REDUCED TAS TARIFFS (Revenue loss)

Mr Yeo Choo Kok asked the Minister for Communications and Information (a) whether he will inform the House about the reduction in tariffs that the Telecommunication Authority of Singapore had made to help businesses stay competitive; (b) what is the loss in revenue as a result of such reduction; and (c) whether more reductions are to be made in 1988.

The Minister for Communications and Information (Dr Yeo Ning Hong): Mr Deputy Speaker, Sir, since 1979, Telecoms has revised its tariff rates for international telephone and telex services eight times. Today, our businessmen pay one of the lowest international telephone and telex tariff rates in the world.

As a result of the tariff reductions, cumulatively more than $1.5 billion has been passed back to the consumers over the past seven years. In 1986 alone, an additional $19 million was passed back to the economy when Telecoms revised its tariff rates for international telephone and telex, radio paging and postal services. In addition, the sales scheme implemented recently for mobile telephones, radio pagers and facsimile machines and the liberalization of the maintenance of private switching equipment will result in another $10 million savings in rentals which will be passed back to the consumers.

Telecoms will continually review its tariff rates and will pass back to its consumers any cost savings achieved through economies of scale, productivity gains and technological advancement. For the financial year 1987/88, Telecoms will review yet again the tariff rates, particularly for Telepac and Telefax services. Hopefully, this could result in some cost reduction to businessmen for the transmission of data, messages and correspondence.

Mr Yeo Choo Kok (Delta): Sir, if the TAS is to privatize, will the consumers continue to benefit from these cost savings?

Dr Yeo Ning Hong: Mr Deputy Speaker, Sir, if the TAS is privatized, it will have to depend on the decision of the private company running the Telecoms services.