Response to Peh Shing Huei’s ST column on “The partitioning of the opposition”

February 29, 2008 by · 8 Comments
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Today, the Straits Times Insight page ran an article written by Peh Shing Huei entitled “The partitioning of the opposition”. The link to the online edition of the article as well as the full text of the article is appended below this blog post.

Peh Shing Huei wrote that in recent months, the opposition has been deeply divided into two camps, which he calls the “moderates” and the “radicals”. According to Peh, the moderates, which comprise the WP, NSP and SDA, are not exactly happy with the status quo and the electoral system, but have opted to “stay within the laws”. What does Peh mean by staying within the laws? By this, he means: challenging the government only through participation in elections and using the Parliamentary setting to voice their views. Peh says that the moderates focus more on bread-and-butter issues, with a low-key delivery, and have a preference for quiet grassroots work. While bread-and-butter issues and grassroots work are certainly topics or activities that all opposition parties should be engaged in, Peh apparently is trying to imply that only the likes of WP and NSP are interested in them.

On the other hand, Peh says that the radicals, which comprise the SDP and the soon-to-be-formed Reform Party, “prefer to operate around the edges of the law”, in his own words. What does Peh mean by operating around the law? By this he means: an eagerness to play to an international audience, and taking a more hardline approach to the PAP, including street protests.

The manner and tone of language used by Peh Shing Huei to summarize the divisions existing in the opposition camp is shallow and utterly devoid of any substance whatsoever. By using the phrases “staying within the laws” and “operating around the edges of the law” to describe the so-called moderates and radicals respectively, Peh has insidiously attempted to tar the SDP and Reform Party with an unsavoury brush, even though his article never really delves into what exactly SDP and Reform Party stand for, what their political ideologies are, and the methods they will use to achieve their aims.

The common folk, if they had not been closely following SDP’s activities and public forums in the past as well as the press statements that the Reform Party has made, might be mislead into thinking SDP and Reform Party have a disrespect for the law, which is most certainly not the case. Instead, it is precisely because the SDP and Reform Party have such great respect for the constitutional rights of Singaporeans, that they are very willing and eager to challenge the government to return to Singaporeans their civil liberties and fundamental freedoms that our constitution in fact guarantees them. The freedom of speech and expression, assembly, and the right to form associations are accorded to all Singaporeans under Article 14 of part IV of the Singapore Constitution.

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Today in Parliament: True that bottom 40% still gain even after paying taxes?

February 28, 2008 by · Leave a Comment
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Finance Minister Tharman Shanmugaratnam produced data to show that the Government’s Budget policy enables the bottom 40% of wage earners to receive more in government benefits this year than they will pay in taxes.

According to him, for this group of people, what they get from the government will also be more than the increase in spending due to inflation.

According to statistics released by the Straits Times, assuming that inflation was 5.5%, a typical elderly couple in a 2-room HDB flat will receive around $3,100 is government handouts, as opposed to increased spending of $650 due to inflation this year. For a couple with two teenage children in a 4-room HDB flat, the numbers are $4,100 and $2,200 respectively.

Included in the above computation are the Workfare Income Supplement, the GST Offset Package which includes GST Credits, Senior Citizens’ Bonus, top-ups to Post Secondary Education Account (PSEA), Utilities-Save rebates, service and conservancy charges rebates, rental rebates and property tax rebates, as well as the 2008 Budget surplus handouts which include Growth Dividends, additional PSEA top-ups, personal income tax rebates, and top-ups to Medisave accounts.

However, using a simplified inflation rate of 5.5% to estimate the increase in the cost of living may not capture the whole story. For one, the increase in the cost of food, healthcare, education, and insurance such as the foreign maid insurance are very often more than the average reported inflation rate. Given that many households with young children or aged parents require foreign maids, and these are also the households that typically require more access to healthcare, the numbers might not be as rosy as they appear. The truth is, Singaporeans are assailed by rising costs from almost all quarters, and those costs experiencing the most rapid inflation are precisely those that impact low income and aged Singaporeans the most.

The rate of inflation for Singapore was 6.6% in January this year, and it may only get worse down the road as commodity prices continue to soar.

One should therefore not assume that the lower income and elderly will be better off this year even with a seemingly generous Budget. There are a lot of unquestioned assumptions in the government’s calculation that supposedly paints a rosy picture for the poor and aged.

Why I can’t Move On

February 27, 2008 by · 2 Comments
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EDITOR’S NOTE: The following is a Sammyboy Coffeeshop forum post made by the moniker MentisMortis

Dear ALL,

While I was still a damp (not wet) behind the ears young adult who was trying to grow out my hair from the standard army coiffe, all of 22 years and in university, I was very much full of ideals and drive to make desperate changes to my surroundings and circumstance.

While at classes, I remember my professor speaking of the Rule of Law, Separation of Powers, Natural Justice, Jurisprudence, Ethical Behaviour and the conventions of Ministerial Responsibility and Popularity.

He did so by citing cases, tabloid and press reports to bulk up that argument, citing the Profumo Afffair, The Belgrano, the aftermath of the abandoned Poll Tax etc to highlight what true ministerial responsibility meant.

Also that English politicians ironically are in fact quite gentlemanly in discharging their duties (despite the red tape they so often weave to protect themselves) and would be very willing to accept full responsibility, with the proviso, if they are caught with their hands in the proverbial cookie jar.

One Constitutional Law Professor went on to so forcefully and eloquently make his point that it actually brought tears to many a female classmate and sent waves of goose pimples among the guys, myself included.

These principles that he so imbued fed the fire of idealism and further stoked that drive within me and in many of my peers.

I remember vividly this professor speaking of the right to choose your leaders, and that if only one person is disenfranchised by whatever means then democracy has died.

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Dr Wong Wee Nam: Why Do We Need 6.5 Million People?

February 27, 2008 by · 32 Comments
Filed under: Current Affairs and Politics, Dr Wong Wee Nam 

Why Do We Need 6.5 Million People?

The Over-Population Problem

On 21st February 2008, a friend sent me an ST online forum letter written by Mr. Yong Koi Kwong on why Singapore should not become a 6.5 million city state.

The writer said: “Singapore is situated in a hot humid equatorial region. The average relative humidity is 80 per cent with a daily average temperature of 24 to 32 degrees Celcius for virtually the whole year. The average number of hours of sunshine is 5.5 to 6 hours. It is very unpleasant to live in such an environment if there is no natural ventilation to take away one’s perspiration.

Our country is unique in that we are a sovereign city state with no countryside. Only half the land could be built up (including about 12 per cent for roads). The rest of the country is occupied by military training grounds, central catchment area, 17 reservoirs and golf courses and five airports or airfields and two naval bases.

In spite of our relentless land reclamation for the last 40-odd years which grew our country to the present area of about 700 sq km and a projected area of 780 sq km, Singapore would be the most densely populated country with 12,800 persons per sq km of habitable area if the population is projected to grow to 5 million. If the population is planned for 6.5 million, the average number of persons per sq km is 16,640.”

He concluded, “We could live with the accolade such as the busiest port, best run airline and airport but the accolade that we are the densest populated sovereign state is one which we could live without.”

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Rising costs dominate Budget debate (25 Feb 08)

February 26, 2008 by · Leave a Comment
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Rising costs and their impact on people’s ability to make ends meet dominated the start of this year’s Parliament debate on the government’s Budget.

Many of the 19 MPs who spoke during the five-hour session praised the Budget for being forward-looking and generous, but 13 also voiced concern at a slew of recent price hikes.

MPs also said businesses have been hard hit by steep hikes in office rents, and asked for tax reliefs to help them cope.

Mr Inderjit Singh (Ang Mo Kio GRC), who chairs the Government Parliamentary Committee for Finance and Trade and Industry, urged a review of the government’s avowed strategy to grow the economy as fast as possible in good years. This had contributed to the current situation of over-heating and high prices, he said.

At the same time, MPs threw their support behind the Government’s five strategies to keep inflation in check. These include:

  • allowing a gradual appreciation of the Singapore dollar,
  • stepping up diversification of food sources so as to minimize the impact of spikes in the prices of imported food,
  • continued support of home ownership as a key pillar of society which include market subsidies provide for lower-income Singaporeans to own a home,
  • providing assistance directly to Singaporeans who face problems coping with the cost of living such as boosting the ComCare and MediCare funds, and
  • keeping the economy competitive such as through continual education and training, and attracting new investments, which will in turn create jobs and sustain good growth of incomes for the population.

In total, more than 60 MPs are due to debate the Budget from Monday to Wednesday, before Finance Minister Tharman Shanmugaratnam responds.

Budget 2008 highlights

February 25, 2008 by · 2 Comments
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  • Growth Dividends: $865 million worth of “Growth Dividends” will be given to adult Singaporeans, averaging $100 to $600 per person. NSmen and NSFs will also receive an extra $100 each.
  • Estate Duty: Estate duty is abolished.
  • Personal Income Taxes: No changes in personal income tax rates this year, but an income tax rebate of 20 percent, to be capped at $2,000, will be given to all resident taxpayers for year of assessment 2008.
  • Medisave Top-Ups: Medisave accounts of all those aged 51 and above will be topped up by up to $450. Those between 51 and 60 will get $150. Those aged 61 to 70 will get $250, $350 goes to people aged 71 to 75, and the full $450 for those over 76.
  • Public Assistance: Public assistance (PA) for single-person households is set to go up from $290 to $330 a month.
  • CPF Life L-Bonuses: CPF members in the lower and middle-income group who are aged between 46 and 50 this year will get a bonus, called an L-bonus, of up to $4,000 in their CPF accounts when they enrol in the new national annuity plan, CPF Life. L-Bonuses will also go to members who are over 50 this year if they opt in. To get the L-Bonus, they must earn no more than $54,000 a year and live in property with an annual value of $11,000 or less, which includes all HDB flats.
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Some back-of-the-envelope CPF Life calculations

February 20, 2008 by · 7 Comments
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I have made some back-of-the-envelope CPF Life calculations.

This example is for a male participant who has $67,000 cash in his CPF Minimum Sum (assuming a total Minimum Sum of $134,000, of which half is property pledge, and half is cash savings).

These are my assumptions:

(1) The government makes a consistent rate of return of 5% on ALL of its funds under management. That is, the government is able to invest both the Retirement Account (RA) and Refundable Premium (RP) at an ROI of 5%. The return on the RP is NOT accrued to the CPF member’s account but instead held in government coffers. Only the return on the RA is accrued to the CPF member’s account and distributed to beneficiaries in the event of early demise, in which case, any investment return earned on the RP fund is kept by the government.

(2) Monthly income of $610 begins at age 65.

(3) The member chooses an LI payout age of 80.

The following table shows the balance amount in the member’s RA and RP account at each age from 55 to 90, the amount that the beneficiaries would get in the event of demise, as well as the amount of funds that the government holds in its coffers, assuming the government starts off by holding all the RP fund as well as any interest earned on the RP fund subsequently. I am also assuming that after the age of 80, the government starts paying off the member using the pooled RP fund while continuing to invest it at an ROI of 5%.

The member gets $7,320 per year, based on a monthly income of $610. As can be seen from the table, the RA fund has insufficient balance to pay the member by age 80. After age 80, there is no more RA fund, just one account from which the monthly income is drawn.

By the age of 80, the government is estimated to have as much as $54,452.59 in its coffers, based on an initial RP of $16,080.00. That is a HUGE profit for the government! Clearly if the CPF member passes away near the age of 80, the government stands to earn a LOT OF MONEY from the scheme! This is because the interest earned on RP fund is NOT given to the beneficiary but kept in the common pool upon the member’s death.

As can also be seen from the table, the amount of money that left outstanding in the member’s account rapidly diminishes after 80, so that by age 84, the beneficiary would get NOTHING in the event of demise of the member. However, the government coffers still have a lot of cash. There is enough cash in the government coffers to pay the member $610 per month. It is only after the age of 88 that the government starts losing money on the scheme (the negative balances are shown in red on the table).

National Lifelong Income Scheme (CPF Life) 1st Update

February 19, 2008 by · 5 Comments
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The National Lifelong Income Scheme, also known as the CPF Life scheme, has been finalized and will roll out in 2013. In the 1st update, I will provide a summary of the key features of the scheme, emphasizing key points that are potentially contentious. A formal critique of the scheme will be published in the 2nd update.

The CPF Life scheme is a marked change from the previous version announced in Parliament in 2007. In the previous version known as Longevity Insurance, CPF members will pay a certain premium upon attaining the age of 55, and in return receive a basic income from age 85 onwards when their CPF Minimum Sum has been depleted. However, the premiums paid will be forfeited in the event of early demise, that is, not returned to the family. The Editors of have noted that this amounts to daylight robbery, and results in the morally repugnant situation where wealth is transferred from the poor and ill who have shorter lifespans to the rich and healthy who have longer lifespans.

By contrast, the new and finalized scheme is more closely integrated with the Minimum Sum scheme and any remaining portion of the member’s Minimum Sum balance and premiums paid will be refunded to the beneficiaries. This is clearly more logical and acceptable. However the compulsory nature of the scheme is retained, together with the government’s right to vary the amount of premiums paid as well as the quantum of payouts later on, according to future changes in mortality rates and investment returns of the pooled premiums. This will be the biggest point of contention in the scheme, and will be my main focus in my subsequent critique of the scheme.

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Thinkall: Of State and Enterpises

February 18, 2008 by · Leave a Comment
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By Thinkall

18 Feb 08

There is governance, and there is governance and there is governance.

The beauty of relationship management lies in the most fundamental notion of layered thinking and focused understanding of the wherewithal lies in the application of those many levels of thinking and yet acting in a manner concerted and simple without the onus of conscience or tedium of lies.

There is the governance of meticulous precision that is good and not so bad if it could be fathom by those that must understand the application of change. A necessity that must be communicated and not taken for granted as being understood merely because the governor understands it.

This level of governance precludes crisis response that governor faces in his bad time and perhaps wrong decision made that requires his response which he cannot provide merely because he is not tasked nor enabled to understand where he went wrong.

Then there is the governance of imagination. How can the governor both in his capacity be meticulous and yet in the some perspective enlarge that capacity by his willingness to imagine the extent and causation of his actions and the possible responses. In this perspective our governors are totally inadequate. They do not in the slightest understand the current dilemma in this country: which is their making. They rather believe they have tried their best only to be treated in a manner most unequal or fair.

There is management of time, space and perception; however only the best manager that can imagine in the depth of time, space and perception, that must essentially include his total understanding of the notion of service to country, it is only possible if he serves beyond his own needs: something instinctive, however his intellect can do much to hold sway over those instinct.

That is principally the reason why the State must not own business due to not only an inherent conflict of interest but rather an inherent challenge to the most basic human instinct: to survive. Without State ownership of corporation, a good statesman need not have his instinct to serve challenged by his instinct to survive; however if he were to serve under a corporate state his instinct to serve will always be challenged myriad ways, even matters of compensation and status with subsidiary chiefs become issues.

A State is not a corporation; that must be the truth. A State cannot pursue the notion of profit not merely because it cannot but because it must not as his position of neutrality, of regulator and balancer are all challenged in one scoop!

A corporation pursues the goal of profit maximization and its officers compensation based on the most fundamental notion that their pursuits must be to maximize allocation of resources and if they were to break the law or even the notion of equanimity they must be held accountable.

Tragedy will ensue if the former is merged with the latter.

A tragedy is happening in this country, PAP will fall.