Committee of Supply − Head T (Ministry of National Development)

Providing Housing with Compassion

Er Dr Lee Bee Wah (Nee Soon): Sir, I beg to move,

That the total sum to be allocated for Head T of the Estimates be reduced by $100.

It is often said that a society can only truly progress if its people practise compassion and humanity. Good infrastructure, economic growth and deployment of advanced technologies lay the foundations to a prosperous and stable nation. But in the long term, the benefits of material success are limited. Human wisdom is essential in building a peaceful nation that encourages its people to pursue happiness.

"The strength of a nation derives from the integrity of the home", says Confucius. Indeed, home is the core of the heart and nation, for it is where we derive security and love. Only when one feels happy and confident about his future, can he spread these feelings of goodwill to his fellow citizens.

[ Mr Deputy Speaker (Mr Seah Kian Peng) in the Chair]

A comfortable and safe home lays the groundwork for a healthy and stable family. Through the provision of affordable homes and humane housing policies, the Ministry of National Development can play a significant role in helping the people to achieve this. The recent policies and measures that were put in place, such as the construction of more Build-To-Order (BTO) flats and the increase of income ceilings, have clearly taken effect, as fewer first-time flat applicants are coming to see me in my Meet-the-People Sessions. I commend the Minister for executing bold measures in such a short period of time to help young couples to afford their dream homes.

I am sure our ever compassionate Minister is looking into ways to help more people. First group who came to my mind are the divorcees with children in tow. Just last week, I saw a resident and she is a divorcee who has the custody of three children and she wanted to buy a flat from HDB. She received a letter from HDB asking her to get a letter from her ex-husband to confirm that he will not buy a flat in the next five years with any of his children. My first response was, “真的吗?” Why make her life so difficult in order to buy a flat from HDB. And these are the not so fortunate people who are trying to make the most out of life in spite of their disadvantages. By extending a roof over them will give them a lot of warmth and love, as in the Chinese saying, 雪中送炭, that is, help them when they are most in need of help. In this case, a HDB flat. Let us provide housing with compassion.

In an ageing society, where filial piety is losing its prominence, singles who care for their elderly parents are exemplary models for the future generations. They should be made to feel supported and their efforts worthwhile. Filial piety is one of the fundamentals of morality and a safety net to the ageing population problem. We need to get this message across to the young that they have a responsibility to take care of their aged parents. It is imperative for us to make a stand on how we as a society value filial piety.

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We need to create the opportunities where the children can build an emotional affinity with their parents. On its part, the Government should help to make it easier and more affordable for the children to care for their parents. One of the ways to do this is to allow singles to purchase BTO flats if they are caring for their elderly parents. I came across residents who, after caring for their parents for so many years and when their parents passed away, they have no place to stay. Another would be to increase the possibilities for children to live near their parents, by building more flats in mature estates and give them priority to these flats. I would also like to suggest to let those elderly who choose to downgrade under the newly introduced Silver Housing Bonus be given the priority to choose a flat near their children. This will make the scheme more attractive. They can help to look after each other, for example, grandparents can help to look after grandchildren when the parents are at work. And this will help in the procreation that we have been talking about.

As economic prospects look less positive this year, the percentage of the population struggling to juggle homeownership and other necessary expenditures is likely to increase. Downsizing a flat or downgrading from private property to an HDB flat seems like obvious solutions. Yet HDB has a policy that debars ex-private property owners to own an HDB flat within 30 months from the date of sale of his private property. In addition, the owners of subsidised HDB flats also face a similar debarment.

Some people downgrade their homes because they have trouble paying off the housing loan for one reason or other. Some do not derive profit from a sale after paying off the loans because they had bought the property at a high. The fact that banks refuse loans to some of these people proves that they need help. I urge our compassionate Minister to help everyone who wants to downgrade, give them another HDB concessionary loan, give them an existing smaller flat instead of waiting for a few years, take away the 30-month debarment period for those who downgrade from private properties, especially those who have never bought any HDB flat.

Sir, I have seen many residents who have to pay thousands of dollars a month in renting a flat as they are not allowed to buy directly from HDB, as HDB's evaluation is that they cannot afford to buy a flat. The fact that they have to pay several thousand dollars in renting a flat, this money can be used to pay the mortgage if they are allowed to buy a flat and, eventually, they own the flat. I would like to see more compassion and hope that HDB can relax some restrictions to let more Singaporeans buy rather than spend big chunk of their salary to rent the flats from the open market.

In conclusion, homes are building blocks of a nation. This can especially be said of our HDB flats. Back in 1964, public housing had been designated as more than just a roof over our heads. The Home Ownership for the People Scheme had been initiated to give citizens a tangible asset and a concrete stake in the country, promoting rootedness and a sense of belonging as well as security. This had proven effective, and we quickly achieved the stability and prosperity for our country to grow. I am sure providing housing with compassion to those groups which I mentioned will warm many more hearts.

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6.15 pm

More Support for Young Couples

Mr Zaqy Mohamad: Sir, the Government has been encouraging more Singaporeans to procreate and raise the fertility levels of Singaporeans. One of the biggest hurdles facing younger people today is that sense of security that HDB flats will always be available or affordable for them while retaining their current lifestyle. Also, one reason for the decline in Total Fertility Rate (TFR) is because our young couples are getting married and having children later in life and therefore having less children. Many I speak to cite the affordability and readiness to own a home as a reason why they hold back marriage plans or having children. This is where Member Er Dr Lee Bee Wah's “真的吗?” comes to mind.

We have always spoken about having two bites of the cherry in terms of buying subsidy flats from the HDB. In light of seemingly high property prices in Singapore, can we give our young couples a better headstart, a bigger cherry upfront for the first-timers? Perhaps, the Ministry can consider giving first-time couples increased grants or subsidies in return for longer minimum stay. For example, increasing the subsidy amount but with a 10-year stay period, instead of five. In addition, by having longer minimum stay periods in their HDB flats, we can also help curb speculation among property players.

The Chairman: Mr Gan Thiam Poh, you can take your two cuts together.

Special Credit for Family with Children

Mr Gan Thiam Poh (Pasir Ris-Punggol): Mr Chairman, I would like to propose that we provide a special housing grant for HDB applicants for every child they have subject to a minimum of two children to ease their financial burden and to encourage fertility. We may start with $10,000 for each child which they can use to offset against the payment of the flat. The unfortunate reality is that many of our Singaporean couples today have only one or two children during the initial years of their marriage as they are deterred from having more children due to the high costs of living. Later, when they are more stable financially, and would like to have more children, they may be too old to conceive naturally. This is a problem as more of our couples are getting married and starting their families late.

Quite a number of the lower income families have more than three children. The costs of raising more children are high and the more children there are, the less likely it is for the mother to be working, resulting in a lower household income. We should consider increasing the Special CPF Housing Grant (SHG) for such families to buy their own flat of three rooms or less. Doing so will enable more families who are tenants renting flats under the Public Rental Scheme to become owners. For those who have to continue renting, I appeal to HDB to consider lowering the rental to ease their financial burden.

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Housing Needs of the Elderly

Sir, presently, most of our HDB blocks have at most two room types, for example, 3-room and 4-room types of flats within one block. At my Meet-the-People Session (MPS), I have received a number of requests by families where the children and parents would like to stay near one another, preferably within the same block. They would like to stay in different units so that they can enjoy some privacy and independence. The requirements of the couple with children are usually different from those of their elderly parents, who may even be taking care of an old elderly family member such as a grandparent. To facilitate the building of stronger family bonds and cater to the different budgets and requirements of these families, would HDB consider building blocks with a combination of studio, 2-room, 3-room, 4-room and 5-room flats?

In addition, would HDB consider extending the Lease Buyback Scheme (LBS) to 4-room HDB flat owners? To minimise uncertainty accompanying the probability of occupants outliving the 30-year lease, I suggest that the minimum age of the LBS household be set at 58 years, considering the life expectancy of Singapore females is 84 years and males, 79 years. I am sure this arrangement would be helpful to many elderly couples in the sandwich class.

HDB Resale Levy

Ms Sylvia Lim (Aljunied): Sir, the rationale for the HDB resale levy is stated as achieving a fairer allocation of subsidies between first and second timer purchasers of HDB flats. Thus, a flat owner who purchases a flat directly from HDB, or purchases a resale flat with CPF housing grant, will have to pay back a portion of the sales proceeds to HDB after the flat is sold. The levy may be paid at the point of resale, or deferred to the point of purchase of a second subsidised flat, which will attract interest of 5% per annum.

It seems to be quite a blunt instrument, which may need review in some cases. One group is those who sold their "first" flats some years ago. I have come across residents who had sold their first flats as long ago as in 1999. They had to sell their flats then due to indebtedness. Now they wish to purchase a new flat. The applicable resale levy policy requires them to repay HDB a certain percentage of the flat's resale price or valuation, and interest at 5% per annum for 13 years, which could easily work out to more than $100,000. This is a prohibitive sum, which has made further purchases from HDB unaffordable for them.

Increasing Rental Flat Options

Mr Gerald Giam Yean Song (Non-Constituency Member): Sir, many families with housing difficulties are ineligible for HDB rental flats because they may not meet all the requirements under the Public Rental Flat Scheme. Yet many are unable to buy a BTO flat because they cannot afford the resale levy on the sale of their previous flat, as Ms Sylvia Lim has just mentioned, and renting a room in the open market is prohibitively expensive for them.

On 21 November last year, the Minister told the House that MND may be looking into a higher rental tier to help these families. With a higher rental tier, tenants will pay rents that are higher than the current HDB rental rates but lower than the open market rate.This will enable these families to afford a roof over their head, but without enjoying the full benefits of the usual HDB rental rate. May I ask the Minister for an update on this initiative, and if there are any expected timelines for the implementation?

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HDB Flats for Singles/Divorcees

Mr Lim Biow Chuan: Sir, the Minister for National Development has worked very hard to clear the backlog in the supply of HDB flats for young couples intending to start their families. Since the queue for the flats has shortened considerably, I urge the Government to consider a more flexible policy to allow divorcees and singles to buy or rent flats directly from HDB.

In the case of divorcees, after the divorce, one parent would usually be granted care and control over their children. If the court also orders the matrimonial flat to be sold, this would mean that the parent and his or her child would be without a home unless they can rely on their relatives or friends. Sir, I have visited a 3-room flat where there are six persons sharing the two bedrooms because the existing three-member family has to share the flat with a divorcee who has another two children. Sir, this is quite unhealthy for all the parties concerned, having six of them squeezed into two bedrooms, and certainly not conducive for the children involved.

Instead of the standard policy of asking the divorcee to wait out the debarment period of 30 months, can HDB allow divorcees with children to rent a flat quickly? Alternatively, can they be allowed to buy a flat directly from HDB? Based on a single divorced person's income with children to support, it would be financially difficult for them to buy a resale flat. Sir, I think we can do more to help divorced persons adjust to their situation. And I also agree with Er Dr Lee Bee Wah for HDB to ask applicants to get a letter of no objection from a divorced spouse is not very sensitive. I mean, the acrimony is still there.

Sir, turning to singles, many singles do not choose singlehood as a matter of choice. For some singles, they may have to shift out of their parent's home due to family quarrels or for other personal reasons. Since the regulations governing investments in HDB flats have been tightened, I urge HDB to also consider allowing singles to buy flats directly from HDB.

Debarment Period for Rental Housing

Mr Muhamad Faisal Bin Abdul Manap (Aljunied): Sir, the number of divorces and annulments has been inching up since 2005. In 2010 alone, there were over 7,000 divorces recorded under the Women's Charter and Administration of Muslim Law Act (AMLA). Most divorces end up with the sale of matrimonial homes. I have come across cases where spouses given custody of children were left staring at the prospect of becoming homeless in the process. While young divorcees may find it a little easier to pick up their lives again, older divorcees, especially those with children, may need some help to do so.

The largest group of divorcees in 2010 was aged 35 to 44 years. Some of these divorcees may have no option but to sell their matrimonial homes. If their homes were bought directly from HDB, they face a debarment period of 30 months for a rental flat and a five-year wait period if they want to buy another flat direct from HDB or be listed as an occupier. For older divorcees with custody of children, time is something they do not have on their side. Take the case of a 35-year-old resident, a divorcee with custody of three children and no alimony from her ex-husband. She earned less than $900 a month. The sales proceeds from the disposal of matrimonial home, if any, would be gone in 30 months if her family is forced to rent from the open market. And by the time she is eligible to buy another HDB flat, age would have caught up with her, the loan eligibility would have diminished and job security would be an issue.

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My take on an inclusive society means everyone will not be left alone. That would include singles, divorcees, bankrupts and those who may have been overlooked in our society. Sir, I do understand that HDB will review applications for rental or purchase of new flats for divorcees on a case-by-case basis. The Government may want society to take a pro-family stand. There is nothing wrong with that. We are Asians, we are pro-family, but how we look after the less fortunate, needy and vulnerable section of our society will set us apart from the rest of the pack. Sir, I urge the Ministry to look into releasing or to do away with the debarment period for rental flats for divorcees with children as a start in our resolve to build a truly inclusive society.

Private or HDB Flats for Permanent Residents

Mr Zainal Sapari: Sir, increasing HDB prices have caused widespread concern and deep grievances amongst Singaporeans. Coupled with the strong sentiment that housing prices are also rising because of strong demands from Permanent Residents (PRs), Singaporeans feel aggrieved when they are unable to own a HDB flat or hear stories about PRs renting their HDB flats.

There are stories of PRs buying HDB flats to rent out while they stay at their private homes in Singapore or across the Causeway; stories of PRs buying private properties under their parents' names and getting HDB flats under their names to circumvent HDB guidelines with regard to home ownership and many others.

Sir, I understand the need for PRs to buy resale flats because we want to ensure housing options are affordable for them while they work and live in Singapore. However, we should never allow PRs to use public housing as an investment and we must address the grievances and perceptions that PRs are profiteering from their HDB flats. The number might be small but we will send a strong message that Singaporeans come first in matters of public housing.

I would like to propose some measures to manage these grievances. First, I am proposing for Government to introduce a rule where all PRs, who own private property and an HDB flat prior to the change in laws in October 2010, are required to choose whether to dispose of their HDB flat or their private property. Second, PRs should not be allowed to rent out their HDB flats and there must be rigorous enforcement to ensure this. Finally, I would like to suggest that PRs, who are no longer residing in Singapore after a certain period of time, must not be allowed to retain their HDB flats as well.

6.30 pm

Home for Singaporeans who are at Risk

Assoc Prof Dr Muhammad Faishal Ibrahim (Nee Soon): Sir, during my engagements with my residents, I have met a few residents who have shared with me their difficulties in sustaining their home ownership due to circumstances, such as the loss of jobs, divorce as well as miscalculation on their ability to pay for their mortgages. For some, the family ties were weakened due to the inability of their husbands to pay the mortgages. For those who have just gone through a divorce and sold their matrimonial homes, they shared their fears and uncertainty of starting their lives as divorcees. Their worry heightens when they start thinking of getting a new home to settle down with the children under their custody. Few shared with me that their children's education were affected, as with no proper homes, the children are unable to have a good environment to study. Just last week, I had two cases where both the ex-husband and ex-wife came to meet me to appeal for housing with the respective children under their custody.

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Sir, a home is a place where one creates and builds one's family. It is a place where people can feel safe and relaxed. It is also a place which would provide Singaporeans with a sense of belonging and rootedness to Singapore. In addition, a home represents opportunities and aspirations for the people. Without a home, one would be like a building with the foundation and/or few columns significantly weakened and missing respectively. The building will be weak and fragile and may eventually collapse and disintegrate.

Sir, I am pleased that the Minister, with his admirable vision and passion, together with his staff, has been able to clear the backlog of demand for the first-time applicants. I am also pleased to note that he is moving into the second-time applicants. Sir, I would like to ask the Minister how his Ministry has been helping Singaporeans who are at risk, as defined above, in getting a place to live. Currently, are there any constraints that the Ministry is facing in assisting these groups of Singaporeans in getting a new home? How is the Ministry planning to address this issue?

In moving forward, I hope more can be done to help these groups of Singaporeans. With more stock of housing coming along, I hope the Minister would reserve a portion of these for the groups of Singaporeans to find a new home in a timely manner, be it temporary or permanent, to recover from the crisis that they face and continue their journey upwards in our homeland in Singapore.

Build-To-Order Flats for Singles

Sir, my next cut is on Build-To-Order (BTO) flats for singles. I understand that our housing policy promotes the formation of family nucleus as part of the development of Singapore. However, like many developed nations, the proportion of singles in our population has increased over the last decade. I could sense this from interactions with my residents as well as those who I know from all races and walks of life. Thus, I feel that it is important that our policies are relevant to the current trend to meet the needs of the different stakeholders in Singapore.

Currently, on their own, singles are not allowed to purchase BTO flats. They are only allowed to purchase a resale flat, where they must be at least 35 years old. I have met those who end up staying and growing old with their parents when their parents are alive. However, upon the death of their parents, they may end up not having a home, as the estate of the parents may have to be distributed among their siblings. A few have shared with me that as they grow older, they would like to have a flat of their own and take care of their parents at their home. Although they are able to buy resale flats, being single, they are often limited by the much higher price of resale flats and the additional costs attached to resale flats. In addition, for some who are staying and taking care of their aged parents, they may have to incur higher cost of life.

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Sir, after my interactions with my constituents and other Singaporeans as well as after listening to their plight, I am sympathetic towards this group of Singaporeans. Therefore, I would like to urge the Minister to have the compassion for this group of Singaporeans and provide them with an additional housing option, that is, allowing singles, particularly those who are older, to purchase BTO flats so that they can have a better life here in Singapore.

The Chairman: Mr Desmond Lee, you can take your two cuts together.

Foreign Spouses and HDB Ownership

Mr Desmond Lee (Jurong): Sir, HDB's priority is to provide homes for Singapore families. Lower income Singaporeans with foreign spouses who are not PRs cannot purchase BTO or balance flats from HDB. As a result, some of them face serious housing problems. Currently, their options are: (a) buy a resale flat on the Non-citizen Spouse Scheme with CPF housing grant for singles; (b) rent a room or a flat from the private rental market; or (c) put up with friends or relatives. In many of these cases, these options are either unaffordable and out of reach, or sub-optimal. I would like to ask if the Minister will at some stage consider allowing Singaporeans with non-PR foreign spouses to buy BTO or balance flats. As a safeguard, do not allow their spouses to be joint owners or have succession rights to these flats unless they attain more permanent residency status. This might even be an extension of the Long-Term Visit Pass Plus scheme that was announced yesterday.

Upgrading Programmes

Sir, my next cut is on upgrading programmes. HDB's upgrading schemes have raised the quality of our public housing and given old flats a fresh lease of life. These programmes are very highly subsidised for Singapore citizens, and rightly so. This is a benefit of citizenship. PRs who own flats are not entitled to subsidies unless they are granted citizenship within a year of billing. If they opt to pay for upgrading by instalments, they have to pay HDB's market interest rate rather than the concessionary interest rate that Singaporeans pay. This may cause hardship for PR flat owners with children who are Singapore citizens, particularly those PRs who are widowed or divorced spouses of Singapore citizens. There will also be a direct financial impact on their Singaporean children. Some PRs, especially housewives, may take quite some time before they qualify for citizenship, if at all. Will the Minister therefore consider extending some subsidy or concessionary instalment programme for such families?

A Home for Life

Mdm Foo Mee Har: Sir, we often hear the saying, "A man's home is his castle." This is particularly true in Asia, where home ownership is an entrenched life goal for many. Public housing in Singapore has made this dream a reality for millions of Singaporeans. The HDB flat has become a significant asset to many Singaporeans.

Over the course of my work with my constituents, I noticed a sizable number of residents monetising their HDB flats prematurely, and subsequently have difficulty in providing housing for their family. The reasons they give for selling range from problems with monthly repayments, raising funds to meet expenses, settling their debts, starting a business or simply spending beyond their means. I even know of one couple who actually sold their flat to fund their son's wedding of $50,000!

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For many families, they end up "homeless", constantly on the move, taking shelter with family and friends, usually with no permanent solution in sight. Children suffer greatly as such temporary housing may not be near their schools, and there is usually no suitable place for study in overcrowded shared accommodations.

Every week, I help these families to write appeal letters for rental flats. Unfortunately, there are so many others like them, and the supply cannot keep up with demand. I understand that the average waiting time for rental flats is now six months with 1,600 families in the queue. I also know that HDB has already committed to build more rental flats and more supply is in the pipeline. But, Sir, this situation is not sustainable. We must take active interventions to help Singaporeans better understand financial planning and the value of their homes, particularly with the vulnerable groups.

We can learn from the discipline that we have already instituted in Singapore to protect consumers. There are systematic steps that banks are obliged to take to ensure that their customers understand their investment decisions and the associated risks, before such transactions can be executed. Furthermore, there is a recent regulatory directive enforced for complex products, requiring a "Customer Knowledge Assessment" to be conducted, with all prospective investors before they can transact. For those who lack the relevant knowledge, banks must adopt due diligence measures. This discipline required of banks demonstrates the importance of taking proactive measures in order to protect the interests of consumers.

Sir, to help those in need of advice relating to their homes, I would like to ask the Minister to consider taking learnings from the financial sector to protect families at risk. Whilst there is a simple HDB "Resale Checklist for Sellers" to prompt homeowners to think about their housing and financial plans, I really believe that there is more we can do.

HDB owners must realise that a flat is a home for their family, beyond just an asset to be monetised, to meet their short-term needs. More effort should be made to help owners understand the risks they are taking by selling their homes. Attention should be drawn to the debarment period and the difficulties in obtaining a rental flat, and also the challenges that come with living in temporary housing. We should help families understand the range of other options available other than a sale, for example, downgrading to a smaller flat. We should also explore collaboration with other agencies, such as the Family Service Centre, to work out alternatives to solving financial problems. And owners who have sold their homes need to understand how to protect the proceeds of the sale from short-term spending. Sir, most families in such difficulties have poor financial planning skills. A proactive measure or proactive approach would go a long way to help prevent families, especially those at risk, from becoming homeless.

The Minister for National Development (Mr Khaw Boon Wan): Sir, last month, we mourned the passing of the late Dr Toh Chin Chye. He was my first boss in the Health Ministry. I had the privilege to observe at close range how he lived the values of his generation who built modern Singapore − frugality, hard work, personal sacrifice, devotion to family and compassion for the vulnerable.

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During his long years in public service, Dr Toh was briefly in MND in 1960, the year when HDB was formed, with the late Mr Lim Kim San as its first Chairman. Mr Lim was tasked to solve an acute housing problem. Under his watch, public housing and home ownership became firmly established, and, eventually, HDB living has become the Singaporean way of life.

Mr Lim Kim San roped in Mr Howe Yoon Chong as the Chief Executive of HDB. In his straight-talking and no-nonsense way, the late Mr Howe led HDB to build 21,000 flats in three years. It was an unprecedented feat at that time. The construction industry nicknamed him the "bulldozer", who rammed through any obstacle just to get things done. This included the politically arduous task of building the first HDB town in Toa Payoh, against very fierce opposition from the squatters there.

Last June, when I stepped into MND, I was mindful that I was stepping into the shoes of these giants. MND benefited from these and other giants. For instance, I remember Mr Dhanabalan who brought HDB living to new heights with more varieties in design through involving the private architects. To enhance the HDB experience, Mr Dhanabalan started the park connector project in 1991. The network now spans over 200 kilometres and has set the foundation for our City in a Garden vision.

Mr Dhanabalan had an outstanding CEO in Mr Liu Thai Ker − an unusual talent with deep knowledge of Chinese culture. Mr Liu and his team picked an excellent piece of calligraphy by the late Mr Pan Shou to display in the HDB lobby to remind HDB staff of their mission. This was the one in which Pan Shou captured on paper – a giant piece of rice paper – the moving poem of Du Fu, a Tang Dynasty poet:

安得广厦千万间

大庇天下寒士俱欢颜

风雨不动安如山

My translation is this: "How I wish there would suddenly appear tens of millions of houses to house everyone, especially the poor, so that they can live in comfort and rejoice, and protected against any thunderstorms."

6.45 pm

I first read this poem when I was still in high school and immediately committed it to memory, especially the last two lines:

何时眼前突兀见此屋

吾庐独破受冻死亦足!

"If the price for realising this wish is that I alone, my own hut, is destroyed in the storm, and I freeze to death, so be it." What a great vow! Du Fu's compassion and deep sense of self-sacrifice left a deep imprint in me, and I am sure in many Chinese scholars. He died a pauper but this, and many of his other poems immortalised him. And I am glad that despite many changes in HDB leadership over the years, Pan Shou's calligraphy still hangs in HDB's lobby, as it should. I recall this part of MND's history, not out of nostalgia, but because I want to draw on the wisdom of these pioneers. Their ideas and the values underpinning their thinking process remain equally relevant today and in the future. Let me distil them into three learning points: (i) focus on the longer term greater good of many; (ii) put community interest above self interest; and (iii) dare to try. It was with this spirit that they turned rural Toa Payoh into a thriving modern township of today and Singapore a world-renowned Garden City. We owe them a lot.

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I stepped into MND facing a hot housing problem. A severe mismatch in supply and demand, coupled with global liquidity and low interest rates, caused a sharp spike in housing prices. The situation reminded me of a speech that the late Dr Goh Keng Swee made in 1980 on the plight of pig farmers. I was then a very young civil servant and I remembered that particular speech. He spoke on what the economists referred to as the pig cycle. I think the economists in this House will know the cobweb theorem. When the price of pork is high, pig farmers rear more pigs in the hope that they will make more money. However, when the piglets grow up and reach the market, there is, of course, a glut and prices drop. Farmers then cut the number of piglets they are going to raise the next time, and thereby ensuring that when these piglets mature, there will be a shortage and prices go up again. The pig cycle.

The pig cycle applies to many economic activities: vegetables, rice, even container shipping. As I read last week, container shippers are now in deep trouble. All follow the pig cycle. Dr Goh used the pig cycle to explain the difficulty of matching the supply of hotel rooms to actual tourist arrivals resulting in a critical shortage of hotel rooms at that time. With more sophisticated projection, Dr Goh hoped that planners and hoteliers might perform better than pig farmers. But being a very wise man, wisely he added a caveat that in real life, events seldom move in accordance with projections. Adding a poetic touch to his speech, Dr Goh referred to Scottish poet Robert Burns' poem "To a mouse". Let me recite the key stanza:

"But little Mouse, you are not alone,

In proving foresight may be vain:

The best laid schemes of mice and men

Go often askew,

And leave us nothing but grief and pain,

For promised joy!"

"The best laid schemes of mice and men go often askew." Some of you may remember John Steinbeck subsequently wrote a book " Of Mice and Men" , which was made into a movie. And such is the occupational hazard of planners. The best laid scheme can often go askew. This is particularly so for Singapore where the larger global environment, over which we have little control, can easily derail our projections. And that was how MND's housing projection and recent rebuilding programmes went askew, when our population shot past projections, mortgage interest rates plunged and our economy made a surprisingly quick and strong rebound in 2010. And bear in mind how difficult it is for the construction industry to ramp up and slow down. There is a long lead time.

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Many months of corrective action, policy modifications and hard work have brought some stability to the housing market. We are not yet out of the tunnel, but we are seeing some light at the end of it. Er Dr Lee Bee Wah shared a similar observation.

In the last quarter, private residential property prices rose by 0.2%, the lowest increase in over two years. HDB resale prices went up by 1.7%, lower than the preceding two quarters. This year, housing prices should moderate further. In some areas, they may even soften; and in some areas, they have already softened. How exactly property prices move in the coming months will depend on global economic developments: the sovereign debt crisis in Europe, the performance of the US and Chinese economies, oil prices and interest rates. We monitor these changes closely and will refine our policies in step with the economy.

Mr Zainal Sapari suggested that we take further measures and tighten home ownership rules. Mr Gan Thiam Poh raised the idea of shorter lease for some BTO flats. Mr Zaqy Mohamad asked for a larger housing grant in return for a longer Minimum Occupation Period. I have heard them and noted their suggestions but I do not propose any new measure, given the current price trend. Let us give the existing measures time to fully mature.

Overall, we have made real progress. I thank HDB officials who have been working very hard to accelerate the building programme as well as many other agencies, our consultants, contractors and construction workers who partnered us in this effort. I must also thank Singaporeans who have been patient and understanding as we tackled the issue.

By now, almost all newlywed first-timers earning below $10,000 a month can select a BTO flat if they apply for one. This year, we are launching another 25,000 BTO flats. As the number of marriages eligible for BTO flats is about 15,000 a year, I can now start to address the housing needs of other buyers. Not all buyer groups, but some.

First, the HDB second-timers. These comprise upgraders, downgraders and divorcees with children. Each recent BTO launch attracted about 4,600 such applicants. With priority given to first-timers, they compete for only 5% of each launch, so resulting in very high application rates. Starting with the next BTO launch this month, we will triple the second-timer allocation of new flats in non-mature estates from 5% to 15%. This should cut the second-timer application rate from above 25 to a single digit, while keeping first-timer application rate below two.

We will maintain the status quo for BTOs in mature estates and Sale of Balance Flats. This way, first-timers can continue to enjoy top priority in allocation. We will study the March BTO results, before we make the next tweak to the balloting rules for subsequent launches.

As for Executive Condominiums (ECs), we will adjust the 95/5 split between first-timer and second-timer applicants to 70/30 immediately; in other words, second-timers' allocation will increase six-fold from 5% to 30%, to match the prevailing profile of the applicants.

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Second, the plight of the HDB rental applicants, as highlighted by some Members, including Dr Faishal Ibrahim. We made some progress last year but I know that more still needs to be done. The rental flat building programme is in progress. As completed units come on stream, more families will benefit. Last year, we successfully placed 3,300 families in HDB rental flats. The waiting time for HDB rental flats has come down to five months. We will continue to work on this problem. But let us remember the larger social factors which cause this problem, as Mdm Foo Mee Har reminded us, including, for example, teenage marriages, divorces and problem gambling. While MND addresses the downstream problems, our society at large collectively needs to tackle the upstream causes and focus on prevention. Simply building more and more rental units is not a sustainable strategy. We have to help prevent the problem.

Senior Parliamentary Secretary Dr Maliki is piloting a scheme in his constituency in which he mobilised local resources, and that include the Community Development Council (CDC) and Family Service Centre (FSC) to help vulnerable families improve their lot: better education for their kids, higher skills and better jobs for themselves, or simply undergoing marriage counselling. It is hard work, it is uphill but immensely satisfying when families get rescued and are put onto a recovery path.

Mdm Foo highlighted one upstream problem – families selling their flats to pay their debts or short-term expenses, and some under the duress of loan sharks. These illegal moneylenders take the debtor's cash proceeds and leave the seller homeless. And they end up in HDB office asking for a rental unit. Last month, The Straits Times and Berita Harian highlighted this problem. It is both sad and disturbing. As a society, how can we prevent such a tragedy?

On HDB's part, we will implement Mdm Foo's suggestion: tighten financial counselling, step up the checks on prospective sellers, make sure the families understood and have viable housing alternatives before selling their flats. Where we suspect that the sale would do more harm for the family, we will try to actively discourage the sale. We will work with the local FSCs, as suggested by Mdm Foo. And I hope Singaporeans will accept this paternalistic approach for the good of the families involved. Separately, the Council for Estate Agencies (CEA), who look after registered estate agents, will also watch out for any unscrupulous estate agents who partner loan sharks. We will flush them out. We welcome whistle-blowers and honest feedback. I do not know if these measures are enough to minimise the problem. But if need be, we should be prepared to consider tougher measures. For example, we must try to find a way to prevent the loan sharks from getting the cash proceeds. I welcome suggestions from Members.

Ultimately, our objective is to get families into home ownership. Public rental should only be an interim, not a permanent arrangement. Last year, we were happy to help 340 households transit from public rental into home ownership. Mr Azhari was one example. He was allocated a rental flat in 2006. Subsequently, he found a steady job and his income increased to $1,400. He applied successfully for a 3-room BTO flat in Punggol, with the help of an Additional Housing Grant of $40,000. He has just collected the keys to his new home. He is able to service his HDB loan using just his CPF funds, without paying cash out-of-pocket. We are happy for him and his family.

Yesterday, Deputy Prime Minister Tharman mentioned that even a low-income family with $1,000 per month salary can afford an HDB flat. This piece of comment caused a stir, precisely because it sounded so incredible. Deputy Prime Minister was referring to a 2-room HDB flat, which we started building a few years ago.

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The subsidised BTO price for such a unit in a recent launch – I have been launching this for several months now – is about $100,000. If he is an HDB first-timer − because he was talking about a young couple − then he will be entitled to a total housing subsidy of $60,000 from the Additional CPF Housing Grant and the Special CPF Housing Grant, which we introduced not too long ago. The net selling price to him is, therefore, about $40,000. The monthly mortgage payment on such an HDB loan can be fully covered from his CPF contributions, without any cash payment out-of-pocket. In practice, most 2-room BTO applicants earn above this level of $1,000. The median income of 2-room applicants in recent BTO launch is about $1,400.

7.00 pm

NCMP Gerald Giam asked about those who are not eligible for rental units because their salaries exceed $1,500. Currently, the threshold is $1,500. What we have done is this. We look at the individual cases, on a case-by-case basis, and we have been allowing some who exceed $1,500, if there are good reasons. Not everyone who applies will get it, but where we have good reasons to be compassionate, we do exercise that flexibility. So, we have families with salaries above $1,500 now living in HDB rental flats. As for the exact number, I do not carry that in my head. The rental, as we discussed with Mr Giam in this House last time, quite rightly and he supported it too, has to be higher than those who are below $1,500, but it would still be significantly below market rate.

Third, the retirees. Many have provided for their retirement and are comfortable physically, socially and financially. But some are finding the cost of living a challenge. If they are living in a larger HDB flat with their mortgages largely paid up, they will have options. Renting out a room brings some income, besides useful company. For some, right-sizing to a smaller unit makes a lot of sense. That is why we build Studio Apartments, and they are popular. HDB will launch 2,000 Studio Apartments this year. Many will be in the mature estates. To further facilitate right-sizing, as you heard in the Budget Speech, we are introducing the Silver Housing Bonus and we are also enhancing the Lease Buyback Scheme. Many Members have commented on these two initiatives and offered useful suggestions, both during the last few days as well as today. We will study them. In particular, we will review the CPF Retirement Account top-up criteria with MOF. We hope to complete the review and announce the details in a few months' time.

To support the elderly, who prefer to remain in their neighbourhood, we will introduce a new Ageing-in-Place Priority Scheme. This is the idea that Er Dr Lee Bee Wah talked about earlier. It was also an idea that the Senior Parliamentary Secretary Ms Sim Ann gave to me a few weeks ago, which is to give elderly applicants of a Studio Apartment higher ballot chances if the Studio Apartment is in the same town or estate within 2 km of their existing property, so that they do not have to move too far away and their children can also be with them. We will implement this idea from the next BTO launch this month.

Mr Gan Thiam Poh and Ms Sylvia Lim asked that we relook at the resale levy for elderly and genuine cases seeking to downgrade. There is no resale levy if they buy a Studio Apartment or a resale flat. But for those who want to buy a new flat, the levy, as Ms Sylvia Lim reiterated, is to ensure that those who have never benefited from any housing subsidy gets more subsidy than those who have already benefited once before. But I know, on the ground, in many cases, it can cause difficulties. On a case-by-case basis, I have been looking at them, and we will try to assist where we can, and we have been trying. On the case that Ms Sylvia Lim mentioned, if she can directly send it to me, I will take a look.

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Fourth, many Singaporean families want to live together, or at least near to one another. This forges strong families besides making a lot of practical sense. Grandparents help to look after their grandchildren; grandparents remain active, healthy and engaged, and parents set good examples of filial piety. These are strong values which we must inculcate. Er Dr Lee Bee Wah made a strong call for this, and I totally agree.

We are building more HDB flats in mature estates, wherever feasible, if there are huge pieces of land available. This year, there will be BTO launches in Bedok, Kallang, Whampoa and Geylang. Indeed, 30% of BTO flats to be launched this year will be in mature estates. This will allow many more young families to benefit from the Married Child Priority Scheme. And to provide further support for these families, we would increase the ballot chances for those applying to stay with their married children or parents, starting from the next BTO this month.

Mr Gan Thiam Poh suggested that we build more integrated flats to encourage family bonding. I agree, and I support. We will introduce a new scheme – Multi-Generation Priority Scheme (MGPS) – to give more options for families to stay together. In the Sky Terrace@Dawson BTO project, HDB experimented with pairing a larger flat with an adjoining Studio Apartment. These units allow extended families to live next to each other. It makes a lot of sense. MGPS will build on this and enhance it by allowing joint selection of a BTO unit by the married child with either a Studio Apartment or a 2-room flat by the parents. So, they both apply together. We plan to launch 250 pairs of MGPS units in various estates this year, starting with the Bedok BTO project this month. We will offer more MGPS pairs if they prove to be popular.

Er Dr Lee Bee Wah urged that we encourage children, either single or married, to take care of their parents in their old age. I agree. For singles, we provide a higher tier CPF housing grant of $20,000 for them to buy a resale flat to stay with their parents. We have also raised the income ceiling for the grant from $8,000 to $10,000, to enable more singles to qualify for the grant. Assoc Prof Dr Muhammad Faishal Ibrahim and Mr Lim Biow Chuan asked that we allow singles to buy BTO flats directly. Actually if they are above 21 years old, they can already do so. They can form a family nucleus with their parents to buy a new flat together because, as Er Dr Lee put it, the motivation is that he or she can look after their parents; so they should be staying together. So long as they are above 21 years old, they can already do so. But if they just want to be alone and stay by themselves, I am still mulling over how to help them as well as other groups faced with special circumstances, eg, foreign spouses, as mentioned by Mr Desmond Lee earlier. I have not forgotten these groups. They are very much on the top of my head. Last year, my priority was first-timers; this year, various groups of second-timers. I think after I bite into this and address the problem in a substantial way, I will try to find some solutions for some of these singles as well as other special groups. The key point is that we must not unwittingly compromise on the promotion of marriage and mutual family support that we have long held.

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The final group that I pay particular attention to are Singaporeans who are in distress due to circumstances beyond their control: sudden death of a breadwinner, major illness of a family member, severe disabilities. These are victims of misfortune and sometimes our policies and rules do leave them cold on the wrong side. Let me give one example. Last December, which was not too long ago, the local media reported – if you remember – of a freak accident off Pasir Panjang Terminal in which a Singaporean lorry driver was killed. The deceased had earlier successfully selected a 4-room BTO flat in Chua Chu Kang. But he never got to enjoy this new flat. He left behind a widow and four children. Media report highlighted his widow's plight that she was at risk of losing the BTO flat and becoming homeless, because she is a foreigner. The rule is clear – the flat is for Singaporeans. We design policies to cater to the vast majority of population, with clear rules laid out, to promote self-reliance and prevent abuse or gaming. But when we come across deserving cases, we must exercise compassion and treat them as special cases. For victims of misfortune, I have always impressed on my MND colleagues that our default position is to try to say "yes", to help give such victims a leg-up at a time of need. So, for the Pasir Panjang accident case, HDB is helping the family to keep their 4-room flat in Chua Chu Kang, which I think will be completed next year. Fortunately, while the widow is a foreigner, the children are Singaporeans. So, that gives me a leverage, a reason to allow this family to retain this flat.

Er Dr Lee Bee Wah, Mr Muhamad Faisal Manap and Mr Lim Biow Chuan spoke about the plight of divorcees. We are sympathetic with divorcees, especially when they have young children to support, face financial hardship and have no family support. We will always try to help them. As we free up, loosen the balloting for second-timers, many of them should be able to benefit from this initiative. Last year, we allocated 670 public rental flats to divorcees with children. This is more than 20% of the rental flats allocated last year. Nevertheless, we must be mindful that divorcees do not form a homogenous group. In the West, many sympathetic rules designed to help divorcees get abused, with couples claiming such benefits even though their marriages are intact. We have to be discerning when claiming a case to be special. It must really be special. And that is why we have to deal with this on a case-by-case basis. I pay some attention to the comments written by the Members when they write in. So, I am counting on Members to do some due diligence. Do not just take their word for it. We need to do some probing.

Er Dr Lee Bee Wah called for a compassionate housing policy. We do. We strive to govern with compassion. The Pasir Panjang accident case is one example, but there are many such examples in our files. Governance with compassion requires a good heart, but it also requires a strong head. Much of the problem of the Western welfare model is that there are too many good hearts and too few strong heads. Solutions become unsustainable. Greece is now a classic case. Let us always be aware of this hazard.

Sir, in MOH and now MND, I have always stuck to basic values when formulating public policies, in eight simple words: "老者安之; 少者怀之" − Try to help the seniors so that they can age with peace of mind. And shower the junior with love and care. This ancient Confucian ethos underpins strong families, the marriage institution and filial piety. This is how a strong society is built. With growing individualism, like Er Dr Lee Bee Wah, I worry that these values are getting diluted.

"Try to help the seniors so that they can age with peace of mind. And shower the junior with love and care." This ancient Confucian ethos underpins strong families, the marriage institution and filial piety. This is how a strong society is built. With growing individualism, like Er Dr Lee Bee Wah, I worry that these values are getting diluted. There are worrying signs: rising divorce rates, abandonment of parents. These are larger social issues, beyond MND, but they impact MND's work.

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At the very least, MND policies must not unwittingly facilitate such negative trends. And where possible, MND policies must actively try to support positive trends. Our latest initiatives, such as the Silver Housing Bonus, the enhanced Lease Buyback Scheme, the Multi-Generation Priority Scheme and the Ageing-in-Place Priority Scheme are all designed to support this ethos.

7.15 pm

Mr Chairman, MND goes beyond public housing and HDB. Through AVA, BCA, CEA, NParks and URA, our work affects Singaporeans' larger quality of life, current and in the future. Through the good work of our pioneers, we can now enjoy today's high standard of living. Our duty is to ensure that our children and grandchildren will be similarly blessed. While attending to immediate needs are important, we must never forget to plan and build for the future.

As this is my first MND COS, let me briefly highlight three key challenges that will shape our workplan over the next few years. First, how do we go beyond building homes to building communities? We used to live in kampongs where everyone knows everyone. There is a general consensus on how we can live together. We take care of one another – gotong royong – as well as our little kampong .

As we moved into city living, many things improved. But, yet, we became more isolated from one another even when we lived more closely together. And that is the irony of it. Much of the kampong spirit is lost. Many do not even know their neighbours. We lost some of the basic courtesy we used to have for one another. We care less about our neighbours and the community spaces that we share.

There are many reasons for the loss of the kampong spirit. But we need to find ways to encourage residents to own their community and to care for one another again. To be sure, there are areas in Singapore where the kampong spirit remains strong. I am most proud and happy that the kampong spirit in my constituency is very strong. Yishun South as well, so said Er Dr Lee Bee Wah. We need to find out how such spirit can be replicated in many more places.

Second, how do we prepare for the silver tsunami? In 20 years' time, one in five Singaporeans will be over 65 years old; one in 20 over 80. If I am still alive, I will be one of the one in 20. Many will be living alone because many Singaporeans have chosen not to get married. The whole texture of society will change. The built environment will need to evolve to accommodate the needs and aspirations of older Singaporeans. Certainly, we will need more nursing homes, more day care centres, more day rehabilitation centres, better wheelchair access, etc. But there is much more that is needed. There is no one size that will fit all. We do not know exactly which will work more effectively. We just need to try many models to see which one works best for us.

Third, how do we keep our city world-class? There are many islands along and around the Malacca Straits and South China Sea. That Singapore is a prosperous First World city, while other islands remain undeveloped is perhaps due to our good fortune in history but also to the foresight and diligence of our pioneers. But nothing stays forever. Just look at history. Many of the older cities in the United States have shrunk. The economy that drove the growth of these cities withered. Businesses and jobs went away. Similar history played out in UK and many European cities.

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Singapore must stay at the top of the competition of cities because this is our only city. And it is not just about the economy. Our children are now well-educated. Many are much sought after by other countries and cities for their talent. To keep them here, Singapore must remain the best place for them to live, work and play. Beyond a vibrant physical landscape, we must aspire to cultivate a graciousness of life in Singapore, founded on the ethos of inclusiveness, compassion and kindness − kindness for all living things, kindness for our environment.

In short, MND's strategic challenge is to prepare for a very different world, physically and socially. Like everything else, where we were and where we are now will not matter much 20 years from now. Singapore can only be a great city for us to live, work and play tomorrow, if we make the right choices and do the right things now.

The Chairman: Minister, I look forward to another poetic and heart-warming intervention from you now.