ANNUAL BUDGET STATEMENT

Order read for resumption of debate on Question [7th March, 19721, "That Parliament approves the financial policy of the Government for the financial year 1st April, 1972 to 31st March, 1973.". -[Minister for Finance].

Question again proposed.

2.53 p.m.

Mr Sia Khoon Seong (Moulmein): Mr Speaker, Sir, the Minister for Finance's painless Budget, which was presented to this House last week, has been well received both inside and outside this House. What is most welcome is his declaration that no new tax measures, either directly or indirectly, are to be introduced for the next financial year. He has, in fact, "sweetened" the painless Budget with certain tax reliefs in order to benefit the common man.

The Budget Statement reflects the foresight of the Government and the soundness of its economic planning and its programmes of expansion in the past decade, and it exudes an atmosphere of quiet confidence for the future.

The tribute which the Minister for Finance paid to the workers of all ranks and occupations for their contribution to the success of Singapore's economic development is very appropriate. Now that the workers can see for themselves the fruits of their past efforts and sacrifices, they should have the determination to work even harder to ensure a continuing, if not greater, prosperity and progress in the coming years.

The actions of the Government, as reflected in the Budget Statement presented to this House, and elsewhere, have clearly shown that it is not oblivious to the part played by workers in the economic development of the Republic. As far as practicable, the Government has made every attempt to utilise the success of Singapore's economic development for social upliftment so that every citizen of Singapore, including the workers, will be able to cultivate a more gracious life-style that is in accord with their enhanced financial means. In this respect, the recent decision of the Government to increase the rates of the Central Provident Fund contributions and also to increase the remuneration of employees in the public sector in order to promote Government's home-ownership scheme for Singapore citizens, is highly commendable. It is natural that, with increasing economic prosperity, there should follow a rising level of our expectations which have manifested themselves in, for instance, the desire to own the house or flat in which we live, and also the desire for more and better facilities for recreational and cultural pursuits.

The setting up of the National Wages Council, in which the Government, the National Trades Union Congress, and the employers are equally represented, for the purpose of formulating guidelines on wages, indicates an awareness of the need for workers to be given an equitable stake in the fruits of the economic development and progress of Singapore. At the same time it is vitally important for the future of the Republic that wage increases should not be allowed to get out of hand or it would result in a vicious spiral of inflation which can only damage the interest of the Republic. The National Wages Council, therefore, has assumed a role of utmost significance not only to the workers but also to the rest of the people of Singapore, in that it serves as a regulator for the economic health of the Republic. In relation to the economy of Singapore itself and in relation to the competition among the developing nations of the world for foreign capital and investment, the difference between a rational and a chaotic wage policy can spell the difference between prosperity and disaster.

While the recent statement on the wage policy of the Government and other indications point to an era of greater affluence for the workers of the Republic, the fear that wage increases for the workers would be more than swallowed up by price increases is still valid. Legislation for price controls may seem to be necessary in order to eliminate profiteering by traders, but there are other practical considerations which are likely to stultify such legislation. For this reason, the N.T.U.C, has decided to initiate measures, which are compatible with the limited resources at its disposal, to protect the workers against the ravages of profiteering by unscrupulous traders. One such measure is the establishment of CASE (Consumers' Association of Singapore) to promote a greater consciousness among the individual consumers in Singapore against exploitation by traders in respect of prices, qualities and quantities of goods and services offered for sale to the public. Another measure is the proposal to set up a Consumers' Co-operative which, by offering goods and services to consumers at reasonable prices, will place the unscrupulous traders who charge extortionate prices at great risk.

In his Budget Statement, the Minister for Finance stated that steps are being taken to streamline the Immigration procedures to ensure that persons who can positively contribute to the economy of Singapore are permitted entry into the Republic. It also appears that the Government is encouraging employers, both in the public and private sectors, to establish schemes for the training of workers within the industry as part of a scheme to develop and to use our own manpower resources to its maximum so as to reduce our dependence on foreign labour. On the face of it, the policies of the Government in this area seem to be correct. I must, however, draw the attention of the Government to the difference between the formulation of a policy and its actual implementation. While the grounds for formulating a policy have been given the most careful consideration, the manner in which it is implemented is, however, not given the same amount of detailed consideration, and is consequently likely to be fraught with abuses, some flagrant, some petty.

Where the applicants are technicians and possess technical or scientific qualifications, no great difficulty is entailed in the evaluation of the economic significance of their talents. But where they possess skills which are based on aesthetic or popular taste, or fashion, for which there is no objective criterion, it frequently appears that the policy of the Government on the control of entry of foreign labour into the Republic is open to abuse.

A case in point is the employment of foreign musicians. With the help of the Tourist Promotion Board, some hoteliers and impresarios, have, under the pretext of promoting tourism, succeeded in obtaining entry permits for foreign musicians who are, in fact, no better than our local musicians. Many such foreign musicians, who have not been able to make a name in their own countries or have yet to gain inter-national national experience and reputation, are willing to take on jobs at very low wages. It is hard to believe that tourists who come to Singapore from the three main tourist countries, the United States, Japan and Australia, where their own artistes are of a much higher standard, are likely to return to be entertained with such inferior musical talent. As a result, there is resentment and frustration among the local musicians for being unable to earn a living in this trade or to obtain an opportunity to improve their skills for employment in the international market.

Recently, when it became apparently necessary for an advertising firm to effect a retrenchment exercise, a local executive, not a foreign executive, was given the walking certificate, regardless of the fact that the local executive was much better qualified. In such a situation, it would be extremely difficult for the Immigration Department to form an opinion as to whether the advertising firm should have dispensed with the services of the foreign executive rather than the local executive. The talents of a good advertising executive cannot be readily measured by any objective criteria. My point is that if an employer wishes to employ a foreign executive in preference to a local executive, it would not be difficult for him to advance one pretext or another to convince the Immigration Department of the need for an entry permit for the foreign executive.

All the abuses resulting from the present mode of implementation of Government's immigration policy in relation to foreign personnel, if left unremedied, would surely bring about a demoralising effect on the local personnel who are qualified to replace such foreign personnel. It is not only in the interests of our local technicians or executives but also in the interests of the Republic as a whole that the Government's immigration policy should be implemented in a constructive manner so as to give a fair balance between the need for foreign expertise and skill and the need to give our local citizens every opportunity to acquire such expertise and skill.

It is my hope that the Government will be able to take the necessary steps to streamline our immigration procedures so as to eradicate the abuses in respect of the employment of foreign personnel. In my view, it will be a step in the right direction if the Government is able to set up a "consultative machinery" whereby the Immigration Department could form a reasonably correct judgment as to whether the skill of any foreigner is of any use to the Republic.

3.01 p.m.

Mr Yeo Choo Kok (Delta): (In Mandarin): Sir, the present Budget is not only the third painless Budget in the last three years but it also provides six tax reliefs, especially in a situation of international monetary instability and the final phase of the British military withdrawal. This undoubtedly reflects our strong economic position and it provides a boost for the attraction of investment, both from Singapore and abroad. Obviously, the emphasis of the Budget is to meet the problems and the consequences of industrialisation and commercial development in the coming years. As the Minister for Finance has said, our aim is to transform Singapore which has an economic growth rate of 15 per cent into a regional centre for brain services and brain service industries within 10 years. This aim is very fitting to a country like ours. We should make full use of the good qualities of our people and try our best to develop industries which do not occupy large stretches of land, so that we may achieve and maintain an annual economic growth rate of 15 per cent. This will also help to complement the development of our neighbouring countries which have large expanses of territory.

According to the Minister, earnings from tourism continued to grow and showed an increase of 17.2 per cent in 1971 as compared with that for the previous year, 1970. However, the Minister also said that the hotel occupancy rate has fallen from 73.5 per cent in 1969 to 70.7 per cent in 1970 and down to 65.4 per cent in 1971. This shows that the hotel occupancy rate is going down while the number of tourists coming to Singapore is increasing. The Tourist Promotion Board should work out a solution, otherwise its expenditure on publicity and promotional efforts to attract more tourists will not be justified.

Of the six tax relief measures, that for accelerated depreciation for industrial anti-pollution devices is the most meaningful to the health of our people. The other reliefs will not benefit our people as much as this one. Our people, be they property owners or otherwise, have the right to enjoy a clean and healthy environment. The Government is expecting a loss of $3.5 million in revenue by implementing these tax reliefs. This shows that the interest of the masses is not forgotten. If the factory owners delay the installation of anti-pollution devices in their factories, then the Department concerned will have the right to take enforcement measures against them forthwith. As the Minister has said, these six tax reliefs are meant to assist Government's economic and social policies.

The Government has all along been trying to promote and to preserve the good cultural characteristics and heritage of our people and also to uphold the family link and good tradition of piety towards one's elders. All this is worth preserving. We can achieve this if we encourage our people to do it through our taxation policies and measures.

I hope the Minister will consider providing tax reliefs for taxpayers who maintain their parents. At the moment there is tax relief for the taxpayer's wife and children. Since we are going to increase the remission of income tax from $100 to $300 per annum for expenditure on maintenance of gardens, I hope that at the proper time the Government will also allow taxpayers a certain relief for the maintenance of their parents.

The painless Budget for the third year presented during a situation of international monetary crisis is most satisfactory to all. With the various measures proposed in the Budget, we will be able to achieve and to maintain an annual economic growth rate of 15 per cent.

3.07 p.m.

Dr Augustine H. H. Tan (Whampoa): (In Mandarin): Mr Speaker, Sir, I rise to offer my heartiest congratulations to the Minister for Finance for his very lucid presentation of the Budget.

Of greater consequence than the Budget details for next year is the ambitious development plan for this decade revealed by the Minister. The policies outlined are far-reaching in scope and are designed to implement vast economic and social changes in this decade. The economic changes targeted are tremendous for, at the rate of 15 per cent a year growth in Gross National Product, our G.N.P, will double in five years and quadruple within a decade!

The immediate question that comes to mind is whether the rate of 15 per cent is feasible. I believe it is attainable because the technology gap is still large and we can bring in the necessary expertise and manpower. Moreover, the strategy is to produce for world markets and to increase local skills.

The Minister has outlined five basic areas of policy, namely, manpower, science and technology, infrastructure, taxation and promotion. I would like to draw attention to four policy areas, two of which are not covered by the Minister's speech.

Wage Policy

The first concerns wage policy. The key terms of reference of the National Wages Council is to assist in the development of a wage structure, consistent with long-term economic and social development. There are four aspects here that need attention:

(1) Major wage changes will occur if demand greatly exceeds supply of labour. To prevent this, it is necessary to co-ordinate manpower supply and demand and to recommend appropriate immigration and increased supply of local skills. This is, by far, the most critical task in formulating wage policy.

(2) Increases in wage rates in the leading sectors affect adversely the supply of labour to other sectors. Wage adjustments in these sectors are necessary and can lead to closure of firms unless increases in productivity are made via better organisation, modernisation or incentive schemes. Here is where the National Productivity Centre can play a decisive role.

(3) From time to time, wage adjustments are also required in the public sector to prevent a drain of manpower and expertise. Here, the Wages Council can help via regular surveys of wages.

(4) In a rapidly growing economy, the income gap between the haves and the have-nots tends to widen, unless a conscious effort is made to prevent it. Here, the Government can set a good example by allowing a higher percentage increase in wages for low-wage earners and a lower one for high-wage earners.

Rentals and Land Policy

Apart from wage policy, attention must be paid to development of a coherent land and property policy. Appreciation in property values leads to higher rents which are passed on to consumers through higher retail prices. More crucially, production costs are increased, affecting our competitive position in world markets. Long leases on industrial land give windfall gains for some. Quite clearly, in the interests of equity and efficiency, a coherent land and property policy needs to be defined.

Pricing of Public Goods and Services

A further point I wish to discuss is the pricing of public goods and services, especially public utilities. These are public monopolies and their pricing policy affects producers and consumers. At present, each statutory board sets its own pricing policy, whether to cover costs only or to make a profit. I believe an overall advisory body to develop a consistent pricing policy for public goods and services is needed. Capital Market

In his speech the Minister referred to the importance of developing a capital market. The abolition of stamp duties on credit instruments is a right step. I believe some thought should also be given to the development of a secondary stock exchange to deal with securities which are riskier and do not meet present Stock Exchange regulations. The development of a capital market is important because modern corporations require more capital than the traditional family enterprises can provide.

Social Adjustments

One area which the Minister could not cover in his long Budget speech is the problem of social adjustments to rapid economic development. On recent occasions I have talked about the tensions arising from urban renewal, a growing income gap and the demonstration effects of spending by the rich on luxury goods. Immigration of workers will give rise to social frictions, since non-citizens do not enjoy the same housing, health and educational privileges. Recently, Government announced the provision of some housing for immigrant workers. Nevertheless, I foresee pressures developing for the easing of permanent residence and citizenship qualifications as young immigrant workers get married to Singaporeans. I am fully confident that the Government will be able to deal with these social problems. There is much more room for adjustment in an economy which is expanding!

I welcome Government's move to narrow the wage-gap between the public and private sectors and to narrow the income-gap. In particular, the increased tax relief for low income taxpayers and remission from estate duty on small estates deserve our full support because they are steps towards a more just and equal society.

Over the last 12 years the Government has worked for Singapore's long-term viability. It has never made empty election promises and has never hesitated to take strong and painful measures to secure Singapore's future. There is great concern for equity as the Budget shows, but not at the expense of our future. If Singapore is to achieve the bold targets laid down in the Budget in the next ten years, we have to ensure a continuing political stability.

Mr Speaker, Sir, I fully support the Government's policy as presented in the Budget.

3.20 p.m.

Mr Ang Nam Piau (Thomson): (In Mandarin): Mr Speaker, Sir, on the 7th of this month the Minister for Finance announced his Budget proposals, in which there are no tax increases or new taxes. Instead, there are increased tax reliefs which benefit the people in the middle and the lower income groups. This is a far-sighted and satisfactory budget. It is most welcome and has the support of all the people in Singapore.

The tremendous progress and stability and peace in Singapore can be attributed to the enlightened and able leadership of our Prime Minister and his Cabinet colleagues, together with the co-operation and hard work of our people. Over the past decade, these people have taken great steps and concerted efforts to ensure the success of our industrialisation and continuing prosperity of our country.

Mr Speaker, Sir, let us take a look at the countries around us, far and near. Their economic development is not as good as we would imagine. Every year they have to increase taxes in varying degrees. But the people of Singapore on the contrary have been fortunate to enjoy painless budgets over the past three years. These are clear indications that our economy is very sound, evidenced by a surplus in our budget.

Singapore is already modernised. However, our people should not be complacent with the present prosperity and success. They must take concerted efforts to continue the hard work to ensure that there is continuing economic growth for Singapore, and that there is always a great deal of surplus in our Budget.

Mr Speaker, Sir, let us now look at the advanced countries, such as the United States and Great Britain. At one time they had peace at home, and they enjoyed the greatest riches of the world. But because of the social indiscipline, lack of organisation and hard work on the part of their people in general, their economy is on the decline, resulting in the devaluation of the U.S, dollar and the Pound sterling. Therefore, what happened to them can serve as an object lesson to us. We must continue with our hard work and frugality. This is of great importance to a small country like Singapore.

With the advancement of science and technology and industrialisation in Singapore, other problems come into evidence. There are tendencies among our people to take life easy and to enjoy the good things of life. They tend to be more concerned with making money than with getting themselves interested in matters of national importance. They even resort to degenerating and corrosive habits. As a result, there is a mounting wave of crime and some form of social unrest and disorder in Singapore. For example, we can see that there is an increase in secret society activities, and that crimes like rape, gambling, murder, kidnapping, blackmail, traffic offences, and tax evasion, are being committed in Singapore.

Singapore is also subject to the degenerating influence of the West. Some of our young people take to "with-it-ism". They turn to drugs and keep long hair, thereby creating very serious social problems. These are the by-products of prosperity. This degenerating influence has come from Western countries which, although industrially advanced, do not care much about the welfare and problems of their youths. Instead of finding solutions to these problems, they resort to permissiveness. Therefore, we must be very careful about our youths. Half our population consists of young people under the age of 21 years. We must take immediate steps to ensure that our social discipline does not suffer or is not affected by such influences.

While the Government must continue in its economic and social construction, it must at the same time ensure that such corrosive influence from the West does not become too much of a problem in Singapore. We are a small country without natural resources. Although we have some cultural ballast inherited from the past, we must make sure that this poisonous and corrosive influence from the West shall not be allowed to gain a hold in Singapore, particularly to affect the youths. We must not allow our youths to degenerate as did the youths in the West.

I am glad to note that in this direction the Government has set up the Central Narcotics Bureau to take effective and immediate action to combat drug-taking. At the same time the Government has also declared "war" against long hair. But in spite of this action, we can still see people with long hair moving around in Singapore. They are still "at large". They claim to be "progressive", and are "with it". They even ignore the advice of the Government. I would therefore suggest that the Government take legislative action against the keeping of long hair. We should not be afraid of criticisms against us for being undemocratic and for interfering with personal liberty. I am sure that the people of Singapore will understand and will be on our side. In order to ensure that there is a fine and proper social ethos, the Government should also take steps in the following direction.

Firstly, yellow culture should be banned. To ensure that our young people and our work force are not corroded by this Western influence, the Government must take immediate steps to ban yellow publications and stop their circulation in Singapore. Instead, encouragement should be given to good and beneficial publications and film shows. The educational level of the people should be raised, and made fully aware of the evils of yellow culture. Healthy cultural activities shou1d be encouraged and conducted in the various sections of the society. In this way, the people will have beneficial and healthy recreations to counter the corrosive Western influence.

Secondly, low-taste films should be banned in Singapore. At present, there are far too many sword-fighting movies This is bad for our young people. We must further tighten the film censorship in the interest of our country. Films or movies which have a bad effect on our citizens should be banned. Instead, encouragement should be given to the screening of beneficial films in the cinemas. In this way, more educational films will be shown, and the people will learn through them.

Thirdly, I would urge the Government to take stringent measures against the importation and circulation of undesirable gramophone records from overseas.

Fourthly, the social ethos should be reformed. To do this, it is necessary to begin at home. Parents must set good examples to their children, and should not concern themselves merely with making money. Otherwise they would neglect the education of their children, which is equally important. Children will be well-educated only if they receive education both at home and in school Then they will be patriotic and able to resist the corrosive Western influence.. Therefore, I urge that, our economy permitting, there should be a whole-day session at secondary school level, so that students will be able to spend more of their time usefully in schools.

Mr Speaker, Sir, in short, the rise or fall of a country depends on the social ethos prevailing. No doubt, we must do all we can to ensure that our national economy is properly maintained. Moreover, we should remove all undesirable influences in our society. The people should be urged to work together and to work hard for the national interest. In this way, a bright future for Singapore is then assured.

Finally, Sir, on behalf of the people of Thomson, I support this Budget policy.

3.33 p.m.

Mr N. Govindasamy (Telok Blangah): Mr Speaker. Sir, the four hon. Members who spoke before me have aptly commended the Minister for Finance for his Budget Statement. I think this is the first time that any Finance Minister in any country has not only presented a Budget without new taxation measures but has also given away revenue amounting to $3.5 million approximately. I may be wrong. The historians in Parliament can clarify this. Any benefits to anybody, although the benefits given by the Finance Minister would not be for the lower income group, should be applauded. In fact, at the end of his speech, Members of the House did applaud in complete disregard of the Standing Orders.

Sir, we are grateful to the Minister for Finance who acknowledged the efforts of the workers for their contributions for a very successful year. With the rapid withdrawal of the British military forces in 1971, never in the wildest dreams did the people of Singapore expect a 14 per cent increase in our Gross National Product. However, this has been achieved, and the credit goes to the Government as well as to our workers for their hard work, dedication, restraint and co-operation. When I say "workers", I do not confine it only to workers in the private sector and lower ranks of the public service, but also include our top civil servants and senior statutory board employees. People who work with their brain are as much a worker as those who work with their brawn.

In my opinion our economic progress in the past few years has also been the result of the unique political situation obtainable in Singapore today - without any official parliamentary opposition as we have in this Chamber today. Sir, being a responsible Government, we have been able to plan and execute our policies with the object of obtaining what is good for our people. Our actions have been geared to what we can do best for the people to improve their material, cultural, educational and aesthetic well-being, without always worrying about what the Opposition Members of Parliament would say. In other words, as Back-benchers, we do not have the slightest desire to make a noise in Parliament just for the sake of it, so as to be able to subserve the purpose of getting votes. The time of the Ministers, Minister of State, Parliamentary Secretaries, Members of Parliament and civil servants has not been wasted in unnecessary, irrelevant, or hair-splitting arguments in order to score points and win votes for the Opposition political party, but rather spent usefully in planning for a better life for our citizens. If the composition of this House were different, if we had representatives from any of the irresponsible political parties that have mushroomed in recent months, we would have squandered a lot of time with arguments designed to catch the ear of the electorate, rather than to safeguard the interest or welfare of Singaporeans. Members on this side of the House have criticised the Government and will continue to do so not to score points, but to make constructive and objective criticisms. Very few people in Singapore realise that our achievements in the past few years, with odds against us, have been the result of all 58 Members of this House coming from the same Party, and that Parliament has been able to initiate necessary action with the minimum of fuss.

Sir, one newspaper has described our Minister for Finance, after his Budget speech, by saying that he has scored "first a hat-trick and then a Six". May I extend the analogy of the cricket language by adding that he has also played his way into the pages of "Wisdens". In fact, I have been waiting to hear criticisms from Opposition parties on the Financial Statement. Not a squeak has been heard, which goes to prove that our Budget has not been a mean achievement. Any Opposition party would be hard put to improve it. Sir, the increase in earned income relief will benefit about 33,000 taxpayers. The increase in the exemption from $6,000 to $12,000 in the net annual value of owner-occupied residences for income tax purposes will benefit house-owners, including those who live in palatial homes. Remission from Estate Duty on estates between $10,000 and $25,000 will benefit house and land-owning citizens, including Housing and Development Board flat owners. Good luck to them. Except for the $1,000 income tax exemption, I have looked in vain in our financial policy for benefits for our lower income group of workers, i.e, the one- room Housing Board flat dwellers, the unfortunate unemployable persons. Every citizen has a right to a share of whatever prosperity the Republic enjoys. The annual allowance of one month's salary for workers in the public sector is a welcome gesture. They now look forward to the Wages Council's recommendations. We hope this will provide some additional benefit in the form of an increase in wages for wage-earners.

Sir, what I am pointing out is that the lower income group will not benefit from the exemptions that the Finance Minister has outlined. We have to find ways and means of raising the standard of living of this group. One aspect of this is the anomaly found in the Public Utilities Board charges for use of electricity. Sir, the rich and the well-to-do live in comfortable air-conditioned rooms and pay at the rate of 7 cents per unit for electricity consumed. On the other hand, the poor, who cannot afford an air-conditioner, have to be contented with a ceiling fan which only circulates the hot air in the room, and they have to pay 18 cents per unit. I should think that the charge should be the other way round. This is one way of giving indirect relief to the lower income group. I am sure our able Finance Minister will find means of distributing our fortune a little more in favour of the lower income group than it appears in his Budget speech for this year.

3.44 p.m.

Mr Tay Boon Too (Paya Lebar): (In Mandarin): Mr Speaker, Sir, on behalf of the people of the Paya Lebar constituency, may I express my admiration for the Budget proposals for the new financial year announced by the Minister for Finance.

Mr Speaker, Sir, if we look at past history and at conditions prevailing in the surrounding countries, we will find that if the financial policy of a country is to allow a small number of people to enjoy a better life and to force the majority of - the people to go through a more difficult and hard life or suffer greater hardships, then the economy of that country will go from bad to worse. It might even go to a point beyond redemption. We all know that in any society the middle and lower income groups form the majority of the people. If they have a better life, then they will form the base of a motivational force in the country.

Mr Speaker, Sir, in this Budget for the new financial year, there is provision made for an extra one month's salary as annual allowance for civil servants and also for those working in quasi-Government bodies as announced by the Prime Minister earlier. The Government also intends to review the salary scales of the public service.

In this Budget also there are no new taxes. On the contrary, there are six tax reliefs. There is, therefore, no additional burden on the workers in the middle and lower income groups. This a wise and far-sighted move on the part of our Government. It is also in line with our Government's policy to strive for a more equitable distribution of wealth amongst the people. It has been the Government's policy all along that the income gap between the rich and the poor should be narrowed. The standard of living of the people should be raised. There should be greater equality among the various classes of people in our society. Therefore, in this respect, this Budget is a most outstanding one and we welcome it. It is not only a "painless" one but is also far-sighted. It is a positive contribution to the development of our country. If we analyse carefully the economy of our country, we can see that the economic development of Singapore is well advanced. However, there are still many difficult problems which will require our renewed efforts to overcome them.

Mr Speaker, Sir, in this Budget, there is a provision of $209,700,000 for the Ministry of Education. This represents an increase of $18 million over that for 1971. However, if we consider our education policy as a whole, we will see that the increased provision for this Ministry is mainly for the expansion of technical education in order to meet the increased demand for skilled workers for our industries. Under the present circumstances, in order to cope with the industrialisation programme of our country, there is a pressing need to train large numbers of workers to acquire the necessary technical skills within a short space of time. This is indeed a step in the right direction. It is, therefore, beyond reproach. However, from the long-term point of view, if we over-emphasise technical education to the point where we overlook or omit education in the social sciences and the other arts, then, I think this policy cannot be a perfect one.

Mr Speaker, Sir, let me quote an example. Today Singapore is going through a period of prosperity. It has been brought about through the able leadership of our political leaders, from the Prime Minister to the Ministers, Ministers of State, and Parliamentary Secretaries. All of them are not specialists in the technical field. Therefore, I think that in our efforts to train more and more people in the field of technical education, we should not overlook their training in the field of social sciences and other arts. We should not neglect this field of education, otherwise we will one day be faced with a situation where we do not have the people well trained in the social sciences.

3.50 p.m.

The Parliamentary Secretary to the Minister for Home Affairs (Mr L. P. Rodrigo): Mr Speaker, Sir, I join my fellow colleagues in this House in congratulating the Finance Minister for a Budget which is both instructive and stimulating. -

The announcement that there will not be additional taxes is welcome and the tax reliefs, especially of income tax on the imputed income of owner-occupied houses, income tax allowance for earned income for low income salary earners, and estate duty on small estates, will, I am sure, endear him to our people, but certainly to the people of Serangoon Gardens.

The low income salary earners in my constituency will appreciate the removal of the 20 per cent limit in the income tax deductions for earned income and the raising of the tax allowance to a maximum deduction of $1,000. The middle income salary earners in the Serangoon Gardens constituency who, by dint of diligent duty and by stint of scrupulous savings, have acquired a modest house for a home will also appreciate the remission of estate duty on estates between $10,000 and $25,000.

Sir, I trust that the Finance Minister's ministration of the exchequer throughout the new fiscal year will enable him to endear himself to all of us once more next year on a similar occasion, to which point my constituents and I look forward with abiding expectation.

But very much more than expectations will be required of each of us if we are to sustain the economic growth which we have registered so far.

Though our economic performance will be affected by international monetary and trading uncertainties, there is reason to believe that we have taken measures to protect our economy through a policy of selective investment by multi-national manufacturing companies which have, as the Minister puts it, "a scope for- progressive growth in technological content in their manufactures". -

The success of this policy depends, among other things, on the availability of an adequate indigenous technological capability together with the will and discipline to strive for economic growth and security. The former requisite may be achieved by proper planning, stimulation and organisation of human resources. The latter, however, is a human attribute determined by genetic endowment, values acquired in the family during growth and the persuasions of the social and cultural environment.

Today, a new generation in our society, born after the last World War, is bursting into adulthood and constitutes tutes the new manpower of the nation. While expecting the different social and intellectual responses and life-styles of a new generation, our survival as a nation demands that our human resources remain industrious, disciplined and relentlessly striving.

It is not enough to ensure the continuation of this human resource with the promise of personal gain. Personal gain is a strong motivation, but by itself it is socially disintegrative. And as we move into the era of the multi-national corporation and as our city shapes into a global city with global exposure, the problems of social integration and national cohesion become correspondingly more acute. In this situation, social discipline becomes a critical need. But at the same time discipline provokes resistance because, on the one hand, youth today is more enlightened and independent and, on the other hand, it is more intensely exposed to the liberal norms of behaviour of other societies. Indeed, Sir, the problems of a new and youthful generation are now only just emerging and will require our attention and energies in the immediate future despite - in fact, it is because of - the high growth rate which all of us hope will be achieved in the years ahead.

I have pleasure in supporting the motion.

3.55 p.m.

Mr Teong Eng Siong (Sembawang): (In Mandarin): Mr Speaker, Sir, on behalf of the people of Sembawang, may I express my support for this Budget for the next financial year which was presented by the Minister for Finance on the 7th of this month. His Budget Statement contained very good news. For example, not only will there be no new taxes, but there will also be no increases in the rates of existing taxes. On the contrary, six items of tax reliefs are granted; thus the benefits to the people are increased. Mr Speaker, Sir, these measures are for the welfare of our people. The good start that we have at the beginning of this year is, I am sure, conducive to economic expansion. It will be a stimulus to our plans for further industrialisation.

Sir, the Minister for Finance has made a detailed statement on the international monetary situation, and touched on, for example, the upward revaluation of the German Mark, the devaluation of the American Dollar, and the 10 per cent surcharge on all U.S. imports levied by the American Government in 1971. The effects of these measures on the rest of the world, more particularly South-east Asia, are severe. They have led to a recession in trade. However, a comforting thought is that, despite the international trade recession, we have been able to survive economically, and above that we have been able to achieve a growth rate of 14 per cent. This is a rare achievement. It goes to show that the economy of our country is strong, and that in spite of these difficulties and recurrent problems we have been able to achieve this high growth rate. We are thus able to enjoy the prosperity of our stringent economy.

Mr Speaker, Sir, the Minister has also mentioned that our per capita Gross National Product has increased from $2,960 in 1970 to $3,317 in 1971. As a result, the purchasing power of our people has also increased. This is an important factor in our prosperity.

Mr Speaker, Sir, the success of our industrialisation programme is dependent on good leadership and planning on the part of our Government. The departments concerned have been playing a leading role in this respect. However, our workers have also put in their efforts. The co-operation between employers and employees has also contributed to our success. Many of our factories have increased their production. Industrial disputes have been reduced to the minimum. In fact, the number of strikes has been minimal.

Because of all this, our Gross Domestic Product has increased substantially and the standing of our country is very high in the international scene. We have attracted more and more investors from overseas. This, in turn, will lead to a higher level of industrialisation and economic expansion. We know that this success is the result of the combined effort of all our people. We must ensure the qualities of perseverance and industry try of our people are maintained, so that in the coming years we can achieve yet greater objectives.

Sir, I would like to touch on the need for public health. As everybody knows, the medical care in our country has enjoyed a very good reputation. Following the rapid economic expansion of our country and population growth, the Ministry of Health has a greater and more important role to play. At the moment, we have three big hospitals. We have taken over the Sembawang and Alexandra Hospitals from the British Armed Forces. These two hospitals will contribute greatly to the well-being of our people.

Although we have achieved a great deal, there are certain areas for improvement. On the Ministry of Health, I would like to put forward two points. First, I hope that the Minister for Health will consider providing in the hospitals beds for parents whose children are hospitalised so that they can look after their children. Secondly, I hope the Minister will consider increasing the number of surgeons in our hospitals so that cases which require surgery can be dealt with speedily.

Sir, our policy is to build more hawker centres for the benefit of the hawkers, so that their standard of living will be gradually improved.

Sir, I would like to touch on the question of rural development. We know that our Government has been working hard to provide facilities for the people in the rural areas. A good example is Sembawang constituency. Through the efforts of the Urban and Rural Services Committee, the Government has provided more than a million dollars for the Sembawang area for various public services, such as road construction, drainage, rural electrification (Street lighting and domestic electricity) and water supply. All these projects have improved the appearance of Sembawang constituency. Of course, the Government has been working not only to benefit constituents in Sembawang but also those in the other rural constituencies. The Government has taken these measures to improve the lot of the people in the rural areas. It goes to show that the Government believes in the fundamental tenets of democratic socialism. It is also trying to reduce the gap in the standard of living between the people in the city and the people in the rural areas, so that everyone can enjoy the fruits of our economic growth. For the next financial year, the provision for urban and rural services is $3.25 million, as compared to 52.5 million for last year. There is an increase of about $700,000. This is, in fact, good news for the people in the rural areas. I am sure rural development from now on will continue to improve.

Sir, I am very happy to note that the Minister for Finance has emphasised in his Budget Statement the need for defence and national security. There is a need for administrative skills in matters of national defence, and the training of personnel in all the various fields can play an important part in raising the educational level of our Armed Forces. These measures are important for the strengthening of our armed forces. In addition, I think that there is also a need to inculcate a sense of patriotism and national consciousness in our youths, so that in times of crisis they will be prepared to make sacrifices for the country and for their homes.

Sir, all in all, the Budget for the next financial year certainly meets the approval of all the people in Singapore. Let me express my full support for the Minister and for his words of praise for the workers of Singapore. Because of the spirit of dedication of our workers, our country has survived the various international crises, and our economy is stable and prosperous.

Finally, I would like to call upon all the people in our country, irrespective of colour or class, to come together and, in a united effort, take part in nation-building and to strive for yet greater achievements in the next financial year.

Sir, I support the Finance Minister's Budget proposals.

4.07 p.m.

Mr Yeo Toon Chia (Kampong Kapor): (In Mandarin): Mr Speaker, Sir, in spite of the difficulties arising out of an international economic recession and the British military withdrawal, resulting in a loss of $400 million in British military expenditure, we are presented with yet another painless Budget. The Minister for Finance informed us that our Gross National Product has reached $7,000.8 million, an increase of 14 per cent over the previous year. This is a clear indication of the correct economic policy, our political and social stability and the diligence and verve of the people of Singapore. The announcement by the Prime Minister on the payment of an annual allowance of one month's salary to Government servants and the promise of salary adjustments in the next financial year is really a piece of good news to the civil service.

Sir, there has been a tremendous inflow of foreign capital into Singapore, coupled with a growth in construction, industrialisation and urbanisation, thus resulting in a rise in the prices of commodities. The cost of living is, therefore, rising, and this gives the situation in which wages and the cost of living are racing against each other, somewhat like a race between the tortoise and the hare. Therefore, the wage-earners are always in difficulty in the face of a rising cost of living.

Sir, our productivity is progressing, our economy is developing steadily, and our national income is increasing every year. As the Prime Minister and the Minister for Labour have recently said, the fruits of prosperity and economic growth should be shared equitably amongst all the people and should not be monopolised by a minority at the expense of the hard work done by the workers. The adjustments of wages and the rationalisation of conditions of work should be carried out now. We must raise their income, for in this way the working class will have a sense of security, and will feel proud that they are also contributing to the economic growth and prosperity of Singapore by their efforts. This will give them further impetus to face the challenge to increase their productivity. They will also be prepared to meet new changes and to continue to contribute to nation-building.

Sir, having achieved political, economic and social stability, we should now have a look at our society. A new or reasonable society does not mean that it is faultless or without failings. There are aspects of some of our people inclined to the darker side of our society. We must bring them round to the proper track, so that they can correct themselves. We must have the courage and the confidence to plan for further progress towards greater equality of all the people. We must think of ways and means to help the poor and aged people with big families, particularly the daily-rated employees. Because of their low wages, they have to take up part-time employment or even part-time peddling as unlicensed hawkers. Under the heavy burden and great pressure, they have to work day-in and day-out and most of them are plying their goods along the roadside to earn their living against the law. Therefore, we must try and devise some ways to assist these poor people. Perhaps we can grant them temporary licences or even give them a rent subsidy to help them tide over their difficulties arising out of low wages until their sons or daughters are able to work to supplement the income of their family.

Furthermore, we should also build more cr�ches in industrial or Housing and Development Board estates in order to allow the wives of people of middle or lower age group from this section to enter into the labour market, so that the total income of their family will increase and be able to meet the high cost of living. In this way, our work force will be increased to meet the needs of our industrialisation. We may make use of the community centres as cr�ches by improving and providing more facilities for the children. The cr�ches will also bring together children of various walks of life and ensure social integration at a very tender age. The children put in these cr�ches will benefit much from the education provided there. And with better education for the poor children, the vicious cycle of the poor people remaining poor forever from generation to generation can be broken down, and we shall be able to bring up a better generation for our nation.

Sir, as in other industrial countries, Singapore is also confronted with the shortage of labour. This is inevitable. According to the statistics provided by the Ministry of Labour, we have already issued 60,000 work permits. This serious labour shortage has brought about an immigration of foreign labour from neighbouring countries and even from countries far away. With this influx of foreign labour, we run the risk of having city slums and social problems. Unless we are prepared to build low-cost houses and to provide education for their children, our present standard of living and our economic objectives may be endangered by the influx of foreign labour. We should be aware of our own situation in dealing with this matter.

Sir, we must set up a plan for our long-term economic development in the context of our geographical position, population potential, land area and other relevant factors. Our national development must be determined by these factors. Although we have achieved full employment, we must try to prevent our workers from being over-selective, leading to great mobility in labour, wastage, and a reduction of our national productivity, thereby slowing down our economic expansion. Through the co-operative efforts of employers and employees and the Government, the workers must be told that their interests and the interests of the nation are interdependent. In fact, their interests and the productivity of the country in relation to a greater market are closely interlinked, because demands for products are dependent upon the purchasing power and it will increase with the benefit of larger profits which come from higher productivity and bigger markets.

Sir, let me now touch on the question of urban renewal and the problems brought about by the construction of numerous high-rise flats. We know that land is a scarce commodity in our country, and therefore there is a great need to build higher and still higher blocks of buildings. This is, in fact, the only option open to us. However, we should carefully investigate the problems brought about by these high-rise flats and the high concentration of population in small areas. We cannot allow factories, schools, shopping centres, supermarkets, and private firms to decide freely what their working or business hours should be, because this will create the problem of traffic congestion. Because of the shortage of land and the exorbitant costs involved in implementing the Mass Rapid Transit System, whether it be monorails or underground trains, we cannot at the moment carry out these projects. We should investigate to see whether there is a need to stagger their working hours, so that the problem of traffic congestion will not arise. Perhaps some of these shops and firms should be diverted or resited in less congested areas.

Under the urban renewal programme, many so-called high-class shopping centres have sprung up recently. They have been given a great deal of publicity. It is the hope of the people that these shopping centres will provide some sort of service to our society but, in point of fact, they are an "abnormal development" of our society, because their prices are very high. These high-class shopping centres are supposed to cater specially for the rich and the tourists, but there are only a few tourists. The majority of the consumers are, in fact, local people, and they are attracted by the expensive decorations and advertising gimmicks put up by local businessmen of these shops. Many of these shops have been attracted to site in shopping centres, but, in fact, their business is not all that good, because of the lack of support from the local clientele. What little they earn goes to pay for the high rentals. It is only the big developers who stand to gain from the construction of these so-called high-class shopping centres.

Sir, I think the Government should take a more concerted effort to establish the needs for a satellite town before we carry out such plans. We need to have more up to-date statistics to study the population trend, the urgent needs of the people which follow the progress of society. We should consider building modern multi-storey shopping complexes so as to provide better services and amenities in our housing estates.

With the construction by the Housing and Development Board and the Jurong Town Corporation of shopping complexes which are let out at reasonable rentals, the shops should be able to provide commodities at reasonable prices, so that the people in these satellite towns may be able to purchase goods at a fairly reasonable price. These measures will also help to divert the crowd and to reduce the problem of traffic congestion in the city areas. We have to construct shopping complexes to provide the people in the satellite towns with various amenities and services, so that their cost of living will be reduced. We should not consider providing services without caring for the purchasing power of the people. Sir, we know that we are a small country without any natural resources, but so far we have been able to achieve great economic expansion in the face of international uncertainties and disruptions. The payment of an annual allowance to Government servants is a rare step in this direction. I hope that with greater efforts we shall be able to achieve even greater things in the future.

As a representative of the people of Kampong Kapor, I support the Finance Minister in his Budget proposals.

4.21 p.m.

Mr S. Ramaswamy (Potong Pasir): Mr Speaker, Sir, the financial policy of the Government enunciated by the Finance Minister gives a picture of quiet confidence and visions of Singapore marching forward into the future full of promise. The fact is that, in spite of the effects of the British military withdrawal and the international monetary crisis, which for a time threatened to slow down our economic progress, the Government has ridden the crest and attained an advance in 1971 of about 12.1 per cent for the per capita G.N.P, at current market prices. This is a creditable achievement for which the Government must be congratulated.

A number of points, however, arise-when considering the Budget speech as a whole. A matter that should cause-concern is the increasing use of direct, trade policies by our neighbours. It is, I suggest, therefore, necessary for us to-formulate a policy to gradually minimise our dependence on traditional re-export commodities.

Tourism is another economic earner and, despite the increase in the number of tourists and in earnings (about ten times higher than 1960), there is a. decline in the occupancy rate of hotels since 1969. A question that naturally poses itself is whether our Tourist Promotion Board has done enough in the past. Though greater efforts must be-made to attract more tourists from Japan, Australia, and the rich European countries like the U.S.A., I think it will be prudent to step up efforts and projects to attract tourists from the less affluent countries also, so that the tourist industry could reap additional earnings.

The announcement that measures are being taken to reorganise the civil service and to restructure their salary scales is most welcome. The annual grant of one month's pay as a non-, pensionable allowance will go a long way towards narrowing the differences, in wages between the public and private sectors. However, these measures in, themselves are not sufficient to curb the flow of experienced officers into the private sector. I suggest that Government Service could be made more attractive by offering civil servants more liberal terms in respect of housing, car loans, and so on. To prevent a further flow of officers into the private sector existing measures should be tightened. Such measures would be justifiable because, by and large, those who leave for greener pastures use the knowledge, experience, and training that they have gained in Government Service.

There is no doubt that the private sector would very soon also see wage increases when the Wages Council makes its recommendations. The picture is one of promise and joy to our working population. But what lurks in the background is creeping inflation and spiralling prices in the wake of a general increase in wages. If this is not controlled, then wage increases will prove futile and barren.

Property Tax has of late been a subject of much discussion by house owners. Following an upsurge in rentals in 1970 and 1971, annual values were raised. The position is somewhat different now, as rentals have dropped significantly and the annual values fixed previously would now appear to have no bearing on the present rentals. I would, therefore, urge that a further review of annual values be made.

The need to increase Defence expenditure is recognised when we are continuing to build up our Armed Forces. No good and true Singapore citizen will argue about this, hut one can legitimately ask whether a sudden increase of 16.5 per cent over last year's expenditure is really necessary.

A matter that has of late been receiving the close attention of Government, trade unions and employers is industrial safety. The recent explosion in a barge in Jurong, in which five people lost their lives and another five seriously injured, is a tragic reminder that with new methods of work, new machinery and new working environments which come with progress in industrialisation, new dangers lurk behind the unsuspecting worker. It is, therefore, vital that the problems of industrial safety should be studied in greater depth, so that a comprehensive programme can be devised to meet not only known dangers but also possible dangers of which little or nothing is known now. Apart from the sorrow and suffering that industrial accidents cause to the injured worker and his family, the loss of workers, particularly skilled workers, in the context of a full-employment situation, is something that we can ill-afford.

With regard to our road transport, the traffic system is now in a chaotic state. Though steps are being taken to educate the public, to control the traffic, and to widen roads, and so on, unless a mass transport system is introduced in the next few years the problem will become unmanageable.

If subways are to be introduced, this is the opportune time because while the Central area is being reconstructed and with high-rise buildings coming up, subways can be constructed with minimum dislocation to the traffic system.

I would suggest that a Commission be appointed to look into the problem and to report on it.

4.30 p.m.

Mr Ho Kah Leong (Jurong): (In Mandarin): Mr Speaker, Sir, like my colleagues, I would like to express my support and convey my congratulations to the Minister for Finance for announcing his third painless Budget in this House. Sir, although we are not entirely out of the woods yet, our economy has all the time been going up instead of declining. This is largely due to the able leadership of the Government, combined with the strong will and determination of the people to overcome obstacles.

Mr Speaker, Sir, despite increases in expenditure for Defence, Education, Social Services, and others, the Minister for Finance has been able to balance his Budget without having to increase existing taxes or introducing new taxes. On the contrary, he has been able to introduce six tax reliefs. I must congratulate the Minister for Finance on this.

However, I must also echo the disappointment of the rural people. There is no mention in the Budget Statement of any change in the policy on agriculture and fisheries. I am not an economist, and so I will not be able to say how much profit can be made out of agriculture and fisheries as compared to industry, for the same amount of land that is being used. However, I know that some land should be allocated for agricultural purposes. I am sure most of us remember that during the Japanese occupation of Singapore, almost every family planted tapioca or potatoes for their own consumption. But now there is no land available in the city to grow even a plot of potatoes.

Most of our farmers are engaged in the production of supplementary food. Due to lack of proper care, they are left entirely on their own for survival. Agricultural land is continually being diminished. If, for any reason, there is further decline in the production of supplementary food, we will have to spend a great deal on foreign exchange in order to import food from other countries, and should this supply be cut off for any reason, we will all be starved to death. I, therefore, feel that definite policies must be formulated for fisheries and agriculture, in order to look after the interests of our farmers in Singapore.

Mr Speaker, Sir, there are about 23,000 families engaged in agricultural or fishing activities. Together with relatives and allied workers, merchants and hawkers, I think about 200,000-300,000 people are dependent on agriculture and fisheries for their livelihood. This constitutes more than one-tenth of our total population. So their contribution to our economy cannot be completely ignored.

Sir, there are signs that agriculture and fisheries are on the decline. We can see from the annual reports of the Primary Production Department that farming and fishing activities in Singapore are declining at a tremendous speed. We must do something to stop or check the decline. Because land is scarce in Singapore, we have to find ways and means to make the best use of whatever land we have and, after industrialisation, allocate some land to farmers for agricultural pursuits. However, the tendency is towards urbanisation and industrialisation. As a result, it is understood that agricultural land available amounts to only a small area of 33.000 acres. Apart from the small portion of private land, a greater part of it is State land, leased to farmers under Temporary Occupation Licences. Because they have to farm under T.O.Ls they always have the sense of insecurity and are convinced by the fact that they are often resettled from time to time. After resettlement a few unfortunate ones have to move again. As a result of resettlement, farmers experience great inconvenience and losses. The Government should therefore take steps to avoid resettling the farmers more than once.

Sir, farmers require land just as fish require water. Since land is leased to them under T.O.Ls, they are always liable to resettlement or eviction. Psychologically, this has a bad effect on them. Because of this, they tend to take things easy, instead of trying to find permanent ways and means to increase their production. This is a great blow to our agricultural activities.

Mr Speaker, Sir, although we are not in a position to implement "Land to the Tillers" scheme, we should designate agricultural areas and grant longer leases of, say, 30 to 50 years, so that they will be able to till the land for a fixed period, so that they can also plan for improvement and expansion.

Sir, as the Minister for Finance may probably be aware, the prices of primary farm produce especially of pigs and eggs, have gone down recently. In some cases, the prices have dropped to below cost. Some farmers are experiencing considerable hardships and are on the brink of bankruptcy. This shows the weakness of our agricultural economics. Farmers are engaged in these activities for a living and they only manage to make ends meet. But with the small returns they get, they cannot be sure of even three meals a day. This is the case not only in times when the harvest is poor, but also when the harvest is good. This is the result of the rising costs of fertilisers and animal feeds. Farmers normally obtain animal feeds and fertilisers on credit. They repay the suppliers for their fertilisers and animal feeds when they have a rich harvest. The suppliers act as a sort of middlemen and moneylenders.

Mr Speaker, Sir, in spite of the rising costs of fertilisers and animal feeds, the prices of primary farm produce are going down. We can see from this that a bad relationship exists between the primary producers and the middlemen. I can only use the word "exploitation" to describe the relationship, in the absence of a better term. Sir, farmers are not rich. They do not even have the money to buy things on cash terms. They have to purchase their supplies on credit. It is only when their livestock are big enough for sale and sold will they be able to raise some money to pay for the supplies of animal feeds and fertilisers.

Another difficulty which the farmers face is that when the harvest is plentiful, there is an excess of supply over demand. Again the poor farmers will be exploited by the middlemen and the suppliers of their animal feeds and fertilisers. As a result, the prices of their products dropped. They will then again experience difficulty in repaying the debts that they have incurred. This is an unusual phenomenon which should be removed. A socialist Government cannot continue to ignore the unreasonable acts of the middlemen who exploit the primary producers. Government must do something to ensure that everybody gets the fruit of his labour. All along their interests have been looked after by the Primary Production Department by providing them with technical aids. If the Government does not give further help to the farmers in the form of financial aid, planning, marketing and sales, then whatever benefits they may get from the Primary Production Department will be cancelled out, because of the low prices of their produce. There will then be no profit to the farmers despite all the technical aid provided to ensure good harvests.

Mr Speaker, Sir, at this time last year I asked the Minister for Finance about the establishment of an agricultural bank. After one year's deliberation, may I know what is the decision of the Minister? Even if there is no intention to set up an agricultural bank, I think the Minister should consider setting up a department in the Development Bank of Singapore to deal with financial matters relating to farmers and to provide low-interest loans. It is only through the granting of low-interest loans that farmers can rid themselves of the exploitation by the middlemen. This move will improve their well-being.

Secondly, the question of over-production is due to the farmers' lack of ability to analyse markets. They produce without any proper planning. But we cannot blame them for this, because they do not have either the knowledge, the data, or the machinery for analysis of the market. This work should, in fact, be done by the Primary Production Department, so that the problem of over-production can be solved. In addition to this, I think Intraco should also assist farmers to explore and open markets overseas so that the agricultural surplus products can be exported. I think the Government should also encourage the setting up of industries and factories processing agricultural produce. This will absorb the surplus farm produce.

Mr Speaker, Sir, to eliminate the exploitation of farmers by middlemen, it is necessary to set up a co-operative for farmers. The Government has been successful in the implementation of co-operatives for transport and insurance for the workers. So there is no reason why the Government cannot succeed in the field of agriculture. It is no use for Government officials to sit in air-conditioned rooms, expecting farmers to come forward and register themselves to form a co-operative. The Government should take a positive step to help the farmers, because they are usually very busy and they lack the necessary experience and knowledge. If the Government does this, great benefits will be shared not only by the farmers but also the consumers at large.

Mr Speaker, Sir, I would now like to touch on fisheries. We know that Singapore is surrounded by the four seas. But our fishermen can only catch one-quarter of our total consumption of fish. The Minister for Law and National Development has said that this is a shame. According to a survey our consumption of fish is the highest in Asia. The figure comes to 35.6 kilos per person per year. Following the increase in our population, the consumption of fish is bound to increase. It is estimated that by 1975, our consumption will reach the figure of 82,000 tons. On the other hand, we can see from the annual reports of the Primary Production Department that if fishing activities are declining and if allowed to continue, we would have to import more and more fish. Then this will not only lead to a loss in foreign exchange but, if there is any external factor, also to an increase in the price of fish. The people who stand to lose will be our home consumers. Sir, we know that the South China Sea and the Indian Ocean have an abundant supply of fish, and there is a great potential for deep-sea fishing. There are fishing trawlers from Taiwan and Japan catching the Tuna in the Indian Ocean, and they are exporting them to Europe. Why cannot we do the same thing? In fact, the distance from Singapore to the Indian Ocean is only half that from Taiwan or Japan. In the same way, there is no reason why we should not succeed.

Deep-sea fishing has not been developed to any significant extent in the last few years. The setting up of a Fisheries Training School is not sufficient by itself. Deep-sea fishing requires a large amount of capital and it involves great risks. Without the active participation of Government, there is not much prospect of deep-sea fishing developing as an industry. The Government has already withdrawn the pioneer industry status for deep-sea fishing. However, other kinds of preferential treatment should be given to encourage local and overseas businessmen to develop deep-sea fishing.

Mr Speaker, Sir, there is no conflict of interests between deep-sea fishing and off-shore fishing. Therefore, the Government should also encourage off-shore fishing. It is a fact that during the last few years the Government has neglected the development of off-shore fishing. In fact, it has regarded off-shore fishing as an archaic or useless occupation.

Mr Speaker, Sir, we must also look after the sea-beds from which large quantities of fresh fish are obtained. I am referring now to the small trawlers which operate near the off-shore areas, and in the process they affect the natural environment of the sea. The presence of these small trawlers makes the sea more choppy and, as a result, the fish and the prawns do not reproduce in large numbers. We should impose a total ban on the operation of these-small trawlers in the off-shore areas. The Marine police and the Primary Production Department should co-operate in this respect. During the last year, only eight trawlers were arrested and we-cannot help but have some doubts on the efficiency of the Marine Police.

Mr Speaker, Sir, I shall now touch on the question of reclamation. We-know that the large-scale reclamation of land has led to land and sea pollution. This has an adverse effect on the catch of the kelongs in various areas. Of course, we cannot criticise the-Government's reclamation schemes. However, we must consider the question of giving assistance to these kelongs so that the fishermen can carry on with their livelihood.

Mr Speaker, Sir, we know that in the last few years there were many cases of fishermen being robbed by pirates. Some of them were also arrested by foreign governments. Sometimes they were also kidnapped and were released only after the payment of a few thousand dollars. I am sure that our Government and all the people are sympathetic towards these fishermen for their hardship. I hope the Government will think of some adequate measures-to reduce, if not altogether eliminate, such incidents. For example, our Government can enter into an agreement with our neighbouring countries on the question of fishing rights so that our fishermen will be allowed to fish in their territorial waters without fear of being arrested, tortured or prosecuted. The Marine Police should also increase their vigilance and prevent plundering by sea pirates. I have also been informed that some of these pirates have even come to our kelongs to rob our fishermen. Mr Speaker, Sir, the personal safety of these fishermen must be protected.

The Minister for Finance knows better than I do of the contributions that agriculture and fisheries make to our economy. I only hope that he will spend some time considering in depth how to develop our agriculture and fisheries and I hope that in his next Budget speech he would devote more time to agriculture and fisheries. I am sure the 200,000 or 300,000 people of Singapore who depend on agriculture and fishing will be very grateful to him. I support the Budget presented by the Minister.

4.51 p.m.

Mr P. Govindaswamy (Anson): (In Tamil): Mr Speaker, Sir, I wish to thank the Minister for Finance for presenting his Budget and to say a few words.

The happy Budget announced on the 7th of this month in this House by our Finance Minister has caught nearly all Singaporeans by surprise, not only because there are no new taxes but there are simply no taxes at all. There are instead six tax reliefs which will benefit most of the people in one way or another. We can boast that we are one of the very few countries in the world which do not have to introduce new taxes but instead grant tax reliefs for the current financial year. This is one of the happiest moments in our nation's history. Let me -offer my heartiest congratulations to the Minister for Finance on his very illuminating Budget Statement.

In fact, Singapore's performance has contradicted the World Bank's predictions made a few years ago. Experts from the World Bank had then made a forecast that our country would face a recession and unemployment. However, the reverse has now happened. We have virtually full employment and the talk of recession has disappeared, with the boom condition continuing throughout last year.

However, I note from the Budget Statement that our port is being used less for entrepot trade. That may be a cause for concern, but I am sure the Port of Singapore Authority would by now have thought of alternative forms of raising income. I also notice that there is no mention of the containerisation of our port or of its facilities for which a great sum of money has already been spent. How much of this expenditure is worthy of producing an income for the port is a matter for conjecture. Do we have a sufficient number of ships coming here to make use of our container facilities?

Our national shipping line, the Neptune Orient Lines, has been rather shabbily treated by the Far East Freight Conference. When are we going to break the monopolistic and arbitrary control of our shipping by this foreign-based F. E. F. C.? We are an independent country and we should be able to trade with any country and with as many countries as possible. The F.E.F.C, should not dictate the terms of trade carried on by our national carriers.

Since China is giving us a helping hand to break the monopoly of the F.E.F.C., we should carry on more trade with her and with other countries which show a concern for our economic survival.

Our urban renewal programmes over the past few years have been going on at too fast a pace, and this has resulted in a shortage of workmen, and above all the shortage of cement. It seems that our cement factories are not producing enough to meet local requirements. There seems to be a good reason for opening another cement factory in view of further development that will take place in the years to come.

The Prime Minister recently announced the proposed payment of a non-pensionable annual allowance to all civil servants. This is a good idea and is welcomed by all. However, let me point out that those who deserve a further increase in wages are really those in the low income groups.

When the Wages Council make their recommendations for a minimum wage for our workers, we only hope that shopkeepers and hawkers will not have any excuse for profiteering. In the past, upon the slightest excuse the capitalist monopolists increased their prices unnecessarily. It is hoped that in this connection, the NTUC's Consumers' Association of Singapore will prove to be a more effective organisation than it is now.

Our per capita income has again been assessed as the second highest in Asia. This is largely due to the Finance Minister's wise calculations in the past, our Government's ceaseless drive towards industrialisation and, above all, to the success of our family planning programme.

In the past few years we have seen an enormous increase in the number of quality hotels. Unfortunately, for this same reason the occupancy rate is only 70 per cent and in some hotels it is even less than that. To help the rate go up, there should be more intensive tourist promotion efforts, and other means should also be explored so that many more tourists will be attracted to Singapore.

With these words, Sir, I thank the Minister for Finance for his Budget and express my deep appreciation and my congratulations to him.

Mr Speaker: Order. I propose to take the suspension now. I will take the Chair again at 5.30 p.m.

Sitting accordingly suspended at 4.59 p.m. until 5.30 p.m. Sitting resumed at 5.30 p.m.

[Mr Speaker in the Chair]

Debate resumed.

Mr Seah Mui Kok (Bukit Ho Swee): Mr Speaker, Sir, I would like to join my colleagues in this House to congratulate the Minister for Finance for presenting a painless Budget to Parliament on 7th March, 1972, for the financial year 1st April, 1972, to 31st March, 1973. I am sure most of the people in Singapore from workers to employers are happy that there are no new taxes. Not only are there no new taxes, but the Minister for Finance has kindly introduced six tax reliefs in his Budget Statement, which will give satisfaction to those who benefit.

With our present rate of economic and industrial growth, I sincerely hope that eventually workers will be exempted from paying income tax. I believe that income tax should be paid by employers, investors and industrialists only.

Mr Speaker, Sir, there is no doubt that the workers in Singapore have done their part in response to the Government's appeal for national survival and nation-building. Through their toil, sweat and sacrifice, they have helped to bring economic boom and industrial progress and prosperity to the Republic of Singapore. Although they stand to benefit in the present successful economic growth and industrial expansion, the employers, investors and industrialists benefit many times more than workers. To the workers, wages and bonus are always limited, but profit to the employers is unlimited. Whatever wage increases or bonus given to the workers will be taken back by the businessmen because the workers have to pay high prices for edible and non-edible commodities. Yet the employers are unwilling to give the workers any high cost-of-living allowance to meet the frequent increase of prices of goods. Businessmen can increase the prices of the goods anytime they like, but workers cannot ask for an increase in wages anytime they like. The workers must abide by the collective agreement. Where is the fairness?

Mr Speaker, Sir, I do appreciate that frequent wage increases will never stop the increase in prices of commodities and will cause inflation, but the Government must, at least, put a stop to unjustifiable increases in prices of commodities.

The workers are prepared to continue the tripartite co-operation and to maintain the present industrial peace. We give our assurance to the Government that we will maintain our present political and economic stability. We are willing to work harder to achieve greater economic and industrial growth for the Republic of Singapore for the benefit of all workers, employers and the Government. But please do not ask us to continue giving sacrifices all the time. The benefits most employers derive from the enforcement of the Employment Act and Industrial Relations Act of 1968 have been tremendous, especially on longer working hours, lesser number of public holidays, restriction of overtime work, limitation to the annual bonus to one month only, etc.

Mr Speaker, Sir, most employers have benefited from the toil, sweat and sacrifices of the workers since 1968 and they have already made substantial profits together with business expansion. Therefore, the time has come for them to share their profits sincerely with the workers by giving them bigger bonus, adjustment of wages and improvement in fringe benefits.

On 5th March, 1972, the Prime Minister announced at the N.T.U.C. Delegates Conference that the Government would pay its employees an allowance of an extra month's salary at the end of March, 1972, and would increase the C.P.F, contribution from 10 per cent to 12 per cent. He also said that the Government would review the salaries of the Government employees in Divisions I to IV, as well as the public daily-rated workers.

The workers in Singapore welcome the good news announced by the Government that the C.P.F. contribution for the workers in the private sector would also increase from 10 per cent to 12 per cent as from July, 1972, and it will be increased gradually to 15 per cent.

I hope all employers will follow the good example set by the Government. The workers are not demanding fantastic bonuses or wage adjustments. We only ask the employers to give a bonus if they make a profit.

It is a well known fact that annual bonus has been paid by Chinese employers as well as Western employers since pre-war days. When employers make profit they must pay bonus to the workers. The workers are the ones that help the employers to make profit in their business. Therefore, they must share their profit with the workers by paying them bonus. Mr Speaker, Sir, annual bonus is a necessity to the workers. Bonus is indeed very helpful to the workers especially to pay for their children's school textbooks, school uniforms, new clothing's for the new year celebration; to meet additional expenses on new year, such as food, drinks and ang-pows; to settle all the debts incurred and, if possible, to put something aside for saving. Bonus is a necessity to the workers especially the lower and middle income groups. I am sure all managerial and executive employees would like to get an annual increment of salary as well as bonus.

It is quite understandable that Government is not giving bonus to its employees but an additional extra month's salary as an allowance is just as good as a bonus. The Government employees really deserve this extra allowance.

Mr Speaker, Sir, the N.T.U.C, held its Ordinary Delegates Conference from 3rd to 5th March, 1972, and the Industrial Policy and Resolutions Committee's recommendation on the bonus payment was unanimously adopted by the Delegates as follows:

`The Committee agreed that the statutory limit of one month is unrealistic and is further of the opinion that there should be no blanket ban on the payment of bonus. Hence the Committee strongly recommends that bonus be made a negotiable item without any ceiling on the quantum of bonus.'

Sir, the restriction to only one month's salary as a bonus payment through negotiation was imposed by the Government under the Employment Act, 1968. With the present economic boom most employers are making very good profits, and I strongly appeal to the Government to allow the workers to negotiate bonus with their employers up to three months. If this proposal is agreed to by the Government, the N.T.U.C, will be prepared to accept it although we prefer that there should be no ceiling on the quantum of bonus.

Mr Speaker, Sir, the Minister for Finance in his Budget Statement in Parliament on 7th March, 1972, paid tribute to the workers for changing the difficulties and uncertainties caused by the loss of neighbouring markets upon separation from Malaysia and loss of unemployment and foreign exchange upon the British military rundown, into economic opportunities, o opportunities which have now produced our present healthy financial situation. Yet it is most regrettable that there are still some unscrupulous employers who are against the formation of trade unions to represent the workers and victimise the union organisers by dismissal.

Mr Speaker, Sir, the N.T.U.C, is forming a union for the managerial and executive employees. We are now drafting its constitution. The response from one oil company is very good. Out of its 25 managerial and executive employees covering secretary, superintendent, auditor, accountant, chemist, engineer, etc., 24 have already signed in support of forming a union. They have officially written to the N.T.U.C. Secretary for Organisation and Administration to join this union. I understand one of its management expatriate representatives had said hostile and anti-union remarks about their 24 managerial and executive employees for signing in support of forming a union. I hope the management representative of this oil company will appreciate that their managerial and executive employees have the right to join a union to protect their job security, better wages, bonus and conditions of service.

Sir, the petroleum workers' union, i.e., the United Workers of Petroleum Industry, is watching the development closely on this oil company, and we fully support its managerial and executive employees to join the union to be formed by the N.T.U.C. It was reported by the N.T.U.C. Secretary for Industrial Disputes that a good number of dismissals took place while the union was awaiting recognition, pending a ballot to be taken by members of the union. In fairness to the workers and to stop the tendency of employers to abuse the various prerogatives so conferred upon them, 1 request the Government to amend section 17 (2) of the Industrial Relations Act (Cap. 124 of 1970) and remove such prerogatives immediately.

However, the N.T.U.C is preparing a brief to the Government on alleged victimisation of workers by employers who are anti-union, and I hope the Government will not hesitate to use the big stick on them. I would suggest that employers who are hostile or against trade unionism, or victimise trade union organisers, should be packed into a box and despatched back to their own countries, and the sooner we do it the better it will be. I am glad the Prime Minister has stated that the Government would not allow workers to be bullied or coerced by employers.

Mr Speaker, Sir, under the amendments to the Industrial Relations Act, 1968, employers were given the power of hiring and firing, promotion, transfer and retrenchment. There are some unscrupulous employers using these managerial prerogatives to victimise workers as well as union organisers. It has been proven that these employers have abused their managerial prerogatives. Therefore, I request that these managerial prerogatives should be deleted from the Industrial Relations Act immediately. Mr Speaker, Sir, with regard to the existence of the Wages Council, of which N.T.U.C, is being represented by our President, Mr Phey Yew Kok, Mr Devan Nair, our Secretary-General and our Adviser, Prof. Tom H. Elliott, we have full confidence in them. I hope this Wages Council will be helpful to the workers and not be restrictive to the reasonable wage increase demand by the workers. I hope the Wages Council will see that the bonus payment system will not be abolished. Perhaps, I may say the workers have the right to demand bonus payment if the employers are making good profit.

Sir, I fully support the Government's policies as presented in the Budget Statement of the Minister for Finance.

5.45 p.m.

Mr Conceicao: Mr Speaker, Sir, a week has passed since the Minister for Finance delivered his Budget Statement, but the benign and cheerful effect of the Minister's words is still with us. The Budget has indicated correctly the relative well-being of our people, and holds out a happy expectation for the future, if we harbour our resources as prudently today and tomorrow as we did yesterday. The keynote of the Budget speech seems to be one of prudent confidence based on commendable achievement.

However, there is no warrant for complacence. We have to do better. One aspect to look at in our striving to improve is the question of labour productivity. The Minister has admitted that rapid industrial expansion has been wholly dependent on a growing labour input. For the future, however, there can be no industrial growth without productivity. Therefore, a vigorous programme for the up-grading of our manpower skills has to be embarked on energetically, to increase the average productivity of our workers. In this connection, I would like to urge also that more co-ordinated efforts be spent on making people more conscious of the necessity for quality in our products. I suggest that there will be a grave potential waste if proper attention is not given to developing a pride in workmanship, pride in contributing to a finished product of high quality. There seems to be a mistaken belief prevailing in certain quarters that quality is equated with, so to speak, Rolls Royce standards therefore appealing only to a few and hence possessing limited marketability. Nothing could be more disadvantageous to our industrial growth than this mistaken concept.

We have therefore to stress, with manufacturers and workers alike, a right view of quality which implies conformity to standards set in relation to reliability of performance. And the criterion of reliability has to be what is expected by the buyers of our goods. If we cannot fulfil market expectations of the standard of our goods-obviously good-bye markets.

So that, when the Minister talks of "new markets .., found for the products manufactured by local industries" and "increasing promotional efforts . being made to establish new markets overseas", I am sure he will remember that this will result not only from increasing management sophistication and greatly improved skills of workers but also from better quality of goods. I do not think that the last factor will, of necessity, and automatically, be an outcome of a combination of the first two factors. I do not think that simply because we have excellent management and skilful workers, our goods will automatically be of the best quality Steps must be taken to ensure that all three come together.

One of these steps is, of course, what the Minister himself has mentioned, namely, that there must be an equitable sharing of the fruits of greater efficiency (and this must include better quality). The difficulty is how to determine this; and the National Wages Council will have its work cut out to solve this problem. But the determination of incentives to workers to improve quality, as well as the assessment of rewards for higher productivity should be an urgent part of the task of the Council,

In the same way there is also the difficulty of determining in what way quality may be ensured through incentives to manufacturers. Generally, of course, there could be accelerated depreciation for capital investment in quality control equipment. I would like to imagine that the only reason why the Minister did not add this (seventh) tax relief item to the six tax relief items he listed, was the difficulty in distinguishing, for example, quality control equipment from production equipment. I hope that Government will not forget, however, its undertaking given in the addendum to the President's address at the last opening of Parliament in July, 1971. In the section of the addendum relating to the Ministry of Science and Technology, it was stated that consideration would be given to the possibility of providing tax relief for expenditure on equipment and technical manpower used for quality control also. At the same time if incentives are at all to be offered to employers to improve the sophistication of workers through training schemes, it should be hoped that incentives will also be offered for training in quality control.

From the Budget Statement it is clear that no avenue should be overlooked that will lead to assurance of higher productivity. This seems all the more urgent with the reference of the Minister for Finance to the continuing pressure on the balance of payments which he hopes will be relieved through our industrial growth as well as through "invisible" earnings.

Tourism is one important activity that results in such earnings. The Minister for Finance has stated that, with greater promotional efforts, the tourist industry may be expected to increase its earnings. I hope, however, that as much promotional pressure will be applied inside Singapore as outside it to boost tourism. By this, I refer to efforts to make the tourist appreciate Singapore as a city well worth visiting. Singapore's cleanness and greenness are features favourably commented upon by visitors. But the people with whom tourists normally come into contact should be encouraged to treat the tourist well and further give him a favourable impression of Singapore.

For example, one category of people tourists meet often is the taxi-driver. Some taxi-drivers have commented that previously foreign service-men stationed in Singapore represented a very good clientele. Now that these service-men are fewer in numbers, taxi-drivers should realise a potential new clientele that tourists could represent. Therefore, the minority of taxi-drivers who are disposed to take tourists for a ride at a higher fare than the standard rates should be shown that this is shortsighted. Tourists are pleased when they find that they can get from place to place without fear of being mulcted over fares. And, of course, the Tourist Promotion Board should encourage the acts of honesty we read about sometimes in the papers, when taxi men, for example, return valuables and money left in their vehicles, and when other forms of help are given, even at the risk of trouble to the taxi-drivers.

Another type of people tourists come in contact with are shopkeepers. Recently I overheard a tourist complaining that he was unable to get small change for a dollar note from any of a row of stores in a shopping complex. He had wanted to use a public telephones, but was unable to do so until another foreigner offered him a couple of shillings for this purpose. If this uncooperative attitude is characteristic of shopkeepers this will not do our tourist image much good.

Another hazard, for example, a visitor to Singapore faces, is the young voluntary worker selling flags for charity. Could these well-intentioned young people be advised to leave non-Singaporeans alone? One point worth noting may be the rather high hotel charges prevailing in Singapore. Earlier today we heard the Member for Potong Pasir raising the question as to how is it that occupancy rates are falling. One may make a shrewd guess that hotels with a high occupancy rate are those whose charges are tolerable. One point worth noting is that the low rate of occupancy may be due to the rather high hotel charges prevailing in Singapore. With greater ease of air travel, it is not the rich traveller who passes through Singapore as often as the couple or the person who has saved for an earnest look at a foreign land. And such are not those who necessarily want plush, chandeliered environs where the charges are commensurate with the princely setting. A tourist may be disposed to stay longer than the average of 3.9 days that the Finance Minister has referred to, if he were less deterred by high hotel rates. Could this deterrence be a significant reason, among others, why the average stay of visitors has risen only from 3.3 to 3.9 days in five years? Would the Tourist Promotion Board be doing reliable research on this and similar matters?

It is useful to note that the Tourist Promotion Board has set up a special conventions unit to encourage the holding of more conventions in Singapore. It would be just as useful to note that help might fruitfully be extended to humbler groups than connectionists, for example, students, educational groups from various countries. These serious-minded people come here to study our ways and our land and institutions. When they return to their own countries they play the role of willing ambassadors for Singapore, and in the long run help to make Singapore better known to their own people.

Incidentally, it would also be good for the Tourist Promotion Board to give help and encouragement to our cultural ambassadors like members of the recent successful cultural mission to Adelaide when they go abroad. And 1 would also imagine that it would be realised as a serious function of the Tourist Promotion Board to act as patrons of local art and artistic activity.

Finally, I would like to make brief comments on a few other matters the Finance Minister has referred to. I will keep to the order the Minister himself has observed. With regard to public housing, it is gratifying to note a higher growth rate in 1971. I hope that, with a reduction in the rate of hotel construction and construction of shopping complexes as well as of urban renewal projects, I hope public housing will show an even higher rate of growth, so that tens of thousands of people on the waiting list for Housing and Development Board flats will receive their allocations earlier.

With regard to the Mass Rapid Transit System, we were told that the feasibility study would begin this year. Anyway it will get underway soon. What I am concerned about is that we do not wait till the implementation of this system before we see orderly traffic on the roads. Something should be done soon especially through persuasion and education, initially, to make driving more characterised by consideration and courtesy and less by a kind of law of the asphalt jungle. This will help result in more safety for our children, pedestrians, motorists, and help reduce the appalling toll of road deaths and injury and monetary loss through traffic accidents.

On another point, the Minister has observed that our success will depend on the capacity of our people to improve themselves through education, training and experience. What the Minister means, of course, is that stress should be placed on continuing education, or adult education. If only the Minister had put it that way! Then encouragement would be given to those agencies making continuing education provisions, which should be always ready to orientate themselves to national objectives. With the bewildering rate of accretion of technical and technological know-how a painful characteristic of our modern world, every encouragement should be given to people to make them aware of the necessity for continuing education. At the same time because of the very emphasis, in modern circumstances, on science and technology, it is hoped that continuing education could also provide a much needed cultural or even liberal and gracious balance against too great a preoccupation with materialistic concerns.

On yet another matter reference has been made to the appointment of the Labour Adviser to the Ministry of Labour. The principle behind such appointment - the utilisation of available consultancy - is a sound and commendable one. Perhaps there could be one or two more of such appointments to other ministries.

Finally may I end on a sylvan note. I am glad that the Parks and Trees Division will be expanding its area of activity with the opening of new parks and wooded areas. The Parks and Trees Division has done a very good job in Singapore. However, apart from the added pleasure of these amenities, the Parks and Trees Division may now feel less disposed to rip up asphalt and pavement in order to plant trees and shrubs and thereby occasionally block the view of motorists as well as make the job of someone who wishes to take a walk along a pavement by the roadside a pretty adventurous one.

Sir, I beg to add to those commendatory remarks of other Members, my own humble commendation on the Minister's able statement on the Budget.

6.01 p.m.

Mr Lim Guan Hoo (Bukit Merah): (In Mandarin): Mr Speaker, Sir originally I thought of speaking in English, but in view of the fact that the Member for Whampoa has spoken in Mandarin, I would like to speak in Mandarin also.

Since independence, Singapore has, in the various annual financial budgets, made provisions to take care of its long-term economic development interests. She has never resorted to increase taxation suddenly in order to get revenue quickly, as this would lead to the inevitable result of "killing the goose that Jays the golden egg". Among certain Eastern economic theories of long standing, there is one that says "when wealth is gathered, the people will scatter, and when wealth is scattered, the people will gather". Now this is only directed at the corrupted economic system, and Singapore has nothing to do with this type of decadent and corrupted economic system. Of course, we also pay attention to the accumulation of national wealth, but this should not be done at the expense of the interests of the people. The reason why our national coffers can increase their intakes is because of the diligent efforts put in by our people. Under these conditions of increased productivity, our national G.N.P, has reached a high peak, bringing about greater wealth and better living conditions, to be shared by more people who have participated in the economic production. Thus the interests of the people have not declined. On the other hand, the average individual's income has been raised. This is one of the main reasons for Singapore's general prosperity. The more decisive fact is that we have, through industrial development and other efforts at economic promotion, overcome the serious unemployment situation that existed before 1959 when the People's Action Party came to power.

Today, Singapore has reached a stage of full employment. This is an undeniable fact. Full employment is what socialists think of as an ideal attainment in economic development. A few decades ago some British socialists in their "Reconstruction Manifesto" had listed one of their important ideals and objectives as full employment. In their declared manifesto, "The Four Pillars of the House of Tomorrow" one of the pillars related to the ideal of full employment. Very few people could have expected that the good things of "tomorrow" in the dreams and ideals of those socialists could now become a reality in our little island.

With regard to taxation, of course, any Finance Minister who does not declare or envisage any new taxes will be a popular Minister. However, much as we want to be free from any taxation or to enjoy tax reliefs we cannot always put this into effect. A nation is just like an individual. There are times when we need to call upon every individual to contribute his part in the form of taxes, and this should receive the response of all conscientious people. In spite of this, we will still be glad to see our industrious people enjoying and sharing the fruits of our economic progress. The good news that there will be no new taxes and further tax reliefs are given, reflects our general economic prosperity, and we can all the more realise that on this occasion, our personal interest matches with our national interest. They are not always incompatible with each other. But when the national interest is taken care of, then individual interest will be better safeguarded. This cannot be denied.

In the Budget speech, one important point worth noting is the adjustment of the salary scheme of the Civil Service. The Civil Service is an important link in a democratic system. When a party forms the government, its policies will have to be implemented by the Civil Service. This processing machinery should, therefore, be reliable and there must be a sense of integrity. In the past a few civil servants created a bad impression of the Civil Service. However, to speak the truth, we have now many capable and good civil servants, all of whom we can be proud of. Our Minister for Finance was one of them. Judging them from any angle, whether it be efficiency or integrity, our Civil Service can be said to be the best in this region. That our democratic socialist principles can be put into effect and that our economic growth has been speeded up, we owe all this to the Civil Service. They have played an important role; they are an important factor in the whole process.

In the past few years, the Government had been able to re-adjust our economy by various means so that the private sector has benefited a lot. However, the private sector has become a good green pasture in the eyes of civil servants. Thus if the Government does not adjust their salary scales so as to reduce the discrepancy in wages between the public and private sectors, then more civil servants will resign to join the private sector. Although this will not shake the foundation of our Civil Service, it is necessary for the Government to bring the salary scales of the Civil Service more equitable with those of the private sector. Then this will make working conditions in the Civil Service more attractive. This will also be conducive to the principles of democracy. Of course, 1 do not wish to relate the good traditions of incorruptibility of the Government service to the readjustment of the salary scales. Although the one month's salary as an annual allowance may not be any reflection on the integrity of the Civil Service, even if an allowance of less than one month's salary would not at all affect their integrity. However, a rational salary system will be conducive to the good traditions of the Civil Service. The reputation of our Civil Service as one of integrity and honesty is a national asset. We should try to safeguard and preserve this. If conducive measures are necessary to safeguard this asset, then we must not neglect them.

Now, some Government departments are undergoing a reshuffle of personnel and changes to the administration as a whole with a view to introducing computerisation and modernisation. All these are meant to raise the efficiency of the Government administrative machinery.

Reading between the lines of the Finance Minister's Budget speech, we can see the reflection of the upward trend and the mood of the people in their effort to march forward in the path of nation building. I cannot help giving my full support for the Minister for Finance's financial policy.

6.12 p.m.

Mr Ho See Beng (Bras Basah): Mr Speaker, Sir, when Finance Ministers present surplus budgets to Parliaments, Members need not necessarily offer bouquets to them since in modern welfare states surplus budgets are considered more as a pedantic luxury which developing nations cannot afford. But in the case of a nation like Singapore while maintaining the high tempo of development activities with a 14 per cent increase in Gross National Product, thus raising the per capita income from $2,960 to $3,317 in 1971, together with a surplus budget, we cannot help expressing our appreciation of the Finance Minister as well as those who assisted him in this task. While simultaneously stressing the need to maintain the same high standard, we should not hesitate to adopt a constructive and critical outlook in this Budget debate so that the upward trend is not deflected by unforeseen errors, even of an insignificant nature. Hence, the Government's financial policy statement and the Estimates of Expenditure for the year 1972-73 presented to the House should be viewed in this perspective.

May I, at the outset, state in categorical terms based on my personal experience in this House, that I would not hesitate to appreciate the basic approach of our Finance Minister who has exhibited in the past a readiness to listen to criticisms from all sections of this House, and many suggestions which can be implemented were accepted without any reservations.

Mr Speaker, Sir, no one will dispute the fact that the economic and political problems which confronted the Republic during the past few years have to form the backdrop before we are in a position to view the economic achievement in any perspective. As against neX1igib1e natural resources, substantial reduction in British military expenditure, the necessity to explore new and highly competitive international markets, the turbulent political situation around with extra demand on our defence, and a young and restive population demanding new horizons in development planning and employment along with a highly volatile international monetary situation, it is rather a pleasant surprise that our G.N.P, rose by $860.8 million to reach $7,000.8 million- an increase of 14 per cent- within a period of twelve months.

The Finance Minister would prefer to call it a non-inflationary growth since, according to him, the general price level has not increased appreciably. However, the latest issues of the Monthly Digest of Statistics' for January and February 1972 do not appear attractive with regard to consumer prices. There appeared to be an overall increase of approximately three to four per cent. But in the general context of an overall growth as related to the general price level, I do agree that there has not been an appreciable increase. Nevertheless, it is not out of place to suggest that constant vigilance has to be kept with regard to price levels so that the growth is not retarded by inflationary pressure.

As stated by the Finance Minister, the structural transformation of the economy from an entrepot trade to an industrial society appears to be moving at a desirable pace. It is rather sheer necessity. prevailing opportunity, long-term requirements, along with the spirit of entrepreneurship which have accelerated this process. I observe from the figures that over the decade the share of the manufacturing sector, as related to the Gross Domestic Product, has increased from 11.2 per cent to 28.5 per cent, while that of the trade sector has dropped from 70.7 per cent to 55.5 per cent.

The manufacturing sector alone has made substantial progress over the decade. The sudden spurt appears to have taken place during the last three to four years from $716 million in 1968 to $1,490.9 million in 1971. The entrepot and domestic trades together are maintaining an average growth rate of approximately 14 to 16 per cent during 1966-71 while there appears to be a marked drop, that is, 9.6 per cent in growth rate during 1971.

The Minister has maintained that domestic trade fared better and that it was entrepot which has, due to logical circumstances, declined. Here, progressively direct trade link improvements maintained by our neighbours had a negative impact on the entrepot sector. Leaving alone their changing role in trade patterns, even our approach during the last few years has been to promote a structural transformation and, therefore, not to continue to serve as out-posts of a decadent economy which used to he subjected in the past to violent fluctuations, depending on the rise and fall in rubber and tin prices in the international markets. Hence, I might say that it augurs well that a modest rise in domestic trade and overall accelerated progress in manufacturing and construction sectors will go a long way in assisting us in attaining the desirable objective of full-employment with one of the highest per capita income in Asia.

Apart from that, may I also add that those employed in the entrepot sector could be eventually absorbed into the growing domestic trade sector with minimum dislocation. From that point of view also expanding domestic trade sector is a healthy sign.

Further, Mr Speaker, Sir, it appears from information furnished to this House that the manufacturing sector has registered the fastest growth rate, and we cannot rule out the significant role played by the electronics industry. Incidentally I might say that this industry, which employs a very high percentage of labour force at competitive wage rates, is expanding its export markets substantially. At the moment there is a ban on the exports of strategic goods to Communist countries by the United States and if the prevailing political climate improves for the better between East and West, the further possibility of substantial increase in exports of electronic goods can be expected in the near future with Singapore too sharing a part of that boom in terms of additional employment and additional positive points to our balance of payments.

In making a reference to the manufacturing sector, the Minister has stated in general terms about the prospects of multi-national manufacturing concerns. It is perfectly true that we cannot expect a complete diversification with regard to the establishment of foreign-owned industries in terms of nationality of the industrialists since only matured economies with a high level of technology and expertise can cope with our requirements for industrial expansion and sophisticated international markets for finished products. Nevertheless, it has to be understood if our industries and manufacturing concerns are oriented in one or two foreign countries, then stress and strain in the parent economy might be transposed to a limited extent to our domestic economy. Leaving economics alone even from political angle. "cornering of economy" by one or two countries might eventually lead to undesirable pressures when we are facing an economic turbulence. Hence, I might say that diversification of industries on a nationality basis should be considered as a healthy sign.

While analysing the manufacturing and construction sectors, we cannot afford to overlook the fact that of late both shipbuilding and ship repairing have made substantial strides. But the shortage of skilled manpower continues to be a serious threat to accelerated expansion and although inviting foreign nationals might be considered as a temporary measure. I might say that we have to expedite with our programmes relating to training within industry along with overseas training with the parent concern. The shortage of labour, if I am not mistaken, appears to have created the twin problems, namely, on the one hand it has pushed up to an appreciable level the wage rates with sophisticated pinching among the different groups and, on the other hand, it has created minor bottlenecks in the expansion programme. Nevertheless, with all these drawbacks, it is rather interesting to note that the shipbuilding yards have continued to receive a stream of orders for tankers as far away as the Continent while the repairing yards appear to be fully booked for a longer period. Incidentally may I add, Mr Speaker, Sir, that we must continue to assure our workers employed in this sector and who contribute to our valuable foreign exchange that the Labour Ministry will continue to enforce maximum industrial safety so that the price paid for rapid industrialisation will not be that heavy in terms of human sacrifice.

Mr Speaker, Sir, the Minister has also referred to trade deficits by the high cost of import of goods. I wonder whether the devaluation of the U.S, dollar would, in fact, keep prices down while, at the same time, pegging down the cost of production of those goods which require raw materials from the United States, especially in the case of the electronics industry.

If the Minister is thinking in terms of invisible items, like tourism and insurance, to jack up the balance of trade accounts favourably, then he should have definitely noticed that tourism has increased its share of the Gross Domestic Product from $30.5 million in 1960 to $323 million in 1971. It is indeed a general indication that earnings from invisibles have increased substantially.

The Minister has also stated that invisible items like ship repairing might also bring in more on the credit side. I might also add that freight insurance and building a nucleus of merchant fleet to transport our goods as well as the cargo of other countries across the seas might add up to the invisible items in the balance of payments accounts in terms of transportation charges. It is a long-term approach. There is no necessity to overstress this aspect of the problem since the Government is aware of the heated debate in domestic shipping circles over the alleged monopoly of some members of Far East Freight Conference who periodically appeared to be increasing their freight charges apart from creating problems relating to rights of cargo handling by national shipping lines.

The question of tourism and its contribution to our foreign exchange earnings have received sufficient attention in the Budget. But I also notice that with regard to the hotel industry, the occupancy rate has fallen from 73.5 per cent in 1969 to 65.4 per cent in 1971. The expansion of hotels may have been one of the reasons for this decline. Nevertheless, I am afraid I cannot rule out the possibility that sharp increases in accommodation charges and prohibitive prices of other facilities to the tourists, including food and beverages, with additional taxes over and above the exorbitant prices, might have had a negative impact on the inflow of tourists especially in the middle and lower income brackets. I might add that while providing first-class amenities comparable to New York and Tokyo might be a desirable objective, it would simultaneously be equally desirable to keep the hotel industry under constant check, at least as a temporary measure, so that tourism can catch up at a faster pace. It is not out of place to refer to the spate of criticism in the press, including one from a Hong Kong businessman, that even a mild breakfast with coffee in one of the first-class hotels in Singapore cost him a substantial amount.

Further, I would also like to stale that a congenial political climate both internally and in the surrounding regions is essential for economic advancement notwithstanding all other pre-requisites. Here too the domestic situation is comparatively calm with a stable Government on the saddle. On the labour front too, although a strike here and there might be considered as flexing a muscle, by and large, workers have responded enthusiastically by maintaining industrial peace. But it need not necessarily mean that we should hold on for a longer period with regard to the division of the "National Cake".

In this connection. I welcome the setting up of the National Wages Council with tripartite representation which will provide assistance in the formulation of general guidelines on wage policy, and recommend necessary adjustments in wage structure with a view to developing a coherent wage system consistent with a long-term economic development.

Finally, Mr Speaker, Sir, let me express the hope that the Finance Minister, who has not held this portfolio for a long period, has acquitted himself creditably, and I hope he will be in the same Ministry to present us next year with another painless Budget which will continue to reflect his ability to take the nation along the highway towards economic progress.

6.30 p.m.

Mr Sim Boon Woo (Changi): Mr Speaker, Sir, I rise to join my colleagues in congratulating the Minister for Finance for presenting a painless Budget. Hence I fully endorse my support to the motion moved by him on 7th March, 1972.

However, Sir, I do not wish to repeat the observations made by my colleagues nor have I the brilliance or intelligence to do an analytical dissertation on the well presented financial statement, for much ground has already been covered by Members of the House. Therefore, I will confine myself to one small observation, i.e., the involvement of public moneys by Government through the Economic Development Board in what I call "adventurous projects".

Sir, the Minister for Finance must be the most elated man in town. The success of our Government's economic and industrial policies deserve not only mere words of praise but also a deeper search into the causes and factors which helped to put our economy beyond the stage of the launching pad. Only cynics and pessimists will raise doubts as to the present economic buoyancy of the Republic.

Whilst I cannot hesitate to commend the Economic Development Board for its achievements in attracting foreign investment into the Republic, I am a little sceptical as to whether the Board has all the information and, even more important, the expertise to ensure the soundness of every investment. I would like to know what are the factors that guide the Board before it decides to participate in some industrial ventures. I agree that direct capital involvement by the Government would lend great credibility to any project. I have no doubt that many detailed feasibility studies must have been made to ascertain the viability of each project. Unfortunately, Sir, these feasibility studies have in some cases turned out to he nothing more than speculation. One can no longer take for granted that the Economic Development Board has the capacity, in terms of personnel, to justify its involvement in joint projects with either foreign or local investors. Of course, one cannot summarily dismiss the achievements of the Board. But I believe the Government can save itself from considerable embarrassment and pain if more meticulous studies are made before Government invests public money in adventurous projects.

Sir, the situation is further aggravated by the nomination of Government representatives to serve on the board of directors of certain companies. These representatives, their brilliance in other fields notwithstanding, may know next to nothing in that particular undertaking. Sir, some Economic Development Board officials do not appear to know the real value of money. I hear many a potential foreign investor smacking his lips when he negotiates terms with E.D.B, officials - like an agile cat ready to pounce upon and devour a canary. I would earnestly urge the Minister to strengthen the staff of the E.D.B, before more harm befalls us.

6.35 p.m.

Mr Hwang Soo Jin (Jalan Kayu): Mr Speaker, Sir, it is customary on Budget day for the Minister for Finance to review the nation's economic performance. We have been assured that we have done well and the common indicator of economic progress, the G.N.P., has registered a 14 per cent increase which, by any standard, is an impressive one.

However, Sir, to the average man in the street, this means very little. What lie is basically interested is whether he is enjoying a better standard of living today than a year ago and whether his take-home pay today can buy him the same, if not greater, quantity of goods and services.

As a Government, I feel that in reviewing the national economic progress, we should not be obsessed by plus or minus in percentages alone. Sir, we should attempt to look behind the figures and see whether we are a step nearer our objective of bringing about a more just and equal society. Have we succeeded in further bridging the gap between the haves and the have-nots? Have we succeeded in improving our physical environment by providing a greener, cleaner and safer place to work and to play? Have we succeeded in providing better and equal opportunities for education and for employment? These are some of the pertinent questions the average man in the street will ask in deciding whether, as a Government, we have effectively carried out what we set out to do. Unless we are able, as we have done so far, to continue to give satisfactory answers not only in words but in deeds to each of these questions, we shall lose the confidence and the trust of the people and whatever impressive statistics are shown will be meaningless.

Sir, this time last year the question of cost of living featured predominantly in our Budget debates. A number of us had urged in this House that an up-to-date index of cost of living should be introduced so as to provide a rather more accurate means to measure any ups and downs in our cost of living. It is, therefore, a matter of regret that no action has as yet been taken to-date. Sir, I would like to take the opportunity to urge the Minister to give priority to this particular matter so that in subsequent years we will be able to assess more accurately whether our workers have generally benefited substantially from the greater economic growth, or whether they are caught in a wage and price spiral.

In this connection, the setting up of the National Wages Council with tripartite representation from labour, employers and the Government is to be welcomed. And it is pleasing to note that among other things, the determination of equitable shares will henceforth be the concern of the Council. It is to be hoped, however, that the recommendations of the Wages Council will have the whole-hearted support of enlightened employers on the one hand and responsible union leaders on the other.

Sir, as a representative from a constituency which still has a very large number of people depending on agriculture for their livelihood, 1 share the disappointment of the Member for Jurong over the absence of any reference to the agricultural sector by the Minister in his speech. In the supporting statistics, it is shown that agriculture and fishing have contributed a sum of $188.3 million to our total Gross Domestic Product as against that of $171.2 million for the preceding year, an increase of 4.3 per cent. Whilst the increase is only marginal and insignificant, when compared to that of 25.1 per cent for manufacturing and quarrying and that of 22.3 per cent for construction, the total sum of $188.3 million is nevertheless a very substantial amount when we consider that the contribution of the "glamour-service" industries of banking and insurance amounted to only $112.6 million.

Whilst I appreciate that with the tremendous pace of industrial expansion and extensive urban renewal the pressure upon our limited land resources is increasing day by day, it is unrealistic and impractical to talk in terms of a comprehensive policy of agricultural development in the context of Singapore. It is, however, in my opinion not impractical to consider bringing about some degree of stability to this particular sector of our economy.

Over the past few years most of our farming families have lived in a state of uncertainty, uncertainty over price fluctuations of farm produce and uncertainty over the likelihood of resettlement. In so far as price fluctuations is concerned, as long as there is no price control, it is to be expected that the level of prices will be dictated by supply and demand patterns. But what concerns me is that whilst retail prices have remained fairly stable over the years according to available statistics, the ex-farm prices, i.e, the prices received by farmers from middlemen, vary quite considerably over any one period of 12 months and often bear no relationship to the retail prices paid by ultimate consumers. This is one area where some research should perhaps be conducted so as to determine whether certain measures can be taken with a view to providing facilities that will enable farmers to have rather more direct excess to consumers with resultant lesser dependence on the middlemen.

Sir, on the question of resettlement, here again I appreciate that this only takes place when a particular piece of land is urgently required for development. What I am wondering is whether, at this juncture, it is possible for us to designate certain areas in the Republic as agricultural areas on a fairly permanent basis. And as and when farmers are affected by development, they are resettled in such permanent areas without fear of being resettled once again by subsequent development projects. This will go a long way towards giving greater peace of mind to farmers and will also help in more comprehensive planning of infrastructure development in the designated areas concerned, As we become more urbanised and industrialised, there is bound to be a minority of people who will find the pace of life too much for them and will prefer something resembling a pastoral way of life. I do sincerely hope that there will still be a place for such people in our society to live a way of life they prefer and, at the same time, to contribute economically.

Finally, Sir, in supporting the motion, I would like to thank the Minister for increasing the vote in respect of urban and rural services under the Development Estimates to $3.25 million for the ensuing period. This increase will mean that more roads and other facilities can be provided to people living in the rural areas.

6.45 p.m.

Mr Low Guan Onn (River Valley): Mr Speaker, Sir, I rise to support the financial policy statement made by the Minister for Finance in this House a week ago.

There should be greater emphasis placed on research and the building up of indigenous technological capability, not only related to hardware engineering and consultancy services but also, to further end-uses of the raw materials which are found in great abundance in the countries bordering us.

Since 1968, soon after the British announced their accelerated military withdrawal from our Republic, every effort and inducement was made by the Government to promote and attract industries. They were labour-intensive industries with primary and secondary level skill content to meet our unemployment problems. Today it is a different picture. We have full employment. Traditionally, Singapore has been thriving for the last 150 years on its entrepot trade with the additional function of a transhipment and servicing centre. But this important sector of the economy is growing less significant.

With the growing number of school-leavers coming out each year, our Government has to diversify from the traditional commercial and servicing role to manufacturing, in order to absorb these young men and women. Therefore, for a start, we have to establish labour-intensive industries. We have been so successful in the promotion of our industrialisation programme that we are now placed in a position which has compelled us to relax our immigration laws by opening the employment gate to foreign labour to meet the shortage of industrial labour. But, unfortunately, this state of affairs cannot carry on indefinitely. We may reach an unmanageable situation if the number of foreign workers keeps on increasing. This may wreck the fabric of our social order, which our Government has taken so much planning, effort, and energy to build up during the last six years.

In view of the above circumstances, it is vital and essential that we must give careful thought to which direction our next step will be, and in what kinds of industry we should concentrate on. We have limited manpower, but we have intelligent, educated, disciplined and adaptable workers. If we look around the countries in Asia, we can emulate the second greatest industrial nation in the world ----- Japan. She has no iron ore, bauxite, coal or oil, and yet today she is the greatest shipbuilding and car manufacturing nation in the world, owing to the industry and resourcefulness of her people who are, at the same time, creators and innovators of science and technology. Therefore, on a smaller scale, our Republic can follow the excellent example of Japan.

Japan gets her iron ore from Australia and oil from the Middle East, and these sources of raw materials are thousands of miles away from her home country. We are more fortunately placed, as we are right in the centre of one of the richest regions in the world waiting to be developed.

Indonesia and Malaysia produce rubber, tin, timber, and many other natural resources, which are raw materials for manufactured goods like rubber tyres, shoes, waterproof raincoats, plywood, veneer, etc. Indonesia, which is less than 30 miles away from us, is now one of the top five oil producing countries in the world. She is also rich in minerals. Therefore, all these countries are potential manufacturers of goods which are now being imported. Our neighbours send their raw materials to industrial nations, like Japan and the E.E.C, countries which manufacture them into finished goods, and imported back to their own countries.

Our country, being so strategically placed, can play an important role as innovators and creators for new industries for these neighbouring countries in the region, if our engineers, scientists and technicians will devote their time and energy in doing research into the uses of these raw materials. After successfully getting the know-how and expertise of turning them into new useful products, we can pass on our knowledge to our neighbours and establish industries right on the spot where the raw materials are obtained, thus cutting down the cost of freight, handling charges, insurance, etc. In this way, by co-operation in our skilled manpower, expertise and finance, and establishing cross-national ventures with our neighbouring countries, the concept of regional co-operation would soon become a fact. At the same time, it will create trust and establish a better friendly relationship between all the countries in the region for their collective and mutual benefit.

Mr Speaker, Sir, I will now come to another subject. The Member for Bukit Ho Swee has been very articulate about the high cost of living and the restraint on workers' wages because of the Employment Act. As an employer, I am in full sympathy with the workers.

Some measures must be seriously considered by the Government to improve the earnings of workers without creating an inflationary trend. The establishment of the National Wages Council is most timely, and 1 hope that some remedial measures may result from the deliberations of the Council. At the same time, it must also be borne in mind that without stability in wage rates and a disciplined labour force, foreign investors will think twice before coming to our shores. On the other hand, the minor boom prevailing in all sectors of the economy have been largely due to the efforts and cooperation of our hard-working and disciplined workers and responsible trade unions. To prevent an inflationary trend, any spiralling increase in wages due to union demands will create a situation where productivity will not in the long run catch up with the increase in wage rates. It will be a vicious circle and will affect the workers most, due to the high cost of living caused by inflation.

As pointed out by the Member for Bukit Ho Swee, the Prime Minister has recently announced the granting of one month's extra pay to all Government servants. The private sector should respond to the clarion call of the Prime Minister. I have a proposal to make, and that is to give a high cost of living allowance equivalent to 10 per cent of the basic pay to all workers drawing less than a total remuneration of $750 per month. The workers in this wage bracket form the majority of our working population, and they are affected most by the rising cost of living.

Sir, I hope that Members who are concerned with trade unions will sound a word of caution to all workers to be patient, and to play their part in the long-term interest of the nation. I am sure that with their understanding and co-operation, the Republic will reach greater heights of prosperity in the l970s, which in turn will mean a higher standard of living for everyone.

Mr Speaker, Sir, on that note, I beg to support the financial policy of the Finance Minister.

6.55 p.m.

The Minister for Finance (Mr Hon Sui Sen): Mr Speaker, Sir, I am grateful to Members for the many congratulatory and approving remarks of Members on the financial policy which I dealt with in my policy statement. As the Minister in charge of financial policy, it was my privilege and good fortune to be able to present an annual Budget Statement which was entirely painless, and therefore received the approval of so many Members.

But I hasten to disclaim any credit solely for this result, it is quite obviously impossible for any one man, except as a member of a team, to have achieved this result, which has been the product of a sustained effort over many years by people from the top leadership of the Government to the Members of Parliament, to the party and, above all, as I said in my annual Budget Statement, to the workers of all classes and occupations. Apart from these remarks, I would like to say how much I appreciate the many suggestions and constructive criticisms I have heard today. They are most valuable and I propose to give very careful consideration when I have the time to study them in Hansard. I say so, because many speeches were made, some for the first time in a new language, and there may be some loss in interpretation. Therefore, if I deal with these remarks in a way which shows some lack of comprehension, I ask to be excused. The remarks, of course, vary very considerably. For example, the Member for Serangoon Gardens remarked that he obviously thought that my Budget Statement suited the residents of Serangoon Gardens very well because of the tax reliefs. On the other hand, my Budget Statement was perhaps not quite as welcomed by the Member for Jurong, whose problems are farmers, and agriculture, and fisheries, and also by other Members concerned with adult education. And there were also views with a mixture of both good and bad.

I have heard a number of suggestions for further tax reliefs, but while I am prepared to consider them for further painless budgets. I think I should say right now that it will be quite impossible to exempt all workers from taxation measures; if the definition of "workers" ranges from those who are now already exempted from tax to those who, as in my definition of workers in all classes and occupations, are not only just manual workers but also those who use their brains. There were some suggestions for reliefs for maintenance of parents, and others for expenditure on quality-control equipment. On the latter, there is already a provision in the law whereby accelerated depreciation can be allowed for approved equipment, particularly for research and development and methods related to science and technology.

There is also the suggestion from the Member for Telok Blangah regarding relief to poor people who use electric fans, and are thereby charged at a high rate of electricity for lighting as against cheap domestic power. I believe this matter will be resolved by the Public Utilities Board when they adopt a new tariff system in which the supply of both power and lighting will be calibrated by the same meter. Consumers will then have to pay the same rate for both electricity and power.

An hon. Member: Will it cost more or less?

Mr Hon Sui Sen: From what I have gathered, it will cost the small consumer slightly less. But this matter is still under examination because of its effect upon industry. Nevertheless, I believe a decision will be taken fairly soon.

I would like to deal with some of the other comments under various subject heads. First of all, I welcome the exhortations which many Members have made regarding the necessity for hard work. I thank the Members for Telok Blangah, Serangoon Gardens, Sembawang, and River Valley among others for bringing this to the attention of workers in all classes and occupations. The comments on workers were made under the various subject heads like the National Wages Council. I think quite a number of Members touched on this. The Member for Moulmein stated that I had not stressed the importance of this Council in my Budget Statement. However, I thought I had mentioned that this was one of the strategic objectives for the next 10-year Development Plan. It is one of the two or three most important objectives, and I have placed great emphasis on the importance of the National Wages Council, and the deliberations which they are going to make over the next few months. But their first recommendations are important because they will set the tone for the whole Council. I have no doubt that they will pay attention to what all the Members have said in this House and will certainly consider the four main points which the Member for Moulmein has brought up.

As for the Member for Bukit Ho Swee, I have no doubt that the Wages Council will consider his views in greater detail. The views on bonuses, fringe benefits, and so on, are, really a matter for the Wages Council, and I do not want to anticipate what their recommendations will be by saying anything here today.

There was some mention of closing the income gap between the haves and the have-nots. I do not know whether this classification is meaningful in the context of Singapore, where there is great mobility so that the present-day have-nots very soon get into the position where they become the haves. Therefore, what we all want is a more egalitarian society. At the same time, it is necessary to stress that rewards should go to those who make the effort and not to those who merely think that just because all men are equal, they should also have a share of the reward. The principle is that there should be equal rewards for equal effort.

A great number of Members welcome the annual allowance, or the 13th payment, which has been introduced by Government, I have no doubt this will be taken as a guide for the private sector and will to some extent determine the attitudes to be taken as to whether or not bonus should be payable. On the Government side, it is felt that this 13th payment is necessary in order that some extra funds will be available for the festive seasons, like Christmas and the New Year. Therefore, this lump sum payment is very welcome. Whatever the decision is as to whether or not bonuses should be paid, I think this 13th payment is likely to be welcomed by all parties.

On the Wages Council, I need only say that what we want to achieve is an orderly and progressive increase in workers' remuneration, in the interest of all parties concerned. The need for industrial peace is not less important because of evident economic development; rather, we must expect all to try their hardest to progress further and to achieve the same growth rate for the next 10 years. I hope the Member for Bukit Ho Swee will not disagree with me if I say that the tripartite partnership between Government, management and labour, is really what we want to achieve. It is not a confrontation we want between labour and management, with Government as a referee, in the Wages Council.

There were a number of suggestions on industrial safety, productivity and the introduction of quality control, in order that workers can improve on the quality of their products thereby obtaining a share of the greater profits derived from a better sale of these products, I am sure all Members will support the suggestions which have been made.

A broad range of remarks was related to the social adjustments which are likely to be necessary in this period of rapid economic growth that is expected for this decade. I welcome the comments made on the need to make wage adjustments so that we have a more egalitarian society. I also welcome the remarks on the improvement in the quality of life as we go up the economic scale. I do not necessarily subscribe to the idea suggested by one Member that the economic progress that we are likely to achieve will bring with it the degenerative and corrosive aspects we see in the West. These are not necessarily the by-products of affluence. If we have regard for the cultural and traditional values of the East, I have no doubt that we can, by special efforts -- and no doubt the guiding efforts too of my colleagues, the Ministers for Home Affairs and Culture prevent a decay setting in our society, such as has been experienced in some countries in the West.

There was also the suggestion by the Member for Kampong Kapor that we should try and get more of our women to work in industry and trade. I think this is an excellent suggestion. The percentage of our women in our present work-force is rather low as compared with some of the industrially advanced countries. The present shortage of labour can be very quickly and easily met if we can increase the number of our women who are prepared to work for a living. This, of course, brings with it the attendant problem of providing cr�ches where children can be taken care of while their mothers go to work.

I will now deal with another topic which is apparent in many comments, i.e., the problem of price increases, which the Members for Moulmein, Potong Pasir, Jurong, Anson, Jalan Kayu, and a few others dwelt upon. With regard to the necessity of keeping prices down, I should like to say that this question is always uppermost in our minds. I welcome the NTUC's initiatives which resulted in the setting up of CASE, and their consideration of forming a Consumers' Co-operative. There seems to be a misconception on the part of the Member for Jalan Kayu that nothing has been done to-date about producing a cost of living index, which will be considered more satisfactory than the present index. The position is that we have started a household expenditure survey, and an index will be ready in course of time. This is because the survey requires fairly detailed book-keeping by housewives who are invited to help, and it is hoped to be completed by the time the next Budget Statement is made in this House. In the meantime, we will, do whatever we can to try and stabilise the cost of living. However, it is not always possible to keep prices down. If we take the international price of sugar as an example, our housewives will have to pay perhaps a price very much higher than the controlled price which we have imposed on our local sugar refineries.

Another series of remarks were related to immigration problems. The relaxation of immigration laws brings with it certain problems. We should realise that if we allow unmarried workers to immigrate into Singapore, there is bound to be some social tension. But these problems will have to be dealt with as they arise. There are also difficulties in deciding who are to be allowed in, e.g., whether the foreign musicians are on aesthetic grounds better or only as good as those we have locally. This is very much a matter of taste. I do not claim to be capable of judging the respective merits of those musicians who make such a lot of noise in our night spots! if the criterion is merely how loud you can play, then it is subject to scientific determination. However, I am reliably told that other values are involved. I would suggest that if our local musicians are really better than foreign ones who are now allowed to come in large numbers, then it should soon be evident to all those who are in the business that in the end the foreign musicians will, because of the high cost of importation, have to lose their places to our local boys.

Now, there were some remarks on the various Ministries. I do not claim to be able to answer for all of them, hut perhaps I can start by commenting on the remarks made on matters within my Ministry. A number of Members have touched on tourism in their speeches. I am grateful to them for their suggestions for its improvement. I am sure the Tourist Promotion Board will take note of the exhortations made by the various Members in regard to the Board's effort.

There were a few remarks which. I think, were not perhaps quite justified. One was the question of taxi drivers raised by the Member for Katong. I think he spoke of taxi drivers mulcting their fares.

Mr Conceicao: On a point of clarification, Sir.

Mr Hon Sui Sen resumed his seat.

Mr Conceicao: Sir, I qualified it by saying "a minority of them".

Mr Hon Sui Sen: In fact, I was going to defend them by mentioning the reports in the Press about taxi drivers who had been very honest.

Mr Sim Boon Woo: Hear, hear!

Mr Hon Sui Sen: There are more taxi drivers who are a credit to Singapore than those who are not.

Mr Conceicao: I mentioned that too.

Mr Hon Sui Sen: You did? Thank you. There was some mention about hotel rates being high. I am afraid I do not quite follow the argument. I believe that if Members are in-the-know about these things and are prepared to ask for rebates, they will find that our hotel rates can be extremely low by international standards. They are very reasonable. In fact, the occupancy rate has gone down. One Member wondered why the occupancy rate is in reverse proportion to the number of tourists coming in. The answer is very simple. There are more rooms than the required proportion to cater for the number of tourists coming in.

There was another suggestion that the prices in some of the coffee houses are rather exorbitant. I am a bit puzzled by this because, although I have also read the same letter in the press concerning this matter, I believe that quite a number of our young boys and girls now make it a custom to go to these coffee houses. I cannot understand how they can afford it if the prices are very high. Nevertheless, this is a matter which the Tourist Promotion Board may well consider.

If I may now go on to the Economic Development Board, A very serious criticism against the Economic Development Board was made by the Member for Changi, although he did praise its efforts at economic promotion. He said that they had gone into risky ventures, and he took exception to this. I should like to inform him that the E.D.B, itself does not participate in industrial ventures any longer. Therefore, I cannot understand his remarks. Their efforts are now confined solely to the promotion of industrial ventures, while industries are being financed by the Development Bank of Singapore. The feasibility studies which the E.D.B. make are usually for the benefit of entrepreneurs so that they will be encouraged to investigate in further detail the various projects that have been studied. I do not think the E.D.B, can guarantee that any feasibility studies they make will ensure that anyone investing in the projects will certainly make money. But if his criticism is against the Government going into these ventures and against the competence of our officers in the Boards of Directors, I should like to say that in some of these ventures the directors have proved that, even if the Member considers them not very capable, they would at least be able to make profits for the owner, that is, the Government. These profits are particularly good in the shipyards that we own. I think the Member for Changi should know whether this is an industry that requires particular skill in management.

The Member for Whampoa suggested that we should consider setting up a secondary Stock Exchange to deal with shares of ventures which are rather risky and do not qualify for listing under the present Stock Exchange Regulations. I am rather hesitant about this suggestion. I do not think we want to encourage our shareholders, who are perhaps not so well informed about shares, to place their money in such ventures.

The Member for Bukit Merah welcomed the intention of the Ministry of Finance to mechanise the various Government Ministries and departments. I will certainly press on with this mechanisation. He has also mentioned manufacturing industries, and has made a number of suggestions in, for instance, the electronics, ship building and ship repairing industries. He has also made various other remarks on trade and tourism. I have noted all these remarks and will give them consideration.

I have also noted the remarks of the Member for River Valley on the development of local technology. His remarks strike a very sympathetic chord. It may be because I was involved in the setting up of the Industrial Research Unit which has now become the Singapore Institute for Standards and Industrial Research.

If I may now deal with the suggestions made about the various Ministries. As I have said, I can do so only on a very general basis because I am not responsible for them. The Member for Paya Lebar has said that in respect of education, the pendulum has perhaps swung too far in the direction of technical education. I myself do not think so, in fact, we could do with a lot more technical education. However, I accept the point which he no doubt wanted to make, and that is, that in our pursuit of science and technology, we should not forget the need for a knowledge of the humanities and of the social sciences, particularly those which deal with political as well as social leadership. I think among the many tasks which this Government has been faced, the most difficult one - it may be more difficult than promoting a G.N.P, growth rate of 15 per cent per annum is the promotion of a spirit of national consciousness, a sense of identity with the country. If we can inculcate this spirit in our people, then many of the other tasks which we have set ourselves will be made that much easier.

I have also listened with great sympathy to the Member for Jurong's very eloquent address in favour of agriculture and fisheries. The Member for Jalan Kayu has given his wholehearted support to this matter. I can only say that, although I did not make mention of this subject in my Budget Statement, I am fully conscious that we must do what we can to promote the development of agriculture and fisheries, as we will have to keep all our economic sectors as viable as possible. However, in the context of Singapore, agriculture must be of an intensive nature. We simply do not have enough land for the kind of farming that is very extensive and which is in evidence in other countries.

The Member for Jurong also spoke of our limited 33,000 acres of agricultural land and about 23,000 families who are dependent on farming and fishing. Our agricultural farming must be of the kind which produces leafy vegetables. We have never produced rice and Singapore cannot produce any rice. I hope that we would never have to attempt to produce any of the staple commodities. However, we have given every encouragement to the ways in which Singapore can be most productive. This is animal husbandry, concerned with the production of pigs and also with industrial methods of rearing poultry, i.e., if you start with an egg at the top of an industrial or flatted-farm building, it should after going through a spiral come out at the end as a chicken! These projects in animal husbandry, egg and poultry production, have pushed its contribution to the G.D.P, to the very high value, as has been quoted by the Member for Jurong.

He has also made a plea for the setting up of an agricultural bank, and was very aggrieved that in spite of having made this suggestion a year ago, the matter has not been taken up. I am afraid I must keep on disappointing him because I do not think there is enough business to justify an agricultural bank in Singapore.

With regard to the financing of fisheries, the Development Bank of Singapore has already a division of at least several officers to deal with loans to fishing fleets. Again, the amount of business which they have been able to do is not very large. I would suggest to the Member that the best hope for financing is though the Ministry or the department concerned with the extension work of supplying poultry or pigs to the farmers for rearing. The other method would be by fostering co-operatives, which was also mentioned by him.

With regard to fisheries, as pointed out by the Member for Jurong, it is true that we produce very little for our own consumption. As Chairman of the Economic Development Board for a number of years, I tried to foster deep-sea fishing projects, but did not quite succeed. It does seem as if our young boys are so accustomed to urban living that they are unprepared to go for long periods out to sea to catch fish. The various efforts which have been made have not been quite successful. If our local boys and local entrepreneurs have any real interest in deep-sea fishing, I think they would get great encouragement from both the Government and the Development Bank of Singapore. And I am sure that our Marine Police and other departments will try and protect our fishermen wherever they can from being arrested, unless they stray into other territorial waters.

The Member for Jalan Kayu mentioned the resettlement of farmers. He seems to consider that the Government should, as far as possible. resettle our farmers in permanent areas which would be kept for that purpose. That is very difficult in the circumstances of the very limited land available. Various Government departments themselves have had in the past to be resettled in favour of other Ministries. I remember that when Jurong was being established and we were pushing westwards, all of a sudden a few, hundred acres of land were suddenly lopped off for the Defence Ministry from the Master Plan for Jurong Town, and all our plans had to come to a dead halt. If it was not possible in the old days for either the Jurong Town Corporation or the E.D.B, to safeguard their lands, it is very doubtful that the needs of farmers can over-ride those more important considerations.

If I may now come to ports. It was said that T had not mentioned anywhere in my Budget Statement the progress of our container port. The Member for Anson is obviously very interested in this. But I am riot responsible for ports other than to make financial provision for it in the Development Estimates. However, I am sure that with a vigorous Chairman at the head of the Port of Singapore Authority, its development is not lagging. At the last World Bank meeting, we certainly registered our interest in financing for this subject with the World Bank directors.

One or two Members mentioned the Far East Freight Conference and the treatment given to the Neptune Orient Lines. I do not wish to say anything at this stage about the Far East Freight Conference, and the Neptune Orient lines' claim for a greater share in the cargo trade. I would merely say that for some of the shipping lines in the Conference to make claims on our cargo trade because of historical grounds is really to invite a reply on a political basis. It certainly smacks of colonialism to speak of their traditional right to the cargo trade of Singapore.

The Member for Katong suggested that it is desirable to aim at a higher rate of growth for public housing, especially when urban renewal sites are not being let out for further development. I can assure the Member that any slack in construction activity will certainly be taken up as a matter of priority for public housing.

I am grateful for the tribute which has been paid to the Parks and Trees Division. Perhaps it is the Member for Katong who made this comment.

Mr Speaker, Sir, I think I have dealt with most of the points raised by Members. I would merely like to say that it has been very pleasant to be Minister for Finance at a time when the economy enables you to be a popular Minister, and I hope that our economy will equally continue to boom in the next few years.

Hon. Members: Hear, hear!

Question put, and agreed to.

Resolved,

That Parliament approves the financial policy of the Government for the financial year 1st April, 1972 to 31st March, 1973.