According to reports in the mainstream media, Mr. Tharman was the star of yesterday’s (5 May) PAP rally in Bukit Batok. Let us pick apart what he said.
Mr. Tharman alluded that Dr Chee Soon Juan did not seem aware of the programs rolled out for the elderly such as the Pioneer Generation Package and Medisave top ups. He said spending on the elderly was the largest increase in the Budget.
The PGP looks large at over 2% of GDP when it was expensed in the 2015 budget but this is a prime example of government obfuscation. The PGP is disbursed over 20 years at a pace of $500m a year – barely more than 0.1% of GDP. This is the figure we should be debating and it is less spending a year than the amount allocated to the People’s Association. And is this such a ballyhoo when it is an increase from a very low base?
Mr. Tharman said the SDP is telling people only the good things about its proposals, such as how its proposal to provide universal healthcare would be costly, as evidenced by its example, France. The French spend 20 per cent of their income on tax for healthcare.
This is a repeat performance from last year. In both cases, Tharman spoke of high taxes and avoided mentioning the range of benefits. In the case of healthcare, he did not mention the free to low co-payment of healthcare expenses. No French will be obligated to sell their homes to finance their healthcare or for that matter retirement. Every time Tharman and the other Ministers mention high taxes, they did not mention the social entitlements received from paying those high taxes.
One of the biggest obfuscation is that Singapore taxes are “low” because social security payments, i.e. CPF contributions, are not treated as tax whereas in many 1st world countries, social security payments are bundled together with taxes. Let us not even get into the range of benefits and entitlements received.
Mr. Tharman conceded that Dr Chee’s idea of retrenchment insurance is not a crazy idea but said that he avoided mentioning the cost of setting it up.
I find this box standard response from Mr.Tharman and again from all his PAP colleagues when they spoke in and out of Parliament extremely tiresome. The entire cost-benefit proposition for more social spending like out of work benefits and social insurance rests entirely on controlling expenditures or foregoing the benefits. They never mention reallocating spending within the budget or an increase in taxes at the top quintile who had huge advantages such as barely taxed capital income on their invested assets.
Take for example, this year Net Investment Return Contribution, which is 50% of the inflation adjusted earnings from the reserves, contributed $14.6b to the budget. Yet despite the much advertised increase in healthcare spending especially for the elderly, Mr. Tharman himself said healthcare spending will reach $12b by 2020 – that is 4 years from now and still less than the amount of spending available to the government from the Constitution prescribed reserves spending rule.
Okay I get it. This is politics and this is political language giving “the appearance of solidity to pure wind.” And this sort of obfuscation and one-sided rhetoric are par for course in the liberal democracies. ….. which is the reason the independent think tanks and the ever watchful media are fundamental to the eco-system of democracy?
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This edited version is republished with permission from Chris Kuan’s FB.
