Staggered stall rentals to support stallholders in new hawker centres as experience shows that new hawker centres take time to establish themselves
Singapore, 26 August 2019 – By 2027, the National Environment Agency (NEA) will complete the building of 20 new hawker centres, located in different parts of Singapore to serve the needs of residents. To date, seven of these new hawker centres have been completed and have started operations. Experience from the last four years shows that new hawker centres largely take time to establish themselves. As more hawker centres are built in the coming years, a new Staggered Rent Scheme will be introduced to support stallholders’ businesses in the initial years of the new hawker centres’ operations.
Implementation of Staggered Rent Scheme at new hawker centres
2 After a hiatus of almost 30 years, the new hawker centre building programme started from 2011 to ensure that residents have continued access to affordable food in a hygienic environment. To date, seven new hawker centres have been built and are managed by socially-conscious enterprises, of which two have gone on to their second term of operation. In our regular review of hawker centres, a key learning point is that new hawker centres take time to establish themselves. Time is generally needed to raise potential patrons’ awareness of these new centres and for the stallholders at the centres to build up a regular clientle and stabilise their businesses.
3 13 more new hawker centres will be completed by 2027. With the Staggered Rent Scheme, stallholders of these new hawker centres will benefit from lower rentals in the first two years of the centres’ operations, at 80% and 90% of stall rentals respectively. The upcoming hawker centre at Bukit Canberra, targeted to be operational in the second half of 2020, will be the first new hawker centre to benefit from the implementation of the Staggered Rent Scheme.
4 We will extend the rental remission of 10% for a period of six months from 1 September 2019 to 29 February 2020 to all eligible stallholders in the existing new hawker centres that would still be in their second year of operations as at 1 September 2019. The three new hawker centres that will benefit from this are located at Yishun Park, Jurong West and Pasir Ris Central. Eligible new stallholders who begin their stall tenancy between 1 September 2019 to 29 February 2020 at these centres, will also similarly enjoy a 10% stall rental remission, until 29 February 2020.
Fine-tuning the tender evaluation for upcoming hawker centres
5 To ensure the continued availability of affordable food while supporting stallholders to manage costs at our hawker centres, NEA is also fine-tuning the criteria for evaluation of tender proposals from socially-conscious enterprises interested to operate the upcoming hawker centres. Currently, to safeguard the interest of stallholders, operators who propose lower stall rentals and operating costs are already considered more favourably, and they are also not to vary these charges over the tenancy term. In future tenders for new hawker centres, even greater consideration will be given to the proposed total costs to stallholders. At the same time, on the business side, proposed initiatives that drive footfall to the hawker centre will also be considered in the tender evaluation, as footfall will ultimately drive patronage and the business success for the hawkers.
Other efforts to support new hawker centres and stall-holders
6 The Staggered Rent Scheme will be in addition to the subsidy for centralised dishwashing (CDW) service which has been in effect at our new hawker centres since 1 January 2019. Under this scheme, NEA co-funds the cost of CDW service with stallholders, at 50% for the first year and 30% for the second year of adoption, to help them to better manage their initial operating costs. Upcoming new centres will also enjoy the CDW co-funding support by NEA. The CDW service helps to alleviate the work load and manpower constraints faced by hawkers, while keeping the stall area clean and dry.
7 In November 2018, NEA also reviewed the key contractual terms between the five operators of seven new hawker centres, and the hawkers at these centres. The operators had made changes to contractual terms which came into effect on 1 January 2019. The key changes to the contractual clauses relate to stall operating days and hours, termination notice periods and security deposits, capping of liquidated damages that can be charged to stallholders for breaches, and waiving of legal fees related to the tenancy. From the feedback received so far, these changes have been welcomed by the stallholders at the seven new hawker centres. The five operators also formalised a system to conduct regular hawker feedback groups, which are still ongoing.
Sentiments towards new hawker centres managed by socially-conscious enterprises
8 In addition to the feedback from stallholders, NEA also conducts regular surveys on public sentiments towards our hawker centres, both existing and new. The Perception Survey of Hawker Centre Patrons, conducted in 2018 and covering 1,103 Singapore Residents aged between 18 to 69, was recently released in June 2019. The most recent poll by REACH conducted in April 2019 focused on public sentiments towards the seven new centres managed by socially-conscious enterprises. A key finding from the poll shows that close to three in four respondents, who said they were aware of the discussion on the management model of the new hawker centres, were supportive for hawker centres to be managed by either socially-conscious enterprises or NEA, as opposed to having all hawker centres managed by NEA. The telephone poll was conducted with a sample of 1,157 randomly selected Singapore Residents aged 15 and above.
9 Other top line findings from the poll on public sentiments towards the seven new hawker centres managed by socially-conscious enterprises are as follows:
a. Patronage - Three in seven respondents have eaten at the seven new hawker centres, out of the total of 114 hawker centres in Singapore.
Among those who were patrons of these seven hawker centres,
b. Affordable food options - Only one in 10 respondents disagreed or strongly disagreed that the new hawker centres provide affordable food options.
c. Offer three meals a day - More than four in five respondents agreed or strongly agreed that there should always be some stalls opened for breakfast, lunch and dinner at a hawker centre (this is the case for all new hawker centres).
d. Cleanliness - About three in five respondents agreed or strongly agreed that the new hawker centres are cleaner than other hawker centres, while only one in 10 disagreed or strongly disagreed.
e. Attractive to aspiring hawkers - About one in two agreed or strongly agreed that the new hawker centres will attract new hawkers to join the trade, while only less than one in five disagreed or strongly disagreed.
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Annex A
New Hawker Centres In Numbers
Annex B
Sentiment Poll on New Hawker Centres Managed by Socially-Conscious Enterprises 2019