[Delivered in Parliament on 20 Jan 2015]Introduction
Mdm Speaker, in between the fist and second reading of this Bill – a period of two and a half months – two stories about foreign worker accommodation in particular, caught the public eye. Both stories unwittingly put the importance of this Bill and the scope of the work ahead to better manage and look after the well-being of our foreign worker population, into acute perspective.
On the ground
On 6 December 2014, the New Paper reported that four Malaysian foreign workers who were employed as cleaners died in a fire at a Geylang Lorong 4 shophouse, in Singapore’s worst fire in 10 years. Two firemen and eight other individuals suffered injuries from the blaze. The unit in question – reported to be an area only slightly bigger than 1,300 sq ft – had nine rooms, each equipped with bunk beds, a tiny kitchen and a toilet. The Malaysian Star newspaper, STOMP and a Today article reported that premises was occupied by some 100 foreigners from China, India, Bangladesh and Malaysia, partitioned into 11 units of rooms each occupied by about 10 people. The local Chinese paper Shin Min Daily News on the other hand reported that the affected unit of the three-storey walk-up apartment had eleven rooms, each occupied by up to eight workers, which makes for a total of about 88 people in a single apartment.
In a separate piece of news on 29 Dec 2014, the New Paper reported that eight blocks of HDB managed flatted factories at Tampines Industrial Park A, comprising of workshops, furniture manufacturers and warehouses – were operating as a (I quote) “secret dormitory” (unquote) for 1000 foreign workers, in clear violation of HDB rules.
While these stories were headline-grabbing, other articles pertaining to our foreign workers continued to make the news. On 21 November 2014, the Straits Times reported that a spot check by the Migrant Workers’ Centre found more than 50 construction workers from Bangladesh and India crammed in two small apartments in Selegie Road with the report adding that the “men slept shoulder to shoulder, amid rotting food and soiled clothes”. The same article reminded readers that the paper had raised several reports on unhygienic and overcrowded foreign worker housing recounting one an incident of a Punggol HDB construction site where hundreds of workers had to use choked and broken urinals, and another story covering the plight of about 5000 workers living at Tuas View Square in factory-converted dormitories infested with rats and mosquitos.
A Business Times story the same month reported that of the 770,000 work permit holders, only 200,000 stay in purpose built dormitories that this Bill will regulate, with requirements for a little less than double the amount. The rest of our foreign workers stay in a variety of places like the putatively illegal dormitories in Geylang and Tampines, in HDB flats in some cases, and at temporary housing at construction sites all unregulated by an omnibus act of parliament – notwithstanding the spaghetti bowl of guidelines and restrictions governing such accommodation from the Urban Redevelopment Authority (URA), Singapore Civil Defence Force (SCDF), Public Utilities Board (PUB), the Building and Construction Agency (BCA), National Environment Agency (NEA) and the Housing and Development Board (HDB).
Better foreign worker dormitory employment standards for all foreign workers
During the second reading of the Employment of Foreign Manpower Bill in 2012, the Minister informed the House that in 2011, MOM conducted close to 800 inspections of premises used as foreign worker housing and that in 2009, enforcement action was taken against 1,800 employers for housing their workers in unacceptable conditions. A recent Business Times article reported that the first half of 2014 saw 360 inspections. However, the large number of these continuing violations and inspections suggest that Singapore, a first world economy by any stretch, does not host a robust enough framework governing the housing of foreign workers, even as this Bill is a step in the correct direction.
Mdm Speaker, the explanatory note of the Bill defines “foreign employee dormitory” to mean a premise that provides accommodation for more than 1000 workers. By this threshold, the Bill does not address the sort of accommodation at the centre of the Dec 6 Geylang fire and “secret dormitories” such as those in Tampines. I would like to ask the Minister what plans are envisaged to reduce this threshold number within the context of this Bill since it is explicitly suggested in the explanatory note and separately, how this figure of 1000 was arrived at in the first instance, in view of the need for greater oversight, regulation and enforcement across this industry, than is currently the case.
Separately, a Straits Times report of 19 August 2014 reported, rather oddly, that there were at least 5,000 empty beds still available at purpose-built dormitories that will be covered by this Bill. The reason for this sudden turn of events was put down to more construction firms being permitted by the authorities to set up foreign worker quarters on the sites of major building projects, including LTA and HDB sites.
I recognise that manpower proximity to the workplace helps reduce costs for businesses particularly construction contractors. To this extent, government policy should support such considerations wherever possible. However, rendering such operational flexibility for business would have been an opportune time to introduce clear licensing requirements, regulatory standards and a penalty framework for such temporary foreign worker quarters. This would have greatly supported contractors on the one hand, and improved the living conditions of the foreign workers on the other.
In drafting this Bill, I would like to enquire if the Ministry considered for example, introducing a separate category or categories of licencing for premises that operate as smaller foreign employee accommodation below the threshold number, so as to bring many more dormitories and places of accommodation for foreign workers under a licencing framework? Such a broad strategy would be aligned with the purpose of the Bill, as spelt out in clause 4, which seeks to establish certain accommodation standards for the foreign employee dormitories; for the appropriate mechanisms to ensure adherence to those very standards, and to promote the sustainability of and continuous improvements in the provision of services at foreign employee dormitories.
One possible way to support SMEs, and small businesses and contractors on the one hand, and our foreign worker community on the other, is for the Government to consider building and managing some dormitories for our foreign workers. For example, companies that employ 100 or less foreign workers, being more sensitive to cost pressures can be eligible to house their workers in Government-built and operated dormitories which set the standard for the entire industry. The entry of the Government into this sector can be modelled along the entry of Ministry of Education into the kindergarten business, which is to provide good pre-school education and more importantly, to catalyse improvements in this sector. If deemed appropriate, a fraction of the foreign worker levy can be used to establish such dormitories with a subsidy for small companies that show real and sustained productivity improvement in their operations.
Who is ultimately responsible for the health and safety of foreign workers?
Madam Speaker, Part 5 of the explanatory statement of the Bill states that the Minister by way of subsidiary legislation, can determine that several buildings on different parcels of land be regarded as a single boarding premises and whether all the beds therein are to be counted to determine if the total threshold number is attained. This is a positive move as it would prevent savvy operators who would nonetheless operate assiduously to work around the 1000 bed threshold by all means, effectively negating parliament’s intent for example, by creating sister companies thru family and friends. I would like to ask the Minister whether the Ministry has determined how many additional dormitory operators are likely to come under this scenario as spelt out in the explanatory note and how many more beds, so to speak, will come under the licencing framework as a result of this envisaged subsidiary legislation.
This Bill’s intention to determine that several buildings on different parcels of land can be regarded as a single boarding premises, should also interest potential investors. As recently as 2008, Avery Strategic Investments, an entity that was then 97% controlled by Morgan Stanley Real Estate bought three foreign workers’ dormitories for $153m when Jurong Town Corporation offered to sell three dormitories comprising a total of 13,544 beds. An officer of the minority shareholder, Averic Capital Management, was then quoted as saying, “as the Singapore economy grows, likely so will the dormitory business. We’re hopeful the economy remains robust; then there’ll be more opportunities to invest in this asset class.”
About two and a half years later, Morgan Stanley sought to exit the dormitory business citing a dearth of sites made available for dormitory development by the government, preventing them from enlarging their portfolio to spin-off the business into a dormitory real estate investment trust. It was reported that the entity received expressions of interests ranging from $375 million to $450 million, a whopping $100 million more than the total cost of the assets it purchased a mere three years prior.
Madam Speaker, it is not in doubt that the market is the lifeblood of any society. However, for industries and sectors that have significant socio-cultural implications for an urban and high-density society like Singapore, the market approach should go hand in hand with responsibility towards our foreign workers. Away from the dizzying dollars churned by the financial industry and the heady world of mergers and acquisitions, the concern of many Singaporeans and members of this house by virtue of this Bill, is primarily over the health, security and safe lodging of our foreign workers.
To this end, in the Ministry of Manpower’s press release on the Bill dated 4 November 2014, under the section covering penalties – it was stated (and I quote) “that the holder of the dormitory licence will be the dormitory operator responsible for the day-to-day running of the dormitory. Nonetheless, the premises may be owned by a separate proprietor who either sublets the premises to the operator for use as a dormitory; or appoints the operator to manage the daily operations on his behalf. In such instances, (the Ministry) would hold proprietors accountable where they, rather than the operators, have more control, for example, in making repairs or alterations to the premises.” (unquote)
I seek some clarifications on this point in the press release since the Bill does not make specific reference to the degree of control as apportioned between for example, the ultimate owner of a foreign employee dormitory and the licensed operator in the event of an infraction. For example, how far would an owner or a corporate entity be held liable if it can prove it had no control in making repairs and alterations to a boarding premises? Does that mean it is not responsible should foreign workers be found living in unsatisfactory conditions?
The interpretation section of the Bill defines a proprietor as “including the owner of the premises who is the lessor or grantor of the licence to occupy.” Specifically, I would like to ask the Minister, how far does ownership extend by this definition? Would it cover financial institutions and funds that are the ultimate owners and who seek to unlock value in such investments? In keeping with the purpose of the Bill as made out in clause 4, would it not be less ambiguous and keeping with the parliamentary intention of the Bill to make the licence holder and the owner or owners, regardless of their shareholding, jointly and severally liable for any infractions committed by the licence holder? A clarification of this point, in view of the Ministry’s potentially ambiguous press release of 4 November 2014 would be appreciated.
Madam Speaker, if this Bill is about providing for certain standards of accommodation and to promote the continuous improvements in the provision of services at dormitories, then I would argue that a firm enforcement regime that emphasises responsibility for foreign workers up and down the value chain be enshrined by this Bill and enunciated by the Minister. This is especially so since big corporates can potentially come on board and purchase strategic stakes in foreign employee dormitories as investors. The benefits of such a prospect should not be solely to unlock shareholder value – I would argue that benefits should flow back to the industry and to society, and align itself with the purpose of the Bill. In some cases, the financial heft of big corporates and holding companies and their ability to undertake independent risk assessments puts them in a good position to be the quasi-regulators of this industry, by virtue of ownership, alongside the Dormitory Association of Singapore.
In conclusion Mdm Speaker, while I support the Bill, which seeks to regulate some aspect of foreign worker accommodation in Singapore, I fear it may be a half-measure and rendered otiose if there is no parallel strategy to better regulate foreign employee accommodation per se – targeting not just big dormitory operators but the small-time contractors and businesses as well. Such as approach would be fairer and serve regulators and business better too, as it would not unwittingly penalise honest businesses which operate large dormitories that this Bill will regulate who play the game by the rules, and who do many Singaporeans a great service by improving the lot of our foreign workers. If Singapore manages to scale up its standards of foreign employee accommodation, our businesses are likely to attract high quality workers and significantly lower the risk of another tragic and senseless fire in Geylang or potentially wanton violations of statutory regulations as evidenced by the secret dormitories in Tampines.