SINGAPORE BUSINESS FEDERATION BILL

5.00 pm

Order for Second Reading read.

The Minister for Trade and Industry (BG George Yong-Boon Yeo): Mr Deputy Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Rationale for Bill - Formation of Singapore Business Federation

Sir, the purpose of this Bill is to enable the formation of the Singapore Business Federation (or SBF) as the new apex organisation to represent Singapore business interests both locally and abroad.

Currently, there is a wide array of business chambers and associations representing the various sectors of our business community. Each organisation plays a niche role - serving members and the economy along ethnic lines or by industry, professional or national groups.

The Singapore Federation of Chambers of Commerce and Industry (or SFCCI) was set up in 1978 as a national body representing local business interests and employer groups. Its members comprise the three ethnic chambers, Singapore International Chambers of Commerce (SICC) and Singapore Confederation of Industries (SCI).

Over the years, the SFCCI has done much to represent the interests of our private sector in local and regional forums, such as the NWC and the ASEAN Business Council. It has also helped many local businesses expand overseas and network with overseas partners. Let me take this opportunity to thank the SFCCI for the good work that it has done over the last 23 years.

Globalisation and rapid technological progress have fundamentally changed the way business is done worldwide. Our companies are relatively small and they face growing challenges overseas. They have to work together and leverage on each other's strengths. Even as they compete at home, there are benefits to be gained from working together to tap regional and global opportunities. Domestically, there is a need to strengthen the representation of the business community in forums, such as the NWC, ASEAN, APEC, ASEM and many bilateral business councils. In our bilateral free-trade negotiations, there are opportunities which our business community should help to identify. We therefore need a stronger collective voice to strengthen our tripartite structure, facilitate better co-ordination between public agencies and the business community and assist our companies when they venture overseas. This is much like the role Keidandren plays in Japan.

In 1998, Prime Minister Goh Chok Tong urged the SFCCI to review its structure so that it could play a more effective role in Singapore. In response, the SFCCI proposed the formation of a Singapore Business Federation funded by compulsory contributions from larger companies. The SFCCI recognises that its current policy of voluntary membership by business chambers and associations has not been effective. The business community in Singapore remains fragmented. We lack a strong and united private sector umbrella organisation.

The Government fully supports SFCCI's proposal. To operationalize it, I requested Mr Stephen Lee, Chairman of SNEF, in March this year to head an SBF Pro tem Committee and study in detail issues, such as the composition of the SBF Council, the Constitution of the SBF and the legislation for compulsory membership of larger companies. SFCCI's intention is to dissolve itself once the SBF has been formed.

Main recommendations by SBF Pro tem Committee

This SBF Bill, before the House, was drafted based on the recommendations of the SBF Pro tem Committee. The Committee has had extensive consultations with the local and foreign business community in Singapore. Let me now highlight the main recommendations of the Pro tem Committee which are contained in the Bill.

First, while the SBF should be run by the business community, it needs the Government to enact legislation requiring local companies with paid-up capital and foreign companies with authorised capital of $0.5 million and above to be members of the SBF. Mandatory membership is not new. Countries like Germany, France and Brazil have laws requiring companies to contribute to their chambers.

Second, we should not burden small businesses with the compulsory SBF subscription. With the cut-off set at above $0.5 million paid-up capital, most of our SMEs will not need to pay SBF fees. We allow membership of the SBF indirectly through a chamber or association. Therefore, the SBF can still represent the interest of small companies through existing chambers and associations.

Third, a Board of Trustees must be formed to protect the assets of the SBF as these assets will be mainly built up from the collection of mandatory fees and to ensure that the SBF does not deviate from its mission. Beyond such protection, the Trustees will not interfere in the workings of the SBF.

Fourth, we should not reserve seats in the SBF Council for particular chambers or associations, except for the three ethnic chambers. Nothing is static. As the nature of our economy changes, it is natural that some chambers or associations would become more important while others become less so. Some may have to be closed. New ones may have to be formed. The Council would draw up rules for representation which are fair and transparent. Recognising the important role of the international business community in Singapore, up to a quarter of the SBF Council will be set aside for foreign representation. Only the three ethnic chambers will be given permanent seats as they represent an important part of our multi-racial society.

There were some concerns that the SBF may supplant existing chambers and associations and reduce their membership. This is not the purpose for creating the SBF. So long as the chambers and associations serve their members meaningfully, they will continue to play important roles. In countries with compulsory membership like France, Germany and Brazil, the apex chambers work closely with the other chambers which continue to flourish alongside. In the same way, the SBF will work closely with existing chambers and associations to serve our business community.

Role of the SBF

The SBF, thus proposed, is a network and not an exclusive organisation. It provides a facility for information exchange and for promoting dialogue not only with the Singapore Government but with foreign governments as well. It should also advance the interests of Singapore businesses overseas and link up with Singapore business clubs and chambers established in other countries.

Key Features of Bill

Mr Deputy Speaker, Sir, this Bill addresses key aspects of the SBF Council relating to the representation of the three local ethnic chambers and foreign chambers, compulsory membership and payment of subscriptions by larger companies. The legislation also provides for the appointment of a Board of Trustees, prescribes supervisory powers for this Board and requires SBF to keep proper accounts for the Board to oversee. The Bill includes the steps to be taken for the dissolution of the SBF, should this be done one day. Let me now outline the key provisions.

Clause 3 of the Bill spells out the main role and objectives of the SBF.

Clause 4 specifies the requirement for the SBF Council to have the three ethnic chambers permanently represented and for up to one-quarter of the seats to be allocated to foreign chambers. The Pro tem Committee has proposed 20 seats for the Council. Apart from the ethnic and foreign chambers, the rest of the Council seats will be allocated to various local chambers, business associations and professional organisations based on an objective set of criteria, such as their membership base and the relative importance of different sectors in our economy. A few seats will be allocated to representatives who are directly elected by member companies, those which are not represented through chambers. In addition to the 20 seats, the Council will co-opt up to six members. This arrangement will ensure that the SBF leadership structure is not rigid and unchanging. The composition of the Council will be specified in the SBF Constitution.

Clause 5 provides that local companies with paid-up capital of S$0.5 million and above and foreign companies with authorised share capital of S$0.5 million and above shall be members of the SBF. Smaller companies who have an interest in the SBF can still join it. In fact, they are welcome to join it. Alternatively, they may find that joining an industry association or one of the ethnic chambers might serve their needs sufficiently. Paid-up share capital was chosen as it is a simple proxy for the size of a company.

Clauses 6 and 7 provide for the appointment by the Minister of a Board of Trustees and its functions. As the SBF will be financed by compulsory subscriptions, the Board's role is to ensure that the SBF acts in furtherance of its Constitution and the law, that the funds and assets of the SBF are properly accounted for and safeguarded, and that the Council members are fit and proper to hold office.

Clauses 8 and 9 pertain to the proper maintenance and audit of the accounts and records of the SBF and the Board's powers to access these records.

Clause 10 provides that the SBF cannot be dissolved without the prior approval of the Minister, and that the disposal of the assets of the SBF, upon dissolution, shall be approved by the Board of Trustees.

In order to perform its role effectively, the SBF needs adequate resources. As specified in clause 12, SBF members will pay an annual subscription not exceeding a cap of $1,500. The schedule of subscription fees will be drawn up by the SBF and must be approved by the Minister. Under the schedule proposed by the Pro tem Committee, the annual subscription ranges from $300 to $800. Based on the subscription rates proposed by the Pro tem Committee, the SBF will have an annual income of about $6 million to carry out its programmes and activities.

Clause 14 amends the Small Claims Tribunal Act to allow the SBF Council or an authorised SBF employee to recover any unpaid subscriptions through the Small Claims Tribunal.

In drawing up its recommendations on the Bill, the Pro tem Committee worked closely with MTI and consulted widely and intensively with the various business chambers and associations, with professional groups and with members of the general public. Many of the suggestions received have been incorporated into the Bill. I would like to take this opportunity to thank all those who have given us their valuable feedback.

Conclusion

Mr Deputy Speaker, Sir, the establishment of the SBF is an important initiative of the Singapore business community which the Government supports. With this Bill, the SBF will be the apex business organisation in Singapore representing the collective interest of Singapore businesses here and abroad. The Government supports this initiative because it will benefit our economy, enhance tripartite co-operation and strengthen our international position.

Sir, I beg to move.

Question proposed.

Mr Leong Horn Kee: Mr Deputy Speaker, Sir, I support the Bill as it serves to create a new super chamber or body to act as a powerful and concerted voice to speak for the business community. Similar federations of business bodies have been formed, as the Minister has mentioned, the Keidandren in Japan, and others elsewhere. In Britain, the Confederation of British Industry (CBI) has been formed for the same purpose.

Sir, I previously asked some Questions for Oral Answer in the House regarding this Bill. At that time, the Minister replied that the Bill was being formulated and he would give a more complete answer when the Bill is ready for presentation to this House. So I shall take this opportunity to ask a few questions.

First, on compulsory membership. According to clause 5(1) of the Bill, membership is compulsory for local companies with paid-up capital of more than $500,000 and foreign companies with authorised share capital of over $500,000. I have a few questions.

(1) Is it advisable to have compulsory membership by law, for both local and foreign companies? There are a myriad of local and foreign companies. Some may not find any reason or need to join the SBF, or some can be dormant even though they have the qualifying $500,000 paid-up capital. So why not make the membership voluntary, instead of making it compulsory? Under the compulsory scheme, as I heard the Minister, they would have collected $6 million from the membership fees. That seems to be a large sum.

(2) Why is there a difference in the definition used for paid-up capital for local companies and another definition used for authorised share capital for foreign companies? As I understand it, unless I am mistaken, authorised share capital may not necessarily equate to paid-up capital because full equity may not be paid by the foreign companies, although they may have the authorised share capital.

Next, representation of varied interests in the SBF. Given that the SBF will be a large gathering of companies, I wonder how it can be effective in representing the wide and varied interests of all its members. Would the smaller companies feel that they have lesser representation because the Council could be dominated by the big boys and the prominent businessmen?

Sir, on the role of the SBF vis-a-vis other business bodies, a query I have is how is the SBF going to operate effectively. At present, the Bill provides for three local chambers of commerce and industry, ie, Chinese, Malay and Indian, to be represented on the Council. But there are also many other business and trade bodies that are already in existence. They speak for their own industries' interests. For example, there is the Association of Small and Medium Enterprises (ASME) and there is also the Singapore Confederation of Industries (SCI). What are their roles now vis-a-vis the SBF? The Minister has explained that the SFCCI, which is the confederation of chambers of commerce, is going to be closed. But what about the SCI? Will it also become defunct or will it be invited to join the SBF as a component member? I would like to ask the Minister to enlighten us.

Sir, I support the Bill.

Mr R. Ravindran (Bukit Timah): Sir, the introduction of this Bill is timely as it will see the birth of a new and powerful organisation which can represent the interest of all businesses. It will also help look after the interest of the business community within Singapore and represent Singapore's business interest overseas.

I am happy to note that the SBF will provide mandatory representation on its Council for the three ethnic chambers of commerce. This has been a matter of serious concern to the three chambers concerned.

Sir, on this note, I would like to ask the Minister what is going to happen to the other two organisations, ie, the Singapore Confederation of Industries (SCI) and the Singapore International Chamber of Commerce and Industry (SICCI).

I would also like to ask whether there will be any mandatory provisions to provide for these organisations to be represented on the SBF Council or whether there will be special provisions made in the Constitution of the SBF to provide for the membership of these two organisations on the Council itself.

Sir, it is also unclear as to what exactly is the full scope of activities of the SBF, as the Constitution of the SBF has not been disclosed to-date. Perhaps the Minister can highlight the principal areas SBF will be concerned with. This is a matter of significance as some of the existing chambers rely on certain activities like issuing certificates of origin and bar coding as a source of income, and any competition from SBF in these areas will affect the income of these chambers.

Sir, let me move on to the appointment powers. Clause 6(1) of the Bill gives the Minister the power to appoint the Board of Trustees. The Board of Trustees, in turn, is given the power to ensure that Council members are persons who are fit and proper to hold the position. I am puzzled as to why the Council is given the power when the qualifying criteria should be laid down in the Constitution of the SBF itself, together with other qualifying criteria, eg, the person should not be a bankrupt or have criminal records. In addition, it would be a better idea if the tests of fit and proper persons are clearly stated, ie, what are the criteria when we mean "a fit and proper person", so that everybody knows whether he falls within these criteria. If the individual is not a fit and proper person, then he should be disqualified from standing for the elections to the Council right at the beginning.

Sir, I would also like to ask the Minister why the Board of Trustees must approve the appointment of the members to the Council after they are properly elected by the members of the SBF in an election within the SBF. This unnecessarily curbs the freedom of the members of the SBF from electing members who they feel will represent their interests. The instances, of when the Board of Trustees should not approve these Council members who are duly elected, are also not spelt out clearly anywhere in the Bill, unless it is going to be provided for in the Constitution of the SBF. I would suggest that this clause be deleted as it curbs the right of the SBF members to decide who represents them. Perhaps the Minister can share with us the experiences of some of the countries where there are similar organisations on how elections of their council members are done.

Sir, if the concern of the Government is that the Government view should be voiced in the Council, perhaps the model of the Law Society Council is one that could be considered. The Law Society has a Council where three Government appointees are appointed to represent certain viewpoints. This is a model that the Minister could perhaps consider for the SBF. Otherwise, it will be seen by some members that the clause impinges on the right of choice of SBF members.

Sir, let me now move on to the exemption powers of the Minister. Clause 5(2)(c) gives the Minister the power to exempt companies from becoming members of the SBF. I would like to ask the Minister for clarification on the type of companies which will be exempted from membership. A matter of concern among some companies relates to holding companies that have several single-purpose companies, eg, shipping companies and property companies. These are done primarily to protect the parent company and other sister companies in the group from legal liabilities. In the case of property companies, it is a requirement that a separate company be set up for each property development project. Will exemption be granted to such companies?

Sir, let me now move on to subscription monies. Clause 12(3) caps the maximum amount of subscription fee at $1,500 per year. I would like to ask the Minister the exact subscription that will be collected from all companies which qualify to be members as of today. I think the figure the Minister highlighted is $6 million. I would like to ask the Minister whether he would consider a lower subscription amount as there are many companies which are going through a difficult phase now because of the economic climate.

Sir, I now move on to the last topic. I am happy that companies with a lower paid-up capital can become members of SBF, as many may find a benefit in joining SBF because of the many activities and programmes that it may offer. But I would also like to ask the Minister whether:

1. partnerships and sole proprietorships can also become members of SBF, besides companies;

2. professional partnerships or sole proprietorships, eg, lawyers, accountants and doctors, can also become members of the SBF; and

3. SBF will allow for individual members, as some existing chambers allow for individual membership from certain categories, eg, lawyers, IT professionals, etc.

Sir, these are my main concerns. Despite all these comments, I am confident that, with strong support from the business community and the broad spectrum of support from all larger companies, the SBF will grow to become a dynamic organisation. I am also confident, as the Minister highlighted, that the SBF will develop into a strong and united private-sector umbrella organisation.

Sir, on that note, I support the Bill.

Mr Tay Beng Chuan (Nominated Member): Mr Deputy Speaker, Sir, I support the Bill in principle to establish the Singapore Business Federation (SBF) to take over the role of the Singapore Federation of Chambers of Commerce and Industry (SFCCI) as the apex body of the Singapore business community.

Mr Deputy Speaker, Sir, the SFCCI has, since its inauguration in 1978, been depending on its five constituent members, ie, Singapore Chinese Chamber of Commerce and Industry, Singapore Confederation of Industries, Singapore Indian Chamber of Commerce and Industry, Singapore International Chamber of Commerce and Industry, and Singapore Malay Chamber of Commerce and Industry for financial support. Despite its financial constraints, it has fulfilled its role in maintaining a useful channel of communication between the business community and the Government, as well as a close working relationship with its counterparts in ASEAN and other countries. It has represented and safeguarded Singapore's interests actively and consistently in ASEAN CCI, ICC and other international fora.

To be effective in its role, the SBF will require much financial resources to fund its activities, especially in economic research and overseas assignments. Since the business community will be the eventual beneficiary of these services, it is fair and reasonable for the Government to introduce this Bill to enable SBF to collect a small annual contribution from the larger and more successful companies to fund its activities. And I sincerely hope that with the stronger financial resources and continued support of the SFCCI constituent members and other business associations, the SBF could play a much more effective role in representing the interests of our business community within and outside Singapore.

Mr Deputy Speaker, Sir, the SFCCI has effectively been functioning as the apex body of major business chambers and associations in Singapore, successfully carrying out this function in close cooperation with its five constituent members without having to recruit direct corporate members in competition with its individual constituents. It has, over the years, accumulated a wealth of practical knowledge, networking experiences and negotiating skills in dealing with the national and international issues which are of great concern to the business community. It is, therefore, in the interests of the SBF to tap the existing human and other resources of the SFCCI and its five constituent members to perform a larger role in the New Economy. Naturally, we hope that SBF will stay with this practice and avoid competing with its constituents in recruiting corporate members directly.

The proposed Bill, however, provides that every local company with a paid-up share capital of or above the amount of $500,000 shall automatically become a member of the SBF and be expected to pay an annual subscription of up to $1,500 to SBF in any calendar year. This has raised a great deal of concern among the SFCCI constituent members and the business community.

The SFCCI's constituent members and many other trade associations in Singapore want to know their role in relation to the role of SBF in addressing the needs and problems of the individual companies and the specific industries. Will the SBF choose to ignore or compete with all the existing associations with a view to replacing or diluting them in representing the interests of their members? Rather, it is hoped that SBF will encourage smaller companies with less than $500,000 paid-up share capital to join any other chambers of commerce and industry and business associations so that their individual business needs can be catered to more effectively by appropriate associations within the respective industries.

The Bill has clearly spelt out the payment obligations of companies affected but failed to specify the services and benefits they will enjoy as members of SBF. Many local and foreign companies question the need to compel them to be members of SBF when they are already members of existing business chambers and trade associations. These companies want to know what specific kinds of membership services the SBF will provide and whether there will be a duplication of service at their expense.

There are further concerns as regards the compulsory membership to SBF and the quantum of annual contributions. Companies are worried that the SBF Council could, at the slightest excuse in the future, obtain the Minister's approval to increase the annual subscription up to the maximum of $1,500 under clause 12(1) of the Bill. In addition, many SMEs are also worried that the Minister may lower the amount of paid-up share capital under clauses 5(1) and 5(2)(b) of the Bill to compel more SMEs to be members of SBF for fund-raising purposes in the near future. This scenario may cause undue hardship to individual companies and there is no way for them to avoid payment except to wind up their business in Singapore. Companies, therefore, want to know what are the safeguards against amendment of these clauses.

The business elites and professionals have also expressed their concerns over the proposed appointment of the Board of Trustees by the Minister to oversee the work of SBF as provided under clauses 6 and 7 of the Bill. One possible interpretation of the two clauses is that it will be the Minister and the Board of Trustees appointed by him and not the general membership of the SBF or its Council, that will ultimately decide who will run the SBF and how SBF should be run. The strong Government presence within the SBF inevitably raises the question of accountability and whether the SBF will be able to function effectively and independently as a credible and representative body of the entire business community in the private sector.

Many want to know what kind of persons are deemed to be fit and proper persons to serve on both the Board of Trustees and Council of the SBF. What will happen if the nominees elected by SBF members or the local ethnic and foreign chambers of commerce and industry cannot be accepted by the Minister? Could we successfully encourage the more successful and capable business elites and professionals to serve in the SBF Council with pride and commitment? Can we promote spontaneity, creativity and initiative in the SBF to expect its Council members to speak their minds in representing the specific industries without any fear and inhibitions? Can we ensure that the SBF is not perceived as another Government organisation or statutory body?

Mr Deputy Speaker, Sir, I have painstakingly voiced the genuine concerns of the business community over the specific provisions of the Bill because I strongly believe that we need a strong and creditable SBF to serve as an effective apex business body for the private sector. The SBF must truly represent the entire Singapore business community in the tripartism of our economy and in the international scene. It is important for the Minister to address the issues raised at the outset and make appropriate amendments to the Bill if necessary. This is to ensure that we reach a national consensus in establishing the SBF for the benefit of all in Singapore.

BG George Yong-Boon Yeo: Sir, I would like to thank Mr Leong Horn Kee, Mr Ravindran and Mr Tay Beng Chuan for their very thoughtful comments about the Bill.

Let us take a step back and ask ourselves why such a Bill is necessary. I agree with Mr Ravindran and Mr Tay that it is important that the SBF is a business organisation and not a Government organisation. Our objective is not to have a Government voice in it through our appointees, like in the Law Society, not at all. Our objective is really to enable the SBF to do the kind of good work which the SFCCI has done in the past and to do much more because of all the challenges that we are facing, brought about as a result of globalisation and global competition.

SFCCI, within its framework, as Mr Tay Beng Chuan has pointed out, has done an excellent job. But because of the voluntary nature of the organisation, it faces certain limitations and the principal limitation is a financial limitation. And when Prime Minister Goh challenged SFCCI to restructure itself to become more effective, it came back to say, "Look, the only way is: we must have compulsory membership of larger companies so that it has got a steady flow of income." So their request to us was to legislate. Once we legislate, we have responsibility. And since the power to legislate is vested in this House, the responsibility must come back to this House. Hence, the need for a Board of Trustees. We cannot have one without the other.

Mr Leong Horn Kee asked a fundamental question: is it necessary, in the first place, to have compulsory membership? Our first choice was never to have compulsory membership which is why we never had this Bill all this while. The fact is we need it now and since we need it, and since it is this House which would give power to the SBF to collect payment, we must set limits to it to ensure that the money collected and the assets accumulated are properly protected. Hence, the need for a Board of Trustees, who will be responsible people, people who are respected by Singaporeans, by members of the business community and it is for them to make sure that when the Constitution is amended, that it is amended with the mission in mind. And that when Council members are appointed, nominated or elected, these are people who are fit and proper.

Should the Ministry be involved? The Ministry should not be involved. Should Parliament be involved? Only when big things are impacted upon. But as to issues like whether professional groups should be allowed membership, what the detailed aspects of the Constitution are, I would say, let us go back to one of the fundamental principles, which is that SBF is not a statutory board, it is not a Government organisation, it should be left mostly to run its own affairs. Therefore, many of the comments which have been brought up, which are very important comments, are, in fact, built into the heart of the Bill, which is a balance between having a business federation which is independent and creative and accountable to its own members, and one which, because it relies upon Parliament to give it powers to collect subscription, is also ultimately responsible for the mission which we have set out in this Bill.

Let me now go into some of the detailed questions which have been raised by our three Members of Parliament. Mr Leong Horn Kee asked about the differences in definition for locally registered companies and foreign companies. There is a difference because, for local branches of foreign companies, there is no reporting mechanism for paid-up capital. So we have to use the best proxy, which is authorised paid-up capital. About a thousand local branches of foreign companies would be involved.

As to the "fate", to use the language of by Mr Leong and others, of organisations like ASME, SCI, SICC, frankly, that is not Parliament's business. These are private organisations. It is for them to decide how they should react to the formation of SBF. How they should work the SBF is something between them and the SBF to decide. I have no doubt that SBF would not want to duplicate or replicate functions already effectively performed by these chambers. In fact, it is completely in the interest of the SBF to work with an economy of effort, to work through and with existing organisations. Some of these organisations like SCI had done a very good job and I see no reason why there should be any diminution in their roles. Others are less effective and they will have to respond to the fact that there is now a new organisation with a clear purpose and with a steady source of income to fund its activities.

Mr Ravindran asked about issues concerning certificates of origin and bar codings. Where these are franchises given by TDB, it is really for TDB to decide whether these franchises should continue in the future. Obviously, TDB would make no change without consultation with the various agencies involved. As to questions concerning the exemption clause, single purpose companies like shipping companies and property companies, MTI has had discussions with the Pro tem Committee, which in turn has had discussions with the industry players involved. The Pro tem Committee told me that once you allow for certain groups to be exempted, it is very difficult to draw the line because there are always worthy causes to be exempted. My response to them is, "Well, I will have this clause in the Bill so that if I have to give an exemption, I can. But you must advise me whether you are making any recommendations." To-date, the Pro tem Committee has recommended no exempted category. So that is the position as it stands.

On subscription rates, although we have set a cap at $1,500, the Pro tem Committee has in fact, worked out a schedule ranging from $300 to $800 for companies of different sizes. They will take a practical approach and if these are reasonable numbers, I, as the Minister, will approve them. I do not intend to second guess why they set certain schedules for certain groups of companies. Can they raise this subscription lightly, a point raised by Mr Tay Beng Chuan. No, they cannot, because firstly, they must have my approval. I am accountable to this House and if I want to go beyond $1,500, I have got to amend the Act which cannot be done lightly. In the same way, the fear that we may lower the threshold of $0.5 million and suddenly make many SMEs pay up, this is something that we cannot do lightly. This is something which we can only do when we come back to this House. I am sure if we were to do that, many of you would have your views.

Mr Ravindran asked whether partnerships and sole proprietorships will be allowed as members of the SBF. That is for the SBF to decide. I have told them that they should consider it and I believe they are favourably disposed towards that idea. In fact, the SBF Pro tem Committee does not see the SBF as representing only the interest of larger companies who are its compulsory members. They see themselves as representing all businesses in Singapore, including SMEs. I believe that the interest of SMEs would be adequately represented, even if they are not directly members, by chambers such as the Chinese, Malay and Indian chambers and ASME. But of course, if an SME does not want to be a member of such a chamber, but wants to be a direct member of the SBF, it is free to do so. We allow for a certain amount of healthy competition but, as Mr Tay Beng Chuan pointed out, without wanting to cannibalise the membership of existing chambers and associations.

The question of SICC, which was raised by Mr Ravindran, is an important one. We had draft structures circulated to the business communities earlier and some of them were concerned that the SICC may not be able to represent national chambers sufficiently. What we have done is to say that in the Bill, we allow up to one quarter of the Council's seats to be allocated to foreign chambers, but it is for the SBF to draw up rules in consultation with the foreign business community on how best they should be represented. And I see the compromise being a combination of representation by the SICC and by the chambers of the major national groups which are in Singapore. I believe I have answered all the questions.

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. - [BG George Yong-Boon Yeo].

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