GRATUITY PAYMENT TO MRT EXPATRIATE STAFF

Mr J.B. Jeyaretnam asked the Minister for Communications and Information (a) whether his Ministry was consulted before the decision by the Mass Rapid Transit Corporation to pay expatriate staff the loss in their salaries as a result of the reduction in the employers' contribution to the Central Provident Fund from 25% to 10%; (b) what categories of staff are being paid this loss; and (c) does the Ministry justify the decision and, if so, what reasons are there to justify the distinction between expatriate staff and local staff.

Dr Yeo Ning Hong: The Mass Rapid Transit Corporation (MRTC) has not paid any staff for the loss of their salaries as a result of the reduction in employer's contribution to the Central Provident Fund.

Prior to July 1981 all expatriate officers were paid a gratuity upon satisfactory completion of their contracts. Since then they were placed instead on the full CPF Scheme. In July 1986, MRTC implemented an end-of-contract gratuity scheme as an alternative to the CPF Scheme for its expatriate staff. Both the Ministry of Finance and the Ministry of Communications & Information were consulted before the scheme was implemented. The contract gratuity scheme is more appropriate in recruiting and retaining expatriates with specialised skills and experience such as in tunnelling, deep excavation and system-wide electrical and mechanical design and coordination work. By offering them emoluments comparable to international market rates and making the terminal gratuity payable only upon satisfactory completion of their contracts, such people will be induced to serve out their contracts.