Thursday, February 04, 2010

NSP's views regarding the ESC's recommendations

NSP's views regarding the ESC's recommendations
Fri, Feb 05, 2010
What is NSP's views regarding the ESC's recommendations?

In general, we appreciate the government’s effort in trying to deal with new economic challenges in the next decade. However we feel that ESC is trying too hard in dissecting economic issues without realizing that the model of economy is tightly linked to the social-cultural- political aspects of the Nation. These “software” of the Nation will mold the mindset of the citizens which in turn will impact on how the economy will develop in reality.

We need a more holistic approach instead of formulating quick fixes for short term gains. The U-Turn on the FT policy is a classic example on how such quick fixes applied in the past may just become irrelevant and worse, creating irreversible damage to our social fabrics.

For a start, we would like to see the government play their role in assuring adequate housing for every Singaporeans. While we take care of foreign workers and students’ housing needs, we should not leave our citizens living in the wild without a roof over their heads. Housing is a basic needs for citizens before they could work on upgrading their skill sets and contribute to the society.

Secondly, if we want our workforce to be more creative and innovative, an atmosphere of creativity, innovation and dynamic democratic vibrancy should be built based on a more open democratic system whereby diverse views are tolerated in schools, work place, civil service and the political sphere.

Which specific areas/aspects/ issues/recommend ations does NSP agree with the ESC? And why?

We have no issues with ESC’s broad direction as presented in their report although there is nothing specifically new. However we wish to highlight specifically the point on strengthening support for low wage workers and dependency on foreign workers which are more of a concern for these few years.

We felt that this is long overdue. Our low wage workers have their salaries depressed by the constant influx of these foreign workers, making their livelihood tougher by the day. While many of these foreign workers enjoy very low rent flats provided by HDB, many of our citizens have to manage life with a mortgage of higher amount. Sometimes, they are even deprived of a roof over their heads while HDB demanded them to wait for 30 months before they could rent a flat from it.

We have been expressing grave concerns about the government’s over-reliance on foreign workers since decade ago at every opportunity. We are finally glad that the PAP government, through the ESC committee, is finally taking heed to deduce this dependency.

On the other hand, which specific areas/aspects/ issues/recommend ations does the NSP disagree with the ESC? And why?

First of all, we are concerned about ESC’s suggestion to “Price energy to reflect real costs and constraints” on the household sectors. We would like to understand more in details and monitor the pricing implementation process to ensure households are not severely burdened.

Singapore’s energy pricing is already on the high side in this region. We should take care of implementing pricing policy that would affect our costing in living as well as doing business.

Secondly, we do not agree to ESC’s recommendation to look into nuclear energy as the alternative energy source. Singapore is too small a place to take the risk of having a nuclear disaster of any sort.

Thirdly, we feel that it is totally inadequate for ESC to focus only on labour productivity. We should be looking at Total Factor Productivity as well, which will include Capital Productivity.

While the government pays lip service in grooming local SMEs, our over reliance on MNCs and GLCs has impeded the growth of our local SMEs. A more relevant study should be done on the economic model of Korea and Taiwan. These governments play an active role in providing funds and facilities for technological research and upgrading their enterprises into Original Equipment Manufacturers (OEM) instead of mere vendors providing parts and services for MNC plants.

ESC has made bold vision about building Singapore into a Global-Asia City but we feel that Singapore should leverage more on its regional role. What is missing in this ESC report is the strategy of more integration in regional economies, creating an economic hinterland for Singapore. There is no mention about whether Singapore will work actively towards a more comprehensive Free Trade Zone in Southeast Asia or even Southeast Asian Economic Union. We feel that Singapore should start the economic integration with our closest neighbours and expanding to other ASEAN countries in the long run. We need an enlarged consumer base before our Nation could maintain continuous growth for decades ahead.

The focus on innovation and creativity should not be measured solely on dollars and cents spent in research. The cultivation of innovation and creativity needs a whole generation of mindset changed through our educational system as well as political climate. There is no way for a nation to depend solely on foreign researchers for their sustainable economic growth. Our people must be cultivated through their daily lives. Let’s start with our political climate.

Goh Meng Seng
Secretary General
National Solidarity Party


LuckySingaporean said...

The ESC formulated these strategies without putting Singaporeans at the center of the strategy. Ultimately, any strategy has to result in economic benefits for the vast majority of Singaporeans and the starting point has to be solving the economic problems faced by Singaporeans today - income inequality, structural unemployment, high cost of living & inability to retire gracefully. To solve these problems we start by understanding the causes.

The ESC is really a rehash of old ideas cut and pasted from 1991, 1983 committees. Productivity & innovation are the same old stories...what about reducing the cost of living to make Singaporeans more competitive?

The outcome of the ESC is not surprising given its composition of mostly ministers and business leaders - this can only lead to pro-business strategies and superficially addressing real issues.

Anonymous said...

Hi Lucky

I did a posting in your blog about how in all likelihood, there is actually NO SOLUTION to the problems you hve raised here.

The world is still in the process of adjusting to the IT revolution which has broken down national boundaries.

Even if we played a "perfect hand" of economic policies, the best that can be done are policies to minimise the pain of transition.
I would wager that the income of Singaporeans are likely to stagnate or fall over the next 5 to 10 years.

The PAP's current policies are of course far from being a "perfect hand". We seem to be lurching from one failed policy to the next.

Now we have a "new plan" which looks suspiciously like the old plan. If it was not working then, why should it work now?