SINGAPORE — The Secretary General of the Progress Singapore Party (PSP), Francis Yuen, has written a Facebook post in which he defended the party’s proposals for the use of returns on investment from the national reserves to fund social programs, including an affordable housing scheme and to support a lower cost of living for Singaporeans.
In his post published on Sunday (26 Feb), Yuen argued that saving half of the returns on investment and using the other half as a contribution to the budget under the Net Investment Return Contribution (NIRC) is no different from personal savings, where spending less than the interest earned does not reduce the original amount saved.
Mr Yuen went on to criticize the People’s Action Party (PAP) government for dismissing opposition parties’ ideas as “raiding the reserves,” and called for greater transparency in how much reserves the country has and how much is needed in the future.
“When PSP recommended to use more of the ‘interest’ earned to help fund programs including the affordable housing scheme and lower cost of living, how do these constitute raiding our reserves?”
“This government has offered no compelling reason to not rethink about using our returns on reserves. To keep harping that alternative parties’ ideas to fix broken policies amount to “raiding the reserves” is now sounding like a broken record.”
“…to claim that we should keep building our reserves for future generations is meaningless if there is no transparency in how much reserves we have in the first place and how much we need going forward,” wrote Mr Yuen.
He also emphasized the importance of taking care of the current generation, many of whom are in dire need of support, rather than simply building up reserves for future generations.
“The current generation have worked so hard to build up the current reserves. Many are now in dire need for support. Shouldn’t they deserve to benefit from higher spending on the NIR , rather than burdening them with higher taxes, levies and spiraling healthcare and housing costs?”
“It’s also obvious that the well-being of our future generations depends highly on how well we take care of the present generation.”
Mr Yuen, in his Facebook post, also called for collaboration between alternative parties and the PAP government to explore creative ways to make life better for the current generation, emphasizing that no party has a monopoly on talent or solutions.
“So instead of dismissing good ideas with the tiresome ‘raiding our reserves’ rhetoric, this government ought to work in the spirit of collaboration with alternative parties to explore creative ways to make life better for our current generation.”
Government entitled to say Opposition proposals as raid on reserves: Indranee
The context of Yuen’s post is the ongoing Committee of Supply for the Budget 2023 in Singapore, during which PAP MPs have been characterizing opposition party proposals as “raiding the reserves”.
These actions have spurred PSP’s Non-constituency Member of Parliament Leong Mun Wai to ask the Finance Minister to define what is deemed “raiding the reserves”.
In response, Ms Indranee Rajah, Second Minister for the Ministry of Finance, stated that there is essentially a framework for how reserves should be used, and when the principal is drawn down or alienated and not put back, it constitutes a draw on reserves.
When asked why the PAP government uses the term ‘raiding the reserves’ freely rather than stating that the proposals do not fall within the framework, Ms Indranee said that the government is entitled to use the term when the proposals fall outside the framework of how reserves are used.
Among PSP’s proposals are the Affordable Homes Scheme, based on a deferred land cost idea first proposed by PSP member Dr. Tan Meng Wah in 2013, which would allow Singaporeans to buy new flats at a “user price” equal to the construction cost plus a notional location premium, and the Millennial Apartments Scheme would see the government keep a large stock of quality rental flats to provide young Singaporeans with more housing choices.
Mr Leong emphasized that these proposals would not “raid the reserves” and would provide affordable owner-occupied public housing and enough for retirement without having to downgrade HDB flats to the government.
In his Budget speech, Mr Leong also introduced an Alternative Budget Proposal where $4 billion will be budgeted for the nationalization of the MediShield and CareShield schemes, which will relieve middle-class Singaporeans of the anxiety over ever-rising healthcare insurance premiums.
A budget of S$3 billion will also be set aside for a living wage that guarantees a minimum monthly take-home pay of S$1,800 for all Singaporean workers and S$1 billion to help the disadvantaged segments of society by doubling the ComCare pay-out for the poor and providing an allowance for caregivers and stay-at-home parents in recognition of their sacrifices and contribution to society.
All in all, PSP’s Alternative Budget, with a proposed net spending increase of about $8 billion, which Mr Leong says is only a fraction of the excess resources available.