SDP exposes Government’s Budget

February 21, 2011
Singapore Democrats

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Singapore Democrats

At our annual dinner last night, the Singapore Democrats presented an analysis of the Government’s Budget and compared it to our Shadow Budget. Making the presentation, Dr Vincent Wijeysingha said: “Our proposals look to the future. They lay down foundations for your children.

“They are not a derisive attempt to remain in power. That comes from a morally bankrupt government. A government that has proved, with this Budget, that it no longer cares for people of Singapore but for its own political longevity.” Below is a comparison of the PAP’s Budget and the SDP’s Shadow Budget on key points:

 

Growth Dividend and GST

PAP’s Budget

SDP’s Shadow Budget

The Budget will give every voter between $600-$800. If we take the average of $700 per person, an average family of four (two adults and two children) will received $1,400. That works out to be $116 per month.

But based on a standard basket of goods, this family would spend about $2,570 a month at today’s prices. They would pay $180 of GST at 7%.

The PAP collects $180 in GST and gives back $116. Not a bad deal for the Government.

And remember: While the Growth dividend is a one-time handout, Singaporeans have to pay GST for the rest of their lives. This does not even include the probability that the GST will be raised after the next general elections.

Under the SDP plan, basic necessities are zero-rated for GST, and where non-basic items are charged 3%, and luxury items (worth $500 or more per item) at 10%.

In such a plan, the average household pays only $12 per month in GST compared to $180 presently. (This will be elaborated in a subsequent post).

This is why the SDP’s Shadow Budget does not contain ‘goodies’ like the Growth Dividend which is basically a sugar-coated pill to make the GST poison easier to swallow. Singaporeans must not fall for this.

Instead, our proposal to cut the GST makes much more sense and helps Singaporeans keep more of their money.

Foreign workers

PAP’s Budget

SDP’s Shadow Budget

The PAP proposes that the Foreign Worker Levy be raised by $100 in order to discourage the indiscriminate hiring of foreign workers.

The problem with this levy is that it will hurt smaller businesses but not the big corporations which will have no problem absorbing cost increase.

In the end it will not make any difference to the number of foreigners coming into Singapore. Past increases of the levy has not made any difference.

This latest proposal is nothing but a smokescreen to make it appear that the Government is doing something about the influx of foreign workers.

Our Shadow Budget proposes the Singaporeans First Policy where Singaporeans are given priority when it comes to employment.

Employers will have to demonstrate that no Singaporeans can be found for the job that they want to hire before a non-Singaporean can be employed. This will effectively stop the indiscriminate influx of foreign workers

The SDP also calls for the Foreign Worker Levy to be equally divided between the employer and employee.

In this manner, the foreign worker’s measly pay is increased and the employer saves costs; both parties benefit. 

HDB grants

PAP’s Budget

SDP’s Shadow Budget

The Government’s Budget gives first-time, low-income HDB flat buyers a grant if they buy Build-To-Order flats.

This may sound nice but the HDB does not reveal the true cost of building the flats. A generous estimate of the cost of building each flat (labour, material and land costs) is about $100,000 per flat.

Currently, the HDB charges $300,000-$400,000 for each flat it sells. That’s a whopping 200-300 percent profit that the Government pockets.

Senior civil servants have said that the HDB is a huge money-making machine for the Government. This is why the PAP continues to resist calls for the HDB to open up its accounts for public examination.

The Shadow Budget calls for HDB flats to be sold at cost. The HDB should be a zero-profit venture.

Because of the high HDB prices Singapoerans are using most of their CPF savings paying the monthly loans, leaving them little or no retirement savings.

The elderly are then told that they cannot retire because they have no income.

In the meantime, the HDB profit goes into the reserves which are used by the GIC and/or Temasek Holdings for dubious investments outside of Singapore. 

PMO and ministers’ salaries

PAP’s Budget

SDP’s Shadow Budget

PAP’s Budget continues to make the people pay for everything in Singapore. It then uses the money to pay for their leaders’ lucrative but ultimately redundant positions in the Prime Minister’s Office (PMO).

In 2010 $30 million was allocated for the salaries of all the political appointees in the PMO. In this year’s Budget, the amount was increased to $34 million.

The overall expenditure estimate for the PMO was increased to $347 million from last year’s $291 million.

The SDP’s Shadow Budget calls for the removal of the redundant ministerial posts in the PMO. This would save tax payers about $15 million per year.

The PMO should be trimmed off all the waste and fat. With all the government ministries working to support the PM why does he need such a bloated PMO with ministers serving no useful function?

The SDP proposes that the PMO’s budget be cut to $100,000 to support only the necessary programmes.

Defence

PAP’s Budget

SDP’s Shadow Budget

The Ministry of Defence will get a funding of $12.1 billion. This is an increase of 5.4% from $11.5 billion last year.

Of the $12.1 billion allocated, $10.5 billion or 85%, of Mindef’s expenditure is allocated to one category – military expenditure. No breakdown of this category is given.

There must be more transparency in Mindef’s expenditure as this will determine how its funds are used, what it is used for and whether it is used efficiently.

Our government leaders and diplomats constantly make insults and derogatory remarks of our neighbours, raising hostility and tensions as a result.

The Government then uses this as an excuse to build up our military to ‘protect’ Singapore.

What we need are leaders who will build good and robust relations with our neighbouring countries. In this manner, we don’t have to keep increase our military expenditure.

Radio and TV licence

The Government will abolish licence fees for radio and TV.

This is the biggest joke of the Budget. There was absolutely no reason for the PAP to be collecting these fees in the first place which amounted to billions of dollars through all these years. Malaysia abolished these fees 12 years ago.

The SDP calls of the Government to refund all the households the radio and TV licence fees it collected all these years.