New model for running hawker centres

In seeking to outsource the running of hawker centres to not-for-profit social enterprises ("Not-for-profit model sought for 4 food centres"; Jan 4), the Government is looking for partnerships to provide a livelihood for hawkers while offering affordable food to the community and jobs for Singaporeans.

Social enterprises are businesses that champion causes using revenue obtained from the businesses they run. They are imbued with the rigour of free market enterprise but with people-sector benefits.

Social enterprises can be for-profit or not-for-profit. Not-for-profit ones do not pay dividends to shareholders, while for-profit ones can reward investors handsomely if the business takes off.

What differentiates them from regular businesses is their focus on social impact, for example, offering job opportunities to marginalised people - that is, doing what regular businesses do only on the side and usually out of corporate social responsibility.

The not-for-profit model for hawker centres deters investors from profiteering from surpluses that can come from increases in stall rentals or cost of services provided to hawkers.

In this new model, the National Environment Agency remains as the regulator and licenser of hawkers. It will benefit from private companies that have made bulk purchases, resulting in cost savings and higher productivity.

It will also ensure that the ultimate goals of providing affordable food and jobs for Singaporeans are met.

In this new model, the Government is outsourcing the operation of hawker centres but not the mandate that people entrust to it.

Reader, Teo Mee Hong (Ms)