TOC spends 5 minutes with former CEO of NTUC Income, Mr Tan Kin Lian, and asks him for his views on this Straits Times report – “Gamblers spent estimated $4.2b on 4-D” – about how more S’poreans are turning to gambling.
TOC: Do you think Singaporeans are turning to gambling because of the record-high inflation rate we are experiencing?
Tan Kin Lian: I do not consider most people who buy 4D or Toto to be gamblers. Many of them enjoy the excitement of these games of chance and are willing to set aside a certain amount each month for this fun. If they bet within their means, the games should be considered as entertainment. They could have spent the same amount of money for a concert, show, travel or vacation. If they find 4D or Toto to be more fun, let them enjoy it.
However, I consider the people who bet on 4D or Toto with large sums beyond their means to be gamblers. They may have to borrow money for their bets, or deny their families of the money for their essential expenditures. This should be discouraged, although I do not know how.
Gambling is just one way of getting into financial difficulties. There are other ways of spending beyond one’s means, such as buying expensive clothes, jewelry and other luxuries. We need to address the issue of financial responsibility in a more holistic way.
TOC: In an earlier Straits Times report (see here), it was said that more low-income earners are gambling bigger sums. In your opinion, what do you think will be the consequences of this in the long term?
Tan Kin Lian: We need to educate the lower income people on the need to save for the future. Many of them do not have adequate savings. If they have to meet a medical bill or other unexpected expenses, they have to borrow and pay high rates of interest.
We have to provide the avenue for these lower income people to get a reasonable rate of return on their savings. The interest rate paid on bank deposits is too low. Other financial products offered by the financial institutions and life insurance companies have high front-end charges that give a negative return for most types of savings, if they are not kept for many years.
If attractive financial products are available, it will be easier to convince many people, including the low income earners, to save for the future.
TOC: With the govt’s repeated claims that it is already helping low-income Singaporeans – through cash handouts, vouchers, schemes like the WIS, and even raising the Public Assistance amount – why do Singaporeans still feel a need to gamble?
Tan Kin Lian: I hope that the recipients of the various help schemes use the money and vouchers to meet their food, healthcare and other essential expenditures, and not gamble the money away.
I hope that most people who buy 4D and Toto use money that they can afford to spare. Let them have their fun – they can look forward to the chance of winning a big prize.
There are a small percentage of people who are gambling addicts. They borrow money to gamble. They gamble away money that should be put to better use. I hope that this problem is not serious. They should be addressed separately.
TOC: The government has allowed almost every NTUC Fairprice supermarket to have a Singapore Pools or Turf Club outlet on its premises and these are mostly in the heartlands. Do you think this encourages Singaporeans to gamble?
Tan Kin Lian: In my view, these outlets provide a means of low cost entertainment for their customers. For most people, these games of chance are a way to enjoy life in Singapore. It is a useful distraction from the hard work that they have to put in every day.
If we wish to talk about the ills of gambling, we must not forget that larger sums of money are involved in gambling on the stock, currency, options, commodities and derivative markets. These so-called investors may not be aware about the risks, especially if they are involved in investing on margin accounts.
TOC: Are you worried or concerned that such easy access and availability to such betting outlets will, in the long term, inculcate gambling habits among our young, if they haven’t already?
Tan Kin Lian: I consider the risk of a gambling habit to be only part of a larger problem. We need to educate our young people about financial responsibility – to spend within their means and to avoid incurring debts that attract high rates of interest.
They are so many ways of getting into financial trouble. The most common appears to be over-spending on luxurious purchases that they cannot afford or do not need. The easy credit terms, with high hidden rates of interest and other financial charges, appear to be more risky for the young people.
At least the stakes and rules for 4D and Toto are more transparent, fair and regulated. Many financial products offer a poorer deal to the consumers, but are approved as “investment products”.
TOC: According to the Straits Times report, 4-D taking “were up more than 10 per cent from the 2004/05 financial year ($906 million.)” What do you think the govt should do with the revenue collected from this?
Tan Kin Lian: The government revenue from these games of chance is already put to good use in supporting many community projects.
We should be asking about the use of the larger amounts of government revenue from ERP, GST, foreign workers levies and other taxes. Anyway, this is the job of the Minister for Finance and should be left to him to deal with these matters.
TOC: Finally, is this a sign that when the two IRs (casinos) open for business, the situation will worsen?
Tan Kin Lian: There are already many ways for reckless people to get into financial ruin, including the stock market, foreign market, hedge funds, turf club, cruise ships, internet betting and casinos in overseas countries. The budget airlines make it quite easy to visit these offshore casinos.
The opening of the integrated resorts (i.e. casinos) in Singapore will not make a significant difference to the supply of gambling, which is already plentiful. I hope that the integrated resorts will really have the positive impact of improving the entertainment facilities in Singapore.