Singapore - Statutory Boards

Statutory boards

The eighty-three statutory boards were a distinctive feature of Singapore's government. In law, a statutory board was an autonomous government agency established by an act of Parliament that specified the purpose, rights, and powers of the body. It was separate from the formal government structure, not staffed by civil servants, and it did not enjoy the legal privileges and immunities of government departments. It had much greater autonomy and flexibility in its operations than regular government departments. Its activities were overseen by a cabinet minister who represented Parliament to the board and the board to Parliament. Statutory boards were managed by a board of directors, whose members typically included senior civil servants, businessmen, professionals, and trade union officials. The chairman of the board of directors, who was often a member of Parliament, a senior civil servant, or a person distinguished in some relevant field, was appointed by the cabinet minister who had jurisdiction over the board. The employees of the board were not civil servants, as they were not appointed by the Public Service Commission. The salary scales and terms of service of employees differed from board to board. Statutory boards did not receive regular allocations of funds from the public treasury, but were usually expected to generate their own funds from their activities. Surplus funds were invested or used as development capital, and boards could borrow funds from the government or such bodies as the World Bank. Statutory boards included the Housing and Development Board, the Central Provident Fund, the Port of Singapore Authority, the Industrial Training Board, the Family Planning and Population Board, and the Singapore Muslim Religious Council (Majlis Ugama Islam Singapura).

The statutory boards played the major role in the government's postindependence development strategy, and their activities usually served multiple economic and political goals. The Housing and Development Board (HDB) provided a good example. The HDB was established by the first People's Action Party (PAP) government on February 1, 1960, to provide low-cost public housing. The Lands Acquisition Act of 1966 granted the board the power of compulsory purchase of any private land required for housing development. The prices paid by the board were about 20 percent of the estimated market value of the land, which was in fact if not in form being nationalized. Between 1960 and 1979, the percentage of land owned by the government rose from 44 to 67 percent, increasing the government's control over that scarce resource and benefiting lowincome voters, who supported the PAP, at the expense of the much smaller number of private landowners. Rents for Housing and Development Board apartments were subsidized, and selling prices for the apartments were set below construction costs and did not include land acquisition costs. Purchase prices for board apartments in the 1980s were 50 to 70 percent below those of privately owned apartments. By 1988 Housing and Development Board apartment complexes were home to 86 percent of the population, and construction of new apartments continued.

The HDB succeeded in its primary goal of building large numbers of high-quality apartments. Its success depended on several factors, among them: access to large amounts of government capital; sweeping powers of land acquisition; the ability to train its own construction workers and engineers; the freedom to act as a building corporation and develop its own quarries and brick factory; the opportunity to enter into partnerships and contracts with suppliers of construction materials; and the ability to prevent corruption in contracting and allocation of apartments to the public. The government raised the capital for housing construction from the Central Provident Fund, a compulsory savings plan into which all Singapore workers contributed up to 25 percent of their monthly incomes, and from low-interest, long-term loans from such international development agencies as the World Bank.

By providing adequate housing at low cost to low-paid workers in the 1960s, the PAP delivered a highly visible and concrete political reward to the electorate and laid the foundations for its unbroken electoral success. In the 1960s and early 1970s, before the growth of export-oriented industry, housing construction provided much employment and an opportunity for workers to learn new skills. By controlling the pace and scale of housing construction, the government was able to better regulate the economy and smooth out cycles of economic activity. The result of rehousing practically the entire population was to make the government either the landlord or the mortgage holder for most families and so bring them into closer contact with the state. The government used resettlement to break up the ethnic enclaves and communities that had characterized colonial Singapore. It put its policy of multiracialism into practice by seeing that all apartment buildings contained members of all ethnic groups in numbers that reflected their proportion of the national population. The program kept the cost of housing in Singapore relatively low and helped to avert pressure to raise wages. Because access to subsidized housing was a benefit extended only to citizens, it served to promote identification with the new state. Providing most of the population with low-cost housing gave the government and ruling party much favorable publicity, won public support, and was used as evidence for the correctness of the government's policies of centralized planning and social engineering implemented by experts on behalf of a passive public.

In a similar fashion, the Central Provident Fund benefited the citizens by providing them with secure savings for their old age and the satisfaction of having their own account, which could be used as security for the purchase of a Housing and Development Board apartment, for such expenses as medical bills, for college tuition, or to finance a pilgrimage to Mecca. The government benefited by gaining control of a very large pool of capital that it could invest or spend as it would and by removing enough purchasing power to limit inflationary tendencies. Furthermore, the proportion of the wage contributed to the fund by both workers and their employers could be adjusted at any time, enhancing the government's ability to control the economy. In 1988 the Fund took 35 percent of all wages up to S$6,000 per month; 25 percent was paid by the worker and 10 percent by the employer. Among its other functions, the Central Provident Fund was one of the major instruments used by the government to control wages.

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