PORT DUES BILL

2.55 p.m.

The Deputy Prime Minister (Dr Toh Chin Chye): Mr Speaker, Sir, I beg to introduce a Bill intituled "An Ordinance to impose Port Dues."

Bill read the First time.

Second Reading

Mr Speaker: Second Reading, what day?

Dr Toh Chin Chye: Now, Sir.

Mr Speaker: Please proceed.

Dr Toh Chin Chye: Mr Speaker, I lay upon the Table a Certificate of Urgency signed by the Yang di-Pertuan Negara in respect of the Port Dues Bill.

Certificate of Urgency handed in.

Mr Speaker: The Certificate is in order. Are typed copies of the Bill available for the use of Members?

Dr Toh Chin Chye: Yes.

Typed copies of the Bill handed in to the Clerk and distributed to hon. Members.

2.59 p.m.

Dr Toh Chin Chye: Mr Speaker, Sir, I have the recommendation of His Excellency the Yang di-Pertuan Negara to proceed with this Bill, and I move, "That the Bill be now read a Second time."

Apart from the charges made by the Singapore Harbour Board, the only charge levied on shipping for the varied services provided in our port has taken the form of Light Dues at very nominal rates. These Light Dues yield approximately $480,000 per annum. This sum of money is paid into a special fund called the Light Dues Fund and this Fund is used exclusively for the maintenance and improvement of harbour lights and navigational aids. The present cost of maintaining the port, of dredging and survey, outside the Singapore Harbour Board, is approximately $1,500,000 per year. This, sum makes no provision for development or improvement expenditure to the harbour. All these years the annually recurrent costs and cost of development projects have been met from General Revenue.

The Government is well aware of the need to nurture the port, to improve its facilities and maintain efficient administration so that the services provided are highly competitive, but with the present need to provide for the adequate overall development of a rapidly growing community, Government finds it necessary to provide that the port user also contributes towards the annually recurrent and development expenditure of the port. The dues to be collected under this Bill will be paid into general revenue until such time as a Port Authority is set up when the question of paying the dues to a fund administered by the Authority will be considered.

The principle on the levy of Port Dues incorporated in this Bill is that ships and harbour craft which derive earnings from calling or operating at Singapore or who occupy a berth within the port for a period in excess of 30 days, shall be the only ones which are called upon to make a contribution towards maintenance and development of the port. Ships which call at Singapore solely for the purpose of taking on board fuel, stores and water will not be required to pay Port Dues. These ships which derive no earnings from their call in Singapore do, however, already indirectly contribute to the economy of the State to an important extent.

Special protection for the ship repairing industry has been provided in the Bill. Vessels which discharge cargo or disembark passengers for the purpose of effecting repairs or who call here solely for the purpose of repairs shall not be required to pay Port Dues.

In order to encourage the local fishing industry, Singapore licensed fishing boats will be exempted also from payment of Port Dues under clause 9 sub-clause (2).

The original draft proposals for the scale and implementation of Port Dues were forwarded to the Shipowners and Harbour Craft Associations and their views on the subject have been very carefully considered. The Bill now being considered incorporates many of the suggestions of the interested parties.

The rate of 10 cents per net registered ton for ships working cargo or embarking and disembarking passengers is considered to be a fair charge and one which takes into consideration the fact that the port must keep its charges to a minimum to survive in a competitive market.

The rates for harbour craft as detailed in the Second Schedule to the Bill are directly tied to the earning capacity of the craft involved and are considered to be a very fair charge on the user as a small contribution towards the various services given in the way of dredging and maintenance of sea and river walls.

Sir, I beg to move.

Question proposed.

Mr A. P. Rajah (Farrer Park): Mr Speaker, Sir, the Deputy Prime Minister gave us the cost of maintenance of the port facilities as $1.5 million. He said that this Bill was introduced with a view to recouping that sum of expenditure. But he did not tell the House how much he expected to collect in the way of port dues under this Bill.

The Deputy Prime Minister has also told the House that the Government intends to collect port dues from ships, which stay in the harbour for more than 30 days. By that, I take it, Mr Speaker, Sir, that most of the foreign ships and ocean-bound liners will more or less escape the provisions of this Bill, and that most of the craft which will come within the ambit of the Bill - and, therefore, liable for the payment of dues - will be craft anchored and stationed in Singapore and plying between Singapore and the neighbouring countries. While not denying that some dues should be collected, I think Government should bear in mind that the port is one of the vital arteries of Singapore, and before any port dues are charged on vessels using Singapore, particularly local craft, Government should be satisfied that this does not mean putting a certain type of craft out of business, or enhancing the fees which such craft have to pay, which might have an effect not only on the lives of certain people who use the sea, but also on the cost of living.

Government is interested in creating a situation in Singapore, which will attract industry. Therefore, it is imperative that any taxation policy, or any policy such as this followed by Government should be one which will attract industry to Singapore. Whether the revenues of the Colony are in such a state that it is necessary -

Mr Speaker: The State.

Mr Rajah: I beg your pardon, Mr Speaker, Sir. Whether the revenues of the State are such that it is necessary to impose these port dues is another matter on which the Deputy Prime Minister has not seen fit to address the House. From the very efficient Budget, which the Hon. Minister for Finance presented some time ago, it appeared to me that no further taxation was necessary. I think he gave the House to understand that no further taxation would be necessary. But within a few months of his statement, here is another form of taxation, which it is sought to enforce.

Mr Speaker, Sir, those are some of the observations which I have to make on this Bill. Clause 7 says:

"All port dues collected under this Ordinance shall be paid into the Consolidated Fund."

We know, of course, that the Government is interested in creating a Port Authority with extended powers and an extended area of control. The Deputy Prime Minister did say that when the Port Authority was created, Government would, at the time of its creation, consider whether the monies collected under this Bill would not then become payable to the Port Authority. We do not know when this Port Authority will be created, or whether it will be created within the life of the Government or outside the life of the Government. Could the Deputy Prime Minister say whether the port dues which will be collected under this Bill would be maintained in a separate fund until such time as the Port Authority is created, and whether the monies would then be transferred to the Port Authority? Or whether it is the intention of the Government that these monies would become part of the general revenue of the State, and need not necessarily be used for the improvement of port facilities?

3.08 p.m.

Dr Toh Chin Chye: Sir, the Member for Farrer Park has made certain observations, and I would like to correct some of them.

First, may I inform the House that the imposition of port dues in Singapore is not a precedent? There are ports in other parts of the world, which are already charging such dues. For example, in London, river tonnage dues are payable at rates varying from 2 pence to 6 pence per ton. In Liverpool, the rates vary from 1 11/16th penny to 9 pence per ton, and these rates have recently been increased by a two-third per cent. In Southampton, the rates vary from 1½ pence to 2½ pence per ton, plus a 20 per cent surcharge. In New York and other U.S.A. ports, the rates vary from 2 cents per ton to 6 cents per ton. In Rotterdam, harbour dues are payable at varying rates which are calculated on gross tonnage in cubic metres and on the quantity of cargo discharged and loaded. In Antwerp, the dues charged vary from Belgium francs 5.25 to 2.50 per ton. In Manila, port dues are payable at the rate of 12.5 centavos per ton or 35 centavos per ton full load of cargo discharged or loaded at the ship's option.

Up to the present time, harbour craft have made no contribution to the cost of maintenance and the development of the port, although they derive their livelihood from it. At present a 100-ton lighter pays only an annual licence fee of $6.75. Such a craft will now be called upon, in addition, to pay a port due of $150 per annum. However, there is an analogy in that commercial lorries pay licensing fees, which vary from $132 to $560 per annum, depending on their size. So we can consider that the port dues charged for harbour craft are quite reasonable. Moreover, harbour craft do not pay a heavy-oil duty tax to the Customs Department, whereas diesel lorries pay from $450 to $1,975 per annum. Sampans and other little craft are called upon to pay only nominal charges. According to the Second Schedule of the Bill, they will be covered by Class I and Class II, and, according to their size, these sampans will be called upon to pay either $1.50 per ton or $2.50 per ton, depending on whether they are mechanically-propelled or not. The charges they will ultimately pay will vary from the minimum of $5 to perhaps $20 or so. But these are only annual payments.

The estimated revenue from port dues, based on tonnage figures related to the 1959 Light Dues Receipts, is as follows: revenue from ships paying at 10 cents' rate is $1,890,000, and revenue from harbour craft is $110,000, making a total of $2 million.

The total expenditure on the port for the years 1955 to 1959 is $3,958,343. The greater part of this sum has been devoted to dredging, about $3,764,665 having been spent on it.

Now to come to certain points which the Member for Farrer Park made a moment ago. Ocean-going vessels which call at Singapore to discharge passengers or cargo or to embark passengers or load cargo do not escape paying port dues. They are covered in the First Schedule, where paragraph (a) says:

"For every ship entering a port for the purpose of loading or discharging cargo or embarking or disembarking passengers, ten cents per ton, subject to a minimum payment of one dollar and a maximum stay of thirty days."

Now the second part of the Schedule covers those ships, which stay in the port for longer than 30 days. The second part of the Schedule reads:

"(b) For every ship occupying an anchorage or berth within a port -

(i) for the first period of thirty days - no payment;"

having already paid once. If they stay for a period exceeding 30 days they have to pay:

"(ii) thereafter at the rate of ten cents per ton per thirty days.".

I may add, Mr Speaker, that the Minister for Finance in his Budget speech did give due warning to the House that the Government had the intention of imposing port dues. I would also like to add, as I have said just now, that up to date all expenditure spent on the port has come out of the Consolidated Fund, it is natural, therefore, that until the Port Authority is established, whatever dues we collect should justly and rightly go back to the Consolidated Fund. When the Port Authority is established, which we hope will be within the lifetime of this Government, a separate fund will be created, and the port dues so collected will be paid into this fund.

Question put, and agreed to.

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

Assembly immediately resolved itself into a Committee on the Bill.-[Dr Toh Chin Chye].

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