TR EMERITUS

Dr Amy Khor In Parliament on Tuesday (27 May), Senior Minister of State for Manpower Amy Khor said that a "Singaporeans first" policy would not benefit the economy in the long term. It might constrain firms' hiring decisions and prompt them to move out of the country, she reasoned. Dr Khor said, "We are in fact putting the interests of Singaporeans first when we say that we want to grow the economy and job opportunities. But we need to be practical about how we go about doing it." Moreover, she said that the new Fair Consideration Framework (FCF), which will take effect from 1 August 2014, will give Singaporeans with the relevant skills "a fair chance" to compete for jobs. The ruling requires companies to advertise on a national job bank for 14 calendar days before they can apply to hire foreign PMETs on employment pass but the eventual hiring decision is still up to the companies. Compelling employers to hire Singaporean PMETs who might not have the right skills is likely to "introduce significant labour market rigidity", said Dr Khor. This could ultimately hurt Singaporeans, if companies relocate because their manpower needs are not met, she explained. She said that the Government's approach has been to help equip Singaporeans with the skills they need to fill "quality jobs". Understandably, Singaporeans are not too happy with Dr Khor's statements made in Parliament. Over in HWZ forum, netizens were visibly angry with her: yuri2: Singapore economy is for who ah? For foreigners and elites only, not for peasants? Strikk: Screw economy growth. What's economy growth when the citizens are not happy? Stupid mad rush for GDP. McGraw: Economy more important than Singaporeans! nivek999: she forgot who is paying her salary snap99: Economy first policy benefits pap and their salary/bonus kingkongikiss: with this type of mp mindset, we all finish... PC: a foreign uni fresh grad from a lowly rated uni in 3rd world country gets the job instead of a local fresh grad with local uni cert. so that means the former is a better fit for the job, has the correct skills and knowledge. something is very wrong with our education... Marill: I think we should rename Singapore to a new name called Openlegscountry. People who are born here will play the role of opening legs. People who are not born here will be invited with red carpet treatment to come and party and make a mess. The open legs people will have to clean up after them. One netizen said he is "sick and tired" of "them": icansing: how many more years before election? I dun want to hear this crap anymore. sick n tired of them. But another remarked that Dr Khor scored the highest percentage of valid votes in the last general election: cheesepiejhj: Sorry HOR she got the highest vote in 2011. Hong Kan north people love her HOR Indeed, she did score the highest with 70.6% of valid votes for Hong Kah North in GE2011: The reader who alerted TRE to this news said: The deal is very simple: You don't put Singaporeans first, Singaporeans won't put you first on the voting slip. You import rubbish to compete with us, we'll vote for rubbish to compete with you. Do unto others what you want others to do unto you. The reader also highlighted the following video captured during the 6.9 Million Population White Paper debate in Parliament last year: http://www.youtube.com/watch?v=SKIOawq3jRk The video shows Dr Khor saying that new citizens are equally committed to Singapore. In her speech, she used herself as an example. She said that she was not born in Singapore but "decided to cast her lot with Singaporeans". She asked, "So does that make me any less of a Singaporean citizen than someone born in Singapore?" "As much as new citizen could pick up and leave Singapore, so could any other (native) Singaporean," she added.  Read More →

Blogger Roy Ngerng Blogger Roy Ngerng has responded through his lawyer M Ravi to PM Lee today (28 May) [Link], in the light of the latter's decision to go ahead and sue him for defamation ('PM Lee to sue Roy for damages'). Mr Ravi wrote to Mr Davinder Singh SC, PM Lee's lawyer at Drew & Napier LLC. Mr Ravi clarified that for the avoidance of doubt, other posts about CPF should not be construed as a curtailment of Roy’s right to his "freedom of expression to write or engage the public on the CPF issue" and raise any matters relating to CPF that "require transparency and accountability to the public". Mr Ravi said that the other articles relating to CPF do not refer to the PM. He said, "Any attempt to curtail this would be frowned upon by Article 14 of the Constitution of the Republic of Singapore, especially since these other posts do not refer directly to your client (PM Lee)." Mr Ravi then quoted Article 23 of the ASEAN Human Rights Charter: Every person has the right to freedom of opinion and expression, including freedom to hold opinions without interference and to seek, receive and impart information, whether orally, in writing or through any other medium of that person’s choice. "Our client’s clarion call for an open dialogue on the CPF issue is also in line with recent parliamentary exchanges that emphasize the importance of a robust debate," Mr Ravi added. Separately, Roy posted a message on his Facebook page at about 7pm today [Link]. He clarified that it is not true that by setting the offending YouTube video to private, he had the intention to share it privately. "I did not share the video with anyone else and it was for my own private consumption," Roy clarified. "This whole episode has arisen because of an article that I had written about Singaporeans' CPF. I have written more than 10 articles on the CPF and 400 other articles over the past 2 years. This is the first time that the prime minister has taken issue with any of the articles," he said. Roy also said that of the 4 additional articles the PM had asked him to take down, 2 were written in 2012 and 2013 which made no mention of the PM at all. He said, "As such, I wonder why the prime minister considers them as defamatory. I had taken down the articles because I did not want to complicate matters and wanted things to simmer down. However, I have now been taken to court." Roy added that the 2 articles in 2012 and 2013 detailed specifically how Singaporeans' CPF is being used to invest in GIC and Temasek Holdings. He said that he had traced them via links from government websites. "I am curious as to why these two articles are considered a threat to the case," he questioned. Roy said that there is no need to use the law to debate the CPF issue. He said, "We can sit down and have an adult conversation about this. If we can have a constructive discussion, we would be able to come out with better ideas to improve the CPF system. As yet, the prime minister has not responded (to Roy's proposal to have the conversation)." Roy said he blogs because he wants to raise awareness about what is going on in Singapore and how the lives of Singaporeans can be improved. He said that CPF is an issue close to his heart. "It's simply not right when our older Singaporeans have spent a large part of their lives working to build Singapore to where it is today, only to have to continue working as cleaners, labourers or cardboard collectors, just because they could never save enough in their CPF to retire. It's saddening that this has to happen, especially so when Singapore is now one of the richest countries in the world," he said. With regard to the lawsuit, he said he will have to stand up and continue the way forward. He said, "I will continue to question the truth of where our CPF is really going and advocate for transparency and accountability." "I do not know what awaits me, but I hope that I can continue to speak for change, to protect ourselves, our families and our children," he added. Roy has asked Singaporeans to stand with him.  Read More →

Some Misconceptions in the CPF Furore There are some rather incredulous allegations arising from the apparently, contradictory public information on CPF and the nation’s reserves in GIC and Temasek Holding. That these allegations exist meant that the issue is totally clouded with obfuscation but some of these allegations do not help in the legitimate calls by the public for more transparency and debate. The Relevant Statements The writer believes the contradictory statements are as follows: On the investment of CPF monies, the Ministry of Finance states: The Singapore Government enjoys the highest short- and long-term credit ratings of AAA from the three main credit-rating agencies. This can be partly attributed to the following features: a) Borrowings are not for spending. Singapore Government Securities (SGS) are issued to develop the domestic debt market and Special Singapore Government Securities (SSGS) are non-tradable bonds issued specifically to meet the investment needs of the Central Provident Fund (CPF) Board. b) Under the protection of reserves framework in the Constitution, the Singapore Government cannot spend the monies raised from SGS and SSGS. c) All borrowing proceeds are therefore invested. The investment returns are more than sufficient to cover the debt serving costs. Surplus returns belong to Past Reserves and cannot be spent by the Government.“ [Link:  Singapore Government Borrowings - An Overview] So far so good but then, GIC and Temasek Holdings have this to say: Does GIC invest CPF monies? The short answer is that GIC manages the Government’s reserves, but as to how the funds from CPF monies flow into reserves which could then be managed by either MAS, GIC or Temasek, this is not made explicit to us………” It went gone to regurgitate the above statement from the MOF. [Link:  GIC - FAQs] Temasek does not manage any CPF savings - these are managed by the Board of the Central Provident Fund, the Government surpluses, nor does it manage Singapore’s Official Foreign Reserves, which are managed by the Monetary Authority of Singapore.” [Link:  Temasek - FAQs] The Misunderstanding So here we have a contradiction. The government says CPF monies bought into SSGS whose proceeds are invested. The agencies on the other hand put their hands up and asked “Invest CPF monies? Who? Me?” or so it will appear to the layman. Let’s backtrack for a moment. The government’s Treasury receives cash inflows from taxes and government borrowings (SSGS and SGS) and cash outflows due to expenditures. Besides the fact that the government usually has a primarily budget surplus, i.e. revenues greater than expenditure, the government also have proceeds from the issuance of SSGS and SGS which it cannot spend under the Constitution. Therefore, the Government Treasury will have a persistent surplus of cash flow which has to be invested as government reserves. Now consider that the agencies, particularly GIC and Temasek, are separate legal entities from the government. Although owned by the government, they operate at a legal arms length. The agencies see the government cash flows coming into their balance sheet as reserves transfer in the case of GIC and capital injection in the case of Temasek but it is not in their remit to ascertain what proportion of the inflows are proceeds from SSGS, what are SGS and what are budget surpluses. It is the same as the writer’s day job in which he receives cash inflows from clients; so long as they are bona fide and approved, it is immaterial if the cash flows are working capital, bank borrowings, dividends etc. So yes, the agencies received reserves from the government but no, they cannot say explicitly if they are managing CPF monies, only that they are managing reserves. How Do We Know What the MOF Say Is True Look up the latest CPF Annual Report. Page 21, line item 7 “Held-to-maturity financial assets” listed fixed and floating rate SSGS invested by CPF. What about the agencies’ side of the equation? Refer the Net Investment Returns Contribution (NIRC) framework which states “comprised up to 50% of the net investment returns on the net assets managed by MAS and GIC and up to 50% of the investment income from the remaining assets which includes Temasek”. In layman’s term, this means the returns and income generated from the three agencies must first pay off the interest of the government’s debt obligations before 50% is made available for supplementary spending . That the returns have to pay off the interest on the SSGS meant that proceeds from SSGS and hence CPF monies are in the agencies. Is the money still there? Certainly, otherwise the government would not have been able to pull the $8.1b PGP out of the rabbit’s hat if not for the NIRC framework. Quod Erat Demonstratum Conclusion The writer hopes this dispels the misconceptions of some that the monies have “disappeared” and of those who criticize Roy Ngerng for being wrong about the CPF-GIC/Temasek connection and who held beliefs that somehow the monies are invested separately from the agencies. The writer also hopes to steer away from allegations that lacked credibility, take the heat out of the emotions and focus the battle on the real issue of CPF: transparency, accountability, choice, effectiveness or even relevance for healthcare and retirement. Chris K * The writer 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 →