Tuesday, June 24, 2008 11:59
5 Minutes With… Tan Kin Lian on gambling
In Uncategorized • 621 views • 11 Comments
TOC spends 5 minutes with former CEO of NTUC Income, Mr Tan Kin Lian, and asks him for his views on this Straits Times report – “Gamblers spent estimated $4.2b on 4-D” – about how more S’poreans are turning to gambling.
TOC: Do you think Singaporeans are turning to gambling because of the record-high inflation rate we are experiencing?
Tan Kin Lian: I do not consider most people who buy 4D or Toto to be gamblers. Many of them enjoy the excitement of these games of chance and are willing to set aside a certain amount each month for this fun. If they bet within their means, the games should be considered as entertainment. They could have spent the same amount of money for a concert, show, travel or vacation. If they find 4D or Toto to be more fun, let them enjoy it.
However, I consider the people who bet on 4D or Toto with large sums beyond their means to be gamblers. They may have to borrow money for their bets, or deny their families of the money for their essential expenditures. This should be discouraged, although I do not know how.
Gambling is just one way of getting into financial difficulties. There are other ways of spending beyond one’s means, such as buying expensive clothes, jewelry and other luxuries. We need to address the issue of financial responsibility in a more holistic way.
TOC: In an earlier Straits Times report (see here), it was said that more low-income earners are gambling bigger sums. In your opinion, what do you think will be the consequences of this in the long term?
Tan Kin Lian: We need to educate the lower income people on the need to save for the future. Many of them do not have adequate savings. If they have to meet a medical bill or other unexpected expenses, they have to borrow and pay high rates of interest.
We have to provide the avenue for these lower income people to get a reasonable rate of return on their savings. The interest rate paid on bank deposits is too low. Other financial products offered by the financial institutions and life insurance companies have high front-end charges that give a negative return for most types of savings, if they are not kept for many years.
If attractive financial products are available, it will be easier to convince many people, including the low income earners, to save for the future.
TOC: With the govt’s repeated claims that it is already helping low-income Singaporeans – through cash handouts, vouchers, schemes like the WIS, and even raising the Public Assistance amount – why do Singaporeans still feel a need to gamble?
Tan Kin Lian: I hope that the recipients of the various help schemes use the money and vouchers to meet their food, healthcare and other essential expenditures, and not gamble the money away.
I hope that most people who buy 4D and Toto use money that they can afford to spare. Let them have their fun – they can look forward to the chance of winning a big prize.
There are a small percentage of people who are gambling addicts. They borrow money to gamble. They gamble away money that should be put to better use. I hope that this problem is not serious. They should be addressed separately.
TOC: The government has allowed almost every NTUC Fairprice supermarket to have a Singapore Pools or Turf Club outlet on its premises and these are mostly in the heartlands. Do you think this encourages Singaporeans to gamble?
Tan Kin Lian: In my view, these outlets provide a means of low cost entertainment for their customers. For most people, these games of chance are a way to enjoy life in Singapore. It is a useful distraction from the hard work that they have to put in every day.
If we wish to talk about the ills of gambling, we must not forget that larger sums of money are involved in gambling on the stock, currency, options, commodities and derivative markets. These so-called investors may not be aware about the risks, especially if they are involved in investing on margin accounts.
TOC: Are you worried or concerned that such easy access and availability to such betting outlets will, in the long term, inculcate gambling habits among our young, if they haven’t already?
Tan Kin Lian: I consider the risk of a gambling habit to be only part of a larger problem. We need to educate our young people about financial responsibility – to spend within their means and to avoid incurring debts that attract high rates of interest.
They are so many ways of getting into financial trouble. The most common appears to be over-spending on luxurious purchases that they cannot afford or do not need. The easy credit terms, with high hidden rates of interest and other financial charges, appear to be more risky for the young people.
At least the stakes and rules for 4D and Toto are more transparent, fair and regulated. Many financial products offer a poorer deal to the consumers, but are approved as “investment products”.
TOC: According to the Straits Times report, 4-D taking “were up more than 10 per cent from the 2004/05 financial year ($906 million.)” What do you think the govt should do with the revenue collected from this?
Tan Kin Lian: The government revenue from these games of chance is already put to good use in supporting many community projects.
We should be asking about the use of the larger amounts of government revenue from ERP, GST, foreign workers levies and other taxes. Anyway, this is the job of the Minister for Finance and should be left to him to deal with these matters.
TOC: Finally, is this a sign that when the two IRs (casinos) open for business, the situation will worsen?
Tan Kin Lian: There are already many ways for reckless people to get into financial ruin, including the stock market, foreign market, hedge funds, turf club, cruise ships, internet betting and casinos in overseas countries. The budget airlines make it quite easy to visit these offshore casinos.
The opening of the integrated resorts (i.e. casinos) in Singapore will not make a significant difference to the supply of gambling, which is already plentiful. I hope that the integrated resorts will really have the positive impact of improving the entertainment facilities in Singapore.
——————–
Read also:
5 Minutes With… Leong Sze Hian on NTUC discounts.
5 Minutes With… Leong Sze Hian on the budget.
5 Minutes With… Leong Sze Hian on rising inflation.
5 Minutes With… Choo Zheng Xi on PM Lee’s interview.
——————–
Related posts:
11 Comments
Tan Kin Lian
nhyone
I don’t agree that people buy Toto and 4D for fun. They are buying hope.
If you buy, there is hope (however slim, but there is still hope).
If you don’t buy, there is totally no chance of winning.
Still, the odds are heavily stacked against the gambler.
James
Gambling in its very essence is a high risk bet because there is little basis and the odds against winning are high. Persisting only makes it worse. As often said, casinos are the house and the house always winds.
In contrast, investing or speculation (in the literal sense of observation, study and making low risk bet) would be something people should be encouraged to go into. This would be a little bit like forecasting.
Of course, this does not have to involve $$$ technically speaking. Playing a good game of mahjong or bridge etc w/o risky monetary exposure.
James
To be more accurate, gambling e.g. walking into a casino can only mean that one has no idea of how a game has been played in the sense of price history. There is no way for it to happen i.e. no price data history, from which to speculate. So there is no chance for homework, no thinking allowed beforehand. The person is being led or misled, depending on the situation and the environment.
Tan Kin Lian
The low income people are being exploited by businesses. They have to pay a higher price and are given a lower level of service. They have to pay high interest rate on loans.
They cannot afford the expensive ways of enjoying life, such as going on holidays or lavish parties.
So, they find their enjoyment in 4D and Toto. It can be hope, but it is also excitement and fun.
It can also be fun to save for the future, if the saver is able to get a good rate of interest and a good deal. Unfortunately, interest rate is too low and the charges by the bank and insurance companies are too high.
PC
Everyone has their own defination on grambling, investment etc. One has to educate themself on the limits. Like never put all eggs in one basket.. Grambling is just pure luck. Event there is 0.001 % does not mena you will get it. Investment also has different level of risk.
lim
I think gambling (like investment) is a personal choice. If one is dumb/weak enough to gamble away his/her money, then that person doesn’t really deserve that money.
L
eh Lim,
life is also a gambling everyday leh. When u make a decision to cross a road, or decide to swallow food down your throat, you are taking a risk of being knocked down or choke to death.
Thats means, if you are dumb/weak enough to gamble away your life, then you dont really deserve life? Haha…
Please la, its the choice of the people. Who are you to say that….
lim
L, you have understood my point exactly.
Even in life, the decision to cheong esp when the traffic light is red is a gamble. Recently a 16 year old kid got knocked down by an IRAS officer just for making this decision and lost his life for it. I call it dumb (but doesn’t mean I’m not sympathetic).
On the question of “deserve”, I was talking about money. You may equate that with life but I don’t. Money is not equal to life. Even in human rights, everyone has a right to life but not to money.
For myself, I would prefer to look around first at a traffic crossing, get into that habit of doing that so that it becomes instinctive rather than saving a few seconds.
Ultimately, it is a personal decision which is what I’m trying to say.
Tan Kin Lian
According to the definition from Wikipedia, any game of chance with the hope of making money is a “gamble”. So, 4D and Toto are considered as “gambling”.
In our society, “gambling” is considered to be bad, and should be avoided.
I wish to state that “gambling” in a small way, is actually fun and entertainment. It is only when “gambling” is done in a big way, using borrowed money or taking away money that should be spent to feed a family, that “gambling” becomes bad.
We can either change the definition of gambling, or change the perception that all types of gambling is bad.
Here is a definition of gambling in Wikipedia.
Gambling has a specific economic definition, referring to wagering money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods. Typically, the outcome of the wager is evident within a short period of time.
The term gaming in this context typically refers to instances in which the activity has been specifically permitted by law. The two words are not mutually exclusive; i.e., a “gaming” company offers (legal) “gambling” activities to the public. (This distinction is not universally observed in the English-speaking world, however. For instance, in the UK, the regulator of gambling activities is called the Gambling Commission (not the Gaming Commission.)