MALAYANISATION AND EX-GRATIA PAYMENTS TO CITY COUNCIL EMPLOYEES

Mr Lee Kuan Yew: Mr Speaker, Sir, I move the motion standing in my name. It reads:

That this House deplores the decision on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments made by the present City Council during its last few days of office and urges that sanction, as required by paragraph (r) of section 29 of the Municipal Ordinance, to the payment of over one and a quarter million dollars for ex-gratia payment mostly to expatriate employees, be withheld until the new City Council to be elected on the 21st December has reconsidered the matter.

There is a typographical error in the Order Paper, Sir. The last part of my motion should read ". . . has reconsidered" the matter, and not, as printed, ". . . has recommended".

Sir, as the days go by, we approach Christmas time, and we all receive beautiful Christmas cards sent by fellow Assemblymen to one another. I hate to spoil other people's Christmases, but whilst I would like to convey my good wishes for a happy and merry Christmas, I cannot be urged to join in felicitations to the extent of letting pass unnoticed $1¼ million worth of public funds, most of which will go to expatriate officers already in retirement in the United Kingdom.

Sir, there are two possible approaches to the subject that I have tabled for debate today, one on principle and the other on detail. Whether it is to be on principle alone or on detail and principle, I leave it to the Members on both sides of the House other than those of my Party. I propose to take the question of principle first. If Members, particularly those who are Members of the City Council up till midnight, choose to raise this matter in detail, I may inform them that I have been fairly well briefed by local senior officers in the City Council and I am quite prepared to go into the matter in detail.

Briefly, the one question of principle that I object to strenuously is this: that at the second last meeting on the 29th November, when almost every City Councillor knew whether or not he was going to put his record of office before the electorate, and had decided that he was not going to do so, he joined expatriate officers - the President of the City Council and his colleagues - in bundling these two Christmas gifts by.

Now, Sir, we all know that elections to the City Council should have been held in 1955. The P.A.P. supported the ex-Chief Minister when he moved a resolution that elections should be postponed so that the whole question of the local government structure could be reviewed. These people were therefore allowed to carry on, and they have carried on for over two years. Their mandate had expired. They had no right to decide on major issues such as this one costing millions of dollars - $1¼ in the case of the additional benefits of provident fund, and $14 million (in our calculation) on the other issue of Malayanisation.

These were the two big issues on which there was a lot of hard argy-bargy for a long time but no decision was arrived at. No vote was taken until the Councillors knew that they were not contesting elections, either because their Parties thought they were too heavy a political liability, or for other personal reasons. The moment they decided that their future was not for the public to decide any more, since they did not think their past record worth putting before the public for its decision, they passed these two big things, and we strenuously object.

We object in particular to the expatriate officers in the Council being not just a party to this, but being the prime movers of this. They knew that the next Council is going to be radically different from the present one. This is a nice, cosy little set up. We have nine nominated members, we have 18 elected on the old basis - small little elections, 800 people were involved; and nice little people like - well, I will not say nice little people but little people like the hon. Member for Queenstown; I mean it depends on whether one likes him or not, but they are people whom you can accommodate, you could persuade, you could talk them round - reasonable chaps.

The next City Council is going to be quite a different proposition. These officers know it and so do the Councillors. And these officers know further that it is very unlikely that they will get such an amenable council as the present one. They are going to get people who will be very sensitive to what the public thinks and who have very decided views about how public funds should be dispensed. Therefore, rather than risk the matter receiving more careful consideration, and a final decision by the real representatives who will be elected on 21st December - tomorrow - they smuggled it through on 29th November.

Now, Sir, I have worded the motion carefully because I do not want to apply it to each and every case of those who retired before the operative date. I think it was 1954 (I believe you are quite familiar with the matter) - when salaries were boosted up after the war and provident fund schemes were not similarly adjusted. The consequence was that those who retired before that date when the provident fund scheme was adjusted to fit in with the new emoluments, suffered in not getting the benefits of the new rates. There may have been a few individual cases where, quite properly, a case can be made out under section 29 (r) of the Municipal Ordinance. This section stipulates that the Governor in Council - but perhaps I should read the exact words:

"The Commissioners are authorized to expend the Municipal Fund for the following purposes: - . . . (r) payment with the previous sanction of the Governor in Council in special cases of gratuities to deserving municipal officers or workmen prior to, on, or after their retirement or to their widows or children on their death".

Now, Sir, people like Mr A. P. Rajah of the Liberal-Socialist Party, who gave away $50,000 to the City Council engineer (I think it was the Chief Engineer), and another, Mr Chan Kum Chee, who voted another large sum of money to some electrical expert for stopping the power failures, quite wisely did not offer themselves for elections. But here they have the impudence, these Councillors as a whole have the impudence, not to consider, according to section 29 (r) , each individual officer's case to see whether or not any injustice was made or had been inflicted in a particular case, but to make a blanket payment of $1¼ million. If they want to give away their own money it is their funeral, but this happens to be our money and it is our business. We in this Chamber have a right to urge the Government not to give this sanction, as the City Council is required under the Municipal Ordinance to get sanction from the Executive Council.

Now, Sir, that is a nice legal point. This Ordinance will expire by tomorrow, and the question is: Can the Government under the new Ordinance give sanction, because the new Ordinance does not contain a similar proviso? In my opinion, there is not the slightest doubt whatsoever that if this is not done before the 21st December - before midnight tonight - then it cannot be done at all. But if my view happens to be wrong and another view is established that the sanction can be given even after the Ordinance is repealed, then I say very seriously to the Government that it would be an act of political folly to be a party to this rump of local political has-beens, and give away this amount of public money.

I have been careful, Sir, in my drafting of the motion not to say that this is wrong in each and every case. There may have been some special cases where an injustice might have been done, but a blanket provision, if approved, would be a betrayal of the mandate of the people to us to look after public funds.

Now, Sir, I shall leave the personalities involved, who voted through this $1¼ million, to the Liberal-Socialist Party because it issued a statement immediately after we brought public attention to bear on this matter. It washed its hands completely clean of this. It said, 'Oh, no, we are against the whole business.' In fact, but for the Member for Cairnhill who, for some reason or other, abstained on the whole matter and thereby connived at it, the Liberal-Socialists were dead set against it. They did not approve of this waste of public funds and doubtless it will be their duty to clarify their position.

Now the more important issue, that of Malayanisation; this is a more complex subject and a larger sum of money is involved. Quite a number of minds have been at work on this topic for a long time. They have worked out a very nice and very complicated scheme whereby all City Council expatriate employees who are at present on contracts can opt to sign new contracts - type A, type B and type C. In short, it means money all round because there is no reason why any contract should be renewed. They are not Malayan Civil Service officers, the heaven-born who were in a special category. We were persuaded last year because the Government of the Federation approved the abolition terms in the Federation, not to attack the Government on the abolition terms offered to expatriate officers here. But of course that has acted as a great stimulus to expatriate officers in the Singapore Harbour Board, the City Council and all other semi-government corporations, to try to get similar or equivalent abolition terms. Everyone thought that this was a jackpot free-for-all - just put your hand into the kitty, grab a bagful of notes, put them into your pocket and push off. Better still, get another job in the Telephone Board where, subsequently, you might be able to persuade some stupid members on that Board to agree to give you further abolition terms.

I think I should go into this in much detail and read to this House a letter which has reduced this complicated plot into fairly simple terms. This is a letter written by the President of the Local Senior Officers Association of the City Council of Singapore, an open letter published in the Press. It says:

"The Singapore City Council at its meeting on November 29th agreed to offer expatriate officers the option of continuing on the permanent establishment on their existing terms and conditions of service, or as varied by agreements from time to time, or entering into one of the following three forms of contracts of service with the Council on the terms and conditions set out hereunder and referred to as contracts A, B and C."

As this is a fairly complicated matter to the uninitiated. I will read a little slowly:

"Contract A is to incorporate all the conditions of service applicable to all senior officers at present and, in addition, to provide that an officer who resigns after five years is to be paid a lump sum of the difference between the more favourable and the less favourable method of compilation for provident fund."-

There are two methods of calculating provident fund, one the more favourable, one the less favourable; the difference is about 30 to 40 per cent. Sir, if an officer signs contract A, stays on for five years and resigns, and if he himself quits - he gets this extra 30 or 40 per cent, for no rhyme or reason whatsoever, because in any case he is on contract. If he does not like it, and has a better job, he goes, as some officers who have better jobs have gone. To continue:

"If his service is terminated by the Council"-

and this is the other proviso, this is the other side of this plot-

"for any or no reason other than misconduct or ill-health"- in other words, you cannot sack a man other than for misconduct or ill-health; if he is downright inefficient you have to tolerate him. It is all laid down, you can only sack him for misconduct or ill-health-

"and he be thereby compulsorily retired"-

in other words, malayanised-

"the compensation payable is to be calculated on the following basis:

(1) The difference as in the first paragraph above [that is, table A and table B of the provident fund]; and

(2) Government abolition terms."

That is the big thing. That is what everybody is grabbing. Expatriate officers will have written into their contracts that if any expatriate officer is malayanised, then compensation is payable to all such officers and provident fund benefits will also be paid in addition. So all the officers who now have contracts - a hundred odd persons - sign new contracts. They all sign contract A, and then if they serve five years and they do not like it any more, they take this extra provident fund with no abolition terms. If they happen to stay healthy as they are bound to on their present salary, and they do not commit an indiscretion, then you cannot get rid of them. If you do get rid of them, then they get greater benefits of provident fund. This will no doubt serve their five years for abolition terms on Government rates. Furthermore, if you sack one, then all the other officers who have signed contract A, can also say, "Well, I am leaving too. Please give me extra provident fund benefits plus abolition terms."

Now, contract B provides for an officer who resigns:

"to receive provident fund benefits according to Table B of the Provident Fund Rules,"

That is the less favourable one.

"and to sign a contract which is similar to contract A except in lieu of further provident fund benefits. He receives an allowance equal to 20 per cent of basic salary."

That is not the important one, because I do not think many will plump for that one.

Contract C provides for an officer who resigns:

"to receive provident fund benefits according to Table B of the Provident Fund Rules and to sign a short-term contract for three years' resident service on the same lines as the present contracts for temporary officers. It has been agreed that gratuities, compensation of provident fund payments be made tax free."

In other words, the Council pays the tax, and they collect. Now, we worked out the abolition terms and all these people who come in will collect $50,000 or $60,000 and that is tax free. They are not in that same privileged position because under the law of income tax, they have to pay a large slice of it in income tax. So they providently provide beforehand that on the sum they are going to receive, the Council will pay the income tax and they collect as much as they would have had if they were in Government service.

Now, Sir, this is what the local officers have to say on this:

"The Council has apparently approbated its rights to terminate any expatriate officer's contract for inefficiency or redundancy without paying compensation. In times of recession, it would be less expensive for the Council to retrench local officers than expatriate officers. My Association, [this is the President's writing] after its representatives had given evidence before the Malayanisation Commission, have not pressed the Council to implement the terms of this Commission's Report as it has viewed with concern the enormous sums of money which have been paid to expatriate officers in Singapore and in the Federation Government services."

Those praiseworthy, public-spirited servants! In Singapore, it was stated that the direct cause of a deficit in 1957 - the deficit being $8 million - was that $9 million was paid out in abolition terms. Therefore the conclusion we draw is that but for that, there might not have been a deficit but a surplus of $1 million. This is according to the computation of the Hon. the Financial Secretary. I read on:

"In the opinion of the members of my Association, these large sums of money could have been better spent in enlarging the local services which could have directly benefited the peoples of Malaya. The members of my Association feel further that whilst they hold the view that all the senior posts in the City Council can be fully malayanised with a few exceptions within four years, they should not press for immediate Malayanisation if vast sums of money are to be handed out to all the Council's expatriate officers. This money could be better spent on projects that benefit the people of Singapore."

These are the facts briefly and succinctly stated. I am quite prepared to go into further details on this but I would like to take the matter on principle.

Mr Speaker: Order. I think the hon. Member did anticipate the Chair when he said that he would not go into the details but would debate the principle because, as I read the motion. it says,

That this House deplores the decisions on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments made by the present City Council during its last few days of office and urges ..." etc.

Of course, the hon. Member can touch on details to indicate that it is, in fact, a major issue but I would not allow a debate on the issue itself.

Mr Lee Kuan Yew: I am much obliged to you, Mr Speaker, Sir, but I merely indicated that in order to inform all Members in this House that we are fairly well briefed on the subject. I am quite prepared to answer any questions from our point of view regarding the subject matter which we have tabled for debate.

Sir, everybody knows that over 520,000 voters are going to the polls tomorrow to elect 32 new City Councillors. Everybody knows that the Liberal-Socialist Party have had the impudence to put up 32 candidates many of whom are likely never again to contest elections, and also that the Liberal-Socialist Party were very anxious to wash their hands of this matter the moment we brought the spotlight to bear on it. Sir, when they shelved off the extra payment of provident fund, they were silent on the question of Malayanisation. It is necessary to remind them that they were the prime movers. Their Mr A. P. Rajah who was their leading man in the Finance and General Purposes Committee was responsible for this whole scheme. A long time was taken to work this out. In his last statement, which the national dailies were judicious enough not to publish, because it probably did him more harm than good, but which the not so judicious daily Free Press did publish - Mr A. P. Rajah said that the reason why he did all this, of course, was that he did not want to see the people being victimised. He is a presumptuous man. If he does not want to see anybody being victimised and he thinks that he is the man to do justice, then he should have come out to fight the elections. He should speak his Party's policy and explain to the people why he did so and so. Instead he has decided to retire from politics for the time being, and not to try and justify what has been done. What we would like to tell him and his colleagues is this. We are here to see that the people of Singapore are not victimised, and not to see that a few persons in the City Council are not victimised. Nobody is threatening to victimise them provided they do their duties. We do not want to cut off our noses to spite ourselves but if we feel that somebody is trying to pull a fast one over us, we will cut off their noses to spite themselves, even if we suffer the consequence.

Now, Sir, in asking this House to approve this motion, all I am doing is to say that the matter should be reconsidered by the new Council. It may well be that the first new candidates of the Liberal-Socialist Party will duly assemble on Monday the 23rd to elect their Mayor. They will not be electing one who has been trained to be a Mayor because the one who has been so trained is not contesting the elections, but if that eventuality should arise, then so be it. But the suspicion one has is this: the President of the City Council does not believe that they are going to come in. In fact everybody who knows what is going on knows that they are not coming in and knows that these resolutions would never receive the same favoured treatment if the question were to be opened again. It may well be that on the question of the provident fund, certain individual cases may have to be taken on their merits and justice meted out. We do not want to be unjust. It may well be that the new City Council may be even more stable, more in a position to offer long-term prospects of employment and to keep its promise. But we do not want something to be bundled through so that we who come into the Council on the 21st (tomorrow) and meet on the 23rd December for the first time are prevented from doing anything about these major issues because they are already fait accompli. That is the principle that I am asking this House to join me in supporting.

Mr Goh Chew Chua: I rise to second the motion and reserve my right to speak.

Mr Speaker: The hon. Member for Tanjong Pagar did point out what he called a typographical error. He has asked that the word "recommended" be read "reconsidered". The typographical error was of course his own.

Mr Lee Kuan Yew: I fully acknowledge that.

Question proposed.

4.25 p.m.

Inche Abdul Hamid: Mr Speaker, Sir, the motion before this House is in two parts. The first reads:

"That this House deplores the decisions on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments made by the present City Council during its last few days of office."

And the second part reads:

"and urges that sanction, as required by paragraph (r) of section 29 of the Municipal Ordinance, to the payment of over one and a quarter million dollars for ex-gratia payment mostly to expatriate employees, be withheld until the new City Council to be elected on the 21st December has reconsidered the matter."

The first part, Sir, is concerned with a point of principle, namely that the City Council has made decisions on important matters within a few weeks of the expiry of its tenure of office.

Mr Lee Kuan Yew: A few days, not a few weeks - 29th to 31st.

Inche Abdul Hamid: It is still a couple of weeks. It is necessary, Sir, for the purpose of debate to take the two decisions separately before coming to any conclusion about the point of principle. Firstly, Malayanisation. It is I think implied in the motion and in the speech of the Member for Tanjong Pagar that this is a hurried decision made at the last moment and that -

Mr Lee Kuan Yew: On a point of clarification, Sir.

Mr Speaker: If the Minister will give way.

Inche Abdul Hamid resumed his seat.

Mr Lee Kuan Yew: I do not suggest for one moment that this was a hurried decision. I suggest that there has been a long time hatching this plot and that it has been smuggled through just before the cockerels came in.

Inche Abdul Hamid: I still think my interpretation of his speech is that he meant that it was a hurried decision. I must point out, Sir, that it is not true that the decision was a hurried one. Government is aware that it has been the result of very detailed study by various committees of the City Council. It is a problem which the City Council has lived with for a long time although I myself can say that it was rather unfortunate that they could not arrive at a decision, say, a few months before the elections.

Concerning the decision to make ex-gratia payments amounting to about one and a quarter of a million dollars, once again I know that this is not a matter which has been decided swiftly or hurriedly. It has a long history and it has been the subject of much discussion and study by various committees. I am informed that it originally arose from a petition by ex-local employees of the City Council giving grounds of hardship owing to the reduced postwar purchasing value of the dollar. I have endeavoured to point out that these two decisions were not arrived at in a hurry and that being the case, Government therefore, Sir, cannot subscribe to the terms of the first part of the motion. The terms of the second part of the motion are quite clear. It urges upon the Government that sanction be withheld under paragraph (r) of section 29 of the Municipal Ordinance in respect of an ex-gratia payment of about $1¼ million. In regard to this matter, the City Council has made application to the Governor in Council and this application is at present under consideration and I cannot at this stage, Sir, commit the Governor in Council for their views. Government, Sir, does not have to urge itself to do something. We either do it or we do not. If the Opposition thinks that any urging is necessary, it is free to do so but I can assure the Opposition that Government will take due note of their views.

4.29 p.m.

Mr Lee Choon Eng: Mr Speaker, Sir, I had no intention of speaking on this motion when it was tabled. As there is exactly 7½ hours more for me to remain a City Councillor, I do not think that it is right for me to speak on the motion, but after having heard the attack of the Member for Tanjong Pagar that all City Councillors joined in with the President and senior officers to approve what is contained in the motion before the House -

Mr Lee Kuan Yew: On a point of clarification.

Mr Speaker: If the Member will give way.

Mr Lee Choon Eng resumed his seat.

Mr Lee Kuan Yew: Sir, just in case the Member for Queenstown says a few brash remarks that he may have reason to regret subsequently, I would like to say that not all of them joined in this plot. If they had all joined in this plot, the thing would have been smuggled through with such deadly silence that nobody would have heard about it. It is because a few birds did make a lot of noise; they squawked away and so it reached half round the world and finally arrived in this Chamber.

Mr Speaker: Order. I think the hon. Member seems to be making another speech. He could probably have said that in reply and I think he has clarified the matter sufficiently. I think the point that excited the Member for Tanjong Pagar to ask for leave to intervene was that the Member for Queenstown thought that he was involved in this so-called plot and I think the Member for Tanjong Pagar has said 'No'. I think that clarifies the matter.

Mr Lee Kuan Yew: Sir, I would like to be quite explicit on this matter. On the question of Malayanisation, I would like to say that he was not involved at all. He voted against it, to his everlasting credit.

Mr Lee Choon Eng: I am much obliged to the hon. Member for clarifying the situation. I thank the Member for Tanjong Pagar for making it clear that I was not actually involved in one of the issues. That is why I stood up to speak.

Now the thing is this. The manner in which he has tabled this motion shows that he is not quite fully aware of the internal affairs that went on in the City Council. The Minister for Local Government, Lands and Housing said that the motion appeared to him to be in two parts and as it now appears to me that it is in fact two parts which is framed in one motion, I am at a loss to understand what the actual motion is. Really I cannot understand where or what the Member for Tanjong Pagar is arriving at, whether it is Malayanisation or the provident fund. According to the extracts he read from some information he got, I am led to believe that it is more on Malayanisation than on the second part of his motion. The first part of his motion reads:

". . . decisions on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments...".

Now, these one and a quarter million dollars ex-gratia payments have got no connection with Malayanisation at all. And the second part is clear, as the Minister for Local Government, Lands and Housing pointed out just now. It reads:

"...the payment of over one and a quarter million dollars for ex-gratia payment mostly to expatriate employees...".

Now, Sir, there were actually two issues in the City Council: one, Malayanisation and the other, provident fund for those who retire after certain dates. So now if you mix both issues together, I am afraid that some Members of this Assembly will get themselves confused and will not be able to cast their votes in the proper way. The hon. Member (Mr Lee Kuan Yew) knows who has voted and who has not voted on this question in the City Council. Much as I would like to explain and go into detail of the actual facts of the two issues - Malayanisation and provident fund - I think I would prefer to keep him guessing. I would like to quote the Hon. the Chief Minister's words, "A little knowledge is more dangerous than to have no knowledge at all." Since the Member for Tanjong Pagar has only a little knowledge, it is rather dangerous for me to tell him more and so I prefer to refrain from doing so.

4.34 p.m.

Mr Lim Choon Mong: Mr Speaker, the issue seems to be:

"That this House deplores the decisions on major issues...",

and Malayanisation and ex-gratia payments are taken as examples. I wonder why the Member for Tanjong Pagar has not brought up other major issues. I know that today is the eve of the City Council elections. It is the intention of the hon. Member that the Liberal-Socialists should not receive all the credit and that we do not get all the votes tomorrow. Such an attitude should actually be discouraged. For no better propaganda material, he has accused the Liberal-Socialist Party of one thing or another and later on he swallowed it all back to say, "No, they are not involved. They have cleared themselves." I just cannot understand how the leader of a political Party can just tell all these half-truths to the people of Singapore and get away with it and then come to this Assembly to tell us, "Well, they have cleared themselves. We are now on this issue and we are now on the other issue." I think that this is not absolutely honest.

Mr Speaker: Order. I think the Member for Serangoon should try and contain himself. The expression "not absolutely honest" with reference to a Member of the Assembly is unparliamentary.

Mr Lim Choon Mong: Perhaps, Sir, I -

Mr Speaker: Will the hon. Member withdraw the expression?

Mr Lim Choon Mong: I withdraw it. It may not be, Sir, that the Member for Tanjong Pagar is the only leader of the P.A.P. There are also other leaders not in this Assembly who spoke the same untruth and I suppose I shall not be pulled up for applying such remarks to such people.

On the second part of the motion on the ex-gratia payment, I shall repeat what has been said. There was a committee consisting of the following City Councillors none of whom are from our Party. They are Mr Sim Beng Seng, Mr Seet Leong Seng, Mr Theo Leijssius, Mr L. Rayner and Mrs G.C. Smith. They recommended that an ex-gratia payment amounting to $1,267,000 odd be paid to the retired officers concerned. Of course, the matter went before the Finance Committee and for various reasons it was voted against. Finally, it was brought up before an ordinary meeting of the City Council and the motion for this payment was approved, but not with the votes of the Liberal-Socialists. All of them voted against the issue with the exception of one who abstained. Sir, on this matter, I believe that the Member for Tanjong Pagar has said that the Liberal-Socialist members have done this and that but finally he said that we were not involved. I would say that he should withdraw all those things he said. If he wants to quarrel with the Labour Front Members, he can go ahead and quarrel with them. We have no issue with them on this matter.

On the question of Malayanisation, Sir, I think that it was the idea of the Member for Tanjong Pagar to get rid of all expatriate officers from Government service and he advocated buying them out, I think, when the question of compensation for the Malayanisation of the civil service came up. He said, "We can recover all the money from our savings and it would be cheaper buying them out."

Mr Lee Kuan Yew: On a point of information, Sir. Would the hon. Member quote me -

Mr Speaker: Order. Only if the Member will give way.

Mr Lim Choon Mong: Even during this Budget debate, Sir, when he discovered that the interest from this money would not be sufficient to pay for the cost of Malayanisation, he advocated, "We will put up posters outside the banks and say, 'We seize them in the name of the people to pay for expatriation fees and all that.' " Well that confirms it. If he had not made that previous suggestion, Sir, then he would not have regretted making this other suggestion in this Assembly. If the Government is spending $21.4 million on Malayanisation, the City Council is following suit in trying to get rid of their expatriates and on that score, Sir, unless the Member for Tanjong Pagar can come up with a better suggestion as to how to get rid of them -

Mr Speaker: Order. I think the Member for Serangoon is going dangerously into a debate on the issue itself. I am trying to prevent that. The issue before the House is merely,

"That this House deplores the decisions on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments made by the present City Council during its last few days of office...".

That is all.

Mr Lim Choon Mong: The Minister for Local Government, Lands and Housing said that the City Council sat through the problem for quite a long time and they came to that decision but I was saying that if somebody else has no better ideas on how to go about it, then it should be -

Mr Lee Kuan Yew: It will be done after the 21st.

Mr Speaker: Order.

Mr Lim Choon Mong: - done this way. So far, Sir, I have heard no concrete suggestion as to how the thing could best be done. This motion is on two issues tied up together as one and it would be better to deal with them as two separate issues instead of one that is bundled up to be smuggled through this Assembly.

4.43 p.m.

Mr Goh Chew Chua: Mr Speaker, Sir, I do not understand complicated matters of political plotting. To me the issue is quite simple. The approval of these two resolutions would cost the public millions of dollars. I am sure, if the European officers in the City Council expected the next City Council to be the same as the present one, they would not bother to rush these two resolutions through. The President of the City Council, Sir, knows that the term of office of his collaborators is going to expire at midnight tonight, and I know that they will never be elected again to the City Council. Sir, I object to this kind of plotting. If a thing is right, surely the next City Council will have the right to approve it. Sir, we have more than a suspicion that the thing is wrong. So do the people of Singapore. It is important, Sir, that the people's representatives in the next City Council should decide what is right or what is wrong in the future, not the European officers, nominated Members and political wash-outs.

4.45 p.m.

Mr Lim Koon Teck: Sir, when I received notice of this motion, I read it through three times and I could not make out what it was. To me, it was a great surprise that a very learned and precise mind could have drawn up such a motion to be placed before this House. The more I thought about it and the deeper I went into it, the more I was convinced that it was an attempt to confuse the issue and to involve our Party which has stood honourably and correctly on the ex-gratia payment issue.

Mr Lee Kuan Yew: Hear, hear! Then vote for it!

Mr Lim Koon Teck: I am glad that today the hon. Member for Tanjong Pagar at least has the decency to admit that he was wrong when he imputed all sorts of things against us for wanting to give away millions of dollars. Sir, we are not concerned at all with the ex-gratia payment issue and we stick to the stand taken by our representatives on the City Council and we say they were correct.

On the point of Malayanisation, Sir, we have to ask: Who has brought about this difficult position in which our country finds itself? We are in a position where we do not have enough technical people to run our City Council services, and we may be faced with the possibility of so many of these people wanting to leave this country at the very moment when we require them, because our local men who are in training overseas and in Singapore are not quite ready to take over. Rather than make a mess, surely responsible persons must look for a way to bridge the gap so that we can still have the services of people who are running the very important and essential public services of Singapore until such time as our own people can take over. That is exactly, Sir, what our City Councillors have done. They have gone very carefully into the problem without bias and have tried to take the proper attitude towards two sets of people with conflicting claims, and in their honesty they have placed before Government a scheme, and it is now for the Governor in Council to make a decision. Sir, I think our position is clear. We have not done anything wrong and our Party is proud that it is fielding 32 candidates in the field for tomorrow's elections. The hon. Member for Tanjong Pagar asked us what impudence made us put in 32 candidates. I ask him, "What impudence made the hon. Member put in 16 candidates?"

Hon. Members: 14.

Mr Speaker: To be in order I think the hon. Member should say "What impudence made the Party put in. . .", not "the hon. Member".

Mr Lim Koon Teck: I stand corrected.

4.50 p.m.

The Chief Minister: Mr Speaker, Sir, you have clearly ruled that the debate on this motion is on the question of principle and that details should be avoided as far as possible. Therefore, it is not for us on this side to stand up and try to defend or condemn the decisions of a lawfully constituted body which has come to a decision of very grave character, particularly as the Council itself is very concerned with the staffing problem of the basic services. My colleague the Minister for Local Government, Lands and Housing has said that the Government is aware that there has been no rush in the consideration of this very important problem. I have personally been interested in this particular problem and have had discussions of an unofficial nature with members of the City Council, and I can say in all honesty that this matter has not been rushed nor smuggled through.

With regard to the decision to make an ex-gratia payment of $1¼ million to ex-employees of the City Council, local and overseas, the Minister has said that an application has been made to the Governor in Council, and this application is still under consideration.

Sir, as to the first part of the motion, we have made it clear that we cannot be a party to deploring something which we know is not right. To the second part, we say that we cannot prevent the Opposition from urging the Government to do what it thinks the Government should do.

4.52 p.m.

Mr Lee Kuan Yew rose -

Mr Speaker: Mr Lee Kuan Yew, in reply?

Mr Lee Kuan Yew: It is very strange, Mr Speaker, Sir, that every time we have a live political matter for discussion, very few Members are prepared to express their opinions upon it.

Sir, first, I would like to correct a misconception in the minds of both the Member for Serangoon and the Member for Paya Lebar. I would like to read them the P.A.P. statement on this matter, and they will see that right from the word go we had our facts correct. We condemn the City Councillors on Malayanisation and we condemn the whole lot of them, not just the Lib-Soc element, on the ex-gratia payment issue. I have the statement here but I will just read the relevant parts to assure the two Members that they have not been misrepresented. In fact, the case has been presented with great vividness over a series of mass meetings and the people of Singapore are quite aware of the position. What we said is this:

"The P.A.P. condemns the decisions taken by the present City Councillors in their last few days of office on important issues like Malayanisation of the City Council and ex-gratia payment of a million and a quarter dollars, mostly to retired expatriate officers. They have no right to tie the hands of the new Councillors to be elected on 21st December. The P.A.P. does not consider itself bound by the decisions of these Councillors who are so ashamed of their record of office that they dare not stand for election."

Two of them are very brazen types. They have presented themselves for re-election and we shall know their fate tomorrow.

"If the President and Councillors of the City Council try to rush and finalise the legal formalities before 21st December and so deny the people of Singapore, through their newly-elected Councillors, the right to say what they think about spending millions of dollars of the people's money, we, the P.A.P., will take appropriate steps to rescind the decisions and reopen these matters. It is scandalous that this rump of local political has beens, led by Liberal-Socialist A. P. Rajah, should decide in the last few days of office that to malayanise the City Council in the future the people of Singapore must pay over $14 million for compensation to expatriates and it is the same rump that has decided to give away itself. We blame them for the Malayanisation. We blame the whole Council for the $l¼ million."

Sir, I want to make our position quite clear. A lot of issues may develop out of the stand that we have taken today. My motion has been drafted with a certain amount of care. The Member for Queenstown wrote me a chit just now saying, "Why did you not break up the motion into two, and then I would vote for one?" It is clear that on the Malayanisation issue he would like to vote for it. The others are clear on the ex-gratia payment, except for the Member for Cairnhill who has very conveniently disappeared in case we call a division, and therefore they would like to have the two issues taken separately. "I am really not so bad, you know. I did right in one even if I did not do right in the other."

Sir, we are taking up this issue on the question of principle. We have never suggested that the City Councillors have suddenly hatched this plan and bundled it through. What we do suggest is that there has been careful plotting and hatching and they have decided that, as the incubator is likely to pass under new ownership on the 21st of December, they had better hatch the egg now or it will never be hatched. That is what we are saying - that they have no right to do that. Now we are urging the Government not to give sanction under section 29 (r) of the Municipal Ordinance, because they have to come to the Government for that sanction or the whole matter will be ultra vires and we will hold all of them responsible. We will surcharge them and make them bankrupt for paying out public funds.

As for the contracts themselves, I was delighted to hear the Member for Paya Lebar say that he is going to ask the Government about them. Sir, we are very preoccupied with the elections at the moment and our research bureau has not had the time to look up the legal implications of these contracts. But we will, after this election, if any step is taken about them. Whether or not sanction is required for payments other than what is already agreed between an individual officer and the Council, we say this: even if sanction is not required, if those contracts are signed before midnight tonight, or if they have already been signed, then this will become a live issue for the next Legislative Assembly elections. If they are validated, then we shall make this an issue in the next Assembly elections - that we shall pass a Bill in this Assembly to rescind and render null and void all those contracts. We say this knowing full well that tomorrow is Polling Day. That is the stand we have taken before the people.

I am glad to hear the Member for Paya Lebar speak the truth because Mr A. P. Rajah was what they call in Malay "lichin" - it is like a big marble ball; you cannot pick it up because it slips away from your fingers every time. First, they said, "Oh, it is utterly ridiculous. Of course, the new City Council can be malayanised. It is quite untrue to say that they cannot be malayanised." But today we have heard from the Member for Paya Lebar that the whole object of the operation is to put a ransom on Malayanisation. He says the local officers are not ready and cannot take over. These technical men are valuable - I do not say they are not, probably many of them are. Therefore we shall make sure that they are not got rid of by putting up this ransom. A contract is signed. The officer gets extra provident fund. He is sacked, and he gets abolition terms. In other words, they are all like the armadillo - they go on with this armour-plating. But we say quite clearly here and now that if this scheme is pushed through - maybe we cannot undo it in the City Council if it is all signed, sealed and delivered before the 21st December. But if it is done, we will wait until August or September next year when we will come back here, move a Bill to rescind that and say, "That was an act of indecency," and scrap it.

Sir, I would like to say this in conclusion before I call a division on this matter. First, I think they were just plain stupid to do what they have done, trying to bundle the thing through. Secondly, whatever merits there were in both the issues have now been tarnished and soiled by the suspicious manner in which the whole affair was handled. We are bound to approach this matter with a very considerable degree of suspicion, to see what this great haste was all about. There must have been something wrong or the whole matter would not have been bundled through. We say this: if the Liberal-Socialists are really against all this bundling through at the last moment, then they should vote for this motion. If they are not, then vote against it, knowing full well the consequences tomorrow. Mr Speaker, Sir, I beg to move.

The Chief Minister: On a point of information, Sir.

Mr Lee Kuan Yew: I shall be delighted.

Mr Speaker: Yes, If the hon. Member for Tanjong Pagar says he has not completed -

Mr Lee Kuan Yew: Oh, I am quite prepared to elucidate. I was just on the point of finishing and I will be prepared to elucidate, but I do not wish the Chief Minister to take this as an occasion to make a short speech.

The Chief Minister: Sir, I said on a point of information. I have not made it clear just now. I did say that on the first part we were against it, and on the second part we could not prevent the Opposition from urging us to do what they think we should do. As the hon. Member has said, he is going to call a division. As the Government has made no decision, it will abstain.

Question put.

Mr Lee Kuan Yew: Division, Sir.

The House divided: Ayes, 3; Noes, 1: Abstentions, 18; Paired, 2. Ayes. Abstentions. Ahmad bin Ibrahim. Abdul Hamid bin Goh Chew Chua. Haji Jumat. Lee Kuan Yew. Braga, A.J. Chew Swee Kee. Hart, T.M. No. Jumabhoy, J.M. Lee Choon Eng. Ong Piah Teng. Lim Cher Kheng. Lim Choon Mong. Lim R. C. H. Absent. Lim Yew Hock. Ede, John. Mak Pak Shee. Goh Tong Liang. Mohd. Sidik bin Haji Jumabhoy, R. Abdul Hamid. Lazarous, A.R. Nair, M.P.D. Lim Ching Siong. Seah Peng Chuan. Soh Ghee Soon. Shanks, E.P. Sutherland, G.A.P. Stewart, S.T. Tan, William. Tan Theng Chiang Thomas, Francis. Paired. Lim Koon Teck. Wong Foo Nam.

Resolved,

That this House deplores the decisions on major issues like Malayanisation and one and a quarter million dollars ex-gratia payments made by the present City Council during its last few days of office and urges that sanction, as required by paragraph (r) of section 29 of the Municipal Ordinance, to the payment of over one and a quarter million dollars for ex-gratia payment mostly to expatriate employees, be withheld until the new City Council to be elected on the 21st December has reconsidered the matter.