to upgrade their skills. This is particularly true in the case where the employers are the multi-national corporations. Our Government has given various concessions and incentives to attract these corporations; it is only fair that they should, in return, train our workers, transfer their technology and management techniques, thus helping us to increase our economic productive capacity. 4.20 p.m.

Mr Speaker, Sir, the Minister for Finance has presented a very moderate and sound budget for the new financial year on the 28th of last month. It is a well balanced budget. The people of Singapore are happy to hear that there are four tax concessions and no increase in revenue through increased taxation on necessities. Only the duties on liquor, cigarettes and tobacco are increased with immediate effect. Such taxes do not concern the people's daily life. As cigarettes, tobacco and liquor are considered as luxury items and harmful to health, I am sure Singaporeans are happy to accept the right decision of the Government in imposing more taxes on these three commodities. Mr Speaker, Sir, according to the new Budget announced by the Minister for Finance, total expenditure for the new financial year will be $5,459 million as against the main revenue estimate of $3,362 million. After almost self-cancelling tax increases and tax concessions, the projected budgetary deficit is about 8% up, at $1,505 million. According to my own analysis, Mr Speaker, Sir, I think this deficit in our Budget does not mean that our economy is in trouble. As I can see it, the estimated revenue of $3,362 million is more than enough to meet the recurrent expenditure, and secondly the deficit has arisen mainly from the appropriation of $2,708 million as development expenditure to stimulate the economy and accelerate economic recovery. In addition, Mr Speaker, Sir, to meet the deficit, the Minister for Finance has proposed some drawing down from the Development Fund of Surpluses that have been accumulated over the years or borrowing by the Government. In view of the Republic's high credit standing in international markets, there should not be any problem with the raising of loans. Mr Speaker, Sir, the Budget is ably presented by the Minister for Finance. Therefore, it is very difficult for a non-economist like me to make comment on the Budget. I have read the Budget Statement many times over the last few days. I really find it very difficult to criticise the Budget Statement except to bring out a few points for the attention of our Government. Mr Speaker, Sir, the Minister for Finance has mentioned that our manpower development programmes must now emphasise training in more and more specialised skills. I think our Government has taken a right step in this direction. As we know, manpower is the most valuable resource we have. Therefore, the best possible training and education must be provided to our young population if they are to be sufficiently equipped to serve the needs of our nation and industry. Mr Speaker, Sir, as we all know, today, Singapore still has to rely a great deal on imported foreign expertise in both commerce and industry. With our present rate of manpower development programmes, I hope our Government will inform the House when Singapore will be able to be self-sufficient in her needs for professional, management, technological and other specialised skills. Mr Speaker, Sir. in the rapid process of urbanisation and industrialisation in Singapore, our life styles have changed, but I wonder whether we have changed for the better or for worse. Sir, there is one thing I am quite sure. Progress will bring along with it more wealth. In some Western countries today, over-affluence has caused youths to lose their diligence and willingness to work. They fall out of society and take to escapist life styles, seeking refuge in drug-taking or form their own sub-cultures. Fortunately, Sir, Singapore is not entirely immune to such social diseases, but with greater preventives, we can save our children from degenerating cults alien to our country, like hippism and drug-addiction. The responsibility of protecting our future generation falls on us, both Government and parents. It will be a demanding task which we have to carry it out well. How shall we educate our children in the future on their responsibility to themselves and to society? This problem must be faced now and it is one which calls for long term planning. Our education must be bilingual, including moral and civic training. This is a primary need if we are to build a strong and rich nation, with both heart and soul. Mr Speaker, Sir, our future is full of uncertainties and difficulties. Our future is a challenging one. In the next few years we have to face the challenge to govern and the challenge to hold the nation together. We must not fail. Otherwise whatever we have achieved over the past years under the able leadership of the People's Action Party Government will be lost through chaos created by ourselves. Mr Speaker, Sir, in any chaotic situation, life cannot remain comfortable, no matter how advanced we may be or how much we possess materially. Normal life will be uprooted; for instance, general strikes and riots in the Lim Yew Hock Government. We must learn from such painful experiences if we are not to be pushed to the threshold of national disaster. Mr Speaker, Sir, before I conclude my speech, may I seek an assurance from the Hon. Minister for Finance that our Financial Policy is not only to continue to pursue our long term economic strategy programme for our economy's transformation to an industrial centre and a base for regional and international services but to see that our per capita income distribution is always towards equity. As we know. Sir, for the past few years our per capita income distribution is not ideal as the trend is not always towards equity. There is still a wide gap between the rich and poor. Therefore, Mr Speaker, Sir, I hope the Hon. Minister for Finance will look into this serious and important matter urgently. In conclusion, Sir, all in all, Singapore is in a very sound financial position. This is a budget that is welcomed by all the people of Singapore and I hereby wish to join my other colleagues in support of the Financial Policy.

Order. I propose to take the Suspension now. I suspend this Sitting and will take the Chair again at 5.00 o'clock. Sitting accordingly suspended at 4.31 p.m. until 5.00 p.m. Sitting resumed at 5.00 p.m.

Resolved, "That, notwithstanding the Standing Orders, this House do adjourn at 6.00 p.m. today" - [Mr E. W. Barker]

Debate resumed. Question again proposed.

Mr Speaker, Sir, I would like to join my colleagues in paying tribute to the Finance Minister for giving us such a clear picture of our economic performance in 1976 in his Budget statement. In 1976 we saw a gradual recovery of the world economy. However, the economic situation was still gloomy because of the uncertainty of oil prices and the fear of another round of galloping inflation. Under such circumstances, industrialised countries were not too hopeful for a good economic performance. We in Singapore also faced the same problems and yet we managed to have a real economic growth rate of 7%, a satisfactory growth rate considering the overall economic conditions at. home and abroad. This, I should say, is due largely to our efficient Government in implementing our policy of diversified economic activities, which helps cushion the impact of world economic fluctuations on our country. Our nation is a small nation, dependent on foreign countries for our requirements. We are therefore vulnerable to unfavourable economic developments in other countries. In other words, most of the factors that affect our economic growth are beyond our control. But our Government does not use this as a scapegoat for not being able to manage our resources well. On the contrary, the Government tried its best, manipulating the factors which were under its control so as to counter the unfavourable economic effects of the factors which were beyond its control. The fact that we managed 7% real economic growth rate whereas industrialised countries in the Organisation for Economic Cooperation and Development (OECD) managed only 5% real economic growth rate reflects the success of our Government's efforts. The economic prospects for 1977 are not very bright. This is due to the slowing down of world economic recovery. Industrialised countries, fearing that another round of inflation will set in, are cautious in their economic development. Another restraint to economic stimulation is the uncertainty of the oil price caused by the split of the OPEC nations over the increase of oil price which resulted in the recent two-tier oil price. Therefore, as a whole, our economic prospects for 1977 do not seem too promising. However, the Government has a plan for action. In the efforts to further strengthen our economy, the Minister for Finance said that steps would be taken to strengthen our trade, investment and diplomatic offices in key centres to safeguard our economic interests. Greater efforts will be made to attract more investment from the United States, Japan, West Europe and West Asia and to maintain steady progress in our economy. With a firm economic base and the steps that will be taken, the prospects of achieving an annual growth rate of 6 to 8% are not gloomy. It is also hoped that the domestic policies drawn up by the Government will counteract some of the more negative effects of the world economic slowdown of our economic performance. It is the aim of the Government to contain wage inflation in our country. Therefore, the Government has drawn up policies of orderly wage increases. Wage increases are based on the productivity of workers. It is largely due to the success of our wage policies that we are able to remain competitive in international trade. These policies are essential because of the present world situation. The industrialised countries were badly affected in the severe slump a few years ago and the slow recovery of the world economy that follows. As a result, the industrialised countries are faced with severe unemployment and spare manufacturing capacities. In order to solve their problems, these countries may reduce the prices of their manufactured goods to stimulate their economies. Thus we have to be prepared for such action by the industrialised countries. To remain competitive in international trade, we have to keep the prices of our manufactured goods low. Thus the need to control wage increases. In recent years, increases in wages are based on the recommendations of the National Wages Council (NWC). This method of granting wage increases has favourable effects on our economy - it prevents workers from demanding excessive increases in their wages. However, it is not without criticism. There is a danger that employers may take advantage of the Government's restraint on wage increases by not granting wage increases to workers even though the productivity of the workers has gone up. Instances when employers pay large amounts of bonus to their top executives and yet refuse to grant pay increases recommended by the NWC to the workers have come to light from time to time. Perhaps the Government should give some attention to the problem before undesirable effects set in. The NWC's recommendations for wage increases are based on the productivity of workers. However, measuring the productivity of workers is by no means easy. The only guide to the productivity of workers is the profit of the employer. Therefore, it may be better to make it compulsory for employers to grant salary increases recommended by the NWC. The NWC should recommend a range of percentage increases in salary. To make the increases in salary commensurate with the increases in productivity, increases in salary should be based on the profits of the employers. Thus employers must grant salary increases within the range recommended by the NWC. One may argue that those employers who are just breaking even or are making a loss will be forced to go bankrupt. If we look at it from the economic point of view, this may be favourable. Our resources are scarce and therefore we must make full use of them. If employers are not able to make optimum use of their resources, it is better that they go out of business so that the resources can be redeployed more efficiently elsewhere. Sir, I would now touch on the question of tax increases and concessions. On the whole, the budget can be described as a relatively painless one, with increases in tax only for cigarettes and intoxicating liquors. Generally, it is very moderate and well received as it does not directly affect the livelihood of the majority of the people. Such increases will undoubtedly be passed on to consumers by the dealers, and the smokers and drinkers will certainly have to pay a higher price. The aim of increasing the tax on cigarettes. according to the Finance Minister, is to discourage smoking and not on revenue consideration since the yield in revenue will be offset by tax concessions. However, I doubt the increase in the price of cigarettes can be effective in discouraging smoking. Notwithstanding the fact that the Government has been making efforts to advise and urge people against smoking and the mass media have long ceased carrying advertisements on cigarettes and tobacco. the number of smokers has not decreased but tends to increase instead. Increase in the price of cigarettes has a very marginal effect on its demand because the demand for cigarettes is highly price-inelastic. Therefore, the people will continue to pay for the higher prices and will instead economise on other expenses. For example, if they save in their marketing by cutting down on more nutritious food, their health may be affected in the long run. I believe a more effective way to discourage smoking is to educate the people on the grave health hazards of smoking, and this can be done through the mass media and in the schools. Sir, turning now to tax concessions, I would say that the general public is pleased to learn that the Government is very generous in granting certain tax concessions at a time when more revenue is required to cover the high expenditure. However, a closer examination of the tax concessions shows that only a very small fraction of the people stand to benefit, and the majority of them are from the upper middle-income group. In particular, the concession on estate duty will not benefit the lower-income group at all. Only people in the upper middle-income group and a minority in the lower middle-income group who own houses valued at more than $100,000 will benefit. For these people, paying $8,837.50 in estate duty for a $200,000 house is not a problem at all. The changes in taxation seem to affect the `have not' and not the `have'. Both the rich and the poor consume cigarettes and intoxicating liquors. Thus, the increase in taxes for these items will affect both groups of people equally. On the other hand, those who will gain from the tax concessions are the rich. For the rich, the increase in the tax burden due to increases in taxes for cigarettes and liquors is offset by the gain in tax concessions. However, for the poor there is nothing to offset their extra tax burden. Thus the gap between the rich and the poor will widen. The Government may have noble objectives in giving the four tax concessions. For example, the concession in estate duty is introduced to encourage home ownership, the tax concession on offshore income derived from Asian Dollar Market operations is given to further develop Singapore as a financial centre, and the tax concession on income from reinsurance business is to take advantage of our ideal location and good business infrastructure so as to develop Singapore into an important centre for reinsurance business. Such objectives are good for the country as a whole and I am not against them. What I am concerned is that the Government, being too pre-occupied with these objectives, may neglect the welfare of the lower income group and the poor. 5.15 p.m.

Mr Speaker, Sir, the Minister for Finance concluded his Budget Statement with the remark, "The weather is getting fine and fair and our Ship of State is in good shape." I cannot agree more with him about the condition of our Ship of State but I am not as optimistic as he is with regard to the weather ahead. In fact, the Minister did hint of impending dark clouds in the horizon which could jeopardize his forecast, although he did not elaborate on them. But I think it is necessary to mention the problems and not just the prospects; and to point out the possible danger spots in the year ahead so that Singaporeans would not be caught unaware if a situation turns for the worse and a crisis develops. Mr Speaker, Sir, the Minister has indicated that the Republic is likely to achieve a growth in GNP of between 6 and 8%. In his calculation, I wonder whether certain factors have been taken into consideration. Our economic growth is tied very closely to the performance of the OECD countries. Hence, it is in our interest to take note of a recent report in The Economist which states that, "there are reasons to suspect that prospects for the world economy are not as mildly rosy as the consensus predicts." The OECD countries are only likely to achieve growth rates of between 0 and 7%: Japan 7%, U.S. 4 1/2 - 5 1/2%, Germany 2 1/4 - 5 1/2%, France 4%, Britain 1 1/2% and Italy 0%. And even these expected performances have to be measured against the effects of certain events, including growing unemployment in Western Europe, continuing high inflation, economic strain between the EEC and Japan. slowdown in the oversea investments and the most severe winter in the history of the U.S. Further, there is the prospect of another increase in the oil price. According to the President of OPEC. the two-tier price system may not hold but any compromise solution would be "somewhere in the middle" between the 10 plus 5% decreed by eleven of the OPEC members and the one time 5% raise imposed by Saudi Arabia and the United Arab Emirates. Another complicating factor is the Arab-Israeli conflict and the commitment of the OPEC countries to provide assistance to the Arab confrontation states. Mr Speaker, Sir, I have mentioned these matters merely to reiterate the need for caution in our expectation of high economic growth. Our economic future is determined not only by the Government financial policy but also by the political, social and economic developments in the world at large. The Minister mentioned in his Budget Statement the "modest beginnings in ASEAN economic cooperation" and he gave the examples of the five ASEAN industrial projects and the Preferential Trading Arrangement. I am not quite certain what the stage of implementation of each of these projects is; nevertheless. I am in full support of all these efforts. However, there is one area of ASEAN activity which the Minister failed to mention, namely, ASEAN's economic relations with other countries, in particular the industrial states, namely, the U.S., Japan and the EEC. According to a recent study, the ASEAN countries in 1974 took up only 2.9% of the world trade: the ASEAN countries exported 83% of the world's natural rubber, 80% of its palm oil. 68% of its' tin and 67% of its copra and coconut products. In that year, 61 .9% of their total exports and 57.5% of their total imports were with the industrial countries. Thus, it would seem to me that there is scope for the expansion of trade between ASEAN and the world, and that there is need to consolidate and expand ASEAN's trade with the industrial states. In this connection, I welcome the ASEAN initiatives to hold separate discussions between the regional organisation and the United States, Japan and the EEC. The reality of economic life of ASEAN is the fact of interdependence between them and the industrial states. ASEAN depends on the industrial countries for capital. technology and equipment and the industrial countries depend on ASEAN for primary commodities and certain manufactured products. Besides consolidating trade with the industrial countries, ASEAN should explore other markets in other parts of the world, including West Asia, Latin America and South and East Asia. On this point, I would like to support the Minister's appeal to the manufacturers, traders, businessmen and if I may add, bankers, to devote more efforts to develop new markets for Singapore's products. Within the region, the recent initiative of the Government in concluding preferential tariff arrangements with the Philippines and Thailand should provide the impetus for the expansion of intra-ASEAN trade. According to the study mentioned above, the overall intra-regional trade in 1974 amounted to only 13% of the ASEAN total trade. I am certain that with the Singapore initiative and the move towards liberalising the present intra-ASEAN trade arrangements. Intra-ASEAN trade would improve, and this would benefit all the members of ASEAN. This would be in line with the ASEAN strategy to develop collective and national resilience to meet the problems confronting the states in ASEAN. Mr Speaker, Sir, it is noticed that the Defence Ministry has the highest allocation for the financial year 1977-78, and this may lead critics to question the need for such expenditure for defence I think the need for a viable defence system for the Republic is imperative in view of the uncertain political developments in the region, and the Government must shoulder the responsibility to maintain a level of defence sufficient to meet any eventuality. And as far as the expenditure is concerned, it is high in terms of per capita GNP, but it should be pointed out that, in terms of the absolute amount and the size of the military manpower, the Republic spends the least for defence and has the smallest military force in comparison with other countries including all the ASEAN states, This is evident if we examine the Tables# below showing the comparison of defence expenditures and military manpower of the ASEAN states for the years 1972 to 1976. In view of this fact, there should be no hesitation on anyone's part to support the expenditure for the Ministry of Defence. #The Tables read as follows Table I Comparisons of Defence Expenditures 1973 - 1976 (US$ millions) 1973 1974 1975 Total 1973-1975 1976 Indonesia 452 601 1108 2161 N.A. Malaysia 287 311 385 983 353 Philippines 172 312 407 891 410 Singapore 210 363 344 817 340 Thailand 358 430 542 1330 N.A. * Exclude foreign military assistance to Indonesia, Malaysia, Philippines and Thailand Table II Comparisons of Military Manpower 1972 -1976 (in thousands)* 1972 1973 1974 1975 1976 Indonesia 317.0 322.0 270.0 266.0 246.0 Malaysia 50.5 56.0 66.2 61.1 62.3 Philippines 31.0 42.7 55.0 67.0 78.0 Singapore 17.1 20.6 21.7 30.0 31.0 Thailand 150.0 180.0 195.0 204.0 210.0 * Numbers in Armed Forces, excluding reservists and para-military forces. Source: The International Institute for Strategic Studies. The Military Balance 1976-77, London, 1976. pp 79 and 81 Finally, Mr Speaker, Sir, I hope that the small tax increases on tobacco. cigarettes and intoxicating liquors will achieve the objective of discouraging the habitual smokers and drinkers from continuing these undesirable practices. To derive more revenue, I suggest the Minister should look into the possibility of imposing new or increased taxes on certain entertainment establishments, especially the nightclubs. Such an imposition will not only tax those who can pay, namely, the rich tourists, businessmen and executives on expense accounts but hopefully, it will also deter Singaporeans from frequenting such places. In conclusion, I would like to join my colleagues in the House in supporting the Motion standing in the name of the Minister for Finance. 5.26 p.m.

(In Mandarin): Mr Speaker, Sir, the 1973 oil embargo and the quadrupling of oil prices brought about in 1974 and in 1975 world economic recession, production decline and trade stagnation. There was a widespread decline in the economic growth of advanced countries in the world, in some cases there was even zero growth. Although there were signs of recovery from the world economic recession. in the first half of 1976 there was fear amongst the major industrial countries that too rapid a recovery might spark off another spate of inflation resulting in their taking preventive measures. Consequently, there was slower economic growth in the second half of 1976. Against this background it is encouraging to note that the Minister for Finance has reported a 7% economic growth in 1976 in his Budget Statement announced on the 28th of last month. Mr Speaker, Sir, after the war the sophisticated but high profit new industries like the oil industry, the petro-chemical industry and the electronic industry in the advanced countries have been fully developed. As a result of rising costs of raw materials and energy coupled with the growth in population, the costs of production have mounted and because of the growth in population consumption has been greater. With this trend there is going to be a shortage of raw materials if there is no recycling of used materials. So it will be quite impossible for the advanced countries to reach a double digit economic growth in the years to come. It will also be quite difficult for Singapore to achieve fast economic growth as in the early 70s. Mr Speaker, Sir, over the past decade there have been industrialisation efforts in Singapore. But in the earlier stages of industrialisation the programme was carried out on a smaller scale and the production was meant only for consumption in Singapore and Malaysia. It had also been based mainly on light industries, such as food processing and the production of consumer goods. It is only in the recent four or five years that our industrialisation has entered a new phase, both in terms of capital and technology. We have since made great improvements quantitatively and qualitatively and our products have been exported to Southeast Asian countries. EEC countries and other parts of the world. But, unfortunately, the greater part of the capital and factories in Singapore are in the hands of foreign entrepreneurs. Local entrepreneurs take only a very minor place in our industries, although the Economic Development Board has an office on the promotion of joint ventures. where it collects and distributes information and data and renders assistance to prospective investors in joint ventures in order to promote our economic growth. But how many projects have materialised and are running smoothly under this scheme? I do not know. Local entrepreneurs do not seem to play a great part under the scheme. So our main task in the long-term interest of Singapore is to try and encourage more local capital to take the place of foreign capital in the major industrial sectors of Singapore. Sir, no country in the world can remain isolated in its economic development by depending solely on its resources, natural or manpowerwise. It will also have to depend on external sources. For example. industrial powers like Japan and West Germany have in the short space of 20-30 years after the War relied gainfully on the supply of foreign capital and technological knowhow, coupled with the hard work and the assiduous learning of their peoples to become advanced industrial countries in the world. Sir, capital is an important factor in generating economic development. Therefore, for our continued economic development, we must create a favourable investment climate for our industries, just as the Minister has suggested in his Budget statement a third item of tax concession to strengthen our position as a financial centre to attract more capital to stimulate our economic development. Sir, we must also change the traditional investment habit of our local entrepreneurs. We have to inject more confidence in our local people for investments in our industries and provide the necessary service and safeguard relating thereto. After more than three years of very serious economic recession, even developed countries as well as developing countries in the world are taking proper steps to stimulate their domestic economy and to cut down unemployment. So they step up their efforts in export in order to increase foreign exchange earning. Therefore, competition has been very keen in the world markets. In order to keep the competitiveness of our economy in the world markets, we should improve the quality of our products, raise our labour productivity and cut down on production costs. In this way, we will be able to produce cheaply and compete effectively in the world market. In addition, we must also launch an offensive to get into hitherto neglected markets. including the oil producing countries. There is, therefore, the need to step up a national export bureau to provide co-ordination in our export activities and to take charge of all services related thereto such as tariff exemption. export capital transference, export credit insurance, information collection, data dissemination, market research. etc. There should be more incentives and facilities to be provided for export promotion. Mr Speaker, Sir, we should have this national export bureau to provide our local industrialists and traders services and information and data to enable them to better understand the potential world markets so that they will be better equipped in their efforts to promote exports. This is a matter for immediate attention. Sir, because we have international trade we are vulnerable to changes in the world economy, and therefore our industrialists and management must be able to make a quick and immediate response to changes in the world economy. There should be more flexibility in our economy so that we will be able to weather through difficult situations that may arise in the horizon. We should have this kind of able management personnel who would be able to handle our future commercial and industrial affairs and successfully develop further our economy. Sir, following the greater economic cooperation among the ASEAN countries, there has been more commercial and industrial development in this region. Consequently, there is a greater need for more capital, industrial aid, managerial and technological knowhow. consultancy service, economic research and other services. This will further develop our financial and other services enhancing our financial position. As technical training and communication services will develop into new dimensions in this world, we should be able to make the best use of our existing infrastructure and other facilities in Singapore to assist in the mutual economic development of Southeast Asia. We can become a kind of financial and service centre or a factor for the development of economic prosperity and political stability in this region. In this way, we will not only be able to bring more wealth to Singapore but also provide better life for our people. Sir, the total expenditure of the new financial year comes to $5,459 million with a deficit of $1,500 million. According to the Finance Minister, from this figure, we have earmarked $2,708 million for development purposes, to assist and stimulate our economic recovery. For the new financial year the total revenue of about $3,362 million will be sufficient to cover current expenditure. He further points out that we have already laid a sound foundation for our long term economic development and for a 6 - 8% economic growth rate in the coming financial year. I hope that our financial position will move ever onward, and I also like to express my support on behalf of my constituents for the Minister's Budget for the new financial year. 5.38 p.m.

(In Malay): Mr Speaker, Sir, 1976 saw an improvement in the world economy, a very encouraging situation compared to that prevailing in 1974 and 1975 when an increase in the price of oil had adversely affected the economies of not only the developing countries but also the advanced countries of the world. The rate of inflation for 1976 has shown that even countries with strong economies, such as the OECD countries, are still experiencing an inflation rate of about 8%. In fact, there are certain countries which have an inflation rate of 30%, such as Egypt, while some other countries like Nigeria even have a frightening inflation rate which rises to a peak of 40%. Meanwhile, we can also see how the industrial countries in the OECD which are experiencing an inflation rate of 8% can still achieve a real growth rate of 5%. The United States particularly has moved one step ahead when the Chairman of its Council of Economic Advisers, Mr Charles Schultz, predicted a GNP growth rate of between 5.5% and 6% for 1977. It is certainly our hope that the growth rate in Western Europe and Japan for 1977 will also surpass the growth rate for last year because should this happen. stability would be brought about in the economic situation of the world as a whole. Sir, in the 1977 financial statement our Minister for Finance has predicted that "barring major upheavals in the world economy, we should be able to achieve an annual growth rate of 6 to 8%." This is an optimistic prediction. In his concluding remarks, the Finance Minister stated: [In English] `We have weathered severe economic storms in the last 3 1/2 years. I hope nothing as shocking as the 1973 oil embargo and quadrupling of oil prices ever happens again. The weather is getting fine and fair and our Ship of State is in good shape The command should therefore be "Steady as she goes." [In Malay] Actually, the hopes expressed by the Minister represent the universal hope of mankind at large. But only the human race understands how complex the human mind is. Human beings have spent billions of dollars on arms for various reasons, including the object of interfering in the affairs of others and breaching the peace. thereby causing those countries to resort to no other course of action but to prepare themselves for possible attacks so as not to be caught napping. In this connection, the former Chairman of the Food and Agriculture Organisation of the United Nations, Dr Eugene Castro, made a statement. (Dr Eugene Castro has no relations with Dr Fidel Castro; should somebody want to write a book on a comparative study of both men. which I think will make interesting reading.) In his statement Dr Eugene Castro says that what he is troubled with is that should this world be free of war and there is no chaos, he is confident that the world will be able to support 10 times the world population of today in respect of food. This is a statement made more than 10 years ago and the complex situation of mankind is still continuing. And now oil has become a weapon. Industrial countries like Japan with their economic miracle were also affected when the price of oil increased in the 1973-75 period because Japan. for instance, could not reduce the salaries of its workers so as to strike a balance with the increase in the cost of oil imports. I feel, Mr Speaker, Sir, that the prediction of the Finance Minister about the 6-8% economic growth is very moderate. I think we can accept this cautiously, extra cautious in fact, or rather with `cautious optimism.' We know that whatever happens in the United States, Western Europe or Japan, it will affect us. We also know that the increase in the price of oil will adversely affect us. Sir, another matter which is closer to home is that whether we like it or not two blocs have emerged in this region. One bloc is the Communist bloc of the Indo-Chinese countries (Vietnam, Cambodia and Laos) and the other bloc, including us, is ASEAN. We can see that what has been going on in the Thai-Malaysian border is not a healthy sign. All these matters, including peace and stability in Singapore, will be an important factor in determining whether our Minister's hopes and predictions will materialise or otherwise. While all these matters should be watched by us closely, I feel that other positive measures should be taken. Firstly, our bilateral agreements with the Philippines and Thailand for a 10% tariff cut should be made a reality and extended to all ASEAN countries. Secondly. having achieved that, efforts should be made for a similar situation to be created between ASEAN on the one hand and Australia and New Zealand on the other. I feel that there are many similarities between us that can create better understanding which in the final analysis will benefit all sides. Thirdly, while in the economic field we must consolidate our strength. we must make efforts in politics so that this region, in particular, could fulfil the aspiration of the human race, namely, to live in peace, in mutual respect for each other's rights and settling problems with peaceful means and not through interference with the affairs of others or through conflicts or minor wars, killings and murders. Until now, people are asking whether we are good ancestors for future generations to take example from. I feel that this question can only be answered by making self-corrections. We must correct ourselves first. All human beings should correct themselves before putting the blame on others. I would like to quote from a Chinese proverb: "We point one finger at others but three fingers are pointing at us." If a Malay were to point at someone in a polite manner, he would do it with his thumb. In this manner, we find that four fingers would be pointing at our own self. Mr Speaker, Sir, I support the Government's policy for this fiscal year. 5.50 p.m.

Mr Speaker, Sir, the Finance Minister in his Budget Speech summarised our basic strategy to meet the uncertainties and difficulties in the next few years when he said that we need a flexible approach in our development policy. Changes in the region and in the major industrialised countries will require us to change our own policies and priorities. The problem is how to get such changes in priorities to be reflected quickly and effectively in the actions of the civil service and other public services. During the high growth years between 1968 and 1973. the economy grew at an average rate of 15% and the manufacturing sector grew at a rate of 20%. (All these figures are in real terms.) It was natural, therefore, that goals other than rapid employment creation and high growth began to gain emphasis. We began to discourage labour intensive operations and laid greater emphasis on skilled labour and capital intensive industries. We began to be more particular about where each type of industry should be located. We set higher targets and demanded greater margins of safety in anti-pollution measures, industrial safety and health measures and so on. We did such a good job in some areas, for example, in discouraging labour-intensive operations that we now have to put in extra efforts to convince potential investors that there is a change in approach and that any viable export oriented industry will be welcome, With the change in the international economic environment we have to restate our order of priorities and convey this to potential investors as well as those in the civil and public services who have something to do with investments, be it in manufacturing, construction or service activities. I think that there is not sufficient appreciation of the difficulties involved in achieving even the modest growth rate targetted for 1977. Those who are in the field trying to attract new investment know only too well how much times have changed. Unfortunately. the great sense of urgency and unity of purpose that characterised the administration up to the end of the 1960s and that enabled us to take such effective advantage of the boom years in the international economy seem to have faded away. We now have departments and services who are more concerned with their own immediate objectives. If the performance of such departments is even partly measured by the income they generate, the profit motive tends to become supreme. That department head who has the wider interest of the economy and who is prepared to yield the immediate maximisation of his own objectives becomes known generally as being soft-headed or weak. Moreover, if something does go wrong as a result of his flexibility, those who press for the flexibility will not be around to carry the can. In hindsight when things go wrong flexibility can easily be made to appear as stupidity. Is it any wonder then why some departments stick firmly to their own narrow objectives and are inflexible in their approach? The problem therefore is how to achieve flexibility in administration to ensure that some of the objectives that became feasible in high growth years are now re examined and modified. It appears to me that some instrument must be found at a supra ministry level that can weigh the different aspects, set new order of priorities and make decisions when such problems arise. The Economic Activation Committee comprising very senior civil servants seems to be ideal for this. It does not have any decision-making powers at present. It should be reconstituted and delegated some decision-making powers. The EAC can then, on the basis of actual cases presented before it, formulate changes in approach, in emphasis, in order of priorities and override or confirm individual department's views and communicate these to the departments and services concerned through the decisions it makes on such cases. It may even be necessary to have a committee of two or three Ministers who can perform a similar function on those matters which are considered to be too sensitive to be delegated down to a committee of civil servants. These measures will greatly speed up implementation of investment decisions not only in manufacturing but also in other fields. I think this is very essential if we are not to frustrate investment promotion efforts or spend inordinate time and effort trying to convince various government departments on the need to be flexible when such time and effort should in fact be spent in working on potential investors to commit themselves to investment in Singapore. Having with much difficulty led the proverbial horse to the water we should not be pulling away the trough when it wants to drink. Another matter that should receive more attention and which has been touched upon by the Member for Ang Mo Kio is the promotion of a class of local entrepreneurs who can compete successfully in the international market. Firms controlled and managed by local entrepreneurs probably account for about 45% of the workers employed and about 30 to 35% of the output and value added respectively of the industries covered in the Census of Industrial Production. But these firms account for only about 1 5% of the direct exports, although there are, of course, some indirect exports. Those who have followed the progress of our industrialisation know that very little local entrepreneurship has emerged that is able to make a mark in the export market. It is quite logical that those with ready foreign markets have been the target of our industrial promotion policy. We have rightly concentrated on attracting foreign investors. We should continue to do so and make it attractive for foreign investors to operate in Singapore because it is to our mutual advantage. But I think that at the same time it is necessary also to build up the share in our export industries which is controlled and managed by local entrepreneurs. A look at Hong Kong with an export economy similar to ours will show how far we lag in the participation of local entrepreneurs in the export manufacturing sector. There are reasons, of course, for Hong Kong's lead in this respect. Firstly they had a group of refugee entrepreneurs from China and, secondly, many with potential to become professionals and administrators often found that the only avenue for their talents was for them to start something of their own. In the next few years. many of our own professionals who have been working in foreign owned and managed firms would have had about 10 years or more experience in their jobs. A few may be prepared to strike out on their own and set up their own small manufacturing operations for export. How can we help them to get established? Government should study this problem, firstly to find out in which areas assistance can be most effectively given and set up a scheme to provide such assistance. The need may be in any one of the areas of capital. introduction to firms with technical know-how, training of workers, information about markets, etc. I say any one of these areas because if a would-be entrepreneur is lacking in all or most areas, no scheme can help him and in fact the use of public resources in such instances cannot be justified. I am afraid that with the success we have had in attracting foreign investment this aspect has been relegated to the background. I would urge the Ministry of Finance to give the subject more consideration. 5.57 p.m.

(In Mandarin): Sir, on 28th February which was the 11th day of the first month of the Year of the Snake, which was still during the New Year season, the Minister for Finance brought a piece of good news to the people of Singapore. Apart from tax increases on liquor, tobacco and cigarettes, there have been no new taxes. Instead there are four tax concessions. This has enabled the people of Singapore to enjoy another year without painful increases in taxes. This shows that our Finance Minister is a person whom we can trust. He is a man who keeps his words of not raising taxes and he has now brought good prospects for the people. As a matter of fact, people are very sensitive and alert whenever the Budget is to be presented, because any new tax will have immediate effect on the people. Therefore, on that day when the Budget was to be presented, the ROV was crowded with people who wanted to pay their road tax or to apply for new road licences. Some sensitive merchants were also trying to hoard tobacco and liquor in order to make more profit before new taxes were announced. All this shows that the people are quite acquainted with the parliamentary process. They are just like frightened birds whenever the budget is about to be presented. They are nervous and worried that new taxes will be imposed. Therefore, the budget which was presented by the Minister has been a relief to the people. This manner of budgetting with the welfare of the people in mind is laudable and will generally be welcomed by the people. Without doubt the five basic elements of our long term development strategy for a sustained growth as announced by the Minister five years ago is realistic and feasible, It serves as a guideline for our economic development and points the way to our economic modernisation, We all know that because of the Government's good economic policy and strategy, Singapore has been transformed from an entrepot trading centre into a productive, industrialised country with enough employment opportunities for the people. As regards employment figures. as of June last year a total of 870,400 people were gainfully employed, an increase of 4% over the previous year 1975. This shows that we are on the way to economic recovery, and this is very encouraging to all of us.

Order. It is now 6.00 p.m.

Resolved, "That Parliament do now adjourn." - [Mr E. W. Barker] Adjourned accordingly at Six o'clock p.m. to Monday,14th March 1977.

asked the Minister for Finance (a) what was the annual profit of the Singapore Pools (Pte) Ltd during the past five years; and (b) whether his Ministry will use part of the profit to subsidize various constituency sports clubs to promote sports and games or to donate to the building funds of new community centres in those constituencies where fund raising is not easy.

The net profits of Singapore Pools (Pte) Ltd during the past five years were as follows:- FY Profits 71/72 $5,740,543 72/73 $6,873,900 73/74 $7,216,799 74/75 $7,140,818 75/76 $7,444,083 With regard to using the profits of Singapore Pools to finance sports and other activities for the public, it is Government policy and practice to finance Government expenditures out of consolidated revenues. The provision of sports and recreational amenities is a part of the overall services Government provides to the people of Singapore. The organisation responsible for sports facilities and services is the Singapore Sports Council (SSC) which receives an annual grant from Government to help it finance its activities. The grant extended to SSC comes from monies collected as general revenue (including Singapore Pools) and I consider the present financial arrangements satisfactory. They have not prevented the full development of public sports and recreational activities in Singapore. The SSC itself has been extending financial assistance to various sports and recreation organisations which it feels merit support. Capital grants are provided by Government for the construction of community centres. These grants are assessed on the overall requirement, and there is therefore no need, and no greater advantage, on more than one source of financing by Government. Community Centres are intended to serve as a focal point for community participation and involvement and partial financing of the construction of community centres by voluntary public contributions should be encouraged as one form of such participation and involvement.