Hansard, 1996-11-07

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:- Mr Chew Heng Ching _ from 30th to 31st October and from 4th to 6th November, 1996. Dr Ong Chit Chung _ from 20th to 21st November, 1996. Dr Wong Kwei Cheong _ from 31st October to 7th November, 1996. Dr Wan Soon Bee _ from 31st October to 2nd November, 1996. Mr S. Chandra Das _ from 31st October to 1st November, 1996. Dr John Chen Seow Phun _ from 3rd to 7th November and from 10th to 15th November, 1996. Mr Ling How Doong _ from 5th to 8th November, 1996. Mr Chiam See Tong _ from 5th to 15th November, 1996. Dr Beng Kian Lam, Arthur _ from 5th to 7th November, 1996. Mr Lee Kuan Yew _ on 7th November, 1996. Mr Davinder Singh _ on 7th November, 1996. Dr Hu Tsu Tau, Richard _ on 7th November, 1996. Mr Bernard Chen _ on 7th November, 1996. Dr Tan Cheng Bock _ from 8th to 11th November, 1996. RAdm Teo Chee Hean _ from 8th to 11th November, 1996. Mr Goh Chee Wee _ from 12th to 16th November and from 18th to 19th November, 1996. Mr Koo Tsai Kee _ from 13th to 14th November, 1996. Dr Ow Chin Hock _ from 15th to 19th November, 1996. BG Lee Hsien Loong _ from 17th to 24 th November, 1996. Mr Mah Bow Tan _ from 18th to 21st November, 1996. TAN SOO KHOON Speaker Parliament of Singapore

The following Bills were assented to by the President of the Republic of Singapore on the dates stated: 29th October 1996 (i) Legal Profession (Amendment) Bill 1996; (ii) People's Association (Amendment) Bill 1996; (iii) Institute of Education (Repeal) Bill 1996, and (iv) Town Councils (Amendment) Bill 1996. 31st October 1996 (i) Parliamentary Elections (Amendment) Bill 1996; and (ii) Constitution of the Republic of Singapore (Amendment) Bill 1996. TAN SOO KHOON Speaker Parliament of Singapore

1. Assoc. Prof Walter Woon asked the Minister for Information and the Arts what is the rationale for paragraph 4(d) of the Singapore Broadcasting Authority Internet Content Guidelines which states that any matter that tends to "bring the Government into hatred or contempt, or which excites disaffection against the Government" shall not be allowed.

Mr Speaker, Sir, the Singapore Broadcasting Authority (SBA) Internet Content Guidelines help to set a minimum standard of conduct and community values in the parts of cyberspace that affect Singapore. They cover three key areas -

Sir, will the hon. Parliamentary Secretary say who will make the decision as to whether any website or posting is politically unacceptable?

Sir, normally the Singapore Broadcasting Authority will be the authority in charge of overseeing all activities, ie, whether or not it comes under the Sedition Act, whether it is political in nature or it promotes racial hatred and other commentaries. This matter will then be taken up and we will consult the Attorney-General's Chambers for advice as to whether it contravenes our laws or not.

Sir, I do not believe the Parliamentary Secretary has actually answered my question. We are not talking about committing an offence. We are talking about who is going to make the decision as to whether or not a website should be banned or a posting should be taken off. Who in the SBA? Is there a committee or is it a single person? Is there going to be a group of persons?

Sir, in the end, it is the Minister who has the power to decide. But before that, we also have the National Internet Advisory Committee which comprises people from the industry and community leaders from various groups who will look into all problems connected with Internet usage in Singapore. It will look into whether serious offences had taken place and recommend whether action should be taken by the Ministry.

Will there be any appeal procedure if, for example, it is determined that a particular website is political and therefore should not be allowed? Will there be an appeal procedure or will the decision be final?

Sir, a website that is political in nature is not disallowed. In fact, we have regulations which require political websites to at least register their editors or owners, and they are allowed to operate. The reason why we register them is to ensure some accountability and responsibility as we promote political discussion on the Net.

Sir, will the Parliamentary Secretary then confirm that it is not the Government's intention to curtail discussion and free expression on the Internet?

Sir, I can say yes, it is not our intention at all to curtail political discussions on the Internet. Maybe I will draw the Member's attention to some parts of the Sedition Act which allow exceptions to be made, ie, discussions which affect the Government but they were intended for good reasons. In other words, they found something which they thought it necessary to be discussed, reviewed and debated because certain activities in the state may not be good for Singaporeans. If the intention is good, I think the Government will not stop such discussions. In fact, the reason why we have provided certain laws is to ensure more transparency. People who use the Net would want to be sure that there is a level playing field with certain regulations to protect the innocent. There have been some developments but they are still relatively new. MITA will continue to monitor the situation and try to improve on our regulations either by tightening or loosening them up. These methods will be monitored continuously as the Internet continues to grow in our country.

For the avoidance of doubt, will the Parliamentary Secretary then confirm that Singaporeans are entitled to disagree with the Government and to say so freely?

I say yes, Sir.

asked the Minister for Law whether the Government acquires land for as little as $1.

Sir, as a general rule, the Government does not acquire land for $1. However, there are some special circumstances where it does so. These are: (a) firstly, where the land is that part of a site that has been set aside for public purposes such as roads or drainage reserves, as required under the planning approval given for the development of the site; (b) secondly, where the land is an odd piece which cannot be developed on its own and is designated for road or drainage reserves, such as backlanes, spray corners and public access roads; or (c) thirdly, where the land has been sub-leased by the owner for a long tenure like 999 years. In such a case, the sub-lessee would be paid the full statutory compensation. The owner is paid only the compensation for his nominal reversionary interest in the land, that is, his residual interest at the end of the sub-lease.

Sir, is the Senior Parliamentary Secretary aware that in the last issue of The New Democrat, the SDP had criticised the Government for acquiring land as low as $1?

Sir, this is typical of the SDP in trying to distort and mislead the people. It made it out that valuable plots of land were unjustifiably acquired at $1. Sir, I have explained the situation. In any particular case where an aggrieved owner feels that the land has greater value, say, that it has potential for independent development, there is an avenue of appeal under the Land Acquisition Act.

Order for Second Reading read. 12.40 pm

Sir, I beg to move, "That the Bill be now read a Second time." The United Kingdom's Sale of Goods Act 1979 is part of our laws being applicable by virtue of the Application of English Law Act (Cap. 7A). In the United Kingdom, changes have been made to the Sale of Goods Act 1979 by the Sale and Supply of Goods Act 1994 and by the Sale of Goods (Amendment) Act 1995. Both the Attorney-General and the Law Reform Committee of the Singapore Academy of Law have considered these changes and have recommended that our Sale of Goods Act be similarly amended. The Law Society also commends these amendments as they reflect the changing needs of consumers. Sir, the Bill therefore seeks to incorporate the relevant changes in our Sale of Goods Act. The amendments will bring our domestic commercial laws up to date with developments in the United Kingdom. Let me go through the main amendments. First, under the existing section 14 of the Sale of Goods Act, there is an implied condition in every contract for the sale of goods that the goods are of merchantable quality. The expression "merchantable quality" is outmoded and inappropriate, especially in the context of a consumer transaction. Its definition also emphasises too much the concept of fitness for purpose of the goods. Hence, the Bill replaces the implied conditions of merchantable quality with that of "satisfactory quality". This reformulated implied condition is intended to apply to all contracts for the sale of goods where the seller sells in the course of business. Whether goods are of "satisfactory quality" will be determined by reference, not only to fitness for purpose, but also to various other factors such as appearance and finish, freedom from minor defects, durability and safety for use. Secondly, the implied terms in the existing sections 13, 14 and 15 of the Sale of Goods Act are classified as "conditions". This gives a buyer an unrestricted right to reject the goods and treat the contract as repudiated if there is a breach of one of these terms, unless the buyer is deemed to have accepted the goods under the Act. The status quo will be preserved where consumers are concerned. For non-consumers, the law will be amended such that if the breach is so slight that it would be unreasonable for the buyer to reject the goods and treat the contract as repudiated, he will not be able to do so but will instead be able to pursue any other remedy against the seller, including the recovery of damages. Thirdly, under the existing law, property in the goods cannot pass to the buyer until the goods are ascertained. The buyer is therefore exposed to the risk of the seller's insolvency and if the price has been paid, may lose both the price and the goods. The amendments remedy this situation by enabling the pre-paying buyer to become an owner in common of the bulk and by laying down the legal implications of this relationship. This will give the pre-paying buyer a proprietary interest which he can enforce in the event of the seller's insolvency. Finally, Sir, the Bill clarifies the law relating to the acceptance of goods by a buyer. Under the present law, if a buyer accepts some of the goods sold to him he will be treated as if he had accepted them all. The amendments made by the Bill will enable the buyer to accept all the goods which conform to the terms of the contract and reject all the goods that do not, or to accept the conforming goods and some of the non-conforming goods and reject the rest. Sir, the amendments also make it clear that a buyer who asks for goods to be repaired, or agrees to their repair, will not be deemed to have accepted them merely because of his request or agreement, and that a buyer will not be deemed to have accepted the goods merely because he sub-sells them and delivers them to another person, or disposes of them in some other way. Sir, these changes are not intended to bring about any major shift in the balance of rights and obligations as between a buyer and a seller of goods. They are to update and clarify the law relating to the sale of goods so as to benefit buyers and sellers alike. 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. - [Assoc. Prof. Ho Peng Kee]. 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." Sir, this Bill is closely related to the Sale of Goods (Amendment) Bill, which we have just dealt with. By virtue of the Application of English Law Act (Cap. 7A), Parts I and III of the United Kingdom's Supply of Goods and Services Act 1982 and Parts I and III of the United Kingdom's Unfair Contract Terms Act 1977 are applicable in Singapore. Like the United Kingdom's Sale of Goods Act 1979, these enactments are reprinted in our Revised Edition of Statutes as part of our legislation. Sir, in the United Kingdom, changes were made to Parts I and III of the Supply of Goods and Services Act 1982 by the Sale and Supply of Goods Act 1994. Again, both the Attorney-General and the Law Reform Committee of the Singapore Academy of Law have considered these changes and have recommended that our Supply of Goods Act be similarly amended. As such, this Bill seeks to incorporate the relevant changes in our Supply of Goods Act. As in the case of contracts for the sale of goods, the new reformulated implied condition of "satisfactory quality" will replace the existing implied condition of merchantable quality in all contracts for the transfer of goods and contracts for the hire of goods. Also, where there has been a breach of contract by a transferor or bailor towards a non-consumer transferee or bailee and the breach is so slight that it would be unreasonable for the transferee or bailee to reject the goods and repudiate the contract, the transferee or bailee will not be allowed to do so but he will be able to pursue any other remedy including the recovery of damages. Finally, the Bill also incorporates in our Unfair Contract Terms Act an amendment similar to that made by the UK's Supply of Goods Act 1982 to Part I of her Unfair Contract Terms Act 1977. This amendment provides that, in a case where the possession or ownership of goods passes under or pursuant to a contract not governed by the law of sale of goods or hire-purchase, liability for breach of the obligations arising under section 2 of the Supply of Goods Act cannot be excluded or restricted by reference to any contract terms which purport to exclude or restrict liability for breach of obligation arising by implication of law from the nature of the contract. Sir, again, may I say that these changes are not intended to bring about any major shift in the balance of rights and obligations as between a buyer and a supplier of goods but to update and clarify the law relating to the supply of goods so as to benefit buyers and suppliers alike. 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. - [Assoc. Prof. Ho Peng Kee]. Bill considered in Committee; reported without amendment, read a Third time and passed.

Mr Speaker, Sir, I beg to move, *That this House endorses the conclusions of the Cost Review Committee contained in Misc 4 of 1996, and calls on the Government to accept the recommendations to contain rises in the cost of living and to assist the poor and the elderly. Sir, the Cost Review Committee has done very good work. The findings and recommendations contained in the CRC Report are comprehensive, straightforward and down-to-earth. The Committee was represented by academics, businessmen, journalists and trade unionists. They were ably supported by the officials of different Government Ministries. The task of the CRC was not easy. They had the most unpleasant meeting with the Singapore Democratic Party (SDP) and Pertubuhan Kebangsaan Melayu Singapura (PKMS). The meeting was marred by bad manners, hostile attitudes and irresponsible behaviour displayed by the two opposition parties. Fortunately, the CRC meetings with the other organisations, like the Consumers Association of Singapore, Emporium Holdings and NTUC Fairprice were more sober and fruitful. It was obvious that Dr Chee Soon Juan and his group were out to confuse and mislead the public with distortions. Dr Chee has the habit of making wild and unfounded allegations. He would bring up isolated cases and personal anecdotes and treat them as though they are rampant in Singapore. He should know better that one swallow does not make a summer. It is true that prices and costs have risen but the increases were by no means "phenomenal" as exaggerated by SDP and PKMS. The vast majority of Singaporeans are enjoying higher standards of living and better lifestyles than before. Dr Chee is not known to see issues in perspective and in the context of the overall environment. Having raised the issues, he is not interested in seeing them through to their logical conclusions. The CRC has been steadfast in its work. It did not set out to work for the sake of the opposition parties. The members used their time and expertise in the interest of Singapore and Singaporeans. For the SDP and PKMS to allege that the cost of living represented by the Consumer Price Index was hidden from the public through a "statistical massage of numbers" was a grave affront to all Members of Parliament. Every year, Parliament debates the Government budget of expenditure. Are they suggesting that we MPs are being misled? And worse still, Parliament is insinuated as perpetuating the misrepresentation of official statistics. I wonder what the Opposition Members of Parliament have got to say of these accusations. I am glad that the CRC in making its independent and objective evaluation has once again re-affirmed the integrity of Singapore's statistical system and the consistency and soundness of the Consumer Price Index. The MP for Hougang, Mr Low Thia Khiang, has chosen to stay away from this year's CRC deliberations. I think Mr Low wanted to avoid having to agree with the findings of the CRC. He would not want to be put in the awkward position as an Opposition MP. Nevertheless, at the Select Committee on Health Care Subsidy of Government Polyclinics and Public Hospitals, Mr Low had praised the work of the Auditor-General. After reading the CRC Report, would Mr Low also commend the work of the Chief Statistician this time? Perhaps Mr Low would like to give his view to this House on the work of the Chief Statistician and the Department of Statistics. As Chairman of GPC for Health, I am naturally interested in the findings and recommendations of the CRC on health care issues. As we discuss the cost issues on health care, it is important for us to recognise and acknowledge that Singapore has one of the best health care systems in the world. Even then, we should not stop in making further improvements. Perhaps, we can now fine-tune our health care delivery system so that individual Singaporeans can be given the best possible care befitting his individual circumstances and medical conditions. The Health Ministry has recently pledged to intensify the efforts on financial counselling to patients on admission to hospitals. The Ministry has also agreed to remove all unnecessary red-tapes that may cause inconvenience to the patients and their families. This firm commitment and action would lead to even better quality service in the public hospitals and Government polyclinics. Sir, there are some patients, because of their chronic conditions, can ill-afford to pay cash of a couple of hundreds of dollars a month for their long-term medications. I join the CRC in urging the Health Ministry to extend the use of Medisave savings for some outpatient medical tests and treatment that are necessary to maintain the health status of patients, particularly elderly patients, and to prevent complications. Recently, I visited the Alexandra Hospital. I am very impressed by the excellent facilities provided at that Government hospital. Alexandra Hospital has very good subsidised B2 and C class wards to look after the elderly patients. They have the Geriatric Centre to cater to the special medical conditions and needs of the elderly patients. More publicity should be given to encourage Singaporeans to use the medical facilities at Alexandra Hospital which is relatively cheaper compared to the other restructured hospitals like SGH and NUH. It would appear that the opt-in system for MediShield coverage for dependent children did not work. Generally, healthy people pay little heed to the need to sign up for medical insurance until it is too late. As the response to MediShield protection for dependent children is poor, with only 25% being covered, the Health Ministry should change the opt-in system to an opt-out system for the benefit of our young children and their families. I share the concern of the CRC that a quarter of the elderly Singaporeans over 60 years old have opted out of MediShield coverage when one would have thought that they need the insurance coverage most. This matter needs closer study by the Health Ministry to entice the elderly to cover themselves under MediShield which is actually good for them. The financial burden can be very heavy when stricken with a catastrophic illness. I wonder if this is related to their inability to use CPF savings to pay for MediShield premium when they are retired and no longer contributing to CPF. The suggestion of the CRC to work out a personal MediShield endowment account to keep the MediShield insurance coverage alive is an interesting one. Sir, on 13th January 1994, when moving the motion of thanks to the President for his Speech to Parliament, I had raised the subject of reverse mortgage to help the elderly in their living expenses. The CRC has recommended, "that reverse mortgages be made available to the elderly to benefit from the rise in the property values over the years." The HDB should seriously consider how a reverse mortgage scheme could be implemented to help the elderly who are in need without jeopardising the virtues and values of the strong traditional family-support system. The cooperative movement based on the principles of thrift and self-help has worked successfully in Singapore. The cooperative spirit should be extended to areas that can provide tangible benefits to Singaporeans. I support the CRC's call to the Government to facilitate the setting up of housing cooperatives to build private properties at lower cost and pass back the savings to the buyers who are members of the cooperative. In preparing for the aging population, the NTUC has mooted the idea of building retirement villages within HDB housing estates so that the elderly can continue to stay in the community. The retirement village is good for those who choose and can afford to live in these retirement villages. Sir, for the less fortunate elderly, I wish to suggest that the HDB redesign and reconfigure the present 1-room rental flats provided for aged singles. We should make more economical use of the space and reduce the need of building more nursing homes in the future. At certain floors of HDB blocks, common facilities can be provided. We can encourage voluntary welfare organisations to adopt and provide services to the frail and the aged to live independently in these dormitory-type accommodation. It is not only the money that matters but also the physical help and the ability to socialise with others are as much needed by this growing segment of our population. As Singapore continues to progress and grow, more and more Singaporeans will enjoy the fruits of the country's success. Unfortunately, the rewards are not evenly distributed. Those with the right skills and talents will be better off. The challenge for us is to ensure that Singaporeans continue to have good jobs and good salaries. We have to learn to be self-reliant and to live within our means. We have to recognise that life is full of ups and downs. There will be good years and not so good years. We should not envy others who are better off than us. The cost of living issues raised by the opposition parties are out to divide our people. They fan the emotions of our people. They play up the weak nature of people, to be envious of others. This will break down the social fabric of our society. This will work against our national interest and objective in making our people work together, be united and live in peace and harmony. For those Singaporeans who are well off, they should not flaunt their wealth. The wealthy should not be so arrogant as to look down upon the poor, weak and helpless. The rich must help the poor and the strong for the weak. This makes for a compassionate and gracious society. We must keep the trust between our leaders and our citizens. As we move into the new millennium, there are many countries in the region wanting to catch up with Singapore. If we were to let down our guard and go for soft options, we do so at our own peril, then we deserve the bad consequences. Sir, I have faith in the Singaporean. We are a small country but a rich people seeking justice and righteousness, both in spirit and in truth. I have no doubt that together we can overcome the external forces, provided we do not allow the internal enemy to break us and cause our downfall. Otherwise, we do not even stand a chance against the external competition and overcome them. If Singaporeans know how to differentiate between the right from wrong and the good from evil, Singapore will remain successful because we all make it so. Sir, I beg to move. Question proposed.

( In Mandarin): Mr Speaker, Sir, of late, much has been said about the rise in the cost of living. Is it true that our rising cost of living has become a problem to the people of Singapore? How serious is the problem? On the other hand, why is it that the Consumer Price Index (CPI) in Singapore is only rising rather gradually? For example, in 1993, it was only 2.2%. In 1994, it was 3.1%. In 1995, it was 1.7%. At the same time, the Singapore dollar has been very strong. In 1993, the conversion rate was US$1 to S$1.

50. Now it is US$1 to just only S$1.

40. Because of this, we are in a better position to purchase imported goods. This is a fact well known to people around the world. Yet, many people simply refuse to acknowledge this fact. What is Consumer Price Index? What is cost of living, and what is inflation? Most people do not fully understand these issues. Now, at least, we have a very scientific and systematic paper in the form of the Cost Review Committee Report to explain these issues to the people in a down-to-earth approach. This report very clearly explains what is cost of living, how it has been rising and what are the reasons for the rise in our cost of living. At the same time, this Report has also made some very constructive recommendations. If we can spend some time to read this Report objectively and to share the contents therein with our family members and friends, this would certainly help to alleviate our worries and concern about the rise in cost of living. This Committee has collated the views from various quarters on the various elements of daily lives, such as clothing, food, housing and transportation. The conclusion is that our cost of living has indeed risen over the past few years, but the margin is low and it is well under control. What is the reason for the rise in the cost of living? Why is it that people are still worried about it? According to reflections by some of our grassroots leaders, most people do not understand that because of changes in their lifestyles and expectations, and because we want to buy better goods, use better services, receive better medical care, we incur higher expenditures, hence higher cost of living. We want to upgrade our flats, we want to have more rooms! We want to live more comfortably, and this will surely mean paying more for it. Worse, some people are speculating on properties resulting in the escalation of property prices, and people link the soaring property prices to the cost of living. Mr Speaker, Sir, let me give you an example. From 1987/1988 to 1992/1993, within this five-year period, the average household expenditure increased by 76%. This is a fact. Let me round up the figures. The average household expenditure was raised from $1,500 to about $2,600, an increase of $1,100. But in this increase of $1,100, the actual increase in property prices is about $200, ie, about 14% of the CPI. As for the other $900, the rise was because of changes in our lifestyle. So if we go home and write down on a sheet of paper what we were using five years ago and what we are using now, we would be convinced that the rise in cost of living was, to a large extent, due to changes in our lifestyle. In the past, our people were quite contented to consume ordinary white rice. Now, according to NTUC Fairprice Supermarket, more than 90% of our people are buying 100% fragrant rice and not the ordinary white rice. In the past, we used to feed our dogs and cats with leftover food. Nowadays, our dogs and cats are eating special pet food. My hawker friend told me that many people bought pig liver, pork ribs and a host of other good foods to feed their pets at home. At the fruit stall, fruits which are not so fresh or of lower grades will find no takers. Likewise, a fish-seller told me that nowadays people go for only the very fresh and supposedly higher-grade fish and shun the not-so-fresh fish and cheaper species of fish. Our children now go for seedless grapes. They do not want ordinary grapes with seeds. . Apart from all these changes in lifestyle, our family structures are also different. Nowadays, when young people get married, they do not want to stay with their parents. They want to live by themselves and because of this, they would have to set up their own homes. They have to do their own cooking. They have to employ a maid to look after their children. These will inevitably increase their household expenditure. When you are living with your parents, you have them to help you with the cooking or the washing. Of course, I am not saying that we should treat our parents as servants but we can surely have someone to share in our household chores. This would make our living more comfortable, and incur less expenditure. Now, many women folks are working. 50% of the married women in Singapore are working. Accordingly, more families are eating out. Take, breakfast, for example. For breakfast, if we eat at home, an egg will cost you about 15 cents. If you eat two eggs, they are only 30 cents. But if you eat in a coffeeshop, two eggs will cost you no less than $1. A breakfast in a coffeeshop will cost you at least $2. But if you have your breakfast at home, the same food would cost you not more than $1. But I do understand that now, with both husband and wife working, they may not have the time to cook their own meals. But whenever possible, we should try to do our own cooking and eat at home. This will help to reduce our household expenditure. This Report recommended that the hawkers should form some sort of cooperative to increase their productivity, to improve their manner of operation, and pass the benefits derived therefrom to the working couples. A friend of mine operates a store in the market by selling clothes to housewives and people who frequent the wet market. She told me that nowadays her stocks consist of mostly imported dresses from Hong Kong, Taiwan, and even the United Kingdom and other European countries. Nobody wants to buy locally-made clothes. I wish to stress that this is a market store in a housing estate, not a boutique in downtown Orchard Road. Our people are now very discerning about our clothes. I notice that cosmetics are now a lot more expensive than before. But people are using them liberally. The senior citizens in my constituency are all putting on make-ups when they come to our functions at the community centres. They are spending a lot on cosmetics! The Government has spent a lot in building schools, colleges, polytechnics. and it offers various forms of subsidies, scholarships, merit awards and bursaries. We notice that many other countries are now reducing their expenditure on education because their governments cannot afford it. But in Singapore we are spending more on education. Our tertiary students have increased from 39,000 to about 85,000 in each cohort. Our children have better opportunities to receive tertiary education. More students are going to polytechnics and universities than 10 years ago. This, of course, will increase the household expenditure of the parents. I suggest that we accept the recommendation of the Report. For those families whose income is between $2,000 and $3,000, although they are not considered to be low income, I think we should also extend the grant of the bursaries or educational loans to them as well, because education is a long term investment and not a consumption item. As for the pre-primary children, the expenditure is also higher because, as I said, the demands are different now. In the past, our children did not go to kindergartens. Nowadays, it has become a necessity for children to go to kindergartens, and even pre-kindergarten nursery classes. In fact, 99% of children in Singapore go to kindergartens and the fee is about $30 to $40. If you have two children, it comes up to $80 a month, not forgetting that their pocket allowances have also increased. We try to give our children more chances of learning, for example, singing classes, art classes, dancing, piano, computer, Internet, etc. Every parent has this aspiration of letting their children learn as much as possible. There is nothing wrong with it. The other day when I was presenting bursary awards to my constituents, I was asked, apart from helping the children to pay for their school fees, whether we are considering subsidising their tuition fee as well. To many parents, tuition has become a necessity now. Another matter that has been worrying us is the commodity prices. It is a fact that commodity prices have increased, particularly in private housing where the margin of increase is very large. Although only those who buy properties are affected by this, everybody is talking about it. In fact, everybody is affected, directly or indirectly, by this increase. Many people feel that if they do not buy now, they may not be able to afford it later on. This Report gives a very clear explanation that there are always the ups and downs in property prices. For example, in the 80s they had gone up very high and by 1985/86, they tumbled down. In 1993/1994, there was again another big jump in property prices, but we know that the property market has now softened. But some opposition parties are trying to incite the people. They link the rise in property prices with the cost of living and cause unnecessary fear among our people. This Report has asked for an assurance from the Government that our people will be able to afford to buy at least a HDB 3-room or 4-room flat. Recently, an opposition party has taken up the point of the Government acquiring land at the nominal price of $1. Of course, the Government has been acquiring land, but it is offering compensation based on market prices. The Government has given this guarantee that they will value the land according to market prices. So I do not think we need to worry about it. Many people want to live more comfortably and they claim that they are purchasing bigger houses or flats as a form of investment. By so doing, they have to take up bigger loans. Some young people who have just started working are known to have taken up loans amounting to hundreds of thousands of dollars or even as much as a million dollars. As a result, they will have less cash available at their disposal. It will also cause them much mental strain. This Report has also recommended the formation of cooperatives so that professionals could group together and build houses for themselves, thereby helping to stabilize the property prices. Just now, Mr Loh Meng See mentioned about Medisave and the problem of the aged. Personally, I know that the Ministry and the GPC for Community Development have often discussed the problem of our aging population. I can say that the Government has many schemes to help our senior citizens. One of these is Medisave and MediShield which are the safety nets for our health care. Why is it that our people still do not fully comprehend the concepts of these safety nets? We should have more publicity on these facilities to educate and explain to our people. Often it is not easy to explain and let our people, particularly the older people, understand these benefits available to them. I would suggest to the Government that we should have better education programmes on these medical benefit schemes for our people so that all these efforts by the various Government agencies could be fully understood by the people. Another point that I would like to raise here is that apart from explaining the schemes to the people on the receiving end, we should also provide more training to the civil servants who are responsible for the implementation of these schemes. It is now a consumer's society. Each Ministry should set up a Customer Services Department to provide better services to the people who are its customers and to enlighten them on the types of facilities available to them. . We should narrow the gap and alleviate any misunderstanding between the people and the Government. I encourage grassroots leaders and the officers of various Government departments to spend some time in studying this Report. If possible, they should explain the contents of this Report to the ordinary folks so that the people of Singapore would have a better understanding of issues relating to our cost of living, Consumer Price Index, inflation, etc, so that they would not be unduly worried about the rising cost of living. Finally, I would urge the Government to do three things. Firstly, create employment opportunities so that we have a full-employment situation. Only if we have a full employment situation can we talk about raising our income level. With that, we can ask for a better quality of life, bigger houses, etc. Eventually, what we should do is that we must maintain our competitiveness. We must have good job opportunities and full employment for everybody. Secondly, as raised by Mr Loh Meng See just now, enhance our social cohesiveness. We must reward the able but we should also provide training and education to the less-able in order to narrow the gap between the rich and the poor so that everybody would have the opportunity to participate in the progress of our nation. We have now a very transparent system in Singapore. Everybody has a chance to participate. As we know, some of our Cabinet Ministers come from ordinary families. So any Singaporean who is willing to work hard will have the opportunity to become an MP or even a Cabinet Minister if they are successful in their endeavours. Those who have made it should not be too proud or extravagant in their spending. They should try their best to help those who are less successful and the less privileged. That is to say, when we reward the best students we should reward not only the first three prizes, but also give some consolation prizes so that more people could be recognized. To have better social cohesiveness, we must first of all have political stability. We must have the best people to be in the Government. Otherwise, we would not be here talking about cost of living. If we look at it calmly and compare the situation in other countries with our way of life in Singapore, whether it is clothing, food, accommodation, or transportation, the basics have already been provided. Now people are talking of living in better houses, travelling in air-conditioned buses, bigger cars, etc. It is because of the sound policies of the Government and the solid support of the people for the Government that Singapore has been successful. I urge the people to cooperate with the Government to make Singapore an even better place to live in. I support the motion. 1.25 pm

( In Malay): Mr Speaker, I take part in this debate with a bit of disappointment because this issue is coming back for discussion now. The show started from accusations by the Singapore Democratic Party. But, unfortunately they are not represented here today. It was designed by the leaders of the SDP to mislead Singaporeans and that we have to reconvene the Committee to review the matter and satisfy some Singaporeans who had been misled by these accusations. If we look at the Report of the Cost Review Committee we will find that the accusations were not only untrue but were also made with the intention to mislead and create anxiety among Singaporeans. The Report of the Household Expenditure Survey was conducted in 1993. The SDP used it as an issue again this year and there is no doubt that it is intentional because of the impending elections. The fact that it is raised once again is not an issue but it is raised to create confusion and anxiety. If we look at the Household Expenditure Report 1993, it clearly shows that inflation had actually gone up 14%, but most Singaporeans had spent 76% higher than previous years, ie, between 1983 and 1988. What actually happened was that most families and individuals who are working today have higher incomes and therefore they have bought bigger houses, higher quality imported fruits, and so on. In other words, more Singaporeans, in recent years, have been enjoying their lives. They have higher incomes which they feel could be used for enjoyment and to lead a more comfortable life. Also, because more Singaporeans are now working harder, they want to spend more. But the increase in expenditure can only come about because of higher income and not because of higher cost of living, as has been made out by the SDP and PKMS report. I refer to the statistics issued by the Statistics Department which show that household income in Singapore, on average, was $2,190 a month in 1988 and this has risen by 63% to $3,564. In the same period, family expenditure in Singapore went up from $1,500 to $2,600. And we find, on the whole, income went up $1,374 in the same period while monthly household expenditure went up $1,100. This shows that there was still a surplus of $235 a month after the increase in expenditure by 76%. At the same time, if we compare the 1988 income and expenditure, there was a saving of $700. And in 1993, after they had spent more, there was still a saving of $922. Perhaps, the SDP and PKMS do not know how to study the figures and that is why they said that there had been a statistical massage. But I think this confusion arose because some of them, perhaps their colleagues or friends in PKMS, could have advised and helped the SDP to understand the statistics like those people making epok epok or roti prata. I think they are confused. The questions, accusations and claims are not like people making epok epok or roti prata. They are far from it. Because if you read the basic statistics, these accusations should not have arisen at all. It is not just expenditure that has gone up, savings have gone up. In 1988-89, individual savings in POSB were $5,700. But in 1993, which was not touched and put across by the political parties, it went up to $8,300, an increase of 46%. In 1988, individual savings in CPF were $61,300. By 1993, it was $84,800, an increase of 38%. All these figures show we can spend more, enjoy better life because we have earned more income, partly because we have worked hard and our earning power has also increased. I can also give another example of how Singaporeans have used higher income to enjoy better quality goods. The statistics show that more Singaporeans today are keen to purchase bigger houses. From 1988 to 1993, the number of people who lived in 3-room flats went down by 29,100. In the same period, 71,300 more of 4-room and 5-room units were purchased. This shows that monthly payments to the Town Councils, electricity or monthly expenditure for bigger houses had also gone up. And this increase is of our own choice because we want bigger homes. Within the same period, although the cost of electricity has gone down by 7.5%, Singaporeans spent, on average, 15% more on electricity. In 1992-93, up to 35% of Singapore homes had airconditioning compared with less than 20% in 1988. The use of washing machines went up from 74% in 1988 to 81% by 1992-93. In 1993-95, up to 30% owned more than one television set. In other words, we used to share one television set, but today the parents can watch their own programmes while the children can have another television set and they switched on both television sets at the same time because of different interests. This is because families have higher incomes and they can afford more than one television set. They can afford to enjoy more programmes and use more electricity. I also find that the expenditure on radios, television sets and musical instruments went up by 298% whereas the prices of these items have gone down. But perhaps because the prices have gone down, more people are buying television sets, radios, including karaoke sets too. This partly explains how we are enjoying better lives with quality goods. Another example is that in NTUC Fairprice, for instance, we find that they are selling up to 91% of fragrant rice. Whereas when you compare 10 or 15 years ago, only about 60% fragrant rice was sold in NTUC Fairprice shops. People who used to buy sardines are today buying tuna. In other words, sale of tuna has gone up by 187%, whereas sale of sardines, which we used to buy regularly before, went up by only 22%. Mr Speaker, what has happened is that the choice made by Singaporeans to enjoy a better and comfortable life has become a habit. As a result, between 1988 and 1993, we find that the number of people who used handphones had seen an enormous increase. In 1993, the number had gone up to 162,500. Although the cost of handphones has gone down by more than half compared to 1988 and because more Singaporeans can afford to buy these handphones, our expenditure on telephone equipment, handphones and pagers has gone up by 880%. This has happened even though the price of handphones has decreased. In 1988, 156,500 persons had pagers. By 1993, more than 524,800 people were using pagers. It is an increase of 235%. I do not know what is the figure today, maybe much higher. If you just compare 525,000 pagers and if one person represents one family of four or five persons, perhaps every family in Singapore has one person carrying a pager. In other words, all Singaporeans are connected to one another with pagers. That is the figure for 1993, Mr Speaker. Today, I am sure the figure is even higher and is increasing. Pagers here are cheaper. People are buying new pagers, perhaps even more beautiful and nicer ones which can send messages, greetings, and so on. Some pagers can be used to convey expressions of love to their girl friends. I also find, Mr Speaker, that the expenditure for computers at home between 1988 and 1992 had gone up by 573%. This is much higher than the 76% that was mentioned by SDP and PKMS. But if you look at the figures, I think we should find out what actually is happening. Have computer prices gone up by 500%? No. What has happened is that within the same period, computer prices had gone down by 29%. Since computer prices had gone down it means we should be spending less than before on computers. But the expenditure on home computers has gone up by almost 600%. In 1988, only 11% of homes here could afford computers. By 1992, 20% of Singapore families could afford to buy computers and more people are buying computers. I have, when meeting my constituents, seen not one, not two, but some families, because of the parents' interests in education, have a computer for each one of them. So there is one PC for the boy, one PC for the girl, one PC for the father and another PC for the mother. The whole family has a computer for each one of them. Mr Speaker, in 1988, 26,800 families in Singapore had maids. In 1993, the number has gone up to 70,000 families. Last year I think it must have gone up to 90,000. As a result, Singaporeans' expenditure on maid's service has gone up by 200%. This shows that because we can afford it and we want to enjoy the comforts of life, we want somebody else to do the household chores like washing dishes, clothes and so on. It is the same thing with food, Mr Speaker. With food, we find that expenditure on eating out in fast-food restaurants has all gone up. Before, Singaporeans used to go to the market, chose the fish, vegetables and so on. They would bring them home, clean them up, and cook them for the whole family. Today, we have maids and we are spending less time at the market. We have money. We go to the coffeeshops, food courts and so on, and that is our enjoyment. We can do so only because we can afford it and this is because of a better economy, higher value of the Singapore dollar and stability in the country, so much so that even after midnight we find a lot of people going out to dine. All over Singapore, we find 24-hour food centres. Singaporeans do not stop eating. Mr Speaker, last year, if I am not mistaken, for the first time, the number of 4-room HDB flats was far greater than the 3-room flats. Previously, Singaporeans could only afford 3-room HDB flats, but by last year, this was not so. The age where 3-room HDB flats are in the majority in Singapore has passed. Today, most Singaporeans buy 4-room, 5-room or Executive flats. In 1991, 7,700 units of 4-room flats were sold to Singaporeans. They were sold to those who already owned 3-room flats and wanted to upgrade to bigger flats, or to newly married couples. By 1995, the number of 4-room flats sold by HDB was 12,000 units, almost double. In 1991, the number of 5-room flats sold was 2,700 units. In 1995, 11,100 units were sold, almost a 500% increase. And for Executive flats, in 1991, 2,000 units were sold. In 1995, 3,500 flats were sold. Lately, it was reported that Singaporeans are busy buying Executive Condominiums. They are not compelled to do so. It is their choice. They want more comfortable homes. They can afford and they are willing to spend more. Does this mean that Singaporeans are facing more difficulties in paying for these more expensive HDB flats? From CPF figures, about 87%, almost 90%, of Singaporeans generally pay their monthly instalments on home loans completely by using CPF savings. Their income has gone up 63%. Their contribution still remains at 20% from each side. And even though the cost of houses has gone up, 90% are still paying their instalments from CPF without having to use their take-home pay or cash to pay for their house. In other words, what is happening is that the CRC Report has gone a long way to show that we are enjoying a more comfortable and better life, better than what we have ever enjoyed before. I think Singaporeans have never enjoyed as good a life as we are enjoying now. We, as a country, moving as a team, should work towards better standards so that what we are enjoying today will be even better in the future. But there are people who are trying to weaken our spirit to work harder and to succeed in the future, by saying that we are having difficulties. That is why the SDP is saying that prices have gone up "no less than phenomenal", to use their own words. In my own interpretation, since the coup d'etat in SDP by Chee Soon Juan, what has happened is that the number of accusations, lies and confusing figures from the SDP has gone up enormously, and they are no less than phenomenal. And this is happening again in the case of the cost of living issue. I think this is not only a wild accusation but it is a bad accusation. This is very sad because they have ridiculed such a major and serious issue. They have played around with it in view of the impending elections. I am happy that the CRC Report has not only proven that we are enjoying a better life than before but has also given recommendations on certain areas where we still need to give attention, especially for those who are in the lower-income group. The Government should give attention to these problems, if any, so that, wherever possible, we could render assistance. Sir, I support the motion by Mr Loh Meng See.

( In Mandarin): Mr Speaker, Sir, the Cost Review Committee Report stated that between 1988 and 1993, the prices of commodities taken to compute the Consumer Price Index increased by only 14%. But the fact remains that the average household spending had increased by 76% during the same period of time. The Report concluded that the increase in household expenditure was due to the people's choice for a "cosier-but-costlier" lifestyle. In other words, people have themselves to blame for the increase, and that it has nothing to do with the social environment and development trend. Let me give you a few illustrations: The Report pointed out that Singaporeans are eating out more often. However, has the Committee really looked into the matter as to why people have to eat out? Do they know that people have to eat out more often because the women-folk are working, and even work overtime to help support the family? They have no time to do their own cooking at home! The Report also pointed out that more and more people are employing domestic help. Do they know that working couples have to employ domestic servants because the Government has been encouraging the women to join the workforce, and there is nobody to look after their children at home? The Report has overlooked the necessity of the people, and put the blame on them, by saying that they are pursuing "comfortable and expensive" lifestyles. This is unduly harsh and unfair comment on the people. The Report stated that it is popular for our people to buy lobsters, abalone, D24 durians, etc. I do not know whether this is really the standard lifestyle of Singaporeans, or just the lifestyle of the hon. members of the Cost Review Committee. The Report also mentioned that expensive cars such as Mercedes and BMWs are the first choice of the people of Singapore. Really, how many percent of our people can actually afford to buy a Mercedes or BMW? Can the Government tell us what is the income level of the people who can afford such expensive cars? On HDB flats, the Committee shares the Government's view that Singaporeans can afford to buy HDB flats, despite the escalation of prices. The Report repeatedly emphasized the point that the Government has given the assurance that if the people's income level goes down, the prices of HDB flats would also go down. But the fact remains that between 1990 and 1995, the average selling price of a HDB 4-room flat has risen from $76,000 to $121,000, an increase of 59.3%. The average selling price of a HDB 5-room flat has also risen from $95,000 to $191,000, an increase of 100.7%. This is much more than the margin of increase in salaries, and our people have to carry a heavier burden to service bigger housing loans. The tables on page 108 of the Report show that from 1990 to 1995, the outstanding housing loans of Singaporeans have grown by more than $10 billion. If we have the misfortune to be hit by a recession resulting in massive unemployment, then many people will have difficulties meeting the monthly instalments and may even lose the roof over their heads. This is indeed a worrying thought! Nowadays, when any Government agency wants to increase its tariff charges, it would simply make an announcement in the newspapers and that is all. Generally, the people are in no position to know whether the increases are reasonable or not. I feel that Parliament should set up a standing committee known as the Commodity Prices Monitoring Committee to examine the increase in charges and, if necessary, a public hearing should be conducted requiring the Government agencies to give data to support their increases. Rise in the cost of living is of great concern to the daily lives of the people. The Government now openly admits that the cost of living has indeed risen and is concerned over its implications. This is a good start. However, just by admitting it and showing concern are not enough. The important thing is how to contain the rise in the cost of living to lighten the burden of the people. When our people have to work so hard to earn a living and to make ends meet, how can they spare the time to bother about being gracious, not to mention building up a gracious society!

Mr Speaker, Sir, the main objective of economic development is to raise the standard of living of the people. On the one hand, it is to increase the earnings of the people and enhance the values of their assets. On the other hand, it is to check the increase in prices or inflation rate. The Singapore Government has been successful in both aspects. Last year, our per capita GNP had reached $30,770, while earnings of the people had risen by an average of 0.7% annually over the past five years. Almost 90% of the families own their own homes. In the past five years, the Consumer Price Index (CPI) rose by an average of just 2.2% annually. The strong Singapore dollar makes imported goods cheaper and overseas holidays less expensive than before. Then, why is it that many Singaporeans are still worried about the increase in cost of living? Why are people so concerned that they are unable to afford the purchase of HDB flats or that they may not be able to pay for their medical expenses when they fall ill? There is a fundamental principle of economics known as "unsatisfiable want, limited resources". On the demand side, when the income is increasing, purchasing power is also increased. Naturally, there will be higher demands for better and more consumer goods; for example, superior grade fragrant rice, quality seafood, vegetables, better electrical appliances, more branded clothes, etc. Furthermore, with changes in lifestyle, more families dine out in restaurants more frequently; more families are employing domestic servants; and more people are going for holidays overseas. This is the consequence of their choice. Wanting to have a more comfortable standard of living is a natural aspiration. It is actually a motivating force to make people work harder. In his speech just now, Mr Low Thia Khiang said the increase in household expenditure was due to the people's choice to opt for a more comfortable and expensive life, implying that the people have themselves to blame. In my view, this is not a fair comment. As I said, wanting to have a better life is a natural aspiration of the people, and it is a motivating force. Of course, the changes in the number of family members and their ages would also increase the household expenditure. The middle-aged head of household has to maintain his parents as well as support his children. Household expenses, particularly in education and medical expenses, must surely go up. Changes in the stages of life cycle and the family structure are inevitable. However, in the entire working life of a person, income during his middle age should relatively be the highest. They should be selective in their expenditure and make the necessary adjustments. For example, when he wants to send his children overseas for study, he would have to sacrifice or delay his plan to upgrade to a bigger flat or to a private property. On the supply side, our human resources and the size of our land are limited. Under such constraints, economic growth and higher demands will push wages and land prices higher, resulting in increasing operating cost for labour-intensive services such as health care, education services, and land-intensive activities such as property and transportation . Such increases in cost are inevitable. However, improvements in productivity, management efficiency and technological advances may, to some extent, offset part of the increase in unit cost. The combined effect of the demand and supply factors is the increase in household expenditure. For the five-year period between 1988 and 1993, the average monthly household expenditure increased by 76%. But only 14 percentage points were due to price increase in consumer goods while another 62 percentage points were due to more comfortable lifestyle and changes in family structures. The Cost Review Committee has also found that between 1993 and 1995: (1) Medical expenses increased by 4.4% annually; (2) Selling price of a 4-room flat rose by an average of 5.4% annually, 5-room flat by 10% and executive flat by 11.2%; (3) University tuition fees increased by 3.7% annually while junior college and secondary and primary school fees and miscellaneous fees remained unchanged; (4) Bus fares increased by 0.5% annually, MRT fares by 1.4% and taxi fares by 2.1%. Cost of living has indeed increased. But it is certainly not "no less than phenomenal" as alleged by the SDP and PKMS. More importantly, our people can still afford to purchase HDB flats and to meet their medical, educational and public transportation expenses. The Government has promised that nobody will be denied medical treatment simply because of poverty, and no children from the lower income families will be deprived of the opportunity to be educated. At the same time, the Government has guaranteed that the selling prices of 3-room and 4-room flats will be pegged to the incomes of the people. At least 70% to 90% of our people can afford to purchase a 3-room or 4-room HDB flat. Singaporeans should examine their conscience and ask themselves these questions: (1) What are the main factors causing the rise in the cost of living? Is there a choice in their consumption pattern? Must they constantly "keep up with the Joneses"? (2) Has their family income increased over the years? Is their living standard better or worse than what it was five years ago? (3) Are they aware of the Government's substantial subsidy on health care and education? Are they fully aware of the three safety nets for medical protection - Medisave, MediShield and Medifund and the various educational bursaries and assistance schemes for the poor? Apart from a lack of full understanding of the functions of the market economy, Singaporeans are worried about the rise in the cost of living because of the two following factors: (1) The perception gap - most people look at it from a micro view and personal experience. For example, when a housewife goes to the market, she feels that the basket of food costs more than last year's. When a hawker goes to the hawker centre, he finds that he has to pay more for a bowl of noodle or a plate of rice. When one chooses to buy a flat in a certain neighbourhood, he laments that he could have saved so much money had he bought it a few years ago. On the other hand, the Government uses the macro view, an average statistical data to analyse the issue. The Consumer Price Index (CPI) has risen by just 4.9% in the past three years. The non-cooked food items rose by an average of 4.7% and cooked food items increased by 7.2%. The prices of 5-room HDB flats across the country increased by an average of 10% per year. The Cost Review Committee Report can only enhance the people's understanding of the cost of living and narrow the perception gap. It is just the beginning. Members of Parliament, grassroots leaders, union leaders and the media have a lot to do to educate our people and to help them better understand the issue of cost of living. (2) The other factor that causes apprehension among our people about the rising cost of living is that some opposition parties are deliberately distorting the concepts, playing with figures and generalising isolated cases to mislead the people and stirring up their emotions. The SDP and PKMS have made some baseless allegations on this issue. For example, they say that (1) the rise in cost of living was "no less than phenomenal"; (2) that the increase in prices is the main factor contributing to the 76% increase in average household expenditures and (3) that the CPI is a result of the statistical massage of numbers. Having read the CRC Report, do the SDP members, particularly Chairman Ling How Doong, still insist that these allegations are true and correct? If so, he should present facts and figures to support these allegations. Otherwise, has he the courage to admit the mistakes and apologise to the people on behalf of the SDP for trying to mislead our people? I hope that the Government would accept the recommendations of the Cost Review Committee. I personally feel that the more important recommendations are in three areas: Firstly, the Government and its agencies should give more publicity to the three medical protection safety nets. This should alleviate the people's fear of not being able to afford medical expenses, particularly on the introduction of an opt-out system to provide MediShield cover for dependants of Medisave members. We should also encourage more old people to participate in the MediShield scheme. Secondly, the subsidy on university tuition fees should be maintained at 79%. At present, the subsidy per student per year is between $14,200 and $18,200. With the rise in recurrent expenditure, even if the subsidy rate remains unchanged, the amount of subsidy per capita must gradually go up year after year. However, we must look at this issue from another angle. University education is an investment on our human resources. The next phase of economic growth will require more university graduates. Therefore, investing in university education will not only benefit the individuals, but will also yield a high rate of social returns. Subsidy for university education is, at least, more meaningful and acceptable than subsidy for purchase of Executive Condominium. Thirdly, the reverse mortgage scheme would enable our senior citizens to enjoy the benefit of appreciation of value of their properties, and also help them to meet the needs of their post-retirement years. This concept of reverse mortgage is relatively new, and it may meet with some cultural resistance. Like the case of life insurance, old people may not accept it in the past, but now life assurance has become very popular. With our aging population, there are many old people who will have to depend on their children after their retirement. As such, they must provide for a rainy day. The Government should introduce some incentive schemes to encourage the financial institutions to launch the reverse mortgage scheme. 2.10 pm

Mr Speaker, Sir, first of all, let me join the Members who have spoken before me in commending the members of the Cost Review Committee for their thoroughness and professionalism in addressing Singaporeans' concerns on their cost of living. They have scrutinised the allegations made by the PKMS-SDP that the rise in the cost of living in Singapore was, to quote them, "no less than phenomenal" and that the CPI was the result of "statistical massage of the numbers". Sir, the Committee found these allegations to be totally false and baseless. Their conclusion has upheld the reputation of the Department of Statistics and the team of professionals working there. Sir, during the period that the Committee was meeting, quite a few constituents and grassroots leaders as well as businessmen I met at the various functions asked me what the Consumer Price Index (CPI) was all about and how it was computed. From the conversations, it was clear that they did not fully know what the CPI was all about and how it was computed. Let me therefore take this opportunity to briefly explain to Members of the House the CPI and to highlight what our real concerns should be. CPI is the Best Indicator Sir, the CPI measures the change in prices paid by households for a fixed basket of goods and services. The basket contains 3,300 items of goods and services, including items such as food, bus and MRT fares, prices of cars, haircuts, hospital charges, school and tuition fees. Every month, the Department of Statistics collects a substantial amount of data so as to compute the CPI. Take food, for example. Prices of provisions and sundry items are recorded once every two weeks. Prices of fresh food items are collected even more frequently: three times a week. This is because prices of fresh food items fluctuate more, in line with market and weather conditions. Moreover, prices are collected from a number of different markets. This means that in a single week, the Department of Statistics collects 24 price quotations for, let us say, kai lan alone. On average, 30,000 price quotations are used to compute the CPI monthly. This painstaking effort ensures that prices used in the CPI closely reflect the actual experience of consumers. The process of compiling the CPI is also transparent and well-documented. International conventions are fully observed in the calculation of the CPI. To ensure that the CPI basket remains representative of spending patterns of Singaporeans, the CPI basket is reviewed and revised every five years. This is a more demanding standard than the international guidelines of a revision every 10 years. Sir, the CPI is a comprehensive measure of price changes. Though not perfect, it is, nonetheless, the best available indicator of the cost of living. Perception Gap However, while inflation as measured by the CPI is low, as Members of the House have mentioned, some Singaporeans have complained that they feel "squeezed", that their cost of living has risen faster than indicated by the CPI. A perception gap appears to exist. Why is this so? Sir, in a way, this is not surprising. While the CPI compares "apples of 1990" with "apples of 1996", people's perception of cost of living is influenced, for example, in some cases, by comparing between "chicken rice in a hot hawker centre in 1990" and "chicken rice in the comfortable air-conditioned Junction 8 Food Court in 1996". Of course, Members have also mentioned other examples, including Mrs Yu-Foo's example of grapes with many seeds in 1990 versus the seedless grapes of today. It is true that prices have indeed risen, especially for services, but nonetheless the percentage of increase, as indicated in the Report, is only 14%. The bulk of the increase in household expenditure is due to our adopting a higher standard of living and a more comfortable lifestyle. Clearly, this is something to be congratulated, not something to complain about. The Government's responsibility is to promote economic growth so that all Singaporeans can enjoy a higher standard of living. Steady economic growth enables Singaporeans to secure good paying jobs with regular pay rises in step with their efforts and productivity improvements. In fact, the salary of Singapore workers increased by an average of 7.7% per annum over the last seven years. It is this strong growth in wages which has enabled Singaporeans to upgrade, be it in their eating habits, the goods they buy or the homes they live in. Sir, the challenge facing Singaporeans is not really the cost of living - as this is generally within the control of each and every person, whether it is for medical expenses, food, housing, the choices are there. The challenge facing all Singaporeans is how to ensure that our economy stays competitive and healthy. Otherwise, we will not be able to maintain our present standard of living, let alone improve it. The current economic slowdown is a timely reminder to all Singaporeans that our well-being and prosperity are heavily dependent on the outside world. In recent months, global demand for electronics slowed down, and we are immediately affected. Global competition is tough and will get even tougher. We are now competing with not just the developing, but also developed countries, for international markets and investments. Our resource constraints are permanent and we cannot wish them away. Our limited land and labour mean that such resources cannot be cheap. This means that we must compete on the basis of capability. How do we do this? First, by maintaining our pro-business environment, with a world-class infrastructure and an efficient public administration. Second, by upgrading our workforce and raising their productivity. This will enable our companies to continue to pay their workers better wages and yet maintain their competitiveness. To this end, the Government has provided incentives and subsidies for training. Our economic agencies will continue to help companies train and re-train workers, upgrade their technology and re-configure their business practices. But workers must also play their part, by putting in the necessary efforts to upgrade their skills and knowledge. Third, by emphasising R&D in order to develop original technology and sharpen our competitive edge. The Government has launched the Second Technology Plan to enhance our technological capability and committed $4 billion into the R&D fund. This will support and promote greater industry-relevant R&D, thus enhancing the capabilities and competitiveness of our industries. Fourth, by maintaining political stability and social cohesion. As investments grow increasingly capital-intensive, so would the premium that investors and businessmen place on peace and stability. The strong support and cooperation of Singaporeans enable the Government to formulate and implement long-term policies. Their cooperation and hard work enable investors and businesses to achieve attractive and competitive returns, thus encouraging them to expand their operations here. By continuing to work closely together, Singaporeans can ensure that we continue to attract new quality investments. This will help us gain access to the latest technologies and products, and generate high-paying jobs for our people. It will also help us to generate adequate financial resources to help low income earners. By maintaining our free market environment and a strong currency, it will ensure that inflation continues to be low. Sir, Singaporeans cannot avoid having to spend more if they want to raise their standard of living. Our aim must be to ensure that our incomes increase steadily, thereby making our aspirations realisable. The solution is to continue to upgrade our skills and our productivity so that we can command higher salaries without losing our competitiveness. Then all Singaporeans can afford the better things in life for themselves and their families. This is the successful approach this Government has taken all these years. And this is the approach we must continue to take. Sir, I support the motion.

Mr Speaker, Sir, the Cost Review Committee has produced a good report and made some useful recommendations. I am glad the Government has accepted the Report and urge that as many recommendations as possible be put into practice. Sir, the whole exercise of re-convening the CRC has provided us with some useful lessons and allow me now, Sir, to highlight some of these important lessons. 1. Institutionalization of CRC Issues like the cost of living are dear to our hearts and near to our pockets and therefore deserve our attention. I propose that the CRC be institutionalized and convened regularly. The Committee should not only be convened in response to ad hoc situations. Instead, it should function as a regular monitoring mechanism to assess the cost of living to inform the public and help the Government to take appropriate measures. The work of the Committee can complement CASE in its role as a consumer watchdog. 2. Is CPI so important? The work of the CRC has helped to bring to light important considerations on the usefulness of the CPI and just now Minister Yeo Cheow Tong has given us a further clear exposition. In essence, CPI is an aggregate index used for international comparisons. However, it may not be the best indicator to signify Singapore's cost of living since we are a country like no other in the world. We have three million urbanites living in an island with superb infrastructure. 90% of people own the homes in which they live. And 85% of homes are subsidised by the tax dollar. These are some exceptional features that make us truly different from both developing and developed nations. We need a Cost Review Report to give us relevant facts on the cost of living but we do not have to make the CPI a sacred cow. Well researched and represented facts and figures with or without an aggregate index will be adequate to give us a true picture of our cost of living. The Department of Statistics can continue to calculate the CPI according to international standards and keep it for that purpose. However, there is no need to constantly showcase an aggregate index that does not appear to square with the business of daily living. 3. Folly of jumping to conclusions The next lesson, Sir, I would like to highlight is the danger of jumping to conclusions. That may be the only exercise that some people in Singapore choose to take. However, most of us would agree on the need to be more circumspect in our judgment. We cannot necessarily conclude that prices have risen "phenomenally" just because household spending was reported to have risen by 76% during the period under consideration. We need to explore further and dig deeper to find out the real reasons for this rise in spending. Fortunately, the Report of the CRC has put matters into perspective. We understand better why there has been a 76% rise in spending. In fact, this increase attests to our phenomenal economic success as a nation. After all, we are the ninth richest country in the world with a standard of living which is second to Japan in this region. A small increase in household spending would suggest that we have yet to arrive in the "economic" sense. Also, Singapore's quick economic climb should have been accompanied by an even higher percentage of household spending but for the moderating influence of a strong Singapore dollar that curbed the price of many goods. However, Sir, the story is different when we consider the cost of services. It is only natural that the cost of services has risen given our tight labour market and high productivity. Wages have been adjusted upwards to reflect this, as mentioned by Minister Yeo Cheow Tong. In this scenario, the lesson to be drawn is that increased spending is not necessarily a bad thing if it is accompanied by appropriate wage increases and a better standard of living. It is as a result of this process that we have reached the status of a most developed developing nation. 4. The lesson on the disadvantaged The fact that increased spending has allowed many of us to purchase better quality goods and services and improve our standard of living must not blind us to the reality that some of our brothers and sisters in Singapore may be economically less fortunate than us. These people are adversely affected by the general increase in the cost of living. They should remind us that we need to increase the redistribution of wealth in the form of subsidised services for the needy, the poor and the elderly. These groups need both our support and our resources to improve their standard of living. Those of us in the labour force have enjoyed a 7.1% annual increase in wages. In most cases, this has offset and may have even exceeded the increase in prices, but this happy state of affairs does not apply to all. The less privileged have to live off shrinking assets and expectations. Urban life is based on a cash economy which sharpens the effects of poverty by making households more vulnerable to price changes. Therefore, Sir, all of us - the Government and the working population - will have to ensure that these unfortunate people are not left out as we continue to improve our standard of living. Sir, the elderly deserve special mention. They worked as hard as we do now but due to historical circumstances, many of them have little or no CPF, few savings and little Medisave. It is our moral duty to look after the elderly. We should not be afraid to subsidise them financially as it is only a short to medium-term measure that applies to the aged of today. The aged of tomorrow will be adequately provided for with their CPF, minimum balances, Medisave and MediShield. By subsidising the aged of today, we will not be institutionalizing an intergenerational burden as we have already laid the economic building blocks for the aged of tomorrow to look after themselves. Sir, we must also not forget the poor and the disabled. Most of them are disadvantaged not because they did not work hard but through sheer misfortune. With our meritocratic frame of mind, we sometimes tend to be patronising and dismissive of people who have not succeeded, especially in the economic arena. We often equate their misfortune with slothfulness and laziness. And our own success sometimes makes us smug and insensitive. These feelings of self-righteousness do not augur well for social cohesion. Therefore, the lesson that we should draw is that although most of us have benefited from the economic success of our system and can well afford the increase in the cost of living, we must be aware that this imposes an unbearable hardship on the less fortunate. We are duty bound to help them and should carry this out with humility and magnanimity. 5. Ignorance of public services Sir, this leads me to my final point. Although there are many mechanisms in place to help the less fortunate, there is general ignorance of this. In the concluding chapter of the Report of the CRC, it is mentioned no less than five times that there is little public understanding and awareness of existing measures and mechanisms to help the needy, the poor and the elderly. This is another lesson for us - in fact, it is a sad commentary on our communication strategies. Sir, are we so engrossed in formulating and fine-tuning policies that we have forgotten the art of communication? Or are our people so inundated with information on policies that they have switched off and stopped listening? We need to sit up and take note of this. But what we do not need is a campaign extolling the virtues of listening to details of policies that are announced. This will not work. Instead, we need to empathize and communicate in the real sense of the word. In concluding, Sir, I would like to state my support for the motion moved by the Member for Kampong Glam GRC. However, I would like to add that we should go all the way to ensure that the good intentions formulated at the macro level to help the elderly and the poor are realised to a greater extent at the micro level, because that is where it really matters.

Order. I suspend the sitting and will take the Chair again at 2.55 pm. Sitting accordingly suspended at 2.30 pm until 2.55 pm. Sitting resumed at 2.55 pm

Debate resumed.

Mr Speaker, Sir, thank you for giving me this opportunity to speak in support of the motion of the Member for Kampong Glam GRC. The Cost Review Committee Report covered a wide area - from food, housing, education, transport, health, the impact of the GST; and also assessed the impact on the poor and the elderly during the last 2-3 years of rapid economic growth. Sir, when the opposition, namely, the SDP and the PKMS, makes serious accusations that the rise in the cost of living has been no less phenomenal and that data in our statistical series have been massaged in order to hide the phenomenal rise in the cost of living, it is important that the Government must establish the truth, in order to separate the facts from the pervasive falsities that of late have emanated ceaselessly from the SDP. Billions of dollars of investments are involved by many research analysts and investors when they study statistical data which come out from countries. And in Singapore, I am sure tens of billions of dollars of investments are invested by MNCs and international fund managers. Such decisions are made by relying a great deal on statistical data on output, employment, prices and others. Statisticians the world over observe certain accepted standards in obtaining such data. And billions of dollars of investment decisions are made based on the forecasts or projections of such data. Policymakers from governments establish monetary and fiscal policies or central bankers weigh interest rate changes or money market operations or intervene in the foreign exchange markets in reaction to scenarios enjoined by these data. These, in turn, affect cost of borrowings for businesses and individuals, access to credit facilities, affecting investments and jobs in the economy. The US leading indicators are watched and monitored intensely, and with no lapses of memory by research analysts and statistical clerks in mutual fund bodies, pension fund institutions and central banks across the world, because billions of dollars of investments are affected by the optimism or pessimism generated by these data. Therefore, the SDP-PKMS accusations must be taken very seriously and rebutted as such. The Cost Review Committee, in one of its findings, observed that the Department of Statistics' figures show that the 76% rise in the household spending between 1987/1988 and 1992/1993 had been accounted for by a rise in prices which account for 14%. The remainder 62% is explained by other factors, such as Singaporeans buying more, better quality and more luxurious brands of goods, shifts in the profiles of households towards more middle-age household purchases, which tend to have a higher spending level. In addition, Singaporeans are also buying investment goods earlier. They want an executive flat when they have barely graduated from the university and they want a car. It would not be honest for us to say that there is no rise in the cost of living in the past few years. But that is very different from saying that the rise is phenomenal and that the statistical data have been deliberately massaged. The first answer to counter the argument on the rise in the cost of living is to remind ourselves that in this period of the last seven years wages have risen by about 7.5% per annum. The CRC reported that food prices basically showed not much increase in the last two or three years, barely 1%. But there was observed a pattern of shift to higher quality goods with the implied higher cost and value. The 76% rise in household spending between 1987/88 and 1992/93 therefore is to be interpreted as a preference for a higher standard of living, with the implicit higher cost attendant to it. In a free market economy, consumers and individuals decide what to do with their dollars. The State must be silent on this. In any society, there are bound to be certain groups who feel left behind because their income has not been able to catch up with the average. Under a situation of rapid expansion in the economy, it is quite natural for this group to be feeling the pinch. Here I am glad that the CRC Report devoted two chapters detailing the issues for the poor and the elderly and making recommendations for the Government to take action to assist them. Mr Speaker, Sir, I wish to share some real life examples of events which I have actually come across in my meet-the-people sessions during the last two or three years which I believe succinctly encapsulate the issues we are debating, to go beyond the figures and the data to illustrate the assistance that is available and the excessive demands that are made on the Government by some Singaporeans. It is important that we get to the problem in perspective, to be aware that the public funding by the Government is reasonable generally, perhaps short only in a few areas, which the Report has addressed, and that the individual Singaporean must be responsible for his own consumption or investment decisions, whether it is buying a car or an apartment. These real events were dealt with by me personally. About two years ago, a young couple in their mid-20s, both recently graduated from the local university, came to see me requesting my assistance to obtain a waiver from the HDB for the 20% deposit they needed to pay for their new HDB apartment in Mei Ling Street. They explained to me that they had just started working and it would be a few years before even they could have accumulated enough balance in their CPF (both together) to pay even for the first deposit. I asked them why they had not waited a little longer and perhaps saved more, enough to pay for the deposit, or get a HDB 3-room or 4-room apartment instead of a 5-room apartment, which costs higher. They informed me that they had actually applied for an executive apartment. They said that if they were to go for the executive apartment, it would save them the hassle and the cost of upgrading to a bigger apartment later on. I was quite surprised by the brashness of it. I told them that by their logic all those who were helping me in my meet-the-people session should be staying in private houses. At about this period, a few months earlier, a young mother staying in Tanglin Halt had come to see me about some matter. She and her husband, both originally from Indonesia and both also graduates, are settled in Singapore. They bought a 3-room flat in the resale market and stayed on with their son. Both are also working in Singapore. I asked her why she did not buy a 4-room or 5-room HDB flat since both are graduates and working. Her reply to me was that they would want to save enough first before they do so. She was very happy with her 3-room flat. Although their parents had supported them for their study overseas, not every Chinese Indonesian is rich, like those rich Indonesians. I was very impressed by this young mother. These two incidents set me thinking quite a bit. Singaporeans are in danger of over-demanding on themselves and on the Government. I believe these two incidents can cover a good part of the cost of living issues that we encounter today. Are the couple applying for the executive apartment brash or foolhardy? On reflection, I think they are not entirely wrong. They are smart. They are reacting to an environment that is uncertain and changing. A part of the problem lies with the many regulations and conditions which are being presently imposed by the HDB. If they upgrade later, they are on a longer queue. And with prices going up, they may face disadvantage. If you take a bet on an executive apartment in Queenstown on a ballot you cannot lose. I suggest HDB ought to streamline some of the regulations on the ballot, the queue and credit access. It is a very complex exercise of moving from a regulatory paradigm which HDB has been operating to a free market paradigm which HDB has been moving to in the past few years. Part of this problem is unavoidable when you have property prices going up. Sir, with your indulgence, I will tell you the second real life event. An elderly gentleman came to see me about two or three years back regarding the medical bill of his late sister which amounted to more than $45,000 incurred during her stay in the NUH during her last days. I asked why he had put his sister in an expensive class. He said that she was admitted to the NUH and had been on medical treatment till she passed away. The siblings did not expect such a long illness and it was not possible for her to change. It was also out of brotherly love for her sister, who was single, and he was quite prepared to have his Medisave deducted, and his other siblings, and part with his own savings, but that was not enough to settle the bill. I advised him against doing so for this will create problems for him later on, for he needs the money for his own medical bills. Through the Medifund he obtained full remission of fees for his late sister. When I met him recently, he reminded me of the help he had received with thanks. I have no doubt the 3Ms work - Medisave, Medifund and MediShield - and if our needy are properly guided and assisted they need not feel so fearful when they enter a hospital. I cannot agree more with the CRC Report that hospital staff should be guided to counsel admission cases to the class ward they can afford and when there are no vacancies to admit them into the next higher class temporarily at a lower class rate, and to transfer them back to the lower class ward immediately when there are vacancies. In this way, hospitals will be able to know the intended demand for the respective class wards. And if the demand always exceeds the supply in a respective class, more beds should be built for that C ward, as promised by the Prime Minister in his National Day Rally speech. The third event, Mr Speaker, Sir, happened a few months ago at a meeting I had with a group of students in my constituency. They were recipients of the CCC and the PAP Community Foundation bursary awards. One recipient, a student, asked me: why did the Government who professes to want to help the poor and needy students make the fees so high for them? The poor students, he said, have to apply for loans or bursaries. Some have to work to support their studies, thereby affecting their performance. Why can we not just subsidise a bit more, not to subsidise the poor students, but to give more chance to the poor students to do better, without having to worry and to move upwards in jobs and career and income later? Why saddle them with loans to pay before they start to work? These are questions our young students ask and rightly we owe them a good explanation. My answer to him was that compared to what the university was in my days, more than 20 years ago, where only less than 1.5% of the cohort entered university, the figure is now expanded more than 14 times. 20% of the primary school cohort now enter the university and 37% of that same primary school cohort enter the polytechnics. The cost of running this expanded tertiary education system cannot be borne by the Government, just like when only 1.5% got the benefit of a university education. Therefore, part of it will have to be borne by the direct beneficiaries of the education system. The Government is presently fixing the cap for university education subsidy at 75%. The CRC requests for 79%. May I suggest that, to make up for this 4% difference, the Government concedes 2% and the universities and polytechnics raise productivity or cut cost by another 2%. That will be a win-win situation for everybody. More, the standard and stature of our two universities have also grown so much in the period. Facilities must be comparable to world standard and the teachers must be paid the salary competitively. Most students should be able to afford the fees charged and pay their share. But we should give financial assistance to those who need help readily. We should not make it restrictive for students to get supplementary financial assistance. The fault often lies in the administrators of these scholarship or bursary awards. These administrators who do not give full value scholarships or awards should not insist in their rules for application and awards that recipients cannot get other supplementary awards, such as the community-based bursaries from self-help groups, CCCs or charitable foundations. This rule should also apply to those community-based organisations not to stipulate such rigid rules on the applicants or recipients as if their grants are so valuable. This should also apply to the Edusave bursary awards given out by the Ministry of Education. We should not deny our students access to more than one source of financial assistance. The Government has accepted the CRC Report. I hope their recommendations should be seriously looked into with a view to assisting the poor and the elderly.

Mr Speaker, Sir, let me declare at the outset that I am a member of the Cost Review Committee. Since I have been part of the process, I fully support and endorse the Report and its conclusions. I would urge the Government to seriously consider the recommendations, particularly for the poor and the elderly. Affordability of basic essential services is key to a socially cohesive Singapore. What I would like to do today is to elaborate on three themes related to the Report. The first theme is to consider the view that the reconvening of the CRC is politically motivated, that it is yet another political move made by the PAP Government in its attempt to get at the opposition. After all, the CRC is chaired by a Cabinet Minister and the Deputy Chairman is a long time PAP MP. The CRC, as this view goes, is therefore not really independent and cannot be expected to criticise the Government. Most importantly, the general election is around the corner. In my view, there is undoubtedly a political element in the reconvening of the Cost Review Committee. The issue of the rising cost of living in Singapore has once again become a hot domestic issue. SDP and PKMS have politicised this by making the claim that the rise in the cost of living has been no less than phenomenal and that there has been a statistical massage of the numbers. However, the fact that this issue has become politicised makes it no less an issue of sufficient importance. It therefore merits serious consideration with or without its politicisation. It affects the life of many Singaporeans, every Singaporean. The SDP-PKMS' allegations provided an occasion for the reconvening of the CRC. Discount the more overtly political elements, if you will, but I would urge Singaporeans not to throw the baby out along with the bath water. Many of the recommendations made by the CRC are good, sensible ones which could genuinely help in keeping costs down. The second theme is one which has been lurking beneath the surface and that is the question: to what extent is the Government to be blamed for the rise in the cost of living? I believe that the first and most important factor accounting for the rise in the cost of living in the 1990s is the booming economy. The economy grew at 8.9% per year from 1992 to 1995. With such buoyant demand and constraints in supply, wages increased by 7.1% and property prices also rose. Wage and rental costs have worked their way into the pricing of goods and services, particularly of domestic services. For example, a bowl of noodles is more expensive and has less ingredients in it now than even five years ago. Were it not for the fact that the Singapore dollar appreciated during this period, inflation would have been even higher than what it has been. Does this mean therefore that Government policy had no part to play at all in the rise in prices? I do not think so. Certain Government policies have had the effect of contributing towards an increase in demand and hence a rise in prices. For example, where HDB resale flats are concerned, the sharp rise in prices in 1993 is clearly associated with the easing of the HDB mortgage loan scheme from 80% of 1984 posted prices to 80% of market value. The reverse has also been experienced with the stricter property market regulations introduced in May this year. There is another factor. This is the Government's philosophy of pricing public sector goods and services. In essence, this could be summarised as market rates, wherever possible, with subsidies for essential services based on a sliding scale. Take, land, for example. Government land sales are now by tender in the open market. Land acquired under the Land Acquisition Act used to be compensated at historical prices which bore no relation to reality. But now compensation for land is much closer to market rates. The principle of market rate valuation plus the rise in land prices in a booming economy could be one factor while the land cost index for HDB housing rose by 24.9% per year during 1992 to 1995. This in turn was one of the two major reasons for the price increases of HDB flats during the period. In the area of essential social services, such as health, housing and education, the Government still grants subsidies but on a sliding scale. C class wards have a subsidy rate of 80%; B2 wards, 65%; B1 wards, 20% and A class, none at all. Similarly, it used to be that the subsidy rate for 3- and 4-room HDB flats was about 30% of the total development cost, while that for 5-room and Executive flats was about 10%. More recently, it was announced that there would be a price guarantee for 3- and 4-room HDB flats so that at least 90% and 70% respectively of Singaporean households would be able to pay their monthly mortgages entirely out of their CPF. Similarly, subsidies in education are nearly 100% for primary, secondary, junior college and vocational education, while it is 78% for university education. What this meant was that where subsidy rates were higher than the target levels, the reduction in the actual subsidy rates contributed towards price increases in the relevant services. This included university tuition fees that Mr Chay Wai Chuen just referred to and A and B1 hospital ward charges. It is also instructive that while the price of a 4-room Model A HDB flat increased by an average annual rate of 5.4% between 1992 and 1995, that for 5-room and Executive flats increased by 10% and 11.2%, respectively, about double that of the annual increase of 4-room Model A HDB flats. Does this mean then that the Goverment system of pricing is no good and should be changed? One must consider that the other side of the coin is that while subsidies have been reduced, so have taxes. The corporate tax rate is now 26% while the highest marginal personal income tax rate is 28%, relatively low by international standards. We do not have large budget deficits because of subsidies which are difficult to control. I believe that market rate pricing of Government services is the most efficient system available to allocate scarce resources. I also support the Goverment's policy of continued subsidies in order to make basic services affordable, particularly for the poor and the needy. Dr Soin has elaborated at length on the need for such affordability, particularly in the case where for the poor and the needy, they need these subsidies in order to make basic services affordable. However, I do not support subsidies for what can be considered more luxurious accommodation, such as Executive Condominiums. I would also urge Government agencies, statutory boards and corporatised agencies to think twice, perhaps more than twice, before increasing Government fees and charges. The multiplier effects are actually quite considerable when these fees and charges are raised. Price increases should be considered as a measure of last resort, not just to maintain profits and surpluses. The third theme is that accompanying Singapore's rapid economic growth has been equally rapid changes in norms, expectations and lifestyles. For example, 65% of first-time applicants for HDB flats opted for 5-room and Executive flats in 1995 compared to 47% in 1992. In other words, in just three years, there has been a change of 18 percentage points in terms of the numbers of first-time applicants who opted for 5-room and Executive flats. Why do norms in Singapore have to change so rapidly? If 3- or 4-room HDB flats were good enough for our parents and even for us when we were growing up, why are they no longer good enough for the present generation now? Have some of us gotten on to the treadmill of rising norms only to face the frustration of unfulfilled expectations? To summarise, the basics are still affordable in Singapore, 3- and 4-room HDB flats, primary and secondary school education, bus fares. It would be hard put to say that these are beyond the reach even of the majority of Singaporeans regardless of income levels. However, A class and private hospital health care, private property, cars, these are expensive in a thriving city state located in a booming Asian region. It is ultimately a lifestyle choice and what one can afford. Take, air travel, for example. There is really no necessity to opt for first-class or even business class. Economy class gets you to your destination in exactly the same time on the same plane. I support the motion, Sir.

Mr Speaker, Sir, cost of living is an issue close to the hearts of workers everywhere and not just here in Singapore. When prices go up, as they invariably must, workers are upset. But so long as wage increases are ahead of inflation, they should be all right. Far more important is for us in the labour movement to ensure that we maintain industrial harmony so that more investments can come in, and more and better paying jobs can be created.

3.20 pm What have we done to help workers? We have a trade union movement that cooperates with management and Government. But let me state here and now that this cooperation should not be taken for granted. Where we find evidence of employers trying to be funny, our unions will take whatever action deemed necessary. The job of trade unions is to speak up when there is injustice, not just in the narrow field of industrial relations but in the wider social context. For example, I find the stance taken by the SDP extremely dangerous. To gain popular support, the SDP is trying to work the ground on the cost of living and in doing so, by launching a systematic misinformation campaign. For example, the SDP had claimed that household expenditure had risen phenomenally between 1987/1988 and 1992/1993. It came to this conclusion not as a result of its own research but by merely citing official statistics. It is true that the average household expenditure has risen by 76%, but not all has been the result of price increases. The Department of Statistics had pointed out that only 14 percentage points could be attributed to price increases and the rest were due to our buying more and better things as our lifestyles change for the better. When the SDP research team appeared before the Cost Review Committee, its members insisted, against the weight of evidence, that the household expenditure increases were largely due to price increases. NTUC Fairprice and Emporium Holdings had effectively demolished the SDP's argument. Both major retailers reported that it was the more expensive, branded items that were selling better. The SDP alleged that there had been a statistical massage. But through some weird logic, something that defies explanation, the SDP explained that statistical massage did not mean massaging statistics. To create confusion in the people's minds, the SDP inflated the increases in HDB selling prices in order to show that there has been an alarming increase in housing. Let me refer to paragraph 22 of the CRC Report in the Executive Summary on page 4. The SDP-PKMS had alleged that HDB flat prices had risen by more than 100% between 1990 and 1994. Data from HDB showed that prices did not rise as much. The prices for 4-room Model A, 5-room and Executive flats rose by 5.4%, 10% and 11% a year respectively between 1992 and 1995. In other words, SDP's research people have got their sums wrong, either because of incompetence or through sheer malice. The HDB says that public housing remains within the means of the workers. This assurance should help counter SDP's campaign of misinformation. To undermine public confidence in the Government, the SDP tells people that Government acquires land for as little as $1. To get to the bottom of this $1 land issue, I submitted a Question for Oral Answer. I am satisfied with the answer. Government acquires land only if such land is needed for public purposes, but there are bits and pieces of land that are of little value. For example, older Singaporeans remember that in their old tenements, there used to be backlanes. What were these backlanes for? One purpose was to allow for the removal of buckets of nightsoil. If there were no backlanes, these buckets had to go through the front door. Thank goodness we now have modern sanitation and there is no more need for trafficking of nightsoil. So Government pays a token sum of $1 for such pieces of land as a backlane, and no one is put at a disadvantage. And this $1 land can hardly be used to build HDB flats. So why is the SDP thinking so low to claim that Government buys land for $1 but subsequently makes people pay thousands of dollars for HDB flats? This is another example of SDP's misinformation. Dr Chee Soon Juan has written two books to show the public at large that he is a thinking man with ideas on how to make ours a better society. But what do these books contain? Sad to say, by his own admission, they contain errors which, according to him, have come about through his careless reading of research materials. Sir, I thought of buying a copy of Dr Chee's book before coming here to show the House that the errors remain unrectified. But then I thought to myself, why waste good money on an erroneous publication. What I did was to check with my union members who work in bookshops that sell such books, and I was told that the errors are still there. On the one hand, Dr Chee says, "I am sorry. I am only human. I can also make mistakes." On the other hand, he allows the mistakes to remain in the books being sold. Where is his integrity? In the New Democrat, the SDP has repeatedly tried to agitate the people over the issue of Ministers' salaries. The SDP has misinterpreted the issue on at least two counts: by comparing what Ministers earned years ago with what they earn now, as if they would not have moved up in their careers; by giving the notional gross monthly pay of Ministers and implying that on top of all this, they also get 11 months of bonuses. This systematic misinformation is a sad reflection of opposition politics today. We want a strong democracy, but it should be based on objective assessment of issues using correct facts and figures. It should not be based on misinformation. Before I conclude, let me touch on one other matter of concern to workers. This is the medical benefits available to workers. As the CRC Report notes, Government has put in place the 3Ms - Medisave, MediShield and Medifund. In union gatherings, we have done our bit to keep workers informed of these three schemes. Of late, we have had tripartite tea sessions where such issues were discussed. While we in the unions can reach out to workers in the unionised sector, there are many workers who are not in the unions for one reason or another. I would appeal to the management of such non-unionised companies to do their part to inform workers of the 3Ms so that they are not led astray by glib-tongued politicians out to denigrate the Government. Overall, our workers have made progress. They are earning more even though they are also spending more. The question we need to ask ourselves is: are we spending on the right things? NTUC Fairprice sells many household brands at much cheaper prices than branded items. Our workers can, through prudent purchases, save more money. There is nothing wrong with going out for our food. These days when husbands and wives work, eating out has become more prevalent. But if they eat out, they must be prepared to pay more because our hawkers too need increases in income year after year. The CRC has done a good job. It has been thorough in assessing the situation. It has debunked the wild claims of the SDP. It has shown that we have an effective system of government backed by various social organisations. Lower-income workers need not despair. There are avenues for them to rise if they are prepared to go for training and retraining. There are bursaries. There are scholarship awards for children of lower-income workers. Of course, despite scholarships, expenditure of families with children in polytechnics and universities must go up. This is described in the CRC Report as the middle-age squeeze. But money spent on our children's education is an investment for a better future. The CRC Report notes that those in need of help get assistance not only from Government but also from other welfare organizations. We are a caring society. I am proud to be a member of such a society. Mr Deputy Speaker, Sir, I support the motion.

Resolved, That the proceedings on the item of business under discussion be exempted at this day's sitting from the provisions of Standing Order No. 1. - [Mr Wong Kan Seng].

Mr Deputy Speaker, Sir, three years ago, we debated this issue in this House. Today, we are debating it again. One thing I am sure - this will not be the last time. As long as we live in this world, reward comes only from effort. We have to work for anything and everything that we want. Some things come easier than others, but the most desirable things require much more effort. And not everyone attains them. This was the lesson which my parents and my teachers taught me. In life, there will be many occasions when we feel that we have to work very, very hard to get by. There will be many occasions when we cannot get what we want in spite of our best efforts. Therefore, from time to time, many will be dissatisfied about the cost of living. So from time to time, this will be debated also in this House. One key question which has emerged in this current debate is: how should the debate be joined? Do we want the debate to be based on facts and figures? More than that, do we want the debate to be based on the full facts, on as complete a set of information as possible? Or do we want to descend to gutter politics and allow political aspirants to misinform? In 1992, when we set up the Cost Review Committee comprising a cross-section of people from all walks of life, we invited the opposition parties which have MPs in Parliament to join the Committee. The Singapore Democratic Party declined. We proceeded with one opposition party, the Workers' Party, represented in the Committee. When we reconvened the Committee again this year, the SDP made great play about how serious they were in wanting to participate and to get to the bottom of things, but they twisted and turned and, eventually, chickened out. Mr Ling How Doong said that he did not have the time. Incredulous! His party says that the cost of living is a big issue, but he has no time for it! And today, he is not present in the House even. The SDP-PKMS panel was nevertheless called to meet the Cost Review Committee, to discuss their submission. The sorry exchange on 6th August speaks for itself. Notwithstanding that, the Cost Review Committee proceeded to examine various issues. And notwithstanding the volumes of information given out and extensively reported in all our newspapers, on television and on radio, the SDP continues to purvey misinformation. We have seen, as Mr John De Payva said, in the proceedings of the Select Committee on Health Care Subsidy how the SDP had repeatedly misinformed the public. The phrase "typographical error" has already claimed its place in the annals of political debate in Singapore. Mr John De Payva mentioned about the price of HDB flats and how the SDP-PKMS panel had inflated the figures, and he asked the question whether this was out of inability to look at the figures or was there some other intent. In case Members may not be too clear as to how they had inflated it, basically, it is quite straightforward. They took the prices of 4-room new generation flats for the base year and then used the subsequent prices of 4-room Model A HDB flats, and they used, not the base price, but the average price. And that was how they had inflated the rate of increase of HDB flat prices over those few years. One can only surmise why it was done this way, because they were not able to understand the figures or because of malice. This I leave to you to form your opinions. Then in the SDP's New Democrat, they claimed that the Government is collecting a lot of money from the foreign workers levy in the construction industry and said that there are 300,000 workers. There are no 300,000 workers in the construction industry. There are 29,000, which is less than one-tenth of what the SDP claimed. They also reproduced the cost of secondary school and junior college education over a few years. Without comment, they produced the charts and from the charts, you will know that the cost of secondary school education and junior college education has risen over the years by several thousand dollars per year per child, and increasing over time. The impression of such a publication without comment is to convey the impression that parents are paying more for sending their children to secondary school or to junior college. But the truth is that the fees have not been changed for the last few years. So the parents continue to pay a nominal sum, not the thousands of dollars which the New Democrat tries to purvey. These are examples in one issue of the New Democrat. Mr John De Payva has mentioned something else, that of Ministers' pay. All these are clear examples of misinformation. The SDP continues to sell the New Democrat freely in Singapore. Mr John De Payva asked a question: why is it that publications which contain errors and misinformation are still being allowed to be sold in Singapore? In case anybody in Singapore or anywhere else in the world thinks there is no freedom of expression in Singapore, why is this still continuing in Singapore? I think Mr Low Thia Khiang had learnt from the previous sitting of the Cost Review Committee and he knows how difficult it is to argue against the full facts and therefore also declined to participate in the Committee this time. He probably prefers the more comfortable position of asking questions rather than to be involved in getting to the root of the issues. Again, today, of course, he has taken the opportunity to ask some questions. He tries to imply that the Cost Review Committee's explanation about people buying better goods and employing maids as blaming the people for the rise in the cost of living. I think this is unfair and my colleague, Dr Ow Chin Hock, had rightfully rebutted the point immediately. We in the Committee had been trying to establish what had caused the increase in spending and to explain to the people who do not understand why the expenditures have gone up. We are not blaming anybody. We are not blaming the public for the rise in the cost of living. I think it is a pity that Mr Low did not participate in the Committee, because he would have learnt a lot more in this second session of the Cost Review Committee. If he wishes to continue to play a constructive role in political debate in Singapore, he would have gained a better understanding of the issues at hand. I dare say that he would have learnt a few lessons in economics. He would also have learnt what are the factors underpinning Singapore's growth over the years. He missed the opportunity. After 10 meetings spanning over 50 hours, the Cost Review Committee's conclusions and recommendations are contained in the Report. Our findings are there. Members have referred to them and commented on them and I would not repeat. But the Report accounts for why people feel that the cost of living has risen even sharply. This feeling is fueled particularly by the rise of high profile items - housing, health care and certain domestic services. These high profile items mask the general rise in the standard of living. On housing, the CRC found that HDB selling prices are still affordable. More people are buying bigger flats, which means that purchasing power has, in fact, risen because wages have risen. At a public hearing, the HDB reaffirmed that HDB flats will be kept affordable. The resale market prices of HDB flats, however, had gone up. We found that it was not due to HDB raising prices and so pushing up prices on the resale market. Instead, it was due to other factors, such as infrastructure improvements or the Main Upgrading Programme. The major factor in the past few years, however, has been "easy credit". The HDB had liberalised, usually in response to public requests, including requests from Members of Parliament, but each time credit was eased, the resale prices went up! Liberalisation caused an increase in demand, but without a similar increase in supply, the prices rose. It is a demonstration of the fundamental law of economics! In the Report on page 69, Chart 4-2, this is clearly shown. This easy credit, coupled with what Dr Lee Tsao Yuan described earlier about the booming economy and the rise in incomes, has made the cost of housing the way they were in the last few years. As the HDB resale prices rose, some cashed in, and used the capital gains to buy private property. Some cashed in and bought, again from the HDB, and pocketed the cash. Others used it to upgrade to private property. This, plus easy credit again, led to the rise in private property prices. As some people made quick money on the property market, more people jumped in. In such a situation, if credit is not tightened, then the only other lever to pull is supply. For quite some time the Ministry of National Development regularly announced that supply was coming and that it would be increased if there was demand. But there is a time-lag between announcement of supply and actual supply coming on to the market. Finally, the lever which had an immediate impact, the tightening of credit, was pulled. This was the 14th May measures. Clearly, they are effective because demand has shrunk. We should be careful in future when controlling the levers on credit. You loosen the controls too much, the prices will rise sharply. You tighten the controls too much, there will be a crash in prices. So whoever is controlling the lever has got to move very cautiously and carefully. As you can see from the information provided in the Committee's Report, it is not HDB raising prices or the tender system, which has caused housing prices to shoot up. It was easy credit. The Cost Review Committee has urged Singaporeans to be prudent in their spending. A house is a desirable item, but one should spend within one's means. We should not assume that housing prices are on a one-way upward escalator. It is a roller-coaster as well. There was a crash in housing prices in the 1970s. I was one of those caught in it. There was another crash in the 1980s. These experiences should teach us to be prudent and to beware the trap of easy credit. Each time I see or hear a bank advertising easy credit, I wonder why there is not a law against it. The other sensitive cost item is hospital expenses. The basic reasons for the rise in medical expenses are wage costs, advance in medical knowledge, and a shift to higher class wards, or to private hospitals. The Government has anticipated this rise, and has therefore devised the Medisave, MediShield and Medifund schemes. Unfortunately, there is a general lack of understanding by the people, so people worry more than they need to. More so, when procedures in hospitals give the impression that money comes first. People do not understand various Government policies. This is a point which Dr Soin mentioned. Is it due to the loss of the art of communication or is it due to people not listening? I do not know the true reasons, but I know that when it comes to medical treatment, people will not bother with MediShield or Medifund until they go to hospital and find that there are high bills to pay. It is only then that they will try to find out how the expenses can be met. Having said that, I think it is true today that we have many policies which are for the benefit of the people which are complex and even, if I may say so, Members of Parliament will find difficulty to explain. So it is useful for us from time to time to review our policies. I say that a simple solution usually covers 90% of the problem. To try to cover the next 10% is difficult. In fact, you have to weave a very complex policy to cover the next 5% and you cannot cover the balance of 5% anyway. Perhaps we should consider implementing policies which are simpler which people can easily understand and be satisfied with 90% of the result. For the working class, whose monthly budgets are tighter, it is the everyday type of expenses which cause them concern. They will remember prices of domestic services, such as how much a plate of chao guo tiao used to cost. Or how much it used to cost to get their hair done. But these are wage driven increases. The prices of such services will follow general wage increases, a point which Singaporeans will have to learn and understand. We have to understand that our hawker food business is labour intensive. So long as the methods of serving hawker food remain the same, hawker food price increases will keep pace with wage increases. The more successful our economy, and the higher our wage levels rise, the higher will be the price of hawker food. Unless there is a restructuring of the hawker food business, a change from the labour-intensive methods currently employed, very soon our hawker food will cost more than the Western import, hamburgers. I am glad to say that restructuring of the hawker food business has been going on, though a bit slowly, over the last few years. These, in simple terms, are some of the main findings that explain why people feel that the cost of living has gone up. But our investigations reveal much more: that we have a system in place which motivates people to perform, which raises their productivity so that they can earn more, and so enjoy a better life, and at the same time there are safety nets for those who do not make it. Our CPF savings system allows the vast majority of our people to own their own homes, so that accommodation is not a consumption item. Instead, their homes are their assets. If they purchase homes within their means, they are much better off as compared with people who rent, should there be a disruption in their incomes. We take the 90% home ownership in Singapore for granted. We aspire to the Swiss standard of living. Home ownership in Switzerland is only 60%. So a person who rents in Switzerland and who unfortunately is retrenched in a recession has got to worry about the rent. In Singapore, if people use the CPF system and buy the right type of flats, they need not worry about the rent. Our wage system has a bonus system, and this has helped most families, including the lower income families, to buy consumer durables that are usually found in typical middle class households. And as I have mentioned earlier, and so have several Members, we have got the Medisave, MediShield and Medifund schemes for our health care needs. All these schemes provide Singaporeans with the means to a better life and with safety nets. The basic philosophy of governing Singapore is: provide a good quality of basic services, let those who want better work, to pay for it, but provide a safety net for those who do not make it on their own. And this philosophy has helped us to preserve our work ethic. It is a political philosophy which explains why Singapore succeeds. This is why most Singaporeans have seen their lives improve. But that is not to say that there are no poor people in Singapore. The Committee studied this extensively, and noted that there are about 7,000 households deserving of help. A significant number are the elderly. There is a range of assistance programmes. The poor are assisted, and the sums given to them by Government and voluntary welfare organisations are substantial and growing. But, again, there is a basic philosophy: Government assistance is the last resort, after help is first sought from the family, Government's help is kept at a minimum and the community chips in the rest. Perhaps, this comes across as being harsh and hard. But it is one way of ensuring that the work ethic in Singapore is maintained. It is quite natural for most people, when discussing the cost of living, to turn attention to the poor. Our Committee has done the same. However, the plight of the poor is not so much a cost of living problem, but a social problem which is there, whether the cost of living is high or low. Each time, the cost of living goes up, the people's attention turns to the poor. But it is a problem which exists all the time and deserves our constant attention. The Cost Review Committee has explained the reasons why people are spending more, why people feel the pressures of the cost of living, and it is satisfied that things are generally under control. It has found the systems we have in place to be sound and help people improve their standard of living. But costs will continue to rise. The Committee has recommended measures to moderate such increases. Today, in this debate, several Members have made other suggestions and recommendations. And I urge my colleagues in the Cabinet to take these suggestions seriously and implement them wherever they are feasible. But the greater task, as my colleague, Mr Yeo Cheow Tong, earlier mentioned, is how do we ensure Singapore's future growth. Wage increases will only be possible when there is growth. The task is to ensure that incomes rise faster than price increases. Only then will there be better standards of living. So our focus should really be on how to ensure our growth and raise our productivity. I hope we will not have to spend inordinate amounts of time trying to establish the truth on the cost of living. I hope we can spend more time on the development of the economy and on the development of the social aspects of life in Singapore. For me personally, this second session of the Cost Review Committee has taken the better part of my time in the last four months. I would have preferred spending the time dealing with competitiveness, productivity improvement and skills upgrading because these would ensure our workers' future. I know the members of the Committee feel the same way. Sir, on Dr Soin's proposal to have periodic reconvening of the Cost Review Committee, I am not sure that it will be a popular suggestion as far as the members are concerned. But I am happy to say that the members have given of their time to serve the public interest. Staff of the various Ministries, the universities and some private organisations have also contributed their time and appeared before our Committee. Mr Deputy Speaker, Sir, I wish to thank them all for their contributions and I would like to ask this House to thank them as well. [Applause.]

( In Mandarin): Mr Deputy Speaker, Sir, I support the motion standing in the name of Mr Loh Meng See and Mrs Yu-Foo Yee Shoon. I hope that while endorsing the recommendations of the Cost Review Committee, we would also accept its recommendations to control the rise in the cost of living and to help the poor and the aged people. I agree with the Department of Statistics that while the average household expenditure of Singaporeans rose by 76% between 1987 and 1993, only 14 percentage points were the result of higher prices or inflation. Therefore, to a very large extent, the rise in cost of living was due to other factors, mainly because Singaporeans are now moving towards the pursuit of "better but more expensive" lifestyles. With the continuous increase in the average annual income of our people, their pattern of consumption has become more demanding. Moreover, nowadays bank loans and other forms of credit facilities are easily available. Advertisements in the newspapers and over the television make the goods and services look so tempting and attractive. This has resulted in big changes in the consumption habits and patterns of our people. Mr Deputy Speaker, Sir, if a country is ruled by a good government and hence enjoys good economic growth, it will become prosperous and its people will live a life of plenty. As such, they will want to buy better goods, wear better clothes and use better appliances to satisfy themselves and members of their families. It is quite natural and normal. However, from statistics, I have discovered that within a short period of six years, household expenditure has increased by 76%, but only 14 percentage points were due to price increases. These 14 percentage points can easily be offset by the higher earnings of our people. Yet, we cannot neglect the fact that our household expenditure has risen substantially. I feel that as Members of Parliament, whether from the ruling party or the opposition party, we have the duty to look squarely at this substantial rise in our cost of living. We should not merely try to find fault with the Government, confounding right and wrong, or running away from the problem. This is a very irresponsible behaviour. I believe that the key to this problem is on the consumption behaviour and pattern of our people. Therefore, we have the duty to educate our people and change their unhealthy consumption behaviour and pattern, in order to check the rise in our cost of living. Let me give a few true-life experiences to illustrate my points: Consumption Behaviour More expensive does not necessarily mean better products. I have a friend who sells ladies' handbags in a shopping centre in Orchard Road. Initially, he priced his handbags at $20 each. But a lot of customers asked a lot of questions. They were sceptical about the quality of the handbags, saying that they were so cheap and hence could not be good. As a result, these handbags were not saleable. Subsequently, this friend of mine relentlessly jacked up the price of these handbags and sold them at $80 a piece. Suddenly, his shop became the most patronized in the shopping centre. His handbags were selling like hot cakes, and no customer complained that the handbags were no good or doubted whether they were durable or not. Naturally, my businessman friend made a fortune out of it. Prices went up by 300%, and this was indirectly caused by inappropriate consumption behaviour. I discover that Singaporeans have the mentality of "what you buy, I must buy too". For example, during the pre-Chinese New Year period, the giant prawns and the travella ("white belly fish") can be sold at prices between $20 and $40 per kilogram, and there is always a long queue for them. This is because everybody feels that if you buy, I must buy also, no matter how expensive they are! Once the festive season is over, the same giant prawns and travella can be bought at just a few dollars per kilogram. It is just a difference of one or two weeks and there is a vast difference in prices. By such consumption behaviour, you are just forcing your money into the pockets of the fishmongers, indirectly causing a momentary price increase. We should not buy unnecessary things just because there is a sale or "special offer". Some people feel that things are cheaper during a sale, and they simply buy up a lot of cheap T-shirts, shoes, handbags, etc. But, in fact, they have already had lots and lots of these things at home. Just because there is a special offer, people are seen buying drinks and canned food by the cartons. These food items are perishable. Even in canned form, they have a certain storage life, and after some time they become unfit for consumption. Buying large quantities of such items will eventually lead to wastage of money. Such consumption behaviour will virtually lead to higher household expenditure. Avoid buying branded goods. If you buy branded goods, you are paying for the brand and not so much the product itself. Nowadays, most of our children know what are the famous brands. Very often, parents would buy these branded products for their children out of love for them. By so doing, they are invariably cultivating the children's habit of high spending, and leading to higher household expenditure. I think CASE should take upon itself to educate the consumers on the proper consumption behaviour. Consumption Pattern The people of Singapore should realize the fact that Singapore is a small country with no natural resources, and we should accordingly adjust our consumption pattern to check the rise in our cost of living. In Singapore, whatever we eat, wear or use are all imported. Any variation in the supply situation will bring about fluctuation in the prices. For example, last year, when durian was in short supply, the fruit was sold for as high as $5 a kilogram. This year, there was a bumper harvest, and supply was so plentiful that we could buy durian for as low as 50 cents a kilogram or even at 50 cents per fruit. So, when the harvest for apples or oranges in the foreign countries is poor, and the imported fruits are expensive, we should tell our people accordingly and encourage them to eat more local fruits, such as water melon, papaya and banana which are equally nutritious. At the same time, it will lighten our burden on household expenditure. In this aspect, I hope that CASE will be able to provide more guidance to the consumers. Spend within our means. I notice that in recent years, the hongbao for wedding dinner is getting bigger and bigger. In the good old days, if you gave $20, it was considered very good, but now it has risen to $60, $80 and even $100. For those wedding dinners held in the major hotels, usually the host will make a lot of money out of these hongbaos. Nowadays, when young people get married, they want to hold their wedding receptions at the hotels. The bigger the hotel, the bigger the hongbao will be. For those who are wealthy, they can well afford to give a big hongbao, but for those who are less well-to-do, they will also have to cough out a big hongbao to "save face". This is another expenditure that jacks up our household expenses. Some Singaporeans whose incomes and savings are enough to support the purchase of a 4-room flat and live comfortably are not contented with it. They force themselves to buy a bigger and more expensive 5-room flat, resulting in expenditure beyond their means, and they have to tighten their belts just to make ends meet. Even members of the family have to suffer for that. Some say this is a form of investment, but as Minister Lim Boon Heng said just now, when you invest in property, it is not necessarily a hundred per cent win situation. Sometimes, you make a profit, sometimes you lose your fortune. Like in the 1980s, there was a property slump and many people lost a lot of money. That is a good example. Other expenditure such as the buying of motorcars and the type of ward in the hospital, we should also spend within our means. Mr Deputy Speaker, Sir, Mr Low Thia Khiang said just now that in Singapore, Mercedes Benzes are selling very well, but these are very expensive goods. Usually, the manufacturers and the agents target at the rich people when they advertise. I do not think an ordinary citizen could afford a Mercedes. Our country belongs to all of us. Whether you are in the ruling party or the opposition party, you have to look at the matter in a responsible manner. We have to put in a joint effort to change the consumption behaviour and patterns of our people. We should not distort the facts like what the SDP and PKMS did to mislead the people. I think what they are doing has undermined the reputation of the Department of Statistics as well as the reputation of Singapore. Now, at this important debate, Members of the SDP are not present. They are not responsible. Only irresponsible politicians would use such a means to attain their political purpose. Sir, I am very happy that the Government would accept the recommendations to help the poor and the aged. I am also very glad that the Prime Minister has also urged upon the various departments to look at the recommendations. Sir, I support the motion.

( In Mandarin): Mr Deputy Speaker, Sir, the Cost Review Committee Report is a very comprehensive report, with far-reaching effects. Singaporeans have been very concerned about the rising cost of living in recent years. The success of our housing programme is well known throughout the world, and our Housing and Development Board has been receiving delegation after delegation from countries all over the world. We all know that the facilities in our HDB estates are excellent, and the living environment is pleasant. However, the escalating prices of HDB flats have given rise to concern. The Cost Review Committee Report has given an in-depth analysis of the problem. On page 58, paragraphs 5 and 6 of the Report, it is stated that although the prices have increased, with the rise in the incomes of our people, the flats are still affordable. For example, between 1992 and 1995, the price of a 4-room Model A flat has increased by 5.4%, that of a 5-room flat by 10%, and the Executive flat by 11%. On the other hand, the average wages of a worker have increased by 7.1%. Some people feel that the price increase of HDB flats is substantial. I believe there are a number of reasons for this. First, on page 58, Table 4.1 of the Report, between 1994 and 1995, the price of a 4-room Model A flat increased by about 10%, a 5-room flat by 18.8% and the Executive apartment by 18.9%. From 1991, the selling price of a 4-room flat increased from $88,000 to $120,000; a 5-room flat from $114,000 to $190,000, an Executive apartment from $168,800 to $309,800. The main reason for this increase was that in 1991, after the Gulf War, the property market in Singapore began to take off and land prices escalated rapidly. As a result, all property prices went up. The other reason was that the figures in this Report are taken from non-mature new town prices. While in the other mature estates, the 5-room flats and Executive apartments are selling at much higher prices. For example, last year in Ang Mo Kio, the HDB price for a 5-room flat was $268,000, and that for an Executive apartment was more than $300,000. Another reason was the re-sale of old HDB flats in the open market. A 5-room flat could be sold for as much as half a million dollars. An Executive apartment in Bishan could be sold for more than $700,000. These prices would have given the public an impression that all the HDB flats have reached such a price level. In fact, these were partly due to extensive renovations which had enhanced their values. During the first half of this year, the restraints on the property market of the Government have yielded positive results, and the prices are more stabilised. However, many people are concerned that prices may go higher in future and some could not afford to wait in the long queue for a flat to be allocated. So I support the recommendation of the Committee, in urging the Government to maintain its level of subsidy for the 5-room HDB flats. I urge the Government to build 5-room flats in mature estates. For example, I hope that the vacant land near the Ang Mo Kio Library can be developed for the construction of 5-room flats. If this plot of land is to be handed over to URA for tender by private developers, it would be used for building a private condominium. Many residents in this estate, including the grassroots leaders, will only be able to admire it at a distance, with a tinge of envy. Our long-term target is to have private property making up 25% of the total residential property in Singapore by the year 2010. I think we should re-examine the time-frame for achieving this target. Most residents of HDB flats would need to have more space when their children grow up, especially those families with daughters where additional rooms are a necessity rather than a luxury. I hope that the relevant authority would seriously look into the feasibility of building more 5-room flats. If the prices of HDB flats can be increased gradually rather than drastically, I believe young couples will not rush into purchasing bigger units. They can work for a few years, wait for their incomes to rise before applying to upgrade to bigger flats. Just now, Mr Low Thia Khiang mentioned that Singaporeans were struggling with a heavy burden in life, so how could they be bothered with the building up of a more gracious society. I think this is a lopsided view. He has neglected the fact that many community organisations, Government departments, community centres and schools have put in a considerable effort to promote cultural, educational and recreational activities in Singapore. A heavy burden in life is a common phenomenon in any urbanized society, and high consumption is not peculiar to Singapore. All successful urbanized societies, such as Hong Kong, Taipei and the major cities in some countries in South East Asia are facing similar problems. So this is not a problem that is found only in Singapore. This is a common phenomenon in societies with rising incomes and affluence. To say that the Government is blaming the people for indulging in costly lifestyles and contributing to the rise in the cost of living, is a lopsided and misleading argument. I agree with Dr Lee Tsao Yuan that Government should exercise more care before increasing levies and charges. For example, the fees for a restricted passport for travel to West Malaysia have been increased from $10 to $40. This margin of increase appears to be on the high side. Recently, some people have topped up their CPF accounts with cash in order to purchase Telecom shares. Some self-employed people, such as taxi drivers, who are above the age of 55 were not happy with the CPF Board over the issue of withdrawal. A 67-year old taxi driver complained to me that after selling the Telecom shares to earn some profits, he was told by a CPF Board officer that he could only withdraw the profit from the sale, but the cash portion amounting to $1,250, which he had deposited with the Board to top-up his account, could not be withdrawn until three years later. When he told the officer that he was already 67 years old and might not survive another three years to get his money back, the officer told him that even if he was 100 years old, he would still have to wait for three years. I feel that we should reconsider this policy, especially for those who are above 60. Do they need to wait for three years before they can withdraw the amount which they had actually topped up with cash? I hope that the Minister for Labour would consider this matter. Our policies have been drawn up with the long term interest and welfare of the people in mind. But for those who are facing financial difficulty at present, we should try our best to help them.

Mr Deputy Speaker, Sir, I would like to make a clarification. My colleague told me that he heard me saying that when I referred to the SDP New Democrat which claimed that there are 300,000 foreign workers in HDB construction sites, I mentioned that there are 29,000 foreign workers in the construction industry. The SDP did claim that there are 300,000 foreign workers in HDB construction sites in their report. But the total number of both foreign and local workers on HDB sites is only 29,000. Therefore, the SDP had inflated the figure by more than 10 times.

Mr Loh, do you want to wind up the debate?

Mr Deputy Speaker, Sir, I would like to thank all Members who have spoken on this motion. There are a few points I would like to make before I round up, Sir. One is the noticeable absence of the SDP MPs this afternoon. Most probably they are having their dispute sorted out in another chamber! The second point I want to make with regard to cost and money is that we should be grateful in Singapore that money does not bring us very far. We subscribe to the principle of meritocracy and Singaporeans have every opportunity to achieve position and rewards. In Singapore it is not money that you can buy success. I am quite surprised with the logic that Mr Low Thia Khiang made just now and he is confused with the matter of cost and effect. He suggested that the Government wanted the women to go out and work because of the very high cost of living. The position is this: it is a choice for the women if they want to go out to work and it is a choice for them if they want to make to stay at home. The two matters are quite different. It is not because of the high cost of living that has compelled them to go out to work. The point I want to make is that we all have a choice to make. We can live within our means and we have to live within the income that we have. I am particularly pleased with the comments made by the three Nominated MPs. They have been objective and independent in expressing their views. It is important that they do not belong to any political party and the statements that they have made give credence to the work of the CRC, and we should be grateful to them for that. Resolved, That this House endorses the conclusions of the Cost Review Committee contained in Misc 4 of 1996, and calls on the Government to accept the recommendations to contain rises in the cost of living and to assist the poor and the elderly.

Resolved, "That Parliament do now adjourn to a date to be fixed." - [Mr Wong Kan Seng]. Adjourned accordingly at Twenty-Six Minutes to Five o'clock pm.