SINGAPORE LAND AUTHORITY (Security deposit from voluntary welfare organisations)

Dr Chong Weng Chiew asked the Minister for Law (a) what is the rationale behind the Singapore Land Authority's requirement for 3 months' rental deposits or security in lieu from charitable voluntary welfare organisations (VWOs) since the rentals are being paid by their respective Ministries; and (b) this being the case, will the Minister consider having this requirement waived as the 3 months' deposits are quite substantial and can be better utilised by the VWOs.

Dr Chong Weng Chiew (Tanjong Pagar): Sir, I would like to declare my interest as the Medical Director of a voluntary welfare organisation.

Assoc. Prof. Ho Peng Kee (for the Minister for Law): Sir, like other prudent landlords, the Singapore Land Authority requires a security deposit to be paid by a voluntary welfare organisation renting State premises for the following reasons:

Firstly, to ensure that the tenant complies with the conditions of the tenancy agreement;

Secondly, to ensure payment of rental; and

Thirdly, to recover the cost of repairs and rectifications in the event of any damages when the tenant vacates the property.

As a general practice, SLA collects rental payments directly from the VWO. However, in some cases, the parent agency overseeing the VWO requests to pay the rentals directly to the SLA to avoid incurring late payment charges. Even for these cases, the security deposit is still required to ensure that the VWO complies with the conditions of the tenancy agreement as well as to cover the cost of repairs and rectifications arising from any damage to the property.

For these reasons, the Singapore Land Authority requires a security deposit, currently set at three months. SLA is prepared to waive the deposit for VWOs that have secured a guarantee from a parent agency or Ministry to make good any damages that may occur to the property. In addition, to ease the cashflow --- 2.00 pm

Mr Speaker: Order. End of Question time.

[Pursuant to Standing Order No. 21(3), Written Answers to Question Nos. 19, 20, 26, 27 and 28 are produced in the section, "Oral Answers to Questions Not Reached" (Cols. 147-152). Question Nos. 21-24 and 29-32 have been postponed to the sitting of Parliament on 9th July 2002.]