RAPID TRANSIT SYSTEMS (AMENDMENT) BILL

RAPID TRANSIT SYSTEMS (AMENDMENT) BILL: Order for Second Reading read.

4.15 pm

The Second Minister for Transport (Mrs Lim Hwee Hua): Mdm Deputy Speaker, I beg to move, "That the Bill be now read a Second time."

Madam, the Bill before this House provides for the implementation of a new rail financing framework in order to achieve the objectives as stated in the Land Transport Master Plan (LTMP), namely, to facilitate the future expansion of the Rapid Transit System (RTS) network in a financially sustainable manner and to inject greater contestability into the rail industry. At the same time, we are augmenting the Land Transport Authority's (LTA) regulatory powers to enhance integration, to safeguard the continuity of rail operations and to enhance security.

Rail financing framework to support future expansion of rail network

As our population grows, we need to expand in tandem with our RTS network which serves as the backbone of our public transport system. While the Government is committed to expanding the rail network, we are mindful that rail infrastructure is increasingly costly to build and maintain.

To ensure fiscal prudence, hitherto, we have always required new RTS lines to be both economically and financially viable before a decision is made to build the line. Government has funded and will continue to fund in full all the infrastructure costs for building new lines as long as they are financially viable thereafter. This means that each new line must be able to generate enough revenue to cover its operating costs so that

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Government does not have to provide any subvention to ensure it is viable.

The current evaluation of the financial viability of a new line is conducted on a line-by-line basis. As we expand the rail network, new lines will become more costly to operate and maintain as they will mainly have to be built underground. At the same time, as they serve the less mature corridors with lower ridership, they will be less profitable initially than existing lines. Yet, when new lines are added, they generate positive externalities which benefit the rest of the existing RTS network. Under the existing framework of line-based financial evaluation, these network benefits are not recognised.

Such network benefits should really be taken into consideration when evaluating the financial viability of future rail lines. Such an approach will help bring forward the implementation of new rail lines that may fall short of being financially viable on their own, but will fulfil the viability criteria when evaluated on an overall network basis. This is an important refinement which we feel is now appropriate to be made as we have had over two decades of operating the MRT and are better able to project the network effects of the rail system. What is unchanged, however, is our basic financial discipline of not providing subsidy for operating costs for rail operations as a whole.

To inject greater contestability in the RTS industry

Madam, in order to enhance the level of efficiency in the rail industry, we will be injecting greater contestability into the RTS industry. The current duration of 30 to 40-year licences issued to the operators is too long to provide an effective threat of contestability to the incumbent operator. As is the experience elsewhere, the duration should be shortened to introduce contestability to the industry and compel the incumbent to

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improve its efficiency, cost competitiveness and service levels. Such competition will help to drive better performance and efficiency, which in turn will bring about higher service standards and productivity.

Even as we are making changes to the rail financing framework and possibly the industry structure through greater contestability, one key aspect of public transport will remain unchanged – the regulation of fares by the Public Transport Council (PTC) in accordance with the fare adjustment formula, based on macroeconomic factors, national inflation and wage increases, rather than the operators' specific costs.

Features of new rail financing framework

Going forward, we will enhance the rail financing framework by introducing the following features: first, we will adopt a network approach so that new lines can potentially be introduced based on the overall network viability. The new network financial evaluation approach would be applicable to the next round of rail expansion plans beyond those that have already been announced under the LTMP, such as Downtown Line, Thomson Line and Eastern Region Line, which were all financially viable under the old criteria of individual line evaluation. We will carefully study which new corridors would require new rail lines as part of our integrated land-use and transport planning process under the on-going Concept Plan 2011 exercise. With this new rail financing framework in place, we can then consider how best to implement this for future lines, while continuing to ensure that the overall network remains financially viable.

Second, to effect greater contestability, the licence period for new RTS licences will be shortened to about 15 years. To facilitate the new financing approach as well as the shorter licence periods, LTA will take over the ownership of the

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operating assets and lease them to the operators instead. By taking on ownership of all RTS operating assets, LTA will be able to undertake integrated and holistic long-term planning for the RTS network, including planning of new lines and effect the timely purchase of more assets, such as trains, to enhance carrying capacity. Under the new arrangements, operators will be required to follow a rigorous set of Asset Management Requirements (AMR) for maintaining the assets leased from LTA, failing which the operators will be penalised accordingly.

Madam, we are implementing the new framework for RTS licences, starting from the next major RTS line – the Downtown Line (DTL). We will adopt a gradual approach and limit the tender to our two existing operators, SMRT and SBS Transit. This will allow us to phase in the changes before we consider opening the sector to new players in the future. Some may argue that by limiting the tender to the two existing players, we will not be able to enhance the level of contestability in the RTS industry. The issue here is really not about the number of potential players in the industry. Rather, the intent is to increase the level of competitive pressure in the industry by issuing shorter licence periods and ensure that the incumbent operator will have to face the prospect of competition at the end of their licence term. The shorter licence period would also allow LTA, as a regulator, to re-set and refresh licence conditions as appropriate, to take into consideration changes to the operating and business environment.

Key provisions of the Bill

Madam, let me now elaborate on the key provisions in the Bill.

Under the new financing framework, LTA will collect from the operator a

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licence charge payable for the right to run and generate returns from the revenue service. The licence charge may comprise fixed and variable components, with a certain portion to be determined through competitive bidding. The design of the licence charge is intended to ensure that there is an appropriate level of risk-sharing between the Government and operators, given the nature of new RTS lines which will start off with relatively high fixed costs but whose revenue will steadily improve over time. This element of risk and reward-sharing in new licences is a key feature of the new RTS licence, and would enable LTA to also pool the licence charges received and decide on the best use of this money to improve the network capacity, such as purchasing additional or replacement trains.

To allow LTA to collect a licence charge, a new section 13A of the RTS Act has been added and related amendments will be made to the LTA Act to provide for the creation of a special purpose Railway Sinking Fund for the licence charges or grants to be paid into. The Sinking Fund will be used to fund any capital operating equipment such as trains, signalling systems and other operating assets for operating the RTS. The Sinking Fund monies will be ring-fenced for the purposes of purchasing new or replacing operating assets to meet demand.

Madam, as new lines are added, it is important to ensure that the rail infrastructure is properly integrated with overall transport facilities and surrounding developments. Each station is in effect a transport node through which thousands of commuters pass each day. To effect this, we have added a new section 11A to set out the general considerations to achieve an adequate, sustainable, safe, secure and integrated railway transport system in Singapore. Section 15 and section 18 are also amended for the purpose of ensuring integration of

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transport services and facilities as well as enhancing passenger services, in line with our vision for a people-centred land transport system.

The next part of the Bill deals with the continuity of RTS operations. Section 15 is amended, and new sections 16A and 16B are added to safeguard the continuity of RTS operations and provide further clarity and transparency to the conditions which LTA may impose. These include operational obligations to operate extensions and stations that are added to existing lines, facilitating the transfer of contracts and manpower in the event of transition from one licensee to another, the surrender or assignment of licence and the voluntary winding up by licensee.

The new Part IVA provides for Railway Administration Orders, allowing the Minister for Transport to appoint a different person to manage the company to ensure the security and reliability of the railway system, and to allow the transfer of undertakings from an existing licensee to a new licensee. This can be effected if the existing licensee is unable to operate the railway, such as in cases where there are insolvency concerns or for reasons relating to safety, security or public interests. This is not unlike the provisions in the Civil Aviation Authority of Singapore (CAAS) Act where the Minister for Transport is empowered to make a special administration or other orders if there are serious contraventions of the airport licence or of the Act or if the licensee is unable to pay off its debts.

Section 19A of the Bill provides an alternative to regulatory action in the event of default by a licensee. It allows LTA to make provisional orders before securing compliance with the conditions under the licence. This gives the licensed operators an opportunity to be heard and allows them to rectify minor breaches or contraventions.

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To enhance security, there is a need to augment LTA's powers and empower it to impose licence conditions, issue, approve or modify codes of practice and issue directions relating to the security of persons on the railway system. Section 23A is also added to empower authorised personnel appointed by the LTA to search baggage and property brought into the railway premises.

Mdm Deputy Speaker, the Government is committed to investing in and developing the rail network in a timely and financially sustainable way. The proposed amendments are necessary in order to effect the new financing framework, to allow for greater contestability to be injected into the RTS industry, as well as to ensure security and continuity of the RTS operations.

Madam, I beg to move.

Question proposed.

4.28 pm

Dr Lim Wee Kiak: Mdm Deputy Speaker, thank you for allowing me to participate in the debate of this Bill.

The ancient civilisations were all situated where transportation facilitated their growth. It is no wonder why most centres of civilisations are near major rivers, deltas and coastal regions where transportation by water makes rapid growth and development possible. Transportation is a major enabler and catalyst for growth of all activities. Hence, it is important that our transportation infrastructure development should lead our national development rather than lag it. I support this Bill as it enables our Government better control over our rapid transit infrastructures so that development can be hastened to lead and not wait for commercial viability for too long before developing new rapid transit lines.

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Our Government has done well for the past 45 years in providing for the basic needs of the people such as security and safety, housing, education, healthcare and transportation.

These are the basic requisites for continual stability, growth and prosperity. The Government expenditure on security and safety, healthcare, education and housing is very visible and very much appreciated by the people. However, the expenditure on transport infrastructures seems to be less visible and we often hear people lamenting high public transport fares. The Government’s position of not subsidising operating costs of our public transport and the reported annual profits by our public transport operators have also reinforced the public views and perceptions that the Government is doing less for transport than other key areas. I would like the Minister to clarify the following:

(i) Over the past 25 years since the first MRT has become operational, how much has the Government invested in developing our MRT network? How will this change with the new amendments?

(ii) What is the current cost to the Government in maintaining and providing the MRT services to the public? With the new financial arrangement, will this cost be increased or reduced?

(iii) What is the public's share in paying and maintaining the MRT system? Is the total revenue collected by our two existing MRT operators sufficient to offset the operational, assets and parts replacement costs?

I support the principles highlighted in the Bill on rail financing framework and the network-based financial evaluation approach. I also support injecting greater contestability in the rail industry by shortening the licence periods so that the incumbents do not get too comfortable

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with a long 30-40 year licence. However, I do have concerns arising from contestability.

Competition in principle is good as long as commuters benefit from lower fares and better services. We are all worried about competition that becomes irrational and that may end up with commuters paying more. Will competitive bidding become destructive just like the telcos bidding for EPL screening rights? Will public need to pay more if the bid prices go up?

One of the virtues of our public transport system is that it runs on commercial terms with commercial efficiency. Because our rapid transit system is not run by a Government agency which may become overly bureaucratic and inefficient, the current system runs well to maximise utilisation. The danger is the over-utilisation of assets to maximise returns and the neglect of maintenance. Long-term planning and development may also be compromised in view of the shortened licence period.

By Government taking over the assets as well as procurement, it will solve the latter, but will the replacement and upgrading now become slower, because it is not commercially driven?

Another area of concern is the quality of service. Our current public transport operators are in a privileged position. They are like the big US banks, and are too important for the Government to allow them to fail. Knowing this fact, the management may take more risks than it can handle and also cut cost to maximise returns. Will service quality drop since they know the commuters do not really have any other choice or options? What is the safeguard against unrealistic bidding and service failure?

Lastly, this Bill also spells out security arrangements. It empowers the public

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transport operator with the right to check all bags and properties carried by the commuters on the system. I guess public will be concerned about the following:

(i) When will all bags be checked on our rapid transport system?

(ii) Will the operator disallow commuters to bring drinks and food onto their trains? Can the operator unilaterally enforce such actions since commuters now face a fine if they get caught drinking or eating?

(iii) Will the current amendment be applied to existing operators? What are the expected additional security measures that existing operators will be putting in place with this amendment?

(iv) Will commuters pay more due to increase in security costs?

In conclusion, I support the visions spelled out in the Land Transport Master Plan and I look forward to the doubling of our current rapid transit system by 2020. The amendments spelled out will facilitate and enable faster development of our rapid transit system, so all Singaporeans can continue to enjoy a cheaper, faster, better and safer ride.

With that, I support the Bill.

4.34 pm

Ms Sylvia Lim: Madam, there are some provisions in the Bill which are aimed at enhancing security on public transport. I take it that this is a response to the recent security breach at SMRT Changi Depot and a belated realisation that both the Government and the public transport operators (PTOs) need to take a more active role. This is overdue.

On a separate point, I have a concern about the increased cost burdens being placed on the PTOs by this Bill, in particular clause 5. Clause 5 amends section 15 of the Act to provide that the Land Transport Authority can impose

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more conditions on the licensee of the railway system, such as to maintain infrastructure outside the MRT stations, like overhead bridges, cycle stalls, carparks and even drainage systems. The rationale stated is that such infrastructure can be considered to enhance the transport node. However, is it justifiable for the Government to pass the responsibility of maintaining such infrastructure to the PTOs? How much cost would the PTOs incur to maintain such infrastructure? If the PTOs have to incur large cost to do so, will they be tempted to cut cost elsewhere, leading to a drop in standards of delivery to commuters? Since such infrastructure is of general public use, should the Government not maintain them, instead of literally passing the buck?

4.36 pm

Assoc. Prof. Dr Muhammad Faishal Ibrahim (Marine Parade): Mdm Deputy Speaker, the amendments proposed in the Rail Transport System Act (RTSA), in my view, represent another forward-looking approach to put in place a holistic transport framework. This is important as with Singapore's small size as a city state, we need to optimise the use of our land use resources. With the expected future expansion of the rail lines, the challenge is to manage the space within our land-constrained city state through careful and considerate planning bearing in mind our current resources and meeting the travel needs of our growing population.

I am pleased that the Ministry is committed to expanding the rail network, and is mindful of the high costs of building and maintaining the infrastructure. The benefits these new lines bring in serving and connecting the less mature corridors are tremendous as it would bring more new commuters to make use of the expanded network and drive the economy further.

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It is in this spirit that I would like to state my support for the Ministry’s proposal towards a network-based financial evaluation approach to expand our rail network. In taking over the ownership assets of the network holistically, it provides LTA with greater room and flexibility to manage our rail transportation system, strategic asset and to expand the rail network further in the future.

Mdm Deputy Speaker, in doing so, therein lies impending issues and concerns in the details of this proposal. As such, I would like to raise the following points during this reading for further discussion.

Firstly, has the new rail financial framework been implemented elsewhere? If so, how successful has this model been and whether this approach has attracted the right strategic investors and benefited the commuters?

Secondly, with the shorter rail licence periods proposed, LTA will take over the ownership of operating assets, and lease them at an appropriate charge. The first question that came to my mind was what will be the impact of the new framework on the existing operators who run via the existing framework? Are there options available to them to operate under the new framework?

In addition, with a shorter licensing period under the new financing framework, there are issues being raised on how the LTA will ensure that the new operators preserve and retain the competency and competitiveness in operating and maintaining the system and its fixed assets. This is especially so during the transition period from one operator to a new one.

Thirdly, the intent to shorten the licence periods of the rail operators would

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also mean injecting greater contestability in order to enhance efficiency and maintain cost competitiveness and enhance service standards to benefit commuters. However, will greater contestability in the RTS industry cause operators to bid aggressively to operate the service? Should it lead them to financial distress due to failure in business and investments, would the Government have to bail them out?

The purpose of LTA owning the operating assets was to realise an adequate, sustainable, safe, secure and integrated railway transport system in Singapore. However, I would like to know if the future expansion of the rail network will consider integrating the bus system into the framework. This is imperative as the two networks, if integrated, will fully optimise the economies of scale of the transport network and ensure greater connectivity and efficient travelling time for the majority of Singaporeans.

Mdm Deputy Speaker, the next issue that I would like to raise is that in land-constrained Singapore, it would be imperative if we fully optimise the space of our assets. I would like to know if the licensing of our rail network includes the operation of other land uses such as retail space at the RTS facilities. Besides adding to the vibrancy of the RTS facilities, I feel that this is important as the other land uses form an integral part of our integrated land use approach and, thus, would help to enhance our optimisation of the use of land resources in Singapore. In addition, this may attract a greater pool of competitive investors to bid for the licences as they are motivated to reap the benefits of operating a rail network and the potential returns from the retail space and other uses.

A related amendment to the Act is the creation of a Sinking Fund to procure any capital equipment such as trains and other operating assets for the operation of the

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RTS. I would like to know if LTA would make the guidelines and processes on the use of the Sinking Fund transparent to ensure greater accountability in its use to ensure its competitiveness in managing the whole rail network.

Mdm Deputy Speaker, in summary, the proposed amendments will provide for LTA to bring Singapore to the next phase of our transport and urban development. I am certain that it would drive the competitiveness of our economy and raise the productivity of the people. The key concern of the people as always would be the bread and butter issue of whether these amendments would enhance their quality of life. I would like to strongly encourage the Ministry to constantly communicate its purpose to the people to understand their needs, how the amendments will benefit them and bring Singapore to the next level of development.

Mdm Deputy Speaker, on that note, I support the Bill.

4.42 pm

Assoc. Prof. Paulin Tay Straughan (Nominated Member): Thank you, Madam, for this opportunity to raise my thoughts on this Bill.

Specifically, I would like to draw attention to the section of the Bill which augments the LTA’s power relating to security of the rapid systems. My main concern with this Bill is clause 12 which introduces a new section, section 23(A).

Section 23(A), which relates to the security of rapid transit systems, empowers an authorised officer to inspect and search, without giving any reason, the belongings of a person on the railway premises. An authorised officer may also require any person who refuses to permit his belongings to be inspected and

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searched to leave the railway premises. Any person who refuses to comply or to leave the premises at the authorised officer’s instructions can be fined up to $1,000. This clause grants an enormous amount of power to the authorised officer. While I appreciate the importance of and the need to ensure security in our current climate, I am also concerned that Singaporeans should continue to enjoy personal privacies and be able to utilise public transportation without concerns about over-enforcement. When I read this Bill, I was reminded of my personal experiences during the SARS period, where over-enthusiastic enforcement of temperature screening by over-zealous personalities made it extremely unpleasant to enter certain buildings.

My question is focused on the training of these empowered officers in recognising perceived threat, and what safeguards are in place to protect innocent individuals. I strongly believe that there must be a good balance between issues of privacy versus protection of strategic facilities. Both are equally important, especially in public transport which facilitates our everyday life and which all Singaporeans depend on. Can the Minister assure us that with this additional clause, privacy and respect of innocent Singaporeans will be protected? And that innocent passengers will not be treated as potential suspects? Will the Minister consider adding a sub-section that states that an authorised officer exercising power under this new section 23(A) is acting under "reasonable suspicion"? This will serve to assure Singaporeans that the normalcy of everyday life will not be disrupted, and it also offers reprieve to the innocent who may be adversely affected.

Mrs Lim Hwee Hua: First of all, I would like to thank the Members for their support of the Bill. As the questions have

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been raised under various categories, allow me to address the questions under the following broad categories: first, the role of Government in public transport; second, the impact on the operators; third, the impact on the commuters; fourth, some of the specific issues under the new rail financing framework; and fifth, the all-important issue of security.

Dr Lim has raised many questions on the role of Government in public transport. Let me just recap that based on the 1996 White Paper principles, the Government would bear the capital cost of transport infrastructure, including the first set of operating assets. Government has also committed to help pay for the inflationary cost increases for replacement of operating assets, so as to help to keep MRT fares affordable.

Madam, these principles would remain unchanged with the new rail financing framework. Maintenance and operating costs will continue to be borne by the public transport operators. Therefore, the cost burden on the Government will remain unchanged under the new framework.

The difference, however, under the new arrangement is that LTA, instead of the operator, will now own the operating assets and be responsible for the replacement which will be funded from the to-be-created Railway Sinking Fund and, in return, the operator will pay for the use of these operating assets through a licence charge.

Dr Lim has also asked about Government's investment and expenditure in the transport infrastructure over the past 25 years. Inclusive of the Circle Line, Downtown Line and Boon Lay extension, Government has spent over $33 billion in the past 30 years to build up the current rail network. Regardless of the new rail financing framework, the Government remains committed to invest in the

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development and expansion of the rail network which will see close to a doubling of the rail network in the next 10 to 15 years, with new lines such as Thomson Line, the Eastern Region Line as well as Tuas extension and the North South Line extension to Marina South. The objective of the new framework is to enable the timely implementation of future rail lines in a financially sustainable manner.

Madam, let me now move on to the impact on operators. The new rail financing framework will be applied to new licences, starting with the Downtown Line operator licence. As for the existing licence operators, we will allow the licences to continue to run on the current licence terms until expiry unless there is mutual agreement to replace the existing licences with new licences.

Dr Lim has also asked about the allocation of the costs in maintaining the MRT system. As I mentioned earlier, the operating and maintenance costs of the RTS system will be borne by the operator and recovered from fares, as well as other non-fare revenue such as commercial rental and advertising collected by the operators. In assessing our rail infrastructure, the Government takes into account the economic benefits and costs as well as the financial sustainability of the lines. On this basis, the total revenue collected by the operators should be sufficient to offset the operating and maintenance costs borne by the operators.

Next, moving on to the impact on commuters, specifically whether there is a need to raise fares. Dr Lim has asked whether the competitive bidding would become destructive and cause the public to pay more. Madam, let me assure the House that fares will not be affected by the transition to the rail financing framework. Public transport fares will continue to be regulated by the Public

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Transport Council with the fare adjustment formula based on the wider macro-economic indicators such as national inflation and wage increases and, therefore, will have no bearing on the specific operator's costs.

Let me address now some of the specific questions raised with regard to the new framework. The first relates to contestability. Let me elaborate just a bit more about the safeguards against overbidding. In structuring the tender, we will place emphasis on both the quality and the financial value and sustainability of the tender proposals. This will ensure that the tender bids are competitive and, at the same time, realistic and provide us with the assurance that the operator that wins the tender will be able to ultimately deliver the service as expected.

The service standards on the RTS will continue to be prescribed via the Operating Performance Standards (OPS) in the RTS licensing regime. There will also be stringent maintenance requirements on the operator and key performance indicators that they will have to fulfil so as to ensure that the operating assets remain in good working condition at all times. LTA will also maintain pre-emptive regulatory oversight by closely monitoring and enforcing compliance of the operators' operating maintenance and financial performance.

And, finally, should any operator fail in spite of all these safeguards, the Government has the powers to step in to terminate the operating licence and take the necessary actions to ensure that the RTS network continues to service the needs of our commuting public.

In arriving at this new rail financing framework, we have closely studied models used in many other cities around the world such as London and Melbourne where rail licences are similarly short. For profitable lines, the operators will bid in

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the form of an annual contract payment to the government. Likewise, for lines which are expected to be loss making, the government will ask the operators to bid for the subsidy which they will require from the government. Typically, there are also risk-and-reward-sharing mechanisms in these licences.

Our financing model has been adapted from the lessons learnt around the world to suit our own local conditions and cost principles between the Government and the operators. The framework has been set up to maximise the benefits of contestability with sufficient regulatory oversight and safeguards to ensure the long-term sustainability of our system.

Specifically on the questions of the Sinking Fund: the sources and the use of the monies in the Fund have been spelt out clearly in the Bill. LTA has the statutory obligation to ensure that all monies meant to enter this Fund are separated from the other general monies held by LTA.

Dr Lim is concerned that with the Government taking over the ownership of the assets that replacement and upgrading might be slower or might suffer. I would like to assure him that this will not be the case because as asset owner, LTA will be responsible to monitor the status, the serviceability and the adequacy of operating assets. It will put in place an asset management framework to ensure timely and cost effective replacement and upgrading of assets. And by taking on ownership of all the RTS operating assets, LTA will be able to undertake integrated and holistic long-term planning for the entire RTS network, including planning of new lines, and effect the timely purchase of more assets such as trains to enhance the carrying capacity of existing lines. LTA is also in a better position to plan for the long-term needs as it will be privy to much of the planning data as part of its strategic transport planning function.

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As of today, the operators are already responsible for the operation and maintenance of the operating assets and under the new financing framework, this responsibility will not change regardless of the ownership. As I said, LTA has in place a rigorous set of asset management requirements to be complied with by the operators, failing which they will be penalised. But, really, the interests of the owner and the operator are closely aligned. The operators, who have to run these trains 18 to 19 hours a day, seven days a week, 365 days a year, will continue to have a huge stake in ensuring that they continue to do a good job in maintaining the assets for their own reliable rail operations.

There is certainly scope for integration considerations. In fact, the Bill provides for LTA to take into account system integration when exercising its powers and statutory functions. LTA, as Members would know, has taken over the role of the central bus network planner and, therefore, can take a holistic approach when planning the bus and RTS networks. Network efficiency will be optimised from the commuters' viewpoint by ensuring seamless transfers and shorter overall journey time.

Madam, let me now move on to the last section on security, a point which several Members have raised. Dr Lim has asked when all bags will be checked. In a normal situation, bag checks will be conducted on a random basis. However, if there is heightened alert, both the deployment of transport security officers and the frequency of bag checks will be increased. He also asked whether commuters can bring drinks and food onto the train. They are generally allowed to bring drinks and food onto the train but they are not allowed to consume them. Under the RTS regulations, the operators have the right to prevent any items which

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they deem to be a nuisance or are offensive to other commuters from being brought into the train. An example of this will be durians.

Let me now move on to the other aspects about whether the amendments to the security provisions would be applied to the existing operators as well. Yes, this will be the case. In fact, as of today, the operators already have in place extensive security measures on the ground and this amendment will not add undue additional security burden on the operators. In any case, fares, as I have mentioned earlier on, are regulated by the PTC and commuters will not be required to pay any more for any increase in security costs.

Assoc. Prof. Straughan has asked whether there are safeguards in place to protect innocent individuals from the effect of this new section. Let me assure her that there are currently safeguards in place. Firstly, bag checks are conducted in the open view of the public and in areas which are under the surveillance of CCTVs. Secondly, transport security officers are required to document details of the checks conducted: the time, the date, who they have checked. Thirdly, LTA, the Public Transport Security Command (TransCom) and the PTOs themselves also conduct regular checks and audits on the transport security officers to ensure that they are performing the duties correctly and professionally. I should add also that the transport security officers who conduct bag checks at the RTS premises are licensed security officers who have undergone the Security Workforce Skills Qualifications' training and certification programmes, so they are sufficiently well-trained and will be professional.

Let me now move on to Ms Sylvia Lim's comments. I would like to correct a point that she has asserted. Firstly, I would like to state that the legislative

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changes are not a belated response to the breach at the Changi Depot as asserted by her. In fact, since 2004, the provisions have already been in place. Transit security officers have already been deployed at MRT stations and bus interchanges since mid-2004 to enhance security and to deter potential attacks. The reason we are making these changes is really to ensure that emphasis is given to powers granted to authorised persons to conduct bag checks at MRT premises. It also serves to highlight the serious nature of these offences and to this end, the maximum penalties for these offences have also been raised from $500 to $1,000.

As to whether the enlarged coverage will lead to increased cost burdens: this is currently the case where the PTOs are already maintaining these facilities, so there is no real material change except a formalisation of what is already in place. These facilities that I mentioned are really integral to the connectivity to the station as they provide access to the commuters. It is therefore justifiable for the PTOs to maintain them. In the event that there are new requirements, then the inter-agency Public Transport Security Committee will study carefully the cost implications and the allocation of costs across the public agencies, the operators and the other stakeholders.

Madam, I believe I have answered most of the questions.

Assoc. Prof. Paulin Tay Straughan: Thank you, Mdm Deputy Speaker. I am sorry to belabour this point but I thought it was important to follow up on the bag checks. We live in an era when we are so used to bag checks now but still I think the way it is done is so important. I want to ask the Minister if the proposed checks will be random, where every hundredth person will be checked, or based on some

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kind of profiling. That is what I am concerned about. Generally, we live with these kinds of inconveniences now because we accept that we are not picked out unnecessarily. There are two modes of doing bag checks. Sometimes, it is just random and you know that every fifth or tenth person would get checked, and so you just play along. Or sometimes, checks are done for every person, and so everybody complies to facilitate the process. What I am worried about is if there is some kind of selective profiling that goes on behind the scenes. That is where we need to handle it with sensitivity. The officers must be trained adequately. As the Minister mentioned, checking would be done in public so public humiliation is something that I am very concerned about.

Mrs Lim Hwee Hua: Madam, I take the Member's point about the need for checks to be done professionally, and indeed this is the case, and that is why the officers would be sufficiently trained to conduct these checks in a professional manner. As to the frequency, as I mentioned earlier on, under normal circumstances, this will be conducted on a random basis. But if there is heightened alert, the pattern will necessarily have to be changed. I would like to assure her that there are safeguards in place, including the audits.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. – [Mrs Lim Hwee Hua].

Bill considered in Committee; reported without amendment; read a Third time and passed.