PUBLIC SECTOR FEES AND CHARGES (Increases)

Mr Robert Chua Teck Chew asked the Minister for Finance whether there have been any recent or proposed increases in fees and charges in the public sector contrary to the Government's agreement to impose a moratorium on such fee increases during the first year of the introduction of the Goods and Services Tax as recommended by the National Wages Council and, if so, what are the reasons for such increases.

Dr Richard Hu Tsu Tau: The NWC recommended that during the first year of the introduction of the GST, there should be a moratorium on increasing public fees and charges, except for those increases that are absolutely necessary.

The GST was implemented on 1st April 1994. Between then and 1st July 1994, fee increases were implemented by one ministry, one statutory board and five educational institutions. The Ministry of the Environment raised refuse removal and disposal fees on 1st June 1994. The Port of Singapore Authority raised its tariffs on 1st July 1994. University and polytechnic fees were increased on 1st July 1994. None of these fee increases were related to GST itself.

The increases were necessary to recover unavoidable manpower and material related cost increases. They are consistent with the Government's policy to make gradual and periodic fee adjustments to minimise their inflationary impact. Delaying them would only have resulted in far larger and more painful adjustments for individuals and businesses later on.