TR EMERITUS

From our Correspondent The man, or rather, the lady at the center of the controversy, Ms Swetal Agarwal has replied. (read article here) In a letter to the Straits Times Forum on 20 August 2009, Ms Swetal Agarwal wrote that she is happy being a PR though she does not get equal benefits in housing and other aspects. However, she was adamant that her child get the best education in Singapore: "But where our children are concerned, we just want them to have the best education possible and I think we are not asking much.......where schooling is concerned, 'every child has the right to get the best education possible'." Ms Swetal Agarwal did not explain why she did not choose to take up Singapore citizenship after living here for 6 years. "About living here for six years and not taking citizenship, I think this is a very personal choice.", she wrote. Unfortunately, many Singapore citizens do not enjoy the luxury of 'personal choice' as Ms Swetal. They are stuck with the citizenship with nowhere to go. On the other hand, Ms Swetal can always choose to return to India where the cost of living is much lower. Ms Swetal is not alone. There many Malaysian and Chinese PRs who refuse to become Singapore new citizens in order to enjoy the "best of both worlds". They earn decent salaries in Singapore which when converted to their native currencies, will enable them to retire comfortably in their homelands. Therefore, many do not see their future in Singapore. Ms Swetal ended her letter by proclaiming her loyalty to India: "I am proud to be a citizen of my country and have PR status in Singapore." Many Singaporeans would be envious of her position. How nice it is to be a Singapore citizen and a Australian or Canadian PR at the same time. In the meanwhile, the furore over foreigners being "given a free meal" continues unabated with one Singaporean calling on the government to start new citizens on 'quasi-national service'. (read letter here) Bryan Tan wrote of his suggestion: "Besides being seen to contribute to society, they can also integrate into society faster by interacting with people at various levels. By serving in hospitals or charities, they will gain an instant insight into cultural and religious aspects of the community of which they will become part." While Singapore men spent two years of the best years of their lives in the army, it seems a "good deal" for the new citizens to do contribute to Singapore by serving in civilian institutions. The question is: does the government have any political will or courage to implement it?   Related articles: >> PRs get equal chance in Primary 1 registration >> MM Lee defends need for foreign talent >> PRC student supports government’s plan for more foreign scholars  Read More →

By Jeremy Koh (Guest Columnist) and Eugene Yeo (Consultant Editor) In a Straits Times report, it was reported that the Baby Bonus introduced by the government has failed to boost the flagging birth rate despite the increment last year. (read article here) $230 million was given out by the Government in baby bonus payments last year, up from $55 million just five years earlier. But there was no corresponding increase in the number of Singaporean babies born. The Baby Bonus Scheme aims to encourage Singaporean couples to have babies by easing the financial burden on parents. A reason commonly cited for the unwillingness of Singaporeans to have children is the high cost of living, especially that of housing. The price of HDB resale flats and that of new flats whose prices are pegged to it have risen dramatically in recent years. Data from the Housing and Development Board showed the resale price index rising 1.4 per cent from the previous quarter to 140.2 in Q2. This is the highest level seen since 1990. Over 85% of Singaporeans living in public housing built by the HDB. Though it is meant to affordable to the masses, the relentless price hike have squeezed some Singaporeans out of the market, especially young couples who are first-time genuine home-buyers. Last month, HDB launched a premium project offering 769 new flats in Punggol. It offers 615 four-roomers and 154 five-room flats in a central location just five minutes from Punggol MRT station. Four-room flats of 91 to 96 sq m are going for $264,000 to $322,000, while five-roomers of 114 sq m are on sale from $344,000 to $409,000. The CPF housing grant and the HDB housing loan are two schemes that have helped maintain the affordability. The combined income ceiling of $8,000 a month to be eligible for the schemes has been in place since 1994. Since then, the HDB resale price index has gone up by a staggering 190 per cent. The CPF Housing Grant Scheme is a housing subsidy provided by the Singapore Government to assist Singapore Citizens to own a HDB flat at a cheaper rate, or we call it a HDB subsidy. The grant can range from S$30,000 to S$40,000, however there is a catch ( or in fact many catches!), if you had obtained the grant when you purchase your flat, you will be required to pay a resale levey when you sell it. This resale level can be as high as S$50,000 for Executive flat and you need to occupy the flat for 5 years before you could purchase another flat directly from HDB. Even with a $30,000 housing grant, a young couple buying a new 4-room flat at $250,000 will still have to fork out $220,000 which amounts to a monthly loan of between $800 to $1,200 a month payable over a thirty year period depending on the type of interest scheme. For a resale HDB flat in a prime area like Bishan, the price ranges from $350,000 to $400,000. The monthly installments will be between $1,100 and $1,400. The median pay of the average Singapore worker is about $3,440 a month and it has stagnated over the last few years. (source: http://www.worldsalaries.org/singapore.shtml) After the compulsory deduction of 20% to CPF, the take home pay is only $2,750. The Singapore worker will be left between $1,500 and $2,000 after paying for the mortage loan. It will be very tough for one to start a family with such a pay. Of course the above calculations are just gross estimates and the government should be in a better position to shed more light on the affordability of HDB flats. However, till now, ministers such as Mah Bow Tan and Lim Hwee Hua remain adamant that HDB flats remains "affordable" to the majority of Singaporeans. It defies common logic for the government to peg HDB flats to that of the private property market which is extremely volatile and inflationary in the last few years with the influx of foreigners buying up properties in Singapore. About 70% of the buyers of private properties are foreigners. Throughout these years, it is not known if the government has made any "profit" from the construction and sale of HDB flats. What is the price of the land? A significant proportion of the land in Singapore is owned by a government-linked company, Singapore Land Limited. What is the cost of building each HDB unit? What is the difference, (if any), between the construction cost and sale price and where does it go to? The government has refrained from answering these legitimate questions on the mind of Singaporeans for the past two decades, preferring to congratulate itself for raising the home ownership of Singaporeans to more than 95%. Though technically, 95% of Singaporeans "own" their HDB flats, they are merely renting it from the government for a maximum period of 99 years since it is a leasehold and not freehold project. Freehold properties usually command a higher price than leasehold ones in the same vicinity by 10 to 20%. The reason why HDB flats are commanding such a high valuation is that shelter over one's head is a basic necessity. Unlike in Malaysia, Hong Kong, Taiwan or China, where one can pack up and live in the countryside, there is nowhere to go in Singapore. In other words, prices of HDB flats will continue to climb unless the government step in and modulate its mode of valuation because there is always a ready market for it. The influx of foreigners and PRs have also helped to artificially inflate the price of HDB flats. Singaporeans may have "double" or even "tripled" the value of their HDB flats in the last ten years, but don't forget after making a profit from the sale of their properties, they still have to pay for another new flat at a higher price with the unwanted effect of plunging Singaporeans further and further into debt. According to an AXA study done last year, it is estimated that for the average Singaporean, CPF savings will provide only a quarter of the funds he or she will need in old age which defeats its original purpose of being a retirement fund for Singaporeansn when it was first formulated in 1967.(source: Asiaone) With no social safety net to speak of, Singaporeans face a grim and uncertain future, especially those from the middle and lower income group. The middle class will be more severely squeezed as they do not qualify for any government subsidies. The "sandwiched" generation - those with children and aged parents to take of, may find life a continuous struggle to earn enough money to keep afloat. It is not easy to bring up a child. Not only must one ensure he/she is well fed and clothed, time and resources have to be expended to educate them so that they will become well-behaved, productive and useful citizens to the nation. With so many tasks to juggle at the same time, it is no wonder that Singaporeans are opting to have a smaller family, if any at all. The government should look at and deal with the root cause of the problem rather than giving cash handouts which does little to ameliorate the difficulties faced by Singaporeans trying to start a family. It has been 15 years since the HDB since the HDB housing grant was first introduced. Given the different set of circumstances we are in now, perhaps it is time to re-evaluate the scheme. For a start, the cost price of new HDB flats should be pegged not at two-thirds of reslae flats in the vicinity, but at the median pay of the Singapore worker, e.g. 5 times for 4-room flats and 6 times for 5-room flats which work to about a price of $170,000 and $204,000 respectively. With the decrease in the prices of new flats, the resale market will gradually be cooled and fall to more sustainable levels. The $8,000 ceiling for the grant's qualification should be increased to $12,000 or more and the housing grant raised to between $50,000 and $70,000. Though the government may made a "loss" in doing so, it owes the citizens who voted for it a duty of care. Besides, even at much "knocked-down" prices, HDB may still able to make a hefty "profit". How much money did the government gain from the sale of HDB flats, the levies earned from resale flats and the CPF contributions of Singaporeans after all these years? Are they used to finance the investments made by Temasek and GIC? Till today, these figures remain enshrouded in a cloak of secrecy. Boosting the birth rates of Singaporeans will reduce our dependence on foreigners who now made up almost a third of the population. Reducing the pressure on Singaporeans will lead to a happier citizenry and increase our domestic consumption, thereby decreasing on reliance on foreign exports. A fundamental shift in the government's mindset and policy is needed to reverse our flagging birth rates. As history has already shown, giving cash handouts in the form of Baby bonus and recruiting foreigners en masse will not solve the root of the problem.   Related articles: >> Mass market buyers now inflating property prices by Jeremy Koh >> Record home sales: a boom or bomb in the making? by Jeremy Koh and Eugene Yeo >> Budget does not address long-term inadequacies in corporatist model by Jeremy Koh and Eugene Yeo  Read More →

From our Correspondent Nominated member of Parliament Viswa Sadasivan has made a call for "repoliticizing" of universities during his 50-minute maiden speech in Parliament. He began by lamenting how beautifully crafted the National Pledge was, and said it was a waste that its meaning and power are not understood enough or reflected on. To ensure that the Pledge means more than just words for all citizens, Mr Sadasivan argued that Parliament should lead the way by ensuring that the tenets of the Pledge have primacy when considering national policies. He highlighted what he considered four key tenets: the idea of citizenship, inter-racial and religious unity, democracy and the balance between happiness and prosperity. Mr Sadasivan gave several suggestions on how national policies could be better aligned with these principles, one of which is to encourage political associations in universities - once a base of political interest and activism - and allow campus rallies to rouse the young from apathy. Student activism has long been non-existent in Singapore's universities. Singapore undergraduates are more concerned about passing examinations and getting a job upon graduation than politics. Political activities are also explicitly banned on campus ground. Last year, NTU barred SDP members led by Dr Chee from fraternizing with its students. A letter written by a student on the matter was removed from the students' newsletter just before publication. It is highly unlikely that the government will be receptive to Mr Sadasivan's proposal to "repoliticize" Singapore's universities. Universities have always been a hotbed for political activism and dissent worldwide and the ruling party is well aware of its potential threat to their continued hegemony. One of the harshest critic of MM Lee and the PAP in the 1970s is student leader Tan Wah Piow, then President of the University of Singapore Student Union. Tan was charged in 1974, together with two others, with rioting inside the premises of the Pioneer Industries Employees Union, a government-controlled trade union, even though he was nowhere near the office where he was supposed to have 'broken some chairs'. Tan was sentenced to one year imprisonment and after his release in 1976, he fled to London via Johor Bahru. From then now, politicial activism simmered and eventually died down on the University of Singapore, which was the sole university then. Even if the government wants to "revive" the political "spirit" of the campuses, few students will dare to take the "bait" given its track record of harsh treatment dished out to political dissidents.  Read More →