TR EMERITUS

24 July 2014 This is an open letter to HDB Branch office of Toa Payoh (HDB), Town Council of Potong Pasir (TCPP) and the MP of Potong Pasir, Mr Sitoh Yih Pin. On 5 June 2014, I wrote to Mr Sitoh’s FB reported the inferior workmanship of the old timber air-conditioning panel with one side of the frame was stuff with paper to fill-up the gaps between the frame and wall. This sub-standard workmanship allowed water-seepage into my master-bed room floor. The master-bed room floor was originally installed with ceramic tiles but later I added on with timber plywood and vinyl floor sheet some four years ago. As a result of the water seepage, the timber plywood backing in various part of the master-bed room is damaged and rotten and the floor no longer leveled. Both the TCPP and the HDB branch officer came to inspect the unit without a prior appointment in different time occasions. The HDB replied via its letter dated 15 July 2014 and read by me today. HDB stated under its SOP that the maintenance of the air-con panel falls within the responsibility of TCPP and the Lessee (that's me in this case) of the flat unit. It has no mentioned and has totally ignored the fact and existence of inferior workmanship of the air-con panel. A defective work remains a defective work, be it 12 months or 30 years after completion! I disagree that I should maintain a defective work on behalf of HDB and it is never cross my mind that HDB would allow its contractor to fill the gaps with paper instead of proper cement grouting. In the question of whether TCPP should be maintaining a defective work on behalf of HDB is not within my boundary of knowledge but should it not properly define in the Town Council Acts, it must be the failure of the law makers or might with the intention to absorb HDB from liable to the failure to deliver a reasonable workman like quality housing so fundamental a responsibility of HDB to provide in the first place. Until to-date, no solution has put in place for the defective designed roof which allowed birds to reside in the open roof space. I do not have the luxury to open my windows as freely as I should in the fear of bird droppings may land in my unit floor. My window glass and laundry are constantly soiled by bird droppings. May I remind you of a recent case where a bird had intruded into the lift shaft that died above the lift car. TCPP reported that a mesh had hole that allowed the bird to pass through. Industrial practice would have brick wall to close up the Lift Motor Room! If wire mesh was to be installed, at least a galvanized mesh to be in place for better resistance against corrosion! This is a problem roof that HDB had put up some 30 years back! The HDB’s reply of 15 July 2014 is evasive of its responsibility altogether and is of my view, “irresponsible”!   Potong Pasir Resident [Source]: https://www.facebook.com/pages/Potong-Pasir-issues/137219996355207   Editor's note: PAP Sitoh Yih Pin garnered 7,992 votes, 114 more votes than SPP Lina Chiam in 2011 GE for Potong Pasir SMC.  Read More →

I refer to the 24 Jul 2014 Straits Times letter “Lack of kids' books on Singapore history” by Ms Irene Louis. Ms Louis was taken aback by the high price of a children’s book on Lee Kuan Yew. She pointed out that in the US; children’s books on George Washington and Abraham Lincoln are plentiful and cheap and reasoned that it was because Americans have been exposed from young through colorful storybooks that they take pride in their past. So she suggested making children’s books like the one on Lee Kuan Yew cheaper to instill national pride in the young and asked the government to look into it. Ms Louis should refer to the 29 Jul 2014 Straits Times report “Same name, different lives”. Photographer Samuel He was quoted as saying Mr Lee’s “name stirs up equal amounts of pride and anger among Singaporeans." Ms Louis should therefore understand that Lee Kuan Yew is no George Washington or Abraham Lincoln. He is not respected by all Singaporeans, not even most Singaporeans but perhaps half of Singaporeans only. Therefore, a storybook on Lee Kuan Yew will only instill as much national anger as it would instill national pride. It is better for Ms Louis to look to other less controversial figures to instill national pride in the young of which there are plenty like Sir Stamford Raffles, Lim Bo Seng, Goh Keng Swee, Yusof Ishak, Lee Kong Chian and so on. Ms Louis should also understand that Americans take pride in their founding fathers not because they were exposed from young but because their deeds were indisputable. On the other hand, many Singaporeans cannot take pride in Lee Kuan Yew because he is not even a founding father by any definition and nearly all the good deeds that have been attributed to him were deeds by others like Dr Winsemius and so on. How to take pride in someone whose good deeds belong to others? Thank you   Ng Kok Lim Straits Times, Lack of kids' books on Singapore history, 24 Jul 2014 MY EIGHT-YEAR-OLD enjoys social studies in school and often asks me questions about Singapore's history. To cater to her interest, I tried to find books on Singapore's past that are suitable for children, and found there were not many. After much searching, I managed to buy the book Samsui Girl by Lee-Ling Ho. It was stocked by only one supplier and can be bought only online. At Popular Bookstore, I was glad to find the children's book Growing Up With Lee Kuan Yew by Lawrence Koh Choon Teck, but I was taken aback by its $21.90 price tag. In the United States, children's books on George Washington, Abraham Lincoln and other important figures in the country's past are easily available at very affordable prices. Perhaps this is why Americans take pride in their country's past, having been exposed to it from a young age through colourful storybooks. In Singapore, much reading of the country's history is done in the pages of a textbook, as a subject in school. Since there are so few storybooks on Singapore's history, can't the ones we have be made more readily available and at prices that would entice Singaporeans to buy them? How can we hope to instil national pride in the young when the resources are limited? As the country's population grows more diverse, this is an area of learning that the Government must look into. Irene Louis (Ms)  Read More →

[Editor's note: Excellent revelation by Chris K. A must-read for all Singaporeans who are concerned of his CPF funds] The writer turns the big 55 sometime in early 2015 and very likely retired. Therefore, he faces two important decisions: what to do with his CPF and with his UK employee pension. His CPF is a no-brainer; withdraw every last permissible dollar and hope for the rest. It is with the UK pension that is of interest as a comparison to CPF. Two Equal Pots The writer had contributions into his CPF for 11 years and had the account for 33 years. He had contributions into his UK pension for 9 years and had the account for 17 years. The total amount of contributions was nearly the same but despite the much shorter term; the UK pension provided nearly the same accumulated amount as CPF down to $1,000. This is due to the superior investment performance of the UK pension despite a 25% valuation loss in 2008 and a 30% loss in currency depreciation. Does that mean he took excessive risks to overcome these losses? No, the portfolio mix was 70% listed equities funds, 30% high grade bond funds; roughly similar to GIC, nearly matching its 20 year S$ rate of return. Superior Returns due to Flexibility The superior performance of UK pension over CPF was due to flexibility. Once the account is set up by the employer, the writer decides what he invests, subject to the trustees’ investment criteria (e.g. no unlisted securities, no account churning). Unlike CPF, the UK pension was not coerced into investing in low returns government bonds. In reality, nobody put every single pound in government bonds and therein lays the truism about risk. One can avoid the risk of losing money in the markets by finding comfort in “risk free”, “guaranteed” government bonds but one cannot run away from risk altogether since those comfy government bonds have the risk that they may not account for the rise in both the cost and the standard of living. UK Pension stricter on withdrawal Under UK legislation until 2014, the earliest that one can withdraw from the pension account is age 55. Although the writer owns the monies in the pension account, the withdrawal is only 30% of the pension pot. This is “stricter” than CPF Minimum Sum but the remainder of pension pot can be used to purchase an annuity or continue to self-invest to generate an income if one is retired, or to continue growing the account if one is still in work. There is no outcry over the withdrawal limit because it is transparent and can be used to fund retirement at anytime. Flexible Annuities Even in the UK, the majority of people will find self-investing for retirement income a rather daunting task.  As such, annuities are very important in pooling the risk of longevity and investments to provide a regular income to pension account holders. Another superiority over CPF is that one can buy an annuity anytime from age 55 onwards. Obviously the later one buys an annuity, the higher the income derived.  Compare to CPF Life, one do not have to wait until 65 to draw an income and thus avoid the sad case of expiring before drawing a single dollar. UK annuity income is normally fixed – changes in life expectancy and investment rates are born by the annuity provider. In contrast, CPF reserves to the right to change CPF Life payout; therefore the risk of retirement income is shifted entirely to the CPF member. From 2015 onwards, changes in UK legislation will keep the 30% withdrawal limit but allow subsequent annual withdrawals subject to the same 30% of the remaining balance. Annuity providers have responded by designing annuities that not only provide a regular income but with option of periodic withdrawals. One size fits nobody The government’s one size fit all approach is intellectually indolent; in the early years of a working life, a pension account should assume greater risk for higher return, e.g. more equities, less bonds and as one progresses towards the last stages of working life, the account should progressively shift to lower risk, e.g. less equities, more bonds.  To be coerced into a low risk, low return mode throughout an entire working life is to cause enormous opportunity costs to CPF members. Besides, this inflexible approach towards annuities failed to account for the persistent rise in long term unemployment among older workers, aged 50 and above, who need an income in the absence of stabilisation programs. "The present tweaking of the system is really to obscure the monopoly the government has over retirement funding which serve its own finances and political agenda" Conclusion The present tweaking of the system is really to obscure the monopoly the government has over retirement funding which serve its own finances and political agenda. The minimum sum ensure total amount of funds available for investments in GIC and Temasek remains enormous generating substantial discretionary spending through the Net Investment Return Contribution. The low rate of returns meant more excess returns are delivered to the NIRC and past reserves. The captive nature of long term savings meant interest rates are ridiculously low to the detriment of personal savings, generating even cheaper reserves for GIC and Temasek through issuance of SGS. The flexible UK employment pension is a good alternative to give citizens the freedom to manage their retirement savings according to age, needs, preferences and aspirations and is a good compromise to address both their concerns of not getting back their monies and the concern over adequacy. But it is this flexibility that is a threat to the government’s monopoly.   Chris K * Chris K holds a senior position in a global financial centre bigger than Singapore. He writes mostly on economic and financial matters to highlight misconceptions of economic policy in Singapore.    Read More →