During the Budget 2023 debate in Parliament on Friday, Singapore’s Deputy Prime Minister and Finance Minister Lawrence Wong made several attacks on the opposition parties and their proposed policies.
In his sum up speech, Mr Wong emphasized the importance of properly diagnosing the underlying causes of the current housing challenges, as failure to do so can lead to misguided solutions,
He noted that during the period when HDB resale prices fell for six consecutive years from 2013 to 2019, the methodology for pricing Built-To-Order (BTO) flats was the same as it is today, but no one was overly concerned about the prices of new flats when retail prices were falling.
“I say this with some perspective because I was in MND (Ministry of National Development) during the period when HDB resale prices came tumbling down. They fell for six consecutive years from 2013 to 2019. And at that time we used the same methodology to price BTO flats then as we are doing now. But when retail prices were falling, no one seemed to be unduly concerned about the prices of new flats.”
Mr Wong then referred to the Workers Party’s 2019 proposal, which he claims had called for cutting back the annual BTO to just 9,000 flats to prevent an overhang of flats, noting that HDB did not take that advice. He explained that the pandemic disrupted Singapore’s BTO building program and led to increased demand for resale flats, resulting in the current supply-demand imbalance.
He said, “Indeed, if we had adopted the WP proposal…and the subsequent proposal to allow singles aged below 35 to buy new flats, we would be facing a much bigger supply-demand imbalance today.”
In response to Wong’s statements, the Workers’ Party (WP) Secretary-General Pritam Singh criticized the PAP for omitting the broader context in which the Workers Party’s working paper, titled “Counting Down to Zero: Are There Alternatives to VERS?”, was written.
The paper looked at longer-term forecasts of the housing sector and was released in response to the Voluntary Early Redevelopment Scheme (VERS) which the Government rolled out to address the concerns of voters on the value of their HDB flats due to the declining lease.
Mr Singh who is also the Leader of the Opposition, said, “The paper was about looking at longer-term dynamics in the housing sector, and a section of the paper did refer to the number of BTO flats that HDB should build. But that was in the context of a much larger and longer-term discussion about housing policy in Singapore. It was not a call to action, and it was not a proposal.”
“Naturally, the housing paper looks at a longer-range forecast of the housing sector and that was the context which I have not heard any PAP MPs speak about. In fact, they seem to be quite silent about it,” he said.
“On this note, of course, I have to, then, come to the irresistible conclusion that it is a convenient distraction because if indeed the point that was raised in the housing paper was critical, then the PAP would have raised it last year when the WP called for more HDB housing for singles,” he added.
Mr Leon Perera, WP MP for Aljunied GRC also chimed into the exchange and said that the People’s Action Party (PAP) seems to be doubling down on this incorrect assertion, using its tremendous public relation and communicative machinery to repeat this assertion about WP.
In recent days, WP had to issue a statement and post letters on forums as the MPs from PAP, and its supporters have been repeating the claims made by Minister for National Development, Mr Desmond Lee that the WP’s housing paper called for a cut in BTO flats in 2019.
Giving an explanation to the paragraphs cited by Mr Wong, Mr Perera said, “If you look at the sentence, what the sentence is saying is not that there is an imminent risk of vacancy. It’s not that there’s going to be vacancies in 2022. Do you think that there will be a risk of vacancies if you continue to build following this kind of pattern? So there’s no time frame attached to that.”
During the exchange, Mr Perera said, “I would really question if the People’s Action Party has become a party that propagates falsehoods to gain political mileage. The first paragraph makes observations about the risk of vacancies in the context of a paper on longer-term housing dynamics, that resale prices will inevitably come under pressure at some point… But the call to action comes in the second paragraph, which says, BTO projects should continue.”
In response, Mr Wong said, “And no one was talking about building more flats. I mean, and think of everyone was asking, cut back, cut back, cut back. No one was building more flats. With the benefit of hindsight now, it’s so easy to say build more. But I just want to have some perspective here that during that time when retail prices were coming down, it was a very different context. It was a very different circumstance. And we can just put up what the Workers’ Party said, and everyone can be the judge of it.
