ANNUAL BUDGET STATEMENT

[Mr Speaker in the Chair]

Debate resumed.

Dr Augustine H.H. Tan (Whampoa): Mr Speaker, Sir, as we look back at 1981, we should be very thankful to Almighty God for blessing this nation of ours. In the midst of a very dismal year for most countries in the world, with recession, high unemployment and inflation, we achieved almost 10% economic growth. Our inflation rate was below the average OECD rate and those of ASEAN, Hong Kong, Taiwan and South Korea. It is almost a miracle.

The Ministry of Trade and Industry aptly described our growth rate as enviable. The Hon. Minister himself must also be the envy of his colleagues elsewhere for being able to present solid achievements for 1981 and to offer tax concessions at a time like this. However, Sir, I am sure neither the Government nor the Hon. Minister would wish to rest on their laurels. Moreover, as they are constantly exhorting Singaporeans to better effort and performance, it is the duty of Members of Parliament to point out shortcomings and to make constructive suggestions so that the Government can make greater and better efforts for the improvement of our nation. Please note my use of the word "constructive" as opposed to destructive and that which appeals to emotion. One can also speak out of resentment and bitterness and one can pander to the gallery. I hope, Sir, that Members of Parliament will avoid this during the course of the debate on the Budget.

I propose now to review our economic performance for last year. Let me hasten to add, Sir, that I am speaking with the benefit of hindsight and from the perspective of the armchair.

As I read the Economic Survey of Singapore for 1981, the first observation that came to mind was that domestic factors were more important for our economic growth last year than in previous years. (1979 and 1980, external demand contri- buted 73% and 72% respectively to our economic growth, while last year it contributed only 53%. In other words, 47% of our growth last year was internally generated. But for the big decline in holdings of inventories, the contribution of domestic demand would have been greater. This is a reflection partly of adverse world economic conditions, partly a reduction in the rate of capital accumulation and partly a relatively high rate of consumption expenditure, There was, for example, a 21% increase in expenditure on recreational goods and services. The last factor does not augur well for the future.

The Economic Survey also reported that the three fastest growing sectors of the economy were financial and business services (18%), construction and quarrying (17.7%) and transport and communications (12.6%), noting that the financial and business services sector contributed 27% to the overall GDP growth rate. The Economic Survey went on to point out, and I quote from page 15 of the Economic Survey:

'Healthy demand for domestic and offshore banking and other financial services and buoyant activities generated by the thriving stock and property markets provided the main impetus to the expansion.'

In other words, Sir, speculative activities in the stock market and property market generated high profits for banks, brokerage firms, real estate agencies and legal firms. This statement is confirmed by the Economic Survey on the same page where it says:

'Despite depressed re-export trade, banks extended loans and advances at a more vigorous pace than in 1980. A greater proportion of the increase in loans and advances was used to finance the booming construction industry and property market as well as activities in the stock market.'

I would have more to say later about our monetary policy.

For the moment, Sir, let me concentrate on the property market. The Economic Survey also states:

'The property market remained active in the early part of the year. Fuelled by strong demand for residential, commercial and industrial properties as well as by speculation, property prices continued to rise sharply in the first half.'

What the Survey failed to mention is that property prices increased by well over 500% between the end of 1979 and June 1981. And, contrary to what the Economic Survey reported, property prices did not fall considerably in the latter half of 1981. Such prices were and are still 350-400% higher than in 1979. As I warned in the debate on the Presidential Address in this House in February last year, the inflation in private property prices inevitably affected HUDC and HDB prices by escalating land and construction costs. And sure enough, barely six months later, both of these agencies raised their prices. I might add, Sir, that one additional undesirable sideeffect of the property market boom was the election of the Member for Anson.

The question is: Could the unhealthy property boom have been avoided? In my view, there would still have been a boom as an upturn in the construction cycle was overdue and as property prices were rising in most countries of the world in reaction to inflation. However, I believe we could have moderated the boom somewhat.

Consider, Sir, the following factors: Firstly, Government's land alienation policy. Government is the largest landowner in Singapore. Moreover, Government has been acquiring huge amounts of private property to build HDB flats and also for URA development. No figures are published but I rather suspect there has been a net decrease in private land holdings over the years. Moreover, URA's tender system has probably contributed to the inflation of property prices. At the last URA sale, for example, some choice property sites were withdrawn because the tenders were considered too low. Government could have helped to stabilize the property market if the land had been sold cheaply.

Secondly, plot ratios and density regulations. Sir, I am not an architect, neither am I an engineer. But I am told that the regulations laid down by Building Control Division in respect of plot ratios, heights of building and density of different types of building use have contributed significantly to the cost of each square metre of floor space constructed, In view of the land shortage in Singapore, as so vividly illustrated by the Minister for National Development himself recently, perhaps the Building Control Division may want to review its regulations.

Thirdly, unnecessary frills in condominiums. I notice, Sir, that many condominiums have swimming pools, tennis courts, squash courts and other recreational facilities. Moreover, in many projects, the floor space per apartment is very generous. All these add significantly to cost. In view, again, of the land shortage and demand for recreational facilities, might it not be better to avoid private recreational facilities and provide more clubs which the general public, including HDB dwellers, could join?

Fourthly, foreigners are allowed to buy condominiums. In 1974 or 1975 the property market was greatly stabilized when the Residential Property Act, which prohibited foreigners from owning residential property in Singapore except by permission, came into force. Subsequently, as a result of representations by developers, the Act was partially lifted to allow foreigners to own condominiums or to buy flats in buildings above six storeys. The net result was an unprecedented boom in the property market, pricing most properties beyond the reach of Singaporeans, If the Government were to reimpose the Residential Property Act, prices would drop to more realistic levels.

Fifthly, wrong timing in the release of CPF funds for private housing. The Government's intention to release CPF funds for purchase of private residential property was a good one. Unfortunately, the timing was inappropriate and exacerbated the boom. Consider, Sir, the effect of the boom on the real value of our CPF holdings. Before the boom, a CPF balance of, say, $100,000 could have bought a decent terrace house or apartment. After June 1981, the same amount could only buy a third or less of the same unit.

Sixthly, release of Government building projects. When the property boom was in full swing, Government launched many new building projects, escalating construction costs. Sir, consider the data on construction contracts awarded during the first three quarters of 1981, as reported in the Economic Survey of Singapore, Third Quarter, 1981.

Government should have withheld some building projects last year. Instead, it gave out $3,059 million worth of building contracts for the first nine months of 1981, or 66% of the total for the period. In the third quarter, it tendered out $1,549 million worth of contracts, double the average quarterly value of contracts and more than double those launched by the private sector. I believe that there should be better coordination between the economic planners of the Ministry of Trade and Industry and the physical planners of the Ministry of National Development. There is no reason why we should be building Raffles City, Marina City, Changi Airport, viaducts, roads, HUDC, HDB flats, hotels (and note, Sir, we are trying to double the hotel capacity over the next five years), shopping complexes and private residential units all at once. We can surely phase the various projects so as not to overstrain the capacity of the construction sector. Last year, the construction sector grew by 31% in current prices or 17.7% in real terms. No wonder there was such a big labour shortage and no wonder the productivity in construction actually declined. And no wonder building costs escalated tremendously. Table 40 on page 64 of the Economic Survey shows that the construction sector experienced the highest rate of inflation in the economy of 12% compared to the GDP deflator of 5%.

I come now to the subject of money supply and inflation. In his Budget address the Hon. Minister complained about what he called the stubborn rate of inflation of 8.2% in Singapore. This is, of course, lower than the OECD rate of 10.8% but somewhat higher than Japan's 4 3/4% and West Germany's 5 3/4%. The Economic Survey stated that 58% of the inflation was due to rising food prices and that 60% was internally generated. However, we should note that the figure of 8.2% represents an average inflation rate for the whole of 1981. For example, the December cost of living index itself was 10.4% higher than a year earlier. In January of this year, the cost of living index was rising at an annual rate of 12%.

The question, Sir, is: What are the causes of our inflation and whether we could have managed with lower inflation? There are both internal and external causes.

Let me deal first with the external causes. If the exchange rate is fixed at, say, S$2.10 for every US$l, then a 10% US inflation would also raise prices in Singapore by 10%. However, if we allow our exchange rate to fall by 10%, then we need not import the US inflation at all. It follows then that the key to imported inflation lies in the degree of flexibility in the exchange rate that we are prepared to have. On page 71 of the Economic Survey, it is stated that:

'in maintaining the stability of the exchange rate, the authorities had to balance the benefits of an appreciating Singapore dollar in containing imported inflation against the adverse effect on the competitive edge of Singapore's exports of goods and services.'

I suspect, however, that we could have allowed more flexibility in our exchange rate, thereby importing less inflation. I do not believe that our exporters would have been hurt by greater appreciation of our currency for two reasons. The first is that imported inputs probably constitute about 64% of the value of manufacturing output. Hence a currency appreciation would have lowered costs of imported inputs even as it lowered selling prices of exports in Singapore dollar terms. Secondly, the OECD inflation rate of over 10% already provides our manufacturers with considerable competitive edge.

Let me now come to internal causes, the first of which is money supply. When we try to hold down the value of our currency, the Monetary Authority of Singapore's official reserves increase and there are more Singapore dollars in circulation, causing domestic inflation. Col. 725 of the Economic Survey reported that, on the average, our money supply as defined by M1 grew by only 12% last year compared to 14% the previous year. However, there were a number of aberrations. At the end of December 1981, our money supply as defined by M1 had actually grown by 18.1% compared to December 1980. Moreover, during the last quarter of 1981, the money supply grew at an annual rate of 49%. No wonder, Sir, the stock market took off again early this year. Sir, please note that according to the Economic Survey Report itself, 59% of the increase in bank loans and advances last year went to the following: Building and construction ... 23% Financial institutions ... 20% Professionals and Private Individuals ... 16% In other words, a substantial part of the increase in money supply went to speculative purposes in the stock market and in the property market. The Monetary Authority of Singapore was probably trying to keep interest rates low in Singapore in an effort to encourage investment. For much of last year, our interest rates were on the average 5-6 percentage points lower than the Asian Dollar rates. This further indicates the under-valuation of the Singapore dollar. However, instead of investments being stimulated, the resultant effect of the increase in money supply was to fuel speculation in the stock and property markets. I do not believe that keeping interest rates low will help our exporters when there is a world recession on and people just do not want to buy our products. We only compound our own inflation problems and distort the stock and property markets. If we wish to help our exporters, we could do so directly by preferential lines of credit instead of increasing money supply generally.

The second cause of domestic inflation is our ambitious growth targets. At the present stage of development, I believe that a growth rate of 8-10% is ambitious and will inevitably trigger high inflation because our labour force is growing at a much slower pace than the last decade and there are infrastructural constraints and construction bottlenecks, as noted by the Minister himself. The question is: are we prepared to pay the price in terms of a distorted property market and a distorted structure of wages and salaries? Please note that something of a merry-go-round has already started. The private sector salaries for the graduates and professionals have increased way above the public sector, and recently the Hon. Minister himself had to announce substantial wage increases for graduates in the public sector. This will merely push another round of salary increases because basically there is a shortage of graduates and professionals caused by our very high growth rate. At the same time, these professionals and graduates are not going to be satisfied with the wage increases because they are much less meaningful today since they can no longer buy the type of housing that they could have bought three years ago.

The third domestic reason for inflation is the National Wages Council (NWC). We have had three years of high NWC wage increases. Let me illustrate this problem by taking the case of a barber. Because workers in manufacturing and other sectors of the economy get NWC awards, the barber, the person who cuts your hair, feels that he too must reward himself or else it would not pay to be a barber after some time. There would be very few people willing to be barbers. There is no productivity increase in barbering. The barber can try to cut your hair faster with possibly disfiguring results. Similarly, bus conductors, bus drivers, chambermaids, sales-girls, waiters and waitresses get NWC awards without necessarily increasing productivity. The hawker too raises his prices, as he must, because if he does not do that, no one wants to be a hawker after some time. But there is no productivity increase. The result can only be inflation. We should, therefore, take the Hon. Minister seriously when he exhorts us to increase productivity, wherever possible, in the economy.

To sum up on inflation, Sir, we could have reduced the inflation rate by, first, increasing the flexibility in our exchange rate; secondly, by controlling the money supply more carefully; thirdly, by being less ambitious about economic growth and, fourthly, by phasing our construction projects to prevent overstraining our construction capacity.

Let me now turn to the Budget for 1982-83. The three-fold objective of increasing skilled and professional manpower, of further developing our infrastructure and our public housing, are realistic and consistent with the long-term development of Singapore. Singapore's annual budgets for the last 21 years have, in general, been exercises in good stewardship. As usual, emphasis is put on development expenditure which takes up 55% of the Budget. Recurrent expenditure is kept to a minimum with emphasis on manpower saving through mechanization, rationalization and computerization to increase productivity in the public sector.

I am only a little uneasy about the additional amount of $1,720 million budgetted for the Petrochemical Corporation of Singapore. I only hope that the project will be viable or else it will turn out to be an expensive white elephant. I am also a little concerned at the high standard of luxury in new buildings put up by statutory boards and by the Government itself. In the Energy section of the Economic Survey, it is reported that electricity consumption by the public sector itself rose by 18% for the Government itself, that is, taking out the statutory boards, electricity consumption rose by 31%. I get a little worried by the vast airconditioned corridors and open spaces at the Singapore General Hospital, and at the luxurious facilities that I see there. I see no reason why people, who can afford to pay for luxurious rooms, cannot go to private hospitals. I still believe that the public sector should provide decent facilities at low prices. Similarly, Changi Airport itself has a lot of vast open spaces and I shudder at the airconditioning cost. I hope that the civil servants themselves will take the lead in minimizing luxury and in saving energy.

Coming back to the Budget for 1982-83, Members should not be alarmed by the $3 billion deficit. The deficit is to allow the Government to tap the resources of the Central Provident Fund which now annually generate about $3 billion for development purposes. In fact, Members may like to know that the public sector as a whole, inclusive of the statutory board, generates a substantial surplus every year. This is reflected in the increasing foreign exchange reserves as reported in our Balance of Payments.

On the question of tax concessions, Sir, while I welcome the additional relief for CPF contributions, I should like to see explicit provision to encourage people to take up insurance policies. I am concerned that, for many people, housing will gobble up most of their CPF balances by the time they retire, leaving them with little to live on. A good insurance policy will alleviate social hardships and save the State from rescuing destitute people later on.

Sir, what I find most unusual about this year's Budget is Government's concern about the preservation of the family. First, there is the concern about promoting filial piety by increasing the allowance for aged dependants. However, the income ceiling of less than $1,500 per year that dependants are allowed to have, is very unrealistic. And if people are honest, very few will qualify for the relief. In his address, the Hon. Minister stated, and I quote:

'We will have to be more imaginative and more determined in our efforts at retaining a large number of our womenfolk in the labour force without endangering the upbringing of our children. The family unit is the most fundamental building block in our society and is an institution which we must cherish and preserve even at the cost of sacrificing some economic growth.'

Sir, this is indeed a most refreshing and necessary change of emphasis. When women go out to work and commit their infants and toddlers to baby amahs and baby sitters, I believe that there is a great psychological cost in the alienation between mother and child, and the child will grow up with a sense of rejection, hurt, insecurity, selfishness, even a sense of abuse and rebellion. It is simply not worth it from the point of view of developing a healthy nation. After the children have grown up, women may re-enter the labour force. Alternatively, as the Member for Leng Kee has suggested, work could be farmed out to the homes or short-shifts could be devised.

Finally, Sir, I agree with the Hon. Minister's warning of the economic dangers we face this year. He was not exaggerating when he spoke of the possibility of the world economy going into a tailspin, and by that I think he means an economic depression. At the most, the OECD countries are expected to recover only slowly and only towards the latter part of the year. In view of the time-lag, it will be a few months before Singapore can catch up. We can, therefore, expect increasing protectionist pressures upon our exports this year.

At home, a pressing issue is to build more homes, especially HDB flats. The problem is not whether we can build 58,000 HDB flats in the next two years or 21,000 private and HUDC units in the next three to four years. The question is whether the prices will be affordable by the people. We need, therefore, to set our construction priorities urgently and examine the economic implication of Government land, zoning, building and other policies.

Permit me now, Sir, to conclude by congratulating the Hon. Minister for Trade and Industry for a Budget which is not only imaginative but incisively presented. It is a Budget reflecting not just one man's wisdom but, I believe, the accumulated wisdom of 21 years of Government and eminently deserves the Support of every Singaporean. 6.00 p.m.

Mr Jeyaretnam: Mr Speaker, Sir, as has been said by several hon. Members in this House tonight, the Hon. Minister who proposed this Budget Statement need have no qualms that the financial policy contained in his Budget Statement will find acceptance from almost all the Members of this House, regardless of what I do say about this financial policy and the Budget of the Government.

Sir, the Hon. Minister reminds us at the beginning of his Budget Statement that the third part of his Statement deals with "the estimated expenditure incurred in achieving our social and economic objectives." It is as well to remind ourselves that when the Government puts forward its financial policy for the year that lies ahead and presents its Budget, it presents to the Members of this House, as representatives of the people whom we are privileged to represent, an opportunity to examine what the Hon. Minister has termed "our social objectives" and what I would, if I may term "our vision of the society that we desire for our people in Singapore." It presents us with an opportunity to redefine this vision, if any redefinition is needed, and to reaffirm our determination to achieve this vision of the society that we have in mind. It is therefore necessary to have in mind what is the vision or the goal that we are all, in this land of ours, striving to achieve. At one time, Mr Speaker, Sir, it was proclaimed that our goal was a rugged society. We heard a lot of talk that our society should become a rugged society. Then it was felt that the people were confusing in their minds the rugged society that the Government wanted for its citizens with a ragged society, and therefore there was the danger that what we were striving for would be thought to be a ragged society, and therefore talk of a rugged society was dropped.

Mr Speaker, Sir, we have recently heard from the Government Benches, from Ministers and others a new goal of the society in our midst. We have heard a lot of talk quite recently of a caring society. But let it be whispered in this House that this conception of a caring society had its origin in 1976, not very long ago, when a political party - need I name it - in presenting its programme in 1976 -

An hon. Member: Rumours!

Mr Jeyaretnam: - called its programme "Towards a Caring Society." Since then a number of people have taken up this cry of transforming our society into a caring society. It is not just the.Government, the Backbenchers, the Ministers but the private sector has also come in on this concept of a caring society. We do not want to take very much credit for all this sudden concern, although it needs repeating that the concept of this caring society was first propounded by this political party.

The Minister for Home Affairs (Mr Chua Sian Chin): The British Labour Party!

Mr Jeyaretnam: Mr Speaker, Sir, this vision of the society must be a vision that is common to all members of the society. It must be a vision that is common not only to the wealthy, the young and the able bodied, but also to the poor, the old, the sick, the needy, however inconvenient they may be to the Government's vision of a rugged society. Whatever the goals, however they may be defined from the Government side or from the Opposition side, I take it we are all agreed that the aim that we are all striving here in Singapore is to enable our citizens to lead happier and fuller lives, to realize their full development as human beings.

As I have said, Sir, the Budget debate presents us with an opportunity not only to reaffirm and to redefine our goals, our vision of the society that we have in mind, but also to see how far we have travelled along that road in the past year under review and to see whether we are any nearer this vision than we were this time last year when the Budget was presented. The Hon. Minister says in his statement, as evidence of the well-being of our people leading happier and more fuller lives that "real income went up by 8.5%." He says "Singaporeans did not suffer any cut in real income." Mr Speaker, Sir, as a piece of statistical information, of course, that may be correct. But does it tell the whole story? Does it look at the different income groups in our society and see whether this real income growth of 8.5% was true of all income groups and not just of one particular income group?

I find, Mr Speaker, Sir, that the monetary wages for our manufacturing sector workmen, the productive labour force, went up by 14%. But there must be many hundreds of our workmen who have had no increase over the year in their nominal salaries, because I need not remind the House that the NWC increases are not implemented by all employers. There is no sanction for their implementation by all employers. And it will be interesting, Mr Speaker, to know what percentage of our workforce in this country has benefited by the NWC increases from the time that they were first implemented in 1974.

But leaving apart the thousands of our workers who may have had no increase at all in their nominal wages, let us look at those who had their wage increases because of the NWC awards which were implemented by the employers. The average wage increase, as I have stated and what one would find from the Economic Survey for 1981, would appear to be 14%. What is the real income growth? You have, as against that 14%, an increase in the contribution that has to be made by the employee, i.e. the worker, to the Central Provident Fund, That increase was 4% of his wages. So that reduced the annual wage increase to 10%. Then we find that the average inflation growth was 8.2%. So if you add 4% to 8.2%, you get 12.2%, leaving a possible real income growth of 1.8% in this sector.

But even that, Mr Speaker, does not present a true picture because when we talk about the growth of inflation at 8.2%, we are talking about the general growth. But we do know, and as borne out by the Economic Survey, that it was in the area of foodstuffs that prices rose very sharply; and food prices went up 10% over the last year. Again, it needs no saying that when you come down to the working class, to the people with lower incomes, they spend a greater proportion of their salaries on food than on anything else. So this increase of 10% hits them very, very badly because about half of their income has to go on food. If you now find that there is a 10% increase over what they spent on food in the previous year and if you add to that the CPF increase of 4%, where is the income growth for this group of workers? They have no growth in their real income, and it is my respectful suggestion that it is very possible that they have suffered a cut in their real income, not an increase, because the inflation rates that are given out in these graphs and surveys talk of the general average increase. But the person who actually spends, who has to meet rising prices, knows to his or her pain that the increases go beyond the 8.2% that the graphs talk about.

The Hon. Minister said that he has taken the views of various business groups, NTUC, CASE and the University. Barring the business groups, I wonder who he talked to in the NTUC. Was it the Secretary-General of the NTUC, another Minister in the Government that he talked to, to find out the views of the workers? Did the Minister try to collate and gather the views of the workers on the factory floor? Did he find out how they felt about the previous year, about their real income growth, about the benefits that they have had, about whether they have had any greater share of the cake that they have had to bake for the society?

Then he said he spoke to CASE. I do not want to belittle what this organization is doing. I find it very vocal and very good, salutary, when it comes to protesting against any increases in the private sector. When a cup of coffee goes up by five cents, you find CASE very vocal about it and, rightly so, inquiring as to why a cup of coffee has to cost another five cents more. But when I find that the Government puts up its fees and charges, there is not a squeak from CASE.

An hon. Member: It has been well explained!

Mr Jeyaretnam: Yes, it has been so well explained that CASE accepts it. There is no answer to that. I would again commend to the Hon. Minister and to the future Ministers who may be presenting the Budget that perhaps they should also take the views of others and one area where they can profitably take the views is the housewife. Perhaps it should be made mandatory or compulsory for Ministers who present the Budget to go round and ask the housewife how she has fared over the last year in trying to make ends meet, the family's needs.

I do not propose to make an analysis of all the measures that the Minister has outlined and which the Government had taken to improve our economic growth. I have no quarrel with that, but there are one or two things that I would like to touch on. One of the recurring themes in the Minister's statement is the need to increase our productivity. That I suppose needs no saying again. We find the Minister and several hon. Members in this House speaking of the need to increase our productivity. There are two partners in this productivity. There is, of course, the management and then there is the other partner, the worker. The Minister has acknowledged to some extent, but perhaps if I may say so a little grudgingly, the contribution made by the workers in Singapore to our economic growth. I quote him:

'A large part of this came from the efforts of the individual Singaporeans in responding to economic restructuring. They worked harder and smarter than the year before and acquired new skills.'

Sir, the Minister was less grudging of the contribution made by our workers when he spoke at a University forum last year. It was a forum on the issues facing Singapore in the 1980s, and the Minister speaking at the forum on 11th December 1981 had this to say about our workers, and I quote him:

'When properly motivated and led, the Singapore worker is a formidable force. He has shown repeatedly in the last two decades that he is quick to learn, ready to pick up new skills and willing to work hard to build a better life for himself and his children. When put to the test, I believe that our workers will not be found wanting in determination or ability.'

Further down, he says:

'it is ultimately the Government's responsibility to point the direction, set the parameters and give a push where necessary. But it is the workers -'

And I pause here, Mr Speaker, Sir, and I am obliged to him that he puts the workers first.

An hon. Member: Workers, not Workers Party!

Mr Jeyaretnam: 'and management who will decide whether or not Singapore continues to thrive in the 1980s or begin the slippery slide to disorder, unemployment and stagnation.'

There you find due recognition and high praise of what our workers have contributed to the building of our society in Singapore, to this economic growth that we are all so proud of, so that in the statistics of the world Singapore may be shown as an economic miracle, "Singapore has achieved, in the face of all these, this economic progress." But let us not forget those who made this possible. I am not saying, far be it for me to say, that the management, capital, the people with monies, had no part in this economic growth. Of course, they have. But let us not forget at the same time, whilst heaping praise on all this capital, investment and management, the contribution made by our workers to the economic growth in which, as I have demonstrated, they would appear to have benefited very little, if not none at all. A lot of this economic growth would appear to have gone to people who have the money, who do not need the money, and very little of it, if at all, went to those who are really in need of the money.

He speaks of the need to properly motivate our workers. May I ask what plans has the Government got to motivate our workers? A person can only give of his best when he is properly motivated and led, and the motive cannot and does not always rest on monetary awards or monetary benefits. There are other considerations that are just as important before a worker identifies himself with the work that he is doing and gives of his best. It is not just monetary awards. It is the other less tangible, but just as important, considerations that govern the motivation of the worker or any person before he identifies himself with whatever he is doing. I ask, Sir, what plans has the Government got to motivate our workers?

I find on col. 539 of the Budget Statement this statement by the Minister that the National Productivity Council "is examining how workers can be encouraged to identify themselves more closely with the company they work in by means of company-based welfare benefits and other measures." Sir, if productivity is essential to our economic growth, if productivity makes the difference between succeeding or failing, this motivation cannot be left to companies. The Government must set the lead and must lay down the proper guidelines for getting the best from our workers. So I ask: what plans has the Government got to motivate our workers?

There have been over the last years steps taken to discourage our workers from transferring their services from one employer to another, job-hopping as it has been called. Workers have been penalized for job-hopping. I would ask the Hon. Minister to consider whether this restraint - apart from it being a restraint on the freedom of the worker to take his services wherever he pleases and to offer it to whoever pays him best - is not also a restraint on improving productivity, on getting the best out of our workers? If we are going to tie our workers down to companies where they are employed, regardless of whether the company pays them well or adopts techniques to improve productivity, what inducement will there be for the company to improve productivity by introducing measures of its own? Should it not be the other way, Mr Speaker, Sir? It is only by encouraging our workers to move to wherever they think they can acquire better skills because of better opportunities provided so that they can give of their best and learn more skills, that productivity would be increased in the end.

Has the Government got any plans about equity sharing by workers in the companies they work in? Should we not be thinking along those lines? Even if it is not something that we can enforce today or tomorrow, should we not be thinking about giving our workers a share in the equity so that they have a stake in the company in which they are working, thus making it obvious to them that their welfare, the increase in their living standards, their being able to lead happier, better lives, are tied up with the company's success because of their share in the company's equity?

There is the other factor about their tenure of office. I shall have more to say about this, Mr Speaker, Sir, when we come to debate the Ministry of Labour's estimates. But suffice it for me to say at this moment that under the present Employment Act, under our enlightened labour laws, our workers have no tenure of service. I have had the unpleasant or unhappy task of having to advise people who, having worked 15 or 20 years with a company, suddenly find themselves being handed a letter one morning to say that their services were no longer needed, and that they might now leave and they would be paid four weeks' wages in lieu of notice. "Goodbye. Wish you better success so me-where else." This is what our worker finds he is entitled to under the law for his 20 years of service. What has the Govern ment got to say about this? Is it not time that we provided some guaranteed tenure of service for our workers who have given faithful, loyal service to the company?

There is, in other countries, legislation against unfair dismissal, where the companies can be ordered to take back the employee, the worker, where the tribunal is satisfied that there has been an unfair dismissal of the worker. But more of it later.

Some speakers here have spoken of the unhappiness, and I have come across it myself, Mr Speaker, Sir, caused by the way the NWC second tier has been implemented. Is it not time that perhaps further thought be given to the second tier increases which have caused a lot of unhappiness among our workers?

There is yet another way by which our workers may be encouraged to give of their best, and that is, the provision of homes for them and homes as near as possible to their place of work. Has the Government got any plans, any policy, to try (it may not be possible to do this in every case) to arrange so that workers live as close as possible to their place of work?

There is also the question of rent. I shall have more to say about this when we come to debate on the Ministry of National Development. But I would, at the moment, commend to the Members of this House what has been said by the hon. Member for Whampoa. He has spoken of the rising costs of construction brought about by over-building in Singapore. He has asked, and I repeat his question: "Why is it necessary to have all these buildings going up at one and the same time?" He spoke of the Marina Centre, Raffles City, hotels, shopping complexes.

An hon. Member: Pulau Bukom.

Mr Jeyaretnam: Are we not bringing about an artificial shortage of workers and an artificial shortage of materials needed for our most important area of construction, that is, public housing, where we need to house our workers? I find that buildings which have many more years of life are torn down just because the owners feel that the land is under-utilized. It may be that it is under-utilized, maybe they think they are not getting enough returns. So we find buildings like the Chartered Bank in Battery Road, the Hongkong & Shanghai Bank in Collyer Quay and the Orchard in Orchard Road which have many more years of life to come, are all taken down. Is there not a considerable waste in all this - tearing down of buildings that are still good - all in the name of progress? It is all right if it does not have any ill-effect on members of the society, but it has ill-effect as the Member for Whampoa has pointed out. All this has led to an increase in the price of homes for our workers. Again, repeating what the Member for Whampoa has said, should we not have some priority in our construction?

Mr Speaker: Mr Jeyaretnam, may I remind you that you have only three minutes left.

Mr Jeyaretnam: Yes, Sir. Mr Speaker, Sir, craving your indulgence, if I may now turn to the tax reliefs, The Hon. Minister spoke of them as the most exciting part but perhaps not the most important part of the Budget Statement. But as has been pointed out by another hon. Member, the tax changes are to many the most important part of the Budget. What do we find? We find no increases in taxes and the Hon. Minister has announced that he is giving four concessions. Now, it does not need very much examination to see that all these reliefs that have been announced by the Hon. Minister will benefit not the lower income group; they will benefit not our workers who have contributed to this economic growth of which we are all so proud; they will benefit, in the main, people higher up in the tax bracket. How many of our workers contribute more than $5,000 in CPF contributions in a year? So where is it going to benefit them?

On the residential properties exemption, as has been pointed out, how many of our lower income groups have properties worth more than $600,000? So let us not try and pretend that these concessions are going to benefit the majority of our citizens. They will not. They will only benefit a minority, a small minority at that.

Against this, Mr Speaker, Sir, on Wednesday, 3rd March, we saw a Bill passed at its Third Reading giving back something like $81 million of our moneys, as I said then, to people who had enough and to spare. It is against that that we should look at the reliefs that are given now: $81 million to people who do not need the money.

Mr Speaker: Mr Jeyaretnam, your one hour is up.

Mr Jeyaretnam: May I just conclude, Sir?

Mr Speaker: Yes.

Mr Jeyaretnam: Sir, as I have said, I find lots of things in this Budget Statement which are good. I cannot pretend to advise the Minister on the economic measures that have been taken, and in my humble opinion they are very good. But what I quarrel with is the distribution of this economic growth. I say, there has been an unfair, unequal distribution of the economic growth and, for that reason, Mr Speaker, Sir, if only for that reason, I shall vote against the Statement.

Mr Chua Sian Chin: Mr Speaker, Sir, in view of the fact that it is the Member for Anson's maiden speech on the Budget Statement, can you not allow him to continue if he has anything more to say?

Mr Speaker: I am sorry. He is only allowed one hour.

Dr Tan Cheng Bock (Ayer Rajah): Mr Speaker, Sir, the Hon. Minister for Trade and Industry has presented a "breather budget" to quote the Straits Times of 6th March 1982. It further reported that while cautioning the economic dangers facing the Republic, he still had some good cheer to spread around. Very few can quarrel with this budget. Nevertheless, I would like this House to share with me and, in particular, the Member for Anson, a few observations on how the various tax concessions were asked and fought for by my caring senior MPs and perhaps drive home the point that this Government did not start caring from 1976 but as early as 1959.

Some hon. Members: Hear, hear!

Dr Tan Cheng Bock: Mr Speaker, Sir, last year at the annual Budget Statement debate, the Member for Punggol in his discourse on estate duties called for a change in the ruling on estate duties. I quote Hansard of 17th March 1981, Vol. 40, No. 7, col. 740:

'I think it is time we changed the rules and, if I may be allowed to suggest, we should consider granting exemption of estate duty to a single residential property or a family house. In other words, if the owner of a residential property has only one such property, then upon his untimely demise his family will not be displaced just because his property is valued to be in excess of $600,000 or whatever figures set down.'

Then, together with the Members for Telok Blangah, Henderson and Changi, he went on to discuss pensions and tax reliefs for maintenance of aged parents. He said:

'I believe that repetition of appeals can help to drive home to the Minister the importance of these issues and cause him to re-think, and hopefully touch some soft spot in him which I am sure he is not without any, because he must also realize that it is only a matter of time before he himself would be a pensioner and an aged parent.'

With your indulgence, Mr Speaker, Sir, I would like to go into the Hansards over the past 10 years. On tax matters, let me illustrate how diligently our senior Members of Parliament in this House have fought and finally touched the soft spot of the current Minister for Trade and Industry who finally agreed to the request on tax concession on estate duties, PUB bills, relief for aged parents and tax relief on CPF contributions and pension concessions.

Let me take the subject of estate duty which has been debated in this House for a long time. In 1972, the Minister for Finance in his annual Budget Statement allowed for remission from estate duty on estates between $10,000 and $25,000, and you must listen to his reason. In Hansard, Vol. 31, No. 9, col. 537, he said:

'This will ensure that poor beneficiaries inheriting small estates do not suffer by having to sell or mortgage their modest dwellings and possessions on the death of the breadwinner.'

Then in 1974, after repeated appeals by Members of Parliament, the Minister for Finance raised the exemption and made remission limits on estate duty in respect of one owner-occupied family house but rejected the call for exemption on one house when, in a reply to a Backbencher in Hansard, Vol. 33, No. 1, col. 71, he said:

'Such an exemption would benefit the wealthy more than others and result in discrimination against other forms of assets like shares, deposits and life insurance policies.'

He went on to say:

'The proposal will give full relief to people in the lower income group living in all, even the largest, HDB flats, who form about 40% of the population. The people in the middle income group living in owner- occupied terrace, semi-detached and even detached houses will have the burden of estate duty considerably reduced.'

The exemption on one house for estate duty was again rejected by the then Minister for Trade and Industry last year, when he said: [Hansard, Vol. 40, No. 8, col. 771].

'I would think that the proposal would be inequitable because, what is a house? There are houses which are worth a couple of million dollars and there are houses which are worth $700,000 or $800,000, and others very much less. A more equitable basis is what we have done - to set a quantitative ceiling on exemption. If $600,000 proves to be inadequate because of escalating property prices, we can always look into the possibility of upping the exemption ceiling.'

Then this year the Minister for Trade and Industry agreed to the repeated requests and granted the exemption from estate duty for one house. And this was after the perseverance, persistence and dogged effort on the part of my senior colleagues in this House. Let it be made known that this concession and the other tax concessions which I will be touching on later are given not because of the presence of an Opposition Member. I would like to draw the attention of this House to the repeated pleas of the Backbenchers over a 10-year period or more and how, bit by bit, tax concessions on estate duty were given because this Government is manned by pragmatic and reasonable people.

Let me illustrate further. I shall touch on PUB tax, a very common man's concern. Mr Speaker, Sir, the question of tax on PUB bills was brought up in this House way back in 1971 when the Member for Whampoa on the 30th July 1971 during the debate on the President's Speech [Hansard, Vol. 31, No. 2, col. 85] said that:

'Certain taxes are inherently regressive, that is, they bear on people who can least afford them. I am concerned about the incidence of such taxes as taxes on PUB bills, for example. Although the tax is graduated with a higher tax on bigger bills, poor people with large families, and therefore using more utilities, are adversely affected.'

Between 1971 and 1977, many MPs showed concern about the PUB taxes and rising PUB bills. The Minister for Finance rebuffed the arguments and said that the tax on PUB bills would be reviewed from time to time. It was therefore not surprising that, in the annual Budget Statement in February, 1978, the Minister for Finance made the following announcement on 27th February 1978 [Hansard, Vol. 37, No. 7, col. 422]:

'One concession which I propose to give to consumers is by the abolition of the 5% tax on PUB bills which is now effective for consumption levels between $35 and $50 per month. With effect from 1st April, only consumption levels of $50 and above will be subjected to tax at the same rate as before, of 10%. The revenue loss is estimated at $5 million.'

Of course, the Member for Anson at that time in 1978 was among the first to shower the Minister for Finance with praises saying [col. 652]:

'This is also a timely gesture to the majority of the low-consumption consumers whose bills are within that range. This gesture will also help other consumers to be thrifty in the use of utilities so as to avoid paying the 10% tax on bills which are above $50!'

He was supported by other Backbenchers, including the Member for Boon Teck who said in that same debate [col. 681]:

'it has been another major concession in this Budget Statement for the Finance Minister's decision to scrap the 5% tax on PUB bills of between $35 and $50. I am glad that this Government is not oblivious to the voice of its people through their representatives in Parliament. This is a popular move because there is an actual savings of about $2 per household per month. I am happy that the merits of the abolition of this tax will no doubt provide an added incentive for Singaporeans to save water and to conserve energy.'

This tax concession was, however, offsetted by the increase in PUB charges, and members of the public and MPs were particularly vociferous in the call for the abolition of the Government tax on PUB bills. This call was last made in Parliament by the Member for Alexandra during last year's Budget debate when he maintained that this tax was an unnecessary burden on consumers, even more so with the new rates. This year's announcement that Singaporeans would enjoy lower PUB bills because fixed charges on PUB bills such as sanitary appliance fee, domestic refuse charge, rental for appliances and nightsoil removal fee, will no longer be included in the computation of the 10% tax is only a small concession but nevertheless it is a start for more concessions in the future.

Mr Speaker, Sir, I shall now turn the attention of this House to the tax relief for aged parents. As far back as 16th March 1972, the Member for Delta appealed for tax concessions, and this is what he said [Hansard, Vol. 31, No. 10, col. 607]:

'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.'

In 1973, in the annual Budget Statement, the Minister for Finance agreed and granted tax relief of $300 per parent but stipulated that the parents must stay with the taxpayer citing that "the Asian concept of the extended family is of a family living together." Since then, Members of this House have fought this issue on two grounds, the quantum of relief and the conditions for relief.

In the 1974 Budget Statement the sum was increased to $750 after repeated calls by Members of this House. And finally, in this Budget Statement the quantum has been increased to $1,000. With regard to the condition that the taxpayer must be staying with the parents to enjoy this tax relief, a case can be made out for the taxpayer who stays on the same floor with the parents, but not sharing the same address. This is possible because during resettlement large families are housed close to each other in the same block. The parents may be staying next door to their son who is a taxpayer. Can he get tax exemption if he is the chief provider for his parents?

Sir, the tax relief on CPF contributions and its benefits to the taxpayer need no elaboration. Once again, I would like this House to note that these concessions given by the Minister for Trade and Industry were made, I am sure, after considering the many pleas by Members of this House over a long time. I could continue to quote from the Hansard to prove my point, similar to my earlier discourse on the PUB tax and estate duty. The point is that PAP MPs and this Government do care and are fully aware of the needs of the people and that these tax concessions are won by the sheer persistence of the caring PAP MPs over the years.

Mr Speaker, Sir, I support the motion. 7.03 p.m.

Dr Ang Kok Peng (Buona Vista): Mr Speaker, Sir, against the backdrop of a year of general economic disarray in the world, with diminished international trade, sluggish growth of the advanced economies, political turmoil and armed conflict in several parts of the world, Singapore registered a year of orderly social progress and achieved a 9.9% economic growth. This is a creditable achievement by any measure. It reflects a correct economic strategy, and the industry and adaptability of a people ever willing to acquire better skill and expertise to strive forward in a difficult world environment.

In examining Singapore's economic performance for 1981, one notes an important new feature which shows that our economy has developed and matured further with domestic contribution to our economy accounting for about half of the expansion of the economy - a far cry from the days of nearly total dependence on trade. This is even more remarkable when we consider that we have an open economy in Singapore.

The implication is that Singapore is now more resilient to the ebb and flow of international trade and finance as the domestic component of its economy can serve to cushion unfavourable external influences on our economic progress.

The picture of world economy for 1982 is indeed grim, and the most vulnerable sector of the economy is external trade. The buffering action of our domestic component will have to be relied upon even more to help sustain a satisfactory economic growth for 1982.

The Budget Statement before the House has been received with relief by all and sundry as there is no proposal for new taxes, In fact, it contains some tax concessions although not as much as many would have liked. These have been very well dealt with by my colleagues earlier on and I shall not repeat them.

It has also been described as a "painless budget" reflecting a cautious response to the economic uncertainty of the world.

The Budget is development-orientated. It is forward-looking, something uncommon in present-day economies. Besides proposing to speed up the construction of public housing to meet increasing demands, it aims at the development of technical and professional manpower and the stepping up of the development of infrastructure, industries and commerce.

This is a positive approach and will place us in a better position to sustain growth and accelerate the process of restructuring the economy with yet enough leeway to respond quickly to the changing world economic situation.

To be able to present such a Budget to the House, the Minister for Trade and Industry is indeed in a position enviable by many a counterpart of his all over the world whose concern is how to combat high inflation compounded by massive unemployment and how to cope with persistent deficit in balance of payment. The current budgets of many of the advanced economies are of the remedial type, often with little leeway for promoting economic development.

Mr Speaker, Sir, having made my general comments on the Budget Statement, I now wish to raise a few points for the Minister's attention. First, let me refer to the tax on the PUB bills, This tax, I stand to be corrected, Sir, was imposed as a source of revenue a long time ago. At that time it was an important source of revenue but now, with the expansion of our economy, its relative importance has diminished considerably. The prime objective of this tax now is to encourage conservation in the use of services provided by the PUB. For this purpose, would not a graduated rate of surcharge be more effective in promoting the habit of conservation in using gas, water, and electricity?

Another point which I would like to touch upon is the Housing and Development (Amendment) Act, 1979, which allows a lessee or an owner of an HDB flat to purchase commercial property of a value not exceeding $250,000 for conducting his own business. This value was set sometime ago. Since then, the value of commercial properties has soared. Would the Minister look into this matter with a view to raising the ceiling of $250,000 to a more realistic amount?

As regards estate duty, the Minister has been very generous in granting exemption on one residential property without a limit to its value. The upper limit of the remission of estate duty, however, remains at $180,000. Such an exemption of a residential property from the estate duty thus discriminates against other forms of assets, such as shares, deposits, and life policies.

For an estate without a residential property, would the Minister consider the exemption of one commercial property owned and used by the deceased while alive, in place of the one residential property?

And for an estate without a residential or commercial property, would he consider an upward revision of the remission limit of $180,000 which was fixed in 1974?

In FY 81 there was a provision of $395,700 for the financing of an Institute of Occupational Safety and Health but there is no such provision in this year's Budget. I would not for a moment suggest that there is a relegation of the importance of occupational safety and health. From what I could gather from the Memorandum on the Budget, the promotion of occupational safety and health has now come under the purview of the National Productivity Board. I hope the Minister can enlighten the House on the rationale for,the transfer of the functions of the previously proposed Institute to the National Productivity Board.

Mr Speaker, Sir, our economic performance in 1982 will be circumscribed by development in the major industrial economies of the world. Dark clouds in the international scene forebode a storm. We need to pull and strive together to tide over this difficult period as best we could.

On this note, Mr Speaker, Sir, let me associate myself with my colleagues in supporting the Budget Statement. 7.12 p.m.

Encik Abbas Abu Amin (Pasir Panjang): Mr Speaker, Sir, I wish to offer my congratulations to the Hon. Minister for Trade and Industry for once again presenting what has been generally,acknowledged as a "very reasonable and cautious budget with something for everyone". Although it is difficult to please everyone, the Budget appears to have achieved the impossible. In the preparation of the Budget, the Minister has taken into consideration the prevailing turbulent world economic conditions and, rightly so, decided not to "rock the boat" any more by levying new taxes or raising the rates of existing taxes.

Mr Speaker, Sir, it is gratifying to note that productivity, in the past year, increased by 5.4% as a result of the business enterprises taking a judicious view of the potential of our economic restructuring and consequently investing in mechanization and automation. This was complemented by the efforts of union leaders and workers. Our disciplined workforce led by able, positive-thinking union leaders, has always been one that responds to the nation's call for survival and progress. The exhortations and call for improved productivity, better work attitudes and better people-management have been successful largely through the Government's efforts and Labour's cooperation. With economic restructuring, the enhancement of the quality of the workforce becomes essential. Economic restructuring is often equated with the adoption of higher technology and modern methods of production. However, for mechanization, automation or computerization to be effective, our workers must adapt to the new work environment. They will have to be trained or retrained to man the new and sophisticated machinery and software.

Our workers must become more competent in their jobs, if we are to succeed in meeting the challenges from a competitive world. lb this respect, I am glad to note that great efforts have been made by the Government to increase the student population in the technical field, both i-n the vocational institutes and tertiary institutions. Training of unskilled workers

In promoting the acquisition of higher technical skills, emphasis has been placed on the skilled workforce to further their levels of attainment. But in our keenness to do this, we must never lose sight of the plight of the unskilled and semi-skilled workers who are at the lower rung of the economic ladder. They form the bulk of the older group of workers; and in the early days of industrialization process, it was they who formed the very backbone of our manpower supply. We cannot ignore them now.

These workers have been side-tracked from this race for acquisition of new skills for a variety of reasons, one of which is educational disability. If nothing is done to uplift this body of workers, they are doomed to continue to work in lowpaying, unskilled jobs which could one day even become obsolete with greater technological advances. If these unskilled or semi-skilled workers are not helped to advance to higher level skills, I am afraid they will increasingly constitute a drag on the rest of the society and undermine all the previous socio-economic gains made in the Republic.

It is our duty and responsibility, therefore, to take adequate measures to help them to upgrade their knowledge and skills. Thus, they will become more productive and consequently improve their material well being. I fully support the recommendations made by the hon. Members for West Coast and Geylang Serai on ways and means of upgrading the performance of this category of workers. The NTUC has taken steps to re-educate and retrain these workers through the various education and training courses. I urge the Government to give full support to this good gesture.

Job-hopping

Mr Speaker, Sir, it was indeed heartening to hear the Hon. Minister state that in the year 1981 there were lesser instances of job-hopping. This goes to prove that the average Singapore worker is maturing fast and has realized the potential advantages of a steady career in a good enterprise.

These positive attitudes could be further enhanced if the management or employers take the lead in creating a more conducive industrial environment so that workers could feel that they are part and parcel of the enterprise. Some companies, however, have already taken the lead and formed Quality Control Circles or Work Excellence Committees. The Government and statutory boards have Work Improvement Teams (WITs). All these committees have been formed with the main objective of improving productivity, staff morale and team spirit. However, the success of such committees attaining the desired objectives depends to a large extent on the interest, enthusiasm and encouragement shown by the top management and employers. Employers have the responsibility to ensure that they continue to motivate these committees to succeed by sending the members to appropriate courses organized by the National Productivity Board. Perhaps the Government should encourage more such committees to be formed, and also to step up on the number of NPB courses available.

Housing and Development Board (HDB)

Mr Speaker, Sir, in the Budget Statement, the Hon. Minister has emphasized that the construction industry is of vital importance to the economy of the country.

It is heartening to note in this regard that positive steps are being taken to build more flats in the next two years to meet increasing demands. However, there is still concern about the continuous supply of skilled construction workers, as we still need to employ foreign workers from non-traditional sources.

The long-term plan for the establishment of a Special Training School for construction workers is indeed laudable. In the meantime, more young Singaporeans should be encouraged to become construction workers, so that eventually a permanent pool of such a workforce could be set up. Efforts should also be made to enlighten both trainees and parents on the relevant advantages of pursuing a career in the construction industry. They should also be assured that such a career is relatively safe, challenging and rewarding.

In this context, I would like to refer to the SAF Boys' School that is run by the Ministry of Defence. In the school, youngsters between the ages of 14 and 16 and who are of average ability not only learn a trade and receive continuation education but are also instilled with a deep sense of loyalty and discipline. The vocational training they receive equips them with sufficient skills in the Technical, Combat and Logistics fields for a fruitful career in SAF.

Perhaps a similar scheme could be devised for the training of skilled workers for various categories of jobs in the construction industry.

Pensions

Mr Speaker, Sir, I am not glorifying the Budget but I feel that one particular concession deserves mentioning. The special recognition accorded to the long-term needs of the pensioners in the lower income group, who are heavily burdened by the high cost of living, is, indeed, timely. Such concern and care has helped much to eradicate the general feeling among pensioners of being neglected and disregarded.

It is also praiseworthy that the Hon. Minister has found it fit to increase the tax relief for aged dependants from $750 to $1,000 per aged parent. But with the current inflationary trends, I feel that this increase is still not sufficient. I would like to suggest that the tax relief for the aged parents be raised to $2,000 per aged parent, which sum is equivalent to the relief for the maintenance of handicapped dependants, I feel that the maintenance and care of aged parents is not an easy task to shoulder, especially by workers in the middle or lower income groups.

Sir, on this note, I support the Budget Statement by the Hon. Minister for Trade and Industry. 7.20 p.m.

Mr Goh Chee Wee (Boon Lay): ( In Mandarin): Mr Speaker, Sir, despite the deep economic recession facing various countries throughout the world, particularly the advanced countries in Europe and America, Singapore still managed to achieve an impressive economic growth last year. There are many factors contributing to the rapid economic growth of our Republic, the most important of which are the enlightened economic policy of our Government, our political stability and the diligence of our people, together with the confidence that foreign investors have in us.

With such economic growth, the standard of living of our people is enhanced. We are also particularly glad in that we have been able to achieve full employment at a time when the European and American countries are facing serious unemployment problems. From our experience we know that so long as there is close cooperation between the Government and the people together with a policy of pragmatism, we are able to clear all the obstacles and to continue to forge ahead. It has been proved that the shouting of slogans alone will not bring wealth to our people. It can only create disturbances in our nation and society.

According to studies carried out by a number of international authoritative organizations, our Republic has been listed as one of the few countries with the most favourable investment climate. There are very detailed analyses based on the political situation, the administrative efficiency and the productivity of people in various countries. From their studies, the United States and other international organizations concluded that they should single out Singapore as a model for the other developing countries to emulate. These reports are certainly a great help to our Republic in the promotion of trade and the attraction of investments.

Unfortunately there are some people among us who are using all sorts of methods to undermine the reputation of the Government. They even adopt unscrupulous methods, such as spreading rumours, to deliberately cast unfounded slander on us. If their plans were to succeed, then the confidence the foreign investors have in us will be shaken. We must do something to hit them back good and proper.

Mr Speaker, Sir, in many countries the people are very anxious and worried whenever the government announces its financial policy. Their fear is that the government will impose new taxes. But in Singapore the situation is just the opposite. Because of our fast economic growth, the Government has not found it necessary to increase the tax rates for a number of years. Yet, at the same time, extensive construction programmes are being carried out.

With the rise in our standard of living, the demands of our people are also increased. With inflation, the Government's expenditure has increased from year to year. Despite such circumstances the Government is able not to increase the tax rates. This is indeed a very good gesture. I sincerely hope that the Government will continue with its policy of not increasing the tax rates for the next few years. But, of course, if the Government can give us further reduction on the tax rates, it will be even better.

There is no doubt that the major tax concession announced this year would benefit those people in the higher income group more than those in the low income bracket. I would like to take this opportunity to invite the Minister's attention, when planning future Budgets, to the fact that the interests of the people from the lower income group should also be considered.

Mr Speaker, with economic restructuring and the phasing out of the labour-intensive industries, we have to pay particular attention to the retraining of our present workforce. If we do not raise the educational level and upgrade the skills of these workers, then once they are retrenched they will not be able to find alternative employment. Of course, our factories today also require workers who are better trained. The qualities of a worker that the industries are looking for today and in future are quite different from those in the 1960's. At this point I would recommend that the VITB, the National Productivity Board, the Economic Develop- ment Board and the Skills Development Fund, together with the NTUC, should jointly determine the types of skills that are required and to formulate some plans to enhance the skills of our workers, with particular attention to those who are facing retrenchment.

I would like to point out that the courses offered by the VITB are conducted in English while most of our workers, particularly the elderly workers, are not conversant with English. The VITB should consider conducting some of their training courses in Mandarin. The use of English in industry and commerce and as a medium of instruction in technical training and education is a right move. However, in the matter of providing training courses for our existing workers, we have to be flexible. If a worker aged 30 to 40 years wishes to take up a technical skill, let us say, carpentry or plumbing, why should we compel him to learn English first, before giving him a chance to be trained? The ancient master of carpentry in China, Lu Pan, did not learn English, and yet that did not prevent him from being an outstanding carpenter. Of course, from a practical viewpoint only certain trade courses can be conducted in Mandarin, thus narrowing down the scope of the courses available. I do not deny that it is more practical to conduct most of the industrial skill training courses in English.

The only resources the Republic possess are human resources. Therefore, we should spare no effort to upgrade the quality of our manpower through better education and training for our next generation. What is regrettable is that in a progressive society like ours, we still find some school children who drop out halfway through their education. Therefore, they remain illiterate and unskilled. According to the latest statistics, in 1980 alone, about 17,000 students left school before completing Secondary IV. Another 9,000 did not obtain three passes in 'O' level examinations. Out of this total of 26,000 school leavers, only 5,000 enrolled in various VITB courses. The rest left school without acquiring any vocational skills. This is a serious loss to our society as well as to our nation.

I therefore urge the Government to seriously consider implementing a system of compulsory education to ensure that our people do receive a certain level of formal education to help them acquire certain skills. It may be claimed that compulsory education infringes upon human rights. If a citizen does not wish to be educated, why should he be forced to do so? We are aware that, in implementing policy, the Government may have to take certain unpopular measures, but they are for the good of the nation and for the good of the people.

On the issue of compulsory education, I believe the majority of the people will support it.

According to statistics, 37% of our population aged 15 and above are economically inactive. Most of them are housewives, students and pensioners. Now that we are facing a labour shortage, the Government should try every way to induce these people to come out to work. The Government should give incentives not only to the professional women but also to womenfolk in general. Therefore, I would like to make two proposals to the Government:

(1) to give full support to the NTUC, management and voluntary organizations to set up creches;

(2) through tax reliefs, to induce women to come out to work. For example, the current Income Tax law allows professional women to increase the tax relief for children to up to $2,000. However, this is only confined to women who are University graduates. The Government should see to it that more personal reliefs or reliefs for children should be given to working women in general.

Another point is that in most private firms, employees retire at the age of 55 which is too early. I believe that Singaporeans are now enjoying a longer life span. So whether you look at it from the perspective of personal interest or national interest, we should encourage employers to extend the retirement age beyond 55 years. In this respect, various measures and incentives should be adopted by the Government to encourage the employers to do so.

Our national wealth has been created by the hard work of the people. We do not have to depend on others to give doles. We do not harbour any unrealistic fantasies. Our Government and our people are not magicians. We do not create wealth by waving a magic wand. If we look around us and try to gauge what we have achieved, be it housing, schools, health care, roads, parks or skyscrapers, we realize that all these are the fruit of our people's labour and hard work. We are not going to allow anyone to undermine what we have achieved or to poach our hard-won fruit. Some people have suggested that having a proper job and a good house are the fundamental rights of our citizens. But in actual fact when a country is on the brink of bankruptcy, its people do not even have the right to three meals a day. We learn from recent newspapers reports that even the most developed countries are faced with serious unemployment problems. In Europe alone, the number of jobless people will reach 16 million. The situation in other developing countries is even worse. People in a certain country even pick grain from cow excrement. When a country is in such a plight, what human dignity and basic rights can one talk about? It is not slogan-shouting, it is not fantasy, or clamouring for human rights that can provide us with a job for everyone, decent housing and health care. The only way that a people can ensure welfare for themselves is for them to work harder in order to create wealth. The Government's duty is to provide effective infrastructure, sound planning and political stability and a good investment climate and employment opportunities.

Facts have shown that the Government has already achieved such objectives. But I regret to say that even today there are people who, under the pretext of safeguarding the workers' interest, viciously attack the Government by saying that the Government is a repressive and exploitative regime. We need only to make a comparison between what a Singapore worker earns and the standard of living he enjoys today and what he earned 20 years ago to come to the conclusion that such criticism is nothing but rubbish. Facts are indisputable, and the fact staring into our eyes is that the standard of living that the people of Singapore enjoy today is one of the highest in Asia. This further illustrates the success and soundness of the Government's strategy in economic development.

Mr Speaker, Sir, I hereby give my fullest support to the financial policy of the Government for 1982. 7.35 p.m.

Encik Mansor Haji Sukaimi (Kampong Kembangan): Mr Speaker, Sir, I do not understand why the Member for Anson is so unashamed as to claim credit when it is not due to him. I say this not with malice or ridicule because I have respect for the man. After all, he is an honourable Member of this House. I say this because I think it is necessary for us to know that this debate is a serious matter and if there should be any criticism of the Government, I think all of us have to play a role, and I will be one of the first Backbenchers to point any mistake or deficiency of Government in the interest of the people of Singapore. But when we do this, let us do it with some very basic principles.

As my colleague, the Member for Ayer Rajah, has said, the concept of a caring society is not a new concept. It did not originate in 1976. It went back, I think, earlier than 1959, even to 1954. We knew from the start that the political parties in Singapore would never be a credible movement until and unless we care for the people, we care for their problems, and not only care but work for it to create the means to bring about what the hon. Member for Anson referred to as getting Singaporeans to have happier and fuller lives and to help them to develop their potentials to the maximum.

Even on this point, he seems to suggest that all the while we have ignored this fundamental responsibility of politicians to their constituents. Why do we improve our universities? Why do we spend so much money on schools and industrial training institutions? Why do we make an unpopular decision to get employers to contribute towards the Skills Development Fund? Is it not because we have recognized the need to develop Singaporeans' potentials? If the hon. Member for Anson finds any deficiency in the Government's policies on training, development and education, I think he and all of us have that profound responsibility to raise them in this Chamber.

But let us do it with a clear understanding that our job here is an honourable task and we must do so with full facts. And if the hon. Member for Anson disagrees with the policies of Government, and I do not think he has been thorough with his arguments - I noted that he raised only 13 or 14 points - if he really has reasons, he must come out with alternative programmes. Tell the people of Singapore why and how the Workers Party can be better than the PAP, and I think Singaporeans deserve better programmes if there are good reasons.

Mr Speaker: Encik Mansor, may I remind you that this is a debate on the financial policy of the Government and not on the Member for Anson?

Encik Mansor Haji Sukaimi: Yes, Sir. It is for this reason that I see the debate on the Budget as a very serious debate.

Mr Speaker: It is on the general principles of the budget.

Encik Mansor Haji Sukaimi: If the hon. Member for Anson has a better programme than the Hon. Minister for Trade and Industry, I think he should present it to this House and let us consider it together.

Mr Speaker: He has not done so. Will you please carry on with the debate on the general principles of the financial policy of the Government?

Encik Mansor Haji Sukaimi: My due respect to you, Mr Speaker, Sir. Let me come to the debate on the Budget. We have heard many arguments from the Backbenchers. In fact, we owe a lot to the hon. Member for Whampoa for raising many good points, and if you will allow me, Sir, to reiterate this point - if the hon. Member for Anson really has good points, I think he should bring them up for discussion together.

As regards the Budget debate, and since you have made a specific request, Mr Speaker, Sir, my general comments are that this Budget which has been presented by the Hon. Minister for Trade and Indus- try reflects continuity. There are no new taxes. There are no fundamental changes in the basic financial and development policies which were set out in the programmes for economic structure by the preceding Budget Minister, Mr Goh Chok Tong. I think this continuity is a good sign. It shows the validity and credibility of the thinking of the preceding policies. This continuity is reassuring.

The significance of this point may not be apparent. We know, for instance, in some other societies how often and tempting it can be for a new Minister to make his brand felt by making sure that his ideas are made to prevail or even seen to over-ride those of the preceding Ministers. Sometimes there is even an effort to make sure that the past policies are cast aside, drastically modified or, worse still, condemned. But in this particular instance, we have seen the maturity and the insight of the Minister for Trade and Industry in reiterating the strength and correctness of past policies and in making programmes to ensure that this will continue. I therefore wish to congratulate him for these programmes.

I have chosen to speak only on two points. One is on company welfarism and the other is on industrial robotics, I have chosen these two points for three reasons. First, these two points were not highlighted in previous budgets. Secondly, both of them, especially company welfarism, have wide implications on the social fabric of our society. Thirdly, especially on industrial robotics, it is a very new concept and there could be misconception if this is not well explained to the population as a whole.

Company welfarism

This is a new dimension in the overall economic restructuring programme and it is one that is very significant.In his Budget Statement, the Hon. Minister should have given this subject greater treatment because, as I have said, this is a new concept and more so as I have come across many people who, I think, have a misconception of company welfarism. They equate company welfarism to staff recreation and staff welfare. If I am not incorrect, this is a misconception. Com- pany welfarism goes beyond staff recreation and staff welfare. In fact, if I am not wrong again, the main thrust of the recommendation on company welfarism came more strongly from the recommendation of the Committee on Productivity which was chaired by the Hon. Minister of State for Labour, and its recommendation was made in the latter part of last year. The recommendation was made after an indepth study of the experience in Japan where the management's concern for the employees was based on the profound and abiding understanding of and respect for the workers, not just for profit motives. There is concern for the workers' family.

Company welfarism in Japan entails not just giving or providing recreational facilities, good welfare, good wages but also concern for the workers' families and their children's education. In many instances, many companies in Japan ensure that the children of the workers are assured of jobs when they finish school or graduate from universities.

I do not know whether this concept has been well understood in Singapore. If it is not the case, I think we ought to ensure that there is a proper understanding. I say this because we in Singapore are all too steeped with the traditions of British socialism where, under this concept, the understanding of welfarism is very different. And the PAP itself had long projected the role of government as the main force in providing public housing, decent health care, education, etc. But when we take on this programme of company-based welfarism, the concept is very different. We can foresee the situation where large corporations in Singapore can take on greater roles in the provision of housing and medical care of their workers which at the moment are primarily rendered by the Government.

So I would like to suggest, if I may, that the Minister inform us of more details about the programme on company-based welfarism, what details are in the pipeline, what activities or programmes will be implemented beyond the recommendations of the Committee on Productivity, and whether efforts will be made to promote a better and correct understanding of company welfarism for more workers and Singaporeans.

Secondly, I have noticed that, whilst some Ministries do have provisions for staff welfare, there are other Ministries which do not have any provision at all. I notice, for example, in the Postal Services Department and the Airport Fire Service, there is no provision at all for staff welfare and recreation. If there are special reasons for this, I would be grateful for the Minister's explanation. Otherwise if we really take this concept of welfarism seriously I could see the need for each Ministry to have its own policy and programme of staff welfare and recreation and all those related to this concept.

Thirdly, if we are to take this concept seriously, and since it is not just staff welfare or recreation, maybe we need to develop a kind of prototype model or models of company-based or organization-based welfarism describing its attendant operational details, its guidelines, its activities, how it should be managed and planned and get this institutionalized in larger numbers of Ministries, departments and even companies in the private sector.

The next point is whether we really have the expertise to promote this idea of welfarism. If there is insufficient expertise, would the Minister consider the need to develop this expertise. Finally, would the Government develop this company-based welfarism on a long-term basis so that it will extend to both the private and public sectors?

Industrial robotics

I welcome the Government's intention to promote the development and greater use of industrial robotics in our effort to raise productivity and industrial sophistication. The experience of Japan and a number of highly industrialized countries tells us that greater application of industrial robotics is one answer to ensuring greater productivity and also an effective solution to the problem of labour shortage. While the development and application of industrial robotics is a recent development - I understand this was actively pursued about 15 years ago - it will be unwise for us to take a wait-and-see attitude. The longer we wait, the farther will we be left behind in this new technology. Instead, we must push our efforts to learn as much as we can and take urgent but systematic steps to promote greater use of robotics in our industrial sector.

My questions to the Minister are:

1. What steps will Government take to promote greater use of industrial robotics in Singapore, besides of course granting tax concessions and incentives under the Government's Economic Expansion Incentives (Relief from Income Tax) Act and also through loans under the Small Industries Finance Scheme.

2. Do we have sufficient expertise in Singapore in this field of industrial robotics? If not, what steps will Government take to ensure that there is continuous growth of the expertise that is needed for this purpose? Does Singapore participate in international symposiums, like the ones that are organized annually - if I am not wrong it is called the International Industrial Robot Symposium - the 11th Symposium being held in Japan in October last year. And during that symposium I understand that 750 researchers from the United States, Europe and other countries presented about 100 research papers. I think we would benefit through our active participation in such symposiums.

3. Considering the possible fear of workers of their being displaced with the greater application of robotics, what steps will Government take to ensure that there shall be no undue displacement of workers? What details ought to be given to workers, to be explained to them, so that they will understand the reason, the purpose, the benefits and the rationales for greater application of robotics in our industrial endeavours? In this regard, will the Government seek the active participation of both management and the labour movement so that both will get the benefit of the greater application of industrial robotics, while ensuring minimum disrupion to the workers in Singapore?

7.50 p.m.

Dr Koh Lip Lin (Nee Soon): ( In Mandarin): Mr Speaker, Sir, in his Budget Statement the Minister for Trade and Industry has mentioned about our good economic performance last year and the prospects for this year. I believe that, with the cooperation and effort of all our people, this year will be another successful year.

Sir, I would like to touch upon certain aspects of our education. The budget allocation this year is 45.6% more than that for last year. This shows that the Government is attaching greater importance to education. From the standpoint of an educationist, this is really a cause for elation. Other than human resources, we do not have any. From a long-term point of view investment on education is the most judicious investment. Our people, particularly parents, are deeply conscious of the importance of our children's education. The importance that parents attach to their children's education can be seen from the fact that they are selective in their choice of schools for their children, they engage private tutors for their children, and are concerned about their children's examination results. This is evidence of the great demands on education and it reflects our high standard of education and our social progress. However, there is a difference between our school education and that in the Western developed countries. Our school teachers and parents pay too much attention to the examination results and certificates, while our students specialize in copying, learning by rote and doing exercises. Under this fad, other than feeling the pressure of school lessons, our students have little time or the mood to read other books or to do something outside their school curriculum or to participate in non-compulsory activities which will benefit them.

The Minister of State of Education sometime ago said in this House that the average number of hours spent on homework by our children compared with Australian school children is about the same, and therefore he concluded that "these hours are not excessive by any standard." I disagree with this view because our students' homework is, in fact, very different in nature from that of students in other countries, particularly those in Europe and USA. They are not comparable. On this point, I would like to discuss with the Minister of State of Education on some other occasion.

The peculiar characteristics of our education system may circumscribe the wisdom of the majority of our students. This is not good for our students as well as for our society, Recently some Education Ministry officials went to Japan to study certain aspects of their teaching system and curriculum. Their Report points out the shortcomings of our secondary school Mathematics teaching system and suggested certain improvements. I believe the same is true of other secondary school subjects. I think the adoption of any new system should aim at correcting our mechanical ways of learning by rote. Although educationists are aware of the disadvantages and bad points about this method of teaching and learning, but because of the importance of achieving good results in the examinations they have no alternatives, since examination results are the only standard of assessment for all. Schools producing good results are recognized as good schools and students with good results are recognized as good students. It seems that other factors are neglected and are not given any consideration. I hope, in its future development our Education Ministry will correct this aberration.

The purpose of a formal education should be to provide the basic training in the learning of languages, science and skills and the development of a healthy body and mind, and also instilling moral concept and a sense of social consciousness. To achieve these aims and to correct the present aberration, we should examine the school curriculum as well as the school examination system and to make rectifications. The setting up of the Curriculum Development Institute of Singapore is a bold and correct step in this direction. The Institute has a great responsibility in the future development of education of our nation. The allocation of $10 million in respect of the Main Estimates and $4 million in the Development Estimates for this Ministry can be said to be quite substantial. I hope we will see good results and performance.

Let me now touch on the Culture budget briefly. This year it totals $43 million. It is only a mere 0.3% of the total national budget. This amount is really insignificant. As we know, the Culture Ministry is in charge of information, cultural activities and broadcasting. The importance of these functions cannot be measured in terms of money. In recent years, our economic, industrial and commercial developments have made great strides forward. The living standard of our people has also been raised. When social mode and living styles are changing, culture appears to be the more important. All along, we have been stressing on inheriting the cultural heritage of the four main language streams and the various ethnic groups, but in fact our people are not very active in the field of culture, Singaporeans, in general, read very little, rarely take part in cultural activities, and are usually lacking in cultural cultivation. Cultural workers also do not receive the status and the support they deserve. This may be the result of our education system - attaching too much importance to certificates. Our cultural development has not caught up with our economic development over the decade. Of course, the Ministry of Culture cannot be blamed for the backwardness of our cultural level. Nevertheless, the authority concerned should redouble its effort in the promotion of culture. Only $4 million is allotted for cultural activities. This means that each Singaporean will have a mere share of $1.70 which is inadequate for any cultural purposes. I hope that the Ministry of Culture will plan more activities in the coming year and that the Ministry of Finance will also provide more funds in the Budget.

Sir, I support the Motion. 8.00 p.m.

Mr Speaker: Order. Moment of interruption. Dr Tan, debate to be resumed on what day?

Dr Tony Tan Keng Yam: Tomorrow, Sir.

Mr Speaker: So be it.