Tuesday, August 31, 2010

NSP: Response to PM Lee's Nation Day Rally Speech

We are glad to hear the Prime Minister addressing the various key problems that we have been raising for the past one year in his National Day Rally speech.

However, at closer examination, we have the following key points to make:

$60 billion for MRT infrastructure over 10 years

1. Where would the government get the funding of $60B from?

2. Will the PAP government increase the GST to 10% or raise other taxes to get additional funding? Will the public transport fares increase to finance this expenditure?

3. Will the PAP government keep to the promised time frame of 10 years? The PAP government has delayed various important infrastructure projects, like the building of hospitals as well as the Downtown line, which have resulted in the increased cost of construction. Will the PAP government promise to keep to the budget of $60B instead of allowing it to balloon out of control, just like what happened to the YOG budget?

Measures to keep Housing Affordable

1. We are very confused by the various contradictory signals that the PAP ministers have sent within these few months:

a. Late last year, Minister Mah Bow Tan claimed that housing was still affordable, and that the influx of immigrants was not a main factor causing the rise in resale prices. But now the Prime Minister has acknowledged that the influx of new immigrants has contributed to the rise in resale prices.

b. When Minister Mah put up the first few measures in March 2010 to curb rising resale prices, some Singaporeans questioned the inadequacy of such measures. Minister Mah defended his ministry’s decision and said no other measures would be necessary. But just 5 months down the road, Minister Mah has introduced more drastic measures to curb property prices.

c. In March 2010, Minister Mah claimed that the supply of flats was more than sufficient to meet any surge in demand. However it seems that his ministry must now go into overdrive to ramp up the supply of BTO flats.

d. In March 2010, Minister Mah raised the minimum occupation period for resale flat owners who take bank loans from 1 year to 3 years. Barely a few months later, the ministry is now further pushing it up to 5 years. It seems that HDB is unable to provide any policy stability at all.

e. On 26 June 2010, MM Lee said there probably isn’t any property bubble. But now, Minister Mah admits that a property bubble is in the making.


2. In December 2009, after admitting to being “caught off guard”, Minister Mah reassured us of the ministry’s ability to keep this problem of “unexpected” rise in property prices in check. Yet the contradictions as noted above clearly signal that his ministry continues to lose sight of the severity of the problem.

3. The latest drastic measures have caused unwarranted shocks to the whole system. Those who have based their purchases of HDB flats or private properties on the past policies will face great financial losses. The frequent policy changes will erode investor’s confidence in the government’s competency in dealing with such problems.

4. As long as there isn’t any fundamental change in the pricing mechanism of new HDB flats and the increasing demand of new migrants (Permanent Residents) is not effectively met by other means, we do not see how prices for both new and resale HDB flats can become affordable. NSP reiterates our stand that new HDB flats should be sold at cost price to citizens. HDB should also consider selling new flats to PR at market price so to ease the demand due to unusual increase in PR population.

Immigration Policy

1. We do not think that the Prime Minister understands the real problems caused by the huge influx of foreign labour on the ground.

2. PM Lee has raised the example of coffeeshop owners unable to find Singaporeans who are willing to work until 12a.m. and thus they need to employ foreign workers. But the truth is, to ask workers to work 14 hours or more in a day is an act of exploitation. The labour law should be applied equally on both local and foreign workers. We cannot allow employers to exploit foreign workers just because Singapore workers are unwilling to be exploited.

3. We also notice that there are firms putting up recruitment advertisement which discriminate against either Singapore citizens or races. The liberal FT policy that the PAP government has adopted is partly to be blamed for this discrimination of local Singapore citizens by businesses. This practice has to be stopped and NSP urges the government to set up Commission of Equal Opportunity and setting laws to outlaw discriminatory employment practices.

4. PM Lee has ignored the severity of the depression of wages of both middle and lower income earners due to the influx of foreign labour. There is no mention of any concrete plans to deal with this problem.

5. PM Lee may think that foreign labour will help to create jobs for Singaporeans but the reverse is also true. Many Singaporeans’ jobs have been displaced by foreign labour. The problem is so severe that engineers and managers are now becoming taxi drivers. We have invested lots of money in the education of our citizens but such displacement of jobs of foreign labour has effectively made our investment wasted. Here again, there is no mention of any concrete plans to deal with this problem by PM Lee.

6. Raising workers’ levy alone will not help much in preventing engineers and professionals being displaced by foreign labour. Raising workers’ levy will not prevent exploitation of foreign workers nor save jobs for citizens.

7. Last but not least, this liberal immigration policy has caused a serious problem of income disparity within our society. Wages of both middle and lower income earners have been depressed while some have basically lost their jobs and face underemployment or even unemployment. The widening of income gap and the diminishing of middle class are great concerns to social stability but the Prime Minister has not addressed it either.

Conclusion

Although we feel that the Prime Minister has put up a very good pre-election National Day Rally speech but we still find that the solutions that his government has provided are generally inadequate.

We must bear in mind that all the problems and issues addressed by the Prime Minister are mostly the result of oversight by the various ministries under the charge of the respective ministers. All these problems are not new and have been raised by many people including NSP over the year. These problems could be long anticipated as it is the direct result of PAP government’s deliberate policy of opening the floodgates for foreign workers and migrants to come to Singapore. These “caught off guard” ministers should be responsible and made accountable for their deficiencies.

We also note that the Prime Minister did not resorted to giving out goodies or red packets to citizens as a populist tactic to win support. We would be impressed if PAP decides to abandon its past undesirable election tactic and choose to contest the elections based on its policy views, ideas and plans instead. We would be even more impressed if PAP could put up the boundary report way before the impending general elections. It will open up a new era of healthy political competition and engagement for Singapore.

Goh Meng Seng
Secretary General
National Solidarity Party

3 comments:

Anonymous said...

After a long hiatus, sale for balances of flat suddenly made its appearance, but if anyone did a check on the listed price, you will find a 30% premium for new flats in Sengkang and Ponggol area over the last balances of flat. Without saying its true purposes of withholding so many unsold flats amidst an impending property bubble, who know what Mah Bow Tan was thinking.

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Anonymous said...

we only have so many flats, condos and houses for staying. Without increasing housing supply like we attract FT into the country, the economics are easy to see, demand outstrips supply!
Looking at MBT track record, which I give him a 2/10, he is clearly is not qualified to run real estate companies like FEO or CDL, otherwise, he will screw up both the companies. Wonder how on earth the cabinet can justify paying him market rates (when the market probably don't even want him)!