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http://www.tremeritus.com/2015/08/14/sgs-reserves-increasingly-a-hot-political-issue/
[h=2]SG’s reserves increasingly a hot political issue[/h]
August 14th, 2015 |
Author: Editorial
SingFirst has invited 3 speakers to speak on Singapore’s national reserves at
its 3rd Public Forum tomorrow (15 Aug).
The 3 prominent Singaporeans will speak on their concerns regarding our
national reserves. They are:
All 3 regularly blog and talk about financial matters online. They have
contributed many articles to TR Emeritus (TRE) in the past, and continue to do
so.
TRE was able to catch up with Chris Kuan and Leong Sze Hian to find out why
they are so passionate about our reserves. Kenneth Jeyaretnam, understandably,
is busy preparing for the upcoming general election.
TRE interviewed Chris recently:
TRE: Chris, what brings you to write extensively about the
reserves?
Chris: Funny that you should ask this. I met your Chief
Editor, Richard Wan, over lunch more than a year and a half ago. He asked if I
could look into what he called a very hot issue.
TRE: You seem eminently qualified to do this, can you tell
us about your experience and training?
Chris: Well, I regret to disappoint you but I never attended
university nor had a diploma or professional qualifications. I did work 34 years
in the financial markets – the majority in London and Tokyo where I gathered
very extensive experience perhaps not available in SG and had good bosses. In
the last 10 years I headed capital markets and treasury for the Asia-Pacific
region.
TRE: You seem very persistent in analysing Singapore’s
reserves, what motivates you?
Chris: A lot of things really. At first I took it as a
challenge and to help the man in the street to understand a bit more about the
reserves. As my research took me further into the subject, not least being urged
by helpful TRE readers who asked me to look into this or comment about that, I
began to realise the enormous socio-economic costs to the ordinary citizens in
the government’s relentless accumulation of reserves. I strongly believe that
the citizens have a right to know because those reserves impose huge burdens on
them.
TRE: Do you need to be an expert to analyse the
reserves?
Chris: Not really. I am not really one myself. Some
background in reading balance sheets and analysing simple portfolio metrics will
be very helpful. Also need to keep a level head and not overreach or jump to a
pre-conceived answer. I learned to avoid that the hard way when I was young and
foolish, haha.
TRE: It cannot be easy?
Chris: No, no, not easy at all. Digging out the information
and trying to make sense of it is the tough bit. I went up a few blind alleys,
mostly because the government, i.e. the MOF (Ministry of Finance), the ministers
and the SWFs (sovereign wealth funds i.e. GIC and Temasek Holdings) were very
inconsistent about what they say about the reserves. Prime example is at first
GIC did not manage CPF and then GIC did.
TRE: Why is that so?
Chris: I always believe that when there is non-transparency
and non-accountability, government tends to become indolent or lazy about the
way they disclose information.
TRE: What do you hope to gain out of this?
Chris: Finance and economics I always believe are the most
important factors in politics. We say let’s do more for the poor, let’s
un-squeeze the “squeezed middle” – these are socially just, commendable goals
but ultimately the finance and the economics need to align to deliver these
goals. And I like to say that finance and economics have a wide range of
nuances, interpretations and outcomes: some good, some bad and nearly always the
good cannot be had without the bad or what I often call trade-offs.
TRE: So there must be alternative views?
Chris: Yes we must. It is too important not to. A bunch of
scholars trained in the PAP’s right-wing thinking and another bunch brought up
in centrist or left-of-centre social market will come up with different
solutions to the same socioeconomic problems. Unfortunately, in Singapore, the
public is informed only of one narrative without any alternatives. Social media
is very important.
TRE: How are you connected to SingFirst?
Chris: Well, Tan Jee Say and I exchanged a few emails on the
subject. He invited me to the forum. I was reluctant to attend at first because
the timing was inconvenient. But then Richard Wan convinced me of the need to do
National Service again, haha.
TRE: Are you standing for election?
Chris: Heavens no. Don’t think I am MP material. No,
personal commitments keep me [away] from Singapore. I do my part by helping the
ordinary people understand the politics of finance and
economics.
When TRE asked Leong Sze Hian why he is so passionate about our reserves, he
emailed the following to us:
I have written more than a hundred articles relating to the reserves in the
last 15 years or so. The fundamental question is why do we need to keep
accumulating more reserves?
In this connection, the budget surplus for FY2011, 2012, 2013 and 2014 was
$2.32, 3.86, 3.92 and -0.13 billion, respectively. In other words, the
cumulative budget surplus from FY2011 to 2014 was $9.97 billion.
The budget estimate for FY2015 is a deficit of $6.67 billion, but this is
after a $6 billion top-ups to endowment and trust funds, which under IMF fiscal
reporting guidelines may not be allowed as an expenditure item.
But the estimated cash budget surplus under IMF fiscal reporting guidelines
is more than $24 billion for FY2014, and also more than $20 billion
every year in the last five years or so.
So, as you can see, the government reports one thing to the citizens in
Parliament but reports another to IMF (under IMF fiscal reporting
guidelines).
We need more transparency from the government with regard to our reserves.
That is the motivation why I keep pressing on the issue of our reserves, which
belongs to Singaporeans and not the government.
At the end of the day, one has to ask – how have the huge reserves benefited
the man in the street?
Anyone who wants to know more about Singapore’s reserves can listen to the 3
experts speak at Hotel Royal (36 Newton Road), 2pm tomorrow (15 Aug) – see: 3 speakers at SingFirst forum: SG’s national reserves.
No doubt, Singapore’s reserves are increasingly a hot-button issue as
Singaporeans become more politically aware.
[h=2]SG’s reserves increasingly a hot political issue[/h]
August 14th, 2015 |
Author: Editorial
SingFirst has invited 3 speakers to speak on Singapore’s national reserves at
its 3rd Public Forum tomorrow (15 Aug).
The 3 prominent Singaporeans will speak on their concerns regarding our
national reserves. They are:
- Chris Kuan, retired international banker: How much reserves
does Singapore have? What is the relationship between reserves, budget surpluses
and CPF savings? What returns have they earned? How much of these returns comes
from investing our CPF savings?
- Leong Sze Hian, financial analyst and statistician: What is
the difference between the returns on CPF savings that GIC has earned from
investing them and the returns that CPF members are given by the government?
What is the practice of pension funds outside Singapore e.g. Malaysia’s
EPF? Have Singaporeans been shortchanged?
- Kenneth Jeyaretnam, economist and Secretary-General of the Reform
Party: Are Singaporeans over-taxed and under-provided for? Don’t we
deserve more?
All 3 regularly blog and talk about financial matters online. They have
contributed many articles to TR Emeritus (TRE) in the past, and continue to do
so.
TRE was able to catch up with Chris Kuan and Leong Sze Hian to find out why
they are so passionate about our reserves. Kenneth Jeyaretnam, understandably,
is busy preparing for the upcoming general election.
TRE interviewed Chris recently:
TRE: Chris, what brings you to write extensively about the
reserves?
Chris: Funny that you should ask this. I met your Chief
Editor, Richard Wan, over lunch more than a year and a half ago. He asked if I
could look into what he called a very hot issue.
TRE: You seem eminently qualified to do this, can you tell
us about your experience and training?
Chris: Well, I regret to disappoint you but I never attended
university nor had a diploma or professional qualifications. I did work 34 years
in the financial markets – the majority in London and Tokyo where I gathered
very extensive experience perhaps not available in SG and had good bosses. In
the last 10 years I headed capital markets and treasury for the Asia-Pacific
region.
TRE: You seem very persistent in analysing Singapore’s
reserves, what motivates you?
Chris: A lot of things really. At first I took it as a
challenge and to help the man in the street to understand a bit more about the
reserves. As my research took me further into the subject, not least being urged
by helpful TRE readers who asked me to look into this or comment about that, I
began to realise the enormous socio-economic costs to the ordinary citizens in
the government’s relentless accumulation of reserves. I strongly believe that
the citizens have a right to know because those reserves impose huge burdens on
them.
TRE: Do you need to be an expert to analyse the
reserves?
Chris: Not really. I am not really one myself. Some
background in reading balance sheets and analysing simple portfolio metrics will
be very helpful. Also need to keep a level head and not overreach or jump to a
pre-conceived answer. I learned to avoid that the hard way when I was young and
foolish, haha.
TRE: It cannot be easy?
Chris: No, no, not easy at all. Digging out the information
and trying to make sense of it is the tough bit. I went up a few blind alleys,
mostly because the government, i.e. the MOF (Ministry of Finance), the ministers
and the SWFs (sovereign wealth funds i.e. GIC and Temasek Holdings) were very
inconsistent about what they say about the reserves. Prime example is at first
GIC did not manage CPF and then GIC did.
TRE: Why is that so?
Chris: I always believe that when there is non-transparency
and non-accountability, government tends to become indolent or lazy about the
way they disclose information.
TRE: What do you hope to gain out of this?
Chris: Finance and economics I always believe are the most
important factors in politics. We say let’s do more for the poor, let’s
un-squeeze the “squeezed middle” – these are socially just, commendable goals
but ultimately the finance and the economics need to align to deliver these
goals. And I like to say that finance and economics have a wide range of
nuances, interpretations and outcomes: some good, some bad and nearly always the
good cannot be had without the bad or what I often call trade-offs.
TRE: So there must be alternative views?
Chris: Yes we must. It is too important not to. A bunch of
scholars trained in the PAP’s right-wing thinking and another bunch brought up
in centrist or left-of-centre social market will come up with different
solutions to the same socioeconomic problems. Unfortunately, in Singapore, the
public is informed only of one narrative without any alternatives. Social media
is very important.
TRE: How are you connected to SingFirst?
Chris: Well, Tan Jee Say and I exchanged a few emails on the
subject. He invited me to the forum. I was reluctant to attend at first because
the timing was inconvenient. But then Richard Wan convinced me of the need to do
National Service again, haha.
TRE: Are you standing for election?
Chris: Heavens no. Don’t think I am MP material. No,
personal commitments keep me [away] from Singapore. I do my part by helping the
ordinary people understand the politics of finance and
economics.
emailed the following to us:
I have written more than a hundred articles relating to the reserves in the
last 15 years or so. The fundamental question is why do we need to keep
accumulating more reserves?
In this connection, the budget surplus for FY2011, 2012, 2013 and 2014 was
$2.32, 3.86, 3.92 and -0.13 billion, respectively. In other words, the
cumulative budget surplus from FY2011 to 2014 was $9.97 billion.
The budget estimate for FY2015 is a deficit of $6.67 billion, but this is
after a $6 billion top-ups to endowment and trust funds, which under IMF fiscal
reporting guidelines may not be allowed as an expenditure item.
But the estimated cash budget surplus under IMF fiscal reporting guidelines
is more than $24 billion for FY2014, and also more than $20 billion
every year in the last five years or so.
So, as you can see, the government reports one thing to the citizens in
Parliament but reports another to IMF (under IMF fiscal reporting
guidelines).
We need more transparency from the government with regard to our reserves.
That is the motivation why I keep pressing on the issue of our reserves, which
belongs to Singaporeans and not the government.
At the end of the day, one has to ask – how have the huge reserves benefited
the man in the street?
experts speak at Hotel Royal (36 Newton Road), 2pm tomorrow (15 Aug) – see: 3 speakers at SingFirst forum: SG’s national reserves.
No doubt, Singapore’s reserves are increasingly a hot-button issue as
Singaporeans become more politically aware.
