Adjusting system may lead to higher rents: Koh Poh Koon

Opposition MPs' ideas, like fixed rents and rental caps, could leave hawkers worse off

- Goh Yan Han

Ideas from opposition MPs to adjust the hawker stall rent system may in fact lead to higher rentals, warned Senior Minister of State for Sustainability and the Environment Koh Poh Koon.

"We must make sure that the cure that we are all proposing is not going to be worse off than the issue we're trying to resolve, to the detriment of hawkers and consumers," he added.

He was speaking during a debate in Parliament on Nov 13 on a motion proposed by Progress Singapore Party Non-Constituency MPs Leong Mun Wai and Hazel Poa.

They had proposed several methods to reduce rent, like moving away from the current tender system for stall allocation, and a different way to determine rents.

Dr Koh highlighted that rental costs are not the main component of overall costs borne by hawkers.

According to a National Environment Agency survey, the cost of food ingredients accounted for nearly 60 per cent of operating costs on average in 2023, he said.

Manpower costs take up about 20 per cent, while rental costs make up less than 10 per cent of operating costs, he added.

Dr Koh noted that stall rentals at hawker centres are generally lower than at nearby eating establishments such as coffee shops, food courts and small eateries.

For a majority of cooked food stallholders in hawker centres, median rent is about $1,250 a month, and has remained relatively stable for the past decade.

Stressing that the Government, which builds the hawker centres, does not use rent for cost recovery, Dr Koh said rental amounts are determined by what the tenderers bid. This can be as low as $1.

There is no reserve rent or minimum bid price, which means bidders can obtain stalls at low rental rates.

More than 300 stalls were obtained at bids below $100 over the last three years, while a few in 2023 and 2024 even won bids at $1, he added.