Mr Pritam Singh (Aljunied): Mr Speaker, it is not mere coincidence that the slogan of Forward Singapore is “Building Our Shared Future”, while that of Budget 2024 is the substantially similar “Building Our Shared Future Together”. The Government intends for Budget 2024 to be a step towards Forward Singapore.
The Forward Singapore exercise has three major goals for the decade and the next. Singapore must: first, have a strong and growing economy; second, develop a fairer society; and third, deepen our sense of unity. In doing so, the shared future that was distilled from various engagement sessions with the public was a Singapore that will be vibrant, fair, resilient, inclusive, thriving and united.
Sir, it would be fair to say that these are broad strokes that capture the Singapore that all of us seek. In the way it fleshes out the direction of the Government, Budget 2024 is not objectionable, and so the Workers’ Party (WP) supports the Budget.
The real challenge to the People’s Action Party (PAP), however, is for it to be open, and the extent to which it is prepared to accommodate the diverse views of Singaporeans on how to journey towards the destination envisaged by Forward Singapore. No doubt, PAP has asked for diverse views by demanding that the Opposition come up with alternative proposals, although one suspects they do so rhetorically. WP has responded sincerely and we have not been short of proposals that have ultimately been accepted by the Government in some shape or form, albeit after initial and sometimes significant resistance.
Indeed, this year’s Budget includes WP proposals; the announcement by the Finance Minister of a temporary financial support scheme for our workers is a case in point. While the details may differ, the philosophy of supporting our involuntarily unemployed is one which WP championed.
The same can be said for the WP proposals for anti-discrimination legislation to better protect our workers. Unlike PAP, WP clearly stated these proposals in our election manifesto, and our Members of Parliament (MPs) have systematically and repeatedly raised these points along with others in Parliament.
Mr Speaker, let me now put forward five points which form the basis of my response to the Budget.
First, the Government needs to be more forthcoming with information so that Singaporeans can participate more actively in policy discussion. Second, there is a growing mismatch in Singapore between aspirations and reality, which must be addressed. Third, the Government must improve retirement adequacy. Fourth, employers need to show more support for employees. And fifth, we must work towards further strengthening unity among Singaporeans in this uncertain world.
My first point is that the Government needs to be more transparent and forthcoming with information so that there can be meaningful participation by Singaporeans in the most critical matters affecting us. This is a recurring theme in my speeches, but I am by no means the only Singaporean to hold this view.
The Straits Times carried an article dated 19 February 2024 titled, “Economists applaud 2024 Budget but some worry about sustainability.” The economists quoted were concerned about the combination of large cash handouts with the lack of information about the sources of Singapore’s fiscal strength. In the report, one former Nominated Member of Parliament (NMP) called on the Government to provide more information on how it funds its expenditures.
Another economist noted that Singapore is unique and does not follow standards set by global bodies, such as the International Monetary Fund (IMF), with regard to the difference between revenues and expenditures in the management of the fiscal balance. Yet another economist was quoted as saying, “As a society, we now have some very important choices to make and, unless we are well-informed, we will not be able to make those choices well.” Sir, the latter point was about the Reserves, a subject which we debated earlier this month and where WP set out its five points of principle.
On 20 February, an opinion piece in The Straits Times was titled, “It’s getting harder to project future Government revenue”. The author noted that it would become more difficult to achieve Budget marksmanship as there could be variations of 17% to 27% in specific tax collections. His view was that gone are the days when Budget marksmanship of 2% was normal.
Two Budgets ago, I asked what the total estimated amount collected by the carbon tax would be. The Government did not tell us, even though the preliminary numbers would not have been difficult to estimate and probably had already been tabulated by the Ministry of Finance. Similarly, in 2016, the Government announced a $4.5 billion industry transformation roadmap. No proactive update on how monies were spent on these programmes was provided until Parliamentary questions were put to the Government. Surely the Government can do better here.
I have spoken about the Organisation of Economic Cooperation and Development (OECD) Base Erosion and Profit Sharing regime, or BEPS, for some years now. The Finance Minister has laid out two possibilities that could affect us: one, of more corporate income tax being collected; and another of some multinational enterprises (MNEs) leaving Singapore. Both could happen at the same time, if recent media reports are anything to go by: one, predicting the move of more MNE headquarters to Singapore from Hong Kong; and another reporting on the move of Electrolux’s regional headquarters from Singapore to Bangkok.
In view of the implementation of Pillar 2, what are the estimated collections in either an optimistic scenario or a conservative scenario?
At the first Budget debate of this term, WP called for the setting up of a Parliamentary Budget office, which was rejected by PAP as an idea that would only benefit the Opposition. In the spirit of Forward Singapore and in view of a greater need to track the effectiveness of Government policies and their expenditure outcomes, such institutions should be a feature of our democracy and the Singapore that the Forward Singapore report demands.
One economist quoted in the 19 February The Straits Times article said that Singaporeans outside this House desire to analyse and understand to a deeper degree what the Government is doing. These examples I shared put into relief the types of differences we can expect between the political Opposition in this House and non-politician Singaporeans outside of it on the one hand, and the PAP Government on the other. Such calls for information cannot be set aside as red herrings. If the Government was doing well on this score, we would not have private sector economists making the arguments and the points they do.
These calls represent a desire to shape a political environment that is fit for Singapore’s purposes. Singaporeans need to know how much there is to spend and where the money comes from. These are basic requirements for having rational discussions on fiscal matters and for realistic alternative visions to emerge. In any democratic society, the Government must facilitate such discussions and it should do so proactively by declassifying more information if necessary. Sengkang Group Representation Constituency (GRC) Member Ms He Ting Ru will speak on the themes of deliberative democracy, transparency and accountability in her speech.
Coming back to the financing of Forward Singapore’s goals, the Deputy Prime Minister announced that $5 billion of this Budget has been set aside for Forward Singapore policy moves, with around $40 billion to be used by the end of the decade. Will the Government spell out these initiatives in view of the commitment made in the Budget Statement, since some thought appears to have been applied to how much it will take to fund Forward Singapore plans?
Sir, PAP must tell us how the Government will deploy the $40 billion for Forward Singapore policies so that Singaporeans can understand what PAP believes the social compact of tomorrow requires. Just as PAP calls on WP to lay out its alternatives, surely PAP must lay out its proposals, too.
Mr Speaker, my second point is that there is a growing mismatch between the aspirations of Singaporeans and the reality facing them. Steps must be taken to address this. A reference in the Forward Singapore report to the 5Cs of decades past was scrutinised by some in the media. The 5Cs captured the aspiration to have cash, car, credit card, condominium and country club membership. The Forward Singapore report calls on Singaporeans to move beyond the 5Cs towards wider definitions of success. Surely, that is an admission, perhaps unintended, that a fair number of the 5Cs are unattainable for most Singaporeans today.
But I would go further. The reality is that things are very difficult for not a small number of Singaporeans, regardless of what definition of success one deploys. A Business Times article from late 2023 reported the findings of an OCBC financial wellness survey. Fewer Singaporeans can comfortably spend on things beyond the basics. And more do not have sufficient emergency funds or savings to meet their families’ needs. Just 40% of Singaporeans can afford to spend beyond the basics most of the time, down 8% from 2022; and 23% can only afford the basics; while 79% of Singaporeans either do not have a retirement plan or are not on track with their retirement plans. This was a rise from 71% in 2022.
If the sentiments captured in this survey are anything to go by, there is a likelihood that the social compact may be precarious and uneven, particularly if the middle of society feels insecure about their financial future. To address this possibility, the structural moves to invest more in the future, particularly through SkillsFuture, are important and critical, even as the temporary cost of living support with the Budget are acknowledged and welcomed.
The WP foresees a need for even greater investments in our human capital in future, especially in view of how rapidly the workplace landscape is changing and with more well-paying jobs requiring high-order skillsets, a point that will be further expanded by Sengkang GRC Member Assoc Prof Jamus Lim.
The $4,000 SkillsFuture credit, which is ringfenced for selected programmes with better employability outcomes, can be used for part-time diploma, post-diploma and undergraduate courses as well as PWM-specific courses. The WP sees the deployment of SkillsFuture credits towards economically productive courses with employment outcomes as an important policy initiative of this Budget. But we believe that many of the courses are likely to cost more than $4,000.
To further facilitate skills training and help Singaporean workers, the Government should introduce an interest-free SkillsFuture education loan. The WP put this proposal front and centre in our General Election 2020 manifesto. To start with, these loans can be calibrated towards courses, in either high-growth industries that lack Singaporean manpower or in other economically important areas.
Sir, my third point, is that the Government must improve retirement adequacy. The changes to the Central Provident Fund (CPF) Special Account (SA), announced by Deputy Prime Minister, will be addressed by Sengkang Group Representation Constituency (GRC) Member of Parliament Mr Louis Chua.
However, I speak of retirement adequacy more broadly and as an ongoing concern for the decades to come. It did not escape many Singaporeans, that all three core components of the Majulah Package: the annual earn and save bonus, the one-time retirement savings bonus and the one-time MediSave bonus, for Singaporeans born between 1960 and 1973, involved CPF top-ups. The Merdeka and Pioneer Generations will also get them. In total, 1.4 million Singaporeans will see CPF top-ups.
From the vantage point of the WP, Sir, these moves make it clear that sufficiency of CPF balances for retirement is a serious and ongoing concern. The moves to raise employer’s CPF contributions through to the year 2030, must also be seen by employers in this light – of ensuring that all the workers are not left behind when retirement beckons. Employers will have to redesign jobs, so that seniors can continue to work for far longer if they wish to. The real risk of more redundancies in the years to come, arising from job displacement, adds impetus to the need for job redesign.
Recently, in a social media post, the Minister for National Development celebrated the 60th anniversary of the Housing and Development Board’s (HDB’s) Home Ownership Scheme. History shows that the reception to the HDB Home Ownership Scheme, per se, was initially lukewarm. The popularity of HDB flats exploded only when the CPF Act was amended in 1968, allowing Singaporeans to use their CPF funds for down payments and mortgage instalments of HDB flats.
It would not be hyperbole to say: that the CPF changed from a statutory board in charge of Singaporeans’ retirement to a subsidiary of the HDB, with the aim of helping Singaporeans purchase property. Of course, many aspects of CPF policy have evolved since then.
But what is clear, is that Singapore is in a far different place compared to where it was in the early years of Independence. Specifically, younger Singaporeans cannot expect the same home equity appreciation that Singapore experienced from the 1990s. Today, HDB affordability continues to remain an ongoing concern in the minds of many Singaporeans, in spite of the new Build-To-Order (BTO) classification system – which adds new restriction and increases subsidies for new flats.
In substance, the Government appears to acknowledge the point that affordability is an ongoing concern. A point made by the WP in our speeches during the Housing Motion that was debated in Parliament last year, when we sought to bring focus to the People’s Action Party’s (PAP’s) amended Motion.
It was not coincidental that the Prime Minister in his 2023 National Day Rally, referred to the now infamous $877,000 five-room BTO flat in Ang Mo Kio as an example of a BTO flat that should become slightly less expensive under the new Standard, Prime and Plus BTO classification system – thanks to added taxpayer subsidies.
More money set aside for HDB flat purchase means less funds available for retirement, notwithstanding options to downgrade. If property prices and general inflationary trends rise faster than wages, plans for retirement will have to start later for many – since they would have less to set aside for their nest egg, with mortgages to serve today.
It is time to closely examine how much CPF money should be set aside for housing. But if HDB prices continue to escalate, any move to reduce the CPF funds that can be set aside for housing, in favour of retirement adequacy, may backfire.
The Government may then have to commit itself to making HDB flats even more affordable by increasing subsidies further. Make no mistake, direct subsidies for HDB flat purchases do not make HDB flats cheaper. They merely transfer the cost to current taxpayers. The WP will continue to closely monitor PAP’s moves on this point. We will be sure to hold it to account, if it allows HDB flats to continue to rise in price beyond wage growth and if it allows the retirement adequacy of Singaporeans to be compromised. My colleague, Aljunied GRC Member of Parliament Mr Faisal Manap, will make some related points covering housing and low-income households in his speech.
Mr Speaker, my fourth point, is that employers need to show more support for employees. Business groups have expressed concerns about the new Local Qualifying Salary cap of $1,600, which is widely considered as the de facto minimum wage.
However, if Singapore really wishes to embrace the philosophy of Forward Singapore, then we need to show stronger support for our financially vulnerable workers. This is such an important ingredient of the future social compact. Increases of the de facto minimum wage, should be seen as a step towards an inclusive and fair Singapore. If we have a shared future, where there is a lack of support for paying our lowest-paid workers in step with economic fundamentals, that would reflect very poorly on Singapore.
When the economy grows or when support measures are extended to companies, workers must also benefit. But consumers too, must be prepared to pay more for goods and services and it cannot solely be left to businesses to absorb the additional cost of wages.
The strongest social compact promised by Forward Singapore, also offers an opportunity to think about protections for our workers beyond wages. Much has been said about the lack of recognition in Singapore for all blue-collar workers who use their hands to perform skilled work. As the next step, Singapore should legislate retrenchment benefits or introduce redundancy insurance for these workers. I will speak more about this in the Committee of Supply (COS) debate for the Ministry of Manpower.
But there are areas where some employers have done well and displayed solidarity with the Singaporean worker. For example, by implementing Flexible Work Arrangements (FWAs) in concert with the demands of a more modern Singaporean workforce. But FWAs are just one area. We must also improve workplace culture and change attitudes towards skills upgrading and training, if Forward Singapore is to become a reality.
In a recent Ipsos survey titled “What Singapore thinks, feels and does”, it was revealed that three in five Singapore employees – or 60% of Singapore employees – said that they were proud to work for their employer. But this was some 14 to 19 points below the global average; 29% said that they plan to leave their current employer in under two years – nine points more than the global norm.
While pay is one reason, feeling unrecognised and a lack of career progression, are the two additional factors that drive employees to leave. With the advent of artificial intelligence (AI) and the need to improve productivity, this is as good a time as any to significantly review HR policies: to align them with national imperatives and the lived experience of Singapore workers. Member for Aljunied GRC Mr Gerald Giam, will speak more about productivity improvements in his speech.
A citizens panel on employment resilience concluded, as part of Forward Singapore, noted that many workers did not proactively manage their careers until a need arose – due to a lack of awareness of resources for upgrading; or to there being too much information that is too daunting to navigate.
The SkillsFuture Enterprise Credit aims to encourage employers to invest and enterprise, and workplace transformation. It covers an array of programmes, including support for job redesign under the Productivity Solutions Grant. These initiatives can be superimposed on the key HR workplace pain points identified by employees – particularly older workers. Aljunied GRC Member of Parliament Ms Sylvia Lim will speak more on this subject.
This year’s Budget sees the SkillsFuture Enterprise Credit extended for another year. As in previous years, the WP calls on the Government to report on the success, or otherwise, of these enterprise schemes that cause huge amounts of money. Reporting on outcomes is a fundamental requirement for accountability. Please give us information on what outcomes, if any, have been achieved on an industry-wide level. Please let us know so that this House and industry experts outside this House can give inputs on how these schemes can be improved, if necessary.
Sir, I move to my final point. In this uncertain world, Singaporeans need to be committed to being united even as we must remain multiracial and multicultural.
The Budget speech By Deputy Prime Minister Lawrence Wong, sought to put into focus an important message that many of us overlook as we remain peaceful and far removed from the prospect of conflict. The segment of the Finance Minister’s speech that stood out for me was the assessment of the uncertain outlook for Singapore. Some language was particularly strong. These include, and I quote: the international outlook has darkened dramatically; the post-Cold War era that fostered three decades of peace and stability is over; we are now in a new era of conflict and confrontation and there is no turning back; what can we expect in this new world? It will be more violent, it will be more fragmented, it will be messier and more unpredictable.
At the same time as the world is seeing rising political polarisation and disenfranchisement, due to economic displacement, the world continues to struggle with common global problems, such as climate change, a subject Hougang Single Member Constituency Member of Parliament Mr Dennis Tan will touch on.
If Forward Singapore seeks to refresh the social compact to keep our society strong and united and to prepare for a difficult road ahead, all of us in Singaporeans – regardless of our political persuasion – will have to be our siblings’ keeper. More so than ever before.
But this will not be easy. Immigration and integration are good examples of where potential challenges lie. Earlier generations of immigrants had little choice, or less choice, but to integrate. They could not live hermetically sealed off from their host population. Only 30 years ago, it was prohibitively costly to make an international phone call.
Current immigrants can easily stay connected to their networks and countries of birth. One can be a new Singaporean or PR physically present in Singapore, but removed from Singapore society. Better integration between the races and communities must be an important feature of the new social compact. We ignore this social objective at our peril, given how immigration is a permanent feature of Singapore’s society.
The prospect of constant information operations undertaken by state and non-state actors, is an acute threat facing all multicultural societies. As a multiracial and multi-religious society that relies on immigration to top-up the population, our bonds as one united people may be severely tested in the years to come.
The reality of online misinformation of foreign interference, particularly if framed in nationalistic terms, or in the form of identity politics, can be insidious and highly damaging to Singapore.
Even as we seek more space to passionately advocate our views, including those on race and religion, we should be mindful lest we denigrate another group. More communication is certainly needed, but we should never forget our common humanity. None of us chose to be born into our race or religion, so kindness and empathy must be a dominant feature of the multiracial Singapore spirit.
As an opposition party with elected Members of Parliament (MPs) in Parliament, the Workers’ Party will not self-censure but commit ourselves to bring up matters responsibly. Once mistrust between communities take root, we will not know what hit us.
The WP agrees with the posture taken by the Government, that polarisation must not happen in Singapore. And as a society facing an unpredictable world, we should not dismiss this potential reality. We must gird ourselves against this prospect by deepening our commitment to fellow Singaporeans and representing them and their views faithfully.
A potentially more volatile outlook also reinforces the importance of the Singapore Armed Forces (SAF) and Home Team and the importance of National Service. Our security agencies may be tested or challenged in ways that may not just be kinetic, but asymmetric, and we cannot afford to fall short. All Singaporeans must give our men and women in uniform our full support.
In conclusion, Mr Speaker, there is broad agreement on the outcomes sought by Forward Singapore.
But the call for a fair, inclusive and united Singapore must also accommodate and respond to citizen demands for greater transparency and civic participation. Otherwise, Forward Singapore could easily fall victim to political cynicism.
The WP has, on numerous occasions, proposed how these calls for greater transparency can be better addressed. Such calls will not grow softer and they are not inconsistent with the findings and the desired outcomes of the Forward Singapore exercise.
Some of the differences between the PAP and the WP are of methods and approaches, and we must agree to disagree. But there may be a few issues where there is consensus on the final outcomes, and yet, others where there is none. This is how a parliamentary democracy works. A Singapore with a contested and balanced Parliamentary system, with a robust opposition presence playing its role in making for a fair and inclusive society, and ultimately, what it does is that it makes us a better, more confident and an authentic Singapore. Sir, the WP supports the Budget.
Mr Murali Pillai (Bukit Batok): Mr Speaker, Sir, on 21 April 2023, during the debate on the President’s Address in this House, there was an important agreement reached across the aisle between the hon Deputy Prime Minister and Finance Minister, Mr Lawrence Wong, and the hon Leader of the Opposition, Mr Pritam Singh.
Both of them agreed that there is no place for populism in Singapore. Deputy Prime Minister Wong characterised it as follows: “Both sides of the House, we stand for a democracy that is maturing, a serious Government and a serious Opposition. But we say no to populism and political opportunism ever taking root in this House and in Singapore.”
This was a laudable bipartisan moment. It is also recognition of the fact that in countries where populism has taken root, societies have become divided, people have become polarised and the trust between the people and the Government weakened. Singapore should not follow suit.
The agreement, however, presumes that we know what populism is. But do we? Most academics and commentators agree that the core feature of populism revolves around the division between the “people” on one hand and “the elite” on the other.
Cas Mudde stated, “It is a thin-centred ideology that considers society to be ultimately separated into two homogenous and antagonistic camps, “the pure people” versus “the corrupt elite”; populist politicians advocate that they represent the “whole people” whereas the elite represents “special interest”, regardless of the truth of the matter.
The framing of issues is usually confrontational, antagonistic and emotive. This sort of populism – once we see it for the grandstanding and posturing – is really not very hard to reject. It is mere opportunism played out in the political arena. This is what I call “weak populism”.
But there are two further elements to populism. First, it is not always easy to see through grandstanding rhetoric and recognise opportunism in its true face. Second, populism is not always mere words – it also reaches into real policy action with a specific approach, which I call a “fool’s gold” promise.
Populism in action lulls people with the promise of easy money, soft compromises, zero trade-offs. These two elements – words and deeds – make up what I call “strong populism”. And notwithstanding the forging of the agreement in Parliament, there remains no guarantee that this sort of populism will not take root in Singapore.
Structurally, we will always be vulnerable. This is because, as in all modern democracies, we have a representative government, where a minority – that is the elected – represents our people, the majority, and has the mandate to govern. The suspicion that this representation is imperfect will always be there.
We have seen several examples where people’s fears, especially during crises, are capitalised by populist politicians espousing radical change. I will give two examples: one from the right and the other from the left.
In November 2023, in the Netherlands, the Freedom Party, a far-right political party that fanned Islamophobia and anti-immigration sentiments amongst its people, with promises to de-Islamicise the country, made huge electoral gains and was the clear winner by a wide margin. It is poised to feature in a coalition government. Should that happen, it would not be difficult to imagine the impact on the cohesion of the country across race and religion.
Let me identify the specific populist lever here – the use of religion and nativism to divide and polarise a country.
In 1998, the late Mr Hugo Chavez, a charismatic Venezualuan leftist leader, came to power after promising to use Venezuala’s vast oil wealth to reduce poverty and inequality. As President, he launched programmes that offered free or highly subsidised goods. He passed away in office in 2013. His policies continued though. In the end, the country’s economy shrunk and hyperinflation set in, despite it being an oil producer.
Again, let me identify the specific populist lever – which is to use price-distorting policies to give short-term, apparent benefits to people, at the cost of the country’s long-term economic health.
Both these acts are forms of strong populism to me. From my research, I noted a number of writers, particularly Prof Simon Tormey, who have observed that in recent times, the world is facing a populist insurgency. The fact that such political opportunists have taken in so many voters across so many countries, shows us that it is no easy matter to see populism for what it really is.
We, as a country, therefore, need to develop the capability to recognise and emphatically reject this insidious and seductive form of divisive politics. If we do not do this, the consequences for us as a small nation will be serious.
Just last week, I learnt about a speech that our first Foreign Affairs Minister, the late Mr S Rajaratnam, made in the UN General Assembly in October 1971. He said to the effect that small nations need to keep their own houses in order, to be able to secure their places in the world. In other words, small nations need to ensure that they retain social cohesion and political, as well as economic stability for the long term.
The implication is clear. Unlike bigger countries, small nations like Singapore, when they fall victim to divisive politics that populism brings, they will be easy for the picking. They would no longer be taken seriously by their bigger neighbours. Once that happens, small nations would not have the ability to protect and promote their national interests in the international arena anymore. In other words, we will have a “double whammy”, domestically and internationally.
Therefore, our commitment to reject populism in its strong form, must therefore carry a commitment to educate all Singaporeans to recognise it when we see it and call it out.
Which brings me to my second caution. Fool’s gold and the easy choice.
The rejection of strong populism commits us to a specific duty. It is a duty to make hard choices, to be accountable to the people of Singapore, by way of political and practical solutions to the social imperatives of our nation.
The critical difference between this “hard choice” approach and a populist approach to policies is two-fold. First, this should be done without the histrionics that populism often attracts. I must say here that I am for even more scrutiny of policy proposals and performance from political leaders, from both sides of the aisle. What I am against here the chest-beating, sabre-rattling politicisation of issues that get in the way of true analytical discourse. Without the “noise”, there will likely to be better engagement on the substance of the matter.
In the end, there will be clarity on what parties are agreed and what they are not. This is what we should aim for. I feel that this distillation process is essential. Otherwise, there is a danger of performative politics entrenching itself in this House.
Second, I believe details matter. We have reached a point in our country’s development where solutions to most things are complex, and sometimes, finely balanced. It is characteristic for populist politicians to be short on details when advocating for a policy change.
We politicians, from both sides of the House, need to do the homework, understand the background facts, and also understand how the status quo was forged, highlight the trade-offs inherent in the policy proposals, separate facts from fiction and then, go on to make arguments as to why the balance should be struck one way or another.
I would also add one other point. Political leaders in office should eschew the tendency to just label policies as “populist”, even though they may in fact receive broad support of citizens when what they really want to do is to make the policies sound unreasonable and irrational. This is a point that Francis Fukuyama made – and I agree with him.
It is incumbent on leaders to go beyond labelling, highlight the precise aspects of the proposed policies that they are concerned about. It is this process of responsible contestation and distillation of ideas and proposals which, in my respectful view, will serve as a bulwark against the emergence of populism in its strongest form in Singapore.
Through this process, there will be better accountability to our people. Our people, noting the areas where politicians are agreed and where they disagree, will be better placed to choose which future they wish to ascribe to through the ballot box.
Let me underscore the point by making reference to the debate at the last session of Parliament on the national reserves.
In opening the debate, the hon NCMP Mr Leong Mun Wai highlighted what he referred to as “social ills” that must be addressed. These included cost of living, social inequality, mental health and declining total fertility rate. To this list, the hon Leader of the Opposition, in his speech during the debate on the Motion added healthcare costs and intergenerational equity. Both hon Members advocated for the slowing of the growth of reserves so that more money can be spent on these areas.
I, for one, do not see these human conditions as diseases or “ills” but as imperatives for the Government of the day, as moral directions for us to apply our best minds and our utmost resources. These social imperatives cannot be denied, but they cannot be solved by mere handwringing, or by profligate spending. Our duty is to be accountable in the way that I have outlined above, by a serious political commitment and spending our time, energy and resources in formulating and explaining our policies.
Importantly, we need to be aware of the parameters of the hard choices at play and to reject the “fool’s gold approach”.
To explain its hard choice in rejecting even more spending of the income from the reserves, the Government has stated that the reserves provide substantial “passive income” for expenditure in the Annual Budgets and given our unique vulnerabilities, we need to grow the reserves to ensure that we have a chance of overcoming what future challenge that may come our way. These points were articulated so well in my hon friend, Mr Shawn Huang’s speech which I heard earlier today.
Putting aside the use of monies from the reserves for the moment, I think there are two points arising from what both the hon Members have said that will find agreement on both sides of the House.
First, that the social imperatives identified by both of them are legitimate. These imperatives require the attention of this House and the Government. In fact, I would say, as a backbencher, much of what I do in my constituency for my constituents revolve around dealing, amongst others, with such issues.
Second, as responsible MPs, both sides of the House will reject spending for merely the sake of spending. This constitutes fiscal prudence. Hence, to make the case to spend more money will involve taking at least the following steps.
First, an examination of the existing programmes that the Government has for the imperative in question. Second, a calculation of how much the Government is committing or spending on these programmes. Third, a performance assessment or review of the programmes. And finally, the articulation of the case for more spending on the imperative which will have to include dealing with the Government’s points on “passive income” that the reserves currently provide and having sufficient ballast for the future.
At this point, I would like to deal with the hon Leader of Opposition’s point raised in his speech earlier that the Government should be even more forthcoming with information to make better decisions on the Budget.
With respect, this is a red herring. There is already sufficient information available. In fact, at the last Sitting, the hon Prime Minister gave us a Master Class. Hon Members may recall he asked us to take out the back of our envelopes and follow him in doing the sums. He projected that the returns from the reserves at about 4%; he then said if we were to spend 2% for the Budget, that means 2% for the reserves. So, the reserves will grow at a rate of 2% per year and that more or less, keeps up with the GDP. So, we roughly know what is the band of the NIRC which has remained stable and contributes about one-fifth of our revenue.
We also know that the variance of the operating revenue and the expenditures within a band of about plus or minus 4%. Of course, there would be situations where the predictability may be affected by, say, market situations. For example, for property tax, it went up because the AV went up and that is a function of the market.
For that kind of situations, all we can do is we make best predictions and then make adjustments as we go along. But these will be the inputs for which we would have available for the purposes of making sure that whatever we are articulating as policy proposals for more expenditure can be supported and fiscally prudent.
The hon Leader of the Opposition made reference to an article which appeared on 19 February in The Straits Times and he pointed out that some economists had also made the point about lack of information being forthcoming from the Government.
One point to note, as he had stated, is that most economists lauded the Budget. One economist had asked about the use of pre-funding Government programmes, for example, the Pioneer Generation package and he suggested that there should be more transparency in relation to this plan. But the reality is, every year, the statement of accounts is presented to Parliament. That statement of accounts is actually audited by the independent auditors. All MPs can ask questions and it is also subject to scrutiny of the Estimates Committee. And, of course, drawdowns are also subject to scrutiny of the Auditor-General.
Another economist felt that the amount of past reserves should be disclosed. This is something which, as we all know, the Government has a conscientious objection to. But most importantly, as I said earlier, the NIRC amount can be estimated and that is the important part for Budget planning.
For these reasons, I would say that there is no real obstacle for anyone of us in this House to articulate holistically why more money or more resources should be spent for a particular policy imperative.
I will now provide an illustration on the working of the framework that I suggested by dealing with the Cost-of-Living imperative.
In October 2022, the Government unveiled a support package to give Singapore households additional help to deal with rising prices. The amount of monies committed for these programmes is a matter of public knowledge – $1.5 billion.
Deputy Prime Minister Wong, in his announcement, said that the package was designed to fully cover the increase in cost of living for lower-income households and to cover more than half the increase in the cost of living for middle-income households.
It is entirely open to hon Members who wish the Government to spend more to tackle cost of living issues to make the case that the 50% mark is insufficient for middle-income households and argue that it should be higher, say, 60%, 70% or even 100%.
They should articulate how such a move would be in the better interest of Singaporeans and Singapore as a whole. What then this leads to is the crystallisation of a sum that is needed to fund the advocated policy proposal from the reserves or elsewhere with the accompanying reasons.
The political office holder responding to hon the Member’s proposal, if he disagrees with the proposal, will be well advised not to simply shrug it off by labelling it as populist. Rather, he must tackle the proposal head-on and explain why the current spending levels are sufficient and should be maintained, having regard not just to the specific issue but the big picture as well. Through this, we will gain a clear understanding of the points of agreement and disagreement as well as the reasons in support of the respective contentions. Singaporeans will be better able to follow the debate and the implications of the policy proposals should they be implemented or rejected.
It is, of course, open to hon Members across the aisle to make their plans part of their election campaigns even if they may be rejected by the Government. That is their prerogative. But they must have such plans in the first place. If they do not, it is merely promising Singaporeans as a share of a piece of gold that disappears after election day.
I view this as healthy politics as both sides will then present their cases to our people. In the end, it will be fellow Singaporeans who will judge and decide through the ballot box. This is how we prevent populism from rearing its head in our politics. This is how a high level of accountability to our people will be maintained.
Mr Speaker: Mr Murali, you have a minute left.
Mr Murali Pillai: Very well, Sir. If that is the case, I will just end off by saying that the social imperatives are upon us. We all know this and it is no great epiphany to point these out. If we are to really say that we have a serious Government and a serious Opposition, as exhorted by Deputy Prime Minister Lawrence Wong, the focus must fall on the generation of solutions to such imperatives and a reasoned articulation of why these solutions create better outcomes for our people whilst being fiscally prudent. And by democratic acclaim, let us stand behind the ones which we believe, as elected Members, most benefit the people of Singapore for now and the future and by so doing, reject populism in its strongest form. I support the Budget. [Applause.]
Mr Speaker: Mr Pritam Singh.
6.25 pm
Mr Pritam Singh: Thank you, Mr Speaker, and I thank Mr Murali Pillai for his speech.
I have been trying to follow very carefully what he has been suggesting. I think the broad strokes, typical of Mr Murali Pillai, you would not really disagree with them. But in terms of populism, I thought it would be important for me to just come down to some specifics.
He mentioned some references in my speech to the 19 February Straits Times article. I think the point that I made in my speech was that article showed how people outside of this House, Singaporeans, in the context of the Forward Singapore exercise, were also looking at fiscal sustainability, fiscal balance, how the Government raises revenue and its expenditure policies.
And in that regard, the point I made was we had put forth a proposal to smoothen that conversation, to better that conversation for the benefit of all Singaporeans.
I understand he moved on later to talk about certain proposals that we have made for which the PAP has a conscientious objection. I think that is where I would like some clarification from him. If there is a conscientious objection, then what happens to the populism argument? Is it wrong for the Opposition to bring up those points?
The second clarification I have is, again, bringing it down to an example. In this debate so far, we have the PAP Members speak up about building BTO flats in advance. What sort of numbers would the Member expect from anyone across the aisle or even in his own party, raising in Parliament, to substantiate that argument? Some clarity on that would be helpful.
For the moment, I will leave it at these two clarifications.
Mr Speaker: Mr Murali Pillai.
Mr Murali Pillai: Mr Speaker, Sir, I thank the hon Leader of Opposition for giving me an opportunity to clarify certain aspects of my speech.
Let me just take the point about conscientious objection. I would like to clarify that what I was referring to in my speech was in relation to the fact that we do not disclose the full entirety of the value of our reserves. So, that is the reference to our conscientious objection. And it was in the context of referring to one of the economists featured in the article which the hon Leader of Opposition referred to. There, the economist said that we should know the full amount; then, we would know whether the spending is high or low.
The reference to conscientious objection is really the arguments made by the Government in the Motion on national reserves which I am sure the hon Leader of Opposition is familiar with. But more importantly, I made the point that for the purposes of the Budget, if one can calculate the NIRC already and I made reference to the hon Prime Minister’s masterclass, in relation to how the reserves are projected to grow and the fact that the NIRC contributions are relatively stable.
As far as the issue of the purpose of referring to the article itself, I take the hon Leader of Opposition’s point. I understand that it is really with the view to provide further feedback on the Forward Singapore exercise and I welcome them.
Finally, the point that my hon friend referred to is in relation to the building project of HDB. If we were to go through the analytical framework that I have suggested, the point is really about a Member of the Opposition, for example, articulating that even more houses should be built than what the Government is proposing, then what really needs to be done is to, first, identify the programme, highlight and find out how much exactly is being spent or committed for the purposes of building X number of flats, for example, and then also, in the same process, nail his colours to the mast and say exactly what he stands for in relation to the number of flats that is to be built, why is this important and then deal with the financial issues by reference to the allocation of the spend for the other aspects of the Budget as well.
What I think would happen through this articulation, using this framework, would be a laudable outcome, which is that the people of Singapore outside this House would know that it is something that is being proposed, there is seriousness in the proposal because the facts and figures are there and then you could juxtapose what is the Government’s position on the matter against the hon Member’s position.
Mr Speaker: Mr Pritam Singh.
Mr Pritam Singh: Just a quick response to Mr Murali Pillai on his clarifications. In the case of the BTO example that was raised as part of this debate by a PAP Member, that example then would actually fail the test that Mr Murali Pillai has brought up. Similarly, when other Members on the other side say we want to introduce a scheme, such as Carefare, or they speak of — nobody said cost of living crisis, but I heard affordability crisis today by PAP Members. I am assuming that in Mr Murali’s schema, that analysis would also have to follow. Just for clarification.
Mr Speaker: Mr Pillai.
Mr Murali Pillai: I thank the hon Leader of the Opposition for pointing out and asking whether the framework I have applies to hon members from both sides of the aisle. The short answer is yes. This is an exhortation not specifically to the hon Leader of the Opposition, or rather, hon Members from across the aisle, but it is actually from both sides of the aisle. And for anybody who wishes to make a proposal that involves extra spend, then you need to go through the analytical framework and I think then there will be clarity as to whether or not, ultimately, it is in the better interest of Singapore and Singaporeans to proceed with the extra spend.
Mr Speaker: Mr Pritam Singh.
Mr Pritam Singh: Just a last clarification. So, just to push the Member a little bit more. In the case of a commitment made by the Government, for example, to spend $40 billion up to the end of the decade for ForwardSG initiatives, should these also be laid out earlier?
Mr Speaker: Mr Murali Pillai.
Mr Murali Pillai: Mr Speaker, Sir, I am happy to be pushed by the hon Leader of the Opposition. I think I will just basically deal with it on a point of principle, and while he can take suggestions from my colleagues from the PAP, I can also refer to suggestions made by hon Members from his party. I still remember an example of setting up the Parliamentary Budget Office and that was a proposal made in this House and there was really no understanding as to how much money that would entail in not just setting up the office but in terms of its operations as well.
So, I would rather that the points I made not be obscured. Let us stick on the principle and the focus is really to make sure that the ugly head of populism does not rear in our politics. And, thankfully, that is a bipartisan point and I do hope that, on both sides, there will be an opportunity to reflect on the contributions I made in this House.
Mr Speaker: Assoc Prof Jamus Lim. You have a clarification for Mr Pillai?
Assoc Prof Jamus Jerome Lim (Sengkang): Thank you, Speaker, for the opportunity to clarify some points made by the Member Murali Pillai. I would just point out two things.
First, I would respectfully disagree first that, with his claim that just because all the necessary information was provided by Prime Minister Lee with regard to this back-of-the-envelope calculations, it would be therefore reasonable for us to take his calculations as self-evident.
Let me be clear, far be it for me to challenge the first Wrangler in Cambridge for his Maths. But I believe that he introduced a number of assumptions about expected returns to reserves and GDP growth and, indeed, about the amount that would be returned to the reserves based on the way that the Government calculates the primary surplus vs the IMF recommendations.
So, my question is: if the Member accepts that these assumptions are not necessarily self-evident, is it reasonable, in a debate, for us to question these assumptions?
My second point builds on this and I ask if the Member would think that the Government would be comfortable with making the kind of public policies that they have proposed just based on the publicly available information that is currently available to the Opposition or whether the Government would actually require more information that is not made publicly available.
Mr Speaker: Mr Murali Pillai.
Mr Murali Pillai: Thank you, Mr Speaker, Sir. Sir, in reference to the hon Member Assoc Prof Lim’s first question about the propriety of the assumptions, this is a point which has been discussed at length. Let me just say that what is relevant for the purposes of the Budget is the proportion of NIRC. Even if we were to put aside the assumptions of growth, the fact is that the NIRC, which is reflected in the Budget, has been relatively stable and it is now for every dollar that has been spent, 20 cents comes from NIRC. So, from the perspective of anybody proposing to spend more, these facts would be important.
I do accept that my hon friend across the aisle may have a different view about the extent of the information that is needed. But the point I am making, and I guess we can agree to disagree, and I said this advisedly, that this actually is a red herring. Because all the information needed to calculate revenue is there, in terms of NIRC, in terms of the operating revenue expenditure which falls more or less within a defined variance as well. So, for these reasons, I think we are not disadvantaged.
As far as the second point is concerned, and I stand corrected, I think my hon friend mentioned about whether the Government would be comfortable—I am sorry that I kind of stopped there, if the hon Member could just clarify the purport of his question, I will try my best to answer.
Mr Speaker: Assoc Prof Lim.
Assoc Prof Jamus Jerome Lim: Yes, my clarification is simple. The Government routinely makes policy. So, my question is whether the Member thinks that the Government would be willing to be comparably hamstrung in terms of only making public policy on the basis of all the publicly available information or they feel that the Government can only make policy when there is additional proprietary information.
Mr Speaker: Mr Pillai.
Mr Murali Pillai: Thank you, Sir. I think there is a false premise in the question. It is about the Government being hamstrung in relation to public information. I mean the point is this. As far as the Government is concerned, it puts out the operating revenue, it puts out the proposed operating expenditure and there are, of course, constitutional requirements to make sure that the Budget is balanced and it is against that backdrop that we can do the analysis as to whether the proposals meet the aspirations or the requirements of Singapore and Singaporeans for now and the future. So, I see this as based on a false premise and, therefore, I will not answer the question.
Mr Speaker: Assoc Prof Lim. Hopefully, it is the last clarification.
Assoc Prof Jamus Jerome Lim: Much obliged, Speaker. I will be very brief. So, the Member Murali has mentioned repeatedly that there is a red herring, that we have all the information that is required based on the fact that the share of NIRC is stable. My question to him is simple. Does he think that this stable share has nothing to do with the assumptions about expected returns or GDP growth?
Mr Speaker: Mr Pillai.
Mr Murali Pillai: Mr Speaker, Sir, as far as the issue of it being stable, that is an empirical fact. So, that is something that is being set out in the Budget Statement. So, as far as contributions are concerned, of course, there is a certain projection and is made by reference to a certain framework. So, there is no — I mean, subject to the assumptions inbuilt in the framework, it is not just plucking a figure out of the air.
26 February 2024
https://sprs.parl.gov.sg/search/#/sprs3topic?reportid=budget-2328
Office of the Leader of the Opposition 