Singapore

HDB flats approaching end of lease (MND – COS)

If the Government does not have any specific plans for flats when their leases expire, I think it should make this clear to the public, so that buyers can factor this in when choosing a resale flat, and they don’t pay too high a premium for older flats.

This speech today was a follow up to a Parliamentary Question I asked in January, regarding the value of HDB flats at the end of their 99-year lease. I will post the Minister’s reply next week once it is out on the Hansard.

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Madam,

Government leaders have, over the years, frequently told Singaporeans that their HDB flats are an asset which they can monetise during retirement. However, less frequent are the reminders that, as a flat approaches the end of its 99-year lease, its asset value will depreciate to zero.

While most Singaporeans know that their flats are on a limited lease, many assume that HDB will not let their assets become worth nothing, or that their flats will eventually go through an “en bloc” before their leases expire.

The Minister told me in a reply to my PQ in January that the selection of sites and the pace of SERS (the Selective En Bloc Redevelopment Scheme) will depend on factors such as their redevelopment potential, and the availability of replacement sites for rehousing, and other resources.

Can the Minister confirm whether all old flats will eventually be replaced through SERS before they reach their end of lease? If not, what proportion will be not be replaced?

Other than SERS, what are the Government’s plans for HDB flats that approach their end-of-lease? For example, will their leases get topped up, and will the topping up cost be borne by HDB, or the lessees?

There are now over 31,000 flats which are more than 40 years into their lease. I’m sure many young couples are still buying these resale flats, which would mean that the leases may end within their lifetimes.

Trans-Pacific Partnership FTA (COS/MTI)

As a major trading nation, it is important for Singapore to be part of the TPP. However, I hope the Minister can assure us that the strategic and macroeconomic benefits of the TPP to businesses will not come at the expense of ordinary Singaporeans.

6 March 2014, Parliament

The Trans-Pacific Partnership (TPP) is an ambitious free trade agreement (FTA) involving 12 Asia-Pacific countries, including the US and Japan. Its scope goes beyond removing tariffs, to tackling broader environmental, labour and intellectual property (IP) rights issues.

The IP rights chapter in the TPP has raised much concern among the negotiating countries. The US’ proposals reportedly seek a much more stringent level of IP protection than WTO (World Trade Organisation) standards, or even the US-Singapore FTA. They are said to strongly favour American industries and big corporations.

There are worries that the TPP may extend the scope of pharmaceutical patents and delay the sale of generic drugs. These could raise prices of pharmaceuticals in TPP member countries, including Singapore.

Can I ask the Minister:

1. Will the TPP directly or indirectly cause an increase in the price of medical drugs in Singapore?

2. Will our patients have to wait longer to obtain affordable, life-saving generic medicines?

3. And what are the concrete steps our negotiators are taking to protect our national interests in this area?

Use of NSmen resources (COS/MINDEF)

For most NSmen, annual in-camp training (ICT) involves long hours away from work and family. There is often a lot of waiting time in between the action, hence the adage, “hurry up and wait!”

Speech in Parliament during the Committee of Supply debate for the Ministry of Defence on 5 March 2014.

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For most NSmen, annual in-camp training (ICT) involves long hours away from work and family. There is often a lot of waiting time in between the action, hence the adage, “hurry up and wait!”

Commanders, however, are much busier throughout the ICT because they are often engaged in planning while the men wait. Yet for the sake of equity, units usually issue call-ups to all involved NSmen for the full duration of the exercise. This incurs a huge cost in terms of the NSmen’s time and Make-up Pay – which is based on the NSmen’s civilian salary.

To better utilise NSmen resources, could non-commanders be recalled for a shorter ICT duration or fewer ICTs? To address the inequality, key appointment holders and commanders could be rewarded with extra pay or benefits to compensate them for the additional sacrifices they make for our nation.

Prudence in defence spending (COS/MINDEF)

In deciding on its expenditure and choosing cutting edge defence technology, does MINDEF consider that if we leap too far ahead, there is a risk of spurring an arms race, as countries in our region may feel under pressure to keep up with us? This could lead to even greater spending in the future, which may be unsustainable.

Speech in Parliament during the Committee of Supply debate for the Ministry of Defence on 5 March 2014.

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Each year, MINDEF takes up the largest share of the budget among all ministries. This year, the defence budget is $12.6 billion dollars — more than a fifth of total expenditure.

Singapore has the highest defence spending in South East Asia by far. According to the latest data from the Stockholm International Peace Institute (SIPRI), we spend 42% more than the next highest spender in the region, and 80% more than the third highest spender.

I fully appreciate the need for us to maintain a strong and credible defence force, and to remain ahead of potential adversaries.

However, in deciding on its expenditure and choosing cutting edge defence technology, does MINDEF consider that if we leap too far ahead, there is a risk of spurring an arms race, as countries in our region may feel under pressure to keep up with us? This could lead to even greater spending in the future, which may be unsustainable.

International development (COS/MFA)

Speech in Parliament during the Committee of Supply debate for the Ministry of Foreign Affairs.

International development is a form of foreign aid that seeks to improve the lives of people in developing countries, while at the same time furthering a country’s foreign policy goals.

It has not traditionally played a very visible role in our foreign relations strategies, apart from technical assistance programmes that we provide to developing countries. This is unlike most other developed countries that have dedicated international development agencies and sometimes even a cabinet minister in charge.

In 2013, Singapore contributed $26.7 million in overseas development assistance (or ODA), which includes technical assistance programmes, and scholarships and tuition grants to foreign students. Can the Minister share what other forms of ODA Singapore contributes that are not captured in this amount?

Many developed countries in the United Nations have committed to target an ODA contribution of 0.7% of gross national income (GNI). What is Singapore’s ODA as a percentage of GNI?

While I don’t expect Singapore to target 0.7%, are there plans to increase our ODA contribution in the future?

Does the Government see international development as a cost-effective way of furthering our foreign policy goals?

Given the multifaceted nature of international relations today, what is the role the Government sees international development playing in the years ahead?

Budget 2014 Speech

It is important to emphasise that the Pioneer Generation Package is not a “senior citizen’s package” even though all of our pioneers are now elderly. It should not be viewed as the fulfilment of the Government’s obligations to the elderly. There is still much that needs to be done for the elderly and future elderly in Singapore, especially people with disabilities, homemakers and low income workers who will have insufficient savings when they reach retirement age.

3 March 2014

Madam Speaker,

The Workers’ Party supports the Government’s initiatives to honour the pioneer generation of Singaporeans.

In August 2011, we released a National Day statement entitled, “Honouring our First Generation”. In our statement, we said:

“(T)he Workers’ Party wishes to pay a special tribute to the first generation of Singaporeans who struggled to build our nation during the early decades of independence. They are now our parents and grandparents, uncles and aunts; the elderly cleaners; the retired civil servants and teachers; the first National Servicemen.”

“This generation embodies the true Singapore spirit—the determination to work hard, overcome the odds and carve out a better life for their children. They serve as an shining example for many future generations to follow.”

“History may only remember the kings and not the soldiers, but let us never forget the contributions of the first generation of Singaporeans. More than anyone else, they deserve to enjoy the fruits of our nation’s success.”

“The men and women in our Pioneer Generation have borne society’s burdens … They gave the best years of their lives to our nation. Our nation must now give its best in return to them.”

I think this aptly describes our respect for and gratitude to the pioneer generation of Singaporeans.

PIONEER GENERATION PACKAGE

Madam, it is important that we honour our pioneers and do so before it is too late. Last year, over 13,000 people aged 65 and over departed from us, according to the Singapore Demographic Bulletin. Last week, I met a resident who said that his 80-plus year old neighbour was very happy to learn about the Pioneer Generation Package, but sadly he passed away suddenly the next week before enjoying any of the benefits.

The subsidies for specialist outpatient clinics and polyclinic services, as well as disability assistance, will be rolled out in September 2014, and all pioneers who do not already qualify can join the Community Health Assist Scheme (CHAS) only in January 2015. The MediShield Life subsidies will be applied at the end of 2015.

The Government should expedite the roll-out of the Pioneer Generation Package benefits. For example, since CHAS is already in place, can we allow all Pioneer Generation members to immediately benefit? Although MediShield Life will only be rolled out in end-2015, the Government should start applying MediShield premium subsidies for the Pioneer Generation from this year. The elderly above age 65 are already shouldering a heavy premium burden of between $540 and $1,190 per year for just MediShield Basic.

Alternatively, the Government could consider doubling the planned additional Medisave Top-ups for Pioneer Generation members until the Pioneer Generation Package is fully rolled out, so that pioneers can start to enjoy the benefits of this package sooner. This would provide 65-year olds an additional $400 in Medisave Top-ups this year and next year, instead of $200 in each year.

The DPM said that there would be panel to assess appeals from those who marginally missed out on the precise criteria. Could the DPM share what are the guidelines the panel will be given to make their assessments? I hope the panel will err on the side of generosity, as many of those who just missed out have made significant contributions on par with pioneers. In particular, I am of the view that all those who served in the first few batches – and not just the first batch – of National Service (NS) should qualify for this package because they played an important role at a critical juncture in our nationhood.

Madam, I would now like to touch on a few other aspects of Budget 2014.

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GST

First on GST (goods and services tax). For the past six years, GST has been the second-largest contributor to government revenue, after corporate income tax. In FY2013, its contribution of $9.52 billion exceeded that of personal income tax by almost $1.9 billion. In FY2014, GST’s proportion of revenue is expected to increase to 17%, up from 16.7% last year.

It is widely recognised, even by this Government, that GST is a regressive tax, because the poor fork out a higher proportion of their income to pay GST than the rich do. The permanent GST Voucher scheme is meant to correct this regressivity.

However, GST Vouchers fully offset the GST expenses for only retiree-led households and the very low income. For other lower-income households, on average the GST Vouchers offset only about half of the GST they pay each year. Therefore, many lower income earners are still net contributors to GST.

I note that Budget 2014 provides an additional, one-off GST Voucher in the form of cash for seniors and a U-Save Special Payment. However, these are only for this year, and they still do not fully offset the GST expenses for all lower income households.

Can the GST Voucher scheme be enhanced so that it fully offsets the GST expenses of all lower income households, and offsets a greater proportion of GST expenses for middle income households?

This will better ensure that the GST Voucher scheme fully corrects the regressive nature of GST and makes it more progressive.

PRODUCTIVITY-ENHANCEMENT SCHEMES

Next, on productivity enhancement schemes and their outcomes. Before I continue, I wish to declare that I work in the IT industry and in the SME sector.

I agree with the Government’s intent to raise productivity in our companies, increase technology adoption and reduce reliance on manpower.

In his 2010 budget statement, the Finance Minister said that the “key goal” of the Government was to grow productivity by 2 to 3% per year, or 30% cumulatively, over the next 10 years to 2020. He said this will allow Singapore to maintain an economic growth rate of 3-5% a year, even with slower growth in our work force. The DPM reiterated in this year’s budget statement that raising productivity is “at the centre” of the Government’s economic agenda.

How have we progressed so far in achieving this key national goal? In 2011, labour productivity growth was 2% over the year before. In 2012, it dropped by 2%. Last year, it was flat – there was no overall growth from the year before.

The DPM acknowledged that while productivity has increased by 11% since economic restructuring began four years ago, this was entirely due to the strong cyclical recovery in 2010, with little improvement since. At this rate, is the Government going to be able to meet the targeted 30% cumulative productivity growth by 2020?

In the last four years, hundreds of millions of taxpayer dollars have been transferred to businesses through various grants and tax credits for productivity-enhancing schemes. The schemes introduced in this year’s Budget are mostly enhancements or extensions of existing schemes. Given the disappointing overall productivity growth for the past 3 years, I think we need to examine these schemes to see what adjustments need to be made to produce more positive outcomes.

ICT FOR PRODUCTIVITY AND GROWTH

Budget 2014 will include a major effort to scale up the use of ICT (infocomm technologies) by SMEs. The DPM said the Government will give a stronger push to the piloting and scaling-up of ICT solutions that can help to transform whole sectors, through the ICT for Productivity and Growth (IPG) programme.

Under one of the initiatives in the IPG programme, the IDA (Infocomm Development Authority) will pre-qualify eligible vendors and their solutions. SMEs need not apply to IDA for the subsidy; they can approach the pre-qualified vendors, and IDA will reimburse the vendors directly. These apply only to sectoral solutions currently supported under IDA’s iSPRINT programme.

How will the Government ensure that IDA uses a fair and objective method, and that its officers have sufficient industry experience and competencies to select the right vendors and solutions? This is critical because SMEs will be limited to these vendors and solutions – for better or for worse – if they want to tap on the IPG fund. In this respect, wouldn’t it be more appropriate to allow SMEs to choose the best vendor and solution that meets their unique business needs, rather than restrict them to a pre-qualified list from the government?

Under the current iSprint scheme, SMEs need to wait for several months for grant approval from IDA, and I am told that IDA asks SMEs many questions before approving the grant. I presume this is to ensure that SMEs and vendors do not abuse the grants. There is also a lengthy business proposal that must be submitted to justify the funding. After evaluation, IDA may decide that the “qualifying costs” for the grant will be lower than the actual implementation cost of the system, hence lowering the overall grant disbursed.

As a result, many SMEs may find that it is not worth the time and effort to apply for such funding, and this will result in a lower adoption of productivity-enhancing technology in SMEs. Only 500 SMEs have benefited from funding for sector-specific proven solutions so far under the iSprint scheme, out of over 154,000 SMEs in Singapore. This stands in great contrast to the Productivity and Innovation Credit (PIC) scheme, which does not require such a lengthy and onerous application process to obtain funding. Is it no wonder that the PIC has proven to be much more popular with SMEs? Over 80,400s SMEs tapped on the PIC scheme in the last two years.

I hope agencies can adopt a more streamlined approach when evaluating and approving technology grants for productivity enhancement. This will be a key success factor for IDA if it is to reach its target of another 10,000 SMEs over the next three years.

If the concern is that some SMEs and IT vendors will abuse the grants, then audits could be conducted after project implementation and penalties could be put in place to deter such behaviour, rather than to weigh down all SMEs because of the actions of a few black sheep.

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Madam Speaker, I have more to say on other aspects of Budget 2014, including defence expenditure, the prudent use of NSmen resources, MediShield Life, healthcare financing, and helping more Singaporeans to enter work force. I will elaborate further on these during the COS (Committee of Supply) debate later this week and next week.

Value of HDB flats at end of 99-year lease

All HDB flats are sold to Singaporeans on a 99-year lease. We are technically not home owners, but lessees. I asked the Minister for National Development, during the 20 January 2014 Parliament sitting, what the value of HDB flats would be once their leases expire. I also asked whether the pace of SERS — the Selective En Bloc Redevelopment Scheme — will be fast enough to replace the flats reaching the end of their lease.

All HDB flats are sold to Singaporeans on a 99-year lease. We are technically not home owners, but lessees.

I asked the Minister for National Development, during the 20 January 2014 Parliament sitting, what the value of HDB flats would be once their leases expire. I also asked whether the pace of SERS — the Selective En Bloc Redevelopment Scheme — will be fast enough to replace the flats reaching the end of their lease.

The Minister confirmed that the value of the flats will be zero at the end of their 99-year lease. He also indicated that the selection of sites and pace of SERS depended on factors including the site’s redevelopment potential. Implicit in what he said was that SERS is not a scheme intended solely to replace old flats reaching the end of their lease.

He revealed that there are about 31,000 flats which are more than 40 years into their 99-year leases. This number will grow larger each year. It remains to be seen what the Government’s plans are for lessees whose flats approach the end of their lease.

The full transcript of the question and answer are below.

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Mr Gerald Giam Yean Song asked the Minister for National Development (a) how many HDB blocks are more than 40 years into their 99-year lease; (b) what will be the value of an HDB flat once it reaches the end of its 99-year lease; (c) what is the average number of flats undergoing redevelopment under the Selective En Bloc Redevelopment Scheme (SERS) each year for the past 10 years; and (d) whether the pace of SERS is fast enough to redevelop all HDB blocks before they reach the end of their lease.

Mr Khaw Boon Wan (The Minister for National Development): The Selective En bloc Redevelopment Scheme (SERS) is part of the Government’s estate renewal strategy for older estates. It allows intensification of land use and revitalises such estates through new developments. At the same time, it offers an opportunity for flat owners to buy a new replacement flat with a fresh 99 year lease.

In the last 10 years, SERS has benefitted the owners of about 18,000 flats. As the name suggests, the identification of suitable precincts for SERS is selective. The selection of sites and pace of SERS will depend on factors such as their redevelopment potential, and the availability of replacement sites for rehousing and other resources.

Currently, there are about 300 HDB blocks with 31,000 flats which are more than 40 years into their 99-year flat leases.

Like all leasehold properties, HDB flats will revert to HDB, the landowner, upon expiry of their leases. HDB will in turn surrender the land to the State.

[Source: Singapore Parliament Reports]

Investigation of suspected sexual assault cases

I asked the Minister for Home Affairs to outline what procedures the police have in place when investigating suspected sexual assault cases, including rape, to ensure that victims do not feel humiliated or faulted for what happened to them.

I asked the Minister for Home Affairs on 21 January 2014 to outline what procedures the police have in place when investigating suspected sexual assault cases, including rape, to ensure that victims do not feel humiliated or faulted for what happened to them.

I was very concerned after reading a report in the Straits Times on 8 December 2013 (“A rape victim speaks up”), in which a rape victim in Singapore recalled feeling humiliated when she identified her attacker from a photograph and a woman police officer remarked: “He’s handsome. Are you sure he is not your boyfriend and you willingly did it with him?”

After doing some reading up, I learned that it is important for the police to have in place standardised protocols for recording the rape victims’ statements and training in subjects like “common rape myths“, so that the officers do not inadvertently put the rape victims at risk of re-victimisation or secondary trauma.

Below is the transcript of my exchange with Second Minister for Home Affairs S. Iswaran in Parliament.

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Mr Gerald Giam Yean Song asked the Deputy Prime Minister and Minister for Home Affairs what are procedures that the police have in place when investigating suspected sexual assault cases, including rape, to ensure that victims do not feel humiliated or faulted for what happened to them.

Mr S Iswaran (for the Deputy Prime Minister and Minister for Home Affairs): Madam, victim care is a key aspect of the Police’s procedures for handling suspected sexual assault cases. It is provided with the aim of minimising further trauma to the victims, as well as to establish trust and rapport in order to facilitate the investigations. Let me highlight the key areas of victim care.

Firstly, our first response officers are trained to be empathetic and supportive when interviewing the victim, who may still be in a state of shock. They will take an initial account from the victim, in accordance with established case reporting guidelines.

Secondly, the cases are normally assigned to experienced police investigators, who are trained in sexual offence investigation techniques, and who have the requisite level of victim support and forensic awareness, to deal with the cases sensitively.

Thirdly, the victims are provided with a single point of contact and, throughout the investigation process, they deal with officers trained in victim care management.

Fourthly, Police have set up specialised facilities, such as separate consultation rooms, to provide personal space and privacy to the victims so that they feel at ease while providing critical information to Police in their investigations.

Fifthly, in certain cases where the victims require more specialised support, Police also works with relevant agencies, crisis support groups and medical social workers to provide information about the criminal justice process and additional victim care, such as professional counselling and aftercare services.

Mr Gerald Giam Yean Song (Non-Constituency Member): Madam, I thank the Minister for the reply. Research has shown that the police officers’ skill in recording rape complaints is important because it may affect the willingness of victims to cooperate with the authorities, the quality of the crime report that results and the degree of secondary trauma experienced by victims. Can the Minister clarify whether the Police have specific and standardised protocols for recording the rape victims’ statements?

The Minister mentioned that the Police have to undergone training. Does this training include subjects like common rape myths, so that they do not inadvertently put the rape victims at risk of re-victimisation?

Lastly, the Minister said that the Police will work with counsellors. Is there a standard protocol to refer the victims to counsellors at every instance or is it only on specific instances where the Police make a judgement?

Mr S Iswaran: Madam, first, there are clear protocols for investigation procedures and these will be adapted and customised to certain types of situations and crime, and that includes cases of sexual assault or alleged sexual assault cases

Second, one cannot expect our officers to be trained to be empathetic if they are given to – I think the Member used the term “common myths” – and, certainly, that is not the case. Our officers are trained to be empathetic and sensitive. But, also, to do their work, they need to establish the facts, so that has to be done. Sometimes, that may come across, for some individuals, as being a bit too forthright, but that is part of the investigation process. That is also why I enumerated in some detail the range of measures that are put in place at different levels in different ways to ensure that those who are allegedly victims are treated with empathy and sensitivity.

[Source: Singapore Parliament Reports]

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After note: The Association of Women for Action and Research (AWARE) has, in a letter to the Straits Times Forum on 26 January 2014, urged the authorities to stop using lie detector tests on victims of sexual crimes.

Criteria for registration of “political” websites

I sought clarity from the Senior Minister of State, asking if overseas subscriptions or advertising would constitute “foreign funding”. He could only say that “there will be issues of advertising” and that MDA is still in discussions with The Independent about it.

Question Time in Parliament on 20 January 2014 saw a debate about the criteria for registration of websites with the Media Development Authority (MDA). MP for Sembawang GRC Vikram Nair had asked the Minister for Communications and Information what are the factors which the MDA takes into account in deciding which websites are required to register under the Broadcasting (Class Licence) Notification.

In his reply, Senior Minister of State (Communications and Information) Lawrence Wong cited a “longstanding principle” that foreign entities are not allowed to engage in Singapore politics and that “foreign interests should also not be allowed to control or worse, to manipulate our local media platforms which are prime vehicles for influence”.

He revealed that the Government was trying to prevent websites like The Independent, which he said engage in the “propagation, promotion or discussion of political or religious issues” and are structured as corporate entities, from receiving foreign funding, including foreign investments.

I sought further clarity from the Senior Minister of State, asking if overseas subscriptions or advertising would constitute “foreign funding”. He could only say that “there will be issues of advertising” and that MDA is still in discussions with The Independent about it.

The relevant transcript of the Parliament debate is below. The full transcript can be found here.

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Mr Gerald Giam Yean Song (Non-Constituency Member): Madam, to follow up on the earlier question, will foreign funding include subscriptions from overseas as well as advertising from overseas? He mentioned that advertising restrictions do not apply for the traditional media because they are subject to other regulations. But would it apply to online media as well for both subscriptions and advertising?

Mr Lawrence Wong (for the Minister for Communications and Information): I understand the restrictions will apply more in terms of the actual receipt of funding by the corporate entity to run its business but there will be issues of advertising, because if you look at Internet advertising, it is growing. And then the question would be where do you get these sources of revenue from. So that is something that MDA has been in discussion with The Independent, particularly in sorting out some of the implementation issues. But the main concern with foreign funding would apply, firstly, to receipt of funding by the corporate entity itself to run its business which, I think, the undertaking by these entities would then address, because then they would undertake not to receive foreign funding. On advertising itself, I think that is something that we have to discuss the specifics, because it is more complicated in the Internet world where you may have difficulties in tracking the source of funding. But that is something that they are working through in discussion, the details, between MDA and The Independent.

[Source: Singapore Parliament Reports]

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My thoughts on this issue were articulated during my recent Supper Club interview with the Straits Times, I had said this in response to a question from the reporter asking what I made of the moves by the Government to tighten the regulatory framework for websites:

I think the Government seems to be concerned about the influence of a few popular websites that might be able to sway public opinion. That’s why they feel a need to hold these websites “accountable”, so that they are kept in line to a certain extent. I feel that these restrictions on online websites are not a very productive use of Government resources. I think there are so many other things that the Government should be paying attention to, rather than spending so much time and energy and money on just regulating a few websites. What really are they so fearful about? Why can’t they just let Singaporeans decide what they want to read? Especially when it comes to news, why can’t they let Singaporeans decide what is the right news to read, rather than try to regulate every single channel of news?

Public transport fare increases

Mr Gerald Giam Yean Song asked the Minister for Transport (a) what is the quantum of MRT and bus fare increases sought by each public transport operator in their latest submission; (b) whether the new fare subsidy schemes recommended by the Fare Review Mechanism Committee will be rolled out before any fare increases take place and all eligible commuters given ample time to apply for the subsidy schemes; and (c) how the Ministry will reach out to all commuters to ensure that they benefit from the subsidies they are eligible for.

This was a question that I asked the Minister for Transport during the 20 January 2014 sitting regarding the public transport fare increases that the public transport operators had sought. I had filed it before the announcement of the fare increases on 16 January. (Parliamentary questions have to be filed 7 working days before the sitting).

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Mr Gerald Giam Yean Song asked the Minister for Transport (a) what is the quantum of MRT and bus fare increases sought by each public transport operator in their latest submission; (b) whether the new fare subsidy schemes recommended by the Fare Review Mechanism Committee will be rolled out before any fare increases take place and all eligible commuters given ample time to apply for the subsidy schemes; and (c) how the Ministry will reach out to all commuters to ensure that they benefit from the subsidies they are eligible for.

Mr Lui Tuck Yew (The Minister for Transport):

The Public Transport Council (PTC) announced its decision on the 2013 fare adjustment last week. Although both public transport operators had applied for a fare increase of 6.6%, which is the combined fare cap for 2012 and 2013, the PTC approved an overall net fare increase of 3.2%, and rolled over the remaining 3.4% to the 2014 fare review exercise.

I would like to thank the Council for taking into consideration my earlier request during the November 2013 parliamentary sitting for the fare increase not to exceed the average national wage increase for 2013, which should come in at about 4-5%. The 3.2% fare increase is well below this, and hence public transport fares will continue to be affordable for the average commuter.

At the same time, the PTC decided to implement several enhancements to existing fare concession schemes as recommended by the Fare Review Mechanism Committee (FRMC). Up to half a million commuters stand to benefit. These include young children, students, in particular, polytechnic students, senior citizens and adult commuters who are heavy users of public transport.

The PTC decided that these enhancements will come into effect on the same day as the fare increase, that is, 6 April 2014.

On its part, the Government has decided to implement fare concession schemes for two groups of commuters who may be most impacted by the fare increase, that is lower-wage workers who are under MOM’s Workfare Income Supplement (WIS) Scheme, and persons with disabilities.

Eligible recipients will be notified around 6 April to apply for the two concession schemes, which will take effect from 6 July 2014. Transport vouchers will be provided to help them for the interim period between the fare increase on 6 April, and 6 July when the concessions take effect. These being new schemes, we need more time to set up the frameworks and processes, and to cater to potentially half a million applicants.

Let me assure the Member that my Ministry, the public transport operators and TransitLink will extensively publicise the enhanced and new concession schemes in the coming weeks, so that potential beneficiaries are made aware and can apply for and enjoy the concessions.

[Source: Singapore Parliament Reports]

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See also the Workers’ Party’s statement on 17 January 2014 in response to the announcement of the fare increases:

The Workers’ Party (WP) welcomes the new and enhanced concession schemes to make public transport more affordable for people with disabilities, senior citizens, low-wage workers, students and full-time national servicemen. These groups will finally enjoy some overdue relief for their travel needs, for which the public and the WP have lobbied for years.

The concessions, however, should not be used as a sweetener to make the latest fare increases palatable.

With an initial increase of 3.2% in 2014 and an increase of 3.4% rolled over to the fare review exercise next year, this could mean a heftier increase in 2015. We are concerned that the majority of the commuters may still experience a very large overall fare increase of up to 6.6% in the next two years.

This latest round of fare hikes comes on the back of a substantial $1.1 billion government subsidy in our public transportation system through the Bus Services Enhancement Fund (BSEF) last year.

The fare hike has also come despite train breakdowns having become a regular affair, further compounding the frustrations of commuters, who are frequently affected by such service quality and reliability lapses.

We are disappointed that the fare hike will take place three months before the concession schemes for low-wage workers and people with disabilities are to be implemented. We call for the fare hike to be delayed until the new concession schemes are implemented.

The WP believes that public transport should be provided as a public good and not for profit. Service quality, reliability and fare affordability should come before the need to ensure the profitability of PTOs.

DENNIS TAN LIP FONG (陈立峰)
Executive Council Member
The Workers’ Party