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Inequalities in Singapore: income, wealth, class, opportunities...

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China's mega-rich move their wealth, and partying, to Singapore​

Singapore is increasingly viewed as a home rather than just a backup plan for ultra high-net-worth Chinese clients, as this is where their "family wealth is kept safe", say industry insiders.
China's mega-rich move their wealth, and partying, to Singapore

File photo of skyline buildings of the Central Business District in Singapore on Nov 16, 2022. (Photo: CNA/Hanidah Amin)

4 Feb 2023

Singapore is seeing an influx of ultra-wealthy families from China looking to protect their wealth from the Chinese Communist Party, who increasingly views them with suspicion.
Beijing's recent crackdowns on tech billionaires and tax-shy celebrities, as well as three years of zero-COVID policy, which only ended last month, have led many rich Chinese to look for a safe haven.
Nervous over the fate of their fortunes, some of the country's mega-rich have since booked tickets to Singapore, insiders told AFP.
The key Asian financial hub ticks all the boxes for relocating tycoons.
Singapore has been ruled by one party - the People's Action Party - for the past six decades, and labour strikes and street protests are banned. Taxes are comparatively low and the population is predominantly ethnic Chinese.
The presence of recent Chinese arrivals is keenly felt in Singapore, with some relocating to luxury homes with waterfront views on Sentosa Island, which also houses a theme park, a casino and a prestigious golf club.
"You cannot imagine the way they spend money. It's crazy," said Pearce Cheng, CEO of AIMS, a firm providing immigration and relocation services.
He recalled attending a Chinese client's party where a rare Japanese "Yamazaki 55" whisky, worth around US$800,000 a bottle, was served.
Cheng's firm also helps rich Chinese find luxury condos, hire chauffeurs and enrol kids in private schools. It once even bought US$61,000 worth of cigars.
The new arrivals drive Rolls Royces and Bentleys, and are often spotted at top-tier golf clubs such as the exclusive Sentosa Golf Club, where foreign members pay US$670,000 a year.
"Many of them are younger Chinese, in fashionable designer clothes, and they usually keep to themselves and dine amongst themselves, which is not surprising," said Benny Teo, managing director of Blazon, a consultancy specialising in golf.

"WHEN I'M HERE, I KNOW MY MONEY IS MINE"​

Relocating to Singapore puts the wealth of China's richest beyond the reach of Beijing, whose recent high-profile crackdowns have rattled billionaires.
Alibaba Group co-founder Jack Ma, among the most recognisable Asian tycoons, lost an estimated US$25 billion when Chinese regulators pulled the plug on a blockbuster initial public offering (IPO) in 2020.
Other Chinese tycoons fear the Communist Party could apply similar pressure or even take over their businesses at low prices, an accountant familiar with the situation told AFP.
"Moving to Singapore is about making sure the family wealth is kept safe and can last for several generations," the accountant said.
Singapore is increasingly viewed as a home rather than just a backup plan, another source in the industry said, adding that clients had told him: "At least when I'm here, I know my money is mine."
One of the founders of China's largest hotpot chain, Haidilao, also recently set up a family office in Singapore.
The Monetary Authority of Singapore estimates that the number of family offices - wealth management companies dedicated to individual and group assets - rose from 400 in 2020 to 700 in 2021.
Loh Kia Meng, co-head of private wealth and family office practices at law firm Dentons Rodyk, estimated that 1,500 family offices would have been set up by the end of last year.
"I won't be surprised if the total figure by the end of 2022 shows that one out of two new family offices originates from China," he said.

"HANDY NEUTRAL ZONE"​

The outflow is expected to continue even though China's strict zero-COVID policy and curbs have now been lifted, analysts said.
Political tensions between Beijing and Washington are reinforcing the desire of some of China's richest to move abroad.
Singapore is a "very handy neutral zone" where the mega-rich can do business, said Song Seng Wun, a regional economist with CIMB Private Banking.
The country has deftly managed its relations with Washington and Beijing, maintaining close security ties with the United States while preserving robust trade links with China.
"Media attention on prominent wealthy individuals setting up family offices in Singapore cast the spotlight on our little island and (has) stirred interest," said Loh.
"If the world's rich are congregating in Singapore, why not me?"
 

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Two lawyers called to the Bar after owning up to wrongdoings had learnt from mistakes: CJ Menon​

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Chief Justice Sundaresh Menon allowed their applications to be called to the Bar after all stakeholders involved said they had no objections to their admission. PHOTO ILLUSTRATION: ST FILE
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Selina Lum
Senior Law Correspondent

MAR 9, 2023

SINGAPORE - Two law graduates from Singapore Management University (SMU), whose admissions to the Bar were deferred after they voluntarily owned up to their past wrongdoings, were called as lawyers on Thursday.
Ms Tay Jie Qi disclosed that she had plagiarised several paragraphs for a paper during her second year at SMU, even though this was not reflected in her academic transcript.
Ms Shauna Low came clean about two separate brushes with law enforcement: She was caught shoplifting, and was also arrested and tested for drugs after Xanax pills were found in her sister’s bag.
Ms Tay’s application to be called to the Bar was originally set to be heard in August 2022, and Ms Low’s in November 2022.
They agreed to adjourn their applications for three months after the Attorney-General’s Chambers (AGC) objected to their admissions.
On Thursday, Chief Justice Sundaresh Menon allowed their applications to be called to the Bar after all stakeholders involved said they had no objections to their admission.
He said: “Everyone makes mistakes. The real question is whether one demonstrates the capacity to learn from one’s mistake.”

He said the two demonstrated remorse and capacity for change, and were transparent in disclosing matters that were not in the public domain.
CJ Menon added that their willingness to face up to their mistakes was “heartening” and concluded that no further deferment was needed.
The two applications are unrelated to the series of cases where 11 aspiring lawyers cheated in Part B of the Bar examinations in 2020.

Ms Tay plagiarised several paragraphs from a paper by another student in the previous year when she submitted her research paper for a module on constitutional and administrative law.
When confronted, she apologised and was given an official letter of reprimand. She also had five marks deducted from the paper.

The incident was recorded internally and not reflected on her academic transcript.
She disclosed the plagiarism incident on her own initiative in her Bar admission application.
The AGC and the Law Society, two of the stakeholders involved in the admission of lawyers, sought additional information from her, and she filed an affidavit detailing the incident.
CJ Menon said her case was dissimilar from those who cheated in the 2020 Bar exam – the plagiarism was isolated and took place a significant amount of time before she applied for admission.
He said Ms Tay was resolute about coming clean and facing up to the consequences, and had sufficiently shown that she has learnt from her mistake.
As for Ms Low, she disclosed that she was caught in 2016 when she tried to steal an eyeshadow palette from a store. The police eventually gave her a stern warning and her police record was sealed.
Some time between 2017 and 2018, she went for a night out at a club, where a staff member found illicit substances in the bag of one of those in her group.
Ms Low tested negative for drugs. She later found out that Xanax pills, which had been prescribed to another person, were found in her sister’s bag.

CJ Menon said the second incident was not pertinent as it did not show a character defect but was an unfortunate incident.
The shoplifting incident reflects dishonesty, but he said Ms Low has shown that she has reflected on, and remedied, what took place six years ago, and has maintained a clean record since.
He added that she was willing to openly confront her mistake, and showed candour and accountability.
 

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Forum: Average Singaporean should have a decent chance of owning a car​

Apr 25, 2023

In the light of record-high certificate of entitlement prices (Soaring COE prices: What’s driving the insanity and when will it end?, April 24), I wonder if we are allocating a scarce resource efficiently. Even small cars are now beyond the reach of the average Singaporean.
Moreover, the high COE costs would have a trickle-down effect and be passed on in other ways such as taxi fares, the cost of rental cars and other forms of transportation, and business costs. This would contribute to the financial woes of Singaporeans.
I know of one resident in my estate who owns nine cars. The rich will continue buying more cars and leave them idle at home.
Is that the best use of a scarce resource? These resources could be put to better use by those who really need them, such as those who have to ferry children or the disabled.
There have been calls for measures to curb ownership of cars beyond the first car by making those with multiple cars pay more. These are worth considering, to come up with a system that can address the problem of average Singaporeans getting priced out of the market and the inflationary pressures from runaway COE prices.
The average Singaporean should have a decent chance of owning a car. I urge the Government to do something fast about the current COE system.

Charlie Tan
 

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Forum: Give all students a chance at DSA by beefing up school resources​

May 26, 2023

As I look at many of the Direct School Admission (DSA) requirements for secondary school, I get the impression that Singapore’s education system is becoming more elitist rather than meritocratic.
To get a spot in the secondary school of your choice based on, for example, sports, you would need to have certain achievements and awards and have taken part in competitions.
Many neighbourhood primary schools have a limited number of co-curricular activities (CCAs) and the students may not have the chance to be exposed to the sport they are keen on. Those who want to spend more time at a sport to be much better at it may require extra lessons at their own expense, something their parents might not be able to afford.
For instance, gymnastics is not offered as a CCA in most schools. If the child is keen on this, the parents need to have both time and money for the child to take classes outside school. To do gymnastics at a competitive level, a commitment of at least six hours a week is required on weekdays.
This is also true for other sports, such as soccer, as not all schools offer this.
In addition, not all neighbourhood schools offer exposure in varied activities for their students such as coding, robotics or entering competitions such as the Maths Olympiad.
With the difference in exposure starting from young, meritocracy is no longer based on one’s abilities and talents, but whether your parents have resources.

We should make it such that “every school is a good school” by allocating more resources in terms of bigger budgets, more teachers and programmes to all schools, and ensure the same opportunities for students in all schools.

Huang Jia Hui
 

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Forum: Give all students a chance at DSA by beefing up school resources​

May 26, 2023

As I look at many of the Direct School Admission (DSA) requirements for secondary school, I get the impression that Singapore’s education system is becoming more elitist rather than meritocratic.
To get a spot in the secondary school of your choice based on, for example, sports, you would need to have certain achievements and awards and have taken part in competitions.
Many neighbourhood primary schools have a limited number of co-curricular activities (CCAs) and the students may not have the chance to be exposed to the sport they are keen on. Those who want to spend more time at a sport to be much better at it may require extra lessons at their own expense, something their parents might not be able to afford.
For instance, gymnastics is not offered as a CCA in most schools. If the child is keen on this, the parents need to have both time and money for the child to take classes outside school. To do gymnastics at a competitive level, a commitment of at least six hours a week is required on weekdays.
This is also true for other sports, such as soccer, as not all schools offer this.
In addition, not all neighbourhood schools offer exposure in varied activities for their students such as coding, robotics or entering competitions such as the Maths Olympiad.
With the difference in exposure starting from young, meritocracy is no longer based on one’s abilities and talents, but whether your parents have resources.

We should make it such that “every school is a good school” by allocating more resources in terms of bigger budgets, more teachers and programmes to all schools, and ensure the same opportunities for students in all schools.

Huang Jia Hui

There is nothing wrong with being elitist as it ensures that the country is governed by people with a good pedigree.
 

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Primary 1 registration: Where alumni privilege and distance rules can accelerate inequality​

ACS Primary’s move bucks this trend and provides an opportune moment to relook P1 registration criteria​

Cameron Kheng, Vincent Chua and Eik Swee
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The Primary 1 registration exercise is currently driven by mechanisms that potentially reinforce pre-existing inequalities in society. PHOTO: ST FILE
UPDATED

APR 26, 2023

In the fairest possible world where allocations are based purely on chance, students would be assigned to their primary schools through a random process of balloting.
Whether “elite” or “neighbourhood”, all primary schools would comprise first-year students from across the social spectrum, rich or poor, near or far, and regardless of race.
In such a scenario, the correlation between social class background and the status of a school would trend towards zero.
However, this is far from the current reality. The distribution of students across Singapore’s primary schools is characterised by the rules of a game that run counter to the desire for a level playing field.
While this may have never been its intention, the Primary 1 registration exercise is currently driven by mechanisms that potentially reinforce pre-existing inequalities in society.
The Primary 1 registration exercise is marked by several phases. Phase 1 is reserved for students whose siblings are currently studying in the school.
Phase 2A prioritises children whose parents and siblings are former students of the school, as well as parents who are members of its alumni association, staff of the primary school or members of its advisory and management committees.

Phase 2A also grants entry to children who had attended the Ministry of Education (MOE) Kindergarten tied to the desired school.
Phase 2B reserves placement for parents who volunteer with the school, are active community leaders, or members of school-affiliated organisations.
Finally, Phases 2C and 3 are open to all other applicants.


When a school is oversubscribed during a phase, especially during Phases 2B and 2C, distance rules will apply. This means that students who live within a 1km radius of the school are given priority ahead of those who reside farther away.

Competing interests​

Debates over the Primary 1 registration exercise are tricky to navigate, often rife with competing interests from across the social spectrum.
For example, while many alumni claim that the current system helps them build on and preserve school ties, culture and heritage, others feel that these schools have essentially become exclusive clubs for the elite.
Discussions like these mainly coalesce around three critical features of the admissions process.
First, Phase 2A grants preferential choice to alumni parents, meaning that their children can gain entry into their former primary schools on the basis of their parentage without even needing to sit for anything resembling a test.
This essentially allows the past to be superimposed onto the present by sending parental privileges forward in time, intergenerationally, to children who did nothing in particular to merit them.
These children can then enjoy the material and reputational benefits of attending an elite school.
Whether this translates into actual gains at the Primary School Leaving Examination is another question, but perceptions of prestige can lead to self-fulfilling outcomes.

Second, schools grant preferential entry to parents who had volunteered at least 40 hours of service in their desired primary schools during Phase 2B of the exercise.
Were it the case that all parents had an equal capacity – in time, resources, or expertise – to render such services, this phase would hardly be contentious.
However, such capacities are heavily dependent on one’s socio-economic standing, especially when comparing the greater time flexibility that white-collar professionals have over lower-wage workers.
Third, when school places are oversubscribed, they are balloted on the basis of an applicant’s residential proximity to the primary school.
Again, this would hardly be contentious if the nation’s most popular schools were equally spread across the country, since this would grant families living in less wealthy neighbourhoods access to top institutions. However, this is not the case.
Many elite schools in Singapore are clustered within its wealthiest neighbourhoods, benefitting those already privileged to have a house there.

Catchment area inequalities​

This final point on distance-based admission has drawn the most controversy among Singaporeans, and understandably so, since it lies at the intersection of various socially charged issues: the value of homes, the location of school and the factors contributing to social inequality.
There is nothing inherently wrong with distance-based criteria for primary school admissions.
In fact, holding all else equal, it makes perfect sense for parents to send their young children to the school nearest to their home.
As Education Minister Chan Chun Sing remarked in a 2022 parliamentary speech, it is “convenien(t) for a child to study in a nearby school as it reduces travelling time, allowing the child and family to spend more time, more meaningfully”.
Yet two uncomfortable truths persist.
First, schools are not perceived as equal across the board. Each year, the same crop of schools receive significantly more applicants than they can take in, indicating that parents clearly perceive stark differences in school quality.
Second, these very same schools are not evenly spread across the country and thus are not within reach of every Singaporean.
Instead, they are intensely clustered in and around the nation’s wealthiest neighbourhoods. Bukit Timah is a prime example, housing well-known schools such as Raffles Girls’ Primary School, Methodist Girls’ School and Nanyang Primary School.
Notably in 2022, in Phases 2A and 2B combined, Methodist Girls’ School received 168 applications for its 89 available places, and Nanyang Primary School received 222 applications for its 176 available places.
The application rates for these two schools were substantially higher than the national average of around one applicant for every two available places.
Taking these facts together, distance-based admissions can no longer claim to be a neutral tool of convenience but, when wielded by the wealthy, become an instrument by which elite boundaries are maintained.
In this way, the Primary 1 registration exercise can inadvertently become a mechanism of socio-economic division, contradicting the open and meritocratic principles upon which it seeks to stand.

These arguments are not mere conjectures, but have been verified by the work of academics.
In 2016, a study conducted by National University of Singapore economist Sumit Agarwal and his colleagues found that real estate prices responded fairly consistently to announcements of school relocations by MOE over a 10-year period from 1999 to 2009.
Lured by the prospects of distance-based entry, parents will go to great lengths – quite literally – to secure for their children a spot in an elite school.
Professor Agarwal and his colleagues’ findings still ring true today.
Following the recent announcement that Anglo-Chinese School (Primary) would move from its Barker Road location to the young town of Tengah, real estate analysts quickly predicted corresponding movements in the housing market for the two localities.
Whether these play out in reality remains to be seen.
In two of our own recent projects, we studied 40 years of school enrolment data stretching back to 1971, analysing school compositions at the primary, secondary and junior college levels, spread across neighbourhoods of different socio-economic characteristics.
Our analysis showed that the concentration of elite schools (primary, secondary and junior college) within wealthy neighbourhoods like Bukit Timah has led to patterns of social segregation along gendered and racial lines over time.
This suggests strongly that elite school statuses have combined with neighbourhood wealth to reinforce patterns of social closure and exclusivity.
Distance-based admissions are not inherently pernicious to social equality. By themselves, they do not foster the kinds of inequality that the state or its concerned public are anxious to solve.
It is only in combination with pre-existing inequalities, namely in neighbourhood wealth and elite school locations, that distance-based admissions become an instrument of socio-economic division.
Good primary schools should ideally be within reach of all students regardless of where they live, but they instead are concentrated within wealthy areas, thus turning distance-based enrolment into a tool of social reproduction.
Nevertheless, one such school has bucked the trend.

From Barker Road to Tengah​

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Anglo-Chinese School (Primary) will be moving from its current Barker Road campus in Newton to Tengah in 2030. ST PHOTO: RYAN CHIONG
We affirm the progressive spirit behind ACS Primary’s planned relocation from Barker Road to Tengah, as well as the opening of its enrolment to girls and special needs students.
This countercultural decision holds the potential to equalise opportunities in at least two ways.
First, young families residing in Tengah, who may not otherwise have had the opportunity to send their children to an elite school in Bukit Timah, can now do so in 2030 when ACS Primary relocates.
Second, the move will likely diversify the demographic mix of its classrooms, thereby promoting greater social mixing among students from different socio-economic and now gendered backgrounds too, given the shift from an all-boys to a co-ed school.
The status quo could have been easily preserved had the MOE and ACS leaders chosen not to pursue this relocation. But they did, causing quite a stir.
Ultimately, the move is a social experiment with inherent challenges and risks, as evident from the concerns expressed among some alumni in recent months.
That it has gone ahead in spite of these concerns demonstrates courage and a promising commitment to equality.

Positive steps towards meritocracy​

The irony of the Primary 1 registration exercise will not be lost on astute observers given the fact that its first few phases rely on network mechanisms that reduce, rather than promote, social mixing.
This would seem both jarring and contradictory to the ideals of meritocracy which in Singapore we have infused into our daily sensibilities.
Regardless, the ACS Primary example illustrates one important principle – social networks can be re-imagined as forms of social mixing, thus promoting the sharing of resources across groups, rather than the reversion to tribalistic forms of social segregation. Instead of tightening its elite circles, ACS Primary’s move to Tengah loosens them.
In his parliamentary speech in April, Mr Chan called attention to the power of social mixing to mitigate inequalities, urging Singaporeans from elite schools to share their networks and opportunities not just with students of their alma mater but with those in other schools as well.
Indeed, considerable research has affirmed the power of cross-class interactions in building social equality.
Recent papers by Harvard economist Raj Chetty and his colleagues illustrate this, showing that social mobility among individuals of a low socio-economic status (SES) can be enhanced by deeper and more frequent connections with high-SES peers.
In the light of this, ACS Primary’s move to Tengah exemplifies one indirect yet potent fix to the Primary 1 registration exercise.
There are times when the pursuit of social equality demands more than just a nominal balancing of differing opinions.
Given that public dialogue over educational elitism and school location has fruitfully intensified over the recent months, it is an opportune moment now to take more seriously the goal of tackling educational inequality, starting first with the Primary 1 registration exercise, but hopefully continuing forward into every corner of the educational system.
  • Cameron Kheng is a research scholar reading his master’s in the Department of Sociology at Nanyang Technological University.
  • Vincent Chua is associate professor in the Department of Sociology and Anthropology at National University of Singapore.
  • Eik Swee is senior lecturer in the Department of Economics at University of Melbourne.
 

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Forum: More help needed for lower-income families affected by rising prices​


SEP 27, 2023

I understand that this year’s 7 per cent fare hike for bus and train rides is necessary to reflect the rising operating costs incurred by the providers of such essential public services.
Likewise, Singapore Post’s increase of 20 cents to mail a basic letter with effect from Oct 9 is necessary to recover rising costs.
On Jan 1, 2024, the goods and services tax (GST) will increase by 1 percentage point to 9 per cent, primarily to defray ballooning healthcare expenditure.
Singaporeans generally accept and trust that the Government will always act fairly in their best interests.
However, as most Singaporeans continue to struggle and cope with the higher cost of living, one wonders if the rising prices of goods and services might trap us in a vicious circle of unending price increases.
The transport fare and GST increases are likely to trickle down into higher operating costs for all businesses, including hawkers and coffee shop operators, who will then be compelled to pass on the incremental costs by raising their prices to remain profitable and survive.
When will this increasing price spiral end?

It is a sad truth that inflation unfairly hits the low-income families hardest, forcing them to endure much hardship and to make many sacrifices.
Meanwhile, the wealthy are probably less affected by inflation and perhaps even benefit from value appreciation of their properties and assets, resulting in a widening wealth gap and greater social inequality.
Although the Government has been rolling out support measures to help low-income families, we should be mindful that they are still most vulnerable, especially the children who might be deprived of some development opportunities as these families scrimp to stay afloat.
Life can become challenging and stressful in an inflationary environment. With reduced real income and purchasing power, some low-income families are prone to becoming dysfunctional, resulting in domestic conflict and disharmony.
In this context, there is the real danger that the children will fall further behind those from wealthy families.
Hopefully, our policy and decision makers, including political leaders, will bear in mind the struggles of those most adversely impacted by high inflation and find more ways to help them.

Ang Ah Lay
 

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The writer is correct. No point trying harder when the top jobs are already reserved for famiLees, cronies, and foreign talent.

Forum: Several reasons for loss in productivity​

Oct 10, 2023

I could not agree more with Forum writer David Lei Li (S’poreans seem less productive after Covid-19, Oct 7).
I can only suggest reasons such as upbringing that does not promote enduring stress, difficulties coping with all forms of stress, and cynicism about hard work leading to success when they see an ever-growing income disparity in society.
The income disparity can result in a “no point trying harder” attitude when people perceive the factors dividing the haves and the have-nots.

Inez S. Perera
 

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Family offices in spotlight over how much value they bring to Singapore​

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The economic impact of family offices has come under the spotlight following a boom in the past few years. PHOTO: LIANHE ZAOBAO
Grace Leong and Lim Min Zhang

JUL 10, 2023

SINGAPORE – The family office of former diamond magnates Nicky and Jonathan Oppenheimer of De Beers fame has made over 10 investments in funds and companies managed or domiciled in Singapore, invested in the region, and is planning to grow its four-person team here.
With the spotlight on single family offices (SFOs) here recently, Mr Edoardo Collevecchio, who has served Oppenheimer Generations for more than five years as chief of staff, said the portfolio is currently focused on early and growth-stage investments. Its Singapore branch – Oppenheimer Generations Asia – was set up in February 2021.
“These are companies that may be hitting between $300 million and up to $1 billion in enterprise value. By focusing on the venture stage, we get to build relationships with the founders as partners, and plant seeds for the future, because early-stage companies will eventually scale up,” he added.
Oppenheimer Generations, which also has offices in Johannesburg, London and Jersey (Channel Islands), wants to tap economic prospects in Asia.
The hope is that a presence in Singapore will spur investments between this region and its home market of Africa, said Mr Collevecchio, who was joined by Ms Ong Yiling, formerly of Singapore’s investment company Temasek, as head of investment.
“There is a dual objective for the Singapore family office – to generate economic returns and get access to the Asia market, and to boost investment synergy between Singapore and Africa. It is both a platform and an investment vehicle,” he noted.
“As part of our long-term strategy in Singapore, we are committed to exploring how we could expand our footprint beyond investments over time, by leveraging our existing commercial, philanthropic and thought leadership activities,” he added.

The Oppenheimer family, according to the Bloomberg Billionaires Index, has a combined net worth of US$8.2 billion (S$11 billion), largely through the 2012 sale of its stake in De Beers, the world’s largest diamond producer, for US$5.1 billion. It is among a growing number of wealthy entrepreneurs flocking to Singapore.
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Staff of Oppenheimer Generations Asia (from left) investment professional Virginie Poetry, managing director Edoardo Collevecchio, finance manager Alex Johnson and head of investment Ong Yiling. PHOTO: OPPENHEIMER GENERATIONS ASIA

Rapid growth​

While the industry is still relatively new in Singapore, the economic impact of family offices has come under the spotlight following a boom in the past few years, as the country rebounds from the Covid-19 pandemic and maintains relative economic stability amid an uncertain geopolitical environment.
The number of SFOs awarded tax incentives by the Monetary Authority of Singapore (MAS) increased to 1,100 as at end-2022, up from 700 in 2021.


Ms Dawn Quek, a lawyer who heads wealth management practice in Singapore at law firm Baker McKenzie Wong & Leow, said potential clients are increasingly looking at both personal and business interests.
“Immigration is a big part of it – because the stability and safety of Singapore, the quality of its education system, its geographic location, and also the way that it has dealt with the pandemic, have made it quite an attractive place and immigration destination for these families,” she noted.
Ms Sim Bock Eng, WongPartnership’s head of specialist and private client disputes practice, said the rapid growth of family offices here is both a consequence of the drive by the Government and factors such as the pandemic.
MORE ON THIS TOPIC
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Singapore adjusts tax incentives for family offices, which must also do more to boost local hires
In March 2019, MAS and the Economic Development Board jointly established a family office development team to enhance the nation’s competitiveness as a global wealth management and family office hub.
“It put in place a nurturing operating environment for family offices which included tax exemption and a light-touch regulatory regime for investment activities carried out by family offices,” Ms Sim said.
“In 2020, with the pandemic, Singapore was an attractive destination of choice for many high-net-worth families because of its geographical location, excellent medical hub and good management of the pandemic, and its expertise as an investment and wealth hub.”
The issue has been on the minds of Singapore’s lawmakers, who have filed numerous questions in Parliament over the past year, amid a number of media reports on how more of the ultra-rich – especially from China – have made Singapore their base for financial asset and estate planning.
Among them was Tampines GRC MP Desmond Choo, who in October 2022 asked about the Government’s plans to work with family offices to deepen investments in local companies. Mr Choo, who sits on the Government Parliamentary Committee for Finance and Trade and Industry, said the impact of such capital inflows has been on the authorities’ radar.
“Whenever we have more inflows of capital, the larger concern is whether the benefits outweigh the costs, such as contributing to asset price inflation and worries about newcomers not being able to fit in with local culture,” he told The Straits Times.
He believes family offices should be judged on factors such as who they hire and whether there is a transfer of entrepreneurial expertise that makes them so successful in their home countries.

SFOs can range from two- to three-person outfits to larger set-ups with a headcount of more than 50, managing significant assets worth billions. Those in Singapore hail from not just the Asia-Pacific but also Europe and America, and are looking to diversify outside their home countries.
Google co-founder Sergey Brin and tech billionaire James Dyson have each set up investment firms to manage their wealth here.
Ms Shu Ping, co-founder of hotpot chain Haidilao, set up a family office here in 2019.
The Government has pointed to how SFOs benefit the economy in two ways: when they employ people directly, and when they create jobs for external service providers such as banks and law firms.
In a parliamentary reply last week, then Senior Minister Tharman Shanmugaratnam said that as at June 2022, SFOs that have been awarded certain tax incentives employed about 1,400 Singaporeans and permanent residents.
About 900 of these jobs were created in just the last three years, he noted, adding that these are generally well-paying. Two-thirds of the Singaporeans and permanent residents at these offices earned more than $5,000 a month. More than 400 earned between $2,000 and $5,000 a month, and fewer than 50 earned less than $2,000.
Some Singapore businesses, such as car-sharing firm GetGo, have also benefited from investments made by wealthy families. The start-up raised $20 million from family-led investment firm Treis Group earlier in 2023.
GetGo chief executive Toh Ting Feng said the significant investment “allows us to hasten the electrification of our fleet and extend our technology leadership in shared and sustainable mobility”. It currently has a fleet of about 2,500 cars, including about 200 electric vehicles.
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GetGo chief executive Toh Ting Feng said investments made by wealthy families “allows us to hasten the electrification of our fleet and extend our technology leadership in shared and sustainable mobility”. PHOTO: GETGO
It is this belief in such payoffs that has led advocates to ask for more time and support to grow the industry.
West Coast GRC MP Foo Mee Har, in a Parliament speech in April, said family offices could allow Singapore-based businesses to benefit from their networks, innovation and talent, as she called for more to be done to orientate them to the country’s norms, values and ways of working.
Family offices are typically extremely private, she noted. “Recent reports of flashy and ostentatious behaviours are restricted to a minority.”
At an annual report briefing last Wednesday, MAS chief Ravi Menon said wealth inflows into Singapore have little effect on the exchange rate, domestic inflation, property prices or car prices, as most wealth managed here is invested outside the country.
He attributed the rise in inflation mainly to sharp increases in global energy and food prices, and stronger domestic wage growth.
Mr Menon pointed out that the bulk of wealth flows into Singapore come from institutional investors, and not family offices or high-net-worth individuals.
Foreigners accounted for an average of 4 per cent of private residential property transactions over the last three years, he noted, adding that there were no purchases by SFOs in that period. Their foreign employees accounted for “an insignificant number” within the 4 per cent, he added.
“Likewise, SFOs and their foreign employees account for a tiny proportion of car purchases in Singapore,” he said.

New requirements​

More is being done to ensure more positive spillover effects from SFOs. Mr Menon said the authority will be adjusting tax incentives for SFOs to encourage them to deploy their capital more purposefully to benefit Singapore and the region, as well as increase their contributions towards environmental and social causes.
Among the changes he announced is a new requirement for SFOs to hire at least one investment professional who is a non-family member. This is meant to expand the pool of jobs for such professionals here.
On its part, Oppenheimer Generations has spent more than $4.5 million on operation costs, service providers and fees to Singapore-licensed fund managers.
When asked about the SFO’s contributions to the Singapore economy, Mr Collevecchio said family offices “represent multi-generational, patient capital and often have a much longer time horizon than most investors and corporates”.
“As such, it is difficult to make a final verdict about the experience to date – most families’ strategies will mature over time, and it would be more appropriate to measure their contribution to and assimilation into society over years and decades,” he added.
 

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Wealthy here should contribute to society, adhere to Singapore’s norms: DPM Wong​

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Deputy Prime Minister Lawrence Wong said the wealthy in Singapore are expected to “do their part, pay their dues and give back to society”. PHOTO: LIANHE ZAOBAO
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Tham Yuen-C
Senior Political Correspondent

SEP 14, 2023


SINGAPORE - The wealthy who park their funds in Singapore should contribute to society through taxes and philanthropy, and adhere to the country’s norms against ostentatious displays of wealth, said Deputy Prime Minister Lawrence Wong on Wednesday.
Speaking to a roomful of business leaders and policymakers, he added that Singapore’s interest in the financial flows into the country is not in the funds specifically, which are highly mobile. Rather, it is in building capabilities in the financial services sector and creating jobs for Singaporeans, to maintain the social compact.
Mr Wong was speaking on the first day of the three-day Milken Institute Asia Summit 2023, held at the Four Seasons Hotel Singapore, during a dialogue moderated by the institute’s chief executive Richard Ditizio.
The growth of the assets managed in Singapore to about $5 trillion and the establishment of some 700 family offices here have given a boost to the country’s asset management industry, but has also led to a perception of growing inequality, said Mr Ditizio.
Asked how Singapore manages this, Mr Wong, who is also the Finance Minister, said it was an issue the Government monitors carefully.
That Singapore has continued to attract investments, capital and talent amid a more turbulent global environment has been a positive thing, but such inflows can also bring about challenges, he acknowledged.
To mitigate against the downsides, the wealthy here are expected to “do their part, pay their dues and give back to society”, he said.

Elaborating, he said the family offices that set up shop in Singapore are encouraged to set up philanthropic arms and most do so, and the wealthy also contribute through taxes.
Noting that Singapore’s philosophy is a straightforward one in which everyone has to pay taxes, Mr Wong said “the rich pay more, and if you’re very rich, you pay very many taxes”, while those who are less well off benefit more from government spending.
Another thing the Government has done to address the perception of inequality, which is “not as easy as philanthropy or taxes”, is to engage the new arrivals to remind them about Singapore’s values and way of life, he added.

“We reach out to these groups, we tell them Singapore is an inclusive and egalitarian society. We are a place with an informal and egalitarian ethos where people can interact freely with one another comfortably as equals, where we frown on ostentatious displays of wealth,” he said.
“So these are our house rules. If you’d like to be here, please follow our norms, follow our rules. If you think they are not for you, that’s okay. You can take your money and you can go elsewhere. We won’t hold it against you,” Mr Wong said to laughter from the audience.
At the same time, the Government had worked to ensure that hot foreign monies do not flow into the residential property market and make housing unaffordable for Singaporeans. To this end, there are very strict rules governing the sale of property to foreigners and the rules have been tightened twice in the last three years, he added.
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Deputy Prime Minister Lawrence Wong at the Milken Institute Asia Summit 2023, during a dialogue moderated by the institute’s chief executive Richard Ditizio. PHOTO: LIANHE ZAOBAO
Ultimately, maintaining the social compact and keeping society strong and united are vital for the continued support of Singapore’s economic model, he said.
“We are very fortunate in Singapore to start with a very high level of trust and a strong sense of solidarity in our society, and we are determined to do everything we can to keep it that way,” Mr Wong added.
This is done through ensuring real income growth and continued improvements in the standard of living for the broad middle of society and tackling challenges of inequality and social mobility, which are becoming sharper as society matures and the population ages, he said.

Efforts in these areas have seen good results in recent years, added Mr Wong, citing how median incomes have been rising in real terms after netting off inflation which has been higher, and how lower-income groups have enjoyed higher income growth compared with the rest of the workforce.
The Forward Singapore exercise that he and his fourth-generation political leaders have embarked on is meant to further strengthen the social compact, such as through supporting workers in reskilling so they can get good jobs throughout their careers and giving help to the unemployed to tide them through their immediate difficulties, he said.
“It will entail more government spending, more investments in workers, in our human capital, but it will be spending well worth making and investment well worth making in order to keep our society strong and united, and to continue to get sustained support for our economic model which is open, vibrant, competitive and vital for Singapore’s success,” he said.
During the wide-ranging dialogue, Mr Wong and Mr Ditizio also discussed the changing geopolitical backdrop, how Singapore has continued to attract investments, and challenges brought by climate change and artificial intelligence.
 

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Overcoming the visible social divide and the responsibility of the rich​

The uber-rich who now call Singapore home can either fuel resentment or learn to build bridges with their new ‘family’.​

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Tham Yuen-C
Senior Political Correspondent
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Wealth so vast can also highlight inequalities in society, and threaten the social fabric in a country becoming more class conscious than before. ST PHOTO: KUA CHEE SIONG

Oct 20, 2023

At a forum in September organised by the economic think-tank Milken Institute Asia, Deputy Prime Minister and Finance Minister Lawrence Wong touched on how the wealthy who come to Singapore should live.
He was asked about how the Government can balance the twin goals of managing inequality, while attracting the ultra-rich, whose glamorous lifestyles have sometimes seemed at odds with Singapore’s egalitarian ideals.
To hear him say it, the easier task is ensuring that the new arrivals contribute economically by making investments that create jobs, paying taxes that contribute to the coffers, and helping others through philanthropy.
The harder part? Reminding them about Singapore’s values and way of life.
He said: “We reach out to these groups, we tell them that Singapore is an inclusive society, we are a place with an informal and egalitarian ethos, where people can interact freely with one another comfortably as equals, where we frown on ostentatious displays of wealth.
“So these are our house rules. If you’d like to be here, please follow our norms, follow our rules. If you think they are not for you, that’s okay. You can take your money and you can go elsewhere. We won’t hold it against you.”
His remarks drew nervous chuckles from the audience in the room, some of whom had no doubt pulled up earlier at the Four Seasons Hotel – the event venue – in chauffeur-driven marquee cars.

The changing complexion of Singapore society​

By the estimate of investment migration firm Henley and Partners, which helps the wealthy relocate, there are about 240,100 millionaires, 329 centi-millionaires (those worth more than $100 million), and 27 billionaires in Singapore, surpassing even the numbers in Asia’s richest cities Hong Kong and Tokyo.
This bodes well for the country’s ambitions as a financial hub. Emerging from the Covid-19 pandemic, Singapore has seen an influx of wealth, with some 700 Asian, European and American single-family offices having set up shop here by the end of 2021, and total assets under management in Singapore growing to $5.4 trillion by 2021.
Yet, wealth so vast can also highlight inequalities in society, and threaten the social fabric in a country becoming more class conscious than before. An Institute of Policy Studies survey in 2018 found that class, and not race or religion, had become the biggest divide in Singapore, with people being judged on where they live and the schools they went to.

Amid this development, the uber-rich have wrought yet more changes. From the million-dollar luxury cars that ply the roads, to entire private apartment blocks being snapped up, and pricey golf club memberships going for more than $800,000, their glamorous lifestyles have sometimes flagged their wealth even more visibly.
National University of Singapore Business School professor of real estate Sing Tien Foo, who co-authored a paper on foreign property buyers in 2020, had observed a propensity for “conspicuous consumption” among some of the newly arrived wealthy, who tended to opt for the most ostentatious properties in a development, such as the penthouses.
That their preferred properties are in the core central region and on Sentosa, where non-citizens are allowed to buy landed property, has also created loose enclaves, he says.

A creeping unease​

A creeping unease seems to be spreading, as Singaporeans and the new arrivals grapple with living side by side on the tiny island. In online forums and coffee shops, some lament that Singapore has become a “playground for the rich”, while others warn that the rich will “eat us alive”.
National University of Singapore sociologist Tan Ern Ser reckons that while Singaporeans understand that they live in a capitalist society and believe in meritocracy, this is predicated on there being equality of opportunity.
“So long as there is enough to go around, things are fine. A positive-sum situation of sorts exists,” he says.
“However, when they perceive the rich as contributing to depriving them of the comfort and security of a middle-class lifestyle, and practising conspicuous consumption, they would see a conflict of interest in operation, a zero-sum game.”
As rising prices hit the living standards of Singaporeans and the middle class find themselves having to pay more to own a home and a car, some “would be more inclined to attribute the problem to those who have the purchasing power to drive up prices, and making it difficult for them to even manage a middle-class lifestyle comfortably”, adds Dr Tan.
Even the better-off face their own stresses, as they struggle to keep up with the Joneses and to ensure that their children do as well as themselves.
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ST ILLUSTRATION: MIEL

Resolving the visible divide​

These issues are not unique to Singapore, but they may be felt more sharply on a small, densely populated island that keeps its doors open to the world. There are concerns that a visible divide may unravel the cohesiveness which has bound the people and the Government together since the country’s independence.
Singapore has always prided itself on being an egalitarian society and much of the Singapore identity is bound up with the idea that anyone can do well in life here regardless of family connections and wealth.
This can sometimes seem unattainable, with the rich having upped the ante of what it means to do well.
Recognising this, the fourth-generation political leaders, led by Mr Wong, have made addressing inequality and social mobility one of the key focuses of the Forward Singapore exercise to renew the social compact.
At the Economic Society of Singapore (ESS) annual dinner in September, Mr Wong spoke about how the Government will work to advance the well-being of the broad middle, while uplifting the lower-income and sustaining social mobility, especially for the disadvantaged.
There are plans in the works to invest more in adult training through a strengthened SkillsFuture system. Credit top-ups for mid-career workers and unemployment support for those who are laid off are also on the cards.
These moves will no doubt create a more even playing field, but the haves and the have-nots could still be pitched against each other in an us-versus-them narrative.

The responsibility of the rich​

To reconcile the disparity, “it is more important that the rich contribute positively to Singapore, not just in terms of investment, which has less of a visual effect, but also in terms of donations to charity”, suggests Dr Tan, adding that this should be done without too much fanfare.
Mr Wong had, at the ESS dinner, said Singapore’s efforts to build a more inclusive society must not be limited to monetary redistribution and government policies, but must also involve the community.
“Those who have done well in life should feel a sense of responsibility to help uplift their fellow citizens,” he said.
It was this same sentiment that spurred steel magnate Andrew Carnegie to publish The Gospel Of Wealth in 1889, in which he wrote about how the wealthy should repay their debt to society and reduce inequality by giving away their wealth.
“The man who dies thus rich dies disgraced,” he had declared in the essay on money now seen as an early text on modern philanthropy.
Having made their fortunes during the turn of the 20th century when rail opened up the country, Carnegie and other industrialists like oil tycoon John D. Rockefeller then set their sights on improving the lives of others through philanthropy, eventually building societal edifices that raised the bar for the whole of society.
Carnegie endowed thousands of libraries and schools, one of which would become part of Carnegie Mellon University. Meanwhile, Rockefeller established the Rockefeller Foundation that worked to tackle malaria, hookworm and yellow fever, and funded hunger relief efforts in Europe after World War I. The foundation also donated to Asia, giving birth to the non-profit Asia Society to help promote understanding of Asia.
More recently, the Gates Foundation, set up by Microsoft founder Bill Gates and his former wife Melinda Gates, donated US$2 billion (S$2.7 billion) to combat the Covid-19 pandemic.
Closer to home, the Tanoto Foundation, set up by the Tanoto family that runs pulp, paper and palm oil giant Royal Golden Eagle, has donated $2.6 million to fight diabetes and $2 million to the Rare Disease Fund in Singapore.

Philanthropy as public good​

This use of private wealth for the public good is not without controversy, and there have been critiques of how such philanthropy can concentrate the power to influence the public agenda in the hands of a small group of elite and perpetuate class divisions.
Some also see it as a ploy to avoid taxes on massive fortunes that they believe will be better redistributed through governments, or as a way to launder reputations.
The challenge then is for the Government to ensure that taxes are appropriately applied and philanthropy is not exploited for less-than-noble purposes. Philanthropy – which literally means “a love of the people” in Greek – must simply be devoted to improving lives.
Philanthropy is not an end in itself; it must be done in a way that actually serves the goal of strengthening our social fabric and ironing out the creases of inequality. This will require foundations to spend time on the ground to identify causes that truly need their support.
The last thing we want is to create the perception that the uber-rich can justify their existence simply by having “thrown” money at various charitable causes.
In encouraging those who are better off to think of others, Mr Wong urged people to rethink their definition of family. “Perhaps we should look at family in a wider context – not just our children or our grandchildren, but people in our wider community who belong to our Singapore family,” he said.
Many of the ultra-rich who have come to Singapore have not just parked their money here, but have also brought their families. When they give of their largesse to society, it will hopefully be with the desire to improve this home.
 

True Believer

Alfrescian
Loyal
Why do you want the government to punish the successful? It's the useless, lazy good for nothing low income louts that should be in the firing line.
If the Govt takes from the rich to distribute to the poor like a welfare state, many of the poor will simply become lazy and depend on handouts. Many of the rich also may decide to leave SG since they are already paying far more in both direct and indirect taxation than the low SES and have to support them.
 

Leongsam

High Order Twit / Low SES subject
Admin
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Why not just get rid of all those damned heartlander parasites who do nothing but burden the Singapore system. Send them on a one way ticket to Batam Island.
 

realDonaldTrump

Alfrescian
Loyal
Three articles in 4 days from the same media, are they trying to whitewash?
https://www.channelnewsasia.com/singapore/big-read-sky-high-coe-prices-singaporeans-cars-land-transport-3845991
https://www.channelnewsasia.com/com...ecord-premiums-expensive-private-hire-3857871
https://www.channelnewsasia.com/singapore/coe-prices-cars-system-failures-tweaks-analysts-3852336

Are cars also used for money laundering in Singapore?
car transfer fee is only $25

Some luxury cars just sold out immediately when launches, such buyers are usually all born in China with passports in St Kitts, Vanuatu, Cambodia, Dominica, with mailing address in Malaysia and Singapore hahaa

Just like other countries' washing machines, use yachts and private jets detergents.
Singapore uses cars
 

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Forum: High cost of living creates a dent in dream of pursuing one’s passions​


Oct 23, 2023

In Singapore, prosperity and progress have long been lauded and are key tenets of our society.
Once obsessed with the 5Cs _ cash, car, credit card, condominium, and country club membership _ have we now moved away from the era of unbridled materialism? A growing minority champion a departure from this consumer-driven dream, yet the majority still find themselves tethered to the pursuit of high-paying mainstream careers.
The relentless surge in the cost of living is a key disincentive to Singaporeans exploring their passions and interests outside of convention when deciding on life choices. I’ve seen friends opting for gap years or venturing into entrepreneurship, seeking to fulfil their passions. However, the harsh reality is that these non-mainstream career choices often involve arduous work and may come with lower salaries than those of white-collar professions.
More often than not, reality comes knocking, and the high cost of living in Singapore emerges as a formidable adversary. The dream of pursuing one’s passions frequently loses out to the necessity of securing a stable pay cheque. Singaporeans who choose alternative career paths are justified in harbouring some materialistic aspirations. There should not be a dilemma about making trade-offs between enjoying a comfortable quality of life and pursuing other career paths that may align with their passions and interests. Those opting for alternative careers simply desire to live comfortably, indulge in the occasional treat, and not have to worry about financial stability.
The Government’s emphasis on hard work yielding the fruits of our labour was a truism in past generations. I have older family members who, despite lacking a university degree, were able to purchase a three-bedroom condominium in their early 30s. Can the same be said for non-graduate Singaporeans today? The economic landscape has changed drastically, and even graduates today find themselves grappling with the challenge of acquiring a resale HDB flat.
While it’s true that salaries are on the rise, particularly in high-end jobs, the growth is sluggish for blue-collar workers and non-graduates. The economic pie must be more evenly distributed, allowing every segment of society to enjoy the prosperity that Singapore has worked so hard to achieve.
The Government must take measures to alleviate the burden of the high cost of living, ensuring that the dreams and aspirations of every Singaporean, regardless of their passions, interests or educational background, have room to flourish.

Ryan Ang
 
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