Hansard, 1986-03-25

Under the provisions of clause 2(d) of Article 46 of the Constitution of the Republic of Singapore, the following Member has been granted permission to be or to remain absent from sittings of Parliament (or any Committee of Parliament to which he has been appointed) for the period stated:- Encik Abbas Abu Amin, PPA (Pasir Panjang) - from 2nd to 25th April, 1986. YEOH GHIM SENG Speaker Parliament of Singapore

The following Question stood on the Order Paper -

To ask the Minister for National Development, in view of the current economic recession, if the Housing and Development Board will consider reducing the service and conservancy fees payable by HDB residents with a view to helping them to tide over this difficult period.

Question No. 1, Sir,

Mr Speaker, Sir, the present service and conservancy fees payable by HDB residents are already subsidized by the HDB. In the last three financial years, expenditure on estate maintenance services exceeded the income derived from the service and conservancy fees by between 18% and 38%. The expenditure can be expected to rise even further in future as there is a shortage 2of labour for such work. On its part, the HDB has stepped up its mechanization programme to reduce the dependence on labour. It has also actively sought the support and cooperation of residents to lower the maintenance costs. Despite these measures, the total expenditure in FY 85/86 is projected at $312 million. At present rates for the service and conservancy fees, the revenue from these fees is estimated at only $220.6 million. The HDB therefore will have to subsidize the $91.4 million shortfall, or about 30% of estates maintenance expenditure. It is therefore not possible for the HDB to reduce the service and conservancy fees.

Sir, will he explain how is it then that the HDB was able to transfer a sum of $42 million from the service and conservancy charges to other subheads sometime in October 1984?

The service and conservancy charges account has been clearly published in the Annual Report. The 1984 Report for FY 1983/84 quite clearly show, that the income derived by the HDB from service and conservancy charges was $158.8 million. That is the published accounts. The expenditure for service and conservancy charges for that FY was $197.5 million. Therefore, there was a deficit of $38.7 million, and this deficit represents 24.4% of income. So it is quite clear from the accounts which are published that a heavy subsidy is provided by the HDB.

Does the Minister not realize, or has he forgotten, that sometime in 1984 (I think, in the last quarter) there was a transfer from service and conservancy fees of a sum like $42 million to paying interest on loans or something, to another subhead? Will the Minister explain how, in view of his statement that the HDB does not collect enough to pay for the maintenance service charges, it was able to transfer this $42 million?

Mr Speaker, Sir, I have already explained that for the financial year in question, the HDB has suffered a deficit of $38.7 million. But if the Member for Anson is interested in detailed accounting, he can write to me and I will give him a written reply.

The following Question stood on the Order Paper -

To ask the Minister for National Development (a) what safety measures are enforced at the Housing and Development Board worksites; and (b) whether the HDB worksites are safe.

Question No. 2, Sir.

Mr Speaker, Sir, the HDB requires its contractors to take stringent safety measures at all its worksites. These include the erection of barricades, working platforms, overhead shelters and the use of metal scaffolds and anti-fall safety nets. Contractors are also required to provide proper fencing to prevent trespassing. In addition, site safety committees which comprise the Board's Safety Officers and the contractors are set up to look into the safety of the workers. All construction workers are also required to attend safety orientation courses conducted by the National Productivity Board. To ensure compliance of these safety standards, the Board's Safety Officers conduct safety inspections of all worksites on a weekly basis. HDB worksites are very safe. Accident records kept by HDB show that the safety of its worksites is comparable to those of developed countries, such as Japan and the UK.

Sir, is it true that HDB workers work seven days a week, including Sundays, whereas workers at private developer's sites do not work on Sundays?

Mr Speaker, Sir, HDB does not restrict the contractors' working days. If the contractors choose to work seven days a week, thereby speeding up the construction and reducing their construction cost, HDB will not stop them from doing so.

Does the Minister not consider working seven days a week non-stop will enhance the danger hazards to workers?

Mr Speaker, Sir, from HDB records, this assumption is untrue.

The following Question stood on the Order Paper -

To ask the Minister for National Development whether applicants, who have deferred their purchase of Housing and Development Board flats because of the current economic downturn, will be penalized by the policy on cancellation of their application after three selections, and whether this will force them to take up unpopular flats in New Towns.

Question No. 3, Sir.

Mr Speaker, Sir, the policy of allowing an applicant three offers of selection of flats before his application is cancelled is not implemented to force applicants to buy flats in unpopular areas. It is, in fact, similar to the policy of allowing an applicant three balloting chances when flats were allocated through the balloting system. With the acceleration of the building programme, more flats are being completed for sale. Applicants on the waiting list have become more choosy. In spite of repeated invitations by the HDB to select their flats, some of the applicants have not responded, while others simply reject the flats after their selection. This has delayed the allocation of flats to applicants who are lower down on the waiting list. The HDB therefore has to bring back the 3-offer policy to speed up the allocation. Under this policy, applicants are still given ample opportunities to select a flat of their own choice. An invitation to select is deemed as an offer, only if the applicant's position in the selection queue is within 50% of the number of new flats available for selection. Invitations to select reserved flats are not counted as offers. The HDB is aware that under the present economic conditions in Yishun New Town, there are some applicants who are not ready to purchase flats. Such applicants can request the HDB to defer allocation of their flats for one year.

asked the Minister for Communications and Information whether there are plans to set up a post office in Yishun New Town.

Sir, I am answering on behalf of my Minister. Sir, I am pleased to inform the Member for Nee Soon that a temporary post office, beside Block 293 Yishun Street 22, will be opened by May 1986 to provide postal service to the residents in Yishun. A new post office will be opened in Yishun when office facilities are available by the end of this year. This post office will be situated in Yishun Neighbourhood Centre 2, at Block 293 Yishun Street 22. As more housing blocks are completed, additional post offices will be set up. It is envisaged that by 1989/90 there will be a total of four post offices serving all the residents of Yishun New Town.

Sir, may I ask the Senior Parliamentary Secretary where will the four additional post offices be sited?

Sir, altogether there will be four post offices in Yishun New Town. I have named one in my answer just now. The other three post offices will be situated at Yishun Neighbourhood Centre 8, Yishun Town Centre, and Yishun Neighbourhood Centre 4. They are expected to be completed in the year 1987, 1988 and 1989 respectively.

asked the Minister for Communications and Information what are the plans to improve the bus services in Yishun New Town.

Sir, I shall ask SBS to outline the plans for improvement of services for Yishun New Town, to the Member for Nee Soon. In addition, I shall also ask SBS to liaise closely with the Member and his community leaders in future changes of bus routes, with a view to improving bus services in Yishun for the benefit of the residents.

Sir, does the Senior Parliamentary Secretary know that Yishun New Town is not served by SBS but is served by TIBS?

In that case, Sir, I shall ask TIBS to look into the Member's problem.

asked the Minister for Home Affairs (a) if there is any sign that students have been systematically recruited by secret societies; (b) what is the number of students involved in gang fights and other secret society activities since the beginning of 1984 up to the latest convenient date; and (c) what steps have been or will be taken to protect innocent students from being used or harassed by members of the secret societies.

Mr Speaker, Sir, I am answering on behalf of my Minister. Sir, there is no evidence whatsoever of any systematic recruitment of students by secret societies. A total of 13 secret society incidents (ie, gang fights) were reported during the period 1984 and up to 15 March 1986. Twelve students were involved in three of these incidents. The Police conducted a number of activities to prevent student involvement in secret society activities. A programme of talks to primary and secondary schools by officers of the Secret Societies Branch of the CID has been going on for several years. The objective of these talks is to make students aware of the nature, the form and the evils of secret societies, with particular emphasis on secret society recruitment methods. An average of eight such talks are delivered each month. Officers of the Secret Societies Branch also keep in touch with school principals and discipline masters so that feedback can be received on problems such as harassment of students by secret society members. When such feedback is received, action is taken to nip the problem in the bud. When there is evidence to suggest that students are becoming or have become involved in secret society activities without actual involvement in serious incidents, action is immediately taken to call up the students concerned to the CID for counselling and advice in the presence of their parents. Follow-up action is also taken to monitor the subsequent activities of the students concerned.

Sir, are the 12 students in question members of secret societies?

Sir, the fact that they were involved in three of the secret society incidents over the last few years indicate that they are members of secret societies.

asked the Acting Minister for Trade and Industry how many foreign investors had re-located their manufacturing plants from Singapore in the years 1983, 1984 and 1985.

Mr Speaker, Sir, in the last few years, leading international companies which have relocated at least a part of their operations elsewhere include General Electric, Philips, Hitachi Consumer Products, NMB, European Standard Electronics, Hewlett Packard, National Semiconductor and Seagate Technology. Most cases involve transfer of Singapore operations to countries which have cheaper and more plentiful supplies of labour. Fortunately, most of them have retained or diversified into higher value operations in Singapore. Some, however, have closed their Singapore plants and consolidated their activities here back to their home countries. Relocations involving labour-intensive operations are perhaps inevitable. We can no longer compete on the basis of cheap, unskilled labour. But companies engaged in high value and skill-intensive operations, which provide good jobs for our people, must not be priced out of the international market because of increases in domestic costs, particularly wage costs. To attract and retain these companies, we must maintain our cost competitiveness. We must ensure that even when companies relocate the labour-intensive portion of their operations overseas, they can upgrade and retain their activities in Singapore, either through automation or by introducing new and more sophisticated product lines.

Sir, in view of its importance to our economy, will the Acting Minister include a report on this item in future Economic Surveys? At the moment, the Economic Survey does not include a report on loss of investments to Singapore.

Mr Speaker, Sir, we will consider that, and we will present it in the form of a progress of the upgrading of our economy.

asked the Acting Minister for Trade and Industry what measures are being taken to improve M/1/3 upon the quality of economic forecasting and also to provide the latest economic data.

Mr Speaker, Sir, to improve our economic forecasting, the Department of Statistics is developing an index of leading indicators. This index is meant to give us early warning of economic downturns and recoveries. At the same time, the Ministry of Trade and Industry is setting up a new Economic Research Unit. This Unit will develop an econometric model of the Singapore economy. The model will be useful not only in forecasting the likely performance of the economy, but also in working out the probable effects of different economic policies. Lest I raise unrealistic expectations, let me caution that no econometric model, or indeed any forecasting tool or technique, can be completely reliable. It is particularly difficult to predict the performance of a small, open economy such as ours. The external influences on its course are dominant, and can never all be infallibly foreseen. New techniques will only improve our forecasts if they are supplemented by good feedback and informed business judgments. MTI will therefore continue to give weight to our surveys, such as the Survey of Business Expectations, and the feedback through agencies such as the EDB and the TDB. At the same time, we will also improve on our statistical publications to make them more timely, accurate, comprehensive and useful. I would therefore urge private sector firms and businessmen to respond promptly and accurately to our surveys. I would also like to encourage firms, industry groups, chambers of commerce, and also academic economists, to publish more independent analyses of our economy. This will reduce the risk of basing plans and policies on only one set of forecasts. Finally, the latest statistics on the state of the economy. Based on data for the month of January, which is the latest available, MTI preliminary estimates are that GDP in the first quarter of this year is likely to be 4% lower than the first quarter of last year. Several key sectors, notably manufacturing, construction and commerce, are still declining. This comes after a 5% decline in the last quarter of 1985. The economy therefore still shows few signs of recovery.

Sir, will the Acting Minister promise to release all data that are required by academic economists and others who wish to analyze the state of the Singapore economy?

Mr Speaker, Sir, all data which can be released without detriment to the public interest will be released.

Sir, could the Acting Minister tell us how often will the economic indicators and data be made available to the public?

Sir, the index of leading indicators is just in the process of being developed and validated. I think it will be a few months before we are confident that it works. In fact, we would not be certain until it has predicted several turning points successfully. We will release the data quarterly, the same way as we have been releasing GDP statistics quarterly, and as promptly as we can. And if it is necessary, we will do it more often. But there is a cost to producing data more frequently than that.

Sir, will the Acting Minister indicate the timeframe by which this econometric model will reflect the future of our economy accurately?

Mr Speaker, Sir, we hope that as time goes on, our econometric model will become more and more accurate. We also hope that within a year or two, it will able to make useable predictions. However, if the Member for Radin Mas has read the reports of the forecasts of the US economy, which are regularly published in great profusion, and which are based on extremely sophisticated and complex econometric models, he will understand that no matter how elaborate the model or how sophisticated the computer you use, there is still a very large degree of uncertainty involved in predicting the future of an economy.

Sir, that is precisely the point, because we may be relying on a model that makes the public expect too much. And this is the fear that I have.

Mr Speaker, Sir, that is precisely the reason why we are not ready to release the model yet.

Sir, has the Acting Minister any intention to introduce statistics called flash estimates that have been used in the US which give advance notice as to how the economy is performing?

Mr Speaker, Sir, the January statistics which I just gave you constitute a flash estimate. Flash estimates are not very reliable. They give you a quick first-feel. If need be, particularly at critical times, we will release them.

asked the Acting Minister for Trade and Industry (a) what is the projected occupancy rate for hotels and number of tourist arrivals for 1986, 1987 and 1988; (b) what measures have been taken to promote tourism; and (c) what is the latest status of tourist development projects.

Mr Speaker, Sir, I am answering on behalf of my Minister. The projection for tourist arrivals in 1986 is 3.13 million; for 1987, 3.25 million; and for 1988, 3.41 million. As the number of hotel rooms in Singapore will still be increasing rapidly over the next few years, the Singapore Tourist Promotion Board projects that the occupancy rate of hotels will probably decline from 55% in 1986 to 50% in 1988. To promote tourism, the Singapore Tourist Promotion Board will step up its marketing and product development efforts. Over the next three years, STPB will spend about $22 million annually to promote Singapore as a tourist destination in key markets in Asia, Europe, North America and Oceania. These are markets which have been identified to have growth potential. STPB's strategy is to concentrate on promotion efforts that will achieve immediate results. New programmes have been drawn up to achieve this. These include direct marketing techniques, joint promotions with overseas tour operators and wholesalers, and a world-wide advertising and public relations programme. STPB will also bid for more and bigger conventions and meetings to be held in Singapore. It has identified over 200 such meetings in the next two years. It will bid for these with the help of local professional associations. Some of these conventions involve as many as 10,000 delegates. The total number of overseas participants in convention-related events is expected to reach about 200,000 in 1986, an increase of 13-14% over 1985. The other important area is product development, which is the development of tourist attractions in Singapore. STPB will accelerate development projects which will stimulate more tourist arrivals, in par- ticular those which generate repeat visits, and also extend visitors' length of stay. This will include recreating elements that give Singapore its charm and mystique. The aim is to create a stronger image for Singapore as an attractive value-for-money tourist destination. Projects in the pipeline include the enhancement of existing attractions such as Haw Par Villa, Singapore River, Fort Canning Park and Sentosa. In addition, projects are being undertaken to conserve and revitalize historical sites such as Chinatown, Little India, Kampong Glam and the colonial city centre. In the long term, a possible new key attraction will be a theme park.

Mr Speaker, Sir, two supplementary questions. (1) Will expenses incurred in promoting tourism overseas by individual hotels or the Singapore Hotel Association be made tax deductible? (2) Is there any plan to develop a beach resort in view of the proposed closure of Apollo Sentosa?

Mr Speaker, Sir, regarding the tax deductibility of promotion expenses incurred by hotels for overseas promotional exercise, I think this matter will have to be taken up with the Finance Ministry. But the Singapore Tourist Promotion Board will render the necessary assistance or other organizational support to help individual hotel owners who want to make promotional efforts in overseas markets. As to the development of a beach resort on Sentosa island itself, this is one of the key areas which STPB will be focussing its effort. Actually the intention is to enhance the beach resort facility on Sentosa island itself and to promote the development of a first-class beach resort together with a hotel.

Would the Minister of State agree that a multi-racial and multi-cultural society is an attraction to tourists? If so, what are the plans to preserve temples and other religious buildings as well as names of streets, for example, Chinese street names in Chinatown.

Mr Speaker, Sir, I am not aware of any programme to change all the Chinatown Chinese street names to some other foreign names. I believe all the names will be preserved, as they have been for so many years. Regarding the preservation of areas of traditional historical interest, I have already stated in my answer that it is the intention of STPB to help in the development and preservation and the enhancement of areas of Singapore which have a historical interest, such as Chinatown, Little India, Kampong Glam and the colonial city centre. These areas will be retained for their historical value and also as future tourist attractions.

Mr Speaker, Sir, does the STPB monitor the prices of food and drinks in hotels?

Mr Speaker, Sir, yes, STPB does monitor prices that are being charged in hotels and other tourist restaurants. STPB is aware that there has been an occasion where a tourist has complained of over-charging in such tourist outlets. STPB will be investigating this complaint and seeks the cooperation of the restaurant or hotel operators to prevent the recurrence of such over-charging.

Mr Speaker, Sir, I read in the papers that the only hotel in Sentosa, the Apollo Sentosa, is about to close down. Did I hear the Minister of State -

Where is your supplementary question, Mr Chiam?

Did the Minister of State say that the Government intends to build another hotel at the beach resort there in Sentosa?

Apollo Sentosa is going to close down for its own reasons. The Government through the Singapore Tourist Promotion Board will launch a new effort to improve the facilities that are available on Sentosa Island itself. The beach itself will be resurfaced to bring it up to a higher standard. It will be provided with more resort-type facilities in order to make the operation of a resort hotel more viable and the possibility of a commercial success. It has nothing to do with the closure of Apollo Sentosa.

Does the Minister of State have a classification of our hotels according to the star categories, five star, four star, no star, whatever, and the number of rooms in respect of each category?

If the Member for Whampoa would like this information, we can certainly provide him with this classification of hotels and the availability of hotel rooms in Singapore.

Does the Minister of State agree with me that perhaps we have built too many four and five star hotels, and if we are going to promote tourism in the places where people do not have too much money, then we have to provide lower grade hotels?

Mr Speaker, Sir, I do not believe that there is a shortage of economically priced hotels in Singapore, particularly at this moment when many hotels have trimmed their rates. I do not believe it is true that there are tourists who want to come to Singapore and have been deterred from coming, simply because our hotel rates are too high now.

Does the Minister of State foresee the closure of some of these hotels because of lower occupancy rates?

Sir, most of the hotel industries are operating at a fairly low level of occupancy rate and the prediction is that it will continue to drop to 1988. Hotels will have to try their very best to achieve cost reduction in their own operation. They will have to use innovative ideas to attract tourists to stay in those particular hotels. For instance, I am aware of hotels which have organized package stays, including the provision of shopping vouchers. These are techniques that can be used to bring people to fill up the rooms. I think it is necessary for them to continue to exercise their imagination in order to attract visitors.

Does the Minister of State have any idea what is the occupancy rate below which hotels are not viable?

Mr Speaker, Sir, this would depend very much on the type of hotel, when was the hotel built, what was the cost incurred and also how is the hotel being operated? What is the standard of management? There is no uniform industry rate.

May I ask the Minister of State to what extent, if any, does the Singapore Tourist Promotion Board cooperate with the Malaysia Tourist Corporation to sell both countries, as it were, in a package deal to tourists? Sir, they can use Singapore as a stepping off place, spending a day here or two, and then going on to Malaysia or other places.

Mr Speaker, Sir, STPB has been working very closely with the Malaysian Tourism Promotion Authority. We have indeed organized such joint package tours where tourists staying in Singapore can take sight tours to Malaysia. This is constantly being promoted and, as the Member for Anson must be well aware of, we have also explored other opportunities to go into joint tourism development. For instance, the plan to provide a ferry connection between Changi and the Desaru holiday complex is just one of these means of linking up tourist attractions in both countries.

Mr Speaker, Sir, if I may supplement the comments of my Minister of State, with regard to the point raised by the Member for Potong Pasir, as to why we are starting a beach hotel in Sentosa when Apollo Sentosa has just closed down, and with regard to the questions raised by the Member for Whampoa, as to whether we think there are enough two and three star hotels in Singapore and what is the reasonable occupancy rate for hotels. The questions assume that it is the Government's duty to find out the number and do something about it. It is a wrong assumption. Apollo Sentosa has not been viable. It is winding up. Does that mean that Government concludes that we need a hotel, and that we will promote it and fund it? It does not. What the Government will do is to improve the infrastructure on Sentosa - improve the beach so that you will have cleaner sand, wider expanse of sunshine and ocean; improve the facilities, the attractions. Then if anybody comes and says, "Yes, a beach hotel is a viable proposition" and want to venture his money, we will welcome him. If nobody decides to establish a beach hotel, well, so be it. Sentosa will be the poorer. The same goes for two and three star hotels. Are there enough? Well, that is a matter for the market to decide. If entrepreneurs think there are not enough, and that there is money to be made from building two and three star hotels, I think they can be trusted to do so. Indeed, I am surprised to hear an economist suggest to the House that the Government should decide what is necessary and what should be built. I would have thought the experience of the last few years was sufficient caution against such approaches.

Mr Speaker, Sir, will the Acting Minister agree with me that in a recession it is the duty of Government to analyse all the causes behind the recession and to suggest remedial measures? And one of the first things to look at will be the state of the hotel industry. And if the pricing is wrong, the distribution of rooms is wrong according to the star categories, then something should be done about it; perhaps not directly but by informing the hotel sector about it and by preventing further foolishness in future.

Mr Speaker, Sir, we either believe in the invisible hand or we believe in a command economy. If we believe in the invisible hand, then it is the Government's duty to make information available on prices, on occupancy rates, on trends, and it is up to entrepreneurs to decide whether on that basis they want to venture their money. I have had it said to me by a hotel entrepreneur who built a hotel about five years ago, on the strength of the Government's projections of tourist arrivals, "That is all the Government's fault. You said the tourists would come. Now the tourists have not come. I have an empty hotel. So what are you going to do about it?" Well, the answer is, the Government cannot do anything about it. Whatever data we provide, where they are factual, you can take it that we have tried our best to get it right; and where there are projections we have tried our best to look into a cloudy crystal ball. That is all that the Government can assure.

Mr Speaker, Sir, did the Acting Minister hear what his Minister of State stated just now? He said that a hotel together with a beach resort would be developed at Sentosa. That is why I was surprised and I brought up this question in the first place.

Mr Speaker, Sir, part of the master plan for Sentosa comprises a beach hotel and a beach resort. Whether that part of the master plan is realized depends on whether an entrepreneur decides that there is money to be made and that is a viable project. If so, it will be built. If not, there will be none.

asked the Minister for National Development (a) whether the imposition of the age requirement of 29 years will affect the demand of and create problems for those who need rental flats; (b) what are the Housing and Development Board's future plans on these rental flat vacancies; and (c) whether the waitingperiod for rental flats will be shortened.

Mr Speaker, Sir, the imposition of the age requirement of 29 years should reduce the demand for rental flats. However, it will not create problems for those who need them, such as those affected by resettlement or facing genuine hardship. These cases are exempted from the age requirement. The HDB has a programme to redevelop the rental blocks which have been vacated by existing tenants. Under this programme, flats which are vacated by existing tenants will not be reallocated. When more than half of the flats have been vacated, the remaining tenants will be decanted to either home ownership flats or other rental flats. The blocks will then be demolished and the site subsequently redeveloped. Because of the redevelopment programme, many of the vacated flats will not be available for rental. Hence the waiting period for rental flats is not expected to be shortened.

Sir, is the Minister aware that the age requirement causes increasing overcrowding in families of one and two-room flats and whether he will be prepared to waive on a case by case basis, based on pressing problems of such families also?

Mr Speaker, Sir, as I have stated in the House earlier, young people between the age of 21 and 28, have another 20, 30 or even more years of working life. So this group of Singaporeans should be encouraged to become home owners and not be easily provided with rental flats and become entrenched in the rental flats. This will be bad for them and bad for the family.

Is the Minister seriously saying that the policy of the HDB is to keep all rental flats vacated vacant and deny, I do not know how many hundreds, it might be running into thousands, applications for rental flats. What do you expect these people who have applied for rental flats to do?

Mr Speaker, Sir, for those who apply for rental flats who are above 29 years old, they will be allocated a rental flat. I did not say HDB will keep all the rental flats vacant - I said HDB has a redevelopment programme for the rental flats and that does not cover all the rental flats. In other words, rental flats will continue to be available to those who are qualified to apply for rental flats.

asked the Minister for National Development what improvements are being undertaken by the Housing and Development Board to minimize the inconvenience caused to residents as a result of lift breakdowns.

Mr Speaker, Sir, the HDB has implemented a comprehensive maintenance programme for its lifts to minimize the inconvenience to residents caused by lift breakdowns. All lifts are being serviced by the lift companies once every fortnight. The servicing programme includes checking for malfunctioning of all major parts and repairs or replacement of parts where needed. To ensure that the lifts are safe for public use, every lift is tested and certified fit for use annually. In the event that any of the safety devices is found to be faulty, the lift is switched off until the fault is rectified. In addition, a thorough full load test is carried out every five years to ensure that the safety gear is functional and has not deteriorated with age. Old and problematic lifts are either refurbished with new component parts or replaced entirely with new lifts. The lifts are also inspected by HDB Housing and Maintenance Inspectors daily who will report any breakdown or defects to the lift companies. In addition, the Board has successfully developed a telemonitoring system to monitor the performance of the lifts continuously. This system alerts the Board's Lift Maintenance Unit when passengers are trapped in the lift or when the lift is tampered with. However, no amount of improvement would help if the residents do not play their part in the upkeep of the lifts. Every year, thousands of dollars are wasted as a result of acts of vandalism, such as urinating in lift cars, burning of push buttons with cigarette lighter, defacing of car and door panels, etc. I would therefore urge residents to cooperate fully with the Board in observing the proper use of lifts.

asked the Minister for National Development what actions are being taken by the government to make buildings more accessible to the disabled.

Mr Speaker, Sir, in the design of new public buildings, the Public Works Department incorporates amenities for the accessibility of the disabled, where feasible and practical. Ramps, handrails and toilet facilities are provided. These facilities also serve children and the aged. Changi Airport is an example of a complex in which handi- capped people have access. New public libraries also provide accessibility. The HDB has also given consideration to the handicapped. Where physical conditions and cost-effectiveness permit, barrier-free features are provided in HDB estates, such as ramps leading to the lift lobby from footpaths. Recently, additional features have been incorporated for new HDB blocks where physically possible, such as linkages from a block of flats to other parts of the HDB estate. The HDB has also taken administrative measures to assist the disabled. For example, priority is given to them in the selection of ground-floor or lower-floor flats or flats on lift landing floors. Approval is also given for the construction of a ramp outside flats occupied by disabled persons. Flexibility is also exercised in granting ad hoc requests to aid mobility.

asked the Acting Minister for Trade and Industry how many International Purchasing Offices (IPOs) were set up in Singapore in 1984 and 1985, and what steps the government will take to encourage more IPOs to be set up in Singapore.

Mr Speaker, Sir, many foreign trading companies export and import from Singapore. But international purchasing offices, or IPOs, are a special category. IPOs are offices of multinational companies, large chain stores and professional purchasing agents, established here for the sole purpose of buying from Singapore and the region to meet their world-wide or headquarters' needs. They also include foreign companies which, in addition to their manufacturing and sales activities in Singapore, source for their headquarters from Singapore. There are currently about 43 such IPOs in Singapore, 10 of which were set up in 1984 and three in 1985. Their purchases range from electronic components to metal and plastic parts, garments and general merchandise. The Trade Development Board (TDB) has been actively attracting such IPOs to Singapore. Through its overseas offices, TDB will continue to identify large companies and buying organizations in the US, Europe, Japan, India and China. TDB will send missions overseas to demonstrate the range of goods and services available in Singapore. Potential IPOs will be encouraged to visit Singapore and introduced to local suppliers. TDB will also organize regular workshops where IPOs can explore business opportunities with local companies.

asked the Minister for National Development whether the planning and construction of Yishun New Town bus interchange can be expedited in view of the fast increase in the population of the New Town.

Mr Speaker, Sir, the Yishun bus interchange is scheduled for completion in April 1987. The HDB will now expedite its construction and will complete the interchange earlier, if possible. In the meantime, the HDB has provided a temporary bus interchange at the junction of Yishun Central and Yishun Avenue 2 to serve the residents.

"to make new provision in respect of copyright and related matters, and to repeal the United Kingdom Copyright Act 1911, the Copyright Act (Chapter 187 of the Revised Edition) and the Copyright (Gramophone Records and Government Broadcasting) Act (Chapter 188 of the Revised Edition) and to make a consequential amendment to the Singapore Broadcasting Corporation Act 1979 (No. 33 of 1979); and for purposes connected with the matters aforesaid", presented by the Second Minister for Law (Prof. S. Jayakumar); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

Order read for consideration in Committee of Supply [5th Allotted Day].

Announcement by Mr Speaker 11.54 am

I have indicated that in view of the time constraint I would welcome speeches that are brief and sweet. Yet I see that some Members have been making full use of the 10 minutes allowed per amendment. Let us play the game and allow every Member who has filed an amendment to have his or her say and also to allow the Minister concerned to answer fully. Head P (cont) - Resumption of Debate on Question [24th March, 1986], "That the sum to be allocated for Head P be reduced by $10 in respect of Subhead PA-01 Object Group 1100 of the Main Estimates." - [Dr Aline K. Wong]. Question again proposed.

Sir, I shall continue with the remarks on organ transplantation. In 1985, 141 patients with chronic renal failure were presented for treatment at the Renal Unit of the Singapore General Hospital. This represents the demand for kidney transplant operations. On the supply side, in the same year, only eight kidney transplant operations were done. In 1984, 1,109 people died as a result of accidents. Of these, 45 of them were suitable potential organ donors. However, because they had not previously indicated their wish to be organ donors, 90 other people lost the chance for a new kidney and a new life, and if we include heart transplantation for which surgical expertise is also available in Singapore more people could have had a new life. Sir, I wish to urge the Minister to redress this situation by introducing some legislation. Legislation does not need to be compulsory. People who do not wish to donate their organs should they die in an accident can opt out of being organ donors and a register of such persons should be kept and be available at all times before organs are removed. Secondly, certification of brain death should be done by a panel of doctors who are not in any way connected with the transplantation programme. And finally, a lot of time and opportunity should be given to all sectors of the public to express their disapproval or their support or to bring up additional safeguards so that fair provisions be made for everybody's protection but at the same time allow our big problem of organ shortage to be met.

Sir, I have an amendment under the Medisave scheme and I will confine myself to the subject. Sir, as I am paid by Medisave, I think it is in order that I declare my pecuniary interest in the subject. The Medisave Scheme has been implemented in Government hospitals for two years now and in the private hospitals only recently. There have not been many teething problems, as I understand it, and I think this is mainly attributed to the well laid-out groundwork which was carried out before implementation by the First Deputy Prime Minister who was then the Minister for Health. The users of Medisave seem happy with the scheme and I think the main reasons are that they do not have to cough up money from their own pockets to pay the hospital bills and also that they now have both the choice and the means to opt for a better class ward in a Government hospital or even in a private hospital. The saving on their own spending money can be quite substantial. As an example, in the case of childbirth, it will cost about $2,000 to have a baby delivered in a private hospital but the user of Medisave Scheme needs to pay the difference of about $500. So there is a substantial saving of $1,500 from his own pocket. This unrestrained use of the Medisave fund is not what is intended by the Government. One of the basic reasons for not opting for the insurance health scheme is that the Medisave fund, being the user's own savings, will impose upon the user some responsibility on how the fund is to be disposed and will encourage him to put a premium on good health. This has not happened and I do not think it will happen. Singaporeans place a premium on health only when they are sick. They are prepared to spend what they can afford and that includes all the money in their Medisave to restore themselves to good health. This is not really an abuse of the Medisave fund. It is more a misuse and due to a lack of foresight for the need to have a standby fund for future use. I therefore think that it is prudent and I would like to recommend for the Minister's consideration that a maximum limit be set for each hospital admission. I suggest two-thirds of the user's existing fund so that there will always be some fund left in his Medisave Account for future use. And the user is to be made personally responsible if he exceeds the maximum limit. Thus if he wants a better class ward, he must be prepared to pay the extra out of his own pocket. Sir, the subject of abuses of the Medisave scheme is of great public interest. Unlike the insurance health scheme, the Medisave scheme is not as vulnerable and exposed to exploitation and abuse. In fact, I believe there are already safeguards built into the Medisave scheme, for example, the Government has already set a maximum limit for claims for both hospital fees and doctor's fees. I understand that the maximum claims will cover the whole bill in the Government hospital but will probably cover about 70% or less in a private hospital. Contrary to what the Member for Jalan Kayu implied yesterday that people tend to look at Medisave fund as if it was not their money, I do not think this is true. It is true that users are ever ready to make use of their Medisave fund when the need arises but this does not mean that they do not realize that this fund is part of their CPF; after all 3% is deducted from their wage bill. What is more important is that the other parties concerned, ie, the hospital and the doctors, realize that this is not insurance, but that this is the user's savings. The other safeguard is the letter of certification which every doctor has to sign, and this forms a record and a monitoring system on the individual doctor's charges. This will discourage overcharging. As we know, the implementation of the Medisave scheme in the private hospital has brought about a boom in business and up to now, I am glad to provide the feedback to the Minister that there has been no increase in hospital charges for patients in private hospitals. On the whole, Sir, from my own observation, there have been very few abuses or misuses of the Medisave scheme, and if there had been any, they would have been limited. However, this does not mean that the Ministry should be less vigilant over possible abuses. I can think of six possible ways which the Medisave can be abused. First, a patient may connive with a doctor to be hospitalized on a false diagnosis in order to use the Medisave fund, such as for an annual health test and investigation. Secondly, patients who are in hospital may request for a longer stay in hospital although there is no medical indication for it. Thirdly, a doctor may claim for additional operation procedures which were not actually carried out. Fourthly, because of the availability of Medisave fund, there may be a temptation to carry out unnecessary operations or to admit patients to hospitals without a medical reason. Fifthly, in-patients may also request for more tests and more investigations which are not related to the diagnosis and treatment during the hospital admission. Lastly, because of Medisave there is always the possibility that charges of doctors and private hospitals will go up, and the Minister should keep a close monitor on this. I would like to ask the Minister to comment on these possible abuses and to inform us how these can be checked, and what further safeguards he intends to establish.

Mr Speaker, Sir, I will try and be very brief. I have a feeling your remarks were particularly directed to me. May I make another plea for the Ministry of Health, particularly in Hospital Services, not to be too rigid in its efforts to collect charges. I say this because only last week somebody came to see me in my MP's office. He has been out of employment for about nine months, and he has been told that he has got to have an operation. He has got to go into hospital and, on top of this operation that is facing him, he has got his family problems. He was very worried about the hospital charges and the operation charges and all the other investigation charges. I told him, "Look, I think you had better go and have a word with the hospital almoner or medical social worker about your problems. And if you do not get any help there, then perhaps you can come back and see me." This is really the problem that I want to try and place before the Minister for Health and the Hospital Services - that, in this time of recession, there must be hundreds of people who are unable to pay even the basic daily ward fees. They may or may not have enough in their Medisave Account but even if they do have it, perhaps they may not be very anxious to use it all up in the hope that they might be able to rely on it later for their own living expenses. So could I make another plea? I did that the other day and I was told there are other avenues - they can go and use somebody else's Medisave Account or go and ask for assistance somewhere else. May I ask that a more enlightened policy be taken by the hospitals when it comes to, particularly, workers who have been out of employment for six months, nine months, and less anxiety be shown about collection of fees and greater attention given to the needs of the man? Finally, may I ask, why is it not possible for a patient who has to attend at the hospital every day for treatment to pay these charges out of a relative's Medisave Account? I know a man who was not warded in the hospital. Apparently it is his mother, he says, who has to attend at the hospital every day for treatment and he has to pay $10 a day, which amounts to $300 a month. And he wants to use his Medisave Account but he is told he cannot. I do not know why he cannot be allowed to use his Medisave Account because it is almost as though his mother was warded in the hospital getting treatment daily. So could we have a bit of relaxation of rules governing the use of Medisave and the collection of fees to suit the needs of individuals in their circumstances?

Mr Speaker, Sir, though the National University Hospital has been in operation for quite some time, there are still some members of the public, especially those from the neighbouring housing estates, who are not fully aware of the facilities and services available at NUH. Some even think that it is just a teaching University. Could the Ministry or NUH authority consider providing information to the residents in the neighbouring constituencies on the following: (a) Are there A&E services? (b) How many and what classes of hospital beds are available? (c) Are the charges similar to that of other Government hospitals? Perhaps it would be a good idea if grassroots leaders be invited to NUH to have first-hand information about this hospital. Finally, Sir, I would like to know from the Minister whether there are plans to further develop NUH as one of the best in the region, perhaps as a place for research and development in the medical field.

Sir, I would like to raise a few points, fairly quickly. I am concerned about the condition of Toa Payoh General Hospital and its medical and physical facilities. The hospital appears to be congested. It is old. It has served its time. It is now overcrowded, and it is not providing an efficient service for a growing population in the neighbourhood. The residents living in Ang Mo Kio, Toa Payoh and Bishan estates want to know what plans are being taken to develop the Hospital to meet the growing health needs of this population. Sir, on the second area, I am concerned about the increasing admissions of psychiatric patients to Woodbridge Hospital and also the increasing number of discharges of psychiatric patients from the Hospital, as well as the increasing attendances of psychiatric patients at outpatient services. Sir, many of the families are concerned about the quality and the follow-up services provided to such families who are mainly living in housing estates. Most of them are seen for a very short time and they ultimately do not get the required attention. Consequently, many of them get re-admitted again. This revolving door admissions and discharges creates a problem for the family. I am wondering what plans are to be taken to strengthen the outpatient services in the treatment of psychiatric patients. Finally, Sir, on the question of abortion, I share the sentiments of the Member for Whampoa but I am more concerned about the increasing number of teenage abortions. What has been done to help teenagers who seek abortion? What are the types of services available? More importantly, Sir, I feel that family life education programme for young people would be relevant in order that we can prevent such an increase in abortion. I think abortion should be made specifically available to those who seek abortion for a medical condition.

Mr Speaker, Sir, I will respond on behalf of my Minister. Sir, before I proceed to answer the points and questions raised by Members, I would like to give an overview of the broad direction my Ministry will take over the next three to four years. The thrust of my Ministry's programmes will be to lay the foundation for Singapore to develop into a Centre of Medical Excellence. Some people have asked what this involves and how this will benefit Singaporeans. Medical excellence involves the upgrading of standards of health care at all levels, whether it is at primary, secondary or tertiary level. While emphasising the upgrading of standards, my Ministry is committed to the philosophy that prevention of disease is as important as its cure. We will expand our efforts to educate the public on the need for healthy lifestyles and on the responsibility of the individual for his own health. Sir, today two-thirds of primary health care and one-fifth of hospital care are provided by the private sector. The private sector must therefore actively and constructively participate in our endeavour to further improve our nation's health standards. My Ministry will work closely with the academic and professional bodies to achieve this. My Ministry's Health Advi- sory Council has been expanded to include representatives from professional organizations, the University, the private sector, as well as non-doctors. The Council would provide feedback on future directions and developments of the health services in Singapore. Let me now outline some of the major programmes that the Ministry is or will be implementing. To improve the Ministry's primary health care services, 10 new polyclinics will be built over the next five years in the larger new towns. This will allow the phasing out of old outpatient dispensaries and maternal and child health clinics which are small, inefficient and poorly equipped. These new polyclinics will also provide facilities for the care and rehabilitation of the aged. Such health care centres will be run by the Home Nursing Foundation. In fact, two such centres will be opened this coming financial year at Kampong Ubi and at Kuo Chuan. My Ministry will be studying measures to provide a more efficient, effective and higher level of care in the new polyclinics. We will continue with our responsibility of providing primary health services to children, the elderly and the indigent. For those who are in the working age group, my Ministry will take steps to encourage them to use the private sector. I now come to the question of medical excellence at the secondary and tertiary levels. Here, we have to ask ourselves just how much we can hope to achieve. For the small population, we have to provide a limited patient base. With our limited manpower and financial resources, we have to be realistic and set attainable targets. Sir, we cannot hope to achieve excellence in everything but we can be good in some things. We have to set our priorities and decide what to invest in and which areas to specialize in. My Ministry has therefore decided that it will continue to emphasize on the specialities first identified by the Government in 1970 for further development. These are the specialities of cardiothoracic surgery, neurosurgery, plastic surgery, paediatric surgery and renal medicine. We have made significant advances in these areas. I believe that we can do more. My Ministry will concentrate, in particular, on dealing with the two major killers affecting Singaporeans today, namely, heart diseases and cancer. Special multi-disciplinary task forces have been set up to look into all aspects of these two disease conditions. They will shortly make recommendations to the Ministry on the strategies to be adopted and the developments needed to contain the rapidly increasing incidence of these two diseases. Members of this House will therefore note that to achieve medical excellence, we will need to upgrade the general standard of medical practice in Singapore and in the areas which affect Singaporeans most. It will benefit all Singaporeans. In the process, some foreigners will come to train or to work in Singapore. Others will come for treatment and all these will benefit the economy as well. Before we can hope to achieve any of the above, we must restructure our hospitals to give them autonomy and flexibility. They must be given management flexibility to allow them to innovate, motivate their staff and achieve greater efficiencies while providing good personalized services. The National University Hospital (NUH) was the first hospital to undergo this pilot project of restructuring. We are monitoring the performance closely and we hope to learn some valuable lessons from it. We are now studying the possibility of restructuring the Singapore General Hospital. The exact form it would take and the timeframe have not been decided. But it will probably take at least two or three years before it can be brought about. As for the other acute hospitals, the Ministry recognizes the need to upgrade the physical facilities first before they can be restructured. The Ministry is planning to redevelop in phases Toa Payoh Hospital, Tan Tock Seng Hospital and Kandang Kerbau Hospital over the next 5-10 years. Facilities or services like the accidents and emergency departments, specialist outpatient clinics, operating theatres and intensive care units will be upgraded if they are presently inadequate or substandard. Adequate numbers of the subsidized B2 and C class wards will be retained to meet the needs of the lower-income group. Mr Speaker, Sir, the redevelopment and building of new hospitals and polyclinics will cost large sums of money. Modern diseases are more complex and difficult to diagnose and treat. They often require sophisticated equipment which can be very expensive. For example, a computer tomography scanner can cost up to $2.7 million each. Higher level support staff are also needed to operate and maintain such machines and systems. Our health costs have gone up significantly, increasing seven-fold from $57.4 million in 1970 to $506.8 million 1985. Last year, the subsidy level for health services was 73% which works out to $144 per person for the whole year. The bulk of the subsidy goes to patients in B2 and C class wards and to the polyclinics. Sir, in line with the Government's aim to contain the growth in Government expenditure, it is necessary that the high subsidy level continues to be reduced. Singaporeans must therefore be prepared to pay their fair share of the cost of high technology medicine. However, as I have stated many times before, the indigent and the lower income groups need not fear as they can apply for remission or waiver of fees. Sir, I will now move on to the Medisave scheme. Since its inception on lst April 1984 in the Government hospitals, we have rapidly extended its usage. About 136,000 representing 8.6% of total Medisave account holders have used their Medisave by the end of last year to pay their hospital charges. The feedback, as the Member for Telok Blangah has mentioned, is that the scheme is helpful. Sir, we recognize that the Medisave scheme in itself is not enough. There will always be the unfortunate who will fall sick with some major illness that may completely deplete his Medisave account. For such persons, my Ministry plans to introduce a form of major medical catastrophic health insurance scheme. The Ministry is currently working with the representatives of the insurance firms in Singapore and with the Council of Health insurers. We hope to be able to finalize details of the scheme by the end of the year. Sir, for the catastrophic health insurance scheme to succeed and to incur low premiums, it must cover all persons within the effective age group. Premiums will be paid using Medisave contributions. This should not pose any problems to wage earners with Medisave accounts. However, the self- employed are presently not required to contribute to Medisave although it was announced on 22nd June 1984 that the Ministry of Labour will amend the CPF Act to require the self-employed to contribute to Medisave. My Ministry together with the Ministry of Labour will be studying how best to extend the Medisave Scheme to the self employed may be implemented. We expect to complete the study within the next 12-18 months. Sir, further liberalization of the use of Medisave will be considered. My Ministry will also carefully study the usage pattern and changes in the profile of the balances over the next 12-24 months. We will then make whatever changes are necessary or feasible to the prevailing ceiling on the Medisave balance. Let me move on now to the specific questions and points raised by various Members yesterday and this morning. The Member for Changkat has asked several questions relating to the Home Nursing Foundation and the care of the aged. The Ministry plans to build two community hospitals during the next 6-7 years. The community hospital is not meant for the use of the aged exclusively. It provides inpatient care to all those who do not need complicated or sophisticated medical care irrespective of whether they are young or old. The first community hospital will be built in Ang Mo Kio New Town where there is a large concentration of population and the large number of elderly as well. A second community hospital is meant to be built in the early 1990s. The exact location has not been decided yet. The Home Nursing Foundation (HNF) does not intend nor is its objective to take over the entire care of the elderly at home. One of its main tasks is to teach and train family members to nurse the elderly in the home environment. In addition, the semi-ambulant will be encouraged to make use of the rehabilitation and day-care facilities at the health care centres which will be opened. The target is to cover all who require home nursing care in five years' time. The Ministry currently provides 23 nurses to assist the HNF in its activities. This will be increased to 42 with the expansion of the Foundation's activities and the opening of the two senior citizens' health care centres later this year. The Ministry also provides the HNF with medical and surgical supplies at Government rates. The Ministry will be prepared to provide the Foundation with more assistance and subsidies should the need arise. Sir, with the ageing of the population, the HNF has plans to expand its scope or function and activities. Being a voluntary organization, it will be mobilizing greater community participation in its activities and in fund raising. HNF will consider being part of the Community Chest when its functions and activities are consolidated. The services to be provided in the senior citizens' health care centres will include day-care, rehabilitation, health screening, health education and counselling. The senior citizens' health care centres will be located in the new polyclinics to be built. They will be sited in relation to the number of the aged and the absence of other day-care centres for the aged. The setting up of health care centres required a considerable amount of organizational and infrastructural support in terms of professional manpower and volunteers. It is not necessary nor is it possible to provide every constituency or community centre with one health centre. The HNF has therefore decided to build ten centres in the next five years. This should be adequate to cover the needs of the aged in the community. We would like to discourage the proliferation of health care centres all over the island. However, if any private organization, residents' committee, or community centre, management committee, wished to set up such centres, they should be consolidated into a few areas where the need exists. The Ministry will assist private and voluntary organizations in the setting up of such centres together with the Ministry of Community Development and in training their staff and volunteers. With the ageing of the population, there is more in gerontology amongst the medical profession and sociologists and economists. The Ministry is participating in a study on the socio-economic consequences of the ageing of the population. Research emphasis is also being given to the medico-socio- and psycho-geriatric problems of the aged. A teaching Fellow in geriatric medicine is presently attached to the Department of Socio-Medicine and Public Health at the National University of Singapore. The Ministry has also sent two doctors for training in geriatrics over the past two years. We plan to send at least one doctor and, if possible, two, a year for training in geriatrics for the next five years. Let me now move on to the points raised by the Members for Toa Payoh and Ulu Pandan. Sir, many Members of this House must have read the various articles appearing in the press on the plight and suffering of kidney patients. They have publicized the predicament of these patients in the hope that more Singaporeans will step forward to join a scheme that amounts to the only long-term solution to their problem. Sir, as mentioned by both Members, dialysis can only be a temporary measure. It is prohibitively expensive. As mentioned by the Member for Toa Payoh, it costs a patient $1,000 per month to undergo dialysis. Not only is it expensive, but the quality of life for both the patient and his immediate family is also lowered. The patient is tied literally to the dialysis machine for about five hours each session three times per week. Usually while undergoing dialysis, a family member needs to stay with him to assist him. There are also long-term side effects, such as brittle bones. Sir, not only does the patient suffer, but the family members suffer along with him. They suffer emotionally in terms of worrying about the possible infections, they agonize with him in his treatment and financially it is a burden as well. The patient's work or career is normally affected because of the need to undergo regular dialysis. Sometimes the spouse's own career may be affected. The correct solution is to ensure that there is a supply of kidneys for transplantation. Where can this come from? There are two sources. One is from a living sibling, from a parent, or in the case of a parent from the child. The other, which is preferred, would be cadaveric organs. Sir, for the cadaveric organ programme to succeed, we need to have at least 800,000 kidney pledges. Over the last 15 years the Ministry together with the National Kidney Foundation have been publicizing widely the need for Singaporeans to sign up as a kidney pledger. However, despite all the wide publicity, only 24,000 have signed up to date. What are the reasons for this reluctance? Well, it is partly due to the lack of public awareness, awareness that only when there is an accidental death will a person's organs be required or be appropriate for transplant. Secondly, some Singaporeans show they are prepared to sign up, by obtaining the necessary forms. But after taking the forms, because of apathy or other reasons, they fail to send in the form. The Ministry has been studying this problem and one measure that is actively being considered now is the possibility of legislating for automatic organ donation when there is accidental death. This has been mentioned by both the Members for Toa Payoh and Ulu Pandan. Sir, this is not a new legislation because many other countries already have it. We are now studying the experience of such countries but the initial reports are quite encouraging. The Members for Toa Payoh and Ulu Pandan have also pointed out that, in considering the implementation of such a legislation, Government must be aware of and be sensitive to the views of Singaporeans who, for various reasons, either religious, cultural or personal, may not be in favour of joining such a scheme. Sir, their objections must be respected. The Ministry must therefore make sure that when such a legislation is being considered, we must make available convenient means for such people to opt out of the scheme. However, whilst respecting the wishes of those who do not wish to join and who wish to opt out, we must also be fair and safeguard the interest of those who are participating in the scheme. We must ensure that they are given first priority if they happen to need an organ and if such organs are available. The Member for Toa Payoh has also made some very relevant comments on catastrophic health insurance. He voiced concerns about the impact of the high cost of dialysis on this insurance scheme. He has estimated that over the period of ten years the annual cost of dialysis may increase to about $24 million a year and that this huge sum will overload the insurance system. It may end up depriving other patients who are suffering from other serious illnesses from benefitting from the insurance scheme adequately. Sir, we will definitely need to consider certain safeguards and I wish to thank the Member for Toa Payoh for his suggestions. Let me move on now to the question of Medisave as raised by the Members for Jalan Kayu and Telok Blangah. The Member for Jalan Kayu has expressed fear that Medisave account holders may misuse their medisave funds by getting hospitalized when their medical condition does not warrant it. He is also afraid that, with the extension to the private hospitals, the doctors in the private sector may not practise restraint and liberally hospitalize their patients. Sir, I sounded a similar reminder some three weeks ago to Medisave account holders that they should not overlook the fact that the money in their Medisave account belongs to them and that, if they conserve their funds carefully, they will over a period of time reach the ceiling that has been imposed. The contribution in excess of the ceiling will then be transferred to the Ordinary account which can then be used for paying their housing loan or for investment, as the case may be. More importantly, nobody can predict when they or their family members may fall ill. It may be from an accident or from contracting various diseases. It could be from normal wear and tear of the body because, after all, one's body does wear out. Whatever is the cause, when it does happen and one is hospitalized, the Medisave funds will be a great relief. At least the account holder and his family need only worry about recovery from the illness and not about availability of funds. However, while there is a need to periodically sound a note of caution on the use of Medisave, there is presently no cause for alarm. The usage over the past two years since Medisave started shows a very cautious usage pattern. For the six months to the end of December 1985, 90% of all withdrawals were for less than $1,000. I am confident that Singaporeans are by and large very careful with their money and they will spend it wisely, provided they realize it is their own. The Member for Jalan Kayu has also suggested the possibility of using Medisave for payment towards a general medical insurance. Sir, we must learn from the experience of others who have gone through the route of general medical insurance for the whole population. These countries are now facing difficult problems in relation to funding the system. Let us learn from their mistakes. It has been shown that a general medical insurance scheme when extended to the whole population inevitably end up creating the "buffet lunch syndrome". What is this? This is a situation where the insured, after having paid for his insurance, decides that he should use the benefit. Yes, of course. Initially there will be caution and reluctance to use the scheme unnecessarily. But after a few years when he starts toting up how much he has paid up, he will be wondering, "what am I paying for? I have not used any of it, I'd better use it up when I have the next opportunity." What does that do to the insurance companies? Very easy. They just increase the premiums and the careful and sensible account holders end up paying unnecessarily for those who abuse it. So eventually even the cautious get into the act. This ends up in a big usage spiral. The Member for Jalan Kayu also stated that with a general medical insurance system Singaporeans will end up taxing the taxpayers less because they will be using their own insurance system. They will not be using subsidies. I think he is totally wrong on that point. In fact, we will end up paying more subsidies to the hospitals. The reason is that at the moment 80% of all hospital services are provided for by the Government. Out of these services 75% of all beds are in the heavily subsidized B2 and C wards. Sir, the Ministry is definitely not in favour of using Medisave as payment towards a general medical insurance system. The Member for Whampoa has also asked that the Medisave ceiling of $15,000 be lowered to enable more people to use it for house-ownership. The Government has already announced a wide range of measures to overcome problems faced by house owners because of the CPF cut. They can also use the amount in their Special Account if need be. The Medisave scheme has just been extended to private hospitals. We have also liberalized recently and more liberalization will be considered. I think it is prudent for us to study and analyse the usage pattern for the next 12 to 24 months, as I have just mentioned, and then make appropriate modifications when necessary. Let me move on now to the question on the A&E problem. Let me first give an overview of the problems facing the A&E departments. Up to the end of 1985, the A&E departments have been overly utilized. The fundamental problem is that the large number of patients which stood at 211,000 in 1975 increased to a total of 470,000 in 1984. This represents an increase of 122% over a 10-year period. Analysis of the patients revealed that only 43% of the patients had an emergency condition, the remaining 57% were actually non-emergency patients. The misuse of the A&E facilities has created huge problems. Firstly, you have the problem of long queues with long waiting times. Yes, certain patients during the peak periods have had to wait up to three hours. The doctors, the nurses and the supporting staff also face tremendous pressure from the large crowds who are all clamouring for early treatment. The sad part is that because of this pressure, genuine cases sometimes are not able to obtain immediate treatment as they fall into the queue. The doctors are also unable to give adequate treatment time. Because of the rush, the doctors run the risk of missing vital symptoms. The result has been frayed nerves and tempers and unhappiness all around. The Ministry reviewed the situation and late last year decided on a two-prong approach. We launched a publicity blitz in the mass media. We used posters. We distributed plenty of pamphlets and the whole programme took off on 1st November 1985. At the same time, we started a pilot project at Tan Tock Seng Hospital whereby non-emergency cases were identified using triaging nurses and during the evening peak hours they were re-directed to the evening clinics that have been established within the hospital for this purpose. The pilot project has been found to be very satisfactory and by the beginning of this year all the four A&E departments, namely at SGH, Toa Payoh, Tan Tock Seng and Alexandra Hospitals, have started re-directing non-emergency cases. During the daytime they are re-directed to the OPDs that are close by and to the GPs. In the evening, they are re-directed to our evening clinics. The results have been good. We have seen a drop in attendances from about 8,100 per week before the scheme started to about 6,500 in February this year, representing a decline of 20%. The proportion of non-emergencies has also reduced from 57% to only 22% in February. Waiting time has also been reduced and now 85% of all patients only wait for less than half an hour. The remaining are seen to within an hour. We will continue to educate the public and we will continue to triage and turn away the non-emergency cases to ensure that genuine emergency cases will be given their proper treatment. Let me move on now to the remarks made by the Member for Whampoa. Sir, yesterday the Member for Whampoa, true to form, made an impassioned and emotional speech on abortion. Unfortunately, because of shortage of time, he was unable to complete his arguments but I am aware of his stand. One needs only to refer to the Hansard to note his firm and unwavering position on this issue. I understand and appreciate the Member's strong religious convictions. While I do not intend to repeat all the past arguments which are still valid today, two points bear repeating. The Government's prime concern must be for the safety and health of the expectant mothers. Depriving them of legalized abortion will not eliminate the existence of the operation. It merely erases the official data on the number of abortions that have been carried out. A woman who is determined not to complete her pregnancy will only be forced to go to the back-street abortionist. It will be very unwise to return to the 1960s when septic abortions by back-street abortionists were the order of the day. Secondly, it will be totally erroneous to blame the availability of abortion on demand for permissiveness. Singapore is an open society. We are completely exposed to western influence and lifestyles. It is inevitable that a number of our impressionable youths and others will adopt some of these lifestyles, including undesirable ones. It will be folly to try to turn the clock back and isolate ourselves from the rest of the world. Since we cannot, we must find other alternatives. My Ministry has all along been counselling patients seeking abortion in Government institutions. This has made our hospitals unpopular despite the fact that it costs only $5 for an abortion. Today, two-thirds of all abortions, as pointed out by the Member, are carried out by the private sector. It is therefore important for private practitioners to also participate in counselling abortion patients. The Ministry is finalizing plans to make abortion counselling mandatory for all seeking abortion at Government and private hospitals and clinics. This abortion counselling programme will involve the following: 1. Advising patients that abortion is not without risks and should not be resorted to unless absolutely necessary; 2. Emphasizing that abortion should not be used as a method of family planning and that there are other safer and simpler methods of family planning; 3. Encouraging women to continue with the pregnancy if she is psychologically, socially and economically in a position to do so; and 4. Motivating the women to use a reliable contraceptive method after the abortion if she insists on continuing. The abortion counselling programme will be closely monitored in all Government and private institutions. Sir, abortion is a social, more than a medical, issue. Any reduction in the number of abortions will require a change in society's attitude towards not only abortion but also marriage, responsible parenthood, illegitimate children and unwanted children. The Ministry will work closely with the Ministry of Education in this respect. Sir, I am not hopeful that we can erase the need for abortion. What we can do is to try to restrain and eventually reduce such demands. Let me move on to the Member for Anson. He has made a plea that the Ministry be less rigid in collecting charges. He has mentioned a case of a man who is now jobless who has approached him for advice. I am very happy that for once he has given him good advice, and that is, "Please go to the hospital, inform them of your plight and the hospital will help you." That is the correct advice to give and I hope he will abide by this practice in the future.

Will I see results?

Anyone who approaches our hospitals and informs us that he is unable to pay for various reasons, will have his case investigated. We will review his employment circumstances, his family circumstances, and if it is a genuine case we will give him full assistance. Sir, he also said that some members may not be prepared to use their Medisave because they would like to leave some balance for future living purposes. My advice to them is that they should use the Medisave in relation to the balance that they have. If they have a low, Medisave balance, they should go to the C class and the bills will be low, and if the balance is still not enough they are allowed to overdraw. If they are jobless and they cannot afford to pay, we will then investigate and, if necessary, give them a waiver.

Why can't we have a rule that those who are unemployed can avail themselves of free treatment?

Let me move on now to the points brought up by the Member for Bo Wen. He has asked about the redevelopment programme for Toa Payoh Hospital which serves Ang Mo Kio, Bo Wen and Bishan. There are plans now to upgrade Toa Payoh Hospital. The timing has not been fixed. But it is likely that when the redevelopment programme proceeds, Toa Payoh Hospital will be redeveloped with an increase of 150 beds, making a total of 560 beds. The renovations of the existing building will be carried out to upgrade and provide more B2 class beds, for which there is a tremendous demand and which unfortunately is not available at the moment. The facilities and services which are presently inadequate would be upgraded and this would be included as part of the redevelopment programme. With the completion of the redevelopment, Toa Payoh Hospital will then definitely be in a good position to service the new towns around the area, namely, Toa Payoh, Ang Mo Kio and Bishan. As regards the enquiry by the Member for Pasir Panjang, he has asked a few questions. Firstly, is there an A&E service available at NUH? The Emergency Department of NUH will be opened in May this year, ie, in two months' time. What are the number and class of beds available? At the moment, we have 47 private rooms, ie, single-bedded rooms. We have 92 beds in 4-bedded rooms and we have 145 beds in 6-bedded rooms. The 6-bedded rooms are equivalent to the B2 beds in Government hospitals. The charges are similar and they are very heavily subsidized. When fully commissioned, we will have 81 beds in the single-bedded rooms, 156 beds in the 4-bedded rooms and 403 beds in the 6-bedded rooms, making a total of 640 beds.

Mr Yeo, it is guillotine time. It is 1.00 pm.

Sir, in view of the Minister of State's full replies, in spite of the shortage of time, I beg to withdraw my amendment. Amemdment, by leave, withdrawn. The sum of $455,781,740 for Head P ordered to stand part of the Main Estimates. The sum of $58,667,600 for Head P ordered to stand part of the Development Estimates. Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the House.

I suspend this Sitting and will take the Chair again at 2.30 pm. Sitting accordingly suspended at 1.00 pm until 2.30 pm. Sitting resumed at 2.30 pm

Debate in Committee of Supply resumed.

Head R -

Mr Speaker, Sir, I beg to move, That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RA-01 Object Group 1100 of the Main Estimates. Sir, a few days ago the Straits Times reported in its Forum page a reply by the CPF Board to a request by an employer for greater flexibility in terms of payment of CPF. The CPF contributions, whether they are from the employer or employee, are workers' wages. Employers are made responsible for the payment of CPF contributions to their employees' CPF accounts. Last year the NTUC drew the attention of the CPF Board to the fact that some employers had failed to pay their contributions into employees' CPF accounts, resulting in some workers losing CPF contributions when employers defaulted and went into liquidation. As a result, the CPF Board took measures to tighten up the procedures. Although this has been done, more workers have lost their CPF contributions when companies wind up and go bankrupt. This comes about because of the time lapse between default of payment to actual enforcement action by the CPF Board. Employers are normally given two weeks to pay CPF contributions. The CPF Board lists out those companies who fail to pay three weeks from the end of the grace period, and sends out notices. Employers are given another two weeks to pay the arrears. It is only after the expiry of 14 days that the CPF proceeds to initiate legal action to recover the money due to the employees by first obtaining permission from the AG's Office. By the time legal action actually commences, as much as three months would have elapsed because one must remember that a date for a court hearing has to be obtained. The employees come to know about the position a little earlier, roughly about two months after the employers' default of payment. So there is a real risk on the part of employees to lose their CPF contributions if eventually the employer is unable to pay. This situation is unsatisfactory. While one may sympathize with employers who face temporary cash flow problems, it is the employer's duty to inform employees that he is using the employees' money for business operations, in other words using part of the employees' wages for his business operations. And making use of employees' money without informing them must be morally wrong. I am aware that the CPF Board has come under pressure from employers to be more flexible. While we do not want to take hasty action to cause the unnecessary collapse of firms with liquidity problems, on the other hand we must protect the interests of workers. I would urge the CPF Board to require all employers to inform their employees immediately when they are unable to pay their CPF contributions. I think it is only fair that the employee knows that his CPF contributions have not gone into his account. I think it would be unwise of the CPF Board to continue to give the employers the latitude which they have hitherto had with workers' money without the workers knowing about it promptly. I would like to urge the Minister to request the CPF Board to further tighten the measures in the manner in which I have outlined. Sir, I have another amendment No. 5 which I propose to speak on now. In this period of economic recession, much has been asked of workers to make sacrifices. It is always unpleasant to face the prospect of no wage increases. But workers are prepared to go along if it is justified. The success of our wage restraint policy will depend very critically on the labour-management relations that exist within companies. So in this critical stage of our economy, I think it is only wise on the part of managements to exercise understanding and to keep the trust of their employees. So I think this is a time where they have to exert even more to win the hearts and minds of the workers who work for them. We should not allow unconsidered action by employers to disrupt the labour-management relations which hitherto have been cordial. Now I would like to express in this House an appeal to all employers to act carefully and wisely in this difficult period of time so as not to create unrest, unhappiness among workers. It is only when there is industrial peace, harmony, a willingness on the part of both employers and employees to pull together that we will succeed. So we must not have unscrupulous employers taking advantage of the situation. We should have caution all round, good sense and good will.

Mr Speaker, Sir, an item of keen interest during this recession is, of course, the CPF. In fact, during good times or bad times, CPF is a hot topic. This is inevitable as there are more than $20 billion standing in the fund. At this level it is easy for one and all to suggest how this money may be made use of. The latest scheme, of course, is the investment of CPF savings in shares, loan stocks, unit trusts and gold. Personally, I am not in favour of CPF savings being used for such investments as it goes against the philosophy and objective of the CPF. Before we liberalize further on the use of CPF, I think it is important that we go back to fundamentals. The objective of the CPF is well known and I do not intend to discuss it here. However, I shall limit, my discussion to three areas which have a bearing on the utilization of the CPF. The first is the changing rate of savings. Sir, in asking that CPF savings be used for different purposes, there is this general expectation that CPF savings will continue to rise or at least be maintained at a high rate. The recent reduction in the CPF should bring home the point that this is not so and that the CPF savings rate is actually an economic tool. In the years of high inflation, the CPF rate should increase to reduce the liquidity in the market, to cut costs of doing business. We have just modified the employer's rate of contribution and I cannot see, or be absolutely certain, when will its original 25% rate return. The CPF may also have to be modified at some point in time to take into account the structure of the workforce. A young worker will need a higher rate of CPF to enable him to pay up for his home and an older worker may be paid a lower rate to make him more attractive in the workforce. Such flexibility will ensure that we shall always be able to react to changing circumstances. This flexibility also means that we must be prudent in the way in which we use our CPF savings because our savings may not always remain high. The second point, relating to CPF is the rate of return. In the years when market interest rates were high, there were recurring complaints that CPF savings were not attracting a good interest rate, even though it is for payment on HDB mortgages. HDB mortgages command a special interest rate. Even these people felt that the Government was unfair as the CPF balances were getting a poor rate, never mind what is their mortgage interest rate. Sir, today the situation is quiet for various reasons. Therefore, I fully support the move of the Government to peg the CPF rate to market rate. The linkage between return on savings and the cost of mortgage is now properly established. You pay for what you get. With the pegging of the CPF interest rate to the market, an important by-product is that there is no rationale for allowing CPF to be invested in shares and gold. In the days when there were complaints that the CPF interest rates were low, contributors said they could get a better return in the market. Butwith the rate pegged to the market, people must understand that this interest rate is a risk-free, tax-free rate. That is about the best rate you can get in the market without any risk. Therefore, I think the Government should not open up Pandora's box and allow more uses to be made of the CPF. The third point is investment in property. This I support wholeheartedly. Investment in Singapore property or whether it is an HDB flat, a private residential property, commercial and industrial property or even vacant land, with CPF funds is a correct move in line with the basic aim of the CPF. With ownership of a property, when you retire you can always convert your property into cash and rent a home. In my opinion, it is also the right philosophical bent. Nothing evokes a more emotional response than to be able to say, "I own a piece of Singapore." This is a stake in the country which we must all nurture. Hence, instead of opening the door to other forms of investment, the Government must restrict the use of CPF savings to property investments only. However, the rules may have to be liberalized further. In fact, I see no reason why HDB flat dwellers or flat owners should not be allowed to invest their surplus CPF savings in a second residential property, better this than in shares and gold. Finally, Sir, let me refer to the Economic Committee which has called on the Government to, "review the CPF scheme from a longer-term perspective, to decide on the appropriate long-term rate and structure of CPF contributions that would meet the basic needs of retirement income, home ownership and medical care." I endorse this call for a comprehensive review. However, if we accept the fact that the CPF rate of contribution is an economic tool, a long-term rate must also have built-in flexibility. The question of home ownership must also be enlarged to property ownership and, most important, the objectives of the CPF must be clearly restated and argued. The Government must not be afraid to do what is right and it is better, as far as I am concerned, to err on the side of prudence. 2.45 pm

Sir, during the past year, we have seen many changes made to the utilization of CPF funds. We have seen the CPF allowing members to purchase non-residential properties. Although the rules are not out yet, I understand that the Minister will soon come out with the rules regarding this. We have also seen an allowance of 10% to be made for investment in stocks and shares, gold, trustee bonds and the lot. For these, Sir, I understand that the CPF would allow what they call a substitution of stocks and shares or gold for money, which means that when the new rules come out, members already with stocks and shares in their names can submit them to the CPF and in return, the CPF would release the funds. So it is not a new purchase. Sir, I would like to ask the Minister whether he considers these new avenues of so-called investments speculative and consumptive. We do know that the prices of these so-called assets can vary very drastically, especially during these times. Hence, it is beyond understanding why the Minister has steadily refused the most important investment of all, that of investment in our children's future. Sir, here I am referring to the perennial question of asking the Minister to allow the use of CPF funds for children's tertiary education. Sir, we all know that the entry into our University is on a competitive basis. Last year, I understand that there were many qualifiers who could not secure a place in our University because standards were high and places were limited. These persons have no place to go for their tertiary education except overseas. Their results are not good enough for scholarships. But the same results are good enough to gain acceptance into recognized universities abroad. Sir, their parents would like to send them overseas but for the lack of money. On the other hand, they do have large balances in their CPF accounts and they are prepared to use these monies to further the education of their children. However, the Ministry has always said no to such pleas. May I therefore suggest that in the current review of the CPF Act, the Board should set aside a percentage, maybe 10%, of the balance to be permitted for withdrawal for the use of educating members' children. Mr Chairman, Sir, this is not the first time this matter has come up. Last year, I mentioned and I hoped that the Minister would finally allow this to be permitted. But he has refused. Last year, although I added one more "P" to the politics of perseverance, persistence and patience which did not pay off, this year, Sir, if I may, may I add one extra "P" and say "please" to the Minister. The other point that I would like to bring up is in regard to the foreign maid levy. I am aware that the Acting Minister, in his reply to an oral question on foreign worker's levy several days ago, has stated that there would be no change in the quantum of the foreign maid levy. In his reply, he said that Singaporeans should employ locals and provide employment to Singaporeans, especially during this recession. Sir, a number of my constituents have called me to express their agreement with the Acting Minister's comments. However, they have also asked me a few questions and because I am unable to reply, I am redirecting them to the Acting Minister. They asked, (1) where can they get Singaporeans to be full-time domestic help? (2) are there any Singaporeans registered with the Employment Service Department in the domestic help category so that they can go to the Department to employ them? If so, how many are there? (3) Are there Singaporeans who are prepared to work as full-time domestic servants for roughly about $400 per month, which together with CPF contributions would come to about $440 per month? The reason for this figure is that they are currently spending roughly about $500 per month on their foreign maids. And with the recession and the CPF cut of 15% on their own salaries, they find it difficult to make ends meet. Sir, they have also ended their request with the comment that if it is difficult to get Singaporeans to be maids, would the Ministry reduce the foreign maid levy by 60% which is the same percentage as the reduction in the employer's CPF contribution? After all, they are also employers and need to cut costs in these times. Mr Chairman, Sir, I happen to agree with these views. Sad to say, as I said earlier, I cannot answer these questions and I would really appreciate if the Acting Minister could provide the answers. More importantly, the Acting Minister should also realize that the quantum of $120 per month was imposed at a time when the economy was booming and when incomes were high. However, we are now in a recession and incomes are low. Further, I think I would not be too far amiss if I say that there are not many Singaporeans who are prepared to work as full-time maids although I do not know the figure. Sir, based on this, I do think that there is a case for a reduction of the levy. Mr Jeyaretnam rose -

I am trying to follow the order of the names appearing on the Order Paper Supplement. If you want to be Dr Wong, by all means, Mr Jeyaretnam.

I am sorry, Sir.

Thank you, Mr Speaker, Sir. I would also like to join the debate on the CPF and also on foreign maids. By pure coincidence, the previous speakers and also the last Member have touched on these two issues which I wanted to talk about. First, on the CPF. I would like to approach it from the problems of the aged. Since the Ministry is currently reviewing the entire CPF structure, I would like the Minister to pay attention to the question of the age of retirement which is necessarily tied with the age of CPF withdrawal. It is well-nigh impossible to separate the two issues. In the Howe Yoon Chong Report, it was recommended that the customary retirement age should be deferred as far as possible, from 55 to 60 and eventually to 65 years. It also recommended that the Government should set the pace by liberally re-employing its employees beyond the current retirement age. It would seem that the present effort of the Government to trim the size of the civil service is a temporary setback to this long-term strategy. But in my opinion, we should not lose sight of our long-term objective and therefore the question of retirement age should really be considered at the same time as the age of the CPF withdrawal when the entire CPF scheme is being reviewed. Unfortunately, this became a very emotional issue during the last general elections. The dust has now settled. I think it is time for us to look at this rationally again. The second point I want to make about the CPF and its relationship to old age and our old age problem is that, as the Member for Radin Mas has pointed out, with a declining rate of CPF contribution, ie, declining with age, the older workers will face some problems with paying their housing loans. So if this scheme of progressively reducing the CPF contribution rate is adopted, then the Government would have to pay special attention to the ability of the older workers to repay their housing loans. And I would like to reiterate my previous point when I spoke on my amendment on the Ministry of National Development, that it is perhaps time for us to encourage our population to start thinking about buying smaller flats. The HDB should also think of allowing the older residents to exchange their flats for an annuity. This is not just a matter for the HDB to consider. But I am sure the Acting Minister for Labour would consult closely with the Minister for National Development on these matters. Coming to foreign maids, I am of the opinion that foreign maids are not a good solution to our long-term problem of encouraging more women to go into the labour force. It is not and cannot be a long-term solution. In other countries, women have tried to cope by working part-time, by using more labour-saving devices, by paying very expensively for part-time domestic help, by enlisting their husband's help in housework and also by sending their children to child care centres. In Singapore, part-time employment for women is not so readily available and it is a fact that there is still not enough child care services. With the $120 foreign maid levy that our people are paying for each foreign maid, and assuming that there are 30,000 foreign maids now, the Government is collecting a total of $43 million a year. I feel that this sum should be directed towards building more child care centres, which to me is a much better long-term solution to helping women to enter the labour force. Right now, each child care centre receives about $40,000 subsidy from the Ministry of Community Development in terms of the capital cost. Of course, these centres have to raise their own running costs as well as to find the suitable staff. Also, parents' attitude towards sending children to child care centres has to be changed. My point, I believe, Sir, is that more efforts in fact should be directed towards building child care centres. And since we are collecting this levy on foreign maids, it is a logical way of using this money for the building of child care centres. The second perspective that we have to adopt when considering the foreign maid question is the social and cultural implications of having a large number of foreign maids living with our families. I need not belabour this point. There are all kinds of problems of cultural adjustment on both parties involved, problems of children learning a different set of cultural values from people coming from different kinds of backgrounds, problems between husband and wife that may arise because of misunderstanding over the maids. In the long-term, it is no good for our society to have so many foreign workers living right in our homes. The third angle I want to talk about is the humanitarian side. Sir, foreign maids are also people who come here to work because of economic hardship or other reasons back home. They deserve our every sympathy and also our understanding. Occasionally, you hear about employers ill-treating the maids. I am sure this may be just a small minority of cases. But it does not do any good to our national reputation, nor any good to bringing up children to respect people. Sir, would the Minister not think it possible to devise some minimum legal or legislative protection of some kind for these foreign maids, in case they are seriously ill-treated by their employers? Is it purely a matter of the numbers involved, the small minority of cases that are being reported? Is it purely a matter of the difficulty of implementing this kind of law? Or should we not think in terms of the benefits to be derived from a legal protection, a legislation, which would teach our people what it means to be living in a really caring and cultivated society where people respect people as people.

Mr Speaker, Sir, under this amendment I would like to talk about the CPF rate of contribution, in particular the employee's contribution. Sir, presently, employees who earn less than $200 a month need not contribute to CPF. A person starts to contribute to CPF when his salary exceeds $200 a month. He has to contribute the full 25% CPF only if his salary reaches or exceeds $363 a month. Sir, it is pertinent to note that while the CPF contribution rate has been raised over these years, the salary level above which CPF is payable has remained unchanged. As a matter of fact, this floor salary of $200 a month above which CPF is payable was first introduced in 1968, some 18 years ago. Even at that time the full CPF payable for those who earned morethan $363 a month was 6(r)%, and today we are insisting that all those who earn $363 a month must save 25% of their salary for old age or for buying properties. Sir, the take-home pay of a person earning $363 after deducting CPF is only $272. I think it is unrealistic to insist that a person who earns $363 a month today must save 25% of his income. The full salary is not even enough to meet the expenses of the family. Sir, I am not against savings for old age or for helping our citizens to own their homes. But we must be realistic enough to acknowledge the fact that the immediate concern of a person who earns $363 a month is to make ends meet. I believe it is just wishful thinking that we can effectively sustain a high compulsory savings rate for a person earning $300-400 a month, especially if he has to support a family. He will have to resort to ways and means to beat the system. Either he will look for jobs which can evade CPF contributions, or the law-abiding employers will have no choice but to raise their salaries in order to attract the workers. Given a choice between a low-paying job which attracts full CPF contribution and another job, say, an odd job which can avoid CPF contributions, a person will tend to take up the latter job which offers a higher take-home pay. If today we are serious in wanting to convince our workers, especially the retrenched workers, to accept and adjust to a lower salary under the present difficult economic conditions, then a lower employee's CPF contribution rate for the lower wage level is a proposal which merits consideration. This will help to ease the pressure on both employer and the employee in offering or requesting for high salary. I would therefore like to suggest to the Minister for Labour that a complete review of the employee's CPF contribution rate be made. To start with, the floor salary above which CPF is payable should be raised. I suggest that the limit should be raised from $200 a month to $300 a month, that is, an employee starts to contribute to CPF only if he earns $300 a month. Even then the employee's CPF savings rate should only be 10%. But the rate of contribution can be increased gradually to the full 25% when his income reaches, say, $800 a month. This 25% contribution rate can be maintained throughout the working life of the employee until he reaches the age of, say, 50 years old when the rate can be gradually reduced. By that time, he will have sufficient savings or would have already owned a home. Hence a reduction in the savings rate could possibly be justified. A corresponding reduction in the employer's CPF contribution rate for the older workers would have a positive and desirable effect of encouraging the employers to engage these older workers. Sir, I would like to suggest to the Minister to consider these proposals very seriously.

( In Mandarin): Mr Speaker, Sir, I would like to express my opinion on certain matters under the Ministry of Labour. I support the Member for Kebun Baru for what he has said about CPF, that it is part of the salary of the workers. What we should pay attention to now is that many employers are in arrears as regards their CPF contributions. Not only has the employer's part of the CPF not been paid up, but also the employee's part. That is to say, part of the employee's salary deducted from the employee's pay for CPF contribution is not paid to CPF. This has not only caused a loss to the employees but also when they submit income tax returns because their figures do not tally. Therefore, this has affected the truthfulness of the income tax returns. Therefore, I hope the Minister would review the CPF regulations and if necessary, amend them in order to protect the interest of the employees. The second point is about secret ballotting for recognition of a union. I would urge the Ministry of Labour to review this provision because employer-employee relationship has reached maturity nowadays. We have very responsible unions and workers. When workers want to form a union and before they could request their employer to recognize the union, they have take a decision by way of a secret ballot. I feel that this regulation should be amended because this regulation usually causes a worsening of the relationship between the employer and the employees. The reason is that when a secret balloting is being carried out, the procedure itself gives rise to a worsening of the relations between the two parties from the very start. In many countries, including Japan, when the employees want to form their union, they need not go through secret balloting. I wish to point out that in Singapore the relationship between the employer and the employee is quite mature. Therefore, when the employees want to form a union, it would not be necessary to ask them to take a secret ballot. The other point I would like to raise is that the Ministry of Labour should strengthen the staffing of the Industrial Relations section. I believe in the next five years its staffing position should not be reduced in spite of the Government's policy to reduce manpower by 10%. On the contrary it should be increased. The reason is that the Industrial Relations section will play a continually important role in the future employer-employee relationship towards an era of free collective negotiation and wage reformation. In future, industrial relationship and negotiations will be more complex and will not be dependent only on the profit and loss situation of the company but also on the various systems and the various investments of the company, its capital yield analysis, and so on. Also, in wage reform, there would be the evaluation of each job and the individual assessment of the employee's qualification, background experience, etc. All these will be taken into view. At the same time, in going about wage reform there will be the gradual doing away with annual wage increment in keeping with the company's business condition and its prospect and even a comparison will have to be resorted to with capital yields in other developing countries. It is no longer like haggling and bargaining in the market place as in the past. There is going to be a more scientifically enlightened and sophisticated systematic type of analysis of the company and negotiations. In view of this, I believe the proper staffing both in terms of quantity and quality in the industrial relations section of the Labour Ministry in this respect is very important. Therefore, I hope the Acting Minister for Labour would give the Labour conciliation officers more power and proper guidelines in order to carry out their role more effectively. I would also call upon the Ministry of Labour to organize more study courses and seminars through the National Productivity Board in order to train the Labour relations officers of the unions and the management personnel on the employer side in order to maintain the existing good relationship between the parties concerned in future.

Mr Speaker, Sir, before I speak on the amendment, perhaps I should say I have no direct personal pecuniary interest in whatever I say. Of course, I do act for workmen in claims against their employers and in accident claims. Sir, I would like to commend to the Minister whether he should not consider changing his designation from that of "Minister for Labour" to "Minister for Employers". I am not saying this out of sarcasm or with my tongue in my cheek. I am quite serious about this. I am saying to the Minister that for all the work that he and his Ministry is doing to protect the workers in Singapore, it is a waste of public funds. The workers will be no worse off if the Ministry fails to exist in Singapore. Are these harsh words, Sir? They might seem to be harsh words. But I will try in the time limited to me to show that they are not harsh words. First of all, there is, as we know, this growing unemployment, but the Ministry apparently is still not able to collect accurate information on the number of unemployed and about the numbers who have been found jobs. Sometime ago the Minister said in 1984 there were no jobs lost in reply to the Member for Rochore. I checked this up in the 1984 Research and Statistics Department in his Ministry Report on the Labour Force Survey, and I find that in 1984 more than 6,000 jobs were lost, not taking into account those who resigned and those who retired. So it would appear that even the Minister does not take the trouble to get his facts correct. The other thing is that the Minister appears to show no appreciation or empathy for the workers and their feelings. May I again refer him to his answer given in this House to a question that I asked him whether his Ministry would take any action to stop needless retrenchments by companies. His answer shows exactly where his interest lies. He says, "I do not think the employers would just retrench workers out of spite or for no good reason." We have heard from several Members here, not just me, that employers are taking advantage of the recession and they are throwing their workers out of employment, and the Minister says, "No, I don't think they do that, do they? And I don't think my Ministry should interfere." So I ask: is it a Ministry to protect our workers, or is it a Ministry for the employers? Our workers who have come to see me tell me that when the Ministry speaks, they hear the voice of the employer. They do not hear their own voice whenever the Ministry speaks. I think the Minister should know this. There were the Jurong Shipyard workers who were being "persuaded" by the company to accept early retirement. Then because they had come to me, the company thought better of it and said they would take them back. But they wanted to see the Minister on the terms on which the company would take them back and I spent a whole Saturday morning trying to get the Minister to see these workers. I got no reply. The following Monday I was told that the Minister would not see the workers but one of his officials would see them. Why cannot the Minister see the workers if they wish to see him? Is he too busy seeing the management that he cannot find time to see the workers whose welfare is his responsibility? There is the urgent need, desperate need, I tell the Minister, for legislation to protect our workers. I can tell him about all the countries in which there is this legislation. Is he going to consider introducing legislation to give security to our workers in their employment, to protect them against employers, or is he going to say, "Oh, no, we have got good employers in Singapore. I cannot see any bad employers." There is this section 14 of the Employment Act. I have mentioned this several times in this House that it was intended to protect the workers from unfair retrenchment. Last year I brought up the case of a man who had appealed to the Minister some months before I brought up the matter, and the Minister's reply was, "We are still considering this." I am now told, several months later, that the man was informed, but in a curt reply, that the Minister has decided not to intervene. That is the sort of attitude that our workers get from the Ministry. It is appalling that the Ministry of Labour, set up primarily to look after the welfare of our workers, should so neglect its responsibilities and duties. Sir, I would urge the Minister to take immediate steps to see that, particularly at this time, our workers are protected and I would urge him quite seriously to lend his efforts to persuade the Cabinet and the Government to giving unemployment relief to those out of employment. There is another amendment I have and, that is, under the workmen's compensation. Here again, it is a sorry tale, Sir. I see that the Auditor-General in his Report for the financial year 1984/85 reports at paragraph 104 that the Ministry had: 'no procedures to ensure prompt clearing of long outstanding compensation moneys. As at 30 September 1984, compensation moneys totalling $156,399.79 received [mind you, Mr Chairman, this is what he says] during the 1960s and 1970s remained in the Workmen's Compensation Deposit Account.' That is, between 24 and 14 years, they have been remaining in the Workmen's Compensation Deposit Account. Why? May I know from the Minister what has happened to these moneys now? And he goes on to say: 'A further sum of $349,600.23 in another trust account, as at 31 December 1984, had also not been distributed to beneficiaries as required by law.' The Prime Minister last week said, "Do we need to flout the law?" "We who have 77 Members in this House," he said. But there you have it from the Auditor-General saying that the Ministry of Labour flouts the law. A sum of $349,000 undistributed when the law requires that it should be distributed. May I also, whilst we are on the question of funds, ask the Minister what has become of the Spyros fund that was set up for the victims of the Spyros disaster. I have been questioned on this by people who have asked me to raise in Parliament as to whether any account has been published of this Spyros fund. Will the Minister be able to tell us, if not today, sometime later at another sitting, what has become of this fund, and how much of it has been undistributed? Whilst on the workmen's compensation, may I also bring to the attention of the Minister a case where a worker, who was injured in an accident and which was reported to the Ministry of Labour, had to wait for more than three years before the Assistant Commissioner for Labour assessed the compensation. And when he received it, more than three years later, he found it was completely inadequate for the injuries he had sustained. Of course, the Assistant Commissioner for Labour was not to blame. That was the assessment under the Workmen's Compensation Act. But this unfortunate man who should have got a lot more than what was assessed under the Workmen's Compensation Act was debarred from bringing any action in court because under our Limitation Act any action for negligence had to be brought within three years. So may we have an assurance from the Minister that the Workmen's Compensation Section of his Ministry will speed up things a bit and try and protect workmen who have been injured? I have one other instance where a company sent a worker outside Singapore to work and he was injured in an accident and the Ministry refused to do anything about it because the employer said, "This was not in the course of any of his work that he sustained this accident." That is the sort of attitude that the Ministry takes, ready to listen to everything that the employers have to say but not ready to lend a willing ear to the workers. I do hope that we will see a complete change of attitude from the Minister and his staff after this, especially, as I said a little while ago, in this time of recession when our workers are being made to bear the cost of the recession. It is they who are suffering and it is time the Ministry awoke to its responsibilities to them and discharges those responsibilities.

Sir, the Government has announced that it will defer payment out of CPF and give a decision in two years' time. But the Government has also thrown out some ideas in that regard. In December 1984, the Prime Minister agreed on a proposal that $25,000 be kept at 55 years and the balance given out. However, if the contributor has purchased an HDB flat and paid for it in full, then he can take out all his balance CPF at age 55. However, this sum of $25,000, when the worker reaches 55 years old, will have to be paid out in instalments until he reaches the age of 60 and then 65 years. Does the Acting Minister agree to that proposal? I should say that that proposal originated from his pre- decessor, Prof. Jayakumar. Will the sum of $25,000 eventually be held back? The public has a right to know because it is their money. CPF savings are the workers' money, it is often said. All CPF money belongs to the contributors. Therefore, I say to the Government, it has no business to hold back any money belonging to the people. The Government should now, in clear terms, state whether or not it intends to return all CPF money to contributors when they reach 55 years. I have asked this question many times but I have not got a straight answer yet. I hope this time I will be more successful because a very vast sum of money is involved, about $24 billion. My Party has stated that due to the aging population and the vast amounts accumulated in the CPF by workers, the Government eventually will not be able to pay back the money to the contributors. We were ridiculed by the Government for that statement. Now we are not alone in saying that. The economist of Philip and Drew, one of London's largest stockbroking houses, in their studies also, came to the same conclusion last year. Their report stated that the Central Provident Fund faces the danger of severe financing problems in the next 25 years with payments exceeding contributions as a result of a gradually aging population. Sir, I make no apology for taking up this issue again. All our workers' CPF savings are involved. So we in the Opposition have that responsibility at least to our workers. The Finance Minister and the Acting Minister's explanations in respect of that report are not convincing. The Prime Minister himself admitted that there was a problem, in the interview published in the Straits Times, 21st December 1984, when asked whether there was concern among people nearing the age of 50. He said: 'No, no. They don't have to worry about that. We are not worried about the people over 50. We are not even worried about the people over 45 because their numbers are small and it is not going to be a serious problem. The problem will be enormous when the people in their early 40s, middle 40s when they get old at 65 because from then onwards larger and larger numbers will be involved.' The time-frame of 25 years predicted by Philip and Drew was borne out by the Prime Minister. 25 years will be within the lifetime of the majority of our workers. If you look at the demographic pattern, the bulk is around the 30 age group. There is no doubt about it. The Government will have problems of paying out in time to come. I say to the Government, "Be honest. Own up and let us have your solutions to the problems." This Government has created the problem and it has the duty to the public to tell how it intends to solve those problems. The Acting Labour Minister told this House last year that Government has $33.5 billion assets, and most of those assets are in bonds and property. When needed, can the Government liquidate those bonds and property, in particular, property? Property prices are now almost at their rock bottom levels. And we all know a bad investment is consumption. How do we know that the Government's investments are not being eaten up? We need answers from the Acting Minister. No other issue has put the credibility of the Government in question more clearly than the CPF issue. Within a period of six months, we have seen how the Government made a complete turnaround. Just let me quote from the horses' mouth, so to say, from their own Ministers' mouth. Let me first quote the Prime Minister, right from the top: 'The question is: Should we do so? Should we cut future workers' savings for the benefit of employers? No, unless it is an economic crisis. I ask MTI [Ministry of Trade and Industry] economists this question: If one year ago there had been a saving of wage cost by 10% on the CPF and wages, would we have avoided a downturn? Their answer is: No. I asked MTI economists if the downturn could have been avoided if the wage cost, including CPF, were 20% less.... Their reply was that it would have made no difference.' This was in August 1985. Let us see what the Prime Minister said in January 1986: 'One of their [that is the PAP leaders] options is to reduce or suspend a portion of the employer's contribution to the CPF...'. What about his son, the Acting Minister for Trade and Industry? He, BG Lee Hsien Loong, (this is a quote from the Straits Times, 1st August 85) said: 'It was an illusion to think that the CPF rate could be cut without reducing the worker's total wage package. You cannot manipulate CPF in such a way that the employer pays less, and the worker takes back the same.' Now, of course, I have quoted him, and not about six months later, he said: 'I think this 15% CPF cut is a reasonable cut.' What about the First Deputy Prime Minister? On 1st September, 1985, he was quoted in the Straits Times: 'As I have just explained, we do not recommend a wage cut for everybody. CPF contributions are part of the workers' wages. Many workers use them to pay for their HDB instalments. Here, I would like to make it clear that the CPF is not the cause of our high wage costs.' Then, let us see the turnabout on 1st November, 1985. Before I quote that, I will quote another of what he said: 'Wages, we think, is not the main cause of our downturn.' On the same note: 'Even reducing CPF now would not help the economy because the cause is not high wages. If wage costs for the higher technological industries are 50% as we reduce CPF by 10%, I think the actual impact on costs of production will be only 1%.' This again was on 1st November, 1985 in the Straits Times. Now here is the turnaround. On 28th January, 1986, this is what the First Deputy Prime Minister said: 'Employer's CPF rate needs to be reduced by greater than 10%.' Then the changed tune: 'The CPF cut would not adversely affect the present standard of living.' Then again in the same changed tune, on 30th January, 1986, he said: 'I think we can settle for a CPF cut of 15 percentage points.' What about the Acting Labour Minister? Well, this was quoted in the Straits Times on 12th August, 1985 in banner headlines: '4 reasons not to cut CPF. (1) CPF is a pillar of the Singapore economy. (2) It is part of our workers' wages. (3) Contributors will find it difficult to service their housing loans. (4) CPF savings can be used as a form of hard cash in the event of a world banking crisis.' There you are! Solid bedrock of the Acting Minister for Labour. We should ask for his reasons, clear-cut reasons why there is a big change now. He was laughing at me then. I wonder whether he is laughing now. Now in December 1985, four months later: 'The CPF should not be a sacred cow.' The same person saying that, and again the same person on 11th January, 1986 said this. This was quoted in the Straits Times: 'But Mr Lee made it clear that the employer's CPF rate would be cut.' I do not think he is going to deny all these; what he had said. I do not think I would labour you on all this turnaround but surprisingly the only consistent person is the Member for Rochore.

You have spent 10 minutes purely on quotations.

I believe I have got four amendments.

Four?

I will just check and see.

So you are going to spend another 30 minutes on quotations?

No, I will just round it off.

All right. I will give you two more minutes.

Now, it is the cost of production that must be reduced. Far from decreasing shopkeepers' overheads, the Government has increased them. It is escalating like a snowball, that is, gathering more snow. This was in March 1985: 'If all these years increasing CPF rates of contributions have been implemented as purely political ... -

On a point of clarification, Sir. The point is that the Member for Potong Pasir has two amendments in his name, according to the Order Paper Supplement. So I do not know, on what basis, he claims he has four.

Are you afraid?

No, I am not. I would just like to say that there are other Members who want to speak.

Well, I think I have made my point. It is obvious that the credibility of the Government is definitely in question. Thank you, Sir.

Order. On behalf of hon. Members, I would like to welcome the Honourable Heinrich Thomas Becker, the Member of the South Australian House of Assembly, who is present at the Gallery. [Applause].

Debate resumed.

Mr Speaker, Sir, the importance of safety committee needs no further emphasis. When the Safety Committee Regulations were introduced in 1975, the intention then obviously was, and of course still is, to see a self-regulating enforcement system. It goes without saying that if a company has an effective safety committee in which both employers and the employees' representatives are knowledgeable, a high standard of safety could be achieved. Loss of time could be down, accident rate would be down and definitely compensation would also be down. I would like to know, Sir, what steps are taken by the Ministry to ensure that the companies which are required under the Factories Act to form safety committees do, in fact, comply with the regulations. I suspect, Sir, that there are still many companies which form safety committees just to comply with the basic law. Does the Ministry have sufficient staff or inspectors to carry out enforcement of the Act? Sir, it is comforting to know that with effect from 1st September 1985, three more industrial diseases have been made notifiable in addition to the 22 diseases listed in the Second Schedule of the Work- men's Compensation Act. I must commend the Ministry for its efforts to review from time to time the list of occupational diseases. What is more important after identifying the diseases, is how to educate the workforce from contacting such diseases. I would urge the Ministry to continue to organize more courses, just like the unions, or organize health exhibitions on preventive measures, including the use of safety equipment. What is intended to achieve is to increase the degree of awareness. This is one of the surest ways to working smarter. Awareness will not solve all the health problems but it certainly helps to tackle the problem at source. Mr Speaker, Sir, I would like the Ministry to ensure that the National Productivity Board conduct more courses for supervisors, junior managers on human relations so that their middle-management staff could understand and communicate effectively with their subordinates at their work places. These supervisors play a key link role in motivating the workers to work smarter and to be more productive in line with the national effort to upgrade the performance of our workers. I need the assurance from the Minister, Sir.

Mr Speaker, Sir, I would like to place on record the sincere appreciation of a number of my constituents for the help given by the Job Placement Unit of the Ministry of Labour. Sir, not only were the success rates very high but the speed and the manner in which my constituents were treated, is something other Ministries, statutory boards and Government departments may want to emulate. Having said the above, I am a little concerned whether the department can carry on its good work. In fact, for the coming year, Sir, there is a slight reduction in the manpower cost but with the same level of manpower in the estimates. For FY 86, I believe the services of this department will be utilized even greater. There will be more demand for its services in view of the current recession. I am sure most Members of this House will have noticed the increase in request for jobs in our meet-the-people sessions. In view of the increased demand for the services of this department, I hope that the quality of the service rendered by the Placement Unit will be maintained. And I am just wondering how this can be done with the present level of manpower. Maybe the Hon. Minister has some plans to redeploy some of the other members of the staff to this Unit. I hope the Minister will pay some attention to this request. Sir, at the same time, I find that the manpower for the Work Permit Department is maintained at about the same level. In fact, there is a slight increase for FY 86 from $2.18 million to $2.2 million. I would have thought that with the recession we have in our hands, we will be very stringent and, in fact, issue less work permits. So if less work permit applications are being processed, I am questioning the need to maintain the same level of staff as for FY 85. Maybe the Minister can throw some light on this matter.

Mr Speaker, Sir, the Acting Minister for Labour has assured this House not long ago that the unemployment situation is not serious and he cited examples of many jobs which are still waiting for workers. These are, of course, the unpopular jobs. But the fact that these jobs are not taken does not mean that there are jobs for everybody. The question I want to ask the Acting Minister is that if the people can be encouraged not to be choosy, can we assure them that there will be jobs for everyone? Sir, it is true that there are many among the unemployed who are still choosy and they think they can still afford to wait. I think they may live to regret the day that this so-called unpopular jobs may not be there any more. My advice to them is to take on this job now. It is better to have an unpopular job than to have to beg for a job later.

Would you like to take on the job?

And it is better to have some income than to have no income at all. There was a report in the Sunday Times on 23rd March of a local hotel which organized a visit to 11 schools to recruit for 400 vacancies as room attendants, engineering trainees and trainee waiters. Only 40 responded. This is indeed a waste. I think our teachers should be in a position to advise and motivate our students to lower their expectations in times of recession and to take up jobs which are offered. Sir, I also feel that the Employment Service should enlarge its role. During the full-employment situation, the assistance of the Employment Service is only sought when the unemployed are unable to find jobs themselves and the number was small. I am sure with the recession, the situation has changed. I am also concerned about the manpower, the staffing at the Employment Service, as pointed out by the Member for Chong Boon. Perhaps the Minister would like to confirm for us if there is an acute increase in the number of inquiries at his Ministry and whether the Employment Service is coping well with the demand for its service. From what I gather, the Employment Service acts only as a job matching agency. It does not actively and systematically search for jobs for all those who approach the Service. In fact, I think it should also give career guidance and motivate those people who approach the service and motivate them to accept jobs that are offered. So can the Employment Service be enlarged to serve this function? To do that, I think it should be better manned and be more active in looking after the unemployed.

Sir, I just want to ask the Hon. Minister if there has been any change in the regulations regarding foreign workers who intend to marry Singaporeans. When a Singaporean applies to the Ministry of Labour, he or she is usually told that the work permit holder has to be working in Singapore for at least five years. I have come across many cases of Singaporeans who have waited patiently for more than five years, some 7-8 years, and yet no approval has been given. Will the Hon. Minister be able to advise us if there has been any change of policy? And under what conditions will Singaporeans be able to get approval to marry a foreign worker with work permit?

The guillotine time for this Head is 4.40 pm. Mr Chin.

Mr Speaker, Sir, with your permission, may I raise two points. The first point is with regard to the failure of employers to pay to the CPF Board the employee's CPF contributions. I agree with the views expressed by the Member for Kebun Baru and the Member for Yuhua on this matter. Quite a number of employees have found out when their companies were subsequently liquidated that their CPF contributions were not paid into their CPF accounts. These contributions were the employees' own contributions and had been deducted from their salaries by their employers. Apparently, the employers made use of these contributions instead of paying them to the CPF Board. What does the Minister intend to do to remedy this situation? Another point I wish to raise is about notice pay or pay in lieu of notice when a company is wound up. Employees find out their notice pay, together with wage arrears and other benefits, are not entitled to preferential treatment, ie, to be paid in priority to other unsecured debts despite what the law states. The reason is that these benefits, particularly notice pay, are considered to have been incurred by the company after the commencement of winding up. When the liquidated company has insufficient assets, workers will be very unlikely to get their notice pay if it is not considered a preferential debt. Would the Minister take up with the relevant authority to rectify this unintended hole in our legislation?

Mr Speaker, Sir, I would like to thank all the Members who have given constructive comments on my Ministry. With the time constraint, I will try and answer as fully as possible and explain all the queries that have been raised. Before I do so, I would like briefly to say a few words about what the Ministry is doing in reviewing the CPF: why there is a need for a fundamental review and what are some of the areas we are looking at. As Members are aware, the CPF scheme was established in 1955. That was more than 30 years ago, and since then, there have been many changes. Therefore, there is a need to do a thorough and fundamental review of the CPF, to redefine and reconfirm the basic objectives and to avoid straying into extraneous areas. In doing this review, Sir, we have to take a long-term view of the CPF scheme. About 66% of the active CPF members are below 35 years of age. Therefore, we are looking at their retirement 20-30 years from now. We are not so concerned about those aged 50-55 years and above because their number is small. We are looking ahead and so we have to take a long-term view. Over the last one year, my Ministry has already announced various improvements to the CPF scheme to liberalize on the investment outlets and so forth. Further improvements will be made after the study has been completed. In doing this CPF review, we have to look at various factors. One factor is that we think it is better for a younger worker to save up at a faster rate. He does not have dependants whom he must look after and he needs to save up quickly to buy his home and for various other uses. On the other hand, in the case of the older worker, his cash requirements are higher. He needs to send his children to university, for instance. So the thinking of the CPF review committee is that the CPF rate should be progressively reduced as the person gets older. This reduction with age will also help to correct the problem of the seniority wage system where older workers under the wage scale system tend to be paid higher than young workers. So there will be some correction through the CPF mechanism. The other factor to bear in mind is that the CPF is basically a savings scheme. That is an important point to bear in mind. In examining the fundamentals, we want to make sure that we agree on the basic objectives, for old age, for housing, for Medisave and so on, and then confine the CPF scheme as much as possible to those basic objectives. Otherwise, we will be building in a lot of new features. I think there is no point collecting too much CPF by having a very high rate and then getting a lot of pressure to release CPF for many uses, for education, for example. A better approach might be to reduce the rate, say, for older workers from age 40 and above. So they will have more savings of their own in their own banks. And it is up to them whether they want to use the CPF savings for education of their children, for businesses or for other uses. The third factor we will be looking at is how to decide on the appropriate level of the CPF rate. In so doing, we will be looking at the objectives: housing, Medisave and so on. We will also have to decide how much the person needs after retirement in order to sustain him for the remainder of his life. As we know, the life expectancy has gone up over the years. So we have to decide whether we should peg the final savings such that it is enough perhaps to allow him to draw out on his own, manage on his own and use maybe up to 50% of his last-drawn pay. This is something we are looking at: what is the appropriate level. For example, in some countries where they have a pension scheme, the pension may be pegged to his last-drawn pay, at about 40%-50% or above. We will provide in the CPF scheme for amounts to be withdrawn for housing, for Medisave and so on. At the end, after he retires, how much does he need in real terms as a lump sum? And if he manages it properly, he will have enough to live on, say, at about 50% of his last-drawn pay. I have already mentioned that life expectancy has gone up. In 1955, when the scheme was designed, the life expectancy was only about 63 years. When a person retired at 55 years, on average he would live for another eight years, some longer and some not so long. As of now, the life expectancy for a person aged 55 is that he will live for another 18 to 20 years. This is going to go up with improvements in medical science. For example, we have just had our first case of a heart transplant patient, Seah Chiang Nee. We would not have thought of this in 1955 or even one or two years ago. But it is now a reality. And this sort of prolonging of life can only be done at a very high cost. So I think it is a very good idea that every Singaporean should save up enough for his old age. The fifth point is that the CPF scheme should support the move towards a flexible wage system. Personally I would have liked all these studies to have been completed by now so that I can give you the results. Unfortunately, it is a very complex issue. However, I am doing my best to get the committee to complete the studies and have it discussed before the end of the year. As far as the withdrawal arrangement is concerned, I realize that members of the public are very anxious about this point. In the last Budget debate I did mention that the Ministry was looking at the various alternatives. One alternative that I have already explained in the last Budget is that we could hold back a minimum sum of, say, $30,000, including the value of a house. This $30,000 would be enough for a person to live at $150 per month for 20 years. So it is barely at subsistence level. It may seem a big sum now just in terms of numbers, but if you compare it to what a young worker is likely to save up, even a low-salaried worker at age 55, you will find that this is not a big portion of his savings. In any case, for the older workers we will phase the scheme in: beginning with smaller amounts initially, and increasing to $30,000 eventually. In designing this scheme, we will try to minimize the impact and not penalize the majority, just for the benefit of protecting a small group who may not be able to manage their savings. We realize that most members will be able to look after themselves when they retire. I also mentioned last year that we had to look at various possibilities, for example, whether we should distinguish between old money and new money. Money saved up to a certain date may be considered old money and beyond that it should be new money. But all these are still ideas at this point, although our thinking has because more concrete, and before the end of the year we hope to give you the full story. Before I go on to some other points on CPF, I would like to deal with the Member for Potong Pasir's point about whether the CPF is able to pay. This is a very important point. I have given my assurance repeatedly, and I think I have convinced the Member for Anson. Somehow the Member for Potong Pasir refuses to understand. He himself has quoted the figures; saying that we have reserves of over $33 billion. This clearly is more than the total CPF of about $24 billion. It is true we have invested the money carefully in overseas assets. A lot of these are Government bonds. There is no problem selling off those bonds to pay the CPF members. Our reserves position is such that even if today we have to pay off all the CPF members at once, there will be enough money to pay. Of course, such a situation will never happen because people reach 55 years at different times and so, when they do, there will be money for them to withdraw. I think it is important, if the Member wants to be a responsible Opposition Member, for him to understand the position. Philips and Drew has made a mistake. They have been to our MAS and they have got an explanation. If you ask them now, they can tell you what are the areas they have gone wrong. The fact is this. There is no need to go into a lot of accounting here. What CPF does is to collect the deposits from CPF members and lend them to the Government. Government then invests it overseas. And all these years we have been able to generate surpluses, so much so that now, effectively, all the CPF savings have been saved up and invested overseas. One of the problems of the Member for Potong Pasir is that he has a tendency to go into numbers. Unfortunately, as we have seen in this House, he is not very good at numbers. I am sorry to say so. An understanding of this position requires some skill with numbers, like reading accounts and so on. He is under the impression that because, in some distant future, the withdrawals will exceed the amounts put into the CPF, therefore CPF will be unable to pay, as compared to the present, when we put in more than we draw out. Let me give him a simple example. You have a cash box and every month you put in some money. At the same time you also take out some money from the box. But each month you put in more money than you take out. What happens? The money in the box will build up. Subsequently, you decide to take out more money every month than you put in. Would you have enough money to take out from the box when the time comes? The money has been kept there, carefully kept. I have already explained to the House and given the figures which he quoted. We have more than enough. The whole CPF money has been, as it were, put into a box.

Is this our national reserves?

Eventually when the time comes we just unwind the process. The money is still there.

Is this our national reserves?

The money is still there. The money is saved up and invested overseas. It is part of our national reserves.

Mr Speaker, Sir, this is an important question. Is this CPF money, in fact, our national reserves?

Mr Speaker, Sir, I have been trying to answer his point. If he does not understand numbers, he should take some lessons.

Don't debate. Answer my question.

Try and appreciate the point. I have given him a very simple example. Our CPF is like a savings bank. It is the largest savings bank that you can have in Singapore.

They are our money.

Deposits are guaranteed. As of now, because our population is still young, they are putting in more money, as a whole and as a group, than they take out. But come 20 years' time, 30 years' time, when the population gets older, there will be more people withdrawing from that box than putting in. But so long as the amount of money in that box has not been tampered with, has been preserved, carefully invested, as shown in our accounts, (this Government has been very prudent), there is no question of inability to pay. Maybe the Member for Anson can convince him outside the House.

Are they part of our national reserves?

They are savings from our people invested overseas. They collectively belong to all of us as Singaporeans, whether they are CPF savings or other kinds of savings. The Member for Potong Pasir also made a big song and dance about our decision to cut the CPF rate on the employer's side. The position is this. When we first discussed this issue, most of the Ministers in Cabinet, including myself, were strongly against any cut in the employer's CPF because we know it is the pay of the workers, and we should not touch it except as a last resort. As the months passed by and the economic situation got worse and worse - this morning we heard that growth for the first quarter is -4% - we realized that we should not stick to that position. It is better for us to take a cut in the savings than sacrifice jobs.

You should have done it two years ago.

So we had to do it. We were reluctant to do it initially because we wanted to explore all other possibilities.

You were wrong and we were right.

And that we have done. We have explored all other possibilities. We have cut the tax rate, we have cut the tax on PUB bills, we have done so many things. We have exhausted all the possibilities and eventually we decided, "No, our wage cost is too high. We have to cut."

Why don't you admit you were wrong?

You keep on interrupting, Mr Chiam. When you were speaking, no one was interrupting you.

The Minister for Education, who was then the Minister for Trade and Industry, said that this Government is pragmatic. If need be, we are prepared to say, "Look, maybe the first position we took was right at that time. Later on when the situation changes, we will change with it." That shows our flexibility. There is no point for the Government to carry on as if it is always right. When it makes a mistake, it admits it and corrects it. That is what a government should do.

You were wrong.

In the light of the situation at that time, we tried our best to avoid cutting the CPF rate. As things got worse we had no choice. We did all we could. We had to cut. So we are prepared to stand by it now. Whilst on the CPF issue, I would just like to touch briefly on the other points brought up by Members. Firstly, the Member for Kebun Baru who started off the debate by raising the question of late payment of CPF by employers. I have explained the last time that my Ministry is doing the best it can. We have tried to shorten the period before we bring the employers to court. We have also tried to get the Attorney-General's Chambers to expedite the approval for us to prosecute. We have also made arrangements with the courts to give early hearing dates for these cases. The problem now is that we are in the midst of a recession. Although some of the employers are late in their payment, the majority, about 90%, pay up within two months. Only about 10%, or less, have difficulty in paying. And if we now go and get the employers to tell their employees on the very day they slipped on their payment, I think we would unnecessarily be alarming the employees. What my Ministry will do is to re-examine the situation. We are monitoring it. As of now, the situation is not too bad. For example, last year we had about 77,000 employers on the CPF list. Eventually we had to prosecute about 6,200. That is about 8% of the employers. So most employees are all right. And of those employers prosecuted, the majority are still paying back the arrears by instalments. So under the present circumstances, I think we are doing the best we can. We do not want to alarm the employees. At the same time we do not want to push the employers too hard; otherwise they might just go over the brink and the employees will then lose all their jobs. That will be worse off for the workers. One problem is that much of the loans are secured by the company's assets. If we try and go after the assets, the bankers have the first claim. And if we push the employers to the brink, there may be nothing left for the workers. The Member for Jalan Kayu again brought up the question of CPF for education. He added one more P this time to his three P's. I have briefly explained just now the thinking of my Ministry, and I hope this adequately answers his question. As far as education in Singapore is concerned, there is no problem at all. The Government's thinking is that education is so important, and therefore the fees are highly subsidized. Whoever is able to gain admission should have no problem going through the course. If need be, we should liberalize further on the interest-free loans, bursaries, and so on, so that there will be no need to touch the CPF savings. On the other hand if any member wants to send his children for overseas education, it may cost him in the region of $100,000. How many CPF members can afford that? But more fundamentally, should we have that feature in the CPF scheme? I think it is better to have a reduced rate with age. Otherwise once we open up a new scheme for use, there will be a lot of other requests. It is just like taxes. Everybody has some good idea about how to cut taxes or to make use of CPF. The Member for Radin Mas has some reservations about allowing CPF members to invest in stocks and shares, in gold and so on. Actually, it is rather late in the day because the scheme is about to be implemented and we have thought about it very carefully. The key point is that this is really an optional scheme. There is no need for any member to use his CPF to buy shares or gold if he does not want to. But there are some CPF members who feel that they can get a better return from their own investment. So they are welcome to try. They can do it through properties, through shares, through gold, and as we liberalize there will be more and more avenues for them to try out. Those who are not sure of themselves and who do not want to take risks will be well advised to keep their money with CPF. The interest rate is now pegged to the market rates, and with the tax exemption feature, I think it is a very good deal for members. So they have a choice. The Member for Boon Lay spoke about the problem of low income workers and whether we should increase the salary level below which no CPF is payable by the employee. I can understand his concern. We have been looking at this issue in the CPF Board. The fact is that, out of the number in the income group between $200 and $400 per month, only about 8% are actually older workers who may be sole breadwinners. This is the group who may be in financial difficulties. The vast majority are, in fact, single. They are mostly young, maybe below 25 but definitely below 30 and without dependants. So for this group of younger workers, we should really try and encourage them to save. As for the older workers, the better method may be to reduce their CPF rate with age. That way, this group will be helped because when we cut the CPF rate for the older workers who constitute 8%, they will then have more take-home pay for their daily expenses. By doing so, we do not cut the CPF of about 100,000 workers, ie, these younger members, just so this 8% will benefit. I hope the Member will agree with my position. I think I have covered most of the points on CPF. I would like now to deal with the other questions concerning unemployment. The Member for Anson, in his usual style, has been throwing a lot of mud in my direction. Many members of the public who have been assisted by my Ministry realize the kind of efforts my officers have made in trying to help the people to find jobs and they can tell the Member that he has been spreading a wild lie. The fact is that my Ministry is doing its very best. We have deployed more people (I think about 14 more officers) from the Works Permit Department to the Employment Services Department. Last year, through our efforts, we have placed about 3,000 workers in jobs. The majority of the unemployed still decide to go on their own - to find their own work - which is good. But when they come to us, we do our best to help them find jobs. We do not ask them to wait for a job to come along. We refer them to job on the spot. The Member for Anson has been spreading this rumour that we give the unemployed worker a card stamped "six months" and we ask him to wait.

Don't you?

Of course, we stamp on it "six months" to remind the person that if, at the end of six months, despite our efforts he still has no job, come back to us. So the validity period is six months. On the other hand, when he comes to us, on the spot we refer him to a job. Now our intention is, on the spot we refer him to two jobs to give him a better chance of finding a suitable job. So get the facts straight first before coming here and confusing everybody.

The card is stamped six months ahead.

There is a need for this card, Sir, because some members, for some reason, may want to have a specific job and they just keep waiting for the job to come up. Or there may be others who have got a job but refused to come back to us or failed to tell us they have got a job. In fact, we have to trace the records of the CPF to find out how many of those we have helped have, in fact, got jobs. Therefore, we must have a cut-off date. If they are still interested in our service, they should come back to us. But, as I have said, we refer them to a job on the spot.

You got the figures?

He has also made a big song and dance about our not having figures. I have told the House before, in answer to one of the questions, that we have been closely monitoring the retrenchment situation. We have been writing letters offering them our assistance to find jobs. We also monitor these people, from CPF records, to see how many have found jobs. My Ministry also conducts quarterly surveys to find out the actual situation, because we are dealing with large numbers of people. We are dealing with the whole population of workers in Singapore. So it takes time for us, and every quarter, as soon as we can, we update our figures.

You got your figures for 1984 wrong.

I do not know where the Member got the figures. We can check those figures.

They are here - Ministry of Labour, Research and Statistics Report.

They are neither here nor there anyway. These figures are all estimates. I think if there is a difference in the two sources, it is within the margin of error. Last year, there were about 96,000 jobs lost, and the majority were foreigners. Those figures are the correct figures, and they are the relevant ones. I think there is no point in bringing up 1984 figures. We had no unemployment then.

You gave the wrong figures last time.

Since so many Members have shown concern and spoken about the unemployment situation, I think I should just spend a few minutes to put the matter in perspective. As at December 1985, the unemployment rate was 4.9%. As of now, the rate may be closer to 6% because more school leavers have since entered the market. But we must remember that, even in the best of times, the unemployment rate was 3%. In fact, now we may be 2% or 3% above the the full employment level.

I thought there was no unemployment.

This means that there are about 20,000 to 30,000 more Singaporeans looking for work who have yet to find suitable jobs. Compare this figure of 20,000 against the 100,000 foreign workers that we have. If Singaporeans were willing to accept the jobs that foreigners now do, there will be no unemployment problem. My Ministry can control the work permits. We can allocate more jobs. There will be fewer requests for work permits. There will be no unemployment. Compare our situation now to the early sixties when the unemployment rate was 12% to 15%. With the Employment Services Department, as of now, there are about 10,000 people on our list. In 1973, the figures were at their peak, about 27,000 people looking for jobs with the Employment Services Department. Our position now is relatively not as bad as in those years. In those days, the workers were all clamouring round their MPs begging for jobs and willing to accept any job that came. Right now, I am compelled to let in more foreign workers because Singaporeans are unwilling to work in construction sites, in garment factories, in woodworking factories, and even in electronics firms, they are not willing to take on the third shift. That is the fact of the situation. How can we help these unemployed people? The best way is to get them a job, and that is exactly what my Ministry is doing with the support of NTUC and others. Through our efforts many Singaporeans have found jobs. Unfortunately, our experience with job-seekers so far has been disappointing. Many job-seekers who are referred to employers simply do not show up for the interview. I can give him many examples. In the case of NTUC Job Placement Unit (I have a whole list here if Members want to see them afterwards) - NTUC FairPrice, Job: Delivery Assistant. Number required: 20. Number sent: 10. How many turned up: 0. HDB, Post of Electrician. Salary: More than $700. Number of people sent: 20. Three were found suitable but none of them took up the offer because of shift work. This is a good job. $700 with HDB. They did not want to work. I can go down the list. Foster Electric was another one. They wanted production operators. They were offering $400 per month. NTUC offered to send 155 workers. Very few showed up. Five applicants were found suitable. However, none turned up for interview. Of course, the job market is bad. The economic situation is bad. When retrenched workers who are used to high salaries, and they had been paid high salaries because of seniority, now want to get another job, it is inevitable that the employers will just pay them the going rate. So they have a choice - either stay at home without a job and live on retrenchment benefits, live on family support, or take up a lower paid job and do an honest day's work. I can give you another example. This is from my Ministry. A 57-year old Chinese male wanted a watchman's job, after he was retrenched. We made him 11 offers of a job. He turned them all down. We even offered him the job of watchman in a goldsmith's shop. He did not want it because he only wanted to work as watchman in a warehouse. What are we talking about? Do we want to give unemployment benefits? Just look at what is happening in the developed countries? If we offer unemployment benefits, this situation that I have described will get worse, because people will then say, "Well, I will wait longer for my ideal job to come along. Why work?" In fact, studies have shown that in the developed countries as unemployment benefits go up the level of unemployment goes up. More people are unemployed for longer periods.

Nonsense.

Unemployment benefits are like opium. First, you take a whiff, once you get hooked on it, you cannot get out of it. It is definitely not the solution for Singapore. I think many of us have read of instances in developed countries. In USA, there are some families who have not known employment for several generations. Recently, in Australia, the Labour Party government of Bob Hawke is very concerned. Why? Because his young school leavers and other young Australians have not got used to work. They have got used to not working. And he is from the Labour Party - pro-workers. He is trying to do something about it. I have explained in this House before that, from our statistics, if we put the number of jobs notified with us with the number of new applicants and we compare the two based on seven criteria for a perfect match, only about 30% would get a perfect match. What does this mean? It means that people will have to be willing to accept jobs which are less desirable and with lower pay. Employers also have to make adjustments. Some of them are offering wages which are below market rate. So my Employment Services Department tells them, "This is below market. Would you consider increasing it a bit?" And they have agreed. A lot of them only want to employ workers below 30 years old. A lot of people registered with us are above 30. Again, we tell the employers, "Would you consider an older worker?" They would. But of course in the present situation of unemployment, if the employer has several choices of applicants, he will naturally choose the one he thinks most suitable. This process has got to work its way through but the fact is, and we heard it from the Minister for National Development this morning, that there are still plenty of jobs available in the construction industry. Any trainee from the Construction Industry Training Board has no problem getting a job. There is no reason why our able-bodied males from the shipyards who are used to working in the sun should not take up construction jobs. But are they doing it? I am not sure. Maybe some of them are. There is no reason why a girl from an electronics company should not work in a garment factory. You may have read from the papers on 18th March that the NTUC offered to bring 100 retrenched female workers to garment factories. Of the 14 who accepted, 8 turned up and they said, "No, we do not want this job because nobody is smiling." It is true. Everybody is working hard, trying to earn a higher pay.

Because of working conditions.

It is not because of working conditions. Of course, there is pressure because it is piece-rate work. Everybody wants to earn as much as possible. Those who have mastered enough skills can earn maybe $1,000. How about the factory environment? We did a survey of 17 garment factories. Nine of them are air- conditioned. The surprising thing is that some of the girls do not want to work in air-conditioned factories. They say it is too cold and bad for their health. So we cannot please everybody. The working environment, in fact, has improved. I think the problem with the garment factories is that the starting pay is too low. They have a basic pay, and if you want to earn more, you must produce more. It is quite a punishing system. Maybe the garment factories should examine this system and get the help of SDF or other means to help these workers overcome the initial training period. In the electronics factories, the starting pay may be $400-$450. In a garment factory, unless you are skilled, the initial pay may be only about $300 and it takes them perhaps a year to build up skills to a reasonable level. As a result of this problem, plus the bad image of the industry, many garment factories now are employing more than 50%, in some cases as high as 70%, foreign workers. So something has to be done to get the employers to offer more jobs to our older workers, to get them to change the system to attract more local workers.

What are you doing about it?

We are talking to both sides. We counsel all the registrants who come to us. The Member for Telok Blangah was not correct when he said that we just do it passively. We have been reaching out to the employers. We have been discussing with the various employer groups. We also counsel the workers on the spot, to try and get them to change their expectations. In fact, I have got a report here which says, "Our officers in the ESD are really trying their best but some of these retrenched workers are understandably very upset", and so on. In fact, my officers have to take all kinds of abuse from them. In some cases the girls end up crying behind the counter. But they are still doing their best. And I think we heard from the Member of Chong Boon that many of his constituents have found jobs through the services of my Ministry. The Member for Anson made a few wild allegations about the Workmen's Compensation Department. Let me just clarify the facts for him.

They are not wild. It is here in the Auditor-General's Report.

I am coming to it. Between the years 1960 and 1979, the Workmen's Compensation Department recovered and distributed $96.5 million to 238,000 cases. The amount that is left undistributed over this long period is about $156,000 as reported in the Auditor-General's Report. This constitutes only 0.5% of the total amount collected and distributed. Now why has it not been disbursed? It is not because of lack of effort on the part of my officers. It is because a lot of this money is owing to foreign workers who have left and gone home � Malaysians, Indians and others. Many of the amounts involved are below $50 each. We have been trying our best to reach them. But we have not been able to do so. The Auditor-General now recommends to my Ministry that we should put some advertisements in public to everybody, "Here are the money. These are the people concerned. Please come and collect." We have been keeping the money for them for ages. If they do not collect within a certain time, we may have to transfer the money to our Treasury. That is all there is to it.

What about the $349,000?

Most of this money have been accumulated through the years because of this lack of claims. There is one other factor. When this money is kept with the Workmen's Compensation Department, of course, the Department deposits them with various banks to earn interest, which varies from bank to bank, from deposit to deposit. In order to simplify administration, my Ministry pays the recipients a fixed interest rate; otherwise it is impossible to account for all these changes. So partly through this process, some of the money have also been accumulated. Eventually, this money will have to be transferred to the Treasury. So there is no incompetence on the part of my officers. If the Member for Anson knows of any person who has not collected his money, please tell him to come and collect. The money is waiting for him. Again, the Member for Anson has asked why we do not supervise companies which retrenched workers? Why do we not have some laws to protect the workers from this retrenchment? I have tried to explain to him why it is unnecessary. Let me give him some facts.

Because the employers are good people.

By and large, that is true.

Workers are bad.

Workers are also good. It is only he who is saying that they are bad. He is trying to be their champion. What is the situation on retrenchment? We have found from our studies that, in fact, employers generally retrench only as a last resort.

Do they?

We have many examples. Companies like Texas Instruments, Hewlett Packard, were holding on to their workers until they could not hold on any longer. They resorted to lay offs, short weeks and so on. They only retrenched workers as a last resort, partly because they have a feeling for the workers. They are responsible. It is also partly because the unions are there - NTUC is watching over this matter. If there is any abuse, NTUC will be sure to bring this up to us. If the workers are non-unionized, they can write to me and I will look into the case and make sure that if it is dismissal without just cause or reason, the company will have to re-employ or compensate the workers.

That is for the unions. What are you going to do about it?

There is no need to do anything like that. As a result of these companies holding back their workers, productivity last year went down from 6.4% in 1984 to 3.4%. There is no need for us to try and second- guess the management. Management is there to do the job. They know whether or not a job is necessary. They know whether a worker is productive, and which worker is not. What is the market situation? Can they have orders six months' time, 12 months' time? How can we, as officials, go and tell them, "Look, you must not retrench this fellow. You must not retrench that fellow." That will be the surest way to frighten away investors, at a time when we need more investments in order to create more jobs. The solution to our unemployment problem is not more hot air from the Member for Anson but serious marketing efforts - to go out and sell to foreign investors, convince them that Singapore is a good place to invest. This will create jobs. The solution to our unemployment problem is for our workers to accept the situation that there are jobs available, though less desirable jobs but still jobs that can enable them to earn a living. Make the adjustments and my Ministry will do our best to help them. Since I have only a few minutes left, I am afraid I cannot answer all the points. As far as the maid's levy is concerned, I think the Member for Jalan Kayu is aware that people can employ maids from Sri Lanka for maybe $100 per month. You add $120 per month as a levy, and it is still much cheaper than employing a local maid.

Guillotine time.

Sir, in view of the spirited defence of the Minister, I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. The sum of $30,042,910 for Head R ordered to stand part of the Main Estimates. The sum of $21,158,000 for Head R ordered to stand part of the Development Estimates. 4.40 pm

Head V

Mr Speaker, Sir, I beg to move, That the sum to be allocated for Head V be reduced by $10 in respect of Subhead VA-01 Object Group 1100 of the Main Estimates. Sir, during the current recession, many long and well-estabished local trading and engineering companies have suffered substantial financial losses due to the loss of markets, both local and regional. These companies have to reduce the size of their operations as well as the size of their workforce. Concessions, like reductions in corporate tax and CPF contributions, though a welcome move, are not sufficient to help these companies tide over a difficult period. To do so, I would suggest that the MTI consider implementing a Buy Local policy. Such a policy should be temporary in nature and applied only to major construction projects, like the MRT and Changi Airport development, which are awarded to foreign contractors. Some of the engineering and construction equipment like cranes, earth-moving equipment, compressors, etc, brought in by these foreign contractors are readily available locally. The cost may be slightly higher but then we help to save jobs. Engineering and construction equipment purchased locally have a spin-off advantage. Engineers, managers, mechanics and other supporting staff are required to sell and service such equipment. Equipment brought in by foreign contractors are in many instances written-down stocks. After completion of these contracts, some of their equipment are sold off locally as used equipment, thus further depressing the market. Some of these long-established companies which I have mentioned have contributed to the economic development of Singapore for many, many years. They have also helped to develop engineering and managerial expertise in our workforce for a long period of time. Sir, I think the extra cost involved is worth spending if we can save jobs during this difficult period.

Mr Speaker, Sir, our people are most concerned about the present economic downturn. Many people are asking when we could see the start of an upturn and what are the signs of economic recovery. It has been said that economic recovery will depend on both internal and external factors. Internally, we have already introduced measures to make ourselves competitive again. Growth therefore will depend to a great extent on external factors. Externally, we are keen to look out for signs that good times could be coming. Sir, indeed there may be some faint signs of silver linings at the horizon. The positive signs are that world-wide interest rates are low, inflation is under control and commodity prices are falling. One of the most significant recent developments that may have a sharp impact on the world economic recovery is the sharp drop in crude oil prices. Spot oil prices have dropped from a peak of US$37 per barrel in 1980 to US$29 per barrel in 1983. In the last few months, it dropped to below US$12 per barrel. As the OPEC countries are encountering difficulty in reaching a consensus on oil production volume and prices, crude oil prices could remain low. Sir, I would like to ask the Acting Minister for Trade and Industry what is his Ministry's assessment on the impact of falling oil prices on Singapore's economy. On the positive side, falling oil prices will lower domestic inflation. It will lower the cost of fuel oil and electricity and it will lower operating costs for Singapore companies. However, on the negative side, falling oil prices will adversely affect our oil producing neighbours such as Malaysia and Indonesia, which are our major trading partners. Sir, a local newspaper recently reported that a renowned US economist has predicted that the US and the world economy will see a period of sustained economic growth with dropping oil prices. He is quoted as saying that the cheaper oil is singly the most positive event for the world economy. He believes that basically it reverses the oil shocks of the 1970s. He is optimistic that US growth offers hope for a better outlook next year and the following 18 months. Sir, there is another report by a reputabble magazine called the Business Week International, February 10th issue, where the leading article was on "The new world of oil". May I read an extract from the article? It says: 'Cheaper oil means faster growth world-wide. Cheap oil means much more than cheap energy for the world. It is a double shot of vitamin B for the industrial countries, the biggest boost we have in more than a decade. Growth forecasts are going up. Trade deficits and interest rates are heading down and inflation seems dead.' Sir, these are some of the optimistic signs that I would like to look for, so as to inject more faith in ourselves, in our economy. I would like to ask the Minister, that from his Ministry's assessment, whether falling oil prices would have a net beneficial effect on Singapore. Sir, moving on to a different topic, I would like to get some clarification from the Acting Minister on the Jurong Town Corporation. I would like to ask the Acting Minister if he could tell us the current total number of vacant flatted factories and standard factories that have been completed or will soon be completed. In comparison with this supply of vacant flatted factories and standard factories, what is the projected demand? If the surplus of vacant factories is high, I would like to ask the Acting Minister whether he would consider reducing the JTC lease or rental rates so that more of these vacant units could be taken up. Vacant factory units is a waste and there is a holding cost to JTC. As a step to help local companies to cut costs further, the Minister should look into the possibility of reducing JTC rental rates. Sir, I would also like to suggest that the JTC should, in fact, take a lead role as a price leader on factory rental rates. Its role should be to keep the rates of factory rentals low instead of being merely a price follower. For comparison purposes, could I ask the Minister what are the rental rates of similar factories in the private sector in Singapore and the factory rental rates of our competitor countries such as Hong Kong and Taiwan?

Mr Speaker, Sir, I have two amendments under this Head and I would like to speak on them together. I have three points to make. The first relates to the implementation of Government policies. Although the business environment is necessarily dynamic and the Government has to react to changes, I think it is important that the Government must be careful when it comes to balancing the need to make policy changes against the dependence of companies who need the continuity of policies to plan and operate. Most investments take time to show a return and this is true of an investment by a multi-national corporation or that of an individual who invests in a restaurant in Singapore. Whether it is big or small, it needs time. Since time is the essence of every investment, the Government must take the utmost care to examine all aspects of a policy change before implementation. Whether it is pollution control, environmental control or work permit changes, due consideration of the impact on businesses must be studied. Even if a policy change is sometimes necessary, the changes should be phased in gradually. We have many instances whereby the changes are announced and they apply immediately and this makes it very difficult for businesses to react. As long as ample warning is given, businesses will then be in a position to make the necessary changes. I hope the Minister will work closely with other Ministries such as Labour, Home Affairs and Environment or all those Ministries whose policies will have an impact on businesses. The second point, Sir, I would like to turn to the subject of control of statutory boards. The Government has stated that henceforth, statutory boards will not be motivated towards the maximization of profit. This is a timely move and it means that the pricing of a statutory board's services will be oriented towards cost recovery with a small margin. As already mentioned by the Minister for Finance, the previous pricing policies were necessary as surpluses were needed for development expenditure. However, with profit maximization by the statutory boards then, it meant that the statutory boards could work towards optimal efficiency, cost effectiveness and improved productivity. With profit maximization motive now removed, how can we ensure that the statutory boards will continue to be efficiently run? Will there be the motivation to seek productivity improvements? Will they make sure that they will maintain their costs as low as possible? I think some appropriate measurement criteria are necessary, especially for those boards which charge for their services. Will the Minister consider the introduction of some measures so that statutory boards' performance may be measured? Finally, Sir, my other amendment is on the Product Development Assistance Scheme (PDAS). Last year, during a similar debate, I lamented on the inadequacy of the PDAS and I asked that this scheme be extended to include the payment for international licensing. Last year, 16 companies were granted a total of $1 million under the PDAS. I personally have my doubts as to its effectiveness and success. How do you measure the success of PDAS? The success must be measured by whether commercial sales are generated by the product which has been developed. To improve the chances of success, I think licensing is definitely more effective as a licence will enable the licensee, which is usually a small company, to manufacture commercially viable products. Since the Economic Committee has directed that the PDAS be liberalized to promote aggressively and more product development activities, I urge the Ministry to review this scheme to include licensing.

Mr Speaker, Sir, I would like to touch on two points pertaining to the Public Utilities Board, namely, PUB tariffs and PUB reserves. Presently, Singapore is totally dependent on imported oil for its energy needs. As much as 60% of the PUB's total operating expenses goes towards the financing of fuel oil imports and/or fuel oil stocks. I am aware, Sir, our fuel oil purchases are subjected to world-wide oil price fluctuations which are beyond our control. As already mentioned by the Member for Thomson, crude oil prices have dropped sharply to a new current low of around US$12 per barrel. The savings derived from the lower cost of importing fuel oil have indeed benefited consumers who not too long ago enjoyed lower PUB tariffs effective 1st November 1985 and 1st February 1986 respectively, with the next adjustment due on 1st May 1986 in line with the PUB's policy of a three-monthly price review. With this current trend in oil prices, consumers are looking forward to further revisions down the road. Sir, this is because they are aware that to date, the PUB has accumulated a sum of $180 million in reserves which is indeed no small amount. At the same time, we know that the PUB is continuing its efforts to look for alternative sources of fuel in keeping with its objective to diversify energy sources to promote energy conservation and the efficient use of electricity. Against the scenario I have just described, Sir, I would like to pose the following questions to the Acting Minister. In view of the decline in oil prices and the glut in oil supply, what is the scope for lowering PUB electricity tariffs in the immediate future? My second question is whether alternative sources of fuel which are cheaper or competitive with fuel oil are now available for use by the PUB. Finally, Sir, how does the PUB propose to utilize its reserves and what are its development plans?

Mr Speaker, Sir, when we are in the midst of a recession, it is only natural that we are concerned with our own problems. We analyze our problems. We formulate measures to counteract the recession, to try to get out of the recession. But at the same time, other countries, like our nearest competitors, Hong Kong, South Korea and Taiwan, are also looking at their own situation and coming out with their own measures to maintain their share of the world market, and to compete effectively. So how we can get out of this recession would depend on how fast we can take measures to counteract the recession and get out of it, and on whether we are able to work faster than our competitors. While our nearest competitors may be Hong Kong, Taiwan and South Korea, other countries that have been similarly affected by the recession have also been doing their own analyses and coming out with arguments and conclusions which are all too familiar to us. I came across a report in the Australian, 15th March 1986, and I would like to quote some passages from this report to show the similarity of their problems with ours. One of the measures which the Australian Government took a few years ago to help regain the competitiveness was to devalue the Australian dollar. Here in Singapore I think there have also been arguments for a devaluation of the Singapore dollar because there is added to our problems of price competitiveness. Here this report says: 'The devaluation of the dollar was meant to open a brave new era for Australian manufacturing. But the revival is slow in coming and some economists are arguing that manufacturing is in such a bad way that devaluation will have an overall negative effect.' They have already devalued. Now they are finding that it is not working. Why? I quote again. 'Manufacturing imported such a heavy proportion of components for their products that the high cost balances out the competitiveness.' So, again, an argument which we found very familiar in the last few months. I quote again. 'Suppliers abroad who can expect much greater productivity in their own work forces than is possible here [in Australia] and so can rely on out-competing Australian products within a couple of years.' So economists in Australia have come to the conclusion (at least some of them have come to the conclusion) that at this rate we would need a devaluation every year to remain competitive. I think the lessons which the Australians have learnt are useful for us. Another factor that has been identified as a problem for the Australians is: 'The system of wage indexation and centralized wage increases which builds unrealistic cost pressures into an apparently unbreakable cycle.' We do not have indexation. We have the National Wages Council, and again the arguments of wage costs being built into the wage system are all too familiar. A third factor which has been identified as a problem, and here I think we should take note very seriously, is: 'Low levels of investment in Australian manufacturing during the past 10 years which means plant and equipment are not in place to provide a regeneration of manufacturing either through import, replacement or producing new lines of export. Lack of confidence among investors about the likely returns on investment in manaufacturing and the increasing tendency for investors to look overseas for better returns.' One of the Australian economists has said, "People are saying, where do we get the best return and moving overseas?" That is why the Australians have not attracted the investments that they want to regenerate a recovery in the manufacturing industry in Australia. I think the lessons here are useful for us, as we face our own economic problems. We have got to take note of how others have analysed their own problems and the measures they are likely to take. What is critical for us at this stage is that we want to attract investments so that we can create jobs for those who are out of work and for those who are coming out to look for jobs. So we need to make this place a place where the returns are more favourable compared to our competitors, compared to even countries like Australia. We have one advantage which we must exploit to the fullest, ie, our small size. Being small has its disadvantages, but it has also the advantage that we are able to move quicker, ie, if we have the will to move faster, to come to grips with our problems, to work together, Government with the people, workers with employers, to face the recession, to take whatever measures that we need, to counter the recession, to attract investments, to get out of it as quickly as possible. I think at this critical juncture it is necessary for us all, as Singaporeans, to look at ourselves, to look at where we stand, to acknowledge that we are all facing one common problem, and to respond as a people. We have to take advantage of our smallness, our ability to respond faster than other countries. If we are able to give the right signals to investors overseas, then we stand a far better chance of being the first to attract them to come to invest in Singapore and thereby safeguard our own interests, the interests of the people, the interests of the nation. In this respect, we would have to take note also of one important factor which has been enunciated in the Economic Committee's Report, and that is, the educational level of our workforce. We have an inherent disadvantage at the moment. It is a problem we recognize and we have to overcome it as quickly as possible. The Government has announced a $3 billion extra expenditure on education. I think that while it is important that we invest in the new generation of workers from pre-primary to the University, we must pay equal attention to those who are in the workforce, many of whom are still young and require to get the skills so that we have a qualitative uplift in the quality of education of our workforce. In this respect, I think we should make full use of the Skills Development Fund to redirect our energies, the resources available in the Skills Development Fund towards the upgrading of our workforce. I hope that the Ministry of Trade and Industry will work closely together with the Education Ministry and the other appropriate Ministries to have together a coordinated plan for the qualitative upgrading of the present existing work force.

Sir, the setting up of the Small Enterprises Bureau is definitely a timely move as our small industries have been in great need of Government assistance and support. Currently about 30% or 270,000 of our workers are employed by the small and medium-sized industries. It is very important that the service and assistance provided by the SEB will also benefit this group of wage earners in enhancing their job security. Our small local industries are facing a lot of problems and I would like to highlight some of them here. The first is that many of the small industries are facing temporary cash flow problems. Such problems will have a chain effect on other businesses, as many of them have established a close business relationship with one another. I have been told that hundreds of shop tenants and industrial tenants of statutory boards are not able to pay their rentals. If legal action is taken against them, many of them will go bust and our workers will lose their job. My view is that our statutory boards should not take the lead in forcing these firms out of business. My second point concerns the Skills Development Fund and the Small Industries Finance Scheme. As the small local industries are not as professionally managed as their big multi-national counterparts, they may have difficulties in drawing up plans and submitting applications to the SDF for training grants. In this respect, I would like to urge the SDF to be more sympathetic and flexible with the local firm. They should conduct more direct discussions with the local businessmen to ascertain their training needs. I would also like to see a separate set of approval criteria for the local industries, so that the unique needs and special circumstances facing our local industries, can be taken into consideration. On the other hand, as the loans under the Small Industries Finance Scheme are not interest-free, I feel that the EDB should be more relaxed in granting loans to our local industries so that more local firms can be saved from going bust. The EDB should also help nurture local enterprises by entering into partnership within potential industries and withdraw from the business after the firms have been nurtured into public-listed companies. Last but not least, our small local industries also face difficulties in looking for markets. I am pleased to note that the Trade Development Board and the SEB have been helping them in this area. But I feel that the Government being the biggest purchaser should consider buying more from local enterprises and try as far as possible not to compete with them. Although the philosophy of free competition is upheld, a minimum level of protection must be given to the local industries. I would like to point out that free economies like Japan and America also protect their own enterprises. In conclusion, I would say that with the efforts of the people and the support of the Government, our Singapore label products will be able to attain a good reputation and popularity in the world market.

Mr Deputy Speaker, Sir, I would like to speak a few words regarding the manpower problems of the hotel industry. Sir, the hotel industry is a labour-intensive service-orientated industry. Even in this recession, new hotels which are reaching completion have no choice but to open their doors for business. So there will still be an increasing demand for more workers in the hotel industry overall, while in specific hotels retrenchments may be going on. In order to meet the needs of the industry, the manpower needs of the industry need further study. The needs are (1) upgrading of the present workforce; (2) the need to attract the better educated to join the industry; and (3) the need to further intensify supervising, training and education programmes. Sir, the Singapoore Hotel Association in 1983 made a manpower study of 15 hotels. The results of this study show the urgent need to upgrade the workforce. (1) 38.2% of the workforce in the basic grades have only primary or no education at all. (2) 16.3% of the workforce in the supervisory grades have only primary or no education at all. (3) 5.5% of the workforce at the middle management level have only primary or no education at all, and 40.2% have only lower secondary education. It is to the credit of our present workforce and the industry that, despite the lack of formal education through inhouse and vocational training, they have been able to provide a standard of service in our hotels that is second to none. Sir, today the training of the industry is provided for by inhouse training schemes and in the main by SHATEC (Singapore Hotel Association Training and Education Centre) which is jointly managed by the Singapore Hotel Association and the VITB. Sir, the cost of training in SHATEC is high, due to its specialized nature or function. Training in SHATEC is made possible only through sponsorship by the employers, ie, the hotels, together with the subsidy from the SDF. For example, the Diploma in hotel management course costs $21,000 payable over three years, that is $7,000 per annum. The SDF offers 70% subsidy of course fees and absentee payroll. For the 48-hour advanced food preparation course, the cost fee is $1,000 and SDF provides for 50% subsidy. Sir, now that the industry is in troubled times, training and education may not receive priority by the hoteliers as the priority now is to cut cost and survive the current economic woes. It is within this context that it is suggested that the SDF can play a bigger role in supporting training. The SDF can do this by (1) increasing the quantum of SDF subsidy; (2) broadening the subsidy to trade unions and trade associations that seek to upgrade the skills of its members. I would like to ask the Minister to look into this problem. Sir, if we are to achieve our aim of being a net exporter of hotel management and services, we must build a large pool of skilled workers at all levels in the industry. However, a school leaver, whether 'N', 'O' or 'A' levels, cannot now opt to enrol in SHATEC as he would in other institutions of higher learning, for example, the Polytechnic, Ngee Ann, VITB, NTI or NUS. This is because of the high course fees which I mentioned earlier. Sir, a way must be found to overcome this problem. It has been suggested that to fulfil our manpower needs, a second hotel training school will be required to meet the demands of industry for skilled workers. Perhaps this second school should be managed along the same lines as the VITB institution so that the school leaver will find it affordable to enrol in it. The new hotel school should provide more broad-based basic training. SHATEC can then concentrate on the more specialized area of skills training. Only in this way can we hope to attract more talent into the industry.

Sir, foreign investments in Singapore have always been the backbone of our island state economy. In the process of providing jobs and sub-contract businesses for our workers and our local businessmen, they have substantially raised our level of technological skills. This has enhanced our international competitiveness. It is no accident that our Ministers gave top priority to the keeping of the multinationals here as long as possible and at the same time harnessing all efforts to attract more foreign investments into Singapore. These desires are not just mere words. Our Ministers will be going overseas shortly to meet potential investors. These potential investors in US and Europe are tough businessmen. They do their homework very thoroughly. For Singapore it is not going to be easy. We have to compete with Hong Kong, Taiwan and South Korea for a slice of investments. With the positive cooperation of our workers to make Singapore competitive, half the battle is won. The rest depends largely on follow-up action. Sir, though it is true that our businessmen will have to be diligent and efficient in following up, I feel that the overseas outlets of the EDB and the TDB have become the crucial link to success. But, Sir, many of our outlets are manned by only one or two staff and in a big country the number of opportunities outnumbers the time the one or two staff can give. Much as we want to say that it is the qualitative time of the staff that matters, we cannot deny the working of the law of chances, which stipulates that the greater the number the greater the chances of success. I sincerely hope that the Acting Minister will review the combined EDB and TDB overseas outlets and increase the number of officers. It is then hoped that with more officers, more qualitative time can be expended. Sir, in the consideration to increase the staff strength, some thoughts should be directed at the type of personnel. In most of these outlets, most of our officers are Singaporeans and in these vast countries, many times the size of Singapore, it will take too long to familiarize the business environment. Time is what we can least afford. I suggest that we employ the locals of the respective countries to supplement and complement our own staff. This will redeem our time and increase the depths of our coverage. Sir, in the early days, the EDB and TDB started with very specific terms of reference. The EDB is to attract foreign investments and the TDB is to assist in exports of our goods. Today, many of the services overlap each other. For example, in the case of a possible joint venture, which body should attend? And if a local manufacturer is both a contract manufacturer as well as one who produces his own products for export, and if he is looking for a joint venture in Singapore, who should he approach? EDB or TDB or both? In some countries, the EDB office and the TDB office are next to each another. A potential investor is often unsure which office to call. I have come across potential investors calling on both EDB and TDB. Even our Singaporean businessmen call on both for assistance. I feel that this is time-consuming, unproductive and confusing. It will be a good idea to streamline the services and to present them as only one outlet. I hope the Acting Minister will comment on this. Sir, I wish to move to the Market Assistance Scheme offered by the TDB. The Minister of State said that $680,000 has been granted to 83 companies since the scheme started last September. This works out to an average of $8,192 per company. As a scheme, this is definitely a good and right move but as to its effectiveness, I have my doubts because you cannot sustain a marketing programme with such a small sum unless the marketing programme is so well planned. I can only suspect that such a sum is for a once-off activity and this is not beneficial to our economy in the long run. Let us be bold in this area. Unless we support properly worked-out marketing programmes requiring substantial amounts of money, it may not be worthwhile offering such schemes. I suggest that the TDB assist local companies in mapping out a comprehensive marketing plan and then offer them the grant to meet it. In this way, the chances of some companies doing well in exports will be greater.

Sir, I shall take up some of the points mentioned by hon. Members. First, the Member for Toa Payoh spoke on the need to have a Buy Local policy, particularly for those large contracts which require a lot of engineering machinery and equipment. I agree that in the short run such a proposal will help to save jobs. It will keep some of our local companies, which are in the business of selling equipment, in business. However, in the long term, a policy to enforce local purchases will become regressive and lead to loss of economic efficiency. A Buy Local policy will be contrary to our free trade policy. It will offer protection of an exclusive group of traders here in Singapore who are already in the business. Sir, if local agents and manufacturers are unable to compete with imports made directly from overseas manufacture by their end-users in Singapore, then any protection measure or any Buy Local policy can only be a temporary respite. A more permanent and effective remedy is for these agents and manufacturers to develop greater competitiveness, greater efficiency and productivity in their business and to be able to compete with successful tenderers who might be tempted to import their equipment directly. A domestic market catering to the needs of only 2(r) million people cannot afford to be protectionistic. Restriction on imports must eventually lead to higher cost for local consumers and local taxpayers. Therefore, it is the Government's policy goal to develop Singapore as a free trade city. There will be, as far as possible, no tariffs and other barriers to trade. Trading will be expedited by a simpler system of trade documentation. There should be minimum custom hindrance to the inflow and outflow of goods. The Member for Thomson sought the view of my Ministry on the effects of the decline in oil prices. As he himself has pointed out, the most obvious impact would be a reduction in cost to our industries. They will pay less for their energy needs. They will pay less for the raw materials which they import. To Singaporeans, it would also mean a reduction in cost of our essentials. In other words, we will be able to look forward to a lowering of our inflation. But there is another side to the story which, as the Member for Thomson himself has pointed out, Singaporeans ought to remember. This feeling of elation that oil prices are tumbling should be tempered with an understanding of the full effect of a severe drop in oil prices. The drop in oil prices must have a negative effect on our neighbours' economy, some of which are so dependent on oil as their main export earner. It will hamper their growth, reduce their purchasing power and, in general, dampen regional trade. A deterioration in regional economy cannot be expected to be so remote from Singapore that we are protected from it. It is only natural that if such a reduction in regional trade takes place we, as a major trading nation here, will have to suffer the consequence. Overall, my Ministry views the drop in oil price and its full impact on our economy as being of an uncertain nature at this stage. We would not like to say that it is all positive. Yes, we can look forward to some advantages, both to consumers and to industries. But we have to be prepared for the backwash of the same drop in oil prices causing an effect on our neighbours' economy. The other point taken up was on the PUB. Before moving on to the PUB, I would like to take on the point that the Member for Thomson has spoken regarding JTC. JTC's responsibility is to ensure a ready supply of prepared land sites and flatted factories or other standard factory buildings to meet the needs of investors, both local and foreign. At the same time, the Corporation has to ensure that it does not incur too high a holding cost which is the cost that the Corporation has to expend between developing the land and selling the land or renting out the factories. The ideal policy is to maintain only a sufficient stock for one year's need. However, it is difficult to ensure an accurate balance of supply and demand. Demand can change much more rapidly. Supply, on the other hand, has to take several years. Land has to be cleared and the infrastructural requirements have to be put in, roads have to be built, drains and sewers have to be put in, factories have to be built. In practice, JTC is then obliged to hold two to three years of anticipated demand in land sites. In the case of industrial buildings, JTC holds a one-year stock of requirement.

Order. It is 5.30 pm. Thereupon Mr Deputy Speaker left the Chair of the Committee and took the Chair of the House.

Mr Deputy Speaker, Sir, I beg to report that the Committee of Supply has made further progress on the Main and Development Estimates for the financial year 1st April, 1986 to 31st March, 1987 and ask leave to sit again tomorrow.

So be it.

Resolved, "That Parliament do now adjourn." - [BG Lee Hsien Loong]. Adjourned accordingly at Half past Five o'clock pm.