BETTER RACIAL MIX IN HDB HOUSING ESTATES

Mr S. Dhanabalan: Mr Speaker, Sir, in a speech to community leaders on 6th January, I referred to the trend in some HDB estates where concentrations of racial groups are beginning to form. The President, in his Address to Parliament, also highlighted the gravity of this problem.

I would like to inform the House today of the measures that the Government is going to introduce to ensure a better racial mix in HDB estates.

The Government will set a limit on the maximum proportion allowed for each racial group in each HDB neighbourhood. It will also set a separate limit on the maximum proportion for each block. These limits are set out in Table 1 (Cols. 723 - 726). Some Tables and Annexes have already been distributed to Members. May I ask them to turn to Table 1? I will take them very briefly through this Table. Table 1 sets out the proportions of flats permitted for each race, each neighbourhood and block. You can see from this Table that for Malays who comprise 15% of the population, the permissible proportion of flats in each neighbourhood is 22% and for each block is 25%. For Chinese who comprise 76% of the population, the permissible proportion in each neighbourhood is 84% and in each block is 87%. And for Indians and others who make up about 9% of the population, the permissible proportion for each neighbourhood is 10% and for each block is 13%. These limits will cover the allocation of new flats as well as the sale of resale flats. They will take effect from 1st March 1989. Table 1 - PROPORTIONS OF FLATS PERMITTED FOR EACH RACE IN EACH NEIGHBOURHOOD AND BLOCK, NEIGHBOURHOODS AFFECTED BY LIMITS SPECIFIED IN TABLE 1 AS AT 15 FEB 89 (Cols. 723 - 726)

Mr Speaker, Sir, I would like to give the assurance that no HDB owner, whether he is Chinese, Malay or Indian will be requested to move from his present flat. The measures that we will be introducing to ensure a good racial mix will only affect the allocation of new flats and the resale of flats after 1st March 1989.

Let me now explain the reasons for the measures and how they will work. I have also distributed to Members three Annexes. (Cols. 719 - 722) May I ask them to refer to these annexes now. Annex I shows the racial distribution of applications for new flats. It shows that proportionately more Chinese applied for flats in Ang Mo Kio/Hougang Zone and proportionately more Malays applied for flats in the Bedok/Tampines Zone. Annex II gives the position for resale flats, applications to buy resale flats. Here Members will note that Malays bought more than half (55%) of the flats in the Bedok/Tampines Zone. In Bedok new town alone, if present trends continue, the proportion of Malays will reach 30% by 1991, and will exceed 40% in 10 years' time. Annexes - APPLICATIONS FOR NEW FLATS BY RACE AND ZONE, APPLICATIONS FOR RESALE FLATS BY RACE AND ZONE, PURCHASES OF RESALE FLATS BY RACE AND ESTATE IN 1988 (Cols. 719 - 722)

Similar trends are emerging in other estates, largely through open-market resale of HDB flats. This is illustrated by a more detailed analysis of purchase of resale flats by race and estate, and is shown in Annex III. You can see from Annex III that a high proportion of buyers in Bukit Merah, Redhill and Henderson were Chinese. In Bedok, Eunos, Teban Gardens and Taman Jurong, more than half the buyers were Malays. In parts of Yishun and in Kampong Java, there was a high proportion of Indian purchasers. There are clear signs that racial congregations are re-emerging. Although the problem has not reached crisis proportions, the experience in other multi-racial societies such as the United States shows that while racial groupings start slowly, once a critical point is passed, racial groupings accelerate suddenly.

With the slowing down of HDB's construction of new flats, resale flats will have an increasing influence on the ethnic composition of the HDB estates and new towns. We must therefore introduce open and clear policies early, to stop these trends.

In the late 50's and early 60's, various sections of our population were gathered in different pockets, distinguishable by their race or dialect groups. Older Singaporeans will remember that the Malays were concentrated in Geylang Serai, Eunos and a few other areas. The Indians were found in disproportionate numbers in the Serangoon Road and Naval Base areas. The Chinese gathered in dialect groups: the Cantonese in Kreta Ayer, the Hokkiens in Telok Ayer, the Teochews in the Upper Serangoon and Boat Quay areas, and the Hainanese in the Beach Road/Middle Road areas. Each group was fiercely proud of its own identity and defended its narrow interests stoutly. Each clung to its own race or community for security and mutual assistance.

It was clear that something had to be done if we wanted to build a cohesive, stable and harmonious society and a nation. The Government seized the opportunity of the massive public housing programme to mix the population. We made sure that every HDB new town and estate reflected the racial mix of the population as a whole.

With few exceptions, we have made each electoral constituency representative of the racial and social mix of Singapore. Each HDB new town has a cross-section of Singaporeans. Each has its share of talent and community leaders. Each MP is familiar with the problems of every ethnic, social and economic group in Singapore. Grassroots leaders too are familiar with these problems and can therefore play a more effective community development role among their residents.

Most importantly, each racial group has developed an understanding of the other racial groups that make up our nation. This explains how we have been able to forge a consensus on social issues and carry the population with us. Mixing the various communities in proportions that approximate the general population has given us racial tolerance and harmony for the last 20 years and more. To allow them to regroup now will be to go back to the pre-1965 period when conditions bred distrust and misunderstanding among the various races and when there were even racial riots.

We will, therefore, set limits on the maximum proportions of each racial group allowed in each HDB neighbourhood. These are, as I have already explained, set out in Table 1. These proportions take into account the existing racial composition of our population and the projected demand for HDB flats by each racial group. The projected demand is based on the rate of formation of new households as well as recent trends in applications. We have chosen the HDB neighbourhood as our basic unit to apply the racial proportions because the neighbourhood is a distinct entity with a well-defined physical boundary. A neighbourhood comprises an average of 50 blocks with about 5,000 flats. Every HDB new town is made up of a number of neighbourhoods, each designed around a neighbourhood centre, which is a focal point for community activities.

The neighbourhood limits set out in the table will ensure that each neighbourhood has a good racial mix of residents. In addition, the limits on individual blocks will prevent any single block from developing a concentration of a single racial group. The limits on blocks are set three percentage points higher than the limits for neighbourhoods. This is to allow some variation of ethnic proportions from block to block. For example, you can see from the table that while Chinese can occupy 87% of the flats in a block, they may not exceed 84% of the flats in a neighbourhood.

In the sale of new flats, the HDB will use these proportions as a guide to allocate the flats and will as far as possible follow the existing first-come-first-served policy.

I would now like to explain how these proportions will apply in the resale of flats. If the existing proportions in a neighbourhood or block are within the limits set in Table 1, there will be no restrictions. Anyone can sell his flat to any buyer, regardless of race. The operative limit is the neighbourhood limit. As long as the neighbourhood limit is below that which we have set out in the table, transactions can take place freely, until such time as the permissible limit for anyone of the racial or ethnic groups has been reached.

Let me now illustrate how these proportions will work in different contexts. For example, let us assume that Malays already occupy 22% of the flats in a neighbourhood, the Malay proportion will therefore have reached the limit set for Malays. A Malay in this neighbourhood may sell his flat to a buyer of any ethnic group, because by doing so, he will not be increasing the proportion of Malays in the neighbourhood. If he sells to a Malay the proportion will remain the same. If he sells to a non-Malay the proportion will come down. A non-Malay, however, who intends to sell his flat will have to sell his flat only to a non-Malay. He cannot sell to a Malay because if he does so, the proportion of Malays in the neighbourhood will go beyond the 22%.

Similarly, suppose in a neighbourhood the Chinese occupy 90% of the flats and thus exceed the neighbourhood limit for Chinese which, Members will remember, is 84%. A non-Chinese in this neighbourhood may only sell his flat to another non-Chinese because if he were to sell to a Chinese he will cause the proportion of Chinese in the neighbourhood to go up even further. A Chinese, however, is free to sell his flat to a buyer of any ethnic group. If a Chinese sells his flat to a non-Chinese, the proportion occupied by Chinese in the neighbourhood will come down. The proportion will not be allowed to go back to 90% as this exceeds the limit that we have set. So we will allow the proportions to come down as and when a Chinese sells to a non-Chinese, and we will not allow the proportions to go back to the 90%.

Let us take a third example. Suppose the proportion of Chinese in a neighbourhood is 80%, ie, below the limit set for the neighbourhood for Chinese, but there is a block in the neighbourhood with 95% Chinese, much higher than the block limit for Chinese. Then a non-Chinese owning a flat in that block will only be allowed to sell it to another non-Chinese, whereas a Chinese can sell it to anybody. From this example, it will be clear that an HDB owner can sell his flat freely as long as the buyer is of the same ethnic group. Similarly, someone looking to buy a flat in the resale market can buy one freely as long as the seller is of the same ethnic group. The permissible limits only arise when the buyer and seller are of different ethnic groups and they are in neighbourhoods where the limits are already higher than the limit set out in the table.

This way we will contain the problem. Where the limits have already been exceeded, our measures will prevent the situation from deteriorating. However, these measures will not force the proportions down.

Out of the 125 HDB neighbourhoods, the HDB has identified 35 neighbourhoods which will be immediately affected by these measures. Table 2 shows where these neighbourhoods are. These are the neighbourhoods where the owners have already occupied the flats for more than five years and are thus free to sell in the open market, and these are neighbourhoods where the existing levels or proportions for any one of the three ethnic groups exceeds what we have set out in the table. But it does not follow of course that everybody who lives in these neighbourhoods will be affected immediately or even in the long run. It will only affect those who own and want to sell their flats. Only such people will be affected.

Resale statistics show that most HDB owners who sold their flats sold their flats to buyers of the same ethnic group. Based on this trend, the HDB estimates that fewer than 1,200 owners in these 35 neighbourhoods will be affected in the next 12 months if they want to sell their flats, say, in the next year. In other words, if these measures that we will be introducing had taken effect one year ago, there would have been about 1,200 transactions that could not have taken place. If as a result of this policy to ensure a balanced racial mix in HDB estates, anyone finds it difficult to sell his flat in the open market, the HDB is prepared, as a last resort, to buy back the flat at prevailing posted price.

I would like to repeat the assurance that no one will be asked to move from his present flat. Where the present proportions exceed the limits, we will allow time and redevelopment of the area to bring the proportions down and to achieve a better racial mix.

Mr Speaker, Sir, our multi-racial policies must continue if we are to develop a more cohesive, better integrated society. Singapore's racial harmony, long-term stability, and even viability as a nation depend on it.

Mr Ng Pock Too (Nee Soon Central): Mr Speaker, Sir, I would like to ask the Minister two questions. First, he mentioned in his statement that the new measures will immediately affect 35 neighbourhoods. As the control is by neighbourhood and block, are there blocks outside these 35 neighbourhoods which have exceeded the permissible proportions, and will they be similarly affected by the new measures?

Secondly, the Minister said that the proportions will act as a guide to allocate new and resale flats within the current first-come-first-served policy. How will these new measures affect the first-come-first-served policy which, I would like to remind him, has all along been the basis universally accepted as a fair allocation principle?

Mr Dhanabalan: Mr Speaker, Sir, may I take the questions as they come up.

Mr Speaker, Sir, it is true there are blocks outside these 35 neighbourhoods where the limits already exceed those that I have set out in Table 1. But the transactions that are likely to be affected, if we go by past experience, would be very few. We estimate that about 18% of the blocks outside these 35 neighbourhoods will be affected. But if we go by past experience, out of a total transactions of 8,000 or more, only 500 would have been affected by these measures. Therefore, I did not mention these figures.

As to the first-come-first-served policy, as I mentioned, HDB will try as far as possible to follow this policy. In the first instance, in the allocation of new flats, HDB will allocate according to the first-come-first-served policy until the proportion for any one of the ethnic groups is reached. Then, allocation for that ethnic group will be stopped and we will go on to the other ethnic groups. So, in effect, there will be four lists. One is the normal list all applications starting from 1, and running in consecutive order. And then there will be another one for each one of the groups - Chinese, Malays, Indians and others. The first list will form the basis for allocation as a start. Once a particular race or ethnic group has reached the proportion set, then they will skip and go on to the other ethnic groups. So there will be a change in the policy.

Dr Wang Kai Yuen: , Mr Speaker, Sir, I have several questions for clarification by the Minister. My question actually relates to Table 1 which gives the proportion of flats permitted for each race in each neighbourhood and for each block. If you look at the second column, that is, the permissible proportion of flats in each neighbourhood versus the percentage in population, you will notice that for Malays, 22% is 5 percentage points beyond 15%; and for Chinese, 84% is 8 percentage points above 76%; and for Indians, 10 percentage is only 1 percentage point above 8.9%. Perhaps the Minister can give us a better understanding as to how this number is arrived at. For instance, I would imagine that it might be better to say that for the Indians, being half the percentage shown in terms of population, the variation would be half of that permissible for Malays. So 3.5% might be a better figure, judging from this Table.

Question No. 2 also relates to this Table. These percentages are based on current percentages in population. Would these percentages, in terms of permissible proportions, be reviewed from time to time if the population shifts in future?

Mr Dhanabalan: Mr Speaker, Sir, I thank the Member for this opportunity to clarify Table 1. As I mentioned in my statement, these permissible proportions are based on a number of factors. The racial composition of the population is only one of the factors. The more important factors are the rate at which new households are being formed in each one of the racial groups and the present composition of applications. Applications for HDB flats at present do not reflect the racial composition in Singapore as a whole. If you look at the applications, Malays accounted for about 19% of the applications; Chinese accounted for 74% of the applications; and Indians and Others as a group accounted for 7% of the applications. Because of the greater unmet demand from Malays, the present applications are higher than the proportion of the population. So we took this into account and fixed the proportions accordingly and allowed some variation. So if you just compare the composition of the population by race to these figures, of course it appears that we have allowed more latitude for one group and less for others. But if we take into account the composition of the applications and our estimates of the rate at which new households are being formed, then I think this will work.

The second point is what happens if there is a change in the composition of population. Of course, we will have to review from time to time and bring these permissible proportions in line with such changes.

Mr Peh Chin Hua (Jalan Besar GRC): ( In Mandarin): Mr Speaker, Sir, on the problem of racial congregation in separate enclaves, I have two questions to ask the Minister. First, as it stands today, we have not seen any sign of any racial disharmony among the people in the Housing Board estates. So I feel that the measures mentioned by the Minister would be a kind of restriction on some of the people. Is this kind of restriction necessary, and will this be feasible?

My second question is: I would like to ask the Minister whether he would consider using the existing technological system and technique such as telephone, electronic communication and teleview or employing well-trained enquiry counter officers so as to minimize the inconvenience caused to residents when they resell their flats.

Mr Dhanabalan: Mr Speaker, Sir, can I take the second point first whether HDB can use all the available new technology to inform HDB residents of the proportions in each neighbourhood block. Yes, I will certainly ask HDB to look into how they can most effectively and best inform HDB residents.

Regarding the first point, I think it may be useful, Mr Speaker, Sir, if some of the points that I made could be re-stated because the Member has asked whether these measures are, in fact, necessary. I would like to have it re-stated in Mandarin for the benefit of the Chinese press and others who speak Mandarin. So I will ask my Minister of State to answer this.

The Minister of State for National Development (Mr Peter Sung): Mr Speaker, Sir, on behalf of my Minister.

(In Mandarin): The Minister for National Development has already explained the measures in detail. I will briefly summarise the main points.

A few decades ago, various racial groups congregated in ethnic enclaves. The Malays were concentrated in Geylang Serai and Eunos. The Indians were found in Serangoon Road. Among the Chinese: the Cantonese in Kreta Ayer, the Hokkiens in Telok Ayer, the Teochews in Boat Quay, and the Hainanese in Beach Road and Middle Road.

Why did they congregate together? It is because they felt that by so doing they could promote their own security and could better look after their own welfare and interests. This is good. But their attitude towards other races is sometimes different. This sometimes led to misunderstandings and undesirable consequences.

In the allocation of flats under the public housing programme over the last two decades, the Government took the opportunity to redistribute the population so that every HDB estate reflected the racial mix of the population. As a result:

(a) Every racial group is represented in each constituency. Each Member of Parliament developed better understanding of the living habits, the economic conditions and social/political positions of his residents.

(b) Each racial group has developed mutual understanding with the other racial groups.

(c) We have forged racial tolerance and harmony. For more than 20 years, we did not have serious racial problems.

However, in the last few years, there were some undesirable developments. While the various ethnic groups were properly distributed during the allocation of new HDB flats, there was no restriction on the resale of flats. There was a tendency for the various ethnic groups to again congregate through the process of resale. For example:

(a) more Chinese prefer flats in Ang Mo Kio and Hougang

(b) more Malays prefer flats in Bedok, Tampines, and Eunos

(c) more Indians prefer flats in Kampong Java.

There are clear signs that racial congregations are re-emerging. Up to now the problem is not very serious. But if we do not prevent this now, we may lose control in future. In some other multi-racial societies, this phenomenon is already beyond control and had created uneasiness among the people.

In order to avoid such undesirable consequences, the Government will introduce measures to ensure ethnic balance in HDB estates. My Minister has already distributed figures showing details of these measures; it is not necessary for me to repeat them.

This new policy will take effect from 1st March 1989.

(a) But the government assures that existing HDB residents will not be forced to move from or sell their present flats.

(b) The new policy will apply to the allocation of new flats.

(c) The new policy will also apply to the resale of flats from 1st March 1989. For example, if the Malay community in a HDB block has already reached or exceeded the permissible limit, a Chinese who wants to resell his flat cannot sell it to a Malay. If the Chinese cannot find a buyer because of this restriction, the HDB is prepared to buy his flat from him at the prevailing HDB posted prices.

Mr Speaker, Sir, I would like to repeat the Government's assurance that no one will be required to sell his present flat. The Government has no need to force anyone to do so, because after a certain period following the introduction of this new policy, ethnic balance will again be restored and all races will again be adequately represented in the various HDB neighbourhoods. Singapore will be able to retain its present position where the various races continue to live in racial harmony.

Mr Abdullah Tarmugi (Siglap): Sir, I would appreciate it if the Minister could clarify some points. (1) In the event of the HDB having to buy back a flat, can the Minister consider paying the market rate instead of the posted rate, as the latter will always be lower than the former? The posted price can be used when the HDB resells. (2) How will the lessee's difficulty in selling flats be determined, and by whom? (3) Will HDB in tandem with the new policy ensure that facilities, services and goods available in neighbourhoods be similarly dispersed so that it would be easier for everyone? Because one of the reasons for the people's reluctance to live in certain neighbourhoods is the difficulty in having access to facilities, goods and services peculiar to them. Lastly, has the HDB or the Ministry looked into any other methods prior to this?

Mr Dhanabalan: Mr Speaker, Sir, on the question of whether HDB should buy back at prevailing posted prices or market prices, it is true that the market prices are higher than posted prices in many areas. But the market prices vary, not only from block to block but from flat to flat and it is very difficult to establish what exactly is the market price. In fact, the premiums paid by people are such that in an analysis of the prices of HDB flats, we have not been able to really establish quite clearly a pattern, either by race or by area. There are instances where Chinese pay a premium; there are instances where Malays pay a premium for the same type of flat in the same area. This may be due not only to differences in the internal finishes of flats but people's own assessment as to what they are prepared to pay for something that they want. So if HDB were to try and pay market prices, I do not think it will be able to determine what exactly is the market price. Of course, we may be able to determine a price which is in the ball-park, which will not leave many people satisfied. My own assessment is that while a few may not be able to get exactly the maximum that they expect, they would still be able to get, with these new measures, prices well above the posted prices. At the same time, as I have mentioned in various statements in the past, the HDB itself intends to move its posted prices closer and closer to market prices. So this gap will narrow.

How will difficulty be determined? Well, when an HDB flat owner sells his flat and moves to another flat or to a private apartment or a house, he has a certain period within which he has to sell his flat. If he cannot sell it within that period, that means he has difficulty in selling it and he can sell it back to the HDB. If, as a result of these measures to bring about a better racial mix, a slightly longer period is required, the HDB can consider that.

The third point is a good point. If you want to have a better mix of the various ethnic groups in all HDB estates and new towns, then the kind of facilities that will attract the different ethnic groups should also be spread. HDB is aware of it and will take action to ensure that the facilities and services required will be well spread. This will require, of course, that some facilities will have to be put in there early, earlier than necessary, in order to attract an ethnic group into that estate. And that is being considered.

As to whether we have considered any other method, the method that we have followed all along has been in the initial allocation of new flats. We have tried in the past, in the allocation of new flats, to follow some sort of ethnic distribution which will reflect the general population. It was easy to do it in the past when we were building at a very high rate and when the waiting list was very long and when people were prepared to take up flats immediately anywhere. But as we began to meet the demand and the waiting list became shorter, and as more and more flats began to come on to the resale market, it has become difficult to only use initial allocation as a basis to bring about a good mix of the different ethnic groups. And that is why we have now embarked on this new open policy of ensuring that there is a good racial mix in each HDB estate and new town.

Dr Arthur Beng Kian Lam (Fengshan): Mr Speaker, Sir, I have three questions for the Minister. Firstly, with reference to Table 1. He has explained column 2. I would like to seek his explanation or clarification of column 3 where he adds 3% on to column 2. How did he reach this figure of 3%, and will it not actually be fairer to give a range for a block?

Second, the Minister has stated that the proposed solution will only contain the problem so that it will not deteriorate. I congratulate the Minister on this because the manner of implementation is not only fair but it also results in minimal disruption. However, will the Minister also consider giving priority to redevelopment in constituencies which are already affected by this problem of ethnic distribution? And will it be possible to do this in the next 3-5 years?

Third, what criteria will the HDB use to define a sale of last resort?

Mr Dhanabalan: Mr Speaker, Sir, there is no mathematical magic in column 3. We tried, in the first instance, to focus on the neighbourhood and gave some allowance to the neighbourhood in comparison with the present application list. And that is how column 2 was determined. For column 3 which is the block limit, we just gave a margin of 3% flat for every group. As to whether we could give a range, we could have. But in a policy like this, it is very important to make it very clear in the implementation that we are absolutely fair to everybody. If we give a range, then that means that the limit will vary from place to place and this can give rise to a lot of suspicion and misunderstanding. We thought it is better to just fix a specific limit and use that for all the ethnic groups in all areas.

I mentioned that where the existing proportions exceed the limits that we have set out in Table 1, we will allow time and redevelopment to bring about a better mix. So we will certainly give priority in redeveloping areas where the ethnic mix is well beyond what we have set out in the table and use the allocation of the new flats to bring the mix more to the levels that we have set out in the table. This, of course, cannot all be done within a few years but we will be starting on such a programme and I hope that within 3-5 years, the programme will be well under way.

As for the criteria for sale of last resort, I thought that is pretty simple. If you cannot sell, you go to HDB.

Dr Arthur Beng Kian Lam: Sir, it is not so clear. If the criteria is time span, that means you go to the HDB if you cannot sell it within 2-3 months. Or does a person have to advertise 5 to 10 times before it can be considered?

Mr Dhanabalan: Mr Speaker, Sir, there are already existing time limits for HDB owners to sell their flats or move out of their flats because they upgrade to another HDB flat or move out to a private house or apartment. There is a time limit within which they have to sell their flat. And that time limit will apply. Whether they advertise or use agents, it is entirely up to them. And as I mentioned, if necessary, we can make the time limit a little more flexible for such cases.

Mr S. Chandra Das (Cheng San GRC): Mr Speaker, Sir, I would just like to ask the Minister how do the measures he announced in his Ministerial statement reconcile with the Government's policy in promoting Geylang Serai, Little India and Chinatown.

Mr Dhanabalan: Sir, I do not think there is anything to reconcile. These three areas Geylang Serai, Little India and Chinatown are basically centres of commercial activity. They do not necessarily reflect the composition of the races living in these areas. Take Little India for example. Going through Serangoon Road, one would get the impression that 90% of the people who live there are Indians. But that is not so. It is a place where Indians from all over Singapore go to do their shopping. Similarly, Geylang Serai; and similarly with Chinatown. So I do not think there is any contradiction. We will still promote these as commercial and cultural areas for the three main ethnic groups. But where it comes to residences we will apply these proportions.

Mr Leong Horn Kee (Thomson): Sir, I have two questions for the Minister. I support the policy in principle, that it is good to have a better mix of races in the housing estates. I would like to ask the Minister whether he has any view or opinion as to how this new policy or rule will affect the market price mechanism in the transfer of flats. Because now there is an additional restriction in the transfer of flats from the householder to the potential buyer, will this not have a very great dampening effect on the price of a flat that person can get if there is no such restriction?

The second question is whether there is any control over a person who wants to sell his flat to a relative or a friend under some special arrangement rather than under the market mechanism.

Mr Dhanabalan: Mr Speaker, Sir, I mentioned that the vast majority of transactions in the HDB resale market are among people of the same ethnic group. In other words, the seller and buyer are of the same ethnic group. In fact, that will determine more or less the general price in the market. So I do not anticipate a great dampening effect. But there will be from time to time, specific cases of people who may think that if they are able to sell to a Chinese or Malay they could have got a higher price. I think that is a small price we must be prepared to pay in order to ensure that we do build a cohesive, better integrated society in Singapore. I do not expect a great dampening effect because the resale between different ethnic groups is not the major part of the HDB resale market.

As to selling to a relative or friend, I have already mentioned that where the transactions are between two persons of the same ethnic group there will be no restrictions at all. So if the relative or friend is of the same ethnic group there should be no problem. And I would assume in the case of relatives, in most cases that would be the case.

The Parliamentary Secretary to the Minister for Foreign Affairs (Encik Yatiman Yusof): Mr Speaker, Sir, I would like to ask the Minister two questions. (1) Is the problem more serious than what is revealed through the figures because of possible differences in the household sizes of various ethnic groups. (2) The proposed measures seem to be preventive in nature. Would the Minister consider any form of incentive to encourage a better mix of ethnic groups in the housing estates.

Mr Dhanabalan: Mr Speaker, Sir, it is true that when I mentioned, for example, that certain HDB housing estates have so many percent Malays, and so many percent Chinese, they do not necessarily reflect that the number of Chinese or Malays are of the same percentage. We all know from the various population figures that we have been given that, for example, Malay households tend to be bigger, Indian households somewhat smaller and the Chinese households tend to be the smallest. We are aware of it. So if you look at it purely in terms of numbers of the various ethnic groups, the number of persons, yes, the racial congregations or groupings are somewhat greater than would be reflected by the number of flats occupied by any ethnic group.

Yes, the measures are preventive and we need to consider incentives. And the first incentive, of course, which I have already mentioned, is to create conditions which will attract people to go to areas which they do not go to now. For example, if Malays are not attracted to Pasir Ris, then we ought to do something in Pasir Ris which will attract them there. If Chinese are not prepared to go to Bedok or Woodlands, then we ought to consider how we can attract them to go there. So when it comes to services and facilities, we will try and make it more attractive. If we spread the services and facilities for all the ethnic groups, then I think we will get a better spread of the ethnic groups and a better mix.

As for financial incentives, we have not thought of that now. For the moment I think we will try these measures and I am confident that they will work.

Mr Loh Meng See (Kampong Glam): Sir, may I ask the Minister whether the same intention applies with regard to the allocation of rental flats in the housing estates? I am aware that we are referring now to the sale and resale of flats but what about the rental tenants? Will it be similarly applied to them?

Mr Dhanabalan: Mr Speaker, Sir, since rental flats are reducing as a proportion of the total number of HDB flats, it is not a serious problem, but we will apply it also to rental flats. Obviously, we will have to apply it to rental flats.

Dr Koh Lam Son (Telok Blangah): One question for the Minister. Would this measure affect the existing priority housing schemes, such as the resettlement and the three-tier family housing schemes?

Mr Dhanabalan: Mr Speaker, Sir, the existing priority schemes of various types, resettlement, multi-tier, as well as for community leaders and so on, affect the allocation of new flats. And these proportions will apply. In the allocation of flats, we will have to take into account these proportions.

Mr Heng Chiang Meng (Cheng San GRC): Sir, I just want to say that I also support the new policy. I think it is a good policy, but I have a question for the Minister. I would like to ask whether there is some form of flexibility for special cases. For example, how do you classify a family of a mixed race marriage. For example, the husband may be a Chinese, the wife may be an Indian. Do you classify the family as Indian or Chinese? Let us assume that you follow the husband's race and classify them as Chinese. If the mother-in-law, for example, happens to leave the house upon death to the family and they happen to be in a neighbourhood which is already above the limit for Chinese, then would the HDB say, "No. You must sell it to a non-Chinese family. If not, sell it back to HDB."

Mr Dhanabalan: Mr Speaker, Sir, Members will have noted that in grouping the various ethnic groups we use Chinese, Malays, Indians and Others. In the case of Malays, Indians and Others, there is already now an established way of identifying who are such people because we have in the law, for example, in the GRCs, how they should be identified. There will be not many cases which are very specific, very peculiar to that particular person. We do have a special committee in HDB already to look into such cases and flexibility is always exercised. So whether a person wants to call himself Indian or Chinese, and whether the HDB is prepared to accept that can be looked into. But I do not think this will account for the a large number of cases.

Encik Wan Hussin bin Haji Zoohri (Aljunied GRC): Sir, one question for the Minister. Sir, in the light of these restrictions placed on flat owners to sell their flats to buyers of their own choice and in the possibility of sellers not getting the market rate, could the Minister assure the House that these restrictions or measures are not against their Constitutional rights?

Mr Dhanabalan: Mr Speaker, Sir, I did consult both the Minister for Law and the Attorney-General on whether these measures would be against our Constitution and I have been advised that they are not because they apply to all. Nobody is being discriminated against by these measures. They apply to all races in Singapore.