COMPULSORY ACQUISITION OF LAND IN POTONG PASIR FOR NORTH-EAST MRT LINE (Ex-gratia compensation)

Mr Chiam See Tong asked the Minister for Law, as regards the compulsory acquisition of land in Potong Pasir in connection with the construction of the North-East MRT line, (a) how will the quantum of ex-gratia compensation be determined firstly for land owners and secondly for tenants of those premises which are under the provisions of the Control of Rent Act and those premises which are not; and (b) whether compensation will be made to those residents who spent money to renovate their premises with the permission of the Building Control Department prior to the announcement in March 1996 that their properties would be compulsorily acquired.

Assoc. Prof. Ho Peng Kee (for the Minister for Law): Sir, ex-gratia payment is made only to landowners who meet certain eligibility criteria, not to tenants. The quantum of ex-gratia payment is the difference between the value of the acquired properties as at 1st January 1995, and their value as at the date of acquisition, in this case, 4th March 1996, subject to a ceiling of $2 million on the total compensation. This is so regardless of whether the properties are rent-controlled or not.

Sir, on the other part of the Member's question, the Chief Valuer will take into account the improvements of the acquired property in determining the market value in accordance with the Land Acquisition Act.

Mr Chiam See Tong: Sir, as regards those premises under the Control of Rent Act, now that it has been partially repealed in that the whole of Singapore has, in fact, been declared a designated development area, does the compensation for the old houses still have the same quantum before it was declared a designated development area?

Assoc. Prof. Ho Peng Kee: Sir, regardless of whether the property is controlled or not controlled, the Chief Valuer will take the same approach and assess what is the market value of that property. If the property is controlled premises and you sell it in the open market, you sell it subject to encumbrance, and you will get a depressed price.