Excessively charging for an essential need, and calling it affordable because people still can pay for it?

Excessively charging for an essential need, and calling it affordable because people still can pay for it?

Say one day, the Government goes crazy for money and starts charging each individual an air-consumption tax based on their average air intake at about 100 dollars minimum. Those who cannot afford it can apply for assistance on a case-by-case basis via social workers.

Would it be right to say that such a tax is affordable to everyone since everyone can and is “willing” to pay for it?

While this hypothetical situation may sound ridiculous but the point here is to question the term “affordable” when people are being charged for their essential needs and if it is justifiable.

The Singapore Government have said HDB flats are affordable as many Build-To-Order (BTO) HDB flat buyers service their mortgages entirely via their Central Provident Fund (CPF) contributions with little to no cash outlay, while using less than 25 per cent of their monthly income to pay for their housing loans.

But the thing here with their justification is that those who can not afford it would not buy and cannot be qualified by the Housing Development Board (HDB) to purchase the flats, to begin with.

And those who cannot afford to pay the monthly mortgages after they have bought the flat due to changes to income or unforeseen circumstances would have given up the flat by selling it off.

As accommodation is one of the essential needs of humans, people will nevertheless have to swallow any complaints they might have about the price of the BTO HDB flats and ballot for them.

While the HDB scheme has worked well for Singapore for the past couple of decades, there is not wrong to say that the current prices of HDB flats are a cause of anxiety for many planning to start a home or those sparring a thought for the future of their children and grandchildren.

The escalating prices of HDB BTO flats, in a way, are spurring more people to ballot for the flats. Not because it is affordable as the Government would want you to think, but the “kiasu” mentality of Singaporeans that compels them to buy as soon as possible before the prices go any higher. Therefore, the claim that the increase in applicants signifies the HDB flats being affordable is nothing but a fallacy.

And before someone cites the argument by the Government that it is a raid on the national reserves to price public housing without factoring in land cost and existing market prices, we have to remember the supply of HDB flats is a public housing policy to address the essential need of the common people. A public service provided by the country’s accumulated wealth via taxpayers’ monies and the sacrifices of many whose properties were forcibly acquired under the Land Acquisition Act at negligible cost

Some may argue that buyers can profit from the sale of their HDB flats by selling them in the resale market, but how many buyers do that in reality when the only reason for buying their flats is to have a place to call home?

As the Selective En bloc Redevelopment Scheme (SERS) at Ang Mo Kio Avenue 3 has shown us, asset enhancement via the sale of HDB flats for the purpose of retirement is not feasible as what it has touted to be due to the depreciating lease and the need to procure an expensive replacement flat to stay. Therefore, what benefit is it for the majority of Singaporeans who have no wish to relocate from the nest with many fond memories to have the price of HDB flats rise at the rate we are seeing today?

The Government has insisted again and again that HDB does not profit from the sale of HDB flats, and seeks to justify the pricing of the HDB flats through the cost that it pays out for the construction of the flats and the price of land. Yet, at the same time, it had repeatedly refused to reveal the breakdown of the cost per HDB unit as it did in 1988 when former Potong Pasir SMC MP Chiam See Tong asked for it. To the point of absurdity when Indranee Rajah said in Parliament that the data is not helpful or meaningful when Pritam Singh asked for it to be provided.

Leong Mun Wai and Hazel Poa will be debating the issue of public housing via a motion in the upcoming Parliamentary session, National Development Minister Desmond Lee has also filed a competing motion on the same topic.

One would wonder if it will be a repeat of the session in September last year, where Members of Parliament from the People’s Action Party (PAP) threw all sorts of allegations and character assassinations against the Non-Constituency member of Parliaments from the Progress Singapore Party (PSP) but hardly any clear answers or figures were provided by the ministers.

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