HOUSING AND DEVELOPMENT (AMENDMENT) BILL

Order for Second Reading read.

The Minister for National Development (Mr Lim Hng Kiang): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Objective

The objective of the Bill is to amend the Housing and Development Act to allow gazetted corporate bodies to buy HDB resale flats. For a start, only Jurong Town Corporation (JTC) will be gazetted.

Rationale

There is a pressing need for JTC to meet the increasing demand for affordable housing among foreign professionals working in Singapore. As our Singapore economy grows, we need more skilled workers and management staff. Our local workforce is insufficient. We need to supplement with skilled foreign workers and professionals. The majority are either staying in HDB flats or private properties on a rental basis or have their own private accommodation arrangements.

Presently, HDB allows flat lessees who are unable to occupy their flats for valid reasons to sublet their whole flats. Currently, about 80% of the approved cases are rented to foreign workers. HDB also allows flat lessees to sublet their rooms provided they occupy at least one room in the flat for their own use.

HDB also provides assistance for the housing of foreign workers under two different housing schemes. The first scheme is the Integrated Non-Citizen Housing Scheme where interim housing on a two-year term tenancy basis is provided to employment-pass holders and skilled work permit holders while they look for permanent housing.

The second scheme is the Dormitory Housing Scheme where HDB lets out flats to companies in the manufacturing and engineering and construction industries to house their foreign unskilled and semi-skilled workers.

The demand for housing skilled foreign workers and professionals is rising. HDB's primary mission is to provide housing for our citizen families. It cannot cater to all the housing needs of the foreign workers. With so many Singaporeans on the HDB queue, it would not be justified to divert HDB's resources to build housing for skilled foreign workers and professionals.

Therefore, one solution is for JTC to buy HDB flats from the resale market so as to rent out these flats to foreign professionals in the industry. However, the Housing and Development Act only provides for eligible individuals to purchase HDB flats. The Bill thus seeks to amend the Act to enable corporate bodies, such as JTC, to purchase flats in the resale market by order published in the Gazette.

Controls

Mr Speaker, Sir, I will now cover the controls which we will put in place to ensure that the Bill is not likely to cause a significant impact on HDB resale prices nor create a social impact in the HDB estates.

First of all, JTC will be buying resale flats in the open market. It will not be competing with Singapore citizens for the subsidised direct-purchased new HDB flats. Those in the waiting list for new flats therefore need not worry about their waiting period being affected.

Secondly, as JTC is only buying a limited number of 3- and 4-room resale flats, its purchase should not unduly drive up HDB resale flat prices.

Third, the flats under this scheme will not be for foreign workers in the construction, ship-repair or similar industries. These workers will be housed in separate dormitory housing sites. This scheme is meant to cater to the housing needs of other foreign professionals in Singapore, ie, the employment-pass holders required by companies to support their major expansion projects and start-ups.

Therefore, in terms of social behaviour, we do not expect any difficulties when these foreign professionals move into these flats. In any case, there is already a check in place to ensure that owners of HDB flats regulate the behaviour of their tenants. JTC will also come under such regulation. The Housing and Development Act allows HDB to compulsorily acquire the flats if there is abuse by the occupants of the flats or breach of the conditions stipulated in the lease.

Sir, I beg to move.

Question proposed.

Dr Tan Cheng Bock (Ayer Rajah): Mr Speaker, Sir, I support this Bill because I understand the need to house our foreign workers who come here to work and contribute to our economy. Yet I am also concerned that their presence in our HDB environment can create problems because they come from diverse social, educational, linguistic and political backgrounds.

Let me share my constituency's experience of housing foreign workers. I remember when I first became a Member of Parliament in 1980, I was saddled with many problems, apart from the sunken aprons which I mentioned to the Minister before. There was this problem of many foreign workers being housed in the HDB flats in Teban Gardens. A few of these blocks were given to companies to house their workers. These workers were factory workers and not construction workers, and some of them were fairly educated. And I can tell Members that it made my life very miserable as a young MP, I would say unbearable, because I received so many complaints from my residents about their social behaviour.

Now, let me share with Members some of the problems encountered. When you group workers together in a block, the social behaviour of these workers can be very disturbing and embarrassing. Disturbing, because they drink, play loud music, yell and shout, and often fight. Embarrassing, because the women block allocated to them became the centre of activity of ill-repute which I think is not nice to mention in this House. The nocturnal activity in this block created embarrassment to my residents living nearby. While I understand the need to house foreign workers, I feel that it is only fair that these workers be spread evenly in all constituencies because it is quite natural for a corporate body like JTC to want to house their workers in the constituencies within Jurong. Therefore, Ayer Rajah, Boon Lay, Jurong and even Yuhua will be having more foreign workers than the other constituencies. I believe there should be a quota of foreign workers in each constituency. Misery must be shared equally by all.

Furthermore, they should not be housed in big numbers in individual blocks. The experience I have related to the Minister and to you, Mr Speaker, Sir, is a very real one. Therefore, we should not house them in big numbers in individual blocks but spread them out, similar to the way we spread our races living in each block. In other words, we follow the racial mix proportion. There should also be a proportion of foreign workers in each block.

I call for these changes because I remember that in the Committee of Supply debate, the Minister for National Development said that it was unlikely that these workers would be housed in new estates, like Pasir Ris. This again, I feel, is not fair as some old estates have image problems already. So we should not let these estates be further disadvantaged by too many foreign workers.

But I welcome his statement about the kind of foreign workers that will be housed in HDB flats. I am sure it has changed from the type of workers that were housed in Teban estate many, many years ago. But we always start off with very ideal conditions. It will slowly deteriorate when more and more demands are made by companies wanting to house their foreign workers. Therefore, we may start off with foreign professional and skilled workers, but later we might have to house factory workers again.

Lastly, allowing corporate bodies to purchase resale HDB flats will affect the HDB resale market depending on the number of such flats sold and bought. I wonder whether corporate bodies, like JTC, could buy flats from the resale market and also sell them on the resale market, or should they sell the resale flats back to HDB. Will there be a limit on the number of resale flats that corporate bodies are allowed to buy? I hope the Minister can give me some answers.

I support the Bill.

Mr Low Thia Khiang: Mr Speaker, Sir, while most of my concerns have been raised by Dr Tan, I have one request for the Minister to consider. Since there is a demand to house foreign workers, and we recognise that foreign workers have been contributing to the economy of Singapore, and the Ministry will allow JTC to buy HDB flats from the open market and rent them out, would the Minister also consider allowing the existing HDB dwellers, especially aged parents who are living with their children, who may not need to occupy the whole flat, to let out the whole flat to foreign workers as well?

Mr Lim Hng Kiang: Mr Speaker, Sir, I thank Dr Tan Cheng Bock for his support of the amendments. I would like to explain the changes in the approach to housing foreign workers over the years.

I agree with Dr Tan that, in the beginning, we have tended to concentrate the foreign workers within certain blocks. But if the Member will remember, we have undertaken some changes. For example, we have now let out land to some of the bigger companies to build dormitory housing for their own foreign workers so that this will be kept on the fringe of the housing estates and not in the middle of the housing estates. So companies, such as Keppel, Sembawang, and a few of these big companies, are now building purpose-built dormitory housing for their own foreign workers, particularly in the marine engineering, shipbuilding and construction industries. So I think that category of foreign workers would now be housed increasingly away from the HDB estates.

Within the HDB estates, we have about 4,600 units for the dormitory housing. These are meant for foreign workers employed in the factories. We also have 1,000 units under the Integrated Non-Citizen Housing Scheme. This is meant for the professionals and the skilled workers. By and large, such workers do not create social problems within the estates. But we must again see it in perspective. This totals less than 6,000 units, which is less than 1% of our HDB flats. I cannot imagine how we could set a meaningful quota which is only 1%. So we are spreading it as evenly as we can, granted that the companies want to house their workers close to the industrial estates which are also spread out throughout Singapore, although they are concentrated in the Jurong area.

I would say that, first, we are catering to the different needs separately so there will be less social problems. Second, the number is very small, less than 1%, and even with the 1% we are spreading it out evenly. Third, JTC will be given a limit of not more than 1,000 units for the immediate future. If you look at 1,000 units out of the HDB resale market of 30,000 units per year, I can assure Members that this will not cause undue impact on the HDB resale market. It is only 1,000 units out of 30,000 units. And JTC will not be involved in the business of buying and selling these units. Their purpose is to buy these units and rent out to their foreign professionals.

Mr Low Thia Khiang asked whether we can allow individual lessees to rent out their flats entirely to foreign workers. We do so under fairly strict conditions, ie, if they are on medical grounds, they are working overseas, or if they are given quarters by their companies, and so on. If there are valid grounds for the lessees to rent out their flats entirely, they can apply to the HDB for permission to do so.

Dr Tan Cheng Bock: Mr Speaker, Sir, I am wondering whether the Minister would be kind enough to keep Members of Parliament informed of the number of units that JTC has bought, say, in my constituency and also in Jurong and Boon Lay, and those close by to the Jurong Industrial Estate.

Mr Low Thia Khiang: Clarification, Sir. Would the Minister consider allowing aged parents who are living with their children to let out the whole unit?

Mr Lim Hng Kiang: If aged parents living with the children have no use of the flat, then they could easily sell the flat in the resale market. This would keep the family intact and also make sure that the primary objective of HDB flats being owner-occupied is kept.

Dr Tan Cheng Bock asked whether we will keep him informed. I will let JTC know that they should try and buy units which are evenly distributed in Singapore. I will assure Dr Tan that JTC is not just targeting the Jurong area, because many of these foreign professionals, are meant for expansion of the electronic industry, eg, the wafer fabrication plants which are not primarily in the Jurong area. They will be in the Woodlands, Tampines and Paya Lebar areas. For a start, I do not think JTC will buy the majority of the 1,000 units in the Jurong area.

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 Lim Hng Kiang].

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