APPROPRIATION BILL

Order read for resuming adjourned debate - [9th November]:

Mr G. A. P. Sutherland (Nominated): Mr Speaker, Sir, I had hoped that the secondary armament would be fired at a later date, but with all this rushing to speak, I might as well get started. Mr Speaker, Sir, I should like to state that, in view of the increasing heterogeneity of Parties on the Opposition side, such opinions as I would voice now are free of the influence of any party politics and I am expressing no views but my own.

Sir, as a banker, I have made it my business in the past to try to understand something of government finance, and I found little to surprise me in the speech of the Hon. the Financial Secretary, which though it emphasised that the Colony's financial position was sound, was nevertheless something of a jeremiad. This is, of course, in the best tradition of Financial Secretaries, and the present incumbent is as jealous a watchdog of government finance as any we have seen. His predecessor uttered grave warnings about the necessity for cutting down on expenditure in Government departments, and I trust the present Government will make every effort to live within its means. Certainly from the number of amendments that appear in the Estimates, it would appear that the Opposition is going to try to persuade the Government into this way of thinking.

In the figures given on pages 10 and 11 of the Sessional Paper No. Cmd. 28 of 1955 of "Personal Emoluments" and "Other Charges Annually Recurrent" for Education, Medical and Social Welfare, the rise is steep enough in all consciousness. Yet the Sessional Paper states that during the next five years expenditure on those services is expected to increase with even greater rapidity. This point was given further elucidation by the Hon. the Financial Secretary in his speech, and it appears that even after allowing for the streamlining of the Government machine as a whole, we shall be faced, on the present basis of revenue, with an annual deficit in the region of $40 million in five years' time. Now this is indeed a sobering thought and however unpalatable it may be, it seems obvious that increased taxation is both necessary and inevitable. I do sincerely hope that the attitude of all right-thinking citizens will be a sympathetic one towards Government in its problem - a difficult problem indeed - with the gulf between revenue and expenditure already wide and likely to widen further as the years pass. The problem indeed seems almost to be insoluble. That more money annually must be spent on education, health, and social welfare goes without saying, and someone must foot the bill. Nevertheless, care must surely be taken to see that we do not interfere with business as a whole, and that capital is not scared away from the Colony.

I trust the House will take heed of the Financial Secretary's warning that the greatest care must be taken not to let the Colony's reserves run too low, and note his observation that the market for local loans is not unlimited in capacity. The market for local loans is indeed the very reverse of unlimited in capacity. There have been occasions recently when the City Council have tried to raise money in local loans, and had it not been for a substantial demand by the Central Provident Fund of the Federation Government, the loans would have met with very poor success indeed. Now, one of the reasons for this, Sir - I could give many - is that there just is not a great deal of money around seeking this particular type of investment.

To me, one of the most interesting things about the Hon. the Financial Secretary's speech was the uninhibited way in which he told us of the various proposals for increased taxation that had been considered and rejected. We also know, at least to some extent, what we may expect in the future. One would expect a Government, Socialist in background, to introduce increased taxation on the upper income group. I do not quarrel with the principle of placing the burden of taxation on the shoulders of those who are best able to bear it, but no effort should be spared to increase the efficiency of the Income Tax Department to make certain that those people who are capable of paying it do pay it. That there is tax evasion on a large scale seems highly probable. I certainly have heard plenty of talk about it in Singapore over the last five years. The curious thing, Mr Speaker, is how people's moral standards change when it comes to paying Government its just dues. I know quite decent people - you can call them businessmen - who would shudder at the thought of dishonouring a business contract but would do almost anything and go to any lengths to evade paying their tax. All is fair apparently in love, war and dodging income tax! And we all know, Sir, the type of person, usually female, who boasts of having diddled the Customs! While it is good to learn that proposals for joint action by the Governments of Singapore and the Federation "were discussed with cordiality and understanding" - the phrase used - at Kuala Lumpur, it is noteworthy that the Federation Government effectively threw a spanner in the works. In this way, we may see the shape of things to come. I accept unreservedly the Financial Secretary's explanation of why common action in respect of income tax is regarded as essential, but I trust that we are not going to be ruled from Kuala Lumpur.

Now, Sir, it is only natural that one should feel relieved that the Budget proposals contain no provision for increase of income tax, but that is merely a brief respite, as the Financial Se- cretary has been at pains to make clear. I have no complaints about the indirect taxes that have been imposed, but I must confess to being astonished that tobacco has escaped. To pass up $19 million of revenue, or potential revenue, when one is scratching around for means of meeting a hefty deficit is, to my mind, quite incomprehensible. There is, to me, something distinctly humorous about the pomposity of the phrase "the Council of Ministers had in mind that intoxicating liquor was, in fact, a luxury. It could not, by any stretch of the imagination, be called a necessity." Well, there are some who would disagree with the Council of Ministers! Now, Sir, I have all the vices - I drink whisky, I smoke cigarettes and - I sing in my bath! But I am as firmly of the opinion as the Council of Ministers is about liquor (why gin escaped, I do not know!) that cigarettes can, in no circumstances, be called a necessity. In the United Kingdom smokers have to pay heavily for the habit, and I do not see why the man-in-the-street in Singapore should not pay a little and help to shoulder the burden by this simple method of indirect taxation. I do not seek an elaboration of Government's brief statement - "It has been decided that it would be undesirable at the present time to increase the tax on cigarettes by even a small amount." I can guess what is in their minds, and I can only regard their attitude in this respect as timorous.

Mr Lim Choon Mong (Serangoon): Mr Speaker, Sir, the Hon. the Financial Secretary has informed us in his Budget speech that the expenditure for 1956 will exceed the revenue and that the deficit next year is going to be real. This kind of warning from those who prepared previous Budgets has always been too often repeated, and naturally enough we would like to give the warning the discount it deserves. Even then, no matter whichever way our belief is going to be, the fact that we have to face now is that indirect taxation in a number of commodities has increased. We will have to work from the angle that we have just a limited income and how best to spend it in the interests of the majority of the people. To achieve this aim, we must remember that although there are many claims for development in various directions and from many parts of Singapore, we must sort out what is the most important and what will give benefit to most people, in preference to schemes that will serve an exclusive number of people.

For instance, if we were to decide whether there should be lighting for a place like Goodwood Hill, where the people travel in large and beautiful cars - they do not, most of them, walk late at night - or lighting for Serangoon Gardens, where the population is denser and more people travel on foot and bicycles, then I think we will have no hesitation in saying that the latter category is more deserving. Of course, money in that direction would have to be voted to the Rural Board. This is just like making a decision with a limited amount of money, whether we should buy cosmetics for our girl or buy a pair of specs for the shortsighted one! You will always come to the right decision, and not throw your money on luxuries. Now, I always believe that schemes like lighting of Goodwood Hill is one that can wait and must wait, and that any money that we can make use of must be diverted to other schemes that are more important and urgent.

Again it will not be out of place here to mention that, in an austerity programme, those in the Government should set a good example in the need for economy. From the Budget you will see that the Ministers amongst themselves have appropriated sums ranging from $2,000 to $10,000 as entertainment allowances. Drinking champagne and having satay parties are part of the necessary functions of Ministers, but at a time when there is going to be a deficit in the Budget and the whole city is fraught with strikes and unemployment, the cutting down of such parties to a minimum would not be a bad idea. I would rather say that a few Aspros, which are cheaper, might be more helpful in bringing about a more prosperous and peaceful Singapore.

This is a Labour Front Coalition Government, and we are constantly reminded that it will carry out its Socialist programme. It has promised the people interest-free loans for those who want to build their own houses. As one who might like to take advantage of such an offer, I looked diligently through the pages of the Budget, but, alas, the long hoped-for Government interest-free loan was not there. I was disappointed. That hope, raised so high by the Government, crashed. However, this is not only a bad omission, but there are other events which smashed that crashed hope to smithereens. The Hon. the Financial Secretary has had a word of congratulation for the Rural Board for raising more revenue. Let me acquaint the House of one method of achieving this. Recently I have received many representations from clerks working in the Government, the City Council and the Services, who happen to own houses in Serangoon Garden Estate. They do not get interest-free loans, but they have to pay interest, and it will take them about 15 years to repay the loans by monthly instalments, and yet the Rural Board has deemed fit to exact a higher tax from them by increasing the annual value of their houses. The ground for such increases seems to be that a few houses were let out to Service personnel at higher rentals. Owner residents protested to the Board, but their pleas were ignored. It seems to me that in that locality the innocent must be punished together with the guilty. It is important that wage earners should be encouraged to own land and houses, but if they reckon that they have to pay more in the way of tax when living in their own houses than the rents which they paid for their old pre-war houses, then where does the encouragement come from? Your slums will be harder to clear up, and, of course, there will be more savings for the Public Works Department. That probably will suit the Government in providing excuses for holding up further development plans.

The tune that is being played now is "no money", and playing that tune you might as well go the whole hog and examine how this tallies with the Budget. If you refer to the Head: Minister of Health, you will discover that large sums of money are allotted for the purposes of alterations of hospitals. We would like to ask just one question on this. Will such alterations mean a gain in the number of bed space in the hospitals? As far as I am aware today, there have been no such increases in the past, and I do not expect any increase in the future. Instead, you will probably find that the ward is just changed into another shape, and air-conditioning included in certain parts of the ward -

The Chief Minister: Wholly erroneous.

Mr Lim Choon Mong: I say here that the people of Singapore are not fastidious. The masses here have endured the heat from time immemorial and they prefer such heat to artificial cooling. In all probability, they would suffer from the discomfort of cold, just as I often do in this Assembly, which is air-conditioned! The first essential of a hospital is to cure, and it is highly preferable that the money to be used for alterations should be utilised to build new district hospitals. The sum involved in this instance is in the region of about $2 million, with no increase in bed space. That money, I should say, is just wasted. Talking about district hospitals, you will have one going to be built next year with a token of $10. Nothing concrete in that.

Now talking again of savings on expenditure, Government should always make it their business to see that whenever appointments are made, they should be absolutely necessary. I quote you another instance under the Head: Ministry of Health. It would appear, I think, that seven Radiologists are to be appointed. At present you have two. But that hospital has only one General Duty Medical Officer. The other posts are still not filled and you are voting money for new posts. Why is that necessary? I always think that in any set-up - take the case of the Police - if you have six constables, then you have one corporal. If you have so many corporals, then you have one inspector, but you cannot have seven inspectors and one lance-corporal. They do not need so many inspectors to control one lance-corporal.

Now let me now turn to the Ministry of Education. As a school-master I am drowned daily by pleas from parents wanting to get their children places in schools, primary as well as secondary. It is obvious that Singapore wants more schools - primary as well as secondary. They want more vernacular schools, and they want more trade schools. Now it is the Government's responsibility, in drawing up the Budget, to see that this important aspect of work is tackled. The general level of education of the masses in this country must be raised, and I should say that the greatest treasure that a nation can possess, especially one like us that is striving towards self-government and independence, must be to create a very high percentage of well-educated people. Secondary as well as higher education is what we must have if our dreams for early Malayanisation of the services is to be realised. More schools, more technical schools, schemes and assistance for training within industries are lines which should be adopted as insurance schemes against future unemployment. But what do we find in the Budget? No provision for secondary schools in 1956. That is a very grave omission.

Even in the direction of social services, what do we find after all the shouting by Government at the top of the roof? Do they do a little more for the under-privileged? We find that the present elected Government is even worse than the previous colonial Government. Whereas a colonial Government had between 1954 and 1955 increased its social service assistance by 50 per cent to youth organisations - and, in this instance, it means the boys' and girls' clubs catering for the under-privileged children of Singapore - the present Government is happy with the figure for 1955, ignoring completely the fact that the number of clubs catering for such youth is about treble. It is very well to sit in an air-conditioned room and claim yourself to be a Socialist fighting for the uplift of the under-privileged and the down-trodden, but I would rather invite you to come out and work amongst them. I am the President of the Federation of Boys Clubs, and I voice the dis- satisfaction of 40 times 400 youths of Singapore.

On community centres, we are promised another three at a cost of a token $10. I know what community centres are. I work in them, take a very active part in them, but I believe that it will be more beneficial to support communities, to help them build their own centres,- assisting them with sums ranging probably from $10,000 to $20,000, rather than to build one that will cost $150,000, if it were built.

Now, if care had been exercised in the matter of expenditure, I believe that there would not have been the necessity of additional taxation. At present the Government is not only imposing new taxes on liquor, petrol and estate duty, but it is also holding the threat of further taxation over the heads of the citizens of Singapore. I do not know what tactic this is. Is it to give a boost to traders in luxury commodities by telling them what items will probably be taxed in the middle of next year or somewhere in between? If it is, then it has produced excellent results. I am personally aware of many sudden decisions to acquire new cars, new radios and so on. If this information is to assist the gathering of more revenue later on, then I must say, from what I have already mentioned before, that it has received its first setback. However, coming back to this uncertain tax problem, it will definitely create a rather unstable state of affairs in the local market, and probably it will lead to hoarding and placing of unnecessary orders on luxury lines.

On the question of taxation on petrol, I must point out to the Government that this commodity is used directly by the owners of cars and lorries, and indirectly paid for by the public who travel in vehicles using petrol, or farmers hiring lorries to cart their feedstuffs back to their farms. Now if the fare and the cost of hire of lorries are going to be increased because of the increase of tax on petrol, then this form of taxation will not he placed on the shoulders of those who can best bear it. Well, you have initiated this move. I would welcome assurances -

Mr Speaker: Order, please, Mr Lim Choon Mong. I have not initiated the move. You are addressing your remarks to me.

Mr Lim Choon Mong: The Government have. May I correct that? I welcome assurances that steps will be taken to protect the common masses from increased fares and cost of hire. After all, if the fare is to be increased by five cents, it may mean very little to you. It may mean very little to me. But to a person who is earning $100 a month, it may mean either cake money or no cake money to his child for that day. Whichever way you look at it, indirect taxation will affect the poor man to a greater or lesser extent. I do not say that there must be no taxation, but I would rather advocate increased personal income tax - and do it as fast as you can. That will be the best method.

Now, after speaking along these lines and looking through the Budget carefully, I think that it needs a lot of improvement - a great deal more.

The Chief Minister: What?

Mr Lim Choon Mong: Pruning of expenditure!

The Chief Minister: What?

Mr Speaker: Order, please.

Mr Lim Choon Mong: More money for development schemes that will be beneficial to the people.

Mr M. P. D. Nair (Seletar): Sir, to me the most disconcerting fact emerging from the Hon. the Financial Secretary's disclosure of the estimated Assets and Liabilities is that we are faced with a possibility of a capital loss to the extent of $10.6 millions in the event of our realising the investment representing the Special Reserve Fund of $106.6 millions. The depreciation in the value of the long-term securities in which the moneys are invested, amount to more than ten per cent of the actual cost, and Sessional Paper No. Cmd. 28 of 1955 does not indicate the extent to which other long-term securities have fallen in value. I am sure, Sir, that we have learnt a costly lesson in allowing our hard-earned and much needed surpluses to be invested abroad while we suffer the reputation of a capital-hungry country in other parts of the world. I believe, Sir, that Government should set an example in the future by allowing its surpluses, temporary or otherwise, to be invested in this, and this country only. Government's need in this connection is of paramount importance. It is a matter for regret and deep concern that more than 45 per cent of the assets of the banks operating locally are invested abroad - I am quoting from the report of the International Bank Mission - and a good number of institutional investors, such as insurance companies, still continue to invest a substantial proportion of their assets in foreign countries. The outward look approach of the Government should be changed to one of inward look in matters of disposition of investible funds. Only then could we place ourselves in a position to appeal to the private sector of our economy to act in the national interests in these matters.

Sir, considering the future prospects of surpluses in our budgetary operations, it seems to me that they are unlikely to be of such a magnitude as to create inflationary tendencies if they are invested locally by means of short-term deposits in our local banking institutions. No doubt the management of Government's monetary affairs will be greatly facilitated by the proposed Central Bank when it comes into operation, but until this happens, wiser management would be necessary. The time has come, Sir, to consider realising some of our external investments for social development, such as housing, and for Government partnership in local industries.

Sir, I deplore the inordinate delay in presenting the accounts of the Colony for the year 1954 for scrutiny by the Public Accounts Committee. Members are therefore precluded from making constructive comments on the Budget before the House, and they are unable to say whether value has been obtained for the money voted in the past for expenditure. I am wondering, Sir, if the Hon. the Financial Secretary could say when these audited accounts will be presented to the Public Accounts Committee for scrutiny.

Sir, again it is a matter of great concern that there was a significant fall in the amount of yield from direct taxation in 1954. There is no doubt that, in the absence of supporting data, the fall could have been attributed wholly to diminution in company profits. It would be enlightening if the Hon. the Financial Secretary could produce, for the information of this House, the numbers of various classes of tax-payers - individuals, partnerships and companies - who paid tax in 1954 and 1955, so as to indicate the rate of growth in the different classes of tax-payers, and variations in the size of their incomes. The question of formulating a common policy with the Federation is indeed very welcome. It is hoped that the two Governments will be able to reach a final agreement favourable to the mutual interests of both territories.

Sir, I am also very much concerned about the question of housing our population. Time and again we have been told that the Singapore Improvement Trust will offer houses at a low rental rate. These low rentals happen to be about $25 to $30 a month, and this, together with the lighting, water and other services, would go up to such an extent that the ordinary man, who receives a salary of $100 to $150 a month, could hardly pay such rates. We have been assured, Sir, very recently that the question of lowering housing rentals is receiving the active consideration of the Government. But I see there is little that the Government could do with its existing fiscal policy. Rents are still not within the paying capacity of the working class.

Sir, I would commend the following suggestions for the Government's consideration, as I feel that no other method could bring down the rents of those houses built by the Singapore Improvement Trust. The first is interest-free loans, and I am sure, as Government has promised it, money will be forthcoming interest-free for building accommodation for the working class.

Now, apart from this, I would also suggest a direct subsidy from Government sources to the housing authority. The City Council of Singapore have so far said or implied that they have no obligation at all towards the housing of Singapore's citizens. This is very obvious indeed, and even the other day the Hon. the Minister for Housing turned down the suggestion that the assessment rates on S.I.T. buildings and land should be waived by the City Council. Sir, I think we are all aware of the fact that outside this territory, in places like the United Kingdom and elsewhere, the housing authority grants loans for building houses and also gives a separate subsidy on houses built by the local authorities. I would suggest, Sir, that either the City Council waive the assessment rates on S.I.T. land and houses, or get them to pay as contribution towards the housing of the citizens an amount equal to the assessment rates, or even more if they are in a position to pay.

Lastly, Sir, having known a little bit of difficulty in the S.I.T., I realise that if some external assistance were to be given in the matter of housing, such as the loan of bulldozers and other earth-moving machines, we could considerably lower the rentals of these houses. I have heard the other day that the Government of the Federation have received some bulldozers and other earth-moving machines for agricultural purposes from outside sources. I am wondering, Sir, whether our Government cannot seek the assistance of the United Kingdom or other countries for a donation of that kind towards the relieving of our housing problem.

There is one other matter on which I would like to touch in regard to housing, Sir, and that is slum clearance. I would not like to dwell too much on this because I believe that the Government will undertake slum clearance at the earliest possible date. I can see that some start has been made and I do hope they will go on very vigorously with this project.

The last grouse that I have about housing is in regard to the standard of accommodation of these S.I.T. houses. Sir, all countries usually adopt a standard accommodation, it is sometimes called a national standard. Well, in Singapore today we have a standard accommodation provided by the S.I.T. and I think it is a very bad standard. These S.I.T. houses are not very well constructed and the facilities to tenants are far from satisfactory. There is very little room for baths and lavatories and there are no facilities for dining purposes. This was confirmed by the Hon. the Minister for Housing the other day. Sir, these houses are built to last from 20 to 60 years. No one can deny that. The standard of living of the people of Singapore during the coming five to eight years would be so high that, after that period, tenants who live in those houses which have no dining rooms would feel rather out of place. Also during that period, private development will take place resulting in an increased number of houses, and I am sure the consequence will be that these tenants will try to vacate these S.I.T. houses at the earliest possible date -

The Chief Minister: Let us hope so!

Mr Nair: - and that is the time the Government will regret that they have made a very bad start on housing accommodation. Sir, I suggest that we cannot sacrifice quality for quantity. Whatever we have, give it! Let the people live satisfactorily!

The next point I would like to dwell on is rural development. Sir, ever since I got on to this Council in 1952, I have been stressing this question of rural development very hard indeed. At one time I was told that there was no need for any development. There was no need for any particular person or body to look into this matter, because there was one body called the Rural Board which should undertake all rural development. And what is the result today? The Rural Board has been unable to provide the amenities which the rural people should get. There are no playing fields in the rural areas. There are no libraries in the rural areas. There is not even the barest minimum requirement in the rural areas as compared to the city. Unemployment is mounting. Normally, unemployment is not a big grouse in the rural areas, because even those who have employment are under-employed. They have no gainful employment, and I have not seen so far any Government measure being adopted to relieve under-employment and unemployment in the rural areas.

Education in rural areas: Sir, the reason for my pointing out all these things is because I feel that development in the rural areas should be treated quite separately from development within city limits, because in rural areas the conditions are quite different. I suggest, Sir, that in regard to education in rural areas there is no need to spend much money on schools. We should devise a scheme whereby we build village schools - which are the cheapest schools to build - and that, too, in good number to satisfy the requirements of the locality. The costs that have been shown in the Estimates, in my view, are very high indeed. I do not think that a primary school which can accommodate 400 children should cost $50,000. Village schools can be built at much less cost than that.

Sir, adult education in Singapore to a certain extent has been decentralised. I should think that more energy should be put into this question of setting up more adult education centres to satisfy the requirements of the rural community.

Sir, it was the day before yesterday, I think, that I read in one of the newspapers, the Singapore Standard, an article to the effect that Singapore is going to have a new library, and that is to be located at Stamford Road. Sir, I have often wondered why the Government is so keen on centralising all these amenities in the centre of the city. Cannot we have some libraries in areas like Katong, Pasir Panjang or any other places? Should we concentrate all the learning and knowledge of this Colony into this one part of the city? I should think this is very wrong. We should as far as possible give an opportunity to people to make use of this library nearer to their homes. If the answer to this question is that Government are having a few travelling libraries, I do not think, Sir, that it is a very good suggestion at all. A travelling library is most unsatisfactory. Government may say that something is better than nothing. But let us not treat a library in this way. Let us have it established where it is desirable and necessary. Let us not concentrate it in one part of the city.

The roads in the rural areas today are a most unsatisfactory form of communication and mode of travelling. In very many parts of the rural areas you have only one main road, and the farmers and the agriculturists, who have to make use of lorries and other vehicles for the purpose of conveying their fodder and other things, are undergoing considerable difficulty. I am not unmindful of the fact that this costs a big sum of money, but I do suggest that in order to overcome this difficulty, consideration should be given to setting up a road authority, or some kind of authority, to speed up road work in Singapore.

Sir, land and housing is another important problem in the rural areas. I can only say for certain in regard to conditions in my own constituency. 90 per cent of the population in my constituency are living on other people's land. This does not mean that all people have land in other areas, but the need for stressing this point is because of the fact that, due to gradual development in the rural areas, many of these attap-hut owners are receiving notices to quit their places and go to other areas. If that comes about, it means that they will be deprived not only of their huts but the piece of land which was given to them on payment of monthly rents. They are put in a position where they can obtain no land in the vicinity. The only alternative is that they will have to shift to various other places which will in turn inconvenience them in very many ways.

In regard to housing, particularly in the rural areas, I can see no evidence that the Singapore Improvement Trust has taken it as a matter of urgency. It may be that the Government might have thought that, since most commercial firms are in the heart of the city and the whole economy is connected to Collyer Quay, there is little benefit in building houses in the rural areas. I should think a separate scheme for rural housing, more or less on a semi-permanent basis, be instituted and satellite semi-permanent structure buildings in villages be constructed.

Sir, all the points that I have dealt with in regard to the rural areas have been with one purpose, and that is because, at the present moment, development in the rural areas is slow and being done piecemeal. Each department thinks of its own requirements in each village and there is very little co-ordination that I can see in these matters. The only way, the quickest way, and the surest way of getting things done on a planned basis in the rural areas is to establish a Rural Development Council where all the departments interested are represented, with an elected Minister as its chairman, and this Council assessing the requirements of the rural areas, planning their development and seeing to it that those plans are implemented. At the moment, Sir, due to a lack of co-ordination and due to the fact that all departments do not think alike in the rural areas, things have gone very unsatisfactorily, and, from experience, I feel that the only way for a planned rural development is the creation of a Rural Development Council and the implementation of those schemes by that authority. I am sure that the Commission which has been appointed by the Chief Minister will consider my proposal and see whether it could be implemented.

Sir, I have nothing much to say on other matters, because I feel it is only a matter of detail. Many of the items of expenditure inserted in this Budget are mere figures. If the Ministers are careful enough, and if the department heads are careful enough, there is always room for curtailing expenditure and exercising the utmost economy. I have only one comment, though, and that is the entertainment expenses of the Ministers. Sir, I feel that the Government has no explanation to give to the people of Singapore on this item -

The Chief Minister: Why?

Mr Nair: However they may argue and however they may justify this, the public are unable to understand this huge item put on the Estimates. I do believe that the Ministers themselves will be able to find a different way of asking for entertainment expenses. Let us have a policy that the Ministers will entertain guests, and let us also have a policy that all this entertainment will be limited to a certain amount in one month, so that there will be complete control of this item of expenditure by the Council of Ministers.

Mr John Ede (Tanglin): Mr Speaker, Sir, listening to the Budget speech of the Hon. the Financial Secretary nearly a fortnight ago, it was almost impossible not to share the gloom with which he presented his case, not the gloom which he shed over the country's financial situation, which is, in fact, much brighter than he chose to represent it, but the growing gloom at the missed opportunities and the broken promises revealed in the Government's fiscal policy and in the Estimates of Expenditure.

It has, of course, been fashionable for many years for Financial Secretaries to prepare us for the worst in one Budget speech, and in the following year to present a much brighter picture of that past year. But we on this side had hoped that the elected Members of this new Government would have brought pressure to bear to put an end to this little pastime and that we would have been presented with a more candid and realistic account of Government's intentions. Far from it. My hon. Friend has added to the uncertainties which have shrouded the country since the Government opposite took office, and in the most hesitant manner plodded over the whole field of possible taxation undecided where to cast his net. Like a butterfly - one of those strange Scottish varieties with hobnailed boots - he flitted from one source of revenue to another, finally coming to rest to sip at liquor, petrol and estate duty.

Having stated that he estimated a deficit of $22 millions in 1956 at the old taxation levels, he then introduced measures likely to yield only $7� millions and commented, "The balance, when its size becomes clear, will have to be met from reserves or else covered by increased taxation." Sir, the words "when its size becomes clear" are a dire confession that the Government's vision of the financial future is clouded, myopic and, as I have said, uncertain and that uncertainty is precisely what needs to be avoided.

What are we to think of a fiscal policy and its effect on the economy of the country which says in short, "We might double the rate of income tax or company tax during the course of the next year; or, of course, we might impose a purchase tax at the point of import, only we have not made up our minds whether it will work; or we might follow the Federation tax on tobacco, but actually we have not the courage at the moment because it would lose us too many votes?" This is not the way to restore a badly shaken confidence in the present Government's ability to govern. This is not the way to hasten the flow of capital into new industries. It is, in fact, a complete negation of the promise given in His Excellency the Governor's speech that "the maximum encouragement will be offered to both local and overseas investors", and a neglect of what should be the central objective of the Government's economic policy, namely, to expand the national income.

What, in fact, has happened? The Government has broken its promises by introducing indirect taxation which falls on rich and poor alike. Call samsu and stout a luxury if you please, but do not deny that these in Singapore are largely the poor people's drinks and by taxing them still further, you are placing a greater burden on the poor man's pocket. In taxing liquor, it is very much open to question whether the increase in revenue hoped for will be realised and whether diminished consumption will not be the result. I would remind the House, Sir, that the estimated revenue from liquor in 1954 amounted to $21 millions, but the final amount collected came to about $1 million less. In 1955 the revenue is likely, according to the revised estimates, to rise again to nearly $21 millions, showing that the falling-off in consumption in 1954 has been partially rectified. Whether the increase this year has been partly the result of jubilation at the Labour Front's election victory or the drowning of sorrows at this disastrous event depends on one's point of view, but it seems hardly a practical move to tax a commodity the consumption of which must be close to its peak, and I venture to predict that the Hon. the Financial Secretary will not obtain the $4� millions extra yield which he is hoping for. In fact, I believe I am correct in saying that the tax had to be reduced on still wines a year or two ago because of a marked falling-off in consumption, and that after the tax was reduced, consumption began to rise. This is an indication of the precarious ground on which the Government is treading.

Turning to petrol, while it can be maintained that an increase in tax only affects the car owner and that this source of revenue is still particularly buoyant, nevertheless, it should be remembered that 60 per cent of the cars on the island are below 11 horse-power and are owned by middle class people. Say what you will, the imposition of indirect taxation does not place the burden of taxation squarely on the shoulders of those best able to bear it, which the Government has stated to be their taxation policy, but in some form or another it must affect the poorer classes as well. It is sheer wriggling on the part of the Government to shift their ground from their stated policy and to try to obscure a broken promise by talk of luxuries, quite apart from the inconsistency of not taxing cigarettes or champagne which, I hardly suppose, are necessities.

Before I leave the revenue side and consider expenditure, there are at least three points missing from the Hon. the Financial Secretary's speech which should have been made, in my opinion, and regarding which we shall hope to have an assurance before the close of this debate.

Firstly, that we shall learn how many millions of dollars are being lost to the Treasury through income tax evasion, what practical steps are being taken by Government to combat it, and what extra revenue vigorous action of this sort can be expected to yield in the next year;

Secondly, that the Government is fully aware that the cardinal basis of its economic policy must be the expansion of the national income, that the Government will not wreck any possibility of this expansion by being evasive and mysterious as to whether or not it is proposed to increase the rates of income tax during the course of the year if the Federation will fall in line;

Thirdly, that, on the contrary, it will carry out its declared policy of encouraging investment, both locally and from overseas, by such methods as allowing income tax relief's, both initial and annual, on the cost of factory construction and initial plant and ensuring that such construction goes ahead with the least possible administrative delay.

Only in this way can the Government restore confidence to the country, create conditions which will give buoyancy to our revenues in 1956 and also in 1957, and bring hope of work to the growing army of unemployed, on which vital subject the Financial Secretary was singularly silent. As long ago as June last, the Hon. the Chief Minister informed this House that an Industrial Development Corporation was being set up, and it still seems to be in the realm of consideration.

It is indeed a most extraordinary move for the Government to range over the whole realm of taxation, stating not only what can and cannot be taxed, but what might or might not be taxed in the middle of a financial year, almost like a Budget leakage six months in advance. Normal practice is for the Government to announce its taxation policy at the Budget session, it being understood that this policy holds good without alteration for twelve months, unless, of course, some very severe financial crisis were to haste the country which required immediate action. A deficit of 15 odd million dollars, which may turn out not to be a deficit at all, cannot claim to be a critical position in view of the country's reserves. In our view, therefore, it is not only unorthodox finance but undesirable finance at this stage to hint that there may be extra taxation in the course of the financial year. Such a policy is an encouragement to speculators and hoarders and reveals that the Government has no firm line of its own, and this lack of confidence is passed on to the country where it gets magnified.

If my hon. Friend failed significantly to indicate what constructive measures the Government proposes to take to increase the revenue of the country, clouding the position over with hints of untimely taxation, he was equally evasive on the question of economies in the realm of expenditure. It is true that he mentioned that requests from Ministries and departments had been pruned by $21 millions as far as development was concerned. It is true that he stated that all applications for new appointments were examined. But these are annual events and cannot be regarded as economies. I am mindful of the words of the Hon. the Chief Minister in his speech on His Excellency the Governor's Address in April of this year when he said:

"A short acquaintance with Government does seem to indicate that we are apt in many spheres to live on a somewhat extravagant scale, and we intend to take action shortly to bring about a realisation by the Departments of the important need for economy."

There may have been a careful examination by Ministers to see whether a new appointment is necessary, but what attempt has been made to eliminate waste in materials, or to lower building costs through a re-examination of our standards? The Hon. the Financial Secretary hinted that something ought to be done about it in the future, but this kind of vagueness is not what one would expect from the Government, which has, after all, been over seven months in office. That the Government is not completely wholehearted in its desire to make economies seems evident from the failure after several months to set up an Estimates Committee of this House. Owing to the non-existence of this Committee, I hope, Sir that you will permit me to quote one example of what I mean with the barest minimum of figures.

36 primary schools in Group A of the Education Development Budget cost $240,000 each to build, and these are almost completed. If I read the Development Estimates correctly, the Government is about to launch on 18 schools in Group B in 1956, and these are calculated at cost $250,000 each, or an additional $10,000 per school. Has any effort been made by the Minister or the Council of Ministers, in the absence of an Estimates Committee, to see whether perfectly satisfactory primary school buildings could not be completed for, say, $200,000, which I have reason to believe is not impossible? If the S.I.T. has been able to construct apartment blocks at considerably lower costs than was thought possible a few years ago, why is the same not being done in respect of schools? A saving of the type I have indicated would reduce the cost of the 1956 building programme under this head alone by approximately $900,000.

Apply this principle to other departments, in particular to the Medical Department, and within the revenue available, I am convinced that we can continue to increase our social services at a more rapid rate than that indicated in the Estimates. Reductions of this nature today, streamlining in personnel and running costs, would give a chance for the revenue of the country to increase simultaneously with the growth of the national income, instead of being out of step with it, thus making heavy taxation not only a necessity but also an almost inevitable boomerang. But instead of Ministers devoting their attention to this vital matter, what do we find? We find that the Council of Ministers, between them, have been provided in the Estimates with a sum of $31,800 for entertainment during 1956 and that the six Elected Ministers are to have provided to their own offices, transport and travelling, the sum of $28,490. The point is that this Budget has been dubbed an austerity Budget. Projects have been abandoned because money is not available, and yet over $60,000 is to be voted to Ministers for entertainment and transport expenses. To say the least, this is setting an undesirable example. We are all perfectly prepared to be reasonable in this matter. Clearly the Hon. the Chief Minister must have some entertainment allowance -

The Chief Minister: Thank you!

Mr John Ede: - but not a very much larger sum -

The Attorney-General (Mr C. H. Butterfield) rose -

Mr Speaker: Point of order. Yes, Mr Butterfield?

Mr Butterfield: On a point of order, Sir. My point of order is that the hon. Member is anticipating now what is the subject matter of an order of another day, and discussing now the entertainment allowances of Ministers. I am referring to Standing Order 35.

Mr Speaker: Which part of Standing Order 35, Mr Butterfield?

Mr Butterfield: The first part, Sir. There are a number of motions of which notice has been given, Sir, relating to the items allowing for entertainment allowances and so on, and my submission, therefore, is that at this stage what the hon. Member says is out of order.

Mr Speaker: Standing Order 35 (1) reads:

"It shall be out of order to anticipate an order of the day by discussion...".

The "Committee of Supply" is not yet an Order of the Day. It will become an Order of the Day when I ask the Financial Secretary later on, "Committee of Supply - what day?" and he gives his answer. At the moment, there is no Order of the Day. Continue, Mr Ede.

Mr John Ede: Sir, I was saying that we consider that the Hon. the Chief Minister should have an allowance, but not a very much larger sum than that allocated to His Excellency the Governor. Equally clearly the Hon. the Chief Secretary should have some allowance, but not on the scale that has been customary in previous years now that he holds, if I may say so, a less exalted position. If extravagance of this sort is permissible at the highest levels, one can hardly expect economies in the departments of government themselves. We on this side of the House very much deprecate the provision of these perquisites of office and we shall move amendments on each occasion in the Committee of Supply unless the Government agrees to a very drastic revision of this sum of $60,000.

I must now touch briefly on certain main heads of expenditure where we disagree with Government policy and where, in two cases, we note with regret that the Government has failed entirely to carry out its promises. I must refer you to His Excellency the Governor's speech of April last which laid down the policy of Government for the ensuing year:

"The Community Centre scheme will be developed and more facilities provided for the underprivileged youths of Singapore."

But what do we find when we turn to the Development Estimates? Token votes only for three community centres, for youth holiday camps and for a Home for Handicapped Children; in other words, a complete failure to tackle these important projects. In the realm of Medical and Health His Excellency the Governor's speech made this promise:

"The Government will expand all medical and health services, including the establishment of district hospitals."

I voiced our misgivings regarding the Government's policy towards the expansion of the medical services seven months ago, and it is unfortunately quite clear that our fears have been realised. The plan of the previous Government, which it has been fashionable for the hon. Members to castigate as the Progressive Government, was to provide ten cottage hospitals, five in the urban area and five in the rural area, but this highly desirable scheme has apparently now been abandoned altogether. Furthermore, while the Minister for Health recently made a Press announcement that a new $3� million district hospital was to be built on the old Kallang Airport site, he forgot to mention the important fact that no new provision for it has been made in the 1956 Estimates, and this project is therefore only a paper one.

What is the general plan of the Government regarding the expansion of the medical services? The chief one would seem to be the building of a $2 million urban health centre, 75 per cent of which will, in fact, be paid for from the Colonial and Development Welfare Fund. This is the year's main project, but unfortunately it will not add immediately to the existing medical services, as it is a teaching centre and not intended primarily for treatment. For the rest, most of the funds available are to be spent on altering and improving wards in existing hospitals - always an expensive business. Surely the proper policy - and it is Progressive Party policy - is to get on as fast as possible with decentralisation? Surely the proper priority was to allocate sufficient funds to get on with the building of the new district hospital, leaving the improvements to the General Hospital to a later date if they still turn out to be necessary? We are extremely dissatisfied that so little progress is to be made in the direction of decentralisation of the medical services. So much for the Government's efforts in the realm of health.

Turning to education, the Government is at least consistent. Having ignored secondary education in toto in His Excellency the Governor's speech, it has continued to ignore it in the 1956 Estimates. It has given no new provision for this purpose, but only a revote sufficient to meet the building of two schools which should have been completed this year. This is a dismal fact, in direct contrast to the Hon. the Minister for Education's statement in this House only a fortnight ago that the six secondary schools provided for in the 1955 Estimates would be built in 1956, which has turned out to be a somewhat empty promise. Worse still, although a sum of $20 millions has been set aside, quite rightly, in my opinion, for grants-in-aid to vernacular schools, there is no sign in the Estimates of any recasting of the whole educational system and no reorientation - and I use that word deliberately - in plans. We shall consider the Government's education programme in detail in the Committee of Supply and, though I shall say no more today, it seems to me to be most disappointing.

I now turn to Public Works. Under this head, I will reserve most of my comments for the Committee stage and refer only to one point. We find that in the Hon. the Financial Secretary's speech and in the Estimates very little reference is made to the question of flood alleviation. The latter shows a vote of $123,000 to complete only the Bedok scheme, while the former mentioned, in passing, that out of a sum of $35 millions which would probably have to be borrowed in 1956, $5 millions would be needed for flood alleviation, housing loans, etc. In the Sessional Paper on the Draft Estimates flood alleviation was referred to as a miscellaneous commitment. As I have said, it has been lumped with housing loans and other unspecified items. I submit, Sir, that this is not proper budgeting. We on this side of the House want to know, and the public want to know, what are Government's precise plans in this important matter and we are not satisfied with its being pushed into a rag-bag of odds and ends and called a miscellaneous commitment. Nevertheless, the fact that the Government does not propose to use vigorous and immediate measures to tackle this important problem comes as no surprise, in view of the recent statement of the Minister in charge that flood alleviation would cost an awful lot of money and there was none to spare, and anyway the exceptional rains of last year were being repeated only after 60 or 70 years or so and could hardly happen again in the immediate future. As far as the violence of the monsoon is concerned, it is incredibly unwise to place one's faith in the law of averages. As the development of land in Singapore proceeds apace, the run-off of rain water is more rapid and as each year passes, smaller and smaller storms of shorter and shorter duration will produce the same flood conditions as today, and therefore, of course, they will recur more frequently. A shortsighted, do-nothing policy regarding flooding will not do. As things are at the moment, the farmers and the vegetable growers are to suffer more frequent destruction of their crops and the town dwellers consequently are to pay more for their vegetables. If the cost of living is to be kept down and the devastation of wide areas of land and its valuable top soil be avoided, a comprehensive three-year or five-year plan to tackle flood alleviation must start at once, and the Government must not shirk its responsibility in this respect.

Let me, Sir, sum up as briefly as I can what are our main objections to this Bill.

Firstly, the Hon. the Financial Secretary hedged round an unconvincing Budget with reservations and contradictions. On the one hand, he stated that a deficit of $22 millions less $7� millions to be raised by extra taxation was not a fictitious figure. On the other hand, he said "It is possible that, by the middle of the year, savings will have become available because of the inability of the Public Works Department to make the progress expected on certain major items."

Secondly, the Government has broken its promises by increasing indirect taxation which does not fall solely on those best able to bear it.

Thirdly, it has hinted at mid-year taxation of either a direct or indirect kind, which creates a lack of confidence, encourages speculators and hoarders because the types of likely taxation have been revealed and is totally uncalled for when the country's finances are basically sound.

Fourthly, it has failed to give an assurance that, whatever action may be felt necessary regarding personal tax in the future, company tax will be left alone so as to stimulate the expansion of the national income, the starting of new industries, and of giving the growing army of unemployed the hope that they can look forward to more jobs.

Fifthly, it has failed to examine the possibility of lowering the standards of building, with particular reference to the Education and Health departments, so that the funds available can be made to stretch as far as possible, and no Estimates Committee has been appointed for this purpose.

Sixthly, funds available have not been in all cases allotted to priority projects. The Head: Public Works Non-Recurrent General has been increased by $1 million over 1955 by items which are not of pressing importance, while entertainment and transport allowances to Ministers at $60,000 is not a good example to set.

Seventhly, certain Heads contain huge estimates of expenditure, for example, $5� millions for acquisition and development of sites for resettlement, and nearly $6� millions for purchase of land, with no breakdown figures whatever to show how these lump sums were arrived at and no indication that this intended acquisition or purchase has been correlated with the Government building programme.

Lastly, inadequate consideration and provision have been given to flood alleviation.

In conclusion, therefore, we are not convinced that the revenue available is being allocated so as to stretch as far as it possibly can. We are not satisfied with Government's what-we-might-do-tomorrow outlook in place of a firm what-we-shall-definitely-do-today policy, and we regret that the Government pays no more than lip service to the principle that the country can no longer plan expansion on a champagne basis.

Mr William Tan (Tiong Bahru): Mr Speaker, Sir, it would appear that the Labour Front Coalition Government has decided not to show its hand in the 1956 Budget to implement fully the socialisation programmes which it promised the people during the election. As it is, what we had from the Hon. the Financial Secretary on the 9th of November was a rehash of Budgets of previous years, with the increased expenditure principally in the Education and Health services. We wonder whether the decision not to depart from the tried and proven formula is due to want of courage or want of experience - we suspect it is probably due to both.

One is, however, perturbed that, in the first year of a nearly popularly but now reduced to a minority elected Government, the fiscal expert for the first time promised a deficit which he described and emphasised would not turn out to be a surplus eventually as in the preceding years, and he followed on and promised bigger and more substantial deficits in future years. His crystal ball showed a deficit of $40 millions in the year 1959, and therefore he is now telling the people to tighten their belts and to expect more and bigger taxation in all quarters, ranging from income and company taxes to luxury and purchase taxes, as well as other possible sale tax to be dreamt up for the electorate. The prophet of doom has spoken.

I submit, it is for the people to ask Government what other ways and means it has at their disposal to increase national income, other than the levy of bigger and higher taxes. One has no need, I hope, to remind Government of the law of diminishing return. Sooner or later, one will be taxed out of existence if Government were to stand still, fold up its hand and expect miracles to happen. The people would feel much happier if Government would turn its attention to the curbing of the rising cost of government. The figure for the civil service for 1956 is $98 millions, which is three times that of 1949 and nearly twice that of 1952. Ways and means must be found to stop this spectacular rise, and efficiency stepped up in Government services to save taxpayers' money.

When one examines the Budget in closer detail, it is obvious that Government may not be very confident of its ability to ferret out tax evaders, as surely a very small percentage of the people are actually paying income tax in full?

In the item under Broadcasting, one is aware that up to 31st October, 1955, 39,619 radios and radiograms had been imported. Against this figure, only 11,285 sets were exported, leaving a net balance of 28,334 sets for sale in Singapore only. Yet Government does not envisage any substantial increase in revenue derived from the sale of radio licences.

Surely, in order to find the money to meet the cost of social services, the economy of this country must first expand and prosper, resulting in an increase of national income. Trade and industry must be encouraged to produce a healthy and economic structure that will in turn produce dollars. A climate of political stability free from strikes must be attained, and that the Government has failed to do. Instead of flights of capital, we would have hoped for influx of capital.

One would be assured of the future of Singapore and Malaya if Government would introduce schemes to assist new light and secondary industries. Reasonable income tax concessions for new industries must be introduced. Industrial research and development centres under Government auspices should be built to help young industrial enterprises to compete with foreign goods. Government must be ready to remove obstacles and administrative red tape in approving new factory schemes so as to avoid unnecessary delays. Unless Government takes the initiative and has a positive approach to the economy of Singapore, I am afraid it will find it more difficult year by year to produce balanced Budgets, which we know is the first requisite of the sound economy and Government.

Now, as to its final decision to increase tax on liquor and petrol, the Government shows a singular lack of consistency. We were told they were frustrated by the Federation Government in the levying of a direct tax on income, and we were further told that they were similarly frustrated when they considered tax on luxuries. But now we are faced with the fact that tax will be increased on samsu and beer - the poor man's drinks - and the rich man's champagne, gin and rum have been left out untouched. We were also told that the Government, for want of courage, did not increase the tax on cigarettes and tobacco, which are hardly necessities, but there is now an increase in the tax on petrol which is a necessity. We were left with no other conclusion than that this Government has no fixed fiscal policy, and we sympathise with those people who are singled out to be penalised.

I would also touch at this time on the expenditure on Education. We note with approval the fact that educational programmes are receiving more and prior attention, as evidenced by the increasing appropriations each year. This is a proper trend as the education of this country's children is of the first importance in the building of a democratic, independent Malayan nation. The emphasis on this cannot be over-exaggerated. We are, however, particularly interested in the proportionate distribution of the funds for schools of all communities, as from the appropriations, one can tell Government's intention as to the different types of schools. We are deeply interested in the attitude of Government towards Chinese education and Chinese schools, whether it is their intention to raise its position in the education scheme of Singapore. The fact that the biggest number of taxpayers in Singapore today are Chinese would justify an equitable and fair distribution for the education of those who would much prefer to be educated, firstly, in the Chinese language. From the Budget, we note that there is an increase of $10 millions which has been earmarked as grant-in-aid for the Chinese schools. We will reserve our comment on this to a later time, when the report on Chinese education is tabled.

Turning to the school building programme that the Government is embarking on next year, we note that 2 secondary and 18 primary schools will be built in 1956. We would very much like to be enlightened as to how many of these are Chinese schools, English schools, Malay schools and Indian schools.

Mr Speaker: I must remind hon. Members that only one day is allotted for the Second Reading. If any hon. Member wishes to speak, let him speak now.

Mr R. Jumabhoy (Telok Ayer): Sir, I thought that, as the time was nearly up, I would wait till afternoon.

Mr Speaker, Sir, it is a source of wonder to me that every year we are asked to approve a Budget in which we have little or no say. If we, on this side of the House which represents fourteen Elected Members, had anything to do with constructing the Budget, then it would have been different from the one framed by the eleven Elected Members on the Government Benches.

The Minister for Communications and Works (Mr Francis Thomas): Form a government and construct a Budget!

Mr R. Jumabhoy: Will you have a little patience?

Mr Speaker: Order, please.

Mr R. Jumabhoy: Can we, for instance, Sir, ask what is happening to our United States hard currency earnings? We have asked about this, but we have never got a satisfactory reply. Can we, for instance, ask why such a large amount of our revenue is being drained away by the expatriates? Can we also ask, Sir, why a large amount of capital by European and other firms is being sent away in the form of dividends? Can it not be kept in this country?

Sir, looking at this Budget, one could see that expenditure is going higher year by year, and in this year's Budget expenditure is the highest. Sir, in Sessional Paper No. Cmd. 28 of 1955, page 12, the Hon. the Financial Secretary has said that "with regard to the future, revenue is tending to level off." Well, Sir, he is not optimistic about future revenue whilst expenditure is mounting up.

Coming to the natural resources of this Colony, I have time and again pointed out that we have no natural resources whatsoever like any other countries, or even like what the Federation has got. Sir, we live on our entrepot trade and that is also limited because, as time goes on, the neighbouring countries will naturally be getting imports from the source of production.

Sir, on the other hand, Port Swettenham and Penang are being developed with more harbour facilities, and if rubber and tin are to be exported direct from the Federation, where do we stand?

It is said that we must develop the cottage industry, which is a good thing for the housewife. But can we develop large-scale industries like Hongkong? Can we do that? Let us compare Hongkong and Singapore. In Hongkong there are no strikes. Their income tax, I believe, is about 12� per cent. They can produce things cheaper. Let us compare Singapore with other countries. We have got to compete with other countries like Japan and Germany in industrial goods. Sir, prewar, Japan used to sell its shirts in the London market, even right in Manchester. Now, while we are still in peacetime, we can compete only if we are to produce by manufacturing cheaper. In our present position, I wonder whether we can compete at all. I do not think industrialists will invest money here unless they can compete in selling the same article as other countries. Sir, the main factor in production is industrial peace. Have we got it here? Well, I can recollect that the Chief Minister said that he welcomed the strikes. And who is responsible - the present Coalition?

Sir, we are not allowed to utilise our hand currency earnings for our own benefit. It is the United Kingdom who takes it away. We cannot keep. If these hard currency earnings were to be kept by us for our own benefit, then our dollar would be much stronger than even the United States dollar. We have got plenty of our reserves in hard currency which is not being utilised for ourselves. Can we have a say about it? We cannot. We have no right to it. I have been asking about this, year after year, but no steps have been taken that we should utilise these currency earnings for our own sake. Suppose we were to utilise it ourselves to import goods direct instead of through the United Kingdom, we would have got things cheaper for our own people. On the other hand, Sir, we are allowed to import hard currency goods from HongKong by paying more in Malayan dollars, and also thereby enabling the Hongkong importer to make profit.

Sir, most of our revenue is being drained away by the expatriates in the way of salaries, passage leaves and pensions. Can we do anything about it? This has been going on for about 134 years. We are told that they have done good. Well, they are being paid to do good. They have got to serve. It is their duty. But have they done any good by drawing these huge salaries, barring out at least 90 per cent of the local people from the top jobs?

Sir, about trade. What are we doing to keep our capital in this country? As one of the hon. Members on my side has said - I think it was the Member for Seletar - most of our savings are being invested, even by banks, in places other than Singapore, where their earnings come from. You can save a lot - set up savings societies and so on - but the first thing should be that people must have confidence in Singapore.

Much has been said about entertainment expenditure. I do not think I will dwell much on that.

Now, Sir, see what happens in the free countries. Take India for example. Indianisation - after 200 years of British subjugation. Today India -

The Chief Minister: Subjugation!

Mr R. Jumabhoy: It may be a bad word - my English may not be as correct as a lawyer's - but today what is India doing? Apart from the Civil Services, even in private firms the foreigners have agreed to appoint Indians to three out of every four senior vacancies. If we want to Malayanise this country, why cannot we do it? We can easily get our own people to do their jobs.

Now, Sir, we are asked to approve a Budget which is being presented to us by only eleven Elected Members as against fourteen on this side, but I am sure the Government will carry it through with the help of the ex-officio Members or Nominated Members. Well, I will say this is a colonial Budget and I am voting against it.

Mr Lee Kuan Yew (Tanjong Pagar): Mr Speaker, Sir, may I enquire what would be an appropriate time for an adjournment of this House?

Mr Speaker: I can only refer hon. Members to Standing Order 7 (4) which reads:

"Any sitting may by decision of the Assembly, upon a motion which shall not require notice, be suspended at any time after 12 noon and when so suspended, shall be resumed at 2.30 p.m."

Any hon. Member who wishes to move a motion may do so. I did warn hon. Members that we have only today for the Second Reading and since no hon. Member is anxious to speak, I myself will suspend the sitting until half-past two.

Sitting accordingly suspended at 12.06 p.m. until 2.30 p.m. Sitting resumed at 2.30 p.m.

[Mr Speaker in the Chair]

Debate resumed on Question.

The Chief Minister: Mr Speaker, Sir, out of an expenditure of more than $200,000,000 for 1956, it seems that hon. Members across the floor are mainly interested in that infinitesimal part which deals with the entertainment and transport allowances of Ministers. It is a little pathetic, Sir, but since they want to criticise it, I think we should answer it. The first criticism I saw was in the Straits Times sometime last week in which a person by the name of, I think, Chan Kum Chee suggested that Government was going to spend money on the drunken lasciviousness of its Members -

Mr Lee Kuan Yew: There cannot be any doubt -

The Chief Minister: I discovered, Sir, that this man is a member, I understand, of the Progressive Party. Also, I understand, Sir, he is a Member of the City Council, whose life this House has extended. Sir, I enquired from the City Council whether any provision was made by them for entertainment. Sir, I trust that hon. Members of this House, even though they are in opposition to the Government, will appreciate that the City Council is an inferior body to the Assembly and to the Government; and I think the House may be interested in their reply: "For 1955, the votes for entertainment by the City Council are as follows: - $ Civic receptions 8,000 Freedom of the City for Sir John Nicoll 8,500 Freedom of the City for Malcolm MacDonald 8,000 City Day Celebrations 2,000 City President 4.800".

Of these, Sir, expenditure to date: "Civic receptions 5,209 Freedom of the City for Sir John Nicoll 8,487 Freedom of the City for Malcolm MacDonald 6,754 City Day Celebrations 100 City President 4,000".

Mr Lee Kuan Yew: Shame!

The Chief Minister: So, out of a total, Sir, for a whole year, $31,300 has been budgeted for by the City Council for entertainment and expenditure to date is $24,550. I have not heard, Sir, this man Chan Kum Chee, or any of his Progressive friends, attack the entertainment allowance in the City Council. As you are no doubt aware, Sir, though we have extended the life of the City Council, the majority of its members are from the Progressive Party. And it seems that the City Council may spend $31,300, but the Government of the country, Sir, cannot spend even less than that for entertainment expenses. Now, Sir, that is the kind of conduct which seems to me to reflect not only on the Party that seeks to attack the Government for making moderate provision for essential entertainment, but it also brings into disrepute the entire concept of democracy.

I should like to draw attention, Sir, to certain facts about this question of entertainment allowance. For example, there is allocated to me as Chief Minister a sum of $10,000. Now, I do not get that as part of my emoluments. I do not touch a single dollar of that money. That money is merely a provision for a contingency. The way we work it in the Council of Ministers, Sir, is that bills must be submitted to the Hon. the Financial Secretary, who must satisfy himself that the occasion is an appropriate one for a Government function and he must pay the bills himself. The Minister sometimes pays in advance, but when he submits the bill he gets just what is indicated on it, so that it may well be that the $10,000 is not spent or it may be overspent.

I think hon. Members may be interested to know just what types of entertainment have been given since so much stress has been laid on it. The first occasion was the farewell party to Sir John Nicoll - the first occasion on which this Government had an opportunity to give a function, and it was the intention then not so much to give a farewell party as to give an opportunity to the common man to get to know his Government; and to that dinner, Sir, were invited not the Armed Services or the Consular Corps, who get invited to all these functions, or the heads of departments, but 683 persons, consisting of trade unionists, representatives of youth organisations, representatives of the Police and Members of this Assembly.

The next function was one for Malcolm MacDonald at which there were 4,000 people present and in respect of which every Member who was elected was given an opportunity of inviting fifty of his constituents, so as to make it possible for Mr. and Mrs. Singapore, the people of this country, to take part in their own business. I am proud of this, that we have broken away from the tradition of the past and that the entertainment which has been given by this Government has been predominantly for the people of this country and at which the people of this country have been present.

Others, Sir, were a Chinese dinner party in honour of the Rt. Hon. Mr Lennox-Boyd, at which the Parties in this Assembly were represented; a Chinese dinner for the Foreign Minister of Indonesia; a cocktail party for the Colombo Plan officials; a dinner party for the Colombo Plan Ministers, and lunches to the Ministers of the Federation. As Minister for Commerce, I gave a lunch to the Hongkong industrialists, who organised an exhibition in Singapore, and also to certain Indian trade delegations.

Now, Sir, in every instance, the bills went forward to the Hon. the Financial Secretary and there was no question either of my receiving more or receiving less, so that the $10,000 that is allocated to the Chief Minister is not a fixed sum but is one which will vary with the necessities of the occasions. I feel that it is more than a little cheap that a great city like Singapore, which permits its City Council to spend more than $31,300 on entertainment, should take objection in this fashion to the normal and necessary expenditure for the normal courtesies extended to visiting personalities and on occasions of public importance.

Now, we come to the question of transport, Sir. The sum represented there is the payment of a sum of $150 a month to Ministers. I myself pay $150 a month to my driver, apart from the Provident Fund, apart from the insurance, apart from the cost of the car, from petrol, and from repairs. But that is the sum we have fixed, in trying to be modest, in fact, more than modest. You can quite appreciate, Sir, that if any of the hon. Members opposite were to be in my position, I have not the slightest doubt that they would get themselves Daimlers and liveried chauffeurs, and they would be to some extent within the logic of their positions in Singapore. The President of the City Council has a car and a livened chauffeur. You, Sir, have a car and a liveried chauffeur. But my Government has been sincerely seeking to achieve a different standard of expenditure. It may be, Sir, that in some of the receptions of the past, we have erred a little. I have looked at it carefully and I am prepared to admit that, perhaps, they were on a large scale, and I am certainly going to be a little more careful in the future; but to say that the provision of $31,000 a year for entertainment for Singapore is exaggerated is, with respect, Sir, disgraceful. As regards the question of transport, I challenge hon. Members opposite to suggest that it could be any less because I myself, Sir, have worked it out. I believe that my normal expenditure for transport is about $500 a month, but I take $150 -

Mr Lee Kuan Yew: That is for having a house in the country.

Mr Speaker: Order, please.

The Chief Minister: Sir, you will forgive the hon. Member opposite. He has a certain predilection for seeking the limelight at all times, and he has been rather silent for a considerable length of time.

Mr Lee Kuan Yew: Just you wait!

The Chief Minister: Now, Sir, in a particularly sterile debate to date, without a single constructive suggestion from Members opposite, it is more than a little depressing to look at this galaxy of fourteen vaunted representatives of the people and watch their inability to do anything but throw stones and mud-pies; completely incapable of appreciating what Government seeks to do and what Government has done; completely incapable of anything but sterile and quite often unreasonable criticism.

We have the Member for Tanglin (Mr Ede), on the one hand, complain that we have put five cents on a gallon of petrol in order to get it to the same level as the Federation. Five cents on a gallon is supposed to bear very heavily on the poor man - five cents a gallon. Any bus would do at least ten miles to the gallon; so half a cent a mile for about twenty passengers - that, Sir, is dreadful imposition on the poor by way of indirect taxation. But in the same breath he says, "Why do you not put a tax on tobacco?" That, Sir, according to Progressive Party logic, is not indirect taxation. It is merely a question of what Government does is wrong and what Government does not do is wrong. The Member for Tanglin wants a tax on tobacco. Now, Sir, I quite agree that in the ultimate analysis tobacco is not an essential commodity of life but it is the poor man's one luxury and to some that are addicted to it, it would be very difficult for them to give it up. To put a tax on tobacco would mean to place the main burden of taxation on the middle class and on the poor whom we seek to protect, and if we cannot tax the rich, we will not tax the poor. It is no question of timidity, Sir, it is a question of principle. The question of an imposition of a further tax on tobacco will come when more factories have sprung up locally to manufacture cheaper cigarettes, so that the poor people need not be deprived completely of their one luxury and can have access to cheaper locally-manufactured cigarettes. We have that in mind. It will come when we can lay the burden, as we should lay the burden, by direct taxation and, in this respect, it is curious to note that the Member for Serangoon (Mr Lim Choon Mong), who belongs to the same Party as the Member for Tanglin, could not have sufficient liaison between them in order to speak the same language on the same morning. The Member for Serangoon was all for direct taxation and increase of income tax, forgetting the shades of his President. The Member for Tanglin, Sir, warned us that we must reduce taxation in order to attract capital to this country. This is the type of criticism that a Budget, which has received the greatest and most careful consideration on our part, has elicited from hon. Members opposite.

Now, Sir, the Member for Tanglin and, I think, others as well have made a reference to the general impression in the country about the inefficiency of the Income Tax Department. Sir, I do not suppose that there is a single Income Tax Department in any part of the world which is not charged by its public with inefficiency. I do not suppose that there is any country in the world where there is not material evasion of income tax but I would like to say this - I know that the Member for Tanglin said it in a constructive spirit - that Government is very conscious of this public feeling and that Government is very anxious to seek to strengthen the Income Tax Department for the purpose of dealing more efficiently with existing tax evasion.

There is one other matter, Sir. I would not take up much time. In view of the unexpected adjournment, we are very short of time at the moment, but I would like to say this on the attack made that we have been guilty of leakage of Budget secrets. That is a normal practice for Government to disclose its Budget policy and not the means by which it achieves that policy, but I think hon. Members opposite should stop for a moment to realise this: what happened here, although not normal practice it is quite true, was that we had to meet an abnormal situation, because this Government is not in complete control of its fiscal policy. We are, to some extent. Sir, tied to the chariot of the Federation and it is only proper, out of respect to this Assembly and no more, that it should be aware of the intent and the final decision. The final decision, Sir, does not in any way indicate our policy as such if it were divorced from the background of the means by which we have to come to this compromise, which is not to our liking. That is why it was necessary to indicate what the decisions were, what the desires were, and what the decisions ultimately became.

Sir, the Member for Tanglin drew attention to a statement I made that we were very anxious to seek curtailment of Government expenditure. That remains true, and directions have been given to heads of departments, and I believe they have been loyally complied with, but I am still far from satisfied, Sir, not because there is any suspicion in my mind that I have not received every assistance from the civil service in the effort to bring down to a minimum the expenditure in the various departments, but because I think that the whole structure requires a comprehensive review by experts in order to assist in bringing down the expenditure of this country; and I would like to say this, Sir, that we have sought the assistance of the Government of India to send us three men who are, in their own right, Indian Government experts on organisation and method. We have asked for them in the hope that we would have them for at least one year so that they could review the position and make recommendations for the reduction of expenditure and, at the same time, teach some of our local civil servants the procedure whereby we can, in future, keep a constant check on a very natural tendency, Sir, on the part of civil servants - both expatriate and local - to indulge in a bit of empire-building on their own. This goes on in every country in the world, and we do need experts in organisation and method. Unfortunately, the Indian Government itself, Sir, has very great need of these men and they have been unable to comply with our request. It is my intention to take it up again with the appropriate authorities in New Delhi when I visit it early next month. I would like to say that I am by no means complacent about the sum - indicated, I think, by the leader of the Democratic Party (Mr William Tan) - of $98 millions spent, for example, on the Personal Emoluments of our civil servants. I am far from complacent about the expenditures of the Government. We have been seven months in office, Sir, and this sort of axing is not done in a day. I certainly intend to pursue methods which I have in mind for greater reduction in expenditure in the future.

I would like to end, Sir, by expressing regret that hon. Members opposite have not seen fit on an occasion of this nature to make suggestions of a constructive character that could assist us in the government of this country, instead of merely indulging in party politics from the Opposition.

Mr Lee Kuan Yew: Mr Speaker, Sir, of all the sterile speeches we have heard this morning, I think the one by the Chief Minister about the entertainment expenses and travelling allowances of his Ministers is about the most sterile of them all. It is a petty, completely irrelevant matter which has been raised by petty people and taken in an extremely serious manner by the Chief Minister who thought that it was an attack on the integrity of his Government. No one suggests, for one moment, that his Ministers fiddle their expense accounts or do not show bills to the Hon. the Financial Secretary. The point taken was that there should not be this extravagant example set by Government Ministers. The most unfortunate thing about today's debate is that the speech by the Hon. the Chief Minister was concerned almost exclusively with the entertainment allowances of City Councillors and Members of this Assembly, with their transport difficulties and their personal transport arrangements.

The Hon. the Chief Minister has said that he has had no constructive criticism coming from this side of the House. It was probably because the People's Action Party did not choose to speak this morning. However, whether he will consider what we have to tell him as constructive or just the slinging of mud-pies and stones is a matter of which, I think, he is not the best judge.

Mr Speaker, Sir, it has been suggested that you should not be a judge of what is fair and unfair reporting and the Hon. the Chief Minister has strenuously defended you. I would like to suggest that, at the end of the speeches for the day, what is fair or unfair, as said by the Opposition, should not be a matter which rests with the Hon. the Chief Minister.

Mr Speaker, Sir, the nature and character of a government is not decided by florid and flamboyant declarations of policy and intention. The final test is the fiscal policy of the Government which determines whether it is blue, light blue, light pink or deep red. The Hon. the Chief Minister should not have been so surprised that he found little which contradicted his Budget, because the placid assumption of all the speeches made this morning was: "It was a jolly good Budget and we got way with it."

There was the Member for Tanglin Club - I beg his pardon - the hon. Mr Sutherland - who could not conceal his relief that he was not made to pay what was his due and fair share of the taxation of this country.

Mr Sutherland: Do not talk rubbish! I never -

Mr Speaker: Order, please.

Mr Lee Kuan Yew: Mr Sutherland has impressed on the Hon. the Chief Minister that if he, the Chief Minister, were in future to do what is right and fair, then he, Mr Sutherland, would, on his part, meet the Hon. the Chief Minister's not inordinate demands for the welfare of the people of Singapore.

Then there were two Progressive speakers, the Member for Serangoon and the Member for Tanglin - and this is the only point on which I agree with the Hon. the Chief Minister - namely, that they both spoke with different voices. The Member for Serangoon must be very careful about what he says. What he expounded means, in effect, a Socialist programme, which would startle those who have supported and financed his Party. As for the Member for Tanglin, he is a more adroit businessman, who showed all the skill which the running of big business in this Colony inculcates in a business executive. References were made to the fact that the taxes were indirect. No reference was made as to how taxes should be raised in a direct and concrete form.

There was the Member for Tiong Bahru (Mr William Tan) who was rather vague. He proposed that the Hon. the Chief Minister should encourage local industry, trade and commerce. "Do not think of increasing taxation," says the leader of the Democratic Party, "but think of increasing the basis of taxation. Increase the income and then, at the same rate of tax, you will have more money to run the government." And the Democratic Party will be happy, the Labour Front will be happy and the people will be happy. Sir, it is one of those attractive propositions which, no doubt, if ever the Democratic Party and their new-found friends in the Progressive camp should form a government, we shall have the pleasure of watching them try to put into operation.

Then there was the Member for Telok Ayer (Mr R. Jumabhoy). Now, Sir, I have a particular affection for the hon. Member. In the sometimes dreary deliberations of this House, he brings a light touch. He brings the right personal touch. He is not concerned with taxation. He is concerned with the dire and deepening crisis in the constitution when he finds that the Chief Minister has only eleven votes now and he, on his side, has got fourteen. Sir, I have recently had several telephone calls from the Member for Telok Ayer, and he has been instructing me on the merits and demerits of the constitution.

Now, Sir, I never thought much of the Rendel Constitution even after it had been revised by the Hon. the Chief Minister. I will think much less of it if it ever came to the stage where one could have a conglomeration of opposing and naturally fissiparous forces all bound together with only one ambition

• to share the spoils of office. That would be a sight even more delightful than the one we have had before us. It is quite true that two of the people of whom the Hon. the Chief Minister was once so very proud when he said, "When I look at the Members of the Opposition and I look behind me, I thank God for the men I have behind me", -

The Chief Minister: I still do. I have not -

Mr Speaker: Order, please.

Mr Lee Kuan Yew: I do not thank God for what has happened and I will not thank God for the switch of sides by the two hon. Members of this House. No doubt they have good and solid reasons for doing so and we shall in this House by and by come to -

Mr Speaker: Is this relevant?

Mr Lee Kuan Yew: Mr Speaker, Sir, I was referring to the speech by the Member for Telok Ayer and mine is as relevant as his.

Finally, there was the speech by the Member for Seletar (Mr Nair). Now, that was a constructive speech. There we have someone who made proposals as to how the rural areas should be supplied with more libraries, not the travelling type, but the fixed type. There were all kinds of ingenious suggestions about how one could build cheaper schools. However, he said, one should not build those cheap houses built by the S.I.T., because one of these days there will be better houses to live in. Then everybody will leave the S.I.T. houses and stay in beautiful houses built by private enterprise where there will be dining rooms plus a kitchen. Now, Sir, I do not know how the Member for Seletar reconciles his cheaper schools with dearer houses. No doubt, it is a pity that he has not up to now been given the opportunity - we all hope he will eventually be given before the life of this Assembly expires - of contributing to the democratic processes of the Labour Front Government. [Interruption.] Sir, I am glad that the Hon. the Chief Minister was duly excited at such a prospect.

Now, Sir, we in the People's Action Party feel - perhaps we are the only Party in this House today which does, and perhaps I more than anybody else in this House - terribly disappointed at the failure of a Socialist idea. I have not one good word to say about this Budget. It is no different in substance from any of the other Budgets that have been presented before the Legislative Council since the British re-occupation of Singapore. I hold the Labour Front directly responsible for some of the shortcomings of this Budget. For other shortcomings, I hold the colonial officials who run the Labour Front Government directly responsible.

The Chief Minister: I object to that, Sir, on a point of order. Is the hon. Member entitled to make a remark of that character? It is disgraceful! Utterly contemptible!

Mr Speaker: Order, please. I am, of course, as hon. Members will realise, bound by Standing Orders, and if that statement can be considered to come under Standing Order 31 (4) which reads:

"It shall be out of order to use offensive and insulting language about Members of the Assembly",

then, of course, it is out of order. The other Standing Order says:

"No Member shall impute improper motives to any other Member."

I cannot see that that applies. I, for one, consider that the expression used by the hon. Member is perhaps a flight of rhetoric which I hope he will try not to indulge in too often and too long.

Mr Lee Kuan Yew: If it please you, Mr Speaker, Sir, it was not a flight of rhetoric which induced me to use that particular phrase, but an inclination to call a spade a spade.

Now, Mr Speaker, Sir, I propose to deal with the Budget defects in the two broad heads under which I have classified its shortcomings. The first is where I hold the Party Government to have been at fault. The second head is where I hold the Party Government - if I may put it inversely - not to be directly at fault, but nevertheless, indirectly responsible for.

Mr Speaker, Sir, a Socialist Government shows itself in its taxation and its expenditure. A democratic Socialist Party seeks, through a parliamentary democracy, to introduce taxation in order that money could be taken from those who have and to introduce social services in order that money or benefits can be given to those who have not. Now, Sir, the Hon. the Minister for Communications and Works (Mr Thomas) is a much better lecturer on academic Socialism than I am. No doubt, he will come to the rescue of his apt disciple, the Hon. the Chief Minister, when he explains away this Budget. The purpose of a Socialist movement is to create a more egalitarian society and to bring about in a peaceful and orderly way a redistribution of wealth and opportunity. Everyone in Singapore, including the hon. Mr Sutherland, has accepted the verdict of the electorate given on 2nd April. No one doubts the right of the Labour Front Government to put up taxes in order that its plans and its promises could be implemented. Everyone in the "have" group has not been able to conceal his great relief that this has not, in fact, happened.

The Hon. the Financial Secretary in his speech made an apologetic admission of the failings of the Government which he is now serving. There are still echoes in his speech of the talk to extend the benefits of a welfare state. For instance, on page 5 of his speech which says:

"These were subsequently pruned to $211 millions. In making these reductions, the following objects were kept clearly in mind: the need to limit ordinary departmental recurrent expenditure to the minimum required for the efficient discharge of Government business: the need to make adequate provision for the expansion of the social services: and the need to augment the funds likely to be available for development by a substantial contribution from revenue...".

To "expand" the benefits. Then there was an apologetic explanation why this taxation to raise funds which were necessary to implement the Labour Front Programme could not be brought about. A lot of possible avenues were explored - income tax, companies tax, first registration of motor cars, etc. etc. They went up to the Federation and, of course, the whole scheme fell through.

Also there were a lot of, in my view, "defensive" warnings of large increases in expenditure, both recurrent and non-recurrent. In fact, so much so that the hon. Mr Sutherland was much alarmed at the future prospect and much excited that such a stage should ever be allowed to pass. But he comforted himself with the fact that all Financial Secretaries in colonial governments had always threatened the people with dire consequences, but the dire consequences never came to pass.

All the criticisms of the speech of the Hon. the Financial Secretary have this one tacit assumption - a change at a quiet pace. The social and economic changes required in Singapore are to be carried out at a pace which a peaceful and stable society would require. That is an assumption with which the People's Action Party profoundly disagrees. We all know that there is a political emergency in Malaya with an armed rebellion, lasting for eight years. We have tried, in the short life of our Party, to bring home the fact that this political rebellion is largely caused and aided by economic and social injustices. Our approach to the problem of governing Singapore, our approach to the problems of economic and social injustices, must therefore be an emergency approach, not a peacetime approach.

It is useless to spend more money on the Police - about $2 millions more - for the reorganisation of the Special Branch and other things. It is useless to try and cure the political discontent if one does not, in the same spirit of ruthlessness - ruthless, because I think the Hon. the Chief Minister is capable of being a ruthless administrator for the good of the country - pursue remedies swiftly and decisively to get rid of all the awful things to which the Hon. the Chief Minister himself, when he was campaigning during the elections, referred.

I believe that within the framework of the existing taxation policy - I know the Hon. the Chief Minister does not desire to hear constructive criticism - a lot can be done to meet this economic and social emergency. It is our view that taxation should be pushed up to the maximum that the economy of the country can take without upsetting the basic trades and the basic economic structure of this country. It is our view, too, that we should be prepared to mortgage our future and borrow up to the hilt if we are to save the future at all. I do not know what was at the back of the mind of the Hon. the Financial Secretary when, in his speech on at least three separate occasions, he indicated that the Singapore loan market is limited. It says on page 7:

"... not because our credit is in doubt"

(in spite of the Labour Front Government - that is my own parenthesis, Mr Speaker, Sir)

"but because the capacity of the loan market is limited."

On page 11, he repeats:

"Part of this sum can be met from liquid balances but the great bulk of it will have to be borrowed in 1956. This may not be altogether easy. There will be other borrowers on a not unlimited market."

Again, on page 14:

"The local loan market is not unlimited in capacity. There will be other borrowers in the market besides Government. Access to other markets may be difficult to obtain."

The whole tenor of his speech is one of seeking to forestall any criticism that, in fact, the Government has no faith in itself; that, in fact, the Government is not prepared to do what is necessary, but is doing from habit exactly what it has always done. It is because of this attitude of mind that we get the Hon. the Minister for Communications and Works -

The Minister for Communications and Works (Mr Francis Thomas): You must do your homework!

Mr Speaker: Order, please.

Mr Lee Kuan Yew: If the Hon. Minister had done his homework, when he was learning Socialism, he would know that it is not for a Socialist government to say: Flood control is impossible. It costs $60 millions. We have no money. We cannot do anything about it. All we can do is not flood control but flood alleviation for $123,000. That Miscellaneous item of $5 millions, to which the Member for Tanglin (Mr Ede) referred is perhaps inclusive of this $123,000 for flood control. It is that timidity, that completely unimaginative frame of mind, that has led them to make such futile changes, if any changes were, in fact, attempted by the Labour Front. $60 millions for flood control becomes $123,000 for flood alleviation. There was a magnificent opportunity to bring home to the people that democratic Socialism can deliver the goods. There was an opportunity, if revenue could not be raised by direct taxation and immediate taxation, to mortgage the future, to do something which must be done by any government if it intends to govern this country in a forceful and efficient manner.

Mr Speaker, Sir, the economic and social battle for Malaya is likely to become more important than the military and political battle. It is likely to become very much more important after these projected talks with representatives of the Malayan Communist Party. Every political Party understands - now at any rate, they did not before, not the Progressives or the Democrats - that the people at large are not interested in "isms": Capitalism, Socialism, Fascism, or Communism. They are only interested in seeing that their ordinary lives improve. Whoever can work to improve their ordinary conditions of life gets their loyalty and allegiance. That is the basic principle which I think the Labour Front Government at heart really understands. It is for that reason that I propose to examine the Labour Front's Programme for housing, health, education and welfare within their own framework, within the framework of this constitution, and within the framework of the Budget that has always been introduced in the previous Legislative Councils - housing, a house to live in; health, education for your children, and welfare, security for the family.

The Labour Front Programme on housing, which I think should be well known to those who were its authors, was a bold, imaginative and an ambitious programme. Page 3 says:

"The Labour Front is convinced that no tangible progress towards solving the Colony's housing problem can be achieved without a Government subsidy on housing.

The extent of this subsidy will be carefully investigated and, to the amount that the financial resources of the Colony can bear it, it is proposed the subsidy should take the following form: -

(i) A direct contribution from Government to finance the housing programme of the Singapore Improvement Trust at a much more accelerated speed than at present.

This will entail converting the S.I.T. into a statutory Government housing agency, instead of being a quasi-Government body with restrictive powers as at present.

(ii) A reduction of the present interest rates on Government loans to the S.I.T., thereby providing for cheaper rentals for Trust accommodation and carrying this important social amenity to a larger number of the lower income group.

(iii) The encouragement of Housing within a Co-operative movement which assists the common man through thrift and enterprise to possess a home of his own. It is proposed to assist this movement by lending a large portion of the capital needed for housing projects.

(iv) The Labour Front considers housing as important as water, roads and electricity."

Now, Sir, the Hon. the Financial Secretary, on behalf of the Labour Front, has this to say on housing:

"As I stated earlier, there are other commitments of a capital nature in addition to those appearing in the development estimates. Funds for the construction of low rental housing will have to be supplied to the Singapore Improvement Trust. It is hoped that the Trust will be able to build new Units to a value of at least $18 millions in 1956, although much will depend on whether some solution can be found for the problem of clearing suitable sites."

$18 millions, Sir, for the S.I.T. for 1956. He doubts whether the S.I.T. could, in fact, use up that $18 millions. The Progressive Party has been doing that in conjunction with their colonial administrators for many years. The S.I.T. has, in fact, at one stage given up the hope of ever catching up with housing because it said the birth rate was increasing at such a terrific pace. A programme which was dynamic has been watered down into a continuation of Progressive Party Policy.

Health - Labour Front Programme, page 5 reads:

"THE MEDICAL SERVICES.

This Colony is endowed with one of the finest medical services in this part of South East Asia. Yet, the benefit of such services has not been reaching the masses" -

(masses - a very popular word. I remember the Member for Serangoon (Mr Lim Choon Mong) using it. It was very dangerous for him to use it.) -

"in the manner that is their right and privilege. In its first four-year term," -

(we have been informed it is going to be a two-year term now, Mr Speaker, Sir, - so they had better hurry up with this programme) -

"the Labour Front will strive to implement the principle of taking the medical services to the people rather than having the people go to the medical services.

To this end the Front will sponsor and encourage schemes for the decentralisation of the General and Kandang Kerbau Hospitals by the provision of district hospitals with outpatient departments and maternity wards in areas where there are large concentrations of the population.

The Labour Front will lay it down as a matter of Government policy that all services provided in hospitals - specialist treatment, operations, etc. - will be free for one and all. The provision of special wards, however, will be maintained" -

(this is obviously for the benefit of those on their side of the House) -

"so that those who can afford it, may be placed in special wards. This will provide a source of revenue that cannot readily be dispensed with. There will be no difference whatsoever in the treatment of patients, whether in special or in ordinary wards."

Now, Sir, the Hon. the Financial Secretary, on behalf of his Labour Front Government, says:

"Under Head 52: Medical and Health, provision is made for 560 new appointments. These are spread throughout the many departments and divisions of the Department and reference must be made to the Estimates to find out where and what they are. In all personal emoluments total $18.5 millions as compared with $16.8 millions in 1955. Recurrent expenditure totals $8.1 millions compared with $8.2 millions in 1955. The contribution to the Hospitals Board and Tan Tock Seng are reduced below 1955 levels. Again the special expenditure contribution to the Board is reduced from $1.5 millions in 1955 to $979,000 in 1956. In all, Medical and Health Expenditure totals $28.8 millions compared with $27.4 millions in 1955."

Mr Speaker, Sir, all that the Labour Front has done in this field of Medical and Health is to increase by $1.36 millions, the amount voted for it in 1955 by the Progressive Party-cum-colonial Government - $1.36 millions - and of that the Hon. the Financial Secretary was kind enough to inform us, a great deal was going to be taken up by annual increases in emoluments for serving officers. Where is the capital development? One district hospital worth $3 millions, of which an almost token vote of $100,000 is sought for 1956.

Education - Labour Front Programme, page 5 reads:

"FREE SCHOOLING FOR ALL.

The Labour Front's Policy on education is free compulsory schooling for all children, in English or vernacular schools, for the first six years as a matter of first priority. Thereafter scholarships or grants may be provided in deserving cases."

The Hon. the Financial Secretary, on page 8, on behalf of the Labour Front Government, says:

"Education: Personal Emoluments have increased from $18.7 millions to $20.2 millions. 964 new appointments have been added, mainly for probationary teachers. This gives a clear idea of the rate of expansion of the Department."

Finally he winds up saying that the increase, which is $12.9 millions over last year's Estimates, is largely to meet the natural increase in the cost of teachers, and the $10 millions extra cost to give equivalent treatment to Chinese schools by grants-in-aid. No attempt is made to achieve this commendable ideal of free compulsory schooling.

The Member for Serangoon has cited his personal experience of people knocking at his door asking him to use his influence as a school-master to get their children places in school. I am afraid, Mr Speaker, Sir, that he will find it extremely difficult to fulfil all his personal obligations unless he gets the consent of the Hon. the Minister for Education (Mr Chew Swee Kee) to spend some millions of dollars immediately, and not in the future, to bring this about.

Well, Sir, nothing has been said of welfare, so I cannot blame the Labour Front for not doing anything. They did not say a word about welfare but the Hon. the Financial Secretary said:

"Social Welfare: Provision for Public Assistance has been increased from $4 millions to $5 millions."

If one looks at the Estimates on page 17, there is an increase shown of $1.07 millions over what was voted last year. Mr Speaker, Sir, an increase of $1.07 millions to look after the welfare of the people, sickness benefits, unemployment benefits and T.B. benefits.

If one looks at the Head: Police, one finds that it has gone up even more than Social Welfare, $2.65 millions over what was spent last year - $2.65 millions out of a total of $50 odd millions. We are told, amongst other things, that the Special Branch of the C.I.D. is to be reorganised. Sir, if one were to spend more money, not just a little bit, but a lot more money on housing, health, education and welfare, it is my belief - I may be quite wrong because it may be a bit too late in the day - but it is my belief, the only faith that one can have in such a situation, that it would not be necessary to have more and more increases of expenditure on para-military forces. It is better to prevent a situation which gives rise to this need for more policemen rather than try to contain the situation from getting worse by repressive Police measures.

How, asks the Labour Front Government, are we to get the taxes? The Hon. the Chief Minister has said that tobacco is a poor man's luxury and one of these days, when cheap tobacco is manufactured locally, he will tax imported tobacco. He will tax imports, but he will allow cheap local tobacco to be sold without tax. Now, Sir, I seldom agree with the Member for Tanglin and I hope I shall not have much occasion to - unless, of course, he gets converted into something or the other. But I must agree with him that tobacco should not have been allowed to escape unscathed. It is not a necessity and, in fact, there has been a lot of medical literature to say that people should not smoke cigarettes. Of course, the Hon. the Chief Minister is one who enjoys the fragrance of Virginia in a leather-bound pipe and, like the generous-hearted man he is, he likes everybody in Singapore to enjoy his vices and share the benefits of civilisation.

The Chief Minister: I enjoy whisky too.

Mr Lee Kuan Yew: And whisky and champagne and caviare more than anything else. I say this: This cowardly refraining from imposing a duty on tobacco to bring it up to the Federation level is not worthy of a Socialist movement. I say it is a cheap way of avoiding any measure if it brings unpopularity.

We say that taxation could have been increased on income tax and companies tax, in spite of the Federation Government wishing to reconsider their position in two month's time -

Mr Francis Thomas: How?

Mr Lee Kuan Yew: Mr Speaker, Sir, I am glad that the schoolmaster still wishes at this time of life to learn something about economics. They have seen fit to put up the rate of estate duty well beyond that in the Federation. They have made it so that today it is cheaper for a rich man to die in the Federation than to die in Singapore. The Hon. the Financial Secretary has said that there would be a flight of all wealth, companies, and capital in the Federation if there were discrepancies in fiscal rates, either income tax or companies tax or any other form of taxation which is direct. Has it not occurred to him that this estate duty would mean a flight of capital? Has it not occurred to him that it would be cheaper for a rich man to hold shares in a company registered in Kuala Lumpur and not registered in Singapore, on which he will pay Federation, not Singapore, estate duty? Has it not occurred to him that a rich man would find it worth while to have a large mansion in Johore Bahru instead of Singapore to reside in, on which he will pay Federation, not Singapore, estate duty when he dies.

The Chief Minister: He lives in Singapore.

Mr Lee Kuan Yew: "He lives in Singapore?" He will die domiciled in the Federation. Mr Speaker, Sir, the Hon. the Chief Minister is a man who is well versed in advising clients how to work the law to their advantage in a lawful manner. In fact, his great success in life has been because he was most adept at advising those who do business with countries whose currencies come under foreign exchange control, how they can work it that the law, in fact, does not militate against them when obviously the law was designed to militate against them.

But my other point, Sir, is that it is impossible for the Federation not to put up the income tax. They are in a more acute economic position than Singapore. They wanted two years ago, in my recollection, to put up the companies tax and the income tax. It was then the Member for Tanglin's friends and relatives in the Progressive Party Government who most vehemently prevented it. They gave some millions of dollars of Singapore money, which had already come out of their pockets, to the Federation to prevent them from taking more money out of their pockets in the future. There should have been more courage and boldness shown, more imagination. The long-term trends are clear. The Federation taxes cannot be below Singapore taxes. They cannot afford it, and if we had increased either the companies tax or the income tax, it would not have been worth any company's while, or any shareholder's while, to transfer his assets to the Federation because he will be caught with the same taxes in the Federation in a very short time.

Now, Sir, I will come - I know the Hon. the Chief Minister is somewhat alarmed, Mr Speaker, Sir, that he has shot his arrow for the first time -

The Chief Minister: I will remind you of your promise, Sir.

Mr Lee Kuan Yew: Mr Speaker, Sir, I will now deal with the faults of the Budget for which I do not hold the Hon. the Chief Minister and his elected Members directly to blame. [Interruption.] We can carry on after four. It does not matter.

The Chief Minister: There is no question -

Mr Lee Kuan Yew: We will carry on beyond four p.m.

Mr Speaker: Order, please.

The Chief Minister: Would you, Sir, perhaps remind the Member -

Mr Lee Kuan Yew: Is it on a point of order?

Mr Speaker: Is it on a point of order?

The Chief Minister: Well, Mr Speaker, perhaps -

Mr Lee Kuan Yew: Is it on a point of order?

Mr Speaker: Order, please. I am asking the Chief Minister whether it is on a point of order.

The Chief Minister: If you were to remind him, Sir, that there is such a thing as a guillotine on the Second Reading of the Budget and there is no question of suspension. The hon. Member has given an undertaking about the length of his speech and it has been arranged that he should have an opportunity to do so in full, giving the Government an opportunity to speak in reply.

Mr Speaker: I cannot pay any regard to that because it is not a point of order and because the hon. Member did not give way.

Mr Lee Kuan Yew: Mr Speaker, Sir, I would just like to say that I was asked how long I thought I would take, and there was no undertaking. There was absolutely no binding consideration of any sort. But I shall try my best to see that his colleagues have an opportunity to meet my points.

Well, Sir, my attack now is on those who framed this Budget, and I would be prepared to believe that the Labour Front Government as such has not been responsible for the perpetration of this colonial Budget. In fact, I am quite prepared to believe that a great number of them may not know what this is all about.

First of all, the form of the Estimates. This is the first time, Mr Speaker, Sir, that the Government of the Colony of Singapore has had to present a Budget to be discussed publicly. Before that, they did it in the discreet cloisters of Empress Place.

Mr Francis Thomas: Do not waste time!

Mr Speaker: Order, please.

Mr Lee Kuan Yew: Why was there no Committee of Estimates to go through this Budget so that we will know what these items are all about? There are innumerable items which no one, unless he is a Member of the Government and has access to Government files, can know about. I shall refer to a few of them briefly by way of example. There has been a change in form and classification. My contention is that the whole presentation in this form is inadequate and unsatisfactory because it gives insufficient information. What information it does give is very difficult to comprehend. Take an example, Mr Speaker, Sir, first of all, at page 108, "$40,000 - Commissions, Conferences and Visits of Advisers". What is it all about? Who gets commissions, conferences and visits of advisers? The Treasury? "Title changed from Commissions and Conferences. Previously shown under Head - Miscellaneous Services."

Then, at page 53 - "Passages and Miscellaneous Travelling Expenses - $ 1,600,000." What does it mean? I can quite believe, Mr Speaker, Sir, that our expatriate civil service do require a very large sum of money to flit back and forth on their regular recuperative journeys, back to their homeland. But I do not understand what "Miscellaneous Travelling Expenses" mean. Does it include, for instance, Mr Cresson's flight to Britain and back? Who has control over this? Last year, the Estimates showed $1,000,000. This year we are asked to vote another $600,000. We do not know what this is all about.

Then on page 78, we have this curious item - nobody can make sense out of it. I have asked quite a number of those who ought to know what it is all about and they say they do not know. Under the Head: Police, item 14, "Expenses connected with Medical Treatment in United Kingdom." What is it all about? Are they people who have been shot and must recuperate in Britain? Is it because our medical facilities at the General Hospital are inadequate?

The Chief Minister: Is it your intention to talk so that we cannot answer you?

Mr Speaker: Order, please.

Mr Lee Kuan Yew: No, Mr Speaker -

The Chief Minister: Well, get on with it.

Mr Speaker: Order, please.

Mr Lee Kuan Yew: And the classification of those Tables. One is told that Personal Emoluments mount up to $98 millions. One assumes that that is the cost of the civil service running the Government. But when one turns to page 78 and finds out under Other Charges, Special Expenditure: "Police Lieutenants, thirty-four: - Provision for 7 months only - $351,920", surely there must be some means by which we know that $98 millions does not include all these other "Salaries and Allowances; Clothing and Accoutrements; Leave Pay; Light and Water Charges and Domestic Service" (for Police Lieutenants) "and Passages" and that they come under payment for services of Government servants?

Then we have under the Head: Prisons, at page 86, "Staff Salaries and Allowances" which is not shown under Personal Emoluments and not included in the $98 millions. What are we to make of it? And one finds, if one tries as I did to find out how much our civil servants cost -

The Chief Minister: Why do you not ask?

Mr Lee Kuan Yew: It is supposed to be in the Estimates. After one finds out what the Hon. the Chief Secretary and the Chief Justice are paid, if one turns to page 250 one suddenly sees under the Head: Public Works, "Replacement of Crockery and cutlery in residences of the Chief Justice and Chief Secretary - $7,000". Surely, all this is payment of the Civil Service that we are maintaining?

My first charge on the form of the Budget is that we should at least have tables from which we could easily know how much is the charge on the community for a particular item.

Now, the point of substance on the Estimates for which I do not held the Hon. the Chief Minister responsible - the content of it. The whole Budget reeks of colonialism. The Hon. the Chief Minister has told us proudly, "This is your Government! I am the Government! I was elected! This is not a colonial Government!" Let me read to the Hon. the Chief Minister what he is, asking us in his Budget to pass. Personal Emoluments $98 millions, of which expatriation pay - one gets these figures by going page by page on an adding machine and churning it out - is $1.9 millions, approximately 2 per cent of the total Personal Emoluments: Variable Allowance, which everybody enjoys, $18 millions; Standstill Allowance, $11,000; Hotel Allowance, $328,000; Entertainment Allowance, $51,000.

The Chief Minister: Can we not read?

Mr Lee Kuan Yew: There are other allowances - Passages and Travelling. Does the Hon. the Chief Minister realise that he is asking us to pass under the Head: - Governor - "Household Requisites, Government House, expenses $6,400; Upkeep of Motor Cars, $7,000"?

Then under the Head: Commissioner-General, Residence Upkeep, $80,000.

Under the Head: Assistant Commissioner-General for Colonial Affairs - Expenses of Office and Residence, $123,000. Then we have under the Head: Legislature - Upkeep of Speaker's House and Grounds, $8,000 -

Mr Francis Thomas: On a point of order, Sir. Is the hon. Member speaking on the general policy of the Administration as contained in the Estimates?

Mr Lee Kuan Yew: Indeed, Mr Speaker, Sir.

Mr Speaker: The hon. Member is not out of order.

The Chief Minister: Even though he breaks his word, Sir.

Mr Lee Kuan Yew: Indeed! Chief Secretary's Residence, $13,660, Chief Justice, $4,640 -

The Chief Minister: This is the last time I will believe you.

Mr Lee Kuan Yew: I ceased to believe the Hon. the Chief Minister long ago, Sir. Under the Head: Governor, we find Allowances to Governor's Deputy, his Private Secretary, and his Aide-de-Camp. Under the Head: Commissioner-General, we have the Private Secretary, Duty Allowance; Contribution to H.M.G. for Salaries and Allowances of Household Staff. All this is democracy -

The Chief Minister: It makes you drunk to -

Mr Lee Kuan Yew: Transport for the Government total of sums under each head $1 million: Governor $5,000; Commissioner-General $500; Legislature $1,500; Supreme Court $7,500; etc., totalling up $1 million. What is this fantastic thing we are asked to pass? Is this democracy, Sir? I know of certain people who would be delighted to read of this because it will only renew their faith in that this constitutionalism is a lot of eye-wash. This is, in fact, colonialism, legal lawful looting. The Hon. the Chief Minister says he believes that his civil service have carried out economies. He issued a directive and they faithfully carried it out. Does he know, for instance, how these economies were effected in the Medical Department? Medical Department economies - not in emoluments. That did not go down. Nor in appointments, because they are going to appoint many new superscales, a fact which has set the whole of the senior local medical service up in arms - all superscale posts for expatriates. But there are economies by reducing provisions - Medical, Surgical Equipment and Stores, General Hospital, provisions less $125,000, Medical, Surgical Equipment and Stores, less $13,800; Kandang Kerbau, provisions less $129,000, Medical, Surgical Equipment and Stores, less $45,000; Woodbridge, less $50,000, Medicines, less $20,000: Trafalgar Home, provisions less $77,700; Medicines, plus $12,000; Middleton, provisions plus $2,000, Medicines, less $4,000; St. Andrew's, provisions less $10,000, Medicines less $3,000; Middle Road Clinic, provisions less $5,000, Medicines less $5,700. A total reduction of about $400,000 for provisions and $76,700 for Medicines and Supplies. The Government has a saving of $300,000 in contribution to the Hospitals Board, but Provisions and Medicines are reduced by $471,000. That is the economy. I do not blame the Hon. the Chief Minister. As I have said in my opening, I can quite believe that he, in fact, did not understand what his civil servants were doing. But I say this is not the kind of Administration that we want because it is a matter -

The Chief Minister: Do you prefer an Administration where people break their word and their undertaking?

Mr Speaker: Order, please.

Mr Lee Kuan Yew: And Malayanisation-

The Chief Minister: You have promised to shut up.

Mr Speaker: Order, please, Mr Chief Minister. He is within the Standing Orders.

Mr Lee Kuan Yew: Mr Speaker, Sir, it is really sad to see the Hon. the Chief Minister getting so excited -

The Chief Minister: It is so very sad to see an hon. Member dishonouring -

Mr Lee Kuan Yew: On Malayanisation, the Labour Front Programme says:

"The Labour Front stands for complete and rapid Malayanisation of the public services by domiciled officers. Transients whose loyalties are elsewhere and who regard Malaya merely as a stepping stone in their personal careers may be retained on temporary contracts coterminous with their utility."

There are some 25 new appointments which we have tabled for amendment in the Bill in the Committee of Supply which are all earmarked, and we shall prove them to be earmarked, for expatriates. The whole Malayanisation policy is being defeated -

The Chief Secretary (Mr J. D. Higham): That is not true.

Mr Lee Kuan Yew: We shall go through item by item when the time comes -

The Chief Minister: Why do you not do it now?

Mr Speaker: Order, please.

Mr Lee Kuan Yew: I can understand why they are unhappy. So far they have been attacked by right-wing Parties who have got nothing to complain about a right-wing Budget. But they squirm when they are attacked by a left-wing Party because they have got a right-wing Budget -

The Chief Minister: I squirm to see a Member break his word.

Mr Speaker: Order, please, this debate is getting out of order. Hon. Members must remember that they are bound by Standing Orders, and however difficult a Member may be about the application of Standing Orders, they must listen to him patiently.

The Chief Minister: Mr Speaker, Sir, I would like to apologise for these interruptions, but I would like to say this. There is such a thing as arrangements outside in respect of allocation of time and I think you can understand, Sir, how sore we feel that there should be a breach of such an agreement. But I do regret -

Mr Speaker: I do hope that perhaps the time will come when we will have an Opposition Whip and a Government Whip who will get together and allocate the time -

The Chief Minister: We did get together.

Mr Speaker: Order, please.

Mr Lee Kuan Yew: Mr Speaker, Sir, we have a most recalcitrant Chief Minister when he cannot get his way. He asked me how long I would take. I said half an hour to three quarters of an hour. It is about three quarters of an hour now and I shall be stopping very shortly in order to give his Ministers a chance to say something before sentence is passed.

The whole Budget is a total disappointment and the Hon. the Chief Minister should be the first to realise it. It is the same old form with the same old expenses. When we last queried the Labour Front Programme scheduled for four years, we were told, "Oh, we should not be too quick about these things because, after all, it is going to be spread over four years." Mr Speaker, Sir, it is quite unlikely that there will be more than one Budget which the Labour Front will introduce in 1956, if the Hon. the Chief Minister keeps his word that he will quit in 1957 and have fresh elections. Of course, he may not - we do not know. But, if there is only one more Budget and if they do not retrieve themselves -

The Chief Minister: On a point of order, Sir, I respectfully suggest, Sir -

Mr Speaker: Is it a point of order, Mr Chief Minister?

The Chief Minister: It is a point of order and I suggest that the speaker is being offensive.

Mr Speaker: In what way, Mr Chief Minister?

The Chief Minister: In suggesting that I will not keep my word.

Mr Lee Kuan Yew: Mr Speaker, Sir, -

The Chief Minister: I ask for a ruling on that, Mr Speaker, Sir.

Mr Speaker: You are making it very difficult for me, Mr Chief Minister. I have already indicated that perhaps the hon. Member is engaging in flights of rhetoric and I cannot really rule that what he has said is, in fact, offensive within the meaning of the Standing Orders.

Mr Lee Kuan Yew: I am much obliged to you, Mr Speaker, Sir, but what I wanted to point out to the Hon. the Chief Minister in a polite way is that, unless he does something about next year's Budget before his Government goes out of office and faces the electorate, he will have gone down as a phoney Socialist -

The Chief Minister: That is my business!

Mr Speaker: Order, please.

Mr Lee Kuan Yew: Indeed, it is his business, Mr Speaker, Sir -

The Chief Minister: Not your business!

Mr Lee Kuan Yew: Unfortunately, it concerns the whole country. And it concerns the People's Action Party, because the policy of the Labour Front may make the fight for a democratic constitution in this Colony successful or unsuccessful. I wish the Hon. the Chief Minister, as he knows well, every success but I wish to point out to him that what he is doing -

The Chief Minister: Keep your points to yourself.

Mr Lee Kuan Yew: - is not leading to a successful conclusion of his Government's programme. They will stand condemned unless they do something about it in the very near future. They will stand condemned for having moved, after all the promises, after all the rhetorics at which the Hon. the Chief Minister is so very good, a completely mundane, prosaic, colonial Budget.

The Chief Minister: They can go back to the double-talking P.A.P.!

Mr Lim Cher Kheng (Changi): Mr Speaker, Sir, all of us have enjoyed very much the wonderful and so far the hottest debate this morning till now, especially the speech delivered by the Member for Tanjong Pagar (Mr Lee Kuan Yew). It looks as if he is going to become once again the champion of the people. He made the criticism that this Member was wrong and that Member was wrong. It looks as if the whole House, except the Member for Tanjong Pagar, was saying the wrong thing!

Sir, I am sorry that I cannot say that the Member for Tanjong Pagar had said anything constructive. I have to confess that I feel very sorry that party politics should have intruded into this House, which is largely an elected Assembly, because this is very harmful to the country. I sincerely hope that all Members of this House will put away their party interests and have the interests of the people of Singapore at heart when taking part in this debate.

Now let me get on with my humble speech. I am sure a lot of you will find it very dull because I cannot speak the Queen's English as well as the Member for Tanjong Pagar can. We have expected an imaginative programme covering public works development, new schemes for fisheries and agriculture, measures for flood control and slum clearance for the poor people, but the 1956 Budget has come as a big disappointment. The people of Singapore have a right to expect the Labour Front Coalition Government -

The Chief Minister rose -

Mr Speaker: Yes, Mr Chief Minister?

The Chief Minister: Mr Speaker, Sir, I wonder if you will forgive this interruption. If I am to have an opportunity to answer the various observations that have been made, I shall have to take a few minutes on the Government side, and I was wondering, Sir, if the House would permit, under the provisions of Standing Order 71, suspension of the Standing Order empowering an adjournment of the debate on the Second Reading of the Budget at 4 p.m. and permit it to continue. Would you permit me, Sir?

Mr Speaker: Can I have some indication as to how many other Opposition Members desire to speak, because if there are they should all be given the opportunity too, so that if there is going to be a suspension of Standing Orders, then it should be for the benefit of all?

Several hon. Members having indicated their desire to speak by a show of hands, the Chief Minister rose -

The Chief Minister: If it please you. Mr Speaker, Sir, may I respectfully move that, under the provisions of Standing Order 71, the Standing Orders for the conclusion of the sitting at 4 p.m. be suspended, Sir, and that the debate continue today until a vote is taken?

Mr Speaker: I must first have the general assent of the Assembly that that course be taken. As there is no dissenting voice, the motion can be put.

Question, "That the present business be exempted from the provisions of Standing Orders 7 and 69 (2) to enable it to be concluded," put, and agreed to.

Mr Speaker: Please continue, Mr Lim Cher Kheng.

Mr Lim Cher Kheng: I think the people of Singapore have a right to expect a Labour Front Coalition Government that is no longer colonial in outlook but one that is conceived by the people's representatives for the good of the people, to make comprehensive plans for the development of off-shore fisheries, institute research schemes for agricultural development, plan flood control projects in rural areas, and go into the problem of industrialisation and development of the country's natural resources. Only by the encouragement of local production of foodstuffs and expansion of industries can this country be independent of other areas.

Turning to the field of education, the Labour Front Coalition Government preceded the appointment of an All-Party Committee on Chinese Education with the much publicised announcement of its reorientation in attitude towards Chinese education, but this has not been fully reflected in the 1956 Budget. The appropriation for the grant-in-aid to Chinese schools has increased from $4,370,000 to about $10 millions, but out of the total appropriation of $46 millions for the education service for 1956, Chinese schools only receive slightly over 20 per cent. I fear this could not be construed as a fair and equitable distribution of funds, as Chinese schools cater to as many students as the English schools. From the Estimates, we understand that many new schools will be built in 1956, but we would like Government to clarify in more detail what types of schools these new ones will be.

We sincerely hope that the Government will declare its stand on vernacular education in clear and unequivocal terms, for a fair and equitable policy towards all races in their school development, and that sufficient funds be allotted both in grant-in-aid as well as in capital expenditure. Only in this way can a fair and equitable policy be realised.

Let us come to the medical services. In the Budget we could not trace any signs of increase, or any chance of increase, in hospital beds. We sincerely hope that all Hon. Ministers, and not only the Minister for Health, will pay a personal visit to the Outdoor Patients Department of the General Hospital, and see clearly for themselves what the people of Singapore are so much in need of in these difficult times. And then we hope that the elected Government will try their best to cut down on some items of expenditure which have been bitterly criticised by Members of the Opposition and do something of which the people of Singapore are really in need.

Inche Ahmad Bin Ibrahim (Sembawang): Mr Speaker, Sir, I do no think I could add anything more to the general feeling in this House that the Labour Front has not translated its claims of Socialism into financial terms.

The Chief Minister: Speak for yourself!

Inche Ahmad Bin Ibrahim: The colonial officials that stand behind the Government have, I am sure, no objections to the Socialist speeches made by the Chief Minister if it will fool the people, but they will surely object to Socialist action. And the Chief Minister probably finds that he will have to displease his friends, and so we have a Budget that is no different from many that came before this. When expenditure envisaged by this Budget is completed, the Labour Front would have had 20 months of office, that is, if no more revolt takes place in the Party. The Labour Front Programme - the four-year one - would still be unborn -

The Chief Minister: Who prepared your speech?

Inche Ahmad Bin Ibrahim: I did.

Mr Speaker: Order, please.

Inche Ahmad Bin Ibrahim: Probably all the Socialist promises by the Labour Front are going to be crowded into the last 28 months of its term if the Chief Minister calls for new elections in 1957, as he has promised. Then, of course, he can claim he did not have the time to fulfil his promises - I mean, those promises that he did not have to break for the good of the country.

The people living in the rural areas, I am sure, must be happy to know that the Government considers the Rural Board self-sufficient. Increased rates will not mean improved services but just a reduction of Government expenditure. This is indeed a novel way of fulfilling the promises made during the elections. It is a new way of rural development.

As for the expenditure in the Development Estimates, I am afraid I do not see the purpose of allocating $4.4 millions if more than $2.5 millions is unlikely to be spent. I refer to page 8 in Cmd. Paper No. 28. This, I think, is cheap deception but the Government has -

Mr Speaker: Order, please. The hon. Member must not use the words "cheap deception" here with reference to the Financial Secretary or any Member of the Government. Will he please withdraw those words?

The Chief Minister: He is a P.A.P., Sir!

Mr Speaker: Order, please.

Inche Ahmad Bin Ibrahim: It does not matter whether the P.A.P. -

Mr Speaker: Order, please. Will the hon. Member please withdraw the words "cheap deception"?

Inche Ahmad Bin Ibrahim: I withdraw the words "cheap deception", but the Government has so much to be ashamed of that it might not matter to them.

Mr Lim Ching Siong (Bukit Timah): Mr Speaker, Sir, the Labour Front claims to be Socialist. It is always talking about its Socialist programme, but what I want to know is, does the Labour Front consider this Budget a Socialist Budget?

The Chief Minister: A beginning.

Mr Lim Ching Siong: Can the Chief Minister, with his capacity for self-deception, convince himself that it is really a Socialist Budget?

The Chief Minister: Point of order, Sir. As the P.A.P. -

Mr Speaker: Order, order. Sit down, please, Mr Chief Minister -

The Chief Minister: - is very fond of deception, I would like to counter it.

Mr Speaker: Perhaps the Member for Bukit Timah did not hear me when I reproved the hon. Member who last spoke when he used the word "deception". It is not a parliamentary word and I must ask him to withdraw it. He must not use the word "deception".

Mr Lim Ching Siong: Mr Speaker, Sir, I withdraw it. I do not want to give a lesson in Socialist economics. The Nominated Minister for Communications and Works will do that.

The Chief Minister: Can you?

Mr Lim Ching Siong: Yes.

Mr Speaker: Order, please. I know that the whole debate is becoming very trying, but can I remind hon. Members of another Standing Order? I have referred to quite a number of them today, but the Standing Order I have in mind is Standing Order 37 (4) which reads:

"While a Member is speaking all other Members shall be silent and shall not make unseemly interruptions."

Carry on, Mr Lim Ching Siong.

Mr Lim Ching Siong: I will point out to the Nominated Minister for Communications and Works (Mr Thomas) that a Socialist Budget must aim at a redistribution of income. This is generally done by an increase in direct taxes and increase in social services. The Chief Minister probably knows that this Budget does not even attempt this. After all, it was drawn up by the Hon. the Financial Secretary, who is neither a Socialist nor a member of the Labour Front. He is a colonial official. Therefore, we can have Socialist speeches by the Chief Minister while the Financial Secretary quietly gives us a colonial Budget.

Mr Speaker, Sir, the Estimates of Expenditure proposed show clearly that the basic policy of a colonial government can never change. It does not matter who carries out the policy or who appears in this House and offers the justifications and the apologies. It does not matter whether they are the Progressives or the Labour Front. Nor does it matter whether they call themselves Socialists or capitalists. If they accept the colonial system, then their programmes are always the same. They may use different words to explain the same things. They may think that they can fool the people with pretty words, but action will show they are humbugs and that is what this Budget shows.

The colonial policy has been to encourage English education and cut the people of this country from their cultures and traditions, so that they will be really stooges of the colonial masters, and so that they will be cut away from the masses of the people and have no choice but to throw in their lot with the foreigners they have been taught to ape. The Labour Front is carrying on this policy -

The Chief Minister: You lie!

Mr Lim Ching Siong: $59 millions is to be spent on education. This includes $11.4 millions in the Development Estimates. Out of this, only $1.7 millions will be spent on Malay education and Malay schools, but even all this money will not be spent on Malay education. $600,000, or one-third of it, is for the purpose of teaching English in Malay schools. This means only $1.1 millions, or less than two per cent, will be spent on the teaching of the national language. We see in the Development Estimates that $35 millions is being spent by the Public Works Department for building schools. Of this sum, $300,000, or less than one per cent, is being spent on Malay schools. Of the $10 millions that is to be voted, only $50,000, or half per cent, is for Malay schools.

As for the building of Chinese schools, the Government does not even plan to spend a single cent. The Singapore Chinese Girls School, which is to get $20,000 from the Education Board, is not a Chinese school. It is an English language school.

We are told to expect great things from the All-Party Report on Education. We can see in the Budget proposals here what the Labour Front thinks about national education, or at least what their back-seat drivers think. This shows us that we must not expect anything from the Report. It will be one more of the Labour Front's promises that have to be broken "in the interests of this country"; but, Mr Speaker, Sir, let me tell the Government and the Minister for Education that they cannot fool the people by their pretty speeches -

The Chief Minister: We leave that to the P.A.P.!

Mr Lim Ching Siong: The people know them for what they are. They know that these men are just spokesmen for the colonial government. Their thinking is done for them by their European officials. Therefore, Mr Speaker, Sir, may I advise the Minister for Education to have the courage to withdraw this insult to the people of this country and offer us an estimate of expenditure on education that will meet our national aspirations? Let me suggest that he does some thinking instead of having it all done for him by the colonial officials.

Mr Speaker, Sir, before I sit down, I would like to draw your attention and the attention of the Minister for Health to some of the items in the Estimates. Cmd. Paper No. 28 boasts that because of economies in expenditure, it has been possible to reduce Government's contribution to the Hospitals Board. What are these major economies? Expenditure on food and medicines for patients has been reduced. Nearly $500,000 have been saved in this way. I would like to know how many Members of the Government are proud of such an economy? Is the Chief Minister proud of it? Or did he not know?

Mr Francis Thomas: We have heard, Mr Speaker, Sir, from the Member for Bukit Timah (Mr Lim Ching Siong) that he believes the thinking of the Government is done for them by colonial officials. It is not, of course, the case, but I certainly think a very good case could be made out to provide some colonial officials to do the thinking for the Opposition, because their thinking is really very poor quality indeed. They could well do with some to write their briefs for them.

In the course of my work on flood control, I was reading recently a little article by Chang Wen-kuang of the Paoting Special District in People's China. He did not teach me much about flood control, but he made one very useful remark on general principles. He objected very strongly, Mr Speaker, to "certain people who pay no heed to the existing situation and formulate their plans blindly"; and I feel that these words "pay no heed to the existing situation and formulate their plans blindly" might well be embroidered on a banner and hung over the heads of the Opposition, because I have seldom heard so many speeches which took no account of the situation and which, as far as they formulate at all, were formulated with a more than myopic blindness.

There are one or two points of detail with which I would like to deal but I think, first, I might clear up a misapprehension in the minds of the Opposition. It has appeared again and again. I expected it from the - is it still Progressive or are they merged? I do not know. We still use the word Progressive -

Mr William Tan: Keep to your point.

Mr Speaker: Order, please.

Mr Francis Thomas: The anonymous Parties of the Right. I expected from them that they would not know what Socialism is about, but I am disappointed to find that the Member for Tanjong Pagar (Mr Lee Kuan Yew), and following him other Members of his group, also lashed out, in misapprehension, at the nature of Socialism.

I do not wish to give a lecture on Socialist economics although I have been invited to do so by the Member for Bukit Timah, but I do think they ought to find out what they are talking about before they talk. Socialism is not a welfare state. A welfare state is not Socialism. A welfare state may be a transition stage where a Socialist arrives at some point. In Russia, the welfare state is still "pie in the sky". The Russian Socialist Government imposes a very low standard of living in the interests of accumulating more capital. Communist China is following on the same lines. In Great Britain, the Democratic Socialists - the Labour Party - put the welfare state first and progress towards other parts of Socialism later. It is a complete mistake - and I say it with regret because I thought we had some people in the Opposition who knew what Socialism was - to believe that the welfare state is the first objective of Socialism. It is not. I cannot give a full lecture on Socialism but in this context of Budget work the essential facet of Socialism, on which I will ask the so-called Socialists of the Opposition to fix their minds, is that we must apply the techniques of technology and planning on a national scale. That is the basic facet on which other aspects of Socialism are going to depend.

The amiable suggestion by the Member for Tanjong Pagar that all the money in the world that we could possibly raise be instantly seized and spent - "$60 millions on flood control! Have it straightaway! Good heavens, give it to the City area alone! Never mind the rest of the island! Let us put $60 millions into the City area! We have not got a plan yet? Never mind! Spend the money! There is no need to have plans and no need to survey the island! No need to find out where the water comes from and where it goes to! No, just spend the money! No need of putting it in the Budget at all! Have some boldness, audacity, temerity, courage! Do not run away!" Oh, it was a lovely speech! What he meant by it was just nothing at all. Does he seriously think that we are going to spend $60 millions without having a proper survey and a proper plan? He may be a man who does that sort of thing, but I certainly do not think that a responsible government can do it.

Mr Lee Kuan Yew: How about getting the plans quicker?

Mr Speaker: Order.

Mr Francis Thomas: I have already informed the House - I think the hon. Member was present - that planning and surveying throughout the year has been going on and one plan has been presented and is now being implemented. Next Wednesday the plan will go into action to deal with the small-scale flooding in the Bedok-Ketapang area, and that is the first stage. It is a relatively small thing. It does not cost $123,000 as he thought. It costs $523,000, $400,000 more. He has not studied the Estimates with quite enough care perhaps to see what the total cost is, but that is the total cost as shown in the Estimates. If he or the Member for Tanglin, who talks on such similar lines, would like to come along at 8 a.m. next Wednesday, the 23rd, to the 8th mile, Changi Road, I will arrange that they can come with me and see the start of a nice little flood prevention scheme for that little area. They will have time to get back and change before the Assembly meets afterwards, I hope.

Perhaps, since I am talking about flooding, I might mention another aspect because this is one thing that several Members have spoken about. I am also arranging for the Chief Drainage Engineer to visit Lorong Tai Seng shortly and to give a little lecture to the farmers on what they can do in the way of self-help. They have made some attempt at self-help already, but unfortunately they did not quite know what to do. They did it rather the wrong way, but I hope shortly to be able to arrange, now that the levels have been taken, that they can be apprised of what they have to do to help themselves. I shall try to be present for that lecture and if any hon. Member would like to come, I am sure the people of Lorong Tai Seng would be delighted to see him.

The main problem about this flood prevention is one which I have explained before, but it seems impossible for the Opposition to grasp it. It is that you have got to get the water off the island. It is no use merely shifting the water from one place to another on the island and drying one place in order to drown another. You have got to get it off the island. Now, the development of Singapore is such that you find roads running across all the points at which the water has to get away. You will also find in housing estates all kinds of complications. You cannot just dig a whacking great drain out to sea: you cannot get the water away without very costly, and very lengthy works. In due course, Flood Control reports will be available and they will be tabled in this House. Members can then discuss them. They can look into the cost involved and if the Member for Tanjong Pagar feels so strongly that $60 millions for flood prevention is chicken feed or peanuts, well, by all means let him get up and urge that we spend the money and justify it against all the other costs that will have to be met as well. If he is so confident the money is there, perhaps he will show us how to get it and advise - oh, very cleverly - advise us how to dispose of our available money without depriving any other essential Government service of the money which it needs.

Now, the Member for Tanglin raised a point about the extravagance in Government building. He was very much disturbed because he said that the Government had done nothing, since it came into office, to deal with this problem of extravagance in building and the wasteful use of materials. He made quite a heart-rending little speech about it. Unfortunately, he does not know what he is talking about. If he had asked me beforehand, "Have you done anything?", I would have given him all the details, but he has not asked me and so he has exposed himself to a reply which I hope will give him great satisfaction.

It was very soon after we came into office that we first started discussing the cost of Government buildings, because it was obvious that we would not have enough available funds to deal with all the things that had to be done, and it was obvious that we could cut something off the cost of building. Some months ago a file was opened in my Ministry. The matter has been discussed and dealt with and we now have taken what, in effect, is a complete overhaul of the machinery by which plans for buildings are dealt with. We have the Public Works Standing Committee which has been given additional powers to ensure that planning is not wasteful, and to ensure that when heads of departments put up a scheme, they will not put up an extravagant or unnecessary scheme. We also have a special Working Party on the cost of building schools. We also have a special working party on the cost of building medical units - hospitals and other medical buildings - and finally we are in the process of setting up a high level Advisory Panel representing the Government, the City Council, the Singapore Improvement Trust and private experts who will advise the Government; firstly, on means of reducing building costs in general; and, secondly, on any project which is scheduled to cost more than $1 million. So when the Member for Tanglin says that nothing has been done, I can only tell him that a great deal has been done and I hope, in due course, he will see the fruits -

Mr John Ede: When?

Mr Speaker: Order, please.

Mr Francis Thomas: Well, that is the point I am just coming to. You see, here again, you have this thing of not heeding existing conditions and formulating criticisms blindly. If you will think of it, any project necessarily involves a year or even two years in the planning stage before the actual building starts to go up. If our Working Party said, "This school has just got the foundations laid out but we are now going to cut it out. Or we will decide to have the classroom a little bit smaller or take a little bit off the width of the corridors", you would tear up a year's work, tear up your contracts. You would be frightfully wasteful and uneconomic. The only thing to do is to put your Committee to work on your future planning, meanwhile carrying out your existing plans, except that when they are at an early stage they can be changed. Therefore, it is impossible, I am afraid, to promise you that when a Committee is set up today, there will be no more extravagant building tomorrow, because although you could stop the extravagant building you would also put a complete stop to the whole building programme, and, therefore, it is necessary to take time. I know that time is a thing which the Opposition is reluctant to allow us, but I am afraid they will have to put up with it.

There is one other point about the so-called extravagance of Government buildings. You must remember that the Government builds in the public interests and has to maintain buildings from public funds, and if the buildings fall down or become unusable, they will have to be replaced from public funds. But the private builder does not do that. He builds largely for sale, and the maintenance costs and so on then fall on the purchaser who, if he is foolish enough to buy a house that falls down, has apparently very little remedy in Singapore. The Government should not go below a certain reasonable standard of permanence and soundness of construction, or else we will be faced year after year with additional and unnecessary costs for maintenance and repair, and finally we will be faced with high costs of replacement at an early date.

That deals with the major points raised by the Opposition on the things that concern my Ministry most, but I think I might deal briefly perhaps with another thing. There seems to be some confusion in their minds in that a lot of references were made to the social services, and it is with reluctance that I, once again, feel myself impelled to give instruction to the Opposition. I wish they would instruct themselves and then we shall all save time. It would be, to my mind, unwise to lash out into extravagant expenditure on social services until you have got what stands first in our Labour Front Programme, and that is a survey of the national wealth.

In Great Britain, you have got a reasonably adequate survey machinery. The economists complained that it was not adequate but they managed to produce some figures all the same, and they were able to say that the total capital expenditure on fixed assets in Great Britain was so many hundred millions in one year, and so many thousand millions in another year. As you could break that down into the various headings under which it was spent, you can then see how much you are actually spending on fixed assets for social services. In Great Britain, the social services, as a whole, come to around 30 per cent of the total capital expenditure on all fixed assets, and of that 30 per cent, about 23 per cent goes on housing. I have not got the detailed figures. I have them available in my bag but I will not waste your time with them.

Housing is a very, very essential social service. It is almost basic in the social service programme because, unless you get your housing done, you are going to have a slum population and a slum population is a political and economic liability. Some slum dwellers in Singapore - a remarkable number of them - manage to rise above their environment and maintain proper standards of behaviour and cleanliness, character formation and so on, but by and large, the pressure of life in the slum is such that, scientifically speaking, it does cause the population to deteriorate as human material. You get an irresponsible, unemployable, uneducable, dull, backward, and criminal population which is a permanent liability to that part of the population which is employable and productive and it is most important that you should get rid of your slums as a matter of first priority.

Education and health services are, of course, social services. I do not think we need deal with them at very great length, but what you should not forget are the basic social services without which all the others could not exist. Those basic social services are water, light, roads, fire services, drainage, sewerage, telephones, postal services, prisons, harbours, airports, barracks and accommodation of that kind, and all the offices and equipment which the public service needs. These are often overlooked but they are, in fact, basic social services.

Now, the last "blind formulation" of the Opposition which I would like to deal with came, if I recollect rightly, from the Member for Tanjong Pagar, I think. He addressed us with all the bounce and the jolly cheekiness of a sixth form schoolboy in his debating society. He made his usual little joke about the Member for Tanglin Club (Mr Sutherland). He has made it about ten times now. It still amuses him although it has become rather stale to the rest of us. He made his usual little jeers and some jibes and he promised us a lot of constructive criticism. But when it came to the point, nothing constructive emerged at all except what he had copied from the Member for Tanglin. There is a very remarkable similarity between their two speeches -

Mr Lee Kuan Yew: Dear me, dear me!

Mr Francis Thomas: And you may well say, "Dear me", because it was really quite pathetic. I thought, hopefully, that soon after the little jokes, he would get down to something constructive. But, Mr Speaker, Sir, we got nothing constructive except a wild statement that you could impose taxation; you could do a lot; you could tax up to the maximum; you could mortgage your future; borrow up to the hilt - I do not know how you propose to pay - ten per cent or twenty per cent on the money you are borrowing? What rate are you going to pay? Well, do not mind about that! Borrow the money! It does not matter what it costs! Let us get the money in! Spend it at once! Never mind about the future because the present is so terrible! We cannot get on! Well, it is a point of view, but it is not a very fruitful one. What he was aiming at, I think, was a Socialist redistribution of income in which we were going to arrive at an egalitarian society. I think I am representing him correctly. Well, he is not certainly going to redistribute our income very rapidly by those techniques of fiscal policy. The effect of his redistribution would be to distribute our income to all the other countries of the world and to leave us in a state of abject poverty. I do not think that that was his intention, but that would probably be the result of the sort of fiscal policy which he envisaged.

As for the egalitarian side of it, we might all be left in an equal state of misery and poverty, but I do not think that is what he wanted us to be in. I think he would prefer us all to be prosperous and well. In any case, the egalitarian idea is one which is accepted by practically no Socialists in the world today, except a few armchair Socialists. It has been abandoned in Russia most emphatically. It is being rapidly abandoned in China. It has never been accepted in Great Britain. It was never accepted in Australia under its Labour Government. In fact, I do not think you can point to any place in the world where the egalitarian idea remains in the Socialist programme. Whether it is possible is one thing. Whether it is desirable is another. But as an immediate objective for a Socialist Government, I do not think it has got any value at all.

Mr Goh Chew Chua (Ponggol-Tampenis): Mr Speaker, Sir, I sat here in the morning and heard with considerable surprise some of the speeches. Most of the speakers are not known for their Left-wing views and yet they seem to be more Socialist than the Labour Front. The Progressives have become greater champions of the under-dog than the Socialists of the Labour Front. Mr Sutherland, the Nominated representative of capitalism, is the champion of increase in income tax while the Labour Front can only call out "Peace in the sky".

The Chief Minister: "Pie in the sky"!

Mr Goh Chew Chua: What has happened? They are out-labouring the Labour Front, just like the Progressives did during the Assistant Ministers crisis. Probably the Government is happy at the turn of events. Now there are no major difficulties to extend the Coalition. There will be no need for soul-searching and justification. The Progressives and Democrats can join up with the Labour Front. It may be that these Parties will have watered down some of their Socialism to accommodate the Labour Front. After all, the Progressives planned to build seven district hospitals, or was it only six? The Labour Front has only one to offer us - that a paper one, not a house made of bricks but a paper one. It reminds me of a paper motor car they burn at Chinese funerals. I hope this hospital is not made for burning at the political funeral of the Labour Front. If the Government goes on at the rate they have been going till now, the funeral will not be far away.

The Government seems to have forgotten that a large number of people live in the rural districts and with all sorts of services. All of it cannot be done in a year, but we expect to see a start. It is the absence of this that has disappointed most of us. They need pipe water, electricity and medical services. The Budget does not show that the Government is even thinking in these terms. The Government thinks that it has to deal with a standstill Budget. They spend the same amount of money as they did last year. But they seem to forget that the population in the rural areas is not at all at a standstill. It is growing and therefore per capita expenditure is reduced. The services available to the people in the rural areas will be reduced. Therefore, it is a retreat Budget and not a standstill one.

About a month ago, the Hon. the Minister for Communications and Works (Mr Thomas) informed this House that nearly $60 millions is needed for flood control. But in this Budget, they want to spend only $163,000 -

The Chief Minister: Copy cat! It is $500,000.

Mr Goh Chew Chua: $163,000 is mentioned. Flood control should have more priority than a Special Branch building. Probably as far as the Government is concerned, the Special Branch is more important than flood control. After all, flood control can only save farmers from a periodic loss of all their belongings, while the Special Branch can help to save the Government from political opponents -

The Chief Minister: You are a dishonest liar!

Mr Speaker: Order, please. If it is a point of order, Mr Chief Minister, please rise on a point of order.

Mr Goh Chew Chua: - a thing that is going to be progressively important.

The Chief Minister: On a point of order, Sir. Is the Member permitted to read from somebody else's speech?

Inche Ahmad Bin Ibrahim: Nonsense!

Mr Speaker: I have noticed that the Member for Ponggol-Tampenis is probably referring to his notes a little too frequently. But please carry on, Mr Goh.

Mr Goh Chew Chua: A thing that is going to be progressively important as more and more election promises are broken.

Mr Lim Koon Teck (Paya Lebar): Mr Speaker, Sir, I had not intended to speak this afternoon, but the remarks of the Hon. the Minister for Communications and Works have prompted me to do so. He says that building of all these works takes time. We agree that it takes time but we also must think of the money that is going to be spent next year.

In the Budget, we have now a sum of approximately $30 millions provided for expenditure under the Head: Public Works Non-Recurrent. Now, why do we not propose to ask for this amount to be cut down? The answer is because we also realise that today we have to look after the under-privileged, and everybody will have to face up to taxation. Still, we want to see that, for the expenditure of this amount of money, we must have at least double the ac- commodation. During the last few years, we have heard the Public Works Department lower the cost of quarters for the rank and file of the Police from $10,000 to $5,000 each. This is a very great achievement and, to my mind, there is no reason why such standards cannot be applied to the quarters now designed or provided in the Estimates for Division I Officers, or for Police Superintendents for whom provision of $45,000 per quarter has been made.

Now unless we do so and do it straightaway, we are going to throw away millions and millions of dollars which we can ill afford today. Strangely enough, during the last two occasions, I have found myself in agreement with the Member for Tanjong Pagar (Mr Lee Kuan Yew) when he said that a change in the name of the department must involve a change of heart. I must ask the Minister and his officers to look at the whole programme of development in an entirely different light. Do not think that because you put up substantial buildings, like Fullerton Building, on which a tremendous amount of money has been spent, or substantial buildings like the General Hospital, you are going to save maintenance expenditure, because in the Estimates there is $1,200,000 to be spent on renovation and alteration to Fullerton Building and $2 millions for the General Hospital. Now, is it necessary to spend all this money on renovation and alteration? What saving is there to have built such huge buildings to last a thousand years? None, because we have now to spend $3,200,000 which is exactly the amount which will be required for the very, very urgent district hospital at Kallang for which only $100,000 has been provided in the Estimates.

I want to take up this question of the district hospital at Kallang. About two years ago, after a lot of complaints that people had to travel a long way through a crowded town to get treatment at the General Hospital, especially for those who live in the Katong and Serangoon areas, the Progressive Party suggested that, as soon as the Terminal Building of the Kallang Airport was vacated, it should be turned into a district hospital. I do not know why this has been completely turned down. Immediately after the election, I think the Hon. the Chief Minister said that this building was going to be used as a transit camp for persons displaced by fire or by a benevolent Government who want to build new houses. I think someone has since persuaded him that this building is too good to be used as a transit camp. I ask, what use is this going to be put to? I find that it is to be used not as a district hospital but as headquarters for the Malayan Auxiliary Air Force.

The Chief Minister: No.

Mr Lim Koon Teck: It is down in the Estimates. Very well, if I am wrong I will withdraw this point.

The Chief Minister: Only the hangar.

Mr Lim Koon Teck: Very well. I will not pursue this point if I am wrong. Reading the Estimates, that appears to be so. But I do maintain that this building is eminently suitable as a district hospital and it can be started within three months. The provision of $1 million to convert this building would turn it into a first-class hospital and the other $2 millions could be used for district hospitals which are sorely needed in the rural areas.

I would urgently request that the Minister try and change the whole system of building. I myself have taken it up as a hobby and I know there are ways and means of putting up a building which can be done at half the cost of what is being done today without any danger of collapse.

The Minister for Education (Mr Chew Swee Kee): Mr Speaker, Sir, once before I said that hon. Members used to come here with prepared speeches and, in fact, talk nonsense. In this connection, I am dismayed to see that some Members have not studied the Budget, have not studied the Estimates at all, or even read them correctly. I am referring to the remark made by the Member for Bukit Timah (Mr Lim Ching Siong) that only $300,000 is provided for Malay schools. Well, he should know, as an elected Member of this Assembly, that Malay schools are Government schools. The $300,000 referred to by him appears under Head D 48, subhead 5 in the Development Estimates. It clearly reads: "Improvements and Extensions to Malay Schools". That does not indicate that the Government is going to spend $300,000 on building one school or two schools. It is going to be spent on extensions and improvements to the existing Malay schools.

The Member for Tanglin (Mr Ede), and I think the Member for Serangoon (Mr Lim Choon Mong), referred to the fact that no new provision has been put in the Estimates for secondary schools. Well, no new provision is required because $1,200,000 is available as a revote from 1955. It would be unrealistic if I were to put in a figure of, say, half a million dollars for two schools when actually the Government cannot hope to construct those buildings. Now, we have - and this formed part of my answer last time, I think - seven secondary schools. Two will be completed in 1956 and plans have been started for the construction of two more secondary schools. I should tell hon. Members that we put into the Estimates what the Public Works Department can do during the year, instead of putting in some unrealistic figure and thus boost up an unrealistic deficit. I would not claim credit for that kind of thing.

The Member for Tanglin also says that in Group A in the Development Estimates there are 36 schools, and the cost of each averages $10,000 less than that of the 18 schools in Group B, but he forgets the fact that the cost is determined not only by the building but also by piling, the approach roads and other factors. Foundations may raise the cost in some cases, and extensions to road work may increase it in other cases. So it is impossible to lay down the average cost just by dividing the amount of $8 millions by 36 schools and $4 millions by 18 schools.

The Member for Seletar (Mr Nair) criticised Government for a project to build a $2 million library and bemoaned the fact that Government has not provided any branches. Well, I would suggest to the hon. Member that he read his papers daily and that Government has, in fact, three library branches - one at Serangoon, one at Joo Chiat and one at Siglap -

Mr Nair: Still inadequate.

Mr Chew Swee Kee: No travelling libraries are at present run by the Library but it is intended that there should be, though the travelling and branch libraries would not, in my opinion - and I am supported by a most efficient Librarian - reduce the need for a central library.

When the Member for Bukit Timah criticised the Government for not spending a single cent on any secondary school, I think his idea was only to invite publicity. I would advise him to come to me for the information that he wants, which is that in Group C, out of the 18 schools, one will be for a primary Chinese school and another for a secondary Chinese school.

The Minister for Health (Mr A. J. Braga): Mr Speaker, Sir, it has been pointed out by some hon. Members today that nothing constructive has come from the Opposition in spite of the very lengthy speeches that we have heard. That sentiment I thoroughly endorse.

The only constructive - if it may be called constructive - suggestion that has been made is by the Member for Paya Lebar (Mr Lim Koon Teck) in connection with the use of the Airport Terminal as a hospital which I shall deal with in due course.

The Member for Serangoon was very free with his criticisms of the Medical Department. I can only say that he and also the Member for Tanglin (Mr Ede) are quite used to casting and slinging mud without ascertaining facts. It is a hobby and a habit with them. The Member for Serangoon made a statement that despite alterations, as the Budget shows - Expenses, Alterations and Additions to Hospitals - there is not a single increase in beds. That is absolutely wrong.

Mr Lim Choon Mong: Give me your figures.

Mr Braga: All alterations are designed to increase the number of beds. In the General Hospital, every alteration has increased beds. Additional beds as a result of alterations and additions are 75. That is an exact figure, although the return from the General Hospital showed about 107. I am being conservative in saying that the increase there by alterations is 75 beds. This figure does not include the new Mistri Wing of 300 beds. Alterations and additions are now commencing in Kandang Kerbau Hospital to provide for extra beds.

Mr Lim Choon Mong: How many beds?

Mr Braga: Come to me on another day and I will give you that information. Another remark he made as a result of his rather loose thinking is the question of wards being built with air-conditioning. Let me assure him that the new air-conditioned wards in the General Hospital for first-class and second-class patients completed early this year were planned by the previous Government. It is the intention of this Government to provide one class of accommodation for patients with minimum comforts, and air-conditioning for medical purposes only. Those who wish to have air-conditioning will have to seek that amenity elsewhere.

A further statement he made which is wrong and which I wish to correct him is the creation of extra posts in the Budget. He gave as an example posts for five Radiologists. It is necessary to create extra posts even though there are still vacancies because we are sending our locally domiciled medical men abroad for further education (for F.R.C.S. degrees) to fill higher posts, and it is therefore necessary to have these posts vacant when they return. Let me refer the hon. Member to the White Paper No. 40 of 1954 which was a report of the former Government under the chairmanship, I think, of Sir Han Hoe Lim, and which report was adopted. It said:

"It is necessary, of course, to ensure that when the four officers are sent on scholarships, there shall be vacancies for promotion on their return."

On the 5th of July, 1954, that was implemented by another circular from the Chief Secretary:

"That in making proposals for the award of scholarships to their departments, heads of departments are required to ensure that there will be vacancies to which the scholars may be promoted on their return to duty after the successful completion of their course of study."

Later, this directive was further amplified by this Government on the 17th of August, 1955, when referring to scholarships. It said:

"The basis for award is that the individual officer shall be assisted thereby to gain an Honours degree or equivalent primary qualification which will make him eligible for immediate promotion to a higher appointment in the public service",

and referring to the Fellowship courses, it stated:

"The basis for award is that the individual officer on not becoming immediately eligible for promotion on the successful completion of his course of study shall be assisted to attain the necessary post-selection or postgraduate or special professional qualification for eventual promotion to a higher grade of post."

It therefore follows that if, in any one case, it is decided by this Assembly to delete the provision for a new superscale post, the effect will be to prevent local officers proceeding overseas for higher studies during the coming year.

Now we will go to the reference made to the hospital at Kallang which has been loosely referred to by the Member for Tanglin (Mr Ede), and I believe by the Member for Ponggol-Tampenis (Mr Goh Chew Chua) who called it a paper hospital. I can only suggest that the Member for Ponggol-Tampenis is used to burning paper houses as a hobby. I have already made a public announcement that the Government intends to build a district hospital, and since my filling the post as Minister for Health, I have sought proper sites. The first site we thought that might be used was one in Katong Road, somewhere near the Post Office, which is a coconut plantation, but we found it a little too small and required a lot of piling. Subsequently, we thought that the site on the vacated Kallang Airport would be a useful one and after tests had been made, we found it suitable. The Member for Paya Lebar (Mr Lim Koon Teck) suggested that the Airport Terminal could be used for a hospital. Let me assure him that it is much, much too small to be used as a hospital. The site that I hope to acquire and on which I hope to build my hospital when plans are ready comprises an area of fifteen acres. The Member for Paya Lebar says that he has taken up building as a hobby. I think it is more than a hobby when he suggested that we should build cheaper hospitals and I can assure him that we do not require his services to build cheap hospitals. Under Head D 52, subhead 10, item 4 of the Development Estimates gives a vote of $100,000 for this district hospital, but the estimate that is allowed for it is $3,200,000. That $100,000 is only to cover the work which we anticipate will be completed in 1956. If indeed we have done more work than necessary, we can always go back to the original Estimate and ask for more. There is nothing to prevent us exceeding the $100,000 voted, because we have already estimated, as I have said, $3,200,000.

Now, the cottage hospitals that were suggested by the Member for Tanglin (Mr Ede). This may show him where he is wrong. He said that the Progressive Party, or the previous Government, had suggested cottage hospitals. The suggestion that was made in the Progress Report of the Medical Plan for 1953 was for outpatient-cum-cottage or district hospitals, and it went on to say:

"The Colony population is increasing at such a rate that it is intended now to develop outside the centralised medical institutions ..."

though the population has increased considerably since 1953. This goes on to say:

"Each of these new divisions would be so designed that they could be expanded into full-sized hospitals to meet the growing needs of the increasing population."

That is exactly what we are doing with the new hospital at Kallang. The new hospital at Kallang is planned to provide for 250 beds in the first phase, and to increase to 450 beds when funds and staff are available.

Lots of criticism have also been launched against the increase that has been provided for in the Budget under the Medical Heads. This increase under Medical Head D 52 is to keep up with expansion which is daily growing and considering the scope of expansion, the increase of less than half a million dollars shows that a real effort has been made to cut out all but essential expenditure.

Mr Goh Tong Liang (Bukit Panjang): Mr Speaker, Sir, when I raised my hand just now signifying my intention to speak, I believe the hon. Members opposite must have made up their minds that I was going to deliver a very long and hot speech. I think they will be disappointed.

But coming to business, it would appear, from the Development Estimates for 1956, that provision for all necessary things has been made for the rural areas. They are only left to be implemented. But there are two things, I observe, that have been overlooked by the Government. They are electricity and telephones. I know quite a lot of villages which have no such facilities at all. In my constituency, particularly, there are seven villages without electricity and telephones. The inconvenience suffered by the villagers as a result of this, I think, had better be left to the imagination than narrated. I have brought this matter up once or twice before in the Rural Board, but it seems nothing could be done because of technical factors and economics. Well, Sir, we are no technicians; we are no economists; we are "orang2 ulu" pure and simple.

The Chief Minister: Did you say "orang bodoh"?

Mr Goh Tong Liang: "Orang ulu". This much we know, that it is the duty of the Government to provide services for the people. Without wishing to be sarcastic and acrimonious, I do hope the Government will seriously look into the matter and provide all these facilities as soon as possible - that is, electricity and telephones.

There is one bouquet for the Government, and that is, as far as water services are concerned, it seems the position is quite fair, but there is plenty of room for improvement.

Mr Speaker: Mr Hart, in reply?

Mr Hart: In reply, Sir. A great number of the points which have been raised in this debate have been answered by my colleagues on the Government Benches. A number of them are the subject of motions which will be taken in the Committee stage, and I think I can, in all fairness, say that the bulk of the remainder could be answered by a careful reading of Cmd. Paper No. 28 of 1955, of my speech on the 9th of November, and of the Estimates themselves. I will, if I may, take this opportunity to answer some specific points which were made in the course of the debate and which have not yet been replied to in full.

First of all, the 1954 accounts mentioned by my hon. Friend the Member for Seletar (Mr Nair). These were completed in May, the audit was finished in August, and they are now in the hands of the Printer and will very soon be in the hands of Members of this Assembly.

As regards the question of the investments by the Special Reserve Fund, I deplore, just as much as the Member for Seletar does, the depreciation in value of the Special Reserve. I would point out, however, that it is a long-term reserve. We hope that we will not have to realise it for some time to come and there is reason to hope that the value of the securities in which it is invested will have appreciated by that time. There are certain advantages in investing these funds overseas. They are invested in the London market. They can be realised as and when we want them. I do not think funds invested in Singapore would have that same liquidity. If they had been invested in Singapore, I would not like to speculate as to their value at the present time.

We have been accused by many Members on the other side of not having practised what we have preached in our various statements throughout the year about the necessity for economy in the Government service. Now, I do not think that that is altogether fair. In drawing up the Estimates this year, we have made strenuous efforts to limit Government recurrent expenditure as much as possible. If Members will look at the Estimates, they will see, apart from some extraordinary items like contributions to the Central Provident Fund and increased provision for grants in aid to Chinese schools and so on, that the recurrent expenditure has been kept within the level of the 1955 Estimates. Now, that in itself represents a very considerable economy when one takes into account the natural expansion of the government machine during the course of a year, and I can assure Members that heads of departments will be required to keep within these limits.

Again, I think Members will see, if they look with care at the Estimates of Expenditure, that very considerable economies have been effected in Special Expenditure. Our Special Expenditure in 1956 will be reduced to $16 millions, excluding revotes and a contribution to development. That represents a very considerable economy. It has been achieved by asking heads of departments to exclude from their estimates provision for any service which is not absolutely imperative in 1956 and which can be postponed until a later year, and to exclude any provision or service from the Estimates which cannot be spent owing to delays in drawing up plans, or for items when they know cannot be delivered in 1956 even if ordered. The object of this exercise is to ensure that the money which we have available in 1956 will be used to the best advantage, and that the Estimates of Expenditure will not be inflated by items on which money cannot be spent and which would, by their very existence in the Estimates, freeze funds.

As regards personal emoluments, we have been accused that we have failed to cut down the number of new appointments, and that the Government staff shows no tendency to decrease; that it, in fact, has increased at a rate faster than in previous years; and that a very considerable amount of money is being spent on expatriates and so on. Well, Sir, I can say, in all earnestness, that we did go through the Estimates of Personal Emoluments this year with a fine tooth-comb and also took out of the Estimates any appointments or proposals for new posts which were not regarded as absolutely imperative for the efficient conduct of government business in 1956. We did, at the same time, take into account the fact that to implement the development plans of the social services, extra staff would have to be provided, but at the same time we did ensure that only the minimum of this extra staff required for the implementation of these services was, in fact, included.

As I have said earlier, I can say, in all sincerity, that we have drawn up these Estimates in such a way as to practise the maximum possible economy in 1956.

On the question of the Development Estimates, we have endeavoured to cut our coat according to our cloth. That, I think, will be accepted as very sound policy - colonial, Labour Front, or P.A.P.

Mr Lee Kuan Yew: God forbid!

Mr Hart: I appreciate from what the Member for Tanjong Pagar said earlier that cutting one's coat according to one's cloth was not a fundamental concept of the economic planning of the P.A.P. Naturally, as always happens, certain essential services have had to be held back - not abolished or abandoned - but merely held back until later in the year or until next year. This, I think, has caused a certain amount of heart-burning amongst Members of the Opposition, and certainly amongst my colleagues on the Ministerial Bench, but we have made a note to allocate any money likely to be available subsequently to those services which have, in our opinion, a high priority and I think it will be agreed that in devoting - and I am speaking from memory - 34 per cent of the available funds for capital works to Education and 25 per cent to Medical and Health, we have not neglected these services.

I have also said that, halfway through the year, we will probably find that progress in some respects has not been as rapid as we had hoped and that some savings are available. If that proves to be the case - as I think it will - we will introduce a supplementary Budget and re-allocate the money available, thus bringing forward those items which are merely noted in the Development Estimates with token votes, or perhaps which have had to be kept out of the Estimates altogether.

As I expected, when I drafted my Budget speech on the basis of Estimates showing a deficit of $22 millions, I would be accused of crying wolf once more in the established tradition of the Financial Secretaries of Singapore, but I did think that I had been at some pains in my speech to point out that the days of large deficits being converted into large surpluses have now passed and that we are now faced with the hard reality of actual deficits. I am not sufficiently foolhardy to endeavour to estimate what the actual deficit will be, and I hope that I made that clear in my speech. At the same time, I think I made it clear that there will be an actual deficit and that we must face that fact. I also tried to make it clear, and I think the figures I quoted bear me out, that unless steps are taken to reduce and cover the gap, we will be faced with an even greater deficit in the years to come, not because we have been extravagant but merely because the social service plans, which are regarded as so important for Singapore, must be implemented and that recurrent costs will increase, no matter what steps we take to reduce expenditure to an absolute minimum.

Now there were certain points raised in the course of the debate - the question of entertainment and transport allowances for Ministers - which I confess took me by surprise, because I never thought that elected representatives of the people of Singapore, who appreciate so much the value of personal relations in their commercial transactions, should have complained of, or drawn attention to, and indeed criticised, the very small amounts which were made available in the Estimates for 1956 to Ministers of the Government. But the point was raised - regrettably - and has been satisfactorily disposed of by my colleague the Chief Minister, though it will again be taken up, I fear, in the course of the Committee stage of the Bill. I will speak then at greater length on the details of the matter.

As regards hospital facilities, criticisms made of our programme for 1956 have been dealt with at length by my colleague the Minister for Health (Mr Braga). It struck me as astonishing that responsible Members of the Opposition, first of all, had not read the Estimates properly. Most of them have motor cars, and although I admit the increased tax of five cents a gallon on petrol would probably curtail their movements to a certain extent, Singapore being a small place, could they not have gone down to the General Hospital and to other hospitals to find out precisely what is being done with the money that is being spent? It struck me as astonishing to hear Members say that money spent on alterations to wards was not going to result in any increase in hospital beds. That is a most astonishing statement - that anybody in their senses would spend money on hospital facilities without meeting the major requirement of Singapore, which is an increase of beds in hospitals.

As regards district hospitals, complaints have been made that we are making no progress with the work. It has been explained that we have changed our plan and that we are now going to Kallang and I think nobody would care to question that decision, which is putting a district hospital right in the middle of one of the major centres of population of Singapore. The site that has been provided will cost no money to the Government, but the site at Bukit Panjang which would not, in any case, have been suitable, had to be acquired, as would sites in other parts of the island. That is the major advantage of putting a district hospital in Kallang, that the site is free. But before a start is made to build a hospital there, plans must first of all be prepared. The plans prepared for Bukit Panjang would not do. New plans have to be prepared, and on the site which has been reclaimed from swamp only some 30 years ago, it is necessary to sink piles which will enable it to support the buildings which will constitute a district hospital. It is for that purpose that the money has been entered in the Estimates this year - $100,000 for the preparation of the site to enable us to proceed with the building after the plans have been made.

My colleague the Minister for Education (Mr Chew Swee Kee) has dealt with criticisms which have been made of the construction of schools. Three secondary schools in a programme of seven have been completed. Tenders are now about to go out for two others. They will be completed in 1956 and sites for the final two schools in this programme are now the subject of negotiation. Rapid progress has been made in recent weeks in that connection and we confidently expect to have class rooms for all these four schools in actual operation by the end of 1956.

As regards the primary schools - 36 schools in Group A - they will all be completed early in 1956. The 18 schools in Group B will be completed in the same year, and we hope work will have started, admittedly towards the end of the year, on 18 schools in Group C. That, I think, is greater progress than has been made by any previous Government.

As regards the burning question of housing, we were accused of having made no progress with low-cost housing in the rural areas. We have not neglected low-cost housing in the rural areas. We have indeed approved plans and are about to start a pilot scheme for low-cost housing at Bukit Panjang. If that is successful, we will undertake similar projects throughout the rural areas in the island, thereby taking the population away from the centre and dispersing it close to their places of work in the rural districts in the island.

As regards the question of subsidising housing, Members are already aware that by granting loans of four per cent for 60 years and of three per cent for 40 years, we are giving a very substantial subsidy in so far as nobody could borrow on these terms for that length of time. Again we subsidise housing very considerably - and this is not new - in so far as we pay the cost of all sites, preparation, levelling, piling, and purchase - over $25,000. Now that indeed is a very important item.

Questions were asked about slum clearance. I can assure the hon. Member who raised the question that we are proceeding with our plans. We are, in fact, about to come to the Assembly with proposals for what is called by the Singapore Improvement Trust, Programme No. 8. Now that is for the clearing of slums in, I think, Manila and Short Streets and for the construction of some houses on the open ground at Kallang. That programme will cost $23.6 millions and the Assembly will be asked to approve funds for that. Out of that sum, $16 millions only will be loans and $7 millions will be subsidy. Now I do not think that can be called ungenerous - a third of the cost of the scheme.

As regards rural development, I am afraid I cannot tell you exactly just how much has been spent on capital works in the rural areas, but I can tell you how much has been provided in the Estimates for the Rural Board since 1947. Now this is a most interesting table. In 1947 the Estimates of the Rural Board showed $1.4 millions; in 1948 $2.2 millions; in 1953 it had risen to $5.1 millions; in 1954 it was $6.7 millions; in 1955 it was $7.7 millions, and next year it will be $8.9 millions. Now $8.9 millions spent in one way or another on the rural areas is quite a considerable sum, and we will of course continue to devote as much money as we can to the development of the rural areas. I have figures provided for the last two years as far as the capital development is concerned. Last year the Estimates included $3.03 millions, purely capital works in the rural areas. This year - again I speak from memory - I think it is $4.4 millions.

My colleague the Minister for Communications and Works (Mr Thomas) has dealt at length with the question of a Committee which has been set up to reconsider the standards of construction. The latest information about that is that the Committee on the standards of construction in schools has achieved very considerable economies.

There are other matters which have been raised. Although they are the subject of motions, I should perhaps deal with them. I realise that if funds for lighting of Goodwood Hill were entered in the Estimates, it would immediately cause an outcry, and I questioned this. I am living in Goodwood Hill myself! I must say that very few of the residents there have large high-powered cars. We all happen to be Government servants, and our cars are very small.

Mr Lee Kuan Yew: The Humber - a small car?

Mr Hart: I queried that provision when the Estimates came up. It was some months ago now and I asked "Why must it go in? It seems unnecessary." I will go into the matter in greater detail in the Committee stage. It is as a result of an agreement with the City Council who wish to remove the gas lighting at Goodwood Hill, and we are under certain obligations in 1956 to allow the removal of the supply of gas and to make the necessary provision for electric lighting.

On the question of land, I think that is the subject of a motion by my friend the Member for Telok Ayer (Mr R. Jumabhoy), and I will give him the necessary information in detail in the Committee stage; but, in fact, as far as land is concerned, the estimate is based very closely on the estimated requirements of various departments for development, for the purchase of sites, and for provision of sites for development purposes.

As regards the question of the acquisition and development of sites for resettlement, the Estimate is again drawn up on the same careful basis and I will give details later on.

The Chief Minister has dealt with the question of organisation and methods advisers. We are making every effort to get them, and when they do arrive I think they will be able to make a substantial contribution to effecting economies in the Government service. This is a task which really requires expert men who have had experience of this sort of thing.

The question of an Industrial Development Corporation and a research institute is under active consideration at the present time.

On the question of personal emoluments of $98.7 millions estimated this year - though not all will be spent - I cannot tell you how much will be spent on expatriate officers. I only know that they represent approximately between three and four per cent of the number of people employed by the Government.

Now, finally, we come to the question of taxation. My presentation of this item has been criticised as being irregular, unconstitutional, unorthodox. It has been said that my "Budget leaks" have increased the feeling of lack of confidence in Singapore. First of all, I should say that when this Assembly met for the first time, His Excellency the Governor in his speech said that we were going to undertake immediately a review of the revenue potential of the Colony, and in fact we were doing that. It has been given some publicity from time to time. In these circumstances, I thought it only right and proper that I should give Members of the Assembly some indication of the interim results of our researches. I did endeavour in my speech to give an outline of what I thought were the fundamental principles of taxation for Singapore and I have not so far heard them criticised. In fact, if I may say so, I think they can be regarded as unexceptional.

Similarly, the Labour Front Coalition Government has certain principles of taxation which were enunciated in their election programme. Circumstances forced us to abandon these principles temporarily, to put the cart before the horse of taxation; or to use another metaphor, change the batting order - not to throw anybody out of the team but merely to bring No. 3 up and put him as No. 1 because No. 1 happens to be temporarily indisposed. That is why I told you in some detail what had passed through our minds and in our deliberations before we were forced to introduce increases in indirect taxation, and before we were able to introduce those measures of direct taxation which we intend to do in the future. I do not think any harm has been done. People in Singapore, far more able perhaps than most of us here, can size up with a great deal of accuracy what measures of taxation any government can bring in at any given time. The mere fact that we have outlined a genuine policy of taxation will not have the effect of lowering confidence. It will have the effect of strengthening confidence in the Administration. As regards the proposals themselves, I do not think anybody can criticise them as being harsh or likely to bear hardly on any section of the community.

As regards the question of yield, I have gone into that with very great care, with the assistance of experts from the Customs Department who have been at this job all their lives. There will certainly be a slight contraction in consumption. That is inevitable, but it will be temporary. But I do confidently believe that the Estimates which I have given of yield will materialise in the course of 1956.

I would also like to say that gin was not forgotten. We considered the possibility of increasing the tax on gin. Gin of all liquors consumed in Singapore is still going steadily down as far as consumption is concerned. I felt that to impose a considerable increase of tax on gin would merely accelerate the downward trend of consumption. Again, as far as I am aware, gin is no real substitute for whisky or brandy or samsu -

Mr Lee Kuan Yew: There speaks the expert!

Mr Hart: Thank you! I doubt very much whether the increase of tax on these other liquors will cause a movement towards gin. In any case, the position will be kept under review and should there be any tendency in that direction, we will, of course, immediately take steps.

As regards champagne, I doubt very much whether the consumption of champagne is a material factor in the life or revenue of Singapore.

Still wines: It was suggested that we had had to reduce this duty some time in the past because consumption was going down. That is perfectly true. Consumption did go down slightly but I think that was due to economic causes rather than consumption causes. In any case, during the last two or three years, consumption has mounted very considerably, and now there is a definite market for still wines of under 26 per cent of alcohol and I think that we were on perfectly sound and safe grounds in restoring the tax.

As regards estate duty, we did consider all the facts you have mentioned and we are still convinced that from the short-term point of view no harm will come from increasing estate duty in the way we have done and we hope that the Federation will be able to see their way sometime in the future to join hands with us in this respect.

Now these are my comments on the Estimates. Finally, I do not think we are myopic, hesitant or that I am a Scottish butterfly wearing hobnailed boots. I am quite impenitent about it. I think these are good Estimates. They are not colonial estimates. They are the Estimates of this Government, reached after consultation on a basis of Ministerial responsibility. As regards form, I can think of no better form than the form in which they are drawn up. From time to time I have made a study of the way the Estimates are drawn up in other countries, and I think I can safely say that the Estimates here are drawn up in even greater detail than in any other country that I can name; and indeed, as far as the questions which my friend the Member for Tanjong Pagar raised, if he would only pause to think of it, he would appreciate and understand what the various sub-heads mean, or if he could not find a solution after a little cogitation, he had only to come to my office and say, "Look here, can you tell me what this is all about?", and he would be informed.

Now, Sir, I am sorry to have taken up so much time and I formally move that the Bill be read a Second time.

Question put.

Mr R. Jumabhoy: I claim a division, Sir.

Mr Speaker: Clear the lobbies.

The House divided: Ayes, 19; Noes, 13; Abstentions, nil. Ayes Noes Abdul Hamid Bin Haji Ahmad Bin Ibrahim. Jumat. Ede, John. Braga, A. J. Goh Chew Chua. Butterfield, C. H. Goh Tong Liang. Chew Swee Kee. Jumabhoy, R. Hart, T. M. Lazarous, A. R. Higham, J. D. Lee Choon Eng. Jumabhoy, J. M. Lee Kuan Yew. Lim, R. C. H. Lim Cher Kheng. Lim Yew Hock. Lim Ching Siong Mak Pak Shee. Lim Choon Mong. Marshall, D. S. Lim Koon Teck. Mohd. Sidik Bin Tan, William. Haji Abdul Hamid. Nair, M. P. D. Ong Piah Teng. Seah Peng Chuan. Sutherland, G. A. P. Abstentions Tan Theng Chiang. Nil Thomas, Francis. Wong Foo Nam.

Bill accordingly read a Second time.

Mr Speaker: Committee of Supply, what day?

Mr Hart: Wednesday and the two following days, Sir.

Mr Speaker: Until?

Mr Hart: Friday, Sir. I hope the business will be finished by Friday, Sir.

Mr Speaker: But what are the days allotted, Mr Financial Secretary? Is it from Tuesday to Saturday inclusive?

Mr Hart: Yes, Sir.

Mr Speaker: In accordance with Standing Order 69 (4), I have allotted the time to be given for each head of expenditure in the Schedules to the Bill and for the clauses of the Bill. These will be circularised and will also appear in the Official Report. In allotting the time I have, of course, taken into consideration the indications given to me by Members at the conference of the 18th of November and the notices of amendments received since that conference. In respect of heads on which I have had no indication that Members wish to speak, either on amendments or to the main Question, I have only been able to allot three minutes to each head, which as nearly as possible is all the time available after allowing for the times given for other heads.

SCHEDULE (Cols 1071-1076)