Oral Reply to Parliamentary Questions on Socially-conscious Enterprise Hawker Centres

Questions:

To ask the Minister for Sustainability and the Environment (a) whether the NEA permits social enterprise hawker centre (SEHC) operators to include contractual requirements for hawkers to provide a set number of free meals; and (b) whether NEA will provide guidance on the appropriateness of such practices in future contracts.

To ask the Minister for Sustainability and the Environment whether the National Environment Agency will review the practice of operators of socially-conscious enterprise hawker centres requiring hawkers to absorb the 10 percent discount offered to customers paying via the operator apps.

To ask the Minister for Sustainability and the Environment (a) what are the principles that currently guide who should bear the cost of providing affordable, nutritious meals to low-income patrons; and (b) whether the Ministry will review the current distribution of responsibility to prevent it from disproportionately falling on hawkers.

To ask the Minister for Sustainability and the Environment whether the Ministry will consider mandating the public disclosure of full tenancy agreements for hawker centres operated by Socially-conscious Enterprise Hawker Centre operators.

To ask the Minister for Sustainability and the Environment (a) whether Socially-Conscious Enterprise Hawker Centre (SEHC) operators require the approval of NEA to change contractual terms with stallholders; (b) how regularly does NEA review contracts between SEHC operators and stallholders; (c) whether NEA can and has exercised its veto against such contractual terms; and (d) whether NEA intends to conduct a comprehensive review of the SEHC model.

To ask the Minister for Sustainability and the Environment (a) what principles currently guide who should bear the cost of providing affordable and nutritious meals to low-income patrons; and (b) whether the Ministry will review the current distribution of responsibility for providing such meals to low-income patrons between Socially-Conscious Enterprise Hawker Centre (SEHC) operators, their stallholders, NEA, and consumers.

To ask the Minister for Sustainability and the Environment (a) whether clauses mandating hawkers’ participation in charitable and discount programmes organised by Socially-conscious Enterprise Hawker Centre (SEHC) operators at the hawkers’ own expense are prohibited under NEA’s guidelines for tenancy agreements between stallholders and operators; (b) whether NEA’s guidelines are publicly available; and (c) if not, whether this can be publicly released for better public education.

To ask the Minister for Sustainability and the Environment (a) whether the Ministry conducts a review of the Socially-conscious Enterprise Hawker Centre (SEHC) model on a regular basis; (b) if so, what is the frequency of the review and when was it last reviewed; and (c) what are the findings from its latest review.

Answer:

1 Mr Speaker, I thank Members for raising various questions about SEHCs. I will explain the SEHC management model and address the various concerns, including the Government’s role in overseeing SEHC operators and their relationship with stallholders.

2 When the Government resumed building hawker centres in 2011, we introduced the Socially-conscious Enterprise Hawker Centre (SEHCs). This is to harness the expertise of experienced F&B industry players to bring fresh perspectives and best practices to hawker centre management, including the curation of active placemaking, and meeting residents' needs for accessibility of affordable food options across all three meals.

3 The National Environment Agency (NEA) maintains oversight over operators who are appointed to maintain and manage SEHCs. Operators must comply with the requirements set by NEA. These requirements strike a balance between ensuring that patrons’ needs are adequately served and safeguarding stallholders’ well-being. NEA also seeks to provide SEHC operators with sufficient flexibility to allow them to operate SEHCs effectively.

4 To safeguard the interests of stallholders, NEA has, since 2018, put in place basic guidelines for tenancy agreement terms. For instance, stalls should not be required to be open for more than 5 days per week and no more than 8 hours a day, and limits are set on amounts that operators can charge stallholders for contractual breaches. The key features of NEA’s guidelines had been made public during the parliamentary debates in 2018 and 2024. Before stallholders sign these tenancy agreements with an operator, NEA would review the agreements and engage operators to adjust their clauses if necessary.

5 Since 2019, NEA has capped stall rentals to average independently-valued rents, as well as discounted rent in the first two years of a centre’s operation as we recognise that an SEHC’s footfall and operations would require time to build up and stabilise.

6 Beyond these guidelines, operators have the flexibility to state the other terms of their agreements with stallholders, based on operational needs. However, these terms must be made upfront by operators so that hawkers can make an informed decision based on their business preferences and cost considerations. Operators must also explain these terms clearly to stallholders. NEA officers would usually be present at these tenancy agreement signing sessions. After tenancy agreements are signed, operators must not impose any charges that were not specified in the agreements.

7 As tenancy agreements are private arrangements between the operators and stallholders, it would not be appropriate for NEA to mandate public disclosures.

8 Some Members have asked about affordable meal options. In line with the primary mission of hawker centres to provide affordable food options, NEA requires SEHC operators, as part of tender requirements, to implement ways to make food affordable. So far, SEHC operators have done so by making at least one value meal available at each stall. Value meals are part of the range of food options offered at the SEHCs at a variety of price points.

9 SEHC operators explain the value meal requirement upfront to stallholders when signing the tenancy agreements. Each stallholder has the flexibility to propose his or her meal item, while retaining the prerogative to offer other food options at higher prices. This takes into account their costs and pricing strategy. Operators will also review their value meal prices from time to time and have previously adjusted prices upwards based on feedback from stallholders. Importantly, stallholders are not expected to make a loss from selling such value meals as they should have taken this into consideration when negotiating the rent with the operators.

10 Some Members also asked about charitable meal schemes. So far, only Bukit Canberra Hawker Centre has such a scheme. The operator’s Pay-It-Forward initiative was a well-intentioned initiative to give lower income members of our community some additional support as part of our shared interest to make the hawker centre an inclusive community dining option. The scheme was made known to stallholders upfront before they decided whether to rent stalls at this particular SEHC. NEA was also aware of the scheme. Therefore, stallholders who decided to proceed with renting stalls at the centre, rather than choose other centres without such a scheme, would have factored the costs into their business consideration. Notwithstanding this, I understand that the operator has not implemented the scheme to-date, following feedback from stallholders and the public. The operator has decided to remove the requirement from new agreements and tenancy renewals.

11 Some operators have developed phone apps which offer discounts to loyal customers. This is among various initiatives introduced by operators to attract patrons, increase footfall and encourage repeat customers at their SEHCs, which would benefit stallholders. SEHC operators bear the costs of developing such apps and conduct marketing and publicity efforts while stallholders bear a portion of the costs by providing discounts in return for increased sales. This is an example of the partnership and shared efforts of operators and stallholders to make their SEHCs vibrant and successful.

12 SEHC operators are required to conduct quarterly feedback sessions with their stallholders, which are also attended by NEA representatives. This serves as a regular platform for stallholders to provide feedback or ideas on improving the operations of SEHCs, or raise any areas of concern. For example, one operator took in feedback about high gas costs and will explore lower cost options after the current gas contract expires. Another operator stepped up checks on the segregation of trays and crockery following feedback from stallholders. This consultative approach between operators and stallholders fosters trust and understanding, and allows differences to be addressed and SEHC operations to be improved.

13 Mr Speaker, our SEHCs have been vibrant and have brought many benefits to our community. Satisfaction levels for various aspects of SEHC management have been higher than 80% based on NEA’s surveys between 2021 and 2024. Stall occupancy rates are at about 96%. Nevertheless, we always welcome and have heard your feedback. NEA has always sought to strike a balance between safeguarding the interests of both hawkers and patrons, whilst giving SEHC operators sufficient room to set requirements aligned with their business strategies to help their SEHCs thrive and succeed. Moving forward, we will continue to improve the SEHC management model through constructive engagement with stakeholders and continuous refinements to better serve the interests of our community.