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| 29/09/2007 |
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Singaporeans concerns,Singapore Inc, Foreign reserves and Political environment
By mark liu @ 10:46 PM :: 1453 Views ::
0 Comments
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Our country has come a long way in a short period of time. We should be proud of our achievements as a people. However, the journey is far from ever complete and our own people are faced with many problems. In all discussions with many singaporeans with a birthright to and a lifelong attachment to Singapore, all discussions eventually lead to several basic issues which seems to have all been swept under the carpet in the euphoria of past successes and seemingly also established fixed mindsets in the government.
Singaporeans main concerns today are:
1. high cost of living compared to local wage levels excluding the top 10% of all local wage earners and foreign workers. This is obvious if one sees a low wage earner having to work a lifetime to pay off their discounted low cost hdb flats which depreciates sharply after 25 years and at the same time ending up with insufficient retirement funds. Affordability is poor. Many foreign workers in the lower wage category have either free or cheap accomodation, transportation, etc but low wage singaporean workers do not enjoy such benefits. They are able to save the bulk of their salaries whereas low wage singaporeans are struggling to make good on their salaries and payments for housing, utilities, etc.
2. no job security and no welfare during their active working years from age 21/24 to 62. If you are working during this age period, you are expected to contribute to the best of your abilities to the state including serving national service, paying your taxes, etc etc and ultimately to build up the foreign reserves for a rainy day.
3. risk of high inflation, low real wage increases, low returns on retirement funds, high medical costs and high cost of bringing up children. All these ultimately end up with a lower quality of life as singaporeans generally work longer hours compared to more developed countries and for some even moonlighting to make ends meet with a 2nd job.
If the above concerns are not resolved in time and fast, we will continue to have a shrinking population and less cohesiveness and vitality as a country. No responsible adult would like to bring in children into this world and specifically this country to suffer if the best quality of life is all hard work, no financial security and no sincere welfare for the needy who fail inspite of trying their best.
Second, the success of Singapore Inc is something to be proud of. But it seems to have amass substantial wealth while the general population in the majority cannot even save the basic minimum cpf sum to pay them a nominal survival amount for 20 years after their active working years of some 40 years. Singaporeans sometimes wonder whether the country citizens are being treated as production units who when able to contribute are taken care of and when old, Singapore Inc treats its citizens as none of their concern. The old British East India Company is a good example of a highly successful profit oriented enterprise which built an empire from India to Myanmar and parts of SE Asia including Singapore. Yet inspite of all its profits for the english crown, it could not hang on because it did not care about the people welfare of it's territories and was considered negatively as an exploitative organisation. Singapore Inc is not look at negatively by singaporeans generally but current fixed mindsets for those in charge may swing opinions soon. On a per capita basis, singaporeans are said to have among the highest national savings with credit balances and yet we cannot bear to use part of these reserves to look after our own old who had contributed in the past.
Singapore's foreign reserves have been built up by the founding generation and current generation of singaporeans. No doubt that future generations of singaporeans will continue to contribute to these reserves in good times. The basic premise of building up foreign reserves is for it to be used in an emergency or an unforseen event. If one remembers Kuwait when it was invaded by Iraq, the Kuwaiti Investment Office which held the reserves of Kuwait was principally the only entity left functioning. Kuwait is fortunate then to have vast reserves of oil and gas while singapore has nothing which in the same scenario, no foreign armies like the US/UK may come to our rescue. Kuwait managed to get back on its feet after liberation and our reserves may one day do the same. However, the same reserves can be and must be put to use solely for the benefit of singaporeans, period. If current retired workers past age 85 today or future retirees without any means of financial support are not able to have some kind of support from these reserves like payment for extreme longevity annuity premiums and the reason given is self reliance, pooling of contributions including those who can least afford it and ensuring no subsidy from future generations of a smaller pool of singaporeans, well keeping tight fisted on these reserves amounts to a subsidy from a larger past and present generations of singaporeans to that smaller pool of future singaporeans. What are these reserves for then, if not for the welfare and benefit of all singaporeans, especially the poor? We should be mindful that we are not talking about active employable singaporeans but old age and past 85. Do you count the dollars and cents when your aged father,mother or grandparents of 85 needs your support? Are singaporeans despite our differences one family? More foreign born residents who some suspect are getting an increasing share of subsidies like lower rentals, medical fees, educational grants, etc. It is inevitable that if 25% of residents in Singapore are foreigners, their share of total subsidised benefits across the board are going up. These are the same group of people who are enjoyng these subsidies and are not picking up citizenship simply because they have it too good and want to have the capacity to pack up when a crisis hits. All this talk about friends who may stand up for us when Singapore is in trouble is nonsense. They are here to make money when able and will go back if conditions at home are the same or if the cost of living in their birthplace are lower. Ask most singaporeans past or near their retirement age about retiring in friendly neighbouring countries if allowed due to lower cost of living and most will understandably also opt for it. The important thing here is to make a greater differentiation between a singaporean and a non-singaporean. This is what matters in the heart. Hoarding of more reserves is not necessary a positive attribute but a subsidy from the past and present for future generations, the opposite of all pension funds which are in deficit.
Singapore has been most fortunate to have honest and capable leaders up to now. Our MM set the standard and it had been kept up by SM and now PM Lee HL. The discussion about Singapore political leaders having the highest political pay in the world may not go down well with the people in general when compared to the miserly pay of the bottom 25% of our population. Size of the country for governance purposes , problems encountered, etc etc may not be as difficult as larger countries like Indonesia but the government has delivered. Though most Singaporeans do not agree with this approach, we can live with it because the government has done good and is so far sincere in looking after the people. But will this luck in having honest bright people in political office hold in the truly long run and forever? History tells us that the probability of having a dishonest politician in charge one day is indeed high if one takes into account that politics operates in a Machiavellian environment. The trappings and benefits of political office with high world class pay and the enticing element of power in such an environment means that the risk to singaporeans are significant if too much of anything are kept and there is perceived insufficient transparency. It's going to attract all kind of attention and schemes, both local and foreign. Remember what MM said about the old Bukit Turf Club which accumulated huge reserves and were considering distributing it to their own members by dissolving the club.
All the changes made in parliament on the cpf, old age annuity, etc etc have good intentions. But good things if perceived negatively and where the welfare of the people are concerned and you can only defend it based on similar Singapore Inc objectives, trust diminshes.
The government must advise the general population on some basic questions concerning the above :
1. Have it done all it can? Can they do more?
2. Is the CPF inspite of all it's changes providing a world class return not only from the risk-free perspective but also for those who wanted to take on some risks? For the latter, it is obviously not the case due to the high costs of investing in funds through upfront fees and annual management fees regardless of positive or negative returns, the complete opposite of risk-free returns.
3. Can prices of discounted hbd flats be reduced further as it is the major costs for most low income singaporean as it eats into their cpf retirement savings? Can inflation be minimised as each GST increase result in substantial price increases in basic items and adjustments/rebates are only temporary while price increases because of government actions are permanent?
4. Can the government improve the majority of singaporeans quality of life so that they can and want to have more children? For those struggling to make ends meet, the IRs, F1, Esplanade, Sentosa seafront living is meaningless news and for over 80% of singaporeans, we just will not participate because of the lack of economic means or time or many other reasons. These are perceived sometimes as for the benefit of the rich 5% singaporean minority, foreigners and some businesses. Singaporeans mostly are requested to make additional sacrifices again with reduced space although IRs are likely to create more jobs but high paying ones??.
Go back to basics again but with a new mindset. Singaporeans have lost much in the race to succeed including real community closeness where neighbours do not spend much time socialising and many non quantifiable values while gaining mostly economic growth for Singapore Inc while the poor still struggle to have a good life. There is nothing wrong for them to make some demands which are not outrageous.
I pray not to see a Singapore with 50% foreigners and 50% citizens where only the top 10% of singaporeans and rich foreigners control the economy and assets including the most valuable properties while the majority of singaporeans become just another production digit in the big picture. The younger mps must not always compare singapore with new york, london or hong kong unless we have the same pay and benefits because new york or london is not representative of the conservative values of the usa or uk. Even if half these cities are occupied by foreigners, it will not change american or british society because of their much larger population base outside these cities but if it occurs in singapore city, the impact on our society will be huge. Will it survive with any form of a national identity in an ever changing world?
There are many other issues which can be done better by the government although without a doubt, the government has done good to date for most singaporeans. That's why singaporeans still stick with this government but hope that it is a better listener. It's not a bed of roses for the poor, the non world-class wage earners, the singles and lonely and the retirees or unemployable old with the high cost of living we faced. What's the point of having a world class city if singaporeans cannot afford to live in it and lose out after spending the national savings to build such a concept. Mind you, if such a concept comes true which I hope it does and ordinary singaporeans can live comfortably in it with their local wages or savings in their old age, it will be a dream come true for the current generation of workers and future generation of singaporeans.
There are excitement and optimism in the air but there are also major worries for the country, society and all singaporeans when the pursuit of 'economic gains' become the single most important factor for decision making rather than the overall welfare of singaporeans even if it involves only a minority section of the population.
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| 27/08/2007 |
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the golden years : elderly
By mark liu @ 11:21 PM :: 1111 Views ::
7 Comments ::  :: The Golden Years : Elderly
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the cpf should revert back to it's basic purpose of savings for singaporeans old age financial needs. it is shocking to see how little cash balances average singaporeans have in their cpf on reaching 55 to accomodate their potential future needs. understandably with the high cost of living in singapore, it is difficult for singaporeans to save cash outside their cpf contributions during their younger working days with so much to live for during those wonderful younger days and will be even more difficult if the city of fun materialise. the cpf has now evolved and may have lose it's way and we hear both the laymen and mps now talking about using the cpf to buy their first roof through public housing and hopefully upgrade to private housing. it is certainly not the purpose of the cpf to assist singaporeans to buy houses beyond their financial capability to service and certainly not within their means. cheap affordable quality public housing with the cpf should be the aim and the limit to be used to pay for housing should be restricted to a certain quantum of said between s$250,000 or s$300,000. After all, those who want to buy more expensive houses above such limits should be able to use their own cash savings or current earnings capacity outside the cpf to pay for the balance. this is needed to ensure that singaporeans only buy houses that are affordable according to their earnings capacity. cpf is meant for singaporeans old age and affordable public housing is the right of all singaporeans, both young and old. an increase in public housing prices for the old owners to be able to monetise in their old age becomes an even bigger future burden for young singaporeans aspiring to buy thir first roof and this becomes an even more expensive vicious cycle in terms of inflation and cost while salaries at the bottom are depressed by global economic forces. subsidies and more subsidies is a temporary necessity but not a long term solution for an island nation without natural resources except for team singapore. i applaud the pm for bringing up old age and retirement issues during the nd rally speech and paying tribute to team singapore rather than be elitist.
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