TR EMERITUS

Written by Our Correspondent For the second time in a few months, National Development Minister Mah Bow Tan has called upon Singapore home buyers to be "realistic" while emphasizing again that there are adequate flats to meet demand. Mr Mah had been feeling the heat of late from angry Singaporeans who are unable to obtain a flat of their choice due to sky-rocketing HDB flat prices due to an inadequate supply of flats in the face of rising demand fueled by immigration. Only about 11,000 flats were built between the years 2006 - 2008 when the rate of immigration is at its peak. 3,183 flats were built in 2008 when there were over 90,000 PRs and 20,000 new citizens alone. Recent BTO launches are between 5 to 10 times oversubscribed, an indication of how severe the housing crisis has become. The prices of resale flats grew by 8.2 percent last year and median cash over valuation (COVs) doubled from $12,000 to $24,000 in the last quarter of 2009. Mr Mah is of the view that the high application rates for recent BTO launches did not reflect the true demand for flat as "half of the applicants for Housing Board's new Build-to-Order (BTO) flats did not book a unit when invited to do so last year, even though the application rates exceeded the flat supply by several times." "About 22 per cent of the applications for such flats in the last four months - from November to February - were repeat applicants from the same household and not all the applicants were in urgent need of a flat," he added. Mr Mah also repeated the exhortation he made last year to Singaporeans to be "realistic." "While the Government is committed to helping Singaporeans own their first homes and there are enough new flats to meet demand, flat buyers must be realistic........It is not possible to promise every applicant who buys direct from HDB his 'choice' flat, at the floor of his choice; at the place of his choice; at the time of his choice; and at the price he wants," he said. With elections around the corner, HDB has promptly released more BTO projects to meet the spike in demand. The state media has gone on an overdrive to cover up Mr Mah's mistakes. Despite evidence suggesting otherwise, Mr Mah continues to insist that HDB flats remain "affordable" to ordinary Singaporeans. The Straits Times published an article last Saturday by two NUS professors showing that public housing in Singapore is affordable compared to housing elsewhere without revealing that one of them sits on HDB board. It is obvious from his attitude that Mr Mah is not quite ready to admit his folly and oversight. With no opposition in parliament, there is literally nobody who can take him to task. Given his dismal track record over the last few years, Mr Mah should be realistic too in the next election as there is a good chance that he may be voted out by angry Singaporeans from his Tampines stronghold.  Read More →

OPINION The buzzword on the lips of PAP ministers nowadays seem to be "productivity" - everybody seems to be talking about it since Prime Minister Lee Hsien Loong announced his ambitious plan to boost Singapore's flagging productivity rate to 3 per cent per annum. Minister in the Prime Minister's Office Lim Swee Say, who had been exhorting Singaporeans to be "cheaper, faster and better" now changes his tune and urge both workers and companies to boost their productivity. During his Budget speech last week  Finance Minister Tharman talked about the need to raise our productivity growth rate to 2 to 3% per annum from its current level of less than 1% p.a. Now, even the Defence Minister Teo Chee Hean is jumping into the fray: “We have made good progress in the past in our productivity drive and that is why we have been able to move our economy forward and have good jobs for many Singaporeans. But this is a constant effort and we have to renew and re-double our efforts,” he was quoted as saying in Channel News Asia. There are two ways to go about increasing one's productivity rate: 1. Increase the output using the same amount of manpower and working hours. 2. Produce the same output with a reduced manpower and working hours. The PAP ministers should walk their talk first and set a good example to Singaporeans by boosting their own productivity levels before they start preaching again. This can be easily done by trimming down the bloated Prime Minister's Office and reducing the number of MPs in Parliament which will surely save taxpayers millions of dollars. As of now, the Prime Minister's Office contains the following positions: 1. One Prime Minister. 2. One Minister Mentor. 3. Two Senior Ministers. 4. Two Deputy Prime Ministers. 5. Three Ministers without portfolios. Why does one of the smallest countries in the world with a 5 million population require so many Ministers in the Prime Minister's Office? Our nearest neighbor Malaysia has only one deputy prime minister and three ministers without portfolios though it is much larger than Singapore. Similarly, both Australia and Canada which inherited the same Westminister form of parliamentary democracy from the United Kingdom do not have such "unique" positions in their cabinets. Since Singapore's Prime Minister is the highest paid leader in the world, surely he is able to cope with the workload without the help of so many ministers in his office. It is disheartening to note that while Singaporeans have been urged repeatedly by the government to make sacrifices for the nation by putting up with lower wages, longer working hours and unfair competition from the foreigner workers, its leaders found fit to raise their own salaries by a hefty 8.8 per cent this year. Prime Minister Lee should seriously consider trimming his Office to increase his own productivity rate and to cut down on unnecessary expenditure. He needs only one deputy prime minister and perhaps two ministers without portfolios. At the same time, the number of MPs in Parliament can be reduced by at least 50 per cent since most, if not all of them sing the same tune as the government and offer nothing different or concrete. When asked of their views on the Budget speech, all the PAP MPs interviewed by the state media heaped generous praises on it. Why should we be paying $13,000 monthly for so many "parrots" to echo the government's stance? According to a TODAY report on 23 February 2010: “Salaries for political appointments – ministers, ministers of state and parliamentary secretaries – are estimated to be $58.28 million, or 8.8 per cent higher than last year.” [Source: TODAY] Will this $58.28 million dollars help increase the output and productivity of the ministers and parliamentary secretaries? PM Lee should conduct a detailed study to show Singaporeans that the pay rise is necessary to enable his ministers to serve Singaporeans better. Without boosting the productivity and cutting the operating expenses of his own Office first, how is he going to convince Singaporeans to do so?  Read More →

Written by Our Correspondent According to a report in Wall Street Journal, the Government of Singapore Investment Corp. (GIC) has incurred a paper loss of $5 billion or about S$7.2 billion dollars on its investment in Swiss bank UBS after its notes are converted to shares yesterday. While the disastrous loss made headlines worldwide, it was not reported by the Singapore media yet. In 2007, GIC acquired a 9% stake in UBS through convertible notes on a fixed coupon of 9% per annum with a two-year maturity period. It was revealed by Bloomberg a few days ago that GIC took only 3 days to make the decision to invest in UBS: “Marcel Ospel, then chairman of Zurich-based UBS, called GIC Chief Investment Officer Ng Kok Song, according to comments they made at the time. Talks began on Dec. 6, 2007, and by the evening of Dec. 9, GIC had committed to make its biggest single purchase at the time,” Bloomberg reported. [Source: Bloomberg, 1 March 2010] Deputy Chairman of GIC Dr Tony Tan said then in a statement that GIC had “confidence in the long-term growth potential of UBS’s business, particularly in the global wealth management business”. The future of UBS looks bleak as it continues to be embroiled in a protracted court case with the U.S. government over the release of confidential information of its U.S. clients who are being suspected for tax evasion.  GIC’s Chairman Lee Kuan Yew also appeared to be unfazed by the prospect of an impending UBS collapse. In an interview with Channel News Asia last year, he said: “When we invest, we are investing for 10, 15, 20 years. You may look as if you are making a big loss today, but you have not borrowed money to invest. You will ride the storm, the company recovers, your shares go up.” [Source: CNA, 6 Feb 2009] Set up in 1981 to manage Singapore's reserves, GIC has been headed ever since by Singapore's octogenarian leader Lee Kuan Yew, who is a lawyer by training. His daughter-in-law Ho Ching is the CEO of Singapore's other sovereign wealth fund Temasek Holdings. This is not the first time that GIC has suffered such a tremendous loss in its investment. A Wall Street Journal article published in September last year reported that GIC may have suffered a loss around 59 billion Singapore dollars (US$41.6 billion) in the fiscal year ended March. (read article here) In other countries, such a loss would have lawmakers calling for an independent Board of Inquiry to investigate what's wrong. The issue was never raised in the recent parliamentary "debate". Even if it is, it is highly unlikely that Singaporeans will get an answer from Finance Minister Tharman who once said that the system in Singapore is based on "trust". Till today, nobody knows how much reserves Singapore still has after the multi-billion dollars losses suffered by GIC and Temasek Holdings.  Read More →