Do You Know Why the PAP Government Prefers to Fine Companies and Conduct Reviews?

Do you know why the PAP government prefers to fine the companies when they have flouted the rules? For example, why would they prefer to fine SBS Transit or SMRT for not meeting the minimum requirements for the service standards? Do you also know why the government prefers to give us rebates (GST Credits) or why the government won’t want to implement a minimum wage? You’ve always heard people say about how they are only taking money out of money pocket and putting it into another. But what do they mean?

This is how:

  1. When you fine the company, the money from the fine goes into increasing the revenue.
  2. The surplus from the revenue becomes the reserves.
  3. The reserves are then invested into Temasek and GIC.
  4. When Temasek and GIC makes a high interest, where does the interests go?
  5. Temasek and GIC own the richest Singapore companies. Some estimate that what this means is that the government owns about 50% to 60% of the companies in Singapore. Some people imagine this would be 90%.
  6. Temasek is also a majority shareholder in many of the richest Singapore companies – and in SMRT as well.
  7. So, when the government fines SMRT, this money is eventually channelled back to SMRT.
  8. Effectively, that’s what people mean when they say that the money stays within.

I saw a post on Facebook where the person asked why the government didn’t choose to give free rides, instead of fine the companies? The reason is this:

  1. If you give free rides, this means the government ‘returns’ money back to the people.
  2. This money doesn’t get channelled back to the government and doesn’t go through the whole process that’s described above.
  3. The thing is when the government fine the companies, the money is retained within them, but at the same time, people continue to pay fares to SMRT, so there’s still revenue generation for SMRT.
  4. But when the government doesn’t fine SMRT but give free rides, this means SMRT’s revenue will not increase.
  5. If you are a government which wants to make money, you want to ensure people pay out of their pockets into taxes, you want to make sure people pay out of their pockets into the profits of this company.
  6. So, when the companies have any wrongdoing, you must ensure that you protect these channels of making money, so any ‘punishment’ you devise cannot encroach on these channels and must be a channel which can symbolically represent the punishment but allow the money to be retained within your control.
  7. Fines are something Singaporeans have accustomed themselves to as a strong symbol of punishment, so you do that.

Then, why do they prefer to give rebates for any price increases, and prefer not to implement a minimum wage law?

Here’s why:

  1. When you give rebates, it’s temporary, you can decide how much you want to eat into your own money.
  2. But when you implement a minimum wage law, the money goes directly back to the people.
  3. Then, the people can decide whether to increase spend more, or not, which becomes dangerous for the government, because they cannot determine whether the person will spend. This cripples one of their channels, which is where you want people to pay to make profits for the companies.
  4. If people choose to save or invest the money, the interest goes back to them, according to market rates, and that’s why again, you cannot get the money back.
  5. Which is why, the government usually prefers to offset any price increases by tying it back to the CPF – by increasing your coffers in CPF.
  6. But what is really happening is this – when your money goes into CPF, it’s invested in Temasek and GIC where the interests earned are not channelled back fully, so that they can retain the money. As mentioned, if you invest the money by yourself, the interests go back to you, so they would prefer to lock it in the CPF.
  7. And as I’ve shared in my previous articles, we are withdrawing lesser and lesser from our CPF since 2001, which means the government gets to retain more and more, which is not returned.
  8. Back to rebates – rebates are a temporal increase whereas increasing your wages is a permanent increase. If you increase rebates, you can control how much you want to lose, and this is only a temporary loss. If you increase wages, it’s a permanent loss to your money. This means a reduction in profits all across the companies they own, as they had to pay for the wage increase of their employees.
  9. Not only that, there is no guarantee that when people’s wages are increased that they will spend more, which means lesser profits.
  10. So, if they implement a permanent solution of implementing a minimum wage, this will reduce their profits (from increasing wages and an increase in spending which is not matched up).
  11. Thus they prefer to implement a short term temporary solution to create the illusion to make you think that they are doing something to help you, and when you forget, they can continue to profit.
  12. Also, they prefer to channel any help they give back to ‘your’ CPF, so that they can continue to profit, instead of have you profit, if you make your own investments at market rate.

Then next, do you know why recently, they are doing reviews for any suspicious activity (e.g. Aim), or even conducting Our National Conversation?

They are doing this as a delay tactic, to wait out for any elections that need to occur.

Suddenly, right before the by-elections, they have decided to call for a review of housing policies as well as a review of the town councils. Why?

  1. The solution is pretty clear to us what needs to be done for the housing prices and town councils right? Why do we need a review?
  2. This is because the by-elections are coming up. So, you want to tell people you are conducting a review, so that it seems that you are doing work – we imagine that with a review, there will be answers and our questions will be answered, and we might trust them and vote for them. Never gonna happen.
  3. Remember after General Elections 2011, they put in a new man – Mr Wah – to deal with housing prices. Prices have continued to soar. Not gonna happen.
  4. So now, there’s an election coming up again, albeit a local one – and you want to tell people you are going to do a review, wait it out for until the elections is over, wait a few weeks or months, then announce the outcomes of the review, which won’t amount to anything much, then push through what you want again anyway.
  5. Again, what happened after GE 2011? Did anything change to housing prices?
  6. The review is a nice-sounding word to make you THINK they are listening to you. Not happening.
  7. So, the same principle applies for Our National Conversation.
  8. How long more do you have until the next general elections? 4 years?
  9. Do you want to start implementing solutions that the people want in 2012 or 2013? No, that’s too long. 4 years to change things mean you have to change many things, including policies which you have put in place to earn money. And if you are forced to remove the policies, you will lose profits.
  10. So, conduct Our National Conversation. Estimate how long you want to delay before you have to do anything, then work backwards and decide how many of these discussion sessions you need to do.
  11. The ‘conversations’ will go on this year. Meanwhile, it might take another year to sieve through your feedback and maybe another year to develop solutions.
  12. By then, it will be 2015, maybe 2016. They can implement one or two token solutions and share with you what they’ve ‘reviewed’ and tell you to vote for them to implement all these ideas.
  13. Then, you vote for them, and they can forget about it until a year before the next elections.
  14. And then, it’s about how drawn out they can make this last – how long you can be kept in this illusion.

Welcome to Singapore. Where you’ve been had and you don’t even know it.

Well, what can you do then?

  1. Don’t fall for it! Don’t fall for these ‘reviews’ which are just a show. Don’t fall for any finishing up of a shopping mall which has been left unfinished for a year. God knows how long the shopping mall has been left undone so that when the time comes, it’s a convenient excuse.
  2. Don’t fall it – don’t let them have the power – to override you.
  3. No, YOU override them! Don’t let them push your buttons. You push them back!

What this means is also that we need to advocate a delinking between the government and the economy.

  1. Should the PAP government also be the owner of the economy? What are the implications?

  2. What will be the planning principles of PAP if their interests are also in maintaining the profits of the company? What will their focus be? Since 2008, your real wages have dropped. Since 2001, what we withdraw from our CPF has dropped. Since 2001, profits of the Singapore companies they owned have kept increasing. And more.

  3. What will be the implications when the opposition forms the government? What will an economy owned by the PAP government mean when that happens?

  4. You want a government which is not so tightly linked to the economy.

You want a government that is able to function separate from the economy – there are major implications to how their fundamental thinking towards governing us, or not, and there are also major implications as to the stability of the government, and Singapore, if PAP loses power.

So this is what you need to do – vote the opposition into power. And let them form as many a team as they can, then make them work for you, and for us, to advocate for policy change, and to ensure the government can stand independently on their own, and that the economy won’t be used to hold us ransom when the time comes.

Residents of Punggol East, whatever you do with your vote is very, very important. We have a government which has forgotten who it serves. We have a government which only has its own self interests at heart. We want a government which cares for us. We want a government that listens and respects the people. We want a government that knows that they should honour the power of the people. Singaporeans, we should have the power to change things, and be respected, to be heard and to do things for ourselves. We hold the power to change, and to the Singapore that belongs to us, where we are the builders of our country. Singaporeans, the power is in our hands.

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6 comments

  1. vin8tan

    Wha your article title very misleading and very luan… and untimely. but since it’s out, lets discuss. I’ll just focus on the transport issue. It has been discussed till death by people, and many suggestions to alternative actions, fines may be the easiest way out, but if the fines are regulated and do not flow back into the government’s coffers then I think they should be fined, and fined heavily. The accumulated fines can then go on to benefit the less fortunate (this is definitely not my idea. i think i heard or read it somewhere.)

    My suggestion would be to fine and use a point system like our motorist. e.g. SMRT and SBS is awarded 24 points when their license is granted to run a line, it should be a fixed period of times, say for 5 years. Then points are deducted for every breakdown or disruption to service. e.g 0.5 points for breakdowns that last less then or between 1- 3 hours, 1 point for anything beyond but between 3 and an additional .5 point for every hour thereafter. once it hits critical zero or if the points fall below 3, the route is open up for bidding.

  2. vin8tan

    Oh i forgot to add that, it’s not just about deducting, it should be a very forgiving system where if they do certain things they can earn back the points
    e.g.
    – buying enough buses to make sure service quality is kept at a steady rate,
    – retrain workers to keep them updated and passing two test in a 6 months period
    – service buses more times then the recommended
    – passing an external audit

  3. SE

    This is an excellent post. Succinct and on point. All voters, including Punggol East should read this and understand its implications.

  4. Anthony Sim

    The points made are pretty clear. To test democracy at play, I respect the opinions you have made. May I say, the Singapore government and its economic policy is one of envy by many developed nations. This is thumps up! for sure.

    Have you heard of the Singapore Inc? Singapore is a business enterprise. That’s where the government must have access to the hugh reserves of the peoples’ CPF. There is nothing wrong with that. This system works well because it is super safe with a guaranteed returns. Although it may not justify CPI (Consumer Price Index) thus the value of money may become much less. Well, I know too well because if you compare the Australian Superannuation (similar to our CPF) , last GFC, it had wiped almost 30% to 50% of the Australian retirement savings. But then the account holder has the option of putting his money with any approved Super Funds entity and as an investment, whether he gets a better returns or loss, it is the risk of the individual and there is no pushing blame should anything went wrong.

    I believe the government should be more transparent, after all its the peoples’ saving or stakeholders, may I point out, who work so hard for.

    I will make a point here. The government must now somehow cut the umbilical cord. Singaporean are now grown up and much more educated than before. As custodians of the people, they should not treat their charges like children.

    I think Singaporeans should not be only whingers, they should look hard within themselves and start questioning everything in order for action to be taken and changing for the better in the clear understanding the people and the government are working in tandem. A win win situation.

    I have not been following or have been duly updated of the political and environmental scene. So pardon me for my lack of information. I did not know then about this blog until recently and I elated with the dynamics which I never thought would happen in my life time.

    Sorry Roy, I would have to defer with your take on transportation, public transportation per say. Again, the public transportation in Singapore (including Taxis) are one of the most efficient and possibly the cheapest. I am comparing with the sorry state of those in Australia.

    Minimum wages in relation to the cost of living is relative. I don’t know how this works in Singapore currently. Where I am living now, in Sydney, there are minimum wage regulations. For example, positions for shop assistants, waiters or any entry level positions are protected by law of an average from between $15 to $18 per hour. As in relation to wages of supervisory to managerial positions, the average income can be from between $70K to $300K per annum or even highly. As a result of this, in general, everything is pretty much more expensive. However, this also allows for the affordability of a basic homes.

    The question now is that are Singaporeans in general a happy bunch and contented with what is being served in front of them? Are they happy to remain ignorant and not know how policies are made that will effect their lives? If this a is the case, Singaporeans are not ready for any changes in the political arena. But give a thought every now and then, that MPs are elected by the people to question anything and everything. This is the best form check and balances that can be put in place, and thus accountability and transparency.

    So vote wisely!

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