HDB SERVICE AND CONSERVANCY CHARGES (Reduction)

[Mr Speaker in the Chair]

The following Question stood on the Order Paper -

Mr Philip Tan Tee Yong: To ask the Minister for National Development, in view of the current economic recession, if the Housing and Development Board will consider reducing the service and conservancy fees payable by HDB residents with a view to helping them to tide over this difficult period.

Dr Koh Lip Lin (Nee Soon): Question No. 1, Sir,

The Minister for National Development (Mr Teh Cheang Wan): Mr Speaker, Sir, the present service and conservancy fees payable by HDB residents are already subsidized by the HDB. In the last three financial years, expenditure on estate maintenance services exceeded the income derived from the service and conservancy fees by between 18% and 38%. The expenditure can be expected to rise even further in future as there is a shortage 2of labour for such work. On its part, the HDB has stepped up its mechanization programme to reduce the dependence on labour. It has also actively sought the support and cooperation of residents to lower the maintenance costs.

Despite these measures, the total expenditure in FY 85/86 is projected at $312 million. At present rates for the service and conservancy fees, the revenue from these fees is estimated at only $220.6 million. The HDB therefore will have to subsidize the $91.4 million shortfall, or about 30% of estates maintenance expenditure. It is therefore not possible for the HDB to reduce the service and conservancy fees.

Mr J.B. Jeyaretnam (Anson): Sir, will he explain how is it then that the HDB was able to transfer a sum of $42 million from the service and conservancy charges to other subheads sometime in October 1984?

Mr Teh Cheang Wan: The service and conservancy charges account has been clearly published in the Annual Report. The

1984 Report for FY 1983/84 quite clearly show, that the income derived by the HDB from service and conservancy charges was $158.8 million. That is the published accounts. The expenditure for service and conservancy charges for that FY was $197.5 million. Therefore, there was a deficit of $38.7 million, and this deficit represents 24.4% of income. So it is quite clear from the accounts which are published that a heavy subsidy is provided by the HDB.

Mr Jeyaretnam: Does the Minister not realize, or has he forgotten, that sometime in 1984 (I think, in the last quarter) there was a transfer from service and conservancy fees of a sum like $42 million to paying interest on loans or something, to another subhead? Will the Minister explain how, in view of his statement that the HDB does not collect enough to pay for the maintenance service charges, it was able to transfer this $42 million?

Mr Teh Cheang Wan: Mr Speaker, Sir, I have already explained that for the financial year in question, the HDB has suffered a deficit of $38.7 million. But if the Member for Anson is interested in detailed accounting, he can write to me and I will give him a written reply.