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Bitter medicine prescription – with a little spin thrown in

Posted by theonlinecitizen on February 26, 2008

Breaking News: Feb 27: Freeze on government fees extended till end of 2008. The one-year freeze on government fees which kicked in last July will be extended till the end of 2008. This will include fees charged on all government-provided services such as school fees, ITE and polytechnic fees, charges in public car parks, and all licence fees. (Channel NewsAsia)

By Andrew Loh

On 24th January, 2007, Prime Minister Lee Hsien Loong said the following, when justifying the increase of 2 per cent for the GST:

“Is it better to take your medicine sooner or stretch it out? Take medicine once or two times? I prefer to make (sic) my medicine early, why? This is something we need to do, once we have done it, we can move on; we have the resources to have the revenue from the GST that we use….” (Channel NewsAsia)

The PM was right in that the increase by 2 percentage points in the GST brought in the expected revenue for the government – $1.4 billion.

But do note that the $1.4 billion of GST collected so far is only for the months from July 2007 to March 2008. That is, 9 months, and not a one year (12 months) total. It follows then that the total one year collection of the 2% of GST could be as much as or close to $2 billion – dwarfing the initial projected $1.5 billion. (Singapore Budget)

(I stand corrected on the above but as far as I understand, that is what it is. No one seem to know for sure.)

Even the estimate for the total GST collection for FY2007 was way off the mark. The estimate made last year was $4.85 billion. The revised estimate in the 2008 Budget is $6 billion.

What was also unexpected was a budget surplus of $6.45 billion, a stark contrast to the $0.7 billion deficit which the government had projected.

Now, questions are being asked if the GST hike was needed in the first place. (See here and here.)

Why increase GST to 7%, say that the extra $1.5 billion would help the lower income, that the government would run a deficit of $700 million, and then have a budget surplus of $6.45 billion?

As my colleague Leong Sze Hian said, this is probably one of the most inaccurate budget forecasts in Singapore’s history.

PAP MPs’ praises

Yet, if you recall some PAP MPs’ reaction to Budget 2007, their praises were verging on the ecstatic. Tampines GRC MP Irene Ng described it as “an unprecedented new commitment”, and “incredibly generous”.

MP for Ang Mo Kio GRC, Lee Bee Wah, in defending the GST hike in 2007, rebutted the Workers’ Party chairman, Sylvia Lim:

“On Ms Lim’s criticism of the timing of the GST hike, she said it was better to raise the tax now while the economy was doing well, rather then wait till things took a turn for the worse. Using a Hokkien phrase, she warned against ‘looking for a toilet only when one needs to pass motion’, a comment that evoked laughter from the House.” (Link)

Dr Fatimah Lateef (Marine Parade GRC) said:

“Let me share with her (NCMP Sylvia Lim) that nowhere else in the world can you get a Budget which includes love and compassion in abundance as this one.”

Indeed, the prime minister was the strongest defender of the GST hike:

“That’s the way the PAP is – upfront – give the bitter medicine first and worry first and enjoy later on.” (Channel NewsAsia)

With the cost of living increasing at an alarming rate and inflation breaching record levels, one wonders when Singaporeans will get to “enjoy” the fruits of this so-called “golden era”.

“Growth Dividend” – really?

Instead of admitting and taking responsibility for the atrocious forecast, the government is now packaging the surplus as “Growth Dividends” and claiming to be sharing the fruits of such “growth” with Singaporeans.

The Straits Times senior writer, Chua Mui Hoong, describes it thus in the report titled, “Budget goodies for all S’poreans”:

“Despite it not being an election year, an impressive $865 million in ‘Growth Dividends’ will be given to all Singaporeans, with more rightly going to the lower-income worst hit by rising costs.

The figure is about 62 per cent of the $1.4 billion increased revenue from the hike in Goods and Services Tax – which means that through the Growth Dividend, the government is giving back to the man-in-the-street 60 cents of every extra dollar it collected from the GST hike.”

I fail to understand, as do many of my friends, how collecting GST of $1.4 billion and then giving back “60 cents of every extra dollar it collected from the GST hike” can be called “Growth Dividends”.

It is a media spin which has not gone unnoticed by many – and I think senior writers in the press should do better. It is like, I take $100 from you, give you back $60 and then say I am sharing my profits with you – and having the cheek to call it “growth dividends” in the same breath!

Budget deficit forecast not the only wrong forecast

If you think the budget deficit forecast is the only one which is way off the mark, my colleague Sze Hian offers the following examples as well:

Real Gross Domestic Product (GDP) expanded by 7.7%, higher than the 4.5% to 6.5% growth projected when the Budget for Financial Year (FY) 2007 was set out in February 2007.

FY2007 Operating Revenue at $39.6 billion has been revised upwards by $7.3 billion (22.5% higher), driven primarily by active property market transactions and higher than expected economic growth in 2007. Higher collections came from Stamp Duty, Corporate Income Tax, Goods and Services Tax, property tax and various fees and charges.

Corporate Income Tax (CIT) collections are estimated at $9.0 billion, or 7.1% higher than the budgeted FY2007 estimates. This was driven by higher profits booked by companies due to strong economic growth in 2006 and 2007.

Personal Income Tax (PIT) collections are estimated at $5.6 billion, or 7.9% higher than the budgeted FY2007 estimates, in line with strong wage growth in 2006 and 2007.

Assets Tax collections are estimated at $2.6 billion, or 23.0% higher than the budgeted FY2007 estimates. This was largely due to the revision of Annual Values to reflect the rise in residential and commercial rents.

Goods and Services Tax (GST) collections are estimated at $6.0 billion, or 23.7% higher than the budgeted FY2007 estimates. This was due to higher than expected consumption growth.

Motor Vehicle Related Taxes and Vehicle Quota Premiums (i.e. receipts from Certificate of Entitlement (COE) premiums) are expected to be higher than budgeted by $0.7 billion. This was attributable to lower rebates paid out with lower deregistration rates and fewer cars with high rebate value.

Stamp Duty collections are estimated at $3.8 billion, 155.0% higher than the budgeted FY2007 estimates. This was due to a buoyant private residential property market, which saw a price increase of 31% and a 60% jump in transaction volume vis-à-vis 2006.

Net Investment Income Contribution (NIIC) for FY2007 is expected to be
$2.3 billion, or $0.3 billion above the budgeted 2007 estimate. This is due to higher interest and dividend income from the investment of the Government’s financial reserves.

While it wouldn’t be fair to expect the government, or anyone, to be perfect in their economic forecasts, nonetheless Singaporeans expect the government to admit its mistakes and take responsibility for them when they are wrong.

Using nice-sounding phrases – “budget bonanza”, “growth dividends” and so on – only obfuscates and do not address the problems which such policies, based on faulty forecasts, create for the average Singaporean.

This is most obvious in the case of the GST hike last July, which even the government admitted has contributed to rising cost and record inflation since then. (Bloomberg, Associated Press)

Branded, non-branded, frozen, unfrozen…

The spiraling cost of living is of great concern to Singaporeans and a real one. The prime minister tried to assuage such fears. He had two particular pieces of advice for Singaporeans.

First, Singaporeans were advised to buy “non-branded” bread on February 4:

“No need to buy branded bread,’ he said in Mandarin to laughter. ‘Bread is bread, rice is rice.” (PM Lee, Feb 4)

The very next day, the local media reported:

“House brands are flying off the shelves.” (Straits Times, Feb 5)

“More households opt for house-brand items to cut grocery bills” (Channel NewsAsia, Feb 5)

Five days later, the PM had new advice on how to cut cost – buy frozen food.

But what you can do is to adjust, go for house brands, maybe go for frozen food instead of fresh food.” (PM Lee, Feb 9)

Right on cue, the media came up with:

“Picking frozen over fresh food could halve your marketing bill” (Straits Times, Feb 13)

“Go for frozen food and cut up to 50% off bill” (Straits Times, Feb 14)

“More Singaporeans buying cheaper frozen food products.” (Channel NewsAsia, Feb 22)

And all the while, Singaporeans had no idea that the government would be reaping a budget “surplus” of $6.45 billion.

What the government could – and should – do

What the government could do and should do with the “surplus” is to give the entire $1.4 billion back to Singaporeans, and not only “60 cents of every extra dollar it collected from the GST hike.” With a “surplus” of $6.45 billion, it would still have $5 billion in its coffers.

The government should also freeze prices of essential goods and services such as electricity (which is adjusted every 3 months), transport fares, healthcare cost, school/tuition fees, etc, which are all within the control of the government.

I hope that MPs will be more critical and think deeper before singing praises of the government in the current budget debate in Parliament.

Else, the ones who will constantly be asked to swallow bitter medicine will be Singaporeans who are already struggling to keep up – while also being told that we are in a “golden era” at the same time.

But that is another story for another day.

“I have to make the adjustments of 2% which I think is fair and I think Singaporeans will support.” (PM Lee, Nov 2006)

So, as the prime minister asked last year:

“Is it better to take your medicine sooner or stretch it out? Take medicine once or two times?”

For me, I’d first make sure the doctor is not a spin doctor.

————————

One last note: I find it really insensitive for the prime minister to be asking Singaporeans to, effectively, scrimp and save by buying non-branded bread and cheaper frozen food, while the government’s investment arms of Temasek and the GIC spend billions on bailing out ailing foreign banks.

In the past year alone, both Temasek and the GIC have spent more than $34 billion on these “investments” – an amount exceeding our entire annual budget itself.

Read blogger Looking For Lalaland’s write up on this: “Please stop lying to us!”

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38 Responses to “Bitter medicine prescription – with a little spin thrown in”

  1. Eveline said

    3.6 million citizens and PRs (source), $6.45 billion in budget surplus. Give every citizen and PR $1 million each and the gahmen will still have plenty left over 🙂

    (I take no credit for this; read this in the IS Magazine.)

  2. Mig29 said

    This is not just a mistake, it is a clear case of sheer incompetence of the current government. This episode has shown that they are definitely not worth their million dollar salaries. If anything, quite a few of them(ministers and high flying civil servants) should be fired straight away.
    The funny thing about this is that they expect to be compensated top private sector rewards but bear none of the risk. This is got to stop.
    The current batch of MPs and ministers seem hopelessly clueless about their present jobs. They do not deserve their present salaries. More than that, they do not deserve or are qualified for their present jobs.

  3. Daniel said

    Andrew,
    the worse thing is that not only those mistake is not acknowledged but instead herald for been ‘wise’ ! Though it’s really nothing new for PAP which always turn all black into white just to save their face.

    Just take a read at the following and everyone will burst with laughter. This obviously doesn’t do his math well, we have more than 8 times excessive surplus, and yet this ‘clown’ think it is good to have over-surplus to prepare for rainy day ( but whose rainy day is it anyway ? The PAP’s propensity to invest in foreign company and in themselves to maximize their own profit ?). Why doesn’t this ‘clown’ propose to increase the GST to 10% in the first place “for your own good”. Whoever this Amy is should be groomed as our next PM ! God bless you !

    “But others, including Hong Kah MP Amy Khor, said the Government should be commended for a job well done. She added: “It is this far-sightedness and prudence, as well as the many timely and astute policies implemented, that have played a major role in bringing about such a large surplus.”
    http://www.todayonline.com/articles/239593.asp

  4. Daniel said

    Who vote this Amy into the parliament in the first place ? Did she says this to the public in the People-session ? What kind of elite is ruling the country anyway who nonchalant to the suffering of the people ?

    Her credential:
    Dr Amy Khor Lean Suan
    Mayor of South West District
    Senior Parliamentary Secretary
    Ministry of the Environment and Water Resources
    MP for Hong Kah GRC (Hong Kah North)
    Vice-Chairman of Hong Kah Town Council

    from http://www.hktc.org.sg/about_mp.htm#a

  5. citizen said

    Said whatever you like, make sure you vote wisely in next election, otherwise nothing is going to change. It’s the same shit with different smell..

  6. Robert HO said

    RH:
    1. OVERTAX & UNDERSPEND.

    2. Govt of Lies, by Lies, for Lies.

    3. Massive and Persistent Falsification of Statistics.

    4. Total Fabrications and Distortions of the Truth by PAPaganda media that shamelessly paints Black as White.

    5. Total Govt UNaccountability and UNtransparency due to No Need for Mandate from Voters because Elections are Unscrupulously and Illegally Rigged [see my blog for proof].

    6. A Third World Govt Unashamedly Working for its own Private Interests [such as world’s highest salaries], with Low Standards of Governance that Persistently and Deliberately Understates Profits in order to Rob and Rape the Helpless People even more, in the process of such Understatements thereby creating Totally Wrong Assumptions and Policies that Hurt the People, especially the Poor and Middle Income, with the Rich [that is, Themselves] not only Unaffected but even Advantaged [such as scrapping Estate Tax and Reduced Taxes on the Rich and Businesses].

    7. We are Ruled by a Totally Dishonest, Unscrupulous, Incompetent, Unelected, Illegal, Selfish, Self-Serving, KLEPTOCRACY which would have long gotten into trouble if not for the Tinyness of our Islet of 42km by 23km of 617 sq km, such Tinyness thereby creating the Efficiencies of the 3Highs [High Density Living = High Efficiencies = High Quality of Life] which thereby camouflage the Gross Incompetence and Third World Operations.

    8. This Kleptocracy, coupled with the Despotism of Central Planning, has resulted in a Sparta that is leaving nothing of note behind, while the Athens of Hongkong is leaving a Rich Legacy of Music, Film, Literature, Cuisine, Dynamism of Businesses, Cultural Achievements, Books, Thoughts and Thinking on a Vast Diversity of Subjects that are making the 7 million people of Hongkong more Creative and Dynamic than even the entire 1.3 billion people of China, which also suffers from the Ills of Central Planning.

    9. It has Resulted in A Sick, Purposeless EXISTENCE in which the Poor and Middle Income Live Lives of Grinding Struggle with Little Graces, while the Rich Equally Live Meaningless Lives of Mere Consumption of Material Goods. This is LIE KY’s “Golden Period”??? Ha, ha, ha!

    10. Thank you, Mr Andrew LOH and TOC, for another brilliant, thought-provoking essay.

  7. SS Lee said

    6.4 billion divided by 3.6 mio gives just shy of S$1,800 for each and every citizen! That is the significance of how much ‘extra’ that should be given out if indeed 100% rebate is the issue. But we digress as the point should be, how much OFF target was the FM in disposing his duties. Did he not know how well the economy was already doing in the middle of ’07 when the man in the streeet ‘protested'(cos’ no real protest took place on Singapore land) against the raising of GST? Giving back so little with added spin is an insult to the intelligence of the people. And to add salt, he can ask us to find cheaper alerternatives?
    A family of 4 can have about $8k for a holiday to Europe or USA given the lower Dollar! Think about that !

    P L E A S E Vote wisely.

  8. […] Says So: The Government Missed By $7,150,000,000. Just Another Honest Mistake – The Online Citizen: Bitter medicine prescription – with a little spin thrown in – Sgpolitics: Parliamentary snapshots (25 and 26 Feb 08) – BothSidesOfTheJohorStraits: […]

  9. Ben said

    Regarding the problem of rising food prices:

    It is deeply-rooted in the fact that Singapore is a not a producer of food such as meat, vegetables and other food products. Singapore should really consider looking into this issue by working closely with the Malaysian government. By playing a bigger role in the MY agriculture or food industries, it has a bargaining chip when trying to stabilize the price of food products in the long term.

  10. Steven said

    Apparently, the spin is not very clever as we all seem to “see through it”. The current team lacks the moral leadership, and that is why we feel further insult when they do speak.

    The other issue beyond their losing touch with living costs (due to their sickeningly high pay) the other bone of contention is their willingness to bail out ailing foreign banks. I agree with Ben that much more could be achieved if we were to invest in securing our food chain.

    We dont need super ministers. Look at how HongKong performed ! No GST, No IRs, no Flyers, NO F1, yet they did well. They announced a budget surplus of 100 billion HKD.

  11. Andrew Loh said

    Daniel,

    It’s almost like deja vu all over again:

    In 2007, PAP MP Fatimah Lateef praised the budget as:

    “Let me share with her (NCMP Sylvia Lim) that nowhere else in the world can you get a Budget which includes love and compassion in abundance as this one.”

    In 2008, PAP MP Ong Ah heng praised the budget as:

    “As Singaporeans, we should feel lucky and be thankful that we have a good Government.”

    And Amy Khor:

    “It is this far-sightedness and prudence, as well as the many timely and astute policies implemented, that have played a major role in bringing about such a large surplus.”

    I can only imagine what Parliament debates would be like if we had say, 20 opposition MPs. For sure, such praises would be ripped to pieces.

    Such praises just shows me the “Great Affective Divide” which Catherine Lim so eloquently spoke about – in 1994.

  12. Andrew Loh said

    Oh, by the way, Ong Ah Heng’s speech is selected as the “Speech Of The Day” by The Straits Times.

    I wonder why…. Hmmmm…..

  13. Dr Syed Alwi said

    Complain as much as you like. But until you have the spine to stand up for your rights or until you vote them out – you will continue to have them lord over you !

  14. sane but powerless said

    So, is there any Opposition Party with gut to call for a mass rally on the First of May 2008?

  15. Gary Teoh said

    All these MPs talk nonsense, give citizen 2 or 3 hundred, talk until generous budget,compassion society, the sulplus is billions of dollars..you just give 2, 3 hundreds,I tell you, we dont want your money, we want to change government.MPs do not reflect our people’s wishes,talk nonsense,want to ‘pang sai, find toilets’lousy MP.Look at H.K, to day’s news, they have surplus more than ours, and the people rejected the goevgnment’s GST proposal in 2006.At least in HK, the government listened to the people.Over here, people have to listen to the government,the MPs “chia sai, not pang sai”

  16. Ben said

    Gary Teoh:

    This is what you can do at the very least: Influence your friends, family, neighbors, colleagues, school mates to vote them out next GE.

  17. Daniel said

    “We dont need super ministers. Look at how HongKong performed ! No GST, No IRs, no Flyers, NO F1, yet they did well. They announced a budget surplus of 100 billion HKD.”

    Moreover, HOng Kong has natural disaster like typhoon, storm but yet come out strong on economic and social well-being.

    Singapore ? One word. Pathetic ! Singapore is lucky not to have natural disaster but this is taken for granted by our expensive coffers. What we have now is MAN/PAP-MADE disaster that the citizen has to pay for. Shameful government who keep lavishing praise on themselves on how world-class they are comparing to Finland, Hong Kong, Malaysia, and other economies.

    It look like the Fake elites are been exposed now.

  18. Mun Kit said

    with regards to the stupid medicine analogy…

    it’s like forcing us to take medicine (GST) when we are healthy and then saying he will give us discount (Growth dividend) when buying the medicine.

  19. Daniel said

    We should demand answer from the original Finance Minister, LHL, not Mr Tharman Shanmugaratnam.

    Overall, I find Tharman among the better ministers who still contributes greatly to society of Singapore, and I did see improvement in education when he is still education minister. Unfortunately, it obviously, in this case, he is made as scrapegoat by the former Finance Minister aka PM.

    Tharman is only been appointed finance minister in December 2007, so before that, LHL had already approved GST hike, and minister’s pay, and hike is underway.
    http://www.pmo.gov.sg/News/Appointment+of+Minister+Tharman+as+Finance+Minister.htm

    As usual, LHL should be responsible and not just throw his own inflicted problem to his ‘successor’ to escape the responsibility and accountability.

    It is not the first time this PM get away, and with many a time asking his own surbordinates to resolve and speak on his behalf. As usual, I won’t be surprised to see the grand-daddy of Singapore,LKY, defending the hike for his son and says ‘Let’s move on’.
    It is the standard Operation Procedure for government that every Singaporean get used to.

  20. Leong Sze Hian said

    Freezefees for basic amenities
    Business Times, The (Singapore) – December 14, 2006
    I REFER to media reports that the government has spelt out the fees to be frozen for one year after the Goods and Services Tax (GST) hike, in fulfilment of its pledge to offset the burden of higher GST.

    Fees not set by the government are excluded from the list as any changes are determined by market or other forces.

    These include utilities charges, polyclinic and hospital charges, phone bills, university fees , HDB flat prices, foreign maid levy, vehicle and road taxes, and service and conservancy fees .

    I find it somewhat puzzling that the excluded list includes polyclinic and hospital fees , foreign maid levy, vehicle and road taxes, and HDB flat prices.

    Are these not under the ministries of health, manpower, transport and national development, respectively?

    Have these fees not always been set by the ministries concerned?

    How have ‘market forces’ ever been the determinant of such fees ?

    Can we have some elaboration as to what are the ‘other forces’ that determine these fees ?

    I find it quite disappointing that most of the fees that will be frozen are not those for basic amenities, and those not frozen are mainly basic necessities which may impact the lower and middle-income more, like polyclinic and hospital charges, university fees , public transport cost, water and electricity bills, telecoms bills, foreign maid levy, etc.

    The explanation that service and conservancy fees are not frozen because these are decided by town councils, is a somewhat weak rationalisation, because aren’t town councils, particularly the GRCs, headed by several Members of Parliament?

    Since there are only two opposition MPs, isn’t all the rest part of the government? LeongSzeHian Singapore

  21. Andrew Loh said

    Sze Hian,

    The just-announced freeze on govt fees this year also repeats what they said last year:

    “Mr Tharman, who was wrapping up the debate on the Budget Statement, said regulatory charges such as those in the transport sector and the development charges in the property market will not be frozen.

    This is because they must continue to serve the purpose of regulating demand.

    Similarly, the freeze has not applied to fees charged by non-government entities such as the universities, restructured hospitals and town councils.

    He explained this is because they have to make their own decisions on whether or not they will raise fees.” (CNA)

    So, it’s the same thing – essentials and necessities’ fees are not freezed.

    Best part is this:

    “However, Mr Tharman acknowledged the concerns many Singaporeans continue to have on rising costs, and he urged the town councils to consider holding their Service and Conservancy Charges unchanged for this year.”

    I am truly appalled that the PAP town councils would even contemplate raising S&C charges. Didn’t we just learned that they have OVER ONE BILLION DOLLARS IN RESERVES ???

    Looks like helping Singaporeans is all a wayang. I am very very disappointed.

  22. sevenleleven said

    if you have include the 33% pay increased immediately after the GST increased and deducted those as expenses, the figures are way higher then the 6.4b. Notice the generosity they had for themselves and to trumpet about the mere hundreds given out as “WELFARE”

  23. AY said

    Just vote them out – bunch of too highly educated but stupid morons in white!!!!

  24. match stick man said

    This is a very nice article. And well researched.

    Good job!!

    I like reading political news from around the world, and I’ve never heard a head of government tell his citizens what bread to eat. This is pathetic. Beyond pathetic.

  25. PZ said

    I believe it the discrepancies to be at least partly the government’s intentional underestimation of our economy so that when the figures come out, we exceed expectations. Nothing really wrong with that.

    And I don’t think that calculating the revenues for these kind of things is easy either. If change in consumption patterns from the rise in GST do not fit that of the government’s expectations, does that mean they’re DIRTY FILTHY LIARS? How often are these estimates, even in other countries, correct anyway?

    Thirdly, go back to economics. A surplus is a withdrawal from the flow of the economy. This means there is a disinflationary effect.

    “One last note: I find it really insensitive for the prime minister to be asking Singaporeans to, effectively, scrimp and save by buying non-branded bread and cheaper frozen food, while the government’s investment arms of Temasek and the GIC spend billions on bailing out ailing foreign banks.”

    And aren’t these investment banks working to contribute to our country’s capital/reserves? So what, because some Singaporeans are having trouble coping with the rising gst/prices, these two investment arms should stop all their normal investment activity? No link, sir.

  26. Daniel said

    Let’s face it, even the surplus of $6.4 billions excess is to hard to believe consider that this government is known to use creative accounting in any way they like without transparency. Dig it hard, and I won’t be surprised to find more than $10 billions in excess.

    Is government stupid to reveal such figure knowing that it will create commotion ? Nope, they probably need to but play it conservatively. Until all their accounts are subjected to public scrutiny, none of coffers, especially self-elected audit body can be trusted to tell the truth.

    In the past, figure such as taxi salary can be quoted publicly by minister and exaggerated without deducting the expense, so how trustworthy can the government’s statistic and figures be behind closed doors and walls ?

    Just moment ago, I am totally appalled too by the news on how the Hong Kong government return the surplus to the people of Hong Kong, and setup scheme to really help the poor without increasing GST or any cost. I hope that someone will post what the Hong Kong government has done to help the poor. One thing is very sure. The HK government neither say that giving too much wellfare will bleed crude mentality nor did they say the surplus should reserved for sovereign wealth fund to help ailing bank and rainy day. That a different between a true democratic country and a fake one.

    Contrast and compare to that of HK government to Singapore government is akin to comparing harvested mango to a long-rotten apple. We really need to compare that to shame our very expensive and arrogant government.

  27. freedom lovin Singaporean said

    it has, by now or long ago, become/been clear that since PAP’s departure from its early socialist policies in the earlier decades, the new agenda of PAP since 90s has been that of neo-classical economics.

    by this agenda, the person who is of value add to economic growth policies, will survive and prosper whereas the person who is of little or no value to economic growth policies will suffer and wither.

    singaporeans obviously know this but do not care much at the ballot. that is why the government can undertake any form of risky or painful or radical or extreme economic growth policies. stop blaming the PAP for this. what singaporeans care when they vote for PAP is that beyond whatever ills that PAP’s policies may bring, they believe there is an eventual goodness for themselves and the country.

    as long as Singaporeans have this faith, they will continue to vote for PAP and PAP itself will continue its neo-classical economic programs which will include uncontrolled price increases, instability in wages, inequalities in income, adverse income redistribution, minimal labour protection etc

  28. Andrew Loh said

    PZ,

    As I said in the article, no one expects the govt – or anyone – to be perfect in their forecasts. But as I also said, when forecasts are so way off the mark, as in this case, the govt should admit their shortcoming and accept their responsibility. Note that the budget deficit/surplus forecast is not the only forecast which is way off the mark.

    Indeed, Mr Tharman in Parliament today has given the undertaking that his ministry will be more accurate in its projections in future.

    As for Temasek and GIC’s investments, in my view, it is a matter of priorities. It is no use spending so much – more than $34 billion within a single year – on so-called investments when citizens are struggling.

    Further, the success of such investments are doubtful and even if they are to reap profits, it will take a long time. Didn’t both Temasek and the GIC say that these are “long term” investments? What happens to the poor and struggling in the meantime? More GST hikes so that they can be helped?

    FYI: Shin profits plummet by 72% for 2007

  29. ronin said

    “This is a Wayang Party, WP, not Workers’ Party…Do they have solutions? Can they bring the price of oil down? Can they stop factories from pulling out of Singapore and find you jobs? Can they bring down the price of rice, a loaf of bread, a cup of coffee? ”

    by Dr Ng Eng Hen
    3rd May 2006, Channel NewsAsia
    ————————————————————

    Can Dr Ng please bring down the price of oil, bring down the price of rice, bring down the price of a loaf of bread, and bring down the price of a cup of coffee NOW???

  30. Mig29 said

    PZ said:
    “And I don’t think that calculating the revenues for these kind of things is easy either. If change in consumption patterns from the rise in GST do not fit that of the government’s expectations, does that mean they’re DIRTY FILTHY LIARS? How often are these estimates, even in other countries, correct anyway?”

    When you are so off the mark in your estimates, it speaks of a couple of possible things:
    1) You are a bunch of dirty filthy liars
    2) You are not lying but incompetent
    3) Both

    It is precisely of people like you that there is an exodus of talented singaporeans from the country every year. I say good luck to such people, people who dig themselves a hole and fall into it while the rest of us laugh.

  31. Gary Teoh said

    Ronin,

    When you talked about that WP by Ng, my temper flared because LHL said those items, government can’t control, so the statement by Ng and LHL contradicts.

    Million dollar ministers like LHL and Ng talked without using brain. If this year is the GE, I think PAP will get 54% down from 66.6%, Our opposition parties should be more proactive like the opposition in our neighbour Malaysia.

  32. Aaron Ng said

    What the government could do and should do with the “surplus” is to give the entire $1.4 billion back to Singaporeans, and not only “60 cents of every extra dollar it collected from the GST hike.” With a “surplus” of $6.45 billion, it would still have $5 billion in its coffers.

    This is a very reasonable suggestion, Andrew. 🙂

  33. aygee said

    I’m just wondering…i live in HK now, and am wondering whether any of the papers in Singapore carry any news about HK’s budget?

    HK just announced its budget yesterday. even during the buildup, the HK govt admitted that they miscalculated their budget, and had a surplus. They immediately talked about what they will do to spend the surplus – on welfare, on public works, schools, etc…and the public (such as unions, NGOs etc) were called to comment and give feedback.

    And yesterday’s final budget was welcomed by everyone – from businesses, to the working class. Because the govt has a lot of money, it is giving tax breaks on nearly every sector (eg hotels), more welfare checks, SMB funds, electricity subsidies, one-off income tax rebates. They are even eliminating alcohol tax except for spirits!!

    The most important thing – i like the way the HK govt owns up to its mistake in underestimating their income, and prepared to spend it back into the city, and how they consult NGOs, academics, unions, etc, on where they should spend.

  34. Dr Syed Alwi said

    Singaporeans deserve this Government ! You either have the courage to stand up for your rights or else forever hold your peace. As for elections – well the system is rigged. GRC’s, walkovers and other tricks ensure victory for you-know-who.

    For me – I admit that I am too scared to protest. But I know that Chee Soon Juan has the guts…so he has my vote !

  35. Expected Analysis said

    Those that are full of praise for the govt’s budget are simply naive and out of touch with reality. The contentious issue here is the timing and necessity to raise the 2% GST.

    It was MADE CLEAR that it was not necessary. “We have to increase the GST when the economy is doing well rather than wait till bad times. The increase was meant to help the lower income group.”

    Therefore, in order to help the lower income group, govt must tax Singaporeans unnecessarily to fund the welfare programmes?

    Surpluses from previous years cannot be touched because they can only be used for investments?

    Returns from investments are used for further investments perpetually and therefore, non-returnable?

    For which generation of Singaporeans are these investments suppose to cater for?

    Accumulate more surpluses at Singaporeans’ expense in order to make the govt look good, justify the ministers’ astronomical pay and at the same time, rewarding them with fat bonuses for the “unexpected” collections?

    Freeze govt fees till end of 2008 when most if not all have been increased?

    Those MPs who were full of praises are simply gunning for higher office. If ever any of them gets promoted, Singaporeans will really have to dig their own graves.

    Govt’s help policy is to help lower income Singaporeans to their graves earlier.

    Imagine a helpless man struggling in the water. A nearby lifeguard saw him but stay put in his position. The man shouted, “Help! Help! I can’t swim! Help……………..” The lifeguard replied, “Learn to swim! I’ll come to you only when you really can’t!”

    “人快饿死了才问人饿吗!”
    (To ask whether one is hungry when one is dying from hunger!)

  36. Adrian said

    Do think about all these events carefully when you next vote. I am personlly not pleased with the high-handness of how our government conducts itself and talk down to the people, telling us how lucky we are to have such a good government like them. HK is a clear example that you need not pay high salaries to get good people to serve the country and their willingness to admit their oversight in budget estimates will only win the hearts of its people. Well at least I have no regrets in NOT VOTING for Lee Hisen Loong when he was out there in AMK MRT shaking people’s hands in the last GE.

    Back then, my folks asked me how come you never vote for PM Lee, i replied that parliament has been dissolved and Lee Hisen Loong is NOT Prime Minister until his party wins the majority and forms the next government.

  37. Daniel said

    “Surpluses from previous years cannot be touched because they can only be used for investments?”

    The kind of excuses and lame reasons given is what make our venerable ex-president angst over PAP government when he uncovered something wrong on the accounting and he demand more power to president.

    Does most of annual surplus actually quickly go into Temasek and GLC’s fund so that a budget deficit can be quickly announced to create more surplus ? Remember what goes into those investment fund is government’s secret. If the government ever get dismantled, we can find how ‘honest’ and ‘credible’ our so-called ‘esteem’ government is. Definitely smell a scandal even larger than Edison Chen.

    So how is the hell that such a important terrorist can escape given that he is limp ? Does that not coincide with commotion by the public asking for accountability on the GST hike ? Is this merely distraction to ‘move on’ to the topics of capturing the terrorist ?

    We can’t help but smell a dead rat.

  38. Daniel said

    The president I refer to is
    Ong Teng Cheong. He should be called the true leader of Singapore, not the pathetic counterpart that forces media and books to portray him as hero.
    http://www.singapore-window.org/sw99/90730aw.htm

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