Car Park Maintenance Contracts Issued by HDB and Town Councils

Mr Murali Pillai asked the Minister for National Development (a) why does HDB issue Town Council contracts for maintenance of HDB car parks although such maintenance falls outside the Town Councils Act 1988; (b) how are the fees in the contracts determined; and (c) having regard to the different contract cycles and price points of the maintenance contracts issued by HDB and Town Councils respectively, how is the risk of Town Councils cross-subsidising HDB for the maintenance of HDB car parks addressed.

HDB car parks are not common property and, therefore, do not come under the management and maintenance of Town Councils (TCs). However, the Town Councils Act allows TCs to manage and maintain HDB car parks on terms and conditions mutually agreed between HDB and TCs. In this regard, HDB offers TCs the option to serve as the maintenance agent for HDB car parks, as there may be operational synergies in TCs doing so. For instance, TCs can, potentially, obtain lower prices from calling bulk tenders for maintenance services. TCs can also better coordinate the scheduling of maintenance works to minimise disruption to residents.

HDB ensures that the fees are fairly set in a number of ways. In determining the maintenance fees, HDB considers both TCs’ submissions of their operating costs for maintenance of car park equipment, such as pumps and fire protection systems, as well as the equivalent private sector rates to ensure that TCs are compensated fairly relative to market prices. It then adds an agency fee to TCs. The maintenance agreement period is, typically, three years. So, this allows for regular review of the fees. In addition, TCs can assess and decide if they wish to serve as HDB’s maintenance agent. Should TCs decline the offer to maintain HDB’s car parks, HDB will procure alternative maintenance services via tender.