Hansard, 1999-08-04

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: NameFromTo (1999)(1999) M R Ravindran 4 Aug4 Aug Mr Lee Kuan Yew 4 Aug4 Aug Mr K Shanmugam 4 Aug4 Aug Assoc Prof Chin Tet Yung 28 Aug28 Aug TAN SOO KHOON Speaker Parliament of Singapore

asked the Minister for Home Affairs what are the reasons for the traffic jams recently experienced at the Causeway after the opening of the new Woodlands Checkpoint.

asked the Minister for Home Affairs (a) what are the main contributing factors to the current traffic jams at the Johor Causeway and whether any long-term solutions to the problem are being taken; and (b) whether statistics are available on the number of work permit holders among the total number of commuters travelling across the Causeway daily.

asked the Minister for Home Affairs what are the reasons for the traffic congestion at the Causeway.

asked the Minister for Home Affairs (a) what caused the recent traffic jams at the Causeway and how this can be avoided in the future; (b) what is the possibility of both the Singapore and Malaysian authorities stepping up cooperation to avoid similar problems at their respective entry and exit points; and (c) whether his Ministry will consider the proposal to use a special pass for lorry drivers and smart card for motorcyclists so that they can clear immigration checks quickly.

asked the Minister for Home Affairs what causes the severe traffic congestion at the Causeway and Woodlands Checkpoint especially during peak hours and what measures have been taken to solve the problem.

Peng Kee) (for the Minister for Home Affairs): Sir, may I take questions 1 to 5 together as they are related?

Yes.

Sir, the morning traffic at the Causeway has always been extremely busy. In the past, because our immigration officers were not able to conduct complete checks, illegal immigrants were able to slip into Singapore, especially during peak hours. In the first half of 1999, more than 70% of the 5,500 illegal immigrants arrested came through the old Woodlands Checkpoint. It is, therefore, necessary to conduct stricter immigration checks at all times. When the new Woodlands Checkpoint opened on 18th July this year, Singapore Immigration and Registration (SIR) started stricter checks. Sir, to prepare travellers for the new Woodlands Checkpoint, SIR conducted trial runs over a few days for arriving and departing travellers during the peak-periods. In addition to media publicity, pamphlets in the four official languages were given to all travellers at the old Woodlands Checkpoint. There are three incoming lanes into Singapore and three outgoing lanes to Johor on the Causeway. On the first few mornings, there was heavy congestion as vehicles were unable to get into the correct lanes after leaving the Johor checkpoint. In particular, huge numbers of motorcyclists jostled for space among cars, buses and lorries. Lorry traffic was also heavy as usual. At the Checkpoint, stricter immigration checks were carried out on travellers, taking about 30 to 45 seconds each. Customs takes about two to three minutes to clear each lorry. There is a red and green lane system for customs clearance for all travellers, including lorries. To relieve the congestion, SIR and Traffic Police deployed more officers to direct traffic on the Causeway. One Johor-bound lane was converted into a Singapore-bound lane, making a total of four incoming lanes to Singapore and two outgoing lanes to Johor. More clearance counters were opened. Sir, what is the current situation? After the first week, school and factory buses are now generally cleared by 7.00 am, which is better than before; cars are moving steadily, also better than before; and the motorcycle queue has eased off earlier, at about 8.00 am instead of 9.00 am at the old checkpoint. The lorry queue remains the same as before. The clearance of buses, cars and motorcycles and lorries is now normal. The situation has stabilised. On the departure side, there is a marked improvement in the traffic situation. Traffic used to stretch right up to the BKE during the evening peak-hour. It is now confined to near the checkpoint boundaries. SIR is looking into ways to further improve the clearance rate at the Checkpoint. There is a smart card clearance system at the bus halls. More regular commuters have applied for these smart cards and will be encouraged to do so. There is also a pilot study to clear motorcyclists through the smart card system. There is already a special pass for lorry drivers who make 20 or more trips a month. These Multiple Journey Visit Passes (MJVPs) may be given to more lorry drivers. Sir, the congestion during the first few days of operation is unlikely to be repeated. As regards Mr Hawazi's question on both sides stepping up cooperation, there are already links between SIR and Customs, and their Malaysian counterparts.

Sir, may I ask the Minister of State to clarify what is meant by "stricter immigration checks"? Is this primarily to control the number of illegal immigrants trying to enter Singapore?

Sir, the Member is correct. As I said, for the first half of this year, out of the 5,500 illegal immigrants who were arrested, 70% or almost 3,800 said that they came through the Woodlands Checkpoint. One reason could be because of the large number of motorcyclists involved. What they did in the past was to flash their travel documents, and only about 12-13% would be checked. So the rest would just flash through. Because of the constraints at the old Checkpoint, we could not check everybody. So this is one gap which we feel we have to plug. And so with the new Woodlands Checkpoint, all the motorcyclists and all the other travellers are checked. Their travel documents are given to the customs officers who will look at the photographs and check the particulars against the persons.

Sir, the Tuas Second Link is now under utilised. Would the Government consider working with the Malaysian government in a scheme to popularise its use, so as to ease the congestion at the Woodlands Checkpoint?

Sir, the means of regulating the use of the Causeway and the Second Link are by means of the tolls. And as the Member knows, toll amounts are not just derived at from one side. They are derived from both sides, taking into consideration what each side is paying for the tolls. This is something that cannot just be unilaterally changed by ourselves. In terms of regulating traffic flow, this really comes under the Ministry of Communications and Information Technology (MCIT). It is something that MCIT can consider. Like I said, it is not just a matter of simply raising tolls to regulate traffic. I think what we have to do is that we have to recognise that the main bulk of traffic will still come through the Woodlands Checkpoint. Like I have said, there were, of course, initial teething problems. But arising from the various measures that have been taken, these problems have been largely solved, and the situation has stabilised.

Sir, I have noticed that in the old Woodlands Checkpoint, many of the immigration booths were not opened during peak hours. I do not know whether the Minister has given instructions for all the booths in the new Checkpoint to be opened, especially during the crowded periods.

Sir, like I have said, one of the measures taken to ameliorate the situation arising in the first few days was the opening of more counters. For example, as a quick check, in the old Woodlands Checkpoint, for motorcycles and cars, there were 24 counters. Now, there are 53 counters for motorcycles and cars in the new Woodlands Checkpoint. This is more than double. For buses, at the old Woodlands Checkpoint, there were 10 counters, and now there are 26 counters, including the conversion of some departure counters into arrival counters. Not only has SIR converted one departure lane into an arrival lane so that there is better flow, but for the bus commuters, six of the counters, I understand, have also been so converted to accommodate a faster flow. And lorry counters have been raised from four in the old Woodlands Checkpoint to six. Sir, I take Mr Chiam's point that more counters should and indeed have been opened. I think the basic point is that what can be done have been looked at and have been done. But, of course, like I have said, SIR together with the other agencies is still looking at ways to improve the situation, eg, getting more of the commuters, particularly the bus commuters, to go into the immigration access card system. I understand that since the new Woodlands Checkpoint opened, about 4,000 new cards have been issued. So the situation should further improve.

asked the Minister for Home Affairs whether there has been an increase in the number of attempted smuggling of illegal immigrants into Singapore detected at the Woodlands Checkpoint; and what measures have been taken to check this problem.

Affairs): Mr Speaker, Sir, more cases involving the smuggling of illegal immigrants into Singapore have been detected at the Woodlands Checkpoint this year. For the first half of 1999, 10 traffickers and 51 illegal immigrants were arrested, as compared to only one trafficker and two illegal immigrants arrested in the corresponding period last year. In the whole of last year, 61 foreigners were arrested at the Woodlands Checkpoint for attempting to enter Singapore illegally. Sir, indeed the numbers have gone up. Last year, more than 14,700 illegal immigrants were caught in Singapore. SIR estimates that about 70% of them came through the Woodlands Checkpoint. This illustrates that illegal entry into Singapore through the Woodlands Checkpoint is indeed a serious problem. SIR has thus taken a range of measures to check the problem at the Woodlands Checkpoint. What are some of these measures? First, like I have mentioned just now, more intensive checks. SIR has, since the later half of 1998, intensified checks at the checkpoint. From July 1998 to June this year, 19 vehicles were seized and forfeited, as compared to only five vehicles in the 12-month period preceding that. With the recent opening of the New Woodlands Checkpoint, SIR has also started conducting more complete checks on travellers and vehicles. Second, enhanced intelligence capability. SIR has also enhanced its intelligence capability against syndicates trafficking illegal immigrants. These efforts have paid off, with more syndicate operations being crippled. For the first half of 1999, 10 trafficking cases were detected at the Woodlands Checkpoint as compared to only one case in the first half of 1998. Third, more and better trained officers deployed at the Checkpoints. SIR and Police have also deployed more and better-trained officers to intensify checks at both the land checkpoints. Lastly, SIR also works with the other Home Team's departments to jointly tackle the illegal immigrant problem. I am sure Members must have read in the papers about the use of SCDF rescue dogs deployed at the Woodlands and Tuas Checkpoints to sniff out illegal immigrants concealed in car boots or secret compartments in tourist coaches, lorries, and `Bas Kilang' buses. Sir, in addition to rigorous enforcement, we have also spread deterrent messages to potential illegal immigrants and traffickers. Since April 1998, SIR has been issuing pamphlets in four languages to foreigners at the land checkpoints carrying messages on the tough penalties for immigration offences. SIR has also been applying for deterrent sentences to be meted out when traffickers are prosecuted in court.

Sir, can the Minister of State say whether there have been instances where Singapore Immigration has apprehended illegal immigrants trying to leave Singapore by the Causeway? Second, would the Minister of State agree that if the Malaysian authorities also took tough measures to prevent such smuggling from taking place and by crippling the ground operations of these syndicates, it will be a win-win situation for both sides?

Sir, I take it that the Member is referring to illegal immigrants leaving Singapore. SIR also takes a tough stand against illegal immigrants leaving Singapore. Perhaps he has in mind a recent incident at the Causeway where 35 or so illegal immigrants tried to come into Singapore from Malaysia, and some of whom, because they were in a lorry, were killed. I think Members know and have read in the papers that SIR also takes a tough stand against illegal immigrants trying to leave Singapore. I think it stands to reason, because this would add to the deterrence that if you come into Singapore, even if you come in successfully, it would be difficult for you to leave. In any case, these people who successfully leave may return in future. And that is why SIR is vigilant. Indeed, just two days ago, it is in the Straits Times today, a small column, page 3, Members can read about it, a Malaysian registered vehicle was trying to leave Singapore with five Thai illegal immigrants. In 1999, for example, SIR has apprehended 23 such immigration offenders at the Woodlands Checkpoint. In 1998, 138 such immigration offenders tried to leave Singapore illegally, mainly in Malaysian registered cars driven by Malaysians. In the first six months of this year, 53 such offenders were arrested. Sir, in answer to the Member's second question, indeed, I agree with him that continued vigilance is important on both sides of the Causeway and I hope that the measures that he has mentioned would be considered by the Malaysian authorities.

Given that the illegal immigrants are on the rise and illegal immigrant trafficking seems to be on the rise, is there any intention to review the penalties, especially for the traffickers? I say this in the light of the recent case mentioned by the Minister of State that some illegal immigrants actually died on the way across in that particular incident.

Sir, the focus now is to plug this flow where in the past they came through the checkpoints. That is the focus of our efforts. In terms of the overall number of illegal immigrants caught, in fact, the number has come down. It has come down by about 30% for the first half of this year compared to the same period last year. But the number is still nevertheless high. I think there is no need at the moment to enhance the penalties. Looking at the situation of each case, for example, the case mentioned by the Member, if the driver is caught, one possibility is to charge him as a trafficker, and he would get up to five years' jail. But again it is up to the Attorney-General's Chambers. If indeed he is caught, the AG may look at the facts and the facts may warrant the AG to consider charging him under a more serious offence, perhaps causing death by a rash act. So there is a range of penalties which can be considered currently.

Sir, enforcement against illegal immigrants at the causeway has brought about other problems, especially to companies which require to move goods to and from Singapore. How do we ensure that these companies are not affected as more stringent enforcement is conducted?

If the Member is referring to the lorry queues, the situation, as I have said, has stabilised. Again, initially in the first few days, arising from teething problems, not just the lorries but all the other vehicles were affected. But in the second week of operations that we have monitored, the situation has improved and now the lorry queue is back to normal.

asked the Minister for Manpower if he will give an update on the employment situation since January 1999 to date, in particular, (a) how many new jobs were created; (b) how many jobs were lost; and (c) whether workers can expect to see better job prospects for the rest of 1999.

Mr Speaker, Sir, the labour market has shown signs of strengthening in the first half of 1999. In tandem with the pick up in economic activities, total employment rose by an estimated 15,400 in the second quarter of 1999. This is the first quarterly increase in employment after declining for four consecutive quarters. For the first half of this year, the total employment gain was 5,800. In other words, jobs created exceeded jobs lost by 5,800. This was a sharp contrast to the net job loss of 26,600 in the second half of 1998 when the impact of the economic downturn on the labour market was most severe. Unlike in the previous quarter, nearly all major sectors registered increases in employment in the second quarter of 1999. The employment gains came mainly from the real estate and business services with an estimated net job creation of 8,000, followed by manufacturing at 3,900, financial services at 1,400, hotels and restaurants at 1,200, and transport and communications at 1,000. Employment also rose by 4,300 in the other services sectors covering education, health, domestic and other community, social and personal services. In the construction sector, employment continued to contract for the fourth consecutive quarter. However, the net loss of 4,200 construction jobs was significantly less than the 10,500 in the preceding quarter. Preliminary findings from a survey of private sector establishments with at least 25 employees showed that about 3,300 workers were retrenched in the second quarter of 1999. This is close to the 3,400 displaced in the previous quarter. With the pick up in the economy, the number of workers retrenched in the first quarter of this year has fallen to 6,700, less than half of the 14,600 laid off in the second half of 1998. Recent economic indicators have been very encouraging. Manufacturing output grew by a healthy 10.4% in the first six months of the year compared with the same period last year. Non-oil domestic exports also rebounded with an increase of 10.3% in the second quarter of this year. While the economic situation has certainly improved, the recovery can only be sustained if there is continued strength in the developed economies and a benign environment in the region. As the economic recovery gathers momentum, this would have a positive impact on the labour market. We can expect demand for workers to increase while retrenchment is likely to moderate. Nevertheless, there would still be some retrenchments as companies upgrade or restructure to remain competitive. Lower educated workers who lack the necessary skills will remain vulnerable as industries move towards higher value added activities. Workers must not be complacent. They must continue to upgrade themselves to ensure that they are able to take up new jobs that are being created as the economy recovers. That is why my Ministry will continue to support skills upgrading programmes such as the Skills Redevelopment Programme.

What is the total number of retrenchment expected this year and which sectors would contribute mostly to this retrenchment?

Mr Speaker, Sir, at this juncture, it is rather difficult to give a final projected figure on the retrenchments likely to be experienced this year. But we know that it would be significantly less than the 29,000-odd workers who were retrenched last year. But it would probably be still a little bit more than the 10,000-11,000 that we experienced prior to the economic downturn in 1998.

I would like to ask the Minister three questions. (1) What is the current unemployment rate? (2) What is the net employment creation for the commerce sector? (3) What is the net employment creation for local workers as opposed to foreign workers?

Sir, the unemployment rate at the end of March this year was 3.9%. As for the current unemployment rate, the preliminary figures indicated that it is on the decline. It is coming down. We expect the unemployment rate to continue to decline. The figures will only be available when we issue the quarterly economic survey probably later this month. As to the details on the employment creation in the commerce sector, I am afraid I do not have the exact figures with me, but I would be prepared to share the information with the Nominated Member. As to the net employment creation for local workers as opposed to foreign workers, the demand for foreign workers has actually been fairly stable as a result of the economic downturn. In fact, we saw a dip in demand. In other words, employment creation for foreign workers would have gone down. As a result of the recession, many companies, particularly those in the construction sector, had to release their foreign workers. Therefore, we would expect a decline in the employment creation for foreign workers. But due to the swiftness of the recovery, we are also expecting to see a resurgence in the demand for foreign workers and the demand for work permits would rise quite quickly as the manufacturing, commerce and transportation and communication sectors pick up in their business prospects.

Sir, may I ask the Minister three points: (1) If one is given the figures year-on-year, as I understand it, how do the job numbers compare to the pre-crisis figures? Have we a net gain? (2) In the down swing, there were concerns about discrimination in job-hiring practices. What measures would the Minister take in the upswing to make sure that the jobs created are hired out fairly? (3) Is there a sense that the type of jobs we are getting are now different from the jobs we had in the pre-crisis days, as certain lower end jobs are gone for good and these people might face, in that sense, structural problems in seeking re-employment?

In terms of job creation that we are seeing in the first half of this year compared to the past, in other words, prior to the economic downturn, I have to say that we are still a long way. Between 1992 and 1997, we were creating between 70,000 and 120,000 jobs a year. Last year, we had a net job loss. In the first half of this year, as has been mentioned earlier on, the total employment gain was only 5,800. So we are a long way from what it was before. Perhaps, this is an indicator to say that the economy has not completely recovered to what it used to be pre-1998. As to the Member's question on discrimination, whether in the light of the economic downturn, there were any discriminatory practices adopted by employers vis-a-vis local workers versus foreign workers, I have replied to this point on a previous occasion in this Chamber that we have observed during the recession that, on average, when it comes to retrenchment, employers, in fact, retrench their workers without any discriminatory practices. In other words, the retrenchment reflects the profile of the workforce in the company. If the company has 50% local and 50% foreign workers in the manufacturing sector, then the retrenchment would take the same proportion. There was no evidence to show that there were clear attempts by employers to retrench Singaporeans and to substitute them with foreign workers. On the type of jobs that would be created as the economy recovers, I think this is a very important point. As the economy recovers, we will shift into a new area of competition. Our neighbours will also recover, just as we are recovering, and they will be very much more competitive in some of the more labour-intensive type of businesses, particularly in manufacturing. So, as I have said in my main answer, companies will have to restructure their operations, move on to higher value added activities, bring in new technology and introduce new processes. In fact, as the economy recovers, the jobs that are going to be created will be quite different from the jobs that were available prior to the recession. In fact, our workers will have to take note of this and make efforts to upgrade their skills so that they are able to take on the new jobs that are being created. If they do not upgrade their skills, they will find that when the economy recovers, jobs are going a-begging, but the unemployment rate may well stay high, mainly in the form of structural unemployment. This is a serious concern. That is why my Ministry, working together with all the other economic agencies, is putting in efforts to try to address this by providing more opportunities for skills upgrading and retraining to our workers, particularly the older workers and the less educated workers who are most vulnerable to structural unemployment.

Can I ask the Minister whether the most affected workers are the older workers and what plans are there to enhance their employability?

Sir, I agree with the Member that during the economic downturn of last year, the workers who were most affected by unemployment and most vulnerable to retrenchment, were indeed the older workers. Many of these older workers missed out on the opportunity for a good education and for skills training when they were younger. Now they are in their mid-40s and they become very vulnerable to retrenchment. In fact, if I recall correctly, they were over-represented among the groups of workers who were retrenched. That is why we have to have special programmes to meet their needs. In the way I responded to the Nominated Member, Mr Simon Tay, we have to put in extra efforts in this area to help the older less-skilled workers to upgrade their skills. The Skills Redevelopment Programme is one such programme focused at meeting the needs of the older workers, helping older, less skilled workers to upgrade, refresh their skills, so that they can take on the new jobs that are being created, in other words, helping them to avoid structural unemployment.

Sir, the newspaper reports show that Malay workers are more prone to retrenchments and have greater difficulty in finding new jobs. Two questions: (1) Do the latest statistics from the Ministry confirm this? (2) How successful have retrenched Malay workers been looking for new jobs?

Sir, during the economic downturn, nearly two-thirds of the retrenched workers came from the manufacturing sector. And the vast majority of those who were retrenched in the manufacturing sector were the production operators. Many Malay Singaporeans work in the production operation type of jobs in the manufacturing sector. Then, logically, you expect that you will see more Malay Singaporeans among those who were retrenched as a result of the economic downturn. As to helping them to find re-employment, we have made every effort to help all Singaporeans who were retrenched as a result of the downturn. We have organised many job fairs with the support of the various Community Development Councils. The job fair was an attempt to bring employers who are still recruiting to the community, and very often at the community centre itself, and to bring people living in the vicinity of the community centre to come down if they need job assistance. We found the job fairs to be quite useful in helping unemployed Singaporeans look for jobs. We also benefited from the support given to us by the various community self-help groups. For instance, MENDAKI and even AMP have actively participated in some of our employment exercises. Likewise, SINDA and CDAC have also participated in helping to act as surrogate employers for unemployed Singaporeans who need to go for further training before they can take on new jobs. So, in the Skills Redevelopment Programme, we, in fact, were able to work with the community self-help groups such as MENDAKI, SINDA and CDAC whereby the self-help groups will take on the role of employers for the unemployed Singaporeans and put them through the SRP programme, providing the financial support for them, so that they can undergo training to take on new jobs.

asked the Minister for Manpower whether he will consider lowering the Medisave contribution rate for Central Provident Fund (CPF) members aged 60 years and above so that they have sufficient funds in the CPF Ordinary Account to pay for housing mortgage loans.

Mr Speaker, Sir, the Government recognises that as a result of the CPF reduction implemented on 1st January 1999, CPF members who have committed all their CPF Ordinary Account savings to housing would need assistance to tide over the difficult period. It is with this in mind that the Government has introduced the bridging loan scheme and a range of HDB assistance measures to help CPF members who are affected by the CPF reduction. These measures help to minimise the impact of the reduction in Ordinary Account contributions on CPF members' ability to service their housing loans. As at 30th June 1999, 126 CPF members have applied for the bridging loan scheme. 89 of them are for the servicing of private property mortgage loans. This is less than 0.1% of the total number of CPF members who are fully or partially using their CPF savings to service their private property mortgage loans. The balance 37 CPF members who applied for the bridging loan are HDB mortgagors on market interest rate. According to HDB records, from December 1998 to May 1999, slightly less than 10,000 HDB mortgagors (about 2% of total HDB mortgagors) have been assisted under the various HDB assistance measures. These measures include the rescheduling of mortgage loan instalments, converting mortgage loans to reduced repayment scheme, allowing working family members as joint-owners to help settle mortgage arrears or requesting HDB to allow mortgage arrears to be settled by instalment plan. The CPF cut has thus not caused severe difficulties to many CPF members. Hence, it will not be appropriate to reduce the Medisave contribution rate for CPF members who are aged 60 and above. In fact, they are the ones who need more savings in their Medisave Account. The Medisave contribution rate of 6-8 per cent takes into account the greater need for CPF members to save for their hospitalisation expenses as they grow older. The Member for Hougang may wish to know that if a CPF member's Medisave Account has reached $22,000, any additional contributions to his Medisave Account will overflow automatically into his Ordinary Account. This will avoid an excessive build-up of Medisave balance and allow the members the flexibility to use the contributions for housing or other purposes. For these reasons, we will maintain the Medisave contribution rates.

Does the Minister agree that even before the economic downturn when the CPF rate was cut, CPF members who have reached the age of 60 and above, their total CPF contribution was 15%, and 8% of the 15% had to be contributed to Medisave, which I think renders very little money in their Ordinary Account to service the housing loan? So for those who are still serving their mortgage loans and have difficulty in paying, would the Minister consider allowing these people to temporarily give a lesser contribution to Medisave to help them tide over the period?

Mr Speaker, Sir, the reduction in the CPF contribution for those who are aged 60 and above has been in place for some time already. So CPF members who purchase property should have made their calculation on the basis of their existing CPF contribution. When we raised the retirement age from 60 to 62 effective this year, there was a slight reduction in CPF contribution for those aged above 60. But that was a very, very small adjustment only and would not have caused additional difficulties to those CPF members who are still servicing their mortgage loans. As I have explained in my answer, in fact, the 8% contribution for older CPF members is really necessary, because they are the ones who are most in need of accumulating savings to meet their medical expenses. If we were to allow them to use these Medisave savings to finance their mortgage loans, we might expose them to other dangers later on if they should suddenly fall ill and need to be hospitalised. They would still end up facing a problem. So it is better for us to remain focused on what we are trying to do. What is Medisave for? Medisave is for you to save to prepare for your hospitalisation expenses. If you have sufficient CPF contribution now, even with the reduction, you should emphasise on putting aside the amount that you need for your medical expenses. That is first priority. The rest, if you have additional savings left over to service your loan, fine, by all means. If you have other difficulties, eg, if you are in a HDB flat, as I have already explained, there are many measures offered by HDB to assist home owners who have difficulty paying their mortgage loans. If you are in the private sector, when I look at the figure, it is such a small percentage of people who are affected and who have to apply for the bridging loan. If they want to, more can come forward. They are welcome to come forward and apply for the bridging loan, and we will help them through the bridging loan, rather than erode the savings for medical expenses which they would need sooner or later.

asked the Minister for Information and the Arts whether the Ministry's policy is that all newspapers, being private entities, must restrict opinions expressed in their editorials to strictly conform with Government policy, especially as regards views expressed on our ASEAN neighbours.

Suan): Mr Speaker, Sir, MITA does not control the editorial line of our newspapers, which are independent private entities. However, editorial independence does not mean complete freedom to write as they desire. Singapore newspapers must also be circumspect when commenting on the domestic politics of our ASEAN neighbours. Where Government feels an editorial is rash and inappropriate and not in the national interest, it will make its opinion known, as was done in the case of the recent Business Times editorial.

May I ask, given that the Government has no control but only acts in rash and inappropriate circumstances like the Business Times, whether the Government intends to take any measures or penalties against Business Times, or to review its printing permit?

Mr Speaker, Sir, the answer is no.

The Minister said that the Government does not control the editorial of newspapers. Does the Government influence the editorials of newspapers?

The Government does so when the newspaper is rash in its editorial policy.

asked the Minister for Education (a) how many children failed to register for primary school between 1992 and 1999; (b) what are the reasons for these children not registering for school; and (c) whether his Ministry will consider a policy on compulsory education for all children.

Mr Speaker, Sir, most parents are responsible and do register their children for Primary 1 in mainstream schools. Between 1992 and 1999, an average of about 1,500 children each year failed to register for school by the end of the Primary 1 Registration exercise. This is about 2%-3% of the eligible age cohort. For children who do not register for Primary 1, the Ministry of Education makes the extra effort to track down the families, offer them advice, and help to enroll the children in schools. Could I ask the Clerk of Parliament to distribute a table. [Copies of table (Cols. 1985-1986) distributed to hon. Members.] Table - Breakdown of the 1677 Children not Registered for Admission to P1 after 1997 P1 Registration Exercise (Cols. 1985-1986) First, letters, followed by reminders are sent to the parents, inviting them to register their children for school, or requesting information about their children's education. Where necessary, Ministry of Education officers follow up with visits to these families at their last known addresses, and most of these visits are conducted in the evenings to maximise chances of meeting the parents. Through these efforts, about 70%-80% of these roughly 1,500 children eventually either enroll in mainstream schools with help from the Ministry of Education and MCD, or have made alternative schooling arrangements in Islamic Religious Schools, Special Education Schools or Private Schools. The remainder have either left the country, are medically unfit for school, have no known address, or cannot be contacted at their last known address. These are listed down for 1997 in the table that I have just distributed. We thus already have a system in which we systematically follow-up every case of non-registration for primary school. The Ministry of Education has considered the option of introducing compulsory education in Singapore very carefully, and has decided not to do so for the following reasons: (1) We must strike a balance between state's responsibility and family's responsibility. The Ministry of Education will make school places available, but parents and the family must want to send their children to school. This is a family's responsibility. Making education compulsory will undermine the principle of self-reliance and sense of parental responsibility which undergirds society; and (2) Even if we legislate compulsory education for all children of school-going age, that does not in itself ensure attendance, much less motivation. Enforcement becomes a major issue. Jailing or fining parents who fail to register their children, or who do not send their children to school after registration, is unlikely to solve the problem, and may even make matters worse for the child and the family. Compulsory education does not solve the root problem, and it may merely re-surface in another form, such as absenteeism or truancy. There is great concern that children who do not attend schools will be disadvantaged as Singapore becomes a knowledge economy. This is a concern which my Ministry shares. We will continue to work with MCD and other organisations to persuade, encourage and help parents to enroll their children in school. This is ultimately a more effective way than making education compulsory.

I agree with the Minister about balancing the responsibility of the family and the school. But, Sir, in this case, is it not the responsibility of the state to give a strong sanction to families that are obviously irresponsible? We are assuming that parents are responsible to send their children to school. But when parents are irresponsible and do not send their children to school, what is the Minister's position then?

Sir, as I said, by making education compulsory, we do not solve the root cause of the problem. In fact, we are looking at the symptom of the problem. What the Member is asking is whether or not we should be separating children from their parents because we, or somebody else, or perhaps the Member, judge that the parents are not carrying out their responsibility properly. That is a much larger question that goes beyond compulsory education.

Sir, I am not in favour of compulsory education either. But I think that we should be interested in the best interest of the child. Let me ask the Minister then. In the question of follow-up in the Annex that is given to us, if I add the figures for items 3, 4, 5 and 6, in item 3 (Parents responded to letter but did not specify very much), item 4 (Addresses not available), item 5 (Parents could not be contacted at the address stated) and item 6 (Parents have divorced and whereabouts of child are not known), may I ask the Minister, given that this is over 50% of the figures, will the Ministry further follow up? Surely it is possible for the SIR or other Government agencies to update the addresses and to pursue the parents and the children?

Sir, first, I will comment on the way that the Member has added up the numbers. Item 3 should be added to the first two items, ie, items 1 and 2, that is, these families have indicated that their children are attending some form of schooling or other. So item 3 should be added to items 1 and 2 and you will get about 75%. For items 4, 5 and 6 where the parents' addresses are not available in the record, parents could not be contacted at the address stated and parents have divorced and whereabouts of the child are not known, we will take whatever measures we can to trace the children. As I said, we have a record of all these children and we actually go to quite some length to follow up on each of them. And I think that is a better way of dealing with the issue of trying to get as many children as possible into school than some blanket formula, like compulsory education, which looks nice but is not going to solve the problem.

Mr Speaker, Sir, item 5 in the Annex says that parents could not be contacted at the address stated. The Minister just now has addressed the problem. May I ask the Minister whether he will consider speaking to the neighbours of these people to find out whether they could be contacted because the figure is quite alarming? At least, other steps should be taken to address this matter.

Sir, I leave it to the people on the ground to do this. These are quite dedicated people and they are interested in wanting to get the children to go to school. In fact, what we are doing is that we especially hire some retired teachers and give them the list and ask them to go and try and trace these children. These people are quite dedicated. They have the interest of the children at heart and they do try their best to find them.

Sir, despite what the Minister has said, I remember not long ago the then Minister for Education said that there were 2,900 students who had not been enrolled in schools but now the Minister has given the figure of 1,500. Why is there this contradiction? That is the first question. The other point is that the Minister says that education is a family responsibility. The fact that the state has educational facilities for these children, does the Minister not think that the state is in fact irresponsible by not getting these children to school? How can a child be thrown into society without learning how to read and write?

Sir, I am unable to answer the Member's first question because I do not quite understand it. On the second question that the Member has asked, I have already explained that. There should be a balance of responsibilities between the state and the family. The state provides the places. The families should want to send the children to school. And we take quite extraordinary measures to track them down and encourage them to come to school. While we want all of them to come to school, I do not believe that compulsory education itself is going to solve the problem. What do we do if the parents do not wish to send their children to school for some reason or other? Do we jail them? Do we fine them? I think that will make the problem worse. You break up the family. So while we want to encourage all these children to come to school, we need something which is more than compulsory education. Compulsory education is not a magic bullet which, if we enact, will suddenly see all the children in school miraculously. In fact, what we are doing is quite a sensible and reasonable approach, ie, to encourage as many children as possible to come to school, I think we have achieved quite considerable success.

Sir, does the Minister agree that the paramount interest must be the child? Even if the family is broken up because the state wants the child to be in school and one of the parents says no, does the Minister not think that the interest of the child should come first? If the family is going to be broken up, so be it. But the child must receive an education, otherwise he will be disadvantaged for the whole of his life.

I am not sure everyone would agree with the Member's assertion that the family must be broken up.

I was interested to hear the Minister say that the family should not be compelled to send children to school. Is the Minister not aware that in a great many other areas, compulsion is brought on adults to do whatever the Government thinks should be done, for example, topping up Medisave. Licences are not renewed unless people go and top up their Medisave? Is that not a compulsion even when they cannot afford to top up?

Mr Speaker, Sir, in some cases, this will work, but in other cases, it will not. In the case of compulsion to attend school, I do not think it is going to work because it depends on a larger series of things to be in place first. I can compel or I can try to compel children to be in school, but I cannot compel them to be looked after properly when they are at home for 18 hours. A lot of things can happen during that period of time. As I have explained, compulsion to send children to school will not necessarily mean that they will be in school because there will be other issues then, like absenteeism, truancy, and so forth, which will not be solved merely by enacting legislation or putting in place the rule that says that all children must be in school. If we could magically solve that problem, I will be the first to do so.

I am still not convinced by the rationale. We have fines and legislation that have made people respond properly, so why cannot we compel parents to send their children to school? Would that not create a positive response? I would like the Minister to elaborate on that again.

Mr Speaker, Sir, I circulated the Annex basically to show what we have done. I am not sure which group of these children we intend to compel to come to school because items 1, 2 and 3 are children who are already going to come to school. For items 4, 5 and 6, we cannot trace them. So how do we compel them?

Would the Minister clarify item 3 in the Annex that parents responded to MOE's letter but did not specify whether their children were in local mainstream schools or other types of local schools? Are they in school or are they not in school? Does the Minister know?

Sir, as the parents have responded that their children are in school, we take their word for it.

I think there is a deeper issue here. The numbers actually are quite small. Categories 5, 6 and 8 together add up to only 282 children. But the issue is: should the child suffer because the parents are irresponsible? And I think many of us feel that children should not be made to suffer simply because their parents do not send them to school. In which case, if it needs legislation to have some sort of compulsion to enable the state or the authority to send those children to school, so be it. But the issue is that the children should not suffer because the parents are irresponsible.

Mr Speaker, Sir, children always suffer when their parents are irresponsible. I am not sure that compulsory education, while it sounds very nice, is going to solve this particular problem. If you have irresponsible parents who have children and they do not bring them up properly, compulsory education on its own is not going to solve the problem. What we are talking about is removing children from the care of their parents. That is not compulsory education. That is a different subject.

Order. I think hon. Members are repeating the question in one form or other. We seem to be getting the answer in one form or other too. Unless there are fresh questions, I intend to proceed. Yes, Dr Wang.

Would the Minister elaborate the experience of other countries that have compulsory education and give us their experience and see whether or not Singapore should adopt compulsory education?

Many countries have compulsory education. But I do not have the data with me. I was trying to track it down to answer the NMP's question, and I would track down the data. But from what I know of education that takes place in a number of these countries which have compulsory education, it is a nice piece of legislation but not all the children are in school.

Would the Minister give a breakdown of the number of students who have gone to Islamic schools, special education schools and private schools separately?

I do not have the breakdown with me right now. I will try and get it. But if the Member would file another question, I will try and get the data for him. I may not be able to get all.

Has the Government considered making education free for children of parents who may find it very difficult to send their children to school? Would the Government find some money for that?

Mr Speaker, Sir, education is available to all in Singapore and a wide range of schemes are available. If there are children who the Member knows are unable to attend school because of financial reasons, please let me know. We will refer them to the appropriate authorities to help them, if the Member is unable to refer them to those appropriate authorities.

May I ask what is wrong in making a general policy announcement instead of leaving it to the parents to appeal for charity every time?

I am not sure what general policy announcement the Member is asking for. But as I have explained, anyone who needs financial assistance for his children to be in school, he is able to get it. If the Member knows of any such person, please let me know if he is unable to help him himself. 1.30 pm

Order. End of Question time. [Pursuant to Standing Order No. 21(3), Written Answers to Question Nos. 12-17, 21-25, 27-29, 31-33, 35-37 on the Order Paper are reproduced in the section, "Oral Answers to Questions Not Reached" (Cols. 1963 - 1984). Question Nos. 11, 18-20, 26, 30 and 34 have been postponed to the next sitting of Parliament.]

Order for Second Reading read.

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The purpose of this Bill is to make final provision for an additional expenditure of $1.8 million for payment of expenses on investments (EOI) under the Ministry of Finance (MOF). The supplement will bring the total provision for EOI in FY98 to $247 million. The FY98 provision for expenses on investments was $227 million. The final expenses on investments came to $247 million which was $20 million more than projected. After offsetting savings of some $18 million from other votes under the Ministry of Finance, a further supplement of $1.8 million is needed. The higher expenses were incurred because of increased investment opportunities towards the end of FY98, which had resulted in higher than expected expenses. In a sense, it was a happy problem because higher profits had accrued. Members will appreciate that it is difficult to estimate accurately the requirements for expenses on investments, especially given these times of market volatilities. Sir, I beg to move.

Question put, and agreed to. Bill accordingly read a Second time.

Sir, I beg to move, "That the Bill be now read a Third time."

Question put, and agreed to. Bill accordingly read a Third time and passed.

Order for Second Reading read.

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Bill proposes to license insurance intermediaries (agents and brokers) carrying on business in Singapore. Currently, there are 150 insurance brokers and 28,000 insurance agents in the Singapore insurance market. Except for six brokers who are registered under section 36(6) of the Insurance Act (Cap 142) for the purpose of placing business with Lloyd's in London, the rest of the brokers and agents operate under self-regulatory systems maintained by their relevant trade associations. While self-regulation has been satisfactory so far, MAS has felt the need to supervise brokers' activities and to enhance the quality and professionalism of insurance brokers in Singapore. Licensing would enable MAS to have oversight of insurance brokers' activities and conduct, thus furthering the protection of policyholders' interests and ensuring proper development of the insurance industry. Countries like the United Kingdom, Australia, Hong Kong, Malaysia and certain states in the United States have, similarly, enacted legislation to govern insurance brokers' activities. Rather than incorporating the new requirements for licensing of brokers in the Insurance Act, the Government proposes the enactment of a separate legislation. The rationale is that the activities of insurance brokers are substantially different from those of insurance companies. In drafting the proposed legislation, MAS has had several rounds of consultation with relevant trade associations. The insurance industry generally welcomes and supports the proposed licensing of insurance brokers. I will highlight the key provisions of the Bill. Clause 3 of the Bill makes it an offence for any person to act as an insurance agent for a registered insurer unless he has a written agency contract with that insurer. Similarly, clause 12 prohibits any person from carrying on insurance broking business unless it is registered with MAS. All licensed insurance brokers are required, under clauses 17 and 21, to maintain minimum paid-up capital and net asset value of 50% of minimum paid-up capital at all times. These requirements are necessary so as to establish the brokers' commitment to operate in Singapore and to ensure that they possess a minimum level of financial assets. Further, to protect the insuring public against wrongful advice and against suffering any financial loss due to brokers' negligence in carrying out their duties, all brokers are required to have professional indemnity insurance covers. As insurance brokers are holding clients' and insurers' moneys in trust, it is imperative that brokers maintain proper accounts of these moneys. Clause 22 requires all brokers to maintain separate bank account(s) with a bank(s) licensed under the Banking Act. All premium receipts and claim moneys received by brokers on behalf of their clients must be duly deposited into these accounts and only specified withdrawals can be made. It is customary for insurance intermediaries to collect premiums from policyholders for payment to the insurers. Similarly, insurance claim payments may be made to claimants through the intermediaries. In order to protect policyholders' and claimants' interests, clause 4 stipulates that where premiums are paid by a policyholder to an insurer through an intermediary, the payment will be considered as a discharge of the policyholder's liability to the insurer up to the amount of the payment. However, where an insurer transmits claim payments to a claimant through an intermediary, the insurer remains liable to the claimant for those moneys. Clause 24 restricts a registered insurance broker from receiving, and prohibits insurers from giving, any remuneration to the broker that is tied to the broker's business volume, for example, production bonuses which are paid on achieving certain levels of business volume. This clause is to minimise conflict of interest between brokers and their clients as well as to enable brokers to uphold their independence and professionalism. If an insurer offers production bonuses to a broker, this may influence the broker to place more of its business with that insurer, against its duty to source for best covers for its clients. The Bill also provides for the control of appointment of key persons, that is, chief executive officers and directors of broking firms. Clause 25 requires brokers to seek MAS' approval before allowing any interested party to acquire 20% or more of its voting share capital. Clauses 28 to 33 allow MAS to require returns, inspect insurance intermediaries or any persons suspected of carrying on insurance broking business in Singapore, issue directions and wind up the affairs of a registered broker. MAS is also empowered under clause 41 to make regulations generally for carrying out the provisions of the Act. The Bill carries a transitional provision to deal with persons who are employed in the insurance broking business before the enactment of the Act. To ensure that the proposed licensing does not pose undue difficulties on existing brokers, they would be given six months to seek and obtain the necessary approvals from MAS to continue conducting their business. Sir, I beg to move. Question proposed.

Mr Speaker, Sir, I rise in support of the Bill which would help raise the professional standards of intermediaries and hence the insurance sector at large. Equally noteworthy are the provisions to be put in place so that the insured, that is the end-users, are adequately protected. There remains a need to clarify the extent of recourse available to an insurance company in the event of default by an intermediary with specific reference to the broker intermediary. Sir, clause 4(1) and (2) effectively discharge the insured and intending insured from any liability to make further payments to the insurer if moneys, such as premiums payable to the insurer, have already been paid by them to the intermediary. While these provisions protect the insured, albeit to the extent of moneys already paid, the insurer is bereft of any recourse under these provisions for moneys due to him. By the same token, under clause 4(3), an insurer who pays to the intermediary, moneys such as claims or return of premiums meant for the insured party, remains liable to the insured until receipt by the insured. Likewise, the insurer has no recourse under these provisions. Sir, this could imply an assumption of liability by the insurer for which he has little control over, particularly with respect to insurance brokers. Unlike agents over whom the insurer can exercise some level of control, brokers are a different entity altogether. Insurers have no jurisdiction over brokers' functions and actions. Although clause 2(1) gives the definitions of insurance agent and insurance broker, the Bill appears to be silent on their explicit responsibilities and liabilities vis-a-vis the insurer and the insured. Notwithstanding the above comments for which I seek the Deputy Prime Minister's clarifications, I support the intent of the Bill.

Mr Speaker, Sir, I wish to refer specifically to clause 23 of the Insurance Intermediaries Bill which states in no uncertain terms that: "No registered insurance broker shall, in the course of its business as such, negotiate any contract of insurance with the insurer (whether directly or through an insurance intermediary), except with a registered insurer acting in the course of his business as such." References to "contract of insurance" are further spelt out in subclause (3) as not applicable to the reinsurance or business relating to risks outside Singapore. Notwithstanding the fact that Singapore intends to provide local insurers the opportunity to write business, the restriction creates a position where Singapore shipowners are forced into paying uncompetitive local rates for certain specialised insurance. Marine hull insurance is an example which I will elaborate on. I am personally involved in the shipping business and am conversant with the procedures whereby insurance intermediaries obtain quotations on marine hull insurance. The quotations by the overseas insurers on marine hull insurance can sometimes be only 50% or one-third of the quotations obtained from local insurers and yet the insurance intermediaries will be bound by clause 23 of the Insurance Intermediaries Bill to engage local insurers even if their rates are extremely uncompetitive vis-a-vis the overseas insurers as long as they have supplied the quotations. Subclause (5) does provide for exceptions where the MAS will grant approval by reason of exceptional nature of the risk or other exceptional circumstances. However, in practice, the shipping industry has not benefited from such approvals from MAS. Singapore's financial industry has been undergoing deregulation and liberalisation with the removal of barriers to full foreign participation in the domestic banking sector. Similarly, measures would be taken to liberalise the insurance sector to fully develop Singapore as a regional financial hub. The Insurance Intermediaries Bill does not appear to make sufficient provisions for this. If local insurers supplying uncompetitive rates are given undue protection under this Bill, Singapore's shipowners would be greatly disadvantaged. I believe that it is imperative for the Singapore shipping community to take advantage of the most competitive rates available worldwide. At the same time, the local insurance intermediaries should be given the liberty to source quotations from overseas insurers. It appears to me that the principle embodied in clause 23 is tantamount to protectionism of the local insurers. Surely, this is contrary to the fundamental tenets of an open economy which Singapore champions. I also wish to refer to clause 24 of the Bill which relates to the restriction of receipt and payment of any gifts, gratuities, benefits or other rewards (however described) for the services of a registered insurance broker. In other words, insurance intermediaries, specifically registered insurance brokers, will be prohibited from receiving an "incentive bonus" from the insurance companies which they deal with. Many small and medium-sized insurance broking firms are receiving such an "incentive bonus" from the insurers in Singapore. Moreover, this form of remuneration is acceptable and has always formed part of the remuneration received by insurance brokers. The incentive bonus paid to the insurance brokers has not caused problems to the insurers, neither has it prejudiced the insuring public. If clause 24 is passed, this would mean the loss of an estimated 20% of income to each affected insurance broking firm, resulting in possible retrenchment of their employees and translates into the loss of an important source of revenue. Mr Speaker, Sir, a regulatory framework is indeed necessary. However, over- regulation in business practices will unfortunately stifle business initiative. Singapore businesses need to have a certain leeway to survive, thrive and excel in the global marketplace. Where appropriate, they should be allowed to operate within a reasonable market practice. I propose that MAS conducts a thorough review of the insurance industry and how it is performing its role of serving the rest of the business community with a view to amending those laws which are no longer appropriate for the promotion of Singapore as an international business hub. Mr Speaker, Sir, with the exception of clauses 23 and 24, given the foregoing reasons, I support the Insurance Intermediaries Bill.

Mr Speaker, Sir, Mrs Lim Hwee Hua asked about the assumption of liabilities of insurers on behalf of brokers. She said that she could understand why insurers would assume liabilities on behalf of agents, but does not see why they should do so on behalf of brokers. Clause 4 of the Bill holds insurers accountable for liabilities of agents and brokers in respect of premiums collected from policyholders by the intermediaries and claim payments made to claimants through intermediaries. It deems premiums received by an intermediary as having been received by the insurer, but the insurer remains liable to the claimant for any claims monies made through an intermediary. Basically, this is a consumer protection measure, because it seeks, firstly, to protect consumers from paying premiums a second time where an intermediary does not pass the money on to the insurer. And, secondly, to ensure that the claimants will receive their payments where an intermediary fails to transmit the claims money. The boundary between the insured and the insurer is put on the side of the intermediary. The intermediary is on the insurer's side. This provision is applicable to both brokers and agents, as it is also found in the Australian Insurance Agents and Brokers Act, 1984. It is deliberately designed to apply to both brokers as well as agents, because whether or not an insurance broker is only the agent of the insured depends on the facts and circumstances of a particular case and the type of the insurance business, and the common law rule is that in some cases, the broker may actually be acting as an agent for the insurer. Mr Tay Beng Chuan raised two questions. The first one has to do with basically marine hull insurance. First, may I clarify that there is no restriction whatsoever on a person who wishes to place insurance risk directly with an overseas insurer. If the rates are more competitive, you may choose to go there, and that includes shipping companies or anybody else. But an overseas insurer is not licensed to operate in Singapore. An unlicensed insurer is not allowed to write domestic Singapore risks. This restriction is similar to that of most jurisdictions, including the US. So clauses 7 and 23 of the Bill essentially ensure that neither brokers nor agents are allowed to assist unlicensed insurers to write domestic Singapore risks. Where there is a lack of expertise or capacity in the local insurance industry, MAS will grant exemption for the risks to be placed directly with overseas insurers. And the majority of risks that have been granted exemptions are marine hull and liability risks. The statistics for the last three years show this. For example, in 1998, we received 160 applications for exemptions for lack of expertise or capacity locally. Out of these 160 applications, 158 were approved. For marine hull and liability, we received 49 applications last year, and all were approved. We recognise the need to develop marine hull and liability expertise and to increase the local capacity so as to help develop Singapore's international maritime hub. So we have taken the lead to attract specialist maritime insurers to Singapore and we have also provided tax incentives for their offshore marine and hull liability business. The Member suggested that we should undertake an overall review of the insurance industry and the legislation which applies to it. This is indeed what we are in the process of doing. MAS is currently reviewing our admission policy on insurers and we hope we will have some clear conclusions within a few months. But even if we are to open up the insurance market in Singapore, no overseas unlicensed insurers will be allowed to operate in Singapore unless they are registered with MAS. This upholds the principles of insurance regulations of the international regulators, because if they are not licensed and they operate here and something goes wrong, the Government will be responsible. If they are overseas and you go and look for them, that is you are taking it on yourself, but they are not operating in Singapore. The Member also raised a question of gifts, gratuities, benefits and other rewards from insurance brokers. I presume that when Mr Tay refers to "incentive bonus", he means everything received by the broker other than the brokerage or the fee. Clause 24 of the Bill seeks to prohibit brokers from receiving any payments from an insurer including gifts, except as remuneration for services rendered in arranging a particular contract of insurance or settling a claim. And the payment in such cases cannot vary according to the number of contracts, the amount of premiums or sums insured that are placed with a particular insurer. The clause prohibits the giving of production bonus which is tied solely to the broker's business volume. This bonus is paid to brokers for achieving certain levels of business volume with a particular insurer. The rationale for the prohibition is that when an insurer offers such production bonuses to a broker, it is likely to influence that broker to place most, if not all, of its business with that insurer, whereas, in fact, the broker has a duty to his client to source for the most appropriate cover and terms for his client. Such a restriction is also found in the Australian Insurance Agents and Brokers Act, 1984. Again, the objective in the Australian legislation is to ensure that the broker's impartiality is not influenced by incentives or volume-based remuneration and to ensure that the broker's obligation to his client is not compromised. Under the Bill, other than volume-based incentive bonuses, brokers are not prohibited from receiving other types of incentives such as profit commissions and persistency bonuses.

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. - [BG Lee Hsien Loong]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Order for Second Reading read. 1.57 pm

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Insurance Act was last amended in 1993. With the promulgation of the Insurance Intermediaries Bill 1999 which we have just dealt with, consequential amendments have to be made to the Insurance Act. At the same time, several amendments are also proposed which are aimed at clarifying the scope of present regulatory requirements and to reflect current practices in the insurance industry. All the provisions in the Insurance Act that relate to agents and brokers will be repealed and taken up in the Insurance Intermediaries Bill. Clause 3 (section 5A) of the Insurance (Amendment) Bill requires the setting up of new insurance representative offices to be approved by MAS. This control measure is necessary as representative offices can easily underwrite insurance business and it is difficult to uncover such activities. In addition, the clause prohibits, firstly, any persons in Singapore, including staff of unregistered insurers or any of their representatives, from soliciting direct insurance business for the unregistered insurers; and, secondly, the establishment of an office in Singapore by any person to solicit reinsurance business for unregistered insurers. Clause 8 tightens the control of takeovers of insurers to include direct and indirect acquisition, holding or control and acquisition of a right to shares under an option. While the Insurance Act provides MAS with the power to control takeovers and substantial changes in shareholdings of locally incorporated insurers, the power does not extend to holding companies. The amendment widens the present control to include indirect shareholdings. To safeguard policyholders' interest and to discourage insurers from granting unsecured credit facilities to directors or employees, clause 10 broadens the restriction on the granting of unsecured loans by insurers to directors and employees to include grant of unsecured advances. Clause 12 updates the description of Lloyd's. Lloyd's, a society of underwriters in the UK and incorporated under the Lloyd's Act 1871, is an approved insurer under the Insurance Act. In recent years, it has undergone major structural changes. Since 1994, it has been admitting corporate memberships. Unlike the original Lloyd's members who are individuals, the corporate members can either be limited liability companies or partnerships. Consequently, the description of Lloyd's in the Insurance Act is no longer accurate. The Bill also proposes, in clause 14, to clarify that where a registered insurer becomes insolvent, priority of claims would be granted to policyholders on an individual insurance fund basis. Assets of an insurance fund would be used, firstly, to meet the claims of its policyholders, secondly, the other creditors of that fund; and, finally, any balance in that fund would be released to other policyholders and creditors of the insurer. Clause 15 provides for legal immunity of MAS and its employees in the course of carrying out its regulatory functions. The existing section 54 of the Insurance Act requires MAS to prepare and submit to the Minister an annual report on the working of the Insurance Act for presentation to Parliament. Section 54 is no longer relevant and clause 16 seeks to repeal this provision. Prior to 1977, the Insurance Department (ID) was under the Ministry of Finance and its annual report was intended to ensure accountability. The Insurance Department was transferred to MAS on 1st April 1977, and with effect from 1st April 1998, has been brought under MAS' Financial Supervision Group to enable consolidated supervision of all financial institutions. It is no longer necessary for the Insurance Department to present an independent report to Parliament as MAS submits a comprehensive annual report, including the same matters required under section 54, to Parliament. 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. - [BG Lee Hsien Loong]. 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." Introduction Around the world, exchanges are facing new forces of change. They must contend with increasing global competition from existing and new players, and investors who demand cheap and efficient channels for trading. New electronic trading systems are executing trades between large market participants at low cost, bypassing the exchanges. Exchanges themselves are seeking to link up or forge alliances, so as to remain competitive and to offer a wider menu of products to investors. In Singapore, the stock and derivative exchanges, the Stock Exchange of Singapore ("SES") and the Singapore International Monetary Exchange ("SIMEX"), have thus far performed well, contributing significantly to the development of our financial markets, and serving both regional and international investors. But Singapore's exchanges must now urgently re-define their strategies so as to remain viable and relevant, and to serve investors as cheaply and efficiently as technology allows and the competition demands. In November last year, I announced that the Government had accepted the recommendations of the Committee on Governance of the Exchanges. SES and SIMEX would be merged, and at the same time be demutualised, in other words, no longer run as a member-owned entity, but as a private, stock company accountable to a broad range of shareholders. These changes are essential if the exchanges are to respond quickly to new challenges and remain competitive. A merged exchange would also be able to reap benefits in the future from a common user interface and trading platform. It would also be able to offer a variety of integrated products and services which cut across traditional cash and derivative asset classes. Since November last year Hong Kong has also announced its intention to combine and demutualise its stock and futures exchanges. The two exchanges have just agreed to the plan. The Hong Kong Government has stated that unless the members of the two exchanges vote for the plan, the government will pursue merger and reform through other means. In Australia, the Australian Stock Exchange, which went public a year ago, is seeking to merge with the Sydney Futures Exchange. The New York Stock Exchange and the London Stock Exchange have both just announced their plans to demutualise. The Financial Times quoted one London stockbroker saying: "Running an exchange must be like living in biblical Jericho with the walls falling down all around you." Transfer Provisions The purpose of this Bill is to demutualise and merge SES and SIMEX. The first part of this Bill deals with two matters. The first is the process of demutualising and merging the SES and SIMEX. The second is the placement of shares of the combined exchange to new investors. The approach to both matters has been endorsed by the Pro-Tem Committee of the Integrated Singapore Exchange ("PTC"). The demutualisation and merger of SES and SIMEX will be effected by a transfer of ownership from existing members who hold shares in SES and SIMEX to a new transferee holding company, or Newco. On Transfer Date, which is targeted for 1st December 1999, the existing shares of SES, SIMEX and SCCS which are currently held by the members will be cancelled. (SCCS is the computer arm of the SES jointly owned by SES itself and its SES's 26 local members. Since SCCS is not a wholly-owned subsidiary of SES, its shares will have to be cancelled separately.) At the same time that these shares are cancelled, the three companies will issue new shares to Newco. In return for cancelling their shares in SES and SIMEX, members of the two exchanges will receive a fixed dollar amount of shares in Newco. Each SES member will receive $6 million, and each SIMEX member $170,000 for every seat owned and $115,000 for every share owned. In aggregate, SES and SIMEX members will receive $301 million worth of shares. SES and SIMEX members will thus become shareholders of Newco, and Newco will in turn own 100% of SES, SIMEX and SCCS. The remaining shares of Newco will be placed with new investors. The share placement will be implemented in two steps: First, Newco will issue new shares to a pre-designated special-purpose company. The special-purpose company will be a "shell" company owned by Temasek. It will not be able to exercise the voting rights attached to the Newco shares, and will not be allowed to deal in Newco shares without the approval of the Minister in charge of MAS. Second, the special-purpose company will place Newco shares with new investors. The proceeds from the sale of shares, less the par value and certain merger-related expenses, will accrue to the Financial Sector Development Fund. The financial advisor to the Pro-Tem Committee (which is Merrill Lynch) will establish a market value for Newco shares based on a book-building process. The special-purpose company will, however, not place out all the Newco shares in one placement. It is intended that the first placement to local and international financial institutions, as well as other investors, will be completed by Transfer Date. The special-purpose company will hold back a portion of Newco shares for subsequent placements, including to strategic partners with whom the integrated exchange may enter into alliances. Newco will not be publicly listed immediately. The PTC envisages an IPO in the medium term. When Newco is listed on the stock exchange, the Bill will provide that MAS will directly regulate the listing and trading of Newco's shares. This will ensure that Newco will not face a conflict of interest when it lists on its own subsidiary. New Regulatory Provisions Governing Newco The second part of the Bill establishes regulatory provisions which govern Newco. The exchanges are a key part of Singapore's financial sector infrastructure. MAS currently regulates the SES and SIMEX under the Securities Industry Act ("SIA") and the Futures Trading Act ("FTA"). Since Newco will own and run the exchanges, it is in Singapore's strategic interest for MAS to also exercise some degree of regulatory control over Newco. The Securities Industry Act and Futures Trading Act will continue to apply to Newco's two subsidiaries, SES and SIMEX, with minor modifications which I will mention later. We should not unduly constrain the new for-profit entity in the running of its exchanges and the pursuit of new business opportunities. The regulatory provisions pertaining to Newco give MAS power to issue directives in the interest of ensuring fair and orderly securities and futures markets, and the proper management of systemic risks. This is necessary for MAS to perform its role as securities regulator, but is otherwise not intended to impinge on Newco's capacity to make business decisions. The Bill also creates an avenue of appeal by Newco to the High Court against any MAS action. This is consonant with the broader recommendation of the Corporate Finance Committee to allow parties aggrieved by decisions of the securities regulator to have recourse to independent bodies. The first directives that MAS will issue to Newco relate to its corporate governance. MAS will require Newco to do the following: First, to seek MAS approval for the appointments of both the Chairman and CEO of the exchange. These are key appointment holders who define the strategic direction of the organisation, and its key risk management principles. Second, MAS will require Newco to set up a Nominating Committee, whose purpose is to recommend appointments to the Board and key management positions. The appointment of all members of the Nominating Committee will require MAS approval. It is common for international exchanges to have such a Nominating Committee. In Singapore, we have just introduced a similar arrangement for the local banks. Third, MAS approval will be required for individual shareholdings that exceed 5%. MAS may approve shareholdings exceeding 5% subject to conditions, such as requiring further approvals for subsequent increases in shareholding above specified limits. The 5% limit on individual shareholdings prevents excessive ownership by any one party without the regulator's knowledge. Its objective is similar to limits imposed on other demutualised exchanges such as the Australian Stock Exchange. One consequence of these measures is that it will not be necessary to cap foreign investment in Newco. These regulations will remain in the Exchanges (Demutualisation and Merger) Act until MAS review of securities legislation is complete in 12 to 18 months time. The provisions for the regulation of Newco could then be migrated into new legislation. MAS is currently undertaking a review of the structure of securities legislation, to follow-up on recommendations made by the Corporate Finance Committee ("CFC"). It will study the feasibility of integrating the current securities and futures trading legislation into one Act. Establishment of the Financial Sector Development Fund The third part of the Bill establishes a new Financial Sector Development Fund ("Fund") under the purview of MAS. I had announced the establishment of the Fund last year in November as part of the scheme to demutualise the two exchanges. The Fund will be the receptacle for the proceeds from the sale of Newco shares to new investors, and monies in the Fund will be ploughed back into the financial sector. The Bill defines clearly the objectives of the Fund. The monies in the Fund will be used, amongst other things, to develop and upgrade skills and expertise required by the capital markets and other components of the financial sector; support educational and research institutions and R&D programmes, and fund development of infrastructure and projects that support the financial sector in Singapore. The Fund will be administered by the MAS, and its activities will be reported annually in the MAS Annual Report. MAS will announce details in due course. Amendments to the Securities Industry and Futures Trading Acts The final part of the Bill contains consequential amendments to the Securities Industry and Futures Trading Acts arising from the demutualisation and merger of the exchanges. All references to "member" companies have been adjusted to reflect the separation of ownership and membership. The definition of "securities" in the Securities Industry Act is also being expanded to include new instruments such as stock index futures. This will clarify that such new instruments are allowed to be offered and traded on the new exchange. Question proposed.

Mr Speaker, Sir, I fully support this Bill. As the Deputy Prime Minister has said, this Bill will be beneficial to Singapore. The restructuring and merger of SES, SIMEX and SCCS will help the merged entity to become a premier exchange in Asia and make Singapore a hub for financial markets in the region. The trend worldwide is towards the merger of exchanges, as the Deputy Prime Minister has said. We find ourselves in an increasingly competitive environment. We have to compete not only with the other exchanges in the region but also against the major financial centres around the world. Therefore, creativity and product innovations will enable the integrated Singapore Exchange to stay in line with competition. As I understand it, the creation of a single integrated privately-held company through the merger of SIMEX and SES will be completed by end 1999. Then the open access of both SES and SIMEX to qualified foreign investors and financial institutions will take place within three years by January 2002. This will coincide with the freeing of SES commissions. The initial public offering (IPO) of the merged holding company may occur within five years. Since the proposed demutualisation and merger will be very beneficial to Singapore, I would like to ask the Deputy Prime Minister whether he would consider speeding up the process, assuming the various parts of the merger exercise progress expeditiously and smoothly and ahead of schedule. Waiting three to five years for the entire process to run its full course appears to be a long time. Since the said result will strengthen our pole position as a top financial centre in this region, it would be worthwhile to hasten the process. Moreover, the freeing of the commissions of transactions on the SES will benefit the ordinary investors, especially the small retailers. Of course, the speed of implementation depends on our ability to find suitable management for the merged entity and conduct training for the staff and executives of the merged exchange. Sir, I would now like to refer to clause 13 of the Bill which pertains to the regulatory functions of the merged exchange. I would like to ask the Deputy Prime Minister how he intends to separate the regulatory functions of this merged entity with its other interests. As the entity will eventually be listed, it will have profit oriented objectives. Hence, if the integrated entity were to be responsible for some of its regulatory functions, areas of conflict of interest may arise. The Deputy Prime Minister has said that the new exchange will continue to perform routine regulatory functions, like listing approvals and market surveillance. I am concerned that even such regulatory functions may on occasions be at conflict with the financial interest of the exchange. As in the case of the corporatisation of the Singapore Telecom, the Public Utilities Board and others, when they were corporatised, the Government set up separate bodies to undertake their regulatory functions. In this instance, therefore, I wish to know whether the integrated exchange will continue to be a self-regulatory body over the long term, or that the Government intends to ultimately take over all the regulatory functions of this exchange. I think this is important as the exchange will be listed in about five years' time. The interests of the shareholders, the broking houses, the management and the public may not coincide. Hence, I feel that an independent regulatory agency separate from the exchange should play the overseeing and arbitration role. Sir, this merger is one of the recommendations of the Committee on Governance of Exchanges. The Government has accepted or agreed to study many of the recommendations of the Committee. I would like to take this opportunity to ask the Deputy Prime Minister whether the MAS is ready to disclose the results of their study of the various recommendations, and what are the further changes, if any, to be expected of good corporate governance practices or additional disclosure requirements of listed companies on the SES. I now refer to clause 10 of the Bill which governs the proceeds from the sale of shares of the holding company. According to press reports, the proceeds from the opening of the new exchange to more new investors could amount to between $350 million and $380 million. The proceeds are a large sum of money which should be put into a Financial Sector Development Fund. The stated usage is for training and upgrading of the financial industry. This amount of money seems quite substantial. I wish to enquire whether the Government wishes to, besides having the MAS being involved in the management of the funds, allow other fund managers; or perhaps allow some involvement of the exchange in giving its views as to how the funds can be used. And if these funds are ultimately not being fully utilised, would the Government consider putting it to other uses, or putting it into the Government Consolidated Fund? Sir, I wish to conclude by stating once again that I support the Bill. The questions that I have asked are to seek further clarity on the functions and the related issues on the exchange.

Mr Speaker, Sir, thank you for giving me this opportunity. Sir, I rise to support the Bill moved by the Deputy Prime Minister. I wish to make some observations. The merger of the three entities that has been outlined by DPM is to be welcomed if we are going to play a major role in the financial market. Thanks to SingTel and to Government policy, we have got the most shareholders in the region, and I would also declare my interest that I am also a shareholder of some listed companies. It is very important to have an exchange that is forward-looking and I am glad the Minister pointed out the example of Australia and even Hongkong. However, I would like to be much more nearer home, Sir. I would urge the Stock Exchange, when it is merged, to try to educate the public, because there is this lack of knowledge of how the Stock Exchange works in Singapore, and everybody who has got some spare money wants to make quick bucks, and their money goes into shares. I am not going to say that the Stock Exchange should prohibit people from being speculative, but I hope that some sort of public education will do us some good. In the same vein, I would like to urge the banks in Singapore to take heed of this Bill, that if the banks were to play an important role in this country, they should try to think of merging as fast as possible. Otherwise, we will be behind time. Another area which I am a little disturbed in this Bill is clause 17. Clause 17 of the Bill deals with the question of jurisdiction of the District Court. As hon. Members are aware, if a man is convicted in a District Court, his right to appeal lies only to the High Court and no more. He cannot go to the Court of Appeal without the leave of the Court of Appeal. But if the matter is tried in High Court, he has got a chance in the High Court with one judge; and then in the Court of Appeal with three judges. In view of the seriousness of the issues involved, I hope, if not now, at least in future, the Government will consider this position that the High Court should be the proper forum to hear criminal cases. Sir, with this observation, I am more than glad to support the Bill, and I think it is a timely Bill. In fact, when I was in Sydney some months back, I never thought that it would be so soon, but it has in fact come to this House, and I support this Bill.

Mr Speaker, Sir, Mr Leong Horn Kee has asked whether the Government will consider speeding up liberalisation of brokerage commissions. Indeed, the timeframe for liberalisation of commissions is being reviewed by the Financial Centre Advisory Group which we set up with private sector participants, and MAS itself is also studying this issue. A number of factors need to be taken into account, for example, the schedule of liberalisation of commissions may need to be dovetailed with the timing of various other regulatory changes affecting brokers. It is a very swift moving industry. Events are happening around the world, and if we are 12 months late, we may be out of the game. So we may well have to revise the schedule. But there will be other parts of the plan which also would have to be dovetailed as well. As for the regulatory functions to ensure that shareholders are properly protected, the merged exchange will be in a different position than, say, SingTel or Singapore Power, because SingTel and Singapore Power came out of statutory boards which both used to regulate as well as to operate. TAS used to regulate and operate the Telecoms industry and PUB used to regulate and operate the utilities industry (water, electricity and gas). When they corporatised, they had to be split and their functions were divided up into the regulatory part and the operating part. In the case of the Stock Exchange and the Futures Exchange, MAS has always been the ultimate regulator. We have always had oversight, and we will continue to have oversight and regulate the two exchanges as well as the holding company after their merger and demutualisation. The exchanges themselves will always have to do a certain amount of policing of their own rules, but that is at a different level, and MAS will always be in an over-watching position. We have to maintain a balance between being hands-on and controlling everything and standing back and letting things run perhaps in the wrong direction. We have to be not hands-on but in a position to put things right, if necessary. And that is what MAS will do. On the Corporate Finance Committee, indeed, they made a large number of recommendations which we have been following up, and we have made progress in many of these. I think MAS will be putting up an update soon within a few weeks to keep the public posted as to the progress of the work so far. Finally, on the Financial Sector Development Fund, what should the money be used for and can we take views on how to spend it? As Members will know, there is never any shortage of suggestions on how money should be spent. In this case, we will certainly take ideas not just from the Stock Exchange but from the industry and the Financial Sector Advisory Group. The purposes have been spelt out very broadly in the Bill - to promote the financial industry and the infrastructure and training - and I think there will be many worthwhile avenues to which the money can be applied. Of course, what is done, we will report annually to Parliament in the MAS' Annual Report. Mr Shriniwas Rai asked why issues should not be raised in the High Court when there are appeals against decisions of Newco, whether these should not be heard at the High Court with an avenue of appeal to three judges at the Court of Appeal, rather than be heard in a District Court and appeal only to the High Court. It is a matter of how you want to balance the judicial system and where you want to put the prerogatives and the powers of the different levels of the Courts. It is our judgement, and I think also the Attorney-General's Chambers, that the offences can be dealt with by the District Judges because they have sufficient expertise, skills and experience to do so, and the offences do not attract capital punishment or life imprisonment. But at a more fundamental level, there is an appeal allowed directly to the High Court, because if MAS issues a directive to Newco and Newco is aggrieved by this directive, Newco can appeal to the High Court, and the High Court will judge the matter. And if the High Court rules against Newco, there is nothing to prevent further appeal to the Court of Appeal, which is very important, because it will mean that MAS' directives would need to stand up to High Court's scrutiny.

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. - [BG Lee Hsien Loong]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Order for Second Reading read. 2.30 pm

Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Bill seeks to amend the Goods and Services Tax Act to give legislative effect to a new scheme announced in the FY99 Budget, the Approved Contract Manufacturer and Trader (ACMT) Scheme. Rationale I have announced the ACMT scheme in the 1999 Budget to address the GST burden faced by some contract manufacturers whose businesses are substantially with overseas clients. The increasing complexity of business transactions has caused GST problems for some contract manufacturers. Instead of exporting the finished goods to their overseas clients, contract manufacturers are increasingly also being asked by their overseas clients to deliver the finished goods to the overseas clients' customers in Singapore. This local delivery is considered a taxable supply under our GST law. In instances where the overseas clients who own the finished goods do not want to designate an agent in Singapore to account for the GST on their behalf, the contract manufacturers might end up having to bear the GST on local delivery and have no recourse to claim it back. This GST burden makes our contract manufacturers less competitive internationally. Under the ACMT scheme, the local delivery of the finished goods by the approved person to the customers of the overseas clients and the fees for the value-added activities on the goods will be deemed to be outside the scope of GST and GST will not be chargeable. Instead, the overseas client's local customers who purchase and receive the goods in Singapore will account for GST. The scheme is also made available to other traders who engage in value-added activities substantially for overseas clients and face the same GST problem as the contract manufacturers on their local deliveries. Proposed Amendments The Bill makes the following amendments to the Goods and Services Tax Act: (a) Amendment of section 12(8) to allow regulations to be made with respect to the time of supply for the purposes of the recipient accounting for the output tax; (b) Amendment of section 20(2) to allow the approved contract manufacturer or trader to be able to claim credit for input tax attributable to supplies made by him; and (c) Introduction of a new section 37A relating to the ACMT scheme such that local supplies made by the approved contract manufacturer or trader on behalf of an overseas client shall be free of GST and the recipient of the goods would be required to account and pay GST for the goods as if he had himself supplied them. The new section 37A also enables the Minister to make regulations relating to the implementation details of the scheme. 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. - [Dr Richard Hu Tsu Tau]. Bill considered in Committee; reported without amendment; read a Third time and passed.

Order for Second Reading read. The Minister of State for Communications and Information Technology (Dr John Chen Seow Phun): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time." The Public Transport Council (PTC) was formed on 28th August 1987 with the enactment of the PTC Act. The Council approves and regulates bus routes and public transport fares, balancing the interests of the commuters with that of the public transport operators. The PTC Act has not been amended since its enactment. Over the years, various developments have taken place, such as the deregulation of taxi fares last September and the expansion of types of bus services such as shuttle bus services between private housing estates and the nearby MRT stations. The Ministry and the Council have, therefore, reviewed the PTC Act and are proposing to amend the Act to: (a) bring it up to date with latest developments; (b) increase the Council's size to widen its representation; and (c) facilitate the Council's discharge of its functions more efficiently. Let me explain these amendments in greater detail. First of all, we propose to include a new section 24 in the Act to empower the Council to exempt any person or class of persons from all or any of the provision of the Act or regulations made. This amendment will give the Council more flexibility in the application of its decisions and operations. For instance, the Council has deregulated taxi fares from 1st September 1998, hence this new section will enable the Council to regularise the policy and exempt taxi operators from requiring the Council's approval for any taxi fare revisions. Next, we are proposing to amend paragraph 1 of the First Schedule to increase the number of Council members who are not representatives of public transport companies by two, from nine to 11. This is to allow the Ministry to widen the representation of public members on the Council so that other key segments of the population may be represented on the Council. This will allow the Council to take into account the views of a wider segment of population in its deliberations. The remaining amendments, mainly in sections 5, 12, 13, 19, 21 to 23 and 25, are to regularise the various functions and to enable the Council to carry out its role more effectively. Section 5 is amended to be consistent with other statutes on appointing and employing officers, employees and agents to carry out its functions. In addition, new sections 5A and 5B have been drawn up to provide members, officers and employees of the Council and persons acting under the directions of the Council protection from personal liability for functions undertaken in good faith under the Act. Likewise, it is proposed that all members, officers and employees of the Council be deemed to be public servants within the meaning of the Penal Code. These amendments will make the Act consistent with other statutes where all employees of statutory boards are deemed as public officers. It will formally give explicit powers and protection to PTC officers. Section 12 is amended to allow security deposits collected for the issuance of bus service licences to be made to the Council instead of the Accountant-General. Sections 13 and 19 are consequential amendments arising from the amendment to Section 12. Currently, the security deposits are held in the Accountant-General's account. To enable the Council to carry out its functions more efficiently, it is better for the Council to hold these deposits in trust. The amendment in section 21 is to provide for the procedures and requirements for the application of public transport fare revisions to be clearly spelt out. Sir, currently, paragraph 4(3) of the Second Schedule requires the Minister to present the audited financial statements and auditors' report to Parliament. The amendment in section 22 is to include this in the main Act. Section 23 empowers the Council to compound any offences committed under the Act. This is not provided for in the current Act. This amendment will give the Council more flexibility to take action against public transport operators or commuters who flout the rules set by the Council. Section 25 contains the provisions of the existing section 22 and further empowers the Council to make regulations necessary or expedient for carrying out the provisions of the PTC Act. For instance, the Council may prescribe the procedures for application of bus service licences and fees payable and other procedures pertaining to the hearing of appeals, the powers and duties of officers, etc. My Ministry has also taken the opportunity to update the provisions on financial and auditing matters in the Second Schedule of the Act to bring them in conformity with standard provisions of the Government which had changed over the years. Sir, I beg to move. Question proposed.

Sir, I speak in support of this Amendment Bill. I have, in general, no questions about the main items relating to this Amendment Bill. But there is one clause 11 which refers to section 21 of the principal Act which I am a little bit concerned. It concerns the application for the approval of fares. Under this proposed amendment, this application for the approval of fares should be supported by documents, including certified copies of the balance sheet and profit and loss account, and any auditor's report, relating to the applicant's undertaking as the Council may require. And in considering such applications, it is written in the Bill that the Council shall take into account the need of the applicant to remain financially viable as well as the need of the public interest. I want to ask the Minister to consider the possibility that there should be some efficiency criteria to be built into this kind of application to review or increase bus fares or public transport fares. The reason is that these are public charter monopolies in a sense. Proposals to raise fares in public bus companies or public transport companies can be made of course provided they are justified. The justification of it is not necessarily just on balance sheet or profit and loss account, but of course the need of the public. But there should be also efficiency critieria. How do our public transport companies, in discharging its functions and answering to the public, match themselves against other such public transport companies in delivering such services worldwide? With this benchmark, at least we know that such fare increases are justified and not just based on balance sheet and profit and loss account alone. I hope the Minister will consider this point and raise it with the PTC.

Mr Speaker, Sir, as mentioned by the Minister of State, the Public Transport Council is set up by an Act of Parliament in order to be a watchdog body to look after the public interest where public transport is concerned without detriment to the financial viability of public transport operators. I would like to bring to the attention of the House three features of the Public Transport Council. First, the Council is meant to approve and regulate bus routes and bus, taxi and MRT fares. This is a laudable objective. However, the First Schedule of the Bill provides for representatives of the major public transport companies to sit on the Council as members. I would like to ask the Minister of State whether the Council finds difficulties in carrying out its responsibility in being a watchdog body in regulating public transport fares and routes when the very operators themselves are members. Is there no conflict of interest? Would it not be more appropriate for the Council to be independent of the public transport operators since it is meant to regulate them? How does it regulate itself because the public transport operators are themselves members? Furthermore, if, in addition, in the event of a fare increase, supposing that the public transport operators would have to provide their financial data and you have other public transport operators also in the Council sitting at the table, how then can proper deliberation be done because these are private financial data belonging to a private operator? So I am a bit puzzled by this particular clause in the First Schedule and I would like to ask for clarification from the Minister of State. In addition, since the Bill seeks to increase the Council size, can the Council not make it a point to include at least one representative of the handicapped as a member in order to represent them? Second, assessment of applications for fare increase and changes in bus routes requires a thorough understanding of both the demand and supply of public transport, as well as the financial operation of the public transport companies in order to assess the financial implications for the companies concerned. I therefore support the new section 21 which gives the Council powers to ask for supporting documents such as profit and loss accounts to support an application for the change of fare. In addition, I believe that in the event of an application to increase fares, the Council should perform an independent assessment of its implications, both for the public as well as for the operators concerned. It should not merely rely on the analysis provided by the operators themselves. I would therefore like to seek an assurance from the Minister of State that an independent assessment is indeed made by the Public Transport Council before a fare increase is agreed to. I would also like to seek clarification from the Minister of State as to the resources that the Council has to do this detailed and complicated work and whether this is done by the six staff at present comprising the Council secretariat. After all, unlike other regulatory agencies such as the Singapore Broadcasting Authority or the Telecommunications Authority of Singapore, the Public Transport Council is not a statutory board but a part-time council, comprising at present 13 members representing all walks of life. I also presume that this kind of analysis is not done by the Land Transport Authority as the Council's annual report states that the LTA acts as the agent for the Council in carrying out its operational decisions. I would like to seek clarification with the Minister of State regarding the relationship between the Council on the one hand, and the Ministry on the other. I am sure that close consultation occurs between the Council and the Ministry. After all, I believe that the Minister appoints members to the Council. My question is: can the Council make decisions independently and if necessary, contrary to that of the Ministry's? Is it an independent body from that of the Ministry? I support Mr Chay Wai Chuen's point that he made just now that the need for financial viability should not be the only criterion for assessing fare increases. I think his point about including an efficiency criterion is a very good one because in all that I know of the way the Government handles private companies, financial viability has not been a major criterion for assessing an issue which is of public concern. Third, since public transport has a direct impact on the lives of Singaporeans, there is a keen interest in the decisions of the Council with regard to fare revisions, changes in bus routes and so on. The new section 22 states the Council should submit an annual report to the Minister which should be subsequently presented to Parliament. The annual report provides useful information regarding the work of the Council in the preceding year. I therefore support this new clause. In addition, however, in the interest of providing the public with information and the reasoning behind the decisions taken by the Council, I would like to suggest that the Council goes beyond the publication of an annual report. The Council should, soon after making a major decision such as approving a fare revision, hold a public forum to explain to the public the rationale for its decision. I am sure that there are good reasons for its decision and such a face-to-face dialogue with the public would help clarify doubts and concerns. This forum should also be open to the media so that the subsequent discussions, which would include answers to frequently asked questions that many of the public may have, would be covered and publicised. In conclusion, I support the motion, but I would like to seek clarification from the Minister of State regarding a number of points.

Mr Speaker, Sir, the Public Transport Council is doing a lot of work. In fact, our transport services, both the buses and MRT, have improved by leaps and bounds. But I would urge the Minister of State to take note of some of the areas which I am going to address to him. First of all, I agree that there should be a handicapped representative. Most of the Council members are car users. We should get a bus commuter to sit on the Council. I know we have an NTUC representative but it is not enough. The second point, which Dr Lee has mentioned, is to have a feedback unit. The bus and MRT are a very important part of our industry. The passengers are the best people to give feedback on the changes of routes and fares. On the fares, Sir, I share the concern of Members. The Council has members from MRT and bus operators and they are going to decide how much fares should be charged, subject to the Minister's approval. We should be more transparent. Whenever decisions are taken, there should be a convention that those who are involved directly in the operation of the bus or MRT should not take part when a decision is taken to raise fares. We should make it a point to see that these people do not vote. Otherwise, we will lose our maxim that justice must not only be done but seen to be done. The other point which I would like to comment is this. I think the regulatory power that is given to the Council is laudable. It should be because after all, the Council is in charge and clause 25 has laid down all the areas which it has to do and I welcome it. Another point which I would like to mention is the composition of offences. Why do we restrict ourselves to $200 for a fine? Instead of coming back to this House again, what we could have done is to state $200 or such a figure as the Minister may approve. That would save us the trouble of coming to this House, because $200 is a pittance if you really want to regulate some of the offences. My final point is to have a feedback where the public at large, the users of public transport, can give its views and the Council could study them and serve the public better. With that reservation, Sir, I support this Bill.

Mr Speaker, Sir, I too rise in support of the Bill. By and large, ever since the Public Transport Council was established, I believe the public transportation system in Singapore has been operating very well. Fares have been quite reasonable even though from time to time, I have spoken in this House regarding the lack of service in my constituency but by and large, things are going very well. But I think the Public Transport Council was established at a time when the public service providers are very distinctly classified - taxi operator, bus operator, MRT operator and so on. As we look into the future, we already understand from the LTA that the future operators will be different. The bus and rail will be merged and the geographic areas will be partitioned and competition will perhaps be restricted whereas performance measures will be slightly different. My question to the Minister of State is that, in the future regime, how would PTC play its role, or whether its role would be changed because of the new public transport scenario.

Sir, allow me to say a few words regarding the amendment Bill. I agree and support the amendments that are proposed. But there are a few issues that we need to address. The other changes that are to be introduced are going to make commuting more efficient and to allow for greater input by commuters themselves. That is a basic question that needs to be addressed. Are the changes to the composition of members to the PTC going to be a better check to upgrade and improve the work of the public transport system? If that is the case, then the amendments are worth its salt. Otherwise, I do not think it is going to be worth its salt if no changes are going to be made and the interests of the commuters are not going to be taken into consideration. I support the viewpoint raised by the GPC Chairman for Communications. He has got a few valid points and I think it is worth looking at. But what I would like to say is that there is a need to ensure that a balance be maintained between operators and commuters. I know it is a difficult task. One has to ensure that public transport remains viable but there is obviously an interest to ensure that there is no run away price increase. In order that the interest of commuters is looked into, there is a need to increase the number of people from nine to 11. Why nine to 11? Why not 15? That is the basic question. What type of representations are you going to have? These members basically have not even taken a bus ride at all, and I think quite a majority of PTC members are not bus commuters. They are people who live in ivory towers. One needs to examine and see that there is adequate input. If that is the objective of the Public Transport Council, you have to bring in inputs of commuters to ensure the quality and efficiency are maintained. You may argue that all this is at a price. I agree that there is a price to be paid but not at the expense of the commuters. There is also a need for PTC to ensure that there is adequate audit of the different services offered by the companies, and at the moment there is a duopoly. Only two major companies, other than SMRT, are providing the service at the moment. I think it is timely that PTC allows for greater competition. There is a need to re-look at the current bus transportation system provided by the two companies alone. Perhaps, one should look at the possibility of introducing more changes for ordinary travelling commuters, at the new town level, particularly the feeder bus system. And if more competition can be brought in, there is a possibility of improving the services provided by the different companies. I am sure that the Minister of State would agree with me that the more competition we have in public transport, we may be able to increase efficiency and allow the commuters to have a wider choice. With that proviso, it is very important that representation on the PTC be re-looked at and a wider representation of commuters be brought into the PTC. The idea is to allow for better inputs and to bring public transport to a greater height.

Sir, there is another point which I forgot to mention.

Mr Rai, you have already made your speech.

Could I just add one point that I have left out?

I am sorry. Mr Jeyaretnam.

Mr Speaker, Sir, I do not propose to speak on any particular amendment. But I do wish to bring up a few points which have already been raised. I do not wish to repeat what has been said. But I think a valid point that has been made is the over representation on the Council by people who run the transport service and people who do not travel on public transport. I do not know how you are going to remedy this imbalance. One way may be to form an association of commuters, encourage all over the island associations of commuters and then ask them to delegate somebody on to the Public Transport Council to look after their views. Alternatively, may I suggest that the Government consider appointing an Opposition Member of Parliament on to the Council. An hon. Member: NCMP?

Please do not laugh at this. I am saying it quite seriously. In one of the earlier motions that I moved in this House in 1997, I had proposed an all party parliamentary committee, ie, including Opposition Members and the Government Members, to review any increases in prices for basic services - transport, utilities and other basic services - that are provided for our people. That, of course, was rejected. It could not have been passed. But would the Government now consider seriously setting up an all party parliamentary committee, consisting of Members from the Government and the Opposition, to consider any applications from the operators for increase in fares? They can then make their recommendations to the Council. You may perhaps think that the Council should not be bound by it, but at least they will have the views of people who have been elected by the people, and they can take them seriously. That is my suggestion for enlarging this Council, to try and find a way to allow commuters to have representation on the Council. The second point that I wish to put forward is the holding of a public inquiry when any operator or operators decide to withdraw any particular service. In other countries, when an operator plans or announces that he is going to withdraw the services, and if there is an objection from people who are served by that service, the Minister then appoints an inspector to hold a public inquiry to listen to the objections and decide whether the service should be withdrawn or not. Can we not move along those lines, instead of always having Government appointed people on councils? Let us give our people a greater participation in how things are run in this country. That is the whole idea of democracy. So, I would ask the Ministry to consider these two proposals quite seriously, and not just dismiss them as coming from the Opposition.

Mr Speaker, Sir, first, I would like to thank all the Members for their support, comments and suggestions. Let me, first, take the question on representation. I think many Members expressed opinions on representation and asked whether there is a conflict of interest when we appoint representatives from the public transport companies on to the Council. Sir, I would like to draw Members' attention to the Act itself which we enacted in 1987. In section 21, we explicitly listed the objectives of the Council. Specifically, for fare adjustments, (a) the need for the applicant to remain financially viable; and (b) the need for public interest to be safeguarded. I believe the reason why we specifically included the two provisions in the Act is to send a very strong signal, because if a public transport operator is not viable, then we are going to have degradation of service and there would be very severe implications on the public transport service. Arising from that, in the First Schedule, we also listed the composition of members of the PTC. There are two provisions there. The first is the appointment of representatives from the public transport companies, and the second is from the other sectors of the population. The reason for appointing public transport representatives on the Council is to allow them to also voice their own interest. That is the intent of the Act when we first enacted it in 1987. This is the way for the PTC to balance the interest of commuters against the financial viability of the operators. And if Members look at the numbers on the Council, we have four representatives from the public transport companies at the moment. And we have nine members who represent the other sectors of the population. As it is, you will find that the majority are from the other sectors of the population, like the grassroots organisations, unions, community leaders, academia, professionals and so on. So the public transport representatives are there, as I said, to represent their interests and to provide inputs to the PTC on their operations and financial situation, and to justify in front of the majority of the Council members who represent public interest any proposal for fare or route adjustment. Sir, the Council takes into account views from all interested parties. This arrangement promotes consensus building among its members, and has worked well over the years. In a way, it is not unlike our National Wages Council. I know what Members are thinking of. They are probably thinking that the NWC provides guidelines, whereas the PTC approves fares. But what I am trying to say here is that it allows the different parties to argue their case and then come out with a consensus. Let me inform Members that since the formation of the PTC until today, not a single vote needs to be taken at the PTC's deliberations. It is all by consensus, and I think that is a fantastic testimony of how we work in Singapore, ie, everybody looks at the overall interest of everyone and comes out with a consensus that will serve us well. I thank Dr Wang Kai Yuen for praising our public transport system. I think this is a good arrangement and we should continue with the current practice. I take note of Dr Wang Kai Yuen's point about the evolution of the public transport industry. Yes, we are going into a multi-modal public transport operation. In future, I think it is impossible to get all the public transport operators to be represented on the Council. In my view, we would have a future situation where we have a representation from the operators as a whole, and then we have representation from the rest of the Singapore population. So this is how it is going to evolve. And it is also our intention to continue having the majority of the Council members coming from the other sectors of the population. The GPC Chairman, Mr Chay Wai Chuen, brought up a very important point about the criteria that the PTC takes into account when they decide on approving fares. And in this amendment, we are putting in place, more specifically, the kind of information that the Council will ask from the operators, such as certified copies of balance sheets, profit and loss account, auditor's report and so on. I agree with the GPC Chairman that efficiency is a very important criterion and, indeed, over the years, when they consider applications for fare adjustments, track record, productivity and efficiency have always been taken into consideration. In fact, the reason why we have two instead of one major bus operator is to allow the PTC to also benchmark one against the other, so that the inefficiency of one operator will be shown up by the performance of the other. And, of course, we are always paying attention to overseas bus companies' performance and inefficiency, but, of course, it is not so easy because of the different systems, subsidies and so on and so forth. But the point is well taken and I assure the House that all these criteria are taken into consideration when the PTC approves fare adjustments. Dr Lee asked whether there is independent assessment. Dr Lee is right that a thorough understanding is required in order for the Council to properly assess applications for fare revisions and bus route changes. Hence, the Council does not rely only on the inputs provided by the operators. The Council is also assisted by the Land Transport Authority, which provides independent analysis and technical advice to the Council. If Dr Lee were to look at its Annual Report, it does not say that LTA is an agent to implement operational details only. It says that it also provides technical advice to the PTC. In fact, if you look at the PTC Act, the PTC has the power to appoint agents, and that is a very wide power. An agent includes LTA and any consultant that they want to engage to provide inputs, technical advice and analysis for the Council's deliberations. I would therefore like to assure Members, and Dr Lee in particular, that the Council is given full authority in its deliberations and decisions independent of the Ministry. Dr Lee also suggested that the Council holds public forums to explain the rationale of its major decision, and other Members have also brought up a related point. I would like to explain that it is already a current practice of the Council to hold a press conference to announce major decisions, such as fare revisions, and explain the rationale. The media usually reports this extensively. To my mind, this is more important than holding a public forum involving a few hundred people to explain the policy, because once the new measures are announced and the press reported them widely, Singaporeans too will react and give feedback to the Council. The Council then monitors these public responses closely and provides further clarifications, if necessary. In addition to that, there is an on-going process whereby the Council receives and responds to feedback from the public through forums, like the Feedback Unit, and grassroots organisations. So the feedback is on-going and we also receive a lot of letters from members of the public, either to the Ministry or the PTC, and the Ministry will channel them to the PTC for their consideration. So this feedback mechanism is in place and it is an on-going process. Members commented that perhaps many of the PTC members are motorists and not bus commuters. Let me remind Members that, as far as possible, we will involve people who can contribute, but I do not think it is a prerequisite for PTC members to be commuters before they can become members. I would like to remind Members that all of us are motorists and yet we are here commenting on public transport. How is it? It is because we take the trouble to talk to our residents, our friends, our grassroots leaders, and we get feedback and we are genuinely concerned. We can put up a very credible argument. So I do not think Members can say that just because most of the PTC members are motorists they are therefore not doing their job. Let me inform Members that I know that PTC members, including the Chairman, take the trouble sometimes to go and test out the public transport system. In our review to expand more members and have a wider representation, we can try to include more people, as suggested by Members, but let me explain to Members that they have to bear in mind what I have said earlier. As for the suggestion that the handicapped be represented, we will look into it. Mr Rai commented that the composition fine of $200 is too low. If he looks at the current Act, there is no composition fine in the current Act. If a person commits an offence, the Act actually allows PTC to bring him to court and if the court fines him guilty, then he will be fined up to $1,000 or six months' jail or both. So the composition fine is to provide that flexibility so that, for fare evasion, you can exercise flexibility. A fine of $200 is in line with some of the composition fines that we have in other Acts. So it is not too low. In addition to that, in the amendment Bill, we also provide for the Council to make regulations and prescribe fines up to $1,000 for different offences. So the flexibility is also there. It is sufficient for this composition fine to be $200. Dr Vasoo talks about audits and competition. Yes, every year the Public Transport Council audits the service standards of the public transport operators. The PTC has specified the standard of service in terms of frequency and the length of bus route because it does not want the route to be too long. Every year, they do audits to make sure that the bus service standards are within those specified. As for competition, I would like to remind the House that our public transport market is a very small one and we lack the critical mass to allow free and unbridled competition in this sector, as we had experienced in the 1970s where we had 11 private bus companies competing with one another and the result was chaos and badly maintained buses and a poor level of service. But that is not to say we are not interested in competition. In fact, as I have said, the competition is there in terms of benchmarking. In addition to that, for peak hours where the existing bus companies have got problems in meeting the high demand, we allow the Scheme B service to compete with the bus operators. This has also worked well. If any Member or any company or member of the public feels that there is a need for such supplementary services in other routes and areas, he can put up a case and the PTC will be happy to consider them. In the longer run, as I have mentioned earlier, the public transport industry is being restructured into a multi-modal one. As far as we can see, we are going to have two multi-modal operators by the year 2002. When the industry structure has become more established and stabilised, and if there is room for more competition, we will consider introducing new players. Finally, I come to Mr Jeyaretnam's comments. Again, he brought up old issues. He wants an All-Party Parliamentary Committee to review and recommend price increases, including bus fare increases. Let me remind the Member that his proposal was debated in the House and it was rejected.

Why?

Because we do not think the House is the right forum to do that. These are matters that we think should be left to the Ministry, the statutory boards and the Council to do. We do not think this is something that the House should do. As for a public inquiry to look into the proposal of, say, withdrawal of services, and so on, again this is the role of the PTC. Whether it is an addition of services or withdrawal of services, the PTC is tasked to look into all these proposals and decide. I do not think we should have a public inquiry just to do this. If we conduct a public inquiry, maybe we would never move, and that is detrimental to the development of the public transport industry in Singapore. So I will not support his suggestion. In conclusion, I would just like to say that the Council's task of balancing commuters' interests versus those of the public transport operators is not easy. It has so far discharged its responsibilities, in my view, fairly and effectively in accordance with its charter. The proposed amendments would enable the Council to discharge its responsibilities even more effectively. With that, I thank all the Members for their support.

By way of clarification, may I ask the Minister of State, on his statement that the Public Transport Council looks into any proposal to withdraw any particular service, whether the Council invites the people who are served by that service to send in their representations? Does the Council call them up and listen to their grievances? May we have an answer to that?

The Public Transport Council gathers all the information, including feedback from MPs, grassroots organisations and bus operators. Again, it is a consideration involving all interested parties. So I do not see anything wrong with that.

You are not answering the question.

The Minister of State, in his detailed reply, for which I thank him, stated that the public transport operators sit on the Council in order to voice their own interest. I would like to seek clarification from the Minister of State regarding the following related aspects: (1) Can the public transport operators not represent their own interest by extensive discussions with the members, but not sit on the Council? (2) The Minister of State likened the PTC to the NWC. The NWC is involved in wage negotiations and discussions among the parties concerned. It is not a watchdog body where wage negotiation is concerned. (3) Hence, my third point is, therefore, that the PTC is not really a watchdog body, as mentioned in the annual report. It is a Council to deliberate on fare revisions and matters pertaining to public transport. If so, I can see why public transport operators sit on the Council. But in that sense, I think further and subsequent annual reports should exclude and refrain from having this particular description of the Council.

I think Dr Lee has not understood my point. I said "in a way PTC is not unlike the NWC". What I meant is the consensus part. We know that NWC works on consensus. I was on the NWC Council before and the Chairman always said, "Look, it is always by consensus that we come to the final recommendation." What I am saying is that there are important advantages of having the public transport operators sitting on the PTC. It is not just for them to advocate their own interest, but also to provide opinions on matters concerning the industry. I understand her point that we can always invite them to sit in and ask them questions. But I do not think that is quite the same as members sitting around the table, discussing throughout the whole session, offering their opinions, and when one transport operator proposes something, the other transport operator will be there also to criticise. I think there are advantages in doing that. I just want to clarify that that is what I meant when I said that the consensus and the result are quite like the NWC where we actually have this close relationship between the employers and the unions.

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

Mr Speaker, Sir, I beg to move, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed additional reclamation by the Government of the foreshore and seabed at Sentosa Cove containing an area of about 9.7 ha as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 3/99', which is deposited in the Land Office, Singapore. Sir, Parliament at its sitting on 9th November 1990 approved the reclamation of about 69 hectares of foreshore and seabed between Sentosa and Buran Darat (now known as Sentosa Cove). This reclamation has been completed. The Ministry of Trade and Industry proposes to reclaim an additional 9.7 ha of foreshore and seabed. This is shown coloured pink on the plan marked as "Land Office Reclamation Plan No 3/1999". A copy of this plan is displayed in the Library of this House for the reference of hon. Members. The proposed reclamation will bring the total development area for Sentosa Cove to 116.5 ha. Upon completion of the reclamation, the land will be used for recreational and residential development. The additional area to be reclaimed allows for optimisation of the development mix and will yield an additional 150 housing units. The overall profitability of the project will be improved with the provision of high-value housing units fronting the sea. It will take 27 months from the date of approval to complete the project. The Sentosa Development Corporation, as agent of the Government, will undertake the reclamation. Sir, I beg to move.

Question put, and agreed to. Resolved, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed additional reclamation by the Government of the foreshore and seabed at Sentosa Cove containing an area of about 9.7 ha as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 3/99', which is deposited in the Land Office, Singapore.

Mr Speaker, Sir, I beg to move, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed reclamation by the Government of the foreshore and seabed (Stage 4A and 4B) south and west of Jurong Island Stage 3B containing an area of about 550 hectares as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 4/99', which is deposited in the Land Office, Singapore. Sir, Government in 1991 approved the concept plan for the amalgamation by reclamation of the 7 southern islands, namely Pulau Sakra, Pulau Pesek Kechil, Pulau Merlimau, Pulau Ayer Chawan, Pulau Ayer Merbau, Pulau Pesek and Pulau Seraya which are used by existing oil refining, petrochemical and chemical companies to form Jurong Island for industrial use. On completion of the amalgamation and reclamation of the foreshore and seabed around the 7 islands, Jurong Island would have a total area of 3,000 hectares. The whole amalgamation process of the Jurong Island was to be implemented under 4 separate reclamation stages. To date, the reclamation of Jurong Island has been substantially completed. The infrastructural development has commenced and is on schedule to meet the needs of investors. The last stage of reclamation under Stage 3B is in progress and is scheduled to complete by end 2001. MTI, with the recommendation of Jurong Town Corporation (JTC), now proposes to reclaim approximately 550 hectares of the foreshore and seabed in Stage 4. This is shown coloured pink on the plan marked "LAND OFFICE RECLAMATION PLAN 4/99", a copy of which is displayed in the Library of this House for the reference of hon. Members. The reclamation would yield land to overcome the current shortage and meet future needs at Jurong Island with the expected expansion of the petrochemical hub in the next 10 years. This would also enable the development of a Chemical Park and a Chemical Logistics Hub that would allow for more efficient management of hazardous materials. The JTC will be appointed as agent of the Government to oversee the reclamation works. The reclamation works will commence in the 2nd Quarter of 2000 and will be completed by the end of 2003. Sir, I beg to move.

Question put, and agreed to. Resolved, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed reclamation by the Government of the foreshore and seabed (Stage 4A and 4B) south and west of Jurong Island Stage 3B containing an area of about 550 hectares as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 4/99', which is deposited in the Land Office, Singapore.

Mr Speaker, Sir, I beg to move, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed additional reclamation by the Government of approximately 1,908 ha of foreshore and seabed south of Tuas View as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 5/99', which is deposited in the Land Office, Singapore. Sir, Parliament at its sitting on 27th February 1996 approved the reclama- tion of about 372.6 hectares of foreshore and seabed at Tuas View to meet the increasing demand for industrial land in Singapore. The reclamation work is now in progress and is expected to be completed by the 4th Quarter of 1999. This land has been committed for general, pharmaceutical and utilities use and will be taken up almost immediately upon completion of the reclamation. It is recognized that the industrial land on the mainland could run out as early as year 2001/2002. As such, there is an urgent need to create more land by reclaiming Tuas View Extension to build up the supply of industrial land. Jurong Town Corporation proposes to reclaim additional land south of Tuas View as shown coloured pink on the plan marked "LAND OFFICE RECLAMATION PLAN NO 5/99", a copy of which is displayed in the Library of this House for the reference of hon. Members. The proposed reclamation will yield an additional 1,908 hectares of land for industrial development and also for the siting of four major utilities, namely, a desalination plant, a wastewater treatment plant, an incineration plant and a power station. The Jurong Town Corporation will be appointed as agent of the Government to oversee the reclamation works. The reclamation works will commence in the 2nd Quarter 2000 and will be completed by end of 2006. Sir, I beg to move.

Question put, and agreed to. Resolved, That this Parliament, in accordance with Section 4 of the Foreshores Act (Cap 113) approves the proposed additional reclamation by the Government of approximately 1,908 ha of foreshore and seabed south of Tuas View as shown coloured pink on the plan marked 'LAND OFFICE RECLAMATION PLAN NO 5/99', which is deposited in the Land Office, Singapore.

Resolved, "That, at its rising today, Parliament do stand adjourned to Tuesday, 17th August 1999." - [Dr Lee Boon Yang].

Mr Speaker, Sir, I beg to move, That Parliament do now adjourn. Question proposed.

3.36 pm

Mr Speaker, Sir, why is it that this PAP Government, which wastes no opportunity of boasting how learned its Ministers and its leaders are, and how gifted they are in leading the country, finds it so difficult to learn an essential truth. To learn the lesson that for the growth of a country economically, politically and socially, there is a place for dissent. That it is absolutely essential that constitutional dissent, lawful dissent, should be allowed and be even encouraged, if the country is to move forward.

Developed countries have recognised this long years ago. And countries which are developing are beginning to learn this lesson. Countries with autocratic rulers are learning that they cannot keep out constitutional lawful dissent of its people, and they learn it sometimes at great cost to themselves. This has happened in a number of African countries. It has happened not very long ago in this part of the world when President Suharto, the former President of Indonesia, had to learn that he could not keep dissent out and had to give way to the people's demands for their voices to be heard. But this PAP Government stubbornly refuses to recognise the lesson. There was a time, of course, when it held sway completely in this House from 1965 or so, to 1981, without any room for dissent, and during that time it perhaps suffered the opposition outside Parliament. But after 31st October 1981, when dissent found a place in this House, they have clamped down on any attempt for dissent, for democracy to grow in this country. One of the measures that had previously been used was, of course, the arrest of political leaders, detaining them, scaring them from taking part in politics, and keeping them away from any thoughts of offering themselves as candidates for a party other than the PAP to this House. But that, of course, was not the only method. The PAP knows that a political party cannot function if it is starved of funds. And so it uses this weapon very effectively. Right from the beginning, there was this climate of fear brought about by the deliberate policies of the Government that kept people from contributing to Opposition political parties. The PAP themselves, of course, have no problems. They have only got to ask and they will get their donations. But the people in Singapore were scared into giving anything for the Opposition parties. And the PAP found that very effective, and so the result is that the Opposition parties find it a struggle, an uphill battle to try and maintain any form of dissent to further their calls for democracy in this country. And so this continues, and has continued for the last 50 years. May I explain - I have not got very much time, Mr Deputy Speaker, Sir - what I am saying by reference to a particular case. After the recent judgment in the High Court ordering the Workers' Party to pay a substantial sum in damages and costs to a group of 11 plaintiffs, which included a PAP Member of Parliament, the Executive Council decided that it would appeal to the public for help to keep the Party continue with its struggle, because there was a threat to wind up the Party. Council took the decision to apply for a licence under the House to House and Street Collections Act. Mr Deputy Speaker, Sir, I have handed to the Clerk copies of the correspondence that has passed between the Party and the Police, and I would ask that it be distributed to those Members present, so that they may have sight of the correspondence that has passed. [Copies of correspondence distributed to hon. Members.] We pointed out to the Police - there should be four letters, I think - that the Executive Council had taken the decision as a result of that judgment, and we asked whether we may have a licence to make an appeal. We took this decision as a result of two previous attempts, of which time does not permit me to go into in great deal but I will speak a bit later about them. So we wrote, "Will you give us a licence to make an appeal?" There was an immediate reply asking how did we propose to do it. We said that we would like a licence to be able to appeal over a period of time, and not just one day as in the case of Flag Days given to associations, and we said we propose to station perhaps one or two members in prominent places to receive any donations that the public may wish to give. After some five weeks or so came the reply from the police that no licence could be granted to us under the House to House and Street Collections Act. The reason is apparently that it can only be granted to a worthy charitable cause. Nowhere in the Act does it say that a licence can only be granted to a worthy charitable cause. So we wrote back to the police asking to be shown where the Act restricted the grant of licences to only worthy charitable causes. We also asked the police to tell us under which of the grounds specified in section 4 of the Act a licence was refused, because there are specific grounds under which a licence may be refused. And, finally, we asked whether our request had been sent to the Minister and whether it was his decision or whether it was the decision of the police officer concerned. That letter was written about three weeks ago and we have not heard any reply, although I asked for an immediate reply. We asked for this licence, Mr Deputy Speaker, Sir, because, as I said, of two previous attempts. We first attempted to put out a leaflet for appeal when the Party's accounts were put into the receiver's hands by an ex-PAP Member of Parliament and we asked for the funds to be sent right to the official receiver, not to us. We were not soliciting in the streets. We were prosecuted for it. And sad to say, we were convicted, and appealed. The appeal was dismissed. We do not agree with that decision but that is the decision of the court. So there was that instance. Another instance was when we made an appeal for help for the Secretary-General of the Party to meet certain judgements that had been made against him in suits brought against the Secretary-General. We had an account opened and asked for funds to be sent direct to that account. Again, we were not standing in the streets or going round from house to house to collect the monies. The police swooped in after a period of time, seized the monies, closed the account and said we could not appeal without their licence. Hence, the decision of the Executive Council. So now, we have applied and we have not heard. I am asking in this House now for the Minister - I hope the Minister is replying - to give categorical answers to four questions. We do not want any "ifs" and "buts". We want a plain answer "yes" or "no". We want to know, first of all, why is it that no licence can be granted to us under the House to House and Street Collections Act. Was it his decision that the Workers' Party should not be given any licence? Or was it just the decision of the police officer? And why have we not had a reply to that question? May I point out that, under the Act, the Minister has the power to exempt any person, including organisations or societies, from the provisions of the Act. Should he not consider exempting the Workers' Party from the provisions of this Act for this particular purpose? Any democratic government, conscious of its duty to the people to provide a place for dissent and the growth of democracy, would exempt a political party making an appeal from any law preventing it. In the United Kingdom, for the last two years, political parties with representation in Parliament receive annual grants. We are not asking for annual grants. We are asking for a licence to collect lawfully and peacefully any contributions that the public may wish to give to us without any fear or worry. The second assurance I want from the Minister here is, if he thinks no licence should be granted under the House to House and Street Collections Act, will he give a categorical assurance in this House that the police will not interfere if the Workers' Party made an appeal to the public, I repeat, not standing in the streets and collecting the money but an appeal to the public to send whatever they wish to the account of the Party or to hand it in to an appointed official of the Party. And together with that, an assurance from this House to Singaporeans that they are free to make any contribution or donation towards the Workers' Party. So I would like answers to these questions. As I said, may we have clear, unequivocal answers, not an answer that is clouded by "ifs" and "buts" and "qualifications". We want a clear "Yes, we will grant you a licence, or we will not grant you a licence. But you may proceed to make an appeal provided you do not stand in the streets or do not go from house to house." We do not intend to do that, because the House to House and Street Collections Act forbids standing in the streets and collecting money or going from house to house because of any pressure that may be brought. We wish to make an appeal and those who are moved to give may send their donations to the Party. So may we have the clear assurances from the Minister?

Mr Deputy Speaker, Sir, Mr Jeyaretnam makes a mountain out of a molehill. He spends about 10 minutes introducing the subject, talking about a wide range of matters on fear and whatnot which had all been dealt with in the House. Then with the remaining time he has, he complains that the police has not replied to his latest letter regarding whether or not his Party could raise funds in the manner he had asked. In fact, no formal application has been made by the Party. This exchange started when the Workers' Party requested information from the police. Despite that, the police very graciously replied to the queries and I am told that the police has in fact sent out their latest reply. Perhaps, it has not reached him yet. So it is not a question of delay. It is only two weeks.

May I ask, by way of clarification, when was it sent out because I have not seen it yet?

I understand from the police that they sent out the reply today.

Today! Thank you.

Two weeks from the time he wrote, ie, 20th July - the Public Entertainment Licensing Unit (PELU) issues 3,000 permits and applications a month - and even then not through a formal application but through an exchange of letters. That is the first point. Let us see it in context. Mr Jeyaretnam jumps the gun because the police has not replied yet. In fact, the police has been engaging him in a series of correspondence which I will ask the Clerk of Parliament to distribute [Copies of correspondence distributed to hon. Members.].

Again, by way of clarification, may I ask the Minister of State whether he has read our letter. We asked if a formal application has to be made, would the Licensing Officer please let us know or send us the form, and we will make it. Have the police sent us an application form?

Whatever it is, the point is there has been no formal application.

Have you sent us?

Order. Mr Jeyaretnam, I will not allow any more clarification. I will allow the Minister his 10 minutes.

The point I am trying to say is that there was an exchange of letters between the police and Mr Jeyaretnam which is still ongoing. Police has furnished the latest reply which is now before the House. But Mr Jeyaretnam jumps the gun and raises this motion in this House. Perhaps, he is indeed anxious because, as he said just now, he was convicted under the House to House and Street Collections Act in 1983, when he was fined. Let me just reply substantively to his points, having cleared the procedural matters because it is not as cynical as Mr Jeyaretnam makes it out to be. Police has replied and the reply is before the House. Police position is very clear in that a licence under the House to House and Street Collections Act is required if an organisation wishes to solicit funds from the public by means of visits from house to house or soliciting in the streets or other public places. Police issues licences when such soliciting of funds is for charitable causes or worthy community projects. Let me give some examples. Examples will include flag day collections for the Salvation Army, Children's Cancer Foundation, Walk-A-Jog donations for the National Council Against Drug Abuse, Singapore National Stroke Association, or Breast Cancer Foundation and for humanitarian aid collection, for example, by the Red Cross for Indonesia. All these licensees are charities registered with the Commissioner of Charities, or organisations with tax exempt status given by the IRAS, or members and affiliates of the National Council of Social Services. A licence will not be issued under the Act for collections that are for personal gain or political funding. Surely, the Workers' Party's intention to collect funds to pay damages incurred for defaming others can neither be considered a charitable cause or worthy community project. Public charity should not be exploited to underwrite criminal or civil penalties arising from one's wrongdoing. This approach is based, as the letter says, on section 4(4) of the Act. Section 44(4)(f) specifies that the Commissioner of Police may, in his discretion, refuse to grant a licence if it appears to him that the purpose of the collection is objectionable on grounds of public policy. It is objectionable on grounds of public policy that a political party, whether ruling or opposition, because the law is applied equally and fairly across the board, be issued a licence to collect funds in a public place. Let me explain why. The Police's professional view is that its policy of restricting the issuance of licences to charitable causes and worthy community projects should not be widened. Doing so will open the floodgates for other individuals or groups to apply to make collections for a whole host of causes. I am sure Singaporeans will agree with this approach. What are the public policy considerations? Police does not want the proliferation of public solicitation of funds as it can constitute a public nuisance. For example, it does not want to see a situation where pedestrians, including tourists, are constantly accosted along Orchard Road by those seeking funds for a whole host of causes. I am sure the Singapore Tourism Board ---

May I by way of clarification ---

No more clarification for you.

All right.

I am sure the Singapore Tourism Board shares this view. In fact, a proliferation of such public solicitations would not just amount to a public nuisance but may even lead to frayed tempers caused by persistent hassling or harassment. All kinds of groups going door to door to solicit contributions for a whole host of causes cannot be any better. In public places, this is all the more so when political parties are concerned. People of different political persuasions may be approached or pestered or urged to contribute. There may be hackling or quarrelling, all in public view. The situation may then escalate and others join in. There will then be public disorder. I think the Police legitimately, being concerned that people should not engage in being a public nuisance or there being public disorder, disallows such applications. But this is the second point. This answers Mr Jeyaretnam's first question. This does not mean that political parties cannot raise funds. There are other ways they can do this. For example, they can raise funds through a private collection from party members, supporters, well-wishers and friends. Or they can hold fund-raising dinners. Indeed, they can make public appeals provided that there are no visits from house to house or soliciting on the streets.

I thought I made that clear.

Or in public places. The point is, as for the Worker's Party, we are assuming that there are Singaporeans willing to donate to the party to help it pay its cost. He asked for an assurance from this House that Singaporeans can contribute. I think it is not for the House to give an assurance. It is for the party, if it thinks it can get Singaporeans who want to contribute to its cause, to make its case and the public, I am sure, will examine the party on its record. Indeed, I understand that there is even an appeal on the Internet by somebody who may very well be a Worker's Party member appealing for funds for the party with the address and account number given. In fact, up to now, there is no law against donations to political parties. But in the UK, for example, a draft Bill has been put before the UK Parliament which restricts donations to political parties. The restrictions include a ban on foreign donations requiring donations of 5,000 pounds or more to be made public and banning anonymous donations of 50 pounds or more. UK is tightening up in this area, even running before us. The bottomline really is that Singaporeans abhor money politics. This healthy attitude is because the PAP Government took a strong stand against it from the outset. Unlike other countries, the Government scrupulously avoided travelling down this path. We have explained our approach before. The Senior Minister, when he was Prime Minister in 1989, spelt out three cardinal rules to keep money politics out of Singapore. These are, firstly, observe strict legal limits on election expenses, hence our cap of $2.50 per voter for single constituencies and $2.50 per voter divided by the total number of candidates for GRCs in a parliamentary election. Secondly, donations should never be made to individual Ministers or MPs, but to the party. And thirdly, political contributions must never become a means of buying influence or swaying Government policies. Hence, we have stood firm by these three tenets which have served us well. What about foreign donations? Indeed, a case can be made to prohibit political parties from receiving funds from foreign sources. This is the position in many countries, such as Taiwan and South Korea. As I said earlier, the UK which currently allows foreign funding is re-considering its position. Prohibiting foreign funding of political parties would help prevent foreign influence and lobbying in the political arena. Foreign organisations and individuals who provide funding for political party may try to influence politics in Singapore. Some of these organisations or individuals may be fronts for foreign countries which want to see a party with a friendlier stance towards their country come into power in Singapore. In addition, some foreign organisations may, by channelling funds to political parties here, promote their causes which are incompatible with the unique make-up of our society.

Order. The time allowed for this debate has expired.

May I say something by way of reply?

There is no provision for you to reply. The Question having been proposed at twenty four minutes to Four o'clock pm and the Debate having continued for half an hour, Mr Deputy Speaker adjourned the House without Question put, pursuant to Standing Order. Adjourned accordingly at Six Minutes past Four o'clock pm to Tuesday, 17th August, 1999.

asked the Minister for Education if he will consider making changes in the education system only after a comprehensive plan has been drawn up instead of regular tweaking of the system which can cause confusion and concern.

The fundamental objectives of our education system are to develop the individual and mould the citizen. These objectives have not changed. But from time to time, as the environment changes, it is necessary to re-visit our strategies and programmes, to ensure that the education system continues to meet the needs of Singapore society and economy.

During the Committee of Supply debates on the budget estimates for the Ministry of Education in this House in 1997, 1998 and in 1999 just a few months ago, I have laid out the direction in which our education strategies and programmes need to move. MOE has adopted an ability-driven strategic paradigm for education and is re-orientating the education system to this strategic paradigm. The changes which have been put in place or announced recently, for example, the IT Masterplan, National Education, the emphasis on creative thinking, the new university admission system, the quality assurance approach to school appraisal, the curriculum and mother tongue language reviews, the review of the teacher-training system (amongst others) all tie in with our aims to develop and harness the talents and abilities of Singaporeans.

I have outlined the rationale for and the inter-connections among these initiatives in my speeches at the Committee of Supply debate in 1997 and 1998 and again this year. I thank the Members of this House, including the Nominated Member of Parliament, for having contributed their views and ideas during the extensive debates we have had on education. Indeed, a number of these initiatives have been implemented only after extensive consultations, for example, over more than a year for the new University Admission System.

The direction that we are moving in is clear. And the major initiatives needed to operationalise the strategies and translate them into action plans have also been laid out. These are already being implemented. I assure the Nominated Member of Parliament that MOE works closely with our higher education institutions and schools to ensure that our plans and programmes are well thought out and smoothly implemented.

asked the Minister for National Development what are the reasons for the policy to disallow all applicants classified as "Upgraders" to purchase 3-room flats directly from the Housing and Development Board.

Currently, HDB does not offer new 3-room flats to flat buyers. It buys 3-room flats from the open market and sells them at subsidised prices to low-income first-timer families with household income not exceeding $1,500 per month. The sale of 3-room buy-back flats is one of many HDB schemes to help low-income families own HDB flats.

Upgraders have already enjoyed one subsidised flat. They should therefore not compete with first-timers for a 3-room flat from HDB. They can buy a 3-room flat from the open market with the sale proceeds obtained from the sale of their existing flats.

asked the Minister for Communications and Information Technology whether he will consider introducing regulations to require parental consent before teenagers are allowed to subscribe to telecommunication services such as those for handphones and pagers.

As Members are aware, we have liberalised the paging and mobile telephone services markets for the benefit of consumers. The liberalisation means that the service providers are free to make commercial decisions such as how to market to and service the different market niches. These service providers are aware that there are legal safeguards to protect minors who enter into commercial contracts, and that signing on minors without parental consent may render such contracts voidable in law. The service providers must therefore be prepared to bear this business risk if they decide to enter into contracts with minors.

asked the Minister for Health if there exists sufficient recourse for doctors or measures to check any abuse of power by the Medical Council prior to the commencement of an inquiry process.

Presently, there are sufficient safeguards to enable doctors and complainants to challenge the decision of the Medical Council prior to the commencement of a formal inquiry.

The Medical Registration Act requires that all complaints lodged with the Medical Council concerning doctors' professional conduct and fitness to practise to be processed by a Complaints Committee of the Medical Council. The Committee comprises four members - two Council members, one other doctor and a lay person. It will obtain a written explanation from the doctor concerned and other relevant documents such as medical records.

After examining all the facts and evidence available, the Complaints Committee will either dismiss the complaint, issue a letter of advice or warning to the doctor concerned, or refer the complaint for a formal inquiry. The doctor and the complainant will be notified of the decision of the Complaints Committee.

For any decision made by a Complaints Committee that does not involve referring the complaint for a formal inquiry, such as issuing a letter of warning, the doctor and complainant can appeal to the Minister within 30 days from the date of the notice. When the Minister receives an appeal, he will review the proceedings of the Complaints Committee, after which, he could uphold or reverse the order made by the Complaints Committee, or make other orders as he deems fit.

For any complaint that is referred for formal inquiry by a Disciplinary Committee appointed by the Medical Council, if the doctor believes that the Complaints Committee has acted unfairly or unreasonably, he could apply for a judicial review. The proceedings and decision of the Complaints Committee would then be examined by the High Court.

asked the Minister for Manpower what initiatives are proposed by his Ministry in preparing and training our workforce to face the challenges of the transformation of Singapore into a knowledge-based economy.

The Government has been working in close partnership with employers and unions over the last several years to implement initiatives in worker training and upgrading.

The Skills Redevelopment Programme (SRP) to equip less-educated workers with certifiable skills has been making good progress since it was launched in December 1996. To date, more than 14,000 workers have either completed training or are currently undergoing training. The labour movement has been gearing up for the challenge put to it by the Prime Minister in his May Day Rally speech this year, to train 100,000 workers under the SRP by May Day in year 2003. Over the next few months, the SRP for several new sectors will be launched.

The Government is fully committed to supporting the SRP. We have so far allocated a total of $100 million to the programme. This is supplemented by another $50 million set aside by the Skills Development Fund for the SRP. In addition, a Skills Development Centre costing $20 million has been established to increase the training capacity under the SRP.

We also supported initiatives such as the NTUC Education and Training Fund (N-ETF), launched in October 1998. The Government has provided a grant of $12 million to the NTUC to match funds of $4 million that the labour movement has raised. NTUC has reported that the Fund has received very good response. More than 10,600 union members have benefited from training support, already exceeding NTUC's initial target of training 10,000 workers in the first year of operation.

The Government's support for these programmes demonstrates the urgency we are placing on redeveloping the skills of our workforce for the knowledge economy. We intend to build on the foundation laid by the SRP and other programmes to evolve a comprehensive system for manpower development and lifelong learning.

The need for workers to become lifelong learners in order to remain employable in the knowledge economy has been the key area of attention in the Manpower 21 study effort launched by my Ministry in June last year. Manpower 21 will serve as the blueprint for Singapore's manpower development into the 21st century. Extensive consultations were held with industry, union and community leaders to formulate the recommendations. Initiatives to promote and support lifelong learning will form the cornerstone of the Manpower 21 plan.

The work of the Manpower 21 Committees has now been completed and the Report will be released to the public later this month. My Ministry will then provide details on the specific initiatives to be implemented.

asked the Minister for Manpower what is the compensation that has been (or will be) given to the workers who were injured during the collapse of Compassvale Primary School, and whether there are regulations regarding the amount of compensation for injured foreign workers.

My Ministry has received workmen's compensation accident reports for 7 workers injured during the Compassvale collapse and are processing their claims under the Workmen's Compensation Act. My officers are investigating into the 7th case where the employer has yet to report the accident.

All the workers injured in this case were construction workers. They are "workmen" and are entitled to compensation under the Workmen's Compensation Act

The Workmen's Compensation Act treats local and foreign workers alike. Foreign workers enjoy equal protection and are entitled to the same compensation as local workers.

Out of the 7 foreign workers whose accident reports have been received, 3 suffered minor injuries. Their medical expenses would be borne by their employers and they would receive full wages for the period of medical leave. For the remaining cases where the injuries were more severe, my Ministry is awaiting the final medical reports to determine the extent of disability suffered by the workers. If the workers are confirmed to have suffered some disability, they would in addition, be entitled to lump sum payments for the permanent disability.

Where a worker is totally incapacitated, the minimum compensation payable under the Act is $49,000.00 and the maximum is $147,000.

00. The amount of permanent incapacity compensation payable in each case will vary depending on the severity of the injury, the age of the worker and his average monthly earnings.

asked the Minister for Home Affairs whether he will establish rehabilitation programmes for those persons, who have committed an offence punishable with imprisonment for a term which may extend to 7 years and who have maintained a criminal-free record for 10 years, with a view of expunging their names from the Criminal Investigation Department's criminal records and of making it easier for them to obtain employment.

It is necessary to keep criminal records for all serious offences. These records are used by the Courts for consideration in sentencing. They are also useful in facilitating police investigations. Police do not disclose criminal records to employers, except for jobs that have public safety and security implications.

The Prisons Department already has in place a range of rehabilitative measures to help prisoners re-integrate into society upon their release, when it matters most. Vocational training and academic programmes are available to prisoners to help them develop good work ethics and acquire relevant skills that would help them secure jobs after their release. Ex-prisoners who have difficulties in obtaining employment can approach the Singapore Corporation of Rehabilitative Enterprises (SCORE) for assistance. SCORE has tied up with a number of companies that are prepared to employ ex-prisoners and would assist them in finding a job with one of these companies.

Ultimately, it is the companies which decide whether to employ any person.

asked the Minister for Law how many writs of summons were issued in 1997 and 1998 in relation to copyright and patent infringement.

Based on the data from the Supreme Court's computer database, 11 writs were filed in 1997 and 48 writs were filed in 1998 for copyright infringement, whilst 1writ was filed in 1997 and 3 writs were filed in 1998 for patent infringement.

asked the Minister for Foreign Affairs how will the meetings of the ASEAN Ministers and the ASEAN Regional Forum contribute to the prospects for peace and economic recovery in the region.

The recent meetings of the Foreign Ministers of ASEAN and Dialogue Partners saw a candid and substantive exchange of views on a variety of issues, including sensitive subjects like good governance, human rights and recent developments in the South China Sea, Korean Peninsular and Kargil.

As regards the ASEAN Ministerial Meeting, the highlight was the Minister's Retreat. At the Retreat, we brainstormed the challenges facing ASEAN against the backdrop of the regional economic crisis and an expanded membership. One of the concrete outcomes that emerged from this self-appraisal process was the unanimous endorsement of PM's proposal for an ASEAN Joint Roadshow.

The ASEAN Joint Roadshow will collectively market ASEAN to the major economies in North America, East Asia and Europe as an attractive investment destination. We hope to get the first Roadshow out before the end of this year. By pooling our resources and working closely together on this project, ASEAN will send an important message to the world that it is resolute, effective and united.

The meetings that took place in Singapore last month were essentially meetings of Foreign Ministers, not Economic Ministers. Hence, we did not directly discuss specific aspects about the regional economy, although we reaffirmed our commitment to remain open, market-oriented and plugged into the global economy.

Unlike last year, there was a strong mood of optimism among ASEAN and the Dialogue Partners at the recent ASEAN meetings that countries in the region had turned the corner. At the same time, they were realistic and recognised that reforms must be on track and protectionist tendencies should be resisted.

It is clear, however, that peace and stability in Southeast Asia and the wider Asia-Pacific is the essential foundation for economic growth and recovery. ASEAN's essential purpose is to manage diversity and differences in Southeast Asia within a cooperative framework. We are a very heterogeneous region and the potential for conflict is never absent. Disputes and potential flashpoints have to be carefully managed to ensure that tensions do not escalate.

With this in mind, ASEAN Ministers met Dialogue Partners at the ARF and Post-Ministerial Conferences and reviewed common security concerns in the context of the broader implications for regional peace and stability. In this connection, ASEAN reaffirmed the need for a Regional Code of Conduct in the South China Sea. The ASEAN Working Group on ZOPFAN and SEANWFZ has been tasked to elaborate the document.

I was encouraged by the fact that there was a candid exchange of views even on difficult and sensitive issues. This shows that the ARF has made progress and the comfort level achieved by the ARF Ministers has increased over the past six years. At the same time, the Foreign Ministers also recognised that the ARF process must continue to progress in order to remain relevant. To facilitate the evolution from Confidence Building Measures to Preventive Diplomacy, Singapore, on behalf of ASEAN, is preparing a paper on the concept and principles of Preventive Diplomacy for further discussion in the next inter-sessional year.

asked the Minister for Foreign Affairs whether the recent visit by the Malaysian Foreign Affairs Minister has brought about a better chance for Singapore and Malaysia to resolve outstanding bilateral issues, including the Customs, Immigration and Quarantine, water supply and Central Limit Order Book issues.

The visit of the Malaysian Foreign Minister Datuk Seri Syed Hamid was an introductory visit in keeping with the tradition of new ASEAN foreign ministers visiting their counterparts. We reaffirmed the importance of maintaining good bilateral relations and noted that both countries should remain focused on the long-term relationship and benefits of mutual cooperation. We also agreed that both sides should press on with negotiations on the package of outstanding bilateral issues.

However, we did not engage in detailed discussions on specific issues during Datuk Seri Syed Hamid's visit. This is because negotiations are currently ongoing at the senior officials' level. They have already had three rounds of discussions, and will probably meet again later this month in Kuala Lumpur. Datuk Seri Syed Hamid and I agreed that the officials on both sides should try to narrow the gaps on the issues, so as to arrive at a "win-win" package deal. In this regard, he also noted that as our Prime Ministers had agreed on the broad framework for resolving the issues, both sides must translate this into reality. I share his view on this.

asked the Minister for Information and the Arts what are the current efforts made by his Ministry to preserve the rich and diverse cultural and historical heritage of our different ethnic communities and whether his Ministry will implement any financial assistance/grants and incentive schemes to encourage greater participation of private organisations and voluntary sectors in these efforts.

MITA preserves and promotes our ethnic heritage through programmes organised by the National Heritage Board (NHB), the Preservation of Monuments Board (PMB) and the National Arts Council (NAC).

NHB, for instance, has given curatorial advice on the Chinese Heritage Centre's flagship exhibition "From Segregation to Integration: The Story of the Chinese Overseas". NHB is currently providing secretariat and curatorial support to the proposed Malay Heritage Centre. It is also advising the Singapore Chinese Chamber of Commerce and Industry on its thematic exhibitions at the Sun Yat Sen Memorial Hall.

Similarly, NAC has been actively promoting local cultural activities through outreach programmes such as "Concert in the Park" and in the Singapore Arts Festival. For this year's Festival, the ethnic groups that were featured include Singapore Indian Orchestra and Choir, Gunong Sayang Association and Sriwana.

Many of the agencies' activities are made possible through partnership with private and public organisations. The Civic District Trail - Singapore's first permanent heritage trail to be launched at the end of this month - is one such example. Though spearheaded by NHB, this project involves the community at large. The trail takes visitors through many historic sites and preserved buildings within the Civic District, reflecting our multi-racial and multi-religious heritage.

NAC has been supporting the various arts groups by providing grants for their activities. These arts groups include Teater Kami, Sriwana, Nrityalaya Aesthetics Society, Singapore Indian Fine Arts Society, Chinese Theatre Circle, Singapore Association of Writers and Chinese Calligraphy Society of Singapore. Likewise, for monument buildings, PMB has been administering the "Tax-Exemption Scheme for Donations to National Monuments" since 1994. The scheme is intended to help the owner, trustee or management committee of a non-profit national monument to raise funds for its restoration. To-date, about $6.5 million of donation funds collected through this scheme have been granted tax-exemption. NAC administers a similar scheme whereby donations to arts groups channelled through NAC qualify for tax exemption. For FY 98 the scheme has attracted some $6.97 million of donation funds.

The Government approved in 1992 matching grants for endowments for the Chinese, Malay, Indian and Eurasian communities to establish their own community-based heritage centres. The Chinese Heritage Centre is in operation. Work on the Malay Heritage Centre is in progress.

asked the Minister for Community Development (a) how many organisations have applied for grants, subsidies or sponsorships from National Youth Council since January 1998 to date, and of these how many were successful; and (b) how many Malay organisations have applied for the said grants, subsidies or sponsorships, and of these how many were successful.

Funding by the National Youth Council for projects organised by youth and youth organisations is drawn from the Youth Development Fund, or YDF in short. YDF is an endowment fund set up by a grant from the Government. The YDF works on the principle of co-funding. That is, NYC will provide only partial funds. This is to encourage youth and youth organisations to obtain corporate or community support for their projects.

Each year, NYC uses interest earnings generated from its YDF deposit accounts to co-fund youth projects. The amount of funds available is determined by the interest yield on the fund. This sets the budget, and ensures that careful use is made of limited funds. With a low interest rate in 1999, there is a smaller budget to fund youth projects. NYC decided to give higher funding priority to youth community service projects. This is in line with the NYC's aim of encouraging youth to be actively involved in the community.

From 1st January 1998 to June 1999, NYC received a total of 455 YDF funding requests. These requests came from about 160 youth organisations. Of these, 335 projects or 73% of the total number of requests were successful.

In the same period, 18 Malay youth organisations applied for funding from YDF for 42 projects. A total of 32 projects or 76% of the total number of funding requests were successful. This success rate is comparable to the overall success rate for funding requests. NYC will continue to promote youth development to corporate and community sponsors. We hope that with their participation and support more funds and resources would be available to support meaningful and promising youth projects.

asked the Minister for Home Affairs whether there is any active monitoring process to prevent pyramid selling from being introduced in a disguised form.

Pyramid selling activities are prohibited under the Multi-Level Marketing and Pyramid Selling (Prohibition) Act. The Police would investigate individual cases on receiving relevant information or complaints. Over the past 3 years, the Police received a yearly average of only 9 complaints of alleged pyramid selling. None of the cases were substantiated. In view of the small number of complaints, and the infrequent nature, the current process is adequate.

asked the Minister for Home Affairs how many foreigners have been granted permanent residence and citizenship respectively since 1995.

A total of about 130,000 and 39,000 people were granted permanent residence and citizenship status respectively from 1995 to June 1999.

asked the Prime Minister if he will consider amending the law to set up a permanent constitutional court comprising a minimum of five judges to be approved by the Chief Justice to hear disputes on constitutional issues.

There is no need for such an amendment.

In the first place, under our constitutional structure and legal system, such disputes have always been decided by the ordinary Courts. The Courts are vested with the power to review the validity of legislation and executive acts on the basis of constitutionality. This is the long-established way in which constitutional disputes are resolved in common law countries.

Secondly, in 1994 the Constitution was amended to provide for the President, acting on advice, to refer any question as to the effect of any provision of the Constitution which has arisen or appears likely to arise, to a tribunal of not less than 3 Judges of the Supreme Court.

This system of settling disputes or questions on constitutional matters is therefore satisfactory and we do not need to change it.

asked the Minister for Law how the compensations for the freehold properties compulsorily acquired for the proposed Bartley Road extension and proposed expansion of the Central Expressway/Braddell Road Interchange were arrived at.

The Bartley Road extension project was gazetted for acquisition on 10th December 1998 and the Central Expressway/Braddell Road Interchange project was gazetted for acquisition on 21st December 1998.

The statutory compensation was arrived at in accordance with the provisions of the Land Acquisition Act. The Act provides that the compensation to land owners should be based on the value of the land as at 1st January 1995 or the date of publication of the declaration for acquisition whichever is the lower. In both these cases, the market value of the properties at the date of gazette was lower than the value at 1st January 1995. Therefore the statutory compensation is based on the market value of the properties at 10th December 1998 and 21st December 1998 respectively, as determined professionally by the Chief Valuer.

As Government's professional valuer, the Chief Valuer assesses the value of a property in accordance with the provisions of the Land Acquisition Act and accepted valuation principles. He takes into account recent sales evidence of similar properties in the vicinity to determine the statutory compensation for the acquired property. He also inspects every property.

In addition to the statutory compensation as provided by the Land Acquisition Act, Government will also grant ex-gratia payment to landowners who face financial hardship arising from the acquisition. They will have to submit their requests to Land Office. A Ministry of Law Appeals Committee will assess the owners' request for ex-gratia payment on a case by case basis. Ex-gratia will be assessed based on the merits of each case.

asked the Minister for Health whether a polyclinic will be built soon in Pasir Ris Town and, if so, when and at which location.

The Ministry will be building a polyclinic in Pasir Ris at the junction of Pasir Ris Drive 1 and Pasir Ris Street 51. The proposed Pasir Ris Polyclinic will be co-located with a Voluntary Welfare Organisation, namely Care of the Elderly Foundation (CEF) Nursing Home. The construction of the proposed Pasir Ris Polyclinic and Nursing Home will commence in early 2000 and is expected to be completed in 2002.

asked the Minister for Education whether his Ministry has any plan to build a secondary school in the Bukit Gombak Constituency and if so, when and at which location.

The Ministry of Education's review of the requirements for secondary schools in the Bukit Batok DGP has shown the need to build one new secondary school in the DGP. I am happy to inform the Member that MOE, together with URA, has identified a suitable site next to the existing Lianhua Primary School at Bukit Batok Street 52, which is within the Bukit Gombak Constituency. The school will be built by the end of 2001.

asked the Minister for Community Development if the People's Association has any plan to promote the ideal of active citizens as outlined in the report by the Singapore 21 Committee.

The ideal of Active Citizens has been an important objective of the People's Association (PA) since its establishment in 1960. PA's mission has been threefold: racial harmony, social cohesion, and communication between the people and the Government.

Active citizen participation in community activities and nation building has been, and will remain, PA's modus operandi. To facilitate this, grassroots organisations (GROs) were formed. In the 1960s, Citizens' Consultative Committees and Community Centre Management Committees were formed at constituency level for local communities to meet the welfare and social needs of their constituents. Since the late 1970s, Residents' Committees were first formed to serve residents in HDB neighbourhoods. Today, about 28,000 are serving as committee members of these GROs. Another 170,000 volunteers are actively engaged in the various activity groups under the GROs. These are fine examples of active citizens.

Certainly we need to, and want to, do better. In 1997, nine Community Development Councils (CDCs) were set up at district level. The CDCs are given more authority and resources to initiate and manage projects. They are given matching grants for funds raised for approved projects. Government Ministries and agencies, such as Ministry of Community Development, the Home Team, the schools, as well as voluntary organisations have organised joint projects with the CDCs. More agencies will join in. Through these joint projects, the agencies bring their services closer to the local communities. The local communities feel greater ownership of the services. More residents would help fellow residents in need through the projects, either as volunteers or donors.

PA will also be helping to form more Neighbourhood Committees (NCs) in private estates. This will promote the active citizen spirit amongst residents in private estates, like RCs have done in the HDB estates.

The CDCs, the NCs, the many GROs, plus their network with Government agencies and voluntary organisations, will give our residents many channels to be active citizens. Emphasis remains community self-help and self-reliance towards a caring, gracious and resilient society. With more channels and greater awareness, more of our citizens will become more active. They will bring in new ideas and new energy, and start up new programmes that bring in even more active citizens. This would become a positive cycle towards the active citizens' ideal.

asked the Deputy Prime Minister if he will give a progress report on the introduction of Islamic banking facility in Singapore and whether his Ministry has any plan to encourage local and foreign banks to provide the facility in order to attract local and foreign deposits.

MAS allows banks in Singapore to offer Islamic banking products and services as part of their banking activities. For example, one of the local banks is offering Al-Wadiah savings and current accounts. There are also unit trusts in the market which are managed in line with Islamic philosophy and laws. The MAS has not received any application from Islamic banks to set up operations in Singapore. We have embarked on a gradual programme of liberalisation, to give foreign banks with strong global track records and sound credit ratings greater access to our domestic market. We would consider applications for banking licences in Singapore by Islamic banks which meet these criteria, as with all other foreign banks.

Our approach is to allow market forces to drive the development of Islamic banking in Singapore. Banks will provide a service where there is adequate demand for it to make commercial sense. That banks are already offering such products and services in the market shows that there is some demand in Singapore for Islamic banking products and services. Market demand will determine the pace at which the range of Islamic banking products and services available in Singapore grows in the future. Table - Breakdown of the 1677 Children not Registered for Admission to P1 after 1997 P1 Registration Exercise (Cols. 1985-1986)