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Wednesday, 29 February 2012

Shall, May, Must, Ought - A By-word on a By-Election

I have been following with interest the recent exchange of letters between Hri Kumar and Eugene Tan in the TODAY newspaper, regarding the issue of calling a by-election in Hougang.
With all due respect to lawyers and legal academics, the debate on the constitutional requirements of having a by-election is irrelevant to most ordinary citizens. The legal interpretations that turn on the words ‘shall’, ‘must’, ‘may’,  ‘at convenient speed’, and whether an election can either be a General Election or By-Election is frankly over the heads of non-legally trained people (and frankly it does not interest us as much).
I think the operative word that has been lost in the debate is ‘ought’. Ought the Prime Minister call a by-election as soon as possible? In my opinion, this is a more important question than the constitutional debate by legal experts. 
In this case, I think it is an unequivocal yes. However one interprets the constitution, Hougang is a Single Member Ward that has no other elected Member of Parliament serving its constituents. This is very different from a GRC where the loss of one member still means that other elected team members can serve the people that elected them. 
Therefore, the Prime Minister ought to call a by-election as soon as possible.
But the most important fact that people are missing is that the PM never said that he will not call a by-election, just that the nation has other pressing issues that need attending to. And in case people have not noticed, the Yaw Shin Leong affair happened just before the Budget Debates and his seat was only declared vacated on the first day of the Budget Debates.
This was two days ago. 
We should have more patience than to jump to conclusions that the PM is not going to call a by-election or he is delaying the calling of one. I re-iterate – the seat has only been officially vacant for TWO DAYS.
I am sure that once the Budget debates are over, the Prime Minister will make a decision to hold a by-election.
In the meantime, we should focus on a very important Budget debate, instead of getting carried away with the ‘shalls’, the ‘musts’ and the different shades of ‘mays’.

Monday, 27 February 2012

Budget 2012

In many ways, the 2012 Budget represents a shift towards a new compact between the PAP government and the people. 
It recognises the desire of a younger generation to go beyond a naked drive towards material well-being and accumulation of wealth. The old compact with our parents' generation was a simple one – give the PAP a popular mandate and they will make sure we are materially better-off year-after-year. Most attention was given to GDP growth, which by definition focuses on the welfare of the average Singaporean. Our GDP per capita still ranks amongst the highest in the world, even on a purchasing parity basis, which means that the average Singaporean lives better than the average citizen in other countries.
This is not enough for the new generation. The PAP has successfully taken Singapore to developed-nation status but has in the process bred a new generation that has post-materialist desires – desires that go beyond the bread-and-butter. In this, we are not any different from other developed countries. Bread-and-butter issues are of course still important, but for the new post-materialist generation , it is not enough to merely grow GDP per capital , but also to ensure that in our pursuit of growth, nobody gets left behind and we build a cohesive and inclusive society. This Budget recognises this in several ways.
Firstly, it recognises that even though foreign workers have been instrumental in our years of breakneck growth, their presence in our society has not been without costs. On an emotional, psychological basis, when almost a third of people residing in Singapore are foreigners, there is bound to be an impact on our social make-up. Not only do we have to share our already crowded living spaces with more people, it is with people we find difficult to identify with as they come from  different cultures. It also causes fissures and frictions in our social make-up. In a society still in its adolescence which is still struggling to find a Singaporean identity, this cannot but be detrimental.
If however we make a choice that we want a society that has a smaller number of foreigners, it is also not without costs. This is the nature of policy making – there is no perfect policy, no right answer, but a choice between several options each with costs and benefits.
In this case, if we want to make do with fewer foreign workers in our society, Singaporeans have will also have to adapt, and this adaptation could in the short run also be painful.
Firstly, businesses have to increase their productivity so as to make do with fewer workers. This is easier said than done. The government recognises this and has introduced a slew of measures in the Budget to help businesses including a small cash grant, an enhanced Productivity and Innovation Credit Scheme and other measures. The road to a lower reliance on foreign workers will nevertheless be a long and hard one, especially for small businesses. 
To begin with, most small businesses operate on a tight cash-flow and run on a day-to-day, month-to-month basis. In order for them to invest in workers now so that will see an increase in productivity in future (that may or may not happen), is to ask them to forgo precious cash that they need now for an intangible future. The PIC schemes still work on a reimbursement basis, meaning that firms will need to fork out their money first. Although the enhanced PIC now pays out on a quarterly basis, a quarter is a long time for small business that operates on a tight cash-flow. It may be difficult for them to spend $10,000 and then have to wait 3 months to get $6,000 back. 
More importantly, training in order to increase productivity is not immediate. Whereas if one hires a foreign worker one sees the immediate benefit as he can be put to work from the outset, a local worker isn’t going to be able to miraculously start being able to serve 10 tables in a minute after a week’s training course. In the meantime, as new processes are put into place, and as workers learn more productive methods, businesses suffer from a manpower crunch which can put them out of business.
Ordinary Singaporeans will suffer too. When businesses go bust, Singaporeans also lose their jobs – and let’s not forget that many business owners are also ordinary Singaporeans trying to make a living. Singaporeans as consumers will also be impacted. Recently, I have noticed that the tables at Starbucks do not get cleared as fast, as they are unable to hire as many foreign workers as in the past. We as Singaporean consumers will thus also have to adapt.
A second post-materialist desire this budget recognises is that it is not enough anymore for the government to roll-out statistics that Singapore as a whole is doing better and better every year – the younger generation also want to make sure that the worst-off and most vulnerable in our society are also taken care off. 
Budget 2012 recognises this by taking significant steps to ensure that 3 groups of particularly vulnerable Singaporeans are not left out – the old, the poor, and the disabled. 
I too believe that it is the mark of a developed society to have compassion for our least well-off. To this end, I applaud the generous measures that the government has introduced, that will cost billions of dollars.
But again, nothing comes free and money does not grow on trees. The money that the government is spending to help the least well-off comes from public finances – that is the money that belongs to us, the taxpayers. It is all well and good to wear our hearts on our sleeves and wax lyrical on compassion and helping others but the litmus test is always when we are asked to put our money where our mouth is. At this moment, our public finances are in good shape and the government is able to spend money without raising new money.  However, if one day we are asked to pay more taxes in order to keep these measures up, will we be ready to do it? Are we willing to put our money where our mouths are when push comes to shove? It is always easier to champion compassion and charity when one does not have to bear the costs or feel the pinch of doing so.
Finally, in our push for a more inclusive Singapore, we must not forget the bread-and-butter issues that face every Singaporean. In an uncertain global outlook, we must not get too obsessed with navel-gazing and be acutely aware that the greatest challenges that Singapore face come from outside. In our quest to be less dependent on foreign workers domestically, we must not forget that we will always as a country be dependent on foreigners and the world outside, given our size. In our quest to perhaps run a little slower so that our least well-off can keep up, we must not forget that we must still run faster than everybody else as it is the only thing that ensures we survive as a country. We are an improbable nation built against the odds. As we build a stronger and more cohesive nation, it must always be to one end – that we remain a prosperous, independent country, a united Singapore we call our home.

On Ministerial Wages

There is no doubt that the issue of Ministerial Pay is an emotional one but in the midst of heated debate, it is still useful to reason with cool heads.
Firstly, not enough attention has been paid to the principle of “clean-wage”. This principle is not only at the heart of the Ee Report, it is also the premise on which the entire system of ministerial wages is based, from the beginning when Mr. Lee Kuan Yew implemented it, right up till now.
The wage that office-holders in Singapore get is the totality of the remuneration they get – there are no hidden perks like hospitalization benefits, housing benefits, tax exemptions etc. With the exception of the President, the Prime Minister and the Speaker of Parliament, no office-holder or Member of Parliament is given a car for personal use. And even then, the use of the car is a taxable benefit, rather than a perk. This is exceptional compared to most coutries, especially at the Ministerial level.
This point cannot be emphasized enough. Much has been said online, in the local press and in the international press about our leaders being the best-paid. The benchmark for of this is the salary, specifically the cash-component of an office holder’s income. This is not a fair comparison. The most quoted example one sees repeated ad nauseam is the President of the United States salary of US$400,000. However this does not include all his other benefits which include free accommodation in the White House and use of its army of servants and staff, official transport and a whole range of other perks and non-cash benefits. It is also interesting to note that the reported salary of the President of China is US$11,000. Without being facetious, one wonders how such a salary could possibly allow him any respectable accommodation of any sort, even if he were to just rent in Beijing. It was also the ‘benefits’ part of remuneration that led to the scandal involving expense-claims, specifically housing claims, of the Members of the UK Parliament.
The strength of our clean-wage system is also its weakness. The transparency of this system allows us to know exactly how much our political office holders get. However the difficulty is that we alone implement this system. When nobody else in the world has a clean-wage system, and all comparisons are made purely on cash-income, then our leaders will always look like the highest paid.
The crucial question then is whether it is fool-hardy for the Singapore government to stand alone in a world where nobody else offers a clean-wage system. As an emotive issue, and with continual unfair comparisons being made purely on cash-income, a good system has become a public relations disaster. No amount of explanation will defuse the issue when the stark contrast keeps getting emphasized in salary league tables. The Singaporean voter could in the end, be no different from, and no less human  than any voter or citizen anywhere else in the world, and a remuneration system with perks and benefits could prove more politically palatable than a clean-wage system.
Secondly, to poll the average man on the street on what he thinks of a million dollar salary is pointless. The problem is one of perspective and the perspective of the top income earners anywhere in the world is something no man on the street can empathize with; whatever method one uses to arrive at the pay is irrelevant, once that number is large enough. 
To the average man, a pay cut of 1/3 from 1.5 million to 1 million still leaves an unfathomable sum. But the 500,000 difference could lead to a real impact on the standard of life as it could mean the difference of meeting that mortgage payment on one’s house. We cannot possible expect our office-holders to sell their houses and downgrade in order to take up their appointment.  By the time some of these potential office holders have reached their 40's , they have settled into a certain lifestyle that requires a certain income to upkeep. To expect these people to sell their houses, their cars, or to forgo their children's education overseas is just an idealism that bears no relation to reality. In the end, we will only end up like other countries where only people who are financially independent and secure will enter politics seriously. 
Thirdly, while we appreciate and value the ethos of public service, it is unwise to over-play it. The generation of Lee Kuan Yew and Goh Keng Swee was borne in a time of chaos, revolution and change in a post-colonial world. Even then, it was pure luck that we got these people rather than the rapacious leaders that impoverished many countries that became independent the same time as Singapore.
We could thus pay low wages and hope that some able, altruistic men and women would step forward, or create a system that increases the chances that we will still get able leaders, altruistic or not. At the end of the day, we are not looking only for servants, but leaders with specific skill-sets to govern our country, manage our economy and make policies that would affect our country’s future. Beyond a calling, there is thus also a job to be done, and in order to get people with the right technocratic skills to get this job done well, there is no shame in paying for it. 

We must not confuse political governance with charity work.