PAP's Undeclared War

Singapore's rich splash out with a vengeance

2007-04-24T23:30:00.000-07:00

SINGAPORE, April 25 (Reuters) - Celebrity-chef dinners, huge pay hikes, and hot properties with a garage for the Ferrari and a berth for the yacht...some people in Singapore are living it up.

The world's top banks have set up in the city-state, bringing plenty of rich clients in their wake. Now, thanks to a strong economy, a private banking boom, and the prospect of two glitzy casinos opening soon, the big spenders are out in force.

"The good times are back," said Roman Scott, a financial consultant. "There's been a sudden turnaround in confidence. Suddenly, people notice that the economy is growing, they find they can't hire a secretary, and housing prices are going up."

Singapore's immaculately groomed private bankers are having a field day, thanks to the government's policy of creating a one-stop banking centre-cum-playground for the affluent.

The focus on the rich has even spawned a new caste system -- of "high net worth individuals", or those with a mere million in financial assets, and the highly desirable "ultra-high net worth" who have millions or billions of dollars to their name.

Take Charoen Sirivadhanabhakdi, Thailand's richest man, according to Forbes, who listed his whisky and beer firm Thai Beverage in Singapore last year.

He snapped up not just one, but 47 out of 48 flats in a new development for S$205 million, and four entire floors in another project for S$135 million, Business Times reported this month.

Singapore has more millionaire households as a percentage of total households than any other Asian economy, according to the Boston Consulting Group.

Now thanks to all the wealthy Chinese, Indonesians, Indians and Thais who turn to Singapore -- not to mention the Europeans who prefer to park their funds offshore -- there aren't enough private bankers to handle all this money.

Whole teams of "wealth managers" are hopping from one bank to another, lured by promises of ever-higher salaries and payouts.

"There's a shortage of really high quality bankers, so there's poaching and that pushes salaries up," said Chris Claridge, who runs a head-hunting firm.

"Most players are getting 20-30 percent more. One guy, an investment banker, ended up with 75 percent more because two banks were bidding for him. It was like ebay."

CELEBRITY CHEFS AND BUTLER SERVICES

Bankers aren't the only ones getting a big pay rise.

Singapore's ministers, already among the world's highest-paid, just got a 60 percent pay hike, lifting their salaries from S$1.2 million to S$1.9 million ($1.26 million) on average.

The Prime Minister's pay jumped to S$3.5 million ($2.3 million) -- more than five times the U.S. president's $400,000 salary -- while his deputies will each get S$2.45 million. Two former prime ministers who retain cabinet posts will be paid more than S$3 million.

A few weeks earlier, the government said it would address a widening income gap with benefits for the poor. The bottom 10 percent of households had an average annual income of S$3,600 per member in 2006, up 6.6 percent from the previous year.

Ministers and civil servants are benchmarked against the best-paid individuals in professions such as banking, an area the government is encouraging as part of an economic overhaul.

Given the wealth in the financial sector, it's no surprise people are splashing out on expensive meals, cars, and homes.

Indonesian tycoon Oei Hong Leong hosted a S$50,000 charity banquet, flying in celebrity chefs Tetsuya Wakuda and Justin Quek for a 16-course meal that included poached foie gras and steamed tofu, as well as rare vintage wines, the Business Times reported.

Local media this month profiled a local businessman whose fleet of 20 cars includes Bentleys, a Lamborghini, a Ferrari and a Jaguar, and said that one Singaporean had paid S$3 million for a new Pagani Zonda F, a record for a sports car in the country.

Even Singapore's long-stagnant property market is getting a welcome shot in the arm, at least at the top end.

Such gains could start to erode Singapore's competitive advantage for international firms when compared with centres such as Shanghai, Hong Kong, or Tokyo, some analysts warn, while adding to the city-state's inflationary pressures.

Prices for new apartments in prime districts surged 25 percent in 2006, the strongest recovery in years, while landlords are demanding rent increases of 50-60 percent.

"The rental market has gone through the roof," said property agent Bee Bee Tan, with a central flat that rented for S$3,600 now commanding S$6,000 a month, an increase of 67 percent.

As for the millionaires, they can take their pick of projects offering butler services or a doorstep berth for that gin palace.

"It's Monaco in the tropics," said consultant Scott.

In Singapore, a local Switzerland for Asia's wealthy

2007-04-24T23:28:00.000-07:00

By Wayne Arnold
Published: April 24, 2007

SINGAPORE: This affluent city-state of 4.5 million people is aiming to become a sanctuary for the world's wealthy and their money, Asia's answer to Geneva and Zurich.

Singapore, with its reputation for authoritarian order and safety, has long relied on luring multinational corporations for manufacturing jobs and economic growth. But with China's rise as an industrial powerhouse, it started chasing a succession of economic fads - from technology to pharmaceuticals to stem cell research - in search of a fresh elixir.

Now Singapore, is trying to carve out a new niche for itself in the global economy by beefing up banking secrecy laws and offering generous tax incentives.

Almost 40 private banks now have regional operations here, including Swiss stalwarts like Bank Julius Baer. Citigroup's headquarters for all private banking outside the United States is now in Singapore, as is the global banking headquarters of Standard Chartered Bank of Britain.

"I can't think of any other place where private banking is growing so much as in Singapore," said Henrik Mikkelsen, a private banker at Commerzbank in Singapore. "We want to be the Switzerland of Asia."

It may not have the stunning Alpine scenery, but officials here hope that luring the wealthy and their bankers will not only diversify the economy but also help to offset a declining birthrate and increase the island's stagnant population with what is known here as "foreign talent."

"It creates jobs, it builds a service industry, it generates income and, on the immigration issue, it also supplements our shortfall in fertility," said Vivian Balakrishnan, Singapore's minister for community development, youth and sports.

The estimated $150 billion in private wealth the banks manage here is still just a sliver of the $1.7 trillion managed by bankers in Switzerland. But by all accounts it is growing quickly, fed by new wealth pouring in from Asia's fast-growing economies, Middle Eastern oil money, and Japanese and Europeans fleeing new efforts to tax their offshore earnings.

The bankers cater to people like Robert Chandran, who emigrated to the United States from India and made fortunes in California real estate and the fuel oil business. In 2005, contemplating retirement, he moved his company and family to Singapore, bought a luxury condominium downtown and space in a waterfront resort with berthing for yachts. He traded in his American passport for one from Singapore.

Chandran said he was lured by Singapore's blend of Western conveniences with Asian values and by the government's zeal for keeping Singapore competitive.

"They don't have global taxation," he said, which means that his capital gains and interest income from outside Singapore are not taxed here.

Singapore's vision for the high-life can be found at Sentosa Cove, a secluded development on the edge of a small island theme park off Singapore's coast. Chandran is building his home there, among sites that sold for as much as $9.9 million each. Sentosa Cove has a 400-berth marina with 10 spots for mega-yachts, two golf courses so far and a casino resort on the way.

"The government wants to create Sentosa as a playground for the rich and famous," said Joseph Tan, director of residential property at CB Richard Ellis. "They're trying to build it as our Monte Carlo."

Roughly 60 percent of the buyers at Sentosa Cove are foreigners.

Providing services for Asia's super-rich is undoubtedly a growth market. The booming region is churning out at least 200,000 new millionaires a year, according to a recent report from Merrill Lynch and Cap Gemini, prompting comparisons to America's Gilded Age.

"The wealth of the wealthy in emerging markets is no different than the wealth of the wealthy in the Rockefeller days," said Roman Scott, who left a job analyzing the industry for BCG, a management consulting firm, last year to start his own investment advisory firm, Calamander Group. "It's the robber baron thing."

In a region known for its poverty, corruption and political turmoil, Singapore has long served as a refuge for wealthy ethnic-Chinese from Malaysia and Indonesia, who rely on its top-notch health care and schools. For many, Singapore's gleaming infrastructure, efficient bureaucracy and stable government more than compensate for its lack of press freedom, political debate and artistic ferment.

While the latest influx of wealthy foreigners is pushing costs up, property prices are still low compared with London and New York. Tax rates are low as well. Singapore does not tax capital gains or interest income. Its top income tax rate is 20 percent, and it does not tax income earned outside Singapore.

Much of the decision to promote private banking was the result of official soul-searching in 2002 in the midst of the global recession and China's investment boom. Singapore convened an Economic Review Committee from the private sector and government to chart a new course.

"They were facing China with no real game plan," said Robert Stein, a former head of Deutsche Bank's Asian operations who headed the committee's financial services working group.

The panel recommended that Singapore focus on luring hedge funds, private equity firms, insurers and private banks. Afterward, Singapore exempted foreign-earned income from taxation and modified its trust laws, guaranteeing the right of trust holders to determine who inherits their estate.

Bankers in Singapore say this is especially attractive to clients from Europe, where courts often overrule wills to give relatives a fair share, and from the Middle East, where Islamic courts sometimes pass over wives and children to hand over entire estates to the father and brother of the deceased.

Singapore had already beefed up its banking secrecy laws in 2001. While many banks are moving their back offices to India, bankers here say Singapore's secrecy rules are so tight, they are moving the data centers handling their private banking transactions from India to Singapore.

Concerns have emerged, however, that Singapore may also be attracting wealthy individuals who have something to hide.

Before his arrest in 2005 on charges of corruption and fraud, Gianpiero Fiorani, the former chief executive of Italy's Banca Popolare Italiana, stashed some of his assets in Singapore.

The Japanese fund manager and shareholder activist Yoshiaki Murakami moved his fund, MAC Asset Management, to Singapore before his arrest last year on charges of insider trading. And in December, the police in Shanghai arrested an unidentified Singaporean for running an underground bank that shuffled money between China and Singapore.

Singapore bankers say they are under pressure to know the nature of their clients' wealth - Singapore's secrecy rules do not extend to anyone involved in terrorism or smuggling. And the authorities say they are not trying to attract tax evaders.

"The Singaporeans have done an excellent job of balancing a pro-business stance with a regulatory environment that creates a well-disciplined environment for private banking," said Stein, now a director in London at German bank WestLB.

Still, some foreign governments are unhappy. A "Stop Tax Haven Abuse" bill, introduced in February by three U.S. senators - Democrats Carl Levin of Michigan and Barack Obama of Illinois and Norm Coleman, Republican of Minnesota - includes Singapore in its list of "probable locations for U.S. tax evasion." (Hong Kong and Switzerland are also included.)

Meanwhile, the European Union has been trying to persuade Singapore to follow the lead of Switzerland and other European tax havens, which have agreed to share information on accounts or collect a withholding tax.

Germano Mirabile, a policy officer at the EU Taxation and Customs Union Directorate-General, said Singapore had not yet responded to Brussel's overtures.

Because tax rates in Asia are generally low, Singapore's lure to Asians is less about escaping taxes and more about protecting assets from political vagaries. Many Chinese, for example, keep some of their earnings in Hong Kong. But for those who fear that Hong Kong is still within reach of Chinese authorities, Singapore has become increasingly popular.

Singapore's proximity to South Asia is also luring ethnic Indians, both those from the subcontinent and those from the Indian diaspora, like Chandran.

SingTel's new CEO annual pay around S$5m

2007-03-30T12:42:00.000-07:00

SingTel's new CEO to get S$75,000 a month, annual pay around S$5m
Posted: 30 March 2007 2234 hrs

SINGAPORE: SingTel's incoming CEO, Chua Sock Koong, will be paid a base salary of S$75,000 a month. Ms Chua is set to start her appointment on Sunday.

In a statement to Singapore Exchange, the telco says her salary will be reviewed at the board of directors' discretion each year.

In addition, she will be paid car and driver allowances amounting to S$5,500 per month.

Besides annual short term incentive payments, she will be entitled to participate in SingTel's long term incentive plan through performance shares.

SingTel's statement adds that the on-target total remuneration for Ms Chua is expected to be around S$5m for the financial year to next March.

If she exceeds her prescribed targets, SingTel's board can decide to pay her more based on her performance and market benchmarks.

Meantime, SingTel threw an in-house staff party for outgoing CEO Lee Hsien Yang.

In a speech, Mr Lee said his time at SingTel has been "incredibly fulfilling".

"If I could turn the clock back, I'd do it again. But let me say that, I suppose at some point in time, I need to move on. I know it's good for me and I know it's good for the company. Let me say that I've really enjoyed my time here," he said. - CNA/yy

M1 CEO paid up to $1.5m in 2006

2007-03-21T15:34:00.000-07:00

Published March 21, 2007

M1 CEO paid up to $1.5m in 2006

MOBILEONE, the smallest of three mobile-phone companies in Singapore, paid chief executive officer Neil Montefiore between $1.25 million and $1.5 million in 2006, according to the company's annual report.

Mr Montefiore, 54, was given 880,000 share options last year. In 2005, he was paid a similar salary and awarded one million share options.

M1 reported a 2.2 per cent rise in net income to $164.6 million in 2006 on sales of $773 million. Shares of M1 were unchanged at $2.19 at the close of trading yesterday. The stock has increased 1.9 per cent this year, compared with the 4.4 per cent advance in the Straits Times Index. - Bloomberg

DBS paid CEO between S$7.5m and S$7.75m in 2006

2007-03-08T14:47:00.001-08:00

DBS paid CEO between S$7.5m and S$7.75m in 2006
By Jeana Wong, Channel NewsAsia | Posted: 07 March 2007 2326 hrs

SINGAPORE : DBS has said it paid Chief Executive Officer Jackson Tai between S$7.5 million and S$7.75 million last year.

That was one-third more than in 2005, and in tandem with the group's earnings growth excluding one-off gains.

Last year, when DBS released its annual report, eyebrows were raised over the pay for head honchos Jackson Tai and Frank Wong.

They received big pay rises in 2005 despite the bank chalking up a 59 percent drop in earnings over 2004.

It was thus no surprise that their pay was in the spotlight on Wednesday, at the news briefing to release their 2006 annual report.

DBS Bank said the pay package for Mr Tai was being presented differently this year.

It is now reporting his total remuneration in a given year, regardless of when the actual payouts were made.

The variable component of the CEO's salary - such as bonuses and share plans - makes up 71 percent of the overall compensation.

This is sharply higher than the norm of just 30 percent in other corporations.

Chief Operating Officer Frank Wong was also paid between S$7.5 million and S$7.75 million.

Excluding Mr Tai and Mr Wong, the bank paid its 15 other management committee members a total of S$15 million in 2006.

DBS said it employed more senior management than its local rivals UOB and OCBC.

It also justified its decision to pay a director's fee of S$250,000 each for almost all its directors.

Mr Tai said, "Six of them are not from Singapore or not based in Singapore. I'm very proud of all 12 and it's quite a task to get these directors to chair our risk management committee, our nominating committee. We have a compensation committee, we have a credit committee, we also have a strategy and planning committee, so it's a lot of work involved.

"We look at industry practice. We want to make sure that we have the ability to keep and also attract the best directors we can."

A recent survey by human resources company ECA International revealed that senior managers in Singapore earned about five times more than junior-level managers.

At the press briefing on Wednesday, Mr Tai also dismissed rumours that he was hired on a contractual basis and might be leaving at the end of his contract. - CNA/ms

CapitaLand CEO $9.8 million paper gain

2007-02-03T00:55:00.000-08:00

CapitaLand CEO exercises options, ST, Feb 3,2007

CAPITALAND president and CEO Liew Mun Leong exercised options for a total of 1.8 million shares in the company at an average price of $1.67 per share on Feb 1. This has given him a direct stake of 0.065 per cent in the group. His deemed interest in the property group remains unchanged at 1.458 million shares or 0.052 per cent. Based on CapitaLand's $7.10 closing price yesterday, Mr Liew's 1.8 million shares from the options are sitting on a paper gain of about $9.8 million.

Malay Gals, 19, Own Peugeot Cars Woh!

2007-01-29T02:19:00.000-08:00

Jan 28, 2007
Cheaper prices, so young snapping up cars
By Nur Dianah Suhaimi

OWNING a car used to mean careful budgeting and years of saving.

But vastly cheaper prices, fuelled by a bumper crop of certificates of entitlement (COEs), have put car ownership within reach of many young adults, a noticeable number of whom are barely a few months into their first job.

More parents, too, are buying cars for their adult children, some of them settling the bulk of the payment in cash.

Teacher Mazri Misawar, 26, bought his own set of wheels just six months after he started work. He paid $49,000, including COE, for his silver Toyota Vios last January.

Said Mr Mazri: 'I've been wanting to buy a car for a long time. Since cars are so cheap now and the economy is good, I decided to go ahead.'

The Land Transport Authority's decision to release more COEs has helped lower prices. Last September, LTA added 8,520 COEs, which will be released over six months.

In the latest COE tender this month, the COE price for the small car category was $11,881. Back in 1994, the price briefly hit $100,000.

Undergraduate Marc Lim's blue Toyota Altis was paid for by his retiree father, mostly in cash.

Said Mr Lim, 21: 'The car cost about $70,000. Since the bulk is already paid for in cash, my father took a one-year loan.'

Last year, Ngee Ann Polytechnic student Siti Nur Puteri, 19, received a brand-new Peugeot 307 from her businessman father before she even got her licence. Her car cost about $90,000.

This year, her father bought a $70,000 Peugeot 1007, this time for her cousin, Miss Mas Indah Puteri, 19, also from Ngee Ann Polytechnic.

Said Miss Siti: 'We chose the Peugeot because we liked the design. I need a car to get to school.'

Figures by the LTA show a total of 116,849 new passenger cars were registered last year, beating the previous year's record of 109,376.

Many of these new cars are owned by young people, said car agents.

The 10 car agents The Sunday Times spoke to said more young people in their early 20s are buying cars.

Seven said they have seen a 10 to 20 per cent growth in sales compared with five years ago, when COE prices were still relatively high.

Said sales executive Andy Sophian from AutoHub Asia: 'Five years ago, it was rare to see youngsters in their early 20s buying their own cars. But now that cars are cheaper, even those who can't afford want their own car.'

Almost half of those driving the China-made Chery QQ cars here are in their early 20s, said Vertex Automobile, the sole distributor of Chery cars in Singapore.

The 812cc QQ retails for about $31,500 (with COE) and is now the least expensive car available here.

Said Vertex's spokesman: 'The cost of driving a Chery is just slightly higher than the cost of travelling by public transport. It's also cheaper than travelling by taxi, which can cost up to $900 a month.'

Said 27-year-old assistant brand manager Mr Bernard Quek: 'The roads are more congested now, and not only during the peak hours.'

Image Caption: ALTHOUGH THEY ARE JUST 19, Miss Siti Nur Puteri (right) and her cousin Mas are already proud owners of Peugeot cars. Miss Siti's businessman father bought both cars for them. -- WANG HUI FEN

Middle class wage stagnation could lead to social instability

2007-01-11T12:30:00.000-08:00

SINGPAORE: Middle class wages have been stagnant in the past 5 years, according to economists, and this could lead to social instability

These concerns were shared at the annual Institute of Policy Studies Singapore Perspectives conference.

Economists believe a US economy slowdown in business and consumer spending may cause problems for Singapore, but as Singapore is tops in the ASEAN resilience index, it should be able to weather external shocks, thanks to a diversified economy and strong Asian demand.

They predict that growth going forward will be above 3 to 5 percent.

The long term growth speed limits for a mature economy was previously in the 3 to 5 percent range.

However, economists are asking who this growth is for. The income of the bottom 30 percent of the population has fallen. What is more worrying is the fact that the majority of Singaporeans in the middle class has only seen about a 1 percent increase in nominal income in the last 5 years.

It is not just Singapore - economists say stagnant wages is a global problem, and the chief reason for this is globalisation.

India and China are introducing a large pool of skilled and unskilled labour to compete with the labour forces of industrialised countries.

Singapore is susceptible to this because of its open economy.

123, 000 jobs were created last year and economists estimate some 70 percent of these jobs went to foreigners.

"With the rate of immigration even among unskilled and semi skilled labour at a rate twice of what we experienced in the 90s, at a rate fastest in the developed world, the question is does this dampen our real wages as we grow? Does the strategy itself dampen real wages and depress real wages at the low and middle end of the spectrums? They are sacred cows but we should step back and think about them," said Yeoh Lam Keong, Vice President, Economic Society of Singapore.

Another reason cited for middle class wage stagnation, is the move by the government to cut CPF employer contribution rates for older workers by 4 percentage points over the last 2 years.

"So if you were a worker in the 50-55 age group, you could have seen your wages fall as much as 10 percent over the last 3 or 4 years. Now with the economy improving, the government could bring that back, the increase is 1 or 2 percent. I'm in support of CPF tinkering but probably it happens far too often, but I think there's probably some justification to look back and think that the restructuring was a bit too aggressive on the CPF side and it has contributed somewhat to a very sandwiched middle class," said Chua Hak Bin, Director, Asia Pacific Econ & Market Analysis, Citigroup Global Markets Singapore.

The government is looking at increasing CPF by 1 to 2 percent in 2007.

Economists say workfare should become a more permanent pillar of the economy so as to cushion growing inequality.

Adding that long term middle class wage stagnation could lead to social instability. - CNA /dt

ST: F&N chairman's retirement payout was $4m instead of $3m

2007-01-05T21:47:00.000-08:00

State-linked Singapore investment company Temasek Holdings has acquired a 14.9 percent stake in Fraser and Neave (F&N) for 900 million Singapore dollars (588 million US), the food and beverage maker has said. Friday December 8

Jan 6, 2007
F&N chairman's retirement payout was $4m instead of $3m
Wrong figure had been disclosed in last year's annual report
By Lee Su Shyan, Companies Correspondent

IT TURNS out that the bumper retirement gratuity paid to Fraser & Neave (F&N) non-executive chairman Michael Fam was actually $4 million, not $3 million as disclosed by the firm last year.

F&N said the wrong figure was inadvertently published in last year's annual report.

It also emerged that Mr Fam earned more in the year to Sept 30 than in the previous year - even though he retired from the top job a third of the way into the year.

Mr Fam, 79, stepped down as executive chairman in January last year but stayed on as non-executive chairman and as a consultant to the company.

The retirement payout, which was part of his contract, was for 23 years of service to the beverage, property and publishing group.

It was paid in January last year, but last year's annual report contained only the $3 million figure, while the extra $1 million appeared in the company's just-released annual report.

The latest annual report said Mr Fam received between $2.75 million and $3 million in total pay.

This comprised salary, which covered part of the year when he was still executive chairman, director's fees and fees for being a consultant to F&N. This is in addition to his retirement gratuity.

The previous year, he received between $2.25 million and $2.5 million in salary, bonus and fees.

Despite having retired from his duties as an executive chairman, he still remains the most well-paid director on the board.

Dr Han Cheng Fong, the former managing director who took on the post of group chief executive in February last year, was paid between $2 million and $2.25 million for the year ended Sept 30.

At last year's annual general meeting (AGM) in January, Mr Fam told shareholders that he was remaining as chairman and consultant to ensure a smooth transition. A search was launched for his successor.

But he will remain as non-executive chairman for the time being, at the request of the board, to oversee the entry of Temasek Holdings as F&N's second-largest shareholder. The search for a successor is still ongoing, according to F&N.

As a result of the Temasek deal to take up a 14.9 per cent interest in F&N, announced last month, the F&N board will swell to 11 or possibly 12 members.

Temasek is to get two board seats. One will go to Temasek's executive director, Mr Simon Israel. It is not known if Temasek will nominate another director for its second board seat.

Temasek's entry to the business will help spur the growth of the food and beverage businesses, for products such as the famed Tiger Beer, soft drinks and other beverages such as milk.

Already, F&N's unit Asia Pacific Breweries has increased the number of breweries from 24 last year to 29.

For the last financial year, food and beverage's revenue increased 3.5 per cent to $1.9 billion. The division's profits rose 10 per cent to $85.6 million, representing 29 per cent of F&N's total profits before exceptionals of $295 million.

F&N's share price rose 20 per cent over the financial year, exceeding The Straits Times Index's rise of 11 per cent over the same period.

F&N's AGM will be held on Jan 25.

------------
Mr Michael Fam's total remuneration for the year ended Sept 30 was between $2.75 million and $3 million. This amount is in addition to his retirement gratuity.

Keppel buys Keppel

2006-12-30T13:12:00.000-08:00

Published December 27, 2006

KEPPEL Land directors and their families spent $26.4 million buying units at its highly sought after Marina Bay Residences, which sold out completely two weeks ago.
In a statement yesterday, Keppel Land said managing director Kevin Wong and directors including Lim Ho Kee, Lee Ai Ming and spouse, and Heng Chiang Meng and spouse bought units.

Keppel Corp directors Lim Hock San and Yeo Wee Kiong and spouse also bought units, as did chairman Lim Chee Onn's son and daughter-in-law. In total, seven units were acquired.

A spokesman for Keppel Land said that there were no preferential discounts on the prices of the units but a special preview was offered to staff, including the directors, before the project was launched to the public.

For his four bedroom unit, Mr Wong paid $4.2 million, or about $1,780 psf.
The spokesman said that for Marina Bay Residences only, the directors will undertake to hold the units for at least three months before deciding whether to resell. Directors who bought units at another popular Keppel Land development, Sixth Avenue Residences at Sixth Avenue, will not have to hold on to them for any specified period.

In the same statement, Keppel Land announced that director Lim Ho Kee's wife and son bought a unit at Sixth Avenue Residences. Mr Lim's brother, together with his wife and daughter, also bought a unit. Keppel Corp director Yeo Wee Kiong and spouse bought a unit, as did the daughter of Lim Hock San. The four units bought totalled $7.2 million.

'The sale prices and percentage discounts given to the abovementioned purchasers were the same as those given to all other purchasers of similar units released at the same time of sale,' Keppel Land said in its announcement yesterday.
It is not unusual for directors and their families to buy into a company's developments. In June, Cecilia Kok, wife of City Developments chairman Kwek Leng Beng bought two units at St Regis Residences for $8.85 million and $11.4 million. Besides the public discount of about 15 per cent given to both units, the latter had a preferential discount of 2 per cent.

BT's article of 27 Dec, "Directors buy KepLand condos" refers.

Well, look who's buying up these high-end properties?

Isn't Mr Lim Chee Onn once a PAP minister in the Lee Kuan Yew government?

Also, Mr Heng Chiang Meng was also a PAP MP and one-time President of REDAS?

Correct me if I am wrong and if my memory serves me right, but was not Mr Heng asked by then PM Goh Chok Tong to relinquish his REDAS presidency in order to avoid potential/perceived conflict of interest in his lobbying efforts on REDAS' behalf (while acting as CEO of one of Far East Group's property companies) during the last property speculative frenzy 10 years ago?

What about Mr Lim Ho Kee - isn't he the Chairman of SingPost, another GLC?

Of course, all the above's family members also got in the act too, as seen from BT's article below.

Singapore is top buyer of luxury cars

2006-12-29T19:45:00.000-08:00

The Economic Times(india)

SINGAPORE: Singapore topped in Southeast Asia's luxury car sales for 2006 with strong economic growth resulting in a jump in purchases of Lamborghinis, Rolls-Royces, Bentleys and Porsches.

But the biggest passenger car market in the 10-country Association of Southeast Asian Nations (ASEAN) turned out to be Malaysia with 400,000 new cars sold from a total of more than a half million vehicles registered there, according to data published in Singapore's Business Times.

Thailand had about 180,000 passenger cars sold in an overall market of nearly 700,000 vehicles while Indonesia notched up 300,000 new vehicles.

In Singapore, an estimated 117,000 new cars were registered this year.

Despite a population of only 4.4 million people, a record 29 Lamborghinis were sold in the city state, up 53 per cent from 2005. Ten of the Italian cars were registered in Malaysia and 15 in Thailand.

"This year has the highest sale we ever had because of the economy and two new models," Rocco Basta, regional manager of Automobili Lamborghini, was quoted as saying.

He was referring to the Gallardo Spyder, with a price tag of 838,000 Singapore dollars ($540,000) and the limited edition Murcielago LP640 at 1.18 million Singapore dollars.

Colin Kelly, Rolls-Royce Motor Cars regional director, said buyers in Singapore were influenced by the vibrant economy.

"It is the feel-good factor," he told the newspaper. "In times when the economy is vibrant, the very wealthy people that buy our cars feel more comfortable."

Porsche saw a huge jump with sales of 170 this year, a 35 percent hike over 2005.

Thailand sold 80 Porsches, up 51 percent, and Malaysia sold 100, up five percent.

The more accessible luxury makes such as Mercedes-Benz and BMW have powered ahead with the highest passenger car sales in ASEAN, which consists of Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

Mercedes-Benz was expected to end the year with sales of more than 2,100 units and BMW with 3,700 units, the report said.

Singapore's Millionaires Increase at Fastest Pace in World

2006-12-25T09:49:00.000-08:00

June 10, 2006 (Bloomberg) -- The number of millionaires in Singapore rose at the fastest pace in the world in 2004, according to a report by Cap Gemini & Merrill Lynch & Co.

Singapore millionaires rose 22.4 percent to 48,500, the report said. In the U.S. the number increased 10 percent to 2.5 million and in Hong Kong they rose by 18.8 percent to 67,500. Asia had 2.3 million millionaires last year, up 8.2 percent, the research showed.

China's economic growth of 9.5 percent last year drove economic growth across the Asia Pacific region, the report said, and the world's most populous nation will continue to generate new wealth. Wealth globally swelled to $30.8 trillion by the end of 2004.

``China is generating wealth for a lot of people in Asia,'' said Stephen Corry, Merrill Lynch's vice president for regional equity strategy.

A yuan revaluation of 10 percent, which Merrill expects, would make it less expensive for mainland Chinese investors to purchase property here, or travel to the region for business and leisure. ``That spending effect is going to be positive for the entire region,'' he said.

Still, the number of Chinese millionaires grew by 4.3 percent to 299,500, compared with a 25 percent growth rate in 2003. That was due mainly to a slump in China's stock indexes, which are the worst performers among 79 benchmarks tracked by Bloomberg worldwide during the past 12 months.

Li Ka-shing, who controls Hutchison Whampoa Ltd. and Cheung Kong Holdings Ltd., is Hong Kong's richest and the world's 22nd richest man, according to an annual survey published by Forbes magazine. Singapore's richest man, property magnate Kwek Leng Beng, is worth $2.8 billion, Forbes said. Kwek owns City Developments Ltd., and the Millennium and Copthorne Hotel chains.

The report projects Asian wealth to grow by 6.9 percent annually to $10.1 trillion by 2009, compared with a 3.8 percent growth in European wealth to $10.7 trillion.

To contact the reporter on this story: Douglas Wong in Hong Kong at dwong19@bloomberg.net
Last Updated: June 10, 2005 08:04 EDT

ST: If you're not a bankrupt-turned-millionaire, You're SCREWED!

2006-12-24T09:58:00.000-08:00

Dec 24, 2006
BANKRUPT-TURNED-MILLIONAIRE'S GESTURE
$150,000 dinner, $100 hongbao for 1,400 who stood by him
By Melissa Sim

THE EMPORIUM department store uniform had sat unused in her cupboard for more than 10 years. But last Wednesday, 58-year-old Madam Low Lee Gek put on the white samfu with red trimmings and the knee-length red skirt again to celebrate the dinner thrown by ex-Emporium boss Lim Tow Yong.

'Wearing this makes me think back to the good old days,' said Madam Low, who had worked in sales at Emporium for more than 30 years.

Last Wednesday's dinner was Mr Lim's way of repaying the kindness his former employees had shown him 10 years ago.

In 1996 - down and out after he had sold off the company in the late 80s and been declared bankrupt - 800 ex-employees came together to throw a dinner for their ex-boss.

Mr Lim said that dinner gave him the motivation to carry on. Ten years down the road, he has bounced back and become a millionaire once again.

'It just touched my heart and I have never forgotten it. I've thought about it every day for the last 10 years and I told myself that I must work harder and one day pay them back,' he told The Sunday Times, in a feature published on Oct 29.

The former department store king made his second fortune opening stores in Sabah, Labuan and Brunei. Now his stores in Brunei and Labuan have a turnover of more than $100 million a year. Last year, he and his partners made RM10 million ($4.2million) selling the stores in Sabah.

Mr Lim felt it was time to repay his former employees.

Close to 1,400 responded to advertisements placed in the Chinese newspapers and gathered at the Raffles City Convention Hall last Wednesday.

The atmosphere was buzzing as old colleagues caught up with each other between the eight-course Chinese dinner, while stage performers sang the kind of classic Mandarin songs that might have been heard playing in Emporium in its heyday.

No expense was spared. On the venue and the dinner alone - which included shark's fin soup and scallops - Mr Lim spent about $150,000.

He also gave a $100 red packet to each of the 1,400 people there.

Said housewife Tay Bee Eng, 51, who worked in the HR department for three years: 'I'm already very touched that he bothered to treat all of us to dinner. I didn't think he would give each of us a red packet.'

Said Mr Lim: 'This is just my way of expressing my gratitude.'

Picture caption: BACK ON HIS FEET, former Emporium boss, Mr Lim, at the appreciation dinner he threw for ex-employees. Bankrupt 10 years ago, he is once again running a successful retail business. -- WANG HUI FEN

ST: If you're not a millionaire, You're SCREWED!

2006-12-18T12:12:00.000-08:00

Dec 17, 2006
ME & MY MONEY
Millionaire investor enjoys good run with property, bonds
Isaac Chin has also reaped handsome capital gains and yields by investing in Reits
By Leong Chan Teik

IF ISAAC Chin takes a 10-minute stroll from his simply furnished private apartment, he arrives at Chinatown, where he grew up in crowded quarters in a shophouse.

His father was an immigrant from China and was often without work, but he had five children to feed.

Despite his tough beginnings, Mr Chin, 57, has made good. His investments in property, bonds and stocks have made him a multi-millionaire.

He credits his success to the tough times: 'Nobody would help you. You fight for your own survival. That gives you strength.'

He cited one example during an interview at his home. He worked as a civil servant for about nine years and saved up before he enrolled in a university in New Zealand at the age of 28.

He met his wife there and returned to Singapore as a chartered accountant.

His training and work experience gave him a nose to suss out profitable investments.

Six years ago, he became a full-time investor while his wife continued as a management lecturer in a polytechnic.

They have a 21-year-old son, who has just completed national service while their 24-year-old daughter is an actuary in an insurance company in Australia.

Q With financial markets as high as they are now, how do you invest?

A I feel some fear as I have seen how sharply the market can go down. My money is hard-earned so I'm protective of it.

Instead of stocks, I now hold a lot of Singapore government bonds. They give me regular income which is not taxable.

The bonds are part of the way I play the investment game. If the stock market crashes, I'll move money out of bonds into equities.

Q What is an example of a big winner for you?

A When Singapore Post was listed in 2003, I bought huge chunks of its shares. When I like a stock, I'd buy at least $500,000 worth.

The price of SingPost was 63 cents at the initial public offering. It has risen to over $1 now, and I still hold the shares.

Q What else are you invested in?

A Real estate investment trusts (Reits). I bought Reits when they were introduced in Singapore in 2002. They have given me very good capital gains and yields.

Overall, my investment gains, including dividends and trading profits, have averaged 18 per cent to 20 per cent a year since 2000.

Before 2000, I invested in properties.

My first home was a five-room HDB flat in Bukit Merah which cost $93,000 in 1982. I was about 33 years old then and had just married.

We sold the flat for $335,000 about 10 years later.

Q What was your first investment property?

A It was bought in 1986, during a recession. We paid $312,000 for a unit in Ridgewood condominium in the Holland Road area. It came with Japanese tenants paying $2,000 per month.

The gross rental yield worked out to nearly 8 per cent a year, which was very good.

We sold it for $500,000 after four years.

After buying and selling a few properties, by 2000, I had made $1 million in capital gains.

I decided to invest in bonds as they paid much higher yields than bank interest rates then.

I also ventured into stocks and Reits. The latter is better than physical property which is illiquid. With one phone call, I can get out of Reits.

Q As for your current home, what paper gain, if any, do you have?

A My wife and I bought it eight years ago for $773,000. It's a 2,200 sq ft apartment with four bedrooms.

It is expected to be sold en bloc soon, and we will receive $1.4 million for it.

Q Why did you quit full-time work to manage your investments?

A I didn't have an inspiring career as an accountant. Nothing great came out of it.

If I have to work hard for a salary and put up with a lot of stress, I might as well work for myself - and earn more.

Q How do you reward yourself?

A I live a simple life. My wife takes the car, a Toyota Corolla, to work. If I go out, I'd take the MRT or taxi.

I'm basically a Chinatown man at heart. I don't own a Rolex watch - it's not necessary.

My wife and I like to travel - to places such as Japan, New Zealand, Rome, Venice, Paris and Switzerland.

Q Do you give back to the community?

A Yes, to various charities such as the Cancer Society. My wife gives a five-figure sum a year to her church.

[=> To secure a place in Heaven?]

Q What's next, moneywise?

A If I continue to invest successfully, it's more than just about the money. It's the satisfaction of being able to do a good job.

To enjoy wealth, one must have health. That's why I jog for an hour every morning and eat simply. If I eat rich food all the time, it will kill me.

ST: If you're not earning S$100,000, You're SCREWED!

2006-12-17T09:30:00.000-08:00

Dec 17, 2006
WHY HE QUIT
6pm: Nose surgery; 8pm: Back at work

SOME called him crazy, but he did not care. Even an annual basic salary of $100,000 was not enough to keep him in the job.

[=> $770k leh?]

After seven months as an investment banker in London, Mr Chris Ho, 28, decided to call it quits.

'You earn all that money but have no time to enjoy it, because whatever free time you have, you just sleep,' said the London School of Economics graduate with a degree in Economics.

The unpredictable hours also took a toll on his social life.

'I couldn't even make dinner plans. If my boss asked me to do something at 6.45pm, I would have to do it and cancel on friends,' he said.

But the final straw was when he had to go for a surgical procedure in January at 6pm and had to be back at work two hours later.

While the operation was a simple one - the fusing of capillaries in the nose to stop his nose-bleeds - he had been on local anaesthetic and felt he should have been given some time to rest.

'It was a bit too much for me to take and I just started thinking about why I was in the job,' he said.

A month later, he tendered his resignation.

Mr Ho admitted the big pay packet was a key reason for taking the job in the first place.

Before landing it, Mr Ho spent 10 weeks interning with the bank. They paid him £5,500 ($16,590) for the stint - which works out to about $6,600 for a month's work.

'I earned more in the internship than my dad earned in two months when he started working,' said Mr Ho.

When he started with the bank, the sign on bonus was £4,000 and the salary was £35,000.

Now, as a teacher at a junior college, Mr Ho earns a third of what he was getting in London, but he does not regret his decision.

'I have more of a personal life and I gain more satisfaction from what I do,' he said.

Melissa Sim

ST: If you're not earning S$771,025, You're SCREWED!

2006-12-17T09:23:00.000-08:00

Dec 17, 2006
Young super earners
A banner year for bankers and traders who will outearn many of their peers in other fields
By Melissa Sim

THERE'S never been a better time to be a banker, or so Mr Yeo Soen Ming will tell you.

The 34-year-old MBA holder from London Business School expects to earn more than US$500,000 (S$771,025) this year, including bonuses.

As a banker working in institutional equity sales, Mr Yeo helps clients make money through buying and selling stocks.

[=> Stock broker say stock broker lah!]

'The thrill at the end of the day is knowing that you made the right calls and made money for the client,' said the father of one.

The handsome reward he is expecting is the result of a banner year for bankers and traders across the globe, spurred on by a booming stocks and commodities market and a high number of company sales and takeovers.

The US$3.46 trillion in acquisition deals this year broke the record set in 2000. The global nature of the job means that even those in Singapore handle clients around the world, and reap the rewards.

Just last week, Goldman Sachs Group announced earnings of US$9.54 billion - the highest in Wall Street history.

It will set aside US$16.5 billion for salaries, bonuses and benefits - translating to an average of US$622,000 for each employee.

Other top investment banks such as Morgan Stanley, Lehman Brothers and Merrill Lynch have also benefited this year from the robust world economy.

The cash that they are handing out to employees is turning the traditional idea of a lucrative career on its head.

Yes, doctors and lawyers make a lot of money, but they have to wait for years until they reach a senior enough level.

Investment bankers and traders are raking in the really big bucks this year - even when they are relatively young.

Checks by The Sunday Times showed that the remuneration in investment banking and trading exceeds that in law and medicine.

In their first year on the job, investment bankers and those in sales and trading can earn a basic annual pay of $100,000.

By the time they are 35, this can go up to $500,000 including bonuses - $40,000 a month.

Lawyers, on the other hand, are paid a starting salary of about $50,000 at big firms such as Drew and Napier and Rajah and Tan.

Doctors start off with about $60,000 after housemanship.

But while a lawyer may make $400,000 a year by 35 if he is made a partner, a doctor would earn that kind of money only when he becomes a specialist in private practice - which usually does not happen till about 45.

So it is just as well that Ms Janice Foo, 28, did not become a doctor.

[=> As if she can!]

Working in foreign exchange sales - buying and selling currency for institutional investors - in an American investment house, she is another of Singapore's young high-fliers.

Although she declined to disclose her pay, she told The Sunday Times that she could well afford the downpayment and instalments for a BMW and a swanky apartment in town.

Her businessman father

[=> Fake meritocracy?]

had always wanted a doctor in the family, but she decided to do a bachelor's degree in accounting and finance, and a master's in finance from the University of New South Wales in Sydney.

The decision has paid off.

Headhunter Declan O'Sullivan, from Kerry Consulting, explained that bankers like Ms Foo are highly paid because there are only a handful who can do the job well.

'Each of them is like a fighter pilot, you only need one really good guy flying the plane,' he said, adding that each of them is often responsible for millions of dollars.

The unforgiving nature of the job also accounts for the high pay.

Trader Joao Lay, 32, who did his masters in finance at the Royal Melbourne Institute of Technology and now earns more than $200,000 a year, said: 'When things go your way, you're rewarded handsomely, but if you don't live up to expectations, you're out.'

Mr O'Sullivan agreed: 'It's high risk, high return.'

[=> PAP Ministers = Low risk, high return?]

Then there are the long days and punishing schedules.

Ms Foo, who just got engaged, works 12-hour days which begin at 7am, stares at six computer screens throughout the day, and only allows herself a five-minute break. Getting calls from clients in the US at 3am is par for the course.

[=> As if the other lowly paid workers dun need to work long hours!]

Investment bankers have it worse. They work 16-hour days, seven days a week and hardly ever get the chance to take annual leave.

[=> As if other professionals dun need to work long hours!]

Mr Yeo cited the case of a former colleague who called in sick one day, thinking he could have the day off. But his boss couriered all the documents to him so that he could work from home.

Investment banker G. Lim, 26, said that the long hours and ad hoc business trips truly take a toll.

'We make intra-day trips at really short notice, we get up at 4am, fly at 7am, attend a two-hour meeting, fly back and are expected to finish up all the day's usual work,' he said.

All the people interviewed declined to name their employers.

National University of Singapore graduate X.W. Lee, who is in her mid-20s and works in institutional sales, enjoys what she does, but says that the stress level is high.

She works from 5.30am to 6pm and spends her weekends doing research and planning proposals.

'Those who say they envy us because of our pay must understand that, in reality, the job is not as glamorous as it appears,' she said.

Big bucks only to be expected

Name: Yeo Soen Ming
Age: 34
Occupation: Institutional equity sales
Earning power: Over US$500,000 this year On his pay: 'If you're at this level and you don't make around US$500,000 this year, that would be quite sad. Look at it this way: In the first year out of business school, you're expected to earn US$180,000 to US$200,000. I've been out of business school for four years.' --WANG HUI FEN

Singapore's Middle Management

2006-12-12T23:00:00.000-08:00

By Terence Chong, TODAY

SINGAPORE: When championing globalisation, it used to be that politicians only had to worry about low-wage workers. Now it is increasingly clear that globalisation not only threatens low-wage workers in developed countries, but the middle class as well.

The burgeoning corpus of studies in Europe and America has exposed one of the fallacies of globalisation - that is, the middle class would always beat the competition by re-educating and retraining.

Instead, these studies have shown that white-collar "new economy" jobs have flown from high-wage to low-wage countries, especially to low-wage countries that educate and train their own workers in order to attract high-value investment.

In recent weeks, Prime Minister Lee Hsien Loong made two important announcements that addressed the concerns of the middle class. Firstly, the needy sections of the Singaporean middle class will get Government assistance and, secondly, Singaporeans will pay less than Permanent Residents (PRs) and foreigners for education and health services.

These announcements, designed as systematic policy initiatives to buffer the more vulnerable sections of the middle class from the side-effects of globalisation, also signal a change in the Government's relationship with its middle class.

Being the largest, albeit hard to define, and usually most politically reliable constituency, the middle class' relationship with the Government is the broadest barometer for the social compact between state and society.

This social compact, according to President S R Nathan in his address at the opening of Parliament, is being forged anew. Under the "old" social compact, the middle class received sweeteners from time to time in the form of the Progress Package or Singapore Shares, but has, in general, been largely left on its own. This is because it was, unlike the working class, assumed to possess the necessary skills and qualifications to survive global market trends.

The Government's new initiatives suggest that it is now politically trickier to tell the needier members of the middle class to lower their expectations to meet their income means.

During the Asian financial crisis in 1997 and the recession in 2001 it was not uncommon for Singaporeans to be told that the Government could not be expected to provide financial assistance to maintain their pre-recession lifestyles.

However, a number of other genuine cases were turned away because their monthly household income exceeded the threshold to qualify for help. As was pointed out by another writer earlier in this column, for the sandwiched class, absolute monthly household income should not be the criterion for financial assistance - instead, the number of persons relying on this income should be taken into account.

Furthermore, the persuasion to downgrade, also prevalent during adverse economic times, seems to have all but faded, replaced by the ringing refrain of Mr Lee's "no Singaporean will be left behind" assurance.

Some may take this as evidence that the Government has gone "soft" on welfare, but a less cynical view would be that it recognises that the ill-effects of globalisation cannot be disentangled from its fruits, and that the middle class has taken its fair share of hits. The sentiment on the ground is that being Singaporean must count for something other than qualification for HDB subsidies.

And this is where the second initiative - to cut health and education subsidies for PRs and foreigners - comes in. This move will have more symbolic impact on the sandwiched middle class than on the poor or rich.

It has been announced that PRs would see a 10 percentage point reduction in hospital subsidies over two years. It remains to be seen what the education figures will be, but overall, they are not expected to be too drastic - enough to psychologically reinforce the rights and privileges of citizenship, but not enough to deter foreigners from coming.

This political management of perception over the comparative statuses of citizens and foreign talent suggests that the "new" social compact must take into account the sensitivities and perceptions from the ground, and not just simply deliver the economic goods, as was the case in the past.

At best, this move could foster some sense of collective identity; at worse, it would be a token gesture to appease the insecure.

In acknowledging that the middle class has needs, the Government is, in effect, conceding that the politics of class and envy are entrenched in Singapore society. Such politics are not merely informed by the woes of globalisation, but also complicated by the issues of foreign talent and the elite divide. What was formerly dismissed as complaining, unrealistic expectations from a spoilt middle class is now treated as a serious policy issue to be accorded serious attention under the promise of a "new" social compact.

The Government's initiatives could also force us to re-examine our faith in the infallibility of meritocracy in the long run.

Globalisation and neo-capitalism have little regard for talent and merit that do not help sustain them. Hence, while Singaporeans believe that all our talents will be justly rewarded, globalisation is a fussy benefactor that only rewards what the market demands.

The section of the middle class increasingly marginalised by capricious market trends will wonder what happened to the mantra of honest pay for honest work. For them, the ideology of meritocracy could ring hollow.

As Singapore society accelerates towards greater stratification, and as the classes begin to reproduce themselves, the politics of class and envy would increase. Conspicuous consumption by the rich, callous remarks by the "elite" and the pernickety forces of globalisation may blur the lines between the working and lower-middle class in the years to come, creating a collective identity of frustrated citizens.

Hence, the Government's initiatives and promise of a "new" social compact are a timely intervention in the ongoing renewal of state-society relations.

The writer is a Fellow at the Institute of South-east Asian Studies. This is a personal comment.

Licking the problem of welfare for middle-income group

2006-12-08T23:09:00.000-08:00

By Chua Mui Hoong
The Straits Times, Dec 8, 2006

WHEN I was growing up, ice cream was a luxury. A fruity stick cost about 10 cents, and buying one required a hard decision.

In my teens, the occasional tub of Magnolia or Wall's ice cream was a treat.

Then I started work. Soon, I discovered the Haagen-Dazs and Ben & Jerry's varieties of ice cream, and then local gourmet ice creams, Italian gelatos and the like.

These days, I don't waste my ice-cream quota on plain vanilla from Wall's. When I do indulge, I go for Ben & Jerry's, or the rich creaminess of flavours from places like The Daily Scoop (whose chendol flavour inspired this column).

Doesn't matter that a tub of Wall's costs a few dollars, and the branded ones I favour cost at least three times as much. At my age (and weight), eating ice cream involves a strategic decision: Go only for the most delicious; mediocre ice cream isn't worth getting fat for.

But I know that even though I may spend more on ice cream today than in the past, it's because I choose the pricier stuff nowadays - not because the cost of ice cream has gone up.

But when people complain about the cost of living going up, I sometimes wonder if they're feeling the pinch because the cost of basic stuff, like rice, school fees and transport, has gone up - or because they're just choosing dearer items to spend on.

As Singapore gears up to help the low- and middle-income in the wake of a rise in goods and services tax, the issue becomes more pertinent.

President SR Nathan, delivering the address to open the new Parliament session last month, spoke of the need to forge a new social compact. Prime Minister Lee Hsien Loong returned to the same theme a week later, when he said globalisation risked straining the social compact, and there was a need to do more to help the low-income group.

My sense is that few Singaporeans would disagree with the move to do more to help the bottom 20 per cent of households, whose incomes have stagnated or even fallen over the years.

The central plank of the Government's assistance for the bottom 20 per cent is Workfare, a major experiment in welfare for Singapore.

At its heart, this is a permanent income support system to prop up the incomes of those whose own honest labour cannot earn them a decent living wage.

The emphasis now is on the employed: Those aged 40 and above, who earn $1,500 or below a month, will get a Workfare Bonus from the Government.

But already, calls are coming in to expand Workfare to include more groups. How about those who can't find jobs, ask some analysts.

How about me, asks the man earning $2,000 who has to support a family of four. Don't I deserve Workfare as much as the person earning $1,500 with no dependants?

Each appeal has its merits. Should the state use taxpayers' money to meet those demands?

Already, MPs are sympathetic to the calls.

Last year, Mr Sin Boon Ann asked rhetorically: 'Should a middle-class family with young children attending enrichment classes now be required to stop these classes immediately simply because both parents are out of a job and are seeking public support?'

Last month, new MP Lim Wee Kiak spoke up for families 'in the gap'. Even families with a maid and a car could need help, he said, since a maid may be necessary if both parents are working, and a car allows the parents to ferry children to and from a caregiver's home.

Should ballet classes, cars and domestic help be considered 'necessities' which the Government should help fund for the middle-income group?

I don't think there is justification to do so. At the same time, I do have some sympathy for the plight of what I call the 2k families: those earning around $2,000, who could do with some help.

Part of the confusion has come about because of a lack of clarity over what exactly is meant by 'middle-income'.

Where should the new cut-off be?

One possibility is to redefine the meaning of the 'low-income' needing help, to go beyond the traditional cut-off of the bottom 20 per cent of all households, to include those up to the 30th percentile, who also saw incomes stagnate over the years.

This would bring the cut-off from the current $1,500 to about $2,000.

Doing so, however, is not the same as saying the middle-income or middle-class should also be helped.

The 'middle-income' should, strictly speaking, refer to those households with working adults whose earnings fall around the 40th to 60th percentile of incomes.

Last year, that group of households had income from work amounting to $4,400 to $5,220 - not exactly a paltry sum, although it is true that a family with two school-going kids attending tuition and enrichment classes, with a maid and car, would still struggle financially. Should the state therefore step in to help them afford the trappings of a middle-class life?

As Singapore starts to consider how to help the 'middle-income', it is prudent for us all as a society to think about just how we want to redistribute income.

Should Singapore focus its income redistribution efforts tightly on those at the bottom 20 to 30 per cent - and risk growing disenchantment among the middle-income group?

Or do Singaporeans want to become like those northern European states where incomes are flatly distributed (with a large middle class, and a narrow range between the top and bottom income), but where taxes are high and unemployment relatively high?

Or perhaps Singapore should aim for something in between: a society that subsidises not only the bottom 20 to 30 per cent with some form of income support, but also helps those in the 40th to 60th percentiles afford the trappings of a middle-class life, like ballet classes, a car and a maid.

This last option will require more government spending than is currently available. My own sense is that at some point, the taxpaying class (the top 25 per cent) will revolt at the prospect of their hard-earned money going to pay for someone else's car/maid/ballet lessons.

Each choice of welfare policy entails trade-offs.

With the seminal Workfare Bonus now a permanent feature of the social safety net here, the Government has made clear its commitment to redistribute income in a long-term, direct way to low-income households.

But as pressure mounts for the avalanche of aid to be extended to the middle-income, Singaporeans and the Government alike should pause and ponder: Just where should the line be drawn? Who should be helped, by how much, to do what?

Singapore Economic Growth to Slowdown in 07

2006-12-07T02:04:00.000-08:00

Singapore Economic Growth to Ease in '07

SINGAPORE (AP) - Singapore's economy will likely decelerate in 2007, but analysts expect modestly slower growth in the electronics industry with overall expansion at the center of the government's target range.

"We expect the electronics slowdown to be quite modest with some sectors remaining supportive of overall growth," said Selena Ling, a strategist at OCBC Bank.

The Monetary Authority of Singapore's quarterly survey, issued Thursday, shows that economists expect the economy to expand by 5.2 percent in 2007, a slightly faster pace than the 5.1 percent forecast in September.

The survey follows a recent government forecast for economic growth between 4 percent and 6 percent in 2007, and indicates that weaker demand for Singapore's electronics exports may have a limited impact on overall expansion.

The government recently highlighted the semiconductor industry as a key source of potential slowdown.

But OCBC's Ling said that the chip sector will be balanced by robust demand for other products, like gaming consoles and music players.

"The North American semiconductor book-to-bill ratio has dipped below one, but consumer electronics products should still fare well," Ling said. "We should still see support from the electronics sector."

The survey forecasts the island republic's non-oil domestic exports to grow by 9 percent in 2007.

In 2006, the survey predicts that non-oil exports will increase by 11.0 percent, slower than the 13.2 percent projected in September.

David Cohen, an analyst at Action Economics said that the lower export forecasts reflect the most recent round of economic data.

"It's just incorporating the latest data like export figures from the start of the (fourth) quarter," Cohen said.

Non-oil exports expanded 3.8 percent from a year earlier in October to a total of 14.80 billion Singapore dollars, compared with 8.2 percent growth in September.

Electronics exports, which represent about half of all non-oil exports, contracted by 2.6 percent from a year earlier in October.

Economists also increased their 2006 growth forecast to 7.8 percent from 7.1 percent last quarter, which is within the government's recently revised target range of 7.5 percent to 8.0 percent.

© 2006 The Associated Press.

Workfare Scheme for Middle income groups as well?

2006-12-06T14:34:00.000-08:00

Top up retirement accounts of older workers as Workfare becomes permanent: NTUC

SINGAPORE: The labour movement has called on the government to consider topping up the retirement accounts of older workers while not forgetting the middle-income workers when reviewing the Workfare scheme to make it a permanent feature of Singapore's social safety net.

69-year-old Maggie Teo earns about S$1200 a month as a cleaner at this hawker centre.

She qualified for the Workfare bonus earlier this year and received half a month's salary.

She is also likely to benefit from the permanent Workfare scheme, details of which will be announced by Second Finance Minister Tharman Shanmugaratnam on Budget Day next February.

The National Trades Union Congress hopes more will be done to help older workers like Maggie.

"What we do expect to see in the package is a combination – Workfare bonus as a cash payment to incentivise people to look forward to getting something in cash after a certain period when they've worked, and also payment in other areas, for instance, in the CPF account, the Medisave account, Edusave accounts of children," says Halimah Yacob, Assistant Secretary-General of NTUC.

"I think that will be good also, if the government could consider topping up the retirement accounts."

The labour movement is also concerned about workers, who fall within the sandwiched or middle-income group, especially with the proposed rise in the Goods and Services Tax. This is a group that makes up half of the working population.

Mdm Halimah, who is also the MP of Jurong GRC, says: "The 50 percent must also get support, assistance because they also feel the middle-income squeeze. They also felt the impact of globalisation.

"Some of them are affected by job losses. Starting afresh, they also need help and attention. It may not be in the form of Workfare bonus but it could be in the form of the equivalent of Economic Restructuring Shares the Government introduced when GST was increased in 2003, 2004."

The labour movement lauds the Government's move to make Workfare permanent as the right strategy. This move is also viewed as a recognition that there will always be workers caught in the poverty trap due to globalisation, whether the economy is doing well or not.

The Workfare scheme aims to help low-wage workers get out of the poverty trap and prevent another generation of low-income workers in the future. - CNA/so

Lee Hsien Loong says middle income groups not forgotten

2006-12-03T20:51:00.000-08:00

"We'll have a comprehensive offset package – more than adequate to care for Singaporeans, to help them adjust to the additional GST. It'll be weighted towards the lower end, so lower income Singaporeans will get more."

"We will also have something for sandwiched classes, the middle income groups. I know many in the middle income group tell us they have missed out on the benefits. They're confident the government will look after for the low income but (some of them say,) what about me? I am not so poor but we need a little help too. Don't worry, we have not forgotten you. We will have something for middle income groups too." - CNA

Ministerial Salaries to go up?

2006-12-03T20:40:00.000-08:00

Civil service salaries may go up next year says Minister-in-Charge of the Civil Service Teo Chee Hean:

We will continue to make sure we will remain competitive both to recruit and to retain. We want to make sure we not only retain those with experience, but also provide challenging careers for those who are well-remunerated and those looking for new jobs,"

On whether ministerial salaries will also be revised accordingly with the rise in private sector salaries, Mr Teo had this to say.

"We have to look at the benchmark to see where they are to decide what kind of adjustments we need to make. The benchmarks are basically to keep up with the private sector.

I must emphasise that the civil service does not set the pace for the private sector but, really, it follows what the private sector is doing. It's a much larger employer than the civil service, so we take benchmarks from IRAS aggregated data, CPF data and other data and match what is happening in the private sector."

PAP to cut corporate tax rate (for the rich)

2006-11-14T22:44:00.000-08:00

Singapore is prepared to cut its corporate tax rate to remain competitive in the global race for investments, Prime Minister Lee Hsien Loong was quoted by local media as saying.

Mr Lee said Singapore might have to adjust its current 20 per cent corporate tax rate if Hong Kong moved to lower its own 17.5 per cent rate, the Straits Times reported.

Mr Lee made the comments in parliament on Monday, where he also revealed plans to raise the Goods and Services Tax (GST) to 7 per cent from the current 5 per cent.

The Hong Kong government has proposed a GST to broaden its tax base, and says reductions in income or profits tax, or even both, would accompany any introduction of such a tax. But it is facing mounting public opposition to its plan.

"Hong Kong is competition for us," he said. "If they do a GST, they may decide to bring their corporate tax down. We may have to follow them down." - NZ

PM Lee: GST to be raised to 7%

2006-11-13T22:34:00.000-08:00

"It will give us precious extra resources to implement social programmes like Workfare later on. Our aim is to help the lower income groups and the elderly, not to increase their burdens. When we implement the GST increase, it's not just the GST increase, it's the package which will fully offset the impact of the GST increase and begin to strengthen the social safety nets and tilt the balance in favour of the low income groups - we will not just raise the GST but we will have a comprehensive offset package"

This package will be weighted more to the middle and the low income groups, especially the elderly, and it will more than offset the GST increase.

"It is not just an offset package to deal with the GST. It is a whole set of measures which we are taking in order to tilt the playing field in favour of the lower income group, which is what we have to add and tally in the balance, and my purpose is to help the lower income group. For the middle income, it will be generally about ok; for the higher income, I think the higher income should end up paying more overall. It's part of being one society. I'm not going to tax 15% on income tax, I'm not going to tax 25% from GST the way the Scandanavians do, but I have to make the adjustments of 2% which I think is fair and I think Singaporeans will support,"