An Unequal Society, Not True First World
Singapore is an unequal society and not a true First World country. Other First World countries have things that we do not have. They spend more money on their people. Their governments give back what they take from the people. But the PAP government over-taxes and under-spends on the people. They take away one whole chicken from the people and give us only a chicken wing. As a result, the government accumulates huge surpluses that now exceed $1 trillion ($1,000 billion).
These huge reserves generate substantial investment returns. But the government allocates only a tiny proportion of up to 2% to the national budget even though they expect to achieve a higher long term annual real rate of return of 4%. We propose allocating the full expected rate of return of 4% to the budget as this would still leave the principal sum of the reserves untouched. This is what Norway does with its sovereign wealth of over US$1 trillion, giving the full expected return to the national budget each year.
First World Welfare
A full 4% contribution for the Singapore budget would mean over $42 billion available to be spent to help the people in 2019, instead of the allotted sum of $17 billion, and the extra $25 billion is more than enough to enable us to
- abolish the 7% GST,
- provide full subsidy for healthcare,
- provide full subsidy for education (no fees for school, ITE, poly, university),
- provide cash allowances to children and the elderly which will in turn boost the local economy and help small businesses (shops, eateries etc ), and
- lower fares of public transport.
How to Sustain into the Future
We can and must sustain this First World welfare well into the future by safeguarding and building up the people’s long term stakes in the country –
- continue with a new SERS to counter the declining value of old HDB flats,
- make HDB flats truly affordable to the young by not charging the cost of land, adding additional restrictions on the resale of these new flats,
- build more hospitals and schools, and double healthcare and educational personnel,
- fund career change plans of mid-career PMETs facing career disruptions,
- inspire and fund the young to realise their dreams of creating technology giants and
- support and fund initiatives of the young to tackle climate change.
This program is estimated to cost up to $10 billion. As it involves safeguarding the future, it should and can be funded by revenues from land lease sales. The past 10 years of land sales had generated an average of nearly $16 billion a year which is $6 billion more than required.
No New Taxes, Not “Raiding” the Reserves, Not Bankrupting the Country
No tax increase nor new tax is required to provide and sustain our proposed First World welfare programmes; instead taxes such as the GST and fees and charges for education and healthcare can be removed. Moreover, we will only be spending the investment returns on our reserves without touching the principal sum. Our country will not go bankrupt but will continue to have more than the principal sum of our reserves intact that will continue to generate returns to sustain our welfare spending.
Dual-Engine Economy: Growth & Welfare Together
We must now abandon the lopsided growth ideology of the PAP and fire the engine of the economy on both fronts at the same time, achieving economic growth and people’s welfare together like a true First World society. We deserve it and can achieve it.
It is time that we take back our money and build a true First World society.
“There is no such thing as public money. There is only taxpayers’ money.”
– Margaret Thatcher, October 1983
“Take Back Our Money, Be True First World”
– Tan Jee Say, February 2020