Government's Acquisition of Properties at Rochor Centre

Ms Denise Phua Lay Peng asked the Minister for National Development with regard to the state acquisition of Rochor Centre (a) whether the Ministry would explain the rationale for the compensation of acquired flats and the pricing of new replacement flats; and (b) whether it would favourably consider (i) added compensation for the current flats, especially for those who have purchased their flats at higher price points; (ii) giving priority to Build-to-Order applications in other areas should residents choose not to relocate to the allocated Kallang replacement site; (iii) reducing the resale levy; (iv) waiving the need to top-up the CPF Minimum Sum for affected retirees as a result of the enforced sale; and (v) giving priority to co-occupiers of the flats, especially adult children, should they apply for units under the sale of balance flats in the new Kallang development.

Mr Khaw Boon Wan: The extent of compensation that the flat owners at Rochor Centre will receive is governed by the Land Acquisition Act. Specifically, they will be compensated based on the prevailing market values of their existing flats as at the date of the acquisition, which is, 15 November last year. The market value will be assessed by a qualified and professional private valuer licensed by the Inland Revenue Authority of Singapore (IRAS) after a thorough physical inspection of each flat. In addition, they will also be given reasonable expenses, which comprise a removal allowance as well as stamp and conveyancing fees to buy a comparable replacement flat.

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As home ownership is an important social objective, flat owners whose homes are acquired for a public purpose, like in the case of the Rochor Centre, are given a relocation package, with benefits similar to those offered under the Selective En bloc Redevelopment Scheme (SERS). The new replacement flats, with a fresh 99-year lease -- and I think this is a very important point -- will be offered at subsidised prices, similar to those applicable to all eligible public applicants in HDB's sales exercises. However, the prices will be frozen as at the date of acquisition, 15 November, with a further 20% price discount, of up to $30,000, for eligible flat owners.

Ms Denise Phua has made several requests on behalf of her constituents. She is a very good Member of Parliament and a very hardworking one, too. Let me reply briefly to the requests as the individual package for each flat owner is still being computed and communicated to the affected flat owners.

First, on whether there could be added compensation for those who have bought their flats at a higher price: we need to be fair to all residents. Hence, the compensation has to be on the same basis of market value, irrespective of the original purchase prices. The valuer will take into account the resale transaction prices just before the acquisition was announced, as well as the individual attributes of the flats, including the extent and the condition of renovation, amongst others.

Second, on whether to give Rochor Centre residents priority to Build-to-Order (BTO) applications in other areas should they choose not to relocate to the Kallang replacement site: here we need to balance the needs of Rochor Centre residents and those of the other public applicants. We are, nevertheless, studying the proposal carefully.

Third, on whether the resale levy can be reduced: we can extend some concessions to help the flat owners. For example, for those eligible for the 20% price discount, they can choose to forgo the discount in lieu of paying the resale levy, provided, of course, it is advantageous to them. For those who are not eligible, they may incorporate $30,000 of the resale levy as part of the purchase price of the replacement flat, and defer the balance amount, without interest, until they sell or they transfer the replacement flat.

Fourth, for retirees affected by the CPF Minimum Sum, HDB will help them appeal to CPF Board to use part of the amount to be refunded into the CPF Retirement Account to pay for the replacement flat. As each case is unique, CPF Board and HDB will work together to help the affected flat owners as much as we can, subject to financial prudence.

Finally, on the request to give priority to co-occupiers of the flats should they apply for units under the sale of balance flats in the new Kallang development, the married children can benefit under the Married Child Priority Scheme. They will have double the chances compared to other applicants, once their parents have selected their replacement flats in Kallang.

Ms Denise Phua Lay Peng: Sir, to be fair, I think not all the terms of the forced acquisition and the relocation for my residents are negative. For example, the fresh lease of 99 years versus the current 60 years. And, of course, I have been told many times that these practices have been in place for many years, and that the terms apply to other SERS projects. What I am asking Minister for is perhaps for Minister to consider a small work team that comprises some of us to represent the residents' needs, to see if some of these practices can be updated and improved. Especially in the case of, I guess, forced acquisitions where residents actually lose the choice of the time that they would prefer to sell and also the choice of their preferred dwelling. I think there is a case for studying some of these practices – which have been told to me many times – that have been in place for so long. I just ask for a work team to do that. Some of the practices that may need to be re-considered are, for example, the valuation of the current flat –

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Mr Speaker: Ms Phua, can you ask the question?

Ms Denise Phua Lay Peng: Would the Minister consider the appointment of, for example, more than one valuer to value these flats? And for those who have just reached retirement or in the last few years reached retirement, relieve them financially without having to top up their CPF Minimum Sum and then have to use whatever is left in the nett proceeds to pay for renovation and upgrading, if possible and also to repay the resale levy at the time that is not of their choice. I know Minister is very compassionate so I ask Minister to consider allowing us to work with the agencies and the Ministry to update some of these practices.

Mr Khaw Boon Wan: The short answer is a big yes, since both of us personify compassion. Specifically, we would definitely want to work with the MP and her activists to try to find the best way out for the residents who are affected by this. We are extremely mindful that this is an acquisition and suddenly all these come along and then you lose your home where you have stayed for a number of years. We will be as fair as we can and, at the same time, the fact that this is not a first acquisition in Singapore, we have to maintain a certain amount of consistency. Otherwise, the previous owners who were affected would rightly yell and say, "What is happening? Why do you have inconsistent practices in place?" But where we can find a good reason to vary or improve on some of the terms because the situations are unique, we will certainly try to do so.

I think the choice of one valuer versus more than one is quite simple. Whenever valuation is involved, two valuers may come up with two different answers. For the same estate, we try to have one common firm. I think that will help the process of valuation and future disputes. In any case, for anybody who is unhappy with the valuation, there is an appeal process involved. There is an Appeals Board in which case probably the valuation may require a re-valuation by a different firm. So the opportunity for a separate valuation is out there.

As for the CPF Minimum Sum for seniors who are affected, as I have said in my reply, we are on the same side here. We will work together with the MP and the residents to try to make a case to CPF to try to help out. As far as we can see, provided the movement is lateral, in other words, if you stay in a 3-room flat and you move to an equivalent 3-room flat, they should not end up having to get money out-of-pocket. That has always been our experience in previous SERS cases. I see no reason why, in this instance, that should not also be the case.

Mr Gan Thiam Poh (Pasir Ris-Punggol): Mr Speaker, Sir, before I raise my question, I would like to declare my interest. I work in a bank. Question 11, Sir.

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