MUTUAL BENEFIT ORGANISATIONS (AMENDMENT) BILL

Order for Second Reading read.

7.26 p.m.

The Minister for Social Affairs (Inche Othman Bin Wok): Sir, I beg to move, "That the Bill be now read a Second time."

The purpose of this Bill is to introduce several amendments to the Mutual Benefit Organisations Ordinance, 1960.

Under the existing Ordinance, section 5 gives the Registrar power to refuse registration of a proposed mutual benefit organisation only if such organisation bears a name which is identical with another registered organisation. This section will be repealed and a new section re-enacted to empower the Registrar to refuse to register a mutual benefit organisation, inter alia, if he is of the opinion that the scheme for the benefit of its members as provided for in the rules of the organisation is undesirable and not in the interests of would-be members.

Section 15 of the Ordinance, which exempts mutual benefit organisations from the Societies Ordinance, will be repealed as the Societies Act, 1966, has expressly provided for registered mutual benefit organisations to be exempted from the provisions of the said Act.

A new section 22A is being introduced to enable a mutual benefit organisation to utilise its reserve funds for purposes approved by the Minister. Under the existing Ordinance, subsection (2) of section 22 allows the reserve fund of any mutual benefit organisation to be placed only in the Post Office Savings Bank, on deposit with a bank of the Malayan Exchange Bank Association in the name of the organisation, or be invested in trustee securities.

This Bill also seeks to introduce a new section 27A to empower the Minister to freeze the bank accounts of a mutual benefit organisation if he is satisfied that there is a likelihood that the funds of the organisation may be misused. This power can only be exercised after the Registrar of Mutual Benefit Organisations has given notice in writing to cancel the registration of a mutual benefit organisation.

A new section 27B is also being introduced for the purpose of empowering the Registrar or a police officer to seize the account books, records and documents of a mutual benefit organisation at any time after the Registrar has given notice in writing to cancel the registration of the mutual benefit organisation. This is to prevent the falsification of the account books, documents and records of a mutual benefit organisation by dishonest and unscrupulous officers.

Finally, section 39 (2) is being amended to increase the fine on conviction of an offence under section 39 (1) from the maximum of $100 to $200. This increase in penalty will be a greater deterrent as past experience has shown that most mutual benefit organisations do not appear to take heed of warning given by the Registrar of Mutual Benefit Organisations that court proceedings will be instituted against them knowing that the maximum fine which may be imposed is only $100.

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. -[Inche Othman Wok].

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