Parliament Highlights - 8 Apr 2013

Changes in pension, bonus plans for top civil servants

But review finds that current salaries are at right level, says DPM Teo

By Goh Chin Lian, The Straits Times, 9 Apr 2013

TOP civil servants will have two components of their salary changed on July 1 following a review, but will not have to face the pay cuts that were imposed on ministers' salaries last year.

Announcing the outcome of a comprehensive review on the salary framework of top civil servants in Parliament yesterday, Deputy Prime Minister Teo Chee Hean said the review found current salaries to be at the right level.

"There is no need to raise them or to cut them," he said in response to MP Baey Yam Keng (Tampines GRC), who had asked for an update on the review.

However, two structural changes to the salary will be made.

First, the pension system will be replaced with a long-term retention package for officers in the elite Administrative Service.

No further details were given of the package, but the change is in line with talent retention practices in the private sector and parts of the public sector.

Likewise, judges, the Attorney-General, the Auditor-General and the chairman of the Public Service Commission will have their pension schemes replaced by a gratuity plan.

Both the retention package - to retain officers for leadership and policy continuity - and the gratuity plan are "essentially of the same value" as the pension, Mr Teo said.

Second, their bonus will no longer be based on gross domestic product alone, but will be expanded to include indicators such as the socio-economic progress of middle- and lower-income Singaporeans.

This bonus, called the National Bonus, is the same as the one adopted by those holding political appointments last year.

Mr Teo added that some salary ranges and start points will be adjusted to smoothen out the progression.

He also stressed that the public service will keep paying competitive salaries, but these will lag behind - rather than lead - the market.

The changes are the result of a review by the Public Service Division (PSD) which coincided with the Government's decision in January last year to cut ministers' salaries.

The PSD had engaged Mercer, a global expert on remuneration issues, to conduct the review.

Yesterday, several MPs, including Mr Lim Biow Chuan (Mountbatten) and Ms Denise Phua (Moulmein-Kallang GRC), raised questions about the need for talent retention to go beyond money.

In response, Mr Teo stressed: "The most important motivation for a person to stay in the public service is that he gets happiness out of other people's happiness."

He gave his assurances to Mr Zaqy Mohamad (Chua Chu Kang GRC) that competitive pay did not have to mean these civil servants were disconnected from the ground, as there are avenues for them to stay in touch, like the Our Singapore Conversation and community attachments.

Kelly Services Singapore vice-president Mark Hall said that in replacing pensions with retention packages, the Government is following the course of many private sector firms while still giving staff a financial incentive to stay on.

Curbs on car loans depend on market conditions

Lawrence Wong: More time needed to see impact of recent restrictions

By Royston Sim, The Straits Times, 9 Apr 2013

ANY change to the recent curbs on car loans will hinge on whether there is "sustained moderation" in certificate of entitlement (COE) prices, said Acting Minister for Culture, Community and Youth Lawrence Wong.

He noted that the impact of the loan restrictions can be determined only over a period of time, and there is just a month's worth of data available since the restrictions were put in place on Feb 26.

Mr Wong, a board member of the Monetary Authority of Singapore (MAS), was speaking in Parliament yesterday on behalf of Deputy Prime Minister Tharman Shanmugaratnam. He was replying to Mr Lim Biow Chuan (Mountbatten) and Nominated MP Teo Siong Seng, who asked about the effect of the curbs and whether they could be eased.

He said: "We will recalibrate our financing restrictions for all cars new and old in response to market conditions, in particular if there is a sustained moderation in COE prices."

The MAS' recent curbs limited car loans to 50 or 60 per cent of the purchase price, and capped the loan tenure to five years.

Previously, car buyers could borrow the full amount and stretch the loan up to 10 years.

Mr Wong said it was necessary to set "significant" limits to moderate the demand for cars. The curbs are also to encourage financial prudence, he added.

Mr Lim noted that the feedback so far is that the curbs have benefited those who are better off, while putting younger citizens who may need a higher loan at a disadvantage. In response, Mr Wong said the curbs are tiered so those who buy smaller cars have a higher loan limit of 60 per cent.

On providing relief to ailing used-car traders, Mr Wong said the authorities had worked out a "reasonable window" to help dealers. Last week, the MAS announced that it would lift loan restrictions on 7,000 used cars for 60 days. These cars were in stock or acquired before Feb 25, when the curbs were announced.

Mr Wong said about 6,000 used cars were sold each month on average in the past.

In the month after the curbs took effect, 5,000 used cars were sold, of which 4,000 were registered before Feb 25.

Prices have also gone down by about 10 per cent. Based on this data, dealers should be able to sell off most of their stock, he said.

He added that the Government will not be extending this 60-day window for used-car dealers.

Ms Foo Mee Har (West Coast GRC) expressed concern that buyers who are less cash-rich could resort to taking up personal loans from banks or moneylenders to finance car purchases. She noted that personal loans have interest rates that are six to 12 times higher than car loan rates.

Mr Wong said the authorities have not seen any signs of this happening, but will continue monitoring the situation.

S'pore cooperates readily with other countries to fight financial crime: Tharman
Channel NewsAsia, 8 Apr 2013

Deputy Prime Minister and Finance Minister Mr Tharman Shanmugaratnam said Singapore cooperates readily with foreign jurisdictions to fight financial crime. He added that Singapore's cooperation is guided by international standards and norms.

This was the written response by Mr Tharman to the parliamentary question raised by Mr Png Eng Huat, MP for Hougang SMC.

Mr Png had asked how many times have Malaysia and Indonesia approached Singapore to provide information on their citizens who operate bank accounts out of Singapore, for tax or investigation purposes in the past 10 years.

The Finance Minister said that under Singapore's anti-money laundering regime, financial institutions are required to be vigilant against suspected illicit monies. They have to know their customers, and to report any suspicious transactions in customers' accounts.

Singapore also stands ready to assist foreign authorities investigate possible criminal activity, including the exchange of bank account information.

Mr Tharman said this is provided under the Mutual Assistance in Criminal Matters Act.

"Through our bilateral tax agreements, we also exchange information actively with Malaysia and Indonesia for tax investigations," said Mr Tharman.

However, Mr Tharman said that "it is generally not the international practice among authorities to reveal the number of legal assistance and information requests from specific countries."

He added that Singapore has "helped fully on all requests from Malaysia and Indonesia in accordance with our current tax agreements. This includes information on details of transactions and companies."

Mr Tharman said that Singapore has offered Malaysia and Indonesia the opportunity to update their tax agreements with the internationally-agreed standard for exchange of information for tax purposes. The standard provides for the exchange of bank information.

"Once our tax agreements with Malaysia and Indonesia are updated with the standard, just as for our tax agreements with other countries, we can build further on our good working relations with Malaysia and Indonesia and enhance tax cooperation further," added Mr Tharman. 

Steps to ensure transparency in home sales
Stiff penalties for developers who fudge prices or mislead flat buyers on space
By Elgin Toh, The Straits Times, 9 Apr 2013

PRIVATE home buyers will get better protection against unscrupulous developers with new stiffer laws to ensure "what you see is what you get", in terms of actual prices and the appearance of homes.

When reporting prices, developers must now reveal all discounts, including furniture vouchers and stamp duty reimbursements. This ensures transacted prices for new projects are not artificially inflated - a practice that misleads prospective buyers.

Also, showflats can no longer be made to look more spacious than the finished product, such as through the use of higher ceilings or glass panels in place of brick walls.

These were among the amendments to the Housing Developers (Control and Licensing) Act, approved by Parliament yesterday.

In moving the Bill, Senior Minister of State for National Development Lee Yi Shyan said it was necessary to safeguard home buyers' interests and enhance the professionalism of the industry.

"A home is, in most cases, the single largest investment in one's lifetime. It is only right that home buyers are provided with the appropriate tools and legal safeguards to make informed decisions," he added.

The latest move follows regulatory updates by the Government last year requiring developers to provide home buyers with more information, including drawn-to-scale location plans.

The new laws allow for greater punitive and enforcement measures against errant developers.

The Government will be able to inspect a showflat and close it if it does not pass muster. It will also have the flexibility to regulate dubious sales and marketing practices, such as the collection of blank cheques from prospective buyers.

The maximum penalty for flouting the law has been raised. Developers can be fined $100,000 - up from $20,000 - and can now be jailed for up to three years.

The Bill also bars anyone convicted of fraud or dishonesty from becoming a director, manager or secretary in a housing developer for five years.

Members of Parliament who spoke on the Bill yesterday voiced strong support for it and urged the Government to rein in unscrupulous developers.

Many retold stories from residents who had unhappy experiences buying condos - from brochures promising non-existent "lush greenery" and an "unobstructed view" that turned out to be obstructed, to the use of fake buyers queueing to create hype.

Mr Lim Biow Chuan (Mountbatten) asked if the margin of error developers were allowed to have on property area could be reduced from 3 to 1 per cent. Mr Lee said there were currently not many complaints on this, but added it would be considered if there were technological advancements.

Nominated MP Eugene Tan said the $100,000 fine still paled in comparison to the profits developers stood to reap. Mr Lee replied that deterrence was "sufficiently strong", given the other measures - including jail and the suspension of sales until the project is completed, which would constrict revenue flows.

At least one developer applauded the changes yesterday. Said EL Development's managing director Lim Yew Soon: "When the rules on showflats were grey, some developers got very 'creative', and careful and honest developers like us suffered, unfairly, because our showflats looked smaller."

New Bill lets MAS regulate FHCs
By Alvin Foo, The Straits Times, 9 Apr 2013

THE Monetary Authority of Singapore (MAS) can now strengthen its oversight of financial holding companies (FHCs), after Parliament yesterday approved a Bill that provides a regulatory framework for such entities.

An FHC is a non-operating holding company which is incorporated here and operates a Singapore bank or insurance subsidiary here, or both.

Deputy Prime Minister Tharman Shanmugaratnam, who is the minister in charge of MAS, said: "It is common for internationally active financial groups to be organised under holding companies... The Bill will clarify and ensure appropriate MAS prudential oversight of financial groups in Singapore."

He made the point yesterday at the second reading speech of the Financial Holding Companies Bill, which was passed by Parliament.

Mr Tharman told the House that group-wide supervision allows MAS to assess the impact that a financial institution's relationships with other entities in the group may have on its safety and soundness. He added: "It is aimed at mitigating intra-group contagion risks, preventing the multiple use of capital within the group and limiting concentration risks at the group level."

Countries such as Australia, Canada and the United States have already established legal frameworks for FHCs, he noted.

Not all FHCs here will be regulated by the MAS.

The MAS will follow a set of criteria to assess whether an FHC should be designated for regulation. For instance, MAS will regulate an FHC if it is the ultimate parent of a financial group with a bank or insurance subsidiary here.

Nominated MPs Tan Su Shan and Eugene Tan spoke in support of the Bill. Ms Tan, who is a banker, said it will enhance Singapore's value proposition as a premier international financial centre. Mr Tan said: "It is a timely piece of legislation to support the growth, integrity and robustness of our financial sector."

He asked Mr Tharman for the number of FHCs which are likely to fall within jurisdiction of the proposed law. Mr Tharman said that there are currently five FHCs that meet the criteria to be designated for regulation. According to the MAS, they are DBS Group Holdings, Great Eastern Holdings, ACR Capital Holdings, Citystate Capital Asia and Whittington Group. MAS will formulate the detailed regulations to bring into operation the FHC Bill, he added.

Pay rises may not mean higher inflation: Iswaran
The Straits Times, 9 Apr 2013

PAY rises may not necessarily lead to long-term inflation, as much depends on whether they are backed by productivity gains, Second Minister for Trade and Industry S. Iswaran said yesterday.

He was replying to Nominated MP Tan Su Shan, who wanted to know if long-term structural policies such as a tight labour market could lead to structural inflation.

"I want to emphasise that it's not axiomatic that just because wages increase, that prices must go up and inflation must be a consequence," said Mr Iswaran.

"Because the key elements here are whether... those wage increases are underpinned by productivity and other enhancements in the economy."

This is why a key part of the Government's strategy is to boost productivity, he said.

Earlier, Ms Tan had asked if inflation in Singapore would slow.

Mr Iswaran noted that inflation in the first two months of this year averaged 4.2 per cent, down from last year's 4.6 per cent.

The growth of housing rental prices has slowed and certificate of entitlement premiums have moderated, he said. Imported inflation is also expected to be "benign" this year, with lower food price inflation and falling prices of oil-related items.

As for services, the tight labour market could raise wage costs "in the transitional period", thus putting upward pressure on prices.

But as the Government is helping firms defray the cost of pay rises, this passing-on of costs will be dampened, said Mr Iswaran.

"In the longer term, with productivity gains, firms will be able to afford higher wage costs and cope with higher business costs, without having to pass on the increased costs to consumers."

The MTI and the Monetary Authority of Singapore (MAS) expect inflation for the year to be 3.5 per cent to 4.5 per cent.

This forecast will be reviewed in the MAS' Monetary Policy Statement on Friday.

Ideas still aplenty for Baby Package
MPs seek more incentives in new Bill
By Goh Chin Lian, The Straits Times, 9 Apr 2013

THREE months after the Government announced a raft of measures to nudge Singaporeans to have babies, MPs still had suggestions yesterday on how to do better.

They were not short of ideas.

These range from Dr Intan Azura Mokhtar's (Ang Mo Kio GRC) suggestion to extend maternity leave beyond 16 weeks for the third and subsequent child, to Ms Low Yen Ling's (Chua Chu Kang GRC) call on the Government to give small and medium-sized enterprises grants to provide facilities at their workplaces for breastfeeding mums.

Both mothers, along with five other backbenchers, made their arguments during the debate on the Child Development Co-Savings (Amendment) Bill.

The Bill, which was passed by Parliament yesterday, seeks to put into effect improved maternity benefits and parental leave schemes that were introduced earlier this year.

Acting Minister for Social and Family Development Chan Chun Sing stressed that while the Government and society play a part in providing a pro-baby environment, the choice to start a family is still a personal one based on individual priorities and values.

He also made it clear that the incentives were never meant to suggest that babies were economic digits: "We want Singaporeans to have happy families because this is part and parcel of having a meaningful life in Singapore, beyond having a meaningful career.

"It saddens me when people take out a balance sheet to try and calculate all the pluses and minuses financially, numerically, before they decide to make that leap of faith."

Mr Chan also addressed calls by Nominated MP Eugene Tan for heavier penalties for employers who discriminate against pregnant employees, and by Nominated MP R. Dhinakaran to penalise employees who give misleading information. Mr Dhinakaran also asked for a whistle-blowing mechanism for workers to tell on errant bosses or lying colleagues.

Mr Chan said the policy already balances the interests of employers and employees.

Errant employers can be fined up to $10,000 and jailed for up to one year. The law also provides for employers to recover payment from an employee who gave misleading information.

A complaint of malpractice can be made to the Manpower Ministry, and all information will be kept confidential, he added.

On Dr Intan's suggestion to extend maternity leave, Minister in the Prime Minister's Office Grace Fu cited public feedback and said some favoured it.

But many women feared they would, among other things, lose touch with their work. There may also be an impact on employers' business costs, Ms Fu added.

She noted that globally, Singapore's 16-week paid maternity leave is "quite generous", compared to South Korea's 15 weeks, Japan's 14 weeks, Hong Kong's 10 weeks and Taiwan's eight weeks.

Parenthood package 'not financial aid for the poor'
By Tracy Quek, The Straits Times, 9 Apr 2013

THE main aim of the marriage and parenthood package is not to provide financial assistance for low-income families, but to help Singaporeans marry and have children, said Ms Grace Fu yesterday.

While low-income families deserve greater help, giving them more assistance under the $2 billion-a-year package designed to make Singapore more family friendly may "inadvertently send a message that is incongruent with our emphasis on being self-reliant", she added.

The Minister in the Prime Minister's Office was speaking during the debate on the Child Development Co-Savings Bill.

During the debate, Nominated MP Laurence Lien voiced concern over what he saw as discrimination against needy children in terms of various schemes and policies.

He cited the example of the co-savings component of the Baby Bonus scheme which he said favours higher-income families who are in a better position to save to receive the matching grant.

In response, Ms Fu pointed to a range of social assistance programmes such as income support, housing, education and health care to help lower-income households.

Apart from low-income families, several backbenchers also wanted more help for those in non-traditional family arrangements, in particular single parents, unwed mothers and those wishing to adopt.

Nominated MP Eugene Tan and Workers' Party Non-Constituency MP Gerald Giam called for unwed mothers to receive the same parenthood benefits afforded to married parents, such as 16 weeks of paid maternity leave.

For some unmarried expectant mothers, Mr Giam said, these benefits may "tip the scales in favour of keeping the child" instead of an abortion.

Responding, Ms Fu said while the Government understands that single unwed parents are more often than not "victims of circumstances", the community at large "does not appear ready to accept single-parent families as the norm".

"The Government believes that a stable, intact family structure provides a more conducive environment to raise a child," she said, adding that this belief is reflected in the marriage and parenthood package.

Also addressing the MPs' concerns, Acting Minister for Social and Family Development Chan Chun Sing assured them that no child is discriminated against.

Mr Chan, who was raised by a single mother, said he spoke from personal experience when he said the best thing the Government can do to help children from vulnerable families is to provide them with good education and health care.

The Government wants to do more to help these families.

He said: "In the coming year, we are looking forward to developing new measures to help vulnerable families."

Several MPs also raised the issue of adoption leave.

NMP Eugene Tan, for one, questioned whether the four weeks of paid adoption leave introduced in the Bill was enough time for bonding.

Could the different leave entitlements for natural and adoptive parents send a signal that an adopted child is valued less or that adoption is not encouraged, he asked.

Mr Chan said the Government will monitor and assess whether the four weeks of leave meet the needs of adoptive parents. Adjustments can be made in future, he added.

Better doctor and nurse ratios
By Andrea Ong, The Straits Times, 9 Apr 2013

THE proportion of doctors and nurses serving the general population has improved in the past five years.

Giving the ratios yesterday, Minister of State for Health Amy Khor said Singapore had one doctor serving 520 people last year, an improvement from 620 people in 2007.

Similarly, there was one nurse for 154 people, compared with 205 people in 2007.

She also said in her reply to Mr Gan Thiam Poh (Pasir Ris-Punggol GRC) that the pool of professionals working in public health care has gone up to help meet the needs of Singapore's growing and ageing population.

For instance, the number of doctors has risen by more than 50 per cent since 2007, to reach 6,200 last year.

At the same time, the number of nurses has shot up by about 70 per cent, to 21,000.

Dr Khor said the doctor-to-population and nurse-to-population ratios are comparable with those in developed regional economies such as South Korea, Hong Kong and Taiwan which have similar proportions of elderly people.

The ratios are likely to remain "broadly comparable internationally" even as Singapore's population ages, because the Government expects to expand its pool of health-care professionals by another 20,000 over the next seven years, she added.

Mr Gan also asked if the current health-care workforce is sufficient in the event of a pandemic, such as the severe acute respiratory syndrome (Sars) or bird flu.

His question comes amid the appearance of the deadly new H7N9 bird flu strain in China.

Dr Khor said Singapore has learnt from past outbreaks of Sars, the H1N1 flu and dengue, and has measures in place to deal with a surge in cases.

For instance, if a pandemic occurs, public health-care institutions will cut back on elective surgery, outsource services where possible, bring back temporary health-care support staff and redeploy manpower across the health- care system.

Response plans for gas leaks, chemical spills in buildings
By Jalelah Abu Baker, The Straits Times, 9 Apr 2013

BUILDING owners are required to boost their emergency plans to include measures for fire-related incidents such as gas leaks and chemical spills, under a law passed in Parliament yesterday.

Stiffer penalties will also be imposed on those who make changes to their buildings or workplaces without a permit from the Singapore Civil Defence Force (SCDF), or fail to supervise such fire safety works.

The existing $50,000 fine is quadrupled to $200,000 while the jail term is doubled to two years.

One such offence highlighted in Parliament was at the multi-storey carpark in People's Park Centre. It was illegally partitioned, impeding ventilation during a fire in April 2010.

The new law also gives added responsibilities to a fire safety manager, who will have to ensure the firm complies with SCDF's guidelines and forms its Company Emergency Response Teams (Certs).

"Time is of the essence in an emergency and the Cert provides a first line of defence in mitigating incidents," said Senior Minister of State for Home Affairs Masagos Zulkifli yesterday when setting out the amendments to the Fire Safety Act for debate.

He cited how ExxonMobil's Cert team swiftly put out a fire at one of its pumps on Jurong Island in April 2011. The team did it in five minutes and before the arrival of the SCDF.

These moves to raise fire safety standards follow a review that took into account changes in Singapore's industrial structures as well as lessons and experiences from major incidents in Singapore and overseas.

But is too much responsibility being placed on fire safety managers, who are likely to be mid-level employees, asked Ms Sylvia Lim (Aljunied GRC).

Mr Masagos replied: "When a fire hazard abatement notice is served, it is served on the owners.

"But the fire safety manager must ensure and help us to make sure the plans for the abatement measures are up-to-date and that the Cert is operational and ready."

He also said, in reply to Mr Arthur Fong (West Coast GRC), that three training courses will be introduced for Certs. Companies will get a six-month grace period to put in place their emergency response plans and two years to form Certs, he added.

SCDF has also been given powers for marine fire-fighting and rescue, including probing fires on board vessels at sea, regardless of their country of registration.

Stiffer labour policy: HDB less affected

THE Housing Board will likely be less affected by the tighter foreign worker policy than other developers, Minister for National Development Khaw Boon Wan said yesterday.

The reason: It relies extensively on prefabrication which raises productivity and reduces labour needs.

He was replying to Ms Foo Mee Har (West Coast GRC) and Ms Lee Bee Wah (Nee Soon GRC), who asked about the impact of stiffer foreign worker rules on the building of new flats.

The man-year entitlement, or quota of foreign workers allocated for each construction project, will be cut by 15 per cent in July, bringing the total cut since 2010 to 45 per cent.

Levies for hiring foreign workers will also be raised in the next two years.

Mr Khaw said HDB may allow contractors who cannot cope to transfer their contracts. It may also terminate non-performing contractors.

"Regardless of which option is adopted, delivering flats to Singaporeans on time remains our top priority."

He said the HDB has yet to close any tenders since the higher levies were announced. If tender costs rise, the government subsidy will increase to absorb it, he added.

82 accidents at crossings a year

ON AVERAGE, there were 82 accidents a year involving pedestrians or cyclists hit by vehicles at pedestrian crossings over the past five years.

Responding to Ms Irene Ng (Tampines GRC), Second Minister for Home Affairs S. Iswaran said such accidents make up about 1 per cent of all accidents each year.

On average, three pedestrians and a cyclist were killed in such accidents a year, and about 55 pedestrians and 21 cyclists injured.

Since 2008, the number of pedestrian and cyclist casualties at pedestrian crossings has dropped by 63 per cent.

MOH reviewing abortion counselling

THE Ministry of Health is reviewing the criteria under which women who wish to have an abortion must receive counselling.

In a written reply, Health Minister Gan Kim Yong said the ministry began its review last month and "will consult the public in due course".

Non-Constituency MP Gerald Giam had asked why pre-abortion counselling is not mandatory for women who have not passed the Primary School Leaving Examination, have three or more children, or are foreigners.

Mr Gan also revealed that the number of abortions by Singaporeans fell from 9,763 in 2003 to 6,431 last year, while those by PRs rose from 858 to 1,382, and by foreigners, from 1,651 to 2,811, in the same period.

BTO flat prices stabilised: Khaw

THE prices of build-to-order (BTO) flats have stabilised, said Minister for National Development Khaw Boon Wan yesterday.

He gave the prices in three HDB towns to show how they have settled since being de-linked from the resale market in 2011. "By and large, we have kept the BTO prices steady even though resale prices have risen. And we will continue to do so until the market stabilises," he said.

The figures were sought by Workers' Party MP Png Eng Huat (Hougang). He had asked for the average BTO price ranges for three-, four- and five-room flats in mature and non-mature estates a year before and after the delinking.


Related

Written reply to Parliamentary Question on the breakdown of foreign spouses of Singapore Citizens by immigration status and gender