Hansard, 2005-07-19

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) Dr Tan Cheng Bock 19 Jul 19 Jul Mr Ong Kian Min 20 Jul 24 Jul Mr David T E Lim 24 Jul 30 Jul Mr George Yong-Boon Yeo 24 Jul 30 Jul 01 Aug 02 Aug Dr Ong Seh Hong 24 Jul 26 Jul

ABDULLAH TARMUGI Speaker Parliament of Singapore

[Mr Speaker in the Chair]

1. Dr Lily Neo asked the Minister for Health (a) whether the prevalence of stroke cases is on the increase; and (b) has the Ministry any plans to reverse this trend.

The recent study conducted by the National Neuroscience Institute estimated the crude prevalence of stroke at approximately 4% in people aged 50 years and above. As this was the first such local study, we do not know if the prevalence is on the rise. However, our hospitalisation records show that there are about 7,500 cases of stroke every year and this has been so for quite some time despite the fact that our population numbers have been going up.

Age is the single most important risk factor for stroke. With our ageing population and improving survival rates, we can expect the prevalence of chronic diseases such as stroke to increase.

Conditions such as high blood pressure, smoking, obesity, diabetes and high cholesterol further increase the risk for stroke. Fortunately, these risk factors can be modified through active lifestyle changes.

There are two key strategies to address this problem. First, improve the overall risk profile of the population through initiatives such as the National Healthy Lifestyle Programme. Second, detect and treat those who have developed risk factors for stroke.

In this connection, the recent National Health Survey has been encouraging. The prevalence of most risk factors has moderated. Management of those with diabetes and hypertension also appears to be improving.

We should therefore press on with our healthy lifestyle campaign. If Singaporeans continue to improve their risk factor profile, hopefully we can control the prevalence of stroke even as our population ages.

May I ask the Senior Minister of State, in view of

the fact that stroke is on the increase, especially with an ageing population and the fact that stroke can be prevented by early detection and better care of hypertension, diabetes and cholesterol, is the Senior Minister of State happy with the present available preventive measures and what else can be done to improve this situation?

I agree with Dr Neo that prevention is better than cure. In terms of managing stroke, we have a three-pronged approach. First, there is primary prevention. Primary prevention is mainly geared towards raising awareness and providing the skills and means for people to adopt a healthy lifestyle. Then, there is secondary prevention. This detects people who may have developed risk factors such as stroke and diabetes and manage these people so that their chance of developing a stroke would be less. For tertiary prevention, this is managing people when they come to the hospital with their TIA or minor stroke and managing them so that their outcomes are better.

In terms of actual numbers, in the year 1998, we had about 7,350 stroke patients, giving us a rate of 332 per 100,000 persons and it has remained about the same level. The actual figure in 2004 was 7,345. But because our population has increased, the rate has actually come down to 211 per 100,000. Likewise, because of improvements in the tertiary care, the mortality rate has come down. In 1997, the mortality rate from stroke was about 38 per 100,000. Last year, it was 28 per 100,000. However, we should continue to work and see if we can bring these rates down further.

Mr Speaker, may I ask the Senior Minister of State, in view of the fact that more than 50% of stroke survivors in Singapore end up with moderate or severe disability and the fact that disability can be lessened by early

detection and treatment for 70% of ischemic stroke, will the Minister step up awareness in the prevention and disability from stroke with the medical profession and the public as well as offering better and earlier stroke detection and care in our public hospitals?

Again, Dr Neo is correct. Educating our general practitioners and increasing their awareness is part of stroke prevention. That is why we have a lot of education programmes for our primary healthcare physicians with regard to stroke and other risk factors for cardiovascular disease. This is because most patients would see their general practitioners and primary healthcare physicians for management of minor diseases and for other reasons. These physicians are in the best position for primary and secondary healthcare. We think this has improved with new requirements for CME which came in several years ago so that now, our primary health physicians are also in tune with what the hospitals are doing and what the Ministry is doing in terms of bringing our stroke rates and cardiovascular disease rates down since the risk factors for both are quite similar.

The Senior Minister of State did not answer about the care in hospital. Could I just also ask for the support schemes available to stroke patients and their family members in terms of medical and social support since stroke disability can be long term and imposes great medical, social and financial burden on the families, especially those who have lost their breadwinners?

With regard to our hospitals, our hospitals are also improving their treatment as indicated by the drop in the mortality rates which I have just given her a little while earlier.

Stroke is a burden on families, especially if they are left with disabilities.

There are welfare workers and a whole lot of social support work that is provided for these patients. It is managed partly by my Ministry and also by MCYS. If the Member wants to know more details about this, she could table a Question at the next Parliament sitting because that is not in her Question.

2. Dr Lily Neo asked the Minister for Health, in view of the fact that prostate cancer is on the increase and 50% of deaths are due to late diagnosis, what is his Ministry's plan to prevent deaths due to prostate cancer.

Prostate cancer is the fifth most frequent cancer among Singapore men. Its incidence rate has increased from four per 100,000 population per year during the 1968 to 1972 period to the current incidence rate of 17. One key reason is that Singapore men are now living longer. Nevertheless, our rate is low compared to other developed countries.

In 2003, prostate cancer accounted for less than 1% (0.8%) of all male deaths in Singapore. 94% of these deaths were in men above the age of 65.

The treatment for prostate cancer has improved significantly over the years. A local study has shown that the five-year relative survival from prostate cancer has improved from 39% in the 1968 to 1972 period to 57% in the 1988 to 1992 period.

Although it has been suggested that Prostate Specific Antigen (PSA) screening for prostate cancer can result in early diagnosis of the cancer, there is no conclusive scientific evidence that

population-wide PSA screening can reduce prostate cancer mortality.

Could I ask the Senior Minister of State whether PSA is not the best method for early screening of prostate cancer? Therefore, could MOH consider targeted community screening, subsidising PSA test at $5 each in line with the initiative done by the Singapore Prostate Association during the prostate awareness week for men above 50 years of age with symptoms such as frequency of urine, incomplete emptying of bladder and also with a family history of prostate cancer?

The answer to the first question is no. There are no studies that show that population-based screening for PSA improves the outcome. If anyone has such scientific studies, they can submit it to MOH. If there is no scientific evidence that the outcome will be improved, then it is not a question of whether it is $5 or whatever price the test may be. The problem with screening with PSA is that there is a high false positive rate. So while you may pick up more patients with so-called "prostate cancer", many of them will not have aggressive prostate cancer and as a result, there will be people who are treated aggressively for a disease when the disease itself may have a benign outcome. And, hence, we may do more harm than good by doing a population-based PSA screening regime. Because there are no scientific studies that support it, we have not proceeded with that.

Mr Speaker, Sir, I thought that for this question, a male Member should be more interested than a female Member, especially for aged male Members. May I ask the Senior Minister of State whether it is not true that there is a higher incidence of prostate cancer in the older age group,

ie, those in their 60s and 70s? Maybe the Minister can consider encouraging wider diagnosis and examination for the older age group and therefore allow them to use some funding, for example, from Medisave, for this kind of test.

Again, I would like to point out that the issue is not an issue of cost. The issue is: should screening be done on a normal population? The reason why it is not done is that large numbers of people, once they reach a certain age, will have cells in their prostate that one would consider prostate cancer. As a result, you may have a raised PSA. But it does not result in clinical disease and the life expectancy of these people is not reduced. So when you do screening, you may pick up people with essentially a benign disease. But because you have now diagnosed them as prostate cancer, you then subject them to treatment and the results of your treatment regime may be worse than if you had left them alone. That is why we should not proceed unless there are scientific studies to support it. If there is any physician who has scientific studies, the right thing to do would be to submit his or her scientific studies to the necessary experts and if the experts present to MOH a scientific case for doing that, then we will do it.

Mr Speaker, Sir, can I differ in opinion with the Senior Minister of State because actually, prostate cancer is the fifth most frequent cancer in Singapore presently and its incidence is increasing at 5.6% annually? And we all know that early detection can save lives. Therefore, do we not want to save people and will not the Ministry provide better detection and, at least, increase awareness amongst the public with regard to prevention and deaths from prostate cancer?

Mr Speaker, Sir, we all want to save lives. So we are all on the same side. But the important thing

is that whatever we do, there must be scientific evidence. And if you have scientific evidence that a population-based screening system reduces mortality, the right thing to do is to collect that scientific evidence and send it to the Academy of Medicine, the chapter of urologists, who are the experts in that field and if they advise us that we should consider it, we will.

Sir, I have two questions for the Senior Minister of State. First, I am not a medical doctor but I would like to ask him: if a case is being detected as a possibility of prostate cancer, could it be further tested whether the case is benign or malignant? That being the case, if it is benign, we do not treat the person but, if it is malignant, then we will treat him. Why should we treat a person if he is tested benign?

The other question I want to ask is: should not the Ministry of Health go into studies on the incidence of prostate cancer since it is the fifth most frequent cancer in Singapore?

Mr Speaker, Sir, therein lies the problem. If a person has PSA positive or slightly raised, then we have to decide whether the person has benign disease or malignant disease. So the person will then be subjected to a biopsy, because there is no point in doing a PSA if you are going to have a result and not do anything about it.

The biopsy itself carries a certain amount of risk because it is an invasive procedure, and people have had complications from the biopsy. A biopsy samples only a small part of the prostate, and not the entire prostate. So if your biopsy is positive, you are going into one category. If your biopsy is negative, it does not mean that you may not have prostate cancer. Then you come to the question: if you did see so-called malignant cells in your biopsy, does this

mean that this is going to be the type of prostate cancer that is going to matastise and reduce your life expectancy? Or is this going to be the changes that we see where it does look malignant but, clinically, its cause is benign and therefore your life expectancy is not going to be affected by it, and surgical intervention or treatment may actually do you more harm? So these are all the considerations in terms of treating prostate and these are all the problems with population-based screening.

Prostate cancer is not unique to Singapore. There are many countries with a rate of prostate cancer that is much higher than Singapore. And the experts in these countries have looked at the data and none of them have advocated a nation-wide screening test. So, if there are individuals who strongly believe in it, the approach should be to garner the scientific evidence, submit it to the experts, and the experts are the chapter of urologists in the Academy of Medicine and let them evaluate. Because, really, it is not something that we here are the experts who can evaluate and tell you, yes, you are right and our specialists are wrong. But if you have such evidence, please send it to the Academy.

I think we have had enough of prostates! Dr Neo, last question, please.

Sir, may I suggest to the Senior Minister of State that, in fact, we do not need to do invasive biopsy as a second line after having prostate PSA, where we can do non-invasive test like ultrasound of the prostate to check whether the patient has really prostate cancer or not?

The other thing is: should we always wait for other countries to do the screening rather than do our own? Because we have a smaller population

base and we have a better medical system here that we can do things that other countries may not be able to do.

When you are the first to try something, you may be the first to benefit from your initiative, but you may also be the first to suffer from the initiative. Because, as I have pointed out, as there is a high rate of false positives, you may end up treating many people for a disease that they do not have. Again, as I said, if you think that there is sufficient evidence, I would suggest that you marshall all the evidence, send it to our urologists who are the experts in this area and convince them to recommend to us that that is the right thing to do.

3. Mr Leong Horn Kee asked the Minister for Health in view of the recent global increase of polio infection cases, what actions are being taken by his Ministry to guard against the spread of this disease in Singapore, especially against the spread from external sources.

Mr Speaker, Sir, polio vaccination was introduced in Singapore in 1962. All new-borns have since been vaccinated against polio starting from three months of age, and given boosters when they are in Primary 1 and 6. We have thus maintained very high immunisation rates which confer 'herd' immunity in our population. Even if there is an infection from external sources, it will not spread. The last local case of polio was reported in 1978 and the last imported case in 1986.

Our high standard of hygiene and modern system of sewage disposal also

minimises the transmission of poliomyelitis through the faecal-oral route, which is the main cause of transmission in the community. There is thus very little risk of a polio outbreak in Singapore.

Though we have already eradicated polio locally, we will continue to maintain a high degree of surveillance to check for imported polio cases.

Despite the detection of isolated cases in Indonesia recently, WHO reports that polio is close to eradication. To give Members some idea of the perspective of risk today, say, opposed to 20 years ago, in 1988, there were 350,000 cases of polio in the world. Last year, there were only 1,266 cases. So, as far as the world is concerned, we are coming close to eradicating polio. And that is why when cases are reported in countries, they get a lot of publicity.

4. Mdm Cynthia Phua asked the Minister for Information, Communications and the Arts whether our charges for Internet broadband and mobile telephones are more expensive compared to our neighbouring countries.

Mr Speaker, Sir, Mdm Phua asked if our charges for Internet broadband were more expensive compared to our neighbouring countries. The Internet broadband charges in Singapore are set by the market. Competition and technological advances have driven prices down and increased broadband subscription. Prior to 2000, majority of the consumers were on dial-up Internet access plans. Since 2000, consumers were able to subscribe to

broadband services via cable modem or ADSL technologies. Higher access speeds are more common now and consumers can choose from broadband access of 256 kbps to as high as 25 Mbps. Residential broadband prices have declined by up to 70% for unlimited access plans since 2001. There are also low cost packages for novice users with low usage. Household broadband penetration has increased to 46.6% in May 2005, up from 33% in December 2003. Today we estimate that more than 40% of broadband subscribers in Singapore are on access speeds of at least 1.5 Mbps.

While broadband prices have become more competitive and access speeds have increased, IDA recognises that Singapore still lags behind the leading regional economies of Korea, Japan and Hong Kong. However, in comparing broadband prices, we must be mindful that every country has different cost structures. On this aspect, I have explained in this House in September 2004 that underlying factors such as market size, usage profile, web surfing habit as well as competition from alternatives can have important impact on the price.

Recent media reports had cited that the prices of local broadband access were kept high by the anti-competitive behaviour of incumbent operators controlling critical telecom infrastructure and thus hampering the entry of competitors into the market. The reports also suggested that such conduct had gone unchecked by the regulator. Such perceptions are unfounded.

First, IDA has consistently worked to overcome the lack of effective competition in infrastructure by requiring SingTel and StarHub to offer wholesale broadband access to their respective networks. IDA has also mandated SingTel to offer its local leased circuits and unbundled local loops at regulated pricing. These measures are aimed at enabling

Internet Service Providers (ISPs) not affiliated to these two companies to compete with them in the retail broadband services market without having to make heavy infrastructural investments.

Second, to encourage greater competition, IDA is working closely with various industry players to offer alternative broadband access technologies, such as wireless broadband. In May 2005, IDA conducted an auction to allow industry players to bid for spectrum rights to provide wireless broadband access services in Singapore. IDA believes that the six operators that were awarded the spectrum rights will provide further competition in the broadband industry and open up more innovative and competitive broadband packages to consumers and businesses.

In addition, IDA is also supporting technical trials in alternative broadband technologies that can lower deployment cost and increase access speed. These technology trials and pilot projects will help to iron out technical, operational and business issues. If successful, these trials will provide greater incentive for the operators to deploy these new technologies on a larger scale.

I would like to assure this House that IDA will continue to seek strategic partners to deploy new technologies and business models to enable users in Singapore to enjoy competitive, pervasive and high-speed broadband access.

Mdm Phua also asked about our mobile phone charges. Singapore's mobile market remains one of the most competitive markets in the region, with a large variety of price plans available for consumers to choose from, bundled with various attractive incentives such as free incoming calls and free IDD calls. For example, a typical non-free incoming GSM mobile phone package would cost consumers in Singapore approximately

$28 per month which comes with additional bundled services such as free SMS, caller IDs and voicemail. I would like to point out that at this price range, our mobile services are not out of line with other regional markets. However it is not possible to make direct comparisons on account of the various packages and bundlings being offered by each and every operator.

Our competitive mobile sector is largely due to the liberalisation of Singapore's telecommunications market. Prior to April 1997, Singapore had only one operator for mobile services. However, with the entry of M1 in April 1997 and StarHub Mobile in April 2000, consumers now not only have three operators to choose from, but also a large variety of service packages available to them. Competition has resulted in lower mobile prices and greater innovation in services as operators sought to differentiate themselves. As a result, mobile phone penetration in Singapore is one of the highest in the world at 95.5%. This means that there were over 4 million subscribers in May 2005. Operators have also commercially launched 3G services since early 2005 at prices comparable to 2G (or GSM) services, opening up more service offerings to consumers.

In conclusion, MICA and IDA will continue to promote competition in our broadband and mobile market for the benefit of consumers.

Mr Speaker, Sir, being a global economy, these two services are critical for our businesses as well as for individuals. Can the Senior Minister of State tell us exactly how do our charges compare to China, Malaysia and Korea? In addition, is his Ministry also looking into regional alliances with broadband service providers of other countries so that these regional

alliances could bring down the cost of business across countries?

Sir, I believe Mdm Phua is concerned about international calls in the region. While local calls may be relatively cheap, the cost of international calls can vary. And this is because, particularly with roaming services, there are business arrangements made with companies that are outside our jurisdiction. To provide seamless connectivity when consumers roam between countries, there are commercial agreements in place between the local and the overseas operators.

The cost structure for international roaming services therefore comprises several components. A mobile user would typically need to activate an international roaming service with his mobile service provider before he can make and receive calls while overseas. The activation of the roaming service may incur a one-time charge and subsequently there may be monthly subscription charges. In addition, there are also charges placed by the operator in a particular country that your call is going to. Those charges are not under our jurisdiction. So, while we are able to use market competition in Singapore to keep our charges down, it is not possible to determine what the charges in these countries will be. Hence, while businesses

would like to have the charges as low as possible, we can only control using the market for the charges from the Singapore side.

Sir, I just would like to know whether MICA is aware of the penetration of broadband access to the lower-income families in Singapore.

I do not have the data in terms of broadband penetration depending on income level, but we can check that up and provide that to the Member.

The Senior Minister of State has not answered the cost comparative with China, Korea and Malaysia. I would just like to have an indicative pricing as to our level of charges.

It is very difficult to make comparisons across countries because there are various packages across countries. But if we look at prices internally within Singapore, we can see that the prices have come down as a result of competition. For example, SingTel's Classic Plan in 1997 cost $45 a month. An equal plan today in June 2005 costs $28. Likewise, MobileOne's Prime Plan, which was $40 in 1997, has come down to $28. So, while it is possible for us to compare prices of similar packages in Singapore, it is very hard to make comparisons across countries.

5. Mr Zainudin Nordin asked the Minister for Education (a) what is the progress of his Ministry's efforts to promote the Malay Language as a third language in schools; (b) what is the take-up rate and how many schools are providing these options; and (c) what resources are being allocated to ensure that we continue to have sufficient Singaporeans other than the Malays who are conversant in the Malay Language.

Mr Speaker, Sir, in March this year, the Ministry of Education (MOE) announced that it will provide more opportunities for our students to learn Malay. Currently, most students offering Malay (Special Programme) (or MSP) have to take classes at the Ministry of Education Language Centre (MOELC).

Ministry of Education is facilitating the opening of more MSP centres, and more school-based MSP programmes.

In May this year, MOE announced that three schools will serve as MSP zonal centres. These three schools are Tampines Secondary School (for East zone), Zhonghua Secondary School (for South zone) and Bukit Batok Secondary School (for West zone). These zonal centres, as well as the MOELC, will cater to students from schools in the vicinity of the centres. In addition, seven other schools will start their own school-based MSP from next year. Just for information, these seven schools are Raffles Institution, Raffles Girls' School, Hwa Chong Institution, Nanyang Girls' High School, Chung Cheng High School (Main), Nan Hua Secondary School as well as Dunman High School. Additional teachers have been posted to these new MSP zonal centres as well as the seven schools which will start their own programmes. MOE has also completed a review of the MSP syllabus and instructional materials. This is to help the students find their lessons of practical relevance, and to enthuse them in their learning. The revised syllabus and the interim instructional materials will be ready for use next year in 2006.

Currently, under the MSP, Malay is available as a third language to non-Malay students who are within the top 30% of the PSLE cohort, and if they have also done well in Mother Tongue and English. Over 640 students currently offer MSP at the MOE Language Centre in Bishan.

In May this year, MOE has announced that the relaxation of this criterion will be brought forward to 2006 instead of 2007, as announced earlier. This is made possible with the setting up of more school-based MSP and zonal centres, and all these increase the capacity to cater to

students with an interest in the programme. A few schools that were ready have, in fact, implemented the programme from this year, using their own resources.

Besides MSP, MOE is also encouraging schools to offer conversational Malay as an enrichment programme. The Ministry has prepared teaching guidelines for conversational Malay for primary and secondary schools, as well as junior colleges. These guidelines are on teaching strategies, learning activities, sample lesson plans as well as assessment modes. Copies of the guidelines will be sent out to all schools soon, ie, later this month. MOE will also render consultancy services to schools interested in starting their own Conversational Malay as an enrichment programme.

The Ministry will continue to support the setting up of school-based MSP in terms of teaching resources. We will also provide regular in-service workshops for MSP teachers.

Sir, I would like to thank the MOS for a very comprehensive reply. I just would like to know whether, at the rate that the Ministry is going, we will have enough teachers to cope with the demand of the students.

The Ministry of Education will not embark on the programme if we are not confident about the availability of resources, including the teachers. In fact, one point that we may have to consider seriously, speaking as an experienced person, is for the parents perhaps to encourage the students to learn the Malay language under MSP. Because these are students who are already learning English as well as the Mother Tongue, some of them Higher Mother Tongue, in addition to MSP. To

learn two languages is already quite difficult. To learn three is really a very major challenge. So, in fact, I would consider this to be a more serious challenge than our ability to make available teaching resources in these various centres.

6. Assoc. Prof. Ong Soh Khim asked the Minister for Education (a) what are the percentages of polytechnic graduates taking up degree programmes in local and overseas universities respectively; (b) with respect to these percentages, are polytechnics becoming another category of junior colleges; and (c) what is the original intention of polytechnic education and has the original intention been largely fulfilled.

Mr Speaker, Sir, in recent years, about 60% of each cohort of polytechnic students have gone on to pursue a university education, either locally or overseas, within five years of graduation from polytechnic. Of these 60% of polytechnic students, about 13% go on to an undergraduate education at our three local universities and the other 87% or so obtain degrees elsewhere, either other locally-run programmes or distance learning programmes offered locally or at overseas universities. By 2010 when NUS and NTU would have expanded their capacity, the proportion of polytechnic students that will be going to NUS and NTU would more than double to over a quarter of the total number of polytechnic students who go on to obtain a degree. Over a quarter of them would be able to obtain their degrees at NUS and NTU.

Assoc. Prof. Ong had asked if the polytechnics are therefore becoming another category of junior colleges. They are not becoming like junior colleges. Our junior colleges and polytechnics provide

distinct but complementary paths within our post-secondary education system. The JCs offer an academically-oriented programme to prepare their students for a university education. Our polytechnics provide students with a technically-oriented tertiary education that prepares them well for good careers and which meets the needs of the economy. The hallmark of a polytechnic education is the applied and practice-oriented teaching and learning approach. While many polytechnic students do go on to obtain a degree, they tend to retain this technical and applied orientation when they return to the workplace.

Our polytechnics are also well-placed to nurture students with a certain entrepreneurial spirit, a "can do" spirit, and encourage their students to engage in innovation and design work. The polytechnics will continue to review and update their curricula, and work closely with the industry, so as to keep up their reputation both locally and abroad, develop the talents of their students and provide well-trained manpower for the Singapore economy.

Sir, I have three supplementary questions. With regard to the 60% of students who actually went on to pursue higher degrees locally or overseas in the next five years, is that indicative that the polytechnics are actually attracting a significant portion of the top "O" level students such that less good students are actually going to the JCs and subsequently the universities in Singapore?

My second question is this. It is well known that a polytechnic foreign university degree path is shorter than a JC local university path. So, has polytechnic education become a short-cut to obtaining a degree?

My last question is, in view of the recent calls by SM and MM for more top

students to attend local universities, how does the Ministry propose to attract more top students to attend JCs and local universities, instead of taking the polytechnic foreign university degree path?

First, I should just clarify that the 60% of polytechnic students who do go on to obtain a degree, I was not referring to the next five years. But that is the current status. This refers to people who within five years of graduation tend to go on to obtain a degree.

Are they attracting more of the brighter students - those who would have been eligible to enter the junior colleges? There was some increase in numbers, particularly as the polytechnics open up courses which appeal to students, eg, digital media and courses like that. But it has stabilised. Basically, about a third of our polytechnic students would have done well enough in their "O" levels to be able to enter a junior college but chose to go on to polytechnics. I think it is not a bad thing that we have some diversification of the pathways that our students take. They have different talents, different intellectual orientations. Not everyone is well served by JC education. But not everyone is well served by pursuing the polytechnic route either. So we should preserve both routes. I think that is the strength of the Singapore system - that we have two totally credible routes of post-secondary education for students of both high intellectual abilities as well as those who have other types of abilities which are best served by a non-JC path to post-secondary education.

Is it a short-cut? Well, it depends. It depends on which university they are going to, how many years of credit do they get, either one or two years' credit off for their polytechnic degree. I think

this is something we leave it to the marketplace.

Sir, I have a supplementary question again. So we leave it open, ie, there is a JC local university degree path and there is a polytechnic foreign university degree path. However, if you flip open the newspapers nowadays, it is quite well known that many foreign universities actually offer one to two years' exemption, while the local universities, at most, only offer a one-year exemption. Would the Ministry help the local universities to also provide a shorter path, so that we can actually pull these good students to the local universities after their polytechnic education, instead of going to a foreign university?

This is something for the universities to decide for themselves - what admission standards to set and, having admitted the students, how much credit to give for the course work that they have done in the polytechnics. Universities vary quite widely in their standards. Ultimately, the real judge is the employer's marketplace. How much worth an employer attaches to a degree from a particular university will depend also on the standards that the university applies. So, it is something which our local universities have to think hard about. Yes, they are facing some competition from foreign universities that are quite liberal in offering credits for work done in the polytechnics. Some of these are good universities. For some others, the market has to judge what their worth to be; some are lesser. I would not want to push the local universities to try to be as liberal as possible just for the sake of competing with everyone in the marketplace of universities abroad. I think it is something they have to consider very hard. But this is something that is best

not decided by the Ministry but by NUS, NTU, SMU themselves.

7. Mr Leong Horn Kee asked the Minister for the Environment and Water Resources, in view of the recent sharp increase of dengue fever cases, what concerted actions have been taken or are being planned nationwide to fight against this health hazard.

Mr Speaker, Sir, Singapore, like the rest of the region, experienced a resurgence of dengue fever over the past few years. In 2003, there were 4,788 dengue fever cases and, in 2004, the number of cases increased to 9,459. Although we saw a significant drop in the number of cases from an average of 294 per week in January to 125 per week in April this year, the number has risen as we entered the period of warmer weather and intermittent rain. The number of dengue fever cases has exceeded 300 cases per week in July. We, therefore, have to be extra vigilant and step up efforts to tackle this problem.

Let me briefly explain what NEA does. NEA has a pre-emptive surveillance system to keep a check on dengue-prone areas. They have worked with the construction industry, schools and condominium management to put in place mosquito control programmes. These programmes have thus far been effective in controlling mosquito breedings in these premises.

Today, whenever a dengue case is reported, NEA will immediately move in to search for all mosquito-breeding sources and destroy the mosquito larvae in the vicinity of the patient's home. NEA will also fog the area when there is an upsurge of adult mosquitoes. The purpose is to reduce the population of mosquitoes so as to prevent further dengue trans

missions. In addition, should there be more than one dengue case detected in the same area within two weeks, NEA will classify the area as a dengue cluster, and deploy additional manpower to intensify the search-and-destroy operations. Today, it is an SOP on the ground for NEA to alert the MPs, CCC and RC chairmen as soon as a cluster is found. NEA will also proceed to mobilise the grassroots volunteers to help spread the dengue prevention message to households in the neighbourhood affected. This is a tested approach and, by engaging the community, NEA has been able to keep most of the clusters small and close them within the targeted 14 days.

Sir, NEA will deploy more manpower to step up checks on mosquito breeding in residential areas, particularly in areas prone to dengue. However, these efforts by NEA alone are not sufficient to tackle the resurgence of dengue fever. Our greatest challenge is with individual households. We need the active involvement of the community to reduce and keep the number of dengue cases to the lowest level possible. Today, with all the publicity given to dengue fever, most householders are aware of how to prevent mosquito breeding. Unfortunately, many of us have yet to put our knowledge into action. We need the cooperation of each and every household to check for and remove stagnant water. We need to do this at least once a week in order to deny the Aedes mosquito a place to breed in our homes.

Sir, in April last year, we launched the Mozzie Attack programme. We have since been receiving good support from the grassroots organisations and volunteers. In fact, I am happy to say that, as of now, all the 84 CCCs have put in place their own Mozzie Attack Programmes. What is even more encouraging is that the number of dengue prevention volunteers has also doubled from 2,000 last year to 4,000 this year.

In the past four months, NEA and the various grassroots organisations and CDCs have been working on various new approaches in dealing with dengue. For some CDCs, our Mayors have come out personally to declare war against dengue. Let me cite a few examples: North East CDC's plan to 'smoke out' dengue from North-East district by supporting a series of outreach programmes in 2005, South West CDC's launch of 'My Environment Shines' Campaign in April 2005, which included efforts to reach out to residents with tips to prevent mosquito breeding in their neighbourhoods, and the use of specially designed "dengue alert tags" by the South East CDC grassroots leaders and volunteers to warn households of potential breeding habitats.

We are very encouraged by the efforts of the CDCs and grassroots organisations and will work even more closely with all our CCCs. NEA has set aside $5,000 for each CCC and $50,000 for each CDC per year to fund part of their community outreach programmes. I hope that grassroots organisations will find this funding timely and helpful in their ongoing dengue prevention programmes.

This year, besides providing funding to grassroots organisations, NEA has also intensified its public awareness and outreach efforts. Since May this year, pamphlets to raise awareness of dengue fever are made available at all GP clinics in Singapore. A new series of posters are being displayed at lift lobbies of every HDB block and condominium. And since March, NEA started putting up dengue prevention posters at more than 400 bus-stops to reach out to residents in dengue-prone areas.

Over the last few weeks, NEA has further extended this publicity effort to reach out to more commuters. These included dengue advertisements at some 200 bus shelters, inside MRT trains and Bukit Panjang LRT trains, as well as at MRT stations where there is high human traffic.

Over the last two weeks, NEA also proceeded to conduct briefings to 84 CCCs and 16 Town Councils to provide detailed updates on local dengue situation, urging them to step up on preventive measures and help spread the dengue message to their residents. In fact, next month, NEA plans to distribute a new set of dengue educational kit specifically designed for the 70,000 families living in landed homes, to remind them on what they can do to reduce mosquito breeding sources, such as roof-gutters, within their premises.

Sir, my Ministry will do all that is within our means to ensure that dengue fever remains under control. However, the success of dengue prevention programmes hinges heavily on community participation. Only with the active participation of every householder will we be able to reduce the number of dengue cases to the minimum.

Sir, I am pleased to hear that the Minister is making a very concerted effort. I am afraid I still feel that more can be done. In my view, instead of a Mozzie Attack, it is currently more like a Mozzie Defence. So we should go into an attack. For example, contrast against the way we treat SARS, I do not know how much we spent on the whole SARS programme. But let me ask the Minister, in the case of this dengue programme, how much of the total budget has been devoted for the programme and can more be allocated for us to actually eradicate this particular nuisance? First, is the budget. Second, can more teeth be given to the inspectors and the Ministry because a lot of these problems are coming from, like what the Minister said, the fault of the residents? In my constituency, for example, I am hearing about more dengue fever cases than before. So I think it really needs an all-out attack to solve this problem. Could we

give more teeth to things like the building control practices, whereby maybe gutters should not be allowed in certain cases, so that there is no room for mosquitoes to breed? We know that palm trees, for example, collect water and, therefore, are prone to dengue spreading. Also, ---

Mr Leong, that is a very long supplementary.

I have two more supplementary questions. I have just asked two questions. One is on funding and the other is on teeth. The third question is whether we could have more prevention, like the Minister needs more money for fogging and oiling of the stagnant water, maybe more can be done in that area. And, finally, more money for education. As the Minister has said, education is a very important factor. Perhaps, he can do more on that aspect.

Sir, the short answer is yes to all the queries. We have increased the budget this year. As I have mentioned in my reply, $5,000 to each CCC and $50,000 to each CDC. We will evaluate whether or not more money will be needed to do the programmes on the ground.

On more teeth, yes, we are giving our officers a bit more resources and, in fact, we do come down hard on people who have been caught the first time. In the past, we gave them a warning. Now, we are relooking at whether we should penalise them.

On more prevention programmes, I agree entirely with him. But the example he cited in the case of gutters, we found this to be the problem in some of the older landed properties and we do encourage the owners to either remove it or do periodic checks because gutters are one of those structures that attract mosquitoes, unless they design them properly. We have seen some design

whereby there is a filter on top of the gutter that will catch debris and only allow water to flow through. So there are ways in which you can improve this, and this is something which we would like householders to consider.

Public education is a campaign that we step up this year. You have seen some of the posters at the bus shelters and MRT stations. So the bottomline is that we are prepared to spend more and tackle this problem. But, ultimately, as I mentioned in my reply, there are two important variables. One, of course, is the weather, which we cannot control; secondly, is the behaviour of the householders. Ultimately, he or she would have to do his or her best to inspect the possibility of water being trapped. We cannot ask Singaporeans not to plant plants in their homes. But if they want to do that, they should be more responsible. So the public education campaign is very important, to ask Singaporeans to do their part, especially when there is a heavy rain and after which, there is a dry weather. These are conditions which are very suitable for the Aedes mosquitoes to breed and to increase their population.

Sir, with regard to this particular species of mosquitoes, since all our efforts are directed at urban breeding areas, do these mosquitoes, for example, breed in green areas near urban centres and, if so, do they peregrinate into the urban centres and, if they do, do we have any programmes to deal with that? Because we may succeed fighting the urban war but we may not succeed in actually preventing this particular problem.

I am not familiar with the science behind all these things. What I know is that the mosquitoes need human blood in order for them to procreate. It feeds on, for example, sugar just for its own energy, but it needs the human blood in order for

it to procreate. So it has to go into where there is human population in order for it to procreate. As to whether we have found instances of mosquitoes breeding in our parks, we are in close contact with NParks and the authorities responsible for managing our parks, to work closely to ensure that there are no natural habitats for the mosquitoes to breed. But as to whether they migrate from our green parks of the country to urban areas, I am not able to answer that question. But I am most happy to check and reply to him on that.

Mr Speaker, Sir, two supplementary questions. Would the Minister give us a better idea on the causes, areas and locations? Is he able to give us statistics on how many of these cases are from HDB flats and how many are from the landed properties and, within the landed properties, how many are actually due to the containers within their households or within their compound itself, or how many are due to the building structures, like gutters?

Sir, I do not have the exact breakdown. But the figures that we have show that we have clusters within HDB estates and we do have clusters among landed properties. But in the case of HDB estates, we work very closely with the Town Councils who had been very helpful in making sure that in the public areas where Town Councils are responsible, they will check diligently. It is within the HDB flats where we need to work with the local constituents, the MPs and RC chairmen to educate the households to make sure that they check. For landed properties, it is a challenge. We also work with the local MPs, but we go house-to-house whenever there is a need to check. What is more important is for the public to be aware that they have a role to play, whether or not you are living in a landed property or HDB flat, if you have a puddle of water which is

neglected, that will be attractive to Aedes mosquitoes and, therefore, they will start to procreate and then it will become a problem.

The second question she asked is whether the instances of the breeding are basically from the containers. Most of them tend to be from the containers. For example, we have found in the flower pots, gutters, in the common areas managed by the Town Councils, even in places where you have installation, such as the pump room, where there was a water leakage in one instance and the water puddle was small or large enough, depends on how you look at it, for the mosquitoes to breed. So our message to all households and property owners is that they have to check constantly, especially during this time of the year when you have a warm weather, with intermittent rain. These are ideal conditions for the mosquitoes to breed.

8. Dr Geh Min asked the Minister for the Environment and Water Resources whether Singapore's delay in ratifying the Kyoto Protocol will damage our international reputation and credibility as a responsible member of the global community.

Sir, climate change is now regarded as a key environmental challenge confronted by the global community. There is a need for concerted efforts to reduce greenhouse gas emissions. As an island state, Singapore shares this global concern, and is supportive of the various international efforts taken to address this challenge.

Sir, the Kyoto Protocol (KP) is an international agreement that reflects the

parties' commitment to addressing climate change. It is a protocol to the United Nations Framework Convention on Climate Change (UNFCCC). Singapore ratified the UNFCCC in 1997. The KP entered into force in February 2005, and legally commits 39 Annex I parties, covering mostly developed countries, to reduce their greenhouse gas emissions by an average of 5.2% below the 1990 levels by 2008 to 2012. For non-Annex I countries, including Singapore, there are no emission reduction targets set for them under the KP.

Nevertheless, we have been consulting and working closely with the various stakeholders to come up with realistic and viable climate change solutions. Examples include our first Roundtable on Climate Change in May 2005 which involved representatives from industry, academia, NGOs and the media, as well as our current review of the Singapore Green Plan 2012.

Sir, we agree that acceding to the Kyoto Protocol would be consistent with Singapore's image as a responsible international citizen with a reputation for good domestic environmental practices, and we are now reviewing the timing of our accession to the Kyoto Protocol.

Mr Speaker, Sir, it seems to me that climate change is wider than just a local environmental problem. Other countries have addressed it on a national level. The Prime Minister of Britain has again stated that it would be one of his priorities just after his re-election. May I ask the Minister if this issue is being dealt with on an inter-ministerial level or is it only just the Ministry of the Environment and Water Resources which is looking into it? It seems to me that Ministries like the Ministry of Foreign Affairs and the Ministry of Trade and Industry would be very much involved in decisions on climate change.

Sir, again, the answer is, yes, this is an important piece of commitment by the Singapore Government, so it has to be taken at the Government level. We have been consulting other agencies, such as the Ministry of Foreign Affairs and the Ministry of Trade and Industry. I think Dr Geh Min is aware that the Ministry, of course, while taking the lead, has brought on board all the various agencies to discuss a climate change programme that we can adopt as a country in Singapore. So, it has to be a comprehensive effort. The Ministry has been responsible primarily because it has come under MEWR, but we have been working closely with the other Government agencies. When we decide to accede to KP, it is not MEWR's decision but it is the decision of the Singapore Government and, therefore, all the agencies responsible will have to play their part.

Sir, is there any framework within which these Ministries are working, and when is Singapore likely to accede to the Kyoto Protocol?

I will take Mr Khaw Boon Wan's answer yesterday, in due course. As to the hon. Member's second question, we are studying the timing.

Regarding the hon. Member's first question, as I mentioned earlier, we are putting together a framework that will help not only MEWR but also the various agencies responsible. Let me just cite a very simple example. My Senior Parliamentary Secretary, Assoc. Prof. Koo Tsai Kee, chairs an inter-Ministerial committee that looks at energy efficiency for our buildings and other infrastructures in Singapore. So, certainly, there is a framework that is being put in place that will involve all the relevant agencies.

9. Mdm Ho Geok Choo asked the Minister for National Development if he will provide a status report for the last three years on the number of flat dwellers who have (i) downgraded or sold their flats for rental flats and (ii) asked for their mortgage loans to be restructured.

(for the Minister for National Development): Mr Speaker, Sir, the number of HDB lessees who sold their flats and moved to a smaller new or resale flat was 6,000 in 2002, 4,700 in 2003 and 4,200 in 2004. The number of HDB lessees who sold their flats and were allocated a subsidised rental flat from the HDB was 1,300 in 2002, 1,400 in 2003 and 1,900 in 2004.

To help HDB mortgagors who are in financial difficulty, HDB allows them to restructure their loans by several methods:

extending the loan repayment period;

reducing or deferring the payment of loan instalments;

including working family members as co-owners of the flat to help pay the mortgage loan instalments; and

paying the mortgage loan arrears by instalment.

In 2002, HDB approved 23,000 applications for financial assistance from HDB mortgagors. These include both new and renewal cases. The corresponding numbers were 35,700 in 2003 and 40,200 in 2004.

Mr Speaker, Sir, can I ask whether these people who sold their flats in the last few

years and who were allocated rental flats, were they allocated the flats immediately after they sold their flats or did they have to wait out the 30-month debarment period?

Mr Speaker, Sir, HDB rental flats in Singapore are targeted at helping the families who have financial difficulty in buying a flat of their own, and they are built and rented out on a highly subsidised basis. So, because of this, we try to manage competition for this limited stock of highly subsidised flats. Accordingly, the policy has been to have a waiting period of 30 months for people who have sold their HDB flats and then want to apply to rent a HDB flat from the HDB.

In cases where there are special circumstances - as all MPs know, we have constituents who approach us and we make appeals for them - each case is looked at on its own merits and, where the situation warrants it, exceptions have been made.

How can a divorced mother, who was a housewife and a co-lessee in the matrimonial home before the divorce, go about applying for a subsidised flat and a concessionary loan in the event of a divorce so that she can continue to maintain a family nucleus because she has the custody of the children? In this instance, how can she go about getting the new flat immediately without having to wait for 30 months?

Mr Speaker, Sir, first I would like to reiterate that every case of appeal will be studied and looked at on its own merits. For example, not every woman who is divorced is necessarily in financial difficulty and, therefore, the urgency that applies to each case would also differ. So, I would go back to saying that the HDB and the

Ministry of National Development look at every case on its merits, and we have made exceptions to the waiting period as well as to the application for the second concessionary loan, depending on the financial situation and other surrounding circumstances of each case.

May I remind Members that we have a lot of questions to go through. So, I will allow one more last question. Dr Wang.

Sir, I would like to ask the MOS, of the people who have been given rental flats over the last three years, how many of them are the "exception" cases that he has mentioned?

I do not have the precise figures with me here, but I can assure Dr Wang as well as other Members of this House that, every day, I see many of these appeal cases with the facts and the recommendations, and I can testify to the fact that the HDB looks at every such case and they are willing to put up these cases for deviation, ie, approval, to waive those waiting periods, and allocate the rental flats without requiring the person to wait out the 30-month normal waiting period. And I do approve many of them, practically on a daily basis. But if you would like the precise number, I could find that out for you.

Just a rough figure. 10%?

I would rather say something that is more precise. I will get the number.

Very last question. Mr Tan.

Would the Minister of State not consider relooking at the 30-month debarment period to make it easier for people who wish to rent a flat

after selling, because most of these people simply cannot keep up with their mortgage payments? If you debar them for 30 months, you are just depriving them of a home, and many of them come to us and say, "Look, where do I stay after I sell my flat? Where do I stay for the next two and a half years?" So, I think it is time for the Ministry to relook the rule.

Mr Speaker, Sir, I think we have got to distinguish between trying to address the needs of a particular group who, for example, after divorce and selling their matrimonial flat and are in financial difficulties and find that the alternative ways of staying with family or renting a room outside, perhaps find it is not possible for them, these are very specific circumstances. But we should not then generalise and say that every household which sells its flat and wants to rent from the HDB is necessarily of these circumstances. So, what I would like to assure Members is that, when we receive the appeals, we look at these cases on their merits, and we have made exceptions from this policy. But I would not want to go and change the entire policy and say that if anybody were to sell his flat and come to the HDB and say, "Now I want to rent one from you", that we would then say, "OK, please join the queue" and intensify the competition with the other group who are generally of lower income who really need this kind of subsidised rental flats and we want to help them this way. So, I think it is a question of how we manage between these two sources of demand, by flexibly taking into account the circumstances of each case.

10. Mr Zainudin Nordin asked the Minister for National Development in view

of the recent incident of a lady who fell from the flat balcony while hanging clothes and our aging population, (a) what measures are being introduced to prevent such incidents from recurring; and (b) whether the Housing and Development Board is exploring newer, efficient, senior citizen-friendly and safer designs for future flats.

Mr Speaker, Sir, there are two main types of clothes drying systems in HDB flats, namely, the pipe socket clothes drying system, ie, the one where you stick the bamboo pole into, and the recessed clothes drying system, which is the one that, for example, after a Main Upgrading Programme, you will find them being constructed between two space-adding items. Both these systems are safe to use as long as the users are careful and take the necessary precautions when hanging out their clothes. For example, residents should not overload the bamboo poles. Those who prefer not to use the bamboo pole holders can install retractable clothes drying racks. Alternatively, they can dry their clothes indoors by using the clothes drying racks provided in the kitchen.

HDB has piloted a new parallel clothes drying rack system in some new flats. Under this system, the poles are fixed in place and parallel to the façade of the flats. If successful, the HDB will consider implementing this system for all new flats and also for existing flats undergoing upgrading.

11. Dr Amy Khor Lean Suan asked the Minister for National Development (a) if he will provide an update on the proposed

mandatory licensing scheme for contractors and specialist contractors announced by his Ministry; (b) what are the likely criteria for the licensing of these firms; and (c) when will this scheme be implemented.

Mr Speaker, Sir, my Ministry announced the proposed contractors licensing scheme two months ago. The objective of the scheme was to raise the level of professionalism of builders in Singapore.

The intent is to require those contractors who undertake works that needed building control approval, and specialist contractors who undertake works that have a significant impact on construction safety, to be licensed.

Details of the licensing framework are still being worked out. BCA has been consulting with and gathering feedback from the industry, and will consider views and suggestions from the industry.

The licensing criteria for the builders are likely to include such requirements as the adequacy of management structure, safety record and financial strength. For example, firms will need to appoint qualified and experienced persons in two key management positions, namely, an Approved Person (AP) who will be responsible for the management of the firm, and a Technical Controller (TC) who will be responsible for

the supervision of construction works. Both the AP and TC will need to have some formal educational qualifications, and at least 3-5 years working experience in construction projects. The AP may also need to be a director of the firm. The detailed qualifications for the AP and TC are still being finalised.

In the case of specialist contractors, due to the specialised nature of their

works, the qualifying criteria for a licence are likely to be higher. For example, the key personnel may need to have at least a university degree that is recognised by the Professional Engineers Board, and at least five years of relevant working experience.

At the same time, we recognise that that there are existing contractors who may not meet fully these qualifying criteria, but have adequate experience in the industry. For such contractors, we can consider transitional provisions, such as mandatory training in lieu of formal qualifications, to enable them to be licensed within a grace period.

The Building Control Act will have to be amended to implement the contractors licensing scheme and the additional proposals that came out of the construction safety review following the Nicoll Highway incident, eg, the recommendations pertaining to deep excavations. The Bill to make the necessary amendments to the Building Control Act is likely to be ready by the end of the year. It will be introduced early next year.

Mr Speaker, Sir, I would like to ask the Minister of State if there will be a period for consultation as regards the draft criteria in the Bill. Who is the Ministry consulting at this point in time? Would all relevant stakeholders, not just the contractors, be consulted as regards the criteria as well as the training that may be required for the people who are checking on the specialist contractors? For those who may not qualify under the criteria, are there transitionary provisions provided for them to get the required training?

Mr Speaker, Sir, because this concerns the licensing of contractors, certainly the Singapore Contractors Association (SCAL) has been consulted and they are still being consulted on this. At the same time, other associations related to the construction

industry, I would imagine that BCA would also be in touch with them, if not already so, and would also value their inputs and suggestions.

In this regard, relevant associations are certainly welcome to provide their inputs. As I mentioned, this is still in the discussion stage and the Bill will only be ready at the end of the year and will only be tabled in this House early next year. So during this period, BCA will undertake these consultations.

12. Mdm Cynthia Phua asked the Minister for Transport what is the situation given that more taxi drivers are unable to earn enough to pay for their monthly rentals.

Mr Speaker, Sir, the taxi companies have confirmed with MOT that some of them have experienced a slight increase in the number of taxi drivers defaulting on the payment of rentals. However, the overall default rates are still fairly low, ie, less than 1% per month. I was also given similar feedback in my recent dialogue session with representatives of the taxi associations. They informed me that they now need to work harder to maintain their previous income levels.

Sir, the data from the taxi companies has also showed that the average gross monthly income of taxi drivers has actually improved from $5,440 in 2002 to $5,780 this year for a single shift operation. For a two-shift operation, it has increased from $7,290 to $7,940. However, the average net monthly earnings over the same period have declined from $2,230 to $1,880 for a single shift, and from $3,800 to $3,580

for a two-shift operation. This is due largely to the cumulative 48% surge in diesel prices over the past two years. Diesel costs now account for 34% of total operating costs compared to only 25% in 2003.

The taxi rental charge is the other major cost component for a taxi driver. However, we have checked and confirmed that taxi rental rates have remained fairly stable.

Sir, taxi drivers operate as partners of taxi companies. As such, the taxi companies will need to ensure that their rentals and their drivers' income remain competitive. Only then can they recruit enough taxi drivers to ensure that their taxi fleets are well-utilised. In line with this, taxi companies have provided various financial incentives and reliefs to their drivers over the years. For example, Comfort, CityCab and Yellow Top Cab provided a special one-time bonus to their drivers early this year. The special bonus ranged from $240 to $360 per driver, according to the number of years of service. SMRT Taxis had also recently given its drivers a $380 diesel relief bonus to offset the high cost of diesel.

However, such help has only gone a small way to offset the huge increase in fuel costs. As taxi fares have remained largely unchanged for the past five years, in effect, the taxi drivers have had to absorb this large increase in fuel costs, instead of passing it on to the passengers. Three of the taxi companies have recently increased the telephone booking fee for peak hour bookings, but have left the taxi fares unchanged. This will help to increase the incomes of their drivers. But I am not sure if this will be enough to offset the increase in fuel costs. However, as the taxi industry is now fully deregulated, it is up to the companies to decide on what is the appropriate taxi fare level that will allow their drivers to earn a

reasonable and competitive income and at the same time, attract enough customers.

13. Ms Indranee Rajah asked the Minister for Home Affairs what is the outcome of the police review of its operating procedures in relation to the transportation of suspects which was conducted after the escape from custody of the two suspects, Tok Poh Oon and Thangavelu Velu.

Sir, first, let me assure Ms Indranee Rajah that the Ministry of Home Affairs takes the safe and secure custody of accused persons very seriously. Police and the other enforcement agencies have thoroughly reviewed each incident and have improved their operating procedures to prevent recurrences of such incidents.

The two incidents involved Thangavelu Velu and Tok Pok Oon. In the case of Thangavelu Velu, he was an illegal immigrant who was, together with 30 other accused persons, being escorted on 8th June to the Subordinate Courts. The escorting officer had released Thangavelu's handcuffs when another accused person, who was in a chain handcuff with nine other persons, requested to switch positions to facilitate the carrying of that other person's bulky luggage. After making the switch, the ICA officer unfortunately did not put the handcuff back on Thangavelu. After Thangavelu alighted from the vehicle, which was parked in front of the ramp leading to the basement lock-up at the Subordinate Courts, he fled.

As for Tok Pok Oon, he was a remandee at the Queenstown Remand

Prison, who on 10th June, managed to escape from Police's custody after his return from the Subordinate Courts. He was brought to the Subordinate Courts to answer to a charge against him by the National Environment Agency. I am unable to say more on the circumstances of his escape as the case against Tok for escape from legal custody is still pending.

But, Sir, in reviewing these cases, we have identified some weaknesses in our standard operating procedures. Police and the other enforcement agencies have already taken steps to rectify them. A key weakness was that different categories of persons in custody wore the same attire, regardless of their status. To rectify this, Prisons has implemented a colour coding scheme, so that those who are charged with a capital offence as well as those who are required to return to Queenstown Remand Prison after their court appearance would be clearly differentiated by their attire. In this way, the escorting officers will be able to quickly and easily identify the different classes of persons in their custody and take the necessary security measures to prevent escapes.

In the case of Thangavelu, the bus that ferried him and other accused persons that day was not able to enter the secured area of the Subordinate Courts due to infrastructural constraints. Police has since tightened this procedure. Now, enforcement agencies transporting persons in custody to the Subordinate Courts are required to use smaller vehicles that would enable the unloading of accused persons to take place within the secured area.

Sir, our investigations have revealed that human error was a key contributing factor that led to the escape of Thangavelu and Tok. The officers concerned are currently under investigation. If the officers are found to be

negligent, they could face internal disciplinary action or prosecution in Court.

Other than plugging the weaknesses that these two cases have surfaced, MHA and the Home Team agencies will continue to study how the process of moving persons in custody can be further strengthened in areas such as operational procedures, equipment, training and supervision.

14. Mr Alexander Chan Meng Wah asked the Minister for Community Development, Youth and Sports given the recent reported drownings of youths during recreational swimming activities, (a) whether the Minister can provide statistics of deaths by accidental drownings for the past several years; and (b) whether there is a trend towards more such drownings.

Sir, there was an average of 17 cases of drowning per year between 2001 and 2004. 41% of these drowning incidents occurred at the sea or near beaches. A further 13% occurred in rivers while swimming pools and reservoirs accounting for 10% each. Every single death by drowning is one too many. What is especially tragic is that each one is potentially preventable.

Therefore, a holistic and comprehensive approach is needed to address this problem. MCYS and the Singapore Sports Council (SSC) are working with the relevant agencies which include MOE and the Ministry of Health to do three things. First, to enhance public education about the danger of swimming in inappropriate locations. Second, to increase the safety of swimming facilities. And third, to encourage more young people to learn how to swim.

A childhood injury prevention programme under the Health Promotion Board of the Ministry of Health has been emphasising water safety in its preventive and public education outreach programmes. Some of you may have seen the advertisements carried in the newspapers over the past couple of weeks.

For 2005, the theme is "safety-at-play". This is aimed at disseminating swimming safety tips to parents, caregivers and children through direct public educational programmes, such as road shows, exhibitions, educational public shows, seminars, talks, interactive exhibits and games activities. The Health Promotion Board has also published advertisements.

The SSC has implemented various water safety measures at its public pool facilities. For instance, it displays safety regulations prominently and advises pool users to exercise proper care. We also have in place emergency rescue plans, daily inspection of the pools and the safety equipment, rules on the ratio of students to swimming instructors as well as ensuring that there are adequate trained lifeguards on duty at all times.

By the end of August, every swimming pool will have a defibrillator and staff would have been trained on how to use it. I have also asked the SSC to work with the relevant agencies and partners, including the Singapore Lifesaving Society to consider other measures to improve swimming safety in private pools and other water bodies.

At the same time, SSC is also looking at encouraging more youths to learn how to swim. If a person is able to swim, the chances of him drowning are that much less. The SSC is working closely with the MOE to encourage schools to make greater use of the SSC's pools for swimming lessons and we will also be

working closely with the Singapore Swimming Association to encourage more Singaporeans to take up swimming.

My Ministry and SSC will work with all the relevant stakeholders, both in the Government and people sector, to adopt a holistic and comprehensive approach to prevent this needless tragic death.

3.00 pm

Order. End of Question time.

[Pursuant to Standing Order No. 22, Written Answers to Question Nos. 15, 17, 21 and 27 on the Order Paper are reproduced in the Appendix*. Question Nos. 16, 18-20, 22-26 and 28-33 have been postponed to the sitting of Parliament on 20th July 2005.]

* Cols.

Mr Speaker, Sir, over the past few years, the Government has implemented several key policy changes related to the property market. These included adjustments to the CPF Ordinary Account contribution rates and cash downpayment requirements, and limiting the amount of bank financing for the purchase of private residential properties. We also capped the amount of CPF that could be withdrawn to purchase properties using bank loans.

Such re-tuning of policies from time to time is necessary to ensure their continued relevance to broader social and economic objectives. These objectives include enhancing Singapore's cost competitiveness, ensuring retirement

adequacy for an ageing population, and maintaining a healthy financial sector.

These changes in CPF policies, mortgage financing rules, and policies relating to home ownership affect the property market, in one way or another. As such, we need to ensure that the rules set will foster the free and undistorted functioning of the property market. It is in our interest to ensure that the property market is stable and that it is consistent with economic fundamentals, as it affects home ownership, asset values, retirement savings and the health of the banking sector.

So far, the various CPF, home ownership and mortgage rules have been introduced at different times to fulfil various objectives. Hitherto, we have not comprehensively reviewed all of them together. We have thus decided to do a holistic review of various property-related policies, and implement them as a package. This way, we can provide stakeholders in the market with a complete picture, and ensure that the measures are consistent with one another.

The review has covered three major areas, namely, first of all, caps on bank financing for residential properties; secondly, limits on the use of CPF for property purchases; and, thirdly, restrictions on foreign ownership of lands and properties.

Let me stress that the purpose of the changes is neither to boost nor depress the property market. Rather, the review is to improve structural rules in the above areas to improve the functioning of the property market, and to better achieve broader economic and social objectives in today's context. Some of the measures introduced will have a positive effect on the property market, while others may have a dampening effect. The net effect will depend on many factors, many of which are beyond these measures. We

believe that with prudent and realistic decisions, the market will find a new equilibrium that will be based on economic fundamentals.

The Government Ministries and agencies involved in the review include the Ministries of Law, Manpower, Trade and Industry, and National Development, as well as the Central Provident Fund Board, Monetary Authority of Singapore, Economic Development Board, Singapore Land Authority, Housing and Development Board, and Urban Redevelopment Authority.

I will now proceed to elaborate on the measures that will be put in place in the next few months. Details of these policy measures will be provided by the respective Government agencies separately.

Raise LTV limit for housing loans from 80% to 90%

Sir, let me first deal with our mortgage and financing policies. The first of these measures is the raising of the Loan-to-Value (LTV) limit for housing loans. MAS introduced the 80% LTV limit for bank-originated housing loans in 1996, together with the Government's package of measures to cool the private property market. The 80% LTV limit was intended not only to counter the market overheating at that time, but also to ensure sound bank lending practices across property market cycles. The 20% payment by borrowers provided a buffer for banks in the event of a property downturn. This was particularly important as bank loans at that time ranked second behind borrowers' own CPF claims on mortgaged properties.

In 2002, the priority of claims over properties was changed so that banks now held the first charge for the property ahead of CPF. It has been three years

since, and the market has had sufficient time to adjust to this change. Currently, over two-thirds of banks' outstanding housing loans are secured by first claims over properties. MAS is now ready to increase the housing financing limit to 90% of the property value. The remaining 10% which the purchaser has to pay will continue to deter over-borrowing by purchasers and minimise potential losses by banks arising from borrower default. However, to mitigate the increased risk that banks will take, MAS will require banks to hold more capital against housing loans which exceed 80% of the property value. MAS will also expect banks to apply rigorous internal credit evaluation criteria before extending high LTV loans. In some countries, mortgage insurance is available to insure lenders against the risks of high LTV loans. MAS is prepared in-principle to consider mortgage insurance as an alternative to the capital charge to mitigate the risks of high LTV loans. However, mortgage insurance is not yet available in Singapore. MAS will be studying its viability here and how best to regulate mortgage insurers.

HDB will similarly raise the loan limit for its flat buyers from 80% to 90%. The actual loans to be granted will be subject to the banks' and HDB's credit assessment and mortgage financing policies.

Limit minimum cash payment required for residential properties at 5%

Sir, another revision to the housing loan rules in 2002 was the reduction of the cash payment for private residential properties to 10% of its value, down from 20% previously. The Government will now lower the cash payment for private residential properties from 10% to 5%. This means that a purchaser who is granted a 90% loan for his housing unit can pay his remaining 10% through a combination of at least 5% of the

property value in cash, and the remaining with CPF.

For HDB flats financed with bank loans, the payment to be paid in cash is currently 4% and it is slated to increase gradually to reach 10% by the year 2008. In line with the reduction in the cash payment for private residential properties to 5%, the Government will adjust the cash requirement for HDB flats financed with bank loans to 5%, instead of to 10% that was initially planned.

The raising of the LTV limit will take immediate effect and will apply to all properties purchased from today. The 5% cash requirement for private properties will take immediate effect, while that for HDB will apply to flats purchased from 1st January 2006.

These changes will give consumers a wider choice of financing options when purchasing a property. However, I urge property buyers to continue to exercise prudence in their home purchase and financing decisions, and to ensure that they can comfortably afford the expenses involved.

Central Provident Fund Policies

Sir, I will next deal with Central Provident Fund policies. The CPF Board will streamline its policies to increase flexibility for the use of CPF savings to purchase property, while ensuring that adequate sums are put aside for retirement needs.

Reduce Minimum Lease Period (MLP) for use of CPF savings

The first policy change is to allow the use of CPF savings to purchase private residential properties with shorter leases. Currently, CPF members are allowed to use their CPF savings to purchase private

residential properties only if these properties have remaining leases of at least 60 years. This is to ensure that the lease can last the average life expectancy of buyers. This policy intent is still valid, but older members can also meet this objective when they choose to buy properties with shorter leases. The Government has therefore decided to allow CPF members to use their CPF savings to purchase private residential properties with remaining leases of 30 to 60 years. CPF withdrawal limits for the purchase of such properties will be pegged to the age of the purchaser as well as the remaining lease of the property. CPF will provide further details shortly. This policy change will take immediate effect.

Allow non-related members to jointly purchase private residential properties using CPF savings

The second change pertains to the purchase of private residential properties by non-related members. Currently, CPF Board does not allow non-related CPF members to use their CPF savings to jointly purchase private residential properties. However, non-related singles have been allowed to use their CPF savings to jointly purchase HDB flats. To align the treatment of private residential properties with HDB flats, the Government has decided to allow non-related singles to use their CPF savings to jointly purchase private residential properties.

This policy, which will take immediate effect, is expected to benefit singles who have been hitherto constrained by CPF regulations to share purchases of private residential properties.

Simplify the Available Housing Withdrawal Limit (AHWL)

The third change to CPF policies is to simplify the Available Housing Withdrawal

Limit (AHWL). The AHWL limits the amount of CPF savings that CPF members can withdraw for housing purchases. Currently, for CPF members below the age of 55 years of age, the AHWL is set at either 80% of the gross CPF savings in the Ordinary Account and Special Account in excess of the prevailing Minimum Sum, or the available Ordinary Account balance after setting aside the Minimum Sum cash component, whichever is lower. However, the current AHWL is complex and difficult for members to understand. Therefore, the CPF Board has simplified the requirement to set the AHWL only to the available OA balance after setting aside the Minimum Sum cash component. This will raise the AHWL for a small number of CPF members. This policy change will take immediate effect. Government's plans to reduce the CPF withdrawal limit for housing expenditure to 120% of the property's valuation limit by 2008 will remain unchanged.

Transfer Medisave Account (MA) overflows to Special Account (SA) or Retirement Account (RA) instead of to Ordinary Account (OA)

Sir, the fourth change relates to Medisave Account overflows. Currently, Medisave Account (MA) contributions which are in excess of the Medisave Contribution Ceiling, or the so-called "MA overflows", are automatically transferred to CPF members' Ordinary Accounts (OA), and these funds can be used for property purchases and other investments. To improve retirement adequacy for CPF members, the Government has decided to transfer MA overflows into the Special Account (SA) for members aged below 55 and into the Retirement Account (RA) for members aged 55 and above, instead of to the Ordinary Account. The interest rate for the Special Account and the Retirement Account, as Members know, is higher than that for the OA. This will benefit members and better

ensure adequate retirement savings for members.

However, as the savings in the SA and RA

cannot be used for property purchases, this could affect a small number of members who currently rely on their MA overflows to finance their mortgages in properties. CPF Board will allow existing mortgagors who have difficulty servicing their loans as a result of this measure to use their MA overflows to do so upon appeal, subject to conditions. This change will require the CPF Act to be amended and the effective date is set as 1st July 2006.

Impose restrictions on the use of CPF savings for multiple property purchases

The fifth CPF change concerns the use of CPF savings to purchase multiple properties. Currently, CPF members can use their CPF savings to purchase more than one property. To ensure that retirement needs are not compromised, the Government has decided that only the CPF savings in the OA in excess of the Minimum Sum cash component can be used for the purchase of second and subsequent properties. Members with inadequate Minimum Sum cash components will be allowed to use their CPF funds for the purchase of second and subsequent properties if they undertake to sell their existing property within six months from the purchase of the second property. For the second and subsequent properties, the amount of CPF savings that can be used for their purchase will be capped at 100% of the valuation limit of the property. This measure will take effect on 1st July 2006.

Phase out the Non-Residential Properties Scheme (NRPS)

The final change to CPF policies pertains to CPF Board's Non-Residential Properties Scheme (NRPS). Currently, the NRPS allows CPF members to invest their

CPF savings in non-residential properties such as office space, shops, factories and warehouses. Since members who wish to invest their CPF savings in properties can now do so by investing in property funds, instead of physical properties, the Government has decided to phase out the NRPS by 1st July 2006. Existing NRPS users will be allowed to continue to use their CPF savings to pay their mortgage instalments for non-residential properties.

CPF Board will release the details of the above six changes to CPF policies shortly.

Foreign purchases and ownership of residential properties

Sir, let me now turn to changes affecting foreign purchase and ownership of private residential properties and lands in Singapore.

Allow investment in private residential properties to qualify for PR status under EDB's Global Investor Programme (GIP)

Currently, under the Global Investor Programme (GIP) administered by the Economic Development Board (EDB), foreigners can be considered for Permanent Resident (PR) status if they invest a certain minimum sum in business set-ups and/or other investment vehicles such as venture capital funds, foundations or trusts that focus on economic development. Private residential properties, which had been allowed under the GIP, were removed from the list of allowable investment instruments under the scheme in 1996. The Government has now decided to re-allow investment in private residential properties. Under a new option to the current GIP, a foreigner can now be considered for PR status if he invests at least $2 million in business set-ups, other investment vehicles such as venture capital funds, foundations or

trusts, and/or private residential properties. Up to 50% of the investment can be in private residential properties, subject to foreign ownership restrictions under the Residential Property Act (RPA). This additional option will complement our efforts to attract and anchor foreign talent in Singapore. This policy change will take immediate effect.

Foreign ownership of residential properties under the RPA

Under the Residential Property Act (RPA), foreigners can buy restricted properties in Singapore only with approval. Restricted properties are landed properties or apartments in non-condominium developments of less than six levels.

The Government has reviewed the RPA rules and has decided to fine-tune the RPA rules in three aspects.

First, with immediate effect, foreigners can purchase apartments in non-condominium developments of less than six levels without the need to obtain prior approval. For landed properties, prior approval is still needed if they wish to buy. Landed properties is a special class of residential property that Singaporeans aspire to own, and therefore should remain restricted.

The second change concerns the exemption granted to some foreign companies from applying for a Qualifying Certificate (QC) when they purchase residential land for development. Under the RPA, foreign companies are required to apply for a QC. To obtain the QC, they must provide a Banker's Guarantee for 50% of the purchase price of the land as well as commit to the completion of the development in three to four years. The purpose of these requirements is to ensure that foreign companies do not hoard land or do not buy land for speculation.

Currently, a small group of foreign companies are exempted from these QC requirements. To level the playing field, the Government has decided to revoke the exemption status of currently-exempted foreign companies and subject all foreign companies to the QC requirements, with immediate effect. The existing land stock held by currently-exempted foreign companies will be given grandfather rights.

The third change concerns the requirements attached to the grant of a QC. We recognise that the QC requirements impose costs on businesses. To lower these costs, the Government has decided to reduce the required Banker's Guarantee from 50% to 10% of the land price. In addition, to allow foreign developers some flexibility to ride out unexpected changes in market conditions, the period allowed for completing developments is extended from the three to four years currently to six years. The Ministry of Law will release further information on these changes and their implementation dates separately.

Conclusion

Mr Speaker, Sir, let me reiterate that the policy changes proposed above are not intended to steer the property market in any direction. Some of the policy changes will have a positive effect on the property market, while others may have a dampening effect. The overall impact of these measures on the market may be positive or negative, but that is not the purpose of our review.

Rather the changes should be seen in their totality as a package, a package that will enable the property market to work better, and that will enable it to find its own equilibrium based on firm economic fundamentals. Some changes are refinements of rules put in place in earlier reviews. Others are to remove provisions or controls that are no longer relevant, or

to introduce new opportunities. Where necessary, we have put in place adequate, but not excessive, safeguards. We will continue to review our rules and policies from time to time, and to change them if conditions change or unexpected situations arise. But I believe that these new policies, which lay the foundation for us to achieve longer term objectives, will be relevant through the ups and downs of the property cycle.

Mr Speaker, Sir, I will be pleased to answer any questions from Members, together with my colleagues from the relevant Ministries.

Order. I propose to take the break now. I suspend the sitting and will take the Chair again at 3.50 pm.

Sitting accordingly suspended

at 3.28 pm until 3.50 pm.

Sitting resumed at 3.50 pm

Debate resumed.

Sir, I would like to ask the Minister three questions. Sir, with your indulgence, first, I would like to thank the Minister for announcing this package of changes with the aim, as he noted, of streamlining many of the policies in the public and private housing markets, as well as help to lead to more efficient functioning of the property market. This would come as a very pleasant surprise to many property market players as well as potential investors. I think it would be a shot in the arm for the property market in general. But, Sir, I would like to ask the Minister why now. What is the rationale for implementing

these changes, and why now, especially at a time when some analysts believe that worldwide, except in Singapore, the property market is experiencing a bubble built-up and heading for a crash? Some of these changes seem to me to be a reversal of the Government's policy to ensure prudence in property investments. Does the Government believe that the property market is grossly underperforming here and this has a negative impact on consumption?

Sir, another question would be, why not implement these changes in phases? Why all at once? Sir, I would also like to ask the Minister, as the property market is already showing some signs of being on the mend and many of these changes are likely to boost demand, is the Ministry not concerned that these changes coming now may cause a more than desirable or unwarranted upsurge in property prices, thus impacting affordability in the medium and long-term and the cost of living, something we are all still very concerned with?

Sir, my final question relates to the non-residential property scheme. I would like to ask the Minister what is the rationale for doing away with the NRPS, since there are not many of such purchases. We should, in line with the current thinking, allow as many investment options and choices as possible and in effect, this may have a negative impact on the Government's encouragement for people to set up business because many of these people may have purchased the shops and office space for their own use.

Mr Speaker, Sir, first of all, let me thank Dr Khor for her remarks and support of the measures. She asked why now. As I explained in my Statement, these policy changes are as a result of several policy reviews made by

different agencies. They all are property-related policies. They have been introduced at various times to meet long-term social as well as economic objectives. If I may cite the CPF policy changes, the CPF policy changes have been introduced to meet the overall long-term objective which is to increase the flexibility for use of CPF but, at the same time, ensuring that the retirement funds are adequate.

The changes to the LTV limit and also the consequent lowering of the cash downpayment are also part of a broader review of the measures that were introduced earlier in 2002. The Residential Properties Act (RPA) changes are basically fine-tuning of some of the policies that are relating to the ownership of private and residential properties in Singapore. They are not meant to influence the property market one way or the other individually. But each of them would have some impact. They would have some influence on the market and that is the reason why the Government has decided that we will present this as one package, as a holistic package, to make sure that stakeholders, investors, buyers and property owners look at the whole picture and understand what are the various changes that we are making, and also, for us, as Government, to make sure that our policies are consistent with one another.

We will let the market adjust to these changes. All else being equal, perhaps the current set of policy changes on that basis would be positive. But the market depends on many other factors over and above these measures - the economic conditions, the supply and demand situation out there, the market sentiments, interest rates, people's own assessment of where they are heading as far as their jobs are concerned. So how all these will pan out will really depend on how individuals perceive their own situation. I have, in the Statement, also cautioned that individuals should continue to exercise prudence, to make sure that they

make purchases that are consistent with their own situation. But, collectively, as a result of all these policy changes, and as a result of all the individual decisions that arise from these changes, the market will find its new equilibrium.

Is it a reversal of the policy or philosophy of prudence that we have had? The answer is no. Even for those policies where there is a relaxation of some of the rules, like the LTV limit, the requirement for prudence is still there. Take, for example, the raising of the LTV limit from 80-90% for both bank and HDB loans. The banks and the HDB will continue to be required to exercise extreme care and prudence when they are assessing individual loans. They have to continue to impose credit assessment on their customers. They have to make sure that their customers are able to afford these loans, are able to afford the property and are able to repay the loans. In the case of HDB, over and above the credit assessment, buyers of HDB flats will be required to totally use up their CPF savings towards the purchase before they are able to get a HDB loan.

So, again, I stress that these measures are not a relaxation of our philosophy of prudence. We still require our banks and institutions to exercise prudence. But this is not inconsistent with what has worked, what we have done and, also, not inconsistent with what institutions in other countries are doing. And of course, MAS, as I said in the Statement, will be requiring the banks to have additional capital for the additional loan and will look into the issue of mortgage insurance.

On the market underperforming, again, I stress that the package contains a mix of measures which will be positive for the market and measures which will have a dampening effect. You could say that the raising of the LTV limit, the lowering of the cash downpayment, the relaxation of the restrictions on foreign purchases, all

these would be positive. But there are other changes as well that will have a dampening effect, such as the restriction on the use of CPF for multiple property purchases, or the NRPS, or the transfer of MA overflows into the Special Account or Retirement Account, instead of to the Ordinary Account. So we do not intend for these measures to move the market in one direction or another, neither do we have a position on what the final outcome of the market would be. We will leave it to the market to adjust to these factors and to find its own level.

Why not implement in phases? We have, at various times, implemented some of these measures for various purposes. We have decided that, since they are all property-related, we should present them in a package. The individual measures will be implemented as and when the consequential amendments to the legislation are made. Those that can be implemented immediately, of course, we have to, because these are market sensitive measures and we cannot wait.

But let me assure the hon. Member that, in so far as the whole package is concerned, these are put together as one holistic package in order to give property buyers, investors and the market a total picture of what the various measures should be.

Am I concerned about upsurge in prices which affect affordability? Whether there will be an upsurge in prices and to what extent, again, I am not in a position at this stage to predict. Again I stress, we do not intervene in the market to dampen or boost prices unnecessarily. But there are certain situations - and I think the hon. Member would know - for example, in 1996 when prices were running away, when the market was overheating and there was excessive speculation, the Government had to move in to dampen property prices. But that was an exceptional situation. As a general rule, we would not intervene in the

market. But, if the situation calls for it, then of course we will not hesitate to reintroduce some of the anti-speculative measures.

As to why are we doing away with the NRPS, perhaps I could ask my colleague, Dr Ng Eng Hen, to address this issue.

Sir, as the Minister for National Development says, this is a package of policy changes and not to move the market in any particular direction. There are a number of things we wanted to achieve.

First, we did want to facilitate home ownership and yet, at the same time, we wanted to facilitate for members to put aside enough for their retirement adequacy. For the non-residential property scheme, this does not really fit into our overall scheme of home ownership. These are commercial properties. The fact that there were a few participants made it easier for us to align this policy with our wishes and, therefore, we have decided to phase this out.

Also, there are other options for members, if they do want to invest in property-related stocks. We take that investment options are available and the framework of investments for OA and SA funds in the NRPS scheme does not feature greatly in terms of achieving our objectives.

Sir, I want to thank the Minister for this set of new measures. I support these measures, because I think they lead to liberalisation and a more fluid functioning of the market. I believe it will have some positive impact on the sector. In particular, I would like to mention that the change of the bank financing allowance from 80% to 90% is beneficial for our young

couples. Our young couples would now need to find less money. They need to raise only 5% of the required cash fund, instead of 10%, to be able to buy a property. I think that this is very commendable and I would like to support these changes.

I have a few questions for the Minister.

Firstly, the change to allow people buying HDB flats, with the cash portion to be reduced from 10% to 5%, the Minister said it will only be implemented on 1st January 2006 for HDB flats, whereas for private residential properties, it is to be implemented with immediate effect, why is there a difference in the time gap in their implementation?

Secondly, a point which I asked in Parliament before, why did the Minister not also review the resale levy for HDB flats? In the past, the resale levy worked well because the market had been continuously on the rise. But the market has been going through ups and downs, and the resale levy does impact on a purchaser. When he buys a second property, he has to pay a resale levy for the first property, and there may well be a mismatch between his ability to pay and the timing of the purchase. So, why did the Minister not review - at the same time while reviewing this set of policies - the resale levy for HDB flats?

Thirdly, the Minister mentioned about the liberalisation of purchases by two singles for private residential property. In the case of HDB, now it is also allowed for private residential property for two singles, but I think the limit is only for 3-room flats. Why does the Minister not allow 4-, 5-room and even Executive flats now to be liberalised for two singles to be able to buy them together and use their CPF to pay?

Finally, for foreigners being allowed to buy flats rather than landed property,

would cluster housing be included as those that allow foreigners to buy without seeking approval?

Mr Speaker, Sir, first of all, why do we not change the cash payment for HDB flats to 5% straightaway? Currently, they are paying 4%. It is scheduled to go up to 6% by 1st January 2006. This was part of the original plan when the goal was to go up to 10% by 2008. So, since the next stage is 1st January 2006, 6%, we have decided to stick to that timetable, but instead of making it 6%, we will cap it at 5%, same as for private property.

As for resale levy review, as I have explained in this House many times, the purpose of the resale levy is not to tax the individual. It is really a mechanism to claw back some of the subsidy that the Government is handing out for the second flat. Our current policy is a straightforward one. We will make sure that every Singaporean who is eligible is entitled to one subsidised HDB flat. It is heavily subsidised. He is free to cash out anytime he wants and keep the proceeds. However, if after doing so he wants to purchase a second subsidised flat, which also comes with a heavy subsidy, that is where we impose a resale levy. It is a mechanism, as I have said, to make sure that the distribution of the levy is equitable across-the-board. If he decides to buy a resale flat at market value, he keeps it. He does not have to pay a resale levy. So, the resale levy is not automatic upon the sale of a HDB flat. I think some Members may have this misunderstanding. So, why do we have a resale levy? We need to make sure that we claw back some of the subsidy for the second flat and, as a result of that, allow us to provide flats for genuine first-timers rather than those who are going for their second flat.

Purchase by two singles, why limit to 3-room flats? I believe we have actually

relaxed this, so that the joint singles scheme is no longer limited to the 3-room flats.

As for foreigners, yes, we have, because of the RPA changes, now allowed flats below six storeys to become unrestricted. But strata landed cluster housing will continue to remain restricted.

Mr Speaker, Sir, I heard the Minister said he does not want to comment on the impact of his package of measures on the market. But, being the decision maker, did he not anticipate the impact of this package of measures? Did he take a look at the market during the break? If he did, he would have found that the market has responded very positively. Did he not realise that all the heavyweights of the property counter have actually gone up substantially? In fact, I think the Straits Times Index has gone up by 33 points.

My concern is actually not so much on how the market responds, but the link between the price of commercial property and private property. Sir, do we recall that in the past, during the industrial recession that Singapore encountered, one of the factors of the cost of doing business is the cost of commercial properties? So, did the Government not anticipate that, with this adjustment, with this package of measures, the increase in property prices would render us, in this economic restructuring, even more difficult in view of globalisation?

Thank you, Dr Wang, for informing the House that the market has gone up. I am very happy for those who are involved in the market. But, as I said earlier, this package of measures was never intended to move the market in any particular direction.

The policy measures that we have announced today are derived from the

policy reviews made by many different Government agencies and Ministries. They all have their own rationale and reason behind it. The CPF review policies, as I explained, are not just to free up on the one hand the use of CPF for housing, but also to make sure that at the same time there is retirement adequacy. The LTV changes by MAS, there is a rationale for them in their own right. But we put them all together in one package today because we want to present this holistic picture.

Will the market for commercial properties go up? Indeed, if Members follow the market closely, you will realise that although there is a link theoretically between the two, the pace and the rate at which changes take place in different markets really depends ultimately on more fundamental issues like supply and demand. And so we see that, in the case of the commercial property market, when supply was very high, demand was low, the commercial property market was very weak. Vacancy rates were running very high in the Central Business District at a time when the other markets were not so weak, such as the retail market.

Similarly, in the current situation or in the last few quarters, you would have noticed that the commercial property market has actually strengthened, but the private property market has not. Why? Because, fundamentally, there is still a large overhang in the private property market. So, there is a theoretical link between the two in so far as both of them respond to the same economic fundamentals, the economic situation, growth, etc. But, ultimately, it will depend on the supply and demand for the supply that is available in the market.

In so far as competitiveness is concerned, yes, I have informed this House that the Government does monitor

the property market closely and make sure that we remain competitive. To that extent, we have a long-term reservoir of land that allows us to provide not just for housing but also for development, factories and so on, and we release these lands at a pace which the market can absorb. So, we do ensure that there is a sufficient supply of land for residential, commercial and industrial developments through the GLS programme.

But having said that, I think we also must realise that we cannot compete just on land price that is as cheap as what is available in our neighbouring countries, for example, with larger land masses. It is not for us to either boost or depress prices for whatever reason, because there would be implications on our economy. So, for the supply of land for commercial as well as for industrial purposes, we do monitor carefully and we do make sure that there is a sufficient and adequate supply, and we set policies to make sure that our property market is a stable one, and ensure that these policies are relevant, both through the ups as well as the downs of the cycle.

Sir, I welcome the measures as announced by the Minister, which I believe will have a positive impact on the property market, the construction sector and also the finance and investment sectors. I just wonder whether the Ministry has done any analysis on the positive and negative impact on these sectors which will create any new jobs for Singaporeans, because this is one critical area which we are looking at.

My second question is: what is the likely take-up rate of the available flats in HDB and also the private sector with this set of measures? The Ministry must have done some forecast on that.

I think the Member may not have heard me when I said,

maybe the umpteenth time, in this House that we have not actually taken a position on whether the market is going to go up and, if so, by how much. So, what is the likely take-up rate? I honestly do not know. How many jobs will it create? I think if the market does go up and it generates demand and if there is additional construction activity going on, yes, certainly the construction industry will benefit from it and I would be the first person to cheer that. I think the construction industry has gone through a very protracted period of poor performance, partly as a result of excesses in the industry itself, and partly also because the market has been hit by so many problems over the last six or seven years. So, if there is any upturn in the market and if there can be new jobs created for the construction industry and gives it a boost, then I certainly welcome it.

Mr Speaker, I would like to ask the Minister whether he has considered that this proposed reduction in the minimum cash limit and the change in the LTV policy would lead to Singaporeans buying bigger units of housing, because theoretically, with the same amount of cash, they can now borrow twice the amount from the bank. Also, would this lead to more commitments in real estate by Singaporeans and therefore adversely affect the adequacy for retirement savings?

The second question is a related one. With this change, it would seem that we are now relying very much on the bank's prudency to exercise care in granting the loans. But with the recent change in the ranking of security, now the banks rank ahead of CPF, would it not encourage the banks to be more liberal in granting loans? And if something does go wrong, the banks would rank ahead and the person who suffers would be the CPF member and his savings. Would there be any

safeguards against this eventuality from happening?

Mr Speaker, Sir, Minister Mah has suggested that I take this question on behalf of the Senior Minister.

From the MAS' perspective, we are now lowering our standards of prudence that we are expecting of banks. Essentially, what we are doing is evolving our methods. This is not new. In fact, the first change was in 2002. We are moving in a step-wise fashion, from a focus on regulation of banks towards increasing reliance on supervision of banks. Housing loan rules are a good example. We are moving from micro regulation, where each and every housing loan is subjected to MAS' regulation, towards allowing the banks to exercise more assessments of their own on the risks of the loan, the interest rate they should charge and how much they should give. But MAS would have to shift its methods and play its part of supervising the banks more actively on their housing loan books, looking at their internal credit appraisal criteria and looking at the overall risks of their housing loan portfolio. If it should be that because of economic conditions or property market conditions, we feel that their housing loan portfolios are getting too risky, we might require them to put in more capital. I think this is a more refined approach. We will be moving in steps towards this. If we had done it all in 2002, the market would have had difficulties digesting it. So the first major step was in 2002, when we changed the order of charges between CPF and banks, and also made the first move on reducing the cash requirement. We have now had three years. We are confident that the banks are now in a position to take the next step.

We expect banks to be alert, and MAS will be alert in ensuring that the banks do not go overboard, ie, ensuring that a competitive marketplace does not lead to

a lowering of standards. I am confident that the banks will exercise discipline. We will be having discussions with them to make sure that it would not be an arbitrary set of rules that they would apply to borrowers, whether it is for larger flats or the usual flats that they have been getting for a particular age group or income group. We have got to have a certain discipline within banks. There should be certain guidelines. We are not being prescriptive and we are not going to impose a common rule on every bank. But we will go in to inspect, have discussions with them and we want to be satisfied that they are not lowering their guard.

Sir, I would like to thank the Minister for the change affecting singles. It increases the housing options and which would be appreciated. But I notice that this change would benefit mainly the well-to-do high-income singles. Can the Minister consider the long-held appeal of singles to also allow them subsidised housing, in terms of new flats, because this would benefit also the broader range of singles, mainly the low income and the lower-middle income?

My next question also relates to the lower-income. The changes of lower cash payment and higher loan limit would be a boon to those who are cash-strapped and who need to buy flats. I worry about the impact, like my colleague, Mr Gan Kim Yong, on those who are in a dire situation and have to downgrade, because of all their debts, they cannot pay their S&C charges, and the lawyers are after them. But if you put yourself in the position of a downgrader now, or somebody who is cash-strapped, you would upgrade because of the new changes. Also, it does not make sense for them to downgrade now to a three-room resale flat because they have to pay the resale

levy. If you upgrade, you get a grant for upgrading.

I would ask the Minister to review the whole complex range of levies, subsidies and grants to make it sensible to the average HDB person to make the wise choice and decisions, because I am worried that those who are cash-strapped would see upgrading as a way out of their cash problems rather than to the right size and to move down.

Mr Speaker, Sir, first of all, on the issue of whether these measures benefit the high income singles more than the low-income singles, to the extent that we are rationalising our rules, as part of the review, one of the anomalies concerns the use of CPF by singles to purchase properties. In the case of HDB, under the Joint Singles Scheme, they can, but in the case of private properties, they cannot. So CPF Board relooked at it and decided that this anomaly is not tenable and, therefore, they made the change.

Does it benefit the high income more than the low income? I think the overall point to be made is this. Each person must make his own decision based on what he feels is the correct one, ie, he has to make a decision based on what he can afford and what he is able to obtain, in terms of loans, and the banks and HDB would have to make another decision based on whether such a person is able to afford the loan before it is going to disburse the loan.

When the LTV is raised from 80% to 90%, it does not automatically mean that every single person who goes to HDB or to a bank would now be able to get a 90% loan. Credit assessment will still be in place. And if you are not working or if you do not have adequate income, if your expenses are high and your disposable income is low, for whatever reason, if you are not able to service that loan, you will not get that 90% loan. This move does

not, in any way, shape or form, suggest that all the rules of financial prudence have been thrown away. No. But it does allow the banks and the HDB to grant that higher loan if that person is able to afford it. So there is no change in the philosophy that we are currently practising that each person should buy a flat or a property commensurate with his or her own means. That is still the primary consideration. HDB, for one, will be instructed that credit assessment rules would still apply. The rules requiring individuals to make full use of their CPF, so that their loan will be low, will still be there. This move may tempt a person to get a larger flat, but if he is not able to afford that larger flat, that will not happen.

But if he can afford, then it is for him to make that decision, to see whether he is over-investing or not. And there are many singles who can afford larger flats and we have actually relaxed the rules recently to allow singles to buy larger flats. That has enabled the singles to widen their housing options.

Do we encourage upgrading as opposed to downgrading? As a philosophy, the Government has always facilitated people to upgrade. But again, upgrading within their means. I do not remember us having an upgrading grant. As far as subsidies are concerned, singles do enjoy some form of subsidy which is the housing grant. Two singles can combine together to buy a flat and it would almost be equal to the grant that we give to families. But we do not have an upgrading grant. We have a grant that we give to eligible singles, in the same way that we have a grant that we give to eligible families to buy their first flat. But we do not have another grant that says, "Ok, if you upgrade, I am going to give you some more money." No.

Mr Speaker, Sir, I think it is a

no-brainer to figure out that many of the measures announced by the Minister earlier would inject a greater degree of vibrancy to the property market and shore up prices.

However, Sir, my concern here, and my heart goes out to the new, young prospective property buyer, who has been contemplating on getting a property and now suddenly finding it more expensive and a little more far-fetched to own a property as a result of increased property prices. I would like the Minister to comment on this.

Second, with regard to the measures just announced, how would this affect current property prices directly from HDB, in other words, prices for properties that are going to be sold directly by the HDB to the public?

Sir, it may be a no-brainer to the Member but it is very hard for us to predict how the market is going to be in the next three to six months, which I would consider to be short-term, because it depends on many other factors. But, as I have said earlier, we think this is the right thing for us to do in today's situation and this is still relevant, even as the market moves in whichever direction in the future.

Would it make it more difficult for new property buyers? Some of the measures will actually make it easier for them because the cash downpayment, for example, will be reduced. And if they qualify, they will be able to get a higher loan. To that extent, affordability would be increased. Yes, if the market does go up, and if prices move, of course, it would make it more expensive for the new property buyer.

What will that do as a net result? It is very difficult for me to say. It depends on individual situations. But I can assure the

Member that for HDB prices, we have always priced new HDB flats on the basis of affordability and we will continue to do so and monitor prices and make sure HDB new flats will be affordable to the target groups, in other words, those who are eligible for subsidised housing.

Mr Speaker, Sir, the Minister said that HDB flat buyers will be allowed to take a loan of up to 90%. But under HDB's current policy, when a buyer wants to take a loan from HDB, he has to use up his CPF money first before he can get a loan from HDB. I would like to ask the Minister why HDB has this policy to use up the CPF money first before allowing him to take a loan. Otherwise, the buyer has no way of taking a 90% loan. Also, the CPF money may not be used solely for housing matters. It can be used for investment or other purpose.

Sir, that is one of the reasons why we have decided to keep this requirement for HDB property buyers to make use of their CPF money in the Ordinary Account before getting the HDB loan. It is part and parcel of our exercise to make sure that HDB buyers buy properties or flats in areas that they can afford and, as a result, take as small a loan as possible

which they would have to service in future.

Sir, I just want to raise a social implication here. With regard to the joint purchase of a flat by unrelated singles, I am just wondering how this easier access for non-related singles to come together to purchase a flat will really promote homogeneous or heterogeneous gender to come together, which is actually against our pro-family policy. How do we intend to go about minimising some of the negative consequences that may arise?

Sir, I offered my colleague, Dr Ng Eng Hen, to answer this question but he very kindly arrowed it back to me.

It is very difficult for us to make any judgment on the people who are going to buy these flats. We already have in place a HDB policy that allows two singles to purchase a flat. We do not check their gender. We do not check anything else. So long as they are two singles, they can purchase a flat. This is simply a rationalisation of a rule in the private property market that is currently available in the HDB market - nothing more, nothing less.

Sir, the announced measures are generally agreed by all Members in the House to be positive for the market and, as what Dr Magad said, it is a no-brainer.

Sir, we also know that the stock market has actually gone up a lot over the last few months and, in particular, this morning before the announcement. My question is whether there is a leak in the policy planning team resulting in insider trading. Will the relevant Ministry or MAS do an investigation on the equity trades done before this announcement?

Sir, we had to publicise the fact that we would be making a statement today and that it would be telecast. The reason for publicising the notice is to make sure that everybody has equal access to information. I do not want a situation where I make a statement in the House which has an impact on the market to be available only to a few privileged people. Of course, I do not expect Members in this House to take advantage of such a situation, including NMPs. But the point is that we had to give that notice after 5 o'clock yesterday, and I expect that there will be people who will speculate. They will take

a chance and speculate as to whether the announcement will be this, that or the other. If they are wrong, they will be burnt. If they are right, I think they will make money. That is the working of the market.

As to whether there is any leak, I am not able to say. Honestly, in our own establishment, I make sure that such sensitive matters are handled adequately. If Mr Chia has any evidence of any leak, I will be very happy to investigate.

Sir, with your indulgence, first of all, can I just mention about the point that my colleague, Mdm Ho Geok Choo, said. I think a happy scenario would be the golden girl scenario where we have singles staying and growing old together if for some reason they cannot and do not want to get married. It is not a negative social implication. At least, they have company when they grow old and they can rely on each other if for some reason they cannot get married or they do not want to get married, and I think it should be their choice.

Sir, may I clarify the Minister's reply to a point that I made earlier? Maybe I was not clear. I was concerned for the cash strapped. Even now, at the meet-the-people sessions, we do see residents coming. They have no choice but to sell their flats to get some cash to pay up their loans. Therefore, especially for those in 4-room flats, they have two options: one, to downgrade, either to a rental flat or a 3-room flat. If they go for a 3-room flat, they have to purchase from the resale market which means that they have to pay a resale levy. That is a disincentive. If they buy a resale flat, from listening to my residents, my understanding is that they have to pay a resale levy. That is my understanding if they buy from the resale market. If I am wrong, perhaps the Minister can correct me.

Some of my residents have this perception that if they upgrade, they believe that with the cash they can at least pay up the downpayment and they can use their CPF to pay the rest. I tried to advise them against it. But I worry that with these changes, the option for them to move to a bigger flat when they cannot afford it will be there. I would like to ask the Minister to review the range of subsidies, grants and resale levy to see whether it would be sensible today - given that many Singaporeans are hit by economic restructuring and that many are on contract work, which means irregular income - for them to opt to sell their flats. What are their options given this scenario?

Sir, first of all, let me reiterate again the explanation I gave about the resale levy. If a person downgrades or upgrades and he buys a second flat which is a resale flat - in other words, it is bought in the open market and it is non-subsidised - then he need not pay a resale levy. The only reason why a person has to pay a resale levy is because he is coming back to the Government to take another subsidised flat. So long as you come back to buy a second subsidised flat, we have to impose a resale levy. Why? Because if we do not, then there will be many people who will be coming back and say, "Look, let me get another subsidised flat from HDB." In the early 90s, obviously, that distorted the market so much because there were so many people in the queue who already had a flat. They just came back and joined the queue because there was no cost to it. They could get another flat, why not? But with the imposition of the resale levy, that made people stop and think. "Do I really need to buy a second flat? Is it because my family has grown so that I need a bigger flat? Then I come back and get a second flat. Even though I pay the resale levy, it is still worth my while to do so." There is no penalty for those who actually downgrade to a resale flat.

Yes, I accept the fact that there are many people who are in financial difficulties at the moment. Again, this is the result of the high prices and the free-wheeling days of the early 90s when many of our residents actually bought and sold many flats, and bought at very high prices in the expectation that the prices would only go up and not come down. Yes, we are seeing all these situations now where people are cash strapped. My Minister of State has explained earlier that there are cases of people who downgrade and who either ask for and are given a rental flat in spite of the 30-month debarment, or who come back and ask for a second loan. We review those cases, recognising that the situation is such that these people are not able to buy a second flat. We have, in many instances, granted them waivers of the rules, and we have done so quite generously. Dr Wang asked whether it is 10%. I can tell him that it is more than 10% that we have actually acceded to after appeals from Members of Parliament.

I believe there is nothing in the present set of rules which will encourage people to be less prudent. In fact, we will make sure that from the lender's side, we will continue to exercise all care to make sure that people do not over stretch themselves. I say this once again that while these changes are positive for the market, each individual should continue to exercise utmost care when they make purchases of private property.

What are the rules meant for? The rules are really meant for us to make sure that we have a stable property market. We have to make sure that we have a property market that responds to market signals properly and smoothly and yet, at the same time, make sure that many of our policies are sustainable in the long run. Where we need to fine-tune our policies, we need to continue to make

sure that they are relevant to the times. We need to make sure that they are sound because, in this way, we will continue to enjoy good and sustainable growth. And, at the same time, we continue to have an efficient property market that allows itself to adjust to the changes in the marketplace. So, I repeat once again, we make all these changes for our longer term interest and not just to adjust to short term market situations.

Sir, I thank the Minister for coming out with a whole package of changes which is quite comprehensive and easily understood. I must also give praise to the fact sheet on the changes to the CPF property scheme which explains the changes very well and succinctly. My own assessment is that, overall, we will have a positive impact on the property market itself.

I have a few questions. First, the lowering of the MLP from 60 to 30 years will certainly augur quite well, especially for the retirees. How will that also impact on the bank loan policy which currently does not favour properties with remaining leases of 60 years and below?

I really like the change on the transfer of Medisave account overflows to Special Account and Retirement Account instead of Ordinary Account. I think that change itself does give a certain level of safeguard against over investing in property and, at the same time, allows the retiree who does not want to over invest in property to continue to put his money in CPF to enjoy a higher interest rate. I think that is a really good move.

On the impact of the news itself, my own assessment is that it will be overall positive. It will certainly encourage more schemes to be generated by banks, housing agencies, developers and so on and so forth to attract buyers. And the whole kaleidoscope of schemes to attract buyers will certainly, from our previous

experience, overwhelm the buyers to buy bigger properties than what they need.

Miss Low, can you please ask your questions?

Would there be some educational programmes to inform and educate buyers on the mid-term and long-term financial impact of their property purchases? Ultimately, the buyers will have to be responsible for their property purchase. But when the CPF liberalised in the 80s, the housing market went up. In the 90s, the unit trust investment also went up. How would this package impact on their financial prudence? I am advocating more consumer or buyer education.

Last but not least, on the HDB resale levy, in the mid-90s, the HDB flat prices were still holding on even till the late 90s. And a good group of first-time buyers indeed bought HDB flats at a price that was lower than the market price.

Miss Low, your question, please?

Sir, I have already asked a few questions. On this part, those who are trapped in the high prices of mid to late 90s, some of them who want to downgrade and apply for a second HDB flat are currently asked to pay a resale levy. They could be suffering from negative equity but the resale levy still applies. Could the Minister consider some measures to help these people?

Sir, let me respond to the Member's question on the resale levy. Yes, these are the people who have been trapped in the high prices of HDB flats bought at the peak. They now want to downgrade. We have other options available for them which include buying a smaller resale flat

in an area which is not so expensive. Another option is renting of

flats from the market. Other options include moving in with their friends or relatives. On the HDB option that the Member is suggesting, ie, that we waive the resale levy for these people in difficulty, I think it is an example of a policy which is not sustainable in the long run. Because when the situation changes, and property prices start to go up, I think we are going to see a recurrence of the high demand as a result of people coming back for a second bite. I do not think we want to see that situation again, firstly, because it is not fair to those who are genuine first-timers, and secondly, it will strain our financial resources. So, the resale levy stays. We will continue to finetune it, if necessary, but the principle of having a resale levy must stay because there is a perfect rationale for it.

On consumer education, it goes on all the time. This is something which I hope the Member can also help to do because she is in the business of helping people plan for their future. So financial planners, the media, the banks and HDB will continue to play that role. In fact, I have asked HDB, every time when their officers talk to people who are intending to buy a flat, to take them through the numbers, find out from them why they need the flat, what they are buying it for, can they afford it, what jobs they are doing, and so on. This is part and parcel of consumer education. It is not just a matter of somebody walking in and say, "I want to buy a flat", and that is it. Consumer education is important, I agree. But it is something that has to be undertaken by many people and ultimately the individuals must take responsibility for that purchase. I do not think they can abdicate that responsibility.

I would like to ask Dr Ng to respond to the other questions.

Let me address the Member's questions about the change in

the minimum lease period (MLP). The original intent of the MLP is that we wanted to facilitate long-term ownership by members who use their CPF funds. That intent is still preserved. In other words, even as we allow CPF to be used for properties with 30 to 59 years, it will not be for all members. There will be two qualifications. One is that the remaining lease of the property to be purchased must cover the member at least up to the age of 80 years. Put simply, in other words, if the property is 40 years, the lease is 40 years, you must be 40 years or older before you can use your CPF. So that is preserved.

Secondly, on the withdrawal limit, how much you can use your CPF. As Members know, for properties 60 years and above, we said that the withdrawal limit for housing expenditure will be 120% of the valuation limit by 2008, and that remains unchanged. That is a safeguard in terms of prescribing prudence into our system. For properties that are 30 to 59 years, they will have lower CPF withdrawal limits based on the residual value of the property and the member's CPF withdrawal age of 55. What it means is that depending on the buyer's age and the remaining lease, the shorter the lease as we projected to be, the remaining lease at 55, there will be reduced withdrawal limits. Basically, it is a straightline depreciation curve that we will use.

So there are these two additional safeguards to preserve our original intent: one, we should facilitate members to buy properties that will last the average life expectancy; two, we preserve the investment value, and make sure that they do not over-consume in their CPF accounts.

On the point of MA to SA overflows, rather than OA overflows, I thank the

Member for her concurrence. We think indeed that this is a good prudential measure. In terms of education, let me also add to the Minister for National Development's point, ie, CPF on its own will also educate members. In other words, a lot of members do not realise that when we say 120% withdrawal limits, it may be X number of years beyond which you cannot use your CPF if you reach that amount. Indeed, we do advise members that this is the case, and we will continue to do so.

Order for Second Reading read.

4.51 pm

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

Sir, this Bill seeks to amend the CPF Act to enable the privatisation of Dependants' Protection Insurance Scheme (DPIS) as announced in June last year. The Bill also seeks to amend the Act to allow for the MediShield reform changes announced by the Minister for Health, in particular the privatisation of the MediShield Plus scheme.

Privatisation of the DPIS

The DPIS provides financial help to the families of insured CPF members who pass away or become permanently disabled. Since 1989, more than 28,000 families have received benefits totalling about $1 billion from the DPIS.

The Economic Review Committee (ERC) recommended in 2002 that the Government devolve CPF-based insurance schemes to private insurers. It was hoped that healthy competition would bring about greater efficiencies and benefits for

members. This was the specific outcome to be achieved as the CPF Board evaluated submissions from private insurers. I am happy to report to this House that the insurers appointed to take over DPIS, namely, Great Eastern Life Assurance Company Limited (Great Eastern Life) and NTUC Income Insurance Co-operative Limited (NTUC Income), are able to offer better terms to all members currently under DPIS. After privatisation, all members will enjoy an immediate increase in coverage from the current $44,000 to $46,000 with premiums unchanged. This is for existing and new members. In addition, members who are aged 55 or older will enjoy a reduction in premium from $360 per annum to $260 for the same level of coverage. This reduction replaces the existing loyalty premium discount given when members reach the age of 55 under the current scheme.

The Dependants' Protection Insurance Fund (DPIF) is established under section 46 of the CPF Act. DPIS premiums are currently paid into this fund, and DPIS claims are paid out from this fund. After privatisation, the fund would be dissolved, and the amounts standing in the fund would be transferred to the appointed insurers so that they can take over the insured CPF members' liabilities. Clause 9 will repeal section 46 and dissolve the DPIF established under this section. Clause 11 will insert new sections 49A(1) and 49B to allow for the transfer of CPF Board's liabilities under the DPIS to the appointed insurers as well as the necessary funds from the dissolved DPIF to meet the transferred DPIS liabilities. CPF Board will retain part of the dissolved fund to pay for liabilities incurred before privatisation.

Clause 11 also inserts a new section 49A(3) to empower the CPF Board to require, when the need arises, any appointed insurer to transfer its liabilities under the DPIS to another appointed

insurer. This is to cater for a situation where one of the appointed insurers becomes unable to execute its responsibilities.

To enable the appointed insurers to administer the DPIS after privatisation, CPF Board will need to disclose certain information on insured members to the appointed insurers. Clause 11 inserts a new section 49C to empower the CPF Board to provide such information to the appointed insurers. To ensure that members' privacy and rights are protected, the appointed insurers will only be allowed to use the information provided for the purposes approved by CPF Board.

Section 45 of the CPF Act currently provides for the deduction of DPIS premiums from the insured members' accounts. Clause 8 amends section 45 to clarify that, upon privatisation, DPIS premiums will be deducted from the insured members' CPF Ordinary or Special Accounts and paid to the appointed insurers.

Sir, let me now move on to explain the amendments to facilitate the MediShield Reform.

MediShield reform

Sir, from 1st July 2005, the Ministry of Health has introduced various changes to MediShield and the Medisave-approved private insurance framework. These changes will prevent cherry-picking by private insurers, restore the integrity of the MediShield risk pool, and bring about a more competitive and dynamic private medical insurance market. The key changes pertain to the privatisation of the Medi

Shield Plus Scheme operated by CPF Board, and the restructuring of the Medisave-approved private insurance plans.

Sir, as part of the package of MediShield reform, the existing MediShield Plus Scheme operated by the CPF Board will also be privatised through a competitive tender. This will speed up the development of stronger competition in the Medisave-approved private insurance market. CPF Board aims to award the tender and transfer all MediShield Plus policyholders to the new insurer by October 2005.

As with the privatisation of the DPIS, the existing liabilities under the MediShield Plus Scheme will need to be transferred from the CPF Board to the private insurer appointed to take over the MediShield Plus portfolio. Clause 15 inserts a new section 56A(7) to allow CPF Board to transfer part of the MediShield Fund to the appointed insurer to meet the transferred MediShield Plus liabilities, such as long-term commitments for treatments like dialysis and chemotherapy.

To facilitate the appointed insurer to perform its functions, section 59 has been amended to allow the CPF Board to share relevant information relating to the MediShield Plus policyholders, such as their past claims history and medical information, with the appointed insurer. Strict rules will be set on use of the information to safeguard the interests and privacy of policyholders. The appointed insurer will not be allowed to use the information for any purpose, other than for those connected with the administration of the scheme. The information also cannot be provided to their insurance agents or other parties for any other purposes.

To safeguard MediShield Plus policyholders' interest in the event of a possible failure by the appointed insurer to carry out its duties, clause 15 also inserts a new section 56A(3) to empower the CPF Board to require the transfer of liabilities under the MediShield Plus Scheme from

the appointed insurer to another appointed insurer, if the need arises.

Mr Speaker, Sir, apart from MediShield Plus, Singaporeans can also choose to take up other Medisave-approved private insurance plans for additional coverage for stays in Class A or B1 wards and private hospitals. As of 1st July 2005, MediShield has been repositioned as the basic insurance tier upon which the private insurers may provide additional benefits and coverage. These plans are integrated with MediShield as one single product, administered by the private insurers in a way that is seamless to policyholders.

As policyholders under the new integrated plans will also be MediShield policyholders, CPF Board will take on the liabilities relating to the MediShield component for these policyholders without any further medical underwriting. These include long-term commitments for policyholders who are already claiming from their private insurer. Clause 15 inserts a new section 56A(9) to provide for the transfer of any monies from the private insurers to the MediShield Fund to meet these long-term commitments.

Withdrawal from the Medisave Account for approved purposes

Sir, let me now turn to the remaining amendment, which is on Medisave account withdrawals.

CPF members can withdraw their Medisave Account savings for approved purposes, which include medical treatments or services, and premium payments under approved medical insurance schemes. Such withdrawals are allowed even if members have not set aside the Medisave Minimum Sum in their Medisave Account. However, this is not clearly reflected in our legislation. Hence, clause 2 amends section 13 of the CPF Act to make it explicit that such approved withdrawals can be made, without

members having to set aside the Medisave Minimum Sum in their Medisave Account.

Conclusion

In conclusion, Mr Speaker, Sir, the amendments proposed in the Bill will enable the privatisation of the Dependants' Protection Insurance Scheme and the MediShield Plus Scheme. These amendments will also facilitate other aspects of the MediShield Reform as announced by the Minister for Health. Sir, I beg to move.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Dr Ng Eng Hen].

Bill considered in Committee; reported without amendment; read a Third time and passed.

Mr Speaker, Sir, we still have some business tomorrow on the Minister for Health's Statement.

Resolved,

"That Parliament do now adjourn." - [Mr Wong Kan Seng].

Adjourned accordingly at

Five o'clock pm.

WRITTEN ANSWERS TO QUESTIONS FOR ORAL ANSWER NOT ANSWERED BY 3.00 PM

asked the Minister for Education given the recent reported drownings of youths during recreational swimming activities, (a) whether this has been due to any changes in policies or practices in our school system with regard to swimming lessons; and (b) what should the Ministry be doing about this.

There has been no change in policy with regard to swimming lessons. The Ministry of Education (MOE) and schools seek to provide our students with basic survival skills such as swimming as part of the holistic education that we give them. Swimming was first introduced in the PE curriculum in 1982 through a pilot programme conducted in 18 schools. However, the programme was discontinued in 1985 as a large number of schools were unable to conduct the programme due to logistical and resource constraints.

In 1987, a Learn-to-Swim Scheme was again piloted in seven primary and 15 secondary schools. The aim of the scheme was to enable students to swim 25 metres and learn water safety skills. Following the pilot, the Scheme was extended to more schools. Presently, the Scheme continues to be conducted in schools. In collaboration with Singapore Sports Council (SSC), swimming coaches are engaged by the schools at reasonable rates. They also provide further training to our students beyond these very basics. The average number of primary school pupils who benefit from this programme each year is about 10,000. In addition, about 55% of primary schools and 25% of secondary schools offer swimming as a CCA.

More generally, in addition to the Learn-to-Swim Scheme, the Physical Education syllabus includes water safety skills. It includes components on Water Safety, Water Confidence, Swimming/Basic Survival Techniques and Rescue Techniques from the primary to pre-university levels.

Currently, schools are given the flexibility to plan and implement their own swimming programmes to meet the needs and interests of their students. We acknowledge that schools face some constraints, namely, the lack of swimming instructors and availability of swimming pools.

Going forward, we will review the current situation in primary schools to see how further support could be provided to schools to carry out the swimming programme more effectively. We will work with agencies such as SSC to find possible solutions.

asked the Minister for Manpower if he will consider compulsory medical insurance coverage be included as a condition when applying for a work permit.

Under the Employment Act, employers are required to bear the medical consultation fees incurred by their local and foreign employees with at least six months of service. In addition, under the Workmen's Compensation Act, employers are also required to bear the medical cost and compensate their workers for work-related injuries.

Currently, we only require employers to purchase insurance to cover for their potential liabilities for workmen's compensation. Employers of foreign domestic workers are also required to purchase personal accident insurance for their workers. These were imposed to help employers mitigate the risk of high compensation or medical costs that they could potentially incur.

The medical cost for workers is another potentially high liability and some companies do already buy insurance to cover for this cost. MOM will examine if there is a need to introduce compulsory medical insurance for foreign workers to mitigate this risk.

asked the Minister for Health what are the criteria used to determine which drugs qualify for the standard drug list for which Government subsidies apply.

The Standard Drug List (SDL) is drawn up by my Ministry, based on the recommendations of an expert committee called the Drug Advisory Committee. New drugs are regularly introduced into the market for the treatment of a wide variety of diseases. Hence, the Drug Advisory Committee reviews the SDL regularly, with inputs from our clinicians.

The Committee takes into account five key factors:

Whether the medical conditions are common and important causes of morbidity and mortality in Singapore;

Whether the drugs are essential for the treatment of these medical conditions;

Whether the drugs offer a major improvement in terms of efficacy and effectiveness, as compared to existing standard drugs;

Whether there is sufficient long term safety data pertaining to the drugs; and

Whether there is sufficient evidence of the drugs' cost-benefits.

In addition, my Ministry regularly compares our SDL with international formularies such as the WHO Essential Drug List, the Australia Pharmaceutical Benefit Scheme, and the US Kaiser Permanente Drug List.

asked the Minister for Health what emergency preparedness contingency plans our hospitals have to deal with a mass biochemical attack and whether we have sufficient resources to deal with such a contingency.

We have various contingency plans to deal with biological and chemical attacks. The nature of the plan will depend on the scale of attack and the type of biological or chemical agent used.

The risk of such an attack on the civilian population is low but real. It has happened elsewhere before. In 1995, Aum Shinrikyo, a Japanese cult, carried out a chemical attack using Sarin gas on the Tokyo subway lines. The attack killed 12 and injured over 3,000 people, of which some 500 were hospitalised.

More recently in 2001, a series of attacks through the use of anthrax-laced letters affected several locations in the US, including the Senate. This is a biological attack using a bacterium that causes anthrax. There were 22 victims, of which five died. It caused widespread anxiety among the population.

Dealing with such attacks requires a total effort involving several Ministries as well as the private sector and Singaporeans at large. For the healthcare sector, biological and chemical attacks pose rather different challenges. Chemical agents such as nerve agents cause immediate injuries to those exposed. Survival is largely predicated on how quickly we can deliver treatment to the victims. If a large number of people are exposed, then there will be a large and sudden surge of victims needing immediate care in our hospitals.

On the other hand, a biological attack will normally not yield immediate casualties. There would be an incubation period before the symptoms start to manifest and patients appear at the hospitals. Since many of the possible bioterror agents are transmissible from person to person, if we are not able to identify and isolate the victims, the public would continue to be at risk of contracting the disease, long after the perpetrator has left the scene.

Hence, we need a range of contingency plans to meet the various types of attacks. We have, for example, a contingency plan to deal with a chemical attack which results in up to 1,000 casualties. For biological attacks, we have focused on a few bioterror agents such as anthrax and smallpox. As a general principle of contingency planning, we need to make sure that the necessary system, infrastructure, equipment, and skilled manpower are in place.

There are no perfect or comprehensive contingency plans. We just have to regularly review and update them in the light of new knowledge and experiences. We have learnt much through dealing with SARS. First, we now have a quicker system to mount a coordinated response that involves many Government agencies, so that we can respond quickly to save lives and mitigate the impact to public health. Second, we have

strengthened our infection control measures in the public hospitals. Third, we have enhanced our hospital infrastructure, with isolation rooms and fever screening areas to prevent cross infection. Fourth, we have acquired stronger capabilities in field epidemiology, infectious disease surveillance, contact tracing and quarantine which will all come in handy in any bioterror attack. Fifth, we have built up a stockpile of critical medical supplies including essential drugs, vaccines, antidotes and personal protective equipment.

In addition, our public hospitals have expanded their contingency plans to deal with a sudden upsurge of patients in the wake of an attack. Current situation is much better than before, though not yet fully satisfactory. Our main limitations are in the capacity of the emergency departments and intensive care beds. We are expanding the physical capacity and training additional staff in these areas. We are also building more de-contamination facilities so that healthcare workers can be protected when treating patients affected by chemical agents.

As always, prevention is better than cure. That is why we are introducing measures to reduce the risk of an attack on Singapore. One such measure is in the control of hazardous substances. Administratively, we have tightened the control of access to dangerous biological agents. We now need the legal backing to such a measure. A Bill for this purpose is being drafted and I will introduce it to this House in a few months' time.

But prevention is not the job of the Government alone. We can all play our part to be vigilant. And in the event of a bioterror attack, Singaporeans can also help to bring the transmission of the disease under control by consulting their doctors when they are unwell and isolating themselves if advised to do so.

Formulating contingency plans and exercising them are important parts of our national preparedness to deal with terror attacks. We will continue to refine our plans and enhance our capabilities to deal with emerging threats as they are identified.

asked the Minister for Home Affairs (a) how long is the processing time for Traffic Police to respond to public feedback on persistent illegal parking on roads; (b) what are the steps taken by Traffic Police in response to such a feedback; and (c) what is the frequency of checks by Traffic Police on stretches of roads known to have frequent illegal parking incidences.

Traffic Police receives feedback on illegal parking from the public by telephone and through the post. When a member of the public writes to Traffic Police with feedback on illegal parking, he will receive an acknowledgement from the Traffic Police within five working days.

Upon receiving feedback on illegal parking, if Traffic Police assesses that the vehicle is causing serious obstruction or posing road safety risks to other road users, Traffic Police will immediately proceed to the scene to take action. Otherwise, Traffic Police adopts a problem-solving approach to tackle the illegal parking problem at source.

First, Traffic Police will form a working group, which involves the community living around the area of complaint. Participants in such working groups include representatives from schools, grassroots organisations, places of worship, and other agencies such as the Land Transport Authority and the Urban Redevelopment Authority. The working group will then assess the problem and work towards a solution that meets the needs of all the stakeholders. Typically, the group will arrive at a consensus after meeting for about one to six months.

In areas with frequent illegal parking problems, CISCO officers, under the Traffic Warden Scheme, typically conduct patrols every 15 minutes to enforce against parking offences.

asked the Minister for National Development if his Ministry will consider giving higher Central Provident Fund top-up grants to married couples who are first-time buyers of HDB flats and who opt to stay with their parents, so as to encourage more Singaporeans to provide care to their parents.

Currently, first-time buyers of an HDB flat can enjoy a CPF housing grant of $30,000 if they buy a flat from the resale market. If they buy a resale flat with their parents, or near to their parents' flat, ie, within the same town or within 2 km, they can qualify for a 2nd-tier grant of $40,000.

The take-up rate for the 2nd-tier grant has been very encouraging in recent years. More than half the housing grant applicants have opted for the higher grant. This shows that the current grant of $40,000 already provides a strong financial incentive for married children to live with or near to their parents, for mutual care and support.

MND's view is that there is no need at this point in time to further differentiate the CPF housing grant between married couples who live with their parents, and those who live near to them.