Minister for the Environment and Water Resources Masagos Zulkifli has confirmed in Parliament on Monday (19 Nov) that the Government does not plan on doing away with the social enterprise hawker centre (SEHC) model despite the controversies that surround its implementation.
Mr Masagos told the House today rationalised the decision by saying that most hawkers are doing well under SEHCs "despite implementation challenges," and that the ability to keep food prices "affordable with a good variety of high quality options" is proof that that the SEHC model is "generally sound".
“On the whole, social enterprise hawker centres have achieved good outcomes despite the short time they have started operations,” said Mr Masagos, adding that food prices at SEHCs are generally lower than prices at nearby coffee shops and privately-run food courts.
He added that SEHC operators have been involved in curating hawker stalls "for quality and variety," and that the low prices are a result of the operators cooperating with stallholders to offer a wide selection of dishes on a spectrum of price points.
Mr Masagos said: "NEA does not have a mechanism to curate an attractive collection of food options at each hawker centre, like in the case of the social enterprise hawker centre model.
"Such an allocation system run by the NEA would be complex to execute and be subject to potential audit issues," he added.
Mr Masagos argued that SEHCs have been “establishing themselves within their communities and serving the residents well”, citing that 97 per cent of hawkers at Ci Yuan Hawker Centre renewed their contracts in July, while 96 per cent of hawkers at Bukit Panjang Hawker Centre did the same.
To illustrate his point further, he added that the Kampung Admiralty and Our Tampines Hub hawker centres similarly “hardly" have "any vacant stalls and a long waiting list of potential hawkers”.
"Inappropriate" for the Government to provide subsidies to low-performing hawkers: Masagos
Touching on government subsidies aiming at helping hawkers bear the costs of running their stall such as the centralised dishwashing costs subsidies under the "Productive Hawker Centres" grant by NEA, Mr Masagos argued that it is “inappropriate for the Government to subsidise a hawker on the basis that business is poor”, as it would stifle healthy competition among other hawkers who are doing well.
“The market mechanism is working, and the Government should not intervene unnecessarily, in mandating low or no rental, which could otherwise affect fair competition.
“The model must therefore ensure that rentals and costs are transparent and fair to hawkers, but cannot subsidise hawkers to the extent that it distorts the workings of the market,” said Mr Masagos.