DEVELOPMENT FUND (AMENDMENT) BILL

Order for Second Reading read.

5.19 p.m.

The Parliamentary Secretary to the Minister for Finance (Mr S. Ramaswamy): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Mr Speaker, Sir, the Development Fund Ordinance (No. 52 of 1959) was enacted to allow the Minister to vire funds from subhead to subhead; the only limitation being the amount available in subheads from which funds are to be vired. However, the Minister does not have the power to create a new subhead even when funds from other subheads are available. This has resulted in unnecessary delays in the implementation of urgent projects.

The Ordinance has been in operation for the past six years and, in the light of this experience, certain amendments to the Ordinance are necessary.

The Development Fund (Amendment) Bill, 1967, seeks to bring the Development Fund Ordinance (No. 52 of 1959) in line with the Financial Procedure Act which was passed by Parliament in April 1966 to empower the Minister to create new subheads and to transfer any surplus arising under any other subhead of the same head to the new subhead created; that is, it follows a similar procedure as that for the ordinary Estimates. This is provided for under clause 2.

The use of virements using savings from one subhead to meet increased expenditure under another subhead may lead to slackness in planning projects in the knowledge that there are savings to be vired from somewhere, or a tendency to withhold implementation of difficult projects on the excuse that funds for such projects are urgently needed elsewhere. To discourage the use of virements, a Contingencies Fund is provided to meet any urgent and unforeseen need for expenditure on projects for which no other provision exists. Expenditure on urgent development projects for which there is no provision in the Development Estimates will be charged to the Contingencies (Development) Fund. This fund will have to be replenished each year with resources in the Development Fund.

Section 4 (6) of the Development Fund Ordinance, 1959, which disallows the issue of transfer warrants in respect of a closed financial year, will also be deleted. In practice, transfer warrants have to be issued to regularise the Accountant-General's accounts. A vote may be exceeded inadvertently or owing to wrong entries. Transfer warrants are required to rectify such errors in the new year in respect of accounts of the previous year so that the accounts can balance.

Clauses 4 and 5 of the Bill deal with minor miscellaneous amendments arising from Singapore's independent status, such as deleting the words "Legislative Assembly" and "the Legislative Assembly" wherever they appear therein and substituting therefor the word "Parliament".

Sir, I beg to move.

Question put, and agreed to.

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

The House immediately resolved itself into a Committee on the Bill. -[Mr Ramaswamy].

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