TR EMERITUS

Written by Our Correspondent When grilled by fellow PAP MP Inderjit Singh last week in Parliament on the increasing number of PRs and new citizens contributing to escalating HDB flat prices, National Development Minister Mah Bow Tan who admitted not too long ago that he was "caught off guard" by the record high resale flat prices had only this to say: "PRs make up only one in five resale flat buyers and have minimal impact on resale prices.” Mr Mah can be forgiven for not knowing the reality on the ground since he doesn't live in a HDB flat. Flyers from property agents offering obscenely high COVs for resale flats on the behalf of PRs and new citizens are becoming ubiquitous in the HDB heartland. Last Saturday, we reported the case of a Taiwanese PR offering $50,000 COV for a resale flat. Now, we have a "group" of PRs and new citizens offering the same COV for flats in another estate: [Source: Vote PAP out Facebook] Netizen Jansen Lim wrote that such advertisements are found all over his block: "This kinda of adverts are all over my block as well. It's almost impossible for normal Singaporean like me to afford a resale flat. Leaving me with no choice but to ballot for BTO, which takes 5 bloody years to complete." Jeremy Lee concurred: "Recently I asked agent how much the average COV for Clementi flats near MRT. He said $40,000. I asked any problem selling my flat at Bt Batok. He said no problem, demand is strong from foreigners. :D" The prices of resale flats grew by 8.2 percent in 2009 with the median COVs doubling from $12,000 to $24,000 in the last quarter alone. The sky-rocketing prices are caused largely by the failure of the PAP to plan well ahead and to anticipate potential problems along the way. In 2003, Prime Minister Lee Hsien Loong announced his ambitious plan to increase Singapore's population to 6.5 million people by 2030. All of sudden, the floodgates were flung open to foreigners from all over the world. However, the infrastructure, including public housing, is not beefed up to meet the increased demand from a rising population. Recent launches of BTO flats are more than 5 to 10 times subscribed even in less popular areas like Choa Chua Kang, an indication of how serious the housing shortage has become. Only slightly more than 11,000 new flats were built between the years 2006 – 2008 when there were over 90,000 PRs and 20,000 new citizens alone in 2008: [Source: HDB Financial Report 2008/2009] Below is a graph illustrating how the rise in the prices of resale flats coincides with the rise in the number of foreigners in Singapore between the years 2000 and 2008, courtesy of Kojakbt, the moderator of 3in1kopitiam: Due to the ruling party’s liberal immigration policy, foreigners now made up 36 per cent of Singapore’s population, up from 14 per cent in 1990. The prices of HDB flats are kept artificially high by building less flats than needed to meet the demand and increasing the population via immigration. As a result, Singaporeans are the ones who suffer in the end as they will have to shoulder more and more financial burden to pay for these over-priced 99-year leasehold public housing. Mr Mah appeared to be oblivious to the plight of Singaporeans. Despite evidence on the otherwise, he continues to insist that HDB flats are "affordable" to the majority of Singaporeans. Since it is "not realistic" to expect Mr Mah to make public housing more affordable, perhaps Singaporeans should consider getting a new man for his job in the next general election.   Related articles: >> Taiwanese PR offers $50k COV for resale flat >> Mah Bow Tan: PRs have minimal impact on resale flat prices >> No empirical evidence to suggest that public housing is affordable in Singapore >> When will Singapore’s property bubble burst? >> Why HDB is unable to reveal break down costs of new flats now >> HDB to consider introducing rules to curb property speculation >> HDB blames Singaporeans for not selecting flats when given the chance >> Singaporeans worried about retirement after depleting CPF to pay for over-priced HDB flats >> Mah Bow Tan acknowledged that rising HDB flat prices has sparked “fresh concerns” >> PM Lee: Govt does not have control over prices of resale flats” >> COVs of resale flats shooting through the roof >> HDB resale price index hit record high in 2009 >> Singaporean wants PRs to live in rented flats instead of buying resale flats >> Singaporeans wants PRs to be banned from selling HDB flats at a profit >> Shanmugam: Singaporeans likely culprits for driving up HDB flat prices >> Mah Bow Tan: HDB flats remain affordable >> Means testing for PRs to buy resale flats >> Immigration and public housing: should the govt or people plan ahead? >> Grace Fu: hard to predict demand for housing >> Indonesian PR bought 4-room flat at $653,000 >> Mah Bow Tan asks home buyers to be realistic >> PAP MP blames young couples who cannot get a flat for not planning ahead >> Home affordability: HDB versus the public >> Demand vs supply: so many applicants, so few flats >> Number of applicants exceed number of flats >> HDB to increase supply of flats >> Mah: don’t compare with prices in the past >> ERA: 40 per cent of HDB flat buyers are PRs  Read More →

By Edmund Khor In the recent Budget speech 2010, the Finance Minister Tharman Shanmugaratnam claimed that the lax foreign workers policy had reduced unemployment and raised wages for Singaporeans. He said the huge influx of foreign workers had enabled the median income per household member to rise significantly for the four years from 2005 to 2008. Median income grew by 20%, adjusted for inflation. Minister Tharman added that lower income households also saw their incomes rise which took place over the three years from 2006 to 2008 – when their incomes grew by about 16% in real terms. They ended with total growth of incomes of about 7% in real terms over the 10 year period from 2000 to 2009.  Based on the simple observation that “the three years from 2006 to 2008 in which wages showed healthy growth for our lower income families corresponded to the period when the foreign workforce was growing most rapidly”, the Finance Minister claimed that the foreign workers policy had raised wages for Singaporeans. This brings to mind the Progress Report of the Ministerial Committee on Low Wage Workers released in June 2009. In that report, the high-level committee claimed that low wage workers have seen increase in their wages. It suggested that monthly wage for the 20th percentile employed resident had seen a 9.2% increase in monthly wage from $1,200 in 2006 to $1,310 in 2008. However, the claim was soundly debunked by netcitizens[1]. The reported monthly wages were in nominal terms, i.e. they were not adjusted for increases in the prices of goods and services over the two year period. Using the inflation rate of 9.5% experienced by the lowest 20% income group, low wage workers were in fact worse off in real income terms. One cannot help but notice the two different statistics used in measuring the income of Singaporean workers in the two government reports. It is most puzzling why the Finance Minister chose to use average income per (working and non-working) household member as a proxy for wages for working Singaporeans when there are far more appropriate statistical data available. Even if we were to choose to give Minister Tharman the benefit of the doubt, the statistics used could not convince that there is definite rise in the living standards of the median Singaporean citizen. Two points were aptly provided by the Reform Party in its Response to the Singapore Budget, 2010[2]. Firstly, the definition of residents includes PRs and not just citizens though the minister talked about Singaporean households. Over the past decade the resident population grew by 15% while the resident labour force grew by approximately 25%. This was undoubtedly due to the surge in new citizens and PRs as a result of the government’s liberal immigration policies. The majority of these new residents did not have dependents (hence the much faster rise in the resident labour force than the resident population) and all of them would have had jobs so the proportion of working adults in the average resident household would have risen. As a result we would have seen an increase in real median income per household member without any real increase in the median incomes of Singaporean citizens. Secondly, the Minister’s figure excludes households consisting solely of non-working persons over 60. If their incomes fell during this period or their numbers increased as a proportion of total households), due not only to the aging population but also because of the diminished employment opportunities for senior citizens as a result of the government’s open-door foreign worker policy, then excluding this group would distort the figure for median income per household member and make it look better than it really is. Finally, Correlation does not imply causation. It is spurious to suggest the high growth in foreign labour force increased the wages of Singaporeans simply from the correlation between the two variables. As we know, our exported-orientated economy is highly leveraged to the global economic environment.  The exogenous factor we all know is the higher external demand which resulted in increased demand for labour resources in the Singapore economy. Wage increases would have been higher had it not for the lax foreign labour policy which capped the wages of lower-end and middle-level Singaporean workers. In the progress report of the Ministerial Committee on Low Wage Workers mentioned earlier, it glaringly failed to take into account the impact inflation on nominal earnings. This and the inappropriate statistics used in the Budget speech call into some serious questions on the misleading use of government statistics, which may misrepresent the situation on the ground to Singaporeans. The Chief Statistician and the Singapore Department of Statistics, as our national statistical authority, must be allowed to adhere to their professional ethics and to voice out against any misrepresentation from the inappropriate use of statistical data by government leaders for political gains. This will prevent further undermine in the confidence of Singaporeans in our government statistical data. -------------------------------------------------------------------------------- [1] see https://www.tremeritus.net/2009/06/10/are-the-low-wage-workers-really-better-off/   [2] See http://www.thereformparty.net/index.php?option=com_content&view=article&id=71%3Areform-party-response-to-the-singapore-budget-2010&catid=11%3Aperspectives&Itemid=44&lang=en   Other articles by Edmund Khor: 1. Are low wage workers really better off? 2. Temasek outperforms?  Read More →

By MJ [email protected] After the commendable result against Chinese Super League side Henan Jianye away from home on Match Day 1, SAFFC approached tonight’s AFC Champions League Group G clash against South Korean giants Suwon Samsung Bluewings at the Jalan Besar Stadium with guarded confidence. The Suwon squad was superior on paper in every department, featuring a host of current South Korean international players in their line-up. In the corresponding match last season, Suwon won the match 2-0 despite resting several of their regular first team players. SAFFC started the match brightly, pressurizing their opponents and chased for every ball, keeping them pretty much at bay. As the match wore on, the quality of the Korean side showed as they settled into a possession game and began to test SAFFC’s defence with crosses in the box and neat one-twos through the middle. From then on, it was always going to be a long night for SAFFC and it was evident that there will only be one winner in this contest. To SAFFC’s credit, they managed to hold off with a combination of some outstanding saves from keeper Sharil Jantan and some poor finishing from Suwon. The tide only turned tremendously in Suwon’s favour in the last min of the first half when Brazilian import Vendrechovski Junior Anselmo struck an unstoppable free kick into the top corner of SAFFC’s goal. The second half was very much the same story as Suwon looked to increase their lead to kill off the tie. SAFFC were left with a huge mountain to climb when Ivan Lovric was sent off for a second bookable offence. In the 73rd min, Suwon’s Brazilian forward Rodrigues Mota Junior Jose Roberto scored Suwon’s second of the night with a superb effort that gave Sharil no chance. SAFFC did manage to break away occasionally throughout but were always out numbered by the solid Korean defence. Suwon did not look anywhere near their best, probably affected by the humid Singapore weather and the punishing artificial turf at the Jalan Besar Stadium. In the end, Suwon deserved to win perhaps by a larger score line with an accomplished and professional display. Analysis from the sideline This game provides a useful insight into SAFFC’s overall progress as a team, as they also played Suwon last season. A year ago, they were totally outplayed and couldn’t even get out of their own half to create chances. Suwon also played much better than they did last year and their class was evident in the middle of park, where their players exchanged neat passes and kept possession well. Despite an overhaul in personnel, SAFFC looked better prepared this season. They were certainly not overawed by the occasion and the players kept to their task and were more than a match for the Koreans. They were not content to just sit back and defend, creating a few good scoring chances of their own. The final result may have been identical to last year’s, but SAFFC can take pride in this performance and understand that they should only get better from here. J-League giants Gamba Osaka are the next to visit Singapore and they will no doubt provide a stiffer challenge to SAFFC. It will be easy to reiterate that the gulf between SAFFC and the rest of the East Asian club sides is still wide, but it can be said that this gap is closing slowly but surely. Yesterday, Indonesian club side Persipura Jayapura were hammered 9-0 in China. With this in mind, SAFFC’s performance here looks a whole lot more respectable. -------------------------------------------------------------------------------------------------------------------------------- About the author – MJ has watched more S-League games than anyone he knows and hopes to see it blossom into one of the strongest leagues in the region. He is however annoyed by the lack coverage in the mainstream media and hopes to be the alternative voice. Also by MJ Lions on the verge of making history FAS fails to learn from past mistakes  Read More →