3/03/2012

The Singapore People’s Subsidy (SPS)

Has anyone heard of this SPS? The people have been bombarded with govt subsidies everyday that they are either going bonkers or numbed. If you read the number of subsidies that the govt is giving to the Singaporeans, the govt will be bankrupt long time ago. The latest is something like $60k for a 2rm flat that costs $90k. Wow, wow, how can be so much. Where is the money coming from? There university fees, $20k but pays $6k, and what else…? I am also thinking of giving subsidies to the people, cheap rice at $20 per kilo. My cost is $100. Please queue up.

Not to be distracted, what is this SPS? This is the Singapore People’s Subsidy to the Govt in the tune of hundreds of billions. The Govt calls it national reserves. Should it be called the people’s money or savings? How does this money become the national reserves? Or are they really two different things?

Have the citizens been subsidising the Govt in the tune of hundreds of billions through the CPF? Maybe not. Dunno where the CPF money is or with who. I have read that the two national sovereign funds did not borrow from the CPF. They something like borrowed from dunno where. But somewhere somehow, they got the money. Anyway, the Govt has a lot of money to set up big investment funds to pay huge salaries to big time investment managers to invest the money and make more money to pay themselves in big bonuses. How I wish I can be appointed as a director, no need to be Chairman.

Is there any linkage between the money of the two sovereign funds and the CPF money or the people’s money? If there is…, something like A lends to B and B lends to C and C lends to D, so legally, technically, D only borrows from C and got nothing to do with A. So A cannot claim that his money is now subsidising D.

But where is A’s money if it is not subsidising someone? And what is A getting in return? 2.5% or 4% interests that could easily be wiped out by inflation. Further, A cannot touch the money for a very very long time. Some may never in their lives.

This is the Singapore People’s Subsidy to the Govt. And this is real money, no mark up to mark down. Maybe I am wrong. Where got the people subsidising the Govt? I am talking rubbish.

16 comments:

Anonymous said...

Rubbery Accounting:
1. HDB flat subsidised to a tune of $bln annually....rubber land & infrastructure costing.
2. Education subsidies to a tune of $bln annually....still can afford to subsidize so many not so talented FTs.
3. Public transport subsidies of all sorts to young, old, etc...still raking in huge profits annually and paying high dividends to shareholders...never had a down year, very very strange in stocks profits' history.
4. Top public servants working for discounts....yet renumerations highest in the world.
5. Th & Gic making new high in asset under management...yet making so many big losses on investments...
On and on......
New World Accounting Standards Set. Opaque is indeed dark.

Anonymous said...

Thank you Mr Chua!

Looks like you are going to be official people's spokeman about the CPF con game! Which I hope you would!

I agree with you. We are subsidising GIC and Temasek. Our govt is not being honest. CPF is cheap funding for Temasek/GIC.

This is the govt story to us -
1) Ministry of finances (MOF) pays us 2.5%/4%
2) GIC/Temasek issues bonds to MOF and pays XX%
3) MOF use GIC/Temasek bond money to pay us

Your CPF money is thus safe and underpinned by bonds.Case closed.

What is the big white elephant in the room that the govt does not say -
1) GIC/Temasek makes 8 - 10% returns annually (dont know the exact number)? Profit margin of 6% (assume 10% - 4% CPF rate)

2) GIC/Temasek makes 6% profit, keeps it all, pays themselves fat bonus, bail themselves out of trouble and claim they are building national reserves.

Conclusion - why give MOF our CPF money?? Why not give direct to GIC/Temasek and CUT OUT THE MIDDLEMAN!!!!!!

We citizens are not daft to creative accounting.

Anonymous said...

Sorry one more thing to add to my post at 11;17am.

Despite all the nonsense going on.... I think the biggest insult of all is the way we are treated by the govt.

All these systems basically tell us that we singaporeans are a bunch of idiots.

I (govt) tell you how much to budget for retirement, I tell you how to invest, I will also tell you how spend you money (CPF life).

I know everything and control you as you on your own are too stupid to manage yourself.

This is the message I am getting. Was wondering whether I the only one?

Anonymous said...

Can be term as Legalized forced subsidy?

Veritas said...

PAP strike lottery ar? So much $$$ to subsidize here and there?

Its all out money boy.

patriot said...

Redbean Sir;

You MUST let me have a million the next time we meet.
And me will HELP You with 200Ks with whatever You do after that.

Can?

Matilah_Singapura said...

Singapore's Sovereign Debt is 95% of GDP...around $250 + billion US Dollars.

There is no "danger" because no foreigners hold that debt. That debt is essentially "secured" by the money in CPF -- through the rubbery accounting (@anon 1100) mechanisms of funding of govt entities GIC, and the Sovereign "Wealth" fund -- Temasek.

On the plus side: All the debt is held by Singaporeans and Singapore entities, therefore no "foreigner" can use the debt as "leverage" against Singapore.

On the minus side: There is no money in CPF to be "returned" to you -- it is all used to secure debt and fund the state's "privatised" corporate enterprises.

i.e. even if the govt had a big ol' soft heart (hahahaha...), it could NOT pay CPF out to anyone as that would cause an instant collapse of funding, and the sovereign debt would have to be secured by "outsiders" or face total collapse.

CPF is a tax. The money ou paid is a sunken cost -- i.e. throwing good resources at it to "recover" a lost value are futile, emotion-driven neuroses.

Anonymous said...

Who is the creditor and who is the debtor here? The govt owes the people money and acting as the master deciding what it wants to do with the money, deciding how much more it wants to demand from the creditor and deciding when and how it wants to pay back or not to pay back.

What a fantastic debtor creditor relationship. The creditor at the mercy of the debtor and begging the debtor for handouts and mercy.

Anonymous said...

When government talents "subsidize" the citizens, it's helping the ungrateful, welfare minded daft Sinkies.

When citizens subsidize the government so as to make the government talents look good, it's called national service.
The talents get a pay rise.
And we don't get to see our CPF money anymore.

Anonymous said...

"What a fantastic debtor creditor relationship. The creditor at the mercy of the debtor and begging the debtor for handouts and mercy."

There is an old joke.

When you owe the bank $1 million dollars, you are at the mercy of the bank.

When you owe the bank $1 billion dollars, the bank is at your mercy.

So how much does the government owes us?
Millions or billions?

Anonymous said...

The President safeguards our Reserves but does that include our CPF? If it includes our CPF, does that mean that there is not enough there now, when he has to give a 50% discount for his talented service?

Anonymous said...

Personally. I prefer to have a strong Opposition party in parliament to safeguard our reserves.

Opposition parties in all parliamentary democracies serve this role.

Matilah_Singapura said...

Fuck political democracy. Bring in MARKET democracy.

Singapore is a republic. I prefer limited government. Sell parliament house to a private developer like Far East -- they do excellent work.

Singapore is a small city state. The govt should be able to fit in about 3 floors of a modern office building.

No bigger govt than that is required to manage a small island city state.

Drop GST back to 3%. Zero income tax. 10% corporate tax. That's more than enough money to fund a small well-paid govt. (I support high pay for ministers, so fuck you all)

patriot said...

Me concurs fully with
Matilah Singapura.

Certainly no need for a director, two assistant directors, a general manager and ten other lower ranking staff to run a 'char quay tiao' stall.

A district bigger than Singapore in other countries is probably taken care of by a district headman.

patriot

Anonymous said...

Why is Employees Provident Fund, Malaysia, able to pay so much higher interest to their citizens than CPF ??? Last year's interest for EPF was 6% ? Should compare the past many years of interest paid by EPF/CPF & ask govt to explain why with world class scholars CPF members are paid such meagre returns

Chua Chin Leng aka redbean said...

They can pay 6% because they cannot afford to pay highly qualified professionals to manage their funds. You need to pay a lot for super talents.