TODAY: Some MPs still questioning GST hike

Concerns over whether Govt can afford Workfare


EVEN as they lauded the Government’s “historic” move to boost the income of low-wage workers through a permanent Workfare scheme, some Members of Parliament were still unconvinced over the need to raise the Goods and Services Tax (GST).

Noting that the Workfare Income Supplement (WIS) scheme would cost the Government some $400 million each year, Opposition MP Low Thia Khiang said it should be able to afford this even if it did not increase GST by 2 percentage points to 7 per cent.

Suggesting that the Government’s coffers would be boosted substantially when the integrated resorts are up and running by 2009, Mr Low said: “By citing the rationale to help the needy as a reason to raise the GST, the Government is merely hitching a free ride. Similar handouts to the GST offset package have been given out in the past. The Budget last year, before the elections, is a good example. Even if the Budget was in the red, it didn’t need to raise GST nor tap into the reserves.”

Ang Mo Kio GRC MP Inderjit Singh called on the Government to dip into the reserves – rather than depend on GST revenue – to fund the country’s growth.

Said Mr Singh: “Should we just depend on GST to fund these (expenditures)? If so, I can see GST going up to 15 per cent in the next 10 years. Is it fair then to shift and continue to shift the burden of paying for these investments onto the man in the street who pays the GST?”

In tandem with the increase in GST, the Government had also reduced corporate tax by 2 percentage points to 18 per cent. Such a move, it said, would increase Singapore’s competitiveness.

However, some MPs questioned if this would necessarily give Singapore a competitive advantage over Hong Kong, which plans to reduce its already low corporate tax rate.

Nominated MP and lawyer Siew Kum Hong cautioned the Government against engaging in “a race to the bottom”, citing the fact that Hong Kong need not worry about its defence expenditure.

Said Mr Siew: “Just as we have long ago decided that our economy cannot compete on the basis of low costs, we also cannot keep competing on the basis of low tax rates. We will need to sell Singapore on our other strengths as well.”

Straits Times: Low Thia Khiang praises Workfare, slams GST hike


OPPOSITION MP Low Thia Khiang (Hougang) did the unexpected in Parliament yesterday. He supported a government policy.

He praised its decision to make Workfare, an income supplement for older low-wage workers, a permanent scheme.

But true to his credentials, he trained his fire on another government move: the hike in the goods and services tax (GST).

Accusing the Government of fleecing the people, he dismissed its reasoning that the hike could pay for more help schemes and make Singapore competitive. There was no need for the hike, he said. The nub of his argument: the Government had enough in its coffers to help the low-wage workers.

He also questioned the timing, as the hike was being effected soon after last year’s General Election. ‘The first step you have taken is to hurriedly…increase GST and at the same time, raise the banner of helping the poor.

“I’d like to point out whether the Government is fleecing the people,” he said in Mandarin.

Mr Low began his speech by giving kudos to Workfare: “This permanent feature to help the lower-income as a part of our safety net scheme has my support. It will help to reduce the income gap with globalisation and help them to meet the cost of living.”

Still, he wondered why workers, especially those with irregular incomes, had to contribute to the Medisave account before they could receive any Workfare. “(This) is not so attractive and in some way shows a lack of sincerity of the Government,” he said.

Turning his sights then on the GST hike, he said the Government’s suggestion that the extra funds raised could be used for help schemes for the needy was a “convenient excuse”.

“I believe that for this Workfare income scheme, even without an increase of GST, the Government should be able to afford it,” he said.

After all, low-wage workers had always been receiving help, such as the cash handouts and rebates in last year’s Progress Package.

Then, there was the GST offset package to cushion its impact. But it would not need to spend on such offsets if it did not raise the GST, he argued. It was also “not clear” how raising GST would give Singapore an economic advantage.

As it was, Singapore’s strong economic performance meant more funds could be reaped from corporate tax, he said. And he had read that the GST could be a turn-off for companies, he added.

He also felt that with two casinos due to open here, the Government would get “an endless and constant stream of income”.

The People’s Action Party (PAP) side was quick to return fire, as the next speaker, Mr Hri Kumar (Bishan-Toa Payoh GRC), chastised Mr Low for asking for fiscal policy to be based on such “speculative future income”.

“Mr Low is getting a head start because he is truly gambling with our future,” he said.

On Mr Low’s point that lower corporate tax alone would not attract businesses here, the PAP MP said that this was not the only strategy involved. Mr Low, he said, had ignored the other measures, such as the investment in infrastructure, and upgrading workers’ skills. “These require spending by the Government,” said Mr Kumar.

On Mr Low’s point that there was no need to raise GST during good times, he dismissed it as “illogical”, as it implied that taxes should be raised when the economy was plummeting.

Channel NewsAsia: Low Thia Khiang welcomes Workfare but questions govt’s sincerity

By Julia Ng

SINGAPORE: Opposition MP Low Thia Khiang has welcomed the Workfare Income Supplement (WIS) scheme, saying it will be another pillar in Singapore’s social safety net.

But he rejected tying it to CPF contributions as this means some odd job workers may be left out of the scheme.

Mr Low, who spoke in Mandarin during Tuesday’s debate on the Budget Statement, said this requirement showed a lack of sincerity on the Government’s part in helping low-income workers.

He also questioned the need to raise the GST by 2 percentage points and the advantage of cutting corporate tax by just 2 percentage points.

Speaking after Mr Low, MP for Bishan-Toa Payoh GRC Hri Kumar rebutted Mr Low’s criticisms, especially on the timing of the GST hike and the amount of corporate tax cut.

Mr Hri said that it was illogical to wait until the economy is not doing well before raising the taxes.

Mr Hri went on to say: “Mr Low said that the corporate tax reduction is not sufficient to attract business. Well, I agree that if that’s all we’re relying on, then that’s not a good thing. But we’re not relying solely on the corporate tax reduction. There’s a whole slew of measures and which is why we need to invest in our infrastructure, which is why we need to invest in our people and upgrade their skills so that we can attract businesses to come to Singapore.”

On Mr Low’s criticism against the Medisave-Workfare linkage, MP Halimah Yacob said: “The decision to link WIS to Medisave is a crucial and important one. Unlike Mr Low who thinks it shows the insincerity on the government’s part, I think that on the contrary this shows how much concern the government has on the plight of the low income and casual workers.”

Recounting the hardships faced by workers without Medisave or CPF, she added: “We spoke to many of them in the cleaning industry, the construction sector, in the other services sector. Their sense of insecurity and fear is real. Why are the casual workers so concerned about falling ill, retiring from work, or if they are the sole breadwinner, if they were to die leaving behind their dependants? The reason is very simple – in Singapore, housing, health and retirement are all tied to the CPF.” – CNA/ir

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Sunday Times: WP asks Govt to explain Penal Code amendments

It wants Government to justify why it is necessary to increase maximum jail terms by three times or four times

Zakir Hussain

THE Workers’ Party wants the Government to justify its proposals to increase maximum jail terms for certain offences.

The proposals, part of amendments to the Penal Code, are expected to be tabled in Parliament in the first half of this year.

WP chairman Sylvia Lim made the call yesterday at a public forum. The party’s views will be presented to the Home Affairs Ministry.

“Since the Government says it has not increased imprisonment terms unnecessarily, we must ask the Government why it is necessary to increase the maximum jail terms by three times or four times,” said Ms Lim, a Non-Constituency MP.

The proposals, announced in November, are the first major review of the Penal Code since 1984 and aim to bring the law in line with the times.

Ms Lim said changes had to be justified “to convince us that imprisonment terms are not increased unnecessarily”.

A polytechnic law lecturer, she cited two examples:

Twenty years for assaulting an MP with the intention of preventing him from doing his job, up from seven years now.

Two years for being part of an unlawful assembly, up from the current six months. The changes here are significant, she said, as this is coupled with a broadened definition of what constitutes unlawful assembly.

She said that guest panellist and lawyer Thomas Koshy told her that one danger of having much higher jail terms is that people who are charged may be pressured into pleading guilty.

“As we know, people who claim trial get higher sentences than those who plead guilty. Faced with a high maximum jail term, some will not be willing to take that risk,” Ms Lim asserted.

Mr Koshy, Ms Lim and two other panellists spoke at the two-hour forum at the WP’s Syed Alwi Road headquarters.

The forum was the first in a series of events to mark the WP’s 50th anniversary this year.

It was attended by 60 people. They included WP members and supporters, students and activists, among others.

The other panellists were WP youth wing council member Firuz Khan; and another guest, consultant therapist Anthony Yeo.

Another proposal Ms Lim cited was changes allowing judges to hand down sentences that can be a combination of a jail term, a fine and caning. Currently, they can sentence an offender only to two out of the three possible punishments.

But Ms Lim had no quarrel with plans to increase fines for offences by three or five times, noting that many fines were set in 1952.

She also saw the removal of some mandatory minimum sentences as a good thing, and welcomed moves to prosecute Singaporean child sex tourists.

The question-and-answer later also touched on the continued criminalisation of gay sex and the party’s stand on it.

Ms Lim said the WP would not dispute this law being on the books. Party leaders discussed the issue extensively but were divided on it.

Nominated MP Siew Kum Hong, who attended the forum, felt more people should take an interest in these proposed changes: “I wish there were more such forums like these, organised by anyone, to raise public awareness.”

Playwright Ng Yi-Sheng, 26, agreed: “People want to hear new ideas and proposals, but I felt there was a shortage of suggestions raised today.”

Straits Times: WP forms ‘action plan’ to attract more Malays

Leaders see lack of support from Malays as key reason for Aljunied GRC defeat


THE Workers’ Party (WP) is rolling out its post-election plans to attract more Malay members and reach out to the community, starting with the young.

Four Malays now sit on the 12-member council of the party’s youth wing, compared to none when the youth wing was formed in 2005.

“There are steps being taken to cultivate Malay party members,” said WP vice-chairman Mohammed Rahizan Yaacob, declining to reveal more details.

The Straits Times understands that there is a “Malay action plan”, and early indications of the type of outreach activities the party is keen on.

During the fasting month last October, for example, WP members went door to door in the private residential area of Opera Estate, which has a significant Malay population, to collect traditional Malay outfits, or baju kurung.

Youth wing members then distributed the clothes to the Pertapis Children’s Home in time for Hari Raya Aidilfitri.

The party’s interest in the Malay community was sparked by its post-mortem of how it fared in last year’s general election. The WP leaders felt that a lack of support from the Malays was a key reason for its defeat in the closely watched Aljunied GRC then.

Party secretary-general and Hougang MP Low Thia Khiang said then that the party had to work harder to get candidates from minority communities if it wanted to improve on its showing in the GRCs.

Since then, “a fair number of minority members have joined”, said party chairman and Non-Constituency MP Sylvia Lim.

Three members elected to the youth wing’s council at its conference in August were:

>> Mr Abdul Salim Harun, 25, a sales officer. He was a WP candidate in Ang Mo Kio GRC last year and is the youngest member of the WP executive council.

>> Mr Muhammad Noor, 29, who runs his own business dealing with health-care and ambulance services.

>> Mr Muhammad Faisal Abdul Manap, 31, a counsellor with a voluntary welfare organisation. The former technical officer with the HDB is a psychology graduate from Monash University.

>> The fourth, Mr Firuz Khan, 40, was co-opted to the youth wing’s council in November. The general manager of chocolate company Royce’ in Singapore has a master’s degree in business administration from the University of Birmingham and is a former administrator of the Pertapis Children’s Home.

Asked why he joined the WP, he said: “It’s healthy to have diverse, alternative views on issues, and I thought I could contribute.”

Mr Firuz will be speaking at a forum today, organised by the WP at its headquarters, on the proposed amendments to the Penal Code.

Said Ms Lim: “We recognise the need for WP to represent Singapore as a whole and to be in touch with concerns and sentiments across all communities.”

Added deputy webmaster and youth wing secretary Glenda Han, 30: “We look across the board for people. I don’t think we make a distinction, although we’ll be happy if more minorities join us.”