THIRD SUPPLEMENTARY ESTIMATES OF EXPENDITURE FOR 1961

Order read for consideration in Committee of Supply [1st Allotted Day].

[Mr SPEAKER in the Chair]

3.01 p.m.

The Chairman: Third Supplementary Estimates of Expenditure for 1961 (Paper Cmd. 29 of 1961). Will the Minister signify the recommendation of the Yang di-Pertuan Negara before the Committee proceeds with the consideration of these Supplementary Estimates?

The Minister for Finance (Dr Goh Keng Swee): I so signify.

The Chairman: The summary is in the last page. Head 42, Official Assignee and Public Trustee. There is an amendment standing in the name of the Member for Anson.

Mr David Marshall: Mr Speaker, Sir, I beg to move,

That the sum to be allocated for Head 42 be reduced by $10 in respect of subhead 1.

Mr Speaker. Sir, you will notice that these Supplementary Estimates are required to meet the increases under Personal Emoluments as a result of partial restoration of variable allowances from the 1st of January this year and full restoration from the 1st of September. That is not the total figure, Sir. The total figure is much greater. But the rest are offset seemingly by savings to meet the increases.

Mr Speaker, Sir, since this Government took office, the issue of the variable allowances of civil servants has been made a headache - a headache for the Assembly, a headache for the people, and most of all, Sir, a headache for the civil service and particularly 6,000 of them.

In moving this amendment, I am seeking to ask the Government to consolidate the variable allowances into the pay of the civil service, so that there can be no further reductions. I am not asking that they should receive one cent more of salary.

All I want is to take the question of the pay of the civil servants out of politics. Sir, they are entitled to security; they are the very backbone of our administration. In fairness I think the Government will admit our civil service has been reasonably efficient. And frankly, Sir, I know of no other civil service in the whole of Asia with such a high standard of integrity. In many cases, I think the Government will frankly admit that the civil servants are radically underpaid compared to the responsibilities we place upon them. It is important that these human beings, from whom we expect so much, should at least have a sense of security free from the possibility of political intimidation.

I intend to be brief, Sir, but I ask your indulgence to review shortly the history of P.A.P. dealings with the civil service on this one aspect of variable allowances.

In June 1959, Sir, this Government took office through an overwhelming vote of the people of Singapore, but it was generally recognised that the English-speaking population, in all probability, did not vote for the P.A.P., particularly the civil service. Before this Government even appeared before the Assembly, one of the very first steps it took was to slash the variable allowance of the civil service. And in His Excellency's speech to this House outlining Government policy on the 1st of July, 1959, he said:

`The threatened deficit of S14 million for 1959 can he and will be wiped out and the Government has not shrunk from unpleasant measures to achieve financial stability. But such sacrifices as have been imposed by way of pay cuts have fallen on those most able to hear them.'

My reference, Sir, for your record is Assembly Debates, Vol. 11 No 1. Col. 6.

`Those most able to bear them', Mr Speaker! How little did the Government recognise that of all our citizens, the honest civil servants are the ones who budget most carefully according to their incomes, and any radical reduction means very real hardship. In any event, Sir, as was pointed by the Leader of the S.P.A. in the debate on the Address in the following year, on the 8th August, 1960, it transpired that there was no $14 million deficit. There was not even a $1 million deficit. There was $9 million surplus.

Even if it can be said, Sir, that the Finance Minister did really make so big an error as $23 million in his estimate in our inevitably small budget, why did the Government not restore the pay cuts the moment it was recognised that Singapore was not going bankrupt? That Singapore, in fact, was stable and was doing very well? In fact, there was a surplus and not a deficit. Why did they not restore the pay cuts? In fact, Sir, the leader of the S.P.A. - more credit to him - moved in this Assembly, on the 8th of August, for the restoration of the pay cuts. But the Government, using its steamroller majority, defeated that motion. Sir, it is interesting to remember that in this very Assembly, on 21st July, 1959, the Prime Minister said:

`What they are bellyaching about is not the principle of negotiations. The bellyache is the pay cut.'

The civil servant could not even moderately and constitutionally and legitimately complain about a pay cut without being called a "bellyacher". That was the attitude of the Government, and, in fairness. Sir, it is true to say that in those debates, as I have read them in Hansard, Government vehemently denied that the pay cuts were by way of revenge against the English-educated for not having voted for the P.A.P. But, Sir, what do we see now? From 1st January, after tremendous efforts, a partial restoration: first to those who agreed that that would be final; then ultimately to all. And then, Sir, lo and behold, a miracle happened! The pay cuts were restored in full from the 1st of September. And His Excellency, in his speech to us last month, said that with merger in prospect it is possible to relax many of the stringent measures of economy previously adopted. With "merger in prospect" also, Sir, a vast sum of money will no doubt be voted to the Federation, and we would have less money to spend. But be that as it may, Sir, merger is two and a half years ahead, if, and I hope with all my heart it does, come to merger. Why is it that the Government is in such a hurry to restore the pay cuts now? Sir, in this context, let us face another fact of life. In 1959, the Government could say, "We do not care about the English-educated. It is the Chinese industrialists who will vote us into power." And they did.

The Prime Minister: The industrial workers, not the industrialists.

Mr David Marshall: Thank you. I am indebted to the Prime Minister. He recognises the P.A.P. stand so well. He has aptly and correctly corrected me. I accept it. "We do not care about the English-speaking; it is the Chinese industrial workers who will vote us into power." And they did. Today the Prime Minister and, I have no doubt, the rest of his group are all too conscious that they have lost the confidence of the Chinese industrial workers. And if they hope to survive, it is the English-educated on whom they are to rely. Sir, whatever the motivations of the Government, I would suggest that their conduct does give rise to feelings, and legitimate feelings, of fear, intimidation and insecurity on the part of the civil service. I plead, Sir, let us put an end to this.

I do not want them to worry next time we have a general election, having learnt their lesson, if they vote P.A.P. and suddenly the S.P.A. come into power - and miracles do happen - may be they will get another thrashing. Let us protect the civil service, legitimate protection which an honest. decent group seeks. Many of them could earn far more in the outside world. They join the civil service sometimes out of a sense of dedication, but mostly, Sir, because of their desire for security. And I say, let us protect the civil service from a legitimate deep fear that has grown from government action of possible intimidation. I say, let us help keep the civil service out of politics. We all recognise that that is the only way in which they can serve the country best. I, therefore, move this amendment in order to urge the Government to consolidate the pay cuts, not to pay the civil service more.

The Minister for Finance (Dr Goh Keng Swee): Mr Speaker, Sir, I thought the motion to amend the vote under Head 42 by the Member for Anson was, in fact, related to the administration of the Office of the Official Assignee and Public Trustee. The Member for Anson, however, brought up the larger issue of variable allowances.

Sir, he made a number of allegations against the Government and the Party in power in respect of the motive underlying this measure. He claimed that the reduction of variable allowances was an act of political intimidation. Sir, we know that the Member for Anson is given to oratorical pyrotechnics. But by no stretch of the imagination can this measure be called political intimidation.

3.15 p.m.

In 1959, when the P.A.P. was returned to power, the prospect ahead of us was by no means easy, it is true we had a formidable majority in the House. It is also true that at that time we realised that the struggle for power in Singapore between the Communists and the non-Communists must eventually come out into the open. When and over what issue no one could at that time predict. At that time it was clear that the Government of the Federation of Malaya would not even entertain the idea of merger. Singapore, to all accounts, by all possible forecasts made by reasoned men at the time, would have to go it alone for a considerable number of sears. We are a small island with no resources, with a bursting population and a mounting unemployment problem, it is obvious that, if we were to survive as a going concern, to provide enough jobs for a growing population, there must be a tightening of the belt all round. We could do it voluntarily by deliberate Government policy, or it could be imposed through the sheer hard facts of economic processes. We decided at that time that we must lay aside as much savings as possible from current income in order that we could have the resources to mount a substantial rate of capital development to ensure that the economy expands fast enough to give jobs for the growing population.

Sir, this is so elementary a principle in economics that I do not think I need labour the point. When it comes then to tightening the belt, it is only proper that those in the Government should provide leadership, in particular civil servants in the higher income bracket.

Sir, the Member for Anson claims the civil service has high standards. I will not dispute that. I have already paid my compliment in public to the integrity and effectiveness, within limits, of our civil service. But he claims that, by and large, they are underpaid. Sir, this I will dispute. There are certain categories - professional men - in short supply for whom even the present rate of pay in Government service will be inadequate in comparison with what they can earn in private practice. That is conceded. But the fact that in a few occupations members can earn more in private practice than in Government service does not entitle one to generalise over the inadequacy of pay in the whole civil service. I would say that there are a priori grounds for believing that the rate of pay in civil service from the long-term point of view is too high.

Sir, we all know that the pay of local civil servants has been geared to the pay of expatriate officers. The basic pay is the same and the variable allowances are the same. The expatriate officer gets some $200 to $250 more as expatriate allowance. In respect of the higher-ranking officer, the difference between the pay of a local officer and his expatriate counterpart may be about 10 per cent.

Sir, one of the factors by which we can assess whether the level of pay is adequate or not is surely whether the country can afford that rate of pay. One of the criteria we can apply is the wealth of the country. How does Singapore compare with, say Great Britain, in regard to national wealth? How does our per capita national income compare with that of the British per capita national income? Sir, I can assure you that we certainly do not come anywhere near 90 per cent of the British level. Then, on those general considerations, I would say that the statement by the Member for Anson that our civil service is underpaid cannot be sustained.

Sir, as to the present situation in the market for the services of civil servants, it is, of course, highly abnormal. Malayanisation has been going on for some years. There has been an abnormal and large demand for administrators, technicians and so forth to man the civil service posts that were once occupied by expatriate officers. But this is only a temporary phase. Eventually, these posts will be filled and the demand for civil servants will find its own level. It is only when we reach that stage that we can really come to a proper assessment whether or not we are overpaying or under-paying our civil servants. Therefore, until we reach that point, there is no question of consolidating the variable allowances now being paid to civil servants into the basic salary.

Sir, the Member for Anson has seen fit, in the course of his remarks, to discourse on the P.A.P.'s attitude towards the English-educated. He has claimed that we have lost the support of the Chinese-speaking industrial group and that our survival depends on getting the support of the English-educated. Sir, it is obvious that the ideas of the Member for Anson on matters of political strategy are exceedingly innocent, because that is not the way you calculate things; that is not the way in which you decide your policy. The English-educated, in terms of voting strength, are unimportant. They may amount perhaps to some 15 per cent of the total electorate. Their contribution is not the manner in which they cast their votes either for one Party or one programme or the other. That is not the decisive function they fulfil. They have a role to play. This we had stated right from the beginning before we formed the Government, not merely after we formed the Government. It is certainly not after the defection of members of our Party to pro-Communist groups. We have said that the English-educated are, in a sense - and only in a sense - the prototype of the future Malayan, because he has transcended the communal barriers, whether he be a Malay, an Indian, a Chinese or a Eurasian. He has a feeling of group identity that transcends communal barriers. He has also absorbed certain values of personal liberties which are essential in the running of the democratic system. But where he has failed is that, in the course of events under colonial rule, he has occupied a position of privilege as regards job, income and career as against other groups. To that extent, he has isolated himself from the other sections of the community. We, of the P.A.P., have always been saying that the role of the English-educated is to get out of the state of isolation and provide leadership, ideas and organising ability in the movement to create a new Malaya. To say that we have reduced the variable allowance as a measure of retribution against the English-educated because they did not vote for us in the general elections is, I think, something that is too foolish to need justification.

Dr Lee Siew Choh: Sir, it is pitiful to see the Minister for Finance humming and hawing, shilly-shallying, trying to defend himself -

The Chairman: Order. May I remind the Member for Queenstown that there are such things as parliamentary language, decorum and dignity?

Dr Lee Siew Choh: It is good to see the Minister for Finance trying to enumerate the virtues of the civil service and the English-educated. Let us remind them that only two years ago the Prime Minister said this of the civil service and the English-educated, "If nothing else more catastrophic happens to the civil service than the loss of their allowance, then they should go down on their bended knees and thank the gods (or something to that effect) that their souls have been spared." These are words not of people who really respect the English-educated and the civil service. Now, when they realise that they have really lost the support of all the Chinese-educated, they are hoping to catch some votes from the English-educated. They go along to hand back the pay cuts. Everybody knows that this so-called prospect of the so-called merger has nothing to do with what is happening. Why must they bring merger in? Do you think the people can be easily fooled, that they will support that type of merger just because they get back a little bit of the pay-cut? They must go back to school again and study psychology. Why? [Interruption.] Yes, that is correct, Sir. The Minister for Finance should go to Woodbridge and take a course there.

I am also interested in the fact that neutrality has been mentioned about the civil service. We are all interested in the neutrality of the civil service. The Prime Minister himself has said that the civil service should be neutral. Yet only a few days ago we heard a civil servant talking over the radio about merger. What right has he to talk about merger?

3.30 p.m.

The Chairman: Order. I think I have had occasion in the past to indicate to hon. Members that speaking in a loud voice - to put it very mildly - is not what one would expect in this Assembly.

Dr Lee Siew Choh: My apologies to you. Sir. But anyway this is no neutrality of the civil service. Why do they make use of the civil servants to fight and speak for them over Radio Singapore? They are misusing the facilities of Radio Singapore to propagandise their own way of merger. Let us tell them that if they want to talk of the civil service or anybody, they must always respect the principle of negotiation in all their dealings. This is only one example of their arrogance. Let them learn not to be so arrogant in future. Maybe they will do better -

An hon. Member: Get some votes!

Dr Lee Siew Choh: - and get more votes possibly.

Tun Lim Yew Hock (Cairnhill): Sir, I had not thought of joining in this debate, but when the Minister for Finance tried to explain away that the arbitrary imposition of the pay cuts was not a political move -

Dr Goh Keng Swee: Intimidation

Tun Lim Yew Hock: He would prefer "political intimidation". Let me try to explain. Did not the Minister in this very House thump his chest and say, "We the P.A.P. shall never retreat." Never retreat, indeed! Brave words! Today they have retreated, because there seems to be no traffic police to stop people crossing from that side to this side. [Laughter].

The Chairman: Order. Mr Serjeant at Arms, I think you ought to see that order is maintained in the Gallery. Tun Lim.

Tun Lim Yew Hock: When they first came in, they were all in white - pure white, like innocent lambs! Today they are in all sorts of colours - pink, red and even black.

The Chairman: Order. Is the clothing of Members relevant to what we are discussing? I might have an attack on my wig! I do not think that is proper.

Tun Lim Yew Hock: Sir, it is relevant to this extent - that when they first came in pure white, the very first words they uttered were, "We the P.A.P. are a good, clean and honest Government." Good, clean and honest, indeed! Today, there is no more of that kind of -

The Chairman: Order. I think the hon. Member must at least try and understand what is in the mind of the Speaker. When he indicates that that type of language or speech is irrelevant, it is irrelevant.

Tun Lim Yew Hock: I bow to your ruling, Sir, but let us say that the Government had to beat a retreat in spite of the fact that they had said that they would never retreat. What did they do? They said, "All these allowances can only be paid back to those who have joined the A.U.P.E." - a P.A.P.-sponsored trade union: [Hear, hear!].

The Chairman: Order.

Tun Lim Yew Hock: Is this not a kind of intimidation of the civil service, to join a union that is controlled by the P.A.P.? The word "intimidation", Sir, has been suggested by the Minister for Finance himself. Today when the poor, strong, good and honest P.A.P. is reduced to just 26 against 25 on this side. "Oh, semua boleh balek. You will get back everything, boys. Never mind, merger is on the way. Take everything back." Is it not a fact? Everyone knows it. Even the civil service knows it. Of course, the P.A.P. will not admit it. But certain former Members of the P.A.P. who are now on this side of the House will say, "Yes, it was meant to teach the English-educated a lesson and to show to the Chinese-educated that although the P.A.P. Government could not raise them to the level of the English-educated, they had at least brought down the English-educated to the level of the Chinese-educated." That was the intention. No words from the Government will ever convince anyone that that arbitrary move, without even consulting the trade unions who were at one time led by them, was not a political move or intimidation of a kind which can only be described as "P.A.P.-style"!

The Prime Minister rose -

The Chairman: Mr Prime Minister.

Tun Lim Yew Hock: Just a second Sir. There is one point the Member for Anson has brought up. It is very short.

The Chairman: Order. I must remind hon. Members that the time allotted for this topic ends at a quarter to four. I have no doubt the hon. Member will give an opportunity to the Government side to reply.

Tun Lim Yew Hock: I understand, Sir, but this will only take just half a minute.

The Chairman: Tun Lim.

Tun Lim Yew Hock: The Member for Anson has suggested that the variable allowance should be absorbed into the basic pay so that the basic pay would not be at the tender mercies of the government of the day. From the little that I know of the Constitution of the State of Singapore, may I say that the basic pay is always subject to reduction should the need arise? The protection afforded by the Constitution is in so far as the payment of pensions is concerned. It has nothing to do with the basic pay. Any government of the day can reduce, increase, or let it remain static, depending upon the financial situation.

The Prime Minister: I think when Members rise to speak on certain topics in this House, they sometimes speak only to certain sections of the community. If one were talking to the English-educated, like the Member for Queenstown and the Member for Cairnhill, then one could say, "What a wicked and tyrannical act it was to cut down the allowances and so on." One could also, like Mr Rajendra and S.A.T.U., say, "Back-date all these pay cuts. The mass of the people of Singapore will support it."

An hon. Member: S.A.T.U. is genuine.

The Prime Minister: Mr Rajendra spoke on behalf of S.A.T.U. He promised to support S.A.T.U. He was a Joint Secretary. But, Sir, not a single word of that statement appeared in the Chinese Press, because the Chinese component of S.A.T.U. knows that the Chinese-educated feel that the English-educated civil servants are paid too much. Whether it is right or wrong, that is an existing feeling. If you take Singapore by itself - 75 per cent Chinese, the majority of them are Chinese-educated - then I say the relentless logic of numbers of people seeking employment - equal opportunities as the English-educated - must lead to a position where the common denominator finally prevails. If you have a cake and you divide it equally among the Chinese-educated, Malay-educated and English-educated, the man who formerly got a larger piece is likely to get a smaller piece, and vice versa.

I give now, Sir, the political explanation as to why the variable allowance was restored, and I think the English-educated civil servants have enough grey matter to calculate this. I am not interested in whether they vote for or against the P.A.P. That is a triviality. [Interruption].

Sir, we have faced many a peril and we have passed through many a valley of death and survived. [Interruption] Their test is yet to come, and I hope I will see fierce men and women of courage and conviction. [Interruption].

The Chairman: Order.

The Prime Minister (Mr Lee Kuan Yew): But if you take it on a Pan-Malayan basis where Pan-Malayan opinion is different, because you have large numbers of Malays. English-educated and Tamil-educated who believe that the right way of doing things is somewhat different from the way the purely Chinese-educated think, then naturally you have to find a new denominator. It is as simple as that. As my colleague the Minister for Finance has explained, the 15 per cent English vote can make no decisive difference in any election. Their role is to ensure that the machinery of the State functions and ticks, because they are in key positions. The security of the State must be upheld. Its integrity must he protected. They know that if the Member for Queenstown had his way and he was today here in charge of the government -

An hon. Member: The incoming Government.

The Prime Minister: - on behalf, not of his 13 Assemblymen, but of men more powerful and more able than himself -

Dr Lee Siew Choh: Mr Lee Kuan Yew.

The Prime Minister: Sir,I am an open leader. I have no principal behind me. I am my own principal. I am not a proxy [Interruption].

The Chairman: Order.

The Prime Minister: I am not a proxy for anybody. I have no Committee other than the open P.A.P. Executive Cornmittee that decides.

An hon. Member: No hack-seat driver.

The Prime Minister: What the people of Singapore must understand is this - and they do understand it - it is not the Member for Thomson or the Member for Queenstown who is going to run the government - either this one or the next one. Nobody is silly enough to believe that. Anybody who can add two and two together to make four knows that these representatives of the people are also representatives who take directives from illicit groups and organisations and who fear the open confrontation of the open encounter and the open argument, because the principal is not there to set the line. The wrong line is taken in a forum. There is no time to refer back to the Committee. A remark made and admitted, a concession made in the argument sets the line on citizenship and on other matters. I think the Member for Queenstown will not relish a second encounter with the Member for Kreta Ayer.

Dr Lee Siew Choh: Any place, anytime!

The Chairman: Order. The Member for Queenstown appears to be disregarding the authority of the Chair. I think I have had to say "Order" about three or four times. There is a Standing Order under which I could act. I could say that that was grossly disorderly. I could ask any Member who is grossly disorder to leave the Assembly Chamber. I do not wish to do that. I would like to impress upon hon. Members that the Chair becomes a hit impatient when its authority is just flouted. Mr Prime Minister.

The Prime Minister: So you see, Mr Speaker, Sir, this question of making it permanent carries the matter no further. There is no finality in any constitution. The finality is the strength of the State. If that strength passes into the hands of those who want to see that state altered and who have the force to implement their will - and force means literally physical force - then no guarantee in any constitution is worth the piece of paper it is written on. Pakistan had a Constituent Assembly that deliberated on its Constitution for a decade, and brilliant lawyers they were. But the ultimate authority is the authority of the man who can implement his will. If the will is that of Singapore alone - the civil service can do their computation - then I say allowances will go down. It is logically inevitable. But if the will is that of the people of Malaya as a whole, then a different situation prevails, because the weighting is different. It is simple. Fur that reason -

3.45 p.m.

The Chairman: Order. The time allotted for this item has expired, hut I have no doubt that hon. Members will have enough opportunity to continue this exciting debate when debating the Yang di-Pertuan Negara's speech.

Question on the amendment put, and negatived.

The sum of $6,480 for Head 42 ordered to stand part of the Third Supplementary Estimates of Expenditure for 1961.

The Chairman: Heads of expenditure undisposed of. They appear in the Summary, other than Head 42. I propose to take those heads of expenditure* en bloc.

• Following are the heads of expenditure:- Head Title $ 2 Judicial 53,720 4 Legislature 12,540 6 Audit 8,970 12 Deputy Prime Minister 17,140 19 Vehicles Registration 24,130 31 Contributions and Charitable Allowances 250,000 44 Social Welfare 250,000 53 Immigration and Passports 102,400

Question, "That the sums stated for the heads stated in the Summary of Totals contained in Paper Cmd. 29 of 1961, other than for Head 42 already disposed of, stand part of the Third Supplementary Estimates of Expenditure for 1961", put, and agreed to.

Question, "That the sum of $725,380 shall be supplied to the Government under the heads of expenditure for the public services shown in the Third Supplementary Estimates of Expenditure for 1961 contained in Paper No. Cmd. 29 of 1961", put, and agreed to.

Resolution to be reported.

Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the Assembly.

3.47 p.m.

Dr Goh Keng Swee: Sir, I beg to report that the Committee of Supply have come to a certain resolution.

Resolution read.

Dr Goh Keng Swee: Sir, I beg to move that the Assembly doth agree with the Committee on the said resolution.

Question put, and agreed to.

Resolution accordingly agreed to.

Mr Speaker: We are back to Questions. Mr Ong Chang Sam.