NSP Response to Budget Statement 2011

NSP Response to Budget Statement 2011

The National Solidarity Party is very disappointed that the PAP government has not addressed in this budget the fundamental question on whether the current economic growth model of “Growth at all cost” based on indiscriminate importation of foreign workers at ALL LEVELS of employment should carry on. Instead, it tries to address the “ill symptoms”, which are caused by this flawed economic strategy, in such an inadequate way.

While the excuse of low fertility rate is cited as the main reason to import excessive foreign workers into Singapore, the miserable $300 to $400 Child Development Credit is totally inadequate to address this problem. We would expect healthcare cost to be lowered or a comprehensive social safety net for children up to 18 years old or heavy subsidy for pre-school education etc. The little top ups to students’ Edusave by $130 could hardly offset the enormous increase in tuition fees over the years. Apparently there are not enough subsidies given to tertiary institutions to defray the rising costs. On the other hand, there are no new initiatives to strengthen work-life balance for couples so that they could enjoy family life with their children.

The only “real” solution to the low fertility rate provided by PAP government is to depend on the influx of foreign workers. Although PAP has increased worker levies but it falls short of giving us the assurance that the number of foreign workers, thus population, will not grow any further.

The first critical problem of having excessive foreign workers is, either citizens' jobs are displaced or wages are suppressed by them. PAP has chosen to increase workers levies while giving more workfare to citizens to address these problems. However, we believe that without a minimum wage scheme, the effectiveness of both the workfare and worker levies will be dampened (due to substitution effects).

The influx of cheap foreign labour has apparently suppressed wages and thus widened the income disparity. According to the chart shown in the budget speech as well as what the Finance Minister has said, the real income growth of the 20th percentile in the past decade would only be 5% instead of 8.1% if it was not for the workfare. The income disparity has widened when the real income growth for the 50th percentile is 20.7%!

There is no doubt that workfare has managed to close the gap of the widening trend just a bit but the most important question we have to ask: is this economic model sustainable in the long run? Can the PAP government guarantee that it will keep giving out more and more workfare in the years to come in a bid to cushion the impact of the widening of income gap?

We are very doubtful about the Finance Minister’s assertion that the real income of all our workers could grow by 30% for the next decade. While we are only able to raise the income of the 20th and 50th percentile by 8.1% and 20.7% in real terms respectively with a corresponding average growth of 4%-6% in GDP for the last decade, how can we possibly achieve a higher growth of 30% in real terms for ALL Singaporeans when our Finance Minister only expects our economy to grow at a slower pace of 3% to 5% for the next decade? We believe that only the million-dollar salaried ministers will enjoy more than 30% increase in real terms in the coming decade!

In the mad pursuit of more foreign workers, the PAP government has taken the lead to cultivate the mindset that only foreigners are “talents” while Singaporeans are not. The government should not put too much emphasis on foreigners as talents. Our homegrown MNCs should emphasise more on grooming our Singaporean PMETs instead of replacing them with “foreign talents”.

We do not think that the effort to raise productivity would bear fruits in raising our citizens' wages as long as PAP continues to let the whole world supply us with cheaper and younger foreign labour indiscriminately. The economic growth model needs a major overhaul. Comprehensive plans should be put in place to groom local SMEs as well as local talents with global view.

The sudden rapid increase in foreign workers has also caused a whole range of other problems, from rising inflation to inadequate public transport and healthcare infrastructure as well as high housing cost. However the PAP government has not effectively addressed all these issues at all.

The Minister says he wants to help Singaporeans to fight inflation but yet he has conveniently avoided mentioning anything about GST. Either GST should be reduced or at least stay permanent at 7%, but there is no commitment from PAP at all.

In spite of a shortage of hospital beds, the budget for Ministry of Health has been reduced for 2011 resulting from a cut in “development expenditure”. We are surprised that the government has cut healthcare funding but increased the defence budget by a substantial 5.4% instead.

On the property front, we believe that the key issue of high HDB price lies with the pricing policy of new HDB flats. NSP advocates cost-plus pricing for new HDB flats. Giving more grants to low-income buyers will not solve the burden of 30-year mortgage tagged on these flat purchases.

In conclusion, NSP would want to make an open call to the PAP government to set its priorities right. The PAP should not merely focus on giving away goodies to voters in this election year. but focus on the long-term structural problems of our economy. As long as the ruling party refuses to realign its economic growth model for the coming decade, we will forever face the critical problems raised above.

A responsible government should take the welfare of our citizens at heart in longer terms instead of engrossing itself in populist policies which may temporarily alleviate unhappiness on the ground but are totally unhelpful in solving our longer term structural problems.

Goh Meng Seng
Secretary General
National Solidarity Party

Afternote: I have some feedback, including from my wife, that some of the technical things are difficult to understand. Especially the part in bold.

The logic is this, the Finance Minister Tharman claims that in order to continue to have real income growth, we need GDP to grow continuously. But the question is, by this logic, how could we have HIGHER REAL INCOME growth with LOWER GDP growth? He was talking about 30% REAL INCOME GROWTH FOR EVERYONE! But, in spite of the fact that we had HIGHER average GDP growth in the last decade of 4%-6%, the real income growth for BOTH 20 percentile and 50 percentile is far lesser than 30%. He then projected that we will have LOWER GDP growth for the next decade at 3% to 5% but expect REAL INCOME growth to be HIGHER! On top of that, with the present economic growth model the real income growth is going to be unequal and income disparity will widen. It is really impossible to have EQUAL real income growth for everybody. It is really an amazing contradiction or simply MISSION IMPOSSIBLE.

Budget 2011 - Back to Basics

Many Singaporeans are expecting "BIG ANG BAO" (Red Packets filled with money) from the government for this year's Budget because this is an "Election Year". How big is big? $1000? $2000? Some even suggested $3000!

I have no problem if such cash handouts are given with full sincerity to help Singaporeans to cope with runaway cost of living. But if this is another exercise of "Fix Opposition and buy votes", I would be very disappointed that we have not progressed nor matured at all politically.

But what matters most for Singapore at this juncture is that the ruling party has "gone astray" from basics and fundamentals of governance. When the ministers' pay is tied to some "KPI" which includes GDP growth as the main component as well as the salary scale of those top earners in Singapore, it will inevitably create the mindset of "Growth at ALL COST". The widening of Income Disparity would not be the top concern of this government because what matters most would be how much the top income earners would grow!

The appropriate way of pegging the salary of ministers would be pegging it at different percentages at different percentile of the income of Singaporeans. eg. 500% of 10th percentile + 400% of 20th percentile + X% of 30th percentile +....+5% of 90 percentile. Maybe it could also include GDP growth in per household capital instead of GDP growth alone. Only such KPI will make the ministers more focus on "Quality Balanced Growth" in GDP as well as the plight of the lower income earners!

By now, Singaporeans should realize that it is actually quite easy to push for high GDP growth. Just introduce vice like casino gambling, just increase enormous amount of foreign workers in a short time and just give huge preferential packages to foreign MNCs to set up shops here. Never mind if the MNCs are providing more QUALITY jobs for Singaporeans or not or whether casino gambling will erode work ethics and cause irreversible damage to our social fabrics or not.

The side effects of such "Growth at all cost" strategy has finally reached a boiling state. All warnings sounded previously about inflation, run away prices of HDB flats, overcrowded public transport and hospitals etc.

Some may wonder why would inflation be blamed on this "Growth at all cost" strategy? There are already analysis on the internet which touched on the impact of "non-tradable" goods and services on inflation. Non-tradable goods and services refer to things that we could not get from importation. These include land, health services, barber service, taxi service, supermarket/market etc.

The sudden rapid increase in population would have caused great demands on various goods and services, both tradable and non-tradable. Singapore could well import as many food and other products from other places to meet such demands. Most of the inflation on tradable goods are due to factors beyond the government's control. eg. Food and commodities. They could well increase the strength of Singapore dollars via foreign exchange intervention to offset most of such inflation.

But for non-tradable goods and services, there is no way we could meet the sudden increase in demand by a spur in our mismanaged population growth. Especially rental for commercial space has been pushed up significantly, worsen by the fact that retail space has been more or less monopolized by a cartel of big GLCs.

For critical services like hospital healthcare, it is really an eye opening when our restructured hospitals were so strained by the spike in demands, they are still going around the world to promote their "medical tourism"!

There a lot of problems with the economic situation in Singapore right now but the source of problem is only one: the misadventure of wrong economic direction. If we do not solve this root problem, we will be stuck with all these problems of high inflation, shortage of housing, medical care, public transport... for years to come.

It is time for the PAP government to go back to the basics. There is nothing wrong with a slower growth with higher growth in income per capital for Singaporeans. There is nothing wrong to cut down cheap foreign labour substitutes which take our jobs and suppress our wages.

It is only when the direction of Economic policy is changed, the companies in Singapore will react accordingly to raise productivity in view of higher labour cost.

It is only when PAP government review the need of the Casino resorts, we will always be threaten by the huge social impacts which these vice activities brought upon our nation.

I would like to see the PAP government address this very important issue for this coming budget instead of dealing with "ineffective medicines" to address all the ills created by their previous economic policy.

Goh Meng Seng

Honest Talk on Race

It was a tiring but fruitful week right after the Chinese New Year celebration. National Solidarity Party Malay Bureau has successfully conducted its first Malay Reflection Forum on 11 Feb 2011. We have learned quite a number of things through this forum.

The other forum was conducted by James Gomez on 12 Feb 2011 touching on racial discrimination and a preview of his report on the UN Rapporteur visit to Singapore.

In both forums, we had honest talks over racial issues. From religion, social, culture (pop culture), education to job discrimination etc. Yes, we can. We can hold public talk, honest talks over such "taboo" racial issues.

In the NSP Malay Reflection Forum, the very first response from the participants was about "Freedom of Expression" with regards to racial issues, or just issues which the Malay community face in their daily lives. Nobody wants to talk about it, in a constructive way.

We also talk about job discrimination. My take is that while Singapore, as a multi-cultural society, has taken upon Meritocracy as the core value of our system, the government should not get into systematic discrimination. The various talks by the leader of the ruling party about what race cannot hold what jobs is least helpful to enhance the bonds between Singaporeans of all races. It is not helpful for them to declare "We are not ready to have an Indian Prime Minister" or "We cannot have Malays as machine gunners, air force pilots, generals" etc. My position is that we need to set up an Equal Opportunity Commission to look into discriminative practices in employment. As a Chinese, the so call "majority", I also feel discriminated when job advertisements open declare that "PR and Foreigners preferred"!

In the forum conducted by James Gomez, the issue about HDB Ethnic Quota was raised again by the well known human rights lawyer M Ravi. He has asked me about this question back in TOC Face to Face forum in December 2010 and my answer didn't satisfy him. Thus this issue was raised again.

My stand is that the HDB Ethnic Quota should stay but it could be modified or relax by have a range of not more than 50% for "minority races" and not more than 85% of Chinese in any precincts. It doesn't sound good to human rights activists who will still maintain that this is "discriminative" rules which disadvantaged the minority races in terms of lower sales values of their flats etc.

I have explained that congregation and segregation of different races will not do us good. An Australian couples whom I met have praised Singapore's HDB Ethnic Quota because of their experiences back in Australia. In Australia, when left alone, the various different races congregate and segregate themselves. Racial tension increased due to such setting.

As a student from a SAP school which is predominantly a "Chinese school", I have experienced first hand how racist stereotyping could arise when a single race congregates together.

Thus, I have to make the difficult political stand to keep the HDB Ethnic Quota in a modified form, to cushion the impact on the minority races. Of course there are both people who agree and disagree with me on this issue. I would agree to disagree.

Issues on Thaipusam and MM Lee's remarks on the Malay community were raised as well, by Mr. M. Ravi. Well M. Ravi has, unconsciously and unintentionally, made a "racist remark" or "racist stereotyping" that Chinese are racist and that, opposition members have not raise objection to these issues.

I have to correct him again. My colleagues, especially Syafarin, who are present at the forum, would have known that I was very upset about the new rules on Thaipusam as well as the remarks made by MM Lee in the new book. I explained that I have issued a statement on behalf of NSP AFTER Thaipusam. I would be putting my party and members AT RISK if I issue a statement BEFORE Thaipusam and any riot happened during that event, the ruling party may take the opportunity to detain us under ISA for "inciting racial riot"! It is a political judgment I have to make.

Having been through these two forums, I must say that all these were discussed in a rational and civil way. I think one of the greatest achievement we have made is to prove to the authorities that sensitive racial issues could be debated, discussed in a very calm and civil way. We have matured intellectually as a people and there is nothing too taboo to be discussed or debated in public forums.

Goh Meng Seng

Reservist as an Officer

I have just completed my annual In Camp Training (ICT) in January and I guess many of the Mindef people are waiting for my usual reports on this blog with regards to the ICT.

It is always good to meet up with old buddies and men. However, many of them will MR (i.e. completing their NSmen cycle of 7 High Keys and 3 low keys or going to pass 40 years old). But some officers have completed more than 7 High Keys (ICT more than 5 days is considered to be 1 High Key) and some like me, are 40 years old or above, are still serving.

Ever since Mindef announced the changes made to the 13 year cycle to 10 year cycle, there are confusions among the officers. Many officers thought that they will only need to finish 7 High Keys and 3 Low Keys and they could MR. This is not true. Officers are liable for reservist training UP TO 50 YEAR OLD.

But some officers are "lucky" that they MR together with their units; especially those "mono-intake" infantry or Guards units way before 40 years old. Thus the confusion was deepen when logistic officers who are in "evergreen units" like mine are required to serve way beyond 7 High Keys and 40 years old.

This disgruntlement is primarily due to poor manpower planning of succession. At the end of each and every of my ICT, the discussion on succession planning always dominates the meeting. Succession planning for officers as well as key NCO postings like CSM, CQ etc is pretty weak. Officers with special technical skills like signal officers are lacking.

Even for my position, MTO (Motor Transport Officer) is lacking. I was sent for two courses during my reservist, both about 2 to 3 weeks each. These are supposedly to be considered as High Keys but it seems that there are rumors courses attended during reservist period are not considered as High Keys! This created much unhappiness on the ground and if Mindef did not come clear on this issue, we will find less officers willing to attend prolonged courses like mine.

Two to three weeks off from our normal work routine to attend military courses are big sacrifices to NSmen officers. It would be unfair to them that all these time spent are not going to be considered as High Key ICT.

Such treatment will aggravate the succession plan for Officers. i.e. If no Officers are willing to attend courses, how could they take on the roles of their predecessors?

Quite a number of officers (as well as warrant officer) in my unit have completed more than 7 High Keys. Some of them chose to sign on as Rovering key appointment holders. Their dedication to National Service is really commendable.

But I think it is unfair for other officers who have completed the needed 7 High Keys and who have reached 40 years old and above to be made to stay just because of the failure of succession planning by the S1 or G1.

Service Officers should be treated fairly as the Combat Officers. If Combat Officers could MR even before they reach 40 years old, why should Service Officers made to stay on beyond 7 High Keys and 40 years old? Such unfair treatment is going to affect the morale of the Service Officers.

I am raising this problem not because my fellow officers in my unit are complaining nor unwilling to serve. We treasure our comradeship and companionship. But in this highly competitive job market, people are worried about their jobs being taken away by FTs who do not pose such disruptions to the company's work routine. Whether we are Officers or men, we face the same constrains and competition on the job front.

The additional problems we officers face when we are serving above 40 years old is IPPT. For any servicemen, you are required to take the IPPT even when you are 40 years old and above. However, we have to take the FFI (a medical check up to certify fit for IPPT) every year. Sometimes, the FFI may drag due to additional medical check up needed. By the time the FFI is done, the window left for IPPT will be very limited.

After going through all the trouble of FFI, we are required to take only THREE stations for the IPPT. This is pretty ironic.

Most reservist officers who serve beyond 40 years old are service officers (logistic officers) like me. Our main role is to provide combat service support to the frontline troops. We are not required to go on physically strenuous combat missions but most of the time, we do a lot of planning on logistics deployment. i.e. We are using more brain power than muscles to complete our missions.

Thus it is kind of inconvenient irony that we are still put through the hassles of FFI and IPPT. The main risk in taking IPPT after 40 years old lies in the 2.4km running. There is totally unnecessary for service officers to take such risks especially so when they are already serving unfairly more than Combat officers.

Personally I am most willing to serve up to 50 years old if the hassles of FFI and IPPT are taken off. Almost all my men in my unit know I am "the opposition man" but I always tell them, even opposition man can be a good soldier. It is a kind of National Education by example that opposition members can be "deadly patriotic" too.

I hope Mindef, especially G1 has to come out and clarify certain things for officers, especially for logistic officers who need to attend courses. I also hope that succession planning for logistic units should be done properly by G1 so that most logistic officers would be treated equally as their combat counterparts. Last but not least, the requirement of IPPT for those NSmen officers above 40 should be reviewed or scrapped totally (especially for logistic officers).

Goh Meng Seng

Afternote: BTW, I am very sorry that I may have caused some anxiety within my unit's admin.

This article is specifically written for higher authority (i.e. G1 & Mindef) to reconsider their policy directions and not meant to doubt the efficiency and effectiveness of my unit's administration.

The key issues here is about fair treatment to Service Officers vs Combat Officers, as well as the redundancy of the IPPT requirement for those NSmen who are above 40.

Imagine that every year you are required to go through the hassle of medical check up and ended up with a watered down IPPT (i.e. required to do 3 stations instead of 6). It really doesn't make economic and practical sense to me.