Hansard, 2005-03-03

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 Davinder Singh 03 Mar 04 Mar Mr K Shanmugam 03 Mar 08 Apr Mr Othman Haron Eusofe 12 Mar 19 Mar

ABDULLAH TARMUGI Speaker Parliament of Singapore

Order read for consideration in Committee of Supply [2nd Allotted Day].

Head R - Ministry of Law. Amendment No. (1), Ms Indranee Rajah.

Arbitration Hub

Sir, I beg to move,

That the total sum to be allocated for Head R of the Estimates be reduced by $100.

I would like, if I may, to comment on the topic of arbitration and Singapore as an arbitration hub. Arbitration is different from litigation in the following way. Litigation is a mode of dispute resolution in the court system. Arbitration, on the other hand, is a private, consensual mode of dispute resolution. The difference between arbitration and litigation is that in arbitration, you can choose your judge, you can choose your counsel, you can choose your law and, most importantly, it is private, which means that confidentiality is preserved. This makes arbitration a particularly suitable mode of dispute resolution for regional disputes where, for whatever reason, parties do not feel comfortable taking their disputes to the court of their relevant country. In most cases, it is usually because they wish to preserve confidentiality, and court proceedings, of course, are public proceedings.

I feel that Singapore has not realised its full potential to be an arbitration hub in the region and that there is a lot of room for growth for arbitration services in Singapore. It is true that we have made headway since the setting up of the Singapore International Arbitration Centre (SIAC) and the cases have been steadily growing. In 1997, I believe the number of cases was around the region of 57 or 58. For the past four years, it has been between 82-83. But in the past few years, the numbers have plateaued off, and I think that we have a lot more potential for growth.

Singapore is actually uniquely poised to be the arbitration hub for the region. And I would like to highlight three or four

The first point is that Singapore is able to deliver neutral justice, and this is very important because parties, and in particular foreign investors, want to be sure that their disputes are resolved without fear of bias or corruption. At the same time, if a person is a foreign investor from an Asian country, he may not be comfortable to arbitrate in his Asian country. And vice versa, the Asian investor may not be comfortable to arbitration in the western countries, because of homeground advantage. Singapore, on the other hand, has a reputation for being neutral and having good infrastructure for legal services. So that is one strength.

The second strength is the high quality of the jurisprudence and legal services available in Singapore.

The third strength is the wide choice of counsel that is available to parties. With the recent amendments to the Arbitration Act to make it quite clear that foreign counsel can arbitrate in Singapore, even on Singapore law contracts. Effectively, what it means is that any disputant who wishes to arbitrate in Singapore has a choice of all law firms in the world to represent him.

Finally, I would like to espouse, if you like, the advantages of Singapore law as a governing law. You do not need to have a contract governed by Singapore law in order to arbitrate here. But Singapore law has this unique advantage. It is almost exactly the same as English commercial law which makes it acceptable to westerners. But, on the other hand, it is also the law of an independent and sovereign Asian republic, which makes it acceptable to Asian countries. Because of that uniqueness, it has a certain attractiveness to people when they want

Sir, I hope that the relevant Ministries, not just Ministry of Law but all the other agencies that promote Singapore law, such as MTI, EDB or even the Singapore Business Federation to which the SIAC reports, will bear this in mind and use this as a tool for marketing Singapore law.

I also think that in order to develop our services better, it would be helpful if we had better transcription and translation services which, at the moment, we do not have. And also if the hotel industry could play a part in providing better Internet facilities, secretarial services as well as other infrastructure to promote arbitration.

points which I think are our greatest strengths, and these are actually intangible in nature. to invest in the region, as a law that can satisfy both parties.

Mr Ahmad Khalis, you have two cuts. You can take them together.

Alternative Dispute Resolution

Sir, Alternative Dispute Resolution (ADR) has been widely used in our courts as part of the legal process. It has developed in sophistication and many would say in importance for the last 10 years. It is a process whereby in the midst of a legal process in court, the matter is transferred to a parallel track where the court and the parties attempt to resolve the matter via mediation instead of litigation. If this process fails, then the matter is restored back to its original litigation track. The question is: how effective has the ADR been? Has the ADR actually increased cost of the parties, since mediation can sometimes be quite circuitous whereas litigation offers more certainty, especially in terms of time? Can the Minister enlighten us on the success rate of ADR?

Based on its performance so far, what is the future of the ADR? If it has been proven successful, are there plans to

Insolvency

On insolvency, we know that since the onset of the economic crisis followed by a string of devastating events, the number of people made bankrupt has increased. How does the IPTO respond to the significant rise of bankruptcy cases in recent years? Are there extra measures taken to enable bankrupts to be discharged and to facilitate practical early settlements? Statistics show that in 2004, about 50% of those made bankrupt were discharged by the fifth year. About one-fifth of these were discharged by the third year.

Some creditors have been heard complaining that debtors were abusing the bankruptcy mechanism. I would like to ask the Minister whether this complaint is valid. I would also like to ask whether the IPTO is able to identify such abuses, if any, from those who are genuinely unable to pay. And, if so, how does IPTO handle these abuses?

Looked at from another point, how effective is our bankruptcy mechanism in helping to get debtors back on their feet again? There are those who burnt their fingers, hands, sometimes even their arms, due to the plummeting property prices or genuine business failures. Their debts may run into six or seven figures. Having no money now, they cannot reasonably be expected to repay much. Are they constrained by our insolvency regime from starting life afresh? Are the present criteria for discharge too stringent for them?

Bankruptcy is a very severe form of legal enforcement. In the case of companies, either party can apply for judicial management. It is a stage before winding up. It allows the debtor company to be managed by a professional third party. This helps the creditor in that it secures the assets of the debtor company from being unfairly dissipated. At the same time, if done well, it saves the debtor company from being placed under liquidation. I would like to ask the Minister whether there are plans to introduce a similar half-way house for individuals.

There are credit counselling services at the moment. However, here, the arrangement has to be forged mutually and voluntarily. One party may just refuse to agree as there is no legal obligation to do so. Perhaps this half-way house mechanism could bridge this gap.

expand in scope? For instance, in cases where parties have smaller claims size, the Small Claims Tribunal does not have jurisdiction to hear certain cases, eg, those that may involve complex legal issues such as those found in hire purchase or property disputes. Such disputes usually remain unresolved. If parties bring them to the Subordinate Courts, they will be subject to the usual legal costs, which are too costly compared to the amount of claim. Yet, the amount in dispute, say, $12,000 is not small when the average pay of the party concerned is about $2,000 per month. So, is the Ministry considering ways to plug this gap by introducing an ADR type of mechanism for small claims which are currently outside the purview of the Small Claims Tribunal? I believe that as we position ourselves as an international centre for arbitration and mediation, we should also enhance access to justice for our local citizens as well.

Bankruptcy Prevention

Sir, we are talking of Ministry of Law, but my focus is still on financing.

Sir, while cultural changes are taking a long time to happen, it is not easy to change the mindset among people to accept failures. But I think what we can do is to at least avoid people from being bankrupt in the first place. The general feedback I normally get is that the people,

Sir, I would like to suggest two things. First of all, the judicial management that Mr Ahmad Khalis talked about. While it is working, it is probably not effective enough. I would therefore like to suggest that we look at something like Chapter 11 in the US, where instead of judicial managers managing the process, we let the companies continue to manage because they know best how to operate their companies, even in times of difficulty. From what I understand, judicial managers have problems actually operating the company without getting the help of the management themselves. There are also onerous tasks put on judicial managers. For example, they have to take personal liability for any new debts that are incurred. So I think a Chapter 11 system may eliminate some of these problems and make it more effective in avoiding bankruptcy.

The second thing I am proposing is something akin to Chapter 13 in the US against something that Mr Ahmad Khalis talked about, ie, a similar mechanism to avoid bankruptcy for individuals. And if we can do that, the work may be a bit more onerous on the Ministry side, but we can at least help avoid bankruptcies so that businessmen could at least try to recover, take responsibility for managing their debts and also continue to do their businesses rather than to be made bankrupt. Because after they are made bankrupt, there is a tremendous difficulty in Singapore for any one of them to recover and to start a business again, unlike in the US or in other places which are more entrepreneurial.

Sir, I hope that the Minister will take these two suggestions into consideration.

who were bankrupt before and came out of bankruptcy, find it very difficult to access to finance, whether it is banks or VCs, or even from their friends and families. The best thing that we can do is avoid bankruptcy in the first place.

Dr Mohamad Maliki, you have two cuts. Take them together, please.

Dealing with Bankruptcies

Sir, my first cut is on bankruptcies. I echo the points made by both Mr Ahmad Khalis and Mr Inderjit Singh.

Sir, we have heard much about the rising trend of personal bankruptcies over the last few years. The detailed effect of bankruptcy on the person and those around him is still relatively unknown, although anecdotal account suggests the reduction of self esteem, heightened marital discord and even marital dissolution. I have seen young people coming to see me and asking me for help to be declared bankrupt. These are those who are really at their wits' end, something that I had never expected before.

These are people who are younger than me. Yet, they choose bankruptcy as an option in terms of coping with the mountain of debts that they have incurred, and the relentless harassment from the creditors or debt collectors, not to mention the legal suits filed against them. Sir, yet, we can always say that they are responsible for their actions. They choose to take up those credits. They failed to exercise financial prudence. But what is worrying is that these people are getting into such a state at such a young age. Their days are often filled with glum and they have very little hope for their future. The future of their children is also at stake.

I would like to ask the Minister whether his Ministry has tracked the profile of these cases of personal bankruptcies. Also, is there a growing

trend of individuals seeking to be declared bankrupt as a way of coping with unmanageable debts? I think we need to understand more about these bankruptcy cases and develop more upstream preventive programmes to ensure that the problem does not worsen, again on what Mr Inderjit Singh suggested earlier. There is much that we can do if we are able to identify this group which is at higher risk and possibly target intervention programmes that can subsequently be developed.

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I would also like to ask the Minister whether there are plans to develop programmes that will educate Singaporeans on the implications and effects of bankruptcies. In this regard, I would like to suggest that the education includes implications of bankruptcies on their assets that they have, especially, for example, their HDB flats if they take mortgage loans from commercial banks. Many may not be aware that they risk losing their flats if these flats are actually mortgaged to commercial banks.

Intellectual Property

Sir, my second cut is on intellectual property. The intellectual property laws were enacted recently to ensure that Singapore provides a competitive environment for innovativeness and for inventors, owners of ideas, to feel that ownership of original ideas and inventions is safe and protected. I wonder to what extent are Singaporeans aware of the new developments with regard to these new laws in relation to intellectual property (IP). I am concerned with the potential impact on the common man with regard to infringement of these laws, especially if many are unaware of what these laws actually mean to them.

Specifically, Sir, I would like to raise the issue of ensuring that consumers at

More importantly, Sir, I wonder if the Ministry is aware of the current level of infringements that is happening in the private homes here. Many youngsters do many things on their PCs in the privacy of their own rooms. They may or may not know if they are actually infringing the laws, but, more importantly, it is for parents to be aware of these implications of the law as many of them are not aware of what their children are doing on their own PCs.

Sir, we do not want a situation, like in the case of illegal immigrants renting rooms, where older folks who rent out their rooms to these illegal immigrants without knowing that they are actually violating the law. We saw some of them being charged in court and some were actually sentenced to prison. We do not want to see parents being dragged to court because of their children's actions.

I would like to suggest to the Ministry to consider embarking on a public education programme to ensure that Singaporeans are made aware of the new laws, especially to assist parents in monitoring their children's activities to prevent the violation of these IP laws.

home are aware of the extent to which they are infringing the new IP laws, for example, downloading music, etc, including what used to be done like taping programmes or movies off the television and, at times, make duplicates and perhaps share with other family members. Are Singaporeans aware that such acts are considered as infringements of the law? Distribution of duplicates is actually a violation of the IP laws.

Second-tier Patenting System

Sir, to foster and speed up innovative activities among new entre

The current IP registration process is quite costly and ranges from about $30,000 to more than $100,000. This cost is prohibitive for the majority of start-ups and even for some established SMEs. I believe, Sir, that our existing system could benefit from the consideration of a second-tier patent system to provide cheap, fast, limited rights for lower level or incremental inventions. SMEs and start-ups would be the main beneficiaries of such a lower level system.

In a mini research I conducted, I found that Australia has two systems of second-tier patents - petty patents and innovation patents. I would like to suggest that we should look at these models and modify them to suit our needs. The development of the Australian second-tier patent protection is premised on the need for a quick, less expensive and more easily obtainable patent protection for inventions with a short commercial life. It also provides an avenue to protect functional innovation, that is, innovations which lack the level of inventiveness required for patent protection and whose functionality was not protected by design laws.

preneurs, we need among a host of other measures to provide intellectual property (IP) protection that is relatively inexpensive, less cumbersome and one that can accommodate inventions with short commercial life. This will help to promote and support the culture of innovation and enterprise and assist start-ups.

Land Acquisition Act

My next cut, Sir, is on the Land Acquisition Act, and I have three points to make.

The first point is whether the Minister would consider redrafting section 33(5)(e) of the Land Acquisition Act. That section governs the compensation that is to be

The second point I would like to highlight is the problem created by road zoning. Prior to the 1998 Masterplan, there were road interpretation lines. After the 1998 Masterplan, all the road widening lines were zoned roads. The intention behind that was a good one. But the problem was that you have a piece of land which before just had a road widening line. And when compensation is made on the basis of zoning, you take into account the whole piece of land and you compensate on the basis that it is car park or it is residential. But once a portion of it has been zoned "road", the value immediately becomes zero. So, it has an impact on the Land Acquisition Act. Because when you acquire, let us say, the whole of the land and one-quarter of it is zoned "road", in the past you would get compensation for the whole piece of land, but now you get compensation essentially for three-quarters because the last quarter effectively has a zero value, and that is what happened in the case of the car park that was acquired from the church that owned the land. This is an unintentional

The third question is whether or not the Minister would consider the reverse Pointe Gourde principle. Basically, if there is an increase in the value of the land as a result of compulsory acquisition scheme, you disregard that. But the converse is not true - you do not disregard a decrease. It means that it is a double whammy for somebody who has the land acquired. I was wondering if the Minister would consider whether it is a matter of policy, so that we would be able to review this.

paid when land is acquired. And it says that the compensation would be the market value of the land, but it must not exceed the price that a purchaser would pay for it on the basis of either existing use or in anticipation of continued use of the land for the purpose designated in the development baseline referred to in section 36 of the Planning Act. The problem though is when you refer to section 36 of the Planning Act, it does not talk about a purpose. It talks about the development baseline which is a value. So, the two do not match, and it does not actually make sense in plain English. In fact, I would strongly recommend that anybody who wants an instant migraine should try reading the two sections of the different Acts together. You can in a very roundabout way figure out what it means, but it is an extremely convoluted way of doing it. So I would ask if that provision could be amended. and unforeseen problem, but it is something that does need to be redressed. I understand that there is a discretionary fund, but that should not be the case. Compensation should be made in accordance with the principles.

Open Space for Public Use

Sir, over the years, I have raised the issue of the Singapore Land Authority (SLA) allowing the public to make use of open public space for recreational and other public use. I am very happy that over the last three years, SLA has opened up a lot of open space for use by the public, in particular, by grassroots organisations. In my own constituency, they have allowed me to put up a big hard court, which is very well used on weekends and in the evenings. I think this is something I would like the SLA to go on and open up more space.

I would like to ask the Minister how SLA intends to open up more public space, in particular, even public buildings which are not being used at present, for more use by the public and even by business enterprises at a lower cost. Perhaps the Minister could address this issue.

Sir, first, I want to thank Ms Indranee Rajah for her strong support of the desire to make

The SIAC, in particular, has done a lot for our positioning as an international arbitration hub. Together with the Singapore Maritime Foundation, it has established the Singapore Chamber of Maritime Arbitration, a purpose-built institution for maritime claims. It will also be setting up a joint venture dispute resolution centre in India, in partnership with India's Construction and Industry Development Council. It also sets up Asia-Pacific's first registry for lodging arbitral awards to authenticate awards prior to the enforcement.

Ministry of Law, on its part, has set up an ADR Advisory Committee to be a forum for feedback and input on how further we can make progress in this regard. This Committee has practitioners and representatives from local ADR institutions, ADR practitioners, academia, Government representatives and members of the Judiciary.

She is right that for an arbitration hub, we need ancillary services like transcription, translation, hotels. We are looking

She made the point, and I agree with her, that the choice of law and the advantage of Singapore law is important in arbitration. She will be aware that the Academy of Law actually established a Working Group, chaired by Judicial Commissioner as he then was, Mr V K Rajah. They concluded that while Singapore law was not in the position to supplant the US and UK laws completely in business dealings, it could be the preferred alternative in this region. So, she is right here. The greater use of Singapore law in international transactions will bring benefits in the form of more work for legal services and other related services. I think that our commercial law and our legal system can be like a bridge between the businesses in the East and the West, and we should take full advantage of this.

The Committee, headed by Mr V K Rajah, makes some very useful and practical recommendations which I do not have time to go into the details here, but these recommendations are designed to further the use of Singapore law in arbitrations, contracts and legal instruments. The Chief Justice and Ministry of Law have accepted the recommendations of the Working Group. Mr V K Rajah now heads a committee for the international promotion of Singapore law to implement these recommendations.

Mr Ahmad Khalis spoke about ADR, and I also welcome his support for these moves. His question was ADR vis-a-vis

From 1994 to 2004, some 48,300 civil matters were mediated, with an average settlement rate of over 94%, which is very good. For community disputes, amendments were made to the Community Mediation Centres Act last year, and this strengthened the power of the magistrates to refer appropriate disputes to mediation at the Community Mediation Centre without the need for the consent of all the parties; so that has helped. This way, suitable community disputes are now being channelled immediately to a pilot CMC facility co-located at the Subordinate Courts' premises itself. So this procedure that we have put in place results in savings of cost and time, as the parties will be able to make only one trip to the Subordinate Courts and, if their dispute is resolved, they need not proceed further with their complaint. The results of this pilot project have been positive. Since it was piloted in May last year, some 140 cases have been mediated in the facility, with a 71% success rate.

In the Supreme Court, the parties are not required

Singapore an international arbitration hub. It is true that there is tremendous potential to be tapped. But last year, we made very good progress to strengthen our position as an arbitration hub. For example, the International Chamber of Commerce and the Singapore International Arbitration Centre (SIAC) held the first ever symposium on international arbitration which attracted over 160 participants from 10 countries. Other major events lined up include regional conference of United Nations Commission on International Trade Law, which will focus on the Model Law on International Commercial Arbitration. The International Bar Association and World Arbitration will also be held here. And down the road, we are looking forward to the 16th International Congress of Maritime Arbitrators.into these. They are, of course, readily available in the market, and SIAC has been using them extensively for arbitrations. When parties for ad hoc arbitrations approach SIAC, SIAC certainly helps them locate and secure the necessary services. And I would assure her that MinLaw and SIAC will continue to develop networks of related service partners to ensure that arbitrations held in Singapore will benefit from the best availability of such services.the courts. I think that while litigation in the courts will continue to be the integral part of our dispute resolution infrastructure, in the past 10 years or so, substantial progress has been made in developing ADR infrastructure and building up an ADR culture. In the Subordinate Courts, mediation and ADR are used extensively to complement the traditional court processes in the form of Court Dispute Resolution (or "CDR" for short). Over the recent years, CDR has broadened to cover civil cases at an earlier stage of the proceedings as well as the use of online virtual mediation. So, in answer to Mr Ahmad Khalis, the answer is, yes, ADR in the Subordinate Courts does provide a less costly, faster and a more harmonious method of resolving disputes by reaching an early settlement. I think it has proven to be very effective. Mediation is used not only in civil cases but also in family, small claims and magistrates' complaints cases.

to first undergo mediation before their cases are heard. However, they may do so at the Singapore Mediation Centre. And there has been positive feedback in this regard. 83% of the parties involved in SMC-related mediations have indicated savings, in terms of time and money. There are no plans currently to introduce separate mediation processes for claims which are currently not heard by the Small Claims Tribunals. The reason is there exist many other existing avenues for the resolution of disputes.

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I take note of what Mr Ahmad Khalis said about hire purchase disputes, and property disputes. It depends on the nature of the dispute because some of these hire purchase disputes can be referred to CASE for their processes. Property disputes, of course, can be very diverse in nature and I will have to have details of the type of property disputes he has in mind. If it is consumer-related, CASE or professional bodies which have ADR can look at the matter. If they are more serious, they could be referred to the Strata Titles Boards. And if they require more specialist treatment, then bodies like the Singapore Institute of Surveyors and Valuers have their own mediators which can handle these matters. So basically, we have a whole range of ADR in Singapore, and this is not finite. We have to look at how we can develop this ADR mechanism and see if there are other clusters or areas of disputes which are not catered for, and if so, I will be open to suggestions as to how we can have additional ADR facilities.

Now, I turn to the comments made by Mr Khalis, Mr Inderjit Singh and Dr Maliki on insolvency, bankruptcy and so on.

In the area of bankruptcy administration, let me say that we have to take several considerations in mind. First, we need to strike a balance between the interests of creditors and the interests of debtors. Secondly, we do not want a situation where those who have become bankrupt do not take their financial obligations seriously and do not cooperate with the Official Assignee. So, the OA makes a distinction between those who are cooperative and those who are downright uncooperative. I think that is logical because the majority of bankrupts are uncooperative and do not make any efforts to contribute to their bankruptcy estates. They would be placed in the red zone and monitored more closely and made to observe more stringent requirements. Existing bankrupts also have to attend financial planning seminars so that they can better manage their finances.

If I may move on to the points made by Mr Inderjit Singh, basically his call is for

I am open to suggestions along the lines that Mr Inderjit Singh has made. But we have to look carefully at the pros and cons of both the Chapter 11 system and the judicial management system. I think Mr Inderjit Singh is aware that both have their upsides and downsides and both have their critics. The Chapter 11 model permits the people who may have gotten the company into financial trouble to lead the charge to get the company out of trouble. Some critics are of the view that Chapter 11 serves only to keep existing management entrenched to the detriment of legitimate creditors. Whereas under judicial management, the management which knows a great deal about the businesses is removed and, under such circumstances, it may be difficult to rehabilitate the company. So there are these pros and cons.

But there is an important committee which is looking into the introduction of an omnibus insolvency legislation. By "omnibus", I mean one that would have laws, principles as well as mechanisms applicable to both companies and individuals. The Official Assignee and Official Receiver formed the omnibus insolvency legislation committee last year, comprising representatives from both the

At this stage, I do not want to pre-empt the work of this committee by indicating what might be the outcome of the committee's recommendations. But let me elaborate what I have mentioned earlier about the wage reorganisation plan. This will be modelled after the Chapter 13 approach except that the wage reorganisation plan would be supervised by the Official Assignee, and not the court. Such a wage reorganisation plan will enable individual debtors to avoid bankruptcy by allowing them to enter into a repayment plan to repay creditors over a period of time, whilst under protection from legal actions by creditors. I think that would be a welcomed move. What would be the trigger event? The trigger event could be when a debtor receives a statutory demand from a creditor demanding payment. The details of the scheme will be worked out by the Official Assignee and the committee which I have mentioned. We hope that this scheme will offer some breathing space to cash-strapped debtors by giving them more time to repay their debts over a period of time. We hope that this omnibus legislation may be ready by the end of this year.

That takes me to Dr Maliki's points. He asked about the growing trend of younger people being made bankrupt. Let me say that looking at the age profile of bankruptcy cases from 1996 to 2004, it shows that about 6.4% of bankrupts are from the ages of 21 to 30; 32% between the ages of 31 to 40; and more than 38% between the ages of 41 to 50. So the majority of bankrupts, some 71% are in the age group of 31 to 50, and 6.4% in the age group 21 to 30. But in the last

Another point which I think Members would be interested is that we found that over 90% of bankrupts were made bankrupt because of non-business related reasons. And of this 90%, over 67% were made bankrupts because they have overspent on credit facilities, particularly credit card facilities. Statistics showed that more people are being made bankrupt or making themselves bankrupt and the figures rose sharply from 801 in 2003 to 941 in 2004. So what are we doing about it? The OA has set up a self-petition management team to closely monitor the self-petitioned bankrupts. We need to ensure that they are not abusing the bankruptcy process. We hope that people who self-petition do not do so under the false illusion that they do not have to pay their debts and would be automatically discharged after three years. Because that is not going to happen. We do not have a regime of automatic discharge and we want bankrupts to take their obligations to cooperate with the OA and the creditors seriously.

As to publicity and education, I agree that this is not only the work of the OA. We have to work together with other agencies to educate and make public awareness of people who run into financial difficulties or who may run into financial difficulties that self-petitioning is not a panacea for their problems. My colleague will take the rest of the questions.

First, Mr Khalis asked how the OA and IPTO have helped in assisting people who have got into financial difficulties or faced bankruptcy. Let me first say that, since 2002, IPTO has set up, what we call, a Pre-bankruptcy Advisory and Mediation Centre to encourage creditors and debtors to enter into mutually acceptable debt arrangement to avoid bankruptcy. And last year alone, close to 1,700 debtors have made use of this Centre's services. Furthermore, the OA is also considering introducing a wage earner's reorganisation plan which is similar to the US Chapter 13 approach, a point which Mr Inderjit also mentioned. This wage earner's reorganisation plan will enable debtors to repay their debts to the creditors over a period of time through the Official Assignee. It is close to what Mr Ahmad Khalis is envisaging as a form of "judicial management" for individual debtors. I will come back to this when answering Mr Inderjit's points. proposals to help companies and individuals to avoid getting into bankruptcy. He has suggested introducing the approach of US Chapter 11 so that companies in financial difficulties can apply to court for protection while they continue to operate with the same management team. I think that is basically the thrust of what he is saying. In Singapore, the judicial management system allows a company or its creditors to petition for the company to come under judicial management if the company is unable to pay its debts and there is a reasonable probability of rehabilitating the company or preserving all or part of its business as a going concern. The company would then be taken over and run by judicial managers. private and public sectors for the purposes of reviewing our insolvency laws and creating such an omnibus legislation. As part of this exercise, this committee is also studying the feasibility of introducing the Chapter 11 approach as well as the Chapter 13 approach suggested by Mr Inderjit Singh.four years, an average of 490 such young people are made bankrupt every year, and they account for 13% of bankruptcies every year and, of course, that is a source of concern.

Sir, first, let me address Ms Indranee Rajah's concerns on land acquisition. Sir, when Government acquires land, our approach is to pay a fair and reasonable total compensation

Sir, the next point I want to make is that if a portion of a zoned road is acquired, it will not necessarily result in nil or nominal compensation being awarded. The compensation amount payable for each property varies according to the physical attributes of the property and, of course, the facts of the case. Indeed, there have been cases where Government has paid compensation for strips of land that are acquired when it was zoned road. I understand that Ms Indranee had acted for a land owner in one such case. In that case, the Appeals Board took the position that the strip of land acquired had no market value on its own but awarded compensation based on severance damage.

Sir, compensation for severance damage is provided for under the Act, (section 33(1)(c)), ie, not given ex-gratia payment. The Land Acquisition Appeals Board used the before-and-after method to determine severance damage and that I think is something which lawyers will know - computing the compensation and deriving it from the difference between the market value of the entire lot before acquisition, less the market value of the remaining land after acquisition. Going forward, when we acquire land in part that is zoned road, based on the Board's approach, I would expect that there would be some compensation given, based on severance damage, in many of these cases.

Ms Indranee Rajah also asked whether the Land Acquisition Act should be

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The next point that I want to address is the application of the negative Pointe Gourde principle.

package, according to the provisions of the LAA's current policies and practices. I think she will also know that we have in place an ex-gratia payment scheme introduced in 1982 which we have, over several steps and several years, enhanced quite a bit. This is paid to land owners on a case-by-case basis to ameliorate hardship suffered by them. amended to clarify the reference to the purpose designated in the development baseline, referred to in section 36 of the Planning Act, and to consider also taking into account the negative Pointe Gourde principle in statutory compensation. I agree with her that the reference to the development baseline in the Land Acquisition Act does not define the purpose directly. However, the current drafting has been in place since 1998 and it is understood by those in the industry that development baseline refers to the paid-up developmental rights of a site. So there is no ambiguity there. I think, more importantly, as she has said, even though it is a circuitous road, the meaning can be derived.

There is a decision on that. The Court of Appeal has ruled by a majority decision that the principle does not apply in Singapore because it is not part of our law. So, the question is whether we should amend the Act to reflect the minority judgment and the views expressed by the judge there. Sir, we are reviewing the LAA, but I would say that it is unlikely that we will incorporate the negative Pointe Gourde principle, and there are good reasons for not doing so.

As Singapore develops, Government will continue to introduce measures to enhance the use of our limited land. Some of these measures may enhance the value of properties nearby; others may lower them. Indeed, Singapore's rapid development since independence is owed in no small way to the setting aside and acquisition of land for key infrastructure, including roads and expressways. For example, landowners benefit from enhanced property value when an MRT station or a giant retail centre is built nearby. Also, many Singaporeans benefit

The last point, which is also an important one, is that if the property on a partly zoned road is put up for sale, the buyers will factor the depressant effect of the road zone into the purchase price. That is the market value of the property for which the owner is compensated. In other words, if we disregard the effect of the road zone on the property value, we would actually be deviating from market practice.

Let me now quickly go on to Mr Ravindran's point. First, I thank him for making the cut again. I think, repeatedly in Parliament, he has urged us to do more to open up State lands and State properties, and, as he has shared, we have been doing this. So, we will continue with our pro-business and pro-community measures. As he knows, for community measures, we have opened up many plots of State land. For example, 78 TOLs have been issued for purposes, such as football and gardening plots, and at a discount to the market. In fact, now it is about 85% discount to the market. So, our residents all enjoy that on the ground. Recently, we opened up 153 pieces of State land, replacing "No Trespassing" signs with "Enter-at-your-own risk" signs, and that, as we see, has enabled many Singaporeans to use these fields on weekends and other times. Going forward, a hundred more of such lands will be

Another key thrust of SLA is to help businesses better use State lands. For example, under the partnership with EDB, SLA has released a number of former school buildings to private schools, and this has enabled them to quickly start off the programmes at a lower upfront investment. Also, SLA works with the film producers to make available old colonial buildings and other suitable sites for filming purposes. To encourage and reward creativity, SLA is currently considering proposals under the "first mover" initiative, under which companies that propose new business uses for vacant State properties would be given an advantage to secure the property for such uses, thus incentivising them to come up with new business uses for State properties.

Lastly, companies which propose new and novel uses for State properties at the tender submission stage will be recognised for their business ideas. We are now considering inserting an entrepreneurial clause where bidders can propose and price in innovative uses not specified in the tender. So, all these are new initiatives, and we will press on with opening up more lands and State properties.

The third point is on IPR by Dr Maliki. It is a good point. IPR has to be made known to Singaporeans, and indeed many things have been done by IPOS to reach out to all sectors of Singaporeans,

Going forward, we will do more, and parents and children will be able to have the benefit of knowing more about IP. For example, we have this "Honour IP" or HIP Alliance, which is a collaboration with IP rights holders. If you go to the cinemas - I do not know whether you have the time to do that - but if Dr Maliki has the time to do that, he will see that there is this campaign in the cinemas, outdoor and print media titled "Say No to Piracy". So, we will step that up.

Recently, we launched a short and light-hearted video "Copy Not Right". This contains useful tips on respecting copyright in both the physical and digital realms, something that Dr Maliki talks about, which will also be distributed in schools. With this outreach, more parents and children will know what they can do and what they cannot do. Indeed, right now, even as we talk, the International Trademark Association is holding the inaugural Asia-Pacific forum on "Emerging Issues in Brand Protection" here in Singapore. In another key development, the World Intellectual Property Organisation (WIPO), the UN's specialised agency for IT, is opening an office here in Singapore. So, we will continue with that.

The last point, which is raised by Dr Ahmad Magad, is on whether we should introduce a second-tier patenting system to reduce the cost and time taken to register patents, particularly for those which may be of a lower order, in terms of inventiveness, which may not qualify under the standard system and which may probably require a shorter protection time because it has a shorter shelf life.

First, I would say that the figures given by Dr Magad, ie, $30,000 to $100,000, appear to be on the high side, because to register a simple patent in Singapore, you probably need about $10,000, and this is the type of patents we are talking about, ie, simpler inventions. Nevertheless, I take his point that we should always be mindful about costs and also the time taken to register a patent. That is why, indeed, last year, in Parliament, I enacted amendments to the Patents Act to introduce a two-track system to enable inventors to register their patents within 42 months for the faster track, and 60 months for the longer track. Nevertheless, I have asked IPOS to study other systems which may be in place with regard to the second tier, because we always want to improve all the time. As to costs, too, of course, Dr Magad will know about the Patent Application Fund Plus which is administered to help SMEs, and that is his concern, and this fund will also help the financial aspect of it.

In short, Sir, we will consider this suggestion. If it helps, we will implement it. If it does not, then we would not. But whatever it is, we are open to suggestions.

from governmental action, eg, in up-zoning when the properties are given a higher plot ratio which can facilitate en bloc development. Of course, on the other hand, some landowners will suffer or may suffer if there is a columbarium built nearby or part of the land is set aside for road development. In short, Sir, some owners will enjoy a gain, others will suffer a loss. In any case, if landowners still suffer from financial hardship, the Government does give ex-gratia payments on a case-by-case basis in addition to the statutory compensation, and indeed this has been done. opened up. SLA also works with other relevant agencies, like MOE, MCYS, SSC, to open up various lands including, recently, one at Upper Serangoon Road for archery. Of course, schools are being opened up. But that is driven essentially by MOE and MCYS. We will facilitate. Then, of course, we also have a portal which sets out a comprehensive list of vacant State lands for viewing. Grassroots organisations can apply online for use of State land for community and social purposes. including SMEs. I think Ms Indranee made the point in her Budget speech, so did Dr Tan Sze Wee, on the need for us to educate SMEs and members of the public, including children and parents, that Dr Maliki talks about. So, this is being done, and more will be done. For example, last year was a busy year for IPOS. IPOS had many key programmes, eg, IP Consult series, software, asset management, seminars, grassroots and schools outreach. Indeed, even for school children, which is one of Dr Maliki's focuses, more than 10,000 students were exposed to IP matters through school seminars and talks alone last year.

We still have 10 minutes for clarifications. Yes, Ms Indranee.

Clarification on the road zone, Sir. It is true that there is a separate head for compensation of

severance damage. But that only works when it is high yielding land, because you look at the value before and the value after. So, if it is a high yielding land, like a petrol station, for example, there will be a fairly decent value. But if it is, for example, residential, and we are talking about a strip of garden, the land value will be quite small. And that is actually what happened in the case of the church carpark. In this, I would like just to refer to the Senior Minister of State's reply to Dr Amy Khor's question on 15th of August 2003, where, in fact, he said that the re-zoning had led to a valuation of a nominal $1, but he also said it is not the Government's intention to change the compensation approach and that the $1 nominal compensation was actually an unintended consequence. And because it has arisen out of an unintended consequence of the re-zoning under the Planning Department, I would therefore ask whether it can be reviewed and we can actually redress it by legislation, either by saying that if it is zoned road, you give it a certain consideration or, alternatively - and this may be for a different Ministry - instead of using a road zoned, either go back to road widening lines or use some other form of delineation for road lines.

Sir, the jurisprudence in this area is evolving, because the Appeals Board has been hearing cases on this aspect even after the Kim Keat Road case. That was the first case that caught our attention and, therefore, the Minister and I and other officials had a review to take a look at it. After further consideration, an amount of about $64,000 was given to reflect, in a way, severance damage, because it was calculated on the basis of what would have been the case as the carpark lots were taken away, and what was the severance damage that was being caused. But even the way of calculation also has moved on, because the Appeals Board, in recent cases like ExxonMobil and others,

has also, in introducing the before-and-after method, shown the way forward, in that even if it is not a throughput method - I think this is one way which has been the basis of computation in one particular case - if we take the before-and-after method, even if it is a garden that is being acquired which is part of a road - of course, I cannot say for sure - it is unlikely that compensation would only be nil or $1. So, that is the way to go forward.

Sir, I am a football player and, over the last two or three months, I am unable to get a football field because some schools are not being very clear in how they give out the school fields. While the MOS clarified how SLA has come out in the open and opened up school fields for use by the public, I think there are other agencies which could do more. Here, the schools definitely could do more. I am just wondering whether the MOS could help us, especially in his capacity as FAS Chairman also, to open up even the schools and to come up with a comprehensive and transparent scheme whereby members of the public can access public facilities, including school fields.

Mr Ravindran, FAS is not under the Ministry of Law, I am afraid.

Yes, Sir. I am just saying that he is the Chairman of FAS. Thank you for the clarification.

FAS does not control schools. Neither do we control principals. But I think the point is well made, in that really it is an inter-agency collaboration that is needed. So, whilst SLA can facilitate, other agencies must come on board. But I am happy and glad that this topic has been raised in many forums. Yes, indeed, we all know that there are many pieces of land, not least of which are the ones in schools. And principals may have their reasons for not

opening them up. But that I will leave to the Minister for Community Development, Youth and Sports and also the Minister for Education to consider. But certainly from SLA's point of view, we are more than happy to do our part.

Sir, I am pleased to note the Deputy Prime Minister's and Minister's reiteration that insolvency cases are dealt with according to principles, there is no one-size-fits-all policy, and there is such a thing as the red zone and the green zone. I think it is important that the public be continuously educated on this point. People who may be bankrupts one day should know what is in store for them, and that creditors would also know what their rights are.

Ms Indranee, would you like to withdraw your amendment?

Sir, I would like to thank the Minister for Law and the Senior Minister of State for Law for their responses and for clarifying the Ministry's stance and, in the circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $121,244,220 for Head R ordered to stand part of the Main Estimates.

The sum of $226,104,900 for Head R ordered to stand part of the Development Estimates.

1.00 pm

Head B - Attorney-General's Chambers. Prof. Ivan Png. Three minutes.

Outsourcing Civil Work

Sir, I beg to move,

That the total sum to be allocated for Head B of the Estimates be reduced by $100.

Sir, the Attorney-General is responsible for both criminal and civil legal work on behalf of the Government. The Attorney-General's 2005 budget provides for 143 legal officers. This makes the A-G's Chambers probably the largest in-house legal department in Singapore and possibly in the region.

My suggestion is that the Attorney-General follows the best practice amongst in-house legal departments. Specifically, my suggestion is that the Attorney-General outsource part of his civil work to private practitioners. This is done by governments in other jurisdictions, for instance, the UK. This measure would align with our objective of a lean Government and the best sourcing principles that Prime Minister Lee outlined in this House yesterday. This outsourcing of civil work will also help to further develop our private Bar's expertise in complex legal issues.

I thank Prof. Ivan Png. It is a refreshing change from the viewpoint expressed by others yesterday, ie, do not outsource too much.

But let me say first that the Attorney-General is amenable to outsourcing legal work in-principle in appropriate cases. And indeed, he does so in particular cases, for example, in some civil cases involving arbitration work. He outsources also cases in patent applications, claims against the Government such as, for example, claims against MINDEF and also claims before the Appeals Board in land acquisition cases. But we have to remember that the Attorney-General is the principal legal adviser to the Government and

Let me add also that on certain complex cases, the Attorney-General does consult external experts. But even here, some of the cases may involve Government policies. It could be highly confidential, if not, secret and it may not be suitable for outsourcing. Furthermore, from the viewpoint of cost, in some cases, it may not be economical to outsource and obviously, if it is not economical to outsource, then it does not make sense to do so.

The Member says that the Attorney-General's Chambers is the largest law firm or thereabout. Factually, that is not correct because the largest law firm in Singapore has close to 200 lawyers. But the more important point I want to make is that the Attorney-General's Chambers cannot be considered to be similar to a law firm because of the myriad functions which he performs. The AGC's work spans a wide spectrum. It undertakes civil work, criminal prosecutions, track legal developments in other jurisdictions, undertakes legal reform work and it drafts all the Bills that come up to this Chamber for enactment.

And from my personal experience - because I have been involved in the Pedra Branca and in the reclamation cases and ITLOS - they also have to be involved in international law and international legal matters, cases like Pedra Branca, reclamation case with Malaysia, advising Government agencies on FTAs and other international treaties, and so on.

In the area of civil work, the particular concern of Prof. Ivan Png, the Attorney-General has a very lean outfit of only 16

But, I repeat, the Attorney-General is, in principle, amenable to outsourcing.

is the Public Prosecutor under the Constitution and these constitutional functions cannot easily be outsourced, or what is the core work of the Attorney-General's Chambers may not be suitable, particularly where they touch on constitutional and administrative matters.legal officers in the Civil Division and considering that these officers provide legal advice and representation to 15 Ministries, eight Organs of State, including Parliament, the Civil Division cannot be described as anything but efficient, small and lean. If we outsource half, as Prof. Ivan Png has said, I think we will have problems in the quality of Bills and the Bills coming here on time, just to give one example.

Sir, let me clarify. When I said that the Attorney-General's Chambers was the largest, I said it is the largest in-house legal department. I was not comparing the Attorney-General to an independent law firm like Allen and Gledhill. I do again urge the Attorney-General to consider outsourcing. This is the practice in not only the UK but Australia, Hong Kong and other jurisdictions. I was motivated in part by an admiralty case where I understand the Government sent a junior lawyer against one of our most distinguished counsel, and the Government did not fare very well in that case.

I think every lawyer's dream is to win every case that he appears before the court. But as Ms Indranee Rajah will tell you, in the nature of legal disputes, we cannot get that ideal from the viewpoint of a lawyer, because in law, the very nature of legal disputes does not lend itself to a 100% perfect or correct answer. That is why we have Courts of Appeal.

Sir, I wish to thank the hon. Deputy Prime Minister for so kindly attending to my cut. Sir, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $46,227,880 for Head B ordered to stand part of the Main Estimates.

The sum of $615,000 for Head B ordered to stand part of the Development Estimates.

Head P - Ministry of Home Affairs. Ms Indranee Rajah, seven minutes.

Terrorism

Sir, I beg to move,

That the total sum to be allocated for Head P of the Estimates be reduced by $100.

The cut I wish to make is on the topic of terrorism. Essentially, the thrust of it is to enquire of the Minister what is the state of our preparedness for terrorism in case anything should happen in Singapore.

At a recent Home Team seminar organised by the Ministry of Home Affairs, there was a talk by Dr Rohan Gunaratna and a number of things which he said were very elucidating but also gave great food for thought. One of the points that he made was that Singapore has, by and large, been able to control the problem internally and we have got a good grip on the elements that have tried to commit terrorist acts here, in particular, the JI.

The concern now though is that the terrorists have moved their operations to the surrounding region, precisely where, it may not be that easy to tell. But the point is that a lot of the planning, the procurement and the developmental stages of a terrorist attack can now be taking place outside of Singapore. And if Singapore is a target, as we believe it is, then it is only the execution phase of a terrorist attack that will take place in Singapore. And that means that our window for detecting something like that becomes very short. As all security forces know, you are only

I would therefore like to ask the Minister on what efforts we have made in regional cooperation for counter-terrorism, what direction it is taking, and what we are doing to work with the security forces of the other countries.

The next question I would like to ask is how prepared is the Home Team. Over the years, the Home Team has developed. In the past, it was more focused on domestic crimes and sources of criminal acts within Singapore, which essentially means that the Police Force had been focused on local or domestic crimes and where the criminal involved was somebody who was either a Singapore resident, illegal immigrant or a Singapore PR. And the nature of the crime was very localised. However, now with the terrorist threat, the criminal that we may be dealing with is quite different, quite possibly somebody who has international links and contacts, somebody who would be smart, and who has links to international networks. The question is: what has been done, as far as the Home Team is concerned, to equip them to be able to deal with this new type of criminal element that we have to deal with?

And the third question is to ask what is his view of the state of the community's preparedness or emergency response. In our division, we had on last Saturday, helped to launch the "Ready Bag" exercise and part of the message behind that was to encourage Singaporeans to get ready themselves and to have their own ready bag. But the general sense, and this was highlighted in the Straits Times' report the following day, is that,

as strong as your weakest link. That means that internally for Singapore, no matter how strong we are, it is not dependent on our security forces alone. It is also dependent on the preparedness of the security forces of the neighbouring countries or countries in which terrorists may be planning activities. by and large, most Singaporeans are very comfortable because they have faith in our Home Team and in our security forces, which is a good thing. But, on the other hand, it might encourage them to feel too complacent. So the question is: what more can we do to raise awareness among the community and to get people to be prepared for emergencies without at the same time being paranoid or over-concerned? How do we strike this balance and what steps can be done towards getting the community to be psychologically prepared to deal with something in the event, for example, that we have an act of terrorism in Singapore?

Sir, in an article dated 31st December 2004, Dr Rohan Gunaratna, the person mentioned by Ms Indranee earlier, reported that in the last three years, nearly 100 medium to large-scale terrorist attacks against US, European and Australian targets were prevented. This is not to say that there were no planned attacks against targets of other countries.

So while their operational capabilities might have suffered, the terrorist ideology, an intention to strike, has not diminished. Dr Rohan also reported that groups like Al-Qaeda had transformed itself from a group into a global movement and I agree with his observation, the point again mentioned by Ms Indranee earlier. So we have tactics devised in Iraq, copied in London, members trained in rebel controlled areas like the Philippines and Afghanistan. Financing may come from Europe and Canada, raw materials and recruits from South East Asia or the Middle East, but the theatre of operation could be anywhere in the world, including Singapore.

To combat terrorism, international cooperation among governments must be enhanced. We can do only so much to harden Singapore as a target. Yet, this is

We also see that disparate groups have begun the Al-Qaeda ideology although they are not linked organisationally. So there is an urgent need to develop a response to the ideological front. Otherwise, the effort to combat terrorism is not complete. I wish to ask the Minister what efforts are being made in this regard. Is it useful to garner the expertise of educationists, religious scholars and community leaders to do this? Terrorism threat calls for close coordination between our armed forces, the police, civil defence, public health sector, community and religious organisations and schools. So, in Singapore, we have the post of Coordinating Minister for Defence and Security currently held by a Deputy Prime Minister, which in part reflects this concern. The Deputy Prime Minister has visited several countries. May I ask the Minister for his observations as to whether there is a need to review our current security structure. May I ask the Minister also for an update on the local security situation as regards terrorism.

insufficient if terrorist groups are free to recruit, plan, train and receive funds from elsewhere. I wish to ask the Minister what is the state of international cooperation to combat terrorism. Is it true that some countries are not being able to prevent seeds of terrorism from festering and are unable to check on terrorist groups conducting training? What are the factors that are holding them back and is there anything we can do to help them in this regard?

Homeland Security

1.15 pm

Sir, when all is quiet on the terrorist front, as far as Singapore is concerned, I get worried, because so far the track record of the terrorists has been that when it is too quiet, something is going to come up. So I usually get

I would like to ask the Minister whether MHA has received cooperation from the regional governments, in particular, from the Intelligence and Police Forces in our neighbouring countries. I would also ask the Minister to provide an update whether, in the recent past, there has been any arrest in Singapore or in the region over terrorist activities and links. Could the Minister also provide an update as to whether the Ministry has detected some degree of complacency among the people in Singapore, and what are the measures the Ministry has taken to make Singapore a hard target and, secondly, to keep the people alert and prepared for any contingency arising from any terrorist attacks?

worried when all is quiet. What I would like to ask the Minister is that, in view of the fact that several elements of the JI are still on the loose in Indonesia, and recently there was an arrest of three suspects with terrorist involvement in the Philippines, and thirdly, the fact that suicide bombers had executed a bomb in Southern Thailand, I think it is a cause for worry. I think it is opportune for us to now ask the Minister for his assessment of the security threat and the challenges posed by JI and other Al-Qaeda associated terrorist groups in Singapore and the region.

Sir, I thank the Members for asking these questions and also to sketch out their concerns on the threat of terrorism in our region as well as in our country. Before I go into detail to answer the questions, I would just want to say that we have made a lot of progress, internationally, to dismantle the terrorist network. But we know that terrorism remains a global problem which will not go away for a very long time, and terrorist groups will continue to retain their ability to mount surprise attacks. Who knows

Regionally, the Jemaah Islamiyah network has been severely disrupted but they retain the capacity to regenerate and conduct further terrorist attacks. The JI has many fertile recruiting grounds in the region and access to training camps, such as those in Mindanao, to train the next generation of terrorists. There is also evidence to suggest that the JI is leveraging on the hitherto independent terrorist groups which share the JI's vision and ideology. Apart from its links to the Moro Islamic Liberation Front (MILF) in the Philippines, there are indications that the JI has linked up with other groups to conduct terrorist activities. Several of those involved in the bomb attack at the Australian embassy in Jakarta in September last year, were not from the JI, but members of a like-minded organisation called the Banten group. So this further compounds the difficulties faced by governments and security agencies, as we are now dealing with a loose network of terrorist organisations, which operate independently, but share a common ideology. Disrupting one terrorist organisation is not likely to impact on the operational capability of the others.

But at home we have crippled the JI network. Currently, we have 36 persons under detention. Mr Ravindran asked whether there were recent arrests or not. We have 36 persons under detention and we have 17 persons placed on Restriction Orders for terrorism-related activities.

The terrorist threat to Singapore has not been completely eradicated despite our successful containment of the enemy within. Given Singapore's dependence on an open economy and open borders, terrorist elements from abroad and the JI fugitives who remain at large in the region, such as Azahari Husin and Noor Din Mohd Top, continue to pose a threat to our security.

Ms Indranee, Mr Ahmad Khalis and Mr Ravindran asked how do we cooperate and how well do we cooperate with our regional partners. Indeed, we have many areas of cooperation as we share a common objective. But we must understand that every country has a different social context. So the pace at which they are prepared to deal with the terrorist threat would depend on the political context of the country and I can assure Members that in Singapore we are very firm and determined to deal with this problem. In other countries, they would have other considerations and, therefore, we cannot take our example and impose it on them that they must apply the same standard. We understand their problems, but we will continue to work with them and share information which would be relevant to all of us.

We have indeed been sharing intelligence with foreign security agencies and this has led to the arrest of several JI members in the region. But capacity building is another important area, and we have shared our experiences on counter-terrorism and we have hosted training courses for regional countries. So we do as much as we could. But as Members know, we are small in size, we are limited in resources and we would do as much as we could.

We are also involved in various diplomatic initiatives on counter-terrorism and participated actively in many international and regional fora on security. For example, late last year, the ASEAN

Ms Indranee and my other parliamentary colleagues asked how well prepared is the Home Team. We know that security measures are many. We have to take stock of what we actually need and the kind of threat that we face and then we will apply and enforce them as we see the need. As we impose such measures, we will also impose inconveniences to the members of the public. So we must be prepared to accept such inconveniences as this is part of the reality that we face today, whether it is at our land checkpoints, airports in Singapore, or when we are in overseas airports which have tightened their security measures.

Let me take this opportunity to update our Members here on the kind of security measures we have taken or will be undertaking this year. Ensuring the security and integrity of the Singapore passport, for example, is an integral part of our overall security effort. Our Immigration and Checkpoints Authority plans to introduce the Singapore biometric passport by October this year. This new passport will contain the person's unique facial and fingerprints information. It will make use of an inventory control number as the passport number, instead of the current approach of using the NRIC number. Members would have noticed that when they fill up the passport number on a form, they write their IC number. But we all have one unique IC number. So even

This kind of information will help us in ensuring that lost or stolen passports will not be misused, in particular, when we now find that terrorists and other criminal syndicates misuse passports.

The validity of the new passports will be shortened from the present 10 years to five years because this is a biometric passport and as technology changes, we have to stay current. The 10-year passport would be too long a lifetime for a passport for it to take advantage of the technology changes. The biometric passport will speed up immigration clearance significantly, as well as to deter people from misusing the Singapore passport, thus upholding the reputation of the Singapore passport and facilitating our citizens' travel overseas.

With the threat to Singapore coming mainly from beyond our borders, as Ms Indranee pointed out, the first defence, of course, is our border. So border security is vital. Since last year, a new-generation travel document screening system called the Sentinel is being deployed around checkpoints. The Sentinel is capable of high speed, accurate travel document detection and counter-forging capabilities.

The land checkpoints will also move towards the full-scale implementation of the use of iris recognition for clearance of motorcyclists. Every day we have thousands of motorcyclists coming in from the Causeway into Singapore to work or to visit friends and we need a faster clearance system than the present passport system or smart card system. This technology has been proven to be accurate and fast and we could possibly use it for other motorists in future.

To enhance our cargo screening at the land checkpoints, the ICA will also be deploying a new generation of radiographic scanning systems, which are essentially drive-through portals for cargo vehicles. This will increase the rate of vehicles being screened and scanned, and enhance our security without causing delays.

Next, on aviation security. To tighten aviation security, the Police is exploring the installation of a Regulated Cargo Agent system (RCA) to replace the present Known Shipper Policy system. Under the Regulated Cargo Agent system, only cargo agents who meet the security requirement set by the Police and are audited by the Police will be certified as regulated cargo agents. Cargoes from the RCAs will be subject to a lower level of screening than those from other sources. This will facilitate the screening at our airports.

On maritime and port security, we have also enhanced the security of our maritime and port. We have complied with all the security measures adopted by the International Maritime Organisation since 1st July 2004. We will also be taking part

The vulnerability of soft targets is also being constantly reviewed. Since November last year, we have heavily armed police officers from the Special Operations Command to patrol the public areas to inject a strong presence of deterrence to the terrorists and criminals and to reassure our public. They are supplemented by roving patrols of the Auxiliary Police Officers and frequent visits by the regular Police officers.

To further strengthen our security at our MRT stations and trains, we will start a new unit dedicated to patrolling our MRT trains and stations in the second half of 2005. More details on this will be given by the Police at a later occasion.

Officers in this unit will complement the efforts of the train operators who have implemented security measures such as the enhanced use of CCTVs and the unarmed security guards at the MRT stations. Let me also emphasise here that the train operators are still primarily responsible of their own premises and their trains.

1.30 pm

this may be the calm before the storm. Nobody can tell. I hope nothing happens in Singapore but we must be prepared in the event that anything should happen in Singapore. We also know that last year quite a number of terrorist strikes happened in the railway stations in Spain, in banks in Turkey, in security installations in Saudi Arabia, and the radical ideology embodied by the Al-Qaeda clearly remains attractive and inspiring to many terrorist networks and groups world-wide.leaders met and endorsed the ASEAN Security Community Plan of Action to deal with terrorism. We are now also working towards the accession of the International Convention against the Taking of Hostages and the International Convention for the Suppression of Terrorist Bombings. In these efforts, we would collaborate very closely with the Foreign Affairs Ministry. So we will take steps to make sure that we find as many opportunities as possible to work with others.when the person loses his passport or when he replaces his passport when it expires, he will retain the same passport number. But that does pose some problems on the tracking of passports, particularly when the passport is lost and has been misused. If we just look at the NRIC number in the passport and consider that as the passport number, then we may have many copies of the passport with the same number. So one idea is to have a control number, which is the issue number of the particular passport, and that will be considered as the passport number, so that whenever a passport is lost, we know that this particular passport is lost and can be invalidated.Traveller's information can now be checked more comprehensively and accurately at the checkpoints without any increase in the processing time. This will contribute to our on-going efforts to enhance our border security. in a pilot of the Radiation Detection (Megaport) Initiative (RDI) with the United States. A radiation detection portal will be deployed at a container terminal to detect the trafficking of radioactive material that could be used to construct "dirty bombs".

The police closed circuit TV system will also be expanded to cover other parts of Singapore, including areas of security interest. We are now working with the public transport operators to enhance their CCTV systems and to integrate them with the police system. The Police is also exploring the enhancement of the CCTV system with intelligent software to automatically detect pre-defined suspicious behaviour.

At the policy and regulatory level, we are developing a Building Protection Framework to advocate the adoption of target hardening measures in all buildings in Singapore. In tandem with this, we will also create a register of key personnel of buildings. This register will allow us to quickly locate the critical pre-identified staff of the specific building to advise and assist our response forces during an incident.

One new area of concern is the pre-paid phone cards. In some terrorist incidents abroad, we know that terrorists had taken advantage of the anonymity provided by the pre-paid phone cards to perpetuate their terror acts. ISD has found that both the Liberation Tigers of Tamil Eelam and the Jemaah Islamiyah have made extensive use of pre-paid cards. Some countries, for example, Switzerland, have already put in place regulatory controls to address this threat. We are now studying the issue with a view towards imposing some form of regulatory controls on pre-paid phone cards.

Mr Ahmad Khalis also asked whether efforts are being made on the ideological front to deal with terrorism. The Government's approach has been to encourage our Muslim community to police itself against ideological attacks by terrorist groups such as the JI. That is, the community should implement its own measures to prevent radical and extremist individuals and groups from subverting and misguiding our own Muslims, and to ensure that our Muslims are ideologically inoculated against their dangerous beliefs. Such efforts are then less likely to disrupt the legitimate and peaceful practices of local Muslims. Moreover, when Muslims speak to other Muslims about religious ideology, there is credibility and authority. In short, the community is in the best position to ensure that its own members are ideologically inoculated against wrong and dangerous religious beliefs and teachings.

As for the JI and the MILF members who have been detained or put on Restriction Orders under the Internal Security Act, they are already undergoing religious counselling by religious teachers from the community, as part of the ISD's overall rehabilitation programme.

Ms Indranee also asked whether we are prepared to deal with unexpected disasters. Let me assure this House that we do have systems in place to deal with whatever eventuality that requires a national coordinated response. I think I have mentioned it before. We have a Homefront Crisis Management System which we have improved since the lessons that we have learnt from managing the Nicoll Highway incident and the Boxing Day tsunami. This coordinating structure, which cuts across various Government Ministries, is both flexible and scaleable to meet the full spectrum of threats that we are likely to face. At the operational level, all Government agencies work together to prepare contingency plans to address various threat scenarios, and there are emergency preparedness exercises to ensure smooth inter-agency coordination and operational readiness.

It is not just the Home Team that needs to be prepared. All our Government departments, where relevant to the particular incident, also need to be prepared to deal with any eventual crisis. One example that we ourselves experienced in 2003 was the SARS crisis. Arising from that experience, we decided that we need a more systematic way of coordinating ourselves and to define clear responsibilities for the respective agencies. So we set up the Homefront Crisis Management System together with the Homefront Crisis Emergency Group and also a Ministerial Committee chaired by me.

As for the Home Team, the Police and the Civil Defence have enhanced the

Mr Ahmad Khalis has also asked whether there is a need to review our current security structure since we are facing so many of such problems, and he asked about the work being done by the National Security Coordination Secretariat. We had a long discussion on this last year when DPM Tan talked about the new framework for national security in July in this House. The framework is in place. The agencies are working together and the National Security Secretariat is now fully functioning. They have their complement of staff and they are working very closely with all the Ministries concerned to study the various scenarios and possibilities and events that are likely to hit us. Let me again assure him that this inter-agency approach in dealing with such threats is not just confined to terrorism but also other kinds of national security problems that we may face.

Ms Indranee has asked whether our Police has adapted and equipped itself well in dealing with this new kind of threat other than crime prevention. Indeed, let me assure Ms Indranee and our colleagues here that the Police has, over the years, since September 11 in particular, taken many measures to deal with the new scenarios that we are now facing, ie, the threat of terrorism. And terrorism is not just local but also international terrorism, that others may come and perpetuate on us. The Police has worked

Within the police, the officers have also adapted to the challenges of fighting both terrorism and crime. So they are now paying full attention to both. They also understand that policing goes beyond crime fighting and maintaining law and order. The Police has set up a new Security and Counter Terrorism Division under the Operations Department of the Police Headquarters, to underscore the importance of counter terrorism work and to coordinate the various counter terrorism efforts within the Force.

Members also asked how well prepared are our people concerning the community. We know - and I have said this many times - that the Government, the people and the businesses must share the responsibility for security and being prepared. And I am glad to say that Singaporeans, over the last few years, have taken on this challenge and we have seen an increased interest among Singaporeans to report on suspicious activities of people hanging around their neighbourhood.

Last year, for example, the Police received 513 calls about suspicious activities compared to 212 calls in 2003. This is an increase of about 300 calls. This is a positive indicator of the growing vigilance by our people. But Singaporeans must go beyond just looking at some article and think that it is suspicious and that is the end of their role. I think they must go beyond that. What do they need

We only have to look at the many examples of self help, from the tsunami disaster, to appreciate how important individual ownership and self-reliance are for personal and national survival. To this end, the Home Team has been actively engaging the public to facilitate their preparedness. And the Civil Defence will continue to train the public on basic emergency preparedness skills.

The Police and the ISD will also continue to engage the public and the business sector. As Members know, in January, for example, DPM Tan and I met more than a thousand business leaders and we shared with them our concerns and we hope that they will also do their part.

For the building owners, we know that many building owners and managements have already formed their security watch groups and made plans to "hardening" business premises. The Police has also reached out to more than 15,000 people from the various sectors, such as nightspot operators, hoteliers and building managers to apprise them of the need to enhance security.

As part of the efforts to drive home the message of preparedness, the Civil Defence recently launched this idea of ready bags for households. I think Ms Indranee herself took an active part in this in her constituency, and I can see the keen response among her constituents. But, of course, the Straits Times' article of 27th February also wondered whether Singaporeans are equipped for a disaster because they thought that even though 80% of those agreed that it was a good

Finally, Sir, the various parties - the Government, the people, the businesses - have to work together to make Singapore an inhospitable place for terrorist groups and their sympathisers. Even if a terrorist incident were to happen here, despite our best efforts, we must be able to respond as a nation and we must be resilient, we must be socially cohesive, to recover from such an attack. Vigilance and preparedness are the key to making Singapore more resilient and there is no other way about it.

ability to handle a wide spectrum of emergencies. For example, the SCDF vehicles and the Civil Defence officers are now fully equipped with decontamination capability to handle emergencies caused by chemical, biological agents and other hazardous materials. All our police cars are equipped with bomb suppression blankets to cover suspected bombs pending the arrival of bomb disposal personnel. The Police has also developed a post-blast investigation capability to handle investigations into bombing incidents.with other police agencies overseas as well. To ensure that all police officers are fully in tune with this new mindset that is needed of them, ie, to deal with counter terrorism, we are putting all police officers through the counter terrorism course. Counter terrorism will be a common subject in the training curriculum of all our Home Team officers. This will ensure that they have a common baseline of understanding to deal with a terrorist threat.to do? We hope that they will also prepare themselves to react and to respond to an emergency and have the self-confidence and the strength to recover from a crisis should there be a terrorist incident in Singapore.idea, they do not see the need to pack a ready bag. This encapsulates their sentiment in one sentence - it all boils down to complacency. The result of this survey is not surprising because in an earlier Ministry of Home Affairs' survey, we found that 92% of the people surveyed agreed that the public had a role in keeping Singapore safe from terrorism, and 86% of them had confidence in the Government for its efforts on counter terrorism. In plain language, what this finding means is that the public is saying, "The Government will look after the problem for us." I think that is not good enough and, of course, we need to do a lot more work in convincing the public that they themselves have a role to play.

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Can I seek a clarification?

Okay.

Thank you, Sir. I would like to seek a clarification from the Minister regarding the new passport that he mentioned. I would like to find out when will the new passport be issued and once the new passport scheme is implemented, how long will the existing passport be valid, and what is the replacement schedule for the existing passports

if it is not longer than 10 years. Finally, since the validity period for the new biometric passports is five years, would he adjust the fee for the new passport issued? Would it be half the current cost, or would it be the same?

I am very happy to answer his question. But, first, on a point of order, this is really not part and parcel of the debate that we are having. Because we have got to consider how much slack time we have in dealing with the MHA cuts. We may have a lot of time but I think that is for the Speaker to decide.

I do not know whether Dr Wang Kai Yuen was here when I said that the new biometric passport will be issued in October and it is for five years. The fees are yet to be determined. We will notify the public once that is settled. I hope it will not be more than the present one. Whether the existing passports will continue to be valid, yes, the existing passports will continue to be valid. For those who hold a valid passport, please do not rush to change to a new passport when it is being issued. Otherwise, they will jam up the system.

Organised Crimes

Sir, I congratulate the Home Team for keeping crime rates downwards for most categories. How can we improve it? Drug abuse remains a problem, as we see a rise in abuse of synthetic drugs. The raw materials are harvested in one country, processed in another and then smuggled into Singapore, among other countries. Illegal immigrants underwent detailed preparations elsewhere before being conveyed into our country. Our intellectual protection laws are constantly challenged by pirates operating in other countries or supplying pirated materials from there. We can, to an extent, reduce such crimes by suppressing the demand side but the challenge is tackling the

According to a PERC report dated 27th October 2004, it is arguable that organised crime is perhaps a bigger emerging threat to regional security than even terrorism. The report adds that the problem is worse in countries where there are a lot of restrictions in the flow of goods, money, people, etc. Organised crimes exist in order to help people overcome these restrictions. There are countries in the region which have this problem. They are large growing economies and organised crime is inadvertently exported along with their legitimate goods. What is the Ministry's response to this growing challenge? Are we stepping up cooperation with countries in the region? Do these countries share the same concerns?

At home, Sir, crimes such as illegal lending, illegal prostitution and betting are also usually conducted by well-organised groups. What is the trend of organised crimes in Singapore? How do we ensure that this trend does not go upwards?

supply side. There is a common threat in crimes such as those I mentioned. They are transnational and organised.

Ms Indranee Rajah, you have two cuts. Total, 3 minutes.

Sir, can I take both cuts together?

Yes, please.

Vice

The first is on vice. One of the problems that has been recurring, or at least which my residents come to see me, is to express concern about foreigners coming to Singapore on social visit passes and engaging in vice activities, including solicitation and prostitution. Frequently mentioned are visitors from China, although by no means that is the only country from which they may

I have received reports from some of my grassroots and residents that there are instances of these women in coffee shops, for example. Some of the uncles do not seem to mind very much, but the aunties are really very upset about it. The main concern here really is we are an open society, and obviously we do not want to discourage people from coming here because we need to develop our tourism industry. But at the same time, of course, there will be people who abuse the privilege that is given to them by virtue of a social visit pass. So the question is: as and when they do these things, what can be done, in terms of enforcement, to reduce the problem? I accept that you cannot probably eradicate the problem entirely.

Drug Situation

The next question I have is on the drug situation and, in particular, synthetic drugs. Synthetic drugs are a growing problem. I understand that a number of instances of abuse for the traditional substance abuse, like heroin and opium, had been dropping, whereas, on the other hand, for synthetic drugs, they have been increasing. I would like to ask the Minister what strategies we have in place to deal with this growing problem. I would also like to highlight the concern that it is not just people of low educational levels indulging in this. There is anecdotal evidence that there are career professionals who indulge in it and in particular they go to neighbouring countries to have substance abuse there and then come back to Singapore. So I would be grateful if the Minister could

come. Singaporeans are concerned about this because it would appear that vice activities are no longer necessarily limited to the traditional red light districts, such as Geylang, for example. But the activities do appear to be spreading into other areas, like commercial districts and, in some cases, heartland areas. outline what strategies we have to deal with this problem.

Community Safety and Security Programme

Sir, the Community Safety and Security Programme, or CSSP, has been in place for several years now. Many CSS teams exist at the grassroots level and we see them in action sometimes when they go patrolling on their bicycles around the neighbourhood. Much has been said about how we cannot take our safety and security for granted, especially in the light of potential threats of terrorism. I sense that, since the episode of the arrest of JI operatives a couple of years ago, Singaporeans seem to begin to take the issue of safety and security rather lightly. There is a sense that the Government, specifically the Home Team, is very much in control and that we should not be too unduly concerned.

Sir, while credit goes to the Home Team for their efficiency and effectiveness that led to Singaporeans feeling safe and secure, we must drive the point that safety and security is the responsibility of every Singaporean. In this regard, I would like to ask the Minister to what extent are Singaporeans involved in the CSSP in their respective communities. I believe strongly that we must make Singaporeans take ownership of the environment which includes their safety and security issues. I have come across residents who often give feedback on security issues in the neighbourhood and, when invited to join the CSSP, they give the reason of lack of time for not participating. They still expect the Police to make their rounds and some expect these rounds to be made very regularly.

Sir, we know that this is not possible as the Home Team has its own limitations. I think the CSSP is an

excellent platform for greater partnership between the Home Team and the grassroots and community. It will go a long way in reducing the incidences of petty crimes in the community, if more people are involved in CSSP. I would like to ask the Minister what are the other plans that he has in expanding the role of CSSP to ensure that more Singaporeans take ownership of the safety and security in their immediate neighbourhood. Are there specific plans or specific target groups that the Ministry has to encourage more participation?

Bird Flu

Sir, in my opinion, the possibility of a terrorist attack here is a lot more remote than when compared to the likely threat of a bird flu human-to-human transmission occurring in our neighbouring countries and in particular, in Singapore.

I read of how the virus is constantly mutating and infecting people in Vietnam, Thailand and Cambodia. Our real fear begins when it starts jumping from patient to patient as quickly as the SARS virus did. My question is: how is the Home Team putting its efforts and resources together to get Singapore totally prepared in this Total Defence plan against this invisible enemy - the H5N1 flu virus - that will also potentially cripple our economy much more badly than when SARS hit?

If the bird flu virus eventually mutates and evolves into this deadly human transmission form in our region, how is the Ministry working to prevent its entry into Singapore? Are we totally prepared for any such outbreak of this life-threatening flu pandemic in the unlikely event if it ever happens? What is the Government's Total Defence plan that will involve all Ministries on this matter?

Search of Internet Service Provider

Sir, the system of laws, regulations and practices regarding police search of company held records in the investigation of frauds, both by insiders or by customers, has developed over the years based on paper-held records. Such records could be searched manually by law personnel officers armed with a search warrant. If the records were seized for further search, the files could be carted off but the business will continue. Basically, Sir, the State pays for the time of the law enforcement officers performing a search.

However, as information technology becomes pervasive, records become increasingly stored in digital storage media. Still, the enforcement framework works because these are big businesses. For fraud committed by users of these service providers, the cost of the search could be borne by the service providers as part of doing business. Nonetheless, over time, the burden is being shifted to the business.

However, in the Internet age, many small infocomm service providers have sprouted up and these include voice over IP, prepaid phone card companies and website companies. In such businesses, the profit margins are low and the number of customers could be potentially very high. Many such businesses are one-man shows running on shoe-string budgets. In police investigations into potential crimes committed via the service provided by such providers, the use of the existing powers of the police seems to place an increasing burden on the service providers. In fact, we just heard from the Minister that he is thinking of changing the law to ensure that pre-paid phone card company would keep records in case of terrorism. This burden would be in the form of time committed by the providers during the search.

Most of the time, the police officers, being unfamiliar with the system, would have to be dependent on the operators to spend time and effort to do the search. This would be a departure from the old framework where the police officers themselves could perform the search. Consequently, this seems to shift the burden of the search from the State to the individual. It is also unreasonable to threaten the businesses that if they do not cooperate in the search, their assets would be seized for the police to conduct the search themselves, as they are empowered to do so. It would be unnecessarily punitive to seize and cart off the asset and storage media of these businesses. After all, they are just the service providers. They did not commit any crimes or offences.

My question is whether the brute force approach using existing legal framework needs to be reviewed in this age of electronic transactions, especially for small businesses. We could insist that this is part of doing business in Singapore but it will be a burden. So perhaps the Ministry can look into this and come out with a different approach, maybe train the officers or engage a third party expert to do the search.

First of all, Sir, I thank the Members for raising these questions and giving me an opportunity to explain what we do in the Home Team and also I want to thank Mr Ahmad Khalis for commending the Home Team for tackling crimes at home. Indeed, the domestic crime situation in Singapore has remained stable and under control with the total number of seizable offences rising slightly by 3% to 34,480 offences compared to 2003. This increase was at a slower rate compared to the 5% increase from 2002 to 2003. Minor crimes, such as theft and related offences, accounted for much of the increase and can often be prevented if crime prevention measures are undertaken by the victims. The

Mr Ahmad Khalis also pointed out that crimes, such as drug abuse, illegal immigrants which is human smuggling in some instances, and intellectual property right violations have also an international dimension. Let me assure this House that we have put in place several measures in both enforcement as well as the legislative framework to tackle the menace of international organised crimes.

number of arrests made has also increased by 6.4% with nearly 25,000 people arrested last year. However, most of the major offences, such as house-breaking, robbery, rape, cheating and related offences, registered increases. So Members can see improvement in some areas and, of course, slight deterioration in other areas.

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In terms of enforcement cooperation, the Singapore Police Force (SPF), the Immigration and Checkpoints Authority (ICA) and Central Narcotics Bureau (CNB) have regular information and intelligence exchanges with their foreign counterparts. These networks are essential in helping the Home Team tackle all the ill-effects of transnational crime. Aside from this, cooperation between the various Home Team agencies and their foreign counterparts also extends to the development of joint training programmes and the strengthening of institutional frameworks, for example, regular meetings among them, sharing of data and information on intelligence.

One such example specifically is the Interpol I-24/7 Communications System (I-24/7), which was adopted by the police force in 2003. Singapore is the first country in ASEAN to implement this. The core function of I-24/7 is to facilitate speedy communication between member countries on a 24-hour, 7-days-a-week

Cooperation and information sharing between the Royal Malaysian Police and the Singapore Police Force led to the crippling of a human smuggling syndicate and the arrest of the syndicate leader, together with his two henchmen, by the Royal Malaysian Police in October last year. They were extradited to Singapore and were eventually convicted.

The police force has also successfully cracked cases through multilateral cooperation, such as an FBI-led operation involving 13 other countries. A world-wide simultaneous raid was conducted against members of an international Internet piracy organisation called "Fairlight�?. Four persons were arrested in Singapore, and software worth S$10,000 was seized. Singapore was the first country to successfully convict the syndicate members in this operation.

In terms of legislative framework to facilitate international cooperation with foreign authorities, we had enacted the Mutual Assistance in Criminal Matters Act in April 2000. This Act enables Singapore to provide legal assistance in criminal matters to other foreign authorities, and vice versa.

To this end, Singapore has signed a multilateral Mutual Legal Assistance Treaty (MLAT) with seven other ASEAN member countries, as well as a bilateral MLAT with Hong Kong. These treaties allow the signatories to provide each other with assistance in criminal matters, such as the taking of evidence and the service of documents. Singapore is also a signatory to the United Nations Convention Against Transnational Organised Crime. MHA recognises that regional and international cooperation is critical in the fight against transnational organised

Let me now turn to the issue of vice, which was raised by Ms Indranee Rajah and Mr Ahmad Khalis. The police has been closely monitoring the vice situation, and has stepped up enforcement action. In 2004, a total of about 5,200 female foreigners were arrested for involvement in vice activities, compared to 2,300 in the year 2003, and 3,400 in the year 2002. This dip in 2003, if we remember, is because we had a few months of the SARS crisis in the region. Any foreigner found to be involved in vice activities will be repatriated and banned from re-entering Singapore.

To some extent, the increase in vice arrests is not unexpected. In recent years, we have been attracting more visitors. In particular, the number of female visitors from the top nationalities arrested for vice has increased by 37% between 2002 and 2004. The increase in vice arrests is due in part to the liberalised visa policies introduced to support our tourism efforts.

We do recognise that we need to deal with the problem at source. So, the ICA continues to fine-tune its policies and procedures to deter the entry of visitors who come for vice activities without affecting the entry of bona-fide visitors.

Apart from having the appropriate visa requirements and sustained enforcement actions, we will extend the use of CCTVs to parts of Geylang from next month. This will help to enhance the sense of public safety and security for residents and businesses, and to deter public soliciting in that area. In addition, police is also engaging the community in projects under the Community Safety and Security Programme (CSSP). One such project - the Joo Chiat Road Community Watch

Similarly, in Orchard Road - a subject which I think Ms Indranee was concerned about because she is the MP there - police has also been working with the relevant stakeholders, such as shop tenants and residents, as well as commercial partners like hotels, shopping centres and office buildings, to address a host of issues, including traffic congestion, noise pollution and vice activities. The police is looking into developing this initiative into a Community Safety and Security Programme to complement and enhance its efforts in managing the vice situation in the Orchard Road area.

The police and the Ministry will continue to monitor the level of vice activities in Singapore to ensure that it does not get out of hand.

On the drug situation, which Ms Indranee Rajah asked, I am pleased to inform her and the House that the drug situation remains well under control, with a sustained and significant decline in the number of drug abusers arrested in 2004. The number of drug abusers arrested last year decreased very sharply by 47% from 1,809 in 2003 to 955 last year. The number of new abusers fell by 17% from

Synthetic drug abusers continued to form the majority of the drug abusers arrested, at 56%, while heroin abusers formed only 12%. This is a sharp drop compared to recent years, in particular in the mid-1990s to 1997, 1998, 1999, when heroin abusers formed the majority of the drug abusers. This is the second year since synthetic drug abusers have displaced heroin as the main drug of abuse in Singapore. But before we become unduly alarmed by this, let me assure this House that, in absolute terms, the number of synthetic drug abusers also fell by 46% from 980 in 2003 to 532 last year. The number of heroin drug abusers fell by an even larger percentage of 80% from 567 in 2003 to only 111 last year. So, you can see that, over the years, we have been keeping the drug situation under control, and the number of drug abusers, whether it is heroin or synthetic drug abusers, has declined quite considerably.

What is the cause of this? I think one of the reasons could be the comprehensive and multi-pronged approach consisting of pro-active preventive drug education, rehabilitation, strict laws and rigorous enforcement to deal with the drug problem and to combat the perception that synthetic drugs are harmless and cool.

In the area of preventive drug education, the Central Narcotics Bureau has already stepped up efforts to highlight the dangers of synthetic drug abuse through talks and distribution of audio-visual materials in schools. In addition, the National Council Against Drug Abuse has conducted the "Clubs Against Drugs" campaign since 2000 to enlist club operators to disseminate anti-drug

Another important prong of our strategy is the rehabilitation of synthetic drug abusers. Currently, these abusers are sent to prisons, because they are charged in court and they do not benefit from the focused treatment regime that opiate heroin drug abusers undergo at the Drug Rehabilitation Centres (DRCs). The imprisonment option was adopted because little was known about the nature of synthetic drug addiction in the 1990s. The Singapore Prison Service will soon be launching a DRC treatment regime for the first and second time synthetic drug abusers. This is a change. While a rehabilitative approach is taken for first and second time synthetic drug abusers, there is also a need to deter and punish recalcitrant abusers from persisting in their drug habit.

Currently, for third and subsequent time heroin abusers who do not change after two admissions into the DRC, they will be charged in court if they are arrested for the third time or more and, if they are convicted, they will be sentenced to the Long Term Imprisonment regime. Under this Long Term Imprisonment regime, the abusers will be sent to prison for five to 13 years and given three to 12 strokes of the cane. This has proven to be very effective in changing the habits of heroin abusers.

Therefore, when the DRC regime is introduced for synthetic drug abusers, we will consider placing them on the Long Term Imprisonment regime, if they fail to change after two DRC admissions and are caught the third time for synthetic drug abuse. Essentially, this new approach for synthetic drug abusers will dovetail with the current approach for heroin abusers which has worked very well. Further details on this will be released in due course by the Prisons Department.

Ms Indranee also mentioned that we have young professionals and others who go to work or party in neighbouring countries and they may consume synthetic drugs. I do not think they can avoid detection at our checkpoints because, some years ago, the law was amended such that if a person is detected to have taken drugs when he is overseas, he will also be subject to the same laws in Singapore. We have had cases of Singaporeans or permanent residents who took drugs overseas and, when they were detected at the checkpoint, they were dealt with according to our laws. So, my advice is, it does not matter where a person takes the drugs, so long as he is detected in Singapore, he will be subject to the law.

Coupled with strict laws and vigorous enforcement, we are confident that this multi-pronged strategy will continue to help us ensure that the drug situation in Singapore will remain well under control.

Let me now turn to Dr Mohd Maliki's question about the Community Safety and Security Programme. He asked how can community groups be involved to take ownership of the CSSP and what other things can we do.

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Sir, our experience shows that Singaporeans are taking part very actively in the Community Safety and Security Programme. Since the introduction of the CSSP in

basis. Member countries are also able to access the various databases and information contained within the I-24/7 database.crime. Therefore, in addition to tackling the domestic crime situation, the Home Team also places great emphasis on building networks and good relations with our foreign counterparts. Group - was recently launched by Mr Chan Soo Sen. The Joo Chiat Road Community Watch Group is an initiative of the Joo Chiat Citizens' Consultative Committee with support of the Singapore Police Force, National Environment Agency, Land Transport Authority and Urban Redevelopment Authority. The Watch Group aims to provide a focused and coordinated approach to address community related issues, which include the congregation of foreign women in public areas, noise pollution from pubs and illegal parking. Feedback from the residents has been very encouraging, and anecdotal evidence suggests that the situation in Joo Chiat Road is now much improved. 730 in 2003 to 604 last year, an average of 50 new drug abusers were arrested last year every month.messages to their patrons. The National Council Against Drug Abuse also conducted a media campaign against ketamine abuse last year.

1997, over 3,900 CSSP projects have been implemented to tackle the safety and security concerns such as crime and fire prevention, and emergency preparedness. In 2004, more than 700 CSSPs were implemented in more than 600 Residents' Committees (RCs) and their Neighbourhood Committees (NCs). While these numbers show the success in engaging the community at large, the effectiveness of each CSSP must be

For instance, there was a spate of motor vehicle thefts at Bukit Merah Lane from February to June 2004. The residents of Bukit Merah Lane and the Bukit Merah West Neighbourhood Police Centre (NPC) came together and set up a CSSP. They also got the Housing and Development Board (HDB), Bukit Merah Town Council and National Parks Board (NParks) involved and implemented several crime prevention measures, including joint patrols, raising awareness among motor vehicle owners in the area and installing brighter lights at the identified car park and the neighbourhood park locations. As a result, no motor vehicle theft was further reported in that neighbourhood.

More recently, the Hotwheels Patrol Team, which is the CSSP from the Jurong Central Civil Defence Executive Committee (CDEC), discovered some discarded items on fire at a void deck in Jurong West and successfully put out the fire using fire extinguishers. These are just some examples of the many CSSPs which exemplify the community's vigilance and preparedness in taking ownership of their own safety and security.

Other than CSSP, the public can also actively take part in the various activities that deal with security and safety issues. There is the Neighbourhood Watch Zone (NWZ) Scheme which involves the public taking ownership of community safety. Residents will sign up as NWZ volunteers. They will work closely with the Police to identify and address the local safety problems. Singaporeans can also enhance their emergency preparedness skills by joining the Community Emergency Response Teams (CERTs) so that they can help their neighbours in the event of an emergency.

There is also the Emergency Preparedness Groups (EPGs) initiated by the

The framework for the community to look after its own safety through self-help and mutual support is therefore already in place.

measured on its own merits. Obviously, some are more successful than others. People's Association to lead and coordinate the emergency preparedness activities of the various grassroots organisations and to prepare our residents to deal with emergencies such as disease outbreak, water shortages, a huge fire or even a bomb blast.

Mr Wong, just to alert you, you are eating into the allotted time for the rest of the reply.

Yes. I am finishing soon, Sir. Let me now come to Mr Steve Chia's point about the bird flu problem. Certainly, we are all very concerned about the bird flu problem. Let me assure him that the Home Team is prepared to deal with this together with the other Ministries because, under the Home Team, we have a crisis management structure and this crisis management structure includes the challenges that we may face, like the bird flu crisis or a flu pandemic. Let me assure Mr Chia that the Government has taken steps to stockpile some anti-virals in case there is a need for anti-viral drugs. As the flu vaccine for the H5N1 has not been developed yet, we are taking a keen watch on this and see what others do.

On Dr Wang Kai Yuen's question on Internet Service Providers, let me assure him that the Police does not just barge into anyone's office to take away files, servers or whatever equipment that are necessary for its investigation. Firstly, the Police would do its job according to the law. Under section 58 of the Criminal Procedure Code, Police has powers to require a business operator to produce documents or, in the case of an Internet Service Provider, to provide the ISP logs

Let me assure him that ISPs are not the only parties required to produce evidence that is required for investigations. There are all kinds of cases which Police investigates from time to time which require businessmen' cooperation, and I hope they will continue to do so.

I think I have covered most of the issues.

for investigation when they are investigating a crime. It will not make it more onerous than any other kind of investigation for businesses. There is no brute force approach used in this and the Police has its own team of computer forensic investigators to look for data in the logs if there is a need to do so. Indeed, the Police has done so in some cases. In other cases, perhaps because the owners are not cooperative, the Police may have to use a section of the law to compel the provision of that particular log.

Mr Charles Chong. You have got two minutes for two cuts.

Penal Code

Sir it is on record that the Penal Code has been called my favourite topic. While I do not profess to play favourites, I shall, for the sake of continuity, ask the Minister if he would let us know when the long promised review of the Penal Code will be completed. The law must have certainty. If an offence is on our books, the Police and the authorities have a responsibility to enforce it no matter how silly or ridiculous it may appear to us today.

Prosecutorial discretion aside, they have no mandate to ignore provisions of our law and they cannot do so until the law is amended and the outdated provisions expunged from our books. We must realise that this issue is one which is more fundamental than has been acknowledged.

Sir, it is my fervent hope, and I am sure it is now also the fervent hope of the Minister, that I will not have to raise this issue again at next year's COS.

Warrants of Arrest

Sir, would the Minister tell us what is the average number of warrants of arrest issued by the courts each year? What is the backlog in the number of warrants yet to be executed by the Warrants Enforcement Unit? Could the Minister also tell us what measures his Ministry intends to take to clear the backlog and perhaps also reduce the necessity for new warrants being added to the backlog?

Criminal Records

Sir, this is probably the third or fourth time that I am filing this amendment on MHA. Just like Mr Charles Chong, I am very noted for this.

Sir, since PM Lee took office, his constant message of making Singapore a land of opportunity has been very much welcomed by Singaporeans. Indeed, the current Budget policy of the Government for this financial year is premised on the theme - opportunity and community. Sir, I believe that we must create opportunities for Singaporeans to contribute to Singapore and enhance their sense of belonging and ownership to the country.

Sir, as a professionally-trained social worker, I believe that everyone has the potential for change. Ex-criminals too have the potential for change. Yes, they must pay for their crimes and have their freedom taken away from them by incarcerating them. Yes, there will be those who are recalcitrant and they return to their bad habits. Yes, society must be protected and thus, we need to detain or keep these criminals in prison. But, Sir,

The Yellow Ribbon movement is an excellent beginning to help ease the return of ex-criminals into mainstream society. We can do more. Sir, many Members of the House have repeatedly asked the Ministry to consider innovative ways of helping these ex-criminals. As it stands now, once you have a criminal record against you, your record stays for life. Employment opportunities shrink significantly when potential employers are informed of your criminal records as many employers ask the job applicant to declare if he has a criminal record. Some even ask the applicant if he has ever been charged in a court of law, never mind the outcome of the case.

Sir, the Minister has, on previous occasions, assured the House that the Ministry is reviewing its policy on criminal records, possibly considering expunging their records of minor offences or considering the records as spent if the ex-criminals show sincere desire to turn over a new leaf by being crime-free for a certain period of time. Sir, I have been waiting for that day to come.

I know many lives will be changed forever if our Government takes this bold step forward. I hope to hear that a decision has been made and not that it is still under review. Indeed, we must continue to be innovative as we continue to create opportunities for Singaporeans, in this case, those who may have made a mistake in their lives and are sincerely trying to make amends.

Sir, the Yellow Ribbon movement encourages us to unlock the second

after having been incarcerated, after having taken their freedom away from them, many do, in all honesty, leave the gates of the prison with the hope of rebuilding their lives. Unfortunately, they enter their second prison - the societal negative perceptions especially with regard to employment. prison for these Singaporeans. Perhaps, the Government can lead the way by instituting the policy of expunging the records of those who are genuine and sincere, albeit the necessary criteria being met.

Ex-drug Abusers

Sir, as the Minister had told the House just now, the number of local drug abusers arrested in 2004 has fallen about 47% from the previous year. More importantly, the number of new drug abusers arrested has also fallen. I join Mr Ahmad Khalis in commending the Home Team, and particularly CNB, for a job well-done and encourage them as they continue to wage battle on drug abuse.

Sir, the other heartening news is that there are abusers and former addicts who want to reform and are trying their best. They are aware of the pain and the hardship that they have inflicted on their families. Many MPs in this House will tell you, when they have met these people at their MPS, that they are indeed sincere and want to change.

Sir, aside from the vocational skills and raising their employment chances later, work is a major contributor to the rehabilitative process and it also brings the family the much needed income that was absent when the person was in DRC.

During the MPS, MPs like myself would have heard this story. I ask them, "Mister, why did you lose your job again? This is the fourth or fifth time we are referring you to the CDC." He would say, "Sir, what do I do? If I tell the employer I am a former abuser, I may not get employed. If I do not tell them, at least I have half a chance of being employed." But then, after a week, when they need to go for the urine test, what excuse do

Sir, I do understand that the recently released abusers are in the high-risk group and that their relapse is high and they need to go for their urine test. But perhaps MHA and SCORE can consider working together individually with these persons, consider the ones that are recently released, those who have somehow secured a job upon their release, and the urine test schedules may impact on their continued employment.

Sir, I am aware that the Yellow Ribbon programme has met with some success and I believe that my suggestion will aid some of these ex-drug abusers in holding on to their jobs for an appreciable time in order that they can make a positive contribution to their families and, in turn, give themselves the confidence that they are also successful in their own fight with drug abuse.

they give? Take an MC - how many MCs can they take? Emergency leave - how many emergency leave and excuses can they give? So after a while, the patience wears in and the employer tells him to go.

Traffic Police and Road Safety

Sir, over the years, our Traffic Police has done a commendable job in keeping our roads safe for all road users. And of late, I notice that they have stepped up enforcement action against people who speed on our roads. In general, I think this is the right thing to do because those who speed on the roads are a hazard to other road users, as speeding results in serious injuries and even death to innocent people.

Over the past few weeks, there was a lot of unease among Singaporeans over what I would call the "guerilla tactics" used by the Traffic Police in enforcing the speed limits on our roads. By this, I refer to, what I would say, the rather "sneaky" way the Traffic Police was concealing

But, Sir, I am glad to note that a few days ago, the Traffic Police has changed their tactics and come out in the open and announced where these speed detecting devices are located and motorists are therefore now aware of where they are when approaching these points on the roads. For the Traffic Police to do this, I would say that this is again very commendable. This is the right approach. If the Traffic Police seriously wants to curb speeding, it should let motorists know where the speed traps are. It is better to make people drive within the speed limits than try to trap them and catch them.

themselves and aiming the radar or laser guns at motorists from overhead bridges or viaducts, hiding themselves and doing this.

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In fact, I myself realise that of late motorists appear to be driving within speed limits because they are aware that "Big Brother" is now visible and watching. So, by being more open and alerting motorists to where they have stationed themselves, the Traffic Police is, in fact, helping to improve the situation. If you do not believe that this works, just notice for yourself how quickly motorists and motorcyclists slow down the moment they spot a traffic cop or police car. But, Sir, in enforcing the speed limits, the Traffic Police must also exercise some leeway.

There was the case of the poor motorist who was issued three traffic summonses and received 24 demerit points on the same stretch of road one morning. As I understand it, this poor motorist had no inkling that the speed limit on the 4-lane carriageway could be only 50 kph and so he just drove a bit faster.

In recent weeks too, I had some constituents coming to me with traffic

It is, of course, easy to say that if there are no speed limits it means the limit is 50 kph. But, it is better to have the signs visible for all to see. In fact, just the other day, I was driving down the AYE at 90 kph and suddenly the speed limit sign changed to 50 kph and this is on a 4- or 5-lane expressway. I think somebody also wrote about this to the press. I had the same experience and so I had to brake quite suddenly, cut the speed by half, which means I could have caused a sudden accident if the driver behind was not paying attention, or I could slow down at my own pace, but then I risk being caught by one of the cameras of the Traffic Police.

While still on the subject of speeding, I would like to ask if the Traffic Police intends to take any action against the

Working on the premise that the Traffic Police now understands that prevention is better than cure, I suggest that the Traffic Police also use this approach when dealing with the problem of drink driving which, as we all know, is very serious. I think that drink driving will drop dramatically if police show their faces around the carparks at our popular night spots. It might be a good idea if they conduct this breathalyser test before the drivers drive off. Maybe they could even set up a booth and table and charge them for the test. So the Traffic Police would not be booking drunken motorists but then they are actually preventing serious accidents from happening. So why waste resources trapping motorists at road blocks if our foremost objective is to prevent accidents from happening? I urge the Traffic Police to adopt this philosophy: better to prevent, than to punish. By making its presence visible on the roads and by adopting a friendly approach, the Traffic Police might be surprised how far it could gain the support of the community in its work.

summonses. They drove with a speed variation of around perhaps only 10 kph above the speed limit and, in most cases, they had no idea what the speed limits were. So, in its zeal to enforce the law, the Traffic Police must not go for the overkill and penalise many motorists whom I believe, for want of a better word, are not really speedsters. Many of these motorists are ordinary workers, delivery clerks, taxi drivers, etc, and their livelihood has been affected because they receive a lot of demerit points in a short while. I think here we have to make a fine distinction between those who speed intentionally and those who happen to drive at a fast speed momentarily. Sir, today's car engines are so powerful. Sometimes, you just press the pedal a bit, zoom you go above 50 kph and, if the camera is there, you get caught. You are not actually speeding, Sir. In many instances, in fact, if you do not drive too fast you are probably in danger of hogging the road, and that, in itself, is a hazard. I, therefore, urge the Traffic Police to review the speed limits along our roads and put up speed limit signs on all roads.people who hold car races in the middle of the night, particularly on weekends. I raised this before. The press still reports on it, but I think these are the real speedsters that the police should be catching.

Sir, like the Member before me, during the last few weeks, I have had a significant increase in the number of my constituents coming to see me in connection with speeding offences. I believe that this is a direct result of the Traffic Police using the newly acquired speed cameras which were, until recently, stealthily deployed. Like Mr Tan Soo Khoon, I applaud the move by the Traffic Police to make the cameras and the enforcement officers more visible. However, I feel a little more could still be done. For example, there is hardly any use

Sir, a related point is that the Traffic Police or the Land Transport Authority, whichever authority that is in charge of speed limits, should consider if the 50 kph speed limit on the majority of our roads is feasible or realistic. Public perception is that the Traffic Police gives some leeway where speeding offences are concerned. However, this simply adds on to the uncertainty as to how much over the limit one can go. Could the Minister consider raising the speed limits to a safely acceptable level and then employ a zero-accident policy towards enforcement? There would then be at least some sense of certainty and motorists would not have an excuse if this policy were to be applied across-the-board.

Sir, motorists are not the only road users. More vulnerable road users such as motorcyclists, cyclists and pedestrians, especially the elderly and children, also use the roads. Could the Minister tell us what road safety measures and safety messages are being conveyed to these more vulnerable road users?

in telling the public that the speed cameras may be deployed on the PIE. Sir, I believe the PIE may be the longest uninterrupted stretch of road in Singapore. The Traffic Police, if it wants to be more visible, needs to be more specific with information on deployment locations.

Speed Limit

(Hong Kah) (In Mandarin): Currently, the speed limit for our main roads is 50 km/h. This regulation was laid down in 1948, when Singapore was a third world country with poor road conditions and there were more older cars. Thus, it was reasonable. After 50 years, with our rapid development, we are a developed nation, our roads are wider, the COE system has resulted in more newer cars on the road, with more advanced technology and are hence more responsive and capable of higher speeds.

Let us take our neighbouring countries for example. Malaysia's speed limit is 60 km/h, China's and Indonesia's are 70 km/h, Thailand's is 60 km/h within the city and 80 km/h outside the city, Japan's is 85 km/h and the Philippines has no speed limit. In comparison, our speed limit is lower. Time is money. To help our citizens maximise their time, I hope that the Minister will consider to increase the car speed limit for our main roads from the current 50 km/h to 70 km/h. As for accident-prone areas and roads within residential estates, it should be maintained at 50 km/h.

Recently, the newspapers have reported that the Traffic Police have been recording speedsters using cameras on overhead bridges. Some taxi drivers have given me feedback that this situation has caused them much distress when they approached overhead bridges. They had to keep looking up while driving to see if there were traffic police officers standing there, taping them. Such distraction is dangerous for drivers. Hence, I hope that the Traffic Police will change their location and tape from other places, not from overhead bridges.

Therefore, I suggest that the Ministry of Home Affairs consider allowing an increase in the speed limits on our main roads.

Mr Chairman and Members in this House who drive would have horror stories to share about terrible drivers that they meet on the road - perhaps those who do not signal, drivers who leave their signals on, only to turn in the opposite direction, and many more. Mr Tan had covered the speeding drivers. I would like to talk about the other drivers.

I have been told by a taxi driver why many Singapore drivers do not indicate or signal when they want to change lanes. He said that because whenever they

I was in a taxi coming back from the airport and the taxi driver said, "Mister, Mister, the Mercedes car in front is cheaper than the Mercedes on the inside lane." I was curious and I said, "Oh, yes, maybe it is the engine capacity." He said, "No, Sir. This is a special car." I said, "Why?" "This car comes with less options - rear view mirror and signal lights not included." I said, "Oh, I see. I know what you mean now. So, sometimes our drivers on the road act as if they have no rear mirror in their cars. It would not be very much to glance at the rear view mirror, see a car behind you and make way." He said, "I do not know. Maybe it is one-upmanship just to stay in the front."

While I do not think that such drivers are kiasu drivers, I think it is more of the "I don't care" kind of drivers. I would have used another word that starts with "Bo", but I do not think it is parliamentary language. I think the manners of these drivers need to be improved. Maybe they need to be re-educated. The problem is compounded by the behaviour of other road users in situations like those who slow down to prevent others from passing by jamming their brakes, and others who tailgate - all recipe for a pile-up on the highway.

The problem is magnified when the driver goes on his or her happy way, ignorant of the others on the road, or perhaps in some cases, they do not care about the other road users, including the pedestrians, the speeding motorbikes between two moving cars. So these "kings" and "queens" on the road that do not care, raise the overall stress and danger on our roads.

Another pet peeve I have is how Singaporean drivers do not seem to know how to react or do the right thing when there is an emergency vehicle behind, either a police car or an ambulance. They said, "It is not urgent. He is just flashing his lights. If it is very urgent he would turn on the siren. If the car in front is moving at that speed and I am moving at the same speed, I am paving the way." Strange!

Sir, I watched with horror also, sometimes in a moving vehicle, with smiling young parents - the wife in the car chit-chatting, pointing here and there, all belted up, in case they get caught and fined. But, guess what? They have a toddler standing in front at the front seat and talking to the child. I guess these people have a strange sense about safety because when the air-bag comes on, they do not only have the air-bag to save them, but the child in front would also absorb some of the impact.

Similarly with maids carrying children at the back seat of the car. It is a strange but common phenomenon in Singapore. The maid is well belted up, the father is belted up as a driver, the mother is belted up, and the maid carrying the baby. Again, it is a recipe for disaster. Maybe this is very strange to look at, but the child is going to be very badly hurt.

signal their intention to change lanes, the other drivers would speed up to prevent them from cutting into their lane, not filtering into their lane. Hence, rather than signalling their intention earlier, Singaporean drivers have been conditioned to just cut left or right.

Bicycle Safety

I would like to declare my interest as the Patron of the Singapore Amateur Cycling Association.

Recently, I held a discussion with concerned cyclists who formed a Safe Cycling Taskforce after fellow cyclist Sylvester Ang was killed by a bus in December. Sir, his death is another painful reminder that our roads are just too

Sir, we need to be realistic. No matter how much enforcement or education is done, it is hard to make our roads safer for cyclists if our urban planners or transport policy-makers do not factor cyclists into their plans. Recognising this, several countries such as Australia have formed multi-agency committees on bicycle issues.

Sir, there are currently many heartlanders using bicycles as a mode of transport from their home to school, market, MRT stations, etc. Many use the footpaths along the public road to commute responsibly as they felt that the roads are presently too dangerous, especially for students cycling to school. However, it is now an offence to cycle along a footway. Could this rule be reviewed, while making sure that the safety of the pedestrians is not compromised? Perhaps modifications could also be made to some footways, with clear signs for pedestrians and cyclists so that both could use the footway safely. This would require coordinated action, but the blanket ban signals that cyclists have no business being on footways, even though the roads might be dangerous.

I would also like to ask the Ministry to do more to promote safe cycling and to put aside a budget for it. It should mount a campaign, the way it mounts a campaign for motorcycle safety and road safety for motorcyclists. I would also like to ask the Ministry whether there has

dangerous for cyclists. We need to take a serious view of the vulnerability of this group of road users, especially as their numbers are increasing. But because it is an issue that cuts across several different Ministries, and requires coordinated action, it seems to fall between the cracks, with no real progress. I would urge the Ministry to take the lead to set up an inter-ministerial taskforce to look into the issue of bicycle safety, before more lives are lost.been any enforcement action taken against motorists ---

Ms Ng, your time is up. Prof. Ho.

Sir, let me cover the Members' cuts in parts.

The first part is with respect to reviews that are being carried out by MHA, in particular the review of the Penal Code and on amending the Registration of Criminals Act to allow records to be spent. Indeed, these are big exercises that we have undertaken for several years because the ambit is a very large one, particularly the Penal Code review. I am glad to report to both Mr Charles Chong and Dr Maliki that we are seeing the light at the end of the tunnel. In the next 2-3 months, we will be able to take steps to amend the Acts, in one instance, the Registration of Criminals Act, and the other the Penal Code. Because it is a big exercise and it impacts all Singaporeans, on the Penal Code amendments we will be consulting the Law Society of Singapore when the Bill is ready. And, indeed, we will also be putting up the Bill when ready for public feedback and views.

Sir, moving on to the topic of warrants of arrest, this is something which the Government is mindful of. The number of warrants which are outstanding stood at about 63,000 in January this year and about 40,000 warrants of arrest are issued annually. But, having said this, we should see this in perspective because it does not mean that there are 63,000 Singaporeans who have warrants against them. In fact, some of them have more than one warrant. Many of these warrants are because people have not paid composition fines. And, even though they were given many opportunities to pay these fines, they did not, and were asked to go to court. When they do not go to

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So what have we done about it? We have looked at it both in terms of the process and at source.

court, warrants of arrest are issued against them. So the first point to make really is that Singaporeans should take the payment of composition fines and going to court seriously, otherwise, they are in contempt of court.

What can we do to address the problem holistically and systemically?

In 1999, the Government formed a committee, which I chaired, to look at the process to see how we can make it such that there will be more opportunities to pay at machines and other places, in terms of timing, before a court summons is issued, and also the notice of composition should be made clearer on the form. These are processes which we looked at to ensure that people who have summonses issued against them will know that they have to pay composition fines and there are many opportunities to do so. If not, what is waiting at the end of it is possibly a court attendance. This is to bring it to their attention.

More holistically, of course, the Government has, through Ministry of Law and the Attorney-General's Chambers, started what we call a decriminalisation exercise. We have been working with the various Ministries to see whether some of the minor regulatory offences can be decriminalised. Instead of starting on the court process, we give them an opportunity to pay a composition fine, particularly if the offences are minor and regulatory. I am happy, for example, that certain Acts have provisions of powers of composition put into them, when we amended, for example, the Computer Misuse Act and the Urban Redevelopment Authority Act. We also put in this general power to offer composition in the Criminal Procedure

Sir, I have recently reactivated the committee. It is an inter-Ministry committee - HDB, ACRA, URA, LTA - and we will continue to look at how we can streamline the process, give Singaporeans more opportunities to pay and, also at the same time, at source, to see which offences we can decriminalise. Taking this approach, I think the number of warrants should come down in due course. Of course, we will also look at whether there are other ways of imposing some penalty, not necessarily through the court process. There are alternatives like administrative sanctions and civil penalties which we can also look at. One other point is whether or not Police should be the agency to enforce warrants. Because if other agencies own this process, I think they will have a bigger stake to get the warrants enforced.

The third area is on road safety which many Members have spoken about. I am happy to hear Members say that because of recent police enforcement, Singaporeans' driving behaviour has become better. But we all know that Singaporeans' driving behaviour should not just be influenced by whether or not there is enforcement. I think it is something that we all need to internalise and that is where education, which Mr Fong talked about, is important. And Traffic Police has a platform, with partners in the private sector, to mount that.

As for the recent publicity on speed enforcement, Traffic Police Commander , Ms Ng Guat Ting, already had an extensive press interview, explaining why Traffic Police was doing it, and also dispelling some of the points which had been raised by Singaporeans, for example,

As to whether the speed limit of 50 kph for town roads should be amended, Mr Ang Mong Seng cites certain cities like Bangkok and Jakarta. These are cities which we do not want to emulate. There are cities like Stockholm, London, Berlin, urban cities which have good track records, whose urban speed limits are 50 kph and below. For the roads in the

Certainly, Traffic Police will carry out a comprehensive review of speeds in all other roads - this is being done - including those roads mentioned by various Members, to see whether they can safely support higher speed limits, and they will do it more regularly. So a big exercise is ongoing. We should have 40 more roads with the speed limits raised by the end of this year. And going forward, instead of a three-monthly cycle of review with LTA, they will do it monthly. Because I also hear feedback from Members that when roads are upgraded, because the time lag is too long, it should be 60-70 kph, instead of 50 kph. Now the upgrading will take place faster, because the review will be done faster. Having said that, I must add that just because roads are not listed to be the ones which are being observed by Traffic Police, there will be no enforcement. Enforcement must be ongoing.

The next cut is on cyclists. I thank Ms Ng for raising this point. It is a point which she feels passionately about. Mr Ong Kian Min and others also feel passionately about it. It is something which we should look at, because many Singaporeans do cycle for various reasons, including recreational, and some cycle to MRT stations.

What we will do is that we will review some of these matters including, for example, whether or not we should allow cycling on pavements or footpaths, not without conditions because it is shared space with pedestrians. However, we can be mindful that in certain circumstances, perhaps it can be allowed. Currently, the rule is quite strict, you cannot cycle on pavements.

Ms Ng talks about the formation of a taskforce. We will look at whether or not there is a need for a full-fledged taskforce as part of this review. She also talks about having a Bike Wise Week. These are matters which the Traffic Police is looking at. I can assure her that in our review, we will consider feedback from her and others, because she is the President of an association for cycling, and we will see how we can accommodate that, bearing in mind, of course, that Singapore roads are for many road users. And this is the point that I must make even as we want to look at the interests of certain groups. There are also other vulnerable road users that we have to be mindful about and, certainly, cycling on footpaths may impact negatively on the safety of pedestrians.

Mr Arthur Fong talks about driver education. I think that is the point he wants to make. This is, again, ongoing, because the other platform that the Traffic Police spends a lot of time on is really driver education, and it is working with private sector partners on this. Over the years, we have launched campaigns, road safety talks, exhibitions and even videos. For example, on cycling, a video was launched, recently last year, featuring Mr Chan Soo Sen on a bicycle, which is now being distributed and shown in community centres. He is an MP who cycles around to visit residents. So he knows all about cycling.

There is also a Traffic Police website which is linked to the SPF website. Mr Fong's point is on continuing driver education - how can a person quickly have access to some means to improve his own driving behaviour? In fact, there is a website, just launched last year, where a person can easily test himself and he can see whether he is a good or bad driver.

Other points have been raised on road safety, whether we should, for example,

It is the same with drink driving. Mr Tan also mentions drink driving. This is another area where Traffic Police has also raised the level of enhancement. His point is whether the Traffic Police should mount operations before they drive off. I think a better solution is to work with night spot operators, and this has been ongoing. I understand that some pub operators actually have this device outside their pubs. It is a good thing because it is a win-win outcome. The patrons are encouraged to test themselves. In fact, they also facilitate the patrons by calling for a taxi and other means of transport should they exceed the limit.

Sir, I have covered most of the points. On urine testing, it is something which is very needful because after coming out from a DRC, a person is put through two years of supervision. But he gets urine tested only for one year, which is already an improvement. Formerly, it was two years but, after reviewing it, now we have put it as one year. Also, the CNB is flexible in accommodating requests for change of times. Currently, there are three times - Mondays, Wednesdays and Fridays, in the morning, afternoon and night time. Actually, they have a choice of what time they want to go to. If their work, for example, constraints them from coming at a certain time, they can actually go for another time on the same day.

Code (CPC) Act last year. Hanging on the CPC provision, other Acts have had the opportunity of some of their offences being made compoundable - the Moneylenders Act, the Medical Registration Act. whether the Traffic Police was sneaky, whether they were doing it to collect fines, and whether or not they were over-zealous. I think her assurances have been publicised in the media. But let me also reaffirm in this House that Traffic Police does it transparently and fairly. And, indeed, hearing feedback from the ground, there are some steps that have been introduced which will assure Singaporeans that the object of the exercise is to help them to become good drivers. For example, listing of the locations on the website is one of them, and also the assurance that when Traffic Police personnel do the enforcement, they wear white uniforms and they will be at places which are safe. For example, Mr Ang Mong Seng talks about they being on the pedestrian overhead bridge, which is a safe place. It is not because they want to trap motorists, but it is away from the traffic. I hope these assurances will go down well with Singaporeans, and everybody rallies around and sees the object of the exercise, which is to save lives. In fact, vulnerable people, which Mr Charles Chong talked about, like motorcyclists, pedestrians, like children and the elderly, are the ones who may be impacted if motorists drive excessively over the speed limit. Indeed, this is the thrust of Traffic Police's enforcement actions, not just about those who drive above the speed limit. Because in a three-month period, between October and December last year, 60% of the summonses were issued with regard to people who had exceeded the speed limit by 30 kph or more. Let us see this in perspective.residential areas and industrial estates, we should be careful about raising the speed limit from the current 50 kph, because this is where Singaporeans live and work, and I am sure their sense of safety will be impacted if we do that. target car races. That is a good point. In fact, Traffic Police has been targeting people who race at night, whether it is Orchard Road, Shenton Way or other places. They call it night operations. More of these have been mounted over the past year. In fact, the media has helped to publicise it when they are caught. And as Mr Tan knows, we moved an amendment in this House to enable the Traffic Police to punish these people who exceed by 40 kph or more, and even visit them with higher punishment.

Your time is up, Prof. Ho.

Sir, a point of clarification on CSSP. While the grassroots organisations may have intention to implement some of the CSSPs, perhaps the Minister is aware that hardware funding is required. RCs and grassroots organisations may raise their own funds but sometimes the hardware cost may exceed their capability to raise the funds. An example would be the CCTVs which are implemented in some precincts in HDB estates. I was wondering whether the Ministry would be prepared to assist the RCs by way of some form of subsidy to facilitate the implementation of that particular CSSP programme which requires assistance.

Sir, as regards CSSP funding for CCTV, this is an issue which was raised previously as well. I have asked the Police to see how we can be more sympathetic, but we have limited funding under the CSSP programme. We leave it to the advisers concerned to decide how to use the money. But if the residents really find the need for CCTV,

I think it is something that they themselves can do because it is not a very expensive equipment. The prices have come down, and they can find a reasonable equipment that can do the job. The town council can also chip in because it makes the estate a bit more safe. Also, the residents will welcome the kind of improvement that the town councils do for their estate. I think all parties can play a role in making the whole estate safer, cleaner, friendlier and more neighbourly.

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Sir, I do not know what this breath test kit looks like, neither do I know how much it costs. Fortunately, I have not been stopped at any road block. So I have no idea what it is like. I

was just wondering, if they do not cost a lot, would it not be possible to sell these kits to motorists? Because not all of us get drunk at nightclubs. Sometimes, we drink at friend's house or we go to private parties. And it may not be a bad idea if motorists are encouraged to keep one in their car. So every time, before you drive off, you take a puff, and you know you are above the limit, you call a taxi. Perhaps, the Traffic Police might want to look into this and make it a project to sell this. They could work with a commercial firm or do it themselves.

So we will have another campaign - own a breath analyser test kit campaign! Seriously, it is something that is worthy of some consideration. I suppose if it is commercially viable, then it will be out there. On the suggestion by Mr Tan, perhaps it is not so much for me or the Traffic Police, but for the commercial world. As Mr Tan has said, there may be a market out there.

I thank the Minister for agreeing to review the rule about cycling along footways. But I want to ask the Minister whether there is a budget put aside for promoting safe cycling as well as enforcement action taken against motorists who are dangerous drivers on the road and endangering the lives of cyclists, especially by squeezing cyclists alongside the roads, as well as action taken against reckless cyclists themselves who may be going against the flow of traffic and other traffic rules that they may have gone against.

I thank Ms Ng for making this clarification which gives me an opportunity now to take points from my speech in a more sane manner. The fact is that Traffic Police does take enforcement action against motorists who endanger the lives of cyclists. The Traffic Police tells me that they take a serious view of this because cyclists are also, as I said in my response

Indeed, the Highway Code actually gives greater emphasis to cyclists' safety. Hence, amongst other categories of users, the Advanced Theory of Driving handbook also emphasises cyclists' safety. Let me just mention what it does. It specifically teaches learner drivers to give plenty of room and be alert when approaching cyclists or passing them; check mirrors and blind spots for cyclists when turning; keep a safe distance between the vehicle and the cyclists when overtaking; and look out for passing cyclists when opening the vehicle door. So all these are there. But as we have mentioned earlier, it is not so much just learning about it when you are at the learning stage. Do I have time?

to Mr Charles Chong, one of the vulnerable groups - motorcyclists, cyclists and pedestrians like children and the elderly. Hence, the Traffic Police does issue summonses to drivers for offences, such as inconsiderate, careless or dangerous driving. I agree totally with Ms Ng that all of us are motorists ourselves and we should also be mindful of this vulnerable group. We do educate them through means like road safety education and, in particular, through exhibitions and other campaigns. In fact, Ms Ng's association is welcomed to work with the Traffic Police to see how we can also reach out to motorists. Of course, cyclists on their part must also not violate any commonsensical requirements, for example, not to cycle against the flow of traffic, or when you cycle at night, to have reflectors. These are all points which cyclists themselves must also bear in mind.

Carry on. Up to 3.20 pm.

But how do we make sure that these messages are internalised? I want to make this as a plea as many of us are passionate about road safety. This is the point that I have been

making at all the functions that I have attended, and I have actually done quite a bit for road safety campaigns. I would say that reminders are important. Without these reminders, road safety in Singapore would be worse off. But having said this, all of us would agree that road safety can be improved, although it has improved. The only way is for us to internalise these messages and in a way realise how our actions may hurt people whom we love. Imagine one day, if we have an accident and we knock somebody down whom we know - our friend, relative or a child of a colleague - I think that will change our road safety behaviour forever.

Sir, the Minister talked about some of the assurances that would be given to the ex-drug abusers from CNB. Could the Minister elaborate on some of the assurances?

What CNB has done is to look at the urine supervision scheme and to see how it can be improved. Over the years, in fact, it has been improved in such a way as to facilitate their reintegration into the society. For example, as I have said, currently, the cycle is over one year. If the ex-drug abuser performs satisfactorily in the first month, the test is every two-day-cycle. After one month, he can report on a weekly urine cycle. And then he is monitored over the next 11 months. Beyond that, if his performance is satisfactory, the supervision order is revoked. This is already an improvement over the previous years. Previously, it was over two years. Currently, they have six reporting centres, spread out over the island. Also, ex-drug abusers can ask for a change of venue, for example, they want to be nearer their workplace or if they shift homes themselves.

SCORE has been mentioned by Mr Fong. Indeed, SCORE does a big part in

trying to place these drug abusers on jobs. Last year, about 700 of them were placed on these jobs. When they are placed by SCORE, a counsellor is also assigned by SCORE to help them so that if they need help with their employers, they can approach the SCORE counsellor who can then be the mediator should there be any problem or dispute as to reporting for these urine tests. This is what we can do. Indeed, we are looking at ways in which the testing can be improved, for example, whether there are better ways to test them, rather than ask them to give urine. Sometimes, the time taken at the police station is also lengthened because they may not have urine to pass. So they have to drink water. The Ministry of Home Affairs is always proactive. We are looking at ways to improve the process. So let us see whether we can expedite the process for them.

Sir, I am happy to hear that the Ministry will review the speed limits on our roads. Will the Minister inform the House probably when we can hear some good news?

Certainly by the end of this year, but probably over the next two or three months. With a quicker cycle of review, for some roads, the speed limits have already been raised. But I think to do a good job, it is better to take a holistic and comprehensive approach, and not do it piecemeal. Actually, the speed limits on roads have been raised for many years now. In 1996, some roads were raised. In 1999, there was another big exercise and, last year, in fact, some of the roads have had their speed limits raised. I think we have to give credit when it is due because over all these years, Traffic Police has been mindful of feedback from Singaporeans on the need for higher speed limits. So they work with LTA.

But, recently, what is good is that the public pays greater attention to speed

limits which have caused the agencies to give greater attention to this topic, and this will supplement what has been done before. For example, last year, the Traffic Police and LTA together raised the speed limits at Upper Serangoon Road, Sengkang East Drive, Punggol East, Bartley Viaduct, Tampines Avenue 10, Telok Blangah Viaduct and Woodlands Avenue 12. Indeed, the speed limits of expressways have also been raised. I do not know whether Members will remember it was 80 kph for a long time and then we raised it to 90 kph about three years ago.

Sir, I might have missed the specific response to my cut. This is to confirm that the Ministry has made a decision to consider criminal records spent or expunged, and that in a couple of months, the Criminal Registration Act will be amended to put that into effect.

Yes, after a long review, we have decided that we will introduce a scheme where criminal records will be considered spent. Of course, as we are making a start, we should be slightly more cautious. Therefore, to qualify for this, basically, they should be offenders of minor offences, for example, simple theft. So if they have been in prison for not more than three months, or a fine not more than $2,000, they will be eligible for consideration after remaining crime-free for about five years. Our estimation is that, with this first exercise, about 90,000 records will be rendered spent. Over the next two or three months, we will be looking at amending the Criminal Registration Act.

Sir, in his reply to terrorism and homeland security, the Minister mentioned that he will put CCTVs at selected places and he also mentioned in passing that his Ministry has developed some capability to automatically detect pre-defined behaviours. Is

that correct? If so, he has also later, in his reply to vice, talked about placing CCTVs in Geylang. Presumably, they have a software that can pre-define human behaviour, it is possible to change the software to detect all sorts of pre-defined human behaviours. So I am wondering whether this placement of CCTVs in Geylang would intrude into the privacy of Singapore citizens.

I think before Dr Wang's imagination go a bit wilder, let me explain this detection capability that we are talking about. It is an experiment that we are doing at the Airport to identify objects that have been placed in a location and which nobody has moved them for some time and, therefore, it will signal to the officer concerned to check what this particular object is about. The Airport is a confined facility and, particularly in the transit area, sometimes things do happen there. It is not that we are going to pry into other people's privacy. That is not the intention. But when there are syndicates exchanging documents, for example, illegal smuggling or human smuggling, that is an area which the Police will have an interest in helping the other countries to deal with the problem of human smuggling.

In the case of Geylang, it is just a plain straightforward CCTV. It is basically to ensure that those who go there do not create problems. It is no different from the kind of cameras we see in Little India, Boat Quay, or Newton. For Singaporeans, they are more concerned about security and safety than privacy. I am not saying that they are not concerned about intrusion into their privacy. But let me assure Singaporeans that the Police will not intrude into their privacy if it has nothing to do with law and order problem.

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Sir, I would like to say that I support the points made by Mr

Charles Chong and Ms Irene Ng on their concerns about safety for cyclists and pedestrians. In some countries, if there is an accident involving a motorist, cyclist or pedestrian, the motorist is considered automatically at fault unless he or she can prove that he or she is innocent. I think

this is a very good practice to promote greater safety for cyclists and pedestrians. May I add that these cities, I believe, are the ones that were mentioned by the Minister as being those with practices that we would like to emulate, eg, France, Germany, Canada, if I am not mistaken, and not the ones which have practices that we do not wish to emulate. Very often ---

3.15 pm

Chairman: Dr Geh Min, are you seeking a clarification or asking a question?

Sir, I am trying to ask a question.

Please ask your question.

Sir, my question is: do we have such a law here and, if not, could we consider adopting it?

Sir, I believe there is a case law in this area. It has already been held that if a motorist hits a pedestrian, even though the motorist may have the right of way, he would still be liable - not fully liable but partly liable, because the pedestrian is vulnerable and, if the motorist takes a little bit more care, he would have noticed the pedestrian. So, it is a matter of degree of negligence which is at work.

Sir, a point of clarification. The Minister mentioned about a committee to review the

warrant of arrest cases. I want to say that he was actually mentioning HDB representatives. I just wanted to request that town council representatives be represented as well, because some of these cases may be due to S&C arrear cases.

An MND representative is there. So, he can look after the interests of the town councils.

Ms Indranee, would you like to withdraw your amendment?

Sir, I would like to thank the Minister and the Senior Minister of State for their replies and, in the light of the responses, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The sum of $1,850,310,090 for Head P ordered to stand part of the Main Estimates.

The sum of $461,509,500 for Head P ordered to stand part of the Development Estimates.

Order. I propose to take the break now.

Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the House.

Order. I suspend the Sitting and will take the Chair again at 3.42 pm.

Sitting accordingly suspended

at 3.22 pm until 3.42 pm.

Sitting resumed at 3.42 pm

Debate in Committee of Supply resumed.

Head W - Ministry of Transport. Mr Ong Kian Min.

Land Transport Strategies

Mr Chairman, I beg to move,

That the total sum to be allocated for Head W of the Estimates be reduced by $100.

Sir, 2004 was a remarkable year for our transport sectors. Passenger traffic at Changi Airport rose to an all-time high of 30.4 million, a 4.7% increase over the previous high in 2002. Changi Airport received 19 best airport awards and accolades from major international publications and organisations. In the maritime sector, due to the brisk growth in global trade led by China, Singapore handled 20.6 million TEUs, a leap of 16% over 2003, and PSA was stretched to work flat out at 105% of its capacity. In the area of land transport, COE prices dropped significantly and public transport operators, SMRT and SBS Transit, reported healthy profits.

I wish to congratulate the Minister and all his staff at the Ministry of Transport and its related agencies for their commendable efforts in building and maintaining our world-class transport systems in air, land and sea. Our transportation systems have gone through the slow years when we were hit by regional competition and SARS, and the years of frenzied activities with high demand and strong traffic. In both situations, the highs and the lows, our transport systems and transport workers have not only withstood the tests but also rose to the challenges and performed remarkably. This was possible due mainly to far-sighted planning, sound policies, prudent management and agility in making adjustments.

It is therefore fitting that Minister Yeo Cheow Tong is a joint winner of the 2004 Minister of the Year award, given by the

Land transport - Sir, I would like to deal with issues relating to land transport first.

Fare review mechanism - among all the transport issues, the most sensitive one would probably be public transport fares. Obviously, nobody likes a fare increase. On the other hand, the operators should not operate at a loss. Otherwise, they would have no money to reinvest in service improvements, and no investor would want to continue putting money in these companies.

Today, fare increases

Centre for Asia Pacific Aviation for the national government minister contributing most to the progress of aviation in the region. We would like to place on parliamentary records our heartiest congratulations to Minister Yeo.

have to be approved by the Public Transport Council (PTC). The PTC has the unenviable task of balancing the affordability of fares with the commercial viability of the operators. While the PTC has been doing a reasonable job in ensuring that fares remain affordable, it is also evident that it is increasingly difficult for them to implement fare increases without attracting a public outcry. It was with this in mind that last year, the Minister for Transport appointed a GPC-led committee to review the fare review mechanism.

My GPC took up the challenge and formed the committee, with members from the academia, the Public Transport Council, the Consumers Association of Singapore (CASE) and NTUC, and conducted a fundamental review of the mechanism. As part of the process, we held focus group discussions with grassroots members and representatives of student unions and CASE. To get a better sense of the alternative models that can be adopted, we consulted transport

One of my key takeaways from the study is that fare review is a subject that is poorly understood by the public. Throughout all the feedback sessions that I attended, the common feedback was that fares keep going up and up. Initially, I had the same impression as well, that fares can only go up regardless of the economic situation. However, after studying the facts, I realise that this is not true and that fares have indeed not gone up in the last two years. In fact, data show that fares had increased only in three of the last seven years.

Hence, I concluded that the impression must have been created partly by the public outcry which followed the last fare increase in 2002 which came after two straight years of fare increases, and amidst deteriorating economic conditions. Yet, this was not entirely PTC's fault because throughout this period, the CPI + X formula had continued to turn out a positive figure. It then became apparent that the formula was not responsive to economic considerations.

It was with this in mind that the Committee decided to recommend that the CPI + X formula be replaced by a more responsive formula, namely, price index -0.3%. The price index aims to reflect the cost pressures faced by the operators. Based on their current cost structure, we propose to set it as 0.5 CPI + 0.5 wage index. Instead of compensating operators for their full cost increases, the Committee feels that a principle of sharing of the productivity gains should be adopted so that commuters also benefit from these gains.

The new formula is more responsive because it takes into account the latest national wage trends, rather than lock in a value of X derived from outdated data. If economic conditions were poor and wages had declined the year before, there is a good chance that the formula will turn out a negative number and this would alert the PTC to consider a price reduction. This is an improvement over the CPI + X formula which has turned out fare caps averaging 2.4% over the last seven years since it was implemented in 1997. In comparison, if the new formula had been applied over the same period, the applicable fare caps would have been lower at an average of 1.9% per year. More importantly, it would have turned out negative numbers in three of the last seven years.

To make sure that the formula remains current, we have also recommended that the price index be reviewed and the productivity sharing of 0.3% be updated after three years.

In addition to the formula, my Committee has also recommended that the PTC takes into consideration the prevailing economic conditions as well as the affordability of the fares to the commuters. This is especially important during times when economic conditions have changed rapidly and significantly, so much so that even the latest available wage figures do not truly reflect the actual feelings on the ground, like in 2002 where the prevailing economic climate was very different from the good times of CPI and wage increases in the previous year. We have recommended a closer tracking of affordability levels rather than rely on the Household Expenditure Survey

In addition, my Committee has recommended that the PTC should also check on Return on Total Assets (ROTA) of the operators to ensure that they are not making excessive profits at the expense of commuters. We feel that these additional checks would serve as useful tools to assist PTC in carrying out its function. This is because, ultimately, PTC still has to decide how much fares should be adjusted within the boundaries of the cap and defend its decision to the public. In this regard, my Committee feels that PTC should be more transparent in explaining its decision process. However, we also feel that this task should not be left to the PTC alone. The operators should also play a more active role in explaining their justifications to the commuters, whether in the areas of operating cost increases, new capital expenditure, service improvements or productivity gains. Only then will the public have an understanding that the fare increase is painful but necessary for the continued provision of a sustainable service.

My Committee believes that our recommendations will help improve the current fare review mechanism and look forward to a favourable response from the Minister for Transport.

Taxi liberalisation - Sir, given the limited time, I would just move on to taxis. Even with the full liberalisation of the taxi industry, commuters are still unhappy with the severe mismatch of supply and demand of taxis during the peak periods, especially wet ones, where it is impossible to catch a taxi from the roadside or even taxi ranks. Taxi-drivers are accused of hiding round the corner, popping up almost instantaneously only when passengers make a call booking. Further, although taxi companies are now free to set their own fares and service

Taxi-drivers, on the other hand, lament that their taxi companies have not reduced rental rates despite the steady decline in taxi-drivers' daily takings over the years. They would like to increase the fares they charge but are fearful that this would drive away passengers, hence resulting in a further decline in income. I would like to ask the Minister whether the objectives of the liberalisation have been met and what his Ministry intends to do to further improve the industry.

experts and academics and studied the models adopted in other countries. The Committee also met with public transport operators to have a better understanding of the challenges and constraints that they face. Based on the operators' average productivity gain of 0.6% over the last seven years, we propose a fixed reduction of 0.3%, as set in the formula. This is to incentivise the operators to continue to strive to be more efficient. data which is available only once in every five years.offerings, there appears to be little or no differentiation among the operators, and the smaller companies are happy to follow the fare structure adopted by Comfort, the largest operator.

Sir, with the liberalisation of the public transport industry, at the moment, there are two public rail and bus operators. I would like to ask the Ministry what is its long-term strategy in terms of public transport provision and what is the relative emphasis between the different modes, namely, buses, rail and even taxis.

The Ministry should perhaps take a leaf from the low cost air carriers to ensure a low cost provision of service as it formulates the long-term strategy on the land public transport. In the last budget, the Ministry has acknowledged that because of the size of commuters in Singapore, direct competition of the rail system does not make sense. Why has it not actively persuaded the operators? Because, in this case itself, economies of scale would ensure that the general public has a lower cost of transport. It is to the public interest that the Ministry should act, similarly as it has liberalised the transport industry when it believed that competition would enhance the land transport service and cost.

It is obvious that, with the two different rail and bus operators, many intervening inefficiency and high transport

We should not look at the cost of transport alone for a train ride or bus ride but the total cost, including the feeder services one has to take and also the cost of time one has to walk. This would ensure a fair and affordable transport cost to the people.

As for accessibility, our buses are still not friendly to the less mobile. Much more can be done for the rail system as well.

costs for the public arise in physical areas, especially in between the two rail systems. The transport company would evaluate the routes on a commercial basis, ie, definitely on profitability. This brings me to the role of the Public Transport Council (PTC) in that matter. Currently, they only review proposals by the operators for new routes and amendments to routes. Should not the PTC independently initiate a study of the whole system in particular areas to see if it is truly efficient and cost-effective?

Sir, during my MPS, I came across an increasing number of parents in Tampines who complained that their children have to spend almost one hour to reach their school in Bedok, thus forcing them to spend almost two hours daily in travelling to and from school. One of them said that his child has to take a feeder bus to the MRT station in Tampines, hop into the MRT train to Bedok before taking another feeder bus to the school. I could not believe that. I thought that with the linking up of the bus and MRT services by the respective operators, commuters have benefited from the through-ticketing offered by the operators. Such benefit should also include shorter travelling time. Alas, I was wrong. I found out how close to the truth the complaint was one day when I decided to take the same bus

The question of efficiency and cheaper feeder services in housing estates has long remained a thorn in the flesh for both the operators and the commuters. On the part of the operators, they are unable to overcome the supply and demand problems. Due to wider areas to be covered and the manner in which the commuters are distributed, the number and frequency of services could not be increased as they are said to be not cost-effective. So the bus operators resort to routing and re-routing the feeder services to meet the other changing demands. But this is acting like what a Malay saying of a person with short sarong: If you pull down your sarong, you expose your top. When you pull it to your top, you expose your bottom!

Sir, at one stage, the construction of the LRT at Bukit Panjang, Punggol and Sengkang had given a glimmer of hope that there would be a better and cheaper alternative to the intra- and inter-housing estate transportation service for the heartlanders. However, the announcement that there is no plan to build a LRT in other housing estates after the two above has brought the question of feeder services back into the forefront.

Sir, we know that in most cases the feeder service by itself is not profitable. We also know that the operators are cross-subsidising the feeder or the LRT services from profit made from the trunk route services and the main MRT lines. The question is: can the operators not do more?

Sir, in the light of this situation, may I ask the Minister whether there are other ways of achieving an efficient integrated public transportation service in these HDB

routes mentioned by them. The problem lies with the poor and slower feeder services. Sir, I am sure this problem is not confined to Tampines area but it is an islandwide problem. towns, especially in the area of feeder services?

My colleagues in the GPC have already pointed out several points that I was going to raise and, therefore, I should be taking less time than I have been reserved for.

First of all, may I just say that if you look at the MRT website, there are four objectives that public transport is regulated to ensure. The first, is that public demands in terms of coverage are met. We have already heard from Mr Yatiman that there are serious problems relating to feeder services and the like. I share his concerns. All MPs I know have this problem, especially in big towns, for example, Woodlands, where there are very difficult problems of navigation in the smaller ring roads, and so on. So feeder services to interchanges have been a problem. To follow that up, we also need to have school children and so on going into MRT trains, taking them to even neighbourhood schools

near Yishun or Marsiling.

4.00 pm

Fares remain affordable is another objective of public transport. We find that in this particular case, we have a few problems to look at. First of all, the deregulation of taxis and the increase in the number of taxi companies, for example, we now have seven taxi companies, and we were hoping that with the deregulation, which was, I think, in 1998, to allow for better fares, differential pricing, better quality services and so on, seems not to have worked out. And, as was pointed out earlier, most of the taxi fares remain more or less the same. The suggestion, therefore, is that is it likely there is a cartel operating among the taxi companies to make sure that the fares do not differ so much so that everybody could have a bigger piece of the cake.

Thirdly, the public transport industry is regulated by MOT to ensure that service is efficient and of a high quality. Sometimes, I am told by passengers that the service is of too high a quality. For example, the installation of TVs in the buses has made people miss their stops, difficulties in thinking what is it that is keeping everybody so engrossed on the TV that they did not want to leave the bus. And, as a result, the people getting off the buses are slower and all sorts of problems come up. Additionally, the bus fares go up.

While I welcome, of course, the GPC's move to regulate public transport fares and to peg it to economic performance, there is a very real perception that a particularly big group of passengers would be adversely affected. These are the structurally unemployed, the persons who have not been able to find jobs so far even though the economy might have improved. I wonder whether the Ministry could look into this problem seriously, with the CDCs, who are the front line for determining what sort of help we could give the unemployed and the chronically unemployed, to see whether we could actually offer them concessionary rates or some way of identifying cheaper cost for them because, even with the improvement of our economic performance, this group is unlikely to be helped.

Finally, we have the objective that the public has a wide range of transport choices. This is true, in the sense that we have more taxi and bus companies now. We also have two companies running MRT trains. But the essential point, Mr Chairman, is that even with all these various additions to the public transport system, somehow passengers still feel that the buses are not coming frequently enough, and taxis are not available especially when you needed

Finally, Sir, I believe that the White Paper on Public Transport to make us have a world-class system was in 1995. In it, the Report said that it would take 10-15 years to come up with a world-class system. I do think that we have moved somewhere along there, but I wonder whether the Minister could update us as to how far we have moved and how far we have to go.

The net result is that the cost of transport in taxis, for example, is not any lower. them. There seems to be integration, but not from the customer's point of view, in the sense that, as Mr Yatiman has already pointed out, people have to change from bus to train to bus again. I wonder whether the Minister could brief us as to how the integration of these land transport services could be improved.

Public Transport Cost

Sir, many Singaporeans today are concerned with the cost of public transport and, in particular, trains and buses. Their concerns are not without reason. Firstly, public transport services are an essential service. More than half of the population relies on public transport to commute. It is a service that we cannot do without. Secondly, transport cost constitutes quite a significant portion of household expenditures. And, thirdly, fuel cost makes up about one-quarter of overall operating cost of public transport companies. With oil prices exceeding $50 a barrel, people's concerns are well-justified. It is, therefore, important for us to manage the public transport cost to ensure it remains affordable and that it does not impose an undue burden on our commuters.

I applaud the move by the Ministry of Transport to review the fare adjustment formula that determines the cap on fare increases. The purpose was to make fare adjustments more responsive to changes

in the economy. However, being more responsive means greater volatility as well. Introducing this formula at this point in time, when the economy is recovering, would mean that we are starting from a low base and there is greater likelihood for the fare cap to go up than to go down. Is this the right time to change the formula? Although the economy is recovering and the unemployment rate falling, the benefits have not fully filtered down to the ground. I think it is not time yet to consider fare increases, especially given that the public transport companies are turning in healthy profits last year. Therefore, I would like to urge the Minister and the Public Transport Council not to allow fare increases this year. I would also like to ask the Minister whether measures have been put in place to manage the fuel cost.

Mr Chairman, Sir, during the debate on the Budget Statement I circulated the survey results of our Feedback Unit's survey on the challenges facing Singaporeans. This survey was conducted scientifically involving in-depth interviews with 1,064 respondents, thereby truly reflecting the population profile of Singapore. There are five issues where there exist a significant gap in public perception of the seriousness of the issue versus the confidence that we as a people would be able to overcome these problems. Sir, keeping public transport affordable is one of these five issues.

72.8% of the respondents consider this a serious matter affecting their lives. On the other hand, only 46.3% of the same respondents consider that we will be able to contain the increase in public transport costs and keep them affordable. Then there exists a gap of close to 26.5%. I would like to find out from the Minister whether he will address this gap in public perception. What contributes to this gap? Mr Ong Kian Min has earlier talked at length about the new transport

fare adjustment formula. Does the Minister think that by adopting this formula we would be able to change the public's perception of keeping public transport cost affordable? If not, what else would he need to do to address this?

Sir, public transport is a very important aspect of a country's growth. As the economy and people of Singapore grow in wealth and in numbers, commuting becomes a very important part of everybody's life. Improvements in public transport vehicles, together with the increase of communication technology, have made travelling a breeze for all. However, the fares commuters are willing to pay for, for using the modern transport system that our country has, still remain as one of the most emotional issues in modern-day Singapore.

Transport fare adjustments have to go hand-in-hand with the affordability of the masses and are cost-sensitive to the public. Under the present system, before any fare adjustments could take place, bus and train operators, such as SMRT and SBS Transit, must first apply to the Public Transport Council for approval. PTC will then review the proposal in the light of the fare review mechanism and deliberate further before making their recommendations to the Ministry of Transport.

The fare review mechanism is, therefore, critical in its decision to set the maximum level that fares are allowed to go up. Currently, the Fare Review Mechanism Committee, which Mr Ong Kian Min has elaborated just now, has made recommendations to the Minister for Transport for a new formula to be used in calculating the level that fares should be set. The proposed formula of price index minus X as compared to the previous one, that is, CPI plus X, is more responsive to economic conditions as the price index takes into account the CPI and prior

On the other side of the coin, we have also to take into consideration improvements made by the transport operators in the level of comfort and reliability of the transport system. This would involve capital enhancement programmes such as improvements to existing buses and trains and the cost of maintaining them. These are costs that have to be recovered by the transport operators in order to remain in business. The question then is how much can the commuters afford for these advancements in public transport. The Fare Review Mechanism Committee has been aware of such matters and so recommended to the Minister for Transport to take these points into account so as to ensure a fair return on assets used by the transport operators. The Committee recommends that the transport operators' ROTA be compared to other industries with similar risk profiles to make sure that the returns on assets are not excessive. Thus, this procedure puts another level of protection for commuters while fares are being reviewed. The task of maintaining a fair level of transport fares to commuters, however, should be shared between the Government and the transport operators.

Another factor to consider would be on subsidies or rebates on fares for senior citizens and students. This should be forthcoming from transport operators instead of from the Government only. If the transport operators are proactive in their community outreach through transport fare subsidies for senior citizens and students, then the perception and emotions of fare increases may be mitigated.

In order to promote this approach, perhaps the Government could consider giving tax concessions to transport operators for every dollar of subsidy contributed as an incentive for their contribution to society. Thus, with a combination of efforts from the Government and the private sector and a transparent approach to setting public transport fares, future adjustments to the public transport fares could be less controversial. Even with the best intention, any upward revision in transport cost would somehow not be met with understanding from the public, and the more frequent the adjustment of the fares is, the greater the chances of affecting even non-commuters. So I would urge the Public Transport Council to look at the possibility of matching the expectation of the public through constant feedback from users against the result of transport fares through the application of the new formula. Whatever the final adjustment is decided upon, it should preferably be applicable for a long time.

changes in wages, which is the average monthly earnings or the annual national average of the preceding year, adjusted for any change in employer's CPF contribution rate. In addition to the formula, the PTC is further encouraged to track the annual change in the percentage of household income set on public transport by a typical family. The price index derived is then further reduced by half the amount of productivity gain by transport operators. Thus, the maximum fare adjustment formula is a useful tool that the Public Transport Council could use to apply to the process of determining the level of fare increases or decreases. It could also be used by the PTC to make fare adjustments more transparent to the public.

Mass Rapid Transit

Some of the points have already been raised by the speakers before, and so I would not repeat them.

Sir, the Third and Fourth Schedules of the Competition Act that Parliament passed not so long ago excluded rail services, amongst some other essential services, from the need to have competition. Sir, was this the realisation

Besides the lack of population catchment, a contributory factor must surely be the lack of economies of scale in such a small area of operation. Would the Minister consider facilitating a consolidation of the train operators so that better economies of scale could be achieved for the benefit of commuters, as well as the single operator?

Sir, I do realise that SMRT and SBS Transit are public listed companies and it may not be appropriate for the Minister to tell these companies what they should do. However, I am sure that the Minister is ingenious enough to be able to come up with incentives for them to do the right thing and, at the same time, with disincentives if they continue to do the wrong thing.

One final point, Sir. Could the Minister also give us an update when Buangkok Station will be opened?

that having two or more train operators in Singapore for the sake of competition was not such a good idea after all? The second train operator operating the North-East Line, despite raising productivity by using state-of-the-art equipment and driverless trains, eliminating bus routes that could provide competition to its train routes and cutting cost by not opening, at least, one very important station, is still losing money on its train operations.

Mini-buses

Sir, I believe that our transport system over-emphasises private transport, by which I mean private cars and taxis. I have a suggestion to offer which addresses also a concern raised by hon. Members Mdm Cynthia Phua and Mr Yatiman Yusof, and that is, to introduce mini-buses.

Mini-buses carry more passengers than taxis. They are both socially and

Finally, let me add that if the Ministry accepts this suggestion, the mini-buses routes be awarded not to SMRT, SBS or some large corporation, but to another "S" - SMEs. Let this be another avenue for our local entrepreneurship. Let us award the individuals and, if need be, on an auction basis.

environmentally more friendly. Hong Kong is on the front page of our newspapers today. We have something to learn from Hong Kong, that is, how to use mini-buses. The Hong Kong land transport system is based on sound transportation economics, that is, hub and spoke. Subway trains connect the hubs, mini-buses provide the feeder. Mini-buses are better than feeder buses, addressing Mr Yatiman's complaint, mini-buses could run more routes, shorter routes and, above all, they could provide more frequent services. So, in this way, it will help to reduce the overall travel time and improve the service to our commuters.

School Buses

Sir, the safety of school children travelling to and from school is very important to parents like myself.

There have been cases of road accidents involving children, causing some deaths.

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Sir, there is another issue that needs to be addressed, ie, the use of seat belts in our school buses. It was drawn to my attention recently that, unlike passenger cars, there is no legal requirement for school buses to be fitted with seat belts. Also, even if there are seat belts, drivers are not required to ensure that the children actually put on these seat belts while travelling in those buses. I asked the bus operators why. Their answer is rather alarming. They said that there are many children in the buses. Often-times, they have to put three children per seat, when

Sir, I do not think this reason is acceptable. The operators do this because they want to reduce the fees to charge parents. I do not think Singaporeans are willing to compromise the safety of their children because of cost. More fundamentally, if it is true that there are no such regulation, it may seem that the Government is also willing to compromise the safety of our children when they travel on school buses.

Sir, I find it hard to explain to my children that whenever they are in my car, I will insist that they buckle up for their safety and also that it is required by the law. But the same message cannot be transmitted when they go on board the school buses. It is as though we are sending conflicting messages that seat belts are only important in daddy's car. Sir, I do not think this is right. We must be consistent in our message to our children. If the Traffic Police tagline is that seat belts save lives, then how can we promote this to our children when the requirement is not put in place?

Sir, I would like to ask whether indeed the Ministry does not have a policy of requiring school buses to be fitted with seat belts and, more importantly, to require the children to buckle up when they travel in school buses. If so, I urge the Ministry to study this matter seriously and act on it urgently.

the seats are actually made for two. As such, even if there are seat belts, the children will not be able to use them.

Taxi Operation

Sir, with the liberalisation of the taxi industry, the number of taxis has increased. This increase in supply has made it more difficult for the drivers to sustain their earning level which has, in fact, taken a dip. Many of our grassroots leaders have affirmed this fact, ie, the income has

One other solution is to raise fares so that taxi drivers can increase their income. With the deregulation of fares by the PTC in 1998, the Government can say that this is something that should be left to the market forces. There is clearly a market failure here, given that one company dominates the industry. I understand that this company alone owns 80% of the taxis in Singapore. There is distortion in the market where the price of the taxi ride cannot be determined by the normal market demand and supply forces. What are the measures put in place to help these taxi operators, especially the smaller operators to overcome the distortions of the market place?

In terms of safety standards, while it is important to set a high standard to protect the interest of the commuters, this must be reasonable. With the current situation where there are many taxis, many have to work much harder and longer. Fatigue sets in and this may have led to their poor safety record. What are the measures in place to help these drivers and operators to meet the safety standards set by the authorities?

dipped from about $1,600 to $1,200 a month. From the transport companies' perspective, is there any room for them to lower rentals? What are the operating costs and profit levels of these companies?

Taxi Diesel Tax

Sir, the Government has liberalised the supply of taxis and deregulated the taxi meter fare. Hence, the development of the taxi industry is subject to the demand and supply of taxi services. Based on the latest statistics released by LTA, the demand for taxi services has reduced, but the supply of taxis on the road continues to increase. Taxi drivers' incomes are

The recent surge in diesel pump price has worsened the situation. From March to December last year, the pump price had increased from 44 cents per litre to 90.2 cents per litre, a 123% hike in price. Sir, I am heartened to see that many taxi companies have come up with several temporary measures to help their drivers. More could be done to help taxi drivers by further reducing the taxi rental or other operating cost.

On the part of Government, I see the need to review taxi diesel tax. It is a right move on the part of Government to liberalise the taxi industry. We expect the industry to be market driven and competition will drive the cost down and stimulate better taxi services. However, we should also look at the unusually high cost structure of the taxi business. As we all know, high cost will prohibit the development of any industry in a market driven economy. I therefore urge the Government to review the high upfront statutory cost imposed on the taxi industry, in particular, the taxi diesel tax.

So far, there are two rationales on the imposition of taxi diesel tax. The first rationale was spelt out in 1985 - that the taxi occupies the same road space as a private car. The taxi should therefore bear the same amount of tax as private cars. Hence, the taxi diesel tax was steadily increased to $6,600 per taxi per year in 1989 and remained at that level till 1998.

The second rationale was the need to equalise the fuel tax imposed on private cars and taxis. Based on this reasoning, if fully implemented, the taxi diesel tax on each taxi could be as high as $9,200 per taxi per year. In 1998, Singapore was hit by the Asian financial crisis. As a result of

Sir, the high diesel tax imposed on the taxi industry was done when the supply of taxis and meter fares were controlled by the Government. Now that the taxi industry is liberalised, I urge the Government to take a fundamental policy shift on taxi diesel tax from an ownership-based traffic management tool to taxi industry development.

Sir, the most vulnerable group of people are the taxi drivers. High business cost means high taxi rental they have to pay daily. On top of that, they are also at the forefront to face the uncertainty of the demand for taxi services and, therefore, they can do nothing on the increasing supply of taxis on the road.

I strongly urge the Government to consider reducing the taxi diesel tax which will be crucial in smoothening out the transition from a highly regulated taxi industry to one that is responsive and market driven. This is particularly so for the taxi drivers who eventually have to bear all the costs imposed on the taxi business by paying their daily rental.

adversely affected as a result. They either have to drive longer to maintain the same level of income or suffer a reduction of income at around 10%-20%, based on feedback from the taxi drivers.the recommendation by the Committee on Singapore's Competitiveness, a review was done on the land transport cost structure, and the taxi diesel tax was reduced from $6,600 to $5,100 per taxi per year.

Sir, first, let me thank Mr Ong Kian Min for his kind remarks on the recent award which I received. In reality, the award is a recognition for all the right things that we have been doing in Singapore over the past years, and which have led to our development as an aviation hub.

On the issue of the cost of public transport and the Fare Review Committee's recommendations, first, let me thank Mr Ong Kian Min and his committee members for the recommendations that

The Committee, in its proposed fare review mechanism, has done a commendable job in taking care of both commuters and the viability of the public transport operators (PTOs). In arriving at the recommendations, the Committee consulted a wide range of interested parties, which I think is very good, and it set out clear principles on which fare adjustments should be based, and recommended a formula that is more responsive to prevailing economic situations and conditions.

More importantly, it has also recommended additional ROTA and affordability checks which the PTC can use to ensure that the interests of the commuters are protected.

One important outcome for commuters from the recommendations of the Committee is the possibility of fare reductions and rebates when economic conditions are poor, and therefore resulting in pay cuts and negative inflation. This is very fair, since a responsive formula should mean that when wages and costs go up, the fares also go up. And the fares should have a downward adjustment when these factors decline.

The recommendation for PTC to conduct a comparison check on the PTO's Return on Total Assets (ROTA) against that of operators overseas and other companies with similar risk profiles, will help ensure that the PTOs are not profiteering, which is another concern of Singaporeans.

This is important as the absolute level of profit per se does not meaningfully indicate if the PTOs are charging excessively or not. The level of profit has

Sir, I would like to inform the House that my Ministry has carefully studied the Committee's report, and I am pleased to announce that the Committee's recommendations have been accepted in full. There have also been some questions as to how a downward fare adjustment will be effected if the fare review formula comes up with a negative outcome. This is because in such a situation, few people will expect the PTOs, on their own, to apply for a fare revision. Sir, I am happy to inform Members that we will be amending the PTC Act later this year to empower PTC to determine if a fare reduction or rebate is warranted and, if so, to direct the PTOs to do so, even though the PTOs may not have applied for a fare revision. My Ministry will be working out the implementation details with the PTC over the next two months to put in place the new mechanism for this year's fare review exercise should the operators submit an application.

Sir, on the issue of affordability, I agree with Mr Andy Gan that commuters have to be realistic. They cannot expect fares to remain unchanged over time as costs increase and the service levels improve. But because public transport is used every day by a large spectrum of the population, it is understandable for the general public to worry about any fare increase, no matter how small. And hence the feedback received by Dr Wang Kai Yuen's Feedback Unit.

Sir, I would like to take this opportunity to correct any wrong

in the Chair]

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At the family expenditure level, the average household expenditure on public transport has also declined. The survey shows

they have submitted on how to improve the fare review mechanism. Public transport fares have always been a very sensitive issue as it affects almost every Singaporean. to be compared against the amount of investment that the operators have put in. For example, if the investment involved amounted to $1 billion, a profit of $10 million, in fact, only represents a very meagre 1% return on the investment. But a $10 million profit made on an investment of $20 million would mean a very huge return of 50%. impression about the affordability of our public transport system. Since we implemented the CPI + X formula in 1998, the actual increase in public transport fares averaged only about 0.7% per year. This is significantly lower than the average increase in wages of 3.4% per year over the same period. And if we compare over the last 15 years, the picture remains very similar, with our wages going up very much faster than fare increases. And this is well reflected in the proportion of monthly household income that is spent on public transport. The Household Expenditure Survey shows that the percentage of income spent on public transport has gone down from 3.6% in 1988 to 2.8% in the year 2003. This represents a 20% drop.

that the public transport expenses accounted for 5.1% of monthly household expenditure in 1988 and only 4.1% in 2003, also a 20% drop.

Sir, this clearly shows that our public transport fares have become more affordable, not less affordable, over the years. As Dr Wang Kai Yuen has pointed out, there is a perception gap in the minds of the public, in terms of the trend of public transport fares. The perception is that fares have been going up very fast and becoming less affordable. I think this is also partly due to the failure of the PTC to properly communicate the situation each time there is a fare adjustment and we have worked out with the PTC a mechanism to ensure that there is a proper explanation on the basis of any fare revision and to do a comparison in the affordability as well.

Sir, if we compare against other developed cities like Hong Kong, the average bus and MRT fares for an 8-km trip in Singapore are also definitely much lower. This is due to the very commendable efforts put in by the PTOs over the years to increase productivity and to reduce their cost. Sir, the PTOs have also been pursuing non-fare revenue streams, such as the development of commercial spaces within the MRT stations, to help offset any increases in operating costs. The recent opening of the revamped Raffles Xchange at the Raffles Place MRT station is a good example of the operators' effort and what can be achieved.

Sir, the new mechanism requiring PTC to also review affordability of public transport will further safeguard the public. PTC will now be empowered to not approve any fare increase should there be significant deterioration in affordability.

While the vast majority will find public transport fares affordable, I think there will always be a small minority who will find it difficult coping with the cost of everyday living, and not just the cost of transport, but also the cost of basic necessities like food, utilities, transport and housing. This has also been recognised by Prof. Chin. Sir, I think that help for the needy, the unemployed and the people who are structurally affected by the reforms in the economy, all these will have to be helped through a wide range of financial assistance schemes provided by MCYS, CDCs, VWOs and others, as well as the ComCare Fund which was announced by the Prime Minister in his Budget Speech.

Sir, let me once again thank Mr Ong Kian Min, his predecessor, Mr Chay Wai Chuen, and his committee members for their painstaking efforts in coming up with the very commendable set of recommendations.

Sir, let me now touch on the points brought up by Mr Gan Kim Yong who expressed his concern that public transport fares may go up on account of fuel price hikes. He also asked for assurance that there will be no fare revision this year.

The Fare Review Mechanism Committee has recommended that the cost conditions facing public transport operations be captured in the formula, by the CPI and the Wage Index components. However, in times of significant structural changes in fuel prices, the fuel cost increase is likely to outstrip the increase in CPI. I think this is especially crucial because fuel costs make up a very major part of the cost operation of the public transport operators. Hence, the composite CPI may not adequately capture the inflation of this single cost component. There could then be a case for the PTC to consider a one-off fare adjustment. Nonetheless, as in all fare adjustments, I am sure the PTC, as the gate-keeper, will carefully consider the merits of the case and the impact on commuters before granting any such increase if the PTOs should apply for one. On the other hand, Members should also be further assured that, before this takes place, we would first use the Fuel Equalisation Fund, or FEF. The aim of the FEF is to help operators mitigate the impact of sharp and temporary increases in fuel and electricity prices. Let me explain the FEF mechanism. For periods when fuel and electricity prices are lower than a reference price level, the operators are required to contribute a portion of their profits into the Fund. They can then subsequently draw from the Fund if they need to cushion spikes in fuel or electricity prices. The Fund mechanism therefore provides a buffer against volatile fuel or electricity prices, which would otherwise have to be translated into fare adjustments.

Mr Gan Kim Yong asked if it is desirable to implement the formula at this stage when the economy is recovering since there is a greater likelihood for the fare cap to go up. Sir, this is a valid observation. In fact, it is for this very reason that the Committee has recommended several levels of checks, ie, the ROTA and affordability checks to be undertaken by the PTC before it approves a fare revision. This is to ensure that the interest of the commuters will continue to be protected.

Sir, he also urged the Minister and the PTC not to allow a fare increase this year. As to whether there will be a fare increase or a fare revision this year, that is a question that only the PTC can answer. As Members know, the PTC is a fully autonomous and independent body. The usual process is for the PTOs to submit their applications, if any, to the PTC around the end of April. The PTC would then deliberate carefully and announce the outcome in June. I am sure that the PTC will continue to safeguard the commuters' interests and ensure that the fares remain affordable, especially now that we have a more responsive fare adjustment formula.

Sir, let me now move on to the issue of land transport strategy and the integration of the bus and MRT systems. Mdm Cynthia Phua asked about the long-term strategy for our public transport system, and in particular about the need for better integration between the various modes of transport.

Our public transport strategy is to establish a well-integrated public transport system. The rail system forms the backbone of our public transport network, serving the key corridors between major residential areas and activity centres. Buses complement the rail system by serving the less-heavy corridors and

Sir, as the MRT system involves huge investments by the Government, PTC aims to ensure that the bus and rail systems are well integrated to optimise the use of the expensive MRT system. The PTC achieves this by setting out Quality of Service Standards (QoS) for bus services. For example, PTC requires that the first feeder buses from all HDB neighbourhoods must leave the interchange before 6.00 am to facilitate connection with the early MRT train or trunk bus service. The operators are also required to provide direct feeder bus connections from all HDB neighbourhoods to the town's bus interchange, which is usually co-located with the MRT station.

While there may be some concern about the duplication of resources, I would like to highlight that, whenever a new train line is opened, the operators are required to re-route some bus services to strengthen the bus connections to the rail line and to avoid duplication of routes. However, it is inevitable that there will still be short incidental stretches where the buses run parallel to the rail system. This is due to the need to serve short-distance travel and provide local connectivity within the rail corridor. In other cases, two points may be connected by both the bus and rail lines. For example, in the case of Tampines, the MRT and bus service No. 10 connect Tampines to Raffles Place. However, there is actually very little duplication because bus service No. 10 primarily serves to provide local links to the Katong and East Coast areas which are not served by MRT. The travel times are also very different. The MRT ride to Raffles Place takes only 27 minutes, compared to the 68-minute bus ride! I do not think they really compete with each other for passengers.

Mdm Phua also asked PTC to evaluate bus routes independently to ensure that the bus network is efficient. I want to assure Mdm Phua that PTC does consider the efficiency of the entire bus network and the potential impact on commuters when reviewing any changes to the bus routes. For example, when the NEL line was opened, we had to do the bus rationalisation exercise, and the two operators, SBS and MRTC, together engaged an independent consultant to study and propose changes to the bus routes and, after the proposal was completed, PTC would then review the entire proposal to make sure that the entire system is rational. So it is not something that is done at the whim and fancy of any operator. But PTC takes a very active role in making sure that the bus network is rational and efficient.

Sir, Prof. Chin Tet Yung and Mr Charles Chong commented on the structure of the rail system and asked whether we should continue to have two rail operators. Let me assure them that while the two operators do not directly compete, there are still benefits to the current structure. First, it promotes integration of services as we have seen, and allows benchmarking between the operators. Second, the two operators will still have to compete to have the best approach to a safe, efficient and productive operation. In doing so, each will have lessons for the other, and the improvements that are gained will ultimately also benefit the commuters.

Sir, on the merger of the rail operations of SMRT and SBS Transit, as observed by Mr Chong, this definitely is a matter of commercial decision for the two operators to make, as I have also informed this House before. Given that they are both publicly-listed companies, it would be difficult for the Government to intervene to direct them to merge the rail operations. I do not think we are in a position to give any operator any

Sir, Mr Charles Chong also asked when Buangkok station will be opened. I want to assure him that LTA monitors very closely the developments around the area. Once there is an adequate population catchment around the station, LTA will arrange for the station to be opened as soon as possible. The breakeven point, based on the calculation, is that once there are about 2,000-3,000 housing units available in the immediate vicinity of the station, we should be able to ask the operator to open it. So we will continue to monitor and work with Mr Charles Chong.

Sir, Prof. Chin Tet Yung asked about the achievements versus the White Paper, and how far have we gone and how much more catching up we have to do. I am happy to tell Prof. Chin that there is no catching up to do, because we have already more than exceeded the targets set under the White Paper. Let me give him an example. In the White Paper, there was a target that we should add another 225 kilometres of road network at the cost of $1.1 billion over the next five years,

linking commuters to the stations. Taxis, on the other hand, provide a personalised, door-to-door service which is more akin to private transport.subsidies just to effect the transfer. So far, we have not received any proposal from them. However, we would not object to a merger if the operators wish to do so to achieve better economies of scale, which I think there is, and better operational efficiency.

ie, the first five years after the White Paper was published. I am happy to inform Prof. Chin that the road network has actually exceeded the target by about 84%, ie, we have added a total of 415 kilometres versus the target of 225, and we did it at a lower cost of $916 million, compared to the $1.1 billion budgeted.

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Sir, in terms of the rail system too, under the White Paper, we had a target to expand the rail system from 67 kilometres

Sir, let me now move on to the point about feeder services. Mr Yatiman Yusof described the woes of his Tampines residents with regard to the feeder services. Sir, I think the transport needs of the HDB towns in many ways exemplify the complexities of planning a public transport system and network. For example, in a single precinct, there may be 2,000 people living there who need to travel to 1,000 different points in Singapore. How do we provide a system that will efficiently and cost effectively link them to those points that they want to go to? I think there are two extremes.

The first is to provide a very personalised service where each of them can have a door-to-door service. In fact, this is available today. The taxi service provides that but, of course, at a very much higher cost than what the bus and MRT would cost. The other way is, of course, through private transport.

The other extreme, the cheapest way, is to have one trunk route which will link that precinct to every point in Singapore. Of course, the last passenger to get off the bus may have to suffer a three or maybe four-hour bus journey. So, that again is not viable.

The most efficient, cost effective and prudent model is the hub-and-spoke system which is used in most, if not all, countries. In Singapore, I think our feeder services are in fact very efficient, with the headways during the peak hours