TR EMERITUS

Leong Sze Hian CPF funds managed by GIC? For the first time in our history, we recently disclosed that CPF funds were managed by GIC. 9.5% return for 25 years? This is arguably the second major disclosure in history, after the first revelation in 2006, that the GIC had annualised returns of 9 5% in the 25 years to 2006. GIC not sure whether it managed CPF funds? In this connection, Leong Sze Hian wrote an article on 27 December 2013, about even the GIC saying that it did not know whether it was managing CPF funds. - “According to the GIC’s web site: “FAQ Popular 5. Does GIC invest CPF monies? The short answer is that GIC manages the Government’s reserves, but as to how the funds from CPF monies flow into reserves which could then be managed by either MAS, GIC or Temasek, this is not made explicit to us. What we do know from public sources: Singaporeans’ CPF funds are invested in bonds called Special Singapore Government Securities (SSGS) which are fully guaranteed by the Government. These are non-marketable floating rate bonds issued specifically to the CPF Board. These bonds earn for the CPF Board a coupon rate that is pegged to CPF interest rates that members receive. Under the Protection of Reserves Framework in the Singapore Constitution of the Republic of Singapore, the Singapore Government cannot spend any monies raised from Government borrowings. All the proceeds from the Government’s borrowing are therefore invested.” Even GIC doesn’t know? So, what does the above mean? That the GIC itself does not even know whether it has gotten CPF funds?” Temasek 16%, GIC? So, since we know that Temasek had annualised returns from inception of 16% for the last 39 years – why is it that we still do not have any transparency as to what was the GIC’s returns in S$? Well, let’s try to estimate the returns from the information that is publicly available. 6.5% for 20 years in US$ According to GIC’s annual report, its annualised returns for the past 20 years was 6.5% in US$ terms. In S$, we estimate the returns to be about 5%. Historical returns over 6%? As it was 9.5% for the past 25 years until 2006 – we estimate the returns from inception to be about over 6%. Similar to other national pension funds? Co incidentally enough, this seems to be quite close to the average annual returns of most national pension funds in the world in history – about 6% nominal or 4% real returns (after adjusting for inflation). The fundamental difference between our CPF and other national pension schemes may be that whilst others get the full returns – Singaporeans only get an estimated average overall rate of about 3+ % on all the CPF accounts. Lowest pension fund return in the world? Since inflation for the last decade, from 2003 to 2013 was about 2.7% per annum – we estimate the real return on our CPF to be less than 1% based on the interest rates paid in the CPF accounts. This makes our returns, to be possibly the lowest of all national pension schemes in the world. Each Singaporean may lose $1.5m? The bottom line – each Singaporean may have lost more than $1.5 million in their CPFthroughout their working lives and retirement years till death.   S Y Lee and Leong Sze Hian  Read More →

For the past few weeks, the soccer mania fever is sweeping across the land like nobody’s business. This once in 4 years World Cup Soccer is getting on every one’s nerves. They say that this is the most watched sporting game in planet earth with billions glued to the box or keeping track via newspapers, radio and internet. Even the Olympic Games do not garner such an immense interest. It is the time where nations pit against each other in the field for glory and honor in a fair game witnessed by billions across the globe. It is the time where glory is scored and history is made. The sweet victory of the winners and the despair of the vanquished clearly demonstrated on the expressions of the players and their supporters as the exhilarating World Cup drama unfolds before our eyes. It’s the only single sporting event that cuts across all barriers of race, color, creed or boundaries where sportsmen compete ruthlessly for fame and immortality. As it is, so many surprises and unexpected hiccups already happened in this historic event. World Cup nite at Elias CC Back to home ground, there is a legion of faithful die-hard soccer fans losing sleep over the game. The time difference between the place of action and us when watching the live telecast upsets our routine clock work. Needless to say, some take leave or even call in sick when they are too tired to work the next day. Whatever it is, I don’t watch any of the games at all. In fact, I don’t watch television or read the print newspapers. I only keep track of news on the internet and just read books when I’m free. According to friends, I’m quite a boring person really. I only watch the final when the best two teams slug it out for the World Cup. That will be the only game I’ll watch. It seems that my prediction is coming true. I bet with my buddy James that Argentina will take the World Cup. Let’s hope I’ll win a couple of beer from James. He’s placing his hope on Brazil. Knowing that I don’t watch those games until the last game, my mentor and neighbor Alan Taxi – AT, keep asking me to drive for him especially when his favorite teams are playing. I’ve not got any driving assignment recently except for the occasional relief whenever one of the taxi drivers at EM decides to take off. I usually oblige AT whenever he requested me to relief him on the night shift. Together with some of the kakis at EM, they would watch the games at Elias Community Centre badminton hall. He would be so excited that he would keep whatsapping me which team was leading and the crowd size at the CC. Initially, the CC welcomed everyone. But lately due to overwhelming demand, the CC started to restrict soccer fans to about 650 persons. At one time, there were more than a thousand fans inside the air-conditioned hall in the CC. Due to safety reasons, the CC decided to cap the viewers at about 650. I came to know about the restriction only on Sat early morning when I saw AT and few others walking restlessly outside the CC at EM. I was taking a short driving break then about to ferry Smelly back from EM when I saw AT. I asked him why was he not inside the CC watching the exciting match between Germany and France. He sheepishly told me that he could not enter the hall to watch the game due to “full house”. He was late to get a ticket for the game. It’s so cruel to him. He could only sit around aimlessly outside the CC fantasying his favorite German team in action. Most of the residents including myself who don’t bother to watch the games feel that the CC is doing a great job by screening the World Cup soccer games to residents in the air-conditioned hall with free bottles of mineral water sponsored by Singapore Pools. In fact, the costs of the screening also sponsored by Singapore Pools. Unlike four years ago, many places now do not screen the soccer games due to exorbitant costs. Not even one coffee shop in Pasir Ris estate is screening the games. I heard that it is also quite expensive to subscribe to the package of games. As such, many die-hard soccer fans in the neighborhood flock to the CC to watch the free games. Now my question is whether the CC is catering to all soccer fans or residents only? According to AT, foreign workers from the faraway dormitories at Tampines Link near to Ikea even walk all the way to the CC to watch the games. After all, it’s cosy with air-condition plus free mineral bottles of water. Since it is Pasir Ris Community Centre, shouldn’t it cater primarily to Pasir Ris residents only? We feel that residents should be given priority first. If there is not enough places for residents or locals, why should we extend the hospitality to foreigners? Do we owe it to them this favor? To admit viewers on a first come first serve basis is not quite practical in this instance. Look at some of the residents such as AT and his buddy Johnny Cash who could not get places in the “full house” hall at the CC ended up wandering listlessly with glum faces. The other solution is to screen it in the open car park under a tent where everybody is able to watch the games like they used to do it for the EPL games before. I think that will be ideal where everyone gets a chance to watch whether you are a resident or a foreigner. Every one will be happy watching the games together. They could scream and openly cheer their favorite teams. The sense of camaraderie and esprit de corps is priceless. Imagine foreigners and locals enjoying themselves in the excitement of the games. Even better if they could screen indoor in the hall and simultaneously screen it outside in the open car park within the CC compound. No one will be deprived of watching this world wide phenomenon. The screening at Robertson Quay and Hong Lim CC are good examples to emulate in future World Cup telecast. In appreciation of what those foreign workers have been contributing to our economy, we do not mind them watching the games with us together but definitely NOT at the expense of us residents being lock-out in the games due to their overwhelming numbers. Surprising, we did not notice any PRCs amongst them. Let me make it clear that I’m not xenophobia. I’m merely reporting the facts. I’m stating what I observed. Again, I feel that the CC is doing a great job organizing free live screening of the once in four-year mother of all sporting events – the World Cup soccer games. Many really appreciate the generous gesture but they (residents) – like in so many other things in our own country will have to compete with the foreigners, even in this instance watching soccer games in our own community centre. I guess that’s life here and we better get used to this reality. Gintai_昇泰 * The author blogs at Gintai.Wordpress.com.    Read More →

(6 Jul) I went on the democracy march on Tuesday, start to finish, from Holding Pen No. 1 in Victoria Park to the corner of Pedder Street and Des Voeux Road in Central, where one of the marshals said that was enough. Protesters march on the streets to demand universal suffrage in Hong Kong. (Pic: SCMP) Was it worth it? Did I accomplish anything? The trainer at the gym would certainly say I did. Seven hours of standing or shuffling slowly along a 7km route, carrying two litres of water in my backpack, no chance to sit down for a rest, soaking wet the whole time because I was caught out by a rain shower in Victoria Park - beat that for endurance training. But, yes, I do think it was worthwhile. I do think the authorities pay attention to the numbers on the march and I do believe that democracy is essential to Hong Kong's continued prosperity. I think it is essential to China's, too, but that's another matter. Hong Kong is my home. I have lived here for 35 years and it is for democracy in Hong Kong that I marched. I am a classic Liberal. I stand for free choice. Several things struck me on the march. First, it was a Hong Kong crowd through and through. .... It was also a well-behaved crowd. Other commentators have made mention of how the police have become adept at handling crowds. I would phrase it differently. The crowd was adept at handling the police. No offence was given. The most I heard were shouts of: "Open the way." But not all participants were regarded equally. Those who were thought to be advancing separate agendas did not have the full sympathy of other marchers. .... The banners for which I actually heard the loudest cheers from the marchers were simple placards held up by two women on a balcony along the route, bearing the words: "Go for it!" .... If government does not rule with the consent of the governed, by what authority does it rule at all? [Read more:  South China Morning Post]  Read More →