Why PAP MPs are no more but a “wayang” in Parliament

By Richard Lu

I refer to Miss Chua Mui Hoong’s article ‘No wayang – MPs serve as early warning system’ filed under ‘From the Gallery’ section of the Straits Times of 12 March, 2010. 

This article is a shaggy dog story.  In it Miss Chua says “MPs play a valuable role in the political process, often as an early warning system on issues simmering on the ground but not yet on the national radar.”

I beg to differ.

 

ROLE OF MPs IN PARLIAMENT

The main functions of Parliament are lawmaking, controlling the nation’s finances, and ensuring ministerial accountability.  By and large, it is the cabinet ministers and the public servants who have direct responsibility for drafting new legislation.

MPs can influence the Government policy by participating in debates in the House and in the Committees where new legislations are being formulated and thereby contributing both substantively and fine-tuning amendments.  MPs sit in Committees where Government spending is discussed.  They also lobby the ministers.   MPs can also introduce ‘private members bills’. Opposition MPs use Question Time in the House to raise issues of concern and bring them to the attention of the public.

 

SINGAPORE MPs IN PARLIAMENT

MPs are the eyes and the ears of the people.  They are voted into Parliament for this purpose and more.  In Singapore, 82 of the 84 seats in Parliament belong to the PAP.   Because of their overwhelming majority in the House for such a long time – 51 years, the PAP MPs have gone ‘soft’ and lazy and are relatively ineffectual.  One only has to watch a session of a Parliamentary debate on TV to be convinced. 

The debates are basically dour and docile affairs presented without much detailed research and barest of details.  MPs cannot articulate and there is a distinct lack of flair, aplomb (lacking self-confidence) and passion.  The ‘cut and thrust’ of debate or ‘off the cuff’ rebuttals and ‘humoring’ of fellow Parliamentarians are largely absent.   Too gentlemanly.  

MPs rely heavily on their scripted text and reading.  Their ‘theatrics’ or ‘wayang’ – prepared questions and answers meant to praise or polish the ‘marbles’ of the ministers are too prevalent in these debates. But in the main, the abysmal quality of debates is reflective of the “poor quality” of the MPs’ persona (many having entered the House courtesy of the open “back door”).  

Like the quintessential or arch-type Singaporean, these PAP MPs too are afraid to speak up for fear of retribution (or being dropped) and always want someone else to lead.   Hence the “wayang” i.e. questions and answers prepared before hand as evidenced by the scripted text.

Maybe it is the “corruption” of the high MP allowances that keeps these PAP MPs in check – the pervasive “don’t rock the boat” and the “better to keep your mouth closed and be thought a fool than to open it and remove all doubt” attitudes. 

In the last session, the PAP MPs raised mundane, unexciting and inconsequential issues like cyclists on the pavements, number of steps on overhead bridges (good God, she can count – and up to 67!) and lifts.  There was even a nonsensical question raised by a doctor MP asking the Minister of Health how he stays looking young.  If this doctor does not know, who would?   Many suspect he was merely “marble” polishing.

In the meantime, look at what had happened in Singapore under the MPs’ national radar that had escaped their attention entirely:

1.  PRs buying up HDB flats and prices going up to the detriment of Singaporeans;

2.  Foreigners imported in Singapore in such alarming numbers (3.6 million) and such fast rate;

3.  The fast tracking and making of PRs and citizens;

4.  Demand of private homes hitting the roof and these MPs still do not see the bubble being formed;

5.  Hospitals and hospices are inadequate;

6.  The productivity of the Singaporean workers has dropped and the MPs are not even aware;

7.  Older Singaporeans out of jobs due to cheaper, faster and better foreigners;

8.   The MRT & buses are choked ;

9.   Unsavory behavior of our foreign imports;

10.   Stagnant incomes, lower purchasing power, lower quality of life, etc.

The above are just some bread-and-butter issues tugging the heart-strings of Singaporeans that our MPs are so oblivious to.  It was left to the vigilant netizens who relentless pursued and cajoled the Government in their postings and the 2 vs. 82 opposition MPs who championed these concerns and raised them in Parliament. 

 

AN EXAMPLE OF THE PAP MP ROT

PAP’s Baey Yam Keng, a ‘back-door’ MP in MM Lee’s GRC, must surely take the cake.  In a ‘Meet The People’ session in his Tanjong Pagar constituency at the end of last month, Mr. Baey promised to raise residents’ concerns in Parliament to ‘change’ government policies.  Doesn’t he know that this is his basic and sacred duty as a MP?  Has he been sleeping all this while? 

He did stutter and splutter last week despite reading from a prepared scripted text.  And what of the ‘residents’ concerns’ did this joker raised in Parliament?  Setting up a food museum!  How does MM Lee tolerate such fools?  This Minister Mentor is surely not doing his job!  MM Lee is NOT even mentoring his charges in his own GRC.  Or rather, has he given up as a consequence such low quality inputs?   

Where then is the early warning system, Mui Hoong?  And look at what were also debated in Parliament recently:

a.   $10 million to help migrants integrate;

b.   Migrants need not perform NS or they may not want Singapore citizenships;

c.   Migrants to join People’s Association;

d.   Foreign workers are necessary for Singapore;

e.   HDB flats are affordable;

f.   Even Ministers asking Singaporeans to be “more realistic” over HDB flats and being tolerant to foreigners.

The old maxim “pay peanuts and get monkeys” is reversed here in the Singapore Parliament. Singaporeans pay TOP DOLLARS for monkey PAP MPs. 

 

FAILURE OF PAP MPs

May I ask Miss Chua Mui Hoong how then do these MPs play a valuable role in the political process and more importantly how do they justify their shameless monthly MP allowances? 

In 1990, the Nominated Member of Parliament scheme was introduced.   Wong Kan Seng, DPM and Minister for Home Affairs and the then-House Leader, gave a reason for the scheme – the performance of the opposition MPs (there were four at that time) had been disappointing.   But I suspect he too was of the opinion that the PAP MPs were as just as guilty of this fact.  

Save for the former PAP backbencher Dr, Tan Cheng Bock and now Mr. Inderjit Singh, most of the other PAP MPs must either be from the mute association or the deaf association. 

Some of the NMPs, Siew Kum Hong and Chia Shih Teck in particular provided spirited debates.  But alas, their terms were not extended leading one to enquire if the Government was sincere in wanting diverse views or once again merely paying lip service. 

Singaporeans are such simpletons and imbeciles that MPs can be easily milk them for their astronomical MP allowances and Ministerial pay!  It is just taking candies from babies.  And we will vote them in again come next election!  

Even Abe Lincoln would have approved of this:

“You can fool some of the people some of the time, but you can fool Singaporeans all of the time.”

 

JOURNALISM IN SINGAPORE

Like Rachel Chang, Miss Chua Mui Hoong too is doing ‘her ‘wayang’ …….. playing the tune for their political master and employer.  Like good pets, they bark or bite when told to do so.  Journalism in Singapore is dead.

My recommendation for Rachel, Mui Hoong, Main Stream Media journalists, reporters and presenters, are to embrace these 2 aspects for good journalism – i.e. journalist skills and journalistic principles. 

a.   5 journalistic skills – curiosity, sense of adventure, need to share, joy of storytelling and making a difference.

b.   5 basic journalistic principles – accuracy, thoroughness, fairness, transparency, and independence.

Otherwise quit journalism.

 

CONCLUSION

Parliament is becoming a farce if not an outright “wayang” thanks to these non-performing, ineffectual and lackluster PAP MPs who are there simply as dummies to fill up the empty seats.

As PAP’s omnipresent octogenarian “Dear Leader’ Lee Kuan Yew puts it succinctly:

“To be the prime minister, you don’t have to know every instrument, but you got to recognise, ah, he’s a good violinist, he’ll be the first violinist, he’ll be the double bass. He will play the viola, he will have the trumpet, he will do the drums. Then you coordinate them and then you have great music. And if you already have a great orchestra, you can put a dummy there and you still got great music.”

[Source: Channel News Asia, 5 March 2008]

PAP MPs have failed miserably in their responsibilities to speak up for Singaporeans, let alone be an “early warning system.” They do not deserve a single cent of the $13,000 monthly MP allowance that taxpayers have been paying.

A real “wayang kulit” will be much worthwhile watching than the pathetic “wayang” these PAP MPs put up in Parliament to masequerade Singapore as a “democracy” to the world.

 

Read also:

10 most unforgettable quotes by PAP MPs in the recent parliamentary debates

 

Other articles by Richard Lu:

1. Independent judiciary in a liberal democracy

2. Why an independent judiciary is an important part of a liberal democracy

3. Advantages of an open and democratic society

‘Not realistic’ for GIC to avoid making any losses?

Dear Mrs Lim,
 
I refer to your comments in parliament as reported by Straits Times on 10 Mar 2010.
 
Your said it is not realistic to avoid losses on every investment (that GIC makes).  But that is not the issue at hand.  The issue is the magnitude of those losses versus the supposed talent that GIC has.  What value are we getting from these so-called talents for the millions they are paid versus the billions they have lost?  How much worse would a school boy fare throwing darts to pick investment alternatives?
 
You said the GIC will not be judged on individual deals but on overall performance.  But individual deals do affect overall performance.  If we don’t improve on individual deals, especially the spectacularly bad ones, it means we are not getting the best overall performance we should be getting.  The stakes in the financial market are ever higher now and a lot more devastating too.  The Barings Bank is one good example of how individual bad deals can bring down an entire financial institution with centuries of history behind it.  Surely we would not want individual bad deals to wipe out our nation’s golden goose?
 
We cannot accept the so-called creditable returns by GIC and Temasek over the long term without the means to actually verify them thoroughly given the lack of detailed information concerning their investments.  This is perhaps the reason why we are left to criticise individual spectacular losses given their ascertainableness.
 
Mr Singh’s suggestion that it is timely for the GIC and Temasek adopt a more conservative mandate should not be construed to mean an immediate, knee-jerk reaction to the recent downturn but a timely reminder that their role is to protect the nation’s golden goose and not to endanger it regardless of what courses of action they might undertake at the moment.
 
 
Thank you
 
 
Ng Kok Lim

A lady’s take on the Jack Neo scandal: What a Jack-Ass Jack Neo is

By Novia Lim

A jackass is a male donkey. From Wikipedia: In Arabic, حمار (ḥimar), meaning “donkey”, is a derogatory term that refers to someone of very limited intelligence.

In United States, the world had revealed Tiger Woods. In Singapore, we have our very own jackass (donkey) AKA Jack Neo.

A cultural medallion winner, comedian, actor, director, and a local sensation in many other entertainment industry related accolades and achievements. It speaks for itself reflecting that Jack Neo is NOT a person of limited intelligence. Jack Neo is married to Madam Irene Kng for 27 years and has four lovely children, how can Jack Neo commit infidelity against monogamous marriage?

David Buss, professor of psychology at the University of Texas reported that men crave sexual “variety.” Or could it be the primitive instinct that dates back to stone age where men are hunters and gatherers – only this time, they’re craving, hunting and gathering new women? 

Madam Irene Kng, composed and supportive, walked in hand in hand with Jack Neo at the news conference on 11th March 2010. Madam Irene Kng expressed her graceful forgiveness and stood by Jack Neo.

What if the scenario is now reversed? Will Jack Neo reciprocate the same level of support? I mean no disrespect to Madam Irene Kng and I sincerely admire Madam Irene Kng for her bravery, tolerance and love for her family.

Should men or women get a free pass if their significant other cheats on them? In marital problems such as infidelity, reports have shown that women are more likely than men to forgive a cheating spouse, as they are more emotional and take into account their children and general survival.

Men are just crushed and experience extreme anger over what happened to them and appears to be less willing to forgive. Are women providing too much leeway to cheating husbands?

Madam Irene Kng had displayed generosity towards her family and magnificent devotion towards maintaining a healthy family nucleus. I am sure not all of us (including myself) will forgive the mistakes that Jack Neo had committed. But I strongly believe that we should give Madam Irene Kng and their four lovely children our support and blessings.

The reasons for infidelity could be endless. Every individual and every family is different. We all have our own stories, struggles and happiness. May it be evolution, human nature or simple novelty, it is not rocket science technology and the decision on whether to cheat is still entirely in a person’s control.

Are you in control?

 

About the Author:

Novia Lim is a global data analyst by profession, honored with years of solid experience with multinational corporations. She is also a hobbyist model and food blogger striving to achieve lifestyle balance with proper prioritization between career, demands of life on one hand and pleasure, leisure on the other.

Novia blogs at http://eatcookshoot.blogspot.com

Why Gopalan Nair is wrong

By Bhaskaran Kunju

A week ago I wrote an article titled, “The Iceman Cometh”. It was on the role of foreigners in Singapore’s domestic affairs. In it I discussed the merits and demerits of the involvement of foreigners in Singapore’s local politics.

On Sunday night, just like everyone else I was surprised to hear of the news of Minister Mentor Lee Kuan Yew’s apparent ‘massive heart attack’.  For a report that painted a rather grim picture of the state of MM Lee, it seemed too isolated. There weren’t any other news reports of the incident and what was written was completely unsubstantiated to begin with.

In Gopalan Nair’s article, there was information of supposed uprisings and demonstrations in parts of Singapore that was mentioned with specifics, as well as other details that bordered on absurdity. But the news still spread despite the shortcomings.

In that small 24-hour window, the topic was widely discussed (with much skepticism) in several online forums and even received a significant number of Tweets across the country.

With the absence of Prime Minster Lee Hsien Loong from the Parliamentary session earlier in the week, the facts seemed to correlate and it did seem that perhaps the core of the report might have been true. So the mini-frenzy that followed was only natural.

Concern, the sourcing of further information, outpouring of shock, the spreading of news – these are all observable traits of ANY newsworthy event, and the hospitalisation of an elder statesman is no different. Occurring in an authoritarian or a democratic state adds little difference to the outcome.

It wasn’t mass panic akin to a Stalinist nation keeling over upon losing its head, as Mr Nair would like to fool himself into believing. The news spread simply because it was compelling. However tainted Mr Nair’s record may be in Singapore, he still had a relatively significant voice as an opposition of the ruling government and his words carried some weight.

But in choosing to perpetrate a lie, he has simply proven himself to be a ranting sideshow jester with little to do than hurt his own credibility and that of the online news media by pulling immature pranks.

If it was attention that Mr Nair was seeking then he has most certainly received it. It’s just that it is anything but affable.

Generally it has been nothing but backlash for the self exiled lawyer. But unusually, the comments on his blog appearing after Sunday night are contrary to what everyone else thinks. Instead there are plenty of anonymous praises for his stunt.

This mystery is solved if you do try posting a negative comment about his actions on his blog. He simply doesn’t approve it. So for a man who has been championing freedom of speech, he prefers the freedom to be one way. His way.

As someone who has taken the easy way out and left the country, and taken up citizenship in the U.S., it is irresponsible of him to distress Singaporeans when he knows very well that the delusional doomsday scenario he had theorised for post-MM Lee Singapore, will not affect him in any way.

It is disappointing that he is engaging in lowbrow tactics of deceit and manipulation that causes more harm and disillusionment than the very act of suppression of opposition voices. It takes away credibility from under the feet of alternative voice as a whole.

His own thoughtless and selfish act has repercussions that extend beyond him. But ultimately it is Mr Nair who has thrown away his last shred of support together with his reputation.

Back in 2001 when James Gomes was part of Think Centre, the independent non-governmental organisation (NGO) for promoting an active civil society in Singapore, he and the organinsation were involved in a similar but relatively harmless hoax, as a stunt for April Fool’s Day.

A press release was issued by Think Centre that announced the organisation’s intent on fielding candidates, which included James Gomes, for the 2001 General Elections in the Jalan Besar GRC. The news was of course taken seriously, and even drew response from then Deputy Prime Minister Lee Hsien Loong who commented that the group would have had their background scrutinised.

The joke eventually found the group running into trouble with international news agency, Agence France Press (AFP), whose editor took offence at having been duped. But the damage from this simple hoax had far greater consequences and would attach itself to James Gomez who found himself under scrutiny later that year.

Just over 6 months after the hoax, Mr Gomez decided to genuinely stand for elections in the 2001 General Elections as part of the Worker’s Party GRC team in Aljunied. On Nomination Day however the group’s application was rejected on technical grounds. They had omitted the name of the constituency they were intending to contest in the application forms.

The failure to see his application through, coupled with the hoax from 6 months prior made Mr Gomez an easy target to take potshots at. Newspapers drew parallels and then Prime Minster Goh Chok Tong questioned the credibility and seriousness of Mr Gomez’s, and by affiliation his party member’s, ambitions. In an unrelated press conference he stated, “I don’t know the whole story but I found the whole team was disqualified. I don’t know if it’s another of those April Fool’s jokes.”

It was that loss of credibility that came back to haunt him in the 2006 General Elections when an issue over a missing minority-race candidate form placed him the spotlight yet again.

Needless to say such an incident should have sunk the Worker’s Party’s campaign altogether in 2006. However the fervent pursuit of the matter by the PAP in the media, which left the public disillusioned by the perceived pettiness of the issue, inadvertently saved and boosted the Worker’s Party’s campaign.

In the instance of Mr Nair’s hoax however, the fallout and the resulting criticism has fortunately stuck to him and him alone. Even though just like the case of James Gomez, it could have easily affected the credibility of those he shares his domain with – the online news media. The damage has been averted since most news sites and netizens have refused to endorse his actions.

It is heartening to note that netizens and other online news sites have distanced themselves from him and his questionable actions. For all the criticism that this medium has received for supposedly propagating extremist views, it has provided a fine rebuttal by drawing the line between responsible criticism and irresponsible dissent. Perhaps Mr Nair’s tragedy has a silver lining after all.

There are some quarters of the public who still believe that there might be some truth to Mr Nair’s claims. Especially since no official clarification or statements were released regarding the health of MM Lee.

There won’t be any official clarification because it only lends credence to such acts of rumour mongering and ultimately will only encourage more from being perpetrated. You simply don’t engage rumours or gossips because it drags you down to the depths of those who choose to indulge in it.

On his last update on his blog, Mr Nair has decided to include another faux story on MM Lee but with a disclaimer this time that it is a joke. The only running joke here however is Mr Nair himself.

 

Copyright © The Temasek Review, 2009

Other articles by Bhaskaran Kunju:

>> The Iceman cometh: The role of foreigners in Singapore

>> A rebuttal to Vikram Khanna’s article on need for foreign workers

>> How much immunity for a diplomat

>> The saga of (dethroned) beauty queen Ris Low

>> Is there room for more foreigners in Singapore?

>> Why social cohesion is at the forefront of the Prime Minister’s National Day Rally

>> Changes in political system to allow more alternative voices

>> The untimely departure of Chip Goodyear

>> Should universities be re-politicized?

About Author:

Bhaskaran Kunju is a Political Science and Communications and New Media undergraduate at the National University of Singapore. He is a regular contributor to the Straits Times Forum and TODAY Voices. He also writes for NLB and FAS and hopes to be a full-time journalist.

Why Lee Kuan Yew is not the father of modern Singapore

Dear Mr Sam Tan (MP for Tanjong Pagar GRC),
 
I refer to your comments in parliament as reported by Straits Times on 5 Mar 2010.
 
You quoted Mr Otto Fong as saying that Lee Kuan Yew is the father of modern Singapore and that Singaporeans are his children. 

MM Lee has referred to Singaporeans as descendents of peasants and as (working animals) whose spurs are not stuck deep enough in the hide.  Contrast this with what MM has to say about his eldest son: considerable intelligence; as good as his generation of leaders. 

The stark contrast clearly shows that MM doesn’t treat us like his children, neither should we treat him as our father.  We have no such father who belittles us as though we are mere workers and slaves.
 
Throughout our formative years as a new nation, it was Goh Keng Swee who steered our economy under the guidance of Dr Albert Winsemius. 

With or without Lee Kuan Yew, Singapore would have succeeded given the strength of its people, the strong foundations laid by the British and the good steering of Dr Goh and Dr Winsemius.  It would be difficult to credit someone as our founding father for merely sitting on the throne.
 
While Otto has wisened up to the truth that his future rests with himself, there is no evidence that he has come to terms with his difficult youth and childhood. 

Particularly, does he still blame his father Mr Fong Swee Suan and MM Lee for the difficulties he had while growing up?  If so, what exactly should he blame his father and MM Lee for?
 
In the case of his father, the only thing Otto can blame is the fact that his father lost, not his father’s convictions and determination.  He needs to understand that no one should be blamed for having tried and lost, only for not trying.
 
In the case of MM Lee, Otto needs to understand that his father and countless others were arrested without trial and incarcerated for extremely long periods of time despite the lack of irrefutable proof that they were communists as MM had made them out to be. 

If there is anything Otto should blame, it would be the fundamentally wrong and grossly unfair treatment of the losers in the political battle for Singapore.
 
 
 
Thank you
 
 
Ng Kok Lim

Appropriateness and integrity in the use of government statistics

By Edmund Khor

In the recent Budget speech 2010, the Finance Minister Tharman Shanmugaratnam claimed that the lax foreign workers policy had reduced unemployment and raised wages for Singaporeans. He said the huge influx of foreign workers had enabled the median income per household member to rise significantly for the four years from 2005 to 2008. Median income grew by 20%, adjusted for inflation.

Minister Tharman added that lower income households also saw their incomes rise which took place over the three years from 2006 to 2008 – when their incomes grew by about 16% in real terms. They ended with total growth of incomes of about 7% in real terms over the 10 year period from 2000 to 2009. 

Based on the simple observation that “the three years from 2006 to 2008 in which wages showed healthy growth for our lower income families corresponded to the period when the foreign workforce was growing most rapidly”, the Finance Minister claimed that the foreign workers policy had raised wages for Singaporeans.

This brings to mind the Progress Report of the Ministerial Committee on Low Wage Workers released in June 2009. In that report, the high-level committee claimed that low wage workers have seen increase in their wages. It suggested that monthly wage for the 20th percentile employed resident had seen a 9.2% increase in monthly wage from $1,200 in 2006 to $1,310 in 2008.

However, the claim was soundly debunked by netcitizens[1]. The reported monthly wages were in nominal terms, i.e. they were not adjusted for increases in the prices of goods and services over the two year period. Using the inflation rate of 9.5% experienced by the lowest 20% income group, low wage workers were in fact worse off in real income terms.

One cannot help but notice the two different statistics used in measuring the income of Singaporean workers in the two government reports. It is most puzzling why the Finance Minister chose to use average income per (working and non-working) household member as a proxy for wages for working Singaporeans when there are far more appropriate statistical data available.

Even if we were to choose to give Minister Tharman the benefit of the doubt, the statistics used could not convince that there is definite rise in the living standards of the median Singaporean citizen. Two points were aptly provided by the Reform Party in its Response to the Singapore Budget, 2010[2].

Firstly, the definition of residents includes PRs and not just citizens though the minister talked about Singaporean households. Over the past decade the resident population grew by 15% while the resident labour force grew by approximately 25%. This was undoubtedly due to the surge in new citizens and PRs as a result of the government’s liberal immigration policies. The majority of these new residents did not have dependents (hence the much faster rise in the resident labour force than the resident population) and all of them would have had jobs so the proportion of working adults in the average resident household would have risen. As a result we would have seen an increase in real median income per household member without any real increase in the median incomes of Singaporean citizens.

Secondly, the Minister’s figure excludes households consisting solely of non-working persons over 60. If their incomes fell during this period or their numbers increased as a proportion of total households), due not only to the aging population but also because of the diminished employment opportunities for senior citizens as a result of the government’s open-door foreign worker policy, then excluding this group would distort the figure for median income per household member and make it look better than it really is.

Finally, Correlation does not imply causation. It is spurious to suggest the high growth in foreign labour force increased the wages of Singaporeans simply from the correlation between the two variables. As we know, our exported-orientated economy is highly leveraged to the global economic environment.  The exogenous factor we all know is the higher external demand which resulted in increased demand for labour resources in the Singapore economy. Wage increases would have been higher had it not for the lax foreign labour policy which capped the wages of lower-end and middle-level Singaporean workers.

In the progress report of the Ministerial Committee on Low Wage Workers mentioned earlier, it glaringly failed to take into account the impact inflation on nominal earnings. This and the inappropriate statistics used in the Budget speech call into some serious questions on the misleading use of government statistics, which may misrepresent the situation on the ground to Singaporeans.

The Chief Statistician and the Singapore Department of Statistics, as our national statistical authority, must be allowed to adhere to their professional ethics and to voice out against any misrepresentation from the inappropriate use of statistical data by government leaders for political gains. This will prevent further undermine in the confidence of Singaporeans in our government statistical data.
——————————————————————————–

[1] see http://www.temasekreview.com/2009/06/10/are-the-low-wage-workers-really-better-off/

 

[2] See http://www.thereformparty.net/index.php?option=com_content&view=article&id=71%3Areform-party-response-to-the-singapore-budget-2010&catid=11%3Aperspectives&Itemid=44&lang=en

 

Other articles by Edmund Khor:

1. Are low wage workers really better off?

2. Temasek outperforms?

Mah’s story is also Singapore’s story?

Dear Madam Low,
 
I refer to your Straits Times letter dated 8 Mar 2010.
 
I understand your empathy for Mr Mah since both of you grew up in very overcrowded conditions.  However, you need to understand that the improvement in each family’s living conditions over the years is not just a matter of studying hard and working hard but more importantly of diminishing family sizes encouraged in no small part by our “stop at two” policy.
 
The supposed Singapore story of studying hard and working hard to pull ourselves out of poverty is no different from the stories in other East Asian societies. 

Studying hard is not the sole premise of Singaporeans, it is the premise of East Asians in general.  Furthermore, Mr Mah’s success is fundamentally different from those of Bill Gates and Steve Jobs since Mr Mah merely took over the reins of an already successful organisation whereas Bill Gates and Steve Jobs created something out of nothing. 

In other words, it really didn’t matter whether we had Mr Mah or not, his existence as far as the HDB or Singapore is concerned, is non-essential.  Bill Gates and Steve Jobs on the other hand are essential without which there would have been no Microsoft or Apple respectively.  Therefore, Mr Mah’s story is far from Singapore’s story since the former created nothing as far as the latter is concerned.  Mr Mah builds flats that are smaller, far from the city centre that took longer to build and are a lot more expensive.  His ’success’ turned out to be the sorrow and nightmare for many Singaporeans.
 
It is not enough to remind the younger generation of where we come from.  It is more important to let them understand that in an increasingly competitive world, it is not enough to simply ace one’s exams just so as to win a privileged seat to rot in.  Being in a privileged position calls for a sense of duty to fellow Singaporeans, to create something for the benefit of all.
 
So while you give thanks to Singapore for living in a maisonette today, think about who you would thank if you were to start all over again by drawing today’s starting salary and paying today’s price for a maisonette.  I can guarantee you, your tears will be no less than those you shed for Mr Mah last Saturday which you have no one else but Mr Mah to thank for.
 
 
Thank you
 
 
Ng Kok Lim

Prudential – AIA deal: A deal of epic proportions

By Damon Yeo

Two international brands which Singaporeans will be familiar with are to become one very soon, after Prudential PLC agreed to buy AIA (Asian insurance arm of AIG) for a whooping US$35.5 billion. The deal is a direct aftermath of financial crisis over the past few years and will change the face of the insurance industry forever.

Background

Before the financial crisis in 2007, American Insurance Group (AIG) was the by far the largest underwriter of commercial and industrial insurance in America and has an unrivalled presence in Asia (ex-China).

All these changed on 16 September 2008. The Group suffered a credit rating downgrade and overnight it was required to post huge amounts of collaterals. It did not have enough cash reserves to do so and it immediately faced the threat of bankruptcy.

The United States Federal Reserve Bank (Fed) considered the possible impact of the meltdown of AIG and decided to rescue it with a US$85 billion loan, just days after deciding to let investment bank Lehman Brothers die a natural death.

Soon after that, AIG’s financial woes had become clear. Prior to 2008, it had begun to dabble in the high-risk-high-return business of monoline insurance, where they underwrote insurance on risky and complex credit-linked financial structures. By Sept 2008, banks and investors who had bought insurance from AIG had begun making multi-billion claims from the insurer whose cash reserves are running thin. Financial Armageddon happened and AIG needed to be saved.

With AIG being technically nationalised, the Fed’s long term plan for it was to wind it down over time and sell off parts of it to recover the amount of bailout.

AIA was the most lucrative piece of business owned by AIG. Since early 2009, there had been speculation that AIG had planned for an initial public offering (IPO) for this Asian unit but it was always clear that Prudential PLC, a rival British insurer, was interested. This announcement concluded a negotiation process which had lasted almost a year where there was much haggling over the price Prudential will pay.

The acquisition in numbers

The amount Prudential had to pay AIG is quite staggering. On the day the deal was announced, Prudential’s market capital was just above £15 billion. This is just two-third of the amount which they are expected to pay AIG.

To raise that cash, the British insurer is expected to undertake a rights issue to raise £20 billion (the rest will be paid to AIG in terms of securities). There are already reports that Prudential might approach Temasek Holdings to support this fund raising exercise.[1] If Temasek decides to step in, it will become a shareholder of Prudential. GIC already holds a 0.5% of the British insurer.

And if this rights issue is carried out as planned, it will be the largest UK fund-raising ever.

AIA has approximately 320,000 agents and 24,000 employees in the Asia-Pacific region and this deal will absorb all of them under Prudential umbrella. AIA has 23 million in-force life policies, all of which will be transferred to Prudential as well.

The new business is expected to shift the Group’s profits from Asia from 46% to 88% – realigning Prudential’s geographical focus almost entirely.

The impact

British economy

Interestingly, since the announcement of this deal, Prudential’s shares had fallen 18%, wiping almost £2 billion off its market capitalisation. The market certainly expressed pessimism on this deal. Part of this is probably because of the failures of previous multi-billion takeovers, like that of RBS over ABN-Amro.

Over the same period of time, the British Pound fell to new lows against the US dollars as investors expect a significant future outflow of Pound to purchase dollars for this deal.

On a side note, this takeover by Prudential is actually a refreshing change for British companies on the whole. Over the past decade or so, traditional British companies and brands had been sold to overseas buyers, including the likes of Jaguar, Lotus, Manchester United and more recently, Cadbury. However, with the British financial institutions, they had been gobbling up overseas businesses. This deal will further accelerate the shift of focus of the British economy to financial services and away from manufacturing.

Singaporeans

For policy holders of both insurers, change is unlikely to come overnight. As with most other massive takeovers, rebranding will come slowly. In the near future, consumers will still likely to see the presence of two different insurance brands. AIA, despite all the woes of its parent company, is still a strong brand name in Asia, with almost 90 years of history. Prudential may decide to keep it and operate it as a standalone, like how DBS had managed POSB to date.

The bigger change in store is probably for the ten thousand or so Singaporeans whose livelihoods are linked to either insurer. According to statistics, there are about 3,500 Prudential Financial Consultants and 4,000 from AIA operating in Singapore. TR had managed to speak to a couple of them but it appears that even to them, the plans for the merger are not crystal clear at the moment.

Kelvin, 29, who has been with AIA for over 8 years told us, “What we heard about this deal is from the media. There has not been much information from management. We were told that it is ‘business as usual’.”

It is probably fair to say that details of how the merger will work for Consultants like Kelvin is still not being finalised. As with many mergers, the finishing touches on the realignment of ground operations may take years to complete. However, what are always inevitable in mergers are overlaps and redundancies, especially for non-sales staff of the insurers.

Note: Do you work for Prudential / AIA? Are you a policy holder of either insurer? What do you think of this deal? We will like to hear from you so do leave us comments.

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[1] http://online.wsj.com/article/BT-CO-20100303-703828.html?mod=WSJ_Deals_LEFTLatestHeadlines

About the Author Damon is a proud graduate of Nanyang Technological University with a degree in Accountancy. He is currently working in the finance department of a UK Bank.

Ng Kok Lim debunks Mah Bow Tan’s “myths” about HDB flats

Dear Mr Mah,

I refer to your comments in parliament as reported by Straits Times on 6 Mar 2010.

There are not enough HDB flats to meet demand

You said it is a myth that there are not enough HDB flats to meet demand because the 13,500 flats built last year and the 12,000 flats to be built this year add up to be more than the approximately 23,000 flats in either Clementi or Jurong East.  However, the 23,000 flats in either Clementi or Jurong East do not represent the demand for new flats.  Ms Chua Mui Hoong reported in her Straits Times commentary on 11 Feb 2010 that there is a potential demand for 95,600 flats over and above those who have already clinched their flats or will be buying other properties.  This demand for 95,600 flats far outstrips your supply of either 13,500 or 12,000 flats.  Hence, it is not a myth but a truth that there aren’t enough flats to satisfy demand.

You said that the massive oversubscription of new flats is misleading because many applicants eventually reject the flats they were invited to buy.  While it is true that applicants who reject flats available to them do not want those flats, it doesn’t mean that they don’t want a flat at the end of the day.  They still want a flat and so they still constitute part of the demand for flats.  Hence, the massive oversubscripton of new flats is indeed a reflection of the massive demand for new flats.

You said that only 6% of complaint cases from first time buyers are geniune.  However, some of the examples you reportedly gave on 8 Oct 2009 were in themselves dubious.  Your case study of Mr C rejecting flats facing the mosque may be unreasonable to you and the HDB but may not be unreasonable to Singaporeans who wish for a more quiet place.

HDB flats are unaffordable

You said there is the CPF housing grant of $30,000 or $40,000 and an additional grant of up to $40,000 for low income families.  However, these grants are not even enough to make up for the more than $100,000 increase in flat prices across Singapore over the last three years.  You said that the government disbursed more than $330 million in housing grants to more than 20,000 families.  But a nominal increase of just $40,000 in the price of new flats multiplied by the 13,500 flats sold last year would have seen government coffers swell by $540 million.  That easily beats the government grants that have been disbursed.  Rapidly increasing flat prices have swelled government coffers a lot more than the grants that has been disbursed.

You said that our house price to household income ratio of 5.8 is low compared to London’s 7.1 and Hong Kong’s 19.8.  However, the ratio for London was calculated omitting the 15% Londoners living in cheap rental flats while the ratio for Hong Kong was based on expensive Hong Kong Island alone which excluded Kowloon and the New Territories where the bulk of Hong Kongers actually stay.  Hence, the ratios you quoted are flawed and unfairly skewed towards more expensive accomodation in those cities.  Furthermore, the choice of highly expensive London and Hong Kong as comparison targets also serves to show just how expensive Singapore has become.

You said our monthly mortgage payment to household income ratio of 22% is lower than the affordability benchmark of 30% to 35%.  But the international affordability benchmark is in essence an unaffordability benchmark that marks the level of absolute unaffordability much like the poverty benchmark of $1 per day marks the level of absolute poverty.  Just as an income of $2 per day which lies above the poverty benchmark does not imply that there is no poverty, similarly, a ratio of 22% which falls below the affordability benchmark of 30% doesn’t imply that housing is therefore affordable.  Furthermore, it is misrepresentative to base our affordability ratio on new flats only since the 13,500 new flats last year is only a fraction of the 37,205 resale transactions registered last year.

Your case study of Mr and Mrs S does not represent the average 4-room flat applicant which according to the HDB’s reply to the Straits Times on 12 Sept 2009, has a household income of $3,800 paying a monthly mortgage of $955 for a flat priced at $265,000.  If we assume an average of four persons living in the household each requiring a monthly sustenance of $500 at a minimum, the family’s total basic monthly expenditure would add up to $2,955 leaving only $805 for all other purposes and for retirement funds for both parents.  Is the measely sum of $805 sufficient for retirement and for all other purposes?

PRs push up prices

You said that PRs do not push up prices since they do not pay very high COVs.  But that is not how PRs contribute to high prices.  By simply taking up units, be it flats or private properties, PRs absorb the supply of available housing leaving less for Singaporeans.  When supply is less, price goes up naturally.

Private property owners push up prices

You said that private owners do not push up HDB prices since they are involved in only 11 out of 58 resale transactions exceeding $70,000 in COV.  But that is like looking at the tip of the iceberg and concluding that the iceberg is not very big.  Beyond those 11 resale transactions are countless other transactions involving private property owners.  Collectively, they soak up supply leaving less to be competed for by the rest.  Greater competition for a dwindling supply naturally leads to prices being pushed up.

Thank you

Ng Kok Lim

Independent judiciary in a Liberal democracy

By Richard Lu

In liberal democracies, citizens are mandated to obey the rule of law.  It stands to reason that the independence of the judiciary is not only an important part of a liberal democracy, but some might suggest it is essential.
 
To understand why an independent judiciary is an important part of a liberal democracy we must briefly acknowledge what a liberal democracy is.  A liberal democracy, at its purest, is a democratic government that seeks to represent the will of the people through the entrenchment and protection of individual rights and freedoms.  It is of the utmost importance to maintain independence of the judiciary in order to prevent the possibility of undue influence exerted by other governmental agencies on the courts.
 
Within the Singapore Constitution are the essentials for a liberal democratic system including the rights and freedoms and the powers of Government and its commitment to the rule of law.  The rule of law applies not only to the people, but also to the government.   We have chosen to protect the ability for the judiciary to maintain the rule of law, independent of undue external influence, and thereby protect some of the core aspects of our liberal democratic framework.
 
The Singapore Judiciary
 
The full Judicial power in Singapore is vested in the Supreme Court as well as subordinate courts by the Constitution of Singapore.
 
·         The Supreme Court consists of the Court of Appeal and the High Court.  The Court of Appeal exercises appellate criminal and civil jurisdiction, while the High Court exercises both original and appellate criminal and civil jurisdiction.
·         The Chief Justice, Judges of Appeal, Judicial Commissioners and High Court Judges are appointed by the President from candidates recommended by the Prime Minister.
·         The Prime Minister must consult with the Chief Justice before recommending the Judges.

·        Singapore practices the common law legal system, where the decisions of higher courts constitute binding precedent upon courts of equal or lower status within their jurisdiction. ·         The President has the power to grant pardons on the advice of the cabinet.

Recent milestones
 
·         Jury trials were abolished in 1969;
·         The Criminal Procedure Code was amended in 1992 to allow for trials of capital offences to be heard before a single judge;.
·         In 1986 the Legal Profession Act was amended to only allow the Law Society to speak on legal issues upon request by the Government; and·         The Court of Appeal is Singapore’s final court of appeal after the right of appeal to the Judicial Committee of the Privy Council in London was abolished in April 1994. Judicial independence in Singapore – recent comments*
In 2004, the US Department of State claimed that:
·        Although Singapore’s judicial system provides citizens with an efficient judicial process, the judiciary is largely compliant and the Government often uses defamation suits or the threat of such actions to discourage public criticism and intimidate the press;·         The President of Singapore and the Minister for Home Affairs have substantial de facto judicial power, leading “to a perception that the judiciary reflected the views of the ruling party in politically sensitive cases.”; and ·         Singapore’s “judicial officials, especially the Supreme Court, have close ties to the ruling party and its leaders”. Notable cases include those against opposition leaders J. B. Jeyaretnam, Law Society ex-President Francis Seow and Dr. Chee Soon Juan.
* Available in the Internet.
 
Conclusion
 
·         Adherence to the rule of law is crucial to a liberal democracy;
·         It is importance that the laws are correctly interpreted and applied within the context of a liberal democracy;
·         Within a liberal democracy, governmental powers are not above the scope of the law.;
·         It is therefore essential that the judiciary, as the vehicle for enforcement of the law, be at arm’s length from other pillars of government that may come under legal question;
·         Immunity from legal liability for Judges while performing their duties;
·         Guarantees of tenure;
·         Salary protection; and
·         Judicial appointments, free from political interference, is therefore a central tenet of an independent judiciary.
 
 
 
Notes:
 
Constitution of Singapore is the supreme law of Singapore and it is a codified constitution. The constitution cannot be amended without the support of more than two-thirds of the members of parliament on the second and third readings. The president may seek opinion on constitutional issues from a tribunal consisting of not less than three judges of the Supreme Court. Singaporean courts cannot offer advisory opinion on the constitutionality of laws.

Part IV of the constitution guarantees the following:

Liberty of a person (limited).
Prohibition of slavery and forced laborProtection against retrospective criminal laws and repeated trialsEqual protectionProhibition of banishment and freedom of movementFreedom of speech, assembly and association (limited)
Freedom of religionRight to education

Part XII of the constitution allows:
 
The Parliament of Singapore to enact legislation designed to stop or prevent subversion. Such legislation is valid even if it is inconsistent with Part IV of the constitution. The Internal Security Act (ISA) is a legislation under such provision.
 
 
Further reading
 
http://www.singapore-window.org/1028judi.htmhttp://www.theage.com.au/news/business/suffering-singapores-slings-arrows/2006/04/18/1145344082712.htmlhttp://www.scribd.com/doc/3939236/Rule-of-Law-in-Singapore-Independence-of-the-Judiciary-and-the-Legal-Profession-in-Singaporehttp://www.news.gov.sg/public/sgpc/en/media_releases/agencies/pmo/press_release/P-20091111-1http://online.wsj.com/article/SB121674589942074015.html

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