MAIN AND DEVELOPMENT ESTIMATES OF SINGAPORE FOR THE FINANCIAL YEAR 1ST APRIL, 1984 TO 31ST MARCH, 1985

2.53 pm

Order read for resumed consideration in Committee of Supply [6th Allotted Day].

[Mr Speaker in the Chair]

Head R (cont) -

Resumption of Debate on Question [19th March, 1984],

"That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RA-01 Object Group 1100 of the Main Estimates." - [Mr Lim Boon Heng].

Question again proposed.

The Acting Minister for Labour (Prof. S. Jayakumar): Mr Speaker, Sir, when we adjourned yesterday, I had replied to the first of the three points raised by the hon. Member for Whampoa and was in the midst of the second point concerning different rates of interest. And I had then explained that this proposal had many ramifications which the hon. Member would appreciate. First of all, if the interest on the CPF is raised above 6 1/2%, it will have an impact on the price of HDB flats as well as the interest rate payable on loans from HDB. The HDB does borrow substantially from the Government to fund its housing programme. The Government in turn depends on CPF funds. If the CPF interest rate were to be raised above 6 1/2%, the Government would have no alternative but to raise the cost of money to the HDB. The HDB in turn may have to adjust the prices of flats to take into account this increase in the cost of funding. Furthermore, the interest rate on the loans that it gives to HDB flat owners would also have to be adjusted higher.

Since the Member referred to the lower income group, it may be pertinent for me to point out that those in the lower income group do benefit through subsidies that they may enjoy on the HDB flat. And apart from this, they also enjoy the subsidies from the loans that they take out from the HDB and the interest rate payable on these loans is 6 1/4%. In fact, I am told by the CPF that some CPF members chose to borrow the maximum amount allowed although they may have funds in their Ordinary Account because the interest rate on the loan is 6 1/4% and leave their own CPF savings in the Ordinary Account to accumulate at a higher interest rate.

Of course, there are other points to be made. For instance, it would be difficult to differentiate between different groups because as far as the borrower of funds is concerned, the monies are the same, whether they are from the lower income group or the higher income group. In the ultimate analysis, the proposal in short has considerable complications and ramifications. And the Member for Whampoa would appreciate that CPF savings are a very safe form of institutional investment and for the level of safety, the interest rate is certainly very attractive.

Mr Speaker, Sir, may I go on to the third point mentioned by the Member for Whampoa concerning the marriage restriction policy. I noted that he said he and other MPs received appeals from constituents where their applications for marriage with work permit holders were rejected. I understand the concern expressed and I am aware of this because I am also an MP and I also get appeals from some of my constituents. Perhaps this is a useful opportunity for me to very briefly explain the reasoning and the policy concerning marriage restrictions with work permit holders.

Our starting point, Mr Speaker, Sir, is really that we have, as mentioned the other day, about 150,000 foreigners on work permits. There are certain important considerations which are fundamental. First, these foreign workers are here for a specific purpose. They are here for execution of certain jobs. Second, they are here for a temporary purpose and it was never intended that they should be here permanently or to sink roots. Thirdly, the vast majority of them would not have been allowed into Singapore for any extended or long periods of time under the normal immigration policy. It is the immigration policy which is the vehicle through which we determine who comes in, who stays for a long time and who can have permanent residence. This large group of work permit holders are therefore persons who would not have been allowed to come in under the immigration policy and they are here therefore under the work permit policy designed for a very specific purpose. They are therefore not here under the normal immigration rules. 3.00pm

Secondly, Mr Speaker, Sir, we have studied the experiences of the European countries which, as Members know, are facing very serious problems with their foreign workers who came and stayed. They are very serious problems. I understand that today there are more than 13 million foreign workers in Western Europe living there with their families, and in the host countries where these foreign workers are situated, the foreign workers' population ranges between 5% and 17% of the total population. We have made a study of the experiences and problems in these other countries to make sure that as far as is possible we do not encounter the same pitfalls.

We have come to the conclusion that one of the major reasons why the Western European countries have this residual problem of foreign workers is that they allowed the foreign workers rights to bring in their dependants. Secondly, they granted the foreign workers rights of residency. Right from the beginning when we allowed foreign workers to come to Singapore under the work permit scheme, we have been very conscious of this and therefore have been very strict in not allowing the work permit holders to bring in their dependants. However, having been strict on them, if on the other hand we have a liberal policy of allowing the work permit holders to come here to sink roots through marriage, then we will have similar consequences. Large numbers of foreign workers will be here indefinitely or permanently, and sink roots when it was never the intention. In other words, without a strict policy on marriage between foreign workers and locals, our entire immigration policy can be negated and undermined. It is for this reason that we have to be very strict. This is not something which has been introduced suddenly.

More than 10 years ago, as early as 1973, the policy on marriage restriction was spelt out and announced, and work permit holders and the local population, Singaporeans, were, in fact, put on notice of our strict policy. If a foreign work permit holder, therefore, knowing the conditions, violates the policy, then he will be repatriated and various disincentives will apply. For those who nevertheless violate the policy, we must take appropriate action as spelt out in the 1973 press statement.

Of course, when we get appeals from constituents to MPs, there is a considerable misconception and misunderstand- ing. Some feel that after three years or five years' stay in Singapore as a work permit holder, one has automatic right of residence, or one has automatic right to marriage. This is not the case. In fact, our policy on approval of marriages must, of necessity, be strict. In fact, the policy is, and should be, not to approve marriages unless there are very good reasons related to the skills on the work permit holder concerned. This may sound harsh. I know I would become more popular if I were to liberalize the work permit restriction policy. However, it will not be doing Singapore any good if I were to do so.

Dr Augustine Tan: Sir, I would like to react to the comments by the Minister on the interest that the CPF pays to its depositors. I do agree with him that the HDB home owners benefit tremendously from the low prices of flats and also from the 6 1/4% interest that is payable on the loans given to them. In fact, this is quite unheard of in the world to have a rate of interest as low as 6 1/4% for 20 to 25 years. To get a fixed interest loan nowadays is impossible to get anywhere, even less at 6 1/4%. If one has to get a commercial loan, one would have to pay 10% to 11% or so, and this interest rate would be adjusted from time to time.

Having agreed with him on this, I must still get back to my original point. Referring to the table which was presented by him to this House yesterday, comparing the tax-adjusted average 12-month deposit rate of commercial banks with the rate that CPF pays its depositors, he made the claim that for most years the CPF interest rate was in excess of this deposit rate. I pointed out that this was because he adjusted for taxes, and I was not sure which category of taxpayers he was referring to. The adjustment looks quite substantial. So I would assume that his remarks were pertinent or relevant only for middle and higher income groups, because the lower income groups certainly do not benefit as much as he says they benefit. In fact, I would believe that the commercial rate of interest will be higher than the CPF rate of interest for most years for these categories.

Why did I make my proposal on increasing the rate of interest payable by CPF? It is a very simple economic proposition, and that is this. When we make loans too cheaply at very low rates of interest, there is inefficient use of capital. And by allowing the CPF rates to be more in line with commercial rates of interest, Government departments, statutory boards, HDB and others which borrow these funds through the Government via the CPF would be forced to use their funds much more efficiently. So from a social point of view, it is desirable that we pay the commercial rate of interest so that nobody subsidizes somebody else. I may throw the very principle of the Government itself back at the Minister, that we do not believe in subsidy as much as we want an efficient system to operate. I suspect that there is a lot of wastage of capital because, through the CPF scheme and the unduly low rate of interest paid on CPF balances, a lot of projects are undertaken which are not quite as efficient as they might be.

Prof. Jayakumar: Sir, I have taken note of the points raised by the Member for Whampoa. As to the detailed computation of the table, the Member can rest assured that I would ask the CPF to supply him with the details as to how the tables were computed. In the ultimate analysis, Sir, there may be a point of diminishing returns to comparing the CPF rates completely with the commercial rates because there are so many elements of the CPF scheme which are not comparable. In addition to the tax adjustment, for instance, we must also take into account a third factor, that is, the contribution by the employer in fact goes towards the gross sums available to the employee but yet it is not treated as income for income tax purposes, If you take that into account, it would be even more attractive. There are other factors such as estate duty exemption and also the fact that the sums in the CPF balance are not attachable for debts, and so on. So there are many other factors which have to be taken into account.

Mr Lim Boon Heng: Sir, in view of the Minister's cogent answers, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr Yeo Toon Chia (Ang Mo Kio): ( In Mandarin): Sir, I beg to move,

That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RA-01 Object Group 1210 of the Main Estimates.

Sir, ten days ago we learnt that the CPF Board had once more relaxed its ruling to allow home owners of middle and upper income groups to use their CPF savings again to buy a better home or another property. I am not against this. Sir, I feel that if the Board can allow such members to buy a second flat or even sell their property, then why does it not allow members of middle and lower income groups to use their savings for their children's higher education?

Sir, education is the basis on which to build a nation. Every year, the Education Ministry is getting a lion's share of our national budget. We know it is necessary because we do not have natural resources. Our only resource is our people and we know that by proper nurturing, providing our younger generation with good education and skills, we are making a good investment in our human resources, equipping them with the wherewithal to our nation's prosperity and progress. Yet, every year we are denying a good number of our younger generation the opportunity of having a higher education.

Sir, I am referring to those students who are bright but, because of financial difficulties, are not able to pursue a higher education. These are the students who are good enough to be admitted into tertiary educational institutions but not outstanding enough to qualify for a scholarship to complete full tertiary education. It is indeed sad to see that these students who have the abilities to acquire higher and better education but, because of lack of money and poor family background, are not able to do so, much to the regret and sorrow of their parents. It is ironical that their parents have the funds in the form of CPF savings but cannot be used for their children. Other students from wealthier families on the other hand are better able to acquire tertiary education.

Sir, the Government has always emphasised the importance of educating our young and the subject of getting the best education for the children has always been close to the hearts of parents. Every parent is concerned about his or her children's education and future, and they are prepared to suffer and sacrifice in order that their children could have a better education for a brighter future. They have high expectations of their children, hoping they would not be like themselves having to toil for a meagre living. I hope the Minister will realize the feelings of the majority in the middle and lower income groups and consider allowing them to use pan of their CPF savings for their children's tertiary education, as a way to nurture talent for the country. To prevent CPF members misusing the funds for other purposes, may I suggest perhaps the Institutes of Higher Learning can have direct arrangements with the CPF Board to deduct the amount needed for schooling direct from members' funds. I hope the Minister will consider this request and help to solve this problem of such parents. 3.15 pm

Mr Eric Cheong Yuen Chee (Toa Payoh): Sir, may I speak on my amendment now on the Central Provident Fund Act?

The Chairman: Which amendment?

Mr Eric Cheong Yuen Chee: Amendment No. (12).

The Chairman: All right.

Mr Eric Cheong Yuen Chee: Thank you, Sir. I propose to raise the following points for discussion on the Central Provident Fund Act.

Over the years, certain provisions of the CPF Act were progressively amended to take into account changing circumstances. For example, CPF members were subsequently permitted to use their balances to purchase private properties. One important amendment was the provision to set aside a minimum of 50% to the widows of members irrespective of the amount to be paid to other nominees. On this note, I would enquire whether the Minister would consider looking into the feasibility of introducing an optional annuity scheme for CPF contributors. For instance, a contributor may withdraw part of his CPF balances on retirement and leave the rest in an annuity account. This will protect contributors who for some reason or another are not in a good position to manage the large balances accumulated and they fall prey to irresponsible siblings, other members of the family or unscrupulous persons.

The next point I would like to raise is on the CPF Special Account. On 1st April this year, the balance in the Special Account will be transferred to the Medisave Account. After that date, 6% of subsequent contributions will also go into the Medisave Account. If the Special Account is to be discontinued, then it would be more appropriate for any sums in excess of $5,000 to be transferred back to the main account on 1st April, 1984 for the contributors to use for the purchase of HDB or private properties instead of waiting till a contributor reaches the age of 55 years.

The last point I would like to raise is on the relaxation of using CPF balances for the purchase of resale HDB flats which is not equitable with the benefits bestowed on those who are buying private properties. We should take into consideration a contributor's interest rather than on the type of property he purchases. To purchase an HDB resale flat, a contributor is only allowed to use up to 140% of the HDB posted price. For example, if the vendor's price of an HDB 5-room resale flat is $150,000 and the HDB's posted price is $97,000 in the inner urban area, the contributor can only withdraw $135,000 whereas a contributor can withdraw a much larger sum if he purchases a first or second private property. Under current HDB regulations, a contributor who purchases an HDB resale flat cannot buy a second property.

Prof. S. Jayakumar: Sir, first, may I deal with the points raised by the Member for Ang Mo Kio concerning the use of CPF funds for education. As Members will know, the CPF has over the years been imaginative in working out various schemes, such as the scheme to purchase HDB flats, Approved Residential Properties Scheme, SBS share scheme, the Home Protection Insurance Scheme and so on. But above everything else, the CPF and the Ministry have to bear in mind that the schemes that are devised must basically be safe investments which will preserve the value of savings, and should be hedged against inflation to safeguard the position of the contributor in times of misfortune. With this consideration in mind, therefore, the CPF has to be very careful, even at the risk of being conservative, to ensure that the various usages do not proliferate.

Although the CPF will not rule out other possible uses to which the funds can be put, I would state that we must have this over-riding consideration that whatever usages it is put to, it must not lead to an erosion of the savings, it must not be consumptive and must not, above all, lead to a situation where it could result in a premature withdrawal of CPF funds or premature assignment of the savings.

Using these yardsticks, I would have to disappoint the Member for Ang Mo Kio by saying that the Ministry is not able to decide that CPF funds can be used for educational purposes in the way that he mentioned. It is not really a question of abuse by the CPF contributor that he will take his money and not use it for the purposes of education but rather, it could lead to a situation where the sums spent on education would result in consumptive use of CPF money. Secondly, it will be difficult to supervise the usages of this money for educational purposes, particularly where the parent wants to send the child abroad for education. Thirdly, if the child does not succeed, then it would also have resulted in premature withdrawal or assignment of CPF funds. So attractive though the scheme may be, we have a responsibility to ensure that whatever schemes, including this proposal, do not lead to an erosion or premature withdrawal of CPF savings. For the time being, we have no intention of bringing about another scheme for using CPF funds for educational purposes.

If I may now turn to the points raised by the Member for Toa Payoh. The first point he made was whether we would consider an optional annuity scheme, and he raised the problem of contributors who for various reasons may not be able to manage large sums which they withdraw. This is indeed a real problem which we expect would increase as the years go by. I think the Member is in a sense prophetic because I understand from the Minister for Health, who is Chairman of the Committee on the Problems of the Aged, that the report of the Committee which will be presented to Parliament soon does address itself to this question amongst other things. Perhaps I should not steal the thunder from the Minister for Health and give him the honour of replying in greater detail to the Member for Toa Payoh.

As to the second point concerning the Special Account vis-a-vis Medisave, first, it is important for me to clarify that the Special Account will not be discontinued although on 1st April, 1984, the sums which are in the Special Account will be transferred to the Medisave Account and thereafter contributions which would otherwise have gone into the Special Account will be credited to the Medisave Account. The Special Account will continue to exist but will be dormant. It could be activated in the future if members' contributions and employers' contributions are increased. So it is not discontinued.

As to the other point that he made, the monies will be credited to the Medisave Account and will continue to be credited. There will be no maximum but upon reaching the age of 55, the sum of $5,000 will be retained in the Medisave Account. This sum, as has been announced in the press briefings and press statements, will be increased by $500 progressively up to the limit of $10,000. So when a person reaches 55 years of age, any excess beyond $5,000 or whatever limit up to $10,000 then prevailing can be withdrawn like the other sums in the CPF account which he can withdraw. With that clarification, I hope the Member's questions are answered.

With regard to the inequity that he sees in the rules concerning the use of CPF funds for HDB flats and approved private residential properties, perhaps I should explain to him, first, that the 100% figure was only recently revised to 140%. The answer to the question, "Why 140% and not any other figure?" is really to preserve the old-age savings which are invested in the HDB flat. Although they may buy the resale flat at the resale price, what is important is that these purchases are subject to the HDB rules in the sense that if they were to sell the flat back to the HDB within the period of five years, or for other reasons it is acquired by the HDB, then it will be at the posted price which means there is a serious question as to whether the amounts withdrawn from the CPF could be returned to the CPF account in the name of the contributor. In fact, it could be said that the CPF has taken a risk in increasing it from 100% to 140% in view of these circumstances.

Let me assure the Member for Toa Payoh that we have also done a survey which shows that the 140% figure is not significantly lower than the HDB prevailing resale price. Furthermore, a comparison with the private residential property scheme is not really inequitable when we take into account that for the approved residential property scheme the contributor can only use 90% of the Ordinary Account or 80% of the assessed value.

Mr Eric Cheong Yuen Chee: Sir, I wish to thank the Minister for his clarification especially on the retention of the Special Account. There is one fundamental change between the Special Account and the proposed Medisave Account. For instance, if you are going to take the case of a contributor who has reached the age of 55 years, I agree with his explanation. But what about those who are, say, in their early 30s or 40s who have sums in excess of $10,000 or $5,000 initially for 1984? Then you find that there is a fundamental change because a person will get the balance in the Special Account in cash on retirement. But if this is transferred lock, stock and barrel into his Medisave Account, he will not be able to get this money on retirement but only upon death to his next-of-kin. That is the difference.

Mr Yeo Toon Chia: ( In Mandarin): Sir, let me clarify. A moment ago when I was referring to education, I was not referring to primary or secondary education. I was referring to tertiary education. The Minister's answer was consistent with his predecessor. His contention was that CPF money must be used for sound investment and the best investment. If they were to use the CPF contributions for investment in private properties two years ago, then are they making good money now? Would that be a sound investment? And for those who bought SBS shares, is it the best and sound investment? I believe we can all figure out for ourselves. It is not so.

I feel that we must give more consideration to the aspirations of the parents in the lower or lower middle income groups. There are enough savings in the CPF for them to send their children to the university. Of course, we can restrict them by allowing sending their children only to local institutions, our National University of Singapore, the Singapore Polytechnic, the Ngee Ann Technical College or the Nanyang Technological Institute. If their children can be enrolled in these tertiary institutions, then they must have attained certain standards. Even if they cannot graduate at least they would be able to complete one or two years of study in these institutes.

My colleague, the Member for Delta (Mr Yeo Choo Kok), has stated that once the students are enrolled in the tertiary institutions, they would be in a better position to marry another undergraduate. Then they would be in a better position to give birth to children of better quality. There is another point. If the children are desirous of going to work after completing their tertiary education, then they would be in a position to repay the money to the CPF. Even the parents in the lower income group or lower middle income group would be willing to do so for the sake of their children. I hope the Minister will consider this point. For a better future generation, the Minister should consider the aspirations of the people from the lower and lower middle income group.

Prof. Jayakumar: Sir, first, to reply to the outstanding point of the Member for Toa Payoh. If I am not mistaken, he was speaking on the assumption that the sums in excess of the limit that has to be maintained in the Medisave Account cannot be withdrawn until death and passed on to the next-of-kin. This has to be corrected. This is not the case. From the information that I have from the Ministry of Health officials, the intention is really that he must keep a limit which is now $5,000. It will be raised progressively by $500 to $10,000. Any sums in excess of that limit upon reaching the withdrawal age can be withdrawn like other sums in the account which can be withdrawn.

As regards the point raised by the Member for Ang Mo Kio, I should add that, in addition to the point that I have mentioned, we have looked at the affordability of eligible students going to tertiary institutions, and we are satisfied that for any student who is deserving, who has got a place in the university, there are ample scholarships and bursaries for him to go to the university. I believe he made a variation of his point that some students may be able to go to the university but they are not of such a standard and are likely to drop out after one or two years. I would really have very strong reservations about using our CPF funds for persons who clearly are not going to make it. Although he advocates the utility and benefits which may be derived by persons being in the university for one -or two years, I do not think that we should even begin to think of the CPF scheme as a scheme for matrimonial purposes or as a scheme for dropouts in the university. With this additional point that there are ample bursaries, scholarships and financial assistance, I hope that, though the reply may be disappointing, he will understand the reason for the CPF to be prudent and conservative.

Mr Yeo Toon Chia: ( In Mandarin): Sir, what I mean is this. Our Acting Minister for Labour is a Professor in the National University of Singapore. Perhaps he would be able to provide me with statistics to show how many per cent of the undergraduates could not complete their tertiary education. In his reply the Minister has said that we should not abuse this money in unnecessary investment. But for the parents to send their children to the university, is it not the best investment? If the parents do not think so, then such parents would be looked down upon by others. I was saying that even if we take the worst case, they should at least be able to complete one or two years in the university. For most of them who are qualified for enrolment into the university, they should be able to complete the university education.

I do understand that there are quite a lot of scholarships and bursaries available even in our many constituencies, but if the standard of the students is not exceptionally good, they would not be able to qualify for the scholarships. What about those who are accepted for enrolment into the NUS, the Nanyang Technological Institute or the Ngee Ann Polytechnic but could not afford the fees? Maybe for the rich, $1,000 or $2,000 is nothing. But to the poor people $1,000 or $2,000 would take one or two months to earn this money. They would need the money for their household expenses. They would not have excess money to send their children to the university. I hope the Minister would consider this.

Prof. Jayakumar: Sir, I have already spelt out the over-riding considerations which must govern the introduction of any new schemes for the use of CPF funds. So I will not repeat that. Suffice it for me to say that if the Member for Ang Mo Kio is aware of students who have been admitted or granted a place in any institution of higher learning, but are not able to use the opportunity because of lack of funds, I together with my colleague in the Ministry of Education, the Minister of State for Education, would be happy to look into the matter. But I have looked at the figures and looked at the different types of schemes, and I am satisfied that for those who make the grade and are admitted to institutions of higher learning, there are ample opportunities, scholarships, bursaries; for them and, therefore, the situation does not warrant the introduction, at this point of time, of the scheme I mentioned. I have noted his points and his reasoning. They are not without substance, but before we make such a major scheme we must be satisfied that existing other means which are available have not been exhausted.

Mr Yeo Toon Chia: ( In Mandarin): Sir, I thank the Minister for giving us the assurance that the students would be able to complete their university education. Since he does not want to consider my point, I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Dr Ow Chin Hock (Leng Kee): Sir, I beg to move,

That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RA-01 of the Main Estimates.

Before I begin, Sir, I would like to support the view expressed by my colleague, the Member for Ang Mo Kio, regarding the withdrawal of CPF funds for educational purposes. I have raised this matter before and I must say that I am disappointed with the Minister's reply. One correction about the Minister's comments or his reply. He said that such a withdrawal was for a consumptive purpose. I disagree. In fact, education is an investment in human capital and, like all investments, there is always a risk involved.

Let me now turn to the more general point - labour force. The most serious domestic constraint on our future economic growth will be the supply of labour. Without immigration, increase in labour force has to come from two sources: (1) population growth, and (2) increase in labour force participation rate.

Our population growth rate has declined to 1.2% per annum since 1980. Sometime ago, the Ministry of Health projected that we will reach zero population growth in the year 2030 with a maximum population size of around 3.5 to 3.6 million. This projection was based on the assumption that the net reproduction rate is equal to 1.0 and will be maintained around that level. However, since 1975, the net reproduction rate has fallen below 1.0 and has been declining progressively. In 1982, the net reproduction was only 0.79 or some 20% below replacement level. If this trend persists, our population will peak at about three million around the year 2000, and after the year 2000 our population will begin to decline. This is the most pessimistic projection I have ever learned. If this happens, it will have very serious implications or effects on our labour force and military manpower requirements. Perhaps, there is a need to review our population and family planning programmes.

I understand that these programmes are not under the portfolio of the Minister for Labour, but I urge him to raise this matter with the Minister for Health and the Minister of Defence.

Next, labour force participation rate of our older workers. The additional domestic supply of labour could be obtained by extending the retirement age to 60 or 65 years of age. There were 62,128 retired workers and pensioners in 1982. According to the 1980 population census projection, if the retirement age were extended to 65, about 44,000 more workers would be retained in the labour force. In view of the ageing population and the fact that more and more young people are entering the labour force at an older age (in fact, the participation rate of 15-19 age group has been declining from 49% in 1980 to 43% in 1982), there is a strong case for the Ministry to consider extending the retirement age to 60 with the option to go on to 65 in both private and public sectors. May I ask the Minister to consider this?

However, the most significant increase in labour supply will have to come from the increase in female labour force participation rate. According to the Report of the Labour Force Survey 1982, the participation rate among females aged 15 years and over, has been increasing continuously from 40% in 1978 to 45% in 1982. This rate is higher than Taiwan, West Germany, France and Switzerland but lower than Japan and the United States. In this context, may I recall what the Prime Minister said on 15th February, 1984: "do our women need to value their careers more than, and at the expense of, their families?" Similarly, we should ask ourselves: "Should we further increase our female labour force participation rate for the sake of more rapid economic growth, or should we encourage more women to stay at home to look after their children and bring them up properly and perhaps to cook, as the Member for Whampoa would suggest?" Nursery schools and child-care centres are no substitutes for home. And there are limits to part-time work, piece-work and shift-work. In 1982, there were only 12,100 female part-time workers and 47% of them had no qualifications whatsoever. May I ask the Minister to comment on this dilemma? 3.45 pm

Finally, Sir, if we cannot increase the quantity of our labour supply substantially, then we have to improve the quality of our work force. Hence, we have no choice but to press on relentlessly to increase our productivity. The labour productivity growth rate in 1983 was 5.2% and I trust this figure to be accurate. It is a vast improvement over 1.1% in 1982. However, we must take note that this productivity growth rate still falls short of the targeted productivity growth rate of 6-8% per annum. Moreover, part of the increase in productivity in 1983 was due to the hoarding of labour by employers during the recession in 1982 in anticipation of an economic upturn.

Nevertheless, in this context, I would like to commend the National Productivity Board for its efforts in promoting greater awareness of the importance of productivity. The productivity message was brought home through soft-sell packages including posters and TV commercials such as "Teamy" and "Come On Singapore". Teamy, the hard-working bee, is effective in getting the productivity and teamwork message across. Sir, I notice that Teamy even appeared in the Workers' Party's publication, Hammer. This speaks well for the NPB. On the other hand, the latest TV productivity message, "Come On Singapore" is now known as "Come On Singapore Handiplast", simply because it reminds people, particularly our students and children, of the TV commercial on the Handiplast plaster. So may I remind the National Productivity Board, to be productive it has to be creative and imaginative.

Mr Rohan bin Kamis (Telok Blangah): Mr Speaker, Sir, before I speak on the topic of part-time employment for housewives, may I reiterate the plea of my colleague who is not here, the Member for Whampoa, when he called for more information from Ministries. I found that in particular, the Ministry of Labour is one of those Ministries which have produced an annual report. I know that a few other Ministries have done so. This is commendable and I hope that all Ministries would follow suit and take note because it would be strange for Ministries of Communications and Education not to have annual reports which could be useful to both Members of this House and members of the public to acquaint themselves with what the Ministries are doing especially. Maybe these Ministries should learn how to communicate better.

Sir, in February 1979 during the debate on the President's Address, I was pleased to note that in the Addendum of the Ministry of Labour, the Ministry was to cater for more part-time employment opportunities for housewives to alleviate the labour shortage. I am all for it because if we want housewives to have more children, we should cater for the situation when their children have grown up and when these mothers could spare pan of their time, they would wish to use their skills and talents to contribute to the country's economy again. This scheme may help to overcome boredom for some.

However, in the latest report of the Ministry of Labour, I note that the pilot programme did not receive a good response. Sir, I quote:

'Only three housewives accepted part-time jobs. The others declined the part-time jobs available on the grounds that the nature of work, working hours or location of the company were not suitable.'

I feel that the Ministry of Labour should not give up and must press on. Here, the usual Singaporean touch of ingenuity and resourcefulness is required. Maybe the concept need to be repackaged to be more attractive and worthwhile to attract these mothers into our labour force again.

Furthermore, Sir, I feel that the Government should take the lead with its Government departments, statutory boards and, more importantly, the numerous Government-owned or Government-controlled companies. This would give the impetus for other employers to follow suit if the Government with the prompting of the Ministry of Labour would set the tempo and the tenor of this project. In short, all in all, the Ministry of Labour should not only be in constant labour but must also deliver. Would the Minister please comment?

Prof. Jayakumar: Mr Speaker, Sir, first, may I take up the point raised by the Member for Leng Kee concerning retirement age. I am in complete agreement with him that it makes good sense for us to think in the direction of increasing the retirement age. He has given certain reasons such as increasing life span and of population. Of course, there are also reasons of medical science which show that people who are gainfully employed will lead healthier lives and if indeed people are gainfully employed till an older age, they will be of course more financially secure and less dependent on the State. But above all, as he has pointed out, in a tight labour shortage, getting more people to work later would be eminently sensible. So he has brought up a very valid point.

The question, of course, is how is this to be done. Should it be compulsory? My response to that would be that it would not be wise to legislate a compulsory retirement age of 60 or 65 for not all jobs may be suitable for persons of such older age, either due to physical or mental conditions. Some jobs may require keen eyesight or physical dexterity and so on. So the key criterion must be whether the worker and his increased age would be suitable for the kind of job he is doing. Productivity and skills must be the overriding consideration.

So it may not be a wise idea to compel employers to retain all their workers, even though they may not be able to effectively deploy them as it will lower productivity. So it would be best for us to leave this to be negotiated between employers and employees. This would be more flexible. It would bring about an increase in retirement age selectively for jobs which are suitable for absorbing older workers.

I might add here that this question of increasing the retirement age will also be one of the matters to be addressed in the report of the Committee on the Problems of the Aged which will be presented shortly to this House. So I thank the Member for his comments. They are pertinent and timely. And the Government will be looking into this very seriously.

As regards his point on increasing the female labour participation rate, he is quite correct in that this is another way to solve the problem of labour shortage. As he has pointed out, the female labour force participation rate, compared to other countries, is quite high. There may be some scope to increase it even further. But he has put a finger on the correct question, i.e. will there be a social cost? And I think the answer, as he has indicated, is that there must be a social cost. When it comes to married women with young children working full-time, it will inevitably affect their ability to give that much care and attention to inculcate the right values amongst the children. There are some who may be able to cope both with a full-time job and with raising of young children, but not all can. For those who cannot, perhaps they should stop working while the children are young and rejoin the labour force when the children are older or to do part-time work.

I am glad to inform the Member that the statistics do show that the labour force participation rate among women between the ages of 30 and 44, and therefore the category which is likely to be those who are returning to work after a period of marriage and child rearing, is increasing each year. For example, in 1979, this age group between 30-34, the rate was 40.8%; in 1983, the rate was 48.5%. For the age group, 35-39, in 1979, the participation rate was 37.7%; in 1983, it was 44.7%. So there are hopeful and positive signs to show that the number of women who come back to work after a period of time may be on the increase. But in the ultimate analysis, getting more women to work, of course, is not the answer. Here again, I agree with him that our long-term solution must be to reduce reliance on manpower and to upgrade, mechanize and to emphasize that economic growth is tied up with productivity.

I am grateful to him for the encouraging words he has mentioned about the productivity efforts undertaken by the NPB. But I wish to stress, of course, that while NPB is a catalyst, a(l sectors of our society would have to be involved.

Turning to the points raised by the Member for Telok Blangah concerning the Ministry of Labour's part-time employment scheme, we do have, as he has mentioned, the part-time employment assistance scheme whereby wives seeking pan-time jobs are matched with vacancies. We have actively encouraged companies to provide part-time job opportunities with suitable working hours and attractive pay. Some companies have been successful. Whether they succeed in attracting a significant number of women to work part-time really depends on the scheme, the flexibility and the attractiveness. Some firms are more successful, are more imaginative than others. Obviously, in a tight labour market situation, we would expect the women also to be quite choosy which explains the figures that he mentioned. But let me just mention that, here again, the signs are encouraging. In 1982, there were 12,100 females in part-time jobs. In 1983, there were 16,000 females in part-time jobs. Probably the figure is higher. Many are engaged in tuition, music classes, child-care, who for fear of tax or other disclosures might not have given appropriate returns to our service. 4.00 pm

As I said, it depends on the scheme worked out by the company. Some companies are successful. For instance, one company had, in fact, a housewife shift from 6.00 pm to 11.00 pm. This will enable the woman to go to the company or factory after the husband has returned. She would therefore not be inhibited or be preoccupied with the question as to who is looking after the home and so on. So it really depends not just on the Ministry of Labour encouraging employers but it also depends on the kind of schemes which employers themselves devise. I will assure him that this is a matter that we will continue to look into.

In closing let me say that the National Productivity Council also has a task force with representatives from the NTUC, employers and employer groups looking into this question, and we hope that early next year they would be able to present a report on this topic.

Dr Ow Chin Hock: Sir, I am very grateful to the Minister's reply. He has quoted certain figures, the female labour force participation rate for the year 1979 as compared to 1983. What I am looking at is cross-sectional data. I do not have the figures for 1983 but I have the figures for 1982. He may take note that the female labour force participation rate increased very rapidly from the age-group 15-19 to the peak of 79.4% for the age-group 20-24; and after that it declined continuously to 10% for the age-group 60-64. This implies that many married women do not re-enter the labour market. So I do not know whether the Minister for Labour may like to look into the terms and conditions of employment for older workers so as to encourage women, particularly better educated women, to re-enter the labour market when their children are older.

Prof. Jayakumar: Sir, very briefly let me say that I have taken note of the point just expressed and certainly I will ask my officials to give this matter serious consideration.

Dr Ow Chin Hock: Sir, in view of the Minister's reply, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr Goh Chee Wee (Boon Lay): Sir, I beg to move,

That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RC-01 of the Main Estimates.

Sir, in moving this amendment, I wish to comment on two issues which concern trade unions and industrial relations.

The first issue is the subject of yearly authorization for check-off of union sub- scriptions. Under section 27 (1)K of the Employment Act, the Minister for Labour is empowered to approve deduction from the salary of an employee under the check-off scheme in respect of the payment of union subscriptions and contributions. The check-off scheme has enabled the union to collect the union subscriptions through the deduction of the fees from the salary of its members. However, the approval for check-off granted by the Minister is, so far, subject to the condition that written authorization from the union members for such deductions must be obtained yearly. In other words, every year the union officials have to go around asking the union members to sign authorization forms.

While the check-off scheme has facilitated the collection of union subscriptions by the trade unions, the requirement of annual authorization by union members has imposed a tremendous administrative burden on the unions. At the moment the total number of workers represented by the NTUC's affiliated unions is around 200,000. One can imagine the administrative work and the time involved in getting 200,000 members signing the authorization form each year. As a matter of fact, the exercise is highly unproductive and time-consuming; and very often it disrupts production at the work place. The union has to make arrangement with the employers to release the workers to sign the check-off forms, and generally the employers would not like the union officials to walk round the production lines to explain to the workers and to ask the workers to sign the forms. At a time when we place so much emphasis on productivity and the cutting down of unproductive practices, I believe the present requirement of annual authorization by members for check-off is most unproductive.

I believe the main reason that the Ministry of Labour has insisted on annual authorization is that a union member must be given a chance to indicate whether he wishes to continue as a union member, hence his explicit permission for deduction of union subscription must be obtained at periodic intervals. My question is, why does the Ministry insist on written authorization on an annual basis? Why can't the Ministry require authorization only once every two or three years? Many licences and permits issued by the Government are valid for more than one year. For instance, we do not renew our marriage certificate once a year. Can we argue that for the interest of the husband and wife, the wish of the couple to remain as husband and wife must be ascertained once a year?

Talking about protecting the rights of the workers, I am sure the Minister is aware that under the constitution of the unions, a worker can resign from membership of the union by giving three to six months' notice. A worker can exercise his right to resign from the union any time irrespective of whether the written authorization for check-off is in force or not. Furthermore, the Minister also reserves the right to revoke the check-off scheme if there are abuses by the union.

Sir, I really hope the Minister for Labour would, in the name of productivity, seriously consider the request to extend the validity of the authorization for check-off to a period of more than a year, preferably two or three years.

The second point I wish to raise, Sir, is something which concerns the employee's eligibility for paid sick leave. Under section 43(1) of the Employment Act, only employees who have served an employer for a period of not less than 12 months shall be entitled to paid sick leave. An employee who has served less than one year is not entitled to any paid sick leave, even if he is confirmed in his employment. There have been suggestions raised in Parliament that the provision be relaxed to allow all employees who are confirmed in their employment to be entitled to paid sick leave, but the suggestions seem to have fallen on deaf ears. With our present emphasis on company welfarism and the call to employers to take care of the wellbeing and welfare of the workers, I hope the Minister would review the matter again to allow all workers who are confirmed in their employment to be covered by the relevant provisions of the Act in respect of the granting of paid sick leave.

What is even more disturbing is the attitude of many employers towards their female employees when it comes to taking time-off or leave to consult the doctor during pregnancy. The Employment Act stipulates that the employer shall grant a total of eight weeks' paid maternity leave to female employees. For many of the female employees in the private sector, this is about the only benefit that they are entitled to for childbirth. Let me explain. Under the collective agreement signed between the union and the employer, usually the employer undertakes to pay for all medical expenses including hospitalization, ward charges, operation fees, etc. The benefit is extended to cover all illnesses or accidents. But in most of these collective agreements, the employer insists that the provision for medical benefits should not cover medical expenses arising from pregnancy and child delivery. In other words, not only does the employer refuse to grant paid leave or time-off to female employees when they go for pre-natal check-up, but the company further refuses to pay for accouchement fees, ward charges and any other related expenses. Some companies even go to the extent of not recognizing medical certificates issued by Government hospitals for miscarriage, abortion or any illnesses arising out of pregnancy. Of course, there are some more enlightened employers who make payments to defray part of the expenses incurred in childbirth, but many are quite insistent that they are not obliged to do so under the Employment Act.

I would appreciate if the Minister for Labour would look into this matter and see how the employers could be persuaded to be more caring and sympathetic towards their female employees. In my view, treating medical treatment arising out of pregnancy different from other types of illnesses is a discrimination against female employees and work against the policy to encourage married women to stay in their jobs.

Mr J.B. Jeyaretnam (Anson): Sir, in sending in this notice of my amendment I intended to speak and I propose to speak on this promotion of house unions, which I understood from the Acting Minister for Labour in the sitting of this House on the 17th of January that the Government was very anxious to promote. I also understood from the Acting Minister that there was no question of house unions being forced on members, on the working population, but that they would be given every opportunity to decide for themselves. I asked then whether their consent or otherwise would be taken by a secret ballot. The Minister's reply was, "Yes, if it is provided in the rules. But it depended on the constitution and the rules."The Minister went on to say that he thought that my allegations about unhappiness was wild and unfounded; unhappiness, that is, among workers on the active promotion of in-house unions.

Sir, I understand that particularly in one union there is a lot of unhappiness about this promotion of the in-house union, and this union is the Singapore Air Transport Workers' Union. Not only have I heard from members but there was a letter which arrived at my table, copied to me. I think it was directed to the Prime Minister and a number of others, and I was on the circulation list, This man had a long complaint about the unhappiness among the members of this union, and I gathered it all arose because of the attempt to break this union up now into house unions. 4.15 pm

Sir, you are probably aware that this union comprises workers not only in the Singapore Airlines but in three other companies which serve the airline industry. I am told that it is the envy of a lot of unions because, whilst other unions lament about their membership, this union has a 98% membership. I further understand that in 1981 there was a study of this union made by civil servants and NTUC officials and I understand that they reported that this union was being run on an in-house concept and had excellent relations. But now suddenly the members find that they are being pressured into breaking away into smaller unions. I understand that they had been visited by advisers who are also Members of this House, from the NTUC headquarters, who have been actively trying to persuade them into accepting the break-up of their union into smaller in-house unions.

Not only that, I understand that pressure has been brought to bear on them from the company where they work. Several principal union officials who were earlier given time-off from their duties to attend to their union affairs, I understand, have now been ordered to go back to work and have been told that they cannot have time-off from their duties in their employment to attend to union affairs. I also understand that the General Secretary of the Union was offered a chance of being transferred to the administrative service, and when he was appointed General Secretary he was told they would keep the option open for him for three years until he had served his term. But I understand lately that he has been told that he has got to exercise his option as soon as possible and they were not prepared to wait. The members see in all this a subtle pressure being brought to bear on them to accept the break-up of their union into smaller in-house unions.

Sir, we must recognize the principle of self-determination, whether it is self-determination by the citizens in the affairs of the country or whether it is self-determination of the workers in the unions. And the only way that you can determine the views and opinions of the workers is to let them freely, without any pressure being brought to bear on them from anybody outside the union, make up their minds calmly, listening to all the pros and cons of any question put to them and deciding freely without any pressure whatsoever; and that decision must be made, if possible, by every member and according to the method of ascertaining the views of members as provided in the constitution or rules. I see that there is provision in the union's constitution for the holding of a secret ballot on a number of matters that concern the union.

May I ask from the Minister an assurance that there will be a secret ballot taken from these members before they are forced to accept a break-up of their union into smaller unions?

Sir, I have in my question in the sitting on 17th January, 1984, pointed out that if you break up a union into smaller unions then you automatically deprive some of the unions of the leadership that they enjoy and you fragment the unions. We were told by the Minister for Finance and Minister for Trade and Industry that it is the Government's policy to promote direct wage bargaining between the unions and their employers, and I asked how does he propose to give the unions the power. If you now go ahead with fragmenting the unions, you are weakening them more. If you want to get any productivity out of the workers, then you have got to respect their rights and give them the necessary strength to conduct their own affairs and to determine their own affairs and not be pressured by others against their wishes. There is yet another union ---

The Chairman: Your time is up, Mr Jeyaretnam.

Mr M.K.A. Jabbar (Radin Mas): Sir, can I speak on the same subject?

The Chairman: Is it your Amendment No. (6)?

Mr M.K.A. Jabbar: Yes.

The Chairman: All right.

Mr M.K.A. Jabbar (in Tamil): Sir, although I have an amendment under Subhead RC-02, I wish to speak now because it is on the same topic under discussion.

I am pleased to be able to speak on the estimates of the Ministry of Labour. I welcome the annual check-off authorization system. Trade unionists have to make great sacrifices because of their full support to the Government and the National Trades Union Congress. In the course of this, if by chance, we are unable to solve the problems of the workers we lose some long-term serving members. As an alternative, may I suggest to the Minister that the Ministry consider extending the validity of authorization for check-off for the duration of the collective agreement.

Sir, there is an important reason for the reduction of membership in the affiliated unions of the NTUC. When we accept the Government's proposals and work on the recommendations of NTUC, members as well as non-union members receive equal benefits, such as promotion, wage increases and other social benefits resulting in dissatisfaction amongst members. Consequently, they begin to dislike the unions. Since non-members benefit as much and as equally as members out of the benefits obtained through the negotiations by unions, will the Minister for Labour consider introducing legislation in order that Government could collect a certain sum of money from the non-unionized members and transfer such amounts to the workers' joint welfare fund?

We have not been able to bring about the mandatory implementation of the NWC recommendations. For this reason, some selfish companies earn a good name by only giving good basic salaries. Because of this, neither the unions nor the NTUC have an opportunity to hold talks with the management on the implementation of the NWC recommendations. This makes the members suspicious of the unions. I think the managements ignore NWC recommendations. I wish to know whether the Minister for Labour will consider making suggestions to the employers to implement the Japanese-style management of according wage increases and promotions to workers based on the number of years they have served.

Prof. Jayakumar: Sir, may I first respond to the points raised by the Member for Boon Lay. He has raised two broad issues. First is the issue of check-off procedure, a point which was also touched on by the Member for Radin Mas. Let me explain, Sir, that although the Member drew an analogy between the relationship of husband and wife, I think the analogy is farfetched because the reason for the check-off annual authorization is really not intended to have an annual renewal of the union membership. The rationale is that the trade union funds are at stake. Members' contributions are at stake and we do not want a situation where once he has given the authorization that this authorization can then operate for an indefinite number of years. Therefore, it is important to ensure that the union has continuing authority to deduct and explicit permission is obtained at a regular interval.

By and large, many unions have been following the rules. Some have not and we have had to take action. But I take the point mentioned by the Member for Boon Lay and the Member for Radin Mas that this may lead to onerous burden on the part of the union officials in getting a large number of members to sign the forms annually. Of course, another reason is that this annual authorization also ensures that the union officials regularly maintain a close contact with their members. Indeed, in one case, I myself received expressions of gratitude where we had to enforce this annual authorization because the members said that once the authorization had been obtained they had been ignored for some period of time. Be that as it may, the point raised as to the burden of time and effort it imposes on the union officials, is one that I appreciate. This point has also been officially conveyed to us by the NTUC and I am glad to inform him that my Ministry is now reviewing this to see whether the intervals can be spaced out at longer durations and generally to look into the whole procedure for the authorization. I hope to be able to arrive at a definitive decision later. But I am glad to say that this is being reviewed.

With regard to the points made by the Member for Boon Lay concerning sick leave benefits, he knows that the fringe benefits, including medical benefits, have to be negotiated between the employer and employees. For the Government to intervene would be eroding the employer-employee nexus. 4.30 pm

He mentioned the qualifying period. The Ministry has taken note of his point and will consider it but he should note that most collective agreements already provide for sick leave upon confirmation. I agree with him that the attitudes of employers are important. They may be right within the letter of the agreement, but if they take a very cold, literalist and antiseptic attitude in the interpretation of the terms then, of course, this is not going to endear the workers to the company. This will make it more difficult for the company to retain the workers, more difficult for them to bring about feelings of company loyalty on the part of the workers.

While the Government will not intervene in these matters and leave it to the employers and employees to negotiate, I would urge employers to take note of the points he has made relating to the healthy attitudes taken by the employers.

As to the non-recognition of medical certificates issued by Government departments, this may be a matter which we should look into. If he could give us some examples, I can assure him that I will take this up with my officials and also with the Ministry of Health.

I have also taken note of the point raised by the Member for Radin Mas and will give it due consideration. As to the point he made about relative benefits between members of the union and non-members this was also adequately covered, if I remember, by the Minister without Portfolio, in an interview that he gave to the press, the points of which I am in agreement.

Sir, may I now turn to the points raised by the Member for Anson? He spoke about house unions. Members will recall that in my answer to a Question raised by the Member for Kampong Kembangan on 17th January, I did say, amongst other things, that:

'The Government will continue to strongly promote the formation of house unions in view of the positive contribution they can make to the enhancement of productivity. I must, however, stress that the actuai establishment of house unions must be left to the workers themselves and to some extent the management of the company. They must be convinced that the house union will serve their interest and objective of fostering a closer relationship within the company and thus contribute to its continued growth.'

Now, what has the Member for Anson really said in his 10 minutes? He has, for 10 minutes, spoken about one union, SATU. Am I right? SATU?

Mr Jeyaretnam: Yes.

Prof. Jayakumar: He has made a series of allegations that they are being forced to form house unions and a host of other allegations, including relations between the management and union officials. For example, he has said that the management has required some of the union officials who are doing full-time union work now to revert back to doing work for which they were employed in the respective company. I am also told now by the Member for Anson that the General Secretary of the Union was given an option for three years - so I understand from him - an option either to stay in the union or to join management. If I understand the Member for Anson correctly, lately he has been told that the General Secretary must exercise the option now. I find it incredible that a management has given a person an option to join the management for three years, and I am not at all surprised that any management would want a person to exercise the option after three years. In fact, I find it surprising that the option has been given for such a long time.

But really, Sir, what is the basis for the Member for Anson to come to this House to raise all these allegations, which come down to one word: that they are being "forced" to form a house union. Where is the basis and evidence for his allegations? The only evidence that he has mentioned for all the things that he has said in his 10 minutes is an anonymous letter that he has received. If I were to act on anonymous letters of all shades and kind that are on my desk every morning, including anonymous letters about the Member for Anson, I will not be able to do any other work. Really, I think we must advise the Member for Anson to grow up, to take things seriously. Does he really believe that a union, whether it is SATU or otherwise, can be forced to form a house union? Does he believe that our workers or union officials are so naive? A house Union will be formed when they are receptive, when they want it.

I have read from the newspapers that the NTUC has offered its advice, has offered its assistance, and I believe that the union has, in fact, asked the assistance of the NTUC. I cannot see any way in which the NTUC or anybody can force any union to form a house union. If the Member for Anson has other evidence, in addition and apart from this anonymous letter which he has received, then let him come forward now and tell us where exactly is his evidence for these serious allegations. And who is forcing? These vague allegations, nebulous statements, are statements which one does not find befitting or worthy of a reply, unless he gives us specific details. Then we can reply.

He has asked for my assurance about a secret ballot. I have given the answer on 17th January that the decision whether to form a house union, or any other decision which any union takes, must be in accordance with the constitution. If the constitution provides that there is no necessity for a secret ballot, then of course, we must abide by the constitution. It is as simple as that.

Mr Jeyaretnam: Sir, as usual, the Minister spends the time replying to me by making a tirade rather than a reasonable reply. Does he deny that advisers - I do not know what positions they hold - but Members of this House who are advisers in the NTUC have been busy at work in this union, trying to "persuade" (in inverted commas) the members into accepting house unions? That is what I understand. If he says no, he can deny that and the members of the Union will be able to say whether I have been speaking an untruth or the Minister has not been telling the whole truth.

The other matter is about the General Secretary. Again, if he says that there is no truth whatsoever, let him say so. Reference was made by the speaker before me about the check-off. I understand that in the case of this union, SATU, they enjoyed the check-off privilege and, as was pointed out, because of the difficulties, they did not get the authorization from their members every year. But I am told that this had continued for some time now. I do not know the length of time. But it had continued. The Ministry did not raise any protest about it. The NTUC, I understand, knew all about it. The matter was allowed to go on. But suddenly, now that the in- house unions are going to be promoted - the Minister has reiterated that the Government is very anxious, very eager to promote in-house unions - now they have been told, "You have not got the authorization. So we are not going to allow any check-off." I am told that the union wrote a lengthy explanation to the Ministry, explaining why the authorization of the members had not been obtained. They were told kindly that the explanation was not accepted.

The point of all this is - I do not know but I am told - that this had gone on for a while before this. But it is only now that the matter is being pressed against the union. I am sorry, but the members see all this as a determined effort to break up the union into four smaller unions and leave perhaps three of these unions without any effective leadership. They are quite upset, I understand, about the whole thing. They would rather retain the present union with its leadership which has served them, I understand.

All I am asking the Minister is: would he adhere strictly, without any evasion, to the principle of self-determination by the workers? It is not only on this that, I think, they should be given self-determination. There is also the question of the 12-hour working shift. In all these things, it is important that the workers be made to feel that they have the right to make up their own minds calmly and, after listening to both sides of the question, as it were calmly and not be pressured. That is all I am asking.

Would the Minister be prepared to give the assurance? I say that in the SATU constitution there is provision. As I have said, the union enjoys 98%, I am told, of the membership of the workers in these companies. For the happiness of their members and for their peace of mind, would the Minister give an assurance in this House that they will not be forced to break up into smaller unions without a secret ballot being taken?

I was going on, Sir, to another union, the Telecoms. The Postal Union is one of the oldest unions in Singapore. It is probably the earliest union. But after that it went through a series of mergers. Every time there was a merger, a secret ballot was taken. But now, in 1982, when they were taken out of the Amalgamated Union of Public Employees, I am told there was no secret ballot taken and that has caused a lot of unhappiness, among the members there.

I understand that the officers of the Union who were opposed to this break-up were summarily despatched elsewhere from their posts that they were working at. It is this sort of pressure that the workers know only too well that can be brought to bear on them so that their will is broken. And I say, we must not encourage this form of intimidatory tactics, either from the Ministry of Labour or from the employers or from the NTUC. The workers must be given free rein to make up their minds. They can be persuaded, reasonably, calmly, and the case presented to them. But, please, no pressure whatsoever should be brought to bear on them and that they should be given, as I keep saying, the principle of self-determination which is so essential for every human being.

Mr Goh Chee Wee: Mr Speaker, Sir, before the Minister replies, I must say that the Member for Anson has completely distorted the facts in the case of SATU. I wonder whether the Member knows that it is the executive council of SATU, members of the executive committee of SATU themselves who passed a resolution to invite NTUC to come in to help them to assess the possibility of forming house unions within SATU. I think that must be made clear.

Mr Jeyaretnam: Mr Speaker, Sir, with your permission, I am aware of that. But I am talking about the views of the members, the delegates, the shop stewards. It is they who are unhappy over the whole thing.

Prof. Jayakumar: Sir, I think I can be very brief. I was listening to the Member and I lost track of the number of times he prefaced each sentence with "I am told, I understand, I am given to understand". This sums up the basis on which his whole case rests, about 15 or 20 of "I am told", "i understand", plus one anonymous letter.

Sir, he says that the NTUC and their advisers have been busy persuading and giving advice and he has been told by the Member for Boon Lay what is the basis for that. I commend the NTUC for promoting the concept of house unions. No one can force branch unions into forming house unions. But, at the same time, let me make it clear, no one should be allowed to prevent, either because of established individual position or entrenched privileges, the formation of a house union if the members wish to do so. No branch union as far as I know has been forced into forming a house union. Those who have done so have done so willingly. Members such as the UTES themselves voted to form a house union.

I have already given my position concerning the decision-making procedure. I will not intervene in the decisionmaking procedure which is laid down under the provisions of the law, supplemented by the provisions of the constitution. If the constitution and the law provide for a decision on any matter, whether it be house union or other is to be taken by an open ballot, so be it. If it is to be taken by secret ballot, so be it. The Member for Anson as a lawyer must know that the law must prevail.

Mr Jeyaretnam: Mr Speaker, Sir, I am entirely in agreement with the Acting Minister when he says that no one should prevent ---

The Chairman: If you are in agreement, are you going to withdraw?

Mr Jeyaretnam: May I just reply, Mr Speaker, Sir, please?

The Chairman: If you are in agreement, I thought you are withdrawing the amendment.

Mr Jeyaretnam: No. What I was saying is that I am in agreement with one part of his statement when he says that no one should prevent break-up of the union if that is what the members want. There is no need for the Minister to say that because I never suggested anything else. I am pleading for the principle of self-determination and so no one should prevent them from breaking up if that is their wish. All I am asking is whether the Minister, as the Minister in charge of trade unions will assure the members of all trade unions, and I have mentioned the case of this union, Singapore Air Transport Workers' Union, that he will arrange or see that a secret ballot is first taken before there is any break-up of the union.

Prof. Jayakumar: The Member has just said that he has assured the trade union that they should take a secret ballot. Whether his advice is correct or not, I am not going to pronounce upon it, for I have said that it is going to be determined by the provisions of the law and of the constitution.

Mr Goh Chee Wee: Sir, I thank the Minister for all the answers he has given. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr Goh Chee Wee: Sir, I beg to move,

That the sum to be allocated for Head A be reduced by $10 in respect of Subhead RD-02 of the Main Estimates.

Under the Workmen's Compensation Act, compensation is payable to a workman if he suffers personal injury by accident arising out of and in the course of his employment.

The quantum of compensation is stipulated in the Act and this varies according to the nature and extent of injury. Different amounts of compensation are provided for death, for permanent incapacity and for temporary incapacity. Since 1971, the Government has gradually increased the quantum of compensation to take into consideration the rise in the cost of living. For instance, the maximum compensation payable for fatal accidents was raised from $21,600 in 1971 to $35,000 in 1975 and to $45,000 in 1980. In the case of permanent total incapacity, the maximum compensation was raised from $28,800 in 1971 to $45,000 in 1975 and to $60,000 in 1980. In other words, within 10 years, the maximum amount of compensation payable for death and permanent total incapacity has more than doubled. Whilst adjustment has been made for compensation for such injuries, the same cannot be said of the case of temporary incapacity.

In accordance with the Workmen's Compensation Act of 1971, workers who suffer temporary incapacity is entitled to full wages for a period of 60 days if he is hospitalized and 14 days if he is not hospitalized, and thereafter to a half-monthly payment during the period of incapacity of $195 or an amount equal to one-third of his monthly earnings, whichever is the less.

Sir, this provision of half-monthly payment of a maximum of $195 or an equivalent monthly payment of $390 during the period of temporary incapacity has remained unchanged since 1971. Sir, when a worker is temporarily incapacitated, he lost his income but he still has to support the family. My question to the Minister is: does he expect the worker to support his whole family with a miserable income of $390 or less a month?

The Minister for Finance and Trade and Industry has proudly told the House during the debate on the Budget Statement that the average income of Singapore workers has increased to $925. But here we have a Workmen's Compensation which is still maintained at the 1971 level. Sir, I cannot understand why the Ministry chose not to revise the figure for temporary incapacity when adjustments were made to the compensation for fatal accident and permanent incapacity. Has the Ministry over-looked the matter or does the Minister seriously think that the compensation level of 1971 is still applicable and sufficient to cover the cost of living in 1984?

Sir, the revision for such compensation is long overdue and I urge the Minister to take immediate steps to correct the anomaly and, to a certain extent, injustice.

The Chairman: Encik Abbas is not speaking.

The Parliamentary Secretary to the Minister for Labour (Mr Eugene Yap Giau Cheng): Mr Speaker, Sir, I am replying on behalf of my Minister. First, I would like to thank the Member for Boon Lay for raising the question of the need to revise the compensation ceiling of $390 per month for a worker who has sustained a tempor- ary injury. Before I give the reply, I would like to take this opportunity to clarify the Ministry's stand on the award of compensation for temporary injury sustained by workers. The quantum of compensation must be such that it is not too high so that it promotes malingering neither should it to be too low that the worker and his family suffer undue hardship. It is therefore not a question of whether it is fair or unfair but it is a question of whether it is reasonable or not reasonable compensation.

Having said that, I can now agree with the Member for Boon Lay that it is reasonable that we have another look at the compensation ceiling because the cost of living has gone up.

Mr Goh Chee Wee: Sir, since the Par, liamentary Secretary has said that a review will be made and that he will look into the matter, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Chairman: I think it is a good idea to take a break now.

Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the House.

Mr Speaker: I suspend the Sitting and shall take the Chair again at 5.30 pm.

Sitting accordingly suspended at 4.48 pm until 5.30 pm. Sitting resumed at 5.30 pm.

[Mr Speaker in the Chair]

Debate in Committee of Supply resumed.

[Mr Speaker in the Chair]

Head R (cont.) - The following amendments stood on the Order Paper Supplement -

Encik Abbas Abu Amin: (8) That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RD-03 of the Main Estimates.

Mr S. Chandra Das: (9) That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RE-01 of the Main Estimates.

Encik Othman bin Haron Eusofe: (10) That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RE-02 Object Group 1210 of the Main Estimates.

Mr M.K.A. Jabbar:

Mr S. Chandra Das:

Mr Tan Soo Khoon:

Encik Saidi Haji Shariff: (11) That the sum to be allocated for Head R be reduced by $10 in respect of Subhead RE-02 of the Main Estimates.

Mr Eric. Cheong Yuen Chee: (12) That the total sum to be allocated for Head R of the Main Estimates be reduced by $100.

The Chairman: Members in whose names the rest of the amendments stand have indicated they are not moving.

The sum of $31,262,430 for Head R ordered to stand part of the Main Estimates.

The sum of $1,181,000 for Head R ordered to stand pan of the Development Estimates.

The Chairman: I shall now deal with the remaining heads of expenditure in respect of which no amendment stands on the Order Paper Supplement. In respect of the Main Estimates, they are Heads B, C, D, E, F, G, H and X.

I propose to take those heads of expenditure en bloc.

Question, "That the sums stated for those heads of expenditure which appear in the last column of the Schedule of Estimated Expenditure under the Main Estimates on page 17 of Paper Cmd. 5 of 1984 stand part of the Main Estimates," put, and agreed to.

Question, "That the sum of $8,024,251,010 shall be supplied to the Government under the heads of expenditure for the public services shown in the Main Estimates for the financial year 1st April, 1984, to 31st March, 1985, contained in Paper Cmd. 5 of 1984," put, and agreed to.

Question, "That the sum of $8,994,174,600 shall be supplied to the Government under the heads of expenditure for the public services shown in the Development Estimates for the financial year 1st April, 1984, to 31st March, 1985, contained in Paper Cmd.5 of 1984," put and agreed to.

Resolutions to be reported.

Thereupon Mr Speaker left the Chair of the Committee and took the Chair of the House.

The Minister for Finance and Minister for Trade and Industry (Dr Tony Tan Keng Yam): Mr Speaker, Sir, I beg to report that the Committee of Supply have come to certain resolutions.

First Resolution reported -

"That the sum of $8,024,251,010 shall be supplied to the Government under the heads of expenditure for the public services shown in the Main Estimates for the financial year 1st April, 1984, to 31st March, 1985, contained in Paper Cmd. 5 of 1984."

Second Resolution reported -

"That the sum $8,994,174,600 shall be supplied to the Government under the heads of expenditure for the public services shown in the Development Estimates for the financial year 1st April, 1984, to 31st March, 1985, contained in Paper Cmd. 5 of 1984."

Dr Tony Tan Keng Yam: Mr Speaker, Sir, I beg to move, "That Parliament doth agree with the Committee on the said resolutions."

Question put, and agreed to.

Resolutions accordingly agreed to.