TR EMERITUS

A weekend protest in Kolkata: tougher laws against sexual offenders have failed to stem the tide of violence against women across India. (Photo: Piyal Adhikary/EPA) (8 June 2014 )   Ramsevak Paikra, home minister responsible for law and order, sparks outrage after saying rapes did not happen on purpose. A minister from the ruling party of the Indian prime minister, Narendra Modi, has said rapes happen "accidentally", amid renewed outrage over attacks against women. In the latest controversial remarks by a politician, Ramsevak Paikra, the home minister of central Chhattisgarh state, who is responsible for law and order, said on Saturday that rapes did not happen on purpose. "Such incidents [rapes] do not happen deliberately. These kind of incidents happen accidentally," Paikra, of the Bharatiya Janata party (BJP), which also rules at the national level, told reporters. Read more: www.theguardian.com/world/2014/jun/08/indian-minister-rape-remark-anger-violence-women  Read More →

At this moment, arguably the potential top hot potato issue the masses are concerned in is likely to be none other than the CPF ever increasing Minimum Sum and the ever push back withdrawal age. The likely next hot potato to come in a close second is arguably job opportunities and threats faced by the masses from cheap foreign labour. The probable third hot issue is the widening income inequality gap caused by rising rentals across the economy resulting in a myriad of costs being passed on and borne by the masses in the end. Others like children's education, local issues and other social, economic and political issues shall be discussed and analysed. It is mind boggling that at the rate the Minimum Sum in the CPF is being raised, it is not an exaggeration to foresee that for those in their twenties and thirties, the amount being locked up when they reached 55 could be at least S$400,000 to S$500,000 in 20 to 30 years time including the Medisave Minimum Sum citizens need to maintain inside their CPF. That is not factoring in the forever pushing back of the withdrawal age which currently stands at 65. Even then at current prices, withdrawal amount are generally at a pittance few hundred dollars on the average across the board and a far fetch from golden retirement years after a life time of slogging in a pressure cooker society. For the younger generation, such concern is likely to set off chain decision in their outlook and choices. For some, heading off to the airport for the first flight out when a viable employment opportunity arises elsewhere seems to be a logical, wise and rational choice. For those staying back for whatever reasons, it is highly unlikely they would want to be parents of half a dozen offspring. Probably for many, given the choice, not even one. The regime's "half-hearted, disinterested and failed" procreation policy looks like going for a further astronomical, epic failure. Possibly before the turn of the century by 2019/ 2020 or even earlier, TFR is likely going to dip below 1.0 and this is likely going to create an unprecedented unease and tension. By then, it is likely to be too late. This regime could be the worst in human history record in terms of handling the TFR issue. Game over? Without a decent and reasonably paying respectable job, likely everything else is secondary and moot. With the relentless opening of the flood gates in the past two decades, the damage is likely done. The deep sense of insecurity and lack of confidence in the future and deep distrust in the establishment is highly possibly and indelibly imprinted and engraved in the hearts and minds of the masses. With many highly educated PMEs in their late thirties, forties and fifties being sidelined, retrenched and forced to drive taxis, taking up lowly security guard jobs to put food on the table as precedents, those among the younger generation are likely not going to make the same mistake as their uncles, aunties and parents. Another issue which should be of serious concern is on the economic front. In 2010, with a population of 5,076,000, domestic private consumption expenditure was at S$114,518,500,000. At the per capita level it is S$22,558 at the same year market price ( 2010 market price ). Looking at the per capita figure for private consumption expenditure for 2011, 2012 and 2013, the figures are S$23,032, S$23,359 and S$23,582 respectively at 2010 market prices. The increase in percentage terms for per capita private consumption expenditure is 2.1%, 1.42% and 0.96% for the year 2011, 2012 and 2013 respectively. The population for those three years namely 2011, 2012 and 2013 were 5,183,700, 5,312,400 and 5,399,000 respectively. What does the percentage increase of the private consumption expenditure in 2011, 2012 and 2013 reveal? What economic story is it telling or simmering underneath such statistics? Looking at such figures under the backdrop of other domestic economic figures reveal an "alarming" trend. Delving further into the individual spending components of the private consumption expenditure confirms the unmistakable trend of falling private consumption expenditure relative to overall GDP growth. How could this be? How to explain it in economic terms? As we know, the poor or the masses spend a larger proportion of their disposable income on essentials and basic necessities than the rich and well-heeled. If a larger share of national income is in the hands of the rich, what would happen? As mentioned, the marginal propensity to consume is far smaller for the rich as a percentage of their total income than the poor or masses. Aggregate total private consumption is likely to fall or grow at a much slower rate than GDP increase when more wealth are in the hands of the rich. The numbers in 2011, 2012, 2013 confirm such a trend. Looking at the minute breakdown of the individual components of the consumption expenditure patterns reinforced the unmistakable pattern and trend mentioned above. Now the problem is this could be the beginning of a longer term trend and 2011, 2012 and 2013 could be at the beginning of the curve. This implies economic condition is likely to get worst for the poor or masses in the coming years especially the next three to five years given current trend. Life would be more and more unbearable not only for the bottom 30% but also the lower middle income who are likely to be squeezed adversely and feeling the economic heat ever more and more. Economic decisions taken by a ruling regime is always about opportunity cost and trade off. The need to enrich the already wealthy and well-off and at the same time ensure the masses are not disproportionately disadvantaged by economic policies and decisions have to be seen to be equitably and fairly balanced. After all, where did all the economic policies originate or emanate from? From the ground? The people? The masses? How can it be? Obviously the establishment is the sole monopoly for economic decisions carried out such as monetary policies, fiscal policies, wage polices, immigration policies etc and thus holds the sole responsibility for any consequences and impact on the masses livelihood. How the situation come about till this worrisome stage is a rather complicated and long story and shall not be dealt with and discussed here and at this stage. For the other issues mentioned in the opening paragraph, it shall be touched on in Part 2: Further Potential Hot Potato Issues Concerning the Masses. P S S * The author blogs at pro-sustainable-sg.blogspot.  Read More →

07.06.2014 Return Our CPF@HLP - Leong Sze Hian Speech at CPF protest In my speech during the CPF Protest (Return My CPF) on 7 Jun at Speakers’ Corner, I said that Singaporeans may be short-changed by about $1 million because we probably pay the lowest real rate of return amongst national pension schemes in the world, historically in the last 25 years or so. How to calculate lost $1m? Quite a number of people have asked me as to how the figures can be derived. Difference between 3 and 6% from age 21 to 65? So, here’s an example. If you start work at say 21 years old with a salary of $1,500 – increasing at 4% per annum until age 65 – at 3% interest, you would have accumulated $1,491,087 at age 65. Average overall interest rate on CPF accounts?  As there is no disclosure as to what is the average overall interest rate on all the different CPF accounts (Ordinary 2.5%, Special, Medisave and Retirement 4.0% plus an extra 1% on the first $60,000) – we have assumed the average overall CPF interest rate of 3% in the above computation projection. If the nominal rate of return is say 6% (the historical average real rate of return after adjusting for inflation of national pension schemes in the world is we believe about 4%) – you would have accumulated $2,953,777. Difference of $1.5m in 44 years? So, you may in a sense, have been short-changed by $1,462,690 ($2,953,777 minus $1,491,087)! And we have not even factored in the difference in the returns of 3% (6 minus 3%) from age 65 onwards until death under the CPF Life scheme which pays 4% on the Retirement Account balance plus an extra 1% interest on the first $60,000 only (with any excess CPF that can be withdrawn but is left in the CPF earning 2.5% only). Assumptions? Note: We have assumed a 4% increase annually in the salary because the annualised real total wage growth from 2003 to 2013 was 1.5% and historical inflation in Singapore is about 2 plus % – and the Government’s target for real wage growth for the decade is 30% (2.7% per annum). Also, assuming that CPF contribution rates and ceilings may also increase in nominal terms in the future because of inflation, in line with the 4% salary increase. SY Lee and Leong Sze Hian  Read More →