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Social enterprise operator says $600 monthly inspection fee optional but hawkers dispute this

On Tue (28 Aug), Makansutra food guru KF Seetoh published a write-up on his blog revealing the sorry state of affairs the whole Social Enterprise Hawker Centre (SEHC) initiative has become. Many are run like commercial food courts, he observed. His blog quickly went viral.

Contract agreements from hawkers at SEHCs revealed that on average, they are paying about $4000 a month on stall rentals. Mr Seetoh fumed, "These hawkers in the new hawker centres pay in total (with a laundry list of extra services and charges), an average of $4000, more than what it cost the highest bidder in Maxwell Hawker Centre - arguably the most popular hawker centre in Singapore - where it hovers between two to three thousand dollars a month in total."

One hawker told Mr Seetoh, "Social enterprise hawker centres are not sustainable. Just you wait, a lot of such hawkers are calling it quits soon."

Then there are a number of hidden charges written inside the contract agreements, like imposing a Gross Turnover Profit percentage, charges for crockery washing, collection and return and even a "brazen clause" that hawkers need to pay a "consultant" $600 a month to have them spot check their food quality and operation.

The best part is that if the hawker fails to pay the $600 "consulting fee" in time, he will be charged 12% interest or "such higher rate as may be determined from time to time by the Consultant" for any outstanding amount owed - aka "Ah Long" style of "O$P$" but minus the pig’s head and red paint.

Seetoh's blog prompts mainstream media to investigate

With Mr Seetoh's blog going viral online, CNA decided to investigate the matter further. It published a report today (2 Sep) confirming the existence of some of the controversial costs flagged by Mr Seetoh.

One of the social enterprises, Fei Siong Food Management, confirmed the existence of the $600 monthly inspection service. But Fei Siong said it was "optional". It added that the $600 service is for hawkers that "require help in professional services such as food quality and hygiene audits".

The service is not compulsory for hawkers, nor is the coin exchange, which the company said is a non-profit service it offers. Hawkers interviewed, however, disputed what Fei Siong had told CNA and insisted that the $600 inspection fee was not optional.

"We were told about the fee in July when our contract was up. It came out of nowhere, and they told us that it is for the NEA (National Environment Agency) and quality control," said one hawker. The hawker, who did not want to be named, said he was forced to agree to the inspection fee as he wanted to continue running the stall.

About a month after he signed the stall agreement, someone did come to inspect his stall. "It was over in just a minute. They came in, took a brief look at our stall and left. I don't know if that person is from NEA," he said.

Another hawker who was disgusted by the $600 monthly inspection fee decided to stop running his stall altogether. "I was asked to continue by signing both agreements or my (hawker) licence will not be renewed. I was told I cannot opt out (of inspection service). If it is optional, why did none of the stalls opt out to reduce costs," he told CNA.

But what was most incriminating is that the CNA reporter saw a WhatsApp message showing that Fei Siong did tell hawkers that the $600 inspection fee was to be compulsory.

Social enterprise operators "burying" us

A hawker, who goes by Mr Yeo, explained, "At the end of the day, an NEA hawker centre is still cheaper for hawkers (than social enterprise hawker centre). The rental may be comparable to NEA hawkers, but the add-ons make it more expensive."

And another hawker condemned the social enterprise operators, "It's like digging a hole and asking us to jump in. Then they bury us."

"To promote 'hawkerpreneurship', you need to set the processes and procedures right. It has to be same as the operation of NEA-managed hawker centres. NEA should have regulated the social enterprise hawker centres like it does with the regular hawker centres," he added.

Motherhood statements from NEA

When CNA contacted NEA for comments, NEA said it has "put in place measures to ensure that the (social enterprise) managing agents keep food prices and stall rental (and other operating costs) affordable".

"Ultimately, the hawker centres being run by socially-conscious operators should be for better management, better service and stable prices which in turn benefit consumers," NEA said.

"The Government is committed to upholding the role of hawker centres as community dining rooms, and will continue to adapt and enhance this key social infrastructure so that it remains relevant and attractive to our diverse population."