Straits Times: CPF returns: As good as it can get



SHORT-CHANGED: Mr Low Thia Khiang then asked if the Government short-changed Singaporeans on CPF interest rates.

A week after Parliament debated the CPF changes to boost the retirement income of Singaporeans, the issue of whether the new higher interest rates are fair lingers on. Lydia Lim and Jeremy Au Yong tap the experts

IT MUST have occurred to opposition MP Low Thia Khiang that a PAP MP had dropped a clanger and his job was to amplify the sound it made.

Mid-way through last week’s debate in Parliament on the CPF reforms to bump up the retirement savings of Singaporeans, MP Sin Boon Ann referred to the Government’s use of CPF monies.

“Getting funds on the cheap from the CPF” had enabled it to underwrite many development projects and social spending, he said. It was time to wean the Government off such “cheap funds”, he added, after commenting that it invested the money for much higher returns than the interest it paid CPF members.

Mr Low, the Workers’ Party chief, seized on the opening.

“Does the Government short-change Singaporeans by giving CPF members a 3.5 per cent interest rate while the GIC makes 9 per cent and pockets the balance of 5.5 per cent?” he asked.

He added: “Is the delay in the CPF draw-down age to enable the GIC to have a readily available cheap source of funds to invest?”

Manpower Minister Ng Eng Hen tried to explain that the link between GIC and CPF was “not so simple”. The Government bore all the liabilities of seeking higher returns with their attendant risks without passing them on to CPF members, he said.

A few days later, Prime Minister Lee Hsien Loong said firmly his Government did not need to rely on such cheap funds.

Who is right?

Financial experts Insight spoke to dismiss the “cheap funds” charge as spurious. The Government has no such need, they say.

Even if it does, it has cheaper ways to raise funds.

How? It can borrow money from the market either by issuing short-term treasury bills, or longer-term securities. Both are also types of government bonds.

Put in simple terms, a bond is a loan. A government bond is then a loan to the Government. It repays it with interest at the end of a certain period, say 10 years. The longer the term, the higher is the interest. Either way, bonds are deemed very low risk investments.

And when compared to returns on such bonds, CPF returns come off much better, says Citigroup economist Chua Hak Bin.

He uses the example of two- or three-year treasury bills, which he says make a fair comparison to Ordinary Account funds.

The interest rates on these currently range from 2.2 to 2.5 per cent, lower than the 2.5 to 3.5 per cent interest the Government will pay CPF members.

He does make one qualifier, however: “If the Government were to try and raise funds to the magnitude that is in CPF – I think it is over $100 billion – that would probably push interest rates up on par with CPF returns.”

As for funds in the Special, Medisave and Retirement Accounts (SMRA), MP and DBS Bank managing director Liang Eng Hwa says these are comparable to longer-term government bonds.

The new SMRA rate is pegged to the yield on 10-year Singapore Government Securities plus one percentage point.

The extra percentage point is because SMRA funds typically remain in the accounts for more than 10 years and should be treated more like 30-year bonds, which have higher yields.

But Singapore does not issue 30-year bonds.

Here again, the Government is being fair to the people, Mr Liang says.

The difference in yield between 10- and 30-year bonds issued by the United States government, for example, is only 0.3 percentage point.

Yet the Singapore Government is paying CPF members one percentage point more.

Mr Liang believes that given current market conditions, the Government is being “pretty generous”.

What the Government does is issue bonds that guarantee the rate of return promised to CPF members. Or to use the loan analogy, the Government takes a loan from the CPF that has an interest rate of 3.5 per cent on the first $20,000 in OAs and 5 per cent on the first $60,000 in SMRAs.

By doing so, the Government assumes the risks for these funds when it invests the money. CPF simply waits to collect on its loan.

This being the case, Singapore Management University Practice Associate Professor of Finance Benedict Koh says it would be a mistake to compare CPF returns to the long-term average annual returns on investments by GIC and Temasek Holdings, which are subject to risk.

“It is akin to comparing deposits in a bank with the loans of banks. Singaporeans are quite contented receiving 2 per cent interest yield on time deposits while the banks can be making 24 per cent on credit card balances or 12 per cent on unsecured personal overdrafts,” he says.

“If DBS depositors are not willing to assume the risks of DBS Bank, are CPF account holders willing to assume the risk of GIC and Temasek? Just look at the Forum letters complaining about the Shin Corp investment by Temasek. I don’t think Singaporeans can stomach such losses on their savings,” he adds.

Since paying US$3.8 billion (S$5.6 billion) for a 96 per cent stake in Thai telecoms company Shin Corp last year, Temasek has seen the value of the investment fall more than 30 per cent.

The new rate: As good as it gets?

FINANCIAL adviser Joseph Chong says that for a risk-free investment, the interest rate the Government will pay CPF members from January is so good that large insurance companies would be “swarming” to put their money with the CPF Board – if they could.

The CEO of financial advisory firm New Independent says Singaporeans who sniff at the rate are “looking a gift horse in the mouth”.

Dr Chua believes it would be “impossible” for any private institution to give the same interest rates while guaranteeing that people will not lose any money.

“Maybe it was possible five or six years ago, but long-term bond yields have come off considerably since then,” he says.

“So given that it’s risk-free, 3.5 per cent is very hard to match. It’s about fair,” he adds.

But Dr Chua thinks the Government should find ways to help CPF members with bigger balances than average earn better returns, through low-risk investing.

“Performance of GIC and Temasek does show that managed funds, by taking on some risks, can deliver substantially higher returns,” he says.

What it can do is pool together these CPF funds and help members secure the lowest possible cost of investing.

He says: “Yields can rise considerably if you are willing to take a little bit of risk. A Reit can yield 4 to 8 per cent. They do gyrate but are less volatile than usual stocks.”

A Reit or Real Estate Invesment Trust is a financial instrument that allows people to invest in real estate, while earning dividends as they do with normal shares.

As GIC and Temasek manage the country’s reserves, Prof Koh also says Singaporeans are their shareholders ultimately and hence are entitled to dividends.

“The question is how much and when? Just as a company needs to plough back its earnings to grow, Singapore needs to grow its reserves to provide stability,” he says.

But just as company shareholders get restless when they receive no dividends, he says some Singaporeans may also get impatient if they feel they do not benefit from GIC and Temasek’s investment performance.

He suggests the Government tie more closely the various payouts and top-ups it gives citizens to GIC and Temasek’s performance, “so citizens can see how they are benefitting from the high returns generated by these two organisations”.

Unlike a number of MPs who asked that the GIC invest CPF funds directly to help members earn better returns, Mr Chong says the current system where the Government tops up CPF accounts when there are Budget surpluses is more bearable for the average Singaporean.

“If GIC does well, the Government can top up our Special Accounts. Let the Government bear the risk,” he says.

While financial experts agree that the Government’s case is sound, they also note that not all Singaporeans are equally savvy about finances. And hence it is not surprising that many continue to make comparisons with what other pension funds can make, even though it would be like comparing apples with oranges. Here, the answer lies not in financial, but political management.

Weekend TODAY: The voices that also matter

Peace and prosperity is no excuse for social apathy, argue participants at forum


WITH the economy on a roll, one wonders: Have comfortable Singaporeans become blind to the inequities around them?

At a student forum on Friday that posed this question, Mrs Bridget Lew, founder-president of Home (Humanitarian organisation for Migration Economics), a migrant worker help group, clearly felt this was the case to some extent.

It was “outrageous” the way some Singaporeans treated their foreign domestic workers – the “small people in society”, she said.

Others in the 100-strong audience called for more resources to be given to help the disabled community – something that popular blogger Lee Kin Mun, better known as mrbrown, agreed with.

A father of a six-year-old autistic daughter, he wondered why “a lot of resources” have been given to help gifted students who “don’t really need as much help as those who cannot even function as a normal human being”.

He also urged individuals to speak up for what they care about, instead of relying on others to do so.

Mr Lee said that when his newspaper column was stopped last year, people had emailed him lamenting the loss of his voice to highlight their views.

“It was weird because I wanted to tell them: I’m not your voice,” said Mr Lee.

“You are responsible for speaking up for things that you care about. If (what I say) happens to jive with what you care about, then great.

“But we cannot rely on one person, one mrbrown or one politician, to speak up for you,” he added.

The role of alternative voices was a talking point during the Singapore Management University (SMU) forum on whether peace blinds Singapore to social injustices.

Student participant Liang Ye felt that certain issues are not brought up when things get comfortable.

“Apathy can also be peaceful. When you don’t seem to see anything happening, you think that everything is ok.

“When nobody voices an issue most people are aware of, then it seems that things are peaceful,” the 22-year-old told TODAY.

This was a point that Non-Constituency MP Sylvia Lim also raised, when she quoted former Federal Reserve chairman Alan Greenspan’s observations.

In his memoirs, he had said the widening gap between the rich and poor in the United States could unravel the ties binding society, and ultimately result in violence.

Ms Lim said the threat could “come from within if there are too many inequities and unfairness that leads society to such actions”.

Asked about alternative voices, she said the authorities “do listen very carefully to the things we have to say”.

“Maybe it’s mostly to rebut our points. But it doesn’t mean that they don’t take the point seriously. Perhaps they use it in their ongoing reviews of the policies.

“Over the years, we’ve noticed that certain changes in Government policies, perhaps, were raised by some Opposition parties earlier,” she added.

She further argued, it was important for the public to “hear the alternative voices” and judge for themselves which view made more sense.

While pointing out that there will “always be social injustice”, the SMU’s assistant professor of Law Eugene Tan, the forum moderator, said “each of us can do our little bit” and draw attention to concerns that may be under-represented.

TODAY: ‘Engage hearts, hold hands, assuage fears’

Minister Ng addresses MPs’ worries about CPF changes, urges them to convince people


ANY tinkering with the Central Provident Fund (CPF) system, the savings nest for Singaporeans’ golden years, was bound to be greeted with fear and uncertainty – especially if it meant resetting a system more than half a century old.

Mindful of this, Manpower Minister Ng Eng Hen, the man tasked to implement the changes, made an impassioned plea yesterday for his Parliamentary colleagues to sell the new policies to the ground.

Or, in his own words, to “engage hearts, hold hands and assuage fears”.

As he wrapped up a three-day debate involving about 40 Members of Parliament (MPs), Dr Ng was convinced the Government was making all the right moves – as far as the CPF reforms were concerned.

But “pristine policies” alone were not enough. The Government, he admitted, needed to “be better at PR to sell our policies”, as some MPs had highlighted.

He told the House: “I need you to spout poetic lines to convince your constituents that these measures are meant to help them. Spew forth with passion your Hokkien lyrics and poetic metaphors.”

To deal with the rapidly-ageing population, the Government will put in place re-employment laws by 2012. In the same year, the draw-down age for the CPF Minimum Sum will rise to hit 65 by 2018.

From next year, the interest rates for the Special, Medisave and Retirement Accounts (SMRA) will be re-pegged to the yield of 10-year Singapore Government Securities, plus an extra 1 percentage point.

The CPF Board will also administer a longevity insurance, with the details still to be worked out by a special committee.

The sweeping changes were inevitable. “There is no other way,” said Dr Ng. “We are changing the CPF because we are compelled
to, by circumstances unimaginable and unanticipated when the CPF system was started 50 years ago. A system designed in 1955 for an average life expectancy of 61, left unattended, would falter under the weight of needs as more grow old.”

But while each Singaporean will be expected to make provision for his own needs, the Government will not leave them to fend for themselves, he asserted.

A number of MPs had voiced concern over the delayed drawdown age and that Singaporeans could face hardship if re-employment failed to work.

To many Singaporeans, their CPF monies was becoming “a bit of a mirage”, charged Non-Constituency MP Sylvia Lim, who also took issue with the timing of the reforms.

The Workers’ Party chairman argued: “How can we agree to delay the drawdown age now when these details (of the re-employment laws) are up in the air? Will the new laws be just a piece of paper?”

In response, Tampines GRC MP Sin Boon Ann countered that allowing Singaporeans to draw down their CPF funds earlier would be a “disincentive” to continue working in their old age.

Pointing out that some companies were already adopting re-employment practices, Dr Ng assured Parliament that the parties involved in drafting the legislation were acutely aware that it “has to work”.

Said Dr Ng: “Some (MPs) suggested that the re-employment law be enacted well before 2012. Laws assist but there are no shortcuts. We will work on guidelines first and gauge the process.”

On some MPs’ calls for “even higher risk-free interest rates” on SMRA accounts, Dr Ng described such a demand as “too good to be true”.

Reiterating that 70 per cent of all CPF members would effectively enjoy a 3.5-percent rate on their Ordinary Account and 5 per cent on their SMRA, he said: “It is easy to claim that our investments should do better, but who dares to promise you this? No one will be willing to underwrite this system simply because it is more than fair.”

There is no risk-free asset that guarantees a 2.5-per-cent minimum return per annum, “let alone a 3.5-per-cent minimum return”, said Dr Ng. And top consultants engaged by the Government affirmed this, he added.

Nominated MP Siew Kum Hong had cited the example of Aviva’s Big e fund. But Dr Ng pointed out the firm gives the money back to the investor should the returns fall below 2.5 per cent – it does not give a guarantee.

Said Dr Ng: “For our system, there is no fine print – and that’s the bottom line.”

As for those who do not pay CPF, such as odd-job labourers, contract workers and housewives, Dr Ng pointed out that there were help schemes such as additional housing grants, Workfare and Comcare.

Under the new CPF system, 84 per cent of new entrants to the workforce would have enough to meet the Minimum Sum for retirement, even for low wage earners and “even after buying their first home”, said Dr Ng.

Praising the “high quality debate” in the House over the past three days, Dr Ng described the Government’s most pressing challenge as somewhat of a happy headache.

Said Dr Ng: “We could not have imagined 40-odd years ago when this nation was conceived, that we would be here in 2007 discussing how to deal with the problem of people living longer.”

And he was in no doubt that future generations would thank the Government of today for having the “resolve and courage to do what was necessary”.

Said Dr Ng: “How will we be judged? It is hard to be completely sure. But of this one thing I can be reasonably sure that they will conclude: that this Government did not shirk its responsibility but lived up to its duty.”

Straits Times: Sylvia Lim: Delink retirement age and CPF draw-down age



“It seems to many that a member’s CPF money is becoming a mirage: A virtual pool of water which seems just ahead, but as one approaches, is found to be far away.”

THE retirement age and the age at which Singaporeans can draw down on funds in their CPF Minimum Sum accounts should be “delinked”, Non-Constituency MP Sylvia Lim said yesterday.

Although the opposition Workers’ Party she chairs does not object to extending the retirement age even up to 67, it could not support pushing back the age at which Singaporeans can draw on their retirement funds.

CPF members can currently draw down on their Minimum Sum starting at age 62.

But with changes announced this week, the bar will be raised to age 63 in 2012, 64 in 2015, and 65 in 2018, as people are encouraged to stay longer in the workforce and build up their retirement nest egg.

Ms Lim said Singaporeans would be affected in “profound ways” by this delay.

There were those wanting to “slow down”. But the delay in accessing their Minimum Sum was akin to pressure to keep on working at the same pace as before.

A later draw-down age could also cause financial hardship for those affected.

She argued that although the goal is to increase the employment rate among those aged 55 to 64, there was no certainty someone could keep a job – even with a re-employment law in place by 2012.

And even if they had work, she said it was likely they would earn less – and might not have enough to cover their expenses.

Many also suffered a cash crunch from age 55 onwards: With lower CPF contribution rates, they would take longer to build up savings. And having to set aside larger amounts in their Minimum Sum and Medisave, meant they have less they can withdraw at age 55:

“It seems to many that a member’s CPF money is becoming a mirage: A virtual pool of water which seems just ahead, but as one approaches, is found to be far away.”

One way to avoid a later draw-down on CPF funds would be for the Government to boost returns on CPF savings, so people would have more for retirement, she said.

Also, government coffers had grown, she said, citing how the taxman’s collection rose by more than $6 billion last year compared to five years ago.

Ms Lim’s call for allowing workers to draw on their retirement savings was criticised later by Mr Sin Boon Ann (Tampines GRC).

He said she had not addressed a fundamental issue: That if people drew on their CPF funds early, would they have enough to see them through their retirement.

He added: “How can she be sure that if there’s an opportunity for Singaporeans to draw down earlier, (they) will continue to want to work to ensure that there is sufficient income to meet their daily needs?”

Mr Low Thia Khiang (Hougang), who is Workers’ Party secretary-general, rose later and asked if Mr Sin was suggesting Singaporeans were lazy and would not work if they received their CPF funds – and the Government thus needed to hold on to their money.

Mr Sin countered that Mr Low was being “disingenuous” by for putting words in his mouth. He never said Singaporeans are lazy.

His said the point he was making was that early access to CPF funds could be a “disincentive” for Singaporeans to work actively.

Straits Times: Longevity insurance an irresponsible act, says Low



OPPOSING VIEWS: MPs Low Thia Khiang and Chiam See Tong (next picture) challenged the CPF policy changes.

THE two opposition MPs yesterday called on the Government to do more for older Singaporeans.

Mr Low Thia Khiang (Hougang) asked for the setting up of a longevity fund to help provide for the elderly. He added that he fears the CPF policy changes may cause Singaporeans to perceive the old as useless, leading to the erosion of social cohesion.

Mr Chiam See Tong (Potong Pasir) also argued that the Government should contribute to the annuities scheme, echoing earlier calls by ruling party MPs Inderjit Singh and Josephine Teo.

In an impassioned speech made in Mandarin, Mr Low, secretary-general of the Workers’ Party, said in a droll manner that “the world is becoming a funnier and funnier place”.

It is one where “longevity has become a crime”, he said. “Singaporeans have worked so hard all their lives, they have contributed to the economy. Much credit must be given to them. But now if people live a long life and their CPF is exhausted…the Government wants to force them to buy annuities.

“I think this is an irresponsible act on the part of the Government,” he charged.

What should be done instead is to set up a longevity fund that will make payouts to those who live beyond 85 and are in financial difficulties, he said.

Mr Low went on to say that, for people to identify with their nation, “policies should not be formulated based on data and economic consideration alone”.

But his suggestion of a longevity fund was rejected by Second Finance Minister Tharman Shanmugaratnam.

“It will not be wise for the Government to do this or for Singaporeans to want the Government to do this,” he said.

“We know that these pressures will build up over time for Government to spend more, to grant more, to subsidise more. It’s in the nature of every society and every society, especially as it gets older.”

It was in anticipation of this that the elected presidency system was put in place, said the minister. “It is a system that makes sure that subsidies are paid for and funded on the Budget now, one way or another, not left to future generations to pay.

“This is the way we must run the Government. There is no easy way out.”

In his speech, Mr Low also stated his party’s opposition to the deferment of the age at which Singaporeans can withdraw their CPF savings.

While Singaporeans may be living longer, they may not necessarily be healthy enough to continue working, he said.

And delaying the use of CPF monies means that they are deprived of a chance to decide if they want a lighter job with less income.

“If we do not allow our people to start drawing down on their retirement account at the age of 62, it will result in Singaporeans having to work until they are old or even until they are dead,” he said.

This met with a rejoinder from People’s Action Party MP Cynthia Phua (Aljunied GRC), who accused the Workers’ Party of playing to the gallery. “(They) refuse to face the reality and are not prepared even to take and to shoulder the responsibility.”

Meanwhile, Mr Chiam called for the Government to manage the annuities scheme itself rather than farming it out to a private insurance company. This way, it could “top up the annuity accounts of poor citizens itself and not wait for the government surpluses to do so”.

He urged that the CPF system be “made simple and more transparent so it can be easily understood by the workers”.

Weekend TODAY: 50 years on … what keeps Workers’ Party going



HALF a century is a long time in politics. Very long if that is opposition politics. And an eternity if the politics happens to be in a country where the ruling party has been in power for 48 uninterrupted years, delivering an economic miracle and breathing life into nearly every corner of the physical, social, economic and political environment and fighting its rivals tooth and nail.

Then, how did the Workers’ Party (WP) – put together by a pipe-smoking criminal lawyer called David Marshall on Nov 7, 1957, to promote workers’ welfare – manage not just to survive but keep its parliamentary presence for a very long 26 years?

The answer may rest in the fact that in nearly every election, about a third of voters do not support the ruling People’s Action Party (PAP), said Dr Terence Chong from the Institute of Southeast Asian Studies (Iseas). “Opposition parties have survived on the votes of this 30 to 40 per cent of Singaporeans,” he added.

The permanent anti-PAP bloc aside, the WP has also been kept alive by the presence of leaders who were able to provide the party and its supporters with what was needed at that time.

Mr Marshall was an idealist who thought there was room for another party amid a highly-charged political landscape. The next WP leader, Mr J B Jeyaretnam, threw in his lot with confrontational politics at a time when the political scene was bereft of opposition politicians who exhibited a sense of bravado to take on the PAP heavyweights.

And now there is Mr Low Thia Khiang, who is a major departure from his predecessors with his non-confrontational style. He prefers to let his grassroots walking do all the talking – a strategy that has gone down well with his constituents voting for him in four successive elections, the last one with an increased majority.

In the late 1950s, Mr Marshall, who had quit the Labour Front, discovered that there was a niche to be carved between the two extremes of the political spectrum – the left-wing PAP and the right-wing Labour Front government. And the quickest way to do that was through the communist-infested trade unions. Thus, the WP was born.

Despite a bright start that saw the party winning four of five seats it contested in the City Council Elections, the WP lost support dramatically once the communists threw their support behind the PAP. As political historian Hussin Mutalib notes in his book Parties and Politics, Mr Marshall’s centrist stance failed to woo the populace, “at a time when the agitative political climate was looking for more radical leaders”.

Mr Marshall was to go on to win the Anson seat in 1961 but, two years later, he was forced out of the WP after the party disagreed with his “all-or-nothing” position on the merger with Malaysia. Mr Marshall had wanted Singapore to either seek a complete merger with Malaysia or seek its own independence.

Divided and shorn of its most prominent face, the WP went into disarray and Mr Marshall was trounced at the 1963 elections in which he stood as an independent candidate.

The party remained rudderless until 1971, when a flamboyant former District Judge by the name of Joshua Benjamin Jeyaretnam brought with him a group of English-educated professionals into WP’s fold.

Armed with a 14-point manifesto that sought to “amend and repeal” some of the PAP’s policies, the WP under JBJ – as he came to be known – was cheered from the fringes but failed to grab any parliamentary seats in an election just months after the leadership change.

The party tried to make an impression in the 1976 elections with its platform of “Towards a Caring Society”. The campaign saw JBJ winning the highest percentage (40 per cent) of votes for an opposition politician but it was not enough to win him a ticket to Parliament.

JBJ was not to be denied five years later, when he won the Anson by-election, breaking the PAP’s 15-year-old monopoly in the chamber.

He wrote a boisterous chapter in WP history during his term in Parliament when he made his presence felt, frequently engaging senior Cabinet Ministers, including Mr Lee Kuan Yew, in fiery debates.

But while his term in Parliament kept him in the limelight, his confrontational approach towards the Government led to his downfall.

Mr Jeyaretnam was forced to relinquish his Anson seat in 1986, when he was found guilty of false declarations of the WP’s accounts – a conviction the Privy Council in Britain overturned but which was upheld here.

Still, he led a one-man crusade against the PAP. By roping in outspoken individuals who had an axe to grind, including former Solicitor-General Francis Seow, Mr Jufrie Mahmood and Mr Tang Liang Hong, the party established itself as the biggest – if not the loudest – opposition voice.

The exception was Mr Low Thia Khiang. Mr Jeyaretnam might rue the day he brought Mr Low into the party, since this set in motion a renewal process that indirectly led to his exit as WP leader.

Mr Jeyaretnam, who handed the reins to Mr Low in 2001, was bankrupted by defamation lawsuits while Mr Seow and Mr Tang fled Singapore.

Dr Hussin, in his book that was first published in 2003, argues the WP was often let down by the poor quality of its election candidates and its “spray-gun” approach against PAP policies. One exception was the WP’s call for a “caring society” in the 1980s, which offered Singaporeans an alternative policy.

But even this platform was somewhat usurped by the PAP Government when then-Prime Minister Goh Chok Tong took the reins in 1990 and unveiled a vision for a “gracious society”.

If Mr Jeyaretnam, with all his passion and fearless attitude, could not take the WP to greater heights, many doubted if the mild-mannered, Teochew-speaking Mr Low could take it anywhere at all.

After six years at the helm, Mr Low has proven his critics wrong. One need only look at last year’s General Election to see how far Mr Low has helped to revive the WP’s fortunes. Even the presence of Senior Minister Goh Chok Tong during the Hougang hustings in support of the PAP candidate and the dangling of juicy carrots before voters could not swing the votes against Mr Low.

Mr Low’s restrained ways have reshaped the WP brand – moving it away from firebrand politics and, consequently, unnecessary and costly legal battles. His stoic approach to the PAP’s attacks also won him fans.

While observers, such as Iseas’ Dr Chong, have no doubt the WP, under Mr Low, is the strongest opposition party today, the key questions many are asking as the party celebrates its 50th birthday in November are: Where can it go from here?

The PAP – like any other ruling political party – cannot be expected to make life easier for the WP. For some observers, the WP may find succour in something beyond PAP’s control – the forces of globalisation.

Dr Chong said: “As Singapore becomes more open, will there be a gradual resistance to globalisation among Singaporeans? Will the WP be able to take advantage of the inequalities and side-effects it brings?”

Even in this area, the PAP is unlikely to concede space with the Government already taking the high ground by introducing measures such as Workfare to provide relief to lower-income Singaporeans.

While the odds are stacked against the WP’s efforts to make a major impact on national policies, there are signs the party have started to adopt an approach that may seem modest at first glance but could pay big dividends eventually. And that is its strategy of “going local”.

That means working the ground – Mr Low reportedly attends as many funerals as he can in Hougang – and convincing the constituents that its members can do as good a job, if not better than, their PAP counterparts in running an estate and helping them solve their municipal problems through non-governmental means. But the biggest hurdle the WP faces is a ruling party that is likely to be tenacious in defending its ground vigorously. Still, as the hardline Old Guard exit the political stage, how the successive generations of leaders – brought up in an entirely different era – deal with the opposition will play a part in the latter’s durability.

Like everything else in Singapore, it’s results that matter. So, like JBJ’s victory in 1981, securing the party’s survival for another 50 years might hinge on the party winning a Group Representation Constituency.