This was a speech given in Parliament by NCMP Mr Leong Mun Wai on 5th March 2022 after the COS debates
Accounting Treatment of Expenditures
Before we raise taxes, we should consider whether there are expenditures we can cut. However, it is not easy to understand the expenditures in the Budget. Hence I have the following questions.
Can the Minister present the Covid-19 $100 billion spending in the same format as the budget, with detailed breakdown by spending category and ministry?
Where is the $5 billion annual spending on R&D reflected in the budget? Where and how is the allocation approved?
Explain how the SINGA loans and investments are being treated in the Budget and the Government’s Statement of Assets and Liabilities. What does the $2.4 billion recorded as capitalization of nationally significant infrastructure for FY2022 mean?
And finally on revenues,
Can the Minister confirm that the Government has reported total financial assets of $1.4 trillion at 31 March 2021. That MAS has accumulated close to $200 billion of new reserves in the last two years. And all these financial assets are producing more than $40 billion in Net Investment Return per year.
Streamlining the Government
In this Budget, we are looking for ways to cut costs. The most effective way to cut costs is to streamline the Government structure. We should ensure the money is applied efficiently. For each social purpose there should be only one channel or platform.
The People’s Association (PA) with its $908 million budget comes to mind. Community engagement and citizens’ welfare are very important, but they are separately served by the Ministry of Culture, Community and Youth (MCCY) and the Ministry of Social and Family Development (MSF) with budgets of $107 million and $611 million respectively.
The PA is more like a political structure led by political appointees and volunteers. Thus, it is not clear whether it is serving the people or the ruling party. If it is not political, to avoid duplicating resources, we should either integrate the PA into the MCCY or put all community engagement activities at the MCCY into PA.
We should turn our community engagement into asset-light activities and stop incurring huge development expenditures on building new community centres. For FY2022, another $197 million is budgeted for such development. Instead, we should free up the land and resources tied up in community centres and other facilities and reallocate those resources to other social needs.
We can also potentially do more with the same dollar if we reorganize some activities among Ministry of Education (MOE), Ministry of Manpower (MOM) and MSF.
The $679 million earmarked for SkillsFuture should be taken out of MOE and integrated into MOM to ensure that the spending creates jobs for Singaporeans. SkillsFuture courses that do not result in better jobs should be dropped.
The $1.6 billion earmarked for Early Childhood Development Agency (ECDA) should be taken out of MSF and integrated into MOE to create a seamless education and development curriculum for our children. Finally, the original MSF minus ECDA should be reorganized into a new Ministry of Resilient Citizens (MRC) with the transfer of the $1.7 billion Financial Security Program from MOM to it. The MRC will focus on strengthening our social and financial compact and oversees social and family development, scholarship & bursary programs, CPF, a national healthcare scheme, a new unemployment insurance and lifelong fulfilment programs for the benefits of Singaporeans.
Job Security of Singaporeans
On 7th Feb 2022, the MOM’s rebuke of prominent blogger, Leong Sze Hian’s intuitive post last Christmas on job statistics highlighted the issue of job security for Singaporeans once again. Do foreign PMETs complement Singaporeans or do they threaten to take over jobs from Singaporeans? The reality is, it is probably more of a threat, so policy intervention is needed to rebalance the job market.
This reality however is not obvious from the MOM’s job statistics. The basic problem lies in MOM’s reluctance to present the employment data in individual categories of ‘original citizen at the start of the statistical period’, ‘new citizen’ and ‘permanent resident’ (PR). Instead it has lumped all the figures into one category as ‘locals’ so we do not have a clear picture of how policies have affected each category of people.
We have previously pointed out that while the Government has insisted that the 380,000 PME jobs created for locals between 2005 to 2020 has benefited Singaporeans, that is highly unlikely. This is because more than 635,000 new citizens and PRs were added to the “locals” statistics during the same period, and most of the 380,000 job increase would have been because of them.
In other words, the composition of the locals in 2005 and those in 2020 are different, and most of the job increase is not a real increase.
Hence not enough jobs are created for the 250,000 fresh Singaporean university graduates who joined the job market from 2005 to 2020. We can estimate that there is a shortage of 100,000 to 150,000 PME jobs for Singaporeans in the last twenty years, assuming that there are only 80,000 net PME jobs created from 2005 to 2020, and not counting those who were demoted due to discrimination.
If we truly want the foreigners to complement the Singaporean Core, then MOM must ensure that the Singaporean jobs are not being threatened. MOM should spend its time tackling this problem rather than wasting time and resources trying to rebut Leong Sze Hian.
SPH Media Trust
I was surprised to learn at the February sitting that taxpayers may have to pay up to $900 million over 5 years to support SPH Media Trust (SMT), the government-owned publisher of most of Singapore’s mainstream newspapers.
Since we are raising a lot of taxes in this Budget, we should be careful about such a new and big outflow of taxpayers’ money.
Firstly, where is the plan to recoup the $900 million over time? Do we have an exit plan, or will we keep funding SPH Media Trust for many more years beyond the first five years?
Secondly, why didn’t the government ask for more money from SPH, the listed parent, before it agreed to take the loss-making business out of SPH?
SPH’s assets have grown over the years, thanks to the hefty profits of the near-monopoly media business it previously enjoyed. Although in recent years, the print business has become a loss-making business due to the Internet, SPH has maintained overall profitability because of its huge property portfolio. Thus, it is reasonable to expect SPH to continue to fund the transformation of the media business.
Hence the government’s arrangement with SPH is evidently a bad deal, as taxpayers have to foot the bill of SMT at least for the next five years while the property assets of SPH which are worth at least $3.9 billion and expected to generate annual cash flow of $300 million according to one broker’s estimate, are likely to be sold to Cuscaden Peak, a company owned by our local property magnate, Ong Beng Seng for the benefit of existing and future shareholders.
Can the Minister explain what is the rationale behind government’s acceptance of such a deal?
Covid VDS Policy
Since the end of last year, many countries around the world have removed most, if not all of the Covid differentiation measures.
With the infection cases and deaths from Covid still at a high level, we are not against postponing the slew of easing Covid measures announced by Minister Ong Ye Kung on 16th February. However, we hope the Minister will not forget what he said at that virtual media conference that “these (Covid) rules accumulated over the past two years have become quite unwieldy.”
Indeed, we need to review and streamline many of these rules. The most unwieldy of these must surely be the Vaccination Differentiated Safe Management Measures (VDS), introduced incrementally from July 2021, when we switched to the “Living with Covid” strategy. This has brought significant misery to a number of Singaporeans who have valid personal reasons not to vaccinate.
Unfortunately, up till today, many of these VDS measures are still enforced, never mind that other rules have been relaxed with the arrival of the dominant but much less virulent Omicron strain.
The vaccines reduce the severity of Covid-19 infection but they have generally fallen short in their touted efficacy. Vaccination was not the universal panacea we imagined, and had little impact in reducing both infection rate and spread of the virus, especially with the current Omicron variant.
As we move toward normalcy in 2022, we urge the Government to relax all its discrimination policies based on vaccination status. The relevance and justification for VDS measures have dwindled and I believe the general public does not view this as being favorable nor fair.
Singaporeans who are unvaccinated are genuinely concerned about their health and each has valid concerns about the vaccine. Their movements continue to be restrained and some had to give up their right to employment due to such restrictions.
Now parents too have to contend with stress over vaccination for their children and there is a growing number of vaccinated Singaporeans agonizing over the issue of booster shots.
The latest vaccine safety update by HSA on 23 Feb reported 10 cases of children aged 5 to 11 with serious side effects following vaccination, and 280 cases of non-serious side effects. This is of particular concern and warrants closer scrutiny. One case of severe reaction compromising a child’s health going forward, is one case too many, given the fact that children are largely spared from any adverse health challenges from Covid infection.
It is time for the Government to show its magnanimity to this small group of unvaccinated people by relaxing the VDS measures, and not continue to “punish” them for making rational personal choices. They are not “trouble-makers” as the Government seems to make them out to be.
With the continuous surge in Omicron infections despite with all the VDS measures in place, indicates that the VDS measures are not critical in the fight against the virus. Hence, VDS should be relaxed immediately.
Instead, the Government should focus its resources on approving more therapeutics for GPs to treat patients to deal with the surge in infections. We are especially concerned about the senior citizens. In the last two years, we have established that age is the most important determinant in risk factors leading to death.
Hence management of the senior Covid patient can be more targeted. Shouldn’t approved therapeutics like Molnupiravir or Paxlovid be made available to senior patients early through GPs before they turn seriously ill and need hospitalization?
We see hope in Omicron being a game-changer. Let us review and refine our measures in our fight against Covid-19, and emerge as a people that is more compassionate and united than ever.