Introduction

1. The Government recognises the important social role HDB shops play. They not only meet a local need, but also provide a focal point for residents to mingle and enhance the vibrancy of HDB communities.

2. However, HDB shopkeepers face intense competition from shopping malls and megamarts today. The shopping and marketing habits of Singaporeans, especially the young, are also changing. Although HDB has progressively relaxed its policies on change of trade, subletting and assignment to provide HDB shopkeepers with more flexibility to adapt to changing market conditions, some shopkeepers still find it difficult to sustain their business. One reason is the over-supply of HDB shops. Some shopkeepers are also getting old and their children are not keen to take over the business.

Restructuring Programme for Shops (RPS)

3. During last year’s Committee of Supply, the Minister for National Development announced that HDB would launch a new Restructuring Programme for Shops (RPS) to assist HDB shop tenants located in areas where there is an over-supply of shops and where the business is poor, to retire from business. The aim is to reduce the over-supply, so that the remaining shops will become more viable. Where it is possible, the RPS will also help HDB shop tenants to restructure and upgrade their business operations. Let me now give an update on the RPS.

4. In June last year, we selected 7 sites, comprising a total of 193 shops in 21 blocks, for the pilot batch. The shop tenants were polled on whether they wished to quit their business on a block basis. Based on the polling results, 8 blocks comprising 93 shops, or 48% of the shops, had more than 50% of the tenants in the block opting to quit. Hence, all the tenants in the 8 blocks were cleared. Those who opted to quit received an ex gratia payment of $60,000 if they were eligible. Those who opted to continue their business were relocated to replacement shops in other blocks, in addition to a $10,000 removal allowance. The vacated shop space will be converted into void deck space or for social and communal uses.

5. At Sunset Way, one of the 7 sites in the pilot batch, the tenants who opted to remain in business have embarked on a revitalisation plan to inject more life and bring more customers to the area. The tenants have engaged a consultant to help them map out strategies to revitalise the shops and conduct promotional activities. SPRING has provided funding support from its Domestic Sector Productivity Fund (DSPF) for the project.

Review of RPS

6. We started the RPS on a pilot basis to help us ascertain the response from shop tenants and whether the scheme needs to be fine-tuned for subsequent batches. On the whole, we are happy with the outcome of the pilot. Nearly half the shops that were offered the programme will be cleared. It shows that the RPS is a workable programme. Together with other ongoing clearance of HDB shops, e.g. the Selective En-Bloc Redevelopment Scheme (SERS), this will help to reduce the over-supply of HDB shops over time.

Future Plans for the RPS

7. With the conclusion of the pilot batch, we are now ready to extend the RPS to all HDB rental shops. To benefit as many shop tenants in the shortest possible time, we will now invite interested shop tenants to nominate themselves for the RPS to HDB through their Advisers. HDB will consider only those blocks where more than 50% of the tenants have indicated they wish to be considered for the programme. It will also take into account whether there are other shops nearby to serve the residents, so that residents are not inconvenienced if the block is cleared.

8. MND will be writing to all Advisors shortly to provide them with more details. If the response from shop tenants is overwhelming, HDB may have to phase out the implementation at a pace that it can manage.

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