Hansard, 2005-02-28

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: Name From (2005) To (2005) Mr Zainul Abidin Rasheed 20 Feb 25 Feb Mr Tharman Shanmugaratnam 22 Feb 24 Feb Mr Seng Han Thong 26 Feb 27 Feb 12 Mar 16 Mar Mr David T E Lim 27 Feb 06 Mar Ms Indranee Rajah 28 Feb 04 Mar Dr Wang Kai Yuen 28 Feb 28 Feb Prof. S Jayakumar 01 Mar 01 Mar 10 Mar 12 Mar Dr John Chen Seow Phun 02 Mar 05 Mar Mr Lim Hng Kiang 02 Mar 05 Mar Dr Ahmad Mohd Magad 08 Mar 11 Mar Mr Mah Bow Tan 11 Mar 27 Mar Mr Teo Yock Ngee 11 Mar 16 Mar 21 Mar 26 Mar 29 Mar 09 Apr Mrs Lim Hwee Hua 12 Mar 15 Mar Column:733 Dr Lee Boon Yang 13 Mar 19 Mar Dr Mohamad Maliki Bin Osman 23 May 29 May

ABDULLAH TARMUGI Speaker Parliament of Singapore

[Mr Speaker in the Chair]

1. Mr Arthur Fong asked the Deputy Prime Minister and Minister for Law (a) if he will give an account of the case of Mr Yeo Eng Siang, whose appeal came through only after he had served his jail sentence; (b) is this case an aberration; if not, (c) what is the number of such cases over the last 10 years (1995 - 2004); (d) what measures are in place to ensure that there will not be such repeat cases; and (e) will the Government consider compensating Mr Yeo for the hardship he had endured.

Mr Speaker, Sir, this case received much media coverage and the impression given was that there was some serious lapse or travesty of justice. This is not the case, Sir.

First, let me explain briefly the processes before an appeal is heard. When an accused person appeals against his conviction or against asentence, several things must take place before the appeal can be heard.

The judge who convicted the accused would write the grounds of his decision. The accused (or his lawyers) would study

Even in the most efficient of legal systems, this sequence requires time. Indeed, it is in the interests of the accused to have adequate time to decide whether to appeal, to study the detailed grounds of the judge's decision, and to research and prepare arguments before the appeal court.

It is, therefore, neither practical, nor is it in the interests of justice, for the hearing of an appeal to follow the decision to appeal too closely.

Sir, short sentences of imprisonment, for example, of a day, a week or even a few months, may sometimes be shorter than the time required for the necessary processes prior to the hearing of an appeal. In such cases, if an appeal is lodged, it may be heard after the sentence has been completed. Because of this and the costs incurred, appeals against short sentences are rare. But thisis not peculiar to Singapore. It also happens in other jurisdictions with developed rules of procedure.

Now, let me turn to this particular case. Here, he was convicted on 26th November last year andsentenced toseven months' imprisonment. At first blush, this seems to provide ample time for an appeal.

However, he was released two months after being sentenced. This is because the sentence was effectively reduced tofour months and 20 days, to begin from 9th September 2004. Why was that so? Firstly, the court backdated the sentence to commencefrom the date when the accused was first remanded on the charge, and secondly, there was a

Hefiled his notice of appeal on 3rd December 2004. There was a period of about two months between his decision to appeal and the hearing of the appeal on 1st February 2005. This is a reasonable period of time, and there was no delay in the sequence of events that followed the appellant's notice of appeal.

Mr Arthur Fongasked for data over a period of10 years to ascertain if this case is an aberration. I hope that Mr Fong understands when I say I do notthink that I should ask the courts to spend valuable resources to search records over 10 years. But so far as can be ascertained in the time available, there are no records of any similar cases. This is because of the peculiar combination of facts I have outlined. Indeed, out of a total of 233,135 criminal cases heard by the Subordinate Courtslast year, only 71 cases or 0.03% of them were heard by the High Court on appeal.

As for the measures to put in place to prevent such repeat cases, that implies that there was some serious lapse or shortcoming which warrants special measures. This is not the case, Sir.

Let me add that in most cases involving short sentences, the accused may decide not to appeal, or apply for bail pending appeal. The court has the discretion to stay execution on terms thatit deems reasonable, on the application of the accused. What happened here was that the accused did not apply for bail pending appeal.

Finally, the question of compensation does not arise. There was no malicious prosecution as there was more than ample evidence to prosecute him in the first place. There was no delay, let alone

There is no basis for compensation simply because a conviction had been set aside on appeal. As far as I am aware, no country in the world would do so on such terms.

the detailed grounds before filing the formal petition of appeal, and prepare for the hearing. The public prosecutor also needs to study the documents and prepare for the hearing. one-third remission of the sentence on account of good behaviour in prison. Therefore,he served out his sentence and was released on 29th January 2005. inordinate delay, in the process of justice nor was there aflaw in the system.

Sir, I would like to thank the Minister for Law for letting us know that there was no miscarriage of justice in Mr Yeo's case. I also thank him for taking us through the jurisprudential process and the chronology of events that took place.

When the case of Mr Yeo Eng Siang was reported in the newspapers, it created quite a bit of public sympathy for him. Given the response by the Minister for Law, would he feel that the sympathy was misplaced?

Sir, I can only set out the facts which show that there was more to the case than meets the eye. Let me say that we have a clean andefficient criminal justice system in Singapore with tremendous international respect and reputation which concerns all stages - the Police, the courts, the prosecution. If there is any case of miscarriage of justice or serious lapse in the system, we would want to know - the Government, the Chief Justice and the Attorney-General would allwant to know. But I do not think that this is such a case.

Let me also add that the accused person had criminal records going back to 1981. He has been imprisoned several times: in 1981, for theft; 1983, for theft in dwelling house; 1990, theft in dwelling house; 1991, theft; 1992, cheating by personation; 2001, cheating; and 2002, theft. And he had brushes with the law overseas. He has been in prison in the United Kingdom, Taiwan and the United States. He was deported to Singapore by Taiwan in 1986 and deported to

Singapore by the United States in 1990. The United States' Immigration andNaturalisation Service, in a letter, when arranging deportation, said that Yeo took advantage of every person he came into contact with and the story told by everyone he had befriended or had dealings with him, is the same, that he is a compulsive liar and a thief.

The following Question stood in the name of Mdm Ho Geok Choo -

2. To ask the Minister for Health (a) how will portable medical benefits be made eligible to the unemployed; and (b) what measures are available for the unemployed to participate in the MediShield programme.

Question No. 2, Sir.

Sir, MediShield and all the Medisave-approved private medical insurance schemes are individual insurance plans, with the insurance benefits tied to the individuals. For as long as premiums are paid, the policyholders will remain covered by the insurance. But I suppose Mdm Ho Geok Choo is probably referring to employees on corporate group medical insurance plans. Such plans are linked to the employer and not to the individual workers. Their medical insurance benefits will cease upon termination of employment, either through resignation, retirement or retrenchment.

This is a real problem and for years, NTUC has been advocating a solution with the aim to ensure the portability of medical insurance.

Sir, with the reform of MediShield, there is scope for unions, employers and insurers to build upon the MediShield to achieve the portability objective. For example, some employers may decide to help their employees subscribe to MediShield for the basic medical benefits, and top up any enhanced medical benefits with their corporate insurance plans. In this way, the employees will have their individual medical insurance plans, at least at the basic MediShield level, which can survive any sudden change in their employment status, for as long as premiums are paid.

As MediShield premiums can be paid from Medisave, most Singaporeans should find continuing insurance coverage affordable, even if they should be temporarily out of work. That is why it is so important for all Singaporeans, including the self-employed, to contribute regularly to Medisave while they are young, healthy and economically active. It is really saving for a rainy day.

As for non-working Singaporeans, like spouses, parents and children, we hope their working family members will insure for them, using their Medisave to pay for the premiums. We will use all opportunities to remind them to do so, for example, when couples register for marriage, or when parents register the birth of their babies.

3. Dr Tan Sze Wee asked the Minister for Health, in light of the recent announcement to revamp the MediShield system, (a) whether the Medisave and Medifund policies can also be revised in tandem; (b) will there be enough Medisave to cover the increase of deductibles for poorer Singaporeans; and, if not, (c) what will his Ministry do to

ensure that the Medifund or Medisave schemes 'kick in' sooner to tide these groups of Singaporeans over.

Sir, our system of financing hospitalisation cost, comprising large Government subsidy and some co-payment by patients, supplemented by insurance and employer medical benefits, has served us well. It has helped us deliver a high standard of public hospital services which the vast majority of Singaporeans can afford.

The system has evolved over the years. We constantly enhance it in the light of experience, so that it remains effective and relevant to our circumstances.

The current reform of MediShield is part of that evolution. After 1st July, we will have a more robust system of leveraging on insurance to help ease the financial burden on Singaporeans.

Medisave is a key piece in this healthcare financing system. When every Singaporean regularly saves a portion of his income in his Medisave Account, he will over time build up a considerable balance to pay for the hospitalisation needs of himself and his family.

After 20 years, Singaporeans have collectively accumulated a total of $30 billion in their Medisave accounts. The average Medisave balance exceeds $10,000. This is not a small achievement. In another 20 years, when the scheme matures,ie, when every Singaporean would have started contributing to Medisave from the first day he starts working, we would collectively and individually build up sizeable savings for a rainy day.

For the current MediShield reform, almost all patients would have enough Medisave to pay for the increased MediShield deductibles.

For the small minority who are unable to afford their hospital bills, we have Medifund to provide the safety net. As Members are aware, the Government is doubling Medifund to $2 billion, with an immediate injection of $100 million.

Sir, I am glad to hear that, on average, Singaporeans do have an average of about $10,000 in their Medisave account. However, with the increase in deductibles, the amount that is going to be drawn out of Medisave to pay for deductibles would increase over time. Currently now, until over time when savings are increased, it is still a limited pool. I just want to ask a point of clarification.Is there any way in which the Ministry would look into, for example, what happens if, let us say, Medisave runs out? Will that mean there will be more out-of-pocket payments for hospitalisation bills?

Mr Speaker, Sir, I track the health of Medisave regularly. I look at the statistics. Of course, we could not attend to individual accounts because there are so many but, at the macro-level, I look at the various statistics associated with it - median, percentile, and other data. As I said just now, Medisave is a crucial part of our hospitalisation financing system and, without Medisave, one could not even start to begin to solve this problem. That makes Singapore quite unique. I helped to flesh out Medisave 20 years ago, and so I may be a bit biased, but I think Medisave is a very important part of this whole scheme.

We have often heard our colleagues saying that this is a 3M system - Medisave, MediShield and Medifund. I think it is not quite a good label because it shortchanges us. It is not just 3Ms. I prefer to describe it as an SMs financing system. A very big "S" for subsidy,

Yes, with MediShield reform, deductibles go up, but I have been very careful when I set the deductible increases. I have long sessions with NTUC unionists, got their feedback and supported by statistical data. The increase of $500 is very affordable. As I said,most accounts have more than $10,000. You have to look at affordability from the viewpoint of whether you have enough in Medisave. I know where so much of the criticisms that it is unaffordablecome from. It is actually from the self-employed and I worry a lot about the self-employed. When you are young and healthy and still able to drive a taxi or cookchar kway teow, if you do not save, you and your children would get into trouble. Even a small bill of $500, if you have no savings,is huge, but with savings, even if you earn $1,000 a month, you would be saving $7,200 every 10 years, and that is not a small sum.

because we are talking about B2/C class patients here and subsidy is the first line of defence. We subsidise a lot, with Class C up to 80%. So this big "S" followed by several "Ms". I dare not pronounce it as "SMs" in case it gets confused with the other "SMs". So I shall pronounce it as "SMs" and the "Ms" mean Medisave, MediShield and Medifund and, I think, in due course, means testing too, although that is the next question we would be talking about later. This whole financing model makes us unique from the rest of the world and is a great asset which we should preserve, and making sure that Medisave collectively, and individually, remains healthy, is one of the key objectives.

4. Dr Tan Sze Wee asked the Minister for Health, in relation to the recent

MediShield changes, whether his Ministry (a) will consider using the means test as an inducement to Singaporeans not to opt out of the MediShield scheme and (b) plans to use the budgetary savings brought about, in future, by the 'means testing' scheme, to offset the increase in MediShield premiums especially for the older people.

Sir, I thank Dr Tan for his support of means testing. I heard his first speech in this Parliament and I noticed he spent some time talking and supporting this particular idea. He has now suggested that we use means testing to induce Singaporeans to join MediShield. Actually, I am not in a hurry to introduce means testing. My priority this year is to implement the MediShield reformand to ensure that it meets its objective of easing the financial burden of Singaporeans with large hospital bills. Implementation is scheduled for 1st July and I would like to see how the scheme meets the objective before contemplating the next move on means testing. At that point, I would assess the need for Dr Tan'ssuggestion.

As for MediShield, I am confident that given sufficient explanation, Singaporeans would see its value and would not opt out of it. Currently, 9 out of 10 working adults are covered by MediShield or its private sector equivalent. Those who are not covered are minors, children, non-working spouses and employees with generous company sponsored medical benefits. We would, nevertheless, try to encourage them to be insured. For almost all Singaporeans, affordability of MediShield is not a problem. For the small minority who finds it difficult, the Government would help them adjust to the higher premiums. One way is for the Government to top up the Medisave accounts with higher amounts given to older citizens. This could be done when theBudget position allows it, as it was done this year.

5. Mr Zainudin Nordin asked the Minister for Education with the recent announcement concerning university fees hike will (a) the local universities lose their competitive edge against equivalent foreign universities; and (b) the increases in the fees run counter to the efforts to make Singapore an education hub.

Mr Speaker, Sir,NUS and NTU have increased their tuition fees for local students by 5% to S$5,930 for AY2005. SMU, which operates as a private university, has increased its fees by 15% to S$6,500. Foreign students pay 10% higher fees than local students.Even with these fee increases, we believe that our local universities' tuition fees remain competitive in relation to other comparable countries. In the US and Australia, for example, fees for public universities are in the region of S$8,000 for domestic students and S$22,000 for international students. Private universities charge substantially higher fees, with fees of around S$33,000 on average amongst private US universities and as high as S$40,000 to S$50,000 for the top private universities. In the UK, from 2006, universities will be allowed to charge up to 3,000 sterling pounds or about S$9,000 for British and other EU students. Fees for international students are significantly higher.

So looking at those figures and bearing in mind the quality of education that we offer, we believe that our universities remain competitive, for both Singaporean as well as foreign students. We intend to ensure that they remain so, and that they must provide good value-for-money.

Our universities wouldcontinue to offer scholarships to deserving students

and financial aid to any student in need. The Government would ensure that no student admitted to the universities would be denied an education because of financial reasons.

Sir, with the permission to set up foreign universities in Singapore like the University of New South Wales, wouldparents be allowed to use their CPF for such universities as it isin the local campus?

We would review this particular policy when it comes.

With the increase in the university fees,the foreign students only pay 10% more fees compared to our local students in the universities. From what I understand, foreign students at many overseas universities pay full fees. Would the Ministry consider letting the foreign students pay a higher fee so as to subsidise the local students more?

We believe that our local students are adequately subsidised and for those, as I have said, who are in need, there are study loans, bursaries and schemes like that where they could apply. So we believe that no students who have the merit are denied university education for financial reasons alone. In the light of this, we do not consider it necessary to increase the amount of subsidy to even the local students because there are already other packages to help them if they have financial problems.

As to substantially increasing the fees for overseas students, I thought the hon. Member, Mr Zainudin, is worried about losing the competitive edge. Because the university would benefit from the presence of students from other places,to have a certain proportion of foreign students to be with us is beneficial to our university's quality of education.

Just a follow up to thequestion, Sir. If we were to consider allowingparents to use their CPF for foreign university that is located locally, would that not also result in our local university losing their competitive edge?

As I have said, allowing forparents to use CPF for their children's local education is not the subject of this particular question. When the need arises, we would review it and I am sure the Member would be duly consulted.

With the fee hike andthe effort oftrying to make Singapore into an educational hub and our local universities intoworld class universities, would that not commercialise our universities and make them exclusive, in the sense that they are excluding local students from the universities in their effort of trying to become world class? I feel that our universities have a national duty to educate. So would the Ministry consider reducingthe subsidy to the foreign students, not in one shot, but in steps, and subsequently, reducing the subsidy to the foreign students altogether and use this saving to subsidise our local students?

As I have mentioned just now, no local students are denied an opportunity to enter into our universities for financial reasons alone. If they are able to gain enrolment into our universities, and they have financial problems, there are a lot of financial schemesto help them. If the Member knows of anybody, who is denied the opportunity to go to the university because of financial reasons, do bring it to my attention. I will take a personal interest in those cases and we intend to remain so, because we know that university education is veryimportant in

ensuring that our investment in manpower continues to be high, and manpower being our only resources, we would have to ensure that the quality remains good.

6. Assoc. Prof. Ong Soh Khim asked the Minister for Education (a) whether there is a quota in the annual intake of local Singaporean students for the Bicultural Studies Programme; and (b) how will his Ministry ensure that a minimum number of local Singaporean students are admitted into the Programme each year.

(for the Minister for Education): Mr Speaker, Sir,the number of applicants for the Bicultural Studies Programme [BSP(C)], "C" for "Chinese",has been encouraging, with 818 students applying for the programme. Thethree schools, Dunman High, Nanyang Girls High and Hwa Chong Institution eventually selected 305 students. Only 4% of those selected were foreign students. The intake for the BSP(C) exceeded the initial estimate of 200 when weplanned and announced the programme last year. MOE and the schools decided to expand the intake to just over 300 in view of the demand from qualified and interested students.

The purpose of the BSP(C) is to nurture a core group of Singaporean students, and I underline the words "Singapore students",who are able to understand and engage China as well as the West with confidence. They will over time help reinforce our already strong links with China.

To ensure the BSP(C) meets its objectives, however, it is important that the programme is not restricted to only

Singaporean students alone. The inclusion of some foreign students, for example,those from the People's Republic of China, would enrich the programme. This would benefit the Singaporean students on the programme. It would not only enliven the formal learning that takes place under the programme, but also foster close interactions and bonds between the students. These bonds, that are formed in school, would add to the natural web of relationships between our two countries over time.

The following Question stood in the name of Mdm Ho Geok Choo -

7. Toask the Minister for Trade and Industry, in view of our fast expanding business network into the global economy, (a) how is his Ministry working out with the Ministry of Education in preparing our younger generation for a global career; and (b) how can his Ministry assist more local businessmen and entrepreneurs to get ahead in the global competition, especially in the areas of soft skills.

Question No. 7, Sir.

Mr Speaker, Sir, I agree with Mdm Ho that our enterprises and people need to have an international mindset and the skills to compete globally.

IE Singapore has several programmes to assist businesses in upgrading their capabilities and venturing overseas. Last year, it organised various workshops and seminars on soft skills and capabilities for internationalisation, such as branding, design, manpower, financing and distribution. Staff from over 2,100 local companies attended these conferences.

Apart from skills, international experience is also important. The Asian Business Fellowship programme supports local executives to train overseas and develop in-depth knowledge of key markets in Asia. Undergraduates and recent graduates could also participate in student exchange, internship and market immersion opportunities in China and India under this programme.

Besides giving the younger generation good academic training, we need to fostera keen spirit of enterprise and innovation. The Ministry of Educationencourages schools to expose young students to a broad range of enterprise-related activities. To give students greater exposure to global realities, more schools are sending their students abroad on community service projects.

The universities and polytechnics are also expanding the opportunities for students to do internships overseas or go on exchange programmes with foreign institutions as part of their studies.

8. Mr Leong Horn Kee asked the Minister for Trade and Industry in view of the continuing weak domestic sector and the depressed market rental in the retail and industrial sectors, whether the Government will consider a reduction of the rental rates set by JTC, HDB and NEA for factories, shophouses and markets, as a measure to assist the small retailers and SMEs.

9. Mr Zainudin Nordin asked the Minister for Trade and Industry, with the property market showing signs of improvement, (a) will Jurong Town Corporation (JTC) give an update of the

occupancy rate of its industrial spaces; and (b) are the rental rates of JTC industrial spaces competitive and reflective of the current market conditions.

Mr Speaker, Sir, can I have your permission to take Question Nos.8 and 9 together as they are related?

Yes.

Sir, Mr Leong Horn Kee feels that the market rental in the retail and industrial sectors is depressed. On the other hand, Mr Zainudin Nordin thinks that the property market is showing signs of improvement. Let me use this opportunity to clarify the situation and give an update.

First of all, JTC, HDB and NEA periodically review the posted rents and prices for the different land products to ensure that they are in line with prevailing market rates. Current posted rents and prices have been reviewed and adjusted to market.

Second, let me give an update on the various property sectors - industrial properties, shophouses and markets. For industrial properties, the occupancy rates of JTC ready-built facilitiesare around 80-81% in the last two years. There is a slight improvement in the second half of last year but, generally, occupancy rates still remain low compared to 2000 and 2001 or compared to the early 1990s.

In January 2005, JTC completed its latest quarterly review of industrial land rents and prices. Posted rents and prices for industrial rents were reduced by an average of 20%, and even up to one-third in some areas. This latest round of rate cuts is very significant and will help to lower business costs for SMEs. JTC will continue to monitor our industrial land

For ready-built facilities, JTC and HDB also review their rental rates quarterly and peg them to market. In 2004, rental rates for their ready-built facilities were reduced by up to 10%. In January 2005, JTC has also further reviewed its posted rents and reduced the rentals for some estates such as Ayer Rajah, Kolam Ayer, Loyang and Kaki Bukit by up to 6%. In general, the rents and prices for this sector have already fallen in the last few quarters of 2004 and are competitive.

For shophouses and markets, HDB and NEA monitor the rentals closely. The rent for each shop and market stall is reviewed whenever the tenancy is due for renewal. Most of the tenancy contracts are short term, up tothree years. Some tenants can even opt for shorter tenancies and have their rents adjusted earlier to reflect the prevailing market conditions. For market and hawker stall holders, rentals have already gone down between 10% and 20% in the last two years. Hence, hawker and market stallholders who renewed their tenancy agreements in the lasttwo years had their rents reduced in line with prevailing market conditions. For HDB shops, the rents have remained fairly stable in the last two years.

In addition, to help businesses adjust, existing shop and stallholders who were given rental rebates before 2005 will continue to enjoy half the rental rebates till 30th June 2005.

rent prices and ensure that they are internationally competitive.

Sir, may I ask the Minister about the rental rebates? With only half the rental rebate being retained, some of the shops are actually now facing higher rentals. With the renewal of the rebates due for review in June, will it be possible for the Ministry to consider continuing with the rebates?

Mr Speaker, Sir, we should take the issue of rental rebates separately. The rental rebates were given over the last few years inview of the difficult market conditions that we faced - the 1997-1998 Asian financial crisis, the 2001 recession and the 2003 SARS. Since then, the situation has stabilised. Last year, we have enjoyed fairly good growth and, this year, we expect the growth to continue to be stable. And that is the reason why we have gradually removed these rebates. In the meantime, the rents have been lowered to reflect the current market conditions. So HDB shopkeepers and stallholders will face current rents which are very low, compared to the last five or 10 years.

Sir, I would like toinform the Minister that there are two cases in my constituency. One is the Sin Ming motor workshops and the other is the Shunfu Mart which is for wet market and foodstalls. In both of these cases, we now have the experience where the new tenders are priced lower than the existing tender for the rentals. In such cases, will the Ministry concerned review and lower the rates for the existing tenants?

Mr Speaker, Sir, asI havesaid, we review our market rents regularly. If Mr Leong Horn Kee is prepared to say that when the rents go up next time, we will undertake a review to raise rents.If he illustrates with this example, and when rents come downwe lower the rents, I will accept his proposition. But, as Members know, one swallow does not make a summer. So we always reviewthe rents and indeed if there is a trend of the rents going down, we will adjust the rents accordingly.

Sir, the Ministerknows thatthe Governmentactually increases rentals when rentals go up. It is

a fact. I cannot give an assurance. But it is a fact that the Ministry increases rentals whenever rentals go up.

As I have said, we also reduce the rents when rentals come down.

Sir, I wouldlike to inform theMinister that I also have a couple of swallows in my constituency. Although the term is for three years, for those whoare trapped in the three years and seeing rents dropping all along and increased competition frompeople who are benefiting from the lower rentals, I think they feel that something ought to be done. Can I ask the Minister that for these exceptional cases, especially if the disparity is very big, to take this into consideration and review these cases as well?

My response is similar. If you are locked into a three-year period and the rents go up sharply, will you also consider adjusting your rent even though your three-year period is not up? So it must work both ways. Anyway, shopkeepers can opt for shorter tenancies, and HDB and NEA will consider.

10. Mr Wee Siew Kim asked the Minister for National Development (a) how many JTC and HDB shops in the pastfive years (2000 - 2004) have either prematurely terminated their leases or suffered a change of lessees before the end of the lease term; (b) how do these numbers compare to the trend of priorfive year period (1995 - 1999); and (c) what are the three main reasons cited for such premature turnover.

Sir, HDB shop tenants can exit their business either by terminating their tenancy with HDB or by assigning their tenancy to another operator. There were about 900 terminations and 1,800 assignments between 2000 and 2004. Taken together, terminations and assignments were about 2,700 in the last five years, compared to 500 terminations and 2,300 assignments between 1995 and 1999- taken together, about 2,800. In fact, the number of change in tenants have dropped in the recent five years compared to the previous five years.

The three main reasons cited by shop tenants for giving up their shops are:firstly, they are of ageand their children do not want to carry on the business; secondly, they are relocating their businesses elsewhere; and, thirdly, because of poor business conditions.

11. Dr Warren Lee asked the Minister for National Development if he will consider extending the lift upgrading programme to provide more lifts for low-rise walkup HDB apartments at every level and to preserve a ratio of one lift to 30 or more dwelling units by the use of innovative solutions such as having common corridors linking two facing blocks.

Sir, the Prime Minister has announced that to meet the needs of our aging population, we will need to speed up lift upgrading, and we will try to complete the programme in 10 years for all eligible blocks, budget permitting.

Lift upgrading is an expensive programme which involves major structural works to a HDB block. The Government has to ensure that the resources for lift upgrading are used prudently and effectively and therefore have to prioritise the lift upgrading programme accordingly. We will continue to review the programme including exploring the use of innovative solutions to increase its cost effectiveness.

The provision of lift upgrading for low-rise blocks is something that the Ministry of National Development is currently looking into and we will announce more details on how lift upgrading programme will be speeded up and how blocks will be prioritised for the programme during the Committee of Supply debate.

12. Miss Penny Low asked the Minister for National Development in view of the phenomena of popping tiles in relatively new design and build or premium HDB flats, what are (a) the steps taken to rectify the problem; (b) the type of compensation can affected residents expect; and (c) the steps taken to prevent similar occurrence in future.

Sir, popping tiles are likely to be caused by localised poor workmanship during installation. In most cases, the tiles dislodge due to poor adhesion. The tiles then become hollow when tapped upon and they tend to pop out. Such defects are latent in nature and are usually not detectable at the time of completion of the flats.

According to HDB, four contracts in Sengkang and Punggol design-and-build

The compensation given by the contractors would depend on several factors, amongst which the degree of rectification works required, the impact on the existing fittings and fixtures that are already installed. And if the repair works involve replacement of all the tiles in a particular room and the removal and subsequent reinstatement of fittings and fixtures in that room, the owners might have to stay elsewhere temporarily. For such cases, the contractors would consider the owner's request for compensation for the cost of alternative accommodation.

Sir, the more important point is preventing the recurrence of such defects. HDB has specified the use of only skilled tilers for all its building projects since January 2004. These tilers would need to have the skills evaluation certificate from the Construction Industry Training Institute and be equipped with the knowledge to carry out proper tiling works. HDB also requires a demonstration of tiling work method to be done in the presence of the HDB consultants' project engineers and site supervisors before the tilers can carry out the actual works. In addition, HDB has specified the use of only pre-approved tile adhesive which is more durable than the conventional cement and sand binder for laying of floor tiles. For ongoing premium flat contracts where floor tiling works have just commenced, HDB has replaced the conventional cement and sand binder with the new tile adhesive.

and design-plus type of contracts completed between 2001 and 2003 are affected by this problem. When popping tiles occur innew flats, HDB will work closely with the building contractors to carry out rectification works quickly so as to minimise the inconvenience to the flat owners. If the dislodged tiles are due to poor workmanship, it is the responsibility of the contractors to repair the defects at no cost to the flat owner.

Sir, are the compensations granted on an automatic basis and according to a particular schedule or through a process of negotiation? I understand from residents that, currently, HDB allows the contractors to negotiate directly with the affected residents. As a result, depending on who is a better negotiator and, in some cases, who is the fiercer negotiator, the person gets an upper hand and the compensation is agreed upon as such. This resulted in unequal treatment for similar cases even if the defect occurred just a few doors apart. Could the Minister clarify whether this should be the modus operandi and whether residents can seek further recourse should they find out that they have actually had a really bad deal?

Sir, there are a total of 20 cases in the Sengkang/Punggol area which have sought compensation from the contractors. Out of the 20 cases, eight of them have already been compensated, with 12 cases still under negotiation with the contractors.

I suppose the main point is what is the extent of damage. So long as the house owner is reasonable in his demands for rectification works, the contractors would normally oblige. Also, if they need alternative accommodation -some of them have large families with in-laws with them and so forth - and if that need is clear, the contractors will oblige as well. So, in rare cases, where the tenants are more demandingand they want to be compensated more thanthe damagethat they haveincurred, this is when there may be a stalemate. In such situations -whichare very few, only 12 casesremaining -HDB can assist to see what is reasonable.

I understand from some statistics given by HDB that it

actually affects about 3.3% of the four contracts and that numbers about 108 cases. Perhaps the Minister of State could comment on the rest of those cases.

The Member is correct. The number (20), which Imentioned just now, is the number of cases that sought compensation, not rectification works. If we combine those who sought rectification works as well, indeed, only 3.6% of the number of units -which to us is 3.6% too many,and we are trying to reduce that - or 118 cases require rectification works, of which the contractor has rectified 106 cases. So the majority has been done with. Twelve of them have requested for rectification works to be done after the Chinese New Year period. I suppose they are being carried out right now.

Sir, the Minister of Statehas mentioned that HDB would intervene should residents be unreasonable. Could we also have an assurance from the Minister of State that should the contractors be unreasonable, HDB would also intervene?

Yes, we will do our best to see how we can resolve any dispute between the contractors and the households.

The following Question stood in the name of Mdm Ho Geok Choo -

13. To ask the Prime Minister and Minister for Finance (a) how many of our students on PSC and Firefly scholarships have guarantors who are not their parents and what are the reasons for their parents being disqualified as guarantors; and (b)

how many incidents of non-fulfilment have led to guarantors being liable subsequently.

Question No. 13, Sir.

Mr Speaker, Sir, students on PSC scholarships and MTI's Firefly scholarships would need to nominate two sureties or guarantors to execute the scholarship agreements. Anyone, including their parents and siblings, can stand as surety as long as he or she meets certain conditions with regard to citizenship, age and income.

We do not keep track of the number of scholars who asked people other than their own parents to stand as guarantors. Nor do we ask for the reasons why they did so. Nevertheless, based on the number of PSC and MTI's Firefly scholarships awarded between 2002 and 2004, out of 237 scholarship agreements executed, 70% were signed by at least one parent of the scholars.

It is very rare that PSC and Firefly scholars who break their bonds do not pay their liquidated damages (LD). Of the PSC and MTI's Firefly scholars who broke their bonds between 2002 and 2004, only the guarantors of one scholar disputed the settlement of the liquidated damages. The other scholars paid up the liquidated damages promptly.

14. Dr Warren Lee asked the Minister for the Environment and Water Resources if he will consider mandating the use of output limiters on public address or other sound amplification systems for use at public events, in view of recent reports suggesting that noise -induced deafness is on the rise and persistent complaints of

excessive noise caused by various religious festivals and celebrations.

Mr Speaker, Sir, the National Environment Agency works with various agencies to minimise noise nuisance from public events. Output limiters for sound amplification systems had been used previously to control the noise levels for public events. However, Sir, it was found to be more practical to control the use of loudspeakersat public events and to limit the permissible time for such events. These measures are stipulated as conditions under the Public Entertainments and Meetings (Exemptions) Order. Public events listed in the Public Entertainments and Meetings (Exemptions) Order that comply with the prescribed conditions therein do not require a licence from the Singapore Police Force.

Sir, we recognise that noise from public events may occasionally pose a nuisance to nearby residents. But there has been no evidence to suggest that such noisecauses noise-induced deafness. Nevertheless, NEA and the relevant agencies will continue to review regularly the conditions for issuing permits for public events, taking into consideration feedback from the public.

Sir, while some of these events may not need to be licensed, nevertheless, there are many community events where the loudspeakers are actually quite loud and the people who actually run these PA systems may not be very experienced and may not knowwhat the permissible sound levels would be. Surely, it might be possible for some sort of noise limiters to be made easily available to themso that even if it is not under legislation, people can engage contractors who have these

noise limiters, if the Government pushes for it.

Mr Speaker, Sir,I think the Member is referring mainly to religious festivals.Before any religious festival is organised,there are usually several procedures. The organisers would need to approach, for example, the Adviser himself. The Adviser would be in the best position to advise the organisers what to do and what not to do.Then it goes to the Town Council or the relevant Government authority which owns the land.

On the event day itself, if the noise level is still too loud, the Police is usuallynotified and the Police will comeup and advise the organisers to tone it down. There is a time requirement. They cannot start blasting the noise through the loudspeaker before 11.00 am and they cannot go beyond 10.30 pm. So, these are some of the constraints that organisers already face. We think, with these constraints, the organisers should not be compelled further. Sometimes, there are good reasons why the organisers need to have slightly louder loudspeakers because the event is a mass event in a very open space, and they need to reach certain audience who may be very far from the stage. But, having said that, the key to controlling the noise level is actually the location of the site. If the site is very close to HDB flats, then, obviously, the Adviser in the area should advise the organisers to limit the number of loudspeakers in the first instance.

15. Dr Warren Lee asked the Minister for Transport what actions the Government intends to take regarding motorised bicycles using internal combustion engines, now that only electrically powered motorised bicycles are allowed on our roads.

Mr Speaker, Sir, the Land Transport Authority (LTA) and the Traffic Police (TP) have since 1st January 2005, introduced a revised set of requirements for low-powered motorised bicycles that can be exempted from registration. These requirements are to enhance the safety of riders as well as other road users.

Prior to this revision, motorised bicycles using low-powered internal combustion engines (also known as petrol-driven bicycles) with an engine capacity of up to 23 cc were treated like conventional bicycles and were allowed for use on public roads. However, the LTAfound that petrol-driven bicycleswere being fitted with higher capacity engines that ranged from 30 cc to even 90 cc. These bicycles have higher power and were able to travel at higher speeds, whichtheir construction and brake systems were not designed to cope with. They posed a danger to the riders as well as other road users. In view of the serious safety risk,the LTA decided not to exempt petrol-driven bicycles from registration and technical requirements. As such, with effect from 1st January 2005, all petrol-driven bicycles, regardless of engine capacity, are treated like any motorcycle and must meet the technical and registration requirements of a motorcycle.

Since the implementation of the revised requirements, the LTA has seen a significant decline in the use of petrol-driven bicycles on public roads. So far, only four riders have been caught using petrol-driven bicycles on public roads. They were advised to remove the engines and fuel tanks from their bicycles if they wished to continue using their bicycles on public roads.

The LTA and the Traffic Police will continue to take enforcement action against riders using suchbicycles on public roads to ensure the safety of the

riders themselvesas well as other road users.

16. Assoc. Prof. Ong Soh Khim asked the Minister for Trade and Industry (a) whether it is justifiable to commit $900,000 each on young A*STAR scholars, whose goals and directions may change in time to come; (b) will this money be better spent by training these scholars at the NUS and NTU, which are world class in their own right; (c) whether there is a minimum number of such scholars, who are Singapore citizens; and (d) how will his Ministry ensure this pool of A*STAR scholars has a minimum number of Singapore citizens.

Mr Speaker, Sir, the Member has four parts to her Question. So my answer is somewhat long. I seek your indulgence.

Today, A*STAR has 1,746 researchers, scientists and engineers (RSEs) in its 12 A*STAR research institutions. Of this, 50% have Ph.D qualifications, and only23% of this group are Singaporeans (ie, Singaporean born or naturalised). Singapore aspires to become a knowledge-based economy. A*STAR supports this aim by providing a diverse and critical mass of local and foreign Ph.D manpower to meet the needs of industry.

In order to attract local and foreign companies to stay, expand and set up R&D facilities here, Singapore needs a pool of well qualified local and foreign R&D talent. Since 2001, A*STAR has adopted a two-pronged pro-local as well as pro-foreign talent strategy to build up Singapore's Ph.D human talent, with a target profile of 50% local and 50% foreign Ph.Ds in the various A*STAR research institutes.

Today, there are 252 scholars, comprising 195 B.Sc scholars and 57 Ph.D scholars, in the overseas National Science Scholarships (NSS) programme and 115 Ph.D scholars in the local A*STAR Graduate Scholarships (AGS) programme. The overseas NSS programme was launched in 2001, and the local AGS programme was launched in 2003. These programmes will nurture and groom talents for an R&D career by providing research-intensive training for Singaporeans in the various fields of Biomedical Sciences, Physical Sciences and Engineering at top universities and research facilities bothat home and abroad. The selection process for A*STAR scholarship programmes is rigorous to ensure suitability and a long-term fit. Scholar candidates are put through several rounds of interviews, psychometric tests, and assessments.

The NSS Bachelor of Science programme requires scholars to complete their B.Sc in three years for which they are bonded for six years as PSC scholars, during which they will return to Singapore at least once for an eight-week research attachment. On completion of their B.Sc, the scholars return to Singapore to undertake another research attachment of at least one year in an A*STAR research institute. They are then given paid study leave to pursue their Ph.D locally or abroad. They must complete their Ph.D within five years. The academic cost of the three-year B.Sc course amounts to about S$200,000, while the five-year Ph.D portion amounts to about S$400,000. In addition, there are costs such as living and book expenses and other allowances which amount to about S$300,000.

In the event that a scholar does not meet A*STAR's stringent academic criteria to continue with a Ph.D, or if a scholar decides that a career in research is not what he or she wants after

In2003, A*STAR established partnerships with NUS and NTU to set up the A*STAR Graduate Scholarships (AGS) that I mentioned earlier, to provide local Ph.D training for Singaporean undergraduates with 1st class honours for which they are bonded for three years. This Ph.D training lasts for three to four years, and could be followed by a one to two year overseas post-doctorate fellowship at a total cost of S$360,000. In the past, few NUS and NTU graduates were prepared to pursue a Ph.D degree. Due to the active promotion of the AGS programme by A*STAR, NUS and NTU, the number of Singapore students applying for the AGS programme has increased. To-date, there are 115 AGS awardees. The A*STAR Graduate Academy (A*GA) aims to enrol 100 AGS scholars a year. At steady state, 300 to 400 AGS scholars will be studying and working in the laboratories of the various A*STAR research institutes and universities.

The majority or 82% of A*STAR scholars are Singaporeans. Foreign-born scholars are given Approve-in-Principle (AIP) Permanent Residence status and are required to take up Singapore citizenship before the completion of their Ph.D programme.

completing the B.Sc, the scholar is allowed to take up an executive position at A*STAR or at another Government agency.

17. Assoc. Prof. Ong Soh Khim asked the Minister for Trade and Industry what is the rationale for A*STAR's change of domain name from "astar.gov.sg" to "astar.edu.sg" which can give a misleading impression that it is an educational institute.

Mr Speaker, Sir, the question is a short one. So the answer will be correspondingly short. The websites of A*STAR and its research institutes may be accessed via both the ".gov" and ".edu" domains. The ".edu" domain name is to reflect A*STAR's mission of fostering world-class scientific research and talent for a vibrant knowledge-based Singapore. It is common practice internationally for research organisations, not just educational institutes, to use the ".edu" suffix or the equivalent.

"to provide for making supplementary provision to meet additional expenditure for the financial year 1st April 2004 to31st March 2005(both dates inclusive)",

recommendation of President signified; presented by the Acting Second Minister for Finance (Mr Raymond Lim Siang Keat); read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY 2005/2006, and to be printed.

"to amend the Betting and Sweepstake Duties Act (Chapter22 of the 1999 Revised Edition) and to make related amendments to the Singapore Totalisator Board Act (Chapter 305A of the 1999 Revised Edition)�?,

recommendation of President signified; presented by Mr Raymond Lim Siang Keat; read the First time; to be read a Second time after the conclusion of proceedings on the Estimates of Expenditure for FY 2005/2006, and to be printed.

Order read for Resumption of Debate on Question [18th February, 2005],

"That Parliament approves the financial policy of the Government for the financial year 1st April, 2005 to 31st March, 2006.". - [Prime Minister and Minister for Finance].

Question again proposed.

Mr Speaker, Sir, against a backdrop of a strong 8.4% expansion last year and the near elimination of an initial projected budget deficit of $1.4 billion, Prime Minister and Finance Minister, Mr Lee Hsien Loong, presented a creative Budget, which main thrust was the promotion of a caring and inclusive society. This came in the form of goodies and giveaways for Singaporeans in education, health, provision for retirement, retraining for workers and building a caring community. However, the Budget fell short in introducing new measures to consolidate business recovery and promote Singapore as a base for regional operations. It is narrowly focused and aimed at specific industry sectors or the measures represent refinements of the existing tax incentives and programmes.

What I have just said represents the general sentiment expressed by Resource Panel members of the GPC for Finance and Trade and Industry, which comprise representatives from the various Chambers of Commerce and trade associations, with whom the GPC met last week to gather views and reactions from the business community. Views solicited from the finance and accounting fraternity, including the big four accounting firms and bodies, such as CPA Australia and local firms also bear similar sentiments. They have all provided the GPC with valuable feedback for which I wish to thank them.

While the announcements were welcoming in themselves, the business community, in particular, would have loved to see the injection of more stimulants to the economy, with more wide-ranging measures which would benefit all businesses. There was also disappointment that the Budget did not contain sufficient measures to help companies cut costs and address their concerns about competitiveness.

SMEs

Allow me to elaborate more on the feedback from the SME community. Generally, many SMEs, especially small businesses, still felt that last year's strong growth has not filtered down sufficiently to them. They expressed that the measures do not adequately address the difficulties and challenges that they are continuing to face. While they expect growth to continue into this year, the SMEs are very concerned about their lack of competitiveness. High labour costs and difficulty in access to capital are cited as the key contributors to their eroding competitiveness. Members of the Singapore Manufacturers' Federation (or SMa), which include MNC representation, with whom our GPC alsoseparately met, went as far as saying that traditional manufacturing is rapidly hollowing out and wondered whether the Government truly has a long-term strategy to retain the 25% manufacturing contribution to GDP, which the Government has repeatedly said it would do. Hearing what we had to say, I think it would be beneficial if the Ministry of Trade and Industry could step up dialogue with the SMa to further understand their woes.

Foreign worker levy

LocalSMEs and manufacturers are especially critical about the increase in foreign worker levy which they feel unnecessarily adds to their business cost.

HDB retailers

Sir, the announced measure to help retailers in HDB estates either upgrade their businesses or exit the sector is indeed welcoming. I believe this could eventually have a positive impact on the economy if it succeeds in unleashing new energies in a sector that takes up a considerable amount of real estate, labour and other resources - and which has been under-performing for many years.

Carry back of tax losses

Sir, perhaps the most pleasantly surprising announcement in this Budget for local SMEs is the one-year loss carry-back rule, capped at $100,000, for excess current year trade losses and capital allowances. This is particularly meaningful for SMEs in helping them alleviate cashflow problems ina business downturn. However, there is some lack

Considering that existing rules permit a tax exemption of up to $100,000 of chargeable income for the first three years for new start-ups, would the loss carry-back be set off before or after the exemption amount? If the intention is earnest about helping small businesses, the loss carry-back should be set off after exempting the income for this scheme to be truly meaningful.

How long would the IRAS take to refund any tax following the claim for loss carried back? Would this be done only after the company has finalised and filed its tax for the particular year of assessment?

In connection with this issue, would the Government also permit carry back of losses if a company chooses to cease its business? In the UK, a company is allowed to carry back losses against the profits of the three years preceding the year in which the loss is incurred if acompany discontinues its trade. If this were allowed, it would certainly provide a breather for businesses that have failed to quickly pick up the pieces. This would also help in further encouraging entrepreneurship in our country. I hope the Minister could consider this.

Government outsourcing

Next, Sir, on Government outsourcing. In its endeavour to stay lean, I am encouraged to note that the Government intends to step up outsourcing. This move should be win-win for both the public and private sectors.

As the Government moves towards outsourcing moreof its non-core functions to the private sector, I would like to urge the Government to give due consideration

I am confident that many of our SMEs have the capability and competence to handle many Government projects but they lack the clout and branding that the bigger players, namely, the MNCs and GLCs possess. They tend to be oftenelbowed out by these players. The Government should provide opportunities for our SMEs to enhance their role as suppliers to the public sector. We should follow the example of some countries where the Government agencies set aside a certain percentage of their procurement for the SME sector. I will delve more on this subject in the COS debate.

Financial services sector

Sir, let me now move on to the financial services sector. This sector undoubtedly received the biggest boost in this year's Budget. The wide variety of innovative measures announced will further enhance our reputation as an international financial centre and strengthen our resolve to be a premier wealth management hub.

Allow me to comment on two of the initiatives announced, namely, Islamic finance and banking, and Real Estate Investment Trusts (REITs).

Islamic finance and banking

Mr Speaker, Sir, the global Islamic finance industry has grown at a phenomenal rate in recent years, with the current estimated market to be more than US$300 billion in over 70 countries. With

Singapore already has a well-developed and regulated banking and finance infrastructure which is internationally recognised and respected. The existing framework, such as statutory and liquidity requirements, corporate governance, etc, could, by and large, be made applicable to Islamic finance without affecting the Islamicity of the system. However, there are some additional requirements, such as interest-free banking requirements and the need to follow the Shari'ah (or the teachings of Islam) that need in-depth discussion and consideration.

I would like to propose that the Government consider the progressive development of a full-fledged Islamic banking and finance system as an alternative to the conventional system. I believe such a move will send a strong signal to the financial community that we are responsive to the changing global financial landscape. A well-defined system and an adequate Syariah infrastructure will attract corporate players and pave the way for Syariah-based

The issue is not so much the levy increase but the difficulty in recruiting skilled Singaporean workers and also their lack of flexibility at the workplace. Similarly, the construction industry, in having to price their contracts with minimum or no profit due to stiff competition, will be directly hurt from the levy hikes as their contracts are committed over a fixed period with a fixed sum. Their dependence on skilled foreign workers will continue even with the higher levy, negating the desired outcome of making Singaporeans more competitive in the job market. In this regard, the Government should have been more targeted at specific industries where the job content and value better match Singaporeans' skills set and desire to be employed in. I would like to urge the Ministry of Manpower to rethink this move as it may also result in some cost sensitive industries to consider relocating due to the added cost they now have to bear. of clarity in the scheme which I hope the Minister could clarify:for a reasonable slice of the outsourced activities to be set aside for local SMEs. In proposing this, I am certainly not suggesting that there should be any let down in quality or reliability of the outsourced functions when any of the PPP deals are struck up with SMEs. They must also pass the appropriate market tests.the annual double-digit growth expected to continue, it represents one of the most dynamic segments of the global financial system. In the wake of our country endeavouring to increase trade and economic activities with Middle Eastern countries, and with SM Goh being very active in visiting a number of Muslim countries since last year, it is timely, indeed, that PM Lee has announced various tax measures to facilitate Singapore's development into a hub for Islamic finance activities.

loan syndications, private debt securities, issuance of bonds and many other Syari'ah-compliant instruments to be placed here. This will add further vibrancy to a thriving wealth centre that we are pursuing to become.

As it stands now, Middle East funds are already showing a lot of interest in Singapore because of our reputation as a

REITs

REITs, as a new and rapidly emerging asset class in Asia, bring with them the potential of unlocking value tied up in real estates, enhance the liquidity of real estate market, and free up the capital of companies that hold large numbers of properties for other higher-yielding alternatives. The several successful REIT listings in Singapore to-date clearly demonstrate that there remain opportunities for further growth.

The three measures announced by the Prime Minister to lower REITs, set-up costs and enhance their appeal to overseas investors would undoubtedly bring about greater excitement in the REITs sector. However, bearing in mind Singapore's smallness and therefore limited asset portfolio that could be developed here, two measures I think that could help inject further vibrancy to the REITs scene are:

The development of incentives for local REITs to buy into overseas markets so that their income and profits could be repatriated to Singapore; and

The encouragement of foreign REITs to list in Singapore, notwithstanding the cross-border issues that need to be dealt with and resolved.

I hope the Minister could consider these additional measures in the not-too-distant future.

Sir, let me now touch on the "heart" side of the Budget. I acknowledge that this year's Budget contained a generous spread of goodies for the man-in-the-street, to the extent that some dubbed it an election budget. It is ingeniously packaged and, when fully implemented, will benefit Singaporeans from all walks of life. However, just like at each year's Budget announcement, expectations are abound.I would like to comment on a few such incentives where I think the Government could have gone a little further for the benefit of Singaporeans.

Taxes

With regard to taxes, the 2% cut in personal income tax has been widely expected as a given, although many were disappointed that it comes in two stages. However, reduction in income tax only benefits about 30% of Singaporeans, as the remaining 70% do not pay taxes. This is where I feel the Government could have been more generous to the man-in-the-street. Consideration for allowing tax deduction on mortgage interest is quite overdue, especially in the light of mortgage interest rates. This will benefit a wider cross section of Singaporeans. Many countries, such as the US, Hong Kong and Taiwan allow this, subject to a maximum cap. Buying a home is every Singaporean's dream. Therefore, making home mortgage interest allowable will help realise the Singaporean dream faster, as it makes the total cost of owning a home cheaper.

The Government may be concerned that allowing tax deductions on home loans may lead to speculation and a new

Reduction in road taxes would also be meaningful to more Singaporeans. Considering that the Government has implemented effective mechanisms, such as Electronic Road Pricing and capping vehicle population increase on a monthly basis, there is certainly room for road tax to come down further.

Savings for retirement

Sir, it is laudable that the Government has tweaked the CPF voluntary contribution cap by individuals to make it coincide with the mandatory contribution cap of 17 months of the CPF salary ceiling. Similarly, the rules on the contribution caps for the Supplementary Retirement Scheme (SRS) have also been relaxed. These revisions, hopefully, will encourage individuals to take active steps to set aside more for their retirement. However, Sir, it has to be borne in mind that CPF contributions today have come down to 33%, compared to a high of 40% in the not-too-distant past, and contribution rates are lower for those above age 50. Furthermore, much of Singaporeans' CPF savings have been used up for property purchases, leaving not too much for retirement. This is especially of concern, in view of the fact that we are among the fastest ageing in the world.

The SRS, which was introduced to encourage additional savings for retirement, has its drawbacks, in that the

An attractively revamped and repackaged SRS as a world-class savings and pension system could draw economic benefits beyond just meeting the retirement needs of Singaporeans. If long-term products with attractive tax benefits could be offered, the scheme would also be an additional advantage to foreign talent who may be considering a posting in Singapore, and also for foreigners who are searching for a safe haven to park their retirement savings. It could blossom over time and gradually be positioned as one of the pillars of our wealth management industry.

I would like to advocate that a committee be formed to review the SRS and how the scheme could be made more attractive for Singaporeans to look upon it as a viable vehicle to park their retirement nest eggs.

Employability of workers

Finally, Sir, let me dwell briefly into measures to ease joblessness and help Singaporeans stay relevant to the changing needs of the economy. While the $500 million top-up to theLifelong LearningFund will bring more programmes to reskill workers and help job seekers, ultimately, it is real and meaningful jobs that count. Reaching out to the jobless and those at risk of losing their jobs is the real challenge of the Workforce Development Agency (WDA).

The Re-Employment Assistance Programme (REAP), aimed at helping low and less-skilled job seekers cross over into new jobs, must be made easily accessible to workers who need the assistance most. I have had a number of cases at my meet-the-people session where workers were turned away feeling disappointedwhen they inquire about getting training. To be effective, REAP, apart from redesigning jobs and training workers to take up the jobs, should also have some flexibility to customise programmes to specific needs, provide on-going support to help workers stay on the job, tie income benefits to re-employment assistance, link training with job opportunities, and monitor performance and evaluate the effectiveness of the programmes.

Sir, we need to find better ways to equalise supply and demand within private and public sector organisations to best use people of all ages, including elderly people. A mechanism to prevent the pricing out of older workers arising from seniority-based pay increases, needs to be worked out quickly. In today's context, salaries and wages must reflect the value of the job, or organisations risk losing their competitiveness, if they are stuck with highly paid senior and older workers. Mindsets and attitudes need to be quickly changed to get people to accept that salaries and compensation can go up and down, based on job assignments and also the prosperity of the companies they work for. Elderly employees are generally more at risk of losing their jobs when employers are forced to restructure to address their competitiveness because of the seniority-based wage system. This is where a clear definition of job competency expected of individuals becomes meaningful. Then only can we do away with labels, such as "young" or "old" workers. When there is clarity of the competency and capability of each employee in the organisation, it eliminates age biasness as it becomes clearer that each employee makes a contribution to the organisation. Here, I

To conclude, Sir, I would like to congratulate Prime Minister Lee, who is also the Finance Minister, for a well-crafted and innovative Budget. The theme for this year's Budget"Creating Opportunity, Building Community" should well position us to respond and adapt ourselves to the constantly changing global environment. When more opportunities open up for everyone, it erases the sense of doom and gloom and creates a sense of achievement in each of us. It enhances a sense of belonging and breeds rootedness. This is what we all should work towards.

On that note, Sir, I support Prime Minister Lee's Budget Statement.

well-regulated and prudent financial regime. I would like to draw our Minister's attention to what Citigroup Private Bank's new Managing Director, Mr Alston Beinhom, has said and quoted in the Business Times of 27th January this year. He said, "Private money from the Middle East is increasingly looking to Singapore as an alternative wealth centre." Therefore, the presence of an Islamic banking and finance system will send a clear signal to Middle Easterners that we are serious in wanting their business. Sir, I will revisit this subject during the COS debate.bubble building up. However, such concerns could be quite easily plugged by requiring the property to be owner-occupied, imposing a cap on the mortgage interest amount that is tax-deductible, and also a time limit of, say, 10 years from the date of purchase of the property. Hong Kong, for example, allows seven years of deduction, provided that the property purchased is used as a principal place of residence by the owner.limit has been reduced in recent years and the accrued tax savings are not sufficiently attractive. As a result, I understand the take-up rate for the SRS has been rather low. There is scope for the SRS to be fine-tuned and made an attractive vehicle for more Singaporeans to make additional contributions for their retirement. The more Singaporeans save for their retirement, the less will the burden be to the Government in looking after the financial needs of the elderly. see also an urgent need for the Government to work on these challenging issues with the NTUC and employers in order to make all categories of workers relevant to theirorganisations and the economy.

Sir, I rise in support of the motion.

First of all, I would like to say that this year's Budget is really a budget for the man-in-the-street, and I am glad that we had so many initiatives to help those who need it most, particularly the senior citizens and older Singaporeans. This group of citizens was starting to feel a bit left out since Prime Minister Lee took office. But in this Budget, he has set the balance right.

Sir, businesses, especially small and medium enterprises, had high hopes for the Budget, as Dr Ahmad Magad mentioned just now. But now they are calling it a non-event. Businesses felt that they have been forgotten in this Budget. Some are even saying that this is not a very helpful Budget for them, particularly

Sir, I counted the list of initiatives the Prime Minister announced, ie, three for local businesses and 11 for the people. So, although the Budget has been touted as being wide-reaching and heartfelt, it is really a conservative Budget. The Prime Minister should understand, therefore, why the businesses feel that they have been forgotten - three for businesses, 11 for the people.

Budget History

Sir, let me talk a bit about the Budget history. I would like to focus on just two areas:

taking a deeper look at the structural problem of our economy; and

exploring how we can develop local enterprises.

Sir, instead of spending time on the three incentives - I think Dr Ahmad Magad has covered them more thoroughly than I could - let me just put things in

Today, we are in a different era. The Asian currency crisis hit us at about the same time when we were beginning to embrace the arrival of the knowledge-based economy. It was also theera of globalisation.

local companies. However, they are glad that it is not ahurtful Budget, except for the regrettable increase in the foreign worker levy. But I personally can understand why our Government seems to have left out the businesses inthis Budget. For the past three years, the Government has implemented many of the recommendations made by the Economic Restructuring Committee. Perhaps the Government feels that all that itneeds to do now is to do some fine-tuning. However, my sentiment, predictably, is this: why not do more? We cannot possibly do much harm in developing our SMEs further, but the gains for the economy can be tremendous. Why slow down the momentum? In fact, there are risks in slowing down at the first signs of recovery, the same comment I made atlast year's Budget debate. I was afraid that this would happen, and it did.perspective. During the early years of our nationhood, the budgets then were radical in nature, resulting in significant spending, with many direct incentives and innovative ideas for the continuousboosting of theeconomy. The Government introduced many bold measures every year.Then, in the late 80s and the 1990s,when we were in a relatively stable period, the budget became prudent and conservative at that point of time, so we had few of these booster measures. They were designed to maintain our double digitgrowth. During this period, there was little need to institute aggressive budgets, as our economic growth momentum was already positive and regional economies were laggards and ourearlier strategies were really bearing fruit.

Today's conditions,in many ways, aresimilar to the ones that werefaced by our pioneering Cabinet in the mid-1960s.Today, we are no longer sufficiently differentiated from other economies in the region. Once again, we are running with the pack, as we did in the 1960s. We,like everyone else, are chasing the same foreign direct investments (FDIs). If there is any difference between now and the 1960s, it is that the economic cycles today are much shorter and the swings are much larger, perhaps worse than the pioneering years of Singapore.

Sir, I had hoped that theBudget would have actuallyrepresented a robust response to the changing times. But what I am seeing is an indifference to this reality. The 2005 Budget givesan impression that the decision-makers have reverted to the habits of the era of the

Positive fiscal impetus and slowdown

Mr Speaker, Sir, even though a few sectors of the economy seem to be gathering speed, we cannot mistake this as a sustained recovery. Instead, we must continue to push until all cylinders are firing. Let me make an analogy.Whena car stalls, a manual one, and we want to restart it, we all put our shoulders together and pushthe car. But we do not stop once the car has gained momentum. We only stop when the engine starts firing and the car is able to continue on its own momentum and then we let go and watch it go. Similarly, I feel that the Government has been too hasty in withdrawing its stimulation support for businesses at the first sign of an economic recovery. So instead of announcing a contractionary budget for 2005, we should have continued with an expansionary budget. Why would it have been prudent to keep the fiscal impetus positive?

Sir, this year, the external demands, in my opinion,will be worse than last year.Japan has slowed down and is technically in a recession. Europe and the UScannot possibly sustain their levels of growth that they had last year. China's slowdown will also impact the region. This is hardly the time to take our shoulders off the wheel. As it is, our unemployment is still relatively high compared to what we are used to. Surely, all these factors would justify an expansionary budget that stimulates the growth of local enterprises.

Mr Speaker, Sir, I would like to spend some time to talk about why we need tomakethis fundamental change of mindset in order to develop the futureeconomy and how this can be accomplished.

The structural problem of our economy

Let me first address the question of why do we have a structural problem with the economy. To answer this question, we mustrealise that what has worked in the past maynot necessarily workin the future or today.

30-year cycles

Sir, I have categorised our economy into 30-year cycles. In my opinion, we are caught inthis 30-yearcycle of our own creation. And if we continue the practice of pump priming a few sectors of growth, we will perpetuate thecycle.We think we are restructuring when we select new sectors to replace those that are declining,but we are really realigning. The real solution for Singapore is to get to the essence and fix this structural problem.

In my opinion, this 30-year cycle is a result of our economic planning model. Let me explain. Some 30 years ago, we planned our economy based on foreign direct investments. It was not wrong because at thattime, we attracted electronics and semiconductor MNCs to set up base in Singapore asour primary

Why is Singapore plagued by this 30-year cycle where we reach structural distortions at the end of each period? I believe the answer lies in how we selected and developed the industries. Whilst I do not doubt the correctness of the type of industries we have selected forthe economy, I think we could have done it better. The approach we have taken all this time till today is to give priority to bring in MNCs as opposed to at least balancing the support we give toforeign and local companies. This is the crux of our structural problem.

So if you look at what we are trying to do for the service industry, most of the incentives and the developmentefforts are in trying to develop the big multinational companies to set up their bases here so that our small enterprises in Singapore can support them. So it has not

While it appears that the vision to achieve this form of economic growth has been understood by the Government in the lastfive years, there are many indications to suggest otherwise. I urge the Government to stay the course in its resolve to build an economy where local enterprises are considered asvaluable contributors.

Sir, Taiwan is an example of an economy that has made these bold moves. She was in a similar predicament as we were approximately 20 years ago when we were both the Asian Tiger economies. Realising that they needed a base for stronger local enterprise for sustainable future growth, as multinationals were exiting Taiwan at that time in point, Taiwan restructured by focusing its resources and support on their local enterprises, and today they are at least 20 years ahead of us in terms of a robust economy. Many SMEs have grown to become big companies and some have achieved MNC status.

Taiwan, like Israel, has survived (economically) the past decades in large part because both have emerged with an entrepreneurial business culture. As the joke in Taiwan goes, if you throw a stone on the streets of Taipei, youwould most likelyhit an entrepreneur. SMEs make up 98.5% of Taiwan's companies. They employ about75-80% of the workforce and also form about47% of the

Sir, many tell me that they findlittle evidence in this Budget that we place a great emphasis on the development of local enterprises. In fact, this Budget gives the impression that structural changes are no longer necessary or that these changes have already been addressed in previous years. Perhaps our policy makers think that the EDB has done another fantastic job to renew the confidence of MNCs in Singapore and that things are back toold again. But how long will this last - another five years perhaps? It is this Budget's non-treatment of structural issues andpolicy signals that are things that we should be concerned about.

Encouraging local enterprise is far more complicated than creating a base for selected MNCs who are already successful and we just transplant them to our shores.But we cannot shy away from this challenge. We have to undo the neglect of the last 20 years which has created the problems that we are in right now.

The Budget could have made a big difference had it further addressed these structural problems and it could have painted the picture that the Government's commitment to local enterprises is not losing momentum and that the Government did not abandon the process at the first sign of some recovery. We must strengthen our commitment to develop our local enterprises.

Make structural changes to support local enterprises

Sir,let me address the question of whydo we want to develop local enterprises. Some policy makers may even ask, "Why put any bet on the laggards?" But they forget that SMEs are laggards because we define them as such.

Why do we want to develop local enterprises?

I am strongly advocating developing the local enterprises because they represent another engine for our growth - in Taiwan, a huge engine - and itcould be a huge engine for usone day. They will not replacethe contribution of MNCs to our economy. But they can nevertheless become another major contributor.As we all know, supporting local enterprises and attracting more MNCs are not necessarily a zero-sum game. Here isanother reason why we should develop local enterprises. Local enterprises already todayhire more than 50% of our workforce. And, over time, like Taiwan, they may hire even abigger proportion. With structural unemployment, we will increasingly have to rely on local enterprises to absorb more workers. So, there must be a mindset shift amongst all of us that we need these local enterprises and therefore must clear the way for these companies to perform their useful roles.

If we take a closer look at how we finally established a firm foothold for a MNC-type-of economy, we willfind that

So, what should be the recipe for developing local enterprises? I think there should be three key ingredients. First, we need the right organisation structure and culture to support local enterprises; second, we need to allocate the right resources; and, third, we must continue to improve access to funding.

A new Local Enterprise Development Board

A new Local Enterprise Development Board for Singapore is what I am asking for.First, the way we organise ourselves to support local enterprises. We need to re-examine how the Government is organised to support the start-up and growth of these enterprises all along. In the Government, we haveadopted this multi-agency approach.EDB, SPRING and IE Singapore, in addition to IDA, were all trying to play a useful role. But this multi-agency approach, in my opinion, has proved to be more useful to the agencies than it has to the local enterprises.

I now believe that what local enterprises need is one agency that is dedicated solely to the promotion of local enterprises,in the same way that the EDB is dedicated to the promotion of MNCs. EDB, as an organisation, is very focused, very single-minded in its pursuit of FDIs and in supporting of, and speaking up for MNCs. We do have an equivalent organisation for supporting local enterprises.

When SPRING was formed, it was hoped that it could fulfil the role for SMEs the way that EDB fulfilled the role for MNCs. But, SPRING could notfulfil this

SPRING's reluctance was understandable. From their perspective, why champion something that many in Government thought was a losing cause? It is better to hedge one's bets. It is now time that we created a single agency to support our local enterprises. In fact, I heard from a former Government officer that at one time, the Government was thinking of creating the supportfor SMEs in EDB. But the policy makersin EDB were not very supportiveof this and wanted to get out of it and, therefore, it moved from there to PSB or SPRING right now.

Sir, the best way to create a conducive environment for enterprises is to remove road blocks. So, it is heartening to learn that more than 9,000 unfriendly rules have been removed or modified, as the Prime Minister has announced. Yet, we still regularly come across rules that get in the way. So, there must not be any let up in cutting red tape. I think that the movesin the pastwere excellent and we should keep this momentum going.

However, now thatGovernment officers have begun to warm up to the idea of cutting red tape,Isuggest we introduce another campaign to change thefirmly held beliefsamongst civil servants, which are still biased against local enterprises, except, of course, for those enterprises

dizzy 10% growth when budget prudence was the norm. Our policy makers require a fundamental shift in their mindset. Sir, for our role model,I recommend Mr Allan Greenspan. He has a habit of reacting early and keeping the momentum going for longer than what economists expect. He knows how important it is to keep the boosters firingin an economy in order to keep the momentum going. So when economists describe this year's budget asa 'typical Singapore signature of prudence and conservatism', the Government should not celebrate but rather despair that it has not invigorated everyone and thatit has failed to introduce the much needed boost which our economy so desperately needs to bring us tothe next sustainable level. growth sectors for that industry. Our economy then grew linearly and steadily for about 25 years, driven by the many companies setting up manufacturing bases in Singapore and also by the growth of the supporting small and medium enterprises that support these multinationals. Today, we havereached a saturation point for such industries. In fact, thereis some degree of decline. Later, 20 years ago, in another economic plan, we went for the disk drives industry which started successfully and saw staggering growth. It has since become a mature industry and growth has tapered off. Again, with yet another plan, 10 years ago, we started focusing on the infocomm industry- so far this is still growing and will hopefully show modest growthfor another 20 years. The most recent addition to our economy which we started aboutfiveyears ago, is the life sciences industry. Each one of these sectors actually allowsgreat potential for growth for our economy. ButI am not sure that these sectors will grow for a longer period than what we desire.changed. We know that each MNC will one day have to uproot and move to more cost-effective places like China, Vietnam and India. This is a known phenomenon. The question is, can we have an economic model thatlengthens these 30 years to a longer period? Can we create a much more robust economy for our nation? My opinion is, yes,and this is possible if we place greater focus on developing local enterprises into stronger companies which could one day become Singapore's multinationals.economy. It is no wonder that corporate Taiwan is referred to as an 'army of ants' and Taiwan as a Nimble Tiger right now. As SMEs succeed and grow, they fall outsidethe definition of SMEs and their performance no longer gets captured in our measurement of SMEs. Our current way of calculating SME performance is therefore a circular calculation, doomed to give us the answer that we have defined at the outset. I wonder if our policy makers include the performance of Venture Manufacturing, Creative Technology, and Hong Leong when they examine the performance of SMEs. I think they did not. But these were allSMEsat one time. This is why I phrasemy originalquestion, "Why do we want to develop localenterprises?", and not SMEs. I think it istime that westopped generalising and labelling our local companies as SMEs. we took the better part of 10 years and billions of dollars before we were successful. And likewise with the GLC economy. Many years of effort, dollars and iterations to our initial plan before we finally reaped the benefits. single-minded role because SPRING continued to be a workforce developer, a standards organisation, a technology developer, and it continued to market its slew of SQA, QCC and other programmes. Championing SMEs was then an incidental activity.

that are already clear winners.Another area of how the support structure and culture could change isthe wayGovernment measures the success of its economic development policies. SMEs are usually shunnedby civil servants because the latter find it is better to engage larger companies to carry out new

So, therefore, our solution lies in creating a new Local Enterprise Development Board, as I call it or any other name that we are going to call it, which focuses on one task - developing our local enterprises to be the key economic contributors for Singapore. SPRING could fulfil this role, if it were its only role, but then the Governmentwill haveto create new agencies to take over productivity promotion, standards and other distractions that SPRING may have right now.

The Resource Allocation Question

Sir, let me move on to this second ingredient of resource allocation. Assuming we now have an agency whose sole mission is the development of local enterprises, such an agency must also have access to adequate resources. Presently, resource allocation is highly uneven and biased towards the promotion ofmultinationals. A quick glance at the Budget book and the budget allocationover the last four years for EDB, SPRING and IE Singapore will illustrate the disparity infunding. EDB continues to receive twice the amount allocated for SPRING and three-and-a-half times the

Having immense resources at its disposal is important, but what is a more important element of EDB's success, I believe, is people. We could gauge how much importance the Government attaches to EDB's job by looking at who they puton the job - Philip Yeo, Teo Ming Kian, Lim Swee Say, Tan Chin Nam, and many more. These are all exceptional people who have the ears ofthe Ministers and also the Prime Minister. For each, duringhis tenure asthe Chairman or Managing Directorof EDB, it washis full time or primary job responsibility. Sir, just as the development of successful multinationals needed an EDB, the success of a vibrant local enterprise sector needs a similar agency. Leading an agency should be an Executive Chairman withthe stature and calibre of Philip Yeo or Teo Ming Kian.

Sir, the third ingredient is access to financing, and this is my favourite topic. I

So, in conclusion, Sir, developing localenterprises as the stabilising base of our economy will take at least 20years. Taiwan has a headstart of about 20 years. The trick now is to accelerate the process and not take 20 years like Taiwan did. We should commit the same billions of dollars to developing local enterprises as we did to build GLCs and multinational companies here in Singapore.

Sir, building on the qualities that have transformed it in the past, Singapore must move ahead with the necessary structural changes to its economy. The lessons learned forced us to pursue self-renewal as we did andwe are starting to do. We must not abandon our objectives set out at the beginning of this millennium. I urge the Minister tolook upon local enterprises as an emergent force and develop this element of our economy to its fullest potential. If, like Taiwan, our local enterprises will employ around 75-80% of

Sir, with this, I support the motion.

initiatives and to achieve their targets, for example, in retraining incentives or the R&D grantsthat were given out to companies. It is a lot more easier for Government officers to deal with a few big companiesand dish out bigamounts of money,to say that they had already spent $100 million on R&D, than to go after many small companies who may apply for half a million dollars each.I think thisattitudestill remains and we really need to change this so that everyone is really motivated to support local enterprises. Andone way to do it is to change the way the performances are measured. So, instead of measuring the amount of dollars dished out, we may want to talk about the number of companies supported.amount for IE Singapore. But comparing operating budget is a red-herring. If weexamine the sizes of the funds that are assigned to EDB to administer, as compared to those assigned to IE Singapore or SPRING, we again find that there is a large disparity. I got some information again by reviewing the Budget book and a few other resources. There are many funds established by the Government to spur economic development. Among these, I found that SPRING has abouthalf abilliondollars under the Enterprise DevelopmentFund, but EDB has around $2 billionunder the Economic Development Assistance Scheme, $2 billiondeployed under the Technology Investment Fund and another $6 billion under the Cluster Development Fund. There are also other venture funds managed by EDB's investment units. So compared to EDB, the other agencies look like very poor cousins, I would say, when fund allocation is concerned.talk about it every year. While a lot has been achieved in the area of financing, there must be no let up in introducing even more financing tools. I believe that there is an abundance of financial tools. This would eventually help the development of our local enterprises even faster. There are still gaps in the access to financing. We are improving ourselves and we should continue to explore some of the financing tools that are used in the US, Taiwan and Israel. There are many good examples to follow. I am personally involved in driving this financing effort here and I am optimistic that very soon we, in Singapore, could call Singapore a land of opportunities as far as financing is concerned. But I ask the Government not to slow down or dilute its support that is given to the Committeefor the work it has done in this area of financing for entrepreneurs and local companies. I would not go into the details of what these tools are but perhaps during the Committee of Supply debate.the workforce one day, we should be alarmed that we are not sufficiently structured for it. We need to learn fast, to restructure the economy, and I am confident that we will get there if we keep the momentum.

(In Mandarin): Mr Speaker, Sir, I welcome the Budget for 2005 proposed by the Finance Minister. To me, this is a budget that aims to take care of as many different groups of people as possible and, of course, it must be within our means to do so. Clearly, the Government is taking a targeted approach in helping tobuild up our economic capacities to help the young, the elderly, the workers, the needy families, our medical needs, our education and our retirement -all in, to help build an inclusive and progressive nation.

Taking a focused approach in helping fellow Singaporeans is important because this would help to make sure that people who really need help would get it and this would avoid the problems of a welfare state. It also helps to better use our resources to meet the many needs of all Singaporeans, as Singapore restructures itself to enter a new phase of development. As described by my parliamentary colleagues, Dr Magad and Mr Inderjit Singh, many people have said that this is an election year budget. I had actually checked the budget summaries for the years 2002-2004. I could see that there were also many rebates, a lot of goodies such as ERS, New Singapore Shares, CPF and Medisave top-ups and other rebates or fund transfers related to education, skills training, needy families, medical and utilities. Now, if these goodies are provided by the Government this year and people therefore say that this is an election year budget, then what about the budgets for 2002, 2003 and 2004? Was the Government having an election then? Surely not!

Mr Speaker, Sir, the success of an election depends very much on the daily groundwork we doat our constituency, as a Member of Parliament, and how to win the confidence ofthe voters in our constituency. What I have found out is that the Government's budgets over the last few years have been consistent, aiming to make sure that Singapore succeeds as it transforms itself and takes care of the short and long term needs of Singaporeans, so that no one is left behind.

Let us look at the governments in the other countries. Not many countries are able to reward hard work and excellence and keep their taxes low and have a government that is lean and effective, and build up sound economic and social fundamentals and go all the way out to help the needy and the less fortunate in the society. Why are we doing all these? I believe it is to build up a progressive and cohesive nation.

Now, if we ask any workeron the shop floor, "If your company makes profits, would it share its profits with you, like what the Government is doing - by sharing all the fruits ofits success withits people?" I am sure they would say it is impossible. Yes, the Government is able to share its surplus of $13 billion with our people, and this is not something which all the countries could do because our Government knows how to make use of its surplus to serve the people. Like in the Chinese classic, Da Xue, it says,cai ju min san, cai san min ju,that is, when wealth is accumulated with the government, the people would be dispersed; but when wealth is shared with the people, then the people would congregate. So it takes a good government to know how to do this.

Mr Speaker, Sir, the Government budget is a serious business and it must not be viewed as just an election tool. Although I am not very familiar with the

Having said that, we need to build up the character of self-reliance among Singaporeans. People must play their part. If this is not the case, then no matter how much surplus we have, it is never enough. There is a limit to how much the Government could do to solve all the problems facing an average Singaporean. It is like one of my residents who came to me the day after the Budget was announced and said, "Mr Ong, the media says that this year's budget benefits everyone. Where is the money? The money goes to all the various accounts. You can see them but you cannot use them. There is still no money, no cash in my hand!" So, can you satisfy everybody? Can you have a budget that satisfies everybody? This brings home the point that the Government should continue its targeted approach to help Singaporeans and continue to put in more resources in the Lifelong Learning Fund and re-employment assistance programmes. We must help those who are unemployed so that they could stand on their feet again, and this is very important.

Mr Speaker, Sir, it is equally important to make sure that these skills training and job re-creation programmes would help those people who require the help most and make sure that they actually benefit

Here, I would like to raise another point on these job assistance programmes. Many elderly workers, who are less educated, have been telling me: "Whenever the Government recommends jobs to us, these are all very low-end jobs like cleaners, gardeners. IfI wanted these jobs, I do not need the Government's recommendation. I could easily get them myself. Why should the Government spend so much money to help us get these jobs? Why does it not just distribute the money among us?" And they also said: "You know, forthis type of job, you get only $800 to $1,000 a month. Is it enough? You have to pay for utility bills, the children's bus fares, school fees, and after I have paid all these fees, I would have nothing left for myself." Mr Speaker, Sir, these are not very pleasant remarks, but these are practical concerns of the elderly and the less educated workers.

So I would like to urge the Government to give priority to assist those people who are willing to take up low-starting salary jobs but who are unable to make ends meet. The Government should create some incentives to keep them at work so that

situation in Taiwan, I have read the newspapers about its political situation. For them, to become Members of Parliament, they have to spend about S$10 million, and so everybody thought that they would have to have more elections and then everybody would have some income. Now, if Singapore is like Taiwan, then I hope that maybe we should have elections every half a year, so that everyone would have some good income. So, I think this is a serious matter and we should look at it very seriously. from them. If we are just looking at some overall statistics to evaluate the effectiveness of these programmes, sometimes theremight besome error because there is a strong tendency for officers on the ground to focus on those sectors which contribute to their KPIs and neglect the people who really need their help. We need to know who these people are, what are the jobs that they have been placed in, and whether this is sustainable, without unrealistic subsidies given out to the businesses from the Government grants. And, more importantly, could these people really stay on and benefit from the programmes and would not leave the job after collecting some subsidies?they would feel that it is meaningful for them to continue workingandthat they could gradually progress and earn higher salary and would be able to stand on their own feet.

We all know that there are always ups and downs in the economy. It is not possible for us to enjoy good surpluses year after year. This is life. However, it takes a good government to be prudent so that during good times, it will be able to respond swiftly.And during bad times, it will be able to build up strong fundamentals and policies, and create opportunities for all and take care of the less fortunate ones among us.

I read in the newspaper that nowadays some young Singaporeans are no longer interested in the same old story of how the old guards built up Singapore to where it is today. They feel that we are just trying to blow our own trumpet. But if you ask me to choose between some unrealistic ideals and a good government with sound policies, I would choose the latter, because it is a better bet for a brighter future for our children. I still believe that we need to know how our first generation leaders built our nation,the passion, the hard work that they had put in. It is from our history of nation building that we know the strengths and weaknesses of our nation. It will remind us to cherish what we have now and to stand on realistic grounds when we seek to build a better future and never lose touch with realities.

It is quite common sometimes to hear our children saying, "Daddy, your father was poor but my father is not poor. So during your younger days, you had a hard life. You were not able to enjoy all the material comforts that I have now. That's too bad. There is nothing we can do about it. I sympathise with you." Because our father was poor, so we had a bad life. But now we have better income and our children are enjoying themselves.

Sir, all in all, I would like to conclude by thanking the Finance Minister for the prudent and compassionate Budget 2005, and I give full support to it.

So, as a parent, we should remind our children. We should tell them that we should not take this for granted.We must correct them.We must educate them. Only thenwhen our children grow up and when they are leadersin any field, they would know what is the proper way of thinking.

Thank you, Mr Speaker, for allowing me to join in the debate.

Sir, the Prime Minister and Finance Minister has outlined two broad objectives that underpin Budget 2005 -creating opportunity and building community. Both of these are laudable objectives which are deeply intertwined. It is difficult to create and sustain economic growth and opportunity without the foundation of a strong community and families making up our social fabric. Yet, without economic growth and the opportunity it offers, our social fabric will certainly be tested and may even unravel.

Sir, in addressing these twin objectives, the Finance Minister has adopted a cautious if not conservative fiscal stance. I am in support of this prudent fiscal approach and this is where I differ with my colleague, Mr Inderjit Singh.

Sir, what marks a good fiscal policy is a subject of learned debate among economists. But as a student of economics and as a lay practitioner, it seems to me that, ultimately, fiscal policy is best judged by its responsiveness to the economic conditions within which it is formulated. Mr Inderjit Singh cited the example of Mr Alan Greenspan and I think that is a very good example. I do not think he is noted for sustained interest rate reductions. He is noted for both

Why do I support a prudent fiscal policy at this juncture? We have had 8.4% growth last year and the forecast for this year is 3-5%. This is within what we consider to be the long-term achievable growth rate for Singapore of 4-6%. That would suggest that, at this juncture, there is no need for additional fiscal stimulus to pump the Singapore economy. I leave aside the entire argument about how effective such a fiscal stimulus would in fact be in promoting economic growth in Singapore as opposed to external factors. But, in addition to that, I believe that adopting this cautious stance now leaves us with the room and flexibility to respond if there is a greater challenge, unexpected exogenous or external developments that might arise in the course of this fiscal year or later. And I think that will be the true test of the responsiveness of the Government's fiscal policy.

I also note that we have a reliance on the Net Investment Income (NII) in order to make up the operating deficit that the Government incurs. And I think it is worth noting that the expected income from net investments is expected to fall. In fact, it is going down from $2.68 billion in FY 04 to $1.86 billion in FY 05. This underscores the uncertain investment environment and highly competitive investment environment within which investments have to yield returns, and it would be wishful thinking on our part to expect NII to continue to be sustained in absolute levels or even in terms of

Sir, the measures, aimed at individuals and families, have, in general, been well received although, as with any other budget, there has always been the request and expectation of more, but I believe these measures will go a long way in helping Singaporeans in their daily lives. I wish to highlight three aspects which struck me as noteworthy or worthy of comment.

The first pertains to the refinements done to the Baby Bonus Scheme and the $50 reduction of foreign maid levy. To me, this demonstrates that this Government has its ears to the ground, listens to feedback and responds with appropriate policy adjustments and, indeed, the Prime Minister said so during his speech. The Baby Bonus Scheme refinement is a case in point.It is farbetter for the Government to just determine the cap, the total amount of benefit we wish to confer on young couples who have children in response to Government policy pronouncements as well as their own instincts, and leave it to them to decide how they want to accumulate the savings, rather than prescribe a straight line or a six-year time horizon within whichto accumulate. I think these kinds of adjustments are important because it demonstrates that the Government is listening and will continually respond to enhanced policies.

Sir, the second aspect is on the transfers to Medifund and the Lifelong Learning Fund. I believe it is $100 million to Medifund and $500 million to the

Sir, the third aspect is on the ComCare Fund. The Finance Minister has announced the initiation of a ComCare Fund with $254 million allocatedto it this year. I think this is a very good gesture because it is aimed at helping those affected by retrenchments and families that are disadvantaged and students who are part of those families.

My main point on the ComCare Fund would be that it should adopt three important principles in the way it runs and administers the Fund. The first is decentralisation. It must be devolved as close to the ground as possible because that is where the greatest awareness is of

The second is that the Fund must be flexible in its administration. The reason I say this is because I think it is important that any fund with this kind of allocation of funding must have schemes because that ensures a certain discipline and process. But it is difficult to put everybody in our specific pigeonholes and say, "Well, you fit this category and therefore you get it. If not, you don't." So I hope that that flexibility will be allowed right down the line so that the officer on the front line can exercise his or her discretion in deciding whether exceptions or variations can be made.

The third is utilisation. We should not, having allocated this sum of money for this good purpose, be reluctant to fully utilise the funds. Our traditional concern has always been about breeding a crutch mentality with handouts, and I think that is a legitimate concern. But if a need is clearly and unambiguously established, then we should not be shy of giving the necessary support on a regular and timely basis. After all, that is the intent and we would be failing if we did not live up to that objective.

Sir, let me finally turn to a topic on which my colleague, Mr Ong Ah Heng, has also spoken quite passionately on, ie, about older workers or, in general, older Singaporeans. It is my view that we need a high level, comprehensive Government response to address the needs and concerns of older Singaporeans and older workers. We call them older workers when we talk about employment issues and job market issues. We talk about them as older Singaporeans when we talk about social issues, but we are talking about the same group of people.

What are their concerns? We see them every day or every week at our meet-the-people sessions. And upper

interest rate increases and reductions done in a timely and calibrated manner in response to economic conditions, and bearing in mind that Government policiesebb with a lag on the economy. So, today's fiscal stimulus would probably have an impact, at the earliest, six to nine months from now. So I think we need to think ahead.growth. I think we need to be realistic that there is going to be significant variations year to year in Net Investment Income and the operating budget of the Government must take that into account. So I believe the Finance Minister has correctly adopted a carefully calibrated stance leaving the Government room to respond if and when a need arises.Lifelong Learning Fund. These endowmentshave always been welcome initiatives because they help Singaporeans with their medical needs and also in their adjustments to the economic environment through retraining, etc. But to many Singaporeans, these endowments remain opaque, high-level budget items - "special transfers" as they are called in the parlance of the Budget. Singaporeans do not fully comprehend or appreciate how these endowments have been benefiting the average Singaporean in need. I would urge the Government to ensure that adequate information is given on a periodic basis, regularly, so that Singaporeans understand how much of these funds have been used, who are the beneficiaries, giving a profile perhaps by age group or social economic background, and what sort of circumstances they have been helped in. The reason this is important is because otherwise, these endowments remain, in a sense, notional allocations. Nobody really knows how they work in practice, whether they are working in practice and how they help Singaporeans in practice. So I would request that we have further information on this, because I believe it will go a long way in assuring Singaporeans of the usefulness and the value of these endowments to them as individuals.the need and the greatest accountability can be accomplished and the greatest speed of response can be achieved.most in their minds are three issues - employment and income, housing and medical cost. If these three aspects are taken care of, most of our older Singaporeans would have a much happier life. When addressing the issue of employment, many Singaporeans who are in the 40s and 50s have lamented to me that they feelthe retirement age today is no longer 62, and even if the Government talks about extending retirement age, they feel that the de facto retirement age is actually 42 or 45. Because if you get retrenched or lose your job at that age, it is well near impossible to get meaningful re-employment. They feel that their employment prospects are poor and even if they get jobs, they might be low-paying jobs, as Mr Ong mentioned as well.

New jobs that are being created as Singapore restructures and rationalises are in sectors which are, quite frankly, difficult for them to adapt to. For example, if you take the pharmaceutical industry and its sterling growth and the investments that are being put in in Singapore, how do older Singaporeans take advantage of the opportunities in this sector? It is certainly a challenge even if they go for much training.

And, certainly, it is no longer anecdotal because there is a pattern that employers prefer younger workers to older workers. I recently spoke to a 49-year old constituent. She has had 25 years of clerical work experience in a large company and then she was retrenched. She says that, today, at 49, she is not able to get a job as a clerk in any organisation. She is now working as a security officer. This exchange left me wondering. Do we celebrateher flexibility and adaptability to the opportunity in the job market and, also, the flexibility of her employer who has taken her on, although she hasno obviousbackground in security services? Or do we instead voice concern

On the aspect of housing, for older Singaporeans, it seems to me that the conundrum is they are either locked in to housing loans or they are unable to unlock the value in their homes. The only option is really to sell. But ifthey sell, then the question is where dothey stay? Dothey stay in studio apartments that HDB provides? Dothey go for rental accommodation?Or, what would be the ideal solution for the elderly to be able to continue to live where they have always been in the last two orthree decades?

Sir, the reverse mortgage scheme that the private sector has undertaken attempts to do that, allows people to continue to live where they have always been but draw down on the asset value, ie, the equity they have built up in their asset, so as to pay for some of their living expenses. But the scheme has not taken off, and I think we must examine why it is so,in deeper terms, and see how we can facilitate that.

And, finally, on the issue of medical costs. We all know the story of the older Singaporeans being afraid of falling sick. And the "3Ms" have gone a long way to helping them throughschemes like Medisave, Medifund andMediShield, (with its recent refinements). But ask any senior citizen today, and they would, hand on heart, tell us that they are still very scared of being sick, and especially if it is a chronic illness, they are quite concerned. Why? They do not want to be a burdento their family and children. So what do we do? Or how can we help them help themselves?

Sir, in raising these issues, I want to stress that theolder Singaporeans I have

Sir, the Government has undertaken many steps to address these needs. They have come from different Ministries' perspectives, different departments, whether it is studio apartment type housing from HDB, whether it is modifications and enhancements to Medifund orMediShield schemes, CPF adjustments, etc, and, ultimately, of course, economic growth which would create opportunities for all is the best solution. But even with economic growth, we know that there will be pockets orgroups that will be left behind or unable to fully benefit from these new opportunities. So I feel it requires a comprehensive review and a holistic response to these challenges in meeting the needs of older Singaporeans.

Sir, I believe it is an issue of the same scale and importas procreation and it has the same kind of economic and social ramifications. It will affect Singapore for many decades to come.Also, as Mr Ong has pointed out quite eloquently, we have an obligation to ensure that older Singaporeans who have contributed and sacrificed for Singapore's growth continue to feel that they have a home and a part in Singapore.

Sir, the Government has appointed a tripartite committee, or is in the process of appointing one, to study all aspects of this. I would urge this committeeto start with a clean slate and put the older Singaporeans at the centre of the study,

If Imay offer a couple of ideas which, I believe, isillustrative of what this committee should be looking at.One of them is fiscal incentives to hire older workers, eg, double tax deductions of their salaries. Is this a big move? Certainly. Is it a risky move? Definitely. It means the Government would be entering the labour market and potentially distorting it. But this Government has never shied away from bold moves when it serves the greater good of Singapore. Already, we have policies that affect relative prices in the job market between foreign and local workers through the foreign worker levy and even between younger and older Singaporean workers through adjustments through the CPF. I believe there is enough justification for the Government to review this and consider this as a serious proposition, and whether there is scope for financial orfiscal incentives to create employment opportunities for older Singaporeans, specifically targeted at particular groups and particular sectors where job creation for this category may be of greatest value or possibility.

Another aspect is on housing. I believe the reverse mortgage scheme that the private sector has attempted has not been well received or successful for a variety of reasons, but primarily for lack of critical mass or skills.The Government, in particular, HDB, is in a unique position of being the largest landlord and is in a position to work closely with the private sector to create the critical mass to kick-start a scheme of this nature, if it is deemed to be worthwhile. And I think it is worth pursuing because economic

So these are large and complex issues. I do not mean to suggest that the solutions are straightforward or obvious, but they need to be addressed and the solutions need to be found. I am confident that we have the will and ingenuity within the Government to comeup with creative ideas.And I urge that this committee does its work expeditiously so that we can come up with announcements and policy measures in good time.

over the fact thata 49-year old, in good health, obviously experienced and well capable of handling the responsibilities and requirements of the job, is unable to secure a job in a field that she is well-experienced in for 25 years?talked to are not looking for handouts. In fact, they want to stand on their own two feet, not depend on others and live their lives with dignity. I have had 70-year olds coming to my meet-the-people session, asking me not for money, not to referthem to any financial assistance scheme, but saying, "Can you please get me a job?" And that leaves me profoundly affected because the attitude is so different to some of the younger Singaporeans we see. not look at it from the angle of what is the existing policy and framework and see how it can be modified, but rather look at it from inside out. If you are an older Singaporean today, what is your situation, what are your challenges and what would be the optimal solution, and then to work inwards from there. viability whenconsidered by the private sector is a very narrow calculation. But when you bring inthe HDB or the Government, the calculation becomes broader. And I think we will be able to see itfor what it is really worth and decide whether public sector resources should, in fact, be committed towards such a venture.

Mr Speaker, Sir, I rise in support of the motion.

Sir, our society has placed heavy emphasis on our youths and allocates much of its resources to the future generation. There has always been this utilitarian approach to life and to people in this society. However, in view of the sharp increase in the numbers of old people in the Singapore population, such marginalisation must make way to ensure all groups of our society are not being left out and are made to feel as part of our system because they matter. I would like, therefore, to urge our Government now to place more emphasis on our silver generation, as highlighted by Mr Iswaran and Mr Ong Ah Heng earlier. Sir, notwithstanding the lifelines to the old, needy and jobless, asannounced by PM Lee during the recent parliamentary debate on the Presidential Address, I would like to highlight areas that are deficient and those that can be further

Employment

The necessityfor a majority of people here to continue employment beyond the retirement age of 62 is becoming more evident. In fact, it is recommended that fresh stimulation and retraining are what all of us need in "the last years of life" to prevent mental peril. Besides, life expectancy of Singaporeans is at 77 for men and 81 for women and getting increasingly higher. Financial planners estimate that at least 75% ofSingaporeans do not have enoughsavings to maintain their lifestyles after retirement at 62. With declining birth rates, the elderly depending on children for their keep and the declining dependence working ratio affecting the economy of the country will be an issue.

I would like to urge our Government to look at the following areas to facilitate our elderly to gain employment:

Allowingfit and willing workers to continue working at their jobs beyond 62. More incentives, such as taxreductions or rebates, could be given to make it more attractive for employers to retain workers beyond the age of 62. It may be more feasible to implement flexible retirement age to get people to retire later.

Retraining of older workers has been an emphasis of our Government for years. It remains an important pillar for gainful employment for many and I welcome the new Re-employment Assistance Programme (REAP) to help those with structural unemployment. Over the years, we haveimplemented various retraining schemes and it is now time for us to evaluate the various schemes implemented so far and expand those that have proved effective to make them available to the majority. I would like to urge our Government to make it

May I urge our Government to create and incentivise more job opportunities for the older employees? For example, since we need to develop our homecare, the silver generation group is an ideal source for training to fill up the various job opportunities. Other job opportunities would be nannies for infants, tourist guides, mentoring roles, certain manufacturing jobs and part-time or flexi-time positions, and so on.

A mindset change among employers with regard to older employees must be facilitated. Most studies on mature employees indicate that they are likely to stay with their companies much longer than their younger colleagues. On technology generation gap, studies have shown that mature employees can muster the same information as their younger colleagues and can apply this knowledge equally well. In some cases, mature employees can actually get extra mileage by applying new information more effectively because of their experience. We need to debunk the perception

improved on to better the lives of the silver generation.more attractive, especially in terms of financial assistance, for more people to take up retraining opportunities. Often, the lesser take-up rates were due to lack of suitable matching job placements and inappropriate expectations of both employers and employees. We need to evolve a better synchronised system to ensure higher success. More efforts are also needed to actively promote and encourage all those eligible to ensure that no one is left out due to unawareness of such schemes being available.

that once people hit a certain age, their bodies and minds go into such decline that the workplace will benefit from their departure. Most people today live well beyond 62 years. Many mature workers are in fact in their prime, in terms of knowledge and creativity. Mature workers represent an available resource to be tapped in order to benefit our nation in this century.

Financial needs

Sir, rendering help to those in their 50s to 80s with no job, no CPF and nobody to turn to is now crucial. I hope ComCare funds can be channelled to especially help this group of people. Women are especially vulnerable. Over 90% of women, aged 60 or more, have less than secondary education and, therefore, fewer work opportunities. Previous reports have also shown that 54% of elderly women here are widowed, slightly more than three times the proportion of elderly men. According to the Department of Statistics, there were 290,200 women above the age of 60 in 2003.

Many of the poor, especiallythe elderly,are often ignorant and isolated from the help that they are eligible for. According to a survey by the Social Development Feedback Group, only three in 10 households living in one- and two-room HDB flats are aware of financial assistance schemes. There should be a central register for our destitute, chronic poor and disabled, so that effective and thorough assistance can be given to them without anyone falling by the wayside. We need to have more social workers working in conjunction with grassroots and voluntary organisations in the community, trained to engage and follow up on those in this register.

There is a slew of schemes available to help those in financial hardship. There are too many schemes presently, and this makes them difficult to follow and administer. Sir, we have to consolidate them and make them more comprehensible.

We need to vet through the various schemes available to remove stifling benchmarks and blanket rules, and to

In 2000, the total CPF funds for women aged above 40 were $19.9 million and $33.1 million for men. As of 2003, only about 40% of active CPF members who turned 55 met the Minimum Sum. Of these, slightly more than half had set aside no more than $40,000 and had to pledge their properties to make up the shortfall. Like my parliamentary colleague who spoke earlier, Mr Iswaran, may I urge our Government to give HDB cash-poor retirees the option of reverse mortgages? This facility will allow the elderly to pay for their daily living, remain in their own homes, and lead less disruptive lives. There will be fewer cases of bad management of funds from selling their HDB homes. This will also lessen the demand on HDB rental flats.

Sir, Singaporeans fare badly in saving for retirement. Could our Government make the Supplementary Retirement Scheme (SRS) more attractive to encourage more to save? Presently, the withdrawal of SRS with tax waivers allowed onlyfor death or being bedriddenis too restrictive. Situations for tax waivers should be broadened to include conditions that cause people to lose the ability to work for their livelihood prior to the minimum withdrawal age. Also, at the point of withdrawal, the capital gains part of SRS should be waived from taxation.

Financial planners say that Singaporeans desperately need to know

Housing

Sir, better planning of the housing needs of Singaporeans is necessary. About 12% of all households now are headed by persons over 65 years. In 2000, just over 7% of Singaporeans were over 65. By 2009, it will be 10% and, by 2016, 14%. Should there not be more three-room and two-room HDB flats being built in view of the trend in recent times when we see more downgraders than upgraders?

There should be more HDB flats being built or improved with elderly-friendly features. These elderly-friendly features are essential to enable the elderly to live independently in their own homes for as long as possible. May I also ask our Government to consider building new HDB flats with "Lifetime-designed HDB Homes" concept, so that such flats can be adapted as needs arise to allow people to "age in place"?

It is essential to ensure that there is a priority in getting the various Ministries to always have the elderly and handicapped in consideration in all planning, to make our living environment, roads and public transport more elderly-friendly. Sir, for many years, our public transport system has not been user-friendly for our physically challenged residents. We need a revamp here, as our policy will determine the independence of those with mobility difficulty.

More studio apartments and retirement homes will be needed to better accommodate the silver generation.I would like to urge our Government to set

Sir, may I also urge our Government to be less stringent on the HDB's Joint Singles Scheme? I am not suggesting that we convert all HDB rental flats to only "Singles Schemes". Many lessees may prefer to rent with spouses or other family members for companionship. But let us be flexible to those with no family members or friends to share with. It is very difficult for many singles to comply with this ruling by requiring them to live with complete strangers.

I welcome PM Lee's announcement on faster upgrading of HDB lifts. May I suggest that priority be given to those HDB flats with a higher percentage of elderly residents to get earlier upgrading?

Healthcare

Sir, better policy planning is needed on the medical needs of the elderly in the next 10 to 25 years when the elderly population will increase from 14% to 20% of the population. The ratio of the elderly to the working-age population (the old dependency ratio) is set to increase dramatically. This shift will likely to have significant consequences onhealthcare demands, especially so when severity of disease and disabilities increase with age. We must cushion the future burdening effects, and that requires pro-active actions especially during the years of budget surpluses from good economic times. At any one time, it is estimated that 2.7% of the elderly will require institutional care, while another 5.3% will require community-based care. On this basis, it is projected that we will have to provide for about 800,000 elderly in 25 years' time. The various healthcare services, such as acute hospitals, nursing homes, day centres, community care centres, will then have to be increased

Homecare

We need a coordinated plan in place to deal with the ageing problems more effectively, and this is especially so for the non-ambulatory elderly. Presently, there are at least 20,000 semi-ambulant and non-ambulant elderly that require assistance in their care. Homecare should be givenpriority, as homecare in Singapore is at its infancy. Homecare is the care of the semi-dependent elderly to enable them to live in their own homes for as long as possible with appropriate support. Homecare translates into convenience and much lower costs for many and, hence, a happier populace. This area needs urgent priority for the following reasons:

Institutional care is costly and causes loss of independence;

The family unit, with adequate support, is a principal way to provide care in the home environment rather than institutional care; and

Careful pro-active planning and actionare nownecessary, in view of the fast-ageing population, to minimise hospital admissions and dependence on long-term care in institutional settings.

Sir, many low-income families will benefit from the Elderfund or ComCare funds that help them cope with loss of income when people give up their jobs to look after the dependent elderly. Most caregivers in the community are family members and maids. They should be given the proper know-how and homecare support. May I also urge our Government to consider doubling the dependant's tax relief for aged persons 75 years and above, to help families meet the greater

The Ministry of Health must strive hard for seamless integrated care services for all elderly patients discharged from public hospitals. This is necessary to coordinate and facilitate placement of patients to step-down care facilities that look into the multi-faceted medical, social and psycho-socio needs of the patients. At any one time, there would be some 8% of the elderly that require step-down care of varying levels of intensity. Currently, there are multiple service providers with minimal coordination. There is a need for better coordination and effective implementation of the various healthcare services. Many caregivers are also not aware of the existing services, or how to access these services.

Preventive healthcare

Sir, everyone accepts that health promotion and disease-control strategies to enable the elderly to remain fit and active in the community are the most effective ways of getting the best outcome from an ageing population. It is time that we prioritised this area by setting up Centres of Activity, at least one per constituency. These centres aim to keep the mobile elderly fit and healthy for as long as possible. This concept of maintaining the physical, mental, as well as the social well-being of the elderly should be promoted island-wide on a big scale and made available to our elderly whilst they are still well. Such centres can be set up at the community centres or

Sir, early preventive measures are preferable and more effective than later interventions at points of crises. This follows the dictum "prevention is better than cure". In view that life expectancy is at an average of 79, it is a worthwhile effort to have programmes assisting our elderly lead healthy lifestyles and providing more preventive care for our elderly. An important message for this target group will be "disabilities in old age are often due to disease, and early treatment of the disease can prevent disabilities". On this premise, it is necessary for MOH to ensure that those with diagnosed chronic diseases can get their regular long-term medications. Chronic diseases are a big problem to the poor, as they have limited resources. By "stinging" on the required regular long-term medications, they end up with more diseases that cost them and the society even more in the end. It is thus necessary to make currently excluded "chronic diseases care" available to those eligible poor elderly in the Primary Care Partnership Scheme. Sir, I wish to declare that I am a doctor participating in this scheme.

All in, preventive care, community support services and appropriate rehabilitation not only help prevent unnecessary hospital admissions, but also

Medical costs

Many Singaporeans are concerned about rising medical costs, and this is especially so for the elderly folk in our midst who have no income but have increasing medical needs. In time to come, this increasing burden will affect even more people due to our fast ageing population. I welcome the newly renewed MediShield scheme, but I would like to urge our Government to ensure better take-up rate, especially by those poor and elderly. More publicity may be needed to get more of them on board. I am glad of our Government's assurance that no Singaporean will be denied of any medical treatment as aresult of lack of means.

factor in the complexities of individual needs so that fewer people fall through the system cracks. For example, we cannot always presume that the aged will receive care from their families. Although 86% of older women live with their children, volunteers say that many, especially those in poorer households, put their own needs aside as they do not want to impose further burdens upon their families for various reasons. how to invest their money. With many of our people advancing fast in age, it would be prudent to better prepare them for their retirement. Much more should be done to teach financial literacy in the community settings.aside designated lands for this purpose. It may be more feasible to allow 30 or 40-year leases to private-sector enterprises to make retirement villages viable.three-fold to cope with such an increase in the future. I urge our Government to ensure that we do not leave it too late for this provision in the coming years.cost of looking after this group in their homes? Comprising more of the frail elderly, this group is the one most likely to depend on more healthcare and social services.Sir, there is also a need for more Community Care Centres, such as "Day Rehabilitation Centres" and "Respite Care Centres", for the semi-dependent elderly to remain in the community.RC centres. By paying a reasonable and affordable fee, the participants sign on at a convenient precinct-located Centre of Activity for the Retired and Elderly (CARE) for their daily exercises, wholesome meals, social activities, learning new hobbies, outings and health education talks. I am convinced that the way to go is to have more such CARE to keep our retired elderly healthy and happy. I hope that such centres can be set up and supported by both MCYS and MOH, and involving the grassroots groups and other volunteers from the community. I hope ComCare funds can be used to fund such centres island-wide. improve quality of life in the elderly. Sir, I am not advocating adding years to life, but life to years.

It is therefore comforting that the Medifund isa safety net and will be increased to $2 billion. I hopewe would not take too long to reach this amount and seize the good economic years to top up more, as $100 million per year would take us 10 years, not discounting some unfavourable economic years. Iwould also like to urge our Government to approve all the deserving applicants of Medifund and even those who may be in the sandwich group but have exhausted their means.

Elderly abuse

Lastly, I would like to talkon elderly abuse.There are 100 cases of battered and neglected elderseach year that came to the attention of welfare groups and medical authority in the past five years. Half of these cases of elderly abuse were the victims of their own children. It was reported that these cases were just the tip of the iceberg as most cases were not reported. Sir, why should elderly abuse be treated differently from child abuseand wife-beating in our laws?

Presently, the authorities canintervene only if the abused elderly person or a third party has applied fora protection order under the Women's Charter. I would like to beseech our Government to change our laws to empower social workers, doctors, family members and homecare givers to protect senior citizens from abuse, asmuch the same way as they can intervene onbehalf of abused children. Sir, we need better laws to protect the abused elders as many of them arehelpless for various reasons such as shamefulness, total dependency on the abusers who are the sole care-givers or due to sickness or dementia.

We also need to review our laws to prevent financial abuse. For example, banks should be allowed to intervene when a staff suspects that an older person is being defrauded offinancial assets. Sir, it is timeto recognise this social ill and implement measures to address it. Public education should be stepped up on the various kinds of abuses such as physical neglect, assault, psychological and financial abuses.

Sir, I would like to conclude by beseeching our Government to helpdispel the view ofageing with despondency and decrepitude, to assist the elderly live purposeful, useful and healthy lives and to enable them to live their lives with dignity and age gracefully.

Mr Speaker, Sir, Singapore currently faces trialsposed by both globalisation andmore intense foreign competition. This unprecedented combination of challenges to our economic fundamentals and economic growth has resulted in a"perfectstorm" forour country and constituents alike. Growth has happened inthe view of the Government and its statistics. However, economic growth has not trickled downand been felt by

For those more experienced Members of the House, I am sure they will remember the nature of cases we saw during our MPS 10 years ago and the cases we see now even in the midst of the "growth".In the past, the complaints were about people having the money, wanting to buy bigger HDB flats and chasing HDB to get their flats "very fast",constituents griping about cars being too expensiveand of maid levies being too high.

Today, we see constituents who are behind in their HDB mortgage payments and who say that they are being chased "very fast" by Singapore Power because of their arrears. They are no longer seeking to buy bigger flats, but are instead requesting to downgrade to rental ones. They are also no longer complaining about maid levies which have, in fact, at long last, come down. But they are unable to pay for basics like water, electricity and conservancy charges. Sir, the contrast could not bestarker.

I would urge the Government to look beyond the economic statistics and see the human costs that restructuring and changes have imposed on the less skilled and the less well-educated.

This Government has an in-builtphilosophical aversion to direct "welfare"for fear of an erosion inwork ethic. That fearwhilst correct, when faced with full employment and sustained high economic growth, is irrational when we are confronted with permanent structural unemployment and periods of volatile economic growth. For far too long, the Government has treated the term

Mr Speaker, Sir,a government and its people and whether they are perceived as a great nation is measured not only by the number of patents, the efficiency ofour airportsor ports, but alsoby how we, to quote the Prime Minister, succeed in "building a community". But what is a community? What defines a community worth living in, growing old, fighting for, andperhaps some day worth dying for? What is there beyond the five "Cs", as articulated by the Remaking Singapore Committee? The answer, I believe, lies in helping those who have been left behind.

The Government has accepted growing income disparities as the price of economic growth and success, but I believe that to be united as a nation, a people and a community, there should be an explicit social compact whereby those who succeed help in some form those who fall behind through general taxation. A critical part of that social compact andsocial cohesion, besides a comprehensive social safety net, is the sacred duty of every government to provide basic affordable healthcare for all.

For a long time, the Government has treated healthcare not as an investment akin to education, but as "consumption", something which, if the gates were swung open, would lead to a ladder of escalating healthcare costs. Basic affordable healthcare is an important part of the social compact between the Government and its people, between the young and the old, and between the employed and the unemployed. I would say that healthcare is a social investment akin more to home ownership, of which we are so proud as a nation.

The Health Minister has called forthe implementation of means testing for "C" class wards. I know it will not be implemented this year, as the Minister has just said in his answer to an oral question. The details, as it stands, are unclear,as to the mechanics andthe quantum. I am against means testing for class "C" wards because I believe that basicaffordable healthcare is one of the fundamental duties of a government on behalf of taxpayers.

Mr Speaker, Sir, we have pledged to be a united people, regardless of race, languageor religion, so as to build a just, equal and democratic society for all. I fail to see how discrimination in something as basic as healthcare in the form of means testing will go in any way to build that just and equal society. It will instead serve to erode that unity within the community. If the Government chooses to go ahead with means testing, then I would argue that it has to be designed such that if subsidies for a particular income group decrease, so, likewise, there should be an increase in the subsidies for the less well-off. In essence, froma revenue point of view, it cancels each other out so that, at least, it makes it "redistributive" rather than "discriminatory".

Sir, the Government has also signalled its intent to return to a modest surplus budget for FY 2005, in thebelief that the economy hasturned a corner and we are back ontrack for another period of steady economic growth. I wish to remind the Government that this economic growth takes place within the context of the lack of"trickle down"anda structural unemployment rate of 4%. I believe that this celebration is premature. We should not count our chickens before they are hatched, as a longerperiod of sustained growth of 5-8% is required to bring back a general feeling of prosperity and confidence to the economy as a whole.

I fear that because the Government has that "feel good" attitude, it would justify to itself the necessity to raise fees and charges with the rest of the corporatised public service providers following suit. Whilst the Government may "feel good", the people are definitely feeling less than good and will feel very bad if the prices of public services rise.

Sir, behind the "feel good" economic projections and statistics, there lies another set of numbers which urges us to do more for those being left behind.

According to the Straits Times' report of 26th February, there was an increase in the number of people seeking financial aid from the CDCs, from 14,300 to 31,570 between 2001 and 2003, an increase of children benefiting from the Straits Times Pocket Money Fund, from 3,735 to 10,419 in the same period. Another article on the same day also stated that 70% of those in 1- or 2-room flats had no idea of assistance schemes, even though 60% of them described themselves as in financial difficulties.

The 2000 Census showed 12.6% or 116,000 households had incomes below $1,000 per month. Since the last census, I believe the numbers have increased. We have an increasing number of people who need help but we also have increasing numbers of schemes and funds to help.Yet, at the same time, an astonishingly high percentage living in 1- or 2-room flats have no idea how to access to the help being provided for them. I would call on the Government to reach out better to these people who need help.

many people. This is made worse by the volatility of economic growth and the shortening of business cycle."welfare" like a dirty word. They call their schemes "HOPE", "Public Assistance", "Work Assistance" when, in fact, they areakin to "welfare"by any other definition. With the ComCare Fund, Sir, I believe there is more that the Government can do.

Mr Speaker, Sir, first, I would like to take this opportunity to address a few issues that Mr Low Thia Khiang has raised.

First of all, Mr Low was right that the success of the Government should be measured by how it takes care of its community. Indeed, the Government has taken care of its community and, in fact, the Government's effort in looking after the needy is demonstrated by this generous Budget that is tabled before us.

Mr Low also expressed some concerns on the rising healthcare costs. Yes, healthcare is not cheap and it will not be cheap as the quality of healthcare improves. But it will always remain affordable -that is the promise that is given by the Government. Mr Low objected to means testing on one hand but, on the other hand, he advocates that the more successful should be taxed more in order to subsidise the less successful. Isthis notwhat means testing is trying to do - to measure the success of the people and to ensure that our subsidies are targeted specifically at those who need these subsidies more?

Sir, to Mr Low and some people, maybeBudget time is a time to dish out goodies. But, Sir, this is not the time to dish out goodies. The Budget is a very serious affair. In fact, this Budget reflects the Government's philosophy under the new leadership. The Prime Minister has stated very clearly that the style of his Government is one of caring and inclusive, while creating opportunities for Singaporeans. This is the main thrust of this Government's financial policy this year.

Sir, I agree with the key policy directions and these could be broadly categorised into three categories and these are: responding to the past, taking care of the present, and preparing for the future.

Over the last few years, Singaporeans have rallied together to support the

However, not all of us have emerged unscathed. In fact, we must recognise that some Singaporeans who have been affected by the prolonged recession have not totally come out of it yet, even as the economy recovers. In particular, the older workers are still finding difficulty securingand retaining jobs. They need help and we must continue to find ways to help them effectively.

I am glad that the Government has introduced the Re-Employment Assistance Programme (REAP). I hope that the relevant Government agencies would work closely with the NTUC and CDCs to administer the scheme effectively so that workers could benefit from it. I would like to urge the Government to give special attention to the older workers as they would need more help to re-enter the economy. To a large extent, this requires a mindset change among the employers as they are the key decision makers in the process of employment. If the Government could consider some financial or tax incentives for the employers, it might help kick-start the process.

As part of the caring and inclusive approach, we must share the fruits of our labour withfellow Singaporeans. Towards this end, I am pleased that the Government has decided to provide top-ups for Edusave, Medisave, Medifund, CPF for the older Singaporeans, as well as

Sir, next Iwould like to talk about taking care of the present. While we address the issues that arose from the economic recession and recognise the past efforts of the people by sharing with them the fruits of our progress, we must also be mindful of the present problems and difficulties that are faced by Singaporeans today, one ofwhich is the cost of living.

Although the economy has done well last year, it would take time for the recovery to translate into higher salary, better bonuses and increases in asset value. It would take time for the economic growth to bring about creation of personal wealth. Yes, the standard of living has improved compared to 10 years ago. Yes, many Singaporeans own a handphone today and many households own a PC at home. However, many of these items, which were considered luxury goods once upon a time, have now become basic essentials. Handphones, for example,are almost indispensable in today's fast moving world, whether you are in business or a factory worker. These all add to the household expenses. Although the CPI indicates that inflation is low, the reality is that household expenses might have gone upsimply because of rising standard of living. People are feeling the pinch as they try to keep up with the standard.

The top three concerns among most Singaporeans are healthcare, transport and utilities. On healthcare, I am pleased with the efforts by the Ministry of Health in containing cost increases. With the publication of hospital bills, the institutions are put on the defensive to ensure their operations are cost efficient.

Whatis of greater concern are the utility and public transport costs. The new formula on the price adjustment cap would provide more flexibility in both directions, up and down. But with rising fuel prices, I am concerned that the Government maybe considering raising utility rates and bus fares in the short term. I hope the Government could delaysuch increases for as long as possible until the benefits of economic recovery have filtered down to the people.

Next, helping the SMEs and local enterprises. We must also take care of the local small and medium-sized businesses. Some of them, the neighbourhood retail shops, for example, have suffered significant losses over the last few years. They struggled to stay afloat, hoping that business would recover soon. The loss carry-back scheme is a bold attempt to help these companies, but it would be most disheartening to see their hope being dashed simply by rental increases. Perhaps the Government could consider extending the rental rebates for a while longer so that they would have a chance to recover their losses and rebuild their business.

The SMEs could not be ignored. They still form a significant part of our economy. We need to keep them going and help them restructure and grow.

In line with our mission to create a caring and inclusive society, we should provide support for the less able and the less privileged among us. These include the lower income families, the older Singaporeans and the disabled. The

Sir, next, I would like to spend more time on the more important aspect of the Government's financial policy, that of preparing ourselves for the future. In this regard, I would like to focus on three key issues that would shape our future.

Firstly, focusing on education. Our children are our hope for the future and their education is the foundation of our future. It is, therefore, important for us to continue to invest in education.

Singapore undeniably has one of the best education systems in the world. Despite our small population, we constantly produce students whoexcel in international competitions, especially in mathematics and science. However, education is not about academic achievements alone. It is about preparing our children to deal with the challenges in life. It has to deal with all aspects of their lives. We train their brains, but we must also enrich their souls.

Moral education is one aspect of education that I think needs to be strengthened. It is crucial for us to impart to our children the right moral values. We must teach them to differentiate what is right and what is wrong.We must teach them the value of family. We must teach them the importance of social harmony. Ultimately, we must teach them their responsibility to themselves,their family,the society,the nation andthe world.

Sir, let me share with you a story. Some of you might have heard this story. There was a captain commanding a destroyer. After a long day of exercise at sea, the ship was heading home. Then as the night fell, the captain saw a light in the distance. So he sent out a light signal, "We are on a likely collision path, please change course". A reply came promptly, "Change your course." The captain got a little bit annoyed and sent another signal, "I am the captain, change your course, immediately". Then came the reply, "I am sailor 2nd class, change your course". This time the captain was furious. He sent an ultimatum, "I am a destroyer, change your course, now." Then the reply came, "I am a lighthouse, change your course."

Sir, a strong foundation in basic value would serve as a lighthouse or a beacon in the sea of darkness to provide vital reference points. They are essential to avoid collisions and to provide directions. Only by building a strong foundation in moral values could we produce responsible citizens with a clear sense of direction and purpose, and not just productive people.

Sir, while moral education should remain primarily the responsibility of the parents, we must help them to strengthen it through our education system. We have reviewed almost every aspect of our school syllabus to keep up with the changing environment. It may be timely to also review the way we teach moral

Another area that I think needs to be reviewed is our character building programme. This is crucial in preparing our children for the future. Singapore is rapidly becoming globalised. For our children to survive the keen competition in the world, they must have a strong character, in addition to their skills and knowledge.

In my view, three aspects of character building are most important. Firstly, they have to be able to handle stress. Many parents have complained about stress in schools. Yes, the education system is stressful, not only to the children, but more so to the parents. But life itself is stressful, whether at work, at home or in Parliament. It is counter-productive to shield our children from stress. Instead, we must equip them so that they could cope well with stress.

Next, we must instil in them the spirit of adventure. They must not become complacent and be easily contented. They must not be risk averse and always look for the easy way out. Instead, they must constantly strive toinnovate and venture into new territories so that they could always stay ahead of the pack. Lastly, they must have great capacity for failures. To take risk means therewould be mistakes and failures. Our system today is not very tolerant of failures. To be successful, we must be able to cope with failures, learn from it and move on to greater heights.

I hope the Ministry could review the character building programme in our schools to make it more effective in helping our children cope with stress and failures and instil in them the spirit of adventure.

Another important component of our education system is our teachers. Many

As we prepare for the future, I would urge the Government to invest more resources into education for our people because they are the most valuable asset we have. We must prepare them well to meet the challenges ahead.

The next issue confronting us, as we prepare for the future, is how weplug into the world. We must quickly develop an external wing to our economy. The Ministry of Trade and Industry has worked very hard over the last few years in establishing FTAs with our major trading partners. We must now go beyond FTAs. The private sector must now take the lead and take advantage of the framework established by the Government and venture out.

However, it is not easy for our small and mediumlocal enterprisesto venture overseas. Firstly, they need to have sufficient financial resources. Secondly, they need to have good people who are willing to relocate overseas. Thirdly, they need connections. These three factors are key to a successful overseas venture.

We need to help some of these companies who aspire to go overseas. In this regard, the GLCs may be able to play a more proactive role. GLCs could take the lead in establishing beachheads in the emerging economies. As beachheads,

We must also encourage more Singaporeans to be prepared to work overseas for periods of 3-5 years. On our part, we must make it easier for these overseas Singaporeans to re-locate overseas and to return to Singapore after their posting. This is especially so in terms of their children's education, their spouses' career, their housing needs, etc.

Financing is another aspect where the local small companies would need help to go overseas. Commercial banks are generally reluctant to lend their support as their appetite for risk is relatively low, given the comfortable business here locally. I hope the Government could look into this and help our companies raise funds for worthwhile overseas ventures and eventually become regional or even global players.

The third and last issue I would like to discuss is the proposed integrated resorts. I think an integrated resort would undoubtedly give our tourism and hospitality industry a boost. However, I did mention in my speech in Parliament earlier that I was not convinced it was a good idea to include a gaming component in the proposed integrated resort.

My concerns are three-fold. Firstly, I think the arguments for and against the casino could not be based purely on economic grounds as it certainly has far-reaching implications on moral and social issues. In fact, the potential extent of moral and social impact to our society is difficult to predict. One thing is for sure,the impact would be negative, judging from the experiences of other cities with

Let me relate to you an incident I personally encountered. I was in Brisbane on a business trip some years ago when the casino there just opened. I was going out for dinner with some business associates and I hailed a cab on the street. As I got into the cab, I told the driver the destination. I sensed there was some hesitation, so I asked him why. He said he was reluctant to go the distance as the casino was opening in 15 minutes. I was not sure whether he was going there to gamble or to pick up passengers. Whatever it was, I had to call another cab. So the society there had changed.

Secondly, the economic benefits are not so clear cut. While the gaming component would attract more tourists, it was not clear whether the economics depend largely on domestic patrons or on foreigners. If indeed it depends on Singaporeans, then we are simply reallocating wealth and there is little net gain for Singapore. The changed work ethics may also imply lower overall productivity and affect our industries. I would be more convinced if there is a comprehensive study done on the overall economic impact on Singapore rather than just on the integrated resort as a stand-alone project.

Thirdly, I think we have not exhausted all alternatives. Our tourism industry is doing well as it is.

Government's efforts to restructure the economy. They heeded the Government's call for retraining and upgrading to improve their employability. Nevertheless, some lost their jobs, while others took a pay cut in order to stay in their jobs. The process was painful and many have made personal sacrifices. Now that the economy has recovered with an impressive 8.4% growth last year with unemployment rate below 4%, we have succeeded once again in remaking our economy. the initial funding for the ComCare Fund from thebudget surpluses of 2004. These top-ups totalled more than $800 million and they would go a long way to help needy Singaporeans to cope with the short term difficulties. The proposed changes to the MediShield schemeare also aimed at reducing the burden of larger hospital bills on the patients. While the premium increases are inevitable, the Medisave top-up would help in some way, at least for the short term. ComCare Fund is introduced to help the lower income group. I hope the ComCare Committee would ensure that those who genuinely need help would get it.The Government's decision to top up the CPF of older Singaporeans is a welcome move. Although the individual amount is small, it is a meaningful gesture and it is within our means. It is important to continue to recognise the special needs of these older people and help them where we could. As for the disabled, I hope the Government could do more, especially in their education and training, so that they could be integrated into the society and become a productive and useful member of the community. We have a duty to help them as they are part of the big family and it is our stated promise that no one in the family should be left behind. values. I hope the Ministry of Education would look into this aspect.changes have been made to our school system. It is also timely for us to look into our teachers. I think we should look into three aspects of our teachers. For a start, we need to review their workload. We are moving towards an education system that is more flexible and diverse. We want to encourage teachers to be innovative in their teaching methods to suit their students. All these require more time and effort.We must make sure that they have room to do so. Perhaps we could look into providing more administrative support for the teachers so that they could focus more on teaching. they could serve as a conduit to help our local businesses enter into these markets. I am glad to see some local companies teaming up with one another to go into China and India. More could be done and we could help them, if necessary.casinos. Some of the negative consequences may be mitigated to some extent through restrictions on Singaporeans entering the casino, increased law enforcement efforts, rules and regulations, etc. But it is the less obvious moral and social aspects that I am worried about. Over the medium to longer term, it could potentially erode the work ethics of our people, lower their moral values, weaken the fabric of our society, and ultimately, weaken our spirit to strive for excellence.

Of course, we hope it could do even better. But I am sure there are many successful tourism resorts in the region that do not depend on the casino model. It is unlikely that all these resorts will collapse as more casinos are opened in the region. In fact,I believe that these resorts may become premium family resorts targeted at tourists who specifically do not want to bring their family to a resort casino. They may even be able to command a premium price for the niche they occupy. Can we not be like one of them? I sincerely hope that the Government would take a more cautious approach in evaluating the integrated resort proposal and not rush into it, as it would have long-term implications, some of which may be unpredictable and irreversible.

Mr Speaker, Sir, to conclude, the Government's financial policy presented in the Budget Statement underlines the caring and inclusive approach of the new leadership. Through the Budget, we respond to the past by recognising the efforts of our people and sharing with them the fruits of our growth. We take care of the present by managing cost of living and helping local businesses survive and grow. More importantly, we prepare ourselves for the future by focusing and investing in the education of our children, by imparting to them the right values and by strengthening their character. While the future will continue to be full of challenges, it offers great opportunities for every Singaporean. We must prepare ourselves well to grasp these opportunities and to realise our dreams.

On this note, Sir, I support the motion.

Mr Speaker, Sir, I speak in support of Budget 2005.

Sir, the Budget for 2005 proposes an astute balance between the interests of Singapore business and our community.

This Budget delivers a broad-based assistance to Singaporeans and gives a clear signal that no Singaporeans should fear being left behind. As Prime Minister and Minister for Finance has reported, the economy rebounded strongly and recorded 8.4% growth last year. A large part of the growth is attributed to manufacturing which saw a stellar performance of 13.9% real growth. The services industry also held up well with a strong performance with the hotel and restaurant sector claiming a 12% real growth. This is perhaps no surprise as the improving economies in the region see a return of visitors from Indonesia and Japan. Of note is the startling increase of visitors from China and India. China and India recorded a growth of 54% and 52% respectively. Although all these figures had to do with an improved global economy last year, it also had a lot to do with the Government's strategies and resultant policies to position our key sectors during the doldrums, so that we were able to catch the wind as wedid last year. By pump priming key sectors like tourism, manufacturing, transportation, logistics and the services industry over the last three budgets, the Government had put us back on firmer footing.

Sir, clearly, the Government had been correct and, as I said earlier in my opening, astute in steering us out of the uncertainties, the volatilities and the vulnerabilities over the last few years. The Government partnered with hardworking Singaporeans and together we emerged from the gloom. We are ready to tackle the challenges that will come our way and, at the same time, share the opportunities that are before us.

Mr Speaker, Sir, we have been making the right moves. Like a gardener, we have fertilised the ground during the poor economy years, planted the seeds, tilled the ground and are beginning to see some saplings growing. We should continue to water, fertilise andnurse this growing garden of ours.

This Budget has been described as having something for everyone. It also means that the pie is shared by many and naturally a smaller piece for everyone. While we cannot expect the Budget to please everybody, let me raise a few areas where I think the Government could perhaps scrutinise and consider continuing or supplementing resources.

First, small businesses. We have been speaking about the need for our Government agencies to be pro-business. Sir, we need to put deeds to words. For starters, I applaud our Government's measure to help loss-making SMEs with the loss carry-back provision. I am also happy to acknowledge that JTC is a shining example of being pro-business. JTC has taken an enlightened approach - that if the tenants do well, so would the landlord. JTC, while rolling back the rebates, has also lowered the rentals. Where they make a difference is that JTC's pro-business approach takes care of tenants who are still in difficulty on a case-by-case basis. If I have to borrow a phrase from my profession, what JTC has shown all is the tailored approach or the customising approach toits clients, whatever assistanceitis capable of delivering to the specific needs ofits customers. I would holdJTC up to be the poster boy for pro-business.

Sir, why can the other Government bodies not do the same? For instance, we are hearing from the ground that the improved economy is really sector specific and, to a large extent, has not helped the

Short of the details on the 3Rs, some of these observations can be made. Of the 14,000 or so retailers in Singapore, only 6,000 who are HDB lessees will be eligible for the 3Rs. The balance of the 8,000 or so retail shop owners who have bought their shops from the HDB would not be eligible for this scheme. Of the 6,000 HDB retailers who rent their premises from HDB, as many as 4,000 are likely to be affected by the 3Rs, since they operate in less than ideal locations within the older precincts and neighbourhood centres. This is where JTC is an example that takes the lead in being pro-business. As I have mentioned, they have approached tenantswho were affected by the rebate roll back and still face difficulties even with a rental reduction. JTC works with the customer and they treat their tenants as customers and a working relationship develops from there. So an amicable outcome and,in most cases, the survival of a viable business is assured. Perhaps HDB can take a leaf off JTC's sterling example.

Sir, while still on the subject of pro-business, many local manufacturers have built up a good reputation for producing good quality and high-value products. Many firms jumped on to the ISO

On the other hand, EDB has been tireless in attracting foreign players to our shores. Jurong Island is a showcase and testimony to EDB's success. I wonder if EDB and IE Singapore, and even SPRING Singapore, can lock arms to assist our local businesses, specifically the local manufacturers. EDB can give IE and SPRING a heads up, turn on the radar, on the kind of businesses that they are attracting to our shores in a foreseeable timeframe so that IE and SPRING can source and aid potential ancillary services and product suppliers, the big boys that EDB targets to bring in. If this is already in practice, and I suspect so, then can the Government formalise and, if necessary, add resources towards this partnership? This will then ensure that the conduits are well oiled and, in practical terms, resolving the possible turf issues, or work out situations where no agency seems to be taken responsibility of. This, in a way, would take care of what I call "thingsthat fall between the tables" or what Mr Inderjit Singh termed as "road blocks". The work towards ultimately synergistic result among the agencies would benefit our local corporations. This will indeed be the much needed help our local manufacturers lament that is lacking - the lament that the interest in them has been eclipsed by the spotlight and resources towards attracting the big boys to Singapore. Perhaps by the end ofthe Year of the Rooster, SPRING Singapore and the other agencies can turn from a spring chicken to a fighting cock for our local businesses!

Sir, next, assistance to our people. On the Budget's broad-based assistance

Let me elaborate my concern. Sir, many workers are now finding it hard to keep up with the fast-changing times and may not have the skills required in higher value added jobs. Take, for example, a sales manager earning about $6,000 a month. If retrenched, he would find it difficult to get a job again on the same basis or even at half his salary. Schemes such as the People-for-Job Traineeship Programme (PJTP) had given an incentive to employers to take on those olderworkers in a consultant or mentorship role. Under PJTP, Government had taken on part of the wage cost up to $2,500 per month for a period of six months and longer for those workers who are above 50. Sir, this was an effective measure to help increase the re-employment prospects for older workers. However, by pulling back this programme, the employment prospects for older workers will wane. This is of concern because as our population matures and leads toa greying population, we can expect that the size of this vulnerable group to increase further. Efforts to retrain may

The continuation of the PJTP will give them half a chance

Where Budget 2004 sought to promote broad-based growth and fiscal recovery, Budget 2005 forges ahead with prudent reform to encourage continued growth and fiscal consolidation. retail sector, as evidenced bythe anaemic growth of 2.2% last year. The HDB retail shops bore the brunt of the economic slowdown and are still reeling from poor business. They have not been doing well even with the rental rebates. These rental rebates will be removed come June, and the strategy to improve the HDB retail business environment will come in the form of the 3Rs. This is supposedly a measure to correct the over supply of HDB retail space with the view that the decanting of such unproductive retail space, the HDB retail shop business environment will improve. I eagerly await the details to be announced during the Committee of Supply debate.bandwagon and consulting firms did a roaring business leading local firms to ISO certification. I am happy to note that in this regard, IE Singapore has been doing its part in showcasing our businesses overseas and has taken an active role in initiating business relationships among our local enterprises with those overseas. to Singaporeans by various top-ups to specific funds, the Government is signalling to the people that we know what their concerns are, ie, rising healthcare cost and retirement needs. However, let me raise a few areas of concern that I think need to be highlighted. Firstly, on the topic of unemployment opportunities for older workers as well as what I call the "sandwich class" of above 40s with the higher financial responsibilities than those of the 30s and those who are already in their 60s and, eloquently, what Mr Iswaran had mentioned, an example of the 49-year-old security guard who was a clerk. Sir, older workers without the necessary skill sets to find re-employment has become a permanent feature of our labour market. We have to consider measures to help older workers who find it hard to gain re-employment if they lose their jobs. not result in an immediate fix. Thus, there is a real need to extend schemes such as the PJTP further. Otherwise, the net effect may be that older Singaporeans will feel, rightly or wrongly, that their interests are not being looked after. I ask that we allay their concerns.

of being employed and for the REAP to succeed. It is like a thirsty person orlet us say, an analogy where a young man is recruited to taste test a soft drink by the soft drink manufacturers or producers and they give him cash to go to the vending machine to getthe drink and then fill up a form, andfor his trouble, he will get a rebate of free Coke for six months. So this young man takes the money, goes to the vending machine where he finds the machine is locked. So before he can get the benefit of tasting the drink, fill up the form and get the rebate, he cannot even access the drink.So,people need first to be employed before the REAP can succeed.

In conclusion, I believe that the Government has done many things to bring Singaporeans through a difficult journey in the last few years. We are beginning to see the fruits of our labour. Even thus, we cannot afford to take a back seat. I commend the Government for taking the right track in bringing Singaporeans and our businesses through these difficult times of economic change. However, I ask the Government to consider not pulling back the assistance as yet. Some are just finding their footing. We have prepared the foundation,but let us not build on it before the foundation is fully set.

With this, I support theBudget.

Order. I propose to take the break now. I suspend the Sitting and will take the Chair again at 3.55 pm.

Sitting accordingly suspended

at 3.32 pmuntil 3.55 pm.

Sitting resumed at 3.55 pm

Debate resumed.

Mr Speaker, Sir, I rise to support the Budget.

To me, this is a prudent, cautious and targeted budget, setting out measures to create a caring society and a dynamic economy. Many have commented that the measures to distribute some of the Government's surplus to the man-in-the-street are "people friendly" and "generous". It is indeed a Budget for the heartlanders. I, therefore, would like, on behalf of my constituents, to thank the Prime Minister and Finance Minister for the generous handouts.

Sir, having been in deficit for the last three years, it is timely to have a balanced budget. The temptation to spend and distribute by digging into our reserves is always high. However, Singaporeans need to recognise that having balanced budgets and surpluses are critical to the long-term economic health of the country and the continual success of our future generations.

Should we eat into our reserves and run them down, we will lose our ability to be economically competitive and the fragile success and wealth that we have built up could be eroded rapidly. Take, for example, the case of the Philippines. As the South East Asian economic powerhouse of the 50s and 60s, just one to two generations ago, late last year, that country's credit rating was downgraded to below investment grade as a result of poor fiscal discipline over

In simple economics, Sir, a government running fiscal deficits has limited and risky options to raise money.For example, raising taxes could make the economy not competitive globally, which is an issue facing Hong Kong today. Cutting expenditure drastically reduces the extent and quality of public services which is evident in India and Indonesia today. Raising domestic borrowing may force up interest rates and crowd out private enterprise as in the case of Malaysia. Dependence on external borrowings, like the Philippines, risks an economic crisis.

the years. Indeed, President Arroyo had warned recently that the Philippines was potentially one year away from an Argentina style of crisis, which resulted, as we all know, in debt default, currency devaluation, further indebtedness, loss of credibility, confidence and sustained periods of poor economic performance.

Just printing money has its corresponding risks of inflation and currency devaluation as seen in the Asian financial crisis.

Sir, all across Asia, we have seen budget deficits resulting in higher interest rates, reduction in economic attractiveness for investors, and sub-par economic performance. Even the mighty US dollar has come under tremendous pressure, falling by some20% against most major currencies in the last two years, partly because of fiscal ill-discipline. This erodes the nation's wealth as a weaker dollar reduces the purchasing power of its people and, over time, lower their quality of life.

Hence, having a balanced budget is critical, as fiscal deficits are clearly not the route we want to go. I note that the FY05 Budget, although in surplus overall, without income generated from past reserves, the Budget would have registered a deficit of some $830 million.

The Ministry of Finance has explained in the Budget documentthat the use of NII serves as a fiscal buffer to allow the Government to enhance Singapore's competitiveness by lowering taxes. Whilst I agree, I hope this will be an exception rather than the norm.

I note that total expenditure, which has exceeded operating revenue for the last three fiscal years, would likely continue for the medium term, as projected by the Ministry of Finance. Sir, to me, thisis unhealthy, as it is making us dependent on the nation's healthy reserves built up over the past years.

An unexpectedeconomic slowdown can easily turn our projected surplus into deficit from lower revenue contributions from taxes, or an adverse investment climate could reduce NII. Each time we dig into our reserves in deficit, rather than add to them with surplus, the potential NII contribution will fall and our position of fiscal strength could be eroded over time.

Sir, it is thereforeimperative that we give greater consideration towards ensuring operating a balanced budget rather than depending on NII to fund the deficit. We should, in times of plenty and healthy economic growth, seek to add to our reserves by generating more surpluses in good times. This will ensure that, in rainy periods, when we have to dig into our reserves, there will be ample amount to buffer such wet weather periods. Given the uncertainty in the global economic and political environment, it is possible that shocks like September 11, economic crises, occurrences like SARS or other adverse events may happen more frequently.I would urge the Government to consider running an operating balanced budget going forward, and not be too

Clearly, therefore, there is a need to consider ways to further contain and control operating expenditure as well as ensuring revenue growth. At this point, Sir, I would like to add that the Parliamentary Estimates Committee, of which I am Chairman, has looked into this in the last few years, and I refer Members to the Committee's reports and findings. Allow me, Sir, to highlight some of the findings.

The Committee has validated and steered numerous measures to reduce wastage of resources and funds. For example, by institutionalising Economy Drive initiatives alone, there were savings of some $687 millionin the Ministry of Education, Ministry of Defence andthe Ministry of the Environment and Water Resources, and these savings werefreed up on FY03. Best Sourcing and Public-Private Partnership (PPP) initiatives, which have commenced in late 2003, have resulted in increasing market test of non-core functions and greater outsourcing, resulting in millions of dollars of savings to the Government. Managing for Excellence programmes to achieve quality systems and processes have also yielded productivity gains. A culture of continuous learning and improvement in Government agencies is being encouraged for more efficient delivery of services.

Sir, I am therefore very pleased that the Government, in this Budget before the House, is committed to further seeking efficiency gains, minimising waste, and finding more cost-effective ways to deliver Government services, and that the best sourcing concept and PPP initiatives will be followed through. I urge the Government to consider hastening the

However, whilst all these initiatives and programmes are good and would go further towards capping expenditure in the long term, more importantly, and perhaps harder to implement, would be to institute cut waste concepts and best sourcing as a matter of public sector culture, by changing mindsets and the behaviour of civil servants. Without buy-in and mindset change, the penetration of such efficiency drives will be limited and not sustainable, as waste and inefficiency can crop up elsewhere within the public service.

Sir, at a macro level, I have concerns that our attempts to cap expenditure at the micro level through these initiatives alone would be ineffective, if the block vote budgeting scheme used for allocating budgets to Ministries is not reviewed regularly.It is observed that the present block vote budgeting system,which caps Ministries' budgets as a percentage of GDP, and enables the Ministry of Finance to keep Government spending to not more than 19% of GDP, may not be a sufficient tool in managing down public administration cost. For example, after a 3% budget cut across the board for all Ministries, the absolute dollar Ministries will get in FY05 still goes up because block budgets are set as a percentage of nominal GDP, which has increased.

I would therefore like to ask the Minister for Finance if the 19% of GDP benchmark for block budgets is indeed an efficient one, and if there is an objective measure of fiscal efficiency that is lower,

Let me illustrate. Assuming the fixed costs of provision of public services are fairly constant, even allowing for inflationary adjustments, the variable costs to support incremental nominal GDP growth ought to be less than 19%, which is the overall figure. If so, then this methodology may mask the potential for more efficiency gains to be generated in the provision of public services in the longer term, as the Ministries' budgets expand automatically with nominal GDP growth, and the potential for waste is increased.

I would, therefore, propose that the 19% of GDP benchmark be reviewed regularly to ensure public expenditure does not balloon because of increase in nominal GDP. In other words, as our GDP pie expands, the benchmark should perhaps be lowered to 18%, 17%,16% or some other percentage much lower than 19% over time.

Sir, capping expenditures to achieve a balanced Budget is only one side of the equation. To balance the operating budget, there have to be measures to raise Government revenue. Clearly, the best wayto raise revenue is to continue to stimulate economic activities and encourage enterprise and work.

Besides taxing on income generation, we should seek ways to raise revenue through the use of indirect taxation, and in ensuring that non-core public services ought to be self funding. For example, the re-balancing of the taxation regime from ownership of vehicles towardsconsumption canbe further developed so that taxes are in keeping with economic

In addition, the policies of Public-Private Partnership and Best Sourcing should lead to more efficient allocation of resources and have revenue raising benefits. Outsourcing public sector services, where the private sector can do better or more competitively, will also serve as economic drivers and support private enterprise. There are also many business ideas and projects that can add incremental economic value to Singapore and, hence, the constant calls for the Government to invest, co-invest or fund such enterprise. I urge the Government to continue to help facilitate the growth of high-tech industries, financial services, technology and life sciences, and invest in infrastructure and technology that will make it easier to set up and do business in Singapore. By facilitating enterprise, economic activity is engendered and, with growth, we can raise revenue in a more sustainable fashion.

In conclusion, Mr Speaker, Sir, I commend the Prime Minister and Finance Minister for a prudent Budget for FY05, but I dohope that Singaporeans will continue to recognise that our budget surplus and reserves in the past were hard to come by and are not to be trifled with. Persistent deficits will send us on the road to long term economic malaise, and impose an unnecessary burden on the future generations of Singaporeans.

We should really, in this time of economic recovery, look to building up budgetary surpluses, spend on measures that would raise revenue by stimulating sustainable economic growth, and rethink our macro block budget allocation system, whilst consistently seeking to cap Government expenditures. I urge the Minister for Finance to work towards

Sir, I reiterate my support for the Budget.

In other words, we are running an operating budget deficit and depending on projectedNet Investment Income (NII)from our reserves to balance it. dependent on NII contributions to fund the deficit, and seeking to add to our surpluses in this economic recovery period. rolling out of some of these programmes, ie, to deepen the penetration of market testing of non-core functions from the current 5% to 10%, and ensure that the delivery of specific programmes and services in the public sector can be as self funding aspossible. I believe these incremental measures in total can lead to substantial reductions in Government expenditures over time. which could be a standard for the public sector to aspire to. Sir, my concern is that, as GDP expands, it is not clear if it automatically follows that, as a percentage, the public expenditure required to support that growth needs to expand at the same rate.activities. Likewise, the GST can be raised to shift the balance of taxation more and more awayfrom income to consumption, if need be, to fill operating budget gaps. balancing future operating budgets and to rely less and less on NII to fill operating gaps.

Mr Speaker, Sir, thank you for allowing me to participate in this debate.

Sir, since the announcement of the Budget, there are mixed reactions from the Small and Medium Enterprises (SME) community. As is always the case, there are some who are pleased with the measures announced in the Budget and some who are not particularly impressed. So, the saying that "You cannot please everyone" is proven right once again. Nevertheless, the general feeling is that this year's Budget, though comprehensive and covered a wide range of issues from babies to the aged, is more of a refinement budget.

Some SMEs felt that the measures for businesses, which apart from the loss carry-back measure, were rather focused with certain segments of the economy, such as the logistics industry and the real estate investment trust market. Local businesses that hailed from the more conventional industries were hoping for more aggressive measures in the Budget that could help generate more business to them. The sentiments of these local businesses are understandable, given their business condition in recent years.

Through the maturing of our

economy, the structural changes that underpinned our economic advancement over the years have somewhat dichotomised our economy to the extent that growth has primarily been generated by the advanced and high-tech sector of the economy, such as the biomedical, pharmaceutical and petrochemical industries whilst the

The irony is that while the Government made announcements on the healthy economic growth that has been registered in the last four quarters, businesses in these conventional industries were unable to feel or sense the improvements in business conditions. There is no doubt that the Government had done a lot in providing these businesses with measures to lessen their burden, but these measures, though helpful and welcomed, are generally focused on reducing business costs and are not meant to directly address the root cause of their problem, which lies with the level of business available to them.

Indeed, the smallness of our domestic market had exacerbated the effects of the structural changes in our economy and together, they have placed greater pressure on local businesses in the more conventional industries. These businesses are finding it hard to survive because too many players are fighting over the same piece of cake and to make matters worse, it is not a very big piece of cake, to begin with.

The Budget had acknowledged the importance of small businesses as being the backbone of many economies and there are measures in the Budget to help our SMEs. Amongst others, the loss carry-back feature and the waiver of fee for subscription to the Government e-procurement portable GeBiz for one account are helpful to small businesses. But reflecting on the sentiments of many SMEs, these measures do not adequately address the more fundamental problem faced by them - the lack of business. The general feeling amongst SMEs is that there is not enough business for everyone. Hence, improving the top line for SMEs has emerged as a more pressing

Previously, the Economic Review Committee (ERC) had made recommendations for GLCs to exit from non-core businesses so that they can focus on building up their core competencies and external wings while allowing SMEs more room to manoeuvre in these business segments. This would help to correct the rather contentious matter on the crowding out effects exerted by state enterprises on SMEs. In a move that aligned with the ERC's recommendations, it was announced in Budget 2003 that the Government would progressively stop providing services that the private sector could supply and that a review would be conducted on all Government-related companies every three years.

The Government's move in this regard is to be lauded. PM Lee in his Budget speech this year had given an update on what the Government had achieved through the Best Sourcing initiative. We learned that under this initiative, the Government had outsourced S$57 million worth of contracts to the private sector and in turn benefited with S$9 million worth of annual savings. A win-win situation indeed!

Notwithstanding the Government's efforts in outsourcing its non-core functions through the various initiatives, there would always be a segment of local businesses that would continue to find it increasingly difficult to rely on the domestic market alone. For these businesses, it gets increasingly more difficult to meet their growth objectives by just focusing their business on the domestic market. Venturing into overseas market thus elevates from being a part of

Unfortunately, albeit their willingness to venture abroad, many local businesses are not adequately equipped with the competencies to venture abroad successfully on their own. Many would need help in this area. I acknowledge that the Government has reckoned the importance of helping local businesses venture overseas and taking them international. The focus of IE Singapore had been aligned towards helping local companies grow and internationalise. IE Singapore offers a wide range of services to help local companies embark on their overseas ventures and it includes providing market intelligence, advice and ground facilitation services. However, despite the services rendered, many SMEs still face difficulties in their bid to go international.

Once again, the ERC had previously made certain recommendations to help SMEs venture overseas, one of which was a proposed "piggy-back" arrangement to allow SMEs to ride on GLCs in penetrating overseas markets. This proposal was premised on the fact that owing to their small size, SMEs have lesser resources and offer less perceived credibility as compared to GLCs, and these factors make it more difficult for them to succeed in their ventures abroad. If GLCs could lend SMEs a helping hand by making them part of the package in their venture, it would help open the doors to these overseas markets for SMEs. I think it was a good proposal, but I am not sure how much success has been achieved in this regard. The relevant Ministry can perhaps provide an update on the success of this "piggy-back" arrangement. The relevant agency should also study successful models of overseas

Due to our historical links as an entrepot and the reliance on export-oriented growth strategies, SMEs had in the past not played a predominant role in the economic growth of Singapore. But with the emergence of huge and regional economies like China, India and Vietnam and faced with a less certain environment, search for new economic strategies that can achieve resilient growth has brought about a fresh focus on the role of SMEs. With SMEs accounting for almost half of total employment and contributing about 30% of our total value add, the significance and contributions of SMEs to our economy should not be undermined, particularly since these enterprises make up the indigenous part of our economy. They are rooted in and committed to Singapore and are here to stay. Contrary to their once relatively anonymous presence and role, growing SMEs and promoting entrepreneurship have now emerged as an integral part of future growth strategies.

The main functions of SPRING Singapore as listed in the Annex to the expenditure estimate for the financial year 2005/2006 include nurturing a pro-business environment that encourages enterprise formation and growth, facilitating the growth of industries, enhancing productivity, innovation and capabilities of enterprises, and increasing access to markets and business opportunities. With these as its main functions, SPRING should be the champion for the cause of SMEs in Singapore and it must emulate what the EDB does for foreign companies investing in Singapore in its dealings with SMEs. Sir, EDB has earned a very good reputation in the way it manages and assists foreign companies investing here

To facilitate the role and functions of SPRING, I would like to urge the Government to allocate it with more resources so that it can be in a position to render more support and assistance to local businesses. And for that matter, I would also urge the Government to allocate more resources to IE Singapore who has an instrumental role to play in helping SMEs venture overseas.

PM Lee, in this year's Budget speech, had underlined the Government's commitment towards creating a more resilient and dynamic economy and helping private enterprise flourish. PM Lee also advocated the adoption of a risk management approach to regulation to promote enterprise, by takingthe perspective of managing risk instead of eliminating risk.

Previously, when Acting Second Minister for Finance and Senior Minister of State for Foreign Affairs, Mr Raymond Lim was the Minister for Entrepreneurship, he mentioned that the Government should, when dealing with businesses, set its default key at "yes" rather than "no". And to quote Acting Minister for Community Development, Youth and Sports and Senior Minister of State for Trade and Industry and also the current Minister for Entrepreneurship, Dr Vivian Balakrishnan, atan ACE forum last December, he said, "We are in politics ... We have the opportunity to change rules and make what was previously illegal, legal, and that is what keeps us awake at night and that is what wakes us up in the morning." These messages invariably represent an emphasis on mindset shifts in the civil service towards more risk taking in order to promote enterprise.

It is indeed reassuring to learn of the emphasis placed by our leaders and top

Be that as it may, there is no clearer message than the one from the Prime Minister for civil servants to adopt a risk management approach rather than to fear taking risk and, with that, I trust that many more civil servants would follow suit in adopting an approach that is more pro-business and less risk-avoidance in their dealings with businesses.

Finally, Sir, I would like to say that this year's Budget is wide ranging, inclusive and pro-enterprise. Perhaps the one contention I have is that on the hike in foreign workers' levy which may have come a little too soon, since many in the conventional business sector that are relatively dependent on foreign workers in their operations are still not clearly out of the woods yet. Nevertheless, to those who have complained that the Budget has not adequately addressed their concerns, I would like to urge them to look at the Budget not in isolation or in a snapshot manner, but rather to look at it as part of a total plan comprising a series of budgets. Viewed in this light, one would be able to better appreciate the intents and objectives of the measures meted out. Further, the tangible aspects aside, the intangible aspects of the Budget should not be ignored. In this year's Budget, we can find one such aspect, among others, in PM Lee's message, calling for the civil service to adopt a risk management approach in place of a risk-

With that, Sir, I support the motion.

more conventional sector of the economy, such as the property, construction, retail and electronics industries, continue to experience difficulties.problem. The situation has not been helped by the fact that some Government-linked Corporations (GLCs) continue to be involved in certain aspects of businesses that appear rather incongruous to the SMEs. a good business plan to an essential part of a business strategy for these local businesses aspiring to achieve their growth ambition. For these businesses, the only way out is to look for new opportunities in overseas markets.ventures by others and initiate schemes that emulate these successful models to help our local businesses go abroad.and I am confident that SPRING would likewise emerge and act out as the "the EDB for SMEs." officials on a mindset shift in the civil service, but the old and familiar concern of whether the same emphasis has trickled down to those down the line remains. Such emphasis and initiative on mindset shifts for the civil service would come to nothing unless those down the line for whom businesses deal with, are similarly aligned in their thoughts. Sadly, if the feedback I gathered from my dealings with SMEsis anything to go by, I am afraid that this trickling down has not quite yet achieved its desired effect.elimination one, so as to encourage and promote enterprise and entrepreneurship. This can only bode well for local businesses and help to foster a conducive business environment.

Mr Speaker, Sir,there is an inverse relationship between the need for social assistance and the business cycle. When the business cycle is up, jobs are plentiful. Employers need every worker they can get. Even the low-skilled workers will find odd jobs that pay well enough. Fewer families need social assistance,

and for those who need it, it is easier to find the funds for them because more companies are profitable and could make more corporate donations to charity.

In a downturn, the reverse happens. More workers, especially those with lower skills, are out of a job. Companies are less generous with their donations. It is also the time when the Government's budget may have to be tightened. In a severe recession, social assistance may have to be cut, along with other expenditures, just when social assistance is needed most.

The ComCare Fund is a sensitive and responsive way to get us out of this contradiction. It is an endowment fund that would riseeventually to $1 billion. Social assistance programmes would increasingly be funded by the earnings from the ComCare Fund. When the Fund is big enough, social assistancewould not need to compete with other Government programmes for a share of the annual budget. This way of funding would give a stronger assurance that the needy among us would always get help, especially at the time when they need it most.

While the ComCare Fund would be a steady source of funds to draw from, that should not lead us into thinking that the

There is a common saying that it is better to teach a man to fish than to give him fish every day. But, Sir, what if the man does learn howto fish but does not know how to get to the river? His family would still be hungry.

In our work at the South East CDC, the officers discovered that this could happen among job-seekers. We have seen it reported very often,a factory in Jurong or Loyang advertises that they have some vacancies.The CDC or WDA officers contact job-seekers on their database to tell them about the openings. The job-seekers say that they are very interested andpromise to go for the interview. On the actual day, very few actually turn up.

At job fairs, some companies go to the extent of offering employment on the spot. Even so, many who are offered jobs do not even turn up for work at all. Employers, job placement officers and the media express disappointment, and lament that these workers are not motivated enough. But the CDC officers have discovered that there may be a simpler reason behind this phenomenon, and that isthe fear factor.

Some workers just do not know how to get to the place of work if they have never been there before, and they could notget anyone to show them the way. They do not know where to change

The thought of not being able to find the interview location, the thought of being late and, therefore, get disqualified, of incurring high cost to take a taxi home if one is lost, is so daunting to some that they do not even make a try.

The South East CDC started a pilot project to solve this problem. When there are jobs on offer, we gather the applicants who are interested at the CDC, that they know where to go to. An officer brings them to the workplace by the public transport route. The officer would point out the landmarks along the way, get down with them at the right bus stop and walk with them to the workplace. He or she would show the group the way back after interviews are done.

Are we pampering our job-seekers too much? My officers and I believe not. We believe that this hand-holding is a necessary part of building self-reliance and self-confidence for those who need it. Not every job-seeker could read a road directory and navigate in unfamiliar territory among the industrial estates or our city centre. They have a genuine fear of getting lost, and of having to spend a lot of money to get home again. In their financial state, they are in no position to risk it.

Our little experiment is showing good result. For a start, 100% of the job-seekers who turn up at the CDC turn up at the interview location and get interviewed. That is a far better record than the 5-10% we always get if we do not do it this way.A number have been offered jobs. What is most encouraging is that job-seekers have told our officers that because the officers have made the effort to accompany them all the way, they will

Let me give another short observation. Some mothers from needy families say they want to work but could not do so because they have young children to look after. When told that the children could be put in a childcare centre at a highly subsidised rate, some of them are still veryreluctant to put the children in the childcare centre. Perhaps this isbecause that is only one step among many more steps they have to take before they could be gainfully employed. They do not know whether they could take all the steps eventually. They have no mental picture of what the future holds, what it could belike for them, and have no confidence of achieving that futureeven when it is mapped out for them.

Some of the obstacles are real, some are imaginary. But to help needy families become more self-reliant, we must understand their fears and constraints, and give them the knowledge and resources to overcome them. For those who need it, we should help see them through every step of the way until they reach self-reliance. The South East CDC would make full use of the ComCare programmes to achieve this.

By self-reliance, we mean: (1) the ability to keep the family unit intact; (2) the ability of the working adults to hold a steady job; (3) the ability to avoid arrears on their household bills; and (4) the ability to encourage their children to do well in school.

Each of these components requires a different skills set and mindset in the family members as well as in the counsellors helping them. Families that require social assistance vary a lot across a spectrum of circumstances. Some are quite motivated. Given sufficient help, they could cross the line towards self-reliance easily. Others face a multitude of

South East CDC would work with the voluntary welfare organisations and grassroots bodies to develop and implement the building blocks that could help families from different parts of the needs spectrum become self-reliant. In designing new initiatives, our emphasis would be "maximum flexibility, minimum complexity�?. Our effort wouldlikely involve a lot more hand-holding and customising to individual family needs. More volunteers would be needed and enlisted.

We look forward to meeting the challenge.

Sir, I support the Budget.

way to use it is to give more cash to more lower income families. We should do some of that, but the ComCare Fund should not be used entirely in that way. That wouldonly encourage greater reliance on welfare. We should use the ComCare Fund carefully to promote greater self-reliance instead. To achieve this, we need to equip needy families with the basic survival skills that most of us take for granted. buses, which bus stop to get down at, and even if they get down at the right bus stop, where to head towards, if the workplace is a few streets away from the main bus route. All this, I tell you, is true. try harder to stay in the jobs that they have been offered.financial and relationship problems. They require much more individual attention.

Sir, I applaud the Finance Minister's vision of a land of opportunity for all, where no one is left behind. It is a caring and inclusive Budget.

Sir, in my speech I would like to focus on three particular groups that merit closer attention. First, the lower middle to lowerincomesandwich generation, struggling to support their elderly parents and their young children;second, the elderly; andthird, the housewives.Although our inflation rate has been manageable for most, it is these three groups that would feel most keenly inany rise in the cost of living.

Sir, the sandwich generationgroup has been rapidly on the rise. Overall, we have a total of about 197,000 households or 21% in 2000, with at least one person aged 65 years and over. It is up from the 136,000 or 20% a decade ago. When one talks to these families, onegets a sense that they are worried about the rising health cost for the elderly and education cost for the young children.

We need to put in place policies to assist families to take care of older adults in an integrated manner. Sir, last week I had several dialogues with the VWOs which care for the elderly -because Tampines/Changkat is an ageing estate -and I have two daycare centres which offer rehabilitation. They tell me that most of their patients come from the lower income group or the lower middle income group - 4-room flats and below - and many of them could not pay the full fee required, which is about $500 a month. It is important for the elderly to go for rehabilitation. All the while we have been telling Singaporeans that it isimportant for them towork to support themselves. But if they are not well, and if theyneed rehabilitation, then they could not do so. So rehabilitation is important for them so that they could recover their health and, hopefully, return to the workforce. Even though the quality of life is important, it is also important that they go for rehabilitation regularly.Butdespite the subsidies that are offered, the families stillsaid they could not afford the fees required to pay for rehabilitation for their elderly.The elderly often tell us that they do not want to be a burden to their children. Many of the elderly patients in rehabilitation centres are above 70 years oldand their adult children are aged 50, who arealready concerned about their own retirement.

This isthe trend I see in mymeet-the-people sessions. For example, just a few months ago,a resident came to see me, and this is a typical case -sole breadwinner, forklift driver, supports

Sir, I would suggest that the Government give eldercare subsidies to lower income and lower middle income families the way we give childcare subsidies to these families. We do not put them through a means test when we offer, let us say, the centre-based financial assistance scheme for childcare. We should regard this as a necessity and not a luxury because it isimportant for the elderly's recovery and integration into society.Perhaps we could expand the use of Eldercare Fund which the Government is puttinginmore moneythis year. It is not clear to us the value of the Eldercare Fund, how is the trickle-down effect on the VWOs and those who need help. I would ask the Government to please give an update on the use of Eldercare Fund.

Turning to the elderly, we have talked a lot about the land of opportunity, but what could the elderly look forward to, especially the frail elderly. Sometimes, when you talk to old people on the ground, the only thing that the Government seems to offer themare jobs like cleaners or hawker assistants, not exactly the kind of retirement job that onewants to ride into the sunset with.I think we should be able to offer a future where they could look forward toa life of security, opportunity and dignity.

So I would ask the Government to please look at the assumptions of our policies, which is that the needs of theelderly either remain static or decrease over time. But their needs are actually growing as they live longer and aspire to lead fulfilling lives. The Government should devote more resources to develop community-based and affordable support systems to help families cope. I am glad that the Government is workingon lowering healthcare cost by reviewing MediShield and topping up Medisave. Butthere is a shift now, more and more, for the elderly to move from residential care in hospitals towards home-based care. But for this to be successful, we need to develop and support integrated community-based services that provide substitutes and alternatives such as daycare rehabilitation centres which allow the elderly to get healthier and, at the same time, return home at the end of the day and, hopefully, one day find a job that they could be proud of.

Sir, presently I want to focus on rehabilitation because it is a very important part of the elderly's life, when one ages,getsa stroke,various problems andrequire care. Presently, patients are not allowed to use their Medisave to pay part of the cost of going to daycare rehabilitation centres based in the community. But that is an anomaly because they could useMedisave if they go to a MOH registered rehabilitation centre attached to hospitals. Ifan elderly suffering from a strokeneeds rehabilitation, it makes no differencewhether it is a MOH registeredor MCYS registered rehabilitation centre. But with MOH registered,onecould use Medisave, for the other, one could not. Sir, I would ask the Government to change the mindset towards these community-based day services for the elderly. It is not a sign that

There is a sense of being squeezed. Even though we try and help them, there is a sense that they are being pulled in both directions. Sir, they are under pressure and, as a result of this, we have a problem where they feel emotionally unable to cope and financially stretched.sister, mother, wife and3 children. He takes home about $800 a month. He has to pay for his mother's medical bills because of diabetes, and his wife, who once worked as a production operator, had to resign to care for the kids. This is a problem that I feel we have to grapple with, and the means test that we presently have in place to give subsidies is the one that causes families to tear apart.I have heard it many times from several families that to expect them to beg or to ask for the children's payslips so that they could apply for a means test and to be eligible for subsidies is something that is hard for them to do.

children are eroding their sense of filial piety if they send their elderly to rehabilitation centres or day care centres

Sir, this is where I feel that the policy is a little bit slow to catch up with what is going on on the ground. On the ground, the integration is already happening and we see more and more centres offering this. I suggest that all-day rehabilitation centres in Singapore now under the current ambit of MOH and all community-based rehabilitation day-care centres for the elderly under the purview of MCYS be integrated under one Ministry for better synergy and maximisation of resources. This would also facilitate making subsidies transferable and portable among the day rehabilitation centres and elder care centres.

Sir,we also need to help VWOs specialise in elder care, and this is part of our building community vision. The Government has been encouraging the public sector to step forward to plug gaps, and we know that VWOs often run on a very lean outfit, with very tight budgets. The recent announcement of the hike in foreign worker levy has caused some to be quite concerned, because VWOs, especially those that specialise in elder care, do rely on foreign workers because they need to keep their pay low, especially for the multi-tasked care staff. The multi-tasked care staff do things like feed the elderly, bring them to the toilet, clean the centre.VWOs pay about $800

The Government can also help reduce operating costs of the VWOs by giving exemption on road tax for the vans which are equipped with hydraulic wheelchair lifts, which are operated by the VWOs, to transport the elderly to and from the centre and the home. This is a necessity. Increasingly, we see more and more Singaporeans in wheelchairs as they are unable to move around on their own. And these wheelchair-bound elderly cannot use public transport and they cannot afford taxis. They have no choice. If they want to go for rehabilitation, they need these vans.

Presently, the vans with a wheelchair lift have to pay road tax andERP. I urge the Government to consider allowing the VWOs to be exempted from this to reduce their operating costs. Presently, ifa VWO has one van and there are 50 elderly people, one van can take four elderly personsat one time one hour to fetch four people tothe centre. If there are 50 elderly people, it would take more than 10 hours to take all the elderly peopletothe centre and it will be closing time. So VWOs now have an increasing need to have more vans with this facility. So please help them to serve our elderly better. Already, these VWOs have to pay higher car park charges for their vans because of the tonnage. Because they have wheelchair lifts, they have to pay more than the

Sir, I would also urge the Government to expend greater resources in helping the wheelchair-bound to integrate into society. Already, in many parts of the world, we see an ageing population. Ifwe want to make an economic case for it, it is a good investment. We probably will see more ageing tourists coming to our shores by the bus loads and if we have elderly friendly ramps and buildings at Orchard Road thatare hype and happening but also happening for the elderly, I think it will be good for us, for our elderly as well as for our economic growth.

Sir, I hope that even as we make Orchard Road more exciting, we incorporate features that can make it easy for the wheelchair-bound to zip around. Ifwe go to New York, it is the land where everybody is busy rushing around butwe see people in wheelchairs wheezing around. It is part of the landscape. In Singapore,we do not see it in Orchard Road, and it is not because we do not have wheelchair-bound people. If we go to East Coast Parkway,we can see many coming out enjoying the view because they can use the facilities. But if they want to go shopping or if they want to enjoy the sights in Orchard Road, it is very difficult. Sir, I would urge that we prepare for the ageing population and we prepare for the fact that this region will see more ageing tourists in the future.

The third group is housewives. Most of our caregivers are women and often housewives, but sometimes I wonder who cares for the elderly housewife. Who pays for the financial security and medical savings of these elderly housewives? These are issues that need to be addressed. I see a trend of more

Government policies should remain neutral on the issue of career choice for women, whether it is to be full-time housewife or in the workforce. Public policy should treat the women at home and in the workplace equally. But, presently, our policies are skewed towards freeing up women to be better workers, and not enough emphasis on policies that free upwomen to become better mothers. The conventional approach that we have today is implicity oriented towards helping mothers work while raising children or achieving what we call a work-life balance. But there are women who want to invest all their resources in taking care of their children and bringing them up for the first five to 10 years of their lives, and there are good reasons why they do that. The early years of childhood are critical for social and cognitive development and some mothers want to invest more heavily in shaping this development than in advancing their own careers.Sir, home care during the early childhood years is labour intensive and we should recognise the economic value of the homemaker's contribution during that period.

Today, the Government spends millions on subsidies for working parents

Sir, to conclude, I know that there might be quite a number of calls for more help to the lower income and to those who might suffer from the fast pace of change and restructuring. I agree with the Finance Minister that we should not breed a culture of entitlement. In fact, we have been very cautious about handouts because we are worried about the crutch mentality that might creep in. And, indeed, in our MPS, sometimes we have cause to worry when residents turn up expecting financial help outright when they run up high household bills or credit loans which could have been avoided if they were more prudent and disciplined.

There is already evidence of some sense of entitlement with the utility save scheme, and I wonder whether we should target it more at the lower income rather than spread it quite thinly also to the higher income and middle income groups. We need to be even more targeted and we need to be cautious and target our help at the elderly and the families who find it increasingly hard to cope because of circumstances largely beyond their control. Then it will indeed be a land of opportunity for all including those who now feel down and out and who want to look forward to a future of dignity and land of opportunity.

On that note, I support the Budget.

for the elderly. On the contrary, it is a sign that children care enough for their parents to make sure they get integrated care. And at the Government level, we should also integrate health and social care services and treat them as equals in terms of subsidies for elder care. This is because health and social conditions are often tightly intertwined and medical intervention cannot be successful without also addressing social issues. We need to encourage elder care that provides nursing andphysiotherapy, to improve the elderly physical condition as well as the social activities that help them to bementally stimulated and emotionally connected. a month, and this is not the sort of pay that would draw Singaporeans. So to try and draw Singaporeans, the VWOs have managed to try to increase it to $1,000 but even then, it is very hard to attract Singaporeans, and I doubt whether these jobs can be redesigned and I doubt whether the VWOs can afford to pay more to attract Singaporeans.Sir, I would urge the Government to consider either waiving the levy or reducing the levy for VWOs. ordinary van. For the ordinary van, it is only $65 a month for a HDBcar park lot, whereas for the van with a wheelchair lift, it is $185 per month. Even the cost the VWOs have to bear is higher. grandmothers coming to my meet-the-people sessions. And those who come for help often cite their adult children's inability to pay for them and on the problems coping with household bills, as their children wereabroad. This is not a problem for the present generation of older housewives only. We alreadysee in our Forum pages the debate about some younger women, well-qualified ones, choosing to give up their careers to be full-time housewives. And some become homemakers at great financial sacrifice, struggling to live on a limited single income. This dedication to the role of motherhood should be encouraged and not discouraged by our tax regime. who place their children in day care centres. The provision of similar supports to full-time homemaker with children under five years of age and homecare allowances would afford parents greater freedom to choose between caring for children at home or consuming state subsidised day care benefits.Sir, a homemaker's tax credit perhaps through the CPF will help them save for old age as well.

Mr Speaker, Sir,the 2005 Budget is a

I would like to tug at the heartstrings of the Finance Minister to consider reallocating some goodies into the empty pockets of the sandwich class so as to achieve the inclusive society that he has been advocating. Here,I refer to the set up of a Bridging Seed Loan and Mindset Training Fund.

At the same time, I also like to suggest the adoption of eight Enablers to further enhance the economic welfare of the mature unemployed workforce, facilitate a culture of opportunity, strengthen learning and sharing, and to appreciate diversity so as to further energise our economic performance.

The Enablers are:

Provision for higherCPF contribution for those above 55;

Tax Incentives and elderly employment quota to facilitate rehiring of retirees and jobre-creation;

Campaign and champions to promote re-hiring of older employees;

Learning Circles and Learning Trips on elderly employment programmes;

Raising the retirement age;

Human Factor – A Plus for Efficiency;

Expanding the concept of Public-Private-Partnership (PPP)to create a community of learning, sharing and ownership; and

Sir, my recommendations will fall under the three categories of:

A caring and inclusive society;

A lean and effective Government; and

A dynamic and entrepreneurial economy.

A caring and inclusive society

On a caring and inclusive society, the Finance Minister hasreached out to almost all segments of Singaporeans with his practical and prudent programmes in the 2005 Budget.However, what is starkly missing are provisions for people who have lost their jobs and are not getting their employment back. Sir, here, I am referring tothe group of PMEs who are asset rich but cash poor.

The truth of the matter is that the social status of living in private property is very misleading.Many are in a catch 22 situation. To downgrade in a depressed property market may lead to a negative for some whilst for others who are prepared to part with their properties, they cannot even find ready buyers.

Culture of opportunity

Just to assure my parliamentary colleague, Mayor Matthias Yao, I am not advocating for subsidies or freebies, as we do not want, as the Finance Minister had said, to breed a "culture of entitlement�?.But, as the Finance Minister had correctly said, "We must foster a culture of opportunity. Encourage Singaporeans to see Government support as a chance for them to concentrate on acquiring new skills and jobs, and get back on their feet again.�?

Alas, for many in this sandwich class, new skills acquired have not landed them on new vocations as they are deemed to be "over-qualified�? by employers because of their sins of being in high executive jobs in the past. Many in this group who had lost their jobs, have lost them for good!

Sir, the ComCare Fund should not just target at meeting the needs of the heartlanders but deserving cases amongst the retrenched PMEs should also have access to some form of financial assistance.There should be a visible and structured approach to facilitate the PMEsinto economic contribution again. Perhaps a Cooperative of sorts will be able to do that. This is in line with MCYS' recent promotion of social enterprise programmes.

This Cooperative can providebridging loans at low interest rate to address specific needs as in children's education, daily necessities such as utility and conservancy bills and providing links and network for starting up self-employment programmes. A portion of the ComCare Fund can be used for this.

It has been reported that many of the retrenched PMEs,