LAND ACQUISITION (AMENDMENT) BILL

Order for Second Reading read. 3.51 pm

The Minister for Law (Mr E.W. Barker): Mr Deputy Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

This is a simple Bill which seeks to amend section 33 of the Land Acquisition Act on the amount of compensation payable to owners of land compulsorily acquired under the Act. The new basis of compensation will apply to any land acquired on or after 30th November last year. The position as the law stands prior to this Amendment is that compensation for acquired land is based on its market value as at 30th November 1973, or its market value as at the date of notice of acquisition whichever is the lower.

Sir, values of land in Singapore have changed considerably since 1973 when the present provision was introduced. The Government has therefore decided to change the basis of compensation payable by pegging it to the value of the acquired land as at the lst January 1986 or as at the date of notice of acquisition, whichever is the lower.

Sir, I beg to move.

Question proposed.

Mr Ng Kah Ting: (Punggol) Mr Deputy Speaker, Sir, I shall be brief.

This Amendment Bill is a long awaited piece of legislation which makes the amount of compensation paid for properties acquired more equitable. Mr Deputy Speaker, Sir, my GPC met and discussed this Bill together with members of our Resource Panel. We are in support of this Bill and welcome Government's move to amend the Land Acquisition Act (Chapter 152 of the 1985 Revised Edition) as has been explained just now by the Hon. Minister for Law.

However, Sir, we would like to ask of the Hon. Minister first to explain why it is necessary to provide in the Bill for compensation payable for any property acquired after 30th November 1987 to be pegged at the market value as at 1st January 1986 if the market value of the property at the date of acquisition is higher than the market value as at lst January 1986. Then why is 1st January 1986 taken for valuation purposes? Would it not be more equitable if the compensation is based on the market value as at the date of notice of acquisition?

Sir, we discussed the question which concerns owners of only one residential property. They may continue to face hardship if their residences are acquired and compensations are paid to them according to the provisions in the Bill, especially if the property values of residential properties are escalating. They would feel even more aggrieved if they had purchased their residences after 30th November 1973 or more recently and at prices higher than that of 1st January 1986. The price or prices they paid for their properties would have been included in the cost of the development of the land in the vicinity of their property. So in a rising property market they would not be able to secure an equivalent residential property. Therefore, Sir, in our view, we would like to ask whether the Hon. Minister would consider continuing to assist such property owners whose only residential property is acquired. I hope, Sir, that he would be forthcoming in his reply.

Finally, Sir, there are various occasions in the past when properties were acquired for public development purposes but were left to waste for many years before they were eventually developed. We would like to urge that great care be taken to ensure that land acquired for public development is taken off for development as soon as possible after the acquisition. In making this observation, Mr Deputy Speaker, Sir, we note that some lands acquired have not been fully developed, as had been indicated in the various replies given in this House to the Questions for Oral Answer.

Sir, we support the Bill.

Mr Heng Chiang Meng (Jalan Kayu): Sir, the current section 33(1)(a) in the Act, as everybody knows, is inherently unfair as it freezes land value for the purpose of compensation at the value on 30th November 1973. As the Prime Minister had once said, the Government is playing Robin Hood. So therefore in the same vein I would like to ask the Minister whether the increase in compensation to land value on lst January 1986 would mean increases in the prices of HDB flats?

Mr Barker: Sir, we chose the 1st January 1986 because in the last few years the price of land was the lowest on that date. We are conscious that we must save your money. But the difference is not much. The difference between 1st January 1986 and 1st January 1987 is probably about 5%. It is really not much. But the difference between the 30th November 1973 and the 1st January 1986 is substantial. So this is a good move.

As for ex-gratia payments, this is not provided for in the Bill. But it is done administratively. In the past, even now, where a person owns just one house or residential property and it is acquired and if he gets, say, $200,000, today it is not enough to buy a comparable piece of property. So we top it up by giving him an ex-gratia payment of, say, $400,000 to give him about $600,000. This practice will continue, though it is not part of the legislation.

I could not get the point of the Member for Jalan Kayu, but the price of HDB flat is no concern of mine.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr E.W. Barker].

Bill considered in Committee.

[Mr Deputy Speaker in the Chair]

Clause 1:

The Chairman: The citation year will be altered from "1987" to "1988".

Clause 1 ordered to stand part of the Bill.

Clause 2 ordered to stand part of the Bill.

Bill reported without amendment; read a Third time and passed.