PRIVATE SECTOR CONSTRUCTION INDUSTRY (Measures to stimulate)

Mr Ivan Baptist asked the Minister for National Development and Communications whether his Ministry will be taking measures to stimulate the building construction industry in the private sector which is declining.

Dr Tan Eng Liang (for the Minister for National Development and Communications): Mr Speaker, Sir, the general world economic condition is largely responsible for the decline in private sector construction activity. Demand for more residential and commercial facilities can only increase through renewed business confidence and economic growth. Therefore, so long as there is doubt about the world economic recovery, it would be difficult to stimulate private sector construction to pre-recession levels.

Nevertheless, my Ministry is continuing to encourage and assist private developers. There will be further sale of sites by the Urban Redevelopment Authority for commercial, residential, hotel and industrial developments. Processing of plans submitted by developers have been streamlined to reduce delays. Developers can now submit an outline application and obtain quick in- principle approval.

Mr Ivan Baptist: Mr Speaker, Sir, does the Hon. Minister of State intend to introduce incentive schemes to ensure that private developers are encouraged to increase development in their sector? The second supplementary question is: does the Hon. Minister of State realise that we are losing many skilled guest workers? Unless steps are taken to get private developers to increase their activities, such loss would be detrimental to Singapore.

Dr Tan Eng Liang: Mr Speaker, Sir, in the earlier stages of encouraging construction activity, the Ministry of National Development has given certain forms of incentives, such as property tax concessions and so on. But the very fact that the hon. Member has asked about the construction industry being in its doldrums at this moment must have indicated to him that there are offices, residential properties and commercial facilities left vacant. Hence, the private developers will know when to come into the market and whether it is time to go into additional activities.

As far as we are concerned, if the Member is talking of incentives of a financial nature, such as concessions on property tax, income tax, and so on, then I suppose this matter can be referred to the Ministry of Finance for consideration. Attempts have been made by my Ministry to grant some form of incentives but this has been turned down by the Ministry of Finance. The hon. Member is probably aware that in this House some hon. Members have asked if CPF contributions could be used for the purchase of private residential properties and this has been turned down by the Ministry of Finance. I am not so sure what other forms of incentives that the Member has in mind, but if he has any idea of what these can be, we will be very happy to receive his suggestions and convey them to the relevant Ministry to see whether they can be agreed to.

As to his second question on the losing of skilled manpower, particularly in the construction industry, the hon. Member is aware that, as far as the public sector is concerned, i.e. the HDB and HUDC, there is rio slack in the building construction activity. In fact, this could be an opportunity to improve the quality of the finishes of the HDB flats because skilled labourers are still in great demand in the public sector.

Mr Ivan Baptist: Sir, a further supplementary question. Is the Hon. Minister of State then willing to employ these very skilled workers who have lost their jobs in the private sector, and to consider upgrading the quality of HDB flats, because there have been a lot of complaints about their poor quality?

Dr Tan Eng Liang: Sir, I have mentioned that there is a lot of construction activity in the public sector. For example, the Airport development is another area of intensive construction activity and there are other public sector projects. Here, it is a matter of demand and supply. For example, if a skilled worker in the private sector is so spoilt as to demand very high wages for a particular type of building construction work, then I think it would be unrealistic if he expects to get the same rate of wages in a public sector project. What I am trying to assure the hon. Member is that as far as skilled manpower is concerned, the demand is there.