Hansard, 1993-07-30

Under the provisions of clause 2(d) of Article 46 of the Constitution of the Republic of Singapore, the following Members have been granted permission to be or to remain absent from sittings of Parliament (or any Committee of Parliament to which they have been appointed) for the periods stated:- Dr Wang Kai Yuen - from 3rd to 6th June, from 12th to 13th June and from 15th to 24th June, 1993. Mr Chiam See Tong - from 4th to 12th June, 1993. Dr Wong Kwei Cheong - from 6th to 10th June, 1993. Mr Peter Sung - from 7th to 11th June, from 18th to 22nd June, from 2nd to 11 July, from 20th to 21st July and from 16th to 20th August, 1993. Mr Chew Heng Ching - from 7th to 19th June, from 12th to 13th July and from 19th to 22nd July, 1993. Mr Chia Shi Teck - from 7th to 8th June, 1993. Mr Leong Horn Kee - from 9th to 14th June, from 29th June to 10th July and from 21st July to 14th August, 1993. Mr Goh Chee Wee - from 9th to 26th June and from 29th June to 3rd July, 1993. Assoc. Prof. Low Seow Chay - from 9th to 12th June and from 28th June to 3rd July, 1993. Dr Ho Tat Kin - from 11th to 24th June, 1993. Mr Wong Kan Seng - from 12th to 17th June and from 14th to 16th July, 1993. Mr Chay Wai Chuen - from 12th to 26th June, from 29th to 31st July, from 1st to 8th August and from 10th to 13th August, 1993. Assoc. Prof. Ho Peng Kee - from 14th to 25th June, 1993. Encik Othman bin Haron Eusofe - from 14th to 21st June, from 4th to 10th July and from 15th to 18th July, 1993. Mr Chin Harn Tong - from 14th to 18th June and on 30th July, 1993. Mr S. Chandra Das - from 15th to 22nd June and from 26th to 28 July, 1993. Mr Peh Chin Hua - from 16th to 20th June, from 23rd June to 4th July and from 19th to 22nd July, 1993. Dr Wan Soon Bee - from 16th to 19th June, from 28th to 30th June and from 5th to 14th July, 1993. Dr Ker Sin Tze - from 17th to 19th June and from 4th to 10th July, 1993. Mr Kenneth Chen Koon Lap - from 17th to 19th June and from 19th to 22nd July, 1993. Mr Eugene Yap Giau Cheng - from 18th to 27th June, 1993. Mrs Yu-Foo Yee Shoon - from 19th to 26th June, 1993. Dr Ahmad Mattar - from 20th June to 1st July and from 25th to 30th July, 1993. Mr Low Thia Khiang - from 21st to 26th June, 1993. Mr Tong Kok Yeo - from 21st to 27th June, 1993. BG Lee Hsien Loong - from 21st to 26th June, 1993. Mr Yeo Toon Chia - from 21st to 26th June, 1993. Encik Yatiman Yusof - from 21st to 27th June, 1993. Dr Yeo Ning Hong - from 22nd to 28th June and on 10th July, 1993. Mr Matthias Yao Chih - from 22nd to 25th June, 1993. Dr S. Vasoo - from 22nd to 28th June, 1993. Mr Choo Wee Khiang - from 22nd June to 6th July, 1993. Mr Charles Chong - from 22nd to 25th June, 1993. Mr Zulkifli bin Mohammed - from 23rd to 27th June, 1993. BG George Yong-Boon Yeo - from 27th June to 1st July and from 4th to 10th July, 1993. Mr Lim Boon Heng - from 28th June to 2nd July and from 4th to 9th July, 1993. Mr S. Dhanabalan - from 28th to 30th June, 1993. Mr Davinder Singh - from 28th June to 4th July, on 20th July and from 27th to 28th July, 1993. Encik Sidek bin Saniff - from 28th June to 1st July, 1993. Mr Tan Soo Khoon - from 29th June to 2nd July, from 7th to 8th July and from 13 to 17th July, 1993. Dr John Chen Seow Phun - from 2nd to 14th July and from 29th to 30th July, 1993. Mr Bernard Chen - from 3rd to 12th July, 1993. Mr Koo Tsai Kee - from 4th to 10th July and from 19th to 25th July, 1993. Dr Tony Tan Keng Yam - from 4th to 11th July, 1993. Mr Lew Syn Pau - from 4th to 10th July, from 26th to 28th July and from 30th July to 1st August, 1993. Dr Ong Chit Chung - from 4th to 10th July, 1993. Mr Lee Yiok Seng - from 12th to 28th July, 1993. Dr Tan Cheng Bock - from 14th to 26th July, 1993. Mr Heng Chiang Meng - from 19th to 22nd July, 1993. Mr Loh Meng See - from 22nd to 24th July, 1993. Mr Lee Yock Suan - from 26th to 29th July and from 23rd to 27th August, 1993. Mr K. Shanmugam - on 30th July, 1993. Mr Ch'ng Jit Koon - on 30th July, 1993. Dr Tay Eng Soon - on 30th July, 1993. Dr Koh Lip Lin - from 6th August to 4th November, 1993. TAN SOO KHOON Speaker Parliament of Singapore

The following Bills were assented to by the President of the Republic of Singapore on the date stated: 9th July, 1993 (i) Computer Misuse Bill 1993; (ii) Moneylenders (Amendment) Bill 1993; (iii)Pawnbrokers (Amendment) Bill 1993; and (iv) Companies (Amendment) Bill 1993. TAN SOO KHOON Speaker Parliament of Singapore

asked the Minister for National Development whether he will implement any controls on the sale of overseas properties to Singaporeans as sales by overseas property developers are on the increase.

asked the Minister for National Development if he will implement measures to ensure that advertisements and exhibitions for sale of overseas properties in Singapore, whether by overseas developers or local agents, do satisfy rules and conditions of sales comparable to those of local development sales in Singapore.

Mr Speaker, Sir, with your permission, I would like to take Questions Nos. 1 and 2 together as they are related.

All right.

In recent months, there has been a sharp increase in the promotion and sale in Singapore of overseas properties. This is to be expected as, with our growing affluence, many Singaporeans will consider investment opportunities, both local and foreign. Developers of properties overseas and their agents will naturally target Singaporeans as potential buyers. Those who purchase overseas properties do so for investment purposes. As with other investments, potential investors should do their homework carefully, weighing the risks involved against the possible returns. It must be stressed that Singaporeans buying properties overseas do not enjoy the protection of the Housing Developers (Control and Licensing) Act and its subsidiary legislation. The laws in place to protect the interest of home-buyers in Singapore do not cover Singaporeans investing in overseas properties. Different countries have different rules and regulations to control their property developments. It is not feasible for Singapore to extend the Act to regulate purchase of foreign properties. At the present time, there is no existing legislation dealing with the advertising, promotion and sale of foreign properties in Singapore. This has not been necessary in the past because there have been few such offers and, when made, they have been generally directed at companies or sophisticated buyers. However, the recent spate of advertisements and promotional road shows are directed at the public at large, including a large number of first-time buyers of foreign properties. As this trend is likely to persist, Government is considering the introduction of specific legislation to regulate the marketing of foreign properties in Singapore. As this may take some time, Government has recently introduced several interim measures to weed out bogus sale of foreign properties - local estate agents are now 2required to check the credentials of the foreign developers and their projects before acting as their marketing agents - advertisements on new foreign properties must list the necessary permit numbers from the relevant planning and building authorities. Prospectuses for the properties on offer should also be published or made available to potential buyers - permits for property exhibitions will only be granted if the developers can furnish documentary proof of their planning and building authorities' approvals for their projects. These measures will help to establish that foreign properties marketed in Singapore are from bona fide developers who have obtained the necessary approvals from their relevant authorities. However, I must stress that we do not have any control over the development of foreign properties outside Singapore. Nor is it possible for the Government to check on the authenticity and accuracy of the descriptions of foreign properties offered for sale in Singapore. Like other forms of foreign investment, Singaporeans purchasing foreign properties should carefully weigh the risks involved.

asked the Minister for Trade and Industry, as the 1992 basic wage increases continue to outstrip productivity growth for the fifth consecutive year, what measures have been taken to narrow this wage-productivity gap to ensure that the Singapore economy remains internationally competitive.

Sir, Mr Chua is right that real basic wage growth has outstripped productivity growth for five years, based on figures released by the National Wages Council (NWC). The picture painted by the Ministry of Trade and Industry's more general measure of wage growth (which includes non-bargainable employees, unlike the NWC figures) is similar to real wage growth has outstripped productivity growth in the last four years. Please refer to Chart 1 (Cols. 373 - 374) which has been circulated by the Clerk of Parliament. Chart 1 - REAL WAGE GROWTH AND PRODUCTIVITY GROWTH (Cols. 373 - 374) Since the second half of last year, the wage-productivity gap has narrowed as economic growth picked up. For the first quarter of this year, productivity growth was 4.7% and real wage growth 3.7% In the short term, it is not possible to manage growth such that real wage growth and productivity growth are always in line. With cyclical changes in demand and restructuring, over- and under-shooting are to be expected. For example, real wage growth was below productivity growth during the period 1986-88. Over the longer-term, the only sure way of maintaining competitiveness is to improve productivity and ensure that labour cost increases do not exceed productivity increases. Government's measures have concentrated on the supply-side to improve the quality of our human resources. Each cohort of students entering the labour market is better educated than its predecessors. For example, 24% of the labour force now have post-secondary and university education, compared with 14% in 1982. The improvement will continue as the education system has been restructured to give every student at least 10 years of basic education. For workers already in employment, the Government has already set up various programmes to help them acquire skills and upgrade themselves, eg, BEST, MOST, WISE, FAST FORWARD and TIME programmes. The Government has also encouraged restructuring of the economy towards higher value-added and knowledge-intensive activities, including research and development. These efforts have borne fruit, as evidenced by the higher skill and knowledge content of new investments in the manufacturing sector. In 1992, 16% of workers in the manufacturing sector were professional and technical workers, compared with 6% in 1982. At the same time, the Government has encouraged the private sector to distribute their more labour-intensive activities to other regions. The Government can only ensure that the education system and worker training programmes are relevant and sufficient for the needs of industry. But productivity improvements in the workplace must primarily be the responsibility of employers. Employers must invest in training for their own needs. In 1992, the Government set a target for companies to double their training investment from 2% of payroll to 4% of payroll by 1995. This is the amount that world-class companies spend on training. In Singapore, while larger companies (ie, those employing 500 or more workers) exceeded the 4% target, smaller companies were still some way behind. This is seen in Table 1 (Cols. 375 - 376). Table 1 - TRAINING INVESTMENT AS PROPORTION OF PAYROLL, 1992 (Cols. 375 - 376) Singapore can retain its position as the most competitive NIE if all groups continue to concentrate on the fundamentals.

asked the Minister for Finance, in the light of the recent report of the disappearance of huge sums of money in a country's financial reserves, whether Singapore's reserves are safe, intact and growing, and whether our control systems are adequate to prevent a similar occurrence.

Mr Speaker, Sir, the answer is yes, we have instituted proper control systems to monitor and keep track of our country's financial reserves. There are adequate checks and balances in the system to ensure that investment operations are properly accounted for. Key investment decisions are made by top management of the agencies managing the reserves, namely, the Monetary Authority of Singapore and the Government Investment Corporation. Regular reports are made on the performance of the investments and the position of our reserves. The accounts and control systems are subject to the examination of internal auditors within the respective organisations as well as the Auditor-General. Furthermore, Articles 22B, 22D and 148A of our Constitution protect reserves accumulated by past governments from being drawn down by the current Government. It should also be noted that the income earned by the investment of the protected reserves is not available for spending by the current Government but accumulates to the reserves. This means that the size of the reserves will grow over time. Let me assure the Member that our reserves are safe and intact and unless we become spendthrift and profligate, will keep growing.

Sir, will the Minister tell us the size of our reserves and whether the size is based on our cost or the present market value of our assets?

I have answered this question at a previous sitting of Parliament. Currently, the totality of our foreign reserves is around $65-66 billion and that is based on current market values.

Mr Speaker, Sir, will the Minister please tell us how much of the reserves invested come from CPF money and what is the rate of return? The second question is: could some of the extra earnings that are derived from this investment be channelled back to CPF members?

CPF funds are managed by Government through the issue of bonds. The money is transferred from the CPF to the Government in exchange for Government bonds in which they earn interest, and the returns are adequate. As far as the proportion is concerned, the figure I mentioned earlier is the official foreign reserves. In addition, the Government has other reserves held in Singapore and elsewhere. CPF funds are totally protected.

Sir, I know that Government bonds are bought with CPF money. But what happens to the money with which Government bonds are bought? Is the money not further invested?

The bonds issued to CPF Board carry an interest rate. The interest is tax-free to the CPF Board and this accumulates to the CPF funds. The money collected by Government through the issue of these bonds is then invested in a variety of instruments, both domestically and externally, by the Government Investment Corporation.

This is what I would like to know from the Minister. What is the rate of return? The reason I am asking this question is that I think the CPF Board gives us a return which is more compatible with short-term lending but CPF money is given on a long-term basis. So I want to ask what is the return from Government bonds so that we could channel this back to the CPF members' accounts.

The bonds are issued on published interest rate and I can supply the figure to the Member if she wishes. But it is more than adequate. The reason why they are issued against a specific interest rate, rather than channel all the money directly back, is that Government, in managing the reserves, assumes all capital risks whereas there is no risk to the CPF members. Therefore, it cannot be exactly the same. Though the earnings may vary from time to time, the interest rate payable to the CPF Board is more or less the same.

asked the Minister for Finance whether the penalties provided in the Securities Industry Act for market rigging and related offences are adequate to deter such behaviour and to ensure that manipulators are deprived of the proceeds of their crimes.

Sir, before I ask the Question, I want to make a declaration of interest. I have been asked to advise in two cases which may involve market manipulation. Question No. 5, Sir.

Under our legislation, a person convicted of market rigging and related offences is liable to a fine not exceeding $50,000 or to imprisonment for a term not exceeding seven years. The penalty for a corporate body is a fine up to $100,000. In addition, the convicted person or corporate body is liable to forfeit the ill-gotten gains, compensate the parties who have suffered losses as well as to bear the cost of the investigations. These penalties, in particular the 7-year imprisonment term, are at the moment considered adequate to deter such behaviour. Government has always taken swift and effective action against securities offenders. We will continue to monitor the industry closely and to act swiftly to weed out any bad practice. If necessary, the penalties will be increased and further measures introduced to protect the interest of investors.

Is it not true that when you are talking of compensation for the victims of the crime, it depends on the victims starting an action against the manipulators, and that under the Securities Industry Act, such an action can only be commenced after a successful prosecution? Does the Minister consider that this is sufficient to protect the victims, considering that no such prosecution may be brought?

As I understand it, it is a case where the offender has been convicted, and subsequently, the person affected may then take action to recover damages. Is that the question?

May I clarify, Mr Speaker?

Yes.

Under section 105 of the Act, you can sue for civil compensation but only if there has been a conviction for market manipulation or related offences. If there is no conviction, for example, if the manipulator is charged under the Penal Code instead, the victims of the crime do not have a right to compensation under the Act. So there is a link between compensation and conviction. If the conviction does not come, the victims get no compensation. And for various reasons, there may be no conviction, if you follow what I am saying. I wonder if the Minister consider that is sufficient to protect the people.

For the moment, we have not in fact come across any case of this type. Is there a pending case he is concerned with, on the principle?

I am concerned, precisely. If indeed there is market manipulation, it again seems rather unjust that a few manipulators should be let go before we discover the loopholes. I am merely raising this for the Minister's consideration. Will he consider amending the Act?

We will look into this, although I am not familiar with the case where a conviction is not possible and yet a civil action may be possible.

This is precisely my point. If there is no conviction, there cannot be a civil case.

Right.

Therefore, a person who is cheated by market manipulation depends upon a conviction before he can claim compensation.

Indeed, I would have thought that in order to prove a claim, you would in fact need to have some support from the prosecution side. Otherwise, in the absence of any proven case that a criminal offence has taken place, how would you put together a case for civil compensation?

May I quote an example? In the Pan Electric case, for example ---

Order. Can I advise the Member that this is Question Time and he should put his points in the form of questions?

Yes, Sir.

I suggest that the Member write in to us and give us examples, and we will look into this.

Thank you.

Sir, does the Minister think it is feasible to have a small watchdog committee that will monitor the transactions daily and alert the relevant authorities if there is any possible irregularity?

Such a committee, if it really can exist, would be ideal, but I cannot imagine a committee trying to anticipate problems. There is no way. There are thousands of transactions taking place every minute, every day. How would such a committee operate? I do not think it is a practical proposal, although, theoretically, of course, if you can have it, it will be fine.

asked the Minister for Finance, in view of recent reports suggesting price manipulation and irregular practices in the conversion of preferential stocks of Neptune Orient Lines Ltd and the initial public offers of shares of Keppel Bank of Singapore Ltd and International Factors (Singapore) Ltd, whether a full inquiry will be held to prevent similar occurrences.

Mr Speaker, before I ask the question, I want to declare that I do not have any shares in any of the three companies referred to in the question. Question No. 6, Sir.

If you do not have an interest, you do not have to declare. Dr Hu.

Mr Speaker, Sir, the irregular practices in share transactions and applications which have surfaced in recent weeks are a sad reflection of the avarice of a small minority of the investing public. Their actions disrupted the proper functioning of the market, undermined market integrity and caused considerable inconvenience and uncertainty to the public at large. The irregular practices found in the application for tender shares of Keppel Bank and International Factors (Singapore) (IFS) were possible because of the simpler procedures currently in place for share applications using CPF funds. Presently, investors who use cash to apply for new shares are required to buy a bank draft or cashier's order for each application and submit it together with the share application form. Applications which are not accompanied by a bank draft or cashier's order for the correct amount are rejected. This system ensures that successful applicants pay for the shares allotted to them since they are already paid fully for the number of shares applied for. However, investors who use CPF funds to apply for new shares are presently not required to furnish evidence of their ability to pay or maintain sufficient funds in their CPF accounts. Instead, they are only required to provide their CPF account numbers in the application forms. Their CPF accounts will only be debited if their applications are successful. As evident in the recent initial public offers of Keppel Bank and IFS, this relatively simple procedure for share applications using CPF funds is not satisfactory for two reasons. First, there is no verification of the name and CPF account number furnished in the share application form to ensure that the application is genuine. Second, the procedure does not ensure that an investor using CPF funds to apply for the shares has or maintains sufficient funds in his CPF account. These weaknesses were exploited by unscrupulous investors in the Keppel Bank and IFS initial public offers. The abuses that occurred can be prevented if there are measures to verify that share applications involving use of CPF funds are genuine and that such investors have or maintain sufficient funds in their CPF accounts to pay for any shares allotted to them. The CPF Board, the SES and the agent banks are reviewing the existing procedure with these objectives in mind. In NOL's case, there is reason to believe that certain parties may have caused the fall in NOL share prices on 12th July 1993 to ensure a low conversion price for NOL preference shares. The relevant authorities are investigating into the incident and if there is evidence of criminal offence being committed, the authorities will press charges against those concerned. The NOL share incident happened partly because NOL had fixed the conversion price of its preference shares based on the last done price for its ordinary shares on a single day. It would be much more difficult for share prices to be manipulated over a sustained period. Hence, such an occurrence can be prevented if the conversion price of preference shares is based on the average of the last done price of ordinary shares over a number of days instead of a single day. The Stock Exchange is therefore studying with the relevant agencies to tighten the procedures for application for shares using CPF funds and whether further safeguards are needed for the Stock Exchange trading system and conversion of preference shares to prevent similar occurrences from happening in future. However, there is a need to balance the benefits of additional controls in the trading system against the possibility that they would stifle genuine trading activity. This is a complex issue which requires careful and thorough study. As the irregularities in transactions involving the shares of NOL, Keppel Bank and IFS are being handled by competent authorities including the Commercial Affairs Department, the Stock Exchange and the CPF Board, there is no need to conduct a full inquiry into these incidents.

Sir, may I ask the Minister whether he would consider requiring CPF investors who have accounts to buy a bank draft or cashier's order before applications are made for IPOs?

As I mentioned, this issue is being discussed by the CPF Board together with the Stock Exchange and they will come up with the procedure which does not interfere too drastically with the use of CPF funds which is against the interest of the stock buyers and yet safe enough to protect the interest of the public at large. I suggest that we wait for their conclusion.

asked the Minister for National Development if he plans to increase the supply of Housing and Development Board flats in view of the strong demand.

Mr Speaker, Sir, the HDB has been monitoring the demand and supply situation for its flats very closely. In view of the strong demand for HDB flats, the HDB has in fact been stepping up its annual building programme steadily from about 24,500 flats in 1992, to about 28,000 flats in 1993. HDB will be stepping up its annual building programme further to about 30,000 flats in 1994. The increase in the supply of flats will meet the demand. It will also not overstretch the capacity of the construction industry. Otherwise, prices will increase sharply. HDB will continue to monitor the demand for its flats and review the supply accordingly.

Sir, to many houseowners, it is not good news. The Minister of State is talking about a 15% increase over last year. But right now, I understand that the demand is outstripping the supply by 20 to 1 in some areas. For example, in Tampines, for 5-room flats, there are 8,000 applicants for 300-over flats.

As I have explained in this House earlier, the profile of demand for HDB flats has changed drastically over the years. Between 50% and 60% of the applicants for HDB flats are upgraders, ie, they own their existing flats and they are looking for a bigger flat. These applicants are very location-specific. The Member mentioned Tampines. For example, in the July booking for HDB flats, there were 29,000 applicants for Tampines New Town, but we are only building 2,200 units in Tampines. There is no way we can build 29,000 units in Tampines. If you visit Tampines today, it is a built-up town and the remaining area is like a big construction site. So we will increase the supply of HDB flats in areas where the Government has enough land, in Choa Chu Kang, Jurong West, Woodlands, and we will open up new towns in Sembawang. But where there is a demand for 29,000 flats in Tampines, there is simply no way we can build 29,000 flats.

The point, Mr Speaker, is that there is just not sufficient supply. The question I am asking now is this. At this date, what is the latest demand position against the current supply of 20,000 flats?

The situation in the other towns is within the planning parameters of HDB. In Choa Chu Kang, Woodlands and Jurong West, the profile is about five applicants to one flat. And new households applying for HDB flats will be able to book their flats within one year of their first application. The other increases in demand are very location-specific, ie, in the mature towns, in the central areas, as well as in Tampines. As I have explained earlier, there is no way we can increase the construction rate to meet the demand. There is just no land in these areas.

Sir, I am particularly concerned about the first-timers, the young couples who are getting married. Will they be treated separately from those who are upgrading from their existing flats? And also those who are in the rental flats and who want to purchase their own flats for the first time, will priority be considered for such category of people?

Sir, the priority scheme for first-timers as well as people upgrading from rental flats, in effect, gives them a one year head-start compared to the upgraders. If they apply for places where the Government has a big construction programme, like in Jurong West, Woodlands and Sembawang, they would get their flats within one year of first application.

Sir, taking the Minister of State's point about the demand of 5:1 in less mature areas and 15:1 in Tampines, can we say that the demand now is about 10:1, which means that applicants may have to wait 10 years before they can get their flats?

The demand is very location-specific. In Queenstown, it is 22:1. The whole place is built up. The demand is there. As I have explained in this House, there are three ways in which we can allocate demand when there is limited supply. You can ballot, which we are doing now. You can queue, or you can tender. So take your pick.

The question I am asking the Minister of State is that the numbers indicate that the overall demand is at least 10 times the supply. Am I wrong? Because you have a case of 22:1 in Queenstown, 15:1 in Tampines, and 5:1 in the less mature estates. So are we not talking about a demand of at least 10:1?

Sir, the Member does not seem to understand the situation. As I have explained, 50-60% of applicants are upgraders. They have their flats. They are quite happy staying where they are, but they put in an application to upgrade, provided they get where they want. So every time we have an estate put up in the mature new towns, the number of applications surges by 20,000 in that quarter. Similarly, for Tampines. There are 29,000 applicants, and I am sure many of these applicants only want Tampines and nowhere else. So they get balloted and, if they are lucky, they get Tampines. We are not going to build 29,000 flats in Woodlands and have them empty because the 29,000 applicants in Tampines would not take up flats in Woodlands. This happened in 1984. We are not going to repeat this.

Sir, I really do not understand the Minister of State. Maybe I am a bit dense. If this number of applicants in Tampines is shifted to another area, the total demand remains. It is the same. In other words, the total demand far exceeds supply. That is my point.

Sir, when we have to close down Tampines, as we did in Pasir Ris, and if these 29,000 do shift to Choa Chu Kang, we will increase the supply in Choa Chu Kang, Jurong West and Woodlands accordingly. Today, we have catered enough for the upgraders. But we are not convinced that all the 29,000 who apply for Tampines would switch to Choa Chu Kang, Jurong West or Woodlands when we close down Tampines.

Sir, I beg your indulgence. What is the latest total demand position versus the supply position in the last ballot?

We have booking exercises in four quarters, ie, four times a year. When we do not put up any flats in the mature estate, we get an average demand of 30,000, which we are building to meet this demand. So, on average, if you wait one year you will get your flats. Whenever we put up flats for booking in the mature estates, in Queenstown itself, the demand jacks up to 50,000. 20,000 new applicants come in to try their luck for these mature estates. That does not mean that we should increase our building programme to 50,000. We will increase our building programme to meet genuine demand.

asked the Minister for National Development whether he will review the flat allocation policy for applicants living in mature Housing and Development Board estates.

asked the Minister for National Development whether he will explain how the Residents' Priority Scheme works in the selection and balloting of new Housing and Development Board flats in the Queenstown area, particularly for residents who have been staying there for decades.

asked the Minister for National Development if he will state how many residents in the Queenstown area were considered under the Residents' Priority Scheme in the last selection of Housing and Development Board flats in Queenstown and how many of them were successful under the scheme, and how does this compare with the success rate for non-residents applying for flats in Queenstown.

Sir, can I have your permission to take Questions Nos. 24 and 25 by Mr Chay Wai Chuen together with Question No. 8, because they are on the same subject?

All right.

Mr Chay asked how the Residents' Priority Scheme works and, in particular, how that works in the latest exercise for Queenstown. Dr Vasoo asks whether we should review this system. So I will take these three Questions together. Under the Residents' Priority Scheme, applicants for new flats in mature estates who have been residing for at least five years in the estate they apply for, enjoy twice the probability of success as non-resident applicants in the ballot for flats. All applications received for a particular flat-type in a particular mature estate, for example, 4-room flats in Queenstown, are classified into resident and non-resident application. The number of 4-room flats available for booking in Queenstown is then divided between the two categories of applicants to ensure that resident applicants enjoy twice the probability of success at the ballot as compared to non-resident applicants. Successful applicants are then invited to select their flats according to their balloted queue numbers. This process is repeated for every flat-type in every mature estate. In the booking exercise for flats in Queenstown conducted in April 1993, a total of 6,096 applications were received for 338 flats. In other words, 18 applications for every flat available. The 6,096 applications comprised 1,889 applications from residents and 4,207 from non-residents. A total of 161 resident applicants or 8.5% of total resident applicants, and 177 non-resident applicants or 4.2% of total non-resident applicants were successful in their ballot for flats in Queenstown. In other words, resident applicants enjoyed twice the success rate compared to non-resident applicants in the ballot for flats in Queenstown. Dr Vasoo asks whether we are reviewing the allocation system. The Residents' Priority Scheme is fair as it gives both resident and non-resident applicants a chance of being allocated a flat in a mature estate. Many residents, however, are disappointed that they are unable to obtain a flat in the same estate that they are staying. This is simply because of the limited number of flats available in the mature estates. At present, as I said, residents enjoy twice the probability of success compared to non-residents. If we give residents higher priority, this will mean that non-residents will have less chance. Even if we allocate all the 338 flats in Queenstown in the second Quarter 1993 booking exercise to residents, it will still not meet the requests of the 1,889 resident applicants. The problem is simply one of overwhelming demand compared to a limited supply. If Members have any good suggestion on how we can improve the allocation system in a fair and equitable way, I will be very happy to look at their suggestions.

Sir, is it not urgent, in the light of the re-building programme in the city area, to consider higher priority for residents living in the area so that the network and support system can be maintained, and people will feel less dislocated?

We appreciate the need for residents to want to remain in the estate that they are staying in. That is why we give them twice the priority. But at the same time, we have to be fair to non-residents. More importantly, the reason why there is an overwhelming demand is that the flats in the mature estates are very good value for money. So if you exclude non-residents, I think you will not be very fair. So we have struck a balance today by giving twice the priority for residents and I think this is fair to both residents and non-residents.

Sir, would the Minister consider giving some priority to upgraders who are young couples with children and want to be in estates where their parents or parents-in-law are living?

There are many categories of applicants who desire priority. There is a category who says, "I am upgrading because I have been living in a 3-room flat. Now I want a 5-room flat. Give me priority." There is another category who says, "Give my children priority because they want to live near to their parents." If we create more and more sub-schemes to give priority, there is only this piece of cake and however you divide it, some will enjoy more priority and others will have to lose out. The only way is really to increase the price.

Would the Minister consider that since family values are in our national ethos, that should merit more priority than mere upgrading for bigger space?

We treasure family ties and we encourage such groups who want to keep their families together to apply for Woodlands where they can get two flats very close to one another and they can get them very, very early.

asked the Minister for National Development when plans for building 4-room budget Housing and Development Board flats will be implemented and whether the prices of these flats will be reasonable to enable more people to upgrade themselves.

Sir, the first batch of 227 units of smaller 4-room flats will be offered for booking in October 1993. These 227 units will be located in Choa Chu Kang and Woodlands new towns. These 4-room flats will have a slightly smaller floor area of 90 square metres as compared to 100 square metres, and simpler finishes than the standard 4-room flats. The first batch of these 4-room flats will be priced around $70,000 to $93,000, which is about 18% cheaper than the standard 4-room flats. At such prices, households with monthly incomes of between $850 and $1,000 should be able to meet the monthly mortgage instalments for these 4-room flats entirely from their CPF contributions. These 4-room flats are therefore well within the affordability of lower income households.

Sir, while the question deals with upgrading, and I believe that the system does a lot for people who wish to upgrade it, the system does nothing for people who wish to downgrade. Sir, may I ask the Minister of State why does HDB make it difficult, for example, for families whose grown-up children have moved out, to sell off their flat because they want to downgrade to a smaller unit? This is also true for people who want to be financially secure because they foresee financial difficulties ahead. They would rather have some cash in their pockets than live in a flat which is too big for them. These people also wish to downgrade. After selling off their properties in the open market, they now find it difficult to buy smaller flats from the HDB. At the same time, Sir ---

Mr Heng, could you ask your question?

Yes. I am asking the question. Sir, why does the HDB system make it difficult for this type of people? In the meanwhile, while they are waiting for a smaller flat allocation and if they want to rent a flat, they could not do so. There is a policy, since 1st June 1993, that debars them for 30 months from renting a HDB flat. So after selling off their flats, these people find it difficult to rent a HDB flat while waiting for a smaller flat.

The public housing scheme is tailored to enable every Singaporean to own his flat. That is why it is a heavily subsidized programme. They buy their flats at heavily subsidized prices. Those who sell away their flats have already enjoyed a subsidy from the Government. To come back to the rental flats to enjoy a second subsidy, that is not what we want to encourage. But if any family has to downgrade because of financial problems, I can assure Members that such families would be allowed to rent flats at subsidized rates. So it is not true that the system penalises those who want to downgrade. In fact, we encourage people who have smaller families, after their children have grown up, to sell off their 5-room flat and buy a 3-room flat in the resale market. Keep the capital gains and live happily ever after.

Sir, does this mean that the HDB does not have smaller flats for people who want to rent at market rates, and not at subsidized rates?

The HDB is not in the business of renting flats at market rate. We provide houses for sale because we aim for a home-owning society. For those who are not able to afford it, we provide rental flats at subsidized rates so that they have a home of their own. For those who want to sell off their flats, they can easily buy a smaller flat. They have made quite a big capital sum and they can buy a smaller resale flat and still have a substantial capital gain for their old age.

Sir, may I repeat my question? Does HDB have smaller flats for rental at market rates?

HDB provides smaller flats for rental at market rates to two categories of applicants. One is for those who are applying for a flat for the first time and who need a flat for the time being. This is called the Transitional Rental Housing Scheme. It is tailored for a young couple who is buying a home for the first time and while waiting for the home, HDB rents the flat to them. Because their income is above $800 per month, they do not enjoy subsidized rental. So they pay market rental. The second category are permanent residents (PRs) or employment pass holders who come to Singapore to work and during the transition, when they are starting work, we also rent them a flat at market rate to tide them over this period. When they become PRs and they are allowed to buy flats in the resale market, they enter the resale market.

But then my question is very simple: why are these persons, who are Singapore citizens and wish to downgrade, not allowed to rent these flats at market rates? I do not think the element of subsidy is here because they are at market rates. After all, we are renting them to permanent residents who are not Singaporeans.

These Singaporeans who have already bought the flat have enjoyed a subsidy from Government and have made substantial capital gains. If they want, they can easily buy a flat in the open market. They can also apply for a new flat from the HDB, if this is their second time they are applying. There is no rule to prevent them from applying a second time. But we do not intend to build flats for rental because it is a decreasing segment and we want to encourage a home-owning society.

Mr Speaker, Sir, coming back to my question, would the HDB be prepared to build more budget flats in anticipation of more 3-room families upgrading themselves?

HDB now builds based on demand. We will try out with these 227 units in October 1993. If there is overwhelming demand, showing that there is a sector of people who want these smaller flats, which is 18% cheaper, HDB will adjust its building programme accordingly to meet this demand.

asked the Minister for National Development if the Housing and Development Board will review its policy of building executive flats and maisonettes in view of the popularity of private developments of similar apartments.

The current high demand for private residential properties has in fact widened the price gap between HDB Executive flats and private apartments. For example, the price for an Executive flat in Tampines New Town is about $1,500 per square metre, which is less than half of the price of about $3,500 per square metre for a private apartment in the Tanamera condominium development nearby. Some Singaporeans may thus find themselves in a position where they wish to and can afford to upgrade to something better than a 4- or 5-room flat but find private apartments beyond their reach. HDB Executive flats, which are priced at a very affordable level, serve to meet the aspirations of this group of Singaporeans. Despite the popularity of similar private apartments, the ratio of supply to demand for Executive flats under the Booking System has remained at about 1:5 for the last three quarters. This sustained high demand for Executive flats shows that there is a segment of Singaporeans who still prefer, or can only afford, HDB Executive flats. HDB will thus continue to build to meet this demand, so as to provide Singaporeans with more choices in housing.

Mr Speaker, Sir, seeing the gap between the prices of private housing and HDB Executive flats, does it not lead to a situation whereby there will be more applicants in future looking for Executive flats as a result of the higher subsidy?

We build according to demand. And if there is indeed a growing segment, we will have to adjust the building programme accordingly. But at the same time, we are releasing more and more land for private apartments. So the prices for private apartments ought to come down when the new supply comes into the market.

asked the Minister for Home Affairs whether the Government will review the policy on citizenship and permanent residence for foreign spouses as the increasing number of Singaporean males going abroad as expatriates will aggravate the marital problems of Singaporean females, with both ending up marrying foreigners.

Mr Speaker, Sir, we have liberalised our immigration policies in recent years. For example, while five years ago, slightly more than half of the PR applications from spouses of Singaporean citizens were approved, the position now is that the vast majority (75%) of applications from foreign spouses are approved. As for citizenship, we are also liberal. More than 90% of the citizenship applications by foreign spouses are approved. The Government will constantly keep under review its immigration policies and make adjustments, whenever necessary, for our national interests.

Sir, would the Minister consider granting Singapore citizenship to children of Singaporean mothers and foreign fathers but born outside Singapore, as this would help the Singaporean woman to return home with the children if she becomes a widow or a divorcee?

Mr Speaker, Sir, my Ministry and the Citizenship Registry are very liberal in these cases because there are ample provisions in the Constitution for the Registry of Citizenship to grant citizenship in such cases.

Sir, would the Minister consider spelling out the criteria for eligibility for PR and citizenship, instead of on a case-by-case basis?

Sir, the broad policies are quite well known and have been articulated. If there is any particular area that the Member feels is not sufficiently clear, she can either take it up in a subsequent Question for Oral Answer or raise it with my Ministry and we will look into it.

Sir, may I ask the Minister: how many of these successful applicants with foreign spouses were males and how many were females?

I do not have the details but I do recall that in both cases the percentage now is very high. It is either in the high 60s percentage or in the 70s percentage.

asked the Minister for Finance whether he will allow men to claim for (i) enhanced child relief and (ii) foreign maid levy relief which are currently only given to women.

Mr Speaker, Sir, the enhanced child relief and foreign maid levy relief are targetted at women for specific objectives and will remain so. The enhanced child relief is separate from the normal child relief which either husband or wife or both can claim. It was introduced as an incentive for women who have obtained three GCE '0' levels or equivalent to remain in the workforce. In our labour-short economy, we cannot afford the loss of highly trained women from the workforce. This clearly does not apply to men in general and therefore the relief will not be extended to them. Similarly, the foreign maid levy relief is intended to encourage married women to participate in the workforce and have children at the same time. It is not meant to help all employers of foreign maids.

I wonder whether the Minister is willing to consider one category of men who are divorced and who have custody of their children and they have to go out to get employment and, at the same time, they have to employ maids to take care of their children. If the policy is inflexible, this group of people will suffer.

Mr Speaker, Sir, as I have explained, the foreign maid levy is intended to encourage married women to participate in the workforce. In the case that the Member has mentioned, there is no necessity for further encouragement to participate in the workforce. So I think the incentive is not necessary.

Sir, I am just wondering whether the Minister would be flexible enough to take care of this group of people. Because sometimes it is not out of choice, the children are forced on him as their mother gets married to another person and they go abroad and abandon the children.

Mr Speaker, Sir, while one is sympathetic to the plight of persons who are in that situation, the objective of the foreign maid levy relief should be seen clearly in perspective, and that is, to encourage married women to participate in the workforce. As I said, there is no necessity for further encouragement for such persons, as the Member has described, to participate in the workforce.

Sir, I just want to ask for another category. Would the Minister consider a category where the wife is the breadwinner? In this case, I think you want to encourage the man, rather than the wife, to go to work.

Mr Speaker, Sir, in such a case, the purpose of the foreign maid levy relief has been achieved. Basically, if the wife is the main wage earner, she may well have been encouraged to keep on working because of the foreign maid levy relief. In that case, the scheme has achieved its objective and I do not think it is necessary to extend it.

asked the Minister for Trade and Industry (a) what is the current status of development projects in the Riau Islands of Bintan and Karimun; (b) whether our partners in the Growth Triangle have expressed any views or concern about the shift of interest by the Government and private sector to new investment areas; and (c) whether new measures and incentives have been proposed by them to rekindle and sustain investment interest in the Growth Triangle.

Mr Speaker, Sir, Phase 1A of the Batam Industrial Park covering 23 factory buildings and 70 hectares of land have been completed and all factory space is fully utilised. When Phases 1B and 2A are completed by August 1993 and December 1994 respectively, there will be another 66 factory buildings. There are currently 37 manufacturing companies in operation at the Batam Industrial Park, employing 16,000 workers. This figure is expected to rise to 20,000 by the end of the year. Over the past year, we have also witnessed smooth progress in projects in Bintan and Karimun. Ground breaking ceremonies were held for two Bintan tourist resort projects. There were also similar ceremonies for the Bintan Industrial Estate and the Karimun Industrial Complex. The Government's interest and commitment in the Growth Triangle has not shifted. We believe that the Growth Triangle will continue to offer attractive opportunities for our businessmen, especially when they are more familiar with operating conditions in Indonesia and Malaysia. Geographically, Johor and the Riau Province are also much closer to Singapore. Ultimately, private sector businessmen will invest in locations which they find most profitable. They will continue to invest in the Growth Triangle as long as the conditions remain comparatively attractive. Singapore and its partners must therefore recognise the challenge posed by the new opportunities elsewhere - in China, Vietnam, and India - and do their best to compete for the investment dollar. A conducive business environment with predictable regulations must also prevail to give investors more certainty in planning their investments. During my visit to Indonesia last month, I had the opportunity to talk to a few of my counterparts in the Indonesian Cabinet. They too are conscious of the challenge posed by the new investment locations, and the need to ensure that Indonesia continues to be attractive. We are certainly moving in the right direction. We are optimistic that the Growth Triangle will continue to attract its fair share of investments within an increasingly competitive marketplace.

asked the Minister for Health what measures are being taken to reduce the waiting time of patients seeking treatment at Government restructured hospitals.

Sir, the waiting time at the Specialist Outpatient Clinics (SOC) in Government and restructured hospitals has improved from a median of 32 minutes in 1990 to 28 minutes in 1992. The proportion of patients who waited less than 60 minutes has improved from 78% in 1990 to 84% in 1992. These improvements in waiting time were achieved despite a 22% increase in the total number of SOC attendances, from 1.35 million in 1990 to 1.65 million in 1992. All the hospitals have upgraded their appointment scheduling systems by computerising them. However, they still face problems with about 20% to 30% of patients who fail to keep their appointments. The hospitals have been regularly advising patients to inform the hospital if they cannot keep their appointments. To overcome the high defaulter rate, a certain amount of overbooking of appointments is done. As it is not possible to predict the exact number of defaulters for a particular session, sometimes patients will have to wait longer if the number of patients turning up is more than anticipated. The hospitals are monitoring the situation closely and are fine-tuning the appointment system. The hospitals also face the problem of patients turning up at the SOC without appointments. Patients who do so, but who cannot be turned away for medical reasons, are attended to at the end of the clinical session. They therefore wait longer. Another factor that contributes to longer waiting times is that certain specialists like cardiologists and obstetricians, by the nature of their work, are more likely to be called away to attend to emergencies. The hospitals normally arrange for alternative doctors when this happens. However, the hospitals find that the patients often --- 1.30 pm

Order. It is 1.30 pm. End of Question time. [Pursuant to Standing Order No. 21(3), Questions Nos. 16-21, 23, 26-28 and 30 have been postponed to the next available sitting of Parliament. Written answers to Questions Nos. 14, 15, 22 and 29 on the Order Paper are reproduced in the section, 'Oral Answers to Questions Not Reached' (Cols. 377 - 382).]

"to amend the Arms Offences Act (Chapter 14 of the 1985 Revised Edition)", presented by the Minister for Home Affairs (Prof. S. Jayakumar); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

"to amend the Banking Act (Chapter 19 of the 1985 Revised Edition)", presented by the Minister of State for Finance (Cdre Teo Chee Hean); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

"to amend the Income Tax Act (Chapter 134 of the 1992 Revised Edition)", recommendation of President signified; presented by Cdre Teo Chee Hean; read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

"to amend the Central Provident Fund Act (Chapter 36 of the 1991 Revised Edition)", presented by the Minister for Labour (Dr Lee Boon Yang); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

Order for Second Reading read.

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." Before I describe the contents of the Bill, Sir, let me brief Members on the background to this Bill. The Travel Agents Act (Chapter 334) came into effect on 1st December 1976. It empowers the Singapore Tourist Promotion Board (STPB) to license and regulate all travel agent activities. The Compensation Fund was also established under the Act which I will discuss in a moment. In the last 17 years, the licensing requirement has helped weed out the shakier travel agents in the industry. The number of default cases has also reduced significantly. The Compensation Fund, which I mentioned earlier, was established under the Act and is funded by a one-off contribution of $1,500 each by all licensed travel agents. The Fund is administered by a Compensation Fund Committee under the STPB and is used to compensate travellers in the event of fraud or loss. The Fund, as it currently stands, is not sustainable as the contributions to the Fund are not determined on an actuarial basis, and bear no relationship to the associated risk exposure. It is merely $1,500 from each licensee. So an occasional large claim could wipe out the whole Fund. For the Fund to act as an insurance scheme, contributions would have to be much higher than the existing one-off payment of $1,500 per licensed travel agent. This is not desirable, as it would amount to a levy on the travel industry to provide protection for the travelling public. Besides, it is not the Government's role to provide insurance to buyers of goods and services against defaults by the sellers. Government does not take on such a role for other consumer or business groups, and should not do so for tourists. A better safeguard is to have sufficient conditions in the licensing requirements to minimise defaults. This is what STPB has done. Travel agents, for example, are now required to have a minimum capital investment and to provide STPB with additional financial security in the event of poor financial performance. Such additional security will be, for example, a bank guarantee. They are also required to submit audited accounts on an annual basis to STPB, which has the power to revoke an agent's licence on grounds of financial insolvency and/or professional misconduct. These requirements, as I mentioned earlier, have weeded out the shakier travel agents in the industry. With these safeguards, it has thus been decided that the Compensation Fund be dissolved. Under the existing Act, STPB can revoke the licences of travel agents for breach of the Act or Regulations, but there is no power to suspend the licences or compound minor offences. Revocation is a severe penalty for minor offences. The result is that minor offences are not effectively dealt with. In practice, therefore, revocation is rarely carried out, and such revocation prosecutions also involve long drawn-out court proceedings. Revocation will also inconvenience existing customers as the affected travel agent must cease business. Power to suspend licences and compound minor offences will ensure better enforcement of the Act and Regulations without inconveniencing consumers. Suspension of a licence only prevents solicitation of new business during the suspension period, but allows current business to continue. To enhance STPB's ability to effectively implement the Travel Agents Act, STPB should be empowered to suspend licences of travel agents and to compound offences committed by travel agents for minor breaches of the Act or Regulations, and this is what this Bill now provides. I will now elaborate on the provisions of the Bill. Clause 5 of the Bill provides for the dissolution of the Compensation Fund. Clause 8(1) and (2) provides for the transfer of the balance of the Fund to a special account under the Singapore Tourist Promotion Board. This balance, which now stands approximately at $1.3 million, will be used for consumer education, marketing and promoting activities to assist travel agents, and projects to raise service standards among the local travel agents. Transitional provisions are provided under clause 8(3) and (4) to enable STPB to hear and decide on claims arising prior to the operational date of this Bill. Clauses 3 and 4 provide for the power to suspend licences, while the power to compound offences is in clause 6. Grounds for suspension will be gazetted in the Travel Agents Regulations after the Bill has been enacted. Revenue collected from the compounding of offences will go into the Tourist Promotion Fund established under the Tourist Promotion Board Act. Mr Speaker, Sir, the proposed amendments will dissolve the Compensation Fund and enhance STPB's capabilities to implement the Travel Agents Act effectively by empowering it to compound offences and suspend licences for minor offences. Sir, I beg to move.

Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. - [Mr S. Dhanabalan]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Order for Second Reading read.

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Bill proposes to amend the Electrical Workers and Contractors Licensing Act (Chapter 89) by introducing provisions to safeguard the interest of members of the public when they require assistance in attending to electrical faults in their homes. The Bill will also enable the Public Utilities Board (PUB) to enforce the Act more effectively. PUB has received complaints from the public of unsatisfactory electrical services performed by unlicensed tradesmen. Under the present Act, PUB can take action against unlicensed electrical workers and contractors who advertise or hold themselves out as persons qualified to do "electrical work" as defined in the Act. However, where the services advertised do not fall specifically within the meaning of "electrical work" under the Act, PUB has no power to take any action. "Electrical work" is presently defined as only work carried out on an electrical installation. The present definition does not cover services, such as the design and planning of electrical system in a household, office or factory. Nor does it include checking of the electrical system and general servicing where no actual "work" is "carried out". This situation is not desirable as it has given rise to unscrupulous, unlicensed contractors advertising their services in a misleading way. Very often, these contractors make misleading or unsubstantiated statements about the qualifications and experience in their advertisements. This should be stopped. A new section 6A is being added to the Electrical Workers and Contractors Licensing Act. This new section provides for a broader definition of electrical services to include all aspects of work connected with the wiring of electrical installations or the rectification of electrical power failure. It will require any person who advertises by any means the supply of such electrical services to state expressly in his advertisement whether or not he is a licensed electrical worker or a licensed electrical contractor and, if so, the number and date of expiry of his licence and the address of the place at which he carries on his business. This will ensure that only properly qualified and licensed electrical contractors and workers attend to electrical faults. The new sections 11A and 11B will help PUB enforce the Act more expeditiously and effectively. The new section 11A empowers PUB's authorised officer to require any person to furnish to PUB any knowledge of information or evidence which PUB may require for any purpose under the Act. This will assist PUB in their investigations into complaints of unsatisfactory electrical services or other offences under the Act. The new section 11B will facilitate the service of notices, orders, documents and summonses on offenders. The new section 11C provides for a general penalty for offences under this Act or its Regulations where no penalty has been expressly provided. Section 14 is amended to raise the maximum amount payable for composition of offences from $200 to $500. The existing maximum penalty of $200 is too low to be an effective deterrent in the present circumstances. All these amendments are to come into operation immediately. Sir, I beg to move.

Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. - [Mr S. Dhanabalan]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Order for Second Reading read.

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Customs (Amendment) Bill 1993 seeks to amend the Customs Act to provide for excise duties on imports, prevent smuggling, improve administration of the Act and to regularise current Customs practices. Levying Excise Duties on Imports The outcome of the Uruguay Round of GATT negotiations may require us to lower our ad valorem import duties. In particular, import duties on motor vehicles would be affected. In order to comply with the possible GATT requirement, without at the same time undermining our objective of containing car growth, we would have to provide for the levying of excise duties on imports. Excise duties at present can only be levied on locally-manufactured goods. Traders and importers will not be affected as excise duties will be levied such that the total quantum of tax payable at the end of the day will be the same. Hong Kong, Thailand and many of the EC countries also impose excise duties on imports. Clauses 2 and 5 amend sections 3 and 10 of the Act to effect this. Preventing Smuggling At present, the Act allows agents to make changes to their cargo manifests for any reasonable shortfall or excess in the cargo, as well as for "any other cause". This presents a loophole for smugglers to amend the description of the goods once an offence is detected. I have therefore replaced the "any other cause" provision with "such other cause as the Minister may by order specify". The Act would also be amended to require cargo manifests for goods brought into Singapore, and not just for goods destined for Singapore, as is now the case. This is to prevent the smuggling of goods on the pretext that they are not destined for Singapore. Clauses 9 and 10 amend sections 39 and 40 of the Act to effect these changes. In view of the higher duty rates for cigarettes and liquor, a higher penalty is necessary to deter smuggling. The maximum fine for compoundable offences would be raised from $2,000 to $5,000. The maximum fine for refusing to answer or giving false information would also be raised from $1,000 to $5,000; and the maximum prison sentence from 6 to 12 months. This will bring it in line with the penalty for making incorrect declarations and falsifying documents, which currently carries a maximum fine of $10,000 and a maximum prison term of 12 months. Clauses 24 and 26 amend sections 126 and 129 to effect these changes. Improving Administration of the Act Recent developments in the shipping industry have given rise to third party agents, who coordinate the shipping of cargo on behalf of shipping agents. The Act, however, does not allow such third party agents to submit cargo manifests. Those who do so on behalf of shipping agents are therefore not accountable for their submissions. I have thus amended the Act to allow shipping or aircraft agents to authorise another person to submit cargo manifests on their behalf; and for such authorised persons to be accountable for their submissions. Clause 9 amends section 39 to provide for this change. The detention period of arrests without a warrant would be extended from 24 to 48 hours, to be in line with provisions in the Criminal Procedure Code. It will give Customs officers enough time to ensure that investigations are more thorough. Clause 22 amends section 112 to effect this change. Currently, it is an offence for tourists to sell, exchange or give away any duty free entitlements purchased in Singapore. This should also apply to returning residents, as well as to purchases from overseas. The Act will thus be amended to extend the provision to all travellers and their duty free entitlements, including those purchased overseas. Clause 27 amends section 130 to effect this change. The three-quarter tank rule at present only applies to Singapore cars leaving through the Causeway at Woodlands. The rule will be extended to cover such cars leaving Singapore through all exit points. Clause 28 amends section 136A to effect this change. Regularising Current Practices I am also amending sections 34, 37 and 42 of the Act via clauses 7, 8 and 12 to formalise the following Customs practices that are not currently provided for in the Act: (a) dispensing with the need for permits for goods which are transhipped within the same Free Trade Zone; (b) requiring permits for goods removed from the Free Trade Zone; and (c) making the pilot, owner or agent of an aircraft similarly liable as the captain, owner or agent of a ship, in respect of payment of duty on unaccounted goods. Other Minor Amendments The remaining seven amendments, which are minor, are to provide for the following: (a) Customs officers to be allowed to make copies of documents in the course of conducting any search on premises; [Clause 19] (b) notices to a body of persons or company to be deemed served when they are delivered to the secretary or any officer of the body of persons or company; [Clause 17] (c) the Director-General to be allowed to waive the recovery of revenue which is less than $20, in each case; [Clause 6] (d) licensed liquor establishments to accept payments for purchases through credit cards, charge cards, gift vouchers and other modes approved by the Director-General; [Clause 15] (e) the appointment of new grades of Customs officers; [Clauses 3 and 4] (f) the Minister to prescribe regulations for the ranks, uniforms, accoutrements and equipment of Customs officers; [Clause 32] and finally, (g) the adoption of the International Organisation of Legal Metrology (OIML) standard for measuring alcoholic strength. [Clause 2] Sir, I beg to move. Question proposed.

Sir, may I get a clarification from the Minister? I believe I heard him mention that import duties on cars would be lowered because of some GATT arrangements. Can the Minister please elaborate on that point?

Under the GATT rules, countries which accede to the GATT arrangements are required over time to lower import tariffs to an undetermined figure. Our import duties on cars are quite high now. If we accede to GATT, assuming the GATT requirement is approved in the near future, we would be faced by this requirement to lower import duties. In order not to allow this requirement to reduce the price of cars, we will replace the decrease in import duties with an exact equivalent in excise tax. So the cost of the car to the buyer will remain exactly the same.

That is something which I do not understand. Because, in effect, you are not complying with GATT requirements. In effect, you are just juggling with your taxes.

GATT does not impose requirements on the internal taxes of a country. That is the privilege or the sovereignty of the country. You can impose any taxes you like on your own people but not on imported goods. I accept that the effect is the same but, nevertheless, that is the law.

Question put, and agreed to. Bill accordingly read a Second time and committed to a Committee of the whole House. The House immediately resolved itself into a Committee on the Bill. - [Dr Richard Hu Tsu Tau]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Resolved, "That Parliament do now adjourn to a date to be fixed." - [Mr Wong Kan Seng]. Adjourned accordingly at Five Minutes to Two o'clock pm to a date to be fixed. Chart 1 - REAL WAGE GROWTH AND PRODUCTIVITY GROWTH (Cols. 373 - 374) Table 1 - TRAINING INVESTMENT AS PROPORTION OF PAYROLL, 1992 (Cols. 375 - 376)

asked the Minister for Health what measures are being taken to reduce the waiting time of patients seeking treatment at Government restructured hospitals.

The waiting time at the Specialist Outpatient Clinics (SOC) in government and restructured hospitals has improved from a median of 32 minutes in 1990 to 28 minutes in 1992. The proportion of patients who waited less than 60 minutes has improved from 78% in 1990 to 84% in 1992. These improvements in waiting time were achieved despite a 22% increase in the total number of SOC attendances, from 1.35 million in 1990 to 1.65 million in 1992. All the hospitals have upgraded their appointment scheduling systems by computerising them. However, they still face problems with about 20% to 30% of patients who fail to keep their appointments. The hospitals have been regularly advising patients to inform the hospital if they cannot keep their appointments. To overcome the high defaulter rate, a certain amount of overbooking of appointments is done. As it is not possible to predict the exact number of defaulters for a particular session, sometimes patients will have to wait longer if the number of patients turning up is more than anticipated. The hospitals are monitoring the situation closely and fine-tuning the appointment system. The hospitals also face the problem of patients turning up at the SOC without appointments. Patients who do so, but who cannot be turned away for medical reasons, are attended to at the end of the clinic session. They therefore experience longer waiting times. Another factor that contributes to longer waiting times is that certain specialists like Cardiologists and Obstetricians, by the nature of their work, are more likely to be called away to attend to emergencies. The hospitals normally arrange for alternative doctors when this happens. However, the hospitals find that patients often prefer to wait for their own personal doctor. The hospitals also ensure that doctors are punctual and that they do not schedule ward rounds, meetings, operating and teaching sessions when they have their clinic sessions. Other measures which have been implemented to reduce waiting times include: a) Improving the operations of the Medical Records Office to ensure that the case records of patients with appointments are retrieved at least 2 days in advance of their appointment. As a result, the percentage of patients without case records have reduced from 0.05% in 1990 to 0.01% in 1992. b) In the A&E Department, more doctors are rostered during the busy periods identified. In addition, a system has also been set up whereby doctors in the wards and other departments are alerted and deployed to the A&E Department whenever a crowd builds up. The Ministry will continue to monitor and to look into measures to improve waiting times as much as possible.

asked the Minister for Health if he will consider some form of health monitoring for the proliferating slimming businesses.

Slimming businesses are not under the purview of my Ministry, as they do not provide health care services. However, when complaints are received from the public or medical doctors about the unlawful use of scheduled drugs and harmful medical products which are regulated under the Medicines Act and Poisons Act, in slimming saloons, the Ministry will look into them. Between January 1992 and June 1993, the Ministry has received and investigated three complaints about slimming businesses. We have not found any evidence of the use of scheduled drugs or harmful medical products. There is therefore no need for the Ministry to have regular health monitoring of slimming businesses.

asked the Minister for National Development what were the reasons for the subletting policy of the Housing and Development Board when it was first implemented and whether a review is appropriate in the circumstances today.

The public housing programme and its associated policies are designed to provide affordable housing to Singaporeans. HDB flats are, therefore, intended for owner-occupation and not as an investment to generate rental income. It is for this reason that HDB lessees are not normally allowed to sublet their entire flats. Subletting of whole flats is permitted by HDB only under special circumstances such as when lessees have to study or work overseas for extended periods. HDB's approval is required for subletting of entire flats. The policy to allow subletting of rooms in HDB flats was implemented in 1973. The objective was to allow HDB lessees with small families to sublet spare rooms in their flats. This is to encourage more productive use of space. However, lessees must continue to live in their flats. Besides fulfilling the owner-occupation condition, this requirement also has the advantage of ensuring that tenants abide by the subletting conditions and do not become a nuisance to their neighbours. The policy on owner-occupation is still necessary for the reasons stated. The subletting conditions are designed to support this policy.

asked the Minister for Health if he will consider the use of Medisave for hospice care.

My Ministry is currently studying the possibility of extending the use of Medisave for hospice care. We expect to complete the review within the next few months.

asked the Minister for National Development if he will state i) the average yearly increase in public housing land prices which the Housing and Development Board paid to the Government from 1988 to 1992; ii) the effects of these increases on the subsequent selling prices of HDB flats for those years; and iii) the possibility of increasing the plot ratio or density of land usage to control and possibly reduce the selling prices of HDB flats.

HDB purchases its land from the Land Office at market rates assessed by the Chief Valuer. Factors such as location and intensity of the development are taken into account in determining the market land rate. From 1985 to 1992, land cost for HDB flats rose at an average of 4% per year. In the last 5 years, however, from 1988 to 1992, land cost rose at an average of 11% per year. HDB currently buys land for public housing at about $1,000 psm for a Gross Plot Ratio (GPR) of about 2.8 to 3. By comparison, successful tenders for residential land in HDB estates under the Sale of Sites Programme are typically in the region of about $2,000 psm for a lower GPR of 2. Public housing land prices have therefore risen much slower than tender prices for sale of sites. Pricing of HDB flats is primarily cost driven. The two major components of total development cost for HDB flats are land and construction costs. Land cost rose by about 55% and construction cost by about 97% over the period 1988 to 1992. As a result, total development cost for HDB flats increased by about 81% over the same period. By comparison, the average price increase for all flat types over the period 1988 to 1992 was only 75%. Price increases over the same period for the smaller flat types which are meant for the lower income groups was only about 32%. Government has absorbed part of the cost increases over the period 1988 to 1992 so that housing continues to be affordable for Singaporeans. Given the limited land available in Singapore, HDB has always strived to optimise the use of public housing land without unduly compromising the quality of the living environment in HDB estates. HDB has, in fact, been increasing the development intensity of public housing estates over the years. HDB estates built in the 1960s and 1970s, such as Queenstown and Toa Payoh, have GPRs of about 1.9, while estates such as Ang Mo Kio and Clementi, which were developed in the 1980s, have GPRs of about 2.

5. The newer estates such as Pasir Ris and Tampines have a higher GPR of about 2.

8. The higher GPR is because we are building bigger flats whereas family size is getting smaller. Singaporeans have generally accepted the higher GPR in the newer HDB estates because the ambience and quality of the external environment is maintained. Further increases in GPR must be considered carefully to avoid a deterioration in the environment in HDB estates.

asked the Minister for National Development if he will state (i) the total amount of funds allocated by the Community Improvement Projects Committee to Town Councils for community projects in the years 1989 to 1992; and (ii) which Town Councils were granted such funds and how much was given to each of them in each of these years.

Community Improvement Projects Committee (CIPC) funds are allocated to the Citizens' Consultative Committees (CCCs) for projects in the whole constituency and not to Town Councils. Hence, no CIPC funds were allocated directly to Town Councils for community projects in the years 1989 to 1992. Since the implementation of the CIPC scheme in April 1990, a total of $65 million has been allocated to constituencies through the CCCs. The amount of funds allocated annually ranged from $80,000 to $527,000 per CCC, depending on the size of the constituency. CCCs may propose community improvement projects in HDB areas administered by Town Councils as well as projects in non-HDB areas which are not administered by Town Councils, for funding under the CIPC.

asked the Minister for Finance what is the health bill per annum for pensioners and what does this amount work out to per capita.

The health bill for pensioners was $16.05 million in FY 92 and this worked out to $1,076 per capita.

asked the Minister for Finance what is the health bill to the Government per annum of (i) civil servants and (ii) their dependants and what percentage of the payroll does the total bill constitute.

The total health bill to Government of civil servants and their dependants in FY 92 was $29.44 million, of which about 60% was spent on civil servants and the remaining 40% on dependants. The total bill constituted 1.43% of the payroll.

asked the Minister for Labour what percentage of members who withdrew their Central Provident Fund savings at age 55 years had the minimum required balance in their accounts.

Forty-six percent of CPF members who withdrew their Central Provident Fund at age 55 years in 1992 had set aside the full Minimum Sum.

asked the Minister for Labour what percentage of the workforce (excluding foreign workers) has no active Central Provident Fund accounts and what percentage of the self-employed has CPF accounts.

About 28% of our local workforce have no active CPF accounts. About 41% of self-employed persons have CPF accounts.

asked the Minister for Labour what is the estimated number of Singaporeans who are (i) casual workers and (ii) daily-rated workers and the gender breakdown.

The International Labour Organisation does not define "casual" workers. It would be very difficult to canvass and obtain information on whether a person is working "casually". In Singapore, we have defined a person who works for less than 30 hours each week to be a part-timer. This may be the closest approximation of a "casual" worker. The June 1992 Labour Force Survey revealed that 50,400 or 3.2% of employed persons worked part-time. Of these, some 33,100 or two-thirds were females, while males numbered 17,300. Majority of these part-timers are Singaporeans. The total number of daily-rated workers is not available. However, there were 4,913 daily-rated workers, mostly Singaporeans, in Government ministries and departments as at end-May 1993. No breakdown by gender is available.

asked the Minister for Labour whether there are any guidelines for factories or businesses who contract out home-based work.

Home-based work is of two categories. In Singapore, most home-based work does not involve employer-employee relationship. The usual arrangement is for a company to enter into a contract for service (as against a contract of service) with an individual party to perform a task or to undertake work at his home, using his own tools and at his own pace without any supervision. As he is not an employee of the company, he will not be paid a salary. Instead, he will be paid a fee based on work done for the company. An example of this type of home-based work is a housewife who undertakes to sew and complete dresses for garment factories in her own homes and at her own pace for a fee on a piece-rate basis. Another example is a freelance accounts personnel who helps a company to prepare and complete a set of accounts and be paid a fee for his services. As there is no employer-employee relationship, our labour laws do not apply to them. Should there be any dispute between the contractual parties, they would have to seek remedies in the Civil Courts. Another category of home-based work is those which involve employer-employee relationship under an employment contract of service. Under their contracts, the employees concerned could operate from both the office and their homes as long as they could deliver what is expected of them. With advanced technology in telecommunications such as computers and fax machines, more and more people are now able to operate from their homes. As long as such persons are covered by an employment contract, they are employees of a company, and the appropriate provisions of our labour laws will apply to them. An example of this category of home-based work is the journalist, insurance or property agent who is given the flexibility to operate both from the office and his home.