elections are coming

The elections have been called, and the question for all Singaporeans is which vision of the future would they prefer. With spiraling cost of living issues, housing is more important than ever.

The elections have been called, the battleground lines have been redrawn, and the future of the country now hangs in the balance. Much has already been said about the changes in electoral boundaries by the Electoral Boundaries Review Committee (EBRC), and more learned commentaries have already been published, that perhaps it would be best as Minister Chan Chun Sing has said to leave it to the public to decide if there was any gerrymandering. Perhaps most telling of this is that even if there were gerrymandering of the electoral boundaries, it would perhaps not be the most unfair thing about the Singapore elections. The Group Representative Constituency (GRC) system is arguably the even more damaging to our democracy, and even more insidious in the way it does it. But cry as we will about the unfairness of the system, there is still an election to be had, and it will be decided on the issues and concerns of the Singaporean people, not on any perceived, or even real, injustices of the system.

Battles over these issues have been fought in Parliament, and last month the budget was debated and passed. You would be forgiven for not watching any of it: the budget debate was largely a masturbatory display, and there is only so many times you can listen to a People’s Action Party (PAP) back bencher wax lyrical about the wonders of the National Trades Union Congress (NTUC) and government.¹ But it is still important to go through the debate, because ideas are important and it is the sincere hope that it will be on the strength of these ideas that Singaporeans will be swayed at the voting booth - one way or the other. By far the most interesting and important part of the debate came at the end of the budget debate after Prime Minister Lawrence Wong’s round up speech, and the subsequent clarifications that ensued. That speech and the answers that followed highlights the core philosophy of the PAP today, and betrays the lack of vision the PAP leaders have for the country.

We talking about surpluses?

“Sir, I would disagree with Mr Leong's characterisation of the PAP Government's policy as refraining or denying Singaporeans from funds, or keeping the funds and not leaving it in the pockets of Singaporeans, as he put it.” - Prime Minister Lawrence Wong

This was the crux of the debate between the PAP and the Opposition: are the Singaporean people better served if the money is with the government and spent on the behalf of the people, or are they better served if the money is in their own pockets and they can spend it however best they see fit?

The Opposition has done a terrible job in Parliament defending their position of excess surpluses. Part of the reason is this obsession with “non-adversarial” politics, the roots of which could probably be traced back to the Worker’s Party’s (WP) ascent to power, where as part of their strategy to garner votes the WP has advocated for a more constructive style of politics. And who could blame them? This was a winning tactic, and has only won them more seats in Parliament. Singaporeans, having witnessed the fistfights in the Taiwanese legislature and a turbulent Trump term, prided ourselves on our “boring” brand of politics, the less adversarial the better. Now, every Opposition party is emulating this approach in hopes of gaining traction in their own campaigns.²

Far be it for this writer to be seen as being overly critical of our Opposition, but precisely because the job is so difficult and the odds so stacked against them that it is imperative that they perform. This is not a call for oppositional or adversarial politics, where opposing parties oppose for the sake of opposing. But it is possible to disagree with the policies even if you agree with the policy objectives, and it is possible that the PAP’s ideas are not always what is best for the country. Sometimes, a line needs to be drawn in the sand, and a stronger push for ideas and policies in Parliament does not mean the Opposition is being adversarial.

The PAP on the other hand is not bound by such constraints. There is of course no incentive for the PAP to come to any compromise with the Opposition given their overwhelming super-majority. But even beyond that, there is a proclivity for the PAP to treat Opposition policy positions and arguments with a certain disdain: arguments are rarely treated with charity (in many cases outright strawmanned),³ and in the most egregious cases members can be outright mocked. This has allowed the PAP to frame the conversation in their favour.

“I find it strange that we have spent all this time trying to defend a surplus, while most developed economies in the world are begging for a surplus. [Applause.]” - Mr Neil Parekh, Nominated Member of Parliament (NMP)

All this culminates in NMP Neil Parekh dropping the line above, a line which has since been repeated throughout the Committee of Supply debates by various ministers, including PM Wong and Minister Vivian Balakrishnan. It is of course easier to pretend that the Opposition is concerned about having a surplus than to debate the Opposition about whether the people, rather than the government, are better placed to decide how best to spend their money.

Whose money is it anyway

And this is the whole point in asking if the government has over-burdened Singaporeans in creating a surplus for the budget: while surpluses are a good thing for a country, there is a cost to them - the money has to come from somewhere. This is the core PAP philosophy: that the government should collect and spend on behalf of the people, because it knows what is best for the people. It is a philosophy that started with Lee Kuan Yew and persists to today: “We decide what is right. Never mind what the people think.”

While that might have been the best course forward in a country strapped for resources and a fledging government struggling to survive against the odds, today the situation could not be more different. Singapore today is one of the wealthiest countries per capita in the world. The people are one of the most educated. The government has also changed: we no longer have visionaries like Lee Kuan Yew leading us. What is so wrong with letting the people decide what is best for themselves?

It is disingenuous that PM Wong pretends that Mr Leong is concerned that the government is hoarding the funds and not spending it. Everyone understands that the purpose of government is the collection and spending of tax revenue on behalf of a country, the issue is what the spending is on. Nobody is complaining about new trains, or new hospitals, or paying our soldiers. But to pretend that every Singaporean agrees with and appreciates spending on the Community Development Council (CDC) mayors, or that Singaporeans are enthusiastic about NS Square or Founders’ Memorial, or the S$900 million spent on SPH Media Trust, just to name a few.⁴ The objection is not to government spending, it is to government spending Singaporeans don’t want.

The needs of every Singaporean is different, and each person is best suited to decide for themselves how best to spend their money. Afterall, what good are SkillsFuture credits when you’re trying to pay for your child’s tuition fees or trying to keep an ailing business afloat? The government cannot and should not be a panacea for every problem. But the systemic push to make it so by introducing government to every facet of life, and by making the poorest among us increasingly dependent on government handouts creates a vicious cycle of dependency.

This then is the argument against the surplus: there can and should be a different vision for Singapore, one where Singaporeans have more money in their pockets to spend on themselves, instead of the government spending on their behalf. Nowhere is this more apparent than in the housing crisis we face today.

Our housing crisis

Strictly speaking, Singapore is not in a housing crisis at the moment. The prices are high, but by the design of the PAP they are still affordable. But like an albatross around the neck, the specter of housing will continue to haunt Singaporeans so long as the fundamental contradiction of our public housing system exists: the government wants housing to be both an asset and store of value for Singaporeans in old age, while simultaneously being affordable to younger generations of Singaporeans. It cannot realistically be both: for it to remain a store of value it has to indefinitely appreciate, and for it to remain affordable to younger generations it cannot indefinitely appreciate. Something has eventually got to give.

Cost of living will be the key issue in this year’s election, and at the center of that will be the cost of housing. For many people housing will be the single most expensive purchase of their lives, and the single most expensive thing they will own in their lifetimes. Reducing the cost of this one purchase can single handedly free up capital for the pursuit of other more important endeavours: the extra cash flow can encourage many more Singaporeans to try their hand at business and innovation, or it can be used as the seed funding for their children’s future. The money can be invested in an actually productive industry rather than used to fuel the speculation of land prices, and it could be just the thing that is needed to jumpstart our ailing stock exchange. In a land scarce country like Singapore land should never be a commodity for speculation. This will also remove the incentive to continuously participate in property leapfrogging to maximise the value of your property, another huge benefit as only the truly sick and perverse enjoy moving houses.

The PAP is content keeping the status quo insofar as it extracts as much as the Singaporean population can bear, this is the PAP’s definition of affordable housing: the most Singaporeans can pay without the entire system failing. Nothing betrays the lack of vision this new generation of leadership has than maintaining the fundamental contradiction: out of one corner of their mouths the PAP will preach to the homeowners that their store of value in their assets is secure, but out of the other corner they will whisper to aspiring homeowners that housing is affordable. The introduction of Plus and Prime flats combined with ever increasing amounts of subsidies serve to kick the proverbial can down the road, but there is only so many times you can kick the can before it completely breaks down. Just over the horizon looms the inevitable expiration of HDB leaseholds, a ticking time bomb just waiting to destroy the bedrock of Singaporean society. There is no vision, no solution for the housing crisis - Voluntary Early Redevelopment Scheme (VERS) was announced two years ago and we have yet to hear any details.

There are solutions to public housing, but it would require political will and a stomach for short term pain. It will require a government that does not change their minds at the slightest hint of displeasure from the electorate,⁵ simply put it would take a government that is willing to do what is right and not what is simply convenient. It is of course doubtful that Singaporeans have the stomach for such pain, and perhaps PM Wong and the PAP are right in their estimations to continue with the status quo. But we are fast approaching the need for housing reform:

1. Remove land costs from housing prices. This is a popular Opposition suggestion - both PSP and SDP have suggested some variation of this in their manifestos. Removing the land cost and only charging the cost of construction would lower the cost of housing. The difference between buying a S$200,000 or cheaper house versus a S$400,000 or more house cannot be understated: it’s not just the cost of the house, one has to remember that often times amount paid for a loan after all the interest is extracted comes up to near double the loan quantum itself.

2. Increase the size of HDBs to sizes comparable to HDBs built in the 1970s and 1980s. This will remove the need for couples who wish to have families to upgrade their houses when they want to expand their families, and will also encourage more Singaporeans to have families in the first place.

3. Return public housing to its initial purpose of home ownership and as a place for Singaporeans to stay. This means removing the ability to rent out all or part of a HDB flat and the ability to own a private property while still owning a HDB flat. This also means reinstating a cap on the amount you can sell the HDB for, removing the free market system for resale flats.

4. Make all current HDB flats private property, while still providing estate maintenance from the government at the rates of the current conservancy charges. This will remove all restrictions on current HDB flats, allowing owners to sell freely on the open market, and to deal with their property as they would a private property, opening up opportunities for en bloc sales. This will retain the value of previous HDB flats.

By far the most common argument against all of this is that removing the land costs will essentially be robbing the reserves, to which there are several rebuttals:

1. HDB currently operates at a deficit. The current method of pricing HDB flats is to first have HDB buy the lands from the reserves at market value, then have the government subsidise the total cost (including construction) to arrive at the Build to Order (BTO) cost. As a matter of good accounting hygiene, it makes sense to pay in the land costs into the reserves first. But as a practical matter, when you consider that the government is subsidising HDB and allowing it to run at a deficit by using money from the operating revenue, money which could have gone into the reserves should there be a surplus, the argument of robbing the reserves loses some of its luster.

2. While Singapore has yet to reach this point, consider this: once every parcel of land allotted for purpose has been sold to HDB and developed once for public housing, upon expiry of that parcel of land when the reserves once again sells this parcel of land to HDB, the reserves has essentially double dipped on that piece of leasehold land. This was a point of contention in the 7th February sitting of Parliament in 2024, and the reader is best positioned to decide who made the more convincing argument.⁶

3. While details of VERS have yet to be released, if indeed this is how it works, it completely undermines the concept of robbing the reserves. While the PAP has made it clear that VERS would not be for every expiring 99 year lease, the mere fact that the government would be paying out some leases and essentially buying back the expiring leases, which should have expended most of its value over its lifetime, is essentially returning the cost of the land back to the owners of the leasehold.

4. The safeguarding of the reserves are for future generations of Singaporeans. However with the current housing policy our TFR has fallen so low that there may not be much of a Singapore in the future, at least not one which our current generation would recognise or uphold. Further, to maintain the value of public housing such that it stays an asset that does not depreciate relies on borrowing from the future generations to pay off this current generation. Our generation and our descendants will not experience the same windfall increase in housing prices that our forebears experienced. Essentially the government is borrowing from Jayden Tan to pay off Tan Ah Kow. If the reserves are for the future, then fixing this housing crisis is more important than hoarding some rainy day fund most Singaporeans will never enjoy.

In the land of the blind

When the Opposition asks for lower Goods and Services Taxes (GST), or when there is a call for housing to be cheaper, this becomes the cue for the naysayers to crawl out of the woodworks with their cries of populism. The irony is that for all the accusations of a populist Opposition, the PAP have fully embraced the populist ideology. The yearly handouts which had modest beginnings in 2020 are now front and center of the PAP’s agenda, embraced by the new leadership with renewed vigour. Then there are the U-turns,⁷ where the PAP bent to the public outcries, betraying that either they did not have the right idea in the first place, or that they lacked the political will to push forward with what they thought was right. Any of this would be enough to have Lee Kuan Yew turning in (or rising from) his grave, the very man who made populism such a taboo word in this country.

The elections are upon us, and Singapore finds itself at a crossroads. It’s about the philosophy of government, and the vision for the future. The wait and see approach of this new generation of PAP leaders interested in prolonging the status quo so long as it means the continued rule of a PAP government, Singaporeans are now very familiar with the now common PAP catch phrase: “monitoring the situation”.

Singaporeans are stuck between a rock and a hard place. We are faced with a choice between an Opposition that may not be ready yet to take the helm of government, and a group of paper pushing bureaucrats. The PAP leadership knows that discontent is brewing. Already, they are pivoting to the tried and true: never let a good crisis go to waste. They have found a new bogeyman in the US tariffs, and are hoping to ride the wave of fear into their next political term.⁸

Lawrence Wong may yet be king, but for all his talk about Forward Singapore he lacks a comprehensive vision for our future. Now, more than ever, Singapore needs a leader who can chart a new course forward through uncertain times. Majulah Singapura.

1. If you are confused about the Committee of Supply proceedings, this explainer from Mothership does a good job about what is happening. Notably, none of the members (even those from the Opposition) actually proposed any cuts; ironically, they’re all asking the government for even more things, which could potentially increase the budget. It is a personal preference that I would like to see MPs actually asking for cuts and questioning government spending, but alas while government cuts as an idea is popular, the moment you go into the specificities of the cuts nobody actually knows what should be cut, and it becomes an unpopular suggestion. Perhaps none of the MPs are willing to expend any political capital in even attempting to suggest cuts to the budget.

2. As I’ve observed before, I have yet to see a situation in which something which benefits the WP benefits the Opposition as a whole, or a situation which negatively impacts WP by itself. It remains to be seen if adopting this approach of “non-adversarial” politics will benefit the other members of the Opposition as much as it benefits the WP.

3. By far the worst offenders of strawmanning arguments are probably Prime Minister Lawrence Wong and Minister Chee Hong Tat. Both employ a dishonest tactic in their debating - they give very little charity to the idea presented by their opponents, and will pretend that just because one disagrees with a policy prescription one necessarily disagrees with the underlying objective. What I mean is this:

Example one: When debating Leader of the Opposition Pritam Singh on the Climate Vouchers, PM Wong makes this statement: “I mean, the WP is free to object to it if they feel like it is not worth doing. And if they feel that they do not want to support this, please say so. But we think it is a worthwhile move to make to encourage energy efficiency.” It is clear that Mr Singh had made no such suggestion that the Climate Vouchers were not worth pursuing, rather Mr Singh was making a broader point about the necessity of these vouchers being indicative that Singaporeans at all levels were suffering from inflation. It is an incredibly cheap shot to make the insinuation that Mr Singh was against energy efficiency. This is a popular debating technique amongst the PAP: “oh? You don’t like the Climate Vouchers? Does this mean you’re a Climate Change Denier?” It is incredibly disingenuous.

Example two: Later in the same session when debating Mr Leong Mun Wai, in response to Mr Leong’s concern that HDB resale prices might go into freefall once all demand was satiated, PM Wong replied: “Are we worried that we are over building? Here, I am a little puzzled. I thought Mr Leong and PSP are worried about not enough flats… So, are we concerned about high prices? Are we concerned about the opposite?” It is a classic routine at playing dumb, an attempt at trivializing a real concern Singaporeans will have. Just because one wants to have lower HDB prices does not mean that one cannot also be concerned about crashing the housing market.

If you listen to the arguments in Parliament you would find that many PAP members debate in this fashion.

4. This does not even account for the tremendous amount of government waste. Just to list a few lapses by the Auditor-Generals’ Office (AGO):

• wastage of S$5.39 million by the Health Promotion Board over excess fitness trackers;

• overpayments by NParks amounting to S$1.93 million;

• overpayments by the Ministry of Education amounting to over S$300,000.

And these are just lapses that have been found by the AGO, there could very well be many more that the AGO have never found. More importantly, these are also just what the AGO considers to be lapses. In reality, there could be a lot more waste that the AGO does not classify as lapses.

Take for example the distribution of welfare in Singapore. There are CDC vouchers, NS life vouchers, GST vouchers, and each of these are distributed in completely different ways. Not only is there waste in having different systems for distributing different types of welfare (and this waste comes in the form of administrative burden, the cost of creating the systems, and the cost of maintaining it), by far the worst offender of this are the CDC vouchers.

The CDC vouchers are so ill-conceived that they are not even fit for purpose. The CDC vouchers are meant to support Singaporean households, but in the most perverse manner, the ones who need it most would get the least of it. As every household only gets one set of vouchers, a family of five would receive less than someone staying alone, despite the family presumably needing more support. There is also the printing of physical vouchers for the elderly and technologically impaired, and the deploying government staff from the CDC and PA to assist in the distribution of these vouchers. If only there was a way to distribute this money directly into the accounts of Singaporeans without the need for this archaic voucher system, like maybe directly into their bank accounts. Something like the GST vouchers, perhaps?

These are just some examples of government waste.

5. In the past election cycle, this PAP government has folded to populist demands multiple times:

• In the SimplyGo debacle, having introduced an unpopular new system that removed functionality from the old system, the government walked back the decision to end EZ-Link after disquiet and complaints from the electorate;

• In the sale of NTUC Income to Allianz, the government did a complete U-turn after the electorate made it clear they were displeased with the deal, and despite singing praises for the deal in August it would be only 3 months later that the same government would pretend they never actually supported the deal.

6. The question posed by the Leader of the Opposition Pritam Singh was as follows: “But again, it will be helpful if the Prime Minister can share with this House if a single piece of land is sold repeatedly for as long as the lease lasts – how does that cohere with the Prime Minister's position that land is just a conversion? I think the Prime Minister will be right if we are talking about freehold land, but this is leasehold.”

The response he got from then PM Lee Hsien Loong was: “Land, yes, you can sell it over and over again. You cannot sell a freehold over and over again. You can sell leasehold over and over again. So, if you sell a 30-year leasehold, I can sell the first 30 years now. I can sell another 30 years. If I sell it now, I will get very little money. I can sell it at the end of the first 30 years. I can sell another 30 years. At the end of that 30 years I can sell, yes another 30 years and so on forever. So, does that mean the leasehold is worth 30, $1 plus $1 plus $1 plus $1 plus $1 forever? No. There is such a thing called an interest rate, a discount rate.

And if you add all those payments together and discount them, you get the price of the land for freehold, at least in principle.

So, if you sell the freehold land, it is one price, if you sell the 30-year lease, it is another price, it is shorter, but you are only selling that 30 years and you get in 30 years' time, you have the chance of selling it again and again. And if you add up all those 30-year lease earnings, well, that should get you the freehold value.”

Essentially if you follow the logic presented by SM Lee he is saying that every time you sell the same piece of leasehold land you are accumulating and approximating towards the actual value of the land (or the freehold price). However over an infinite period of time and over infinite sales the price of that land would be infinite. Practically we know that freehold land’s value is not infinite, and therefore at some point having sold the same piece of leasehold land you would have exceeded the freehold value.

7. See footnote 5

8. A strong mandate for Lawrence Wong would encourage more of the same policies, where we continue on this path without addressing any of the underlying issues that have led us here. Housing, TFR and national identity will be at the biggest risk in the next term. This is also however the most likely outcome. Even if the Opposition take 1 or 2 more GRCs it will still be a strong majority for the PAP.

The ideal outcome for this election may be an Opposition rout, but with a PAP government. This might force a complete overhaul of the PAP leadership, hopefully to one which is willing to chart a new course. With Opposition threatening to take a majority it might finally force the PAP to reach across the aisle. In recalibrating Singapore’s trajectory and future, Singaporeans may be in for some short term pain. It is unclear if Singaporeans have the stomach for this.