Hansard, Monday, 17 August 2015

1 Mr Mohd Ismail Hussein asked the Deputy Prime Minister and Minister for Finance in light of the recent Auditor-General's Report for FY2014/2015 on lapses found in public sector entities (a) whether the respective Ministries have conducted their own investigations into the lapses; (b) whether these investigation reports will be made public; (c) how many of these lapses are repeat lapses; and (d) what are the measures the respective Ministries plan to take to tighten controls and avoid serious lapses that affect the proper use of public funds.

I thank Mr Mohd Ismail Hussein for his question. Before I get into the specifics, let me briefly explain that there are two types of audit conducted annually by the Auditor-General's Office (AGO).

The first type is a financial statement audit. AGO checks if the Government Financial Statements have been prepared in accordance with the law. The Government Financial Statements incorporate the accounts of all Ministries, Departments and Organs of State. AGO's audit hence covers the accounts of all these agencies.

The second type of audit is a selective audit. AGO checks on individual public agencies' compliance with rules and procedures and also on their internal controls. AGO does these selective audits on a selection of agencies every year.

For its audit of the Government Financial Statements, AGO has given an unmodified audit opinion this year, just as in previous years. That is to say, the Government Financial Statements, containing accounts of the Ministries, Departments and Organs of State, are reliable, and public funds are properly accounted for. The same is true for the Statutory Boards, all of which received an unmodified audit opinion from their respective auditors for the Financial Year (FY)2014/2015.

The findings reported in the Auditor-General's latest report for FY2014/2015 did not affect AGO's opinion of the Government Financial Statements. The findings, which are the result of the various selective audits performed by AGO, highlight lapses in complying with the rules and procedures which the Government imposes on itself to ensure proper conduct. Each of our agencies takes every lapse seriously and ensures improvements are made

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promptly.

I will now address the specific questions that Mr Mohd Ismail Hussein has raised. All of AGO's audit findings are looked into by the Heads of the respective agencies. In the case of Ministries, this is the Permanent Secretary. The Permanent Secretaries and the other Heads of the respective agencies are responsible for ensuring that the lapses are rectified and steps taken to minimise recurrence. This includes the need for further investigations within the agencies when required, and to take disciplinary actions where warranted. Any suspicion of corruption or fraud is referred promptly to the Police and investigated thoroughly.

With regard to Statutory Boards, their audit findings and any further investigations are also reviewed by their respective supervising Ministries.

In this year's report, AGO has observed lapses in some agencies regarding their administration of grants, management of procurement or revenue contracts, management of contract variations and related-party transactions. All the agencies involved have conducted their own investigations into the lapses. Except for one audit finding concerning an agency's procurement of event management services, all the other audit findings in this year's AGO report were not repeat lapses.

All agencies where lapses were found have taken steps to improve. Depending on the problem, this includes closer monitoring by supervisors and internal auditors, improved and clearer internal guidelines for officers, enhanced IT systems to enable better tracking, and developing fund administration guidelines for management of programme vendors.

Further, officers responsible for the lapses are taken to task. Because of the consistent way we have dealt with lapses in the past, all public officers and their supervisors know that if they are responsible for any misdoing, firm measures including disciplinary actions, will be taken whenever necessary. All officers know that. If there is any misdoing, firm measures will be taken, including disciplinary actions wherever necessary.

Except for one case in the latest AGO findings which has been referred to the Police for further investigation, all the other cases were due to administrative or procedural lapses. These were mainly due to a lack of knowledge, carelessness or poor supervision. But even where there is no evidence of fraud or corrupt intent, an officer may face serious disciplinary action, such as having his salary increment withheld and being debarred from promotion for a few years. And this, indeed, does happen.

Mr Mohd Ismail has also asked if Ministries' investigation reports will be made public. The Public Accounts Committee, comprising Members of this House, can and has called up

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public agencies to give a full account for areas which are of concern to the Committee. Agencies are required to submit all materials related to their cases, including investigation reports, to the Committee if asked. The Committee then gives its opinions and observations, including its assessment of the agencies' follow-up actions, to Parliament and to the public.

To go beyond this and make public each agency's investigations into every lapse each year will not help in ensuring the thorough internal investigations needed to get to the bottom of things. What matters is that agencies take each and every lapse seriously and take steps to minimise recurrence.

To conclude, let me reassure Members that we have a sound system of checks and balances in place in the public sector, which is why it is regarded as one of the cleanest and most reputable administrations in the world. Public officers and agencies know they have a responsibility to safeguard the use of public funds. Internal controls are in place within each agency, audits by an impartial AGO are carried out regularly and rigorously, and the AGO's findings are made public. The agencies take prompt action whenever problems are found and make no attempt to cover them up. And where there is any suspicion of fraud or corruption, investigations are thorough and errant officers face the full measure of the law regardless of their seniority.

Any AGO audit must be expected to turn up some lapses and oversights. If nothing was found, I would be concerned about the independence and rigour of AGO's audits.

We take every lapse seriously and ensure prompt remedy. But we cannot tighten controls to the point of eliminating all lapses. It is not possible to avoid human lapses completely in any large organisation and we would also be weighing down the system with more rules than is sensible for an effective administration. It would freeze decision-making within our agencies. We must, therefore, continue to maintain a sensible balance of rules, subject ourselves to regular and thorough audit, and take full and proper actions whenever problems are found.

Finally, I should emphasise once again that AGO's findings on compliance with rules and procedures do not impinge on its assessment that the Government's financial accounts are reliable. They leave no doubt as to whether the public's money is fully accounted for and in safe hands.

Mr Liang Eng Hwa.

Timah): Mdm Speaker, in his reply, Deputy Prime Minister Tharman mentioned about the different types of audit conducted by AGO. I would

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like to ask the Deputy Prime Minister if he could help us better understand the different types of audit that AGO conducts. For example, those that AGO conducts on the various Ministries and agencies on an annual basis, versus those that AGO conducted on the Aljunied-Hougang-Punggol East Town Council (AHPETC), and what are the differences?

On the first part of Mr Liang Eng Hwa's question, as I have explained, there are two types of audit. One is an audit of the reliability of the financial statements; the other is a selective audit that AGO does each year on different agencies on quite a wide range of issues, mainly to do with their compliance with the rules and procedures that we have put in place to ensure proper conduct. But it goes beyond that also. It looks at wasteful spending, whether there is value-for-money in spending, and a range of other issues. So, AGO has the remit to decide on what is relevant in its selective audits and it has ranged quite widely across our agencies.

The fundamental issue which I highlighted in my answer is that AGO has given an unmodified opinion on the Government's financial statements. That is, indeed, the fundamental difference between the AGO's opinion on the Government, compared to the AGO's opinion after its special audit of AHPETC.

The problems in AHPETC are fundamentally different. The entire system of accounts is a problem. If I can quote from the AGO Report on AHPETC, "There can be no assurance that AHPETC's accounts are accurate and reliable, or that public funds are properly spent, accounted for and managed". This is not just a matter of poor accounting procedures. It arose because there were so many weaknesses and omissions in the AHPETC accounts that its own auditors and the AGO were not able to determine if monies in the accounts have been safeguarded or how they have been used. That is the heart of the matter. It is the entire system of accounts.

There is no remotely similar problem in the Government. As I have mentioned, AGO has given the Government an unmodified audit opinion on its financial statements, both in the latest audit as well as in previous years. This means that the accounts of all the Government departments, Ministries and Organs of State are reliable, and public funds are properly accounted for. The same is true for the Statutory Boards which have their respective auditors. They all received unmodified audit opinions from their respective auditors in their latest audits.

If I can put it simply, the whole house of AHPETC's finances is unsafe, if you look at what the AGO findings say. Both AHPETC's own auditor and the AGO could not certify the AHPETC house as structurally safe, structurally sound. Apart from it being unsafe and unsound, there

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are also many individual defects and problems.

By comparison, the Government agencies audited by AGO do not have unsafe houses. The house is safe. There is no question as to whether public monies are fully accounted for. There are some repairs needed to the house in specific areas but everyone can be confident that the house is safe. And there is also full visibility. The curtains are not drawn. There is full visibility. This is the fundamental difference.

Mr Png Eng Huat.

The Deputy Prime Minister said that the findings in the AGO's report are mostly not repeated; they are not repeat findings. How did the Minister arrive at that conclusion because AGO, when it does audits, it selects agencies and it may not select the same agencies or Statutory Boards every year. For example, the People's Association, the last time AGO did an audit was quite some time ago. How does the Minister arrive at the conclusion that most of the findings are not repeat findings?

I would not be able to say that every fault or lapse found this year has never happened before. As the Member said, AGO, like any external auditor, can only make selective audits and focus on different transactions each year in different agencies. However, if the Member asks me for an assessment, looking at all the years of the AGO's reports ─ and I must say that AGO is a very thorough organisation ─ it is clear that lessons are taken in each and every case. There are one or two instances where you literally get a recurrence of the same problem, which we take very seriously. But by and large, lessons are taken.

I have to emphasise that there will be no perfection in this matter. From time to time, there will be human lapses and, despite the rules having been put in place and strengthened after initial audit findings, you will sometimes get people overlooking the rules. But by and large, if we look at the way Government agencies have responded to the AGO reports, actions have been taken, disciplinary actions have also been taken and improvements have been made. We do track this.

We also track whether there is a recurrence in the same agency or the same type of problem. In this year's report, for instance, there was only one recurrence out of that whole set. We track every single lapse to see, "Has this happened before? Were the lessons taken after the last time it happened?" And we found only one example where, in fact, there was a recurrence of the same type of lapse.

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Ms Sylvia Lim.

Madam, some supplementary questions for Deputy Prime Minister Tharman. He made some reference in his answer to the audit done by AGO on AHPETC, and I would like to ask him some questions on this.

Firstly, is the Deputy Prime Minister aware that the Town Council has since filed the subsequent audited accounts for FY2013/2014 by 30 June 2015?

Secondly, can the Deputy Prime Minister confirm if he has read those accounts?

Thirdly, the auditors who audited our accounts, which were recently submitted on 30 June, is the Deputy Prime Minister not aware that out of the 13 disclaimers that were put into our previous accounts, the auditors have confirmed that only three remained unresolved?

Last of all, is the Deputy Prime Minister also not aware that in this recent audit that we did for FY2013/2014, our auditors actually made the observation that except for certain specific issues, the Town Council has actually complied with the Act, in terms of keeping proper accounts and books?

I have been reading the reports regarding the latest accounts. First, of course, it has to be noted that they were submitted very late, several months after they were meant to be submitted to the Ministry of National Development (MND). MND, in fact, issued a reply to queries on the matter, which I have read. The accounts are still qualified with disclaimers of opinion. They are qualified on several accounts.

I should note also that these are new auditors appointed by AHPETC. They have flagged eight different areas of concern involving non-compliance with legal and regulatory requirements ─ eight areas where there was non-compliance. And these were fairly basic areas. They were not minor areas of infraction. There were still matters to do with related-party transactions, quite significant matters. There were lapses with regard to transfers to Sinking Funds, which are an extremely important matter for all Town Councils: failure to transfer monies to Sinking Funds when due is really putting the house at risk. The transfers that AHPETC made, according to its own auditors' report, were late. And as the Member will recall from the AGO's previous report, errors were discovered in the computations only after AGO's audit. So, there is something seriously wrong there.

There were also problems to do with the accounts themselves: problems to do with the opening balances; problems to do with determining the accuracy of the service and

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conservancy charges (S&CCs) that were owed to the Town Council; problems to do with accounting for creditors and accrued expenses. So, it is not something to be white-washed. When the house is structurally unsafe, one does not just go and put a new coat of paint on the front walls. I think it needs a very hard look. The foundations need to be put in place. It is hard work. But you have had a lot of time to do so.

Ms Sylvia Lim.

Madam, Deputy Prime Minister Tharman has not actually answered my questions whether he accepts that in the FY2013/2014 accounts which our auditors approved, that they have noted that out of the 13 disclaimers from the past, only three remained unresolved. So, I would like him to confirm whether he accepts that point.

Secondly, does the Deputy Prime Minister also accept that some of the areas which our auditors highlighted were actually carried over from the previous Town Council's opening balance issues, for example? That is the second point.

The third point, also regarding the Sinking Fund transfers, I think it is public knowledge that the Town Council has still not received its operating S&CC grants for FY2014 and FY2015. So, is the Deputy Prime Minister not aware of that as well?

Last of all, does the Deputy Prime Minister not accept what I put to him earlier that the auditors' opinion was that except for the specific observations, we have complied with the Act?

This is like saying that, except for the fact that the pillars of my house are in serious danger of collapsing, everything is fine. The examples that I have given of the areas that the auditor has qualified do strike me, as a Finance Minister, as being fairly serious examples. They are not minor infractions which you put a coat of paint over. They are very serious examples. So, I would, really, strongly advise not to get into the game of saying whether it is three or eight and so on, but to look into the substance of the matter. These are very serious issues, of failure to transfer monies to the Sinking Funds, being unable to account for your S&CCs after a few years. They are very serious matters to be taken seriously by everyone up and down the line. I would strongly advise that.

Second, on the matter of grants ─ was that what the Member asked about? Here, again, I have looked at MND's statement on the matter which I have in front of me. I am sorry to have to go through it again, but I will have to take Members through the key issues.

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First, AHPETC had made a rather unusual request that the MND grants ─ which ought to be split, going by the normal rules and procedures, between the Sinking Fund and the operating fund ─ AHPETC made an unusual request for all the monies to go into the Sinking Fund. And MND, despite the unusualness of this request, said it was prepared to consider the suggestion and merely asked for some cash flow information to ensure that, if MND does as requested, the delivery of essential services would not be compromised. That was an entirely reasonable request by MND. They are willing to entertain the suggestion AHPETC made, but they would like some information to make sure that delivery of essential services is not compromised.

AHPETC has not answered these questions. They are very reasonable questions, legitimate questions, and it has not answered these questions. And this is exactly the same thing as what happened in 2014.

I think the Member will also know ─ and I do not have my materials in front of me ─ that what is owing from the operating fund to the Sinking Fund is actually a very substantial sum. Even if you take into account MND's grants ─ which MND is willing to discuss with AHPETC, and you have part of the MND grant that has to properly go into the Sinking Fund and another part which goes into the operating fund – the amount that is owed to the Sinking Fund from the operating fund would not be solved by MND grants. There is a more fundamental problem.

2 Mr Png Eng Huat asked the Minister for Culture, Community and Youth in respect of the audit on the People's Association that is reported in the Report of the Auditor-General for FY2014/2015 (a) what are the 13 businesses or services that have been given tenancy contracts totalling $3.67 million without competition and what are the reasons given; and (b) what are the seven claims totalling $114,767 made by the Chairman of the CCC to himself and what is the total amount of the three claims that have no supporting documents.

(for the Minister for Culture, Community and Youth): Mdm Speaker, the Auditor-General's Office (AGO) audited the People's Association (PA) and the Grassroots Organisations' (GROs) compliance with the financial rules set by PA for GROs.

First, on tenancy contracts. PA's financial rules allow Community Club Management Committees (CCMCs) to seek the approval of PA headquarters (HQ) for the waiver of competition for the award of tenancy contracts where they have valid reasons to do so for the benefit of residents. Unfortunately, there were 13 tenancy contracts cited by AGO for

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waiver of competition without prior approval from PA HQ. These are:

five contracts by two community clubs (CCs) with poor locations to provide children enrichment, food and entertainment services. One CC is in a housing estate under redevelopment and the other is in a new housing estate in its early stage of development;

one contract for the installation of an automated teller machine (ATM) by a particular local bank to complement ATMs of two other local banks in the neighbourhood;

one contract for the renewal and continuation of childcare services for the convenience of the parents and their children;

three contracts for the introduction of new community lifestyle concepts to encourage family bonding and to inject vibrancy in the neighbourhood;

two contracts for food outlets that are popular with heartlanders, including youths and families with young children; and

one contract for a non-profit community organisation that promotes healthy lifestyles, in particular, for senior residents.

Notwithstanding the good intentions of the CCMCs in bringing in these services for the benefit of the residents and that they had benchmarked the rental rates offered against similar rental rates in the area, they did contravene the financial rules of PA in not seeking prior approval from PA HQ for the waiver of tender.

PA acknowledges our shortcomings in this area and has taken immediate steps to enhance compliance.

The second area is with regard to claims by a Citizens' Consultative Committee (CCC) chairman. The seven claims made by the chairman of a CCC to himself were:

one case of immediate financial assistance for a needy family at a funeral wake;

a working dinner and an appreciation dinner for volunteers and community partners; and

four claims for workplan retreats.

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The claim for financial assistance presented to the needy family at a funeral wake had no supporting document. However, the amount presented to the family was witnessed by a few other volunteers who were present.

The two claims for the working and appreciation dinners were supported by receipts. As for the four claims related to two workplan retreats, one had supporting documents. Even though the original receipts for the other three claims amounting to $56,050 were misplaced, the CCC had subsequently verified the amounts claimed with proof of payment from the vendor.

Although there was no evidence of dishonesty, the CCC chairman concerned has taken personal responsibility for these lapses and resigned from his position.

Madam, as a Statutory Board managing public funds, PA takes our financial governance seriously. Our accounts are subject to annual statutory audits. The last time our accounts received an adverse opinion was for FY2012. The adverse opinion was issued not for financial irregularity, but because the GROs' accounts were not included in PA's financial statements. PA has since consolidated all the GROs' accounts into our financial statements. We have received clean opinions for our FY2013 and FY2014 financial statements.

This AGO audit is over and above our annual audits. By having multiple layers of checks and transparency, we ensure a high level of vigilance over the integrity of our financial management. While we cannot completely eradicate human error, being vigilant means these are the exceptions rather than the norm.

AGO is doing its job and has done an impartial audit. PA takes the AGO findings seriously. We have taken swift and decisive action to put things right immediately. When things go wrong, we do not shy away from taking responsibility and tough action to put things in order.

Mr Png Eng Huat.

Mdm Speaker, I just have three questions. Just now, the Minister said that there was documented proof for one claim. So, the AGO's Report is wrong, as the Minister was trying to say that there is actually one claim where there are no supporting documents.

The second question is about sample size. There are about 1,800 GROs. Can the Minister share what is the sample size and how many were audited? The third question is about the adverse opinion that PA got due to the GRO accounts which were not cited, not presented or included in the PA accounts, and that was why the auditor gave it the adverse opinion.

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But the Minister said that there were no irregularities. How does the Minister know that, because the auditor has not seen the GRO accounts?

Mdm Speaker, first of all, let me correct the point brought up by Mr Png. It is that of the four claims, only one had supporting document; three did not at the point of claim. Subsequent to the observation by AGO, the CCC went back to the vendors to retrieve the evidence of payment. In other words, there was a lapse in the procedure, but they have rectified that by verifying the claims with the vendors.

Secondly, sample size. Mdm Speaker, PA has no decision over the sample size. In fact, all these are decided by AGO. However, it is in the interest of PA to ensure that these lapses are isolated in some cases and not widespread across the whole organisation. The GRO accounts have been subject to internal audits every year by public auditors appointed by PA. In other words, it is not that the accounts have not been audited all these years; it is not that it is being subject to this sort of audit for the first time. So, I think it is important to highlight that we do not depend on AGO to audit our accounts. PA, as a grassroots movement, has been doing its internal audits for all GROs all these years. And since 2012, we have consolidated all accounts into PA's accounts and subject the whole account for external auditing.

Thirdly, Mr Png asked about the adverse opinion and irregularity. It is important that Mr Png recognise what Deputy Prime Minister Tharman said earlier. There are two different types of audit. One is about auditing the accuracy, the reliability of your financial statements, of your accounting system. That is the function of an external audit conducted by the external auditor. The second type of auditing is about compliance, the compliance audit. For the GRO, as I had mentioned earlier, all our GRO accounts have been subject to internal audits all these years. That is the reason why I say it with confidence that there was no irregularity at the systems level.

3 Mr Lim Biow Chuan asked the Minister for Transport whether LTA has reviewed and approved the contingency plans by SMRT to provide alternative transport whenever there is a breakdown in the train services.

(for the Minister for Transport): Mdm Speaker, the Land Transport Authority (LTA) requires the rail operators to have Rail Incident Management Plans (RIMPs) which set out their responses to train incidents and the measures they will take to mitigate the inconvenience caused to commuters. These measures include regular provision of information to affected commuters, free boarding of public buses and bus bridging services at affected stations. These plans are

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approved by LTA and are regularly reviewed and enhanced.

For a disruption on the scale of the 7 July 2015 incident, which involved the entire North-South and East-West Lines during the evening peak, the operators' Rail Incident Management Plans were not adequate and it is understandable why many affected commuters were unhappy with the management of the incident. The capacity of alternative travel connections between the heartlands and the city needed considerable strengthening and would have required significantly more resources beyond the Singapore Mass Rapid Transit (SMRT)'s to mitigate the impact.

Therefore, following the incident, LTA has reviewed the measures and worked with both bus operators to focus on an emergency ramp-up of capacity on bus connections. In the event of a similar rail incident, we will boost the capacity for regular trunk services calling at affected Mass Rapid Transit (MRT) stations connecting the city and the heartlands. Depending on the scale of the rail disruption, a number of buses will be diverted from other bus services with lower demand to enhance these identified services. The operating hours of Government-contracted City Direct Services can also be extended.

Let me now turn to bus bridging which stakes commuters at affected stations to the unaffected stations so that they can continue their journey. For a large-scale disruption where bus bridging cannot be effectively implemented at all stations, a special bridging plan will be implemented to serve commuters living in major towns in the northern, western and eastern parts of Singapore. This will allow commuters in the city to travel via alternative MRT lines to key interchange stations, such as Bishan, Paya Lebar and Buona Vista, and subsequently use the special bridging buses for onward travel to towns, such as Ang Mo Kio, Woodlands, Tampines and Choa Chu Kang. This special bridging plan works similarly in the reverse direction.

By doing so, commuters affected by a large-scale disruption will have two options to travel between the city and the heartlands through: firstly, trunk services running at increased frequencies and expanded capacity; or secondly, a combination of alternative MRT lines and special bridging services.

LTA and the operators have worked out the arrangements and the improved contingency plan was put in place recently, about a month after the incident.

Mr Lim Biow Chuan.

Mdm Speaker, may I ask the Senior Minister of State: on the event in question on 7 July, the feedback given was that the stations were quite

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chaotic. Many of the commuters did not know what was happening and they did not know where to go or what bridging buses were provided. If, indeed, LTA has worked with the transport operators about how to manage a rail disruption again, then why was the situation not better managed? Having said that, would there be better management, better practices for a similar kind of breakdowns? Would there also be contingency plans to better manage announcements as well as crowd control at the stations? At the end of the day, many commuters accept that trains, like all mechanical things, do break down. But they want to know, "What do I do next as a commuter? Do I get stuck in the station?" Or for commuters who are going to the MRT stations, they have to know, "Do I even go there?" How do we prevent people from going to the train stations when the system has broken down?

Mdm Speaker, indeed, the operators, together with LTA, do have Rail Incident Management Plans. But I think it is fair to say that for the incident that occurred on 7 July, the scale of it was not something that they planned adequately for. That is why the management of the incident fell short by commuters' standards.

What we want to do is to improve on those contingency plans, whether it is in relation to the bus connections or other travel connections that the commuters really want. In terms of the information, those areas are still being looked into as well. Whilst we are continuously looking into those areas, the contingency plans relating to the bus connections have been firmed up and they have been put in place.

Mr Cedric Foo.

A contingency plan is one way to make sure that we minimise inconveniences to commuters but a breakdown on the scale of 7 July is really so large that it is probably better to make investment to try and prevent such a massive breakdown, through redundancy or isolating breakdowns to certain segments of the track, rather than to invest in an entire large-scale contingency plan. Not only have they got to find the buses, they have to find the drivers and so on. Can the Senior Minister of State comment on that?

Mdm Speaker, I thank the Member Mr Cedric Foo for raising that point. Indeed, quite apart from focusing on corrective maintenance, preventive maintenance is equally important, if not more so, particularly as the system is no longer the new system that we had years ago. That is an area of work that will continue to occupy the LTA as well as the operators' attention for quite some time to come.

At the same time, if and when an incident were to happen, it is reasonable for commuters to expect that the management of it ought to be up to mark. That is also an area

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that we want to make sure that we improve on. So, both of these have to proceed in parallel.

Mr Lim Biow Chuan.

Mdm Speaker, I just wanted to put this to the Senior Minister of State again. I asked whether practice runs are conducted, just like army training. You practise and practise and practise to make sure that if, indeed, it happens again, the repercussions are better dealt with. Do you have contingency plans, do you practise the situation where the system breaks down again and there are thousands of commuters in the stations, and what do you do with them?

It is not just in land transport that there are exercises being conducted on a regular basis. In air transport and in sea transport, we do it, too. I think we are not the only agencies which do that. In other Ministries, there are also tests of contingency planning.

But there is nothing quite like the real thing, where the commuters' reactions are not entirely predictable and their patterns of travel are also not entirely as you expected before. This tested the strength of our plans and we identified areas that we ourselves think ought to be improved further. So, that is something that we will put our attention on doing.

As I had mentioned earlier in my reply, the incident happened about a month ago. We wasted no time in making sure that we looked into how onward travel connections can be made by affected commuters. We thought that one area of opportunity and one area that we can do much better in when it comes to large-scale disruptions are in making sure that the capacity and frequency of the trunk services which can provide alternative connections for the commuters are quickly ramped up.

How do you mobilise the resources to do that? We have worked it out with the operators and that plan is in effect.

Mr Zaqy Mohamad. Last question.

I thank the Senior Minister of State for the clarifications earlier on. My question is related to my Parliamentary Question on the Government Contracting Model (GCM). I just want to ask the Minister, when we have more operators in future, how does this work out if we have a mass disruption like that? Are we prepared to coordinate, not just beyond the current SMRT and TransitLink Services, but with more operators contracted to do this service?

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There are provisions for the resources available to these Government contracted operators and they can also be brought to bear in an incident of this nature.

4 Ms Ellen Lee asked the Minister for Defence (a) whether SAF has provided adequate opportunities for women to participate and excel in their military careers; and (b) what is the impact of more SAF regular servicewomen on our national defence.

Madam, in response to the Member's question, deployment and advancement within the Singapore Armed Forces (SAF) is meritocratic and based on the principle of "best person for the job", regardless of gender, race, religion or other personal characteristics. Over the years, the servicewomen in the SAF have made good progress across all our career schemes. We have quite a number of them and they serve in a diverse range of vocations. We have women Guards Commanders, women Naval Divers and Fighter Pilots. And a good number have also risen to helm key positions – Department Heads, Battalion Commanders, Brigade Commanders, and Division Sergeant Majors.

Let me give Members a few examples. Senior Warrant Officer (SWO) Jennifer Tan – Members would have remembered seeing her in this year's National Day Parade (NDP) as she came in with her children in a tank. She is in our 2nd People's Defence Force (2PDF) and is the SAF's first female Division Sergeant Major and also the first female Parade Regimental Sergeant Major for the NDP in 2011.

We have Military Expert 6 (ME6) Sima Rai who is the Commanding Officer of 6th Army Maintenance Base, which performs engineering and maintenance work on various platforms, such as the Unmanned Aerial Vehicles (UAVs) and the High Mobility Artillery Rocket System (HIMARS). In fact, her unit was named the best Combat Service Support unit for four consecutive years.

In 2005, Col Karen Tan was our first servicewoman to be promoted to the rank of Colonel when she was Commander, Central Manpower Base (CMPB). Many of you would be familiar, recently in July this year, we had our first female Brigadier-General, Head of Air Intelligence and Director (Special Projects) Brigadier General (BG) Gan Siow Huang.

Indeed, our servicewomen have contributed significantly to our national defence and keeping our skies, seas and homeland safe. Today, we have 1,500 uniformed servicewomen serving in SAF, about 7% of our Regulars. Many of them have also contributed to the success of our multinational peace support operations overseas, such as in Afghanistan and the Gulf

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of Aden.

MINDEF and SAF are committed to provide a challenging and fulfilling career, which Ms Ellen Lee asked about, and help our Regulars realise their full potential. To do this, we recognise that we have to support our people's life-cycle needs. In keeping with our national workforce policies, our human resource (HR) policies have progressed over time to be able to accommodate flexibly and support these needs, for example, when they get married or when they become parents. As a result of these incremental changes to create a supportive work environment, that is how servicewomen are able to have fulfilling careers in MINDEF and SAF.

I am happy to also tell Members that our practices are in line with international agreements that Singapore is a party to, such as the United Nations (UN) Convention on the Elimination of All Forms of Discrimination against Women (CEDAW).

SAF seeks to bring in more good, capable women to serve in the military, with career schemes that are designed to appeal to a diverse range of career interests. We are committed to provide a fulfilling profession for our servicewomen, and we look forward to women's continued contributions towards Singapore's defence.

Ms Ellen Lee.

Madam, I have one supplementary question for the Minister. Given the increasingly heavy responsibilities that our Regular servicewomen have played alongside their male counterparts, will the same opportunities be made available for servicewomen to be appointed the Chiefs of the Army, Navy, Air Force and the Chief of Defence Force, and even be recommended for political office?

Madam, I do not see why not. As I said, opportunities are open to them. We promote based on merit and if a particular recommendation comes across my desk that this woman is deserving to be Chief of Navy, Chief of Army, Chief of Air Force or Chief of Defence Force, I will say yes if she deserves it. For political office, it is not my purview, so I will let the Prime Minister decide that.

Ms Irene Ng.

I am heartened by the Minister's reply. In my duties as a Government Parliamentary Committee (GPC) Member for Defence, I have interacted with many women officers, including commanders in combat units, and they hold their own in a male-dominated workforce. Can I just ask if the Minister would agree that

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military promotions tend to be highly structured and officers have to serve a series of appointments to move up the ranks?

If that is the case, would the Minister agree that there is a need to make sure that there are gender-neutral standards that are also rigorously validated at every point? Can I have the assurance of the Minister that SAF implements a policy to ensure that no woman who is best qualified is denied access to an assignment that is open to both men and women?

Madam, I agree and it is to our interest, to SAF's interest, to make sure that the people we have, we avail them of the opportunities to serve, so that they can move up the hierarchy. We are short of manpower and we have to make use of everybody we have, and I agree with Ms Irene Ng that we have to make sure that not only do they have the opportunities to be promoted, but that they are given the postings to prove themselves – I think that is the main point.

As long as it is gender-neutral, people have their opportunities, and it was in this vein that I said that our practices comply with the UN CEDAW, that there is no discrimination in our practices against women.

5 Er Dr Lee Bee Wah asked the Minister for Social and Family Development in light of the recent case of unauthorised withdrawal of funds from the Child Development Account (CDA) (a) what is the Ministry doing to tighten control over the CDA; (b) how will the Ministry assist parents to trace the transaction records if past bank statements are not available; (c) whether all affected parents have been notified of the unauthorised withdrawals from their CDA accounts; (d) how often are CDA accounts audited; and (e) whether these accounts are subject to audit by the Auditor-General's Office.

(for the Minister for Social and Family Development): Mdm Speaker, the Ministry of Social and Family Development (MSF) has several levels of checks and controls in the use of funds from the Child Development Accounts (CDA).

Firstly, parents need to authorise approved institutions, such as childcare centres and kindergartens, to make deductions from their child's CDA by signing an authorisation form.

Secondly, the approved institution has to also ensure proper procedures are followed before the deductions are made. This includes obtaining parents' authorisation and making

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sure all records are properly kept.

Thirdly, CDA banks are required to provide parents with monthly statements with details of the deductions from their child's CDA.

Finally, MSF regularly conducts checks on approved CDA institutions to ensure that the procedures are followed and deductions are in order.

It is through all these checks that a recent MSF audit showed unauthorised withdrawals from the CDAs of several children at Sweetlands childcare centres. In the interest of the parents, we may revoke the status of the persons authorised to carry out CDA deductions at Sweetlands.

The matter has now been referred to the Commercial Affairs Department (CAD) for investigation. While the investigations are being carried out, all the Sweetlands centres can continue to operate as there is no issue regarding the safety or well-being of the children studying in the childcare centre.

MSF is closely monitoring the CDA deductions and the childcare subsidies claims that are made by Sweetlands centres. We have also kept parents of the children who are studying in Sweetlands childcare centres abreast of all these developments. We have also advised them to check the validity of their CDA deductions. Parents who have not kept the statements can request for these statements from their respective CDA banks.

The Auditor-General's Office (AGO) audits Government financial statements and carries out test checks of selected grants given by the Government. The controls of the Government's matching grants to CDAs are subject to the AGO's audit. However, the subsequent use of these monies in the individual CDAs of account holders are personal in nature and do not come under the ambit of the AGO's audit.

MSF takes a very, very serious view of any breaches of the use of CDA funds. We will continue to carry out and improve the various levels of checks and controls, in addition to the four levels of checks and controls that I have mentioned earlier, and to remind approved institutions to comply strictly with the terms and conditions as well as the statutory requirements. We will also not hesitate to take disciplinary actions or enforce penalties where needed, to safeguard the interests of the parents and the children.

Er Dr Lee Bee Wah.

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Mdm Speaker, I would like to thank the Parliamentary Secretary for her comprehensive answer. Unfortunately, one of the Sweetlands centres is in my constituency and this incident has caused a lot of anxiety among the young parents.

I have two supplementary questions.

First, how does the Ministry ensure that the services provided by Sweetlands are not affected, and not just the services but that the quality remains? That is the main concern of the parents.

Second, the person responsible or behind these unscrupulous acts must be dealt with severely and I would like to ask what kind of punishment will be meted out.

I want to thank the Member Er Dr Lee Bee Wah for her two supplementary questions. I think she raised three points. One is continuity of service, quality, as well as any punitive measures.

I will talk about the service. As I have mentioned briefly earlier, while we have forwarded these investigations to be carried out to CAD, there are no issues with the centres in respect of the safety as well as well-being of the children under their care. There are about more than 700 children in the 11 centres and we are working very closely to make sure that the safety and well-being of the children is not being compromised. On that end, the centres' operation can continue.

I would like to take the opportunity to share that from 29 July to 31 July, more than 20 staff from MSF and Early Childhood Development Agency (ECDA) were sent to the 11 centres. Why do we do that? We sent one MSF staff together with one ECDA staff to each centre – at least two staff at each centre; and three staff, for those centres with bigger cohorts – to ensure that other than looking at this CDA-related issue, we also have the ECDA staff look at the interests of the children, teachers and principals.

I want to give the Member that assurance. The 20-plus colleagues from MSF and ECDA were there over three days, in the morning and evening, to coincide with the timing when parents, grandparents or caregivers will send the children to school and fetch them home. The MSF and ECDA staff have spent significant efforts to explain this very recent development to the parents, grandparents and the caregivers. We have also provided very comprehensive letters about the measures being taken and the touch-points they can go to if they need any clarifications. That is one point. I wanted to stress a bit on the continuity of the service to assure Members who may have Sweetlands centres in their wards.

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The second point that the Member raised is about quality. Members would know that since April 2013, ECDA was set up and the agency has been very focused on rolling out measures to provide parents and children access to quality and affordable childcare.

How do they do so? One important measure is that all the childcare centres are licensed by ECDA to ensure that the centres adequately meet the requirements in a few areas: the physical environment; safety, which I mentioned earlier; health, hygiene, nutrition, staff training, programme and curriculum as well as administration. So, it is a very comprehensive licensing framework, and the licence tenure for a childcare centre can range from six months for those centres where we need to watch very closely. The tenure can be as short as six months or as long as 24 months. So, these measures are in place. I want to assure Members who have Sweetlands centres in your wards – that through all these measures, ECDA will keep a close watch and ensure that the centres continue to provide quality care to the children in the school.

Related to the second supplementary question that the Member has raised, I just want to reiterate what I mentioned earlier – that MSF takes a really serious view of the breaches of the use of CDA funds. And we will certainly not hesitate to take disciplinary actions or enforce penalties where required, with a view to protecting the interests of the parents and the child.

The matter is now with CAD. They are carrying out the investigation and I hope Members understand that we should let it take its course. In addition to that, I also want to say that should there be any individuals from Sweetlands who are convicted of criminal offences, ECDA has the authority to request that they step down as director of the centre. But I think we should let the investigation take its course.

6 Ms Irene Ng Phek Hoong asked the Minister for Social and Family Development (a) what are the safeguards put in place to prevent elder abuse and neglect from becoming more prevalent as our society ages and the pace of life becomes faster; (b) whether existing measures can be strengthened; and (c) what role can neighbours and the larger community play in looking out for the welfare of vulnerable seniors and reporting abuse cases.

Mdm Speaker, ageing well is something that we should all strive for. Just as there are exciting opportunities, there are also concerns that we need to look out for. Some elderly persons will become vulnerable due to their physical state, mental condition or social isolation. There is a need to step up efforts to protect these seniors from abuse and neglect.

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One main cause of abuse is caregiving, which can be challenging and stressful. To support caregivers, the Ministry of Social and Family Development (MSF) and Ministry of Health (MOH) are expanding the range of services available – day care centres, home-care and respite care. There is also an eldercare hotline and a Caregiver Training Grant for caregivers to acquire the necessary skills and knowledge to care for their loved ones.

My Ministry is taking further steps to strengthen our system to detect and respond to potential abuse and neglect of vulnerable persons. We are working with social service agencies to train our community partners and grassroots leaders to better recognise signs and symptoms. We are also bringing more community agencies and touchpoints into our National Family Violence Network to be more responsive to reports of abuse and neglect.

If I may illustrate, just yesterday, Edwin Tong and I were visiting the residents in the Joo Chiat area to understand the issues on the ground. One of the issues was precisely what the Member had raised – the number of elderly in the estate. A number of them may be living alone and, therefore, how best do we look out for their welfare.

This is where I think there is a system approach from Government agencies and volunteer welfare organisations (VWOs). But I believe that there is space for the community to play an active role. How do we reach out to find out who these old people are, how are they doing, what is their welfare like, are we able to organise amongst ourselves regular visits to check on them or to visit them just to keep them company? We can build a network which actually will strengthen community ties but at the same time looking out for the elderly in our community. And how do we then fuse this in with the broader systems provided by VWOs and the agencies concerned? I think that is an area that we can look at as a model to develop not only just in a particular area, which is ageing, but across the island because this is a trend that will develop in Singapore in the not very distant future.

In addition, we will also – and this is important – strengthen our laws to better protect vulnerable adults. We will be introducing a new Vulnerable Adults Bill later this year which will empower public officers to gain access to homes, assess the risks, act on suspected abuse and provide statutory protection to the victim where needed.

To be able to attend to suspected cases early and prevent serious harm, again, we will need help from the community. Those of us who are living in the environment – neighbours, friends – we can help to pick up tell-tale signs. Doctors, social workers, various people in the community, when we begin to pick up issues, we can flag them up when we are concerned. Community partners and members of the public, really, are the eyes and ears on the ground. Neighbours can reach out and offer practical support to caregivers, such as referring them to support services or attend to the elderly where possible. But if abuse or neglect is suspected, they should notify the Police, call the Comcare hotline or alert MSF-funded Family

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Violence Specialist Centres. For this reason, we are spreading the message that abuse and neglect should not be condoned and all of us in the community can play a role.

Ms Irene Ng.

Mdm Speaker, elder abuse may be more common than is recognised, particularly amongst seniors with dementia or other cognitive impairments. Does the Minister agree that the barriers to recognising and reporting elder abuse should be addressed? One of them is the lack of a clear definition of elder abuse. Other barriers to reporting elder abuse include lack of knowledge, denial, fear of making the situation worse, desire to maintain family relationships, fear of ending up in Court or a lack of belief that the situation will improve.

Can I ask the Minister how does the Ministry plan to deal with these barriers? What are the Ministry's plans to increase the public's awareness of elder abuse, neglect and exploitation, and to educate people on detecting, intervening in and responding to such cases?

Madam, elder abuse is associated with increased use of health services. Health professionals are thus well positioned to spot elder abuse. Would the Minister also consider making it mandatory for health professionals to report cases of suspected elder abuse?

Mdm Speaker, I fully agree with the concerns expressed by the Member. As more of us age, like I said, it is important that we age well but there are vulnerabilities. For the reasons that the Member has cited, there are various barriers, which is why, as a whole, the community needs to play a part, so that among all of us, somewhere along the line, we ensure that no one falls between the gaps.

Firstly, families; and I think one will be education – and we will want to step up more in terms of creating awareness amongst family members. And this is even amongst the elderly themselves to understand what represents neglect and what recourse is available to them.

Secondly, within the family, it is not just immediate family, there is also the extended family, when we begin to detect that something is not quite right, would the family members, whether immediate or otherwise, be able to intervene? And then you have the broader community, you have friends, neighbours, people who are in the community that you associate with, such as medical healthcare workers, will be one example. I am not sure whether we are at the stage where we want to make it mandatory. But we can also make sure that they do understand what the symptoms are, what are the signs to look out for, and whether they could, in turn, trigger the process in terms of alerting the local SSOs, Family

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Service Centres, to be able to follow up on these cases. So, really, it takes the whole community. Just as we say it takes the entire village to raise a child, I think it takes an entire village to look after our elderly as well.

So, I think raising awareness; education, that is something we need to do; strengthening the laws is important because the change of the laws will allow us to step in even when the barriers are there, meaning that where we deem that an individual's welfare is at stake, the laws will allow us to step in and intervene. But this is where I said there is only so much that you can mandate. But I think there is a very big role for the community to play. If all of us begin to be aware of how we could contribute to that, we can actually bring down the numbers. Although the numbers may not be large but for the elderly who are affected by this, it is not just physically traumatic, it is emotionally very trying, especially when it comes from family members. So, it behooves all of us to play a part.

7 Mr Baey Yam Keng asked the Minister for Culture, Community and Youth (a) what is the Government's commitment to maintain the status of the Singapore Botanic Gardens as a UNESCO World Heritage Site; and (b) how can the public play a role in this process.

Madam, we are fully committed to protecting the Singapore Botanic Gardens as a United Nations Educational, Scientific and Cultural Organization (UNESCO) World Heritage Site. And all Singaporeans have a part to play in this.

On the Government's part, we have robust measures in place to protect the Gardens and to ensure that it remains a peaceful green oasis in the city.

For example, the Urban Redevelopment Authority (URA)'s comprehensive, integrated and transparent land use planning framework ensures that new developments in the vicinity of the Gardens are compatible with it. For example, the Gardens has a Height Control Area defined by the area contained within a one-kilometre radius centred from the Bandstand in the Gardens. Within this buffer, no new development would be allowed to be visible from the Bandstand.

We have also put in place measures to protect the more vulnerable heritage trees. Future developments will be designed and sited carefully to spread the visitors more evenly across the Gardens.

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We will continue to engage UNESCO closely in our efforts to protect the Gardens. We will adopt a transparent and proactive approach and seek advice from their experts to ensure the site is well-protected. For example, last year, UNESCO's expert advisory body, the International Council of Monuments and Sites (ICOMOS), visited Singapore to inspect the Gardens. One of their recommendations was to have more frequent inspections for historical buildings within the premises of the Gardens. The National Parks Board (NParks) took in their feedback and has increased the frequency of these inspections by professional engineers from every five years to every two years.

Ultimately, the Gardens belongs to all Singaporeans. It is our shared responsibility to upkeep it. We have formed a World Heritage Site Management Committee that includes residents, experts and volunteers. Any future developments within the boundaries of the site which are not flagged up in our Nomination Dossier to the UNESCO World Heritage Committee will be discussed by this Site Management Committee. NParks also has a comprehensive volunteer scheme covering a wide range of areas, including gardening, conducting guided tours and assisting in the curation and documentation of different herbarium specimens.

Beyond this, we all have a part to play in ensuring that the legacy of the Gardens is passed on to future generations. We can visit often with our families and friends, so that it can forever be cherished both as a place of historical significance and fond personal memories. We have a collective responsibility to keep the Gardens clean and well-preserved.

Prof Tan Tai Yong.

In addition to maintaining and managing the Gardens, are there plans for a sustained public education effort to highlight the significance of this particular historical site, the history of our country, so that people can understand what this means to be us and it is not just about maintaining a place but preserving the significance of the place and appreciating what the place means for Singapore?

Madam, that certainly is something we intend to do. In fact, the NParks has already stepped up its heritage tours and public outreach efforts. Visitorship to the Gardens has increased by 35% after the announcement that the Gardens was inscribed as a World Heritage Site. So, in the last few weeks, we had seen a sharp increase in visitorship. Many Singaporeans are curious about the Gardens and its history and heritage. So, the heritage tours have been very popular and NParks will be making available more of such tours and also doing even more to reach out to Singaporeans about the historical significance and rich heritage of the Gardens.

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8 Mr Zaqy Mohamad asked the Minister for Manpower over the past five years (a) what is the trend in the number of cases relating to race- and language-related discrimination in the workplace; and (b) how many of such cases in respect of job interviews, hiring practices and workplace practices have been enforced.

9 Mr Zainal Sapari asked the Minister for Manpower (a) whether the Tripartite Alliance for Fair Employment Practices (TAFEP) has been effective in reducing discrimination at workplaces; (b) whether the existing framework of measures are sufficient to send a strong message that workplace discrimination, particularly those related to race and religion, will not be tolerated; and (c) what recourse can an individual take should the person feel that there is discrimination due to race and religion

(for the Minister for Manpower): Madam, with your permission, can I take Question Nos 8 and 9 together?

Yes, please.

Thank you, Madam. The Tripartite Alliance for Fair and Progressive Employment Practices (TAFEP) was set up in 2006 to promote fair employment practices. TAFEP released the Tripartite Guidelines on Fair Employment Practices in 2007. Recognising that the key to dealing with discrimination issues is to change employers' mindsets, TAFEP adopts both a promotional and capability building approach in helping employers to adopt the Tripartite Guidelines.

An employee who feels discriminated against can approach TAFEP for assistance. In the last five years, TAFEP has, on average, received less than 80 race-, language- and religion-related discrimination complaints per year against employers. This number has remained fairly stable. When TAFEP engages these employers, the large majority will rectify their employment practices.

Where there is evidence of non-compliance with the Tripartite Guidelines on Fair Employment Practices, TAFEP will refer these cases to the Ministry of Manpower (MOM) for investigation. In 2014, MOM investigated and took action against nine employers for race, language and religion-related discriminatory employment practices. These employers were issued stern warnings and had their work pass privileges curtailed.

I am happy to note that most employers that have been approached by TAFEP have responded positively and have adopted fair employment practices. Only a small minority are

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referred to MOM for enforcement. This shows that our current approach has worked well.

Mr Zainal Sapari.

What was the outcome of MOM's investigation into the recent alleged cases of discrimination that went viral over the social media, in particular, I am referring to the first case of an alleged discrimination against a Chinese-Muslim woman and, the second, an alleged discrimination of a foreign national recruiting his own nationality for a position in the company?

First, let me note that MOM takes a very firm and serious stance against workplace discrimination. There is no place for discrimination at the workplace and we expect all employers to consider and treat employees fairly, complying with the Fair Consideration Framework and the Tripartite Guidelines on Fair Employment Practices. MOM, together with TAFEP, will seriously follow-up on every discriminatory case received.

For Ms Heng's case, I understand that TAFEP contacted both Ms Heng as well as the company in question. According to the company, the person who posted the discriminatory post is not one of their employees. In fact, they have actually lodged a Police report to investigate the incident. With regard to the other nationality-based case, I think it is in relation to a Myanmar national. I understand that we are currently looking into the matter.

Let me highlight that given that social media has the potential to amplify a case, it is important that we get our facts right. And let me also assure the House that MOM, together with TAFEP, will continue to work at addressing workplace discrimination. In fact, recently, my Minister has also announced additional measures under the Fair Consideration Framework as well as the National Jobs Bank to address nationality-related discrimination cases, and to build a strong Singapore Core.

Mr Zaqy Mohamad.

I thank the Senior Minister of State for her earlier clarification. Just a couple of things. One, I am surprised that the number of 80 per year, in terms of complaints related to race and religion, is quite low, considering the fact that many Singaporeans and, especially among the minority communities, the Malay and Indian communities who have come forward to raise concerns that there is discrimination that goes on. Does MOM think that this number is a little under-declared, or do you think that it is a barrier for people to come forward to make reports?

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Secondly, specific to the example given by the hon Member Mr Zainal Sapari was the case of Ms Heidi Heng. That is one where it is very difficult to prove in the sense that you do not overtly put up the requirements but, at the same time, at the backend, when they found out she was a Chinese Muslim, but she meets the language criteria – not specific for this case but there are cases which we have heard of – how many of such cases have been reported? And out of the 80 cases that MOM receives a year, how many are actually found to be guilty and what form of recourse does MOM have with regard to race and religious discrimination by employers? Work pass discrimination only works if you are dealing with the nationality-based discrimination. But for religious- and race-based discrimination, what is the recourse taken on such employers and how many of them are found guilty per year for the last five years?

As I have noted earlier in my reply, we believe that the way to tackle workplace discrimination, whether it is age-related or based on nationality, race, language, religion or any other workplace discrimination, fundamentally, you have to change the mindsets of employers. Therefore, we have adopted the promotional approach as well as the capability-building approach but coupled with enforcement by MOM for cases where there is prima facie evidence of discriminatory practices.

As I have also noted, the number of cases over the last five years has actually remained relatively stable at about 80. We encourage anyone who feels that they are victims of discriminatory workplace practices to come forward and inform TAFEP. But when we talk about the promotional and capability-building approach, we are also talking about educating the employers, human resource (HR) practitioners, the supervisors in the companies not to inadvertently practise discrimination at the workplace.

In addition to that, last year, 2014, there were nine cases. As I have said, for the less than 80 cases that come up to us, TAFEP will investigate every case and when there is no evidence, as the Member has noted, it is not easy. It is unlike other employment offences, it is actually not easy to prove discriminatory practices. Therefore, if TAFEP sees that there are gaps in HR practices or gaps in some of the hiring practices, TAFEP will advise and share guidelines with these employers.

In most instances, the employers respond positively. They will either take down or refine the job advertisements. For gaps in HR practices, employers will rectify them. In most cases, they indicate that they are supportive of fair hiring employment practices.

So, for the cases which are unresponsive or recalcitrant, and where there is prima facie evidence of discriminatory practices, they will be referred to MOM for investigation. For last year, we enforced action against the nine companies. Whilst it is true that these are not nationality-based, the fact is that most companies do employ some numbers of foreign

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workers and, therefore, curtailing their work pass privileges is very serious for them. We curtail the work pass privileges for six months and more.

Mr Zaqy Mohamad.

Just a clarification: for the nine cases that were found guilty, what were the measures taken on them? Were they all deprived of work passes or were there other measures taken?

Out of the nine companies, one received a stern warning, which means that they will be on our watch list and eight had their work pass privileges curtailed.

10 Dr Chia Shi-Lu asked the Minister for Education whether the Ministry will consider requiring all schools and educational institutions organising overseas trips for students and staff to purchase travel insurance which cover medical evacuation or treatment for pre-existing conditions.

(for the Minister for Education): The Ministry of Education (MOE) already requires the schools that we directly supervise to purchase travel insurance that provides unlimited coverage for medical evacuations and repatriation expenses for overseas trips that are organised or endorsed by these schools. Similar arrangements are in place for the autonomous universities, polytechnics and the Institute for Technical Education.

Most travel insurance policies do not cover expenses, including those relating to evacuation or repatriation, that are incurred as a result of pre-existing conditions. Rather than to simply require all schools to purchase enhanced policies, MOE's approach has been to require schools to undertake a careful assessment when deciding whether their students or staff should participate in such overseas trips.

Where the pre-existing condition is serious or of a nature that makes it unsuitable for a student to go for the overseas trip, such as heart problems or epilepsy, alternative activities will be organised for the student. Where the pre-existing condition is less serious or can be managed safely with appropriate medication, schools will allow the student to participate in the overseas trip, provided, amongst other things, they are satisfied that the activities conducted are appropriate for the student and there are adequate medical facilities available at the destination to manage and support the student's pre-existing condition. The

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student's parents are also consulted to ensure that they are comfortable with the arrangements. A similar approach is adopted for school staff.

Dr Chia Shi-Lu.

I thank the Senior Parliamentary Secretary for the very comprehensive reply. The question is that there are probably some parents with children with pre-existing illnesses, but not of a very severe nature, who are agreeable to have their children participate in these overseas trips. But there might be concern that if something does happen of a medical nature to their children, the policies purchased for them by the school may not cover them for these illnesses. There certainly do exist policies out there which do cover pre-existing illnesses admittedly for a premium. But I do not think it is a prohibitive one. So, I would just like to ask again if MOE would consider giving this option to the schools in question. With regard to the cost, I suppose it is something that can be decided by the school or the parents or amongst both parties.

Madam, as I have said in my reply, we leave it to the schools to decide on whether a student or a staff member is fit or good enough for certain types of overseas trips. Some overseas trips can be very physically challenging, but some may not be. So, students with certain pre-existing medical conditions may be allowed or encouraged to take part in some overseas trips which may not require too much physical exertion.

However, if the physical condition or pre-existing medical condition may be serious, we would not allow such students or staff members to take part in the overseas trip. Of course, it is up to the individual families or staff members to decide on whether they want to take part in the activities, for which we do not disallow, or whether they want to buy additional travel insurance coverage. So far, as far as I know – and this was only done from the end of last year – there is only one insurer that provides additional travel insurance coverage, which means that the demand for such additional travel insurance coverage for pre-existing medical condition is relatively low.

Mr Pritam Singh.

Mdm Speaker, I would like to ask the Senior Parliamentary Secretary, did the insurance coverage acquired by MOE for the ill-fated Tanjong Katong Primary School (TKPS) Kota Kinabalu (KK) expedition include expenses related to medical treatment for injuries? Secondly, will MOE be setting up a fund to consider the prospect of reimbursing long-term injuries sustained by students as a result of the KK tragedy, if it has not already?

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I think, generally, yes, Madam. The travel insurance coverage includes accidents and treatment of injuries as a result of accidents, as well as repatriation. As for the treatment after the participating students or staff members have returned to Singapore, the travel insurance cover a portion of further treatment back at home up to a cap. So, I think this is a common industry practice.

Mr Pritam Singh.

I thank the Senior Parliamentary Secretary. In the case of the second question, in the event that the cap is breached because of the nature of some of these injuries, will MOE consider at least assisting affected students and families with some compassionate assistance?

Madam, the Member may be aware that MOE has worked with the Temasek Cares for a programme to assist families to manage the cost of treatment after the insurance coverage cap has been reached. [Please refer to "Clarification by Senior Parliamentary Secretary to the Minister for Education", Official Report, 18 August 2015, Vol 93, Issue No 23.]

Apart from that, there are also schemes to help other families which have been affected by the accidents involving the students and staff members of Tanjong Katong Primary School.

11 Mr Hri Kumar Nair asked the Minister for Education what is the rationale for excluding students in Specialised Independent Schools who are suffering from dyslexia from receiving subsidies to participate in the dyslexia remediation programme conducted by the Dyslexia Association of Singapore and whether the Ministry will review that policy.

(for the Minister for Education): Madam, the setting-up of Specialised Independent Schools is a recent development in our diversified education landscape. They offer a customised curriculum to students who have an aptitude and inclination towards mathematics and scientific inquiry, applied learning and creativity, sports or the arts. Currently, there are a few students in the specialised independent schools attending the dyslexia remediation programme conducted by the Dyslexia Association of Singapore (DAS). And we have worked with the schools to provide school-based financial assistance for students in need.

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MOE will rationalise the existing subsidy arrangements to extend the subsidy to eligible students from Specialised Independent Schools when they participate in the DAS remediation programme. This will take effect from January 2016.

3.00pm

Order. End of Question Time.

[Pursuant to Standing Order No 22(3), provided that Members had not asked for questions standing in their names to be postponed to a later Sitting day or withdrawn, written answers to questions not reached by the end of Question Time are reproduced in the Appendix.]

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[(proc text) Order for Second Reading read. (proc text)]

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

Madam, globalisation has increased the transnational reach of organised criminal groups (OCGs). Advances in technology enable OCGs to operate with greater ease across national borders and reap substantial benefits. For example, in February 2015, Australian Police seized illegal drugs worth AUD$12 million from an international drug syndicate and arrested Hong Kong and Canadian nationals. In 2013, Hong Kong Police arrested more than 1,800 people in a major crackdown on triads covering Hong Kong, Macau and parts of mainland China. They have been charged with offences, such as illegal gambling and money laundering.

Madam, Singapore is one of the safest cities in the world, but we are not immune to the threat of organised crime. Our law enforcement agencies have detected the work of organised syndicates behind some serious criminal offences, such as drug-trafficking and unlicensed moneylending. A serious offence is a threat in its own right. But it poses an even greater threat to our safety and security when perpetrated by an organised crime syndicate. Such OCG are well-resourced and able to mount and sustain large-scale illegal activities over prolonged periods.

OCG often operate across jurisdictions. Their leaders mastermind and finance criminal activities from overseas to deliberately distance themselves from their henchmen who execute the actual crimes. Therefore, the highest echelons of OCG are often able to evade detection and arrest. Even when apprehended, it is more difficult to secure a conviction against them because of the structure of their organisations and their indirect link to the criminal acts.

So, we need laws that target the pernicious activities of these OCG and those in their higher echelons. They are the ones who instruct and intimidate others into criminal acts, yet are most shielded from enforcement. That is why we need an Organised Crime Bill to enhance our ability to disrupt the activities of OCGs at various levels of their hierarchy so as to prevent them from establishing a foothold to perpetrate serious crimes.

In developing the Bill, my Ministry has drawn reference from similar legislation in the United Kingdom, Hong Kong, New Zealand, Australia and Canada, as well as the United

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Nations Convention on Transnational Organised Crime (UNTOC). My Ministry has also consulted the legal fraternity in Singapore and incorporated several of their suggestions.

Madam, let me now take Members through the key provisions of the Bill.

Clause 2 of the Bill defines an OCG as a group that comprises at least three persons, however organised, which has as one of its objectives the obtaining of material or financial benefits from the facilitation or commission of any serious offence.

There are three key elements to this definition. First, the OCG must comprise at least three persons. The focus is on groups that pose an organised crime threat to Singapore. This approach is similar to UNTOC and laws in Canada, New Zealand and Australia. The Bill does not target ad hoc groups that commit isolated crimes.

Second, the purpose of forming the group must be to obtain a financial or other material benefit from the commission of serious offences. These serious offences comprise the third element and are listed in the First Schedule to the Bill. These are offences like murder, drug-trafficking and unlicensed moneylending under existing laws, such as the Penal Code, the Misuse of Drugs Act and the Moneylenders Act.

Part 2 of the Bill sets out the general offences relating to the activities of an OCG. The provisions under Part 2 allow our law enforcement agencies to tackle organised crime activities which threaten our safety and security, even if these acts are committed outside Singapore. I will now elaborate on the key clauses and will refer to them collectively as Part 2 offences.

Clause 5 makes it an offence to be a member of an OCG.

Clause 6 criminalises the recruitment of members for an OCG. The penalties for this offence are enhanced if the person recruited is a vulnerable person or a person who is below 21 years of age.

Clause 7 makes it an offence to instruct a person to commit a Part 2 offence or any other offence for an OCG. This targets the masterminds and leaders, who wield significant influence, control the finances, make key decisions and instruct others to execute the criminal activities. Our intent is to punish the person who instructs the commission of an offence for the OCG, that is, the "brains" of the operation, more severely than the person who carries it out.

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Clauses 8 and 9 make it an offence to provide or procure aid to commit a Part 2 offence or any other offence for an OCG. Clauses 10 and 11 respectively make it an offence to allow OCG to use one's premises to conduct illegal activities and for any person to deal with the illicit property of OCGs. The aim is to deprive these groups of resources. The penalties for these offences in relation to an individual are imprisonment for up to five years, or a fine of up to $250,000, or both.

Clause 12 makes it an offence to facilitate the commission of Part 2 offences or serious offences for OCGs and the penalties in relation to an individual are imprisonment for up to five years, a fine of up to $100,000, or both.

Clause 13 empowers a Court to impose enhanced penalties for the commission of any offence if the offence is committed at the direction of or for an OCG. The Bill doubles the maximum fines associated with the offence; and the maximum imprisonment term will be increased by two or five years.

Madam, let me now turn to the Powers and Orders that can be issued on a conviction or non-conviction basis.

Mdm Speaker, our enforcement agencies always seek to prosecute criminals in Court and secure a conviction. Where appropriate, upon such criminal conviction, the sentencing Court can also order the confiscation of benefits of crime under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act (CDSA).

However, criminals in the upper echelons of OCGs often create many layers and elaborate structures to distance themselves from the criminal acts. Hence, it is not always possible to prosecute such criminals and secure a conviction beyond reasonable doubt. To effectively disrupt the activities of an OCG and deny such criminals their ill-gotten gains, we need other levers.

This Bill will, therefore, provide for the issuance of Preventive Orders and a civil confiscation regime. Applications for some of these Orders and for civil confiscation will be heard in civil proceedings, which are separate and independent of any criminal proceedings. This means that the application can still proceed even if the person has not been charged or has been acquitted. These Orders can also be made against a person who has committed a serious offence associated with an OCG before this Bill comes into force.

Mdm Speaker, the Bill provides for the Courts to issue three Preventive Orders: the Organised Crime Prevention Order (OCPO), the Financial Reporting Order (FRO) and the Disqualification Order. These Orders aim to safeguard law and order and protect the public

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by preventing, restricting or disrupting the involvement of persons in organised crime.

Clause 15 provides for an OCPO which can be made to restrict a person's activities whether or not he is convicted, that is, on a conviction or non-conviction basis. These include restrictions on the premises to which a person may have access and how he may associate with others. Before an Order is issued, the Court must first be satisfied that the person has been involved in a Part 2 offence or a serious offence associated with an OCG; and second, have reasonable grounds to believe that the Order would protect the public by preventing, restricting or disrupting any involvement of the person in such offences.

Clause 17 specifies that an OCPO can be in effect for up to five years. Clause 19 provides for such persons to be monitored by means of an electronic device.

Clause 21 provides for the Court to issue an FRO requiring a person to furnish financial reports as required. This Order can be issued on a conviction or non-conviction basis.

Clause 22 specifies that this Order can be in effect for up to five years, when issued on a non-conviction basis. When issued upon conviction, the FRO can be in effect for up to the period of imprisonment imposed, plus a further five years.

The OCPO and the FRO are subject to a number of important safeguards. All applications have to be made by the Public Prosecutor (PP). Applications that are made on a non-conviction basis must be heard by the High Court. The subject will have the opportunity to be heard before an Order is made. In addition, third parties can make representations or appeals against the making, varying or discharging of an Order.

Finally, the Disqualification Order, which can be issued only on a conviction basis, serves to prevent the person from acting as a company director or taking part in the management of a company. The maximum duration of the Order is aligned to the Disqualification Order provided under the Companies Act.

Let me now turn to Part 9 of the Bill, which provides for the civil confiscation of benefits from organised crime activities on a non-conviction basis.

Mdm Speaker, it is widely acknowledged that the primary motive for organised crime is financial gain. Organised crime is big business involving large sums of money. The UN Office on Drugs and Crime estimates transnational organised crime to be a global business worth US$870 billion.

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To effectively deal with organised crime, we must be able to deprive these criminals of their ill-gotten gains. This would also diminish the incentive and the resources for persons to carry out organised crime activities. This is the ultimate objective of the civil confiscation regime.

This civil confiscation regime is similar to the conviction-based regime for the confiscation of criminal benefits under CDSA. The main difference is that a confiscation order may be obtained under the Bill by proving, on a civil standard of proof, that is, on a balance of probabilities rather than beyond reasonable doubt, that a person has carried out organised crime activities.

The proposed civil confiscation regime is not unique to Singapore. New Zealand, Australia and the United Kingdom have similar regimes, which typically extend beyond organised crime to include benefits and proceeds derived from serious offences committed by individuals. This Bill confines our civil confiscation regime to organised crime.

The main provisions of the civil confiscation regime are largely similar to those in CDSA, with changes made for a non-conviction-based model of confiscation, and the introduction of additional safeguards.

Clause 61 provides for the PP to apply to the High Court for a confiscation order. The High Court will issue a confiscation order, if it is satisfied on a balance of probabilities that the subject has: (a) carried out organised crime activity within the statutory period of seven years; and (b) derived benefits from the organised crime activity.

Similar to the CDSA, the subject is presumed to have benefited from the organised crime activity if he holds property that is disproportionate to his known income sources and is unable to explain those holdings to the High Court's satisfaction.

Under a confiscation order, the subject is required to pay an amount equivalent to the value of his benefits from the organised crime activity. This amount is recoverable as a judgment debt due to the Government.

Clauses 56 to 60 provide for the High Court, on application by the PP, to issue orders which restrain the property of the subject from being disposed of or dealt with. The High Court can also impose charges on the property of the subject for the purpose of securing payment of money to the Government.

Mdm Speaker, substantial safeguards have been incorporated into the civil confiscation regime. First, all applications have to be made by the PP and heard in the High Court. There

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is also a provision for appeals to be made to the Court of Appeal. Second, there is a statutory limitation period to the civil confiscation regime. The PP must commence civil confiscation proceedings within seven years of the subject carrying out the organised crime activity. Third, the Bill protects the rights of innocent third parties. In addition, the High Court has the power to provide relief from confiscation, if it is assessed that the confiscation would result in undue hardship to the subject or third parties.

Mdm Speaker, the Organised Crime Bill targets OCG because they pose a significant threat to our safety and security with their capacity and resources to commit crime on a larger scale and on a sustained basis. This Bill will criminalise and punish persons who carry out acts in support of OCG. It will allow our law enforcement agencies to tackle organised crime threats decisively by strengthening their powers to detect, investigate, disrupt and curb their activities, dismantle their organisation and deprive them of their ill-gotten gains.

The OCPO, FRO and the civil confiscation regime will allow us to take pre-emptive measures, not only on a conviction basis but also on a non-conviction basis with appropriate safeguards. Such powers have precedents in other reputable jurisdictions and are vital to prevent organised crime and to deprive OCG of resources.

Taken together, the Organised Crime Bill will allow our law enforcement agencies to tackle the scourge of organised crime decisively. Mdm Speaker, I beg to move.

[(proc text) Question proposed. (proc text)]

Mr Hri Kumar.

Mdm Speaker, I rise to support the Bill. The Bill boosts our abilities to clamp down on and sanction individuals involved in OCG. It introduces a wide range of organised crime offences under Part 2. In particular, the Bill significantly enhances punishments under section 7 and section 13 and creates new offences.

Under section 7, a person who instructs another person to commit an offence for an OCG will face the punishment prescribed for that offence and more. Where the offence is committed in consequence of his instruction, the instructor can be fined up to four times the maximum fine prescribed for that offence and have an additional 10 years tacked onto the maximum term of imprisonment prescribed for that offence.

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And under section 13, a person who commits an offence will be subject to an enhanced punishment regime where it can be proved that the offence was committed for an OCG. Such a person can be fined up to twice the maximum fine prescribed for that offence and have a further five years added to his prison sentence. These enhancements are significant and will help the Police to clamp down on OCG.

When I first mentioned this Bill with some friends last week, their immediate reaction was: is the mafia or are the triads operating in Singapore? I hope the Minister will share the relevant statistics/facts and elaborate on the particular types of OCG that the Ministry is concerned with and intends to target. He mentioned moneylending in his speech. Could he give us other examples? This would give us a better understanding and appreciation of the Bill and its purpose.

My next point is one for clarification. The Bill defines a "locally-linked organised criminal group" as "a group that has its only purpose, or one of its purposes, the obtaining of a financial or other material benefit from the commission by or the facilitation of the commission by, any person of any serious offence". The purpose of the group is, therefore, key to its characterisation as an OCG and is an important element in establishing the offence. But how does one establish a "purpose" in relation to the serious offence? Let us take, for example, a group of youth who, out of folly, perhaps may steal a motor vehicle. This is a serious offence under the Bill's Schedule. How will it be ascertained whether the requisite purpose is present such that the gang constitutes an OCG?

I would like to ask the Minister: what evidence will be looked at to determine what the purpose of a group is, especially if the group is based overseas? This is important because all the sanctions in the Bill – Part 2 offences, OCPOs, FRO, Confiscation Orders, all of them – are predicated upon a person belonging to, acting for or being involved with an OCG. And while the issue of whether a group is an OCG may sometimes be clear, some cases will fall in a grey area. This has implications on whether the enhanced penalties under section 13 and attendant sanctions on the group's members will apply.

My next point has to do with OCPOs and FROs. These orders may be issued under a conviction regime or by the High Court under a non-conviction regime, in other words, no criminal offence has been found or found by the Court. The Court is given a very wide mandate to impose restrictions under an OCPO. An OCPO may contain "such prohibitions, restrictions or requirements" and "such other terms" as the Court considers appropriate for the purpose of protecting the public by preventing, restricting or disrupting any involvement by the person in any Part 2 offence or any serious offence associated with an OCG. Indeed, section 16 gives an open-ended list of restrictions that may be imposed and these include restrictions on an individual's travel within and out of Singapore, means of communication as well as his access to and use of any premises or items. Section 19 even provides for

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electronic monitoring of an individual subject to an OCPO.

The same threshold of "protecting the public" applies for FROs, which require individuals to make financial reports setting out particulars of their financial affairs. Significantly, while both OCPOs and FROs must not be in force for longer than five years, it appears that both orders can be renewed indefinitely by the Court.

It is indisputable that OCPOs and FROs must have a broad scope if they are to be effective in crippling the activities of OCG. The trade-off is that the power to order OCPOs and FROs may be exercised in an oppressive or abusive manner. In this regard, I have two questions for the Minister.

First, there is a higher chance that a mistake may be made under a non-conviction regime because of the lower standard of proof: proof on a balance of probabilities as opposed to proof beyond a reasonable doubt. What safeguards are in place to minimise the chances of OCPOs and FROs being unduly issued?

Second, how will the threshold of "protecting the public" be satisfied? What must be shown apart from the fact that the individual has been involved in Part 2 offence or an offence associated with an OCG? This has a direct bearing on how liberally orders for OCPOs and FROs will be made.

To conclude, the Bill gives us more tools to attack and dismantle OCG and ensure that they and their sympathisers do not benefit from the proceeds of crime. We will be able to intervene and disrupt all stages of the group's operations, from the initial stages of recruitment and the instruction of others, to the later stages where offences are committed and the group profits from their criminal acts. And where individuals pose a particular risk, we can restrict and monitor them via OCPOs and FROs.

But it is precisely because the Bill contains such formidable provisions that we have to be careful that powers under it are exercised prudently and only when the circumstances warrant it. With that, Mdm Speaker, I support the Bill.

Mr Alvin Yeo.

Mdm Speaker, I rise in support of this Bill. It is aimed at combating organised crime by equipping our law enforcement agencies with the weapons to pre-empt organised crime activities, pursue their leadership who may be based overseas

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and deprive them of their ill-gotten gains.

There is increasing evidence that OCG here are expanding their links with overseas syndicate. Not only are their networks expanding, their range of criminal activities is also diversifying, resulting in a larger, more complex mix of threats at our very doorsteps. Currently, we may feel that organised crime here is under control, albeit still extant. This may lead to some questioning why we should pass this Bill. But it is precisely because we need to disrupt and stultify the spread of organised crime before it becomes entrenched, before it grows to a point where organised crime threatens public safety and economic stability, that we need this Bill now.

I have, however, two queries on this Bill. The first concerns the criteria our Home Team will apply to determine the extra territorial coverage to tackle transnational organised crime.

Under the Bill, this requires a tight nexus between the offence in question and the resultant harm to Singapore. The rationale for this nexus requirement is not to overtax our Home Team's resources in requiring them to assist the international community to tackle cases with little or no impact in Singapore.

I do not question the logic of this. However, I worry that we draw the line too tightly around what offences have an effect in Singapore. This may affect the cooperation that we need of foreign law enforcement agencies to detect, investigate and apprehend the leaders and key members of syndicates who may be located overseas. This is, indeed, the challenge of combating international criminal networks.

Most foreign law enforcement agencies work on the principle of mutuality where they will render assistance to another country's police force, which would do likewise for them. Thus, if out of concern for husbanding our Home Team resources, we define offences which have an effect in Singapore too narrowly, we risk losing the very cooperation internationally that is essential to combat transnational crime syndicates.

Could the Minister address this concern and clarify how he will balance with competing aims of not over-exerting our Home Team's resources on one hand with the ready provision of assistance to foreign law enforcement agencies necessary to secure their mutual cooperation?

The second concern I have relates to the civil confiscation process which reverses the burden of proof on a subject to prove the legitimacy of his property. In other words, any property which is disproportionate to the subject's known sources of income and which he cannot explain to the Court's satisfaction is presumed to be the benefits of organised crime.

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This reversal of the burden of proof is similar to that under CDSA.

However, CDSA is directed at those convicted of corruption, drug trafficking or other serious offences. In other words, a conviction is necessary before the civil confiscation process, with its reversal of the burden of proof, is triggered.

Under this Bill, the subject of this confiscation process need not have been convicted of a criminal offence under the Bill. Indeed, he may have been tried for an offence under the Bill and even acquitted. To then subject him to the reversal of the burden of proof, where the subject has to justify and explain all his property or otherwise have it presumed that they represent the proceeds of organised crime, can work a severe injustice if he is truly innocent.

After all, to be presumed innocent until proven guilty is still a fundamental tenet of criminal justice. To presume the subject's property to be the proceeds of organised crime where he has not been convicted or even charged and then acquitted would, in my view, undermine that fundamental principle.

Let me make clear that I entirely support that our agencies should have the ability to take civil confiscation proceedings against any subject, even if he has not been convicted of any offence. And I take full note of what the Minister has said that with the upper echelons of organised crime syndicates, they may be at several removes to the actual members who commit the crimes. But it is the reversal of the burden of proof in a situation where no conviction is obtained that I feel gives rise to the potential for injustice.

Could the Minister clarify how the risk of such injustice could be reduced, if not eliminated? Could the reversal of the burden of proof only apply when the subject has been convicted of an offence under this Bill or, at least, of a similar offence overseas? Or could the risk be addressed by prosecutorial guidelines which should be publicised, which set out clearly when civil confiscation proceedings could be initiated against subjects who have not been convicted, or even acquitted, of offences under the Bill?

This is important as, while we all want to make Singapore free of organised crime, we do need to respect the rights of individuals who may be accused or suspected but not yet convicted of organised crime offences. Overall, I agree that we need to enhance the measures to combat organised crime and I do support the Bill.

Minister, your reply.

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Thank you, Mdm Speaker. Mdm Speaker, may I have your permission to ask the Clerk to distribute a handout to Members?

Yes, please. [A handout was distributed to hon Members. Please refer to Annex 1.]

Madam, as the Clerk distributes the handout, I want to thank Mr Hri Kumar and Mr Alvin Yeo for supporting the Bill and also for the queries that they have raised. The issues they have raised fall into three broad areas. First, of the need for the Organised Crime Bill; second, how the Bill will be used to tackle organised crime more effectively; and, finally, the safeguards, especially for some of the provisions pertaining to civil confiscation. I will address each in turn.

Madam, both Members have agreed with the need for the Bill and I welcome their support. OCG are a menace and pose a serious threat to our safety and security. And they have the resources to commit serious crimes on a large scale and for prolonged periods. They structure themselves to evade law enforcement, especially at the higher echelons, by having layers and elaborate structures, each with discrete and separate functions.

While overall crime, and organised crime in particular, in Singapore is generally under control, we must ensure that we have the necessary powers to effectively address the threat of organised crime should the need arise. This is especially important as OCGs will evolve with globalisation and advances in technology. They will find new ways to perpetrate crime and evade the law. This Bill will strengthen significantly our ability to prevent organised crime from taking root in Singapore.

Mr Hri Kumar asked about the types of OCGs and organised crime activities that we are concerned about. Our law enforcement agencies' greatest concerns today lie with the involvement of OCGs in crimes, such as drug trafficking and unlicensed money lending (UML).

I would like to explain this further using the illustration in the handout. The handout describes the typical structure of a drug trafficking group, and it is based on actual cases that the Central Narcotics Bureau (CNB) has dealt with. The graphic shows the complex and layered nature of the OCG. The OCG's activities are initiated and coordinated by the mastermind, OCG Leader X, who is located overseas − the large big circle, you cannot miss him and he looks fairly sinister. He takes orders for drugs from his partners in Singapore and instructs drug supply syndicates and courier coordinators to deliver drugs to these partners. Once brought into Singapore by couriers, the drugs pass through multiple hands, channels and layers before being sold to drug abusers. The illicit proceeds from the drug trafficking activities flow back to OCG Leader X and further finance the illegal activities of the OCG. The

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arrows in green give you the flow of funds.

Currently, CNB can take action under the Misuse of Drugs Act against persons in the lower rungs of the OCG, such as the runners and street-level traffickers. These are the persons in the bottom two layers of the OCG. With the Organised Crime Bill, such persons can be subject to enhanced penalties for committing these offences for an OCG.

However, the OCG will be able to easily regroup by replacing these lower-level operatives by recruiting more persons to perform such roles and continue their operations. To be effective, we need to take action against persons higher up in the hierarchy.

The persons in the middle tiers of the OCG – A, B and C – are OCG Leader X's partners in Singapore. In most cases, CNB is able to arrest and charge such persons under current laws.

Under the Bill, the local partners will also be liable for new offences, such as instructing the commission of an offence for an OCG and recruiting members for an OCG, that is, Part 2 offences. And if convicted, they will face higher penalties under the Bill.

To tackle such OCG, this Bill provides additional levers beyond criminal sentences. The PP can apply for an OCPO to restrict the activities of persons A to C, for example, by placing restrictions on the premises to which they have access to, and the manner in which they may associate with other persons. This will curtail their involvement in the OCG's activities.

The PP can also apply for an FRO to require them to furnish financial reports to CNB. This will allow CNB to trace and track their finances.

Finally, the Bill will allow us to deal more effectively with the mastermind, the OCG Leader X. These leaders, like X, usually operate from overseas and they would create many layers and structures to distance themselves from the actual drug trafficking activities and ensure that they do not personally handle the drugs. This makes it difficult to secure a drug trafficking conviction against them.

With the new offences created under this Bill, OCG Leader X will be liable for criminal offences, such as instructing the commission of an offence for an OCG and recruiting members for the same group.

In addition, the benefits he derives from his criminal activities can be subject to the civil confiscation regime. This will deprive him of his gains, disrupt the activities of his OCG and

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curtail its further growth.

I hope this example illustrates to Members, somewhat more vividly, how an OCG can pose a greater threat to Singapore's safety and security, even if they are not similar to the traditional notions of mafia or triads that Mr Hri Kumar referred to.

Mr Hri Kumar has also asked for relevant statistics regarding organised crime. As I have mentioned earlier, and Members have acknowledged, our overall organised crime situation is generally under control. Nevertheless, in the area of drugs, between 2012 and 2014, CNB seized almost $47 million worth of drugs and broke up over 60 drug syndicates. Many of these syndicates are small-scale operations in Singapore without elaborate structures, similar to the local networks of Persons A, B and C in the illustration.

However, in some of these cases, there are suspected links between these syndicates and transnational organised criminal elements, in other words, the activities go beyond our borders and are part of a larger structure.

We must also be prepared for the emergence of new types of organised crimes and modalities that can threaten Singapore's safety and security.

Mr Hri Kumar asked about the evidence that will be used to determine whether the purpose of a group is to obtain a financial or other material benefit from the commission or facilitation of the commission by any person of any serious offence.

Madam, the purpose of the group can be established through its activities, for example, whether the plans and preparations of the OCG are focused on financial gain, how the serious crime is executed and how the group deals with the proceeds of the crime. In doing so, our law enforcement agencies will rely on evidence, such as the communications between the members of the OCG, statements recorded from witnesses and OCG members, any instruments of crime seized, and the conduct of the members of the OCG in relation to the offence.

So, in Mr Hri Kumar's example of a gang of foolish youths stealing a motor vehicle, if, in fact, the gang steals the vehicle and discards the vehicle thereafter and, it is an isolated case, the Penal Code would be the most appropriate lever with which to deal with this sort of criminal act. Let me also emphasise that the focus of this Bill is on OCG that commit serious offences on a sustained basis. The Bill does not target ad hoc groups that commit isolated crimes.

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Let me also take this opportunity to address Mr Alvin Yeo's question on the extraterritorial nature of offences created under the Bill. I acknowledge Mr Yeo's point that it is important for Singapore to be able to provide assistance to other countries in the area of organised crime as part of the international collaboration and cooperation that we have with overseas law enforcement agencies. However, the most important consideration, in deciding on the scope and coverage of new offences in the context of Singapore, is to criminalise the activities that are of greatest concern to Singapore. And this is the principle which has guided the manner in which we have drafted this Bill.

I want to assure the Member that this Bill, and the way it is drafted, will not impinge on our ability to render assistance to foreign law enforcement agencies when warranted by the situation. For example, the Mutual Assistance in Criminal Matters Act (MACMA) allows for mutual legal assistance to be provided for a wide range of offences and that is the basis on which our law enforcement agencies have been cooperating with their international counterparts.

Madam, Mr Hri Kumar and Mr Alvin Yeo have asked about the safeguards to ensure that the OCPO, FRO and civil confiscation orders, which can be sought through civil proceedings, requiring a lower standard of proof as compared to a criminal conviction, are used only in appropriate cases. I think these are valid points. I explained earlier some of the safeguards and I wish to reiterate them.

Madam, let me first say that the overall safeguards that the Bill provides for before an OCPO, FRO or civil confiscation order can be issued in civil proceedings. First, law enforcement agencies will investigate and build the case against suspected organised criminals. Their priority is to prosecute the criminals in Court as far as possible, in other words, to secure a criminal conviction. The decision to apply for one of the orders or for a civil confiscation order, in the absence of a conviction, is made separately by the PP. So, there is a separation between the law enforcement agency that does the investigation and gathers the evidence and the PP who makes the final assessment on whether such orders are to be applied for.

Second, these proceedings must be heard in the High Court, where the PP has to prove, on a balance of probabilities, that the defendant has been involved in a Part 2 offence, or a serious offence associated with an OCG. The defendant will have the opportunity to defend himself and he can avail himself of the same defences available if he had been subject to a criminal prosecution. The OCPO/FRO or confiscation order will be issued only if the High Court is satisfied with the merits of the case. There is also provision for appeals to the Court of Appeal.

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Let me now also address specific queries raised by Members. Mr Hri Kumar asked about the threshold of "protecting" the public: how the threshold of "protecting" the public will be satisfied before an OCPO/FRO is issued. This would involve the assessment of risk, that the person is still likely to be involved in organised crime activities without the Order.

Mdm Speaker, in deciding on the issuance of the Orders, the Court would have to balance the public benefit that the Orders would bring, in terms of greater security and safety, against the restriction and requirements that would be imposed on the person. In other words, the application for or issuing of the order must be commensurate with the risk of the subject getting involved in organised crime activity without the Orders. So, the law enforcement agencies and the PP would have to make an assessment of that risk and persuade the Court of that assessment before the Orders can be issued.

Let me also respond to Mr Hri Kumar's query on whether both Orders can be renewed indefinitely. This is not the case because if the law enforcement agencies see the need for a new order upon the expiry of the previous order, they would have to approach the PP to make a fresh application to the High Court, and it would be subject to the same risk assessment and test before the Court.

Mr Alvin Yeo also asked about the civil confiscation provisions which reverse the burden of proof, onto a subject to prove the legitimacy of his property. As Mr Yeo has pointed out, this approach is similar to that we have used in CDSA. And the civil confiscation regimes in New Zealand and Australia similarly put the onus on the subject of a civil confiscation proceeding to establish that his property is derived from lawful activity.

Let me also reassure the Member that the civil confiscation regime will be used judiciously against organised group criminals. The PP is required to first prove to the High Court, on a balance of probabilities, that the subject has carried out organised crime activity within the statutory period of seven years. A confiscation order is, therefore, not made simply on the grounds that the defendant cannot explain the origins of his wealth. We first, have to establish the predicate offence on the balance of probabilities.

It is fair to place the burden of proof, we believe, on the subject to prove the legitimacy of his property thereafter. After all, he is in the best position to explain how he derived those assets and these are also matters which are specifically within the subject's knowledge and which will be difficult for anyone else to prove. The subject will have the opportunity to show that his assets, which are disproportionate to his known sources of income, are not ill-gotten.

Madam, I want to emphasise that such provisions are not unique to Singapore. The preventive orders are closely modelled after the UK's Serious Crime Prevention Order and

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Financial Reporting Order. Countries like New Zealand, Australia and the UK also have civil confiscation regimes. In fact, these countries allow the use of such powers even against persons who commit serious offences without any organised crime influence. The experiences of these countries have shown that such tools are effective and necessary to prevent and disrupt organised crime. Having said that, I want to assure Members that the powers embedded in this Bill will be exercised judiciously with the strong set of safeguards that I have elaborated on.

Madam, let me conclude by emphasising the considerable harm that organised crime activities can cause to Singapore's safety and security. We, therefore, need law enforcement levers that can aid the fight against organised crime. And this is why we have studied the laws in other jurisdictions to develop the Bill, which is scoped to target the threats posed to Singapore by OCG. I urge Members to give your full support to the Bill, so that our law enforcement agencies will have the necessary powers and tools to tackle the scourge of OCG and continue keeping Singapore safe and secure. Madam, I beg to move.

[(proc text) Question put, and agreed to. (proc text)]

[(proc text) Bill accordingly read a Second time and committed to a Committee of the whole House. (proc text)]

[(proc text) The House immediately resolved itself into a Committee on the Bill. – [Mr S Iswaran.] (proc text)]

[(proc text) Bill considered in Committee; reported without amendment; read a Third time and passed. (proc text)]

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[(proc text) Order for Second Reading read. (proc text)]

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

Mdm Speaker, I would, first, like to outline why Singapore has become a signatory to the Articles of Agreement for the establishment of the Asian Infrastructure Investment Bank, or "AIIB".

AIIB seeks to drive infrastructure development and regional connectivity in Asia through financing support for its members. Working in partnership with other international financial institutions, such as the World Bank Group and Asian Development Bank, AIIB will play an important role in addressing development challenges. AIIB is a timely initiative, given that the scale of infrastructure needs in Asia is significant.

More importantly, the creation of AIIB signifies an additional milestone in, and a strengthening of, the existing international financial architecture. It is critical for Singapore, as an international financial centre, to remain plugged into the network of international financial institutions. We have thus decided to participate early and pro-actively in the negotiations for the AIIB Articles of Agreement, working with other countries to ensure that AIIB will have good governance and high standards.

As a member of this region, Singapore welcomes new initiatives that will promote greater infrastructure investment. Better infrastructure and connectivity will facilitate regional economic development and, in turn, provide positive spinoffs for the Singapore economy. It also creates opportunities for Singapore companies seeking to tap Asia's growth. For example, Singapore-based companies will have the opportunity to participate in the AIIB's projects in the transport, water, logistics and urban development sectors, to name a few.

Being a member of AIIB reinforces our ties with countries in Asia and beyond. AIIB enjoys good support around the world. A total of 50 countries have signed the AIIB Articles of Agreement, with another seven countries expected to sign by the end of this year. All ASEAN countries have joined as prospective founding members of AIIB. Other prospective founding members include major economies from Asia, Oceania, the Middle East, Latin

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America and Europe.

We are confident that AIIB will enjoy the legitimacy and credibility of a multilateral institution of high standing.

Let me now move on to explain our capital subscription amount to AIIB.

AIIB will be established with an initial authorised capital of US$100 billion. Of this, regional members will subscribe to US$75 billion, while non-regional members will subscribe to the other US$25 billion. There are 57 prospective founding members to AIIB, of which 30 are regional countries and 27 are non-regional countries.

Singapore plans to subscribe to US$250 million or 0.25% of AIIB's total authorised capital of US$100 billion. This is an appropriate level of contribution to AIIB, taking into account our current subscriptions to the World Bank and the Asian Development Bank. Amongst ASEAN countries, Singapore will be ranked sixth in terms of the size of our capital subscription to AIIB.

Singapore's capital subscription of US$250 million will give us 0.48% of the total voting share in AIIB. Of the US$250 million, 20% or US$50 million is to be paid-in, over five equal annual instalments. The remaining 80% or US$200 million of callable capital will not be paid in, except when decided by AIIB members in extraordinary circumstances. This is similar to the practice in other international financial institutions. To date, institutions, such as the World Bank and the Asian Development Bank, have not drawn on their callable capital.

The full capital subscription of US$250 million will be set aside from the surpluses built up in this term of Government.

Mdm Speaker, it is necessary that appropriate legislation be enacted to enable Singapore to ratify the AIIB Articles of Agreement and become a member of the Bank. To this end, the AIIB Bill enables Singapore to deposit an Instrument of Ratification stating that the Government has accepted the Agreement in accordance with Singapore's laws and that the Government will carry out its obligations under the Agreement.

Clause 4 of the Bill authorises the Singapore Government to subscribe to US$250 million of the initial authorised capital of the Bank. It also provides for Singapore to subscribe to future capital increases, provided that our total subscription does not exceed twice the initial subscription amount, except with Parliamentary approval. This is similar to the approach that we took for the ADB Act. Singapore's subscription to the Bank will be charged to the Consolidated Fund, similar to our capital subscriptions to the World Bank and Asian

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Development Bank.

The Bill also gives legal effect to the provisions in the AIIB's Articles of Agreement relating to the status, immunities, privileges and exemptions of AIIB and its officers. These are on par with those that Singapore has accorded to other international financial institutions, such as the International Monetary Fund, the World Bank and the Asian Development Bank. Mdm Speaker, I beg to move.

[(proc text) Question proposed. (proc text)]

Mrs Lina Chiam.

Mdm Speaker, Article 47 of this Bill on the AIIB provides immunity from search, requisition, confiscation, expropriation or any other form of taking or foreclosure by executive or legislative action.

In Parliament this year and last year, we have debated and passed the Monetary Authority Singapore (Amendment) Act and the Accounting Corporate Regulatory Authority (ACRA) Act. These two Acts serve to clamp down on money laundering and anti-terrorism funding.

My concern is whether it is appropriate for the Singapore Government to grant such extensive immunity, given the risk of fraudulent activities in financial institutions. Furthermore, this is a relatively new organisation, compared to other international organisations.

The Bill further seeks our approval on a waiver of tax. I understand this is also applied to other international organisations, such as the International Finance Corporation (IFC) and the World Bank. Are we trying to set a precedent for all future international organisations dealing with money?

The proposing Ministry owes Parliament a clearer explanation as to why we need to accord this organisation the same level of privilege. Do they provide employment for Singaporeans, or do they create a stronger financial ecosystem? Specifically, what additional benefits can this Chinese-originated entity provide for Singaporeans?

I have concerns that national funds parked in a Chinese entity will become too tightly linked to an economic network. The Chinese economy has grown for decades with the use

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of loose credit.

In public, the concerns cited by America about China has been a lack of clarity about the banks' governance and lack of track record and may fail to live up to the environmental, labour and procurement quality standards. To what extent will national funds be committed in this multilateral development bank and will Parliament have the powers to check on this creature later on?

Mdm Speaker, AIIB may boost our country's stand as a capital banking hub in Asia and, of course, our GDP growth. But, we need to assess whether it should come at the expense of our values as a nation. Mdm Speaker, I support this timely initiative and the Bill.

Mr Thomas Chua.

Madam, in Mandarin, please.

(In Mandarin): [Please refer to Vernacular Speech.] Mdm Speaker, having understood the background, objectives and scope of services of AIIB, I support the AIIB Bill.

Currently, Asia is the most dynamic region in the global economy, demonstrating the greatest potential; it is also stepping up in infrastructural development. However, many countries in Asia are still developing economies. Investing in infrastructural development projects would require much more financial support, technology and management expertise. The AIIB proposed by China will leverage on international financial resources to bring new impetus to the development of the Asian region.

Singapore is one of the original founding member countries of AIIB. In the past 50 years, we have accumulated a great deal of experience in urban infrastructural development, such as energy, utilities, waste management, public housing and transportation. We have also developed sustainable development solutions in water management. The Singapore International Water Week, CleanEnviro Summit Singapore and World Cities Summit hosted in Singapore have also attracted industry players, government officials and experts from every part of the world. These are Singapore's strengths in participating in projects of AIIB. Our businesses look forward to leveraging on AIIB to participate in more sizeable multi-national and regional infrastructural development projects.

How then can Singapore enterprises participate in Asian infrastructural investment projects? I think we can make reference to the Asian Development Bank. The Asian

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Development Bank was established in 1966, with Singapore as one of its founding members. From 1967 till now, Singapore-based companies have obtained US$1.35 billion in project funding. Amongst these, funding for 2,384 projects was disbursed to contractors and suppliers, while funding for 311 projects went to Singapore consulting firms. As of 31 December 2014, Singapore has contributed US$523 million to the Asian Development Bank in terms of capital subscription and funding, and, in turn, received US$1.35 billion worth of contracts. When Singapore first joined the Asian Development Bank, it was still a young and developing nation trying to find its feet. Now, Singapore has already achieved developed nation status; having accumulated even more practical operational experience, and cooperated in regional and international projects, local enterprises will be equipped with a competitive advantage.

Thus, we hope that the Ministry of Trade and Industry and the Ministry of Finance would learn from the experience of the Asian Development Bank and identify even more business opportunities in the international arena. In the area of infrastructural development, Government-linked companies are in the forefront and have a very credible track record. In bidding for AIIB projects, they have a higher success rate compared to small and medium enterprises (SMEs). We hope that Government-linked companies would also lead the way to open up opportunities for local SMEs with good credentials and with the high potential to participate in AIIB projects. Joining hands to compete for international projects and promote common growth would also increase national cohesion.

At a lunch dialogue organised by the Singapore Chinese Chamber of Commerce and Industry for trade association members, some member companies had raised similar concerns. They can see many business opportunities arising from regional infrastructural projects. But as the scale and size of the projects are rather large, they are probably beyond the reach of any single company. If there is Government support and if Government-linked companies are willing to take the lead, the success rate of local enterprises in bidding for the projects would be substantially higher.

Singapore's future is irrevocably linked to its value in the region and Asia. Asia is already the engine of growth in the global economy. China started AIIB to promote infrastructural development projects within the Asian region, including the One Belt One Road infrastructural projects initiated by the founding members of AIIB. From the business angle, AIIB and One Belt One Road are salient initiatives now as well as in the future, and businessmen are all looking forward to being a part of them.

Recently, some business owners have reflected their concern on the inadequate communication between the Government and the business community with regard to the ASEAN Economic Community. I hope that after the AIIB projects get off the ground, the Government could increase its communication with businesses; on the other hand,

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businesses should also make greater efforts to clinch the projects.

Mr Ong Teng Koon.

Mdm Speaker, I note with interest the Bill before the House today on Singapore's participation in the new AIIB. As Members know, the proposed AIIB is an initiative spearheaded by China to form an international development bank with a specific focus on financing infrastructure projects in the Asia Pacific.

I wish to first express my broad support for Singapore's engagement in this new multilateral project. In economic terms, AIIB is a timely venture. While the Asia Pacific has been growing tremendously over the last 20 years, there are still a lot of infrastructure investments needed in many parts of Asia.

The demand for such financing – both to develop basic infrastructure within countries, as well as to deepen linkages across countries in the region – remains massive. A recent Asian Development Bank report cited the need for up to $8 trillion of investment in infrastructure in Asia over the years 2010 through 2020. AIIB can help to fulfil this demand. Through our proposed participation, Singapore can play its role in fostering the development and integration, in raising living standards for millions of people as well as in promoting greater economic integration for Asia as a whole.

In this case, what is good for Asia as a whole will also be good for Singapore. If properly executed and coordinated, such investments in infrastructure would provide a boost to industrial productivity and, hence, economic growth in the region. Singapore also stands to benefit directly. From my own perspective in the financial sector, I know that investment banks or commercial banks cover Indo-China out of their Singapore offices. So, when demand for financial services grows in Indo-China, Singapore will benefit more than other competing financial hubs.

There is a second strategic reason that argues in favour of our participation in AIIB.

Amidst concerns about the geopolitical uncertainties that a newly assertive China may bring, it is important to recognise that closer economic integration in Asia will be pivotal for advancing and preserving political stability in the region. AIIB can be a platform that makes such closer, tighter economic integration possible. By bringing together key regional players as joint economic stakeholders, AIIB can bring into focus the common interest that all nations have in avoiding conflict and preserving regional peace. The goal of releasing the full

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economic potential of Asia can then take centre stage. To draw a parallel, the experience of our continual engagement with Myanmar over the long term provides an example of how the objective of economic development and cooperation can be a positive force towards fostering political stability.

The economic and political reasons I have highlighted are important enough that Singapore – despite our small size – should take an active interest in the AIIB initiative. I am, therefore, heartened by the fact that we were among the first countries to express our interest in being a founding member of the AIIB.

Yet, as many Members of this House will know, while the response to AIIB has been largely positive – with 57 countries, including the United Kingdom, Germany and Australia, signing on as founding members – the initiative has also been met with reservation, with the United States and Japan being notable by their absence. Why has this been the case? One natural concern is that AIIB will become a competitor to other international financial institutions, especially the Asian Development Bank. More importantly, there are also concerns that AIIB will come to be seen as a vehicle for advancing the national interests of its largest shareholders, specifically China.

It is, of course, much too early to pass such judgement on AIIB. But as a founding member with a seat at the table, I would urge that we be cognisant of such potential criticism and instead work towards ensuring that AIIB achieves its vision of becoming a modern and truly participatory international development bank. Our proposed commitment of $250 million will represent only a quarter of a percent of the total capital stock of $100 billion of AIIB. So, we will always look like small players in the big picture of things. But I would submit that there are, nevertheless, unique opportunities for Singapore to play a responsible role, even in these early stages, where the institutional structures of AIIB are being laid out.

Our expertise in nation-building can be useful in providing key inputs in the technical feasibility of proposed infrastructure projects that are put before AIIB for consideration. This is important not just from the perspective of cost-benefit analysis, but also for ensuring that infrastructure projects that are financed take the long view to be environmentally safe and sustainable and are not just pushed forward for the sake of quick growth at all costs.

Similarly, our credibility in forging clean and efficient institutions will be valuable and may give us a say in how the corporate governance structures of AIIB are formulated. Our hard-earned reputation as an honest broker on the international stage can also be leveraged, to help ensure that the portfolio of projects that AIIB finances will be truly diversified and representative and not be seen as advancing the narrow interests of one or two dominant

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shareholders.

These are early days, of course, in the formation of AIIB. But I would urge that the Ministry give thought to how our views and interests can be most effectively articulated as the founding member countries discuss the shape of this new institution. This is to ensure that the directions AIIB takes will, indeed, be to the broad benefit of all of Asia, while also being consistent with Singapore's own national interests.

In sum, I support our participation in the proposed AIIB. The ambition and scale of this project have the potential to promote economic development and closer trade ties across Asia for many years to come. Singapore and Singaporean companies need to be alive to the opportunities that this may bring. At the same time, our participation in this project sends an important signal of Singapore's willingness to be a constructive global citizen and is another step towards safeguarding our relevance as a small country that holds its own in the international arena.

As with any significant multilateral initiative, the devil will be in the details. There, I urge that due diligence and effort be exercised to ensure that the ultimate shape AIIB takes will be truly participatory and motivated by shared economic interests, and that AIIB will, indeed, mature to be an institution that is in its own stated aims, "lean, clean and green". With that, Mdm Speaker, I support the Bill.

Senior Minister of State Teo.

Mdm Speaker, let me, first, thank Mrs Lina Chiam, Mr Thomas Chua and Mr Ong Teng Koon for their support of the Bill. They have made good points which I agree with. As a small, open economy, Singapore's economic prospects are tied closely to those of the region and the world, and, in particular, infrastructure development plays a critical role in unlocking Asia's economic potential by strengthening the region's facilities and improving regional connectivity, all of which will benefit Singapore as a hub for trade and businesses.

International financial institutions like the World Bank, the Asian Development Bank and AIIB, complement the financial and knowledge resources of governments and the private sector. In particular, they bring a high level of expertise in project design and structuring, which individual governments may not have, particularly those that are still dealing with developing economies. By working with governments, these international institutions also help to reduce risks in large-scale infrastructure projects, help to make them

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bankable and draw in private sector financing. AIIB will better position Asia to meet its infrastructure and connectivity needs, thereby promoting greater regional integration.

As Mr Thomas Chua and Mr Ong Teng Koon have pointed out, Singapore-based companies and financial institutions stand to benefit from partnerships with AIIB and its member countries, especially given Singapore's expertise in infrastructure development as well as urban governance and planning.

Mr Thomas Chua also made a good point that Singapore companies, both Temasek-linked companies and SMEs, should work together to bid for projects at AIIB and other international financial institutions. The Government supports such partnerships. For example, we introduced the Partnerships for Capability Transformation initiative which promotes collaborative projects between large organisations and local SMEs to facilitate knowledge-transfer, capability-building and the co-creation of innovative solutions.

More importantly, we will continue to support our SMEs' internationalisation efforts to extend their reach and to build scale. To this end, in Budget 2015, the Government made several enhancements to the internationalisation programmes available to Singapore companies. For example, we raised the support level for SMEs under IE Singapore's grant schemes from 50% to 70% for three years. We also set up Clifford Capital to provide financing and catalyse more business opportunities for Singapore-based companies venturing into cross-border infrastructure projects. SMEs can tap on these initiatives as they look for project opportunities in the region and beyond.

Related to this, Mr Thomas Chua highlighted the need to improve communications between the Government and the business community on opportunities in the region. We agree with that.

The Government currently works with the World Bank and the Asian Development Bank to establish platforms that connect stakeholders involved in Asian infrastructure projects to share experiences and business opportunities in this sector. We will do the same with AIIB. For example, IE Singapore organises the Asia Singapore Infrastructure Round Table for Government officials and businesses to discuss the development and financing of specific infrastructure projects. Since its inauguration in 2013, the Round Table has attracted more than 600 industry practitioners with over US$6,000,000 worth of projects discussed.

Let me now move on to the point highlighted by Mr Ong Teng Koon, that despite our relatively small shareholding in AIIB, Singapore should play a constructive role in shaping AIIB to be an open, inclusive and modern institution.

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I agree with Mr Ong's views and, indeed, that is the stance that Singapore has been taking. From the onset, the Government has taken a proactive approach in shaping the development of AIIB by contributing our ideas and experiences. We have participated actively in the negotiations and worked with other prospective founding members to establish a strong governance structure and high operating standards for AIIB. Discussions on the bank's operational and financial policies are still underway and we will continue our efforts to ensure that AIIB is established as a well-respected institution of high standards that complements existing multilateral development banks. This is also a concern which Mrs Lina Chiam voiced. In fact, AIIB has the advantage of building on the experiences of the Asian Development Bank and the World Bank to establish itself as a strong institution.

Let me wrap up by addressing some of the concerns raised by Mrs Lina Chiam regarding immunities and privileges. On this point, I should remind Members and emphasise that while Singapore was one of the first countries to give its support as a founding member, there are, by now, 57 countries that have come on board AIIB. Fifty of these have already signed the articles of agreement. These countries include Australia and the United Kingdom. So, we are in good company and, in fact, in Singapore, we set a rather high bar for international organisations operating here and also it is not every day that a new international organisation like AIIB is set up. Take, for example, the World Bank was set up in 1944; the Asian Development Bank was set up in 1966. We are in 2015. So, the concern that we will suddenly be flooded with all these international organisations in Singapore, all enjoying privileges and immunities, is not a major concern at all.

In any case, I should point out that whatever privileges and immunities that we could grant to AIIB would not be more than what other international organisations, like the World Bank or Asian Development Bank, currently enjoy in Singapore. So, I would like to reassure Mrs Chiam on that point.

Mdm Speaker, on that note, let me now conclude. AIIB is an important addition to the international financial architecture and it is going to be a key international financial institution in our region. Joining AIIB is both a natural step as well as a critical move for Singapore as an international financial centre and business hub for the region. The AIIB Bill provides for Singapore to ratify the AIIB Articles of Agreement and to become a member of the Bank. Mdm Speaker, I beg to move.

[(proc text) Question put, and agreed to. (proc text)]

[(proc text) Bill accordingly read a Second time and committed to a Committee of the whole House. (proc text)]

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[(proc text) The House immediately resolved itself into a Committee on the Bill. – [Mrs Josephine Teo.] (proc text)]

[(proc text) Bill considered in Committee; reported without amendment; read a Third time and passed. (proc text)]

Order. I propose to take a break now. I suspend the Sitting and will take the Chair at 4.40 pm.

Sitting accordingly suspended

at 4.20 pm until 4.40 pm.

Sitting resumed at 4.40 pm

[Mdm Speaker in the Chair]

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[(proc text) Order for Second Reading read. (proc text)]

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

Madam, the Employment Act is Singapore's main employment law. It provides for the basic terms and working conditions for employees, while balancing employers' need to stay competitive. It is complemented by the Industrial Relations Act. Together with our tripartite partners, we regularly review our laws to keep pace with the changing labour force profile and employment landscape. We last amended the Employment Act in 2013 to extend protection to more workers. We also amended the Industrial Relations Act in 2014 to better meet the needs of our professionals, managers and executives (PMEs).

The Bill that I am presenting today is another instance of how the tripartite partners have worked together to enhance labour standards. It proposes amendments to the Employment Act in two key areas. First, we will be requiring employers to provide itemised payslips and key employment terms in writing to their employees. Second, the Ministry of Manpower (MOM) will be setting up an administrative penalty framework to make less severe breaches of the Employment Act non-criminal. Let me elaborate.

The first set of amendments proposes to give itemised payslips and key employment terms in writing to employees covered under the Employment Act. On the one hand, providing such documents will allow employees to better understand their regular salary components, as well as employment terms and benefits. On the other hand, this will help the employers to prevent misunderstandings and minimise disputes with their employees. Overall, this is better for employers and employees. We plan to make the new requirements for itemised payslips and key employment terms effective from 1 April 2016.

Madam, in coming up with these requirements, MOM actively consulted and took feedback from our tripartite partners. In particular, the Association of Small and Medium Enterprises (ASME) gave us practical feedback about the difficulties faced by small businesses in implementing these changes. We have, therefore, made adjustments to include flexibility for employers, but without compromising protection for workers. So, for example, employers will have flexibility to issue the payslips and key employment terms in either soft or hard copy, including handwritten copies.

For payslips, even if workers are paid weekly or fortnightly, employers will be allowed to consolidate payments into one monthly payslip. For key employment terms, common terms can be provided in the company's employee handbook or website, so long as the

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information is easily accessible to workers. In addition, key employment terms apply only to employees who work for at least 14 days continuously. This means that employers need not give key employment terms to casual workers who work only for a few days now and then.

These new requirements were made known publicly since 2014. We had deliberately given a two-year window till 2016 for employers to prepare for these changes. In the interim, we released a new set of Tripartite Guidelines on itemised payslips and key employment terms to help employers understand and implement the requirements.

We are also aware that small businesses need extra help. For example, some do not have the practice of issuing payslips and/or key employment terms. Or if they do, they may not include all the items required.

MOM has, therefore, been working with IDA and SPRING, as well as the tripartite partners, to help give smaller employers the tools to meet these new requirements. Over the past two years, we have provided an assistance package. This includes blank payslips that can be filled in by hand, free software, one-to-one hands-on assistance for SMEs, and funding support. We have received positive feedback from users on the assistance package.

Over the next few months, my Ministry will also be issuing more detailed guidelines, with sample payslips and key employment terms, to better help employers understand how to comply with these requirements. We will continue to work with our tripartite partners, industry and grassroots associations to conduct briefings and workshops to communicate these changes.

In view of the feedback from small businesses, we will give a one-year grace period in our enforcement. This means that from April 2016 to end-March 2017, MOM will take a light touch enforcement approach. Our focus will be on educating smaller employers on how to comply with the key employment terms and payslip requirements, rather than on punishing those who do not comply.

Madam, let me now move to the proposed administrative penalty framework, which will also come into effect from April 2016.

Today, all Employment Act breaches are considered criminal offences. These range from the failure to maintain employment records, which is mostly administrative, all the way to the more serious offences like non-payment of salaries which directly harm our workers. This is not proportionate.

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The proposed framework will allow MOM to treat less severe breaches as non-criminal infringements which attract an administrative penalty instead. For a start, four breaches will be covered under this administrative penalty framework.

First, failure to issue itemised payslips. Second, failure to issue key employment terms in writing. Third, failure to maintain detailed employment records. And lastly, provision of inaccurate information to the Commissioner for Labour or inspecting officers without the intent to defraud and mislead.

What this means is that employers who do not issue payslips or key employment terms may face a financial penalty, but there will be no criminal record. This process is more appropriate for these types of administrative breaches and prevents companies from being penalised too heavily, especially SMEs.

To do this, "authorised officers" with legal and investigative experience will be appointed. For a start, the administrative penalties they can impose will range from $100 to $200 per employee or occurrence, depending on the type of breach. The officers can also direct employers to rectify the breaches. Non-compliance with these directions will then become a criminal offence.

Madam, we are also taking the opportunity to make other operational amendments to the Employment Act.

For example, MOM's practice is to return to the owner evidence that is no longer needed for investigations. However, this is not possible sometimes because we cannot locate the owner; or the evidence is an illegal item, such as a forged document. We are amending the law to allow MOM to report such evidence to the Courts so that it can be disposed of properly.

The law also currently allows inspecting officers to take photos or video recordings if needed during investigations. We will amend the law to explicitly say that they can also take audio recordings. This is in line with the powers our enforcement officers have under other laws, such as the Employment of Foreign Manpower Act.

We will also make other technical amendments to clarify our long-standing policy intent and existing practice with respect to public holidays and all family-related leave during no-pay leave. Employers are required to pay their employees holiday rates of pay or give them a day off if they have to work on public holidays. We will make it clear that this includes all non-scheduled public holidays declared by the Government, such as the SG50 Public Holiday

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and polling days.

In addition, we will also make it clear that employers are not required to provide paid family-related leave to employees who are granted voluntary no-pay leave. This has been the practice in order to encourage employers to grant no-pay leave to employees to cater to their family or personal needs. The Child Development Co-Savings Act will also be clarified accordingly.

We propose that these amendments take effect as soon as possible after the passing of the Bill, as these are technical clarifications and nothing has changed for employers or employees.

Mdm Speaker, I would like to thank the public, the national and sectoral tripartite partners for their views and feedback that have made this review of the Employment Act more meaningful and robust. In particular, I would like to express my appreciation to the National Trade Union Congress (NTUC), Singapore National Employers Federation (SNEF), Singapore Business Federation (SBF) and ASME.

The proposed amendments will raise employment standards and facilitate dispute resolution at the workplace. They will also provide employers the flexibility to manage these changes in a practical manner. Taken as a whole, they will strengthen our efforts to institute good employment norms and develop progressive workplaces for our people. Madam, I beg to move.

[(proc text) Question proposed. (proc text)]

Mr Zainudin Nordin.

Mdm Speaker, I rise in support of the amendments to the Employment Act which I believe will be warmly welcomed by our workers.

The introduction of the compulsory itemised payslip and the key employment terms are good amendments. I have seen over the years of cases where workers do not even have proper contracts of employment, let alone know the terms under which they are employed. In these circumstances, when there is a dispute, the employers would not hesitate to read the terms to their own interpretation and advantage. The result: the workers are at the short end of the stick. They are left at the mercy and whims and fancy of unscrupulous employers,

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and worse if they are not unionised.

In this current day and age, I think it is simply unacceptable and poor excuse if SMEs claim that they are unable to provide a simple payslip itemising the breakdown of how they derive at the wages for the employees. Nevertheless, it is, indeed, good to see that there is a grace period for implementation so that there can be no further excuses. We should just help the SMEs which are genuinely unable to give such breakdowns and move forward. We must do more to protect all our workers in the Employment Act, more so, the vulnerable low-wage workers who are likely to be ill-informed and ignorant of their rights under existing laws.

Madam, while we are debating the amendments to the Employment Act, allow me to touch on the long-term challenges of our workforce. I believe we can do more in the future to amend the Employment Act, one of which is how we can narrow the income divide and help our lower-end wage earners. I believe this can only be done through innovative and inclusive policies. We have taken the steps forward with WIS and WTS which are good policies. What we need to do is to build on them and make further refinements.

In the long run, we must not forget that our Singapore workers are at the core of every company in every industry. As we progress and develop further our economy, Singaporean workers must be the ones to benefit and enjoy the fruits of their labour for their contributions and their perseverance in our economy. Hard work and continuous upgrading must be appropriately recognised and rewarded, with opportunities and accessibility to upward mobility and a good pay to match skills. Our PAP Government came into power championing the cause of the poor and the workers in the early days, and I am happy to see that we have not deviated from these efforts over the years.

Madam, employment and employability of Singaporean workers are very closely intertwined. Efforts to create jobs must be in tandem with the efforts to make Singaporean workers more relevant, more skilful to contribute to the growth of the industry.

The SkillsFuture strategy is, without doubt, the most important policy and strategy to transform the Singapore workforce. It is crucial to strike a balance in creating good paying jobs with the supply of able and skilled Singaporean workers to take up those jobs. This must be done in a harmonious tripartite working relationship between the employers, workers and the Government. That we have adhered to this platform, to me, has put our country in an advantageous position to exploit our harmonious tripartism.

Mdm Speaker, the society and industry must, over time, through education, awareness building, industrial norms and practices, recognise the value of deep skills and in-depth

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knowledge in every sector and industry. Workers with deep skills and expertise but who may not have formal or traditional paper qualifications must be properly recognised and remunerated. This change in mind set is what I believe will be the game changer of things to come for our workforce and workers. The efforts to promote skills upgrading and lifelong learning must have long-term impact on workers and our societal mindset in general.

Mdm Speaker, Singaporean workers look forward to the positive and upward outcomes in terms of their remuneration and the recognition of their hard work. As for our industry and the economy, it is imperative that we continue to produce skilled and abled employees to remain competitive and productive. More importantly, we must remain relevant to the world economy.

The change in our population demographics over the years must also be taken into account in looking at the overall picture of our Employment Act. Our workers are now more educated, healthier and live longer lives. We must look at how we can help these workers to stay longer in the workforce, so that they are not left out in our economic development. Our re-employment policies for seniors are commendable and we have moved the retirement age from 62 to 65. But look at the demographics again. And I think it is timely for us to move this age further, to maybe 67 or 68 before the seniors can decide to retire. The option will, of course, be for the workers to choose for themselves.

Maybe I can cite a few frivolous examples. Look at Mike Jagger, Paul McCartney, Tom Jones, Engelbert Humperdinck. They are all in their 70s. We still love them, and they are still rocking and rolling on stage.

The fact is that we have received feedback from able-bodied and capable senior workers who would like to continue to work. They are worried that they would just simply lose their jobs upon reaching the age of 65. They are still alert and full of energy. These are real concerns of Singaporean workers. We should look longer into our Employment Act amendments and see how we can further take into consideration some of this feedback and take care of our workers. Mdm Speaker, I support the amendments in the Bill.

Mrs Lina Chiam.

Mdm Speaker, over the years, we have encountered and read about workers being abused by bosses and employers, especially in the areas of salary arrears, unauthorised salary deductions and handling extra tasks which

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are not under the terms of their contract.

However, because of their status as salaried employees, they are unable to speak out against their errant bosses. Some do not wish to speak out because they are afraid of losing their jobs or their bosses might give them bad references for future potential employers should they find a new job.

Mdm Speaker, I am supportive of the purpose of this Bill which seeks to inject some provisions to protect Singaporean workers against common abuses brought about by their errant bosses. However, there are shortcomings that may affect the effectiveness of the proposed amendments to this Bill I and would like to propose the following.

Key employment terms. Under section 95A(2), an employer must give each employee a written record of the key employment terms of the employee not later than 14 days after the day that the employee starts employment with the employer. One potential issue relates to the 14-day timeframe. If an employee gets to see the key employment terms only after Day 13, after he has started his employment and finds it very unfavourable, he is being forced to accept such unfavourable conditions stipulated in the contract or to quit without a job.

Many employees holding on to current existing jobs would definitely prefer to read through the terms and conditions of their next job before they tender their resignation. What happens if they tender their resignation, only to be coerced to sign an unfavourable contract on Day 10 of their new workplace? Their former employers may have found another replacement and the worker may not be able to get their old job back. They will then be forced to accept whatever terms and conditions offered to them.

For example, if one were to view the terms and conditions only on Day 10 and found out that the job has a heavy monetary bond tied to it or has to work on weekends, should the job seeker just quit without a job or just bite the dust? Therefore, I would ask that this Bill remove the 14 days from section 95A and replace it with at least a two-week prior notice to allow workers to browse through their key employment terms.

The reason why a two-week prior notice is needed is that most employers require a two-week notice from their resigning employee so that there is some time to find a replacement for their new hire. In other cases, some employers even require a month's prior notification for tendering their resignation. This is a reasonable standpoint which is justifiable for both employee and employer.

Next, employers' obligation in relation to payslips. While this new section 96 is one step forward towards accountability, it may not be sufficient enough to stamp out abuses. Some

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employers use cashback "under-the-table" money to solicit money from their employees. A typical crafty boss would give out written itemised monthly payslips, but to punish employees for any mistake made in the line of work, the boss could, on the pretext, ask the employee to "donate" X number of dollars' fine to charity. At the end of the month, the employee would be coerced to donate quite a sum of money in cash for mistakes he has made. It is hard to report the boss' wrongdoings because of lack of evidence. MOM relies on written proof or some video recording on how these "donations" constitute unauthorised salary deduction to weed out these errant bosses.

Some professional, managers, executives and techniques (PMETs) quit without a job because of employers' abusive leadership and a toxic working environment. They are jobless not because their profession is a sunset industry but because they encountered errant employers.

I would propose that rather than give "wage subsidies" or ask them to go for retraining at e2i, MOM needs to take a proactive approach to intervene whenever PMETs go to them for help about work-related issues or unreasonable behaviour from their bosses before they are "forced" to quit without a job. Bad bosses should be shamed on Jobs Bank.

When salaried workers encounter errant abusive bosses, MOM could only mediate salary disputes because they are figures which are objective. MOM could do more to go beyond the Employment Act to be more assertive in weeding out bad bosses to build that bridge between employees and employers.

There are times when the allegations are borne from personal vendettas. But there are also genuine cases. How to determine?

Perhaps, we could follow the example of the Police. If a complaint lodged by that person turns out to be untrue or he or she wilfully tries to lodge a false report, the complainant can be charged for lying. This would deter complainants from lodging false reports with MOM, and MOM officers can have the powers to arrest and charge people for wilful lying or false declaration.