On housing and wealth creation

This author recently came across a 2009 Herald article which provided an excellent, incisive critique of the real estate bubble in the United Kingdom.

Singapore should learn from the housing situation in the United Kingdom:

“Between 1997 and 2001, house prices nearly doubled. They nearly doubled again by 2005. It was as if the government had given every homeowner an average of £100,000. No wonder they voted Labour. We were all corrupted by the housing boom, to some extent.

People talked endlessly about how their houses were earning more than they did, never asking where all this free money was coming from. Well the truth is that it was being stolen from the next generation.

Houses don't produce wealth, they merely transfer it from the young to the old - from the coming generation of families who have to burden themselves with colossal debts if they want to get a roof over their heads, to the baby boomers who are about to retire and live on the cash they make when they downsize.

MPs were the most egregious example of this, but in a sense we were all invested in the housing scam. Well, it's time to call a halt. Our property obsession has been an economic and political disaster.”

On foreigners owning property in Singapore

Local news reported today that resale prices for private homes have shot through the roof this year. According to one analysis, foreigners make up the majority (60 to 70%) of the buyers of private homes in Singapore, thereby propping the prices up.

Even foreign celebrities, such as Jackie Chan and Emil Chau, have gotten into the act, and purchased a number of condominium units last week, spending in excess of S$10 million.

But Singapore is land scarce, and many local citizens face great difficulty affording their own homes. The incredible rate at which housing prices have been permitted to go up compared to local salary rates is an extremely disappointing reflection of the PAP government’s understanding of the local populace’s housing difficulties.

This author is of the opinion that foreigners should only be allowed to purchase residential properties in Singapore if they actually live in them. Singapore is far too small a country to allow foreigners to speculate in and drive up the prices of residential properties beyond the affordability of the main local populace.

Actually, this author views that ideally, foreigners should not be permitted to purchase properties in Singapore at all. Given Singapore’s limited land area, there is no good reason why foreigners should be allowed to acquire property at the hardship and expense of Singapore citizens (who should be given a decent chance to aspire to owning a private home someday). The PAP government should not have permitted foreigners to purchase private homes, much less, the majority of private homes in Singapore.

On the City Harvest Church and S$310 million

When this author first heard about how City Harvest Church was going to invest S$310 million in a Suntec stake, this author’s initial thoughts were:

1. Does God need all this money?



2. I don’t think God needs any part of this money. Why doesn’t the church (being a registered charity) donate the money to charity?

It appears that in these modern times, many religious institutions have immense sums of money sitting in their coffers, and they even go to financial institutions to invest all this money.

But… God (and by God, I mean any god of any religion) doesn’t need money. It’s only human beings who have a need for money. Why don’t these religions institutions donate all the money to charity? That seems to be a benevolent and godly use of the funds. God would have approved.

On providing public transport for the disabled

The PAP government has steadfastly to this day refused to introduce laws to require that public transport companies provide free or reduced fares for the physically or intellectually disabled.

The public transport companies, SBS Transit Ltd and SMRT Corporation Ltd have also refused to provide free or reduced fares for the disabled on their own initiative.

Now, public transport for the disabled is a matter of recognising that many disabled persons face financial difficulties in day to day living, and that as a society, we have a moral responsibility to look after our less fortunate members.

It is not asking for too much. Please understand that this is only a minority segment of society who deserves our care and concern. There are no substantial profit reductions asked for or floodgates unleashed here.

This sad, heartless state of affairs cannot continue.

The government should make the laws.

The public transport companies should practise corporate social responsibility.

But given that these institutions have failed to do so.. this author would like to make an appeal to all shareholders of SBS Transit Ltd, SMRT Corporation Ltd and even ComfortDelgro Corporation Ltd (which is the holding company of SBS Transit Ltd) to bring up this issue at the next general meeting of each company. As shareholders, you own the company and you have the ability and the right to require that the company do something for the less abled. Alternatively, this author would like to ask those who can and are willing to do so, to purchase the smallest possible portion of shares in any of these companies and make the request at the next general meeting of the relevant company.

If enough caring shareholders vote for it, free/discounted public transport for the disabled can happen.

Please feel free to pass on this message.

On COE prices and quotas

Today’s news reported that COE prices had gone up by as much as S$14,411 in the latest bidding exercise, with the most expensive COE (the open category COE) costing S$42,001.

The huge increases were because the government was going to limit the supply of COEs from April 2010 onwards by pegging it to actual vehicle deregistrations.

The present cost of a COE makes car ownership prohibitively expensive and out of reach from the common population of Singapore.

Is there a way to alleviate this cost of car ownership? Well, how about having a COE quota for foreigners? Say, a 25% quota, which means that 25% of the COEs released each month will go to foreigners, while 75% of the COEs will go to Singapore citizens.

Having such separate categories of COEs for foreigners and citizens will likely reduce the COE prices for citizens (because there will be more available COEs for them), and in effect make foreigners subsidise some of the high costs of car ownership (as the foreigners will probably pay a higher rate of COE given a limited quota). More importantly, it would also benefit citizens (who have long term interests vested here compared to foreigners who are here for the short term) by giving them priority in owning cars and driving on the roads of their own country.

On Singapore citizenship and permanent residency

There’s been a lot of buzz of late on how Singapore citizens don’t have much of an advantage compared to Singapore permanent residents. In fact, citizens are at a distinct disadvantage in many instances, e.g. compulsory National Service obligations (which also frequently negatively affect employers’ preferences) and the prohibition of dual citizenships.

In an attempt (weak, in this author’s opinion) to placate some of these complaints, the PAP government tried to fix the problem by giving citizens slightly better benefits, such as better subsidies or priorities in health, education, housing etc.

But the unasked question so far is: is there a need for this creature, permanent residency?

What is permanent residency? Generally, permanent residency refers to a person’s visa status, and a permanent resident is allowed to reside indefinitely within a country despite not having citizenship.

Not all countries have a permanent residency scheme. Those that do, usually have a good reason, such as special ties with certain other countries. For example, an EU national who moves to another EU country can attain permanent resident status after residing there for five years. Also, permanent residence rights are granted automatically between Ireland and the United Kingdom.

But Singapore has no such special ties with other countries, even with Malaysia, its closest geographical neighbour.

Hence, in today’s terms, why not abolish the permanent residency regime in Singapore?

In other words, a person is either a citizen or a foreigner. After all, a permanent resident is still a foreign citizen at the end of the day. There are many permanent residents in Singapore who will never consider converting to citizenship despite living, studying and working here most of their lives, and frankly, it’s usually an emotional thing with them. They do not see Singapore as their home country, and there is no loyalty to Singapore at all. In fact, permanent residents ought not to be considered as Singaporeans.. that just unhelpfully blurs the line between a genuine Singaporean national and a person who is not.

Abolishing the permanent residency regime in Singapore is not only a good idea, it is also right for Singapore. The rationale is that Singapore is a small country with limited natural resources. All nationality benefits (and obligations, such as National Service and Central Provident Fund contributions) should only be reserved for and belong to citizens, who are the ones with the right to vote. Hence, for example, given that land is a scarce and valuable resource in Singapore, only citizens should be permitted to own HDB flats.

If a person doesn’t want to be a citizen, that’s fine. He or she can always choose to be a foreigner working and living in Singapore under an employment pass or work permit – there is no problem with that. The expression “permanent resident” is really a misnomer.. the person isn’t residing in Singapore permanently at all, only temporarily. If a person truly wants to make Singapore a permanent home, just be a citizen. There is no need for a hybrid creation like “permanent resident”.

There are many benefits which can be gained from abolishing the permanent residency regime, which will far outweigh the downsides, if any. Housing will be freed up, and the red hot inflated prices will have a chance to be at a normal realistic level. Jobs will be freed up as some permanent residents (who never intended to be citizens anyway) choose to leave. Lots of governmental savings can be made because all the subsidies and benefits that used to go to permanent residents will no longer be required. Overcrowding will be alleviated. All the headaches and problems which the PAP government had futilely been trying to address regarding citizen vs. permanent resident benefits will go away.

The permanent residency scheme can be phased out. All eligible permanent residents can be offered the chance to become a citizen of Singapore. As for the ineligible permanent residents, they simply revert to being plain foreigners, which is exactly who they were all along anyway.

What do you think?

On the Jack Neo sex scandal and sexual harassment in the workplace

Much has been said about Singapore filmmaker Jack Neo’s infidelity recently. But little has been raised in regard to how his behaviour likely constitutes sexual harassment in the workplace, and in particular, the lack of specific laws in Singapore that protect employees from sexual harassment and give employees an avenue for seeking redress.

What is sexual harassment? One definition is that sexual harassment is the “intimidation, bullying or coercion of a sexual nature, or the unwelcome or inappropriate promise of rewards in exchange for sexual favours”. It includes a range of behaviours from seemingly mild transgressions and annoyances to actual sexual abuse or sexual assault.

In the recent Jack Neo scandal, a number of women alleged that he made unwelcome sexual advances on them while they were in his employ or acting in his movies. Such behaviour certainly constitutes sexual harassment.

In this author’s view, every employee (whether female or male) should be protected by law from sexual harassment at the workplace. Furthermore, any employee who is sexually harassed at the workplace deserves an avenue of redress against the harasser. This is especially so if the harasser is in a position of authority over the victim. An employee who has been sexually harassed at the workplace should not be helpless without legal protection to defend herself or himself, and should not have to make the wretched choice of either losing the job or giving in to the unwelcome sexual demands of the harasser. If at all, the harasser is the one who should be penalised.

Now, sexual harassment is illegal in many countries, but unfortunately for Singapore employees, sexual harassment is not specifically illegal in Singapore.

In other countries, employers and harassers are legally responsible (under criminal and civil laws) for sexual harassment against their employees and liable to them for damages (i.e. monetary compensation for loss or injury). Examples of such countries include the United States, United Kingdom, the member states of the European Union, Australia, China, Philippines, India and Israel.

Why are there no specific laws enacted against sexual harassment in Singapore? It seems to this author that there are no good reasons why not, and it is time this lacuna is addressed by the Singapore government. In fact, sexual harassment is a prevalent problem in Singapore. In a 2008 study conducted by AWARE, 54% of the 500 participants surveyed reported having been sexually harassed at work. This includes both men and women.

Victimised employees need protection. And in this author’s personal opinion, it would not do to condone, or to rally around and support a harasser. Laws are vital to ensure that employers take pro-active steps to protect their employees from sexual harassment in the workplace, safeguard their careers and livelihoods, and give them a way to lodge their grievances. Having laws against sexual harassment will benefit not only local employees, but also the significant population of foreigners who come to Singapore to work (and who may otherwise be deterred from coming or harmed by the lack of sexual harassment laws). Certainly, such laws would go a long way in deterring a number of would-be offenders and protecting employees, and reprehensible cases such as the Jack Neo saga could be minimised or averted.

On advertisements and the truth

Kudos to kitchen tigress for teaching local bank, OCBC, a lesson on misleading advertisements!

Briefly: OCBC had been advertising that it surprises its customers with birthday cakes on their birthdays. On her birthday, kitchen tigress went to OCBC to claim her birthday cake, but was told by staff that it was just an advertisement and they don’t give birthday cakes to customers. This didn’t faze kitchen tigress one bit, and after sticking to her guns, an OCBC supervisor eventually relented and bought her a cake.

For too long, advertisers in Singapore have gotten away with feeding misleading advertisements and outright lies to consumers. This should stop. Here, OCBC advertised and gave the expectation that its customers would be surprised with birthday cakes – this didn’t happen for kitchen tigress. As for other misleading and possibly even false advertisements, these include weight loss services by slimming centres, hair growth products and services, and of course, financial products that are supposed to be “safe” (we all know the recent famous example which needs no introduction).

Companies should learn to tell the truth when advertising their products and services. If you can’t be truthful, then you shouldn’t be allowed to peddle your wares.

Do we have laws in Singapore regarding false and misleading advertisements? To some extent, we do. For example:

• There is the Misrepresentation Act, where if a person enters into a contract under a misrepresentation, then that person is entitled to cancel the contract, and possibly claim for losses suffered.



• There is the Consumer Protection (Fair Trading) Act, where it is prohibited for a supplier to (a) cause a consumer to be deceived or misled, (b) make a false claim, or (c) take advantage of a consumer.
  
  Examples of such behaviour include (i) representing that goods or services have performance characteristics or benefits that they do not have (weight loss or hair growth products and services may fall into these category), and (ii) offering gifts, prizes or other free items in connection with the supply of goods or services if the supplier knows that these items will not be provided (OCBC’s free birthday cake may fall into this category).



• There is also an interesting concept in law, where if someone advertises that he would do something in return for your action (say for example, give you a surprise birthday cake if you sign up as a bank customer), and you actually do it, then it is a binding contract in law and that someone has to fulfil his promise!
  
  A famous case which happened in England in 1892 was the “Carlill vs. Carbolic Smoke Ball Company” case, where a certain Carbolic Smoke Ball Company advertised that its “smoke ball” would cure flu, and if it did not, buyers would receive £100. Ms Carlill tried the smoke ball, which failed to cure her flu. When Carbolic denied giving her the £100, saying that it was only an advertisement gimmick and not to be taken seriously, Ms Carlill sued Carbolic and successfully got her £100.

Now, the abovementioned laws are not very effective, because they do not make it an offence for companies to advertise in a false or misleading manner. These laws only help consumers who are willing to go to court to seek redress. However, hardly anyone would bother going to court to seek redress – it’s troublesome and usually not worth the while because most people would not have spent very much anyway on the actual good or service.

So what can the government do to properly protect consumers in Singapore? Easy, pass a law that bans and makes it an offence to have false or misleading advertisements. This way, the onus is on companies and advertisers to be mindful of their responsibility to the public.

For completeness, it should be mentioned that a few items, such as medicines, have statutory regulations making it an offence for persons or companies to advertise them in a false or misleading manner in Singapore. But for most products and services in general, there are no such laws, and it’s about time something is done.

The objective here is not stifle creativity in advertising. For example, a tagline such as “Red Bull gives you wings”, while it is a cute tagline, the Red Bull beverage of course doesn’t give its drinkers any wings, and no reasonable person would expect it to do so, so there’s no harm (just a note here: in the opinion of this author, companies can come up with great taglines which are genuine, such as “HSBC – the world’s local bank”. Now that’s something which HSBC can try to deliver to its customers). But if a company advertises something that is humanly possible (such as a birthday cake surprise for its customers), then it should jolly well carry out its promise.