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Posts Tagged ‘Budget 2013’

The G spot – on town councils

In News Reports, Politics on March 3, 2015 at 1:37 am

So we were treated to a spectacle in Parliament recently with the Workers’ Party having to defend its management of the Aljunied-Hougang-Punggol East town council in the wake of the Auditor-General’s findings. The WP is being cajoled into pursuing its own investigation into the supposed shenanigans of its managing agent. The G has warned darkly about criminal charges.

A repeat performance can be expected when the MND’s budget comes up for debate with more details on a review of the Town Council Act. Perhaps, all will be unveiled to tighten the practices of town councils to subject them to more regulatory oversight. Among the expected rules : town councils won’t be able to decline submitting reports to MND, such as on its service and conservancy charges arrears. But whether WP committed a big or small foul, criminal or civil, some people want to know if the infrastructure in place for a changeover of town council operations is robust enough.

What a poster said: Can we confirm that citizen’s monies are not wasted in having to come up with a completely different accounting system that has to be set up from scratch when GRCs change hands, and the old system abandoned? Can we assure that no such wastage occurs in future, including man hours spent in parliament debating such wu-liao things that should not have happened in the first place if system was not changed?

There’s some sympathy for the WP which singled out the difficulty in getting a new software/computer system set up to reconcile S&C accounts after it pulled Aljunied and Punggol East under its fold. The withdrawal of the PAP’s AIM company left a gap. Software glitches, manual counting led to mistakes in its arrears reports, so WP said.

Netizens have a point about the transfer process. What sort of time frame is adequate for handover processes that involve thousands of dollars? What if the current managing agent pulls out or terminates its contracts? Was the Town Council Act conceived without safeguards for a handover in the expectation that town councils will not change hands? What is the role of the G (as opposed to a PAP-controlled G) in ensuring that voters’ choice is respected and their interests – despite their political inclinations – safeguarded?

Another poster said: Should all Town Councils be de-politicised and centrally administered so that there will be minimal or no handover/ mis-management issues? The welfare of residents must always come before politics.

Some have called for a return to the HDB days when it managed estates. But it seems too late to roll back time. Imagine the politicians having the ground cut out from under their feet literally. Town council management was supposed to display their ability to run the small stuff. If you can’t manage an estate, can you manage the country? Such management was supposed to keep them close to the ground, instead of merely seeing their duty as talking shop in Parliament. But is there a level playing field or are there obstacles, wittingly or unwittingly, put in the way when a new group takes over?

It is my fervent wish that should there be a review of the Act, it would be submitted to a parliamentary select committee to gather more views.

The roles and responsibilities of MPs in town councils brings forth another point on their relationship with the grassroots groups.

The same poster asked: On a related matter – there are many posters, placards etc in my estate from the Town Council / Residents Committee featuring the picture of our elected representatives – who pays for these materials? And if it is the “town council” is it an appropriate use of S&C funds. If it is the PA, is it an appropriate use of non-partisan funding?

It is an old issue raised even in pre-Town Council days. The alphabet soup of grassroots groups run by the People’s Action Party in constituencies are G institutions. The G is the PAP. Hence, the PAP is in charge of grassroots groups. That’s how the logic goes for the opposition politicians and their fans.

Personally, I don’t think the groups painstakingly built up by the G should be handed over simply. The deal was the town council changes, not the constituency groups. My problem is whether the authority of the grassroots groups are on a par or even over-rides that of the elected MPs. It is something the WP tried to raise in court in the saga over whether its trade fair was held legally. It had, among other things, chafed about having to gain the support of the Citizens’ Consultative Committee, the key grassroot group in the constituency.

So here is my own question:  Please explain the role, responsibilities and powers of the appointed members of the Citizens’ Consultative Committees and how they compare to those of the elected members of the constituency they serve in.

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Cut off a few heads

In Money, News Reports, Politics, Society on March 9, 2013 at 11:10 pm

There was an interesting feature in The Sunday Times today about COE prices by ex-ST editor Han Fook Kwang. In essence, he recounted how various changes to Singapore’s car ownership story has caused the explosion in COE prices. The earth should have moved within the G ranks, he said, when COE prices shot up. It didn’t.

Here is his list of how this happened:

In 2003: car loan restrictions which had been in force from 1995 lifted.
In 2002: ARF reduced from 140 per cent of the open market value of a car to 130 per cent, part of a planned reduction in the tax which was brought further down to 100 per cent in 2008.
In 2009: COE numbers reduced to slow down the growth rate of the car population from 3 per cent a year to 1.5 per cent, and to 0.5 per cent this year.

“Should anyone be surprised then that COE prices exploded, hitting the $90,000 mark?
“In its defence, each of these changes could be justified on its own grounds, as indeed they were. But taken together, it was a recipe to break COE price records. It shows how important it is for policymakers to be clear about what they want to achieve and to be wary of unintended consequences.’’

What he wrote sounded a bit like what National Development Minister Khaw Boon Wan said about housing policy during the budget debate. So many tweaks over the years that we’ve lost sight of what is the G’s role in providing public housing – hence high HDB prices.

In 1971: HDB flats can be resold for a profit.
In 1989: HDB flat owners can keep their flat, even when they buy a private property.
In 1993: Buyers can take loans based on the prevailing market value of the flat,instead of HDB’s historical selling prices.
In 2003: HDB flat owners can sublet their flats.

In between, the housing policy is used as a social tool for everything from making sure families stay together, encouraging the formation of families, raising the value of housing assets by subsidising upgrading, catering to the accommodation of foreigners and PRs, ensuring the spread of races…You name it, the housing tool can be used to fix everything so much so that the myriad renovations might well damage the supporting beam structure.

So Mr Khaw as well as other MPs are asking for a back to basics look at housing policy.

The trouble is, the genie is out of the bottle. Going back to basics and first principles mean that some groups which had benefited from the changes which made housing policy so complicated will be affected.

Mr Khaw raised the example of the income ceiling for HDB flats.
Should it be lowered, raised or lifted. Should executive condos continue to be offered? (Now we have to remember that ECs were in response to the housing needs of a sandwiched class who were priced out of both public and private property.)

Another example he gave was whether the HDB should return to pre-2003 days of strict owner-occupation. Then what would happen to the many retirees who rely on income from subletting or the younger homeowners who use it to help support their lifestyle?

A third example: Return to pre-1989 days when HDB flat owners have to sell off their flats when they buy a private residential property. What to say then to Singaporeans who aspire to live in a private condo and use their HDB flat for additional rental income?
Mr Khaw has been fighting fires (his words). He’s delinked BTO flat prices from the resale market to make them more affordable although he very cleverly said that those who want to figure out the discount should do the sums themselves (which property analyst will do this please?)

So housing will now be part of an in-depth conversation within the National Conversation. Mr Khaw’s back to basics re-look should apply to other policies as well. For example, have we lost sight of the G’s role in public transport (why should it subsidise transport operators?) and education (with calls now to nationalise pre-school education)?

In fact, one important facet of this discussion is what we, the citizens, want from the G in these areas. Our record is not good – we want the G to do everything. Every segment of the population wants something different that is in its interest, and policies are tweaked to cater to demand. The result is a many-headed monster of a policy. It is a Hydra that will eat the next generation, not mine or my parents’ – since we probably would have got most of what we wanted over the years.

Maybe, we should just do this: Come to an agreement on the G’s role in each area and state its mission and vision in the provision of housing, transport, education and healthcare, plus the underlying principles that will underpin its operations to fulfil its vision. Then we should look at the monster with a view of cutting off some of its heads and making sure they don’t grow back. It’s easier said than done of course.

But it would be an interesting political and intellectual exercise.

Mr Sitoh, say it like this lah

In News Reports, Politics on March 7, 2013 at 4:36 am

The Straits Times today honoured PAP Sitoh Yih Pin by excerpting his speech in Parliament for its Speech of the Day column. Mr Sitoh spoke about trust between the government and the government. Interesting. A few days ago, ST carried a report on the level of trust between the parties. While Singaporeans trust the G as an institution, they don’t trust the leaders when it comes to breaking bad news. Mr Sitoh didn’t mention the survey carried out by public relations firm Edelman, by the way. My guess is that he probably read the findings.

Anyway, he said the G should be courageous enough to tell the truth, even if it is unpleasant. No one can quarrel with that. Straight talk is always appreciated. Methinks it can be more hard hitting. So I will list his six hard truths – and with tongue half in cheek, rewrite them – and respond to them.

1. We will increase the number of places in universities and polytechnics and 60 per cent of Singaporeans will become PMETs, but some graduates will never stay in private housing or own a car. This is because 85 per cent of housing are HDB flats and only one-third of families have a car presently and these numbers will not change drastically.

Re-written: Hey, I know most of you young people are going to be university graduates, but face it, just because you have a degree, doesn’t mean you get to stay in a bungalow and drive a Ferrari. I mean, for every one of you, there are five others with your qualifications. How to give all a bungalow and a Ferrari? Remember that 85 per cent of people live in HDB flats and one in three families have a car now.

Response: Orh ok. Then I study for what? At least, can make the HDB flat bigger or nicer? And make sure the HDB price is not the price of a bungalow or private property? I don’t need a Ferrari. I don’t mind taking public transport. I hope by the time I start work, the trains and the buses are running properly. I mean, have you seen how jam-packed it is at peak hour? I can’t even get to school on time some days.

2. This country needs to continue to be run as a meritocracy. There is no other feasible alternative. The best will get more. One may rightly question the norms of meritocracy, as in what makes a person more meritorious? One may even ask why there are so many brand-name schools in the more affluent areas in Singapore and not in the new HDB estates. And in the harsh reality of meritocracy, we also expect the meritorious to do what is necessary for meritocracy to remain relevant – they must contribute more than others to the betterment of the society and maximise welfare for everyone living and working in Singapore. Meritocracy cannot be “take and take” by the best and the ablest without any obligation to serve and contribute.

Re-written: Man, you tell me lah, what to replace meritocracy with? If you work hard, you can get far and you get rewarded. That’s how it’s always been here. I think, I’m not sure, I mean… you go figure why the brand name schools are in rich people’s neighbourhood. But just because you are among the best, it doesn’t mean you think you are entitled to all good things in life. So give more of your time to the community, more of your money, more of your whatever…

Response: I can take meritocracy lah. But now I live in an HDB estate, and went to the school near my home. That school ah can’t be compared to the brand name ones, which got swanky buildings and smarter teachers. So these people don’t start from the same line as me, and therefore, can probably run faster and further from me. I get left behind how? Of course, if I become a doctor or lawyer, I definitely will do more for the HDB people, like give free legal advice or free medicine. (Even if I don’t, how can you tell?)

3. Even if we increase our total fertility rate to 2.1 in 2013 suddenly, we will need to import labour to care for the elderly over the next 20 years. The babies born now or in the near future will not be ready to look after the 900,000 baby boomers retiring over the next 20 years.

Re-written: You know, even if every couple have two children from now, we still won’t have enough people to take care of the old. People like your parents, you know how many there will be over 20 years – 900,000! So can stop grumbling about foreign workers and nurses and care-givers or not? You think you can take of so many people by yourself?

Response: You think my parents are what kind of people? They are educated, got degree, got savings, got medical insurance. They know how to keep healthy. Anyway, are you trying to scare me with 900,000 old people? For all you know, they will move to Johor or somewhere not so expensive. They are already complaining its crowded here.

4. Our public hospitals will continue to give good care that is accessible and affordable to all. But we will have to continue to have waiting times and the latest high-tech expensive care options will not be available to all.
Ultimately, health care is a trade-off between affordability, accessibility and quality. Usually, quality in terms of expensive care is of a lower priority, although we will not compromise patient safety. This is true for most developed countries in the world.

Re-written: When you get sick and go to hospital, you know you can pay your bill. Really! Believe me! Okay, so you have to wait a bit to see a doctor, and maybe that expensive drug or machine cannot use Medisave to pay for. But what to do? Everywhere else, the same.

Response: Touch wood! I don’t want to get sick at all. And are you sure I can still pay for medical bills when I get older? I don’t think the Medisave is mine. I mean, it’s mine but I can’t use the money for some things unless the Government says so. I suppose I can buy a lot of health insurance policies or just go somewhere else where it is cheaper to get the drug or medical treatment. Wait a minute! What if I can’t afford the drug? I will probably die? Cannot be.

5. We will make our public transport reliable again and increase capacity. But COEs may never go back to the days of old again. There are limits to our car population just as there are limits to our human population.

Re-written: Face it, kid. You might not even be able to buy the COE, much less the car. You think you can turn back the clock and get $1,000 COE? Fat hope! Anyway, can you imagine how crowded the roads will be? You might as well take public transport. Don’t worry it won’t have so many breakdowns and you will be able to breathe on the bus and train.

Response: You sure bus and train fares will still be cheap? I mean, someone has to pay for the drivers and all that right? COE? Huh, already given up hope.

6. We will limit the influx of foreign labour to Singapore, but we cannot shield our workers from competition. The reality is that our workers will still be competing day and night, 24/7 with workers in China, India or Indonesia

Re-written: We heard you. So we’re going to scale back getting foreign workers in. But, you know what? Don’t think just because there will not be so many of them here, you can sit back and relax and collect your pay cheque every month. Don’t forget that the Chinese, Indians and Indonesians are working very hard in their own countries. If they make your company go bankrupt, then what you do?

Response: Yah lah. Yah lah. How many times you must repeat this?

Go to http://www.breakfastnetwork.sg for the New Normal Labour Market, What’s all this about giving transport operators money and the very minimal explanation against a minimum wage scheme

Why is my salary STILL so small?

In Money, News Reports on March 4, 2013 at 2:07 am

I don’t think anyone is going to object to getting a bigger pay packet and it seems that seven in 10 workers might well be made very happy with the Wage Credit Scheme going by what ST reported today.

The question is whether employers will bite – and why not, you say? Well, the worry about what happens after the three years of wage subsidy is up will be on their minds. Can they afford to take up that 40 per cent portion of G-funded wage rises, especially if productivity efforts did not work? Will they clamour for a continuation of that gigantic $3.6 billion package, given that, hmmm, the next general election will be due then? The political pressure will increase for continued help with even more dire scenarios of companies closing shop painted.

Another issue that hasn’t been quite canvassed: The reaction of workers. I think we can expect pressure of another kind, this time on employers to raise pay. Expectations of seven in 10 workers will rise. All will be scrutinising the size of their wage packet and doing their sums on whether they should have got more, given that the G is giving bosses a helping hand. Employers will be doing their sums too with an eye on Year 3, and might well be more careful in doling out pay raises. So expect dashed expectations.

I guess some workers will also argue that since the G is already willing to give 40 per cent and the employer has already thought about a pay rise, then the pay rise should be more than 100 per cent. That way, wages are definitely raised – which is what everyone likes, no? They might not view the G subsidy as an effort to help the companies use the money for productivity improvements. The argument will be: since the G is giving you money, you can afford to give us more.

This will be a pretty short-term view, but mightily important to those earning less than $4,000 a month with children to raise and bills to pay. After the three years, then what? If the company cannot sustain its wage bill on its own steam, then woe betide those who have enjoyed three good years. I can hear the clamour: the scheme should continue or you’ll see how I will vote come 2016.

I think the objectives of the wage credit scheme should be clarified for the common man, to contain expectations that their wages will increase dramatically because of this help. That the effort is more about helping employers to restructure and re-skill their workers so that at the end of three years, both employer and employee will be comfortably off. This means workers must have a clear idea that they in the scheme along with their employers, that they have a stake in making the company work smarter so that they don’t find themselves worse off after three years. It means that within the three years, you don’t going looking for another job because it pays a bit more, that you have an obligation to the taxpayers, really, who are funding your pay increase to give your companies some respite.

Therefore, the objective of the Wage Credit Scheme must be clear and not only directed at employers, some of whom might well game the system for their own ends. It is important as well to reach those seven in 10 workers, not a small number, who will be waiting for a fatter wallet.

READ http://www.breakfastnetwork.sg for a Chef’s Special on how EMPLOYERS might react to the Wage Credit Scheme

Shift gears = New fears

In Money, News Reports, Politics on February 27, 2013 at 12:19 am

I reckon that the best thing about the debate on the Population White Paper is that most of us will be able to comprehend the Budget 2013 much better than in the past, when we will probably be zooming in to see what’s in it for us.
So many reactions now, so here’s a summary of some new points that have emerged following DPM Tharman’s speech yesterday culled from media reports.

– The construction sector, that really unproductive part of the economy, is going to be hit so hard that it will be a wonder if we can get our infrastructure plans in place. Construction companies which have been going around the quotas by paying a $650 monthly levy for every additional foreign worker will have to pay more, $950 next year and $1,050 in 2015. Now that’s a psychological barrier that’s being breached. Smaller companies are expected to fold or merge.

– The retail and restaurant business people are extremely angry that they have been hit so heavily with higher levies and lowered quotas on foreign workers. Some operations simply cannot be automated, they say, and no matter how much you pay, Singaporeans just won’t do certain jobs. Seems though that there is some kind of workaround: A flexible job scheme that was piloted in the hotel sector to get foreign workers to multi-task will be extended to the whole services sector. So a waiter can double as a dishwasher in this new scheme (hate the word!) that will have its own quotas? Seems we’ll hear more about this later.

– That Wage Credit Scheme in which the G foots 40 per cent of pay rises for those earning less than $4,000 a month might well prove to be a double-edged sword. Bosses may feel compelled to pay people more than they are worth; people would start expecting higher pay even though there is no increase in productivity. And what happens after Year 3, when these credits stop? Can companies afford to foot the wage bill? Would their companies have had enough time to re-structure and raise productivity by then to justify the cost of manpower? The opposition parties, the Singapore Democratic Party and Reform Party, have weighed in too, suggesting a minimum wage law would be a better instrument.

– Some real drama is playing out in car companies. First, they had to deal with last minute orders with people started shopping on Monday night to beat the clock – higher cash payments, ARF etc will kick in. Now, people who had ordered cars are calling to cancel because they don’t know how the new figures will play out. There’s a shift of gear here: the G seems to be moving from curbing car usage to restricting car population. Not fair, the car people say.

– The Workfare Income Supplement to give cash/CPF support to those with low-paying jobs should be extended to part-timers, said an economist. Calculate the income support on a per hour basis, he suggested. This might well bring in more workers into the fold and up the resident workforce numbers.

I’m looking forward to the debate. Stay tuned to this blog and http://www.breakfastnetwork.sg

A ground level look at Budget 2013

In Money, News Reports, Politics on February 26, 2013 at 2:30 am

What’s there not to like about Budget 2013? That depends on what’s your instinctive reaction after hearing/reading DPM Tharman speech yesterday?

Aspiring first-time car owner: “What? Forty per cent cash down for a car? How can? Can those China-made cars please come back? Wait, the COE will be higher than the price of the car..’’

Rich guy: “How dare they tax my second home at the Sail, my third at Sentosa Cove and my fourth in Bukit Timah! Time to buy a building at Iskandar.’’

Befuddled economist/pseudo economist: “The government is paying employers to pay workers who get a pay rise? Why not just implement a minimum wage scheme?’’

Sandwiched class: “Damn! More income support for the lower-income. From MY taxpayer money. Why don’t just cut GST and everyone will be happy since it’s most regressive tax around and G made so much surplus already?’’

Big -flat homeowners: “Again five-roomers and executive flat people lose out. The Government think we all not poor just because we live in bigger places ah? Better downgrade and use the Silver Housing bonus – but I love my big place!’’

About-to-be bankrupted restaurant owner: “I will now close my restaurant. I can’t get foreign workers and the Government not even doing anything about my rent. At least can tahan if rent not so high.’’

Earning below $4,000: “My boss had better give me a pay rise now since the Government is subsiding 40 per cent. Actually it means my pay rise can be higher BY 40 per cent from whatever my boss thought. But I bet the stingy fella will just save the money for himself.’’

Panicked mother: “At least got more kindergartens than just the PAP and NTUC one. MOE also starting its own. I think everybody is going to go to the MOE one. Sure got standard, got subsidy. Better queue now while Ah Boy is six months old.’’

I don’t mean to pour cold water over the Budget which I think is pretty cool. This is a G with ideas taking a big picture look at the present and the future. The budget is characterised as a shifting of gears and I so agree. We’ve been in cruise-control for too long – or running ragged at top gear?

How people react will depend on what bit bit them most. Hard to look at the big picture when you see your new car disappearing into the distance. That promise to fix the transport infrastructure MUST come true! Hard to be happy when you are facing the prospect of closing down your business. I mean, which retailer or restauranteur will say: Actually, this isn’t for me. I should change lines. (And become a cigarette smuggler: sure got demand! Kidding ok…)

I liked that steps are being taken to address income inequality; whether they are bold enough is the question of course. But, at least, something is being done to raise their incomes while at the same time sustaining the smaller enterprises who scream about lack of foreign manpower.

My worry about such handouts have always been whether the enterprising enterprises will find a way to “game’’ the system, not just the Work Credits scheme but also Workfare Income Supplement and Productivity Innovation and Credits scheme. Big money is being paid out, what are the checks and balances and at the end of the day, how do we measure results?