Housing, Income inequality, and GRC: Vote wisely

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Friends and fellow Singaporeans,

I am writing this letter as a concerned citizen, unaffiliated to any political party, to persuade you to vote wisely on May 7. I was and remain motivated by the increasingly large gap between the rhetoric we hear and the reality which all of us feel as ordinary citizens.

PM Lee has said that these elections are about our future, and that we should judge the PAP MPs on their track record. Plenty of ink has been spilled on various issues, but I want to touch on just three subjects: housing, socio-economic inequality and the electoral system.

Housing

We have been reminded time and again that HDB flats are affordable, a claim which we can examine most simply by comparing income to price . From 2000-2010, median monthly household income of residents rose from SGD3,638 to SGD5,000 (a 37% increase), while the resale price index for HDB flats rose from 108.3 to 164.0 (a 52% increase). Examining the data more carefully, we find that from 2005-2010, median incomes increased by 30%, but the resale price index leapt by 62%, i.e. HDB prices rose twice as quickly as median incomes in the last 5 years. Claims of affordability and progress don’t hold up when our parents took less time, with less income, to buy an HDB flat.

I would be less concerned if rising prices were not buttressed by the economically illiterate policy of “asset enhancement”. When the ministers speak of “asset enhancement”, they conveniently neglect the fact that leased assets (such as HDB flats) are by definition depreciating assets . Now repeat to yourselves the phrase “depreciating asset enhancement” – does that sound like a sustainable policy? Many have said that there is an implicit promise to renew the leases (e.g. via SERS , where the new flats come with new 99-year leases), but that comes with a cost: either the Singapore Land Authority forgoes income (in their words, raiding the reserves), or HDB pays to extend the lease (in my understanding, robbing taxpayers) . This is textbook fiscal irresponsibility.

Inequality

Socio-economic equality is important – the PAP has highlighted that with its last three election manifestos: “A people united – secure future, better life” (2001), “Staying together, moving ahead” (2006), and “Securing our future together” (2011). The statistics make for grimmer reading than taglines: the Gini coefficient , a measure of inequality, rose from .430 in 2000 to .452 in 2010 . The top 10% of households now earn close to 17 times what the bottom 10% do . More tellingly, the average real income of the bottom 10% of employed households dropped by 6.6% from 2000 to 2010, which indicates that we are leaving our weakest and poorest ever further behind.

This trend is unlikely to change, because our policy-makers are not incentivised to do so, no matter what the manifestos proclaim. Their base pay is determined formulaically by referencing it to a benchmark of the top earners across six professions . Their bonuses are pegged to absolute GDP growth and boosted by a discretionary component, presumably based on a subjective performance evaluation by the Prime Minister. Simply put, our Cabinet is paid more when the best-paid earn even more, when absolute (not per capita) GDP grows, and when they are judged favourably by their own peers. That does not strike me as a pay package which attracts those who truly wish to serve, nor motivates them (once elected) to listen to and speak up for the faintest voices in society.

Electoral system

In 2006, just over 1.1 million citizens cast valid votes for 47 contested seats . A PAP candidate was elected for every 16,625 PAP voters; the 375,143 votes cast for opposition candidates saw only two representatives returned to Parliament . While the British first-past-the-post (FPTP) system does lead to such outcomes , our unique, winner-takes-all GRC system has skewed it even further. This year, it is conceivable that as many as 85,000 voters will vote for the opposition in a single GRC, only to see 6 PAP MPs elected to Parliament .

The GRC system does not just mute a larger number of voices, but it also forces difficult choices on voters, who need to assess the entire slate of candidates. The contest in Aljunied GRC has thrown this into stark relief: is a single excellent candidate enough reason to vote in four others of hugely varying quality? What if one of the other candidates is rotten to the core? What if the excellent candidate passes away or steps down before the next General Elections ?

‘Cooling-off day’ is supposed to be a time to reflect, to help us make rational choices at the ballot box. The PAP’s track record and self-engineered compensation scheme leaves me with little doubt about the direction it will take our country towards should it even receive a shadow of a mandate. The electoral system tilts the results in their favour before a single vote has been cast.

I ask you, friends and fellow citizens, to vote wisely this Saturday: not for the PAP, but for Singapore and Singaporeans.

A friend and fellow Singaporean,
Ong Yi Xin