Speech by Mr. Louis Ng Kok Kwang, MP for Nee Soon GRC, at the Second Reading of the Housing and Development (Amendment) Bill (Bill No. 32/2020)
Madam, this Bill makes two key changes. First, it enables banks to use HDB loans as collateral to borrow from MAS.
Second, it empowers the HDB to seize flats in certain cases where homeowners provided falsehoods to HDB.
I agree with these changes. They help banks release funds into a tight economy. They penalise the use of falsehoods by HDB applicants.
I have three clarifications to make.
My first clarification is about HDB bank loans.
The Bill allows banks to use HDB loans granted by them to obtain credit facilities and repurchase transactions from MAS. Previously they couldn’t.
This empowers MAS to inject more liquidity into our financial system. Indeed, MAS has recently created a new credit facility that allows certain banks to pledge home loans as collateral.
But there are risks. In this crisis economy, homeowners will increasingly feel the brunt of unemployment and salary cuts. More home loans will become delinquent or default.
MND itself said in 2018 that prolonged unemployment and drops in household income are two main reasons why households fall into mortgage arrears.
If households cannot repay their loans, banks will find it harder to repay MAS.
To clarify the significance of this amendment, I have two questions.
First, can Minister share data on what has been the default rate of HDB bank loans in the past five years?
Second, what is HDB’s forecast of the default rate of HDB bank loans in the next 12 months?
I was initially going to ask if HDB will continue to suspend late payment charges on HDB mortgage arrears. I’m glad Minister has announced that given the current economic conditions, HDB will further extend this to 31 Mar 2021. This is a much needed lifeline for many Singaporeans.
Sir, ensuring that homeowners can repay their bank loans is in the interest of homeowners, banks and our financial system.
Falsehoods, transfers, acquisitions
My second clarification relates to falsehoods, transfers and acquisitions.
The Bill gives HDB new powers to compulsorily acquire flats in certain cases. In particular, HDB now has the power to do so in cases where applications for flat ownership in an acquisition or transfer between relatives contained a false or misleading statement.
I have two sets of questions relating to this proposal.
One, in relation to both the existing Section 56 and to the new amendments, can Ministry clarify whether homeowners are allowed to amend the false or misleading statements in HDB applications they have submitted? If so, what are the channels for them to amend their statements?
We must take a strong stance against the use of falsehoods in HDB applications. But where such falsehoods are assessed to be innocent or non-material, we should provide channels for voluntary correction.
Two, the amendment of Section 56 introduces the terms “transfer” and “acquisition”. There is no definition for either term in the Act for the purpose of Section 56.
Can Minister clarify what situations do “transfer” and “acquisition” refer to, respectively?
In particular, does the definition of “transfer” in Section 56 differ from its definition in Section 49, which is expressly stated to cover only Section 49?
Section 56 has significant impact on lives, as it empowers HDB to compulsorily acquire flats. Clear definitions with examples, provided on Parliamentary record, will help avoid any doubt in its interpretation.
Cat ownership in HDB flats
My final point is that we have not gone far enough in reviewing our HDB policies.
The policy of not allowing the keeping of cats in HDB flats has to be reviewed and changed. I’ve spoken up about this for more than a decade now.
I know this is not part of this Bill but I hope Minister will address this point.
Let me reiterate what I said in this House in March this year, “HDB has stated that cats are generally difficult to contain within the flat. When allowed to roam indiscriminately, they tend to shed fur and defecate or urinate in public areas, and also make caterwauling sounds, which can inconvenience your neighbours.
It does not make sense that one is allowed to keep a dog, and now a big dog, but not a cat, not even a little kitten. Dogs can also shed fur and defecate or urinate in public areas. What is more, they bark.
HDB’s concerns can be easily addressed. We can ensure that pet cats do not roam indiscriminately and are sterilised.
Sterilised cats do not make caterwauling sounds. I have seen firsthand how all these simple measures can be taken and people can keep cats in their flats without affecting their neighbours.”
In response to my question, MND has said, ‘when HDB receives a complaint, they go down and investigate. If the cat is not causing any disamenities, the resident will not be asked to remove the cat”.
I appreciate this reply but my question then is what is the point of having a rule that we do not actively enforce?
So many people are already keeping cats in HDB flats. Many of us as MPs see this during our home visits and some of us even take photos with our HDB residents and their cats.
Sir, I sincerely hope that MND will amend the Housing and Development (Animals) Rules to reflect what we already accept in reality – that HDB residents are allowed to keep cats, which can be removed if found to be causing disamenities to the community.
Sir notwithstanding my clarifications, I stand in support of the Bill.
Watch the speech here
Watch the response here