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Upfront: with NMP Siew Kum Hong
Foreword: Mr Siew Kum Hong obtained his law degree with honors from the National University of Singapore. He is currently working as a Senior Counsel for CA (Asia South region). Mr Siew was sworn in as a Nominated Member of Parliament (NMP) on 22 January 2007.
KRC: The Jobs Credit Scheme (JCS) was introduced earlier this year to encourage businesses to preserve jobs. How would you rate its effectiveness so far? What alternative measures do you propose that will help Singapore tide through the current economic crisis? What kind of safety nets would you propose so that the low income families will not lack further behind during the current crisis?
Kum Hong: I think it’s important to first define the purpose of JCS. It was originally positioned as being a scheme to save jobs - but in the course of the Budget debate, it was clarified as being intended to reduce business costs, but structured in such a way as to encourage businesses to save Singaporean jobs.
To the extent that it reduced business costs, of course JCS has worked. And to answer the PAP MPs, yes JCS is preferable to cutting the employers’ CPF contribution rate for the purpose of reducing business costs, but that is a very narrow way of framing the question (i.e. solely in terms of reducing business costs).
But if you want to assess its effectiveness in saving Singaporean jobs, then it is impossible to definitively conclude either way, and the Government itself had basically said so as much. We can only guesstimate. While feedback from employers has been uniformly positive, I would nevertheless take that with some salt since they have a very strong self-interest in seeing the scheme continue (since it is essentially “free money” for them).
I think the recession so far has not hit jobs as hard as had been feared, but unfortunately it’s still early days yet in the recession and we will have to wait and see how the rest of the year plays out.
As for other measures to help the Singapore economy as a whole - well, that’s tough, because this recession is driven by external factors, so I think the Government is really doing pretty much everything that is sensibly possible in terms of helping the economy stay afloat. But if you are referring to measures to help Singaporeans, then please see my Budget speech at http://siewkumhong.blogspot.com/2009/02/budget-2009-speech-on-budget-statement.html for some suggestions.
KRC: You brought up interesting points regarding the approval process for the use of our national reserves during this year’s Budget statement in February. If you were in position to revamp or tweak this approval process for using our reserves, how would you go about doing it?
Kum Hong: As Minister Tharman says, there is a fundamental disagreement in philosophy between the PAP/Government and folks like myself - they place their faith in good men, while we would prefer a sound system (ideally, populated with good men!). So that is the difference. The PAP’s approach allows for the opacity and non-transparency that currently exists, but it presupposes and assumes that the people in the system are honest and trustworthy and, more importantly, will always remain so. I would prefer not to do things on the basis of that assumption being eternally true.
In terms of how I would go about doing it, I think it would be fully transparent, with the Government having to publish fully reasoned arguments for using the reserves, the Council of Presidential Advisers publishing full and complete reasons for their recommendation, and the President publishing full and complete reasons for his/her decision whether to give approval. Even if you accept that the secrecy around our investments and reserves is justified, it is hard to see how publishing all these decisions and reasons around the use of our reserves could be prejudicial to anything.
Upfront: with NMP Siew Kum Hong
Foreword: Mr Siew Kum Hong obtained his law degree with honors from the National University of Singapore. He is currently working as a Senior Counsel for CA (Asia South region). Mr Siew was sworn in as a Nominated Member of Parliament (NMP) on 22 January 2007.
KRC: The Jobs Credit Scheme (JCS) was introduced earlier this year to encourage businesses to preserve jobs. How would you rate its effectiveness so far? What alternative measures do you propose that will help Singapore tide through the current economic crisis? What kind of safety nets would you propose so that the low income families will not lack further behind during the current crisis?
Kum Hong: I think it’s important to first define the purpose of JCS. It was originally positioned as being a scheme to save jobs - but in the course of the Budget debate, it was clarified as being intended to reduce business costs, but structured in such a way as to encourage businesses to save Singaporean jobs.
To the extent that it reduced business costs, of course JCS has worked. And to answer the PAP MPs, yes JCS is preferable to cutting the employers’ CPF contribution rate for the purpose of reducing business costs, but that is a very narrow way of framing the question (i.e. solely in terms of reducing business costs).
But if you want to assess its effectiveness in saving Singaporean jobs, then it is impossible to definitively conclude either way, and the Government itself had basically said so as much. We can only guesstimate. While feedback from employers has been uniformly positive, I would nevertheless take that with some salt since they have a very strong self-interest in seeing the scheme continue (since it is essentially “free money” for them).
I think the recession so far has not hit jobs as hard as had been feared, but unfortunately it’s still early days yet in the recession and we will have to wait and see how the rest of the year plays out.
As for other measures to help the Singapore economy as a whole - well, that’s tough, because this recession is driven by external factors, so I think the Government is really doing pretty much everything that is sensibly possible in terms of helping the economy stay afloat. But if you are referring to measures to help Singaporeans, then please see my Budget speech at http://siewkumhong.blogspot.com/2009/02/budget-2009-speech-on-budget-statement.html for some suggestions.
KRC: You brought up interesting points regarding the approval process for the use of our national reserves during this year’s Budget statement in February. If you were in position to revamp or tweak this approval process for using our reserves, how would you go about doing it?
Kum Hong: As Minister Tharman says, there is a fundamental disagreement in philosophy between the PAP/Government and folks like myself - they place their faith in good men, while we would prefer a sound system (ideally, populated with good men!). So that is the difference. The PAP’s approach allows for the opacity and non-transparency that currently exists, but it presupposes and assumes that the people in the system are honest and trustworthy and, more importantly, will always remain so. I would prefer not to do things on the basis of that assumption being eternally true.
In terms of how I would go about doing it, I think it would be fully transparent, with the Government having to publish fully reasoned arguments for using the reserves, the Council of Presidential Advisers publishing full and complete reasons for their recommendation, and the President publishing full and complete reasons for his/her decision whether to give approval. Even if you accept that the secrecy around our investments and reserves is justified, it is hard to see how publishing all these decisions and reasons around the use of our reserves could be prejudicial to anything.
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