Speech by Mr. Louis Ng Kok Kwang, MP for Nee Soon GRC, at the Second Reading of the Postal Services (Amendment) Bill (Bill No. 5/2021)
This Bill ensures that our postal sector remains responsive to trends in the market.
On one hand, with many transactions now going paperless, the volume of letters sent through the post is decreasing. As one example of this trend, just in December last year, Ikea announced that it will be discontinuing its iconic Ikea paper catalogue after 70 years.
On the other hand, parcel deliveries has grown with the booming e-commerce sector. A study done in 2020 noted that Singapore’s business-to-consumer e-commerce market has been growing at a double-digit rate since 2017.
Already, the growth of e-commerce has strained our postal system which was mainly designed for letters. In 2019, SingPost was hit with a record $400,000 fine for failing to meet delivery standards. SingPost attributed the lapses largely to the rise in parcel deliveries.
The amendments to the Postal Services Act are timely for responding to consumer trends. The new public parcel locker network will also help to ease the load on our postmen and postwomen who work tirelessly to ensure that the postal system runs smoothly.
I have 3 points to raise on this Bill.
Effect on competitiveness of private parcel locker operators
First, the Bill will introduce a nationwide network of public parcel lockers at HDB estates, public transport hubs, and community spaces.
Ahead of this Bill, IMDA announced that it will roll out 1,000 parcel locker stations.
The public parcel locker network is intended to complement commercial parcel locker network in private residential and commercial spaces.
However, the scope of the public parcel locker network is extensive. This locks the private parcel locker networks out of a significant portion of the market. As a result, this may stifle innovation by the private players.
Private parcel locker operators have been in the market for some period of time. The industry is also fairly competitive with many options available to consumers.
With the introduction of the public parcel locker network, how will the Government continue to ensure that both public and private parcel locker network players remains competitive and continues to innovate?
Security of parcels in private parcel locker networks
Second, the new section 23R will allow the Postal authority to open and search a public parcel locker. It will also allow the Postal authority to detain and open any parcel in a public parcel locker.
This to mitigate risks to public safety and is consistent with the approach for postal articles.
MCI and IMDA have also stated that they will require the operator of the public parcel locker network to put in place security measures including video surveillance and presence sensors in the locker compartments. I understand this will also include cybersecurity protection measures.
Additionally, there is also collaboration with MHA and SCDF to ensure that the locker design and parcel handling meets safety and security requirements.
However, the powers for the Postal authority in section 23R and the security measures announced for the public parcel locker network do not necessarily apply to the private parcel locker networks.
The security risks that threaten the public parcel locker networks similarly apply to private ones.
Can the Minister clarify what measures will be in place, aside from existing Government powers under other laws, to address security risks for private parcel locker networks?
Third, the proposed amendments will implement Regulated Wholesale Access which means that SingPost will be required to deliver small packages for other delivery service providers into letter boxes.
The intention is to level the playing field for delivery service providers in the last-mile delivery market.
However, many delivery service providers currently provide parcel tracking services, where the parcels can be tracked throughout the journey.
With Regulated Wholesale Access, the parcels will be handed over to SingPost for the last-mile of delivery into the recipients’ letter boxes.
Without compatible tracking systems between the delivery service providers and SingPost, it may not be possible to track parcels throughout their delivery journey. This was a concern raised by Ninja Van in response to the public consultation for the Bill.
This would represent a step backwards in terms of the quality of delivery services offered to consumers.
Can the Minister clarify whether the Ministry has looked into how the trackability of parcels can be maintained throughout the delivery process?
This may be particularly important given that there is an additional point of handover of the parcels from the delivery service providers to SingPost, which increases the risks of mistakes.
Further, given that there are technologies available to the market to track the delivery of postal articles, is the Ministry looking into how tracked deliveries can be made the default in the Postal system?
Right now, consumers have to pay premiums and go through additional processes for the tracked delivery of letters and parcels.
If the technology is readily available, why not implement it across the board. The volume of postal articles that go through the postal system will help in spreading out the costs of implementation.
Notwithstanding these clarifications, I stand in support of the Bill.
Watch the speech here.