CHARGES FOR AMENITIES/FACILITIES (Review)

Mr Noris Ong Chin Guan asked the Minister for Trade and Industry, in view of the uncertainty of the economic situation ahead, whether he will consider it necessary to review the charges for amenities/facilities (for example utility rates, rental charges, petrol prices) so that these charges will not be too burdensome particularly on small and medium enterprises and on Singaporeans from the lower income group.

BG George Yong-Boon Yeo: Mr Speaker, Sir, though our economy did very well last year, the performance was uneven. Some SMEs, particularly those in the domestic sectors, did not do as well as those companies which benefited from the strong external demand last year. We understand the plight of these smaller companies trying to keep their businesses viable. Wherever possible, we have kept business costs down. For example, the CPF was only partly restored. We were mindful of the cost impact on businesses if the CPF was restored in full too quickly. Despite the improved business outlook at the end of 1999, the rental rebates for HDB and JTC industrial premises were extended by another year, to the end of last year. Last year, the manufacturing sector recorded healthy growth but the recovery was uneven. Hence, JTC and HDB decided to lift their rebates gradually. Only half the rebate was removed on 1st January 2001. MTI is monitoring the economic situation closely. JTC and HDB will review their rental rates in the middle of this year.

We should avoid distorting the general market prices for Government goods and services by directly subsidising them. To help small companies and the lower-income groups, the Government will continue to give rebates and provide special economic assistance schemes to these groups directly.

Mr Noris Ong Chin Guan: Sir, would the Minister consider the setting up of a price commission or Government watchdog committee to review prices set for products and services consumed by the masses where the suppliers enjoy a monopoly or cartel advantage? CASE has been very active recently, but could be likened to a toothless bulldog.

BG George Yong-Boon Yeo: Sir, it is always a popular idea to control prices to make sure that increases are ameliorated. But we operate a market system and, to the maximum extent possible, we should allow the market to operate. Where there are monopoly powers, then the regulators involved must make sure that either the monopolies are regulated or broken up or the sector made contestable.

CASE has performed a very useful role being a consumer watchdog. I do not think it is toothless at all. And it has been lobbying MTI very hard for us to establish a Fair Trading Act. We are now working with CASE to look at how such an Act can be legislated. It should be done in a way which does not make the market operate less efficiently or less flexibly. Many MPs in this House, including Mr Chiam See Tong on many occasions, have raised the need for such an Act. MTI has not been very enthusiastic about it because it creates other problems. But we are prepared to look at an Act which is minimalist and which allows the small consumer to seek redress at low cost, and we can make use of the Small Claims Tribunal for this purpose.

Mr Jeyaretnam: Mr Speaker, Sir, very early in this Parliament, I proposed the appointment of a parliamentary committee to check on price increases. May I know from the Minister what is the objection to an independent committee looking into price increases of utilities, like transport, water, light and other utility services?

BG George Yong-Boon Yeo: Sir, MTI monitors regularly the index of Government fees and levies. Even though this forms only a small proportion of total cost, it is important for us to monitor these prices because we are responsible for them. There are statutory boards which have a direct responsibility to look at these prices like PUB, LTA, the Public Transport Council. It is their job. Over and above them, we have Ministries. And the Ministers are accountable to Parliament.

Mr Jeyaretnam: Will the Minister please answer my question? What is the objection to an independent committee monitoring increases in prices?

BG George Yong-Boon Yeo: Mr Speaker, Sir, I do not think there is a more independent committee than Members of this House. If what Mr Jeyaretnam is referring to is technical monitoring of the statistics, we already have statistical agencies monitoring these numbers, unless Mr Jeyaretam is casting doubt on the professionalism of these agencies. And if there are cases which have attracted Mr Jeyaretnam's attention that our data gatherers have not been acting professionally, I will be very happy to look into his complaint.