By Leong Sze Hian
I refer to the reports “MM Lee warns of dangers of slow growth if productivity does not increase” (CNA, Feb 18) and “S’pore income gap narrows” (ST Breaking News, Feb 19).
The former article reported MM Lee as stating that “The island state has a growing economy, increasing real incomes, better homes which are rising in value, and citizens are generally better off”.
Well, the next day, we had the news that the economy contracted and nominal and real incomes shrank.
According to an Occasional Paper released by the Singapore Department of Statistics (DOS) on February 19, under the section “Key Household Income Trends, 2009”, household income from work declined in 2009. The decline in household income from work reflected the weaker labour market conditions in 2009, which saw higher unemployment and lower wages.
It was further stated that “Median monthly household income from work among all resident households declined by 1.9 per cent from $4,950 in 2008 to $4,850 in 2009. After adjusting for consumer price inflation in 2009, median household income from work saw a decline of 2.5 per cent”.
On the same day (Feb 19), the DOS released a report on the Performance of the Singapore Economy for 2009, which said that “Singapore’s economy contracted by 2.8% on a quarter-on-quarter, seasonally adjusted basis, in 4Q2009″, and that “the economy contracted by 2.0% in 2009”.
So, were we in a way overly optimistic when “Singapore declared the recession (was) over in November last year”, according to the CNA article “Singapore economy to grow up to 6.5% this year: govt” dated 19 Feb?
It was announced by the press that “in the past few months, the government has taken further steps to widen the differentiation between citizens and Permanent Residents and to slow down the inflow of foreigners”.
Furthermore, on the same day (Feb 19), it was also announced that Polytechnic and Institute of Technical Education (ITE) fees will be increased from April. The press reported that “The Government decided to keep fees at the status quo last year because of the economic recession but this year, as the economy turns, it is timely to raise the fees” (“Fees for poly and ITE students going up in April”, ST, Feb 19).
If we really want to widen the distinction between Singaporeans and permanent residents (PRs) and foreigners, why can’t we just raise fees for PRs and foreigners, instead of raising fees for Singaporeans too?
Since we want to take on the “challenges such as increasing productivity and raising skills across the board” and the government has acknowledged that “every worker also has to be re-skilled, re-trained and re-educated to achieve higher standards of capabilities”, why are we raising vocational education fees so soon before wage cuts are restored?
In this connection, another example is the reduction of the subsidy by five per cent for PRs in Class C wards in hospitals from next year, and by another five per cent the following year.
Actually, a five and 10 per cent reduction in subsidy from the current 70 per cent subsidy, translates to a 16.7 and 33.3 per cent increase in medical fees, respectively.
With regards to the assertion that “we always give preference to our own citizens”, with the total increase at 100 per cent, from the former 80 per cent subsidy to 60 per cent eventually, many Singaporeans may bear the brunt of the increase if they have PR or foreign spouses, dependents or employees.
So, why not increase medical fees for PRs and foreigners, but reduce fees for Singaporeans instead of maintaining the status quo?
So, incomes are down, GDP has contracted in the last quarter, but fees are going up.
Let’s hope that other fees and costs will also not start to go up, citing the reason that the economy is recovering.
Those who may suffer the most when costs go up and incomes go down may be the poor.
On the same issue, there have been media reports that charities need more donations.
For example, the National Kidney Foundation (NKF) had a budget deficit of $0.9 million, its biggest shortfall in 10 years, for the 2008/2009 financial year ended in June (“NKF to dip into reserves of $270m: Charity hit by economic downturn and drop in donations”, ST, Nov 29, 2009).
According to its annual report for 2007/2008, the surplus was $9 million, and the surplus for 2006/2007 was $19 million.
Does this mean that the 2007/2008 net surplus of $9 million alone, not counting the 2006/2007 surplus of about $19 million, may be enough to cover about ten times or ten years of the current year’s $0.9 million deficit?
There has been a significant reduction in investment income from $11.6 million in 2006/2007 to $3.2 million in 2007/2008, and to just $80,000 now.
What has NKF been investing in such that its investment income can fall from $11.6 million to $80,000, a drop of more than 99 per cent in two years?
NKF has $270 million of reserves now, compared to $262.8 million in December 2005.
When the NKF saga broke in 2005, one of the issues which riled Singaporeans was that it had some 30 years or so of reserves instead of the three years that the public was led to believe.
Its 2007/2008 report states that “After adjusting for inflation, the existing surplus fund is expected to last for only seven years”.
Now, it says that its current reserves of $270 million can only last for five years or so.
I am somewhat puzzled by the figures — if $262.8 million in 2005 was deemed to be about 30 years of reserves, why is it that $247 million in June 2008 was expected to last for only seven years, and now $270 million for just five years, despite cost-cutting measures like giving cubicles instead of rooms to managers?
How does the NKF fare in the light of the new guidelines for charities on the accumulation of reserves?
Despite the current year’s $0.9 million budget deficit, is NKF still the largest charity with the most reserves, and the most number of years of reserves?
Finally, with regards to the statement “Without growth, Singapore will not be what it is and the key to our growth is a government taking right decisions and labour unions, employers, and the government working together. No other country in the world has got this combination”, let the following statistics speak for themselves:
- There are 24,000 needy residents in just one CDC — North East Community Development Council. How many needy in total in Singapore?
- Singapore’s workers continue to lead the pack when it comes to the number of hours they put in at work, according to a report by the International Labor Organization (ILO). The report puts them at the top of 13 economies in the group’s Global Wages Report for 2008-09, surpassing even the notoriously hardworking Japanese and Taiwanese.
- Only 60 per cent are projected to have at least $67,000 in their CPF in 2013, according to a CNA report.
- 60,000 flat dwellers were given financial counseling by the HDB as a result of having difficulty in paying for their flats in 2008, and 30,770 flat-owners were in arrears over three months as of September 2009.
- According to the Department of Statistics’ Household Expenditure Survey released in December, the Average Monthly Household Income by Income Quintile for 2008, was $1,274 and $3,476 for the 1st–20th and 21st–40th quintiles respectively.
- 105,965 households earn below $1,000.
- 116,092 households earn $1,000 – $1,999
- Yhe bottom 20% of households’ monthly income declined by minus 1,4 per cent per annum in real terms from 1998 to 2008, and the 21st to 40th quintile of households’ income increased by only 0.9 per cent (2.3 per cent increase less 1.4 per cent inflation) in real terms.
- The unemployment rate for cleaners, labourers and related workers was the highest across all sectors in June 2009 at 8.3 percent, according to the MOM’s Workforce 2009 report released last year.
- Part-timers’ median income in 1999 was $600. The increase for the last 10 years was only $20, or an annual increase of only 0.3 per cent, without adjusting for inflation. And it is important to consider that a possible reason for the $20 increase may be that a part-timer is now defined as one working 35 hours or less, instead of 30 hours.
- 401,600 resident workers earned less than $1,200 a month as of June 2009.
- The number of children applying for the Straits Times Pocket Money Fund reaching an all-time high of 11,642.
- For the poorest 20% of households, their Expenditure at $1,760 in 2008, was 38% more than their Income of $1,274.
- Singapore was ranked very high at No. 10 in Mercer’s 2009 Cost of Living Survey.
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Headline picture from quachee’s blog.
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- Medisave contribution may increase to cover costs – Leong Sze Hian replies
Dear Mr Leong
A very good article. But, as i can see only good to read. Beacause many sg i spoken to “Bochap”.
In order to change you need everybody effort to pass the message. I hope it’s not just good reading.
The reason why people in SG generally ‘bochap’ is because by and large, they are either just making ends meet, trying to achieve their dream goals, or are living hand-to-mouth under his administration.
People are FEARFUL of trouble should they voice their objections publicly, or otherwise appear too VOCALLY objectional towards his governance & psycho techniques.
Their eradication can only be done by THEMSELVES, via their infamous policies bringing about their predicament.
TERRIBLE situation -
Thank you Mr Leong.
oh oh oh the sky is falling help!
Enlightening article.
What is the most practical way to improve the situation?
Oil prices has dropped drastically…I have yet to see prices and cost adjusted down accordingly…
But when Oil goes up, you can be sure it the one significant excuse for things to go way up just as quickly.
@Dane
The pracitcal way is we need a good people in the government to see transparency, accountability and to questions , to improve , to check. So more opposition to be voted in. No government official and political family members should be involved in business that is state own. Give sg individuals to innovative, with gov help.
It’s just go to prove that the donkeys up there are simply clueless about what’s going on in our economy, and talk about trying to be the “forecast extraordinaire” ? Haha ! my toes just laughed.
Any frantically trying to recoup their massive BILLIONs loss via hasty decisions to increase fees at all fronts ? C’mon, who are you trying to fool ?
The LEEs have been busy bragging about Singapore’s economic recovery lately while the pressing issues of disproportionate unemployment, disengaged Singaporeans and PAP policy failures are shielded from the medias. As usual, creative illusions and false feel good factors are preached through the ST. These are mere election drummings by the LEEs, especially the MeaninglessMentorLee for his anointed ProgrammedMentoredLee. Add in the compulsive gambler, Holocaust Crab, and majority of Singaporeans will have to live with scraps for their remaining lives.
Time to increase the ministers’ pay too.
Thks Mr Leong.
I think the cabinet should set up a think tank and figure out a way to lower personal income taxes further – my fear is this – HK seems to be able accomplish this in a very productive manner – so the moral of the story is this: productivity as an idea can work both ways – just as govt can suggest workers to be highly productive.
Govt’s themselves should from time to time also ask themselves the same question, “how productive are we as the world’s highest paid outfit? Are we productive in delivering value to tax payers (citizens & residents)? Are we productive in growing our wealth for example in state owned enterprises such as GIC & Temasek?
One thing is for sure, it cannot be a one way street.
SD
wah! laulee talkin in his personal capacity as emperor of singapoor har
with his monthLEE earnins of more than $100,000 if he is not properin who is?
except ohthamptui and peacemaker not forgettin preston loo as well…
the newly opened IR rsw resort already claimed a few victims from petty theives to forgerires of faked IDs…
soon the sentosa polis post is goin to be flooded better get a few more tugboats for the polis coastguards as well..
naibei..
talk cork shake mapars even better
MM lost his mind or out of touch or both.
http://www.channelnewsasia.com/stories/singaporelocalnews/view/1038320/1/.html
“Let me tell you what happens when we slow down too much. You get the reverse spiral. Low growth, maybe even zero growth. Last year we had minus two per cent. Prices go down, property prices go down, incomes go down, you can’t refurbish your houses, no new SERS, no upgrading and
the country goes down.”
Did property prices go down last year, Mr Lee?
Is that what he thinks we only think about?
That we can’t refurbish our house or no upgrading?
Anyone knows when the government publish the average/median monthly income, is it the (annual income, including bonus)/12 OR strictly thr income at end of every month ?
Easy to exhort and does not lead. More good years, without PAP
I am amazed he used labor force for the construction of IR to justify the influx of workers. How about using the influx of White Collar Workers to justify the need for them?
singaporeans cannot do the job?
With so many FT and PRs in white collar jobs, why is our productivity not improved to the extent needed?
Pls answer.
If productivity is a formula with output divided by number of people; you can have 1000 very hardworking workers working round the clock (highly productive bunch) plucking the roots of bean sprouts producing a whopping $10,000 of output a day. Or a bunch of 1000 “lazy-champion grumblers-spur not in hide” workers producing 10,000 apple ipods (each worker is so lazy that he can only make 10 ipods a day-tsk tsk tsk) but the output is a whopping $2million a day (assuming $200 per ipod).
Singapore’s problem is not that the workers are not productive! It is one where our output is not of higher value and not scalable. When we move more into the service sector; the output is not highly scalable and you need a lot more workers to produce the same output.
Isn’t this what happened in Singapore?
# Ranked 70th in Quality of Life , Feb 20, 2010 12:48 – “I am amazed he used labor force for the construction of IR to justify the influx of workers.”
Yes, agree. Being in the construction industry, I can honestly say that construction of these 2 IRs is just a smoke screen to justify massive influx of foreigners. The way old fart is saying is like these 2 IRs are so important that we need to utilise all our resources, including foreigners to construct them. That’s nonsense. IR forms only a fraction of our multi-billion dollars construction industry, let alone an even more minute contribution to the overall economy. Old fart has obviously ran out of justification for his failed policies and resorting to whatever excuses he can find to smoke screen us. Tsk tsk tsk…this time he’s not going to get away with it.
I’m tired of playing this game. Let’s get it over with. Get them out of the house and put everything back in order. We’ll show how productive we can be, when we know the leaders we’ve put in place are of from our own vote. Not by the back door. We will work hard if we know we are working for our future not theirs. Please Singaporeans, for your own sake do what you know is right.
The editors at ST ought to be kicked in the nuts for reporting the complete opposite!!!
This is yet another example of lousy journalism….controlled/muzzled press. You can bet your last dollar that ST will subtly promote Prostitutes And Pimps during the election “cooling off” day.
MSM journalists WILL get into big “trouble” if they publish stuff that undermine the kingdom. This is a FACT. So to earn their pittance, they have to publish whatever is “approved”. Know your true enemy.
‘recession over’ ?
then when is the next recession?
Can know when it ends but can you know when it comes again? next year? year end?
better have election asap because future is unknown. next recession is unknown.
but crystal ballers may see things in their balls.
How can productivity be increased if more and more Singaporeans are lured to the two casinos, skipping work and taking MCs. When they lost millions, they have less to spend at the neighbourhood shops and shopping centres causing more Singaporean to suffer. Casinos are owned by foreigners, so our money are drained out to the foreigners. So they the foreigners and the governments are the winners, Singaporeans are the sucker losers.
Everyone has misunderstood MM Lee.
Did he not say in a previous speech that his job is to forecast?
Is this line “The island state has a growing economy, increasing real incomes, better homes which are rising in value, and citizens are generally better off”.” about the time frame now? Because if it is so then we are paying millions of taxpayer dollars for insane batshit which cannot be the case since MM Lee is so talented.
The only conclusion is that from now to infinity, somewhere along the line what MM Lee says will come true.
Also i would like to offer a solution to our ills. Enrich the already rich so that the poorest citizens can have a better. I think the govt is practising this already so we can expect to upturn the downturn very soon.
See here : http://politicalirony.com/2010/02/16/solving-class-warfare/?
as long as the ruling party is out of govt then singapore will have no problem even during reccession period. Imagine how much money we have in our nation reserve? Oops! hopefully the money is still there . . .
in the looooong run, if you keep giving me money to invest, i can promise great returns where time is any time alooong the loooong time axis. my bank account is 1223940202. Feel free to dump your money into it. great returns. i promise. in the loooooong run.
Let us not donate a single cent to any charity at all.
Let the poor stew in hardship, if spurs have not been struck hard enough in their hides — courtesy of PAP.
However if you feel your survival is threatened by so many foreigners, vote Protest and vote out PAP.
Send a message, change the history, and tomorrow will be better for all.
He is the greatest prophet of all times who can predict anything shortest one-year time frame or anything in 20 to 30 years time when he is non-existence. Anything in between he is not sure because if he predict wrong he going to loose a lot face and also blemish the Singapore brand name.
I can also predict the two casinos is going to reduce our workers productivity cos they need to skip work and take MCs to patronise the casinos. When these workers lost millions of dollars, they got no money to spend at neighbourhood shops and shopping centres, so more people and more family suffers. There will be downward spiral for all these small business. Only the foreigners (casinos owners & workers) and government (more taxes and entrance levies) are the winners. We Singaporeans are the great losers.
#tiredsingaporean
Actual money are not there anymore, just rough papers everywhere around the globe. Thats why they need to raise money through issuing bonds lately.
Those who still cannot make up their minds should think about this question.
After the coming election results is announced, what is gonna come our way in the next 5 years in terms of :
1.Job security : no money no talk. no money no honey.
2 Cost of living : what fees will or can be hiked? what fares or tarriffs can be hiked ?
3. Min Sum : how can it change? Technically, can it change and change?
4. Who will voice up for you ?
5. How many new citizens will there be in the next 5 years?
6. How many new PRs will there be in the next 5 years?
7. How many new FW will there be in the next 5 years?
8. How many new FTs will there be in the next 5 years?
9. How much more over priced will flats be thanks to cash rich foreigners if not PRs etc?
How will you retire? 1st that guy needs to retire indefinitely.
//Justforlaughs
why can’t you produce “Ipods”?
How come the other tigers can do it?
Do they need to steal sand?
These city to city cost of living comparisons are misleading. Singapore is not a city, it’s a country. If you are Japanese, and you find the cost of living in Tokyo too high, you can always go to Okinawa to retire, where it’s cheaper. Or Kyoto, or ….any of a number of cities. You are entitled to move to the Japanese city of your choice. You don’t have to emigrate internationally, you don’t have to satisfy anyone that you are a worthy immigrant, you don’t have to beg immigration officials of a foreign country or pledge allegiance to it.
If you are a Singaporean and you find the cost of living here too high, well you just live with it. If you live in Bedok, retiring in Ang Mo Kio isn’t going to mean any significant reduction in your cost of living. You’re stuck.
So we need to compare Singapore’s cost of living with the cost of living of other countries, not cities. I suspect that makes Singapore the most expensive country in the world. Aren’t there any studies that address this?
Rovk made very intelligent observations.
If more singaporeans become or think like him, i must admit, i would believe that singapore will Change.
But then,very few people think from a national perspective. People seem to think from a Self perspective. As long as people themselves are not affected by work or cost of living, they will not bother to care how those affected feels. I think this is human nature in a way.
its always, self self self. What’s mine is mine and what’s yours should also be mine mentality.
how many actually care about the society at large?
Looking back; Slow Growth, High Growth… what’s the difference?
People still slog to cope with Costs of Living! Times are bad, increase this and that, times are bad, also increase this or that. So where is the DIFF???
I believe the rich & of course the government will feel the differences.
mon Feb 20, 2010 19:10
We used to produce “ipods” but as our costs of business increased tremendously and China has become the undisputed manufacturer of the world. Without strong local high value product brands and a manufacturing sector that is highly dependant on foreign companies’ presence who then moved out to China, it is unavoidable that our manufacturing sector was significantly erroded, that is why the Govt had to open Casinos to fill the GDP void left by the manufacturing sector and promote service sectors.
I do not have the answers as a commoner who loves my country. However I think it is wrong for the Govt to bash the people who happens to be the world’s most hardworking workers with words like lazy and “spurs-not-in-hide” when the Govt knew that they were the ones who could not keep the high value scalable production resulting in lower productivity.
Service line in the case of Singapore is not scalable, period. Do not blame the people.
[i]when the Govt knew that they were the ones who could not keep the high value scalable production[/i]
why did it happenned? how did it happenned?
asked simwonghoo..he will give you his answers…
NUTs is the keywords..NoUTurns…
1st of all our arrogant overpaid ministers think so highLEE of themselves when they were the ONEs who RAISED productions/manufacturin cost from rentals to logicstics includin a hefty foreign levies..henceforth the words is foreign talents…
any logical simple businessman would asked…
why should i produced my goods in singapoor when i could hav done the same(maybe a little lower rougher workmanships) but @ 1/3 of the costin? i asked the very same Q here few months ago..can you buy the world cheapest wired 2pin/3pin multiac adapter @ $1..yes 1 singapoor dollar from a $1 store? in singapoor.. i have to pay for the same product @ $7 onwards…in a $1 singapoor shop…
“If we really want to widen the distinction between Singaporeans and permanent residents (PRs) and foreigners, why can’t we just raise fees for PRs and foreigners, instead of raising fees for Singaporeans too?”
How about fees are lowered for citizens but stay the same for PRs and foreigners? That way no one lose… Hold on, I understand now… Singaporeans prefer to lose if foreigners lose even more… Smart?
they need to show a healthy balance sheet before election.
and that idiot Loong keep asking why Chinese are not reproducing, having kids. Make Education free for singapore citizens up to Poly and ITE level – same as our JC students. Then you will see more kids being produced. Either that or put more money into the Psst Sec Education account of all Singapore students to cover that $2000 per year for 3 years……If the Children of Singapore is important, this Govt must put the money where the mouth is. If not, I see spiralling fees, eg Poly engineering course increasing and more Singaporeans not reproducing.
Whenever PAP wants to increase fees, they cite recession is over, economy is recovering. Whenever they want to depress workers’s pay, they cite recession as reason and Singapore has lost its productivity. All can be reported within a few days, contradicting their stands, in order to justify their policies. So which should we believe now? Singapore economy not picking up or is recession over? It is time we bring in a more productive alternative parties to serve us than having a clueless PAP playing with words and fixing statistics at whims and fancies.
If the fees for Singaporeans are not increased a little and the fees for PRs are increased, the PRs may be more unhappy. We must not forget about the contributions of PRs and foreigners???
Of course how much we value the contribution of Singaporeans in National Service is an issue. Are the differences in the treatment of PRs and Citizens sufficient to balance the NS contribution?? After we are so used to preaching there is no free lunch.
When Singaporeans not producing enough, the demand for education is less right?
But how come education costs keep increasing?
Demand and Supply theory wrong again? in Singapore?
If local educations are not considered as talent, why bother to increase fee? Ultimately foreigners who earned their degree or diploma overseas seem quite well sought after by PAP.
Recession is over or not is not as important as whether the People’s income general has it made Progress or not and whether the Quality of Life and Cost of Living has improved and thus progressed or not.
These are to me the main KPIs we should focus on.
Recession over can still mean in the Trough for extended inknown periods of time.
The next Financial crisis is , as Always, an Unknown Unknown.
Who can guarantee and say what the next 5 years is gonna be like? I like to see if there is such a person and ask him his basis for his claims.
Is it an Aspiration or is it a Guess or a Guarantee?
“MM Lee warns of dangers of slow growth if productivity does not increase” (CNA, Feb 18)
Productivity = Higher Output at lesser cost. Was MM talking to himself and his cronies when he said the above?