Hansard, 2009-03-23

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 (2009) To (2009) Mr Yeo Guat Kwang 19 Feb 21 Feb Mr Charles Chong 22 Feb 28 Feb 10 Mar 14 Mar Mrs Yu-Foo Yee Shoon 23 Feb 02 Mar Mr Arthur Fong 24 Feb 28 Feb 24 Mar 27 Mar Mr Lee Kuan Yew 24 Feb 26 Feb Mr Matthias Yao Chih 26 Feb 01 Mar 12 Mar 15 Mar Dr Teo Ho Pin 27 Feb 01 Mar 03 Mar 08 Mar Mr Liang Eng Hwa 28 Feb 01 Mar Mr Wee Siew Kim 01 Mar 04 Mar 06 Mar 07 Mar Mr Zainul Abidin Rasheed 01 Mar 04 Mar 12 Mar 25 Mar Dr Amy Khor Lean Suan 02 Mar 10 Mar 24 Apr 24 Apr RAdm [NS] Lui Tuck Yew 02 Mar 04 Mar 24 Mar 27 Mar Dr Vivian Balakrishnan 02 Mar 06 Mar 13 Mar 15 Mar Mr George Yong-Boon Yeo 03 Mar 05 Mar 10 Mar 10 Mar 13 Mar 15 Mar 22 Mar 29 Mar Assoc. Prof. Koo Tsai Kee 03 Mar 03 Mar Column: 3313Mr Zainudin Nordin 04 Mar 05 Mar 14 Mar 19 Mar 28 Mar 30 Mar Mr Abdullah Tarmugi 06 Mar 06 Mar 04 Apr 12 Apr Mr Ong Kian Min 06 Mar 09 Mar 21 Mar 29 Mar Mr Sin Boon Ann 06 Mar 09 Mar Mr Masagos Zulkifli B M M 09 Mar 14 Mar Mr Lim Boon Heng 10 Mar 13 Mar Mdm Cynthia Phua 12 Mar 25 Mar Mdm Ho Geok Choo 12 Mar 25 Mar Mr Hri Kumar Nair 12 Mar 15 Mar Mr Inderjit Singh 12 Mar 20 Mar Dr Lee Boon Yang 12 Mar 25 Mar Mr Lim Swee Say 12 Mar 15 Mar 19 Mar 21 Mar 13 Apr 21 Apr Dr Mohamad Maliki Bin Osman 12 Mar 25 Mar 04 Apr 11 Apr 12 Apr 18 Apr Mr Hawazi Daipi 13 Mar 15 Mar 18 Mar 20 Mar Assoc. Prof. Ho Peng Kee 13 Mar 15 Mar Mr Mah Bow Tan 13 Mar 15 Mar Mr Teo Chee Hean 13 Mar 15 Mar 01 Apr 04 Apr 07 Apr 10 Apr Assoc. Prof. Dr Yaacob Ibrahim 13 Mar 15 Mar 18 Mar 22 Mar Mr Ang Mong Seng 14 Mar 18 Mar 02 Apr 05 Apr Mrs Lim Hwee Hua 14 Mar 17 Mar Dr Lam Pin Min 15 Mar 18 Mar 02 Apr 12 Apr Dr Muhammad Faishal Ibrahim 15 Mar 17 Mar 01 Apr 06 Apr Prof. S Jayakumar 15 Mar 19 Mar Dr Ong Seh Hong 16 Mar 17 Mar Mr Tharman Shanmugaratnam 16 Mar 18 Mar Mdm Halimah Yacob 17 Mar 22 Mar 27 Mar 29 Mar Column: 3314Mr S Iswaran 18 Mar 22 Mar 28 Mar 29 Mar Mr Raymond Lim Siang Keat 19 Mar 20 Mar Mr Yeo Cheow Tong 20 Mar 31 Mar Mrs Jessie Phua 21 Mar 28 Mar 01 Apr 09 Apr 17 Apr 23 Apr Mr Lee Yi Shyan 22 Mar 25 Mar Mr Goh Chok Tong 23 Mar 27 Mar Ms Grace Fu Hai Yien 23 Mar 27 Mar 30 Mar 02 Apr Er Lee Bee Wah 23 Mar 26 Mar Mr Chan Soo Sen 24 Mar 31 Mar Mr Seah Kian Peng 24 Mar 28 Mar Mr Teo Ser Luck 24 Mar 25 Mar Mr Lim Hng Kiang 27 Mar 30 Mar Ms Jessica Tan Soon Neo 29 Mar 11 Apr Mr Khaw Boon Wan 31 Mar 02 Apr 19 Apr 23 Apr

Mr Zainudin Nordin

Mr S Iswaran

ABDULLAH TARMUGI Speaker Parliament of Singapore

The following Bills were assented to by the President of the Republic of Singapore on the dates stated:

*The opinion of the President on the draw on past reserves was circulated to hon. Members on 12th March 2009 and is reproduced in the Annex section(Cols. 3485-3486). **The opinion of the President on the draw on past reserves was circulated to hon. Members on 12th March 2009 and is reproduced in the Annex section (Cols. 3487-3488).

27th February,2009 (1) Criminal Law (Temporary Provisions) (Amendment) Bill (2) State Lands (Amendment) Bill 9th March,2009 (1) Supply Bill* (2) Supplementary Supply (FY 2008) Bill** ABDULLAH TARMUGI Speaker Parliament of Singapore

[Mr Speaker in the Chair]

1. Mr Seah Kian Peng asked the Minister for Trade and Industry given the various credit schemes introduced by the Government, whether he will provide an update on (i) the total amount of new loans approved by financial institutions to businesses in the last three months; and (ii) the total amount of loans which have been rolled over.

2. Mr Seah Kian Peng asked the Minister for Trade and Industry whether there are cases where banks are asking businesses to switch their loans to the Special Risk-Sharing Initiative scheme failing which their credit lines will be pulled back and, if so, (i) what are the implications to these businesses, in particular SMEs; and (ii) what is the Ministry's response to such practices by banks.

Mr Speaker, Sir, can I have your permission to take Question Nos. 1 and 2 together?

Yes.

Sir, the Special Risk Initiative (SRI) announced in Budget 2009 has significantly enhanced the Government's existing loan schemes to help companies. The SRI has facilitated continued lending by banks to viable companies, which had enjoyed credit lines on commercial terms during good times, but were now facing the danger of reduced credit. Banks have tightened credit lines on account of heightened risk aversion during this period of uncertainty, or perceptions of weaker short-term business prospects facing the companies. Allowing banks to transfer commercial credit lines to the new Bridging Loan Programme reduces the pullback of such funding and allows these companies to continue meeting their business financing needs. Disallowing such line transfers would result in significantly reduced credit for these companies. Financial institutions would, however, do well to comprehensively assess the overall long-term banking relationship with the client company, before deciding whether there is a need to curtail existing commercial credit lines, or to supplement or transfer part of the line to a Government loan scheme.

Sir, Mr Seah Kian Peng also asked for an update on the overall credit situation. Data collected by MAS indicates that the total amount of outstanding commercial non-bank Singapore dollar-loans has fallen by about 4%, from a peak of $163.2 billion in October 2008, to $156.8 billion in January 2009. The month-on-month rate of reduction has, however, eased from 2.2% between October 2008 and November 2008, to 0.65% between December 2008 and January 2009. This overall reduction in commercial loans is reflective of the more difficult business conditions, and was also seen in previous economic downturns.

Sir, I thank the Minister for the answer.

Is he able to give me specific numbers for the questions that I have tabled? Also, would the Ministry be concerned if many banks are indeed asking their clients to switch over from their existing loans to this new package, what it means to the businesses and whether the Ministry itself is taking a proactive approach in understanding the extent of the situation?

Mr Speaker, Sir, I think we have to go back to the fundamentals. The Government set up this Special Risk Initiative in order to help our companies and, therefore, we want to be as facilitative as possible. At the same time, of course, we cannot be granting blank cheques to all our companies. So there has to be a balance. On balance, I think we have taken a more facilitative approach.

Sir, I do not have the specific number of the bank transfer loans because the banks, in evaluating the credit needs of the companies, may just extend part and may supplement with the Government loans or may terminate the loans. So there is no clear basis for collecting the data. What I can say is that from the indication that we had previously, the Government loan schemes that we extended were less than $100 million per month in 2008, so that over the year we extended about $1 billion. For the first three months of this year, our average loan approval rate exceeds $300 million. So it is already more than three times what we approved and disbursed. It shows that we are trying to be helpful and we are extending the loans. Of course, we have to be careful that the banks do not just transfer all their bad loans to the Government schemes. And here, we are in constant dialogue with the banks. Both MAS and IE Singapore follow the banks' classification of loans closely. And if the loan is already a non-performing loan, then, of course, the bank cannot transfer the loan

to the Government schemes. But, on the whole, our attitude is that we try to be as facilitative as possible, and we need to strike this balance.

Sir, just one other supplementary question. I agree that indeed this package is meant to help the businesses. Does the Ministry contemplate that there could be a situation where every loan – good or bad loan – is transferred from the financial institution's existing portfolio into this scheme? And if it does, are we allowing this to happen?

Sir, in our discussions with the banks, I think the banks understand the objective of the Government schemes. We do have a close audit of all the loans. We also have a general rule which we extend to the banks – that we do not expect to see more than 30% of refinancing loans. So 70% will be new loans extended to our companies. This is in the spirit of why the Government has these credit schemes in the first place – to be able to generate new credit facilities for our companies. It is with this understanding that we work closely with all the financial institutions.

3. Mr Gautam Banerjee asked the Minister for Finance what are the additional amounts available for Government spending included in the revised estimates for the year ended 31st March 2009 and the budget for the year ending 31st March 2010 as a result of the constitutional amendment in October 2008 that now allows the Government to spend on the basis of total returns on relevant assets.

4. Mr Gautam Banerjee asked the Minister for Finance with regard to investment returns on our reserves (a) what are the key assumptions in computing the expected long-term real

rate of return on relevant assets for the purpose of determining the total returns on these assets; and (b) how does the "expected long-term real rate of return" compare with the actual historical long-term real rate of return.

5. Mr Gautam Banerjee asked the Minister for Finance with regard to investment returns on our reserves, how he has satisfied himself with the reasonableness and fairness of the assumptions inherent in the computation of the expected long-term real rate of return on the relevant assets.

Mr Speaker, Sir, with your permission, I would like to take Question Nos. 3, 4 and 5 together.

Yes.

Sir, Mr Gautam Banerjee asked about the additional amounts available for Government spending for year ended 31st March 2009 and year ending 31st March 2010 under the new Constitutional framework for spending from investment returns.

The new framework for spending will take effect from 1st April 2009. It, hence, does not affect the amount of investment income taken into the Budget for spending for the fiscal year ending 31st March 2009, which continues to be based on the earlier framework of actual interest and dividend income alone. For this fiscal year which is ending soon, the Government took in a Net Investment Income Contribution of $3.7 billion.

For the coming fiscal year ending 31st March 2010, the Net Investment Returns Contribution (NIRC) was estimated in the Budget to amount to $7.7 billion. The figure was reflected in the Budget Statement in January 2009. Compared to the Net Investment Income Contribution

taken in last year under the old framework, the NIRC of $7.7 billion is an increase of about $4 billion, or about 1.6% of GDP.

Members would know that this Net Investment Returns Contribution starting with the coming fiscal year is based on the new framework of spending out of long-term expected real returns, not limited to interest and dividends. The framework applies to expected returns on the reserves managed by GIC and MAS. There is no change in rules for spending out of Temasek's returns, which continue to be based on actual dividends.

The process for determining the long-term expected real rates of return of the reserves invested by GIC and MAS has been rigorous. The rates, which refer to the expected real returns over the next 20 years, were proposed by the Boards of GIC and MAS respectively, based on detailed study and assessments by investment professionals in the two agencies. The GIC and MAS teams first projected the expected returns on each individual asset class, such as bonds or real estate. This was followed by aggregating the expected rates of return on the individual asset classes into the overall rates of return on the GIC and MAS portfolios, which take into account their respective asset allocation strategies.

The GIC and MAS took into account both historical trends and a forward-looking analysis of the investment outlook, before reaching their best judgments. The methodology did not in any instance involve a mechanical extrapolation of past trends. In making their assessments, they also took into account projections of future returns on each asset class by their peers amongst institutional investors.

The Ministry of Finance undertook a thorough review of the methodologies used by the GIC and MAS, and was

satisfied that their approach was sound and the estimated long-term rates of return were reasonable. As Minister for Finance, I therefore proposed these rates to the President for the purpose of Budget 2009. The President obtained the advice of the Council of Presidential Advisers, as required under the Constitution, before concurring with the Government's proposals.

Mr Banerjee asked how the expected long-term real rate of return compared with the actual historical long-term real rate of return. The expected rates of return – to repeat what I mentioned earlier, which are estimates of the average returns expected over the next 20 years – reflected the GIC and MAS Boards' assessment that the future investment environment is likely to be less benign than that over the last 20 years. The expected rates of return for the individual asset classes over the next 20 years are, in fact, generally lower than the historical rates. However, the expected rates on GIC's overall portfolio also reflect the fact that it is now considerably more diversified across a range of risk assets than it was 20 years ago.

Sir, I thank the Minister for the explanations. Given the complexity of the process, the inherent risk of the assumptions that have been used in this expected long-term rate of return and, obviously, the interest by everyone in making sure that the process is robust and transparent, would the Minister consider, at some stage, giving a little bit more information and communicating on some of these details so that there is confidence and acceptance of the new procedures?

Sir, first, of course, I can assure Mr Banerjee

and Members that the process is a robust one. We spend a lot of time on this. First and foremost, within the GIC and the MAS – professional staff and the boards. The Ministry of Finance gets into a fair level of detail in assessing the methodology – we are not professional experts but we have got to make sure that the methodologies are sound and are comparable with the best practices in the investment world. The President, advised by the Council of Presidential Advisers, does an independent check on the methodologies so as to assure himself that the final proposals are sound.

This is not a science. It involves judgment, and this is judgment principally on the part of seasoned investment professionals. The best way of ensuring that the system is robust is to ensure these internal processes of governance, first, of putting professional expertise into play; second, internal governance within the GIC and MAS; third, the Ministry of Finance doing its own due diligence on the methodologies used; fourth, the Council of Presidential Advisers taking an independent look and advising the President; and, finally, the President deciding on whether to approve the Government's proposals. That is really the basis of our system. But I am sure the GIC will, in its annual reports in future, give a flavour of its thinking on the investment environment going forward. It has done so in its last annual report and I am sure, going forward, it will also provide a feel for its thinking on how the investment environment is likely to shape up.

asked the Acting Minister for Manpower if he will provide an update on (i) the unemployment situation, in particular the profile of workers affected; (ii) efforts to assist the

unemployed and the retrenched to find jobs; and (iii) the availability of jobs.

Sir, with the economy falling into recession, the seasonally adjusted overall unemployment rate rose to 2.5% in December 2008 from 2.2% in September 2008 and 1.7% a year ago. The resident unemployment rate increased for the fourth consecutive quarter to 3.7% in December 2008, from 3.3% in September 2008 and 2.4% in December 2007. An estimated 69,900 residents were unemployed in December 2008. The seasonally adjusted figure was 73,200, up from 65,500 in September 2008 and 46,200 in December 2007.

The impact of the slowdown was felt across all groups of workers. In December 2008, those with below secondary education formed the largest group, totalling 21,300 and constituting 31% amongst the unemployed. Sixteen thousand-two hundred or 23% of the unemployed had secondary education. Six thousand-four hundred or 9% were diploma holders while 14,800 or 21% were degree holders.

On age profile, workers aged 40 and above continued to form the largest group totalling 30,300 or 43% among the unemployed. Fifteen thousand-seven hundred or 23% were aged between 30 and 39 while 23,900 or 34% were aged below 30.

There are increasingly more PMETs affected by this recession, partly due to their increasing proportion in our workforce. For the whole of 2008, 6,200 PMETs were made redundant, forming 37% of the workers displaced, up from 31% in the year before.

MOM and WDA have been working closely with the Community Development Councils (CDCs) and the Employment and Employability Institute or e2i on a range of measures to help retrenched workers and the unemployed find jobs. Both e2i and

WDA work with companies conducting retrenchment exercises to render assistance to retrenched workers to find new jobs. The Career Centres at the CDCs and NTUC's e2i provide a comprehensive suite of services, ranging from training and counselling to job matching for the job seekers. They cater to both rank and file as well as PMET job seekers under SPUR and the Professional Skills Programme announced recently.

As at end of February 2009, over 43,000 workers have been committed for SPUR training, including about 17,000 individuals who have signed up for SPUR courses at CET centres, ITEs and the five polytechnics. About one-third of these individuals are PMETs who signed up for training for jobs in the creative industries, community and social services, finance, landscape, process and manufacturing, tourism and educational services. In 2008, an estimated 13,300 unemployed locals found jobs through the assistance of the CDC Career Centres. This year will be more challenging but our Career Centres are gearing up to do more for the unemployed Singaporeans.

Sir, while we can expect job losses in the externally-orientated sectors, there are still opportunities in other sectors, such as construction, pharmaceuticals, health care, education, public administration, tourism, and so on, which are still hiring.

There will be at least 45,000 new jobs available over the next two years. This includes more than 20,000 jobs at the two Integrated Resorts; 18,000 jobs in the public sector; and some 6,000 from the pipeline of new investments, including 1,200 in clean technology and 900 in biomedical sciences. Many of these jobs are PMET jobs. There will also be new jobs in the retail, F&B and hospitality industries with the opening of new malls and hotels; as well as in the construction, security, childcare and interactive digital media industries.

While we work with our tripartite partners to save jobs and help the unemployed find jobs, it is also important for us to continue to bring in new jobs. Therefore, we have to ensure that Singapore remains an attractive place for business and investments and our workforce remains competitive and flexible. This way, we can continue to create more opportunities for Singaporeans.

Sir, I am heartened to hear that there are many jobs in the pipeline. But I just want to ask the Minister what is the time taken now to place workers in these new jobs because I see an increasing number of PMETs coming to the MPS session looking for jobs and they said it is hard now for professionals to find a job in the market.

Sir, with the economic slowdown, I think it will take longer for many of the jobseekers to find new jobs and new opportunities. But it is also important for us to re-emphasise the need for them to go through training. As many of these workers have been in the same employment for many years, now that they have to switch jobs and look for new jobs, it is important to make sure we find ways to enhance their employability. There are many basic employment skills which some of the jobseekers do not possess. So I will encourage these jobseekers to approach our CDC Career Centres or they can approach e2i under NTUC. The career counsellors there will then be able to help these jobseekers more specifically – to identify their needs for training and opportunities in the various sectors. I think by doing so, we will then be able to enhance their employability and help them find jobs faster.

Sir, I would like to ask the

Minister whether the Government has any specific plans to help fresh graduates join the labour market. In particular, are there more schemes like what MAS, SPRING and CDAC have recently announced to subsidise fresh graduates joining the labour market?

Sir, I think a number of schemes have been announced recently. EDB, for example, has a number of schemes, including PREP-UP which is targeted at the Science and Technology graduates to retain their expertise within the industry and to capture the necessary manpower for our economy to continue to grow. MOM, together with the various agencies, will continue to explore ways to help graduates to secure employment and to find opportunities for them to continue to develop themselves, including further studies and further education.

Minister, I noted in your speech that the number of PMETs and polytechnic holders and above who were retrenched last year was about 37%. Are we sufficiently geared to help this group? I know the e2i and WDA, in terms of the scope, have always been geared towards the lower end of the workers' spectrum but this time around, the challenges are different. The opportunity should be different and the way to tackle the strategy should be different as well.

Sir, indeed, I think the challenges faced by PMETs are quite different from the rank and file. We recognise that and, in fact, over the last few months we have been beefing up our CDC Career Centres, as well as our various Continuing Education and Training centres, so that we will be able to provide career counselling and support for the PMETs. I think many of these PMETs will also need to be flexible and they will have to consult our career consultants so that we can help them profile their needs, expertise and capabilities. I think by

doing so, we will be able to enhance the matching process between the jobseekers and the jobs.

Sir, we have been hearing that there are jobs available again and again. But I think the real situation out there is that for those who are unemployed, they just find it very hard to find a job. I am just wondering what are the obstacles and what is preventing them from getting a job.

Second, I would like to ask the Acting Minister what is his projection in terms of unemployment rates for the next six to 12 months and would he like to comment on what is reported in the papers today by one analyst who said that our unemployment can hit 6% to 7%.

Sir, let me first answer the first question on obstacles to employment. As I mentioned earlier, I think the challenges faced by PMETs and the rank and file are quite different and we need to address them differently. From our experience, we find that some of the jobseekers really do not possess basic employability skills and we need to train them, and to help them acquire these skills. Some of the jobseekers may need to be prepared to switch industry because the industry they were in was no longer growing so they have to look for opportunities in other industries. This conversion process will also take sometime and we will continue to help them to do so.

There are also jobseekers who are less flexible and we need to help them and encourage them to be more flexible. I will just give Members an example. I think we read in the newspapers over the weekend that the bus companies are looking for bus captains and bus leaders. They have, I think, 280 vacancies, 220 applied and only 77 turned up for interview. I think jobs are still available at different levels and different categories of jobs. If we are

more flexible, we will encourage our jobseekers to be more flexible and we will be able to help them find jobs faster.

With regard to the second question on unemployment rate, I have mentioned repeatedly that rather than focusing on projection and estimate, it is more important for MOM, our various agencies and tripartite partners to focus on the ground on helping individual jobseekers find jobs. So we have been working together through Jobs Credit as well as through the SPUR programme to minimise job losses. Whenever there are job losses, we find different ways to help those that are affected so that they can find jobs faster, and we also work together to give them training and upgrade so as to enhance their employability. I think this is the focus of the Ministry.

7. Mrs Josephine Teo asked the Acting Minister for Manpower (a) how has the economic downturn impacted the number of foreigners in the workforce; and (b) whether the Ministry will review the need to fine-tune our policies on foreign manpower in light of the downturn.

Sir, with the recession and falling demand for workers, the number of foreign workers will naturally go down. Foreigners' share of redundancies in 2008 was roughly in line with the proportion of foreigners in our workforce. The impact of foreign workers is likely to be felt more in sectors like manufacturing than in other sectors like construction which still has several projects on hand.

As I mentioned in Parliament during the Committee of Supply (COS) debate, MOM will fine-tune our regulatory framework to improve the skills and quality of our foreign workforce. I mentioned that we will raise the criteria

for S Pass to improve the quality of S Pass workers coming here. We have also reviewed the qualifying criteria for skilled work permit holders to ensure that only better skilled and better qualified workers will benefit from the lower tier of levy for skilled workers. We will brief the various industries on these changes.

Sir, faced with the downturn, some may think that by sending one foreign worker home, one more job will be created for Singaporean workers. This is not necessarily the case. Sending foreign workers home may mean losing the business altogether and all the Singaporean jobs along with it. Instead, it is far better to help Singaporean workers become more cost competitive and resilient so that they are more attractive to the employers and they can take advantage of the opportunities still available. The Government's assistance has been significant. The Resilience Package, which includes SPUR, Jobs Credit and WIS Special Payment, will help companies cut costs, remain viable and save jobs. It will help Singaporean workers to re-skill and up-skill so that they are better able to retain their jobs and to find new jobs. It will also build new capabilities in our economy to prepare for the recovery.

Sir, in summary, even as we address the short-term challenges of the downturn, we should not undermine our competitive advantage of a flexible labour market. Singapore has to remain an attractive place for businesses in order to retain those which are here and to continue to attract new investments and bring in more and better jobs for Singaporeans.

Mr Speaker, Sir, I thank the Minister for his explanation. Non-Singaporeans comprise about one-third of our workforce and

as the Minister has acknowledged, job losses have mainly come from the manufacturing sector where the proportion of non-Singaporeans in the workforce is proportionally higher, so I would have expected that redundancies attributed to non-Singaporeans would be proportionally higher than one-third. This does not appear to be the case. Could the Minister please explain why?

Just two more questions. One is on the tightening of the S Pass criteria. Could I ask the Minister whether he would also consider not just tightening the criteria but also looking at the level? In other words, looking at the quota that is being allowed under S Passes, I would like to know whether the number of S Pass holders in Singapore has been lowered proportionally as our economy has shrunk.

Sir, let me thank the Member for the questions. The proportion of foreign workers versus local workers being retrenched or being made redundant depends to a very large extent on the sectors that are affected, as Members have pointed out. In particular where services and banking sectors are concerned, I think by and large they are manned by local workers and therefore whenever these sectors are affected, we tend to see local workers being affected. In the manufacturing sector, for example, we see a mix of local and foreign workers. We also have to take into consideration that for some of these foreign workers, their contracts were not renewed. Redundancy only takes into account contracts that are terminated prematurely. So we have to take all these factors into account. I would advise Members to take these numbers with a pinch of salt, and try to understand the factors that are affecting retrenchment process rather than looking at the numbers coldly.

Secondly, with regard to the question on foreign worker quota, as I mentioned in

my reply, it is important for us to ensure our economy remains robust, vibrant and flexible so that we will continue to attract new investments. It is important for us not to send the wrong signal to the investors,otherwise it will affect our long-term cost competitiveness and attractiveness for foreign investments. I would rather look at how we can help Singaporeans become more competitive rather than to stop the foreigners from coming. We have two choices. I think the approach to help Singaporeans is more effective. We have done so through Jobs Credit, we have done so through the SPUR programme and by helping Singaporeans become more attractive, more employable, this will enhance their employment opportunities. This not only will help us in the short term during the recession, it will also build resilience and capability for the economy in the long term within our local workforce. So, that has been the approach that we are looking at.

With regard to the specific question on S Pass numbers, I think the growth in S Pass numbers is slowing down in line with the economy. As I mentioned in my reply, if the economy continues to slow down, the overall number of foreign workers will come down.

Sir, I have a similar supplementary question with regard to work permit holders.

I would like to ask the Acting Minister how many new work permits have been issued in the past few months, given that there are so many stories of foreign workers already here on work permit not having work or not having enough work. Why are new work permits still being issued?

Mr Speaker, Sir, in response to the question, the overall number of foreign workers including work

permit holders will be released on a quarterly basis. The number will be available sometime in April for the first quarter.

With regard to the number of foreign workers here who have no jobs, I think I have answered that parliamentary question (PQ) sometime ago. The number of foreign workers that have employment disputes in Singapore remain very small compared to the overall size of the foreign worker population in Singapore. It constitutes about 0.4% – I am recalling from memory – 0.4% of total foreign worker population in Singapore. Therefore, the conclusion is that overall, the vast majority of foreign workers who are working in Singapore are productively engaged. They do have work and they are paid according to their contracts with their employers.

There is a small number of workers who have employment disputes – the Ministry will do what we can to help them resolve their disputes. We do expect that this number to grow over time given the economic slowdown, just like Singaporean workers who may face retrenchment problems and we have just answered the earlier question on the foreign workers who may have to be released or made redundant. So, increasingly we do see an increasing number of foreign workers who may not have jobs going forward. Some of the contracts may have been terminated or may have been delayed, or some of the new contracts, new projects may not have commenced. So, I think we have to expect that to happen. What is important for us is to ensure that the workers who encountered such problems should approach the Ministry and we will help them wherever we can.

The employers should continue to act responsibly. If they are no longer able to support the foreign workers because they have lost their contracts or the contracts have been terminated, I think these employers will then have to repatriate

these workers after settling all the salary issues and employment issues. So going forward, we will continue to see volatility in the labour market, some sectors will be doing better than the others and we will monitor the situation carefully and, if necessary, we will come out with additional measures to help Singaporean workers.

Sir, whilst I understand the Minister's rationale not to erode our competitiveness, especially for the export-led sectors like manufacturing and, therefore, not to review the allocation policy between local and foreign workers, I would like to ask the Minister's comments with regard to the non export-led sectors, the non tradeable sectors, whether there is scope to review the current allocation criteria, especially restaurants and other services.

Sir, I think from the Ministry's point of view, we have to be careful in micro-managing our overall manpower policy. It is important for us to look at the manpower policy with an overview so that the various quotas are imposed on various sectors. If we start to micro-manage each different business, each different service, each different industry or company, I think we will run into many difficulties and problems, and there will also be a lot of abuse and leakages in between the different businesses because companies are not well defined.

So, I think it is important for us to maintain overall sectorial control in the regulation of foreign manpower quota system. At the same time, we also have to step up enforcement efforts which the Ministry is doing to ensure compliance to our regulatory system and to make sure that our overall framework of foreign manpower management will not be

undermined by unscrupulous employers. Sir, I think that is an important element of our enforcement.

Mrs Teo, last question. One question only.

Thank you, Mr Speaker, Sir. I would just like to clarify that I am not suggesting that we target non-Singaporeans for redundancies and tweak our foreign manpower policy in such way as to discriminate against companies who legitimately bring talents to grow their businesses. The Minister did say that the growth in the S Pass holders is slowing down, which suggests that it is still positive growth. In this economic climate, may I ask the Minister, would this not be a cause for concern?

Sir, I think some of the growth came from sectors where there is still growth. In fact, there are also opportunities for Singaporeans in these sectors. So, I think it is important for us to focus on how to help Singaporeans capture these opportunities. Through SPUR we will be able to equip our Singaporeans with the necessary skills and it is also important for us to ensure that while we continue to be flexible in our labour market, the quality of our workforce will continue to be upgraded.

We have introduced SPUR to help local workers to upgrade and we want to tighten the criteria for the foreign workers so that the foreign workers' quality will also be upgraded in line with the overall quality.

To answer her question, there is still growth in the S Pass overall numbers but I think going forward, with the economy continuing to slow down, we expect the numbers to come down as well.

Mdm Halimah, last question. No, next question, not last question.

8. Mdm Halimah Yacob asked the Minister for Health (a) what measures are in place to ensure that fees of community hospitals remain affordable; (b) whether more assistance will be provided to these community hospitals if their donations are affected by the economic downturn; (c) whether the Ministry will consider reviewing the means testing criteria to align them to those of the public hospitals; and (d) what is the impact on the Ministry's efforts to encourage patients to move from acute hospitals to community hospitals.

By design, community hospitals (CHs) cost less to run than acute hospitals. They are less capital, manpower and skills intensive. This does not compromise care because the patients admitted there do not require the intensive treatment offered by acute hospitals. The cost of running the community hospital is about one third the cost of running an acute hospital.

The Ministry of Health subsidises many patients for their community hospital care. Our subsidy extends up to middle income Singaporeans, say, with a monthly income of $5,200 per month for a family of four. Patients can use Medisave to help pay their bills and MediShield also covers the hospitalisation in community hospital for those who subscribe to it. For patients who still have financial difficulty paying the bills, Medifund provides the safety net. In addition, the community hospitals run by charities raise funds, as part of their social mission, to help provide financial assistance to patients in need.

Last year, my Ministry increased the subvention to community hospitals to help them and their patients cope with the

economic slowdown and we will do more as we discussed in last month's Budget debate.

I have explained before why means-testing in community hospitals and acute hospitals is not identical although both share the same objective of wanting to help the low income group. I have feedback that some patients get missed out at the margin. I am studying this problem and I am confident that I can fix this anomaly.

Patients who no longer need acute hospital care and can benefit from community hospital care will save money if they transfer to a community hospital. We set up the Agency for Integrated Care to strengthen discharge planning and facilitate transfers. The number of admissions to community hospitals has been increasing steadily. We are also getting acute hospitals to collaborate closely with community hospitals to make the transfers hassle free. Tan Tock Seng Hospital and Ren Ci community hospital formalised such a collaboration recently and we encourage other hospitals to do the same.

Sir, I thank the Minister and while I welcome the Minister's proposal to look at those affected and who are at the margins, I would like to ask whether the Minister would be kind enough to extend the margins so that they are not so narrow because the community hospitals' means-testing is different from the public hospitals – it is a lot more stringent and because of the substantial increase in the hospital fees of community hospitals, a lot of middle income Singaporeans are affected. In the case of one hospital, the C class ward has gone up to $3,900 per month in terms of the ward charges.

My second question to the Minister is: how many patients who are in the community hospitals are receiving subsidies and this constitutes how many

percent of the total number of patients residing in the community hospitals.

As I have said, Sir, I am studying this anomaly at the margin to make sure that patients do not lose out when they move from acute hospitals to community hospitals. Otherwise it would not work because if it does not save you money, then why should you go to community hospitals. I am studying this problem and I will fix the anomaly. I am quite confident I can do that.

As to how many of the community hospitals patients are subsidised, if I recall correctly, I think about half.

Ms Denise Phua, last question.

Sir, if healthcare is considered an essential service that should normally be provided by the State, I would like to ask the Minister to clarify why is Government not running the community hospitals. Afterall, Ren Ci Hospital itself is run now by, I think, an MOH-appointed CEO and is located right next to the Tan Tock Seng Hospital. Are there not any benefits to, for example, reaping economies of scale? So, where is the line drawn or decision criteria by which Government makes decisions on whether or not to run a facility, especially in a service like healthcare?

Ms Phua raised an interesting question, which I have been reflecting as well as to whether is it better that community hospitals come directly under the Ministry of Health.

In fact, when it started, it was under the Ministry of Health. As a young officer, I was involved in planning the first community hospital, the Ang Mo Kio

Community Hospital. But, subsequently, the Ministry felt that it was worth trying out to see if charities could run community hospitals. That was how the change came about.

I do not think it is critical, one way or the other, that we must be the provider or we must not be the provider. But we know we will always be the financier for the lower income group because that is our job to make sure that the low income can afford essential services, whether in acute hospitals or in community hospitals. Whether the provider must necessarily be the Government, I think one can debate on such an issue. The key point is that they must be competent, are able to do the job and do bring additional value to the table. I believe they do.

9. Mr Siew Kum Hong asked the Senior Minister (a) if he will provide an update on the MAS investigations into alleged mis-selling of structured products by financial institutions (FIs); and (b) since January 2009 (i) how many new complaints of mis-selling have been filed against FIs and in respect of what products; (ii) how many settlement offers by FIs have been accepted and rejected; and (iii) how many complaints have been filed with the Financial Industry Disputes Resolution Centre and how many of these complaints have been resolved.

Mr Speaker, Sir, Mr Siew Kum Hong has asked for an update on investigations by MAS, the number of new complaints filed with Financial Institutions since January 2009, an update on the settlement offers made to investors, and the number of claims lodged with the Financial Industry Disputes Resolution Centre (FIDReC).

First, on the update of MAS' investigations. MAS has completed its investigations. In accordance with its normal practice, there is a due process to be followed, including giving the Financial Institutions a reasonable opportunity to respond to the preliminary findings, before MAS makes and announces its final decision. Until MAS' findings are finalised, it is not appropriate for either MAS or the parties involved to comment further on the matters under investigation as it could be prejudicial to the investigation and the parties involved.

Second, on the complaints to the Financial Institutions and the Settlement Offers. Regarding complaints filed with the 10 Financial Institutions that sold DBS High Notes 5, Lehman Minibond programme notes and Merrill Lynch Jubilee Series 3 LinkEarner Notes,

since my last update to Parliament in January, these institutions have received another 367 complaints. This number is accurate as of 15th March 2009. As for the settlement offers that have been made by these financial institutions, as at 15th March 2009, 79% of investors who received settlement offers have accepted them, 1.5% have rejected the offer and the rest have yet to decide. For Pinnacle Notes Series 9 and 10, I have been told that the five financial institutions that sold these products have, since my last update to Parliament in January, received another 31 complaints. Again, this number is accurate as of 15th March 2009.

Finally, on the update on complaints filed with FIDReC. MAS has been informed by FIDReC that as of 15th March 2009, there have been a total of 561 formal claims lodged with FIDReC. 336 of these claims are for Lehman Minibond programme notes, 161 for DBS High Notes 5, 44 for Merrill Lynch Jubilee Series 3 LinkEarner Notes, and 20 for Morgan Stanley Pinnacle Series 9 and 10 Notes. 485 claims are pending mediation

and 42 claims have been referred to adjudication. 34 claims so far have been resolved at the mediation stage. In 32 of these 34 cases, the parties entered into some form of settlement, and in the remaining two cases, they have decided not to pursue the matter further. As I had previously indicated, the time taken to resolve a particular complaint would really depend on factors such as the complexity of the dispute and when the parties involved are available for the meetings or the hearings.

Mr Speaker, Sir, I have two supplementary questions. My first question is to ask the Minister what is the expected date of announcement of the final decision by MAS in its investigations given that now the preliminary findings have been made and there is a due process going on. My second question, Sir, is with regard to the recently-announced consultation paper by MAS on changes in regulation. My question is whether the proposed changes as set out in the consultation paper implied that MAS was lax in any way in regulating these products. If MAS was not lax and financial institutions (FIs) did, in fact, breach the then prevailing regulations, and these proposed changes are merely to tighten them further, then what will MAS do to ensure that FIs do not, in any legal proceedings, make the unmeritorious argument that the fact that MAS is proposing new regulatory changes, means that MAS was lax and that what they had done was not prevented by then-existing regulations?

Sir, as I mentioned in my reply, there is a due process and MAS is giving the financial institutions a chance to respond to its investigations. The final investigations should be completed soon. MAS will make a press release as necessary. On the consultation paper, as I mentioned in my earlier clarifications to Parliament, our approach to regulation of financial products remains

the same. I think we want to be able to give Singaporean investors the choice that is available because there is a wide range of investors. It is not possible for us to be overly prescriptive, so we need to strike a balance. Overall, regulatory authorities all over the world have looked at what is happening and they have made changes to their regulations. MAS, being a responsible regulator, has also done so. It has collected views from all the stakeholders, put up the paper for consultation and we are now in the process of receiving feedback. This does not mean that MAS has been lax in its regulations. We do recognise that structured products have become more complex, the environment has changed, and, therefore, as a responsible regulator, MAS also has to make the adjustments.

The following Question stood in the name of Mdm Cynthia Phua –

10. To ask the Senior Minister (a) whether he will give an update on the number of credit card defaults in the past six months; and (b) whether MAS will ask credit card companies to refrain from using various gimmicks, such as giving out crossed cheques when they are in fact debit notes, to lure cardholders to spend.

11. Miss Penny Low asked the Senior Minister in view of the lowering of the minimum annual income threshold for unsecured credit facilities from $30,000 to $20,000 (a) what measures are in place to help ensure financial prudence on the part of both the creditor and debtor; and (b) whether there will be a danger of a sub-prime loans situation that affects heartlanders, especially given the downturn situation.

Question No. 10, Sir.

Mr Speaker, Sir, may I have your permission to take Question Nos. 10 and 11 together?

Yes.

Both Mdm Phua and Miss Low asked about the measures in place to regulate the credit card and unsecured credit lending practices of financial institutions (FIs). The unsecured credit rules are now applied in a consistent manner to both moneylenders and FIs. This is not a loosening of the rules. For the moneylenders, in fact, the new rules reflect a tightening. Overall, the new rules which set the annual income threshold for access to unsecured credit at $20,000 and the credit limit for this group of borrowers at two months their income, allow these Singaporeans modest levels of unsecured credit which they may need from time to time. They may also reduce the risk of such individuals turning to unlicensed moneylenders. Consistent with this objective, MAS has not lowered the minimum annual income threshold for credit cards, which remains at $30,000, as these are typically used to finance consumption expenses.

MAS has introduced several measures to mitigate the risks of over-borrowing by individuals from all income groups. These include more explicit requirements on disclosure to customers of charges, rates of computation, and consequences of late payment with regard to these cards and facilities. Banks and card issuers are also required to conduct comprehensive checks with the Credit Bureau before granting each new credit or charge card, or unsecured credit facility. The credit report sets out the number of credit lines the applicant already has and his repayment record. FIs are expected to

take these into account in deciding whether to extend further credit.

Under the new rules, FIs are not allowed to make offers of unsecured credit facilities to customers, unless the customer has requested for these in writing. This follows similar restrictions on unsolicited offers of credit cards that are already in place. This means that, with effect from 1st March 2009, financial institutions are prohibited from sending any articles – such as cheques – that an individual can use to draw down on an unsecured credit facility, unless he has requested for the facility in writing, or unless the unsecured credit facility has previously been granted to that individual.

To date, the level of credit card debt level has also not deviated much from the historical average. The charge-off rate, which measures credit card debt written off by banks and card issuers, as a percentage of the rollover balance, has kept within the range of 3% to 4% over 2007 and 2008. There was a modest increase from 3.7% in Q3 of 2008 to 4% in Q4 2008. This compares with over above 8% during the SARS period. Credit card balances rolled over for a month or longer, which may indicate that some cardholders need longer than one month after due date to pay their credit card bills, averaged 15% in 2008. There was no noticeable increase in Q4 2008 from this full-year average. The 15% average for 2008 is comparable with the five-year average of 17% between 2004 and 2008, and below the 20% to 25% range recorded during the peak period between 1999 and 2003. Despite a slight increase in the ratio in January 2009, it is still too early to draw firm conclusions. MAS will continue to monitor these indicators. Mr Speaker, Sir, lenders and borrowers both have a role to play in ensuring the use of unsecured credit and credit cards is responsible, sustainable and within the means of the borrower. The national financial education pro

gramme, MoneySENSE, continues to work with industry associations such as the Association of Banks in Singapore (ABS) to educate consumers on the importance of saving and prudent borrowing.

12. Ms Sylvia Lim asked the Prime Minister whether he has appointed the Electoral Boundaries Review Committee and, if not, whether he intends to do so within the next three months.

Mr Speaker, Sir, on behalf of the Prime Minister. The Prime Minister has not yet appointed the Electoral Boundaries Review Committee, nor has he decided when to do so.

Mr Speaker, Sir, some clarifications for the Deputy Prime Minister. One, will the Prime Minister make a public announcement when he does appoint the Electoral Boundaries Review Committee, because this is a matter of public interest and I do not think we should have to keep filing questions to ask this fact? Secondly, how long after the appointment is the Committee expected to take to complete its work? Third, could the Deputy Prime Minister also clarify what the Electoral Boundaries Review Committee will take into account in drawing up the boundaries, besides population changes? And four, can the Deputy Prime Minister, on the Prime Minister's behalf, give an assurance that after the boundaries are announced, there will be a reasonable time lapse between that date and Polling Day?

Mr Speaker, Sir, under the law there is no legal requirement for the Prime Minister to appoint Electoral Boundaries Review

Committee or Commission, but the Prime Minister has done so by convention and so, one would be appointed. Public announcement of the appointment of such a committee does not serve any meaningful purpose. I think the main interest in people wanting to know of the boundaries report is that when the Committee's report is announced, how much time there would be between the announcement of the report and the time when the Parliament is dissolved. I think that relates to her other question. Much depends on the circumstances at the time and whether the Prime Minister decides to call for Elections soon after the publication of the report. But as I have said in the House previously, there will be as much time given as possible. It is too early to make any decision now because no Committee has yet been appointed. What will the Committee take into account? It will take into account population shifts, the increase in population and some other matters which the Committee will have to decide.

The following Question stood in the name of Mdm Cynthia Phua –

13. To ask the Minister for Transport in respect of the recent public transport fare revision (a) why the quantum of fare revision by the transport operators is not in line with the drop in oil prices; (b) whether the Public Transport Council will adopt greater transparency in explaining how revisions are arrived at; and (c) what is the average number of passengers (i) who take single journeys; and (ii) who take multiple transfer journeys.

Question No. 13, Sir.

Mr Speaker, Sir, Mdm Cynthia Phua asked why public

transport fares have not fallen by a similar amount as oil prices. This is really a question about the link between oil prices and public transport fares. When the Public Transport Council (PTC) decides on fare adjustments each year, the adjustment is based on a formula that is pegged to changes in the Consumer Price Index (CPI) and the Wage Index (WI) over the preceding year, and not oil prices. Oil prices, therefore, impact public transport fares only indirectly through their impact on the CPI. This means that fares will not fluctuate to the same degree as oil prices, as oil impacts the various components of the CPI to different degrees. Furthermore, an increase in one component in the CPI may be offset by falls in others. Thus fares will not drop as much when there is a dramatic drop in oil prices. But equally, when oil prices shoot up, fares will also not shoot up as much either. We explicitly decided not to allow direct pass through of fuel and wage costs to commuters by the operators. This is to give operators every incentive to operate efficiently, and keep costs as low as possible. This was why last year, despite a 40% increase in diesel prices, the increase in CPI and WI was only 2.1% and 6.9% respectively, leading to an allowable fare adjustment of just 3%. As the PTC also made the operators absorb a large part of the increase in transfer rebate then, fares went up by only 0.7% in October last year. So, the fare formula not only incentivises the operators to be efficient, it also moderates the effects that drastic spikes in oil prices have on public transport fares. In this way, commuters are protected while the public transport system is kept sustainable.

Mdm Phua suggested that the PTC adopt greater transparency in its deliberations. In fact, the maximum allowable fare adjustment each year is transparent, as it is determined by a formula based on publicly-available

indicators such as CPI and wages. Conditions for deviations from the formula are also specified in the 2005 Report of the Committee on the Fare Review Mechanism. If and when a deviation is warranted, the PTC will clearly explain its decision, as it did in 2007 when it rejected the operators' applications to increase train fares.

However, the recent announcement by the PTC and operators to reduce fares was outside the fare review framework. This was because the operators had decided not to apply for a fare increase under the fare review formula this year. Being mindful of the current economic conditions, they instead took the initiative to work with the PTC to pass on more than the savings they will receive from the Budget measures to commuters.

Together with the PTC, they decided on an overall 4.6% reduction in bus and train fares. This is a significant reduction as it more than offsets the fare increases of the past three years combined (0.7% in 2008, 1.1% in 2007 and 1.7% in 2006). Commuters on the whole will pay total fares that are less than what they paid in 2006.

Some commentators have presented the fare reduction package as only a 2 cents reduction. This is misleading. We need to look at the whole fare adjustment. This year, the fare adjustment formula allows for a fare increase of up to 5%, or 6 to 7 cents. On top of foregoing this 6 to 7 cents fare increase, the operators decided on a further 2 cents reduction across the board, and the PTC concurrently increased the transfer rebate by 10 cents. So the fare reduction package is not only "2 cents", but in fact "2 to 14 cents" per journey. For journeys that involve more then one transfer, the reduction is even more, 26 or 38 cents.

In working out the fare reduction package, the PTC had sought to benefit

as many commuters as possible, particularly those who make transfers. Currently, six in 10 commuters, a majority, make at least one transfer a week. These commuters will enjoy significant savings because of the increase in transfer rebate.

In fact, all commuters will benefit in the longer term from these changes. The increase in transfer rebate brings us closer to distance-based through-fares, where a direct journey will have the same fare as a transfer journey of comparable distance. By reducing and ultimately eliminating the transfer penalty, all commuters would be given more choice over the routes for their journeys. They would not be penalised for choosing to make transfers if doing so were faster, more direct or provided a better travel experience.

Sir, supplementary question for the Minister. Is it correct that the price of fuel affects the operating cost of the public transport operators? And is it also correct that the second order consideration for the PTC, after having applied the formula which the Minister described, is to test the proposed increase against the returns that the public transport operators are getting and, therefore, make adjustments in accordance to that?

The Member is correct. The fare review mechanism spells out when the PTC can deviate and what are the factors they take into account. The return on total assets (ROTA) is one of the reality checks that the PTC has to take into account.

Sir, does this not mean that fuel price has an impact on fare adjustment?

Insofar as it impacts the CPI and the ROTA, yes it does, but indirectly.

Last question, Mr Foo.

Sir, a follow-up question for the Minister. The Minister describes the CPI and the WI, the average, and then there is a productivity extraction, which basically forms the basis of the formula. If the WI and the CPI were to drop because of sustained or prolonged economic downturn, would fares be decreased?

It is very useful to read the fare review mechanism. It is found on the PTC website. It specifies that if the fare formula is negative, which means both fall, the PTC has the power to order a fare reduction, for example, next year. It is part and parcel of the whole fare review framework.

14. Mdm Halimah Yacob asked the Minister for Education what immediate measures will the Ministry put in place to protect students from poor governance and standards and loss of fees pending the introduction of the Private Education Bill later this year.

15. Assoc. Prof. Kalyani K Mehta asked the Minister for Education (a) when the academic quality accreditation scheme for private schools/universities will take effect; (b) what new strategies the Ministry has to effectively address the problem of bogus teachers in the private school industry; and (c) whether the Ministry intends to do a comprehensive inter-ministerial review of the current state of private schools in Singapore.

Mr Speaker, can I have your permission to take Question Nos. 14 and 15 together, please?

Yes.

Mr Speaker, a Private Education (PE) Bill will be moved in the second half of this year to provide powers to better regulate the private education sector and the set up of the Council for Private Education (CPE). Once this PE Bill is passed, the CPE comprising members from the fields of education, quality assurance and business will implement the enhanced registration regime and the voluntary quality assurance scheme, called EduTrust. The CPE expects the first Private Education Institutions (PEIs) to be registered under the enhanced framework by the end of this year after the Bill is passed, and with all eligible institutions to be registered within an 18-month timeframe from then. The first PEIs to undergo EduTrust certification can be expected around the first quarter of 2010.

Besides regulation, the CPE will also take on roles of developing the private education industry, including fostering greater industry stewardship and consumer education. This will be a holistic approach to uplift the overall quality of private education players.

Prof. Mehta asked about inter-Ministry approach and, indeed, that is the approach that we are taking because we recognise that this private education sector requires a whole-of-government response. So the CPE will be working closely with various stakeholder agencies such as Economic Development Board (EDB), SPRING Singapore and Singapore Tourism Board (STB), and other inter-agency collaborations. The basic aim is to improve the quality of our private education institutions as well as to promote consumer education. We have senior representatives from EDB, SPRING Singapore and STB appointed to this Council and this will further facilitate collaborations.

As part of the registration process in transiting to the new regulatory regime, PEIs would be required to submit and disclose key information concerning their courses, teaching staff, student enrolment, facilities and other business operations. The data submitted by them will also serve as a useful update on the local private education sector which the Council will use in its planning, review and oversight activities, with respective stakeholders.

Prof. Mehta also asked and expressed concern about bogus teachers in these institutions. The new regime will tackle this issue in three ways.

Firstly, we will stipulate the requirements for a teacher to possess educational qualifications generally of at least one level above the programme he or she will be teaching. So if you are teaching a diploma, you ought to have a degree. In addition, PEIs must ensure that the teachers' degree qualifications are authentic and recognised by education authorities in their home countries. Officers of the CPE will follow up with compliance checks when they perform on-site inspections as part of their regular enforcement regime.

Secondly, should investigations uncover instances of teachers who do not meet the stipulated requirements, the Council would be able to direct the institutions to cease the deployment of teachers who do not meet the stipulated qualifications. And if it is found that false information has been furnished or material fact has been deliberately withheld, the institutions will also be guilty of an offence under the new regime.

Thirdly, PEIs who apply for EduTrust certification would also be assessed on how their academic staff are recruited, deployed and monitored to ensure teaching quality. Students who want to be more certain of the quality of the

teaching and overall standards of the PEI can rely on EduTrust as a mark of assurance.

Mdm Halimah Yacob asked what interim measures we could take to protect students in the lead up to this new legislation. In the interim prior to the introduction of this new legislation, the Consumer Association of Singapore (CASE) (which administers the "CaseTrust for Education" certification) is stepping up checks to ensure that certified PEIs remain compliant with CaseTrust's requirements in student fee protection and welfare, to ensure that the interests of students remain safeguarded during this economically difficult period.

The new regulatory regime represents a substantive change and adjustment for the private education sector. The Council is currently engaging various stakeholders on the proposed regime through a public consultation exercise, which is open till 6th May. I strongly urge various stakeholders to weigh in, and if there are good ideas or views on how the private education sector here can be improved, these ideas will be incorporated.

Sir, may I ask the Minister, is there any recourse for affected students to address their grouses before the introduction of the Private Education Bill, as CASE has not been satisfactory in addressing these grouses?

Mr Speaker, I think CASE has made improvements but it is presumptuous for me to speak on behalf of CASE because CASE is not under my Ministry. If that is Dr Neo's assertion, perhaps a separate question would suffice.

In terms of what they can do, I think there is specific recourse set under the present regime. But let me say on an overall scale, we can improve things and this is the reason why we want to

introduce a new legislation. I think we all recognise that we have allowed the private educational sector to grow over the last few years and there is a balance between very tight regulation and growth. We recognise that perhaps it is time now to introduce this legislation to tighten the regulations and the enforcement. So, I think that is the basis, moving forward.

Mr Speaker, two supplementary questions, please.

On hindsight, would the Minister agree that the Private Education Bill could have been put up four or five years ago when Singapore was being moulded to become an education hub?

Second question, may I ask the Minister why private schools were not included in the regulatory framework of MOE from the beginning since prevention is better than cure?

Mr Speaker, on hindsight, I could have said many things but I think that is not the point. I think we want to strengthen the regulation.

Let me answer the second question first as to why it was not included. It was included under the general Act but I would say that that enforcement was very light-touch. As I said in reply to Mdm Halimah Yacob's question, there is a balance in reality between regulation and growth. And I think that from what we have assessed, we would like to tighten regulation and that is indeed what we are doing.

Sir, in Singapore's aspiration to be an education hub, can I ask the Minister to clarify what are the success indicators by which the private education sector is measured? For example, would they include the number

of foreign clients who are being let down or not let down, or maybe the number of satisfied clients in this sector?

My second question is who owns the vision or this aspiration of Singapore as a private education hub? Is it MOE, EDB or SPRING? I think when everyone is in charge, then nobody is really accountable or no one might feel accountable.

Mr Speaker, in direct response to that question, the Bill will be tabled by my Ministry, so my Ministry is in charge. But let me also give some perspective. Even with the new regulation, there will still be that balance between regulation and growth. If you really wanted to have a very tight regulatory regime, you would say, well, let us close down 75% of schools in Singapore. Number one, I do not think that is well served. Number two, it is a dynamic process. So when you want to be a globalised city and you allow providers from many countries to come in, we ought to be honest and say that we may not be able to keep tabs with all the developments in the home countries from which these providers sometimes come from or are affiliated with.

So the Council's stance will be that. Yes, it will have enforcement powers. Yes, it will have powers to help students seek redress, mete out punishment or exact penalties. But a lot of its work is also asking these private education institutions to mandate them to provide information. So there must be some form of self-regulation, there must be some onus on students to check on their own, and we will provide the information.

That is the framework that we are looking at. And I would say that it will require the efforts of all stakeholders. But I take Ms Denise Phua's point. It is important for Singapore to maintain its reputation as a quality educational hub. In that sense, we all have ownership of that.

Mr Yeo Guat Kwang, last question.

Sir, may I ask whether the Minister is aware that the CaseTrust Scheme is only aimed at protecting the students as consumers. In the case of any dispute with the school, we have the Student Protection Scheme to help the students recover the fees they paid. But with the recent incidents, you can see that the insurance scheme is still problematic because the school defaulted on the payment of the insurance scheme or did not even buy the insurance for the students. So, I would like to ask the Minister, moving forward, with the new EduTrust, would it have new measures to address this concern.

Sir, let me thank Mr Yeo Guat Kwang for making the clarifications for CASE. We are indeed learning from CaseTrust as we transit to EduTrust. But, again, let me state the qualification. I do not think it is to anyone's interest if we say that this new Bill will give 100% protection. I think it will strengthen it. We will learn along the way, and we will see where we can balance it. But it is a step up compared to what we have today, and I take that it is better organised. That is why the Council will also have representatives from the business sector as well as educational providers who know the environment in which educational providers operate.

I would seek Members' indulgence and also your cooperation in giving your views to the open consultation process that is currently going on.

16. Ms Sylvia Lim asked the Minister for Finance (a) how the 25% fall in overall

portfolio value from its peak is distributed over the different asset classes held by the Government of Singapore Investment Corporation; and (b) whether there is any form of accountability for fund managers who invested "too early" in failing banks.

Mr Speaker, Sir, Ms Sylvia Lim's question has to do with the 25% fall in GIC's overall portfolio value since the peak that Chairman of GIC recently referred to. 25% is approximately the fall in value of GIC's portfolio (in US$ terms) from the time global markets peaked in October 2007 until December 2008.

The fall in value has reflected major declines in the global markets. Global equity markets have fallen by about 45%, using the MSCI World Index or any other leading global indices. Global real estate markets have fallen by 55%, again, based on the commonly used indices. One of the few asset classes with positive returns over the period has been bonds – global bonds have gained in value by about 6%, using the Barclays Aggregate Bond Index.

Almost all institutional investors have therefore seen large falls in their portfolio values over the period. Norway's NBIM (Norges Bank Investment Management), which is Norway's equivalent of GIC, has lost around 27% (in US$ terms) from October 2007 to December 2008. The US university endowments reported average losses of 26% from July 2007 to December 2008. The periods do not exactly match, but this is the available data and you can see the trends are very similar.

Ms Sylvia Lim had also asked about GIC's performance over the different asset classes during this period. GIC has, on the whole, performed on par with market portfolios based on a similar mix of asset classes since the peak in October 2007. But if Ms Sylvia Lim's question

has to do with how GIC's portfolio has been affected by its equity investments, including its high profile investments, the answer is that GIC's overall equity portfolio has moved broadly in line with the relevant global equity market indices during the period – in fact, it suffered a slightly smaller decline than the market indices. Fundamentally, however, it is not appropriate to assess the performance of endowment funds like the GIC or Norway's NBIM over the short-term, or on the basis of individual asset classes or investments. We have to take the portfolio as a whole, and assess its performance over the long term. In other words, not over a year or two, nor from the peak to the trough of a single cycle, but across the market cycles. That is the mandate which the Government has given GIC – to secure good long-term returns on the overall portfolio.

In accordance with this mandate, GIC's strategy is to allocate funds across a broad range of asset classes, including higher risk assets such as equities and real estate, with the aim of achieving good long-term returns. It invests in a diversified portfolio that takes into account the risk and return characteristics of each asset class, so as to achieve better returns for the combined portfolio over the long term. This strategy accepts that individual asset classes and investments may not always do well, but that taken together, and over a longer period, they must contribute to the good overall performance of the portfolio. In other words, GIC consciously accepts the risk that individual investments and asset classes may underperform, especially over the short term, because only by accepting these risks and diversifying its portfolio can GIC achieve better longer-term performance returns.

Hence, during severe market cycles, we must expect to see significant

fluctuations in GIC's portfolio value like we have seen today. This also happened in 2001, when the equity markets collapsed.

However, GIC's returns over the long term have been creditable by international standards. I fully understand why people are concerned about losses in the value of GIC's portfolio during this current crisis. But the recent 25% decline in GIC's portfolio value has to be viewed against the much larger investment returns that it has gained over the last 10 years – besides the more significant gains over a longer period. In other words, despite seeing two major declines in portfolio value, in 2001 and in the current crisis, GIC's portfolio has grown significantly in value over the last 10 years. The 25% decline comes out of a much larger cumulative investment return gained in the preceding years – the preceding five, 10 years.

GIC takes very seriously every decline in the value of its portfolio, including declines in the value of its individual investments, in its tactical reviews. But it will have to keep to its fundamental strategy of diversifying across asset classes, accepting the risks of investing in riskier assets like equities and real estate, and investing for the longer term, investing for long-term gain in other words. That is how it can make the most of its strategic advantage as a long-term endowment fund and continue to deliver good returns over the longer term horizon.

Ms Sylvia Lim also asked about accountability for GIC's fund managers based on their performance. Each GIC investment manager and the fund management team, as a whole, are accountable for their performance.

GIC evaluates its investment managers regularly on the basis of several factors – the performance of GIC's overall investment portfolio, how the team

managing each asset class performs against specific market benchmarks or absolute return targets as well as how the individual investment professional has himself or herself contributed to the team's performance. Consistent with GIC's orientation as a long-term investor, the fund managers are evaluated not just on the performance of their portfolio within a single year, but on a continuing basis and measured against appropriate benchmarks.

Overall, the compensation framework supports a culture of responsibility and ensures that GIC is able to attract and retain the necessary talent to support its long-term performance.

17. Miss Penny Low asked the Minister for Community Development, Youth and Sports in light of the economic downturn and various efforts by agencies like MAS, MOE and SPRING to help defray salaries and training costs of attachments for fresh graduates and professionals in their respective fields, whether the Ministry has any similar schemes and plans to help not-for-profit organisations acquire and train professional workers to run these organisations.

Mr Speaker, Sir, the current economic downturn has provided both a significant challenge to the non-profit and voluntary welfare organisation sectors as well as a great opportunity. MCYS and the National Council of Social Service (NCSS) have therefore been using this time to step up our efforts to recruit, upgrade and retain talent within the sector. Let me cite a few examples.

NCSS has been running a series of advertisements in the newspapers and also participated in career and job fairs in

the last few months in order to highlight job opportunities in this sector. MCYS is also working with Institutes of Higher Learning (IHLs) to increase the number of places available to train social workers and other professionals needed in the social service sector. In order to make this sector more attractive, Members of the House will also recall earlier announcements to introduce accreditation for social work professionals and to improve their working conditions by ensuring that they receive competitive remuneration packages.

There are also a slew of training opportunities in the schemes which we already run, for example, the $45 million allocated to the Voluntary Welfare Organisations and Charities Capabilities Fund. We also have new training initiatives, including an NPO Executive Director Mentoring Programme, and an experiential Social Leadership Singapore programme aimed at developing key leadership in this sector.

In addition, there are also initiatives such as the Sabbatical Leave Scheme and the Professional Leadership and Development Scheme as well as the NCSS Scholar Management Programme which will facilitate scholars' transition into the social service sector. This programme provides mentoring for personal and professional growth. NCSS is also exploring providing a coaching programme for new entrants to help them settle into this sector.

MCYS and NCSS have been working with the Workforce Development Agency (WDA) in order to provide enhanced funding support for social service training under the Skills Programme for Upgrading and Resilience (SPUR). SPUR basically leverages on the extensive Continuing Education and Training (CET) system and includes Workforce Skills Qualifications (WSQ) courses for the Community and Social Service sector. Currently, we have

21 courses available within this sector which will enjoy support from SPUR, and that means people who go through these courses will enjoy a subsidy of 90% of the course fees. In addition, if the applicants are employed by the non-profit sector or the voluntary welfare organisations, SPUR also pays a training allowance of up to $1,000 a month. In other words, they can come onto the employee list of the non-profit sector, be sent for training, enjoy 90% subsidy and receive a training allowance. This is indeed a generous package which we hope will enable us to attract more people to go into the social service sector, especially at a time like this.

As far as social workers are concerned, there is a shortfall of 100 a year. I also want to highlight that we will need about 2,500 new workers in the social service sector over the next five years. Similarly, in the childcare sector, you will know that we are expanding the number of childcare centres. We need 2,000 new people to come into this sector over the next five years. So, the bottomline is that jobs are available, training capacity is available, subsidies are available for training, and training allowances are available. So especially for people, like the PMETs who are unemployed or retrenched, this is a great opportunity to consider a career in the social service sector.

3.00 pm

Order. End of Question time.

[ Pursuant to Standing Order No. 22(3), Written Answers to Question Nos. 18, 20-21, 23-25, 28-36, 40-42 and 44-46 on the Order Paper are reproduced in the Appendix*. Question Nos. 19, 22, 26-27, 37-39 and 43 have been postponed to the sitting of Parliament on 24th March 2009.]

*Cols. 3447-3480.

"to regulate assemblies and processions in public places, to provide powers necessary for preserving public order and the safety of individuals at special event areas, to supplement other laws relating to the preservation and maintenance of public order in public places, and to make consequential and related amendments to certain other written laws",

presented by the Second Minister for Home Affairs (Mr K Shanmugam); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

"to provide for the preservation and protection of national monuments by the National Heritage Board and for matters connected therewith, to repeal the Preservation of Monuments Act (Chapter 239 of the 1985 Revised Edition) and to make related amendments to the National Heritage Board Act (Chapter 196A of the 1994 Revised Edition) and consequential amendments to certain other written laws",

presented by the Senior Minister of State for Information, Communications and the Arts (RAdm [NS] Lui Tuck Yew); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

"to provide for the transfer of the airport undertaking of the Civil Aviation Authority of Singapore to a successor company, to provide for the reconstitution of the Civil Aviation Authority of Singapore, to provide for the regulation of the operation of airports and for the imposition of economic controls at airports, to repeal the Civil Aviation Authority of Singapore Act (Chapter 41 of the 1985 Revised Edition) and to make

consequential and other amendments to other written laws relating to airports",

presented by the Senior Minister of State for Transport (Mrs Lim Hwee Hua); read the First time; to be read a Second time on the next available sitting of Parliament, and to be printed.

Order for Second Reading read.

3.02 pm

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

Rationale for the 1998 amendments to disallow party political films

In 1998, the Minister for the then Ministry of Information and The Arts, Mr George Yeo, spoke in this House to amend the Films Act to disallow party political films. He emphasised the undesirability of the film medium as a platform to conduct political discourse. This was because party political films can be employed to sensationalise or present serious issues in a biased and emotional manner. We should keep politics objective and rational rather than allow emotions to be whipped up in place of rational responses.

Rationale remains valid

The purpose of the restriction was to ensure that people debated politics seriously and not allow it to be reduced to a contest where political parties and candidates promote themselves through camera angles, sharp and slick editing techniques or emotive, slanted presentations. This purpose remains valid. However, the world has changed over the

past decade. The web is ubiquitous and is a major source of multi-media information. Societal norms have evolved. We have to adjust to this new environment while recognising that we still want politics to be treated as a serious matter.

We should not prevent people from recording video clips of political events held in accordance with the law or from making factual documentary videos of political issues and events. But we must continue to have limits against undesirable political materials, for example, fictionalised accounts or political commercials, even though it may not be possible to enforce these limits completely. Hence, we have tabled amendments to the Films Act. How the parameters in this Bill will be interpreted and where the limits will be drawn can be subjective and a matter of judgment. Therefore, we propose to establish an independent advisory committee, the Political Films Consultative Committee (PFCC), to advise the Board of Film Censors.

The changes we are making are significant ones and will bring our rules up to date. We also recognise that the situation is dynamic and the environment will continue to evolve. We are prepared to make further changes when it is appropriate to do so.

Technological and societal changes

In the decade that has passed since the Bill was first moved, technology has advanced rapidly. Singaporeans are very much plugged in to new media. Household broadband penetration rate is close to 100% and mobile penetration rate is 131%.

The Internet and the emergence of Web 2.0 technology have drastically transformed the way in which information is produced, disseminated, shared and consumed. New media technology has

enabled communities to be formed around shared interests and for people to access information, participate in and be connected across a wide variety of issues, ranging from national and political matters to specific interests and hobbies.

Adept at using Web 2.0 communication tools, many Singaporeans, especially the young, have blogs and Facebook accounts. With the ubiquity of recording devices and widely and freely available editing software, you can shoot a film on your handphone or digital camera, edit it on your computer, and publish your work instantly on the web – on your blog, on your Facebook and share them with friends or on YouTube where the rest of the world can view them.

The texture of our society has also evolved. With better education and greater exposure to the world through travel, globalisation and the Internet, our generation of young Singaporeans today are different. They want more of the following – space for political discourse, greater engagement with the Government, and their views to be taken seriously by the Government. So it is therefore important that the Government learns to make better use of the medium of film and new media tools to reach out and engage, inform, educate and obtain the views of media-savvy Singaporeans.

Global trend

In other countries, we have seen how new media and social networking tools have been used in political discourse. In the 2007 Australian elections, which were dubbed the "Facebook Elections" – Facebook was used extensively by Kevin Rudd, now the Prime Minister, to reach out to young voters. The US presidential elections last year was dubbed the "YouTube Elections". Presidential candidate, Barrack Obama, had used YouTube

extensively and a spectrum of new media platforms from Flickr to Twitter, to connect with different groups of voters.

Closer to home, the last Malaysian elections also saw extensive use of new media tools and videos by interested parties. While some videos were factually true, many were deliberately misleading and calculated to arouse and stir emotions by portraying only a certain viewpoint and selecting only certain extreme shots.

Indeed, this is one of the downsides to politics conducted over the Internet – videos and advertisements edited deliberately to distort what was said, to cast doubt and to push a certain agenda. Knowing that it was impossible to correct every untruth on every site, candidate Obama set up one website called "Fight the Smears" in an attempt to set the record straight on rumours, gossips, half-truths and lies which were pervasive over the Internet.

Therefore, while videos, films and new media can be widely used and can improve communications, we must be mindful that they can be easily abused. This is the reason why, even as we liberalise, there needs to be some safeguards to minimise the risk that they will be exploited and to reduce the undesirable effects.

Why only certain party political films are allowed under amended Films Act

Sir, the Government recognises that Singaporeans, in particular our young, want greater space for political discourse. Over the years, the Government has liberalised and widened the space for expression and participation, and has encouraged citizens to engage in objective dialogue and participate in building a better Singapore for everyone. When Web 1.0 came on the scene, Government Ministries and agencies created websites and online feedback channels as well as

chat rooms and bulletin boards to communicate with Singaporeans. A light-touch approach was also adopted towards regulating the Internet. With Web 2.0, the Ministries and agencies are also learning to use new media platforms to interact with citizens. Moving forward, the Government will adopt an even lighter touch with the Internet.

Sir, the amendments that I seek to make to the Films Act today is another significant step taken by the Government to further liberalise and expand the space for greater political discourse. With the amended Films Act, we will allow certain types of films which could otherwise be party political films – that is, films that are factual and objective, and do not dramatise and/or present a distorted picture. Now these films will now be allowed with the proposed amendments. Let me explain.

At the start of my speech, I had recapped that the intent of disallowing party political films is to keep a proper balance between the emotive and the rational for political debates in Singapore. This is a necessary safeguard given the experiences of recent elections in other countries. This is because anyone can easily shoot and produce a film, and circulate it widely. With sophisticated editing and computer technology today, one can do almost anything to sensationalise or distort the facts and pass this off as the truth.

As hon. Members would be aware, pictures could be superimposed on one another, doctored or manufactured to make a scene or situation look real when it is not, such as to portray a well-known political figure of a particular religion indulging in the practices of another religion. It can be considered character assassination but more significantly, it is a dangerous act with gross ill intent to stoke religious sensitivities.

Another example is how factual film footages could be edited slickly to remove the proper context of the original footages. Whatever examples we use, whether it is a crude distortion or one that is so subtle and slick that the untruth appears as the truth, the intention is to mislead and confuse the viewers in pursuit of a certain agenda.

At this point, allow me to address the often quoted argument that since the Internet has made it almost impossible to enforce the law, the ban on party political films is meaningless and the Films Act is rendered archaic. Critics argue that such films, including banned films, are available on the Internet and people can watch them and so we should do away with the law altogether.

There are good reasons to make a distinction between what happens in the virtual world and the real world. First, while we recognise that there are practical limitations to prevent all undesirable films from circulation on the Internet, it is sensible and practical not to allow copies of such films from circulating widely and taking root outside of cyberspace. It is still a large and significant audience in the real world. Second, there is a distinct difference in the effect and impact of watching a film alone, for example, through a computer terminal off the Internet and having a group of people watch it together. Unlike an excited individual, an excited group of people can easily fuel and exacerbate the emotions.

Furthermore, regulatory legislation is not just about enforcement. It is also about making a statement on what our society recognises as the acceptable norms and the fundamental standards for what is considered the proper conduct of political debate and electioneering in our country. Our original concerns about films that sensationalise and distort are therefore still valid today but neither should we impose a total ban on all party

political films. In line with the recommendation of the Advisory Council on the Impact of New Media on Society (AIMS), a gradual, calibrated approach in relaxing the regulations on party political films have been taken.

Amendments to the Films Act

The Films Act will be amended to allow for certain types of films which could today be party political films. Currently, all party political films are banned except for reporting of current affairs and films to inform or educate persons on the procedures and polling times for any election or national referendum in Singapore. So there are some amendments that we are making. First, we are amending section 2(3)(a) to spell out more clearly that exemption applies to films made solely for the purpose of reporting of news by a licensed broadcasting service.

Second, we will also expand section 2(3) to allow films that are factual and objective, and do not dramatise and/or present a distorted picture. With the amendments, the following will no longer be considered as party political films:

Live recordings of events held in accordance with the law; (ii) Anniversary and commemorative videos of political parties; (iii) Factual documentaries, biographies or autobiographies; (iv) Manifestoes of political parties produced by or on behalf of a political party; and (v) Candidate's declaration of policies or ideology produced by or on behalf of the candidate.

Films with animation and dramatisation and distort what is real or factual will be disallowed, as the intent of the amendments is to ensure that these films do not undermine the seriousness of political debate.

Mr Speaker, Sir, these amendments will allow much leeway for political parties and election candidates as well as individuals to produce party political films. At the same time, this will allow for political debate in Singapore to remain serious and robust.

Party political films allowed for Internet election advertising

To further liberalise the space for political expression, we have considered carefully and will correspondingly relax the Internet election advertising regulations. Political parties and their election candidates will be able to use films allowed under the amended Films Act during an election period. This goes beyond the recommendation of AIMS, which had, in fact, recommended that there be a blackout period for party political films during an election.

Independent advisory committee to assess party political films

In line with the AIMS’ recommendation, the Government will set up an independent advisory committee to advise the Board of Film Censors (BFC) on whether any film is a party political film, and the film is allowed under the amended Films Act. This will be called the Political Films Consultative Committee (PFCC).

We had earlier announced the Chairman of the PFCC to be Mr Richard Magnus, retired Senior District Judge and Chairman of the Casino Regulatory Authority. Should Parliament pass this Bill, Mr Magnus will then proceed to form the Committee and draw members from relevant fields, for example, the academia,

legal fraternity, labour movement, the print media and the film sector. In consultation with the Chairman, the Minister for Information, Communication and the Arts will then appoint between six and eight members to form this advisory committee.

The PFCC members will exercise judgment to assess if a film is a party political film or comes within the exclusions in the Bill, and give their assessment to the BFC. The BFC and PFCC have a challenging task at hand. As with assessing and rating films with some degree of sex, nudity, violence and coarse language, assessing whether a film is a party political film is not an exact science. There will be an element of subjectivity and there will be grey areas. What is factual, what is not? What contributes to an objective or non-objective film? Members of the BFC and PFCC will have to apply their minds and interpret within the parameters that we have established for them in the Bill.

Process of determining a party political film

Currently, unless exempted under section 40 of the Films Act, all films are required under section 14 to be submitted to the BFC for classification. Films exempted from this include films that are made by individuals not intended for distribution or public exhibition, as long as these are not obscene or party political. Examples of these films that are exempted include wedding celebrations and birthday parties and corporate training videos.

The BFC will assess all films that are submitted to it for classification. Any film that the BFC considers could be party political will be sent to the PFCC for their evaluation and views. The BFC will study the PFCC’s recommendation before making its decision as to the status of the film.

Any owner of a film that disagrees with the Board’s decision can appeal to the Films Appeal Committee, or FAC, which is already provided for in the Films Act. The FAC is made up of private and public sector individuals and its decision on appeal is final.

Mr Speaker, Sir, the amendments that we are proposing will significantly open up a much larger space for political discourse using the medium of film. We trust that individuals, political parties and filmmakers will find ample opportunities to bring their messages across in creative and constructive ways through films that do not distort or dramatise. In doing so, we will continue to keep our political discourse sober and rational.

Sir, I beg to move.

Question proposed.

Sir, thank you for allowing me to kick off the debate on this much watched Films (Amendment) Bill. I will speak about the intent, content and also the process relating to the amendment itself.

Following the widely reported AIMS Committee recommendation, the Government has accepted most of the recommendations, amongst which is a gradual liberalisation of the films, including political films. This Amendment, therefore, is seen as a step in that direction. Yet, the Internet is riled with different opinions, questioning the intent of the amendment. Common questions asked are: Is this really a step towards liberation? Or is this a step backwards to contain certain political parties? Even worse, is this to introduce a catch-all clause to contain even the film producer, videographer and free speech?

First, let us be upfront here. Every country has worries about the ill effects

of unfettered free speech. However, the responses vary dramatically between countries. Even amongst Western liberal democracies, it would be hard to find uniformity. US is often seen to be at one end of the spectrum with its First Amendment which has been used to thwart most kinds of restrictions on free speech, including, very recently, even the attempt to rate pornographic websites! It is preposterous but it happened. Some European countries, on the other hand, have enacted laws against hate speech with relative ease and speed. At the other end, there are countries that purport to protect its citizens from the ill effects of Internet by banning it almost entirely! Again, impossible but it happened. And there is of course all the positions in between. There is, in other words, no international norm. And it is suffice to say that each jurisdiction will have to find its own set of principles that will work for its citizens in a fair and transparent manner, because this is the only way which it can be sustainable in the long term.

I spoke with residents, grassroots leaders and opinion leaders to get a sense of whether there is a common view around this issue in Singapore. And the result? The views are as mixed as a kaleidoscope, and the colours are just as vibrant! While netizens tend to weigh heavily on the side of full liberalisation on political films, and allowing people to judge for themselves, others quoted the bak-chor mee stall story where a rumour can be misconstrued as reality, especially if it is allowed its full song and dance in pictures. Some also felt that politics should be kept clean, and not go down the way of the US or Korea and Taiwan where film stars, celebrities and clever producers were able to juice up serious political contests into a contest of bloopers and laughs, fancy dress competition or, worse, to escalate it into a

competition of who can get the best talent or pay the best producers for the most fanciful or persuasive film for infotainment. Closer to home, as Senior Minister of State has alluded to, in one of our neighbouring countries, illegally filmed footage of the private affairs of political leaders have also made their rounds, with disastrous consequences not just on the candidates, but also their family and community.

So I guess one key consideration in this Bill is how and what do we want our political scene to look like in the long term. Would it be a serious contest where all views and citizens should be able to participate fully, fairly and in a cost effective manner, or one which becomes a costly circus of the fanciful?

Sir, please allow me to clarify that I do not mean to say that full liberalisation or the current proposed form will result in one or the other. Rather, I take the view that versus doing nothing and absolutely nothing from our current position, and hence disallowing all political films, this amendment is a step towards liberalisation and, at the same time, safeguarding against money and showbiz politics – which can be a waste of resources and self-indulgent. But I do have some issues with some of the content of the amendment itself which includes certain problematic areas and words like, I quote, "wholly accurate account" where the word "wholly accurate" is debatable; "no animation" because I do not know of any persuasive films or documentaries today that could be completely animation-free; or "the recording of actual and legal event only". Please let me elaborate. It is questionable if good documentaries could and should be produced "without any animation and composed wholly of an accurate account depicting actual events, persons and situations" and without presenting them in any "dramatic way". Any serious documentary producer’s major concern would be its dramatic

effect in telling the story so as to capture the audience. This is one of the ways in which the best documentaries in the world win awards. Even Al Gore’s documentary, "An Inconvenient Truth", uses animation. Secondly, what is meant by "wholly accurate account"? If it was intended as an injunction against mixing fiction with facts, in other words, distortion of facts, then are there currently known remedies that could better address this situation? I think the proposed Bill should spell out exactly what it means instead of using vague language and broad constructs. To argue that film censorship is more an art than a science, and the Government will use a "light touch", it is little comfort to serious producers on any side of the fence. So, Sir, while I do support not over-dramatising or distorting films into a fanciful circus of acts, I am also saying that having vague terms and constructs will not do serious documentaries with a bit of animation to illustrate certain points any good.

Next, does the amendment also make the filming of illegal activities, illegal? If so, this is even more problematic when licensed broadcasters, including foreign ones, are allowed to film them but ordinary citizens are not. If foreigners are allowed to film and disseminate, while citizens are not, then what is the Government actually trying to prevent? If the argument is that licensed broadcasters are easier to manage under the law whereas individuals/mavericks/rogue filmmakers are not, then reality is not as clear-cut. So long as they are residents in Singapore and are known entities, I think there are some existing laws that can take its course. If, on the other hand, they are unknown and un-catchable, then it may also have the unintended effect of promoting anonymity and further lack of accountability. And by this, I mean that people who want to, will still upload their videos, but they will do it anonymously, via foreign media and, of course,

websites, and perhaps would dramatise it even further just to make their point. Would this, therefore, be worse off for Singapore as a whole?

So I think, at the very minimum, some of these questions need to be answered rationally as much as judgmentally. Hence, I urge the Minister to clearly articulate its intent, and clarify the content of the Bill as much as possible.

And on the process itself, for any government to be credible, it must be seen to be fair to all – regardless of language, religion, culture or political orientation. In this regard, the appointment of the Political Film Consultative Committee should be an open process, and the members of this Committee should be seen as neutral individuals who are reputed for their fairness in their dealings. I am heartened that Mr Richard Magnus would be chairing the Committee. He is known to be a very experienced and independent district judge. And I hope that the rest of the members would also take on that air of neutrality and fairness.

And on the deliberations of the film itself, I think some have also asked should rejected films be given any reason so that they can work out what is acceptable and re-edit the film and re-submit for admission. And how will this process itself be different or would it be exactly the same as other films that are currently submitted to the censorship board for deliberation?

Finally, Sir, I think Singaporeans are highly educated and Singapore is one of the most connected nations in the world, especially the fact that we have very high penetration rates of broadband and the mobile. It is, therefore, important to encourage good political debate and public discourse, so that good views are not driven underground or only pushed to the cyberspace. And, of course, good political discourse and space would encourage iron

to sharpen iron. Open public discourse can also help to mature a society, help citizens to feel a sense of belonging and responsibility to Singapore. Hence, while the amendment is a step forward, it should be accompanied by steps to further encourage the political debate , so that society's critical faculty can become its best defence against any ill influences. And with that, we could further liberalise any political films/acts in the future.

With that, Sir, I support the Bill.

Sir, films are a vehicle through which the right to free speech or expression is exercised and enjoyed. This right is entrenched in Article 14 of our Constitution, the supreme law of the land. This is not an unqualified right in any jurisdiction. The Films Act is one of a multitude of laws restricting the ambit of free expression in Singapore.

Under the terms of Article 14(2) of the Constitution, there are eight exhaustive grounds upon which Parliament may legislate to restrict free speech, if it considers this necessary or expedient, such as to provide for laws on defamation or judicial contempt.

Sir, I must ask a preliminary question which perhaps should have been asked more than 25 years ago in 1981 when the Films Act was born. Which of the eight permissible grounds upon which free speech may constitutionally be restricted does the Films Act rest on?

I ask because this is not apparent on the face of the statute. Its preamble gives no indication of this. It merely states: the Act relates to "the possession, importation, making, distribution and exhibition of films." Perhaps this specific constitutional ground for derogating from free speech rights was clarified in past

parliamentary debates which I may have missed, for which I beg the Minister’s indulgence. But then, as a matter of law, it is always better for the avoidance of doubt to state things expressly rather than leave things to implication or inference. This is particularly important where constitutional rights or limits on constitutional rights are at stake.

When constitutional rights are involved and the law seeks to curtail the rights of citizens, the onus is upon the Government to prove that the restrictions are necessary to serve one of the eight stipulated purposes in Article 14(2).

One might infer from practice, such as the pronouncements in various Censorship Review Committee Reports, that censorship serves goals like preventing harm to the public by protecting the impressionable young from the pernicious influence of salacious and unedifying film and TV content. Personally, I support this worthy goal. Constitutionally speaking, I would infer that this reason falls within a constitutional category which permits legal restrictions on speech – the category being that of "public morality".

However, I am more than a little perplexed with respect to the constitutional basis for the ban on "party political films". The current section 33 makes it an offence to make, distribute or exhibit the creature known as the "party political film".

This current amendment removes the complete ban, which is a very restrictive form of prior restraint that pre-empts speech before it is even spoken, as opposed to imposing sanctions for speech after it is spoken. Which head under Article 14(2) does the regulation and restriction of party political films fall under? It must fall within one of these eight grounds to be a legitimate, constitutionally permissible restriction on speech and expression.

Which ground is it? It cannot be public morality as party political films are a form of what might be called "political speech" which relates to political issues, however defined. The limits on political films cannot rest on public morality as political issues are not on the same level as pornography or obscenity, I hope. It is not a security issue, has nothing to do with friendly relations between states; I do not think party political films constitute an incitement to commit an offence. So, by process of elimination, I would hazard to guess that the regulation of party political films must somehow be related to the category of "public order".

From the 1998 parliamentary debates, it appears that the rationale for the prior blanket ban on party political films under section 33 was two-fold:

Firstly, it was considered a bad or undesirable medium for the message because film is one-sided in presenting a message and ill-suited to effective rebuttal which diminishes the quality of political debate. Further, the medium of film was thought to sensationalise issues, reducing debate to a contest between advertising agencies, which carries the vice of being simplistic without the virtue of simplicity. This was also thought to trivialise serious debate by provoking the emotions rather than eliciting rational reflection.

Sir, I find it hard to see how a concern that party political films might sensationalise and trivialise political debate qualifies as a public order exception, unless we adopt a rather capacious or expansive understanding of "public order". As a legal category, there must be a core set of criteria for identifying a public order issue – it cannot be a "fill in the blanks with whatever you like" category. As an exception to rights, it can easily eat up the norm if so broadly defined. Sir, are the regulations on party political films based on such a broad

understanding of public order? I would appreciate it if the Minister could clarify if this is the case.

Secondly, it was thought that sufficient outlets for expressing political views, like publishing actual or virtual newsletters, already existed. On this point, I would note that from past debates, Opposition politicians, like Mr Chiam See Tong and Mr Low Thia Khiang, forcefully pointed out that although the ban on party political films was neutral on the face of things, it was unequal in impact. All things considered holistically, equality of access to the Internet is not the sole factor to consider when the playing field is not level. For instance, Opposition parties have less access to mainstream media. This is a relevant factor when evaluating the importance of the Internet as a cheap, fast and effective method for getting out a political message to a broad spectrum of citizens.

In this sense, the Internet, with its great communicative power, acts as the great leveller, in mitigating disparate access to mainstream media, or even the variable financial and manpower resources available to the various political parties. It has been called the "fifth estate" for its role in holding government, and even the press, to account.

The Internet is a forum that politicians can no longer ignore; it has real world effects as a mobiliser and alternative information source. It shapes opinion and debate. Twenty-first century politicians must learn to negotiate this brave new terrain, its bright shiny cities of interactive dialogue and transparency and its dark lands of cyber-nuisance and online bullying. You cannot take online party political films out of the mix of alternative informational flows as this is a potent source of communication.

Sir, rational debate over public issues is important, but we also want to debate with passion and conviction, without abandoning the faculty of reason and becoming emotionally charged. Sir, we are not vulcans, worshipping solely at the altar of logic. Passion and intellect are not mutually exclusive. Politics speaks to the head and heart.

It is true that film as a means of communication can be more visceral than cerebral in effect. Unlike the printed word, which requires more active participation and focus on the part of the consumer to determine meaning, we are more like passive recipients in watching film which feeds us with rich visual detail and is apt to sway populist emotions, engaging sensibility rather than sense.

This is particularly so where a rousing soundtrack is added, with soaring strings, to complement stirring imagery, a billowing flag against which the protagonist stands, looking noble. Alternatively, poor lighting and ugly angles can communicate wordlessly that an antagonist is shady, oily, snakey, not to be trusted.

I share the concern that public debate may become sensationalised and thereby trivialised. I share the concern that public debate may be thwarted through propaganda and misinformation where there is a lopsided presentation of views without a chance to rebut and reply. This degrades democracy and the quality of debate which should be conserved.

Apart from free speech fundamentalists who prioritise speech to the neglect of other important competing values, most accept that free expression is not an ultimate value. Free speech has an intrinsic worth as a means of self-expression, but it draws its value from the argument that free speech and debate promotes truth and democracy. As the

House of Lords said in a recent libel case, the freedom to communicate relates to the freedom to communicate information, not misinformation; misleading people does not serve the public interest and misinformation is in fact destructive of democratic society.

Sir, free expression is not an ultimate trump or value in Singapore, but it is an important value in serving truth in democratic debate. Which brings me to the question: why is the blanket ban on party political films being lifted? Is this being done because of a principled commitment to free speech or is it a pragmatic capitulation to the fact that technology has outstripped the state’s ability to police the section 33 ban on party political films?

Sir, section 33 is easily circumvented. Anyone with a cell-phone can make a movie and distribute it on the Internet. Record, upload, download, view. Banned political films are easily located on YouTube and have not attracted Government intervention. The blanket ban has too many holes in it torn by Internet technology.

Technology has outpaced regulatory capacity. However, in formulating laws, we need to distinguish between the desirability of enforcement and the capacity to enforce a legal norm. Laws which are hard to enforce may still fulfil an important social function and educative purpose. For example, the ban on obscene films or pornography signals to citizens what is normative, desirable and sociable. Just because Internet pornography is widely available does not mean we should hasten the deterioration of our moral ecology by lifting the ban and opening the door to mainstreaming pornography which degrades women through perpetuating sexual stereotypes. I urge the Government to retain the symbolic blocking of 100 Internet porn sites as a statement and reaffirmation of our values. Laws

lacking a sound moral basis will breed disaffection among citizens and hemorrhage legitimacy.

However, we are not today dealing with the relatively easy case of pornography, a form of speech lacking value, like slander or invective; such expressions are unworthy of constitutional protection. Instead, we are dealing with valuable speech, with political speech, the lifeblood of a democracy.

Political speech about political issues educates and enlightens us. It facilitates robust and informed debate which heavy-handed censorship can emasculate, to our common detriment. The ideal in a representative democracy is an engaged body of citizens who express competing views and then weigh competing viewpoints.

Are we amending the Films Act out of an internalised commitment to strengthening the principle and practice of expressive freedoms in a democratic society, or are we merely capitulating to the external pressures of social realities and technological capacities? Since we cannot ban it, we may as well regulate it!

In loosening control over political films, it would be sad if we missed this opportunity to reflect upon the important role free expression plays in a democratic society. In a real sense, speech is never free as it always takes place within a context of competing values, social mores and local realities. We apply a cost-benefits analysis to it, in deciding how to value speech and give it due weight where balanced against other important competing rights and interests, such as racial harmony. We must ask: what is good and bad speech, what is the social value of speech, rather than assume the relevant starting point is to begin with a principle of unregulated speech, which itself begs justification.

Sir, this shift from a blanket ban on party political films to a regulated one is to be quietly applauded. It is a small step rather than great leap in the right direction towards the liberalisation of forms of political speech as expressed through party political film on the Internet and beyond. It is progressive precisely because free expression serves the worthy goal of promoting democracy and political participation in at least two respects.

First, permitting certain forms of political films is a step towards enhancing genuine viewpoint diversity by allowing different voices and perspectives to be heard through a relatively accessible platform for communication.

Second, by opening the door to yet another source of informational flows distinct from the mainstream media, which works under certain constraints and predilections. To effectively participate in political discourse, citizens must be knowledgeable about public affairs. If relevant information is withheld, the danger is that the electorate can be manipulated or misled. And this is not conducive to a free society.

By protecting political speech, a government is prevented from illegitimately silencing its own critics. Further, the free speech principle is a permanent challenge to the idea that some questions are beyond contention and thus a permanent challenge to authority.

The problem today is not a dearth of information, frequently, but a deluge of information. This is a wake-up call to citizens to rise to the task of being responsible citizens, able to discriminate between substance and seductive but vacuous sound-bytes. It is unsound to base policy on sound-bytes.

We must have the maturity to ferret out mendacity, the discernment to divide

truth from dishonesty and deception. A discerning citizenry is a maturing citizenry; maturity is also marked by traits of civility, self restraint, a sense of proportion and propriety which are crucial to the long-term sustainability of democratic deliberation.

The fear in lightening up on party political films is that the public will get misled, misinformed by distorted half-truths, riled up or driven to emotional distraction and unfortunate action.

With free speech, we let in the good stuff as well as a good deal of rubbish. Thus, there must be a new social compact of trust between governor and governed that citizens will not, when speech laws are liberalised, embark upon Gullible’s travels but will shoulder the burden of discernment in evaluating the content of the speech communicated by political films. Sometimes, parents have to let go and children have to assume responsibility.

While the price of liberty is eternal vigilance, so too, "personal responsibility is the price of liberty". That said, lifting the blanket ban on party political films is of value to both speaker and hearer. To the voter is presented more information about politicians and their agendas.

This enhances informed decision-making. To the politician, their viewpoints and positions can be directly communicated, through a high impact medium which can spread virally, in the good sense, without third party mediation. They can control their message, guard against misrepresentation and correct errors. This promotes accuracy and truth, two goals free speech is designed to serve.

Now to the nuts and bolts of this amendment. We speak to communicate, to reach the mind of others, to persuade conviction, which is of little worth unless

it is converted into conduct. In relation to party political films, political persuasion is the name of the game and this must relate to garnering political support, including to influence voting outcomes. Making films which are intended to or are likely to affect elections would still be subject to section 33, it appears.

This Amendment seeks to clarify what kind of film is directed towards a political end in Singapore in current section 2(a). This is, to say the least, an ambiguous category.

Ambiguity is not a helpful guide to lawful behaviour – one virtue of the rule of law is providing a stable legal order which sustains a certain degree of predictability in one's environment. This enables us to make effective choices between all the options available to us. Making and exhibit party political films is an offence. If one cannot identify in advance what a party political film is, this may deter the making of films, which may be of great value. Expression will be chilled for fear of falling foul of the law.

Under clause 2 of the Amendment, the Board of Film Censors is mandated to decide what constitutes a party political film for section 33 purposes. The proposed section 2(2)(b) removes the ban by providing that films relating to political matters may now be permitted if they are not partisan or biased.

The existing section 2(2)(b) identifies seven examples of what a political matter is. This includes matters relating to elections, referenda, MPs, Government, political parties and policies. This is a description rather than a definition of political matter. It is pretty comprehensive and would seem to capture, if not colonise, the entire sphere of public life, politics, politicians and policies.

The governing factor in liberalising this regime is to preserve an idealised vision of

elevated political debate which is rational and objective, by weeding out sensationalistic, emotionally manipulative films. Permissible films must be factual and objective; if they are distortive, this does not serve the free speech goals of advancing truth and accuracy of information in democratic debate. Emotion is verboten as it undermines this ideal. The model is a documentary rather than a reality show, dramatisation of a live or historical event or mockumentary.

What criteria is provided to ascertain whether a film is partisan or biased? We are wading in a sea of grey, given the inherent subjectivity of this stipulation. Can a party political film be unbiased? Does not a film-maker have a message to convey, which is driven by his or her opinions and values? Even news coverage by licensed broadcasting services make value judgments just by dint of the choices of which stories are covered and how they are covered, how much face time is given to a politician or otherwise, whether a range of viewpoints are covered fairly and equitably or whether journalistic bias creeps in?

If the opposite of bias is neutrality or impartiality, one must ask, is this even desirable, let alone possible? Can a party political film be neutral on political positions? Politicians must stand for something. This is how voters decide whether to stand with or walk away from them.

Sir, can a film on political matters be non-partisan? What is a partisan or non-partisan political matter? When is a matter political in nature? I can think of three types of politics at least. First, personal politics relates to personal ambition and the pursuit of power, for example, office politics. This sort of personal politics is not what the term party political refers to, I imagine.

Second, partisan politics, which speaks to a certain kind of politics that

depends on formal or informal political alliances and party allegiances. This is the stuff of contemporary parliamentary politics. This would fall squarely into the term party political films. The attempt to portray one political party in a more favourable light, for example, either by promotional propaganda or by attacking one's competitor.

A third kind of politics may be characterised as ideological politics which relate to disparate stances on an issue, which is not party-based. For example, whether a libertarian or conservative approach is taken towards censorship, gambling or prostitution. This could also fall within the definition of a film directed towards a political end as section 2(b)(vi) relates to Government policies or issues of public controversy in Singapore.

Can the Minister speak to whether or not further guidelines will be provided, perhaps in a code or subsidiary legislation, as to what bias and partisan means? This will help whittle down subjectivity in the exercise of discretion in this matter. Perhaps some guidance can be drawn from the list of films exempted from treatment as a party political film.

The list of exceptions to the category of party political film in clause 3 is extended to include five more types of films. As I was reading the expanded section 2(3) listing, my first thought was that if there was a film about the Films Act, it might be called: "No drama please, we are Singaporeans" or "the Importance of being Earnestly Serious?"

Films that record a lawful event, such as anniversary celebration videos by political parties fall within this exemption under section 2(3)(d), presumably because it is these serve as personal records. A political party may make a video in celebration of themselves, perhaps in hyberbolic terms, but this is

not meant for mass consumption and therefore will not pollute the well of public information meant to inform public debate.

Live recordings of lawful events such as processions under section 2(3)(c) or documentary films under section 2(3)(e) providing accurate accounts of actual events, persons or situations are exempted provided such event, person or situation is not depicted in a dramatic way. Under sections 2(3)(f) and (g), films which contain a political party or politician's manifesto made by or on behalf of the candidates are also exempted provided they contain no animation and are shorn of dramatic elements. These are open-ended terms!

The assessment of whether something is dramatically depicted will vary between "drama mamas" and those of a more phlegmatic bent. How do we measure drama? I appreciate that the intent is to regulate films which contain inaccuracies, convey false impressions or otherwise provoke irrational emotionalisms which precludes the finding of common ground which is so essential to the political enterprise. Could the Minister elaborate on how degrees of drama will be measured? Do we know it when we see it? For example, would a negative advertisement campaign against one's political opponent, subtly disguised or incorporated within the rational presentation of a political manifesto, qualify as an exemption?

Also, can he confirm that it falls to the Board of Film Censors to decide on whether a film is sufficiently undramatic so as to qualify as a section 2(3) exemption?

Sir, I note that section 35 which empowers the Minister to prohibit the possession or distribution of any film considered contrary to the public interest

still applies. This is a catch-all clause, wide enough to catch party political films which the Board of Film Censors considers has passed the test of being non-partisan and unbiased. It is a very broad power. Will further guidelines be provided to limit the Minister's discretion in this respect, to prevent section 35 from being a backdoor way to ban films which are found to escape the jaws of section 33?

The new section 4(a) empowers the Minister to appoint Advisory Committees to advise the Board of Film Censors. The Board may but is not required to consult with the Advisory Committee. Indeed, the Board can disregard the consultation. What then is the point of creating an Advisory Committee if its views may be so easily discounted? It seems a little unnecessary, perhaps even a waste of time. If the point is citizen participation, I can appreciate the value of that. However, to allay any fear that the Advisory Committee will be peopled by many a reputable personage who will merely rubber stamp the Board's decisions, there must be a way to demonstrate that consultation has in fact taken place and that this is a meaningful process.

Would the Minister consider adopting a rule requiring the gazetting of any disagreement between the Advisory Committee and Board and mandate that these bodies provide the basis for their reasoning? This will give the public a more transparent view of this kind of contestation taking place and promotes good governance.

Also, it appears that the existing Act and these amendments do not require the relevant decision makers, such as the Board of Film Censors and Committee of Appeal to give reasons for their decisions. Why not include a statutory duty to give reasons for their decisions, as a matter of good governance? This would also help

flesh out the contours of what is a permissible and non-permissible party political film.

Sir, we do not need a sledgehammer to crack a nut. More proportionate methods for restricting fundamental liberties are a good thing. I appreciate the prudence of a gradual, incremental approach towards section 33 and the move away from killing the message or chilling the messenger. Insofar as this Amendment marks a shift from absolute bans to a more calibrated form of regulating political speech where the Board acts as a kind of bouncer, I support the Bill.

Order. I propose to take the break now. I suspend the Sitting and will take the Chair again at 4.15 pm.

Sitting accordingly suspended

at 3.54 pm until 4.15 pm.

Sitting resumed at 4.15 pm

Debate resumed.

Mr Speaker Sir, this Bill is being introduced in the wake of the report by the Advisory Council on the Impact of New Media on Society (AIMS). AIMS made a total of 26 recommendations to the Government, including recommendations relating to sections 33 and 35 of the Films Act. In particular, AIMS recommended that section 33 be repealed in phases.

These recommendations pertaining to the Act were rejected by the Government. Instead, the Government announced some limited changes to the scope of section 33, while declining to amend Section 35 at all. This Bill introduces those limited changes to the scope of section 33.

Sir, my own view is that AIMS was fundamentally correct in recommending that section 33 be repealed. I am not sure if I agree with AIMS that the repeal should be conducted in phases, but that is now moot. Section 33 prohibits the making, distribution and exhibition of party political films. Section 2 adopts a broad definition of "party political film" that is overly-inclusive, that seeks to censor films based on their format and not on their substantive content, and this results in a potential chilling effect on film-makers. I remain unconvinced by the reasons for singling out film, when the printed word is equally capable of distortion and deception, when a well-written commentary can be even more powerful than a poorly-made film.

This prohibition on party political films is also easily and widely flouted in today’s Web 2.0 world, and maintaining such an unenforceable prohibition simply promotes disrespect for the rule of law, which is an unhealthy state of affairs with insidious, far-reaching repercussions. Finally, Singaporeans are today far more sophisticated and media-savvy than before, and should be trusted to judge the merits and demerits of films for themselves.

Be that as it may, the Government has made it clear that section 33 will not be repealed. Instead, this Bill seeks to make what seems like an incremental liberalisation, with an expanded list of films that are deemed not to be party political films.

However, even as the list seems to be expanded and longer, an important exception has been removed. The existing section 2(3)(a), which will be repealed, provides that films made by anyone solely for the purpose of reporting current affairs are not deemed to be party political films. This has been replaced by four specific, limited exceptions, namely, films made solely for the reporting of news by a

licensed broadcasting service; films recording "live" the whole or a material proportion of a lawful performance, assembly or procession that does not depict any event, person or situation in a dramatic way; films designed to provide a record of a lawful event or occasion, for its participants or persons connected with its participants; and documentary films without any animation and composed wholly of an accurate, non-dramatic account depicting actual events, persons or situations, which does not include unscripted or reality-type programmes.

To my mind, these four specific exceptions are narrower in scope than the existing section 2(3)(a). For instance, what is the justification for limiting the exception for the reporting of news, to licensed broadcasters only? This seems completely incongruent with the Senior Minister of State's recognition of the realities in today’s Web 2.0 world, and seems designed to inhibit the work of new media and citizen journalists and bloggers.

More importantly, these four specific exceptions do not seem to represent a true liberalisation of the position on party political films, and in fact could narrow the scope of what is permissible. In particular, the prohibitions on recordings of unlawful events and occasions seems odd. This was not an issue that was canvassed at any point during AIMS’ deliberations. The holding of an unlawful event is prohibited under other existing laws, and it is not clear why the creation of a video recording of such an unlawful event should be illegal.

It is also likely to create what can be called a nation of innocent criminals, eg, bystanders watching an assembly or procession may whip out their mobile phones to record videos of the event. They may not know whether the event

was being held in accordance with the law. If it was not, then they would be creating an illegal party political film. If they upload it to a website like YouTube, they would be distributing an illegal party political film. This is the precise problem that AIMS was constituted to address: laws that are out-of-sync with the times and that will invariably be ignored and flouted. So, why are we going out of our way to institute new legislation that we know will be disregarded and broken?

It is arguable that the exception regarding documentary films that accurately depict actual persons and events, including unlawful events, could apply to the situation that I have just described. Yet, the term "documentary film" is not defined, and its use suggests that this exception requires the film to be something more than a mere video recording, since the term "documentary film" must necessarily be something more limited in scope than a "film", which is the term used in the other exceptions. This exception is also problematic – documentary-makers will invariably have to edit their raw footage, but such editing could potentially remove them from the scope of this exception.

The new exceptions are also difficult from a lawyer’s perspective. Prof. Thio has very ably and cogently pointed out the difficulties with section 33 from a constitutional perspective. On a more technical level, these amendments introduce terms that are not defined, in a way that makes their application of uncertain scope. I have already mentioned the term "documentary film" in the new section 2(3)(e). Other new terms of ambiguous scope include "depiction in a dramatic way" as used in the new sub-sections (3)(c) and (3)(e)(ii), and "dramatic elements" as used in the new sub-sections (3)(f) and (3)(g). It would have been preferable to define what they mean, so that courts seeking to interpret these terms will have some guidance.

The final point I would make on this Bill, is that it does not amend section 35, as recommended by AIMS. Section 35 allows the Minister to ban any film that he considers to be "against the public interest", without giving any reason. AIMS had recommended that the permissible reasons for banning films under section 35 be spelt out clearly, that an independent advisory panel be formed to advise the Minister before a film is banned under Section 35, and that the Minister be obliged to give reasons for the ban. All three proposals have been rejected.

The status quo gives the Minister broad powers to ban films, while not making him accountable for any decision banning a film. This is wholly imbalanced and does not pay sufficient respect to Singaporeans’ constitutional right to freedom of speech. While we all accept that limitations on constitutional rights do exist, we should also accept that such limitations must be calibrated and limited, and also transparent and accountable. Most of all, they must be constitutional, and limiting the grounds upon which films can be banned under section 35 as proposed by AIMS would go a long way towards ensuring the constitutionality of this provision and its use by the Minister.

True, in the only known instance of a ban under section 35, the Minister did give his reasons for doing so. But giving reasons is at the discretion of the Minister. My view is that since this is a limitation on a constitutional right, the proper position is to require the Minister to justify any ban under section 35, with an exception where the very disclosure of the justification could prejudice national security, in which case the Minister has to explicitly state that and give reasons where practicable.

Sir, I would normally welcome any liberalisation on matters of free speech.

But these amendments to the Films Act do not seem to represent a material or true liberalisation of the current position, and they are also potentially problematic in their phrasing. The objective in constituting AIMS was to review existing legislation in the face of advances in digital technology and to suggest necessary updates to the law. As I have said, it is not healthy to have laws on the books that are consistently and openly broken by Singaporeans. This is the reality with the existing regime under the Films Act. My belief is that it will also be the case with these present amendments, in which case, why bother?

The Senior Minister of State has pointed out that the prohibition on party political films has an offline aspect as well, and that is true. But implicit in that is the acceptance that the amended prohibition on party political films will continue to be ignored online, and an admission that enforcement will continue to be absent in the online environment. But this is then an unjustifiable and unfair discriminatory practice against the offline population, in a sense that the prohibition is applied against them but not to the online citizens.

Because of this, I cannot support this Bill. It is bad law, it would not fix the problems that need to be fixed, and I cannot in good conscience support such a piece of legislation.

Sir, with that, I oppose this Bill.

Sir, it has been 10 years since the Films Act was amended to ban political films. The 1998 amendment, carrying heavy penalties, was termed by some MPs then as harsh, vague and detrimental to our goal of becoming a First World country. Late last year, the Advisory Council on the Impact of New Media on Society (AIMS) recommended that we should

work towards eventual repeal of section 33 of the Films Act altogether. As an interim measure, it recommended that step one be, to prohibit only those political films which were intentionally misleading.

To be fair, I feel the Bill has some merits, but is still far from what the AIMS Committee had proposed. The current amendment will still leave many film-makers, civic-minded citizens and political parties confused and bewildered over the many limitations imposed on permissible political films. The Bill suggests that the Government is still somewhat paranoid when it comes to opening up the political landscape. For instance, in the amendment to section 2(2)(a) and (b), the issue on whether a political film is biased or partisan is now clearly dependent only on the opinion of the Board of Film Censors. By contrast, the AIMS committee had recommended that the Board should not exercise the function which should be passed to a group of independent adjudicators comprising of citizens of high standing with public respect. Instead, the new section 4A allows the Government to appoint 'Advisory Committees' (the PFCC) to advise the Board on such matters; however, the section makes it clear that the Board can override the views of the PFCC. Sir, to begin with, most films, political or not, carry the values of the maker or author, which may not be shared by others. Miss Tan Pin Pin, an award winning director, wrote on behalf of 10 other film-makers to the Straits Times in 2005, questioning what constitutes 'bias' in making political films. She said, "all works of art are the expression of the artiste’s opinion, which may favour a

particular viewpoint or argument over another".

This means that the ambit of what is permissible will be ambiguous and uncertain. If we are sincere about promoting diversity of opinion, why have the restriction? There is no need to treat Singaporeans like children. They can assess for themselves whether the views or messages in a film are reasonable or not. However, if the ban on biased and partisan films remains, film-makers and the public should have a clear understanding of how the Board and Advisory Committee evaluate films. To add transparency to this assessment process, can it be mandated that for each film that is banned, the opinions of both the Advisory Committee and the Board be made public? Clause 2(c) expands the list of permissible films, which is a small step forward. However, the unnecessary limitation placed on some of these films is a giant step backwards for political engagement, artistic freedom and active citizenry.

For instance, the proposed sub-section 3(c) of the Films Act allows only the recording of events that are held in accordance with the law. Therefore, any unrelated bystander caught filming a protest on a cellphone could be prosecuted. To me, this does not make sense. Citizen journalism is a useful counterpoint to the official mass media. Singaporeans should be informed of what is going on within our borders, whether legal or not. The Government has stated that it wants to engage the online community seriously. If that is so, it must allow the recording of events, whether held in accordance with the law or not, because such events are essential to the growth of the blogging community and independent news portals. Furthermore,

these are mostly recordings of events that the mainstream media is not interested to cover.

Next, the ban on the use of animation and dramatic elements is another strange restriction imposed on political films that should be discarded. First, animation aids story-telling. Secondly, dramatisation is the essence of story-telling for any serious and creative film-maker.

It is somewhat ironic that the theme of the 2007/08 Media Development Authority’s Annual Report was "The Digital Way Forward: An Animation Special". The MDA Report identified animation as a key growth area for development. So, what kind of catastrophic harm can a promising technology inflict on the public when applied to a political film?

Is animated text permissible? Are special effects allowed? If nothing can be animated in a political production, why call it a film?

Besides, how can we celebrate the use of dramatisation in some films and at the same time censure the use of it in others? If the Government is worried about viewers being carried away, the Government can simply require all films to carry a mandatory disclaimer urging viewers of political films or documentaries to draw their own conclusions. I urge the Senior Minister of State to seriously consider removing this incomprehensible restriction on the use of animation and dramatic elements on political films completely. Sir, the 1998 Amendment fixed the penalty for those who make or exhibit political films at a maximum of $100,000 fine or two years' jail or both. This is indeed a very heavy penalty. With the easing of the ban on political films, and the uncertain boundaries mentioned,

should the penalties for political films not be lowered as well? Earlier in the second reading speech, the Senior Minister of State mentioned that the Election Advertising Regulations would be amended. He also mentioned that there would be no blackout period on new films during the election campaign, ie, political activists and parties can produce new films during the election period. I would like to seek a clarification from him on this, in the sense that during the campaign period, the timelines are usually very urgent and would there be a mechanism such that the requirement for submission to the PFCC before approval would be waived during the election period? Otherwise the delay caused there might render the films, in a sense, ineffective.

Sir, a final point to note. We have allowed controversial political films like Fahrenheit 911 to air here. Members may recall that that film was made by American Michael Moore, heavily critical of the then President George W Bush and the 2003 invasion of Iraq. By allowing the film in cinemas here, can we then infer that the Government will allow something similar with local content to be produced and aired here as well? If not, is the Government saying that it is all right to laugh at other leaders in the world but not at our own? In my view, the ability to take criticism and laugh at one self is a sign of a society's maturity and magnanimity and I urge the Government to adopt such qualities and accept films as nothing more than an expression of diverse opinion in a healthy democracy.

Finally, Sir, Singapore has a high literacy rate and high Internet connectivity. Singaporeans have many channels to obtain and verify official and unofficial information. There are also many laws in place such as the defamation laws, Penal Code and Sedition Act to catch content

which is objectionable. Our society should be ready for and work towards the removal of the ban on political films altogether, in other words repealing section 33 of the Act.

Sir, I welcome the liberalisation of the Films Act. This marks a nuanced shift by this Government in relation to film censorship. It is a recognition of the need to adjust to the changing media landscape and the people’s desire for more political space.

Sir, it is important to have a sense of history and media trends to understand the significance of this shift. Film censorship did not start in 1980 with the Films Act as some Members of this House seem to think. Film censorship, indeed, had existed during the British colonial days and it had always been stricter than that of publications for the simple reason that film, being audio-visual, had a greater impact and reached more people, compared to publications.

Publications at that time reached out to only the literate and better-educated people which formed a far smaller group than the film-goers. In 1959, when the PAP came into power, the literacy rate was only about 50%.

Before TV was introduced in Singapore in 1963, films were screened in cinemas and outdoor theatres. Until 1963, film censorship was under the purview of the Ministry of Home Affairs, which was at the time focused on containing the Communists and their propaganda. Film censorship was transferred to the Culture Ministry with the advent of TV.

In those early years, among the political films which were banned were those which extolled Communism, and for good reason. Communism was on the march in the region, and the Malayan

Communist Party was a ruthless force to be reckoned with. While rational political debate was the PAP’s first weapon of choice, the same could not be said for the Communists, who believed in the violent overthrow of government.

Sir, over the years, as the political landscape changed and became more stable, film censorship has become more sophisticated and relaxed. Our population has also become better-educated. Our literacy rate is now 96 per cent. Almost everyone owns a television set, and many also have a DVD player. Indeed many have their own home theatres at home.

The greatest change in recent years, of course, is the pervasiveness of the Internet, which has radically changed the way political battles are fought the world over.

Despite these changes, however, two underlying premises regarding film and political debate remain unchanged.

The first is that, because the medium is audio-visual, it can evoke a visceral response in the audience. It follows that political films that intentionally distort the truth, that mislead the public and incite them to rise up in misguided anger should be kept out.

The second premise is that political debate in Singapore should be rational, responsible and reasoned as far as possible. Hence, sensational political films that appeal to the baser instincts of people and that confuse and trivialise political debate should be discouraged.

Sir, first, I would like to make clear that I agree with the broad principles. While we want to widen the political space in Singapore, it should be done in such a way that it reaps an overall benefit for our society and its political development, and not lead to its detriment.

This is not, as some critics might say, to preserve the PAP’s power, rather it is to preserve the rational political environment that we have painstakingly built up over the years in Singapore, and which has served Singapore well. And it is not about laughing at ourselves or, as Ms Sylvia Lim said, the ability to take criticism. It is about building up a certain political environment that has served Singapore well.

Thus, I fully support the move to amend the Films Act to allow for only certain types of party political films – that which are factual and objective, and do not dramatise or present a distorted picture of our political reality.

By allowing such fact-based films, even if their content may prove controversial, they can serve as a starting point for rational discussion and debate. I hope film-makers will use this opportunity and this liberalisation to make more films of this nature that will promote reasoned political debate and add insight.

With greater activity and focus on such films, it will, hopefully, also marginalise the kind of sensational and outrageous political videos that we now find on the Internet which is why I now support this amendment. In response to what some Members say – that it is no sense having this Films Act because it can be circumvented on the Internet – my argument is that it is an important signal and it will, hopefully, serve to marginalise the kind of videos that we now see on the Internet.

A look at some Singapore political videos on the Internet show that a rational political environment is not dominant. The content of the political videos is designed to appeal to people’s volatile emotions rather than their reason. They distort with visual innuendoes. They oversimplify with no regard to context.

One such video on the Internet, for example, showed an opposition politician preaching civic disobedience and using his young innocent children to win public sympathy for his campaign. It is highly emotive.

Such political films find refuge in the Internet and their makers enjoy a certain underground notoriety that wins them a following. They feed on the conspiracy that this Government stifles dissent and runs a police state.

They spin the story that there are plots in Government to go after them, that its leaders indulge in duplicity and intrigue, that all power is traced to a few absolutely evil and omnipotent men.

They juxtapose one set of facts with another and say they must be related. All these innuendoes in all their complexities appear highly mysterious to the general public.

The paranoid mentality, however, is one that does not listen to logic. Its reasoning requires several, sometimes wild, leaps into the imagination. Yet the film-maker is dexterous enough to keep the storyline on such a level as to make it all seem true and logical.

Which leads to a basic question: Why are such political videos and films made, although they are presently illegal, and loaded up on the Internet? The answer seems fairly clear: Because they can. And also, on the Internet, an audience for such sensational political entertainment exists.

My view is that such political films based on distortion of facts make no contribution to enhancing the conditions of this country’s political reality. Instead, they coarsen and lower the standards of political discourse.

Sir, this amendment to the Films Act is a relaxation, but listening to the

arguments of some Members of the House, the concern seems to be it is, in fact, not a relaxation but a clamping down. I ask assurance from the Senior Minister of State that this is not so.

In fact, I would argue that the steps taken in this amendment in fact are quite bold and I have seen many films including from Miss Tan Pin Pin, the film maker named by Ms Sylvia Lim, and many of them take issue with Government policies, even entertaining films like Jack Neo's "Money Not Enough No. 2", which used animation to put out ERP gantries which are thrown by a mob into the sea are shown without any great fuss by the official circles.

So the Government is already ruling with a light touch. And I am quite sure that the intent of this law is to liberalise further and not to further make it more difficult for film makers to express themselves but in ways that will add insight, that will add to a reasoned debate and not mislead and distort the truth.

Sir, I would like to ask the Senior Minister of State for an assurance that the independence of the new advisory panel. In assessing films, it should be transparent and fair, and seen to be so.

Its decisions should be made public and explained. Opportunities should also be given to the film-maker to re-edit the film, based on the committee’s comments, and resubmit it for approval. Otherwise, it will merely stir the unhealthy imagination of those who feed on conspiracy.

I hear Prof. Thio Li-ann and Mr Siew Kum Hong talk in terms of freedom of speech. I think that is a worthy topic but I would urge the Members to, perhaps, move a separate motion on freedom of speech and deal with it holistically to do with publications, films and all other

media, and not use that argument for the Films Act which is one aspect of freedom of speech.

And I think it is, in a way, confusing the debate to bring in what you call "a constitutional right" to freedom of speech. All of us value the freedom of speech. The question is: What serves society? And it is up to this society to decide what limits we place, what we think is valuable. I think it merits a deeper and wider debate.

Sir, on the panel, it is important to ensure that the committee consists of non-partisan people of standing, especially established historians who understand that history can sometimes be interpreted in various ways.

It is not unusual for documentaries, for example, to take different historical perspectives and even challenge the prevailing one. The important thing is that they are based on rigorous research and facts.

Sir, I note that the Chairman for the new committee is the retired Senior District Judge Richard Magnus. Can I ask the Senior Minister of State how the Government decided on this particular retired judge for this role? Not that I doubt its judgment but I think it is good for the public to know on what basis does the Government decide that this person is non-partisan and an independent person to chair this important panel.

Besides being even-handed, the panel should be expeditious in its decisions in processing a film. This will prevent it from being accused of holding up a film unnecessarily, or of applying double standards. Is there an estimated time frame for party political films to go through the process? And how will the panel work during an election campaign, given the timeframe?

Sir, it is important to make sure that the panel can, itself, withstand the test of public scrutiny in its application of the amended law. This is after all a liberalisation, and should be seen as such.

Mr Speaker, I believe the amendments to the Films Act are timely, to widen the usage of films for political purposes, and loosening the regulations to keep pace with times.

We can understand why there was a need to be cautious as far as films are concerned. This is a medium that can easily sway the emotions of people. However, the proliferation of the new media and the ease to get films produced and distributed outside of Singapore also signals that local regulations are becoming less and less effective.

Singaporeans, especially the younger generation, are getting used to having access to a variety of films and media content – within and beyond our shores. Thus, we need to keep in step with these developments. Therefore, these proposed changes are a good first step in recognising this trend, and that the Government is willing to listen, respond and manage the variety of alternative views and messaging from the media.

I think this will benefit our political landscape in Singapore. I believe the deregulation of this space will be beneficial not just to the opposition and neutral groups, but also for the ruling party to keep in step and further its causes in the arena.

I hope for the Government to relax the regulations beyond the non-dramatised film documentaries as well as footage from legal events. I think that films are a good way to get people to understand and appreciate political affairs from different perspectives. Stifling such creative works will limit the outreach for political discussion and thought provocation.

Today, many international movies portray political figures whose actions in histories are interpreted in different ways that enable viewers to reflect on moral issues, values and societal concerns in relation to politics.

While the Government always cites movies in the likes of Farenheit 9/11 that we must be wary of, where would films like Nixon/Frost, JFK – highly-acclaimed, political themed, commercial films – be if not for a film-maker's interpretation of events around political figures and provoking the thoughts of the people? Through this medium, we can also tell our Singapore story and our political struggles of individuals and political parties for our young and future generations to reflect on.

There are certainly merits for the Government to further loosen this Act because such films are also important to a nation's heritage. Over time, it helps keep citizens engaged on Singapore's past and history, which sometimes documentaries are not able to do as there is always a human element to the story. So my concern is: to what extent can we allow space for film-makers and give them the creative licence for them to produce such films?

Clearly, we can see that the authorities still maintain a conservative stand with regard to two categories: (i) party political films; and (ii) films deemed to be against the public interest. The Government may have its own reasons for this, but it still has grey areas that are not helpful to anyone trying to make political videos. I think what many are asking for is greater clarity on the OB markers.

On the issue of OB markers, my concern lies with the PFCC. This panel does not just deal with content with respect to public interest but there is political sensitivity involved. I think questions will also arise on who sets the

rules on the selection on what films are accepted and what are not, and what are the definitions of the political OB markers, if any.

There can be many interpretations as mentioned by my other esteemed colleagues on the technical issue of dramatisation and the interpretation of events. The definition of dramatic elements is not clear and may turn out to be a technical no-go for films being produced for political purposes.

In relation to the PFCC, I agree with Ms Irene Ng that they must remain independent and that the decisions must be made transparent. I think the selection of the panelists will also be crucial to the acceptance of the PFCC's role and judgment in this process. I fear scepticism in this de-regulation process if the Chairman and members of the PFCC are seen to be pro-establishment or have come from the Government in their previous roles. I also fear conservatism by the panel given that this is the first time we are relaxing the laws in this manner and the danger of their objectivity being hijacked by lobbyists.

Pertaining to the use of films for elections purposes, I think that this will create a more vibrant run-up to the elections campaign. The changes effectively remove handcuffs from real political parties – like the PAP – with an interest to engage citizens through films and Internet. It is also important for parties, such as the PAP, to set the tone for its legal use and play by the rules. As a PAP MP, I think that we have always been hampered in this space as a result, compared to the many instances of politically-motivated groups circumventing the existing rules through the online media.

Sir, I still think that there are two areas where we can relax further. In

section 33, the Government still continues to criminalise the making of party political films in general. This may be perceived to be a backdoor for the Government to take action against errant producers of such films. What are the safeguards for producers who fail to make the grade through the PFCC from being charged for making such films? They are technically still guilty of making a party political film that is not within the legal framework.

Under section 35 of the Films Act, a film can be considered to be against the public interest and the film can still be banned. It has only been invoked once since it was enacted and we have the Sedition Act and the Penal Code to deal with any material against public interest. Is this section still relevant, given the other safeguards in place?

In relation to section 35, should we reconsider if a Minister should hold the power to ban party political films, as he is also a political figure from a political party? From a politically neutral point of view, should the Government consider letting the judiciary arm, or an independent panel hold this authority?

Given the times, the Government needs to evolve and be able to accept a diversity of films and opinions. That is the key to show that Singapore has matured and that we are ready to go head-on to show that our Government is honest and transparent. I think the amendment is taking us in the right direction. The Government must continue to step up to engage, articulate and explain its policies and action to the people so that it can better accept alternative points of view or interpretation of history and current affairs.

We must have more faith in our society to be able to distinguish acceptable political ideologies. Singaporeans are now better educated and more matured. We need to continually

engage them and allow them to weigh different arguments and reach their own conclusions. This means having a Government that is comfortable in addressing misinformation and alternative perspectives, and allowing Singaporeans to decide for themselves.

It may well be, at the end of the day, a case such as the relaxation of demonstration rules at the Hong Lim Park. In the past, we had loud calls from various corners of the local and international interest groups for us to relax the regulations. The Government relaxed the rules, and things are still peaceful today with very little interest in what goes on.

With that, Sir, I support the Bill.

Mr Speaker, Sir, first of all, let me thank all the speakers who have spoken on the amendments to the Bill. The majority of them have expressed their support to the amendments that have been tabled. Some have done so with strong support and some are quietly applauding the amendments that we have made but they have all raised interesting perspectives and questions. Let me try and package them together and address some of them. I will do so along three limbs.

First, the intent of the Bill, if I may borrow the structure from Miss Penny Low who spoke first. Second, the content of the Bill and, third, the process. I actually dwelt on the intent at some length in the Second Reading speech and so I hope to be brief on this particular aspect.

For the contents of the Bill – to explain a little more on sections 33 and 35, although that is not part of the amendments, as well as address some of the points that have been raised: being partisan, biased, animation, dramatisation and the use of some of these words.

Third is to try and explain more clearly what the process is with regard to the submission of a film to the Board of Film Censors (BFC) and how this will be subsequently treated with the formation, if the Bill is passed, of the Political Films Consultative Committee (PFCC). And, although Members have not brought this point up, the final appeal authority which is the Films Appeal Committee (FAC), and their decision being final on whether the film is a party political film.

Let me deal with the intent.

Members, by and large, have recognised that while the films will be a useful medium to communicate messages to reach out to the young and a particular segment of the society, there are also downsides to the film that it can mislead and distort, and there are certain emotive appeals that the film can make which could be damaging. My take on this is that if our democracy is reduced to slick commercials, clever editing, sharp sound bites and political spin, then I think our democracy is being debased. So I would say that when we crafted this, we were very much aware of the need to make sure that even as we liberalise – here, I want to give the assurance to the point that was raised by Ms Irene Ng that indeed this is meant as a liberalisation of the space that we have today with regard to the use of films – that we continue to want to make sure that the debate is serious, robust and rational.

The second point is that I think films have a mass appeal that books and texts do not have. When we are watching a film together has a different appeal then if we watch it on television or over the Internet. And even if an individual watching films over the Internet gets worked up and very emotional, it is one person on his or her own, whereas a group of people coming together watching a film that has an emotive appeal coupled

with commentary and incendiary remarks, the damage can be potentially catastrophic. So, what we are doing here, as far as the intent of the Bill goes, is to take a careful, calculated, calibrated approach to liberalising to include more categories under the segments that will be exempted from being party political films. This, I have said earlier in the Second Reading that we will make further changes when it is appropriate to do so.

Prof. Thio Li-ann had also queried about the Bill vis-a-vis Article 14(2) of the Constitution and I know that Ms Irene Ng had suggested to her and others to table a proper motion to debate this. I am not a constitutional expert but my take on this is that I am fairly sure that this must have been deliberated quite extensively by our predecessors when the Bill was first moved in 1998. But, again, back to the fundamentals and principles which are to keep our political debates rational, non-emotive and serious to preserve the integrity of the election process, I think disallowing certain types of films does not affect the overall freedom of political debate in Singapore. My take is that there are sufficient avenues for political parties and individuals to get their views and manifestos across to the public. They can rely on the mainstream media. They can publish magazines, print newspapers if they are licensed to do so, host web pages online as well as debate about such issues in Parliament.

4.56 pm

Let me move on now to talk a little bit about the content of the Bill. Let me say, first of all, that in coming up with such amendments and what we proposed to do, we have got to strike a balance between the prescriptive and the

descriptive. We cannot be overly prescriptive, trying to tighten every loophole, trying to spell out to the nth degree what is permissible and what is not because it is not possible to do so. And certainly, in addition to the many examples that have been given, I am sure the creative film makers will also be able to find other ways to circumvent what we prescribe. What we try to do in the Bill is to set out certain parameters that I think would quite clearly indicate what is acceptable and what is not. But beyond being descriptive, we must also describe the intent of the Bill – what we hope that it will do, what we want it to achieve, what kind of guidance this will give to the people who eventually have to exercise judgment on whether a film is a party political film (PPF). So we are trying to strike a balance in the amendments as well as in this debate, together with the Second Reading speech, between being prescriptive and being descriptive. My second point is that I think it is worthwhile for films to be viewed in context and in totality: dramatisation and animation, is it partisan? Is it biased? Rather than picking out specific aspects of it and querying over certain segments of the film alone, I think it is important for those who are viewing such films to do so in the right context and in its totality.

My third point is that at the end of the day, notwithstanding some comments that have been made about this being an art and not a science, there is always going to be an element of subjectivity in assessing whether such films are PPFs or not. And we have to trust the process and the people selected to help us bring that process forward and I shall touch on this later.

Let me deal with some of the words that have been used, "being partisan", "biased", "animation" and "dramatisation". Let me assure the House that simply having actors to portray a certain role will not cause a film to fall out of the amendments that are permitted. Limbs

which allow for "live" recordings and documentary as long as the film does not sensationalise. For example, if you want to have a documentary on somebody who has passed on and he had been a political figure prominent in the political scene in Singapore, we will need an actor to re-enact important episodes in his life but, again, the intent is not to allow distortion so the dramatisation is permitted. But the distortion, if it takes place, will be what the BFC, PFCC and FAC will be most concerned about. Some degree of animation is also something that we will have to look at because if in a party manifesto, we are describing the future of Singapore, we have got to be able to depict it in a way that people can understand, visualise and be excited over. We have done so for the National Art Gallery. It came to mind, as I was listening to the Members, that part of it had to depict what was not yet in place, how we are going to transform those few things into something that, hopefully, will captivate the attention of Singaporeans and visitors alike.

And I dare say that some animation is going to be permissible in bringing forward the message of how we intend Singapore to be, going forward. But, again, the extent of the animation – does it distort, does it mislead – will be something that the BFC and the PFCC will have to exercise judgment.

Let me touch on sections 33 and 35 because I think many Members have spoken out and raised issues regarding these two particular areas. Prof. Thio Li-ann, Mr Zaqy Mohamad, Mr Siew Kum Hong, Ms Sylvia Lim, amongst others, spoke on section 33, why are we not decriminalising the making of party political film as recommended by AIMS. Our position is that the Government is only disallowing what would be dramatised, sensationalised and emotive party political films which will do harm to rational and objective political debate. And so we feel that there is strong reason to maintain the sanction against the making of such films. But bear in mind

also that while we retain this clause, and we have always had this clause since the inception of the Bill, we have not prosecuted anyone for the making of a PPF to date. That is an important point, that while it is retained, it is there and has been there over the last 10 years, there has been no move to prosecute anybody. So moving forward, whether or not a film-maker will be prosecuted for the making of a PPF, it is not an automatic process but it will have to depend on the facts and the significance and the merits of each case.

Section 35: Again, same Members have raised their issues and comments on section 35. Let me clarify a misconception that this is a so-called backdoor way to catch the rest of the films that would otherwise have passed, because section 35 is not against PPFs; it is not to be used against party political films. PPFs, unless they fall under the exceptions, will already be banned from the onset and there is no need to apply section 35 to such films. Section 35 is meant and reserved for serious situations where due to the circumstances of the day, the possession or distribution of the film would actually be contrary to public interest - presenting a threat to national security, danger to racial or religious harmony, and perhaps affecting even the very fabric of our multi-racial, multi-cultural society. Members have noted that so far, we have only used section 35 once and that was on "Zahari's 17 Years", and the Minister had come up with a press statement to fully explain why he issued the ban. We did not want to impose on the Minister the need to make such a press statement or to have to explain every time he exercises the jurisdiction to impose such a ban. But, where possible, he will indeed do so. But for those who have forgotten what "Zahari's 17 Years " was all about, the film was a revisionist attempt to have a distorted and misleading portrayal of Zahari's arrest and detention. It was an attempt to exculpate himself from his

involvement in communist activities against the interest of Singapore. He had posed a security threat for which he was detained under the ISA, and he now wanted to exploit the use of film to project false and distorted picture of his past actions, and that is why the ban was made. It was not a political film.

There were also comments as to whether this signals any change with regard to the way we view the Internet. Let me explain our position with regard to films on the Internet. First of all, the Films Act governs both offline and online films. But the Government had decided to adopt a three-pronged approach towards regulating the Internet. First, we say we will take a light-touch approach via the class licence scheme. Second, that we will couple this with public education and, indeed, we followed up on one of the AIMS' recommendations to have inter-Ministry cyber-wellness taskforce. Because we recognise that public education really would lay the foundation for further moves to expand the political space in this area, and to make sure that people exercise the right degree of discernment, judgment, to view things not in isolation but to be able to see things in totality, to recognise the larger picture and not to be misled by seductive arguments narrowly focused on a particular area. And the third limb, besides light touch and public education, was industry's self-regulation and co-regulation. And, basically, we will not deviate from this, going forward. Films that are available on the Internet will have to continue to abide by the class licence scheme as in the past.

So enough on the intent and the content of the Bill. Let me move on to talk a little bit more about the process because I think there were some queries and concerns. Let me say, first of all, that today the Board of Film Censors

decides. The BFC takes a look at the film and if it deems it to be a party political film, it decides and it rejects the classification and prohibits it from being exhibited. That is for political films. For the rest of the films, it will decide those that are clear-cut – and about 90% of the films that it receives are largely clear-cut in nature. The remaining 10% will be sent to the Films Consultative Panel for their views and their input.

The BFC received about 750 films and about 16,000 videos in 2008. Eighty per cent of the films were classified within seven days. Ten percent of the films, again, more contentious, they sent it to the FCP for the views of members and for their input and assessments to be made, and they completed the process within the space of about one month. So, that is the time taken. For videos, because of the load generated by 16,000 videos, it took longer. About 40% of the videos were classified within two weeks. The rest took longer and those that have to be sent to the FCP came back within about two months.

Let me move on before I come to the FAC later. What will change now is that with the formation of the PFCC, if the Bill is passed, films that the BFC deems to be political in nature, instead of rejecting it, it will now send it to PFCC. And PFCC, with its six to eight members plus the chairman, will then give their views and input, and this will come back to BFC before BFC makes the final decision. Composition of the PFCC has not yet been decided obviously, until the Bill is passed, but we have already announced that Mr Richard Magnus will be the Chair of the Committee. Ms Irene Ng asked why we selected Mr Richard Magnus, I think he is somebody we know well, retired Senior District Judge, has a distinguished career and established reputation, known for his impartiality. He will form the Committee, as I said, and the Committee will then be appointed by

the Minister for Information, Communications and the Arts. And this Committee, together with the BFC, will then make the decision on whether a film is a PPF.

What has shifted from our present position is that we are actually taking a more community-based consultative process. In the past, civil servants, BFC decides. Right now, we involve the PFCC comprising private sector individuals, as well as refer the films to the Films Appeal Committee (FAC) should there be an appeal by an aggrieved owner of the film. The FAC has, over the course of the last five years or so, listened to 10 appeals from aggrieved owners who disagreed with the BFC's decisions. The FAC overturned the BFC's decision on six of those occasions and upheld the BFC's decision on four other occasions. And the BFC accepted the Films Appeal Committee's decision as final and went along with the FAC's final decision on the determination of the classification of the film. That was for commercial films; the same process will now be used for films that are deemed as PPFs.

So there is a certain confidence, I hope, to give to Members that, firstly, the composition of the PFCC, a new entity, will comprise people who are non-partisan, who are serious-minded, who will exercise sound independent judgment. The BFC will take their views into consideration but cannot always abide by their views, just as the BFC cannot abide solely by the views of the PFCC, and let me explain why. Today, the FCP has about 65 members. We seek their views, not everybody responds, but for those members who respond, we consider all their views. Where the views are clearly in one direction, it is quite easy for BFC to make a certain decision. Where it is more finely balanced, the BFC will then have to take into consideration the individual views that are expressed and come to a conclusion, and make its decision accordingly. We do not yet know how the

process with the PFCC will work out because it has not quite been formed yet, nor do we know how long it will take, a point, I think, that was raised also by Ms Sylvia Lim. We will know better but we know that the formation of a separate PFCC will actually smoothen the process because, otherwise, all films will join the same queue and be submitted to the FCP for consideration, together with the rest of the commercial films and videos. So this will be an opportunity to try and move what are deemed party political films, to be considered more quickly by a panel that is independent and for their views to be made known. Ultimately, as I have said earlier, there will be a certain degree of judgment, always an element of subjectivity in their decision-making, and they will have to apply and interpret the parameters that have been spelt out in this Bill.

There were also queries on whether the BFC or the PFCC should make their views and positions public. I think what will happen is that owners who submit the film to the BFC will have a chance to interact with the BFC should the conclusion and the decision be not in their interest and be adverse to what they would otherwise expect. And if they then edit the film and take into consideration the comments given by BFC, then the film can be submitted afresh to the BFC for reconsideration. Otherwise, if they are unhappy and aggrieved by the decision of the BFC, as I said earlier, there is always the opportunity to bring their case to the FAC and FAC will hear it independently.

I have basically dealt with some of the main queries that were raised by Members. Let me say categorically that the amendments that this Bill proposes bring about what I believe to be significant liberalisation and change, and it will widen the space for political discourse and engagement, particularly through the medium of film and videos and, I hope, over time, to enable a more robust and

vibrant political environment. But at the same time, I think we must be mindful and indeed careful to maintain the integrity of our electoral process and continue to keep our political discourse serious, rational and robust. We are fully aware that technological and societal landscape will change and continue to evolve. We are committed to ensuring that our rules will remain relevant and that they keep pace with time. We will make further changes when it is appropriate to do so.

Question put, and agreed to.

Bill accordingly read a Second time.

Mr Deputy Speaker, Sir, I request for my "No" vote to be recorded as such.

The Assistant Clerk will record Mr Siew's vote.

Bill committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. – [RAdm Lui Tuck Yew].

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

Mr Deputy Speaker, Sir, I request for my "No" vote to be recorded as such.

The Assistant Clerk will record Mr Siew's vote.

Order for Second Reading read.

5.17 pm

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

Rationale for key amendments

The Building and Construction Authority (Amendment) Bill introduces a licensing scheme for importers of essential construction materials. Through licensing, we seek to achieve two objectives, namely, to ensure that imported materials meet requisite quality standards, and to enhance the supply resilience of such materials to Singapore. Let me explain.

Currently, BCA administratively requires concreting sand and granite that are imported via its aggregate terminals to undergo certain quality tests. We will formalise the testing requirements as conditions under the licensing scheme. This will give BCA the proper legislative authority to impose these requirements on importers of essential construction materials. There will be no additional cost to the industry arising from formalising these requirements, since they are already imposed administratively.

Sir, the disruption to our concreting sand and granite supplies, arising from the Indonesian ban on sand exports in 2007, reminds us of the importance to ensure the resilience of our materials supply. Through the licensing scheme, BCA will work with the materials importers to develop robust business continuity plans to guard against unforeseen supply disruptions. We have consulted the industry stakeholders on the proposed licensing scheme, and their feedback has been incorporated into the Bill.

Sir, let me elaborate on the key amendments proposed.

New Part VIA on supply of essential construction materials

Clause 4 of the Bill will add a new Part VIA, to enable the implementation of a licensing scheme for importers of essential construction materials. For a start, the scheme will apply to the import of concreting sand and granite to be used for building work, street work or railway work in Singapore.

Existing importers will be given six months to apply for a licence. The licence will be valid for not more than 24 months and is renewable.

Quality tests

Licensees must also apply for an import permit for each consignment of materials. Test requirements to determine the chemical properties of imported materials, to ensure that they satisfy quality standards, will form part of the import permit conditions. The tests will have to be conducted by an authorised analyst designated by BCA, similar to the practice today.

Let me briefly explain what constitutes "quality" sand and granite. Both these materials contain a certain amount of silica. To be of acceptable quality, these materials must not contain more than a specified level of reactive silica. If a high level of reactive silica is present in sand and granite, this silica will interact with the alkali present in cement, causing an "alkali-silica reaction". This reaction, occurring over a period of time in the concrete, will cause the concrete to expand and form widespread cracks. Over time, the steel bars within the concrete would become susceptible to rust and corrode in our humid climate, causing structural weakness of buildings.

Business continuity plan

The importer will also need to furnish a business continuity plan to demonstrate

the ability to mitigate any supply disruption of materials. BCA will evaluate the plan and issue a licence to the importers after it has been endorsed. In view of the current economic conditions, we will allow a lead-time of at least 18 months for the industry to comply with this requirement.

Penalty for importing without a licence

The penalty for importing the stipulated construction materials without a valid licence is a fine not exceeding $500,000, or imprisonment not exceeding two years, or both. The severe penalty is necessary to serve as a strong deterrent, given that an unlicensed importer bringing in poor quality materials could endanger public safety.

Revocation of licence

For licensees who fail to comply with the licence conditions, the Bill will allow BCA to impose a range of actions including suspending the licence, and imposing a financial penalty or such other directions or restrictions on the licensee’s business as importer of such materials. The Bill also sets out the circumstances under which BCA can revoke an importer’s licence. The Bill will nonetheless provide the importer with recourse to appeal to the Minister before a licence is revoked.

Sir, we have also taken the opportunity to make other amendments to improve some of the existing provisions in the Act. I will highlight the more salient ones.

Amendments to sections 9 and 12(1)

Amendments will be made to section 9 to empower the Minister to assign new functions and duties to BCA by assignment in writing, in line with the

overall mandate given to BCA under the Act.

Section 12(1) will be revised to clarify BCA’s delegation powers. The revisions will make it clear that while BCA has the power to delegate its functions, duties or powers to its members, officers or committees of persons, BCA cannot delegate this "power of delegation" given to BCA under this section, nor can BCA delegate the power to make subsidiary legislation given under this Act or any other written law.

New sections 34A to 34E

To facilitate the enforcement of the new Part VIA, sections 34A to 34E have been inserted. They deal with various miscellaneous matters such as composition of offences and obstruction to officers enforcing the Act. For example, section 34B has a standard provision to deal with corporate offenders and the officers or managers of such offenders.

Mr Speaker, Sir, the Bill will enable a proper system to be put in place to ensure that imported construction materials meet the necessary quality standards, so that the structural integrity and safety of our buildings will not be compromised. It will also help to strengthen the resilience of our supply of essential construction materials. And it will formally authorise BCA to implement and enforce these important requirements.

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. – [Mr Mah Bow Tan].

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

>

Order for Second Reading read.

5.26 pm

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

This is the third time I am coming to the House to seek Members' support to amend the Human Organ Transplant Act (HOTA). I am grateful to Members for your strong support for the previous amendments. As a result, we have been able to save the lives of more patients with organ failure who would otherwise die prematurely or live in misery. Prior to the first round of amendments in 2004, there were, on average, 13 cadaveric kidney transplants in Singapore under HOTA each year. This is about one a month. Now, we are doing an average of 41 such transplants a year, more than three times as many. This is almost one every week. The two rounds of amendments have helped save many more lives.

I am now ready to seek Members' support for the third round of HOTA amendments. There remains a shortage of organs. Last year, 26 patients died while waiting for an organ; currently, more than 560 patients remain waiting. We must continue to try to raise both cadaveric as well as living donor transplant rates. And we intend to do this by making the following changes to the Act.

Proposed amendments

First, we propose to remove the upper age limit for cadaveric organ donation

under HOTA. This will increase the number of cadaveric donors.

Second, we propose to allow paired matching for the exchange of organs between living donor-recipient pairs. This will facilitate living donor transplants.

Third, we propose to remove the prohibition of payment to reimburse or defray the costs or expenses of living organ donors. This will better protect their welfare and ensure that they do not suffer from additional losses because of their altruistic acts.