NTUC Foodfare takes over Old Airport Road hawker centre and ups dishwashing fees by 40%

In a media report on Sat (20 Oct), it was revealed that currently, 13 out of 114 hawker centres across Singapore are managed by five social enterprises: Fei Siong Food Management, NTUC Foodfare, Timbre Group, Hawker Management and OTHM. Hawker Management and OTHM are subsidiaries of Koufu and Kopitiam, respectively.

However, of the 13 centres, NTUC Foodfare actually took over the management of five existing old hawker centres, including the famous Old Airport Road Food Centre from the NEA two years ago.

And, after taking over, several hawkers who did not want to be named, complained that their dishwashing fees have risen 40 per cent to $580 a month by NTUC Foodfare.

Over at the new Pasir Ris Central Hawker Centre also run by NTUC Foodfare, hawkers told media that teething problems continued to plague them some 10 months after its opening in January this year, resulting in more than 10 tenants moving out.

For example, Mr Khaharudin Juraimi, who runs halal burger stall Burgernomics said that some stalls, including his, have leaking exhaust hoods. The problem has yet to be fixed even though they have raised the issue with NTUC Foodfare management several times, he added.

Many hawkers are against social enterprise running hawker centres

Since taking up stalls in hawker centres run by social enterprises, many hawkers complain that they have had to grapple with several issues that they did not face in the traditionally NEA-run hawker centres.

These include having to apply for leave in advance if they choose not to open their stalls, not having the freedom to adjust food prices, and having to pay “penalty” fees for terminating their tenancy.

Douglas Ng who runs Fishball Story, which made it into the Singapore Michelin Bib Gourmand Guide in 2016, told reporters, "Some new hawker centres are being run like food courts. That’s why hawkers are unhappy... the rental costs are rising... hawkers can’t take back their deposits if they want to leave earlier."

Daniel Goh, who runs craft beer stall at Chinatown Complex Food Centre, said that some aspiring F&B entrepreneurs who he had spoken to were keen to run hawker stalls. But when they discovered that they would actually earn more as a line cook at a hotel, paying about $2,000 a month, they became not too keen especially after most of the profits are taken away by social enterprises through high charges and fees imposed on hawkers.

Mr Goh also pointed out that some of the social enterprises were set up by for-profit corporations. “So to expect them to run a ‘social enterprise’ business is conflicting, to say the least. Exactly which aspect of social enterprise hawker centre is social, aside from forcing hawkers to offer a cheap option for diners?” he asked.

Long-time hawker Kelvin Ang at Ang Mo Kio Food Centre said he would not want to work in a social enterprise hawker centre. “There are rumours among hawkers that sooner or later, all of us will be under this type of social enterprise management. We are all worried,” he added.

Mr Ang revealed that in the NEA-run Ang Mo Kio Food Centre, his hawkers’ association would actually engage contractors to wash dishes for them, and hawkers themselves negotiate prices with the contractors directly. "The NEA, they believe in a free market... they won’t control prices. Everyone follows the same set of rules. But every social enterprise runs their centres differently; it causes confusion,” he said.

Amy Khor: Errant social enterprise operators will be taken to task

Three years ago in Parliament, then NMP Kuik Shiao-Yin also showed concerns with regard to how the hawkers would be treated working under the social enterprise hawker centre operators.

He asked how the NEA would ensure that social enterprise hawker centre operators “do not take advantage of their position to profiteer unfairly”. In response, Minister Balakrishnan said that operators are “required to submit audited accounts and detailed management reports”. The NEA “will ensure that the interests of hawkers, cleaners, hawker assistants and patrons are well taken care of”, he said.

But yet 3 years later, problems between hawkers and social enterprise operators have surfaced publicly, with hawkers in the Koufu-run Jurong West Hawker Centre up in arms, petitioning NEA to clamp down on some of the allegedly unfair practices imposed on them by Koufu's subsidiary.

In general, under the not-for-profit model, any operating surplus generated by the social enterprise operator must be shared among its stakeholders, such as the stallholders, the manager and the NEA. It must also be used to create "social benefits", and it cannot go to the manager's shareholders.

However, the operator can, for example, outsource ancillary services to a relative's company, and let his relative's company charge high fees for their services to the hawkers. This was what happened in Jurong West Hawker Centre when Koufu's subsidiary outsourced its dishwashing services to another company owned by the brother of Koufu's boss. The hawkers are charged $1,100 each for the dishwashing service alone.

NMP Walter Theseira told the media that it does not make sense “to think of social enterprises as different from privatised for-profit coffee shops, unless the social enterprise can prove otherwise”.

“Some may be run at arm’s length from their profit-making enterprises, and they may have strong controls to prevent self-enrichment. Others may not,” added Dr Theseira. “The problem is there may be private and marketing benefits from claiming to be a social enterprise, and as such, you really have to look deeper to see what is the actual case.”

In any case, with public pressure mounting, Senior Minister of State for the Environment and Water Resources Amy Khor came out to say that NEA has been tasked to conduct a stock-take of the social enterprise model. She warned on Friday (19 Oct) that errant social enterprise operators will be taken to task.