Parliament Sitting on 7 March 06: Question No. 391 for Oral Answer - Steve Chia Kiah Hong: compulsory membership of the Singapore Business Federation

Question No. 391 of Notice Paper No. 82 of 2006 For Oral Answer

Name and Constituency of Member of Parliament
Steve Chia Kiah Hong, Non-Constituency Member of Parliament

Question:
To ask the Minister for Trade and Industry (a) what is the purpose of legislating for compulsory membership of the Singapore Business Federation ("SBF"); (b) how can business owners who find SBF irrelevant to their needs, terminate their membership; and (c) if the Minister will rectify this legislation to make it non-compulsory for small and big businesses which are not interested in joining the SBF

Answer:
The establishment of the Singapore Business Federation with mandatory membership was proposed by the former Singapore Federation of Chambers of Commerce and Industry (SFCCI), as a new apex organization to represent Singapore’s business interests more effectively both locally and abroad.

The Government supported SFCCI’s recommendation and enacted the SBF Act in 2002.SBF membership was made mandatory as the earlier practice of voluntary membership by business chambers and associations had not been effective. The business community had remained fragmented, and lacked a strong and united private sector umbrella organization. Compulsory membership would ensure that SBF has a strong membership base, and has the mandate of the entire business community. Compulsory membership of business chambers can also be found in France, Germany and Brazil, for example.

Only local companies with paid-up capital and foreign companies with authorized capital of $0.5 million and above are required to be members of the SBF. Small companies, partnerships and sole proprietorships are exempted.

In addition, the SBF (Exemption) Order was passed by this House in 2002 to exempt all companies with zero employees. As a result, 6,000 more companies were exempted. If SBF decides that there should be further exemptions based on other clear criteria and recommends them to me, I will consider them.

SBF has been in existence for only 4 years, and we are seeing encouraging signs that more members are finding its services useful. Last year, members’ participation in SBF events almost doubled from 12,000 in 2004 to 22,000.We are told that the recent Budget 2006 briefing, organized as part of SBF’s regular updates on changes affecting businesses, was attended by over 1,000 members. We encourage the SBF to come up with more such activities, services and programs that will deliver greater value to its members.