Will Service and Conservancy Charges go up by 18 percent?

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By: Leong Sze Hian

I refer to the article “Additional S$100m a year to help town councils maintain, replace lifts: MND” (Channel NewsAsia,  Feb 2).

It states that “Taken together, the additional funding will double MND’s existing funding support to town councils – under the annual Service and Conservancy Charge operating grants and quarterly Goods and Services Tax subvention – which amounted to around S$120 million in FY15/16, according to the ministry.”

50% matching grant?

As to “The funding will consist of a lift maintenance grant of S$600 per lift owned and maintained by the town councils, which is expected to cost the Government an additional S$13 million a year, as well as match 50 per cent of their quarterly contributions to the Lift Replacement Fund that will become mandatory for town councils from Apr1 this year.

14% S & C C increase is about $100m? 

The lift replacement fund, meanwhile, is expected to cost the Government more than S$50 million in the coming year” – does it mean that the minimum of 14 per cent of the S & C C that town councils will now be required to set aside in the sinking fund for lifts is about $100 million ($50 million x 2)?

If so, then we can try to estimate the total that all the town councils collect in a year – $714 million ($100 million divided by 0.14).

About $9 increase?

So, with about 900,000 HDB households – does it mean that the expected average increase in S & C C per household due to this new lift fund is about $111 a year ($100 million divided by 900,000) or $9 a month?

As I understand that the average monthly S & C C is about $50 – does it mean that it may translate into an average increase of a whopping about 18 per cent ($9 divided by $50)?

Debate in Parliament?

Instead of just announcing the numbers like “minimum of 14 per cent” and “more than $100 million more grants” – shouldn’t there be a debate in Parliament as to what it actually means for Singaporean HDB households, like I have tried my best to estimate above?

No F1 = No S & C C increase?

By the way, since there has been speculation in the media that F1 may not continue – why not use the as I understand it – $150 million a year to fund lifts, so that S & C C may not need to be increased?