11/11/2006

inspired by mah bow tan

After listening to Mah Bow Tan’s plan to build more rental flats for the less well off citizens, I am truly inspired. The govt is now actively tackling the problem of the poorer Singaporeans and to help them. More empty flats will be converted to 1 rm and 2 rm rental flats to solve the problems of housing for the poor. And the rentals will definitely be affordable, calculated with computer precision to fit the income of the poor Singaporeans. This is to prevent the more well off Singaporeans from taking advantage of the system and deprived the more needy Singaporeans of rental flats.

So what will happen is that the household income of the family will be carefully scrutinized not only on eligibility but also to determine how much each family will pay for the rental of the flat. A family with a higher income will have to pay more than a family with a lower income. This kind of micro management to ensure that the poor cannot abuse or cheat the system is one of its kind in the world. It is an obsession to make sure that the poor are managed to every detail of the little money they have. Put them under the microscope. And once they earn a little more, they should be made to pay a little more. This is absolutely fair and righteous. This is equitability at its best. Means testing was not mentioned, but means testing will have to be done to assess affordability.

This principle of paying according to income or affordability is the most ingenious part of the solution. It convinces me that means testing is important and relevant in the Singapore context. Though I have always been against means testing, I am now a convert for means testing. It is the fairest and most equitable way of distributing national resources and be paid according to one’s ability. I would like to see Mah Bow Tan proposing this formula in Parliament to apply to all govt services, including tuition fees in schools and tertiary education, ward charges for hospitalization, utilities, road taxes etc.

And for this scheme to be effective and implemented across the board, all Singaporeans must be means tested. Testing only the poorer Singaporeans is discrimination by wealth and is disgusting. Also, since all govt services and fees are to be paid according to affordability, it is necessary to means test the more affluent Singaporeans to ensure that they pay more for the same govt and public services. As an example, the price of a 5 rm flat should vary according to the family income of the buyer. Or hospital ward charges shall be computed according to the patient’s family income and applicable to A, B and C wards. School and university tuition fees shall be also payable according to the family’s income. The higher the family income, the higher should be the fees. It is the fairest and gracious formula for the better off citizens to cross subsidise for their poorer counterparts.

With such an equitable scheme where those who can afford more pay more and those who can afford less pay less, the govt will be seen as fair and progressive instead of being mean and petty if means testing is only applicable for the poor. I will definitely support such a great scheme.

18 comments:

Anonymous said...

this system is tantamount to profit maximization based on the demand curve on economic theory. Its amazing how one can pass this of as public service for the poor to prevent richer singaporeans from taking advantage. It more like explioting the poor for maximum profit extraction.

Anonymous said...

I think we need to know what we wish the govt to do instead of aimless complaining. I would prefer the anony post above to help make more sense of this crazy world. Your post does not help anyone, anything. Let us be positive and give the govt some semblance of credit if they are going in the right direction. Thanks Redbean!
TC

Anonymous said...

ha ha...just like in the Soviet Union... "Each gives according to his ability, each receives according to his need." Maybe Singapore will be successful like them.

Anonymous said...

do you guys know Monkey Tan is LKY's favourite? Just look at his track record, whichever ministry and stat board he went he was instrumental and very good in raising revenue for his boss/master and squeezing the peasants.

redbean said...

the new slogan should be 'pay according to your means.'

did they praise durai for raising all the millions? better than anyone in the private sector?

redbean said...

hi TC, welcome to the blog.

almost miss your little signature at the end.

Anonymous said...

Would be nice if they apply a similar meticulous principle to allocating ministerial salaries by say, pegging them to actual performance and booboos made, to avoid wastage of resources.

kwayteowman said...

Perhaps you can explain to us the problem with means testing? :-)

What's wrong with the middle-class paying more so that the poor can pay less? :-P

redbean said...

hi kwayteowman,

welcome to the blog.

morally, means testing is bad. as often than not, means testing is applied against the poor. and also it strips one of everything, ego and pride and self respect. it is like being handcuffed in a police station and made to answer every question they throw at you.

ok, poor people who are hungry and begging for charity have no pride. they deserve to be probed, insulted and made to go down on their knees. i like that. all these leeches better learn to take care of themselves.

oh, i got carried away thinking that i am an elite. to be fair, if anyone thinks that means testing is a decent thing to do, make sure that they themselves should be subject to the same means testing.

that is why i say anyone consuming govt services must subject themselves to means testing. if mr rich wants to go to A ward in the hospital, means test him and charge him accordingly. mr not so rich, means test him and charge him according to how much he can afford.

this squeezing the poor and hardup people is a past time of the rich and mighty. it is their kind of mentality. it is so normal and the right thing to do.

never do to others what you would want others do to you.

kwayteowman said...

Redbean,

The KTM is unfortunately unable to understand your logic. Means testing is all about allocation of resources to those who need it most.

When it comes to medical services, we need to give out subsidies. If you go to class A wards, you get no subsidies, so there's no need to test you. If you got to the C class wards, then you will getting some subsidies, which means that you are depriving another person of the same. Beds unfortunately are also limited.

In the past, since healthcare costs are significantly lower, the Garmen had no need to resort to means testing since the amounts of subsidies involved were smaller. Also, the Class A, B and C system was sufficient for patients to self-administer the means test.

As healthcare costs rise, the amounts of subsidies involved become correspondingly greater and because we do not compromise on the quality of healthcare (or at least that's what the KTM heard), Class C isn't too bad. People should go and visit the hospitals in the neighbouring countries and see for themselves the difference between our Class C wards and their best wards. The KTM would take our Class C ward anytime.

In any case, note that means testing is also applied at the top US colleges in the form of financial aid. Basically students will get an amount of financial aid that is dependent on their household incomes.

Suppose the Garmen doesn't go means testing but lets the healthcare costs for the Class B and C rise. Then hor, start a new Medi-Something Fund from which Singaporeans can apply for subsidies. It's not compulsory hor. You feel like it, you apply. You don't apply, no one will force you. Are you happier with this proposal? :-)

Given the resistance to means testing, the KTM will not be surprised if this is the approach that Minister Khaw will come up with. There are many ways to package a pill. People dun want to swallow the blue one, paint it red and tell them it's a sweet. ;-P

BTW, the KTM is perfectly willing to subject himself to be means tested. :-P

redbean said...

hi ktm,

thanks for disagreeing. otherwise it will be too boring. and don't worry, disagreeing is not complaining here: )

the concept of means testing in principle is fair. but in practice it is wicked. it is normally enforced on the poor buggers who come begging on their knees, and crying. the the rich and mighty will want to embarrass them further by subjecting them to more humiliation. but then the elite will say, when you are a beggar you can't be choosers, or you cannot have any pride or dignity when you are hungry. that is one aspect which i find very mean.

the second point is, what is wrong with people who want to be thrifty and just want medical treatment without the frills? like you say, you are very comfortable with C wards. so do i. why can't the govt provide more c wards when there is a great demand for it? why insists on having more higher and more expensive wards when people refused to pay for them? and then complain that the people did not have enough savings for old age?

then your argument about subsidies? what subsidies? it all depends on what formula you are using to define subsidy.

and those who are slightly better off are already paying more taxes. what is wrong if it is a personal choice to lower his standard to go to c ward? why must he be forced to feed on sharksfin if he doesn't want it?

the people must be given the choice to decide what he wants to spend. not forced choice.

kwayteowman said...

The point here isn't about B or C class ward. The bulk of the healthcare costs doesn't come from how many people stay in the same room.

The B or C class thing was a mechanism that was used (successfully) in the past to get the patients to do indirect means testing on themselves.

The point is the amount of subsidies that are going to the different classes of patients. The quantum of these subsidies are increasing because of the rising costs of healthcare.

Why exactly healthcare costs are rising is a question that the KTM knows nothing about. For the sake of the current debate, let's take this as a given.

"like you say, you are very comfortable with C wards. so do i. why can't the govt provide more c wards when there is a great demand for it? why insists on having more higher and more expensive wards when people refused to pay for them?"

Because it is NOT about the bed or the room or about how many patients are in the room.

If every Singaporean thinks like you, the the KTM's prediction that the costs of B & C wards will rise and eventually become indistinguishable and people will have to apply separately to a new fund for medical subsidies will probably come true. :-(

redbean said...

hi ktm,

two points. when there is a demand for c and b2 wards, it means that either the people cannot afford the expensive fees or are wising up not to through their money away for frills.

the second point is that there will be some who can afford to pay more but would not want to pay more. and there will be some who actually cannot afford to pay more but will want to pay more. the law of averages will iron these two extremities out. to assume that this may not be the case is similar to assume that your fear that everyone will now go for c and b2 and skewed the demand for such wards.

kwayteowman said...

Redbean,

"the law of averages will iron these two extremities out"

Disagree with this claim. The assumption here is that it's 50-50 on each side.

In any case, it really doesn't matter what the reality is in terms of whether people do want to pay or cannot pay.

The real problem at hand is that the demand is fast outstripping supply and there are only two ways to deal with the problem: (i) pump in more money; and (ii) re-allocate funds.

Means testing is a sound approach to achieve (ii). If you are arguing that the Garmen must pump in more money, then please argue accordingly instead of arguing against means testing, which is a red herring in the KTM's opinion.

At the end of the day, the KTM doesn't agree that it's a matter of not being able to afford. It's just a matter of not wanting to pay more. The KTM thinks that we should just extend loan facilities for people to pay for their own medical treatments.

They can get treated first, but they pay up after. Just like study loans. At the end of the day, money doesn't grow on trees hor. If these fellas don't want to pay, then the KTM would have to pay for them through taxes. Of course, you will argue that if the KTM suay suay gets sick, he also can enjoy the same subsidy.

What you are talking about is really group insurance -- it's not necessarily efficient to foist this on people. Insurance also leads to a buffet syndrome, not like we have not seen in other countries. Eventually, this will drive up our healthcare costs.

redbean said...

hi ktm,

why is demand outstripping the supply? what is the percentage of c wards, b2, b1 and a? for a public hospital, a rough guide should be 30:30:30:10. i do not have any figure at the moment. but if the supply of c and b2 is less than 60, or if c is less than 30, than it is grossly inadequate.

it is not a case of cannot afford or do not want to pay. it is a case of providing people with a choice to feed their needs. it is a case of encouraging thrift and prudence. people must not be put in a situation when they have to spend every cent they have. it is not a crime, nor a sin, nor ungraceful, to want to eat less, sleep on planks, drink plain water, and save some money for the rainy day.

compelling people to eat in a restaurant, eat sharksfin and abalone is crazy.

what is the point of boasting about a $200 bil reserves when we cannot afford a reasonable medical care for the hardlanders or for people who do not want to throw their money away?

redbean said...

means testing is not a red herring. it is something that the rich and mighty will think is ok to shaft it down the throat of the desperate. people who think that means testing is ok are really mean. that is my view.

it shows that there is a lack of compassion and empathy for the poor fellows. to introduce means testing just to catch a few rich men who chose not to want a comfortable medicare is the real red herring.

not wanting to pay for more expensive ward is not a crime!

kwayteowman said...

You are entitled to think that the KTM is mean.

Like the GST, means testing is not the rich versus poor. Like the GST, it is the rich versus the middle class. :-)

Again, not wanting to pay more is perfectly defensible. Saying that means testing is flawed as a mechanism for reallocating resources unfortunately somewhat iffy. There's probably some truth that the actual IMPLEMENTATION of means testing might be problematic, but we have to separate the ideals from the practice.

Communism is actually not a bad idea, but it's just not something that it realistically implementable. Means testing is a completely different kettle of fish however 'cos you are not dependent on altruism. :-)

The KTM has said all he needs to say on this matter. Good day. :-P

redbean said...

hi ktm,
your idealism versus pragmatism. quite natural to believe in ideals but must be tempered with realism.

i can accept the ideal part of means testing. but i cannot see how it can be implemented. and i am against the rich and powerful imposing this on the poor buggers knowing very well that they need not be put in the same shoe.

only when they are made to face the same plight will they shut up and hide their faces. the invisible hand, or life, will give an interesting twist to events that makes conventional wisdom so comical once in a while.

the nkf is a good lesson for all. the high and mighty were brought down with a heavy dosage of embarrassment for backing what they think are good and right from their elitist perspective.

bang, suddenly all looked so foolish.