Saturday, January 31, 2009

Give your views on budget 2009

How do you feel about the budget 2009?
Read the survey results.
The average rating from 95 respondents are:
a) The budget is good for business (rating 3.78)
b) The general election will be called in 2009 (rating 2.97)
c)  The average rating for the other questions are lower than 2.66. 
A rating of 3.0 is neutral. A rating below 3 indicates that more people disagree with the statement, compared to those who agree.  
On the whole, the respondents are less confident about the benefit of the budget for the people, in saving jobs, in spurring economic recovery or helping the unemployed. There is also a negative level of confidence in the leaders.
The ratings are similar across age groups. The employed have a slightyly higher level of confidence, compared to business and the unemployed/retired.


Anonymous said...

Nothing comes for free.

Be prepared for a significant fall in the value of the Singapore dollar.

C H Yak said...

I believe the sampling of this survey is representative of the population, due to the nature of this survey and data collection. At a cursory glance, survey results should be highly reflective.

The results indicates that it is too business-centric.

The general public do not expect much from the budget personally.

Despite being radical in approach and presentation, whether the Budget actually helps the average Singaporean to keep his job remains to be tested. At this point, it is still only theory.

From my real experience, foreign MNC are seldom buy-in by the Government's selling of healthy tripartism amongst Government, Employers & Union (workers). When they need to retrench, they will retrench. Whether or not there is a CPF cut, or indirect Government subsidy of wages through training grants, this is immaterial. Even retrenchment benifits would still be an issue due to unclear legislations. Whether employment contracts cater for this is highly dependent of respective HR practices.

Anonymous said...

Lim Swee Say as head of the workers movement must robustly champion the workers' interest within the tripartite. In what is supposed to be a rescue package ultimately for the benefit of workers and the people of Singapore, it turns out that companies turn out to be the main direct beneficiary getting the lion's share of the $20.5 billion help package. As sure as the sun rises, companies will still fold, workers will still lose jobs or suffer pay cuts. To these workers, the money which will go to the companies will have no benefit to them.

Not by any measure is he, as supposedly the workers' champion, justified to declare full satisfaction with the direct allocation to workers and to those who will be retrenched. Why didn't he tell the public that he had fought for a bigger direct share for the workers, even if he failed to get his bosses, oops I mean the other members of the tripartite, to change their minds.

Do you notice that with all the distractions of the recession and the help budget, the govt. has opportunistically sneaked in an increase of almost $1000 million to the security (defence and home affairs) budgets, bringing the Defence and Home Affairs Budgets to historical highs of over $11.4 billion and $3 billion respectively. This is one of the real reasons (quietly though) why our past reserves have to be used for this year's budget.

The Defence spendings tower above every other budgetary spendings. This, despite the gloomy outlook for the next 24 months or more. Money should be conserved (and channeled to fund more direct people-help programs, say, for retrenchment benefits). Some military spendings could surely be postponed or paced out until better days come back. It is not as though we are under-invested in defence. After years and decades of heavy military spendings, we have as of now already the most invested and equipped armed forces than the rest of ASEAN combined. That betrays the under-emphasis on real care and focus this govt has on people-related needs vs. growth and power.

The rating of “best” for this Budget is I think mainly based on the huge total amount of help programs. But if you look at the measurable benefits that will land in the hands of Singaporeans, then “best” is somewhat an overstatement. Let me say why:

1. The direct help for individuals & households amount to less than 13% ($2.6 billion) of the total. 66% ($13.5 billion) is given directly to companies. Past reserves are accumulated savings and wealth of the nation and hence of its citizens. If the reserve vault is to be opened, the direct benefits should be skewed for more to go to them instead of to companies. The $2.6 billion allocated represent only a modest increase over similar (such as GST refund, Workfare) 2008’s pre-recession and pre-hyperinflation help-budget. The stated justification for the huge allocation to companies is that individuals will be the beneficiaries of the help programs through jobs saved. The problem is the extent of leakages in this flow-down effect to individuals as huge number of jobs in aggregate is still projected to be lost despite these help programs.

2. Citizens are subject to various forms of means testing for programs such as the hospitalisation subsidies and share of workfare payouts. On the other hand the Job Credit program gives money from our reserves to all employers, regardless of whether they are financially strong or weak, big or small, earning big profits or suffering losses. If we citizens are subject to means testing, why is the govt. so generous without setting criteria to pre-qualify companies to be entitled to this particular. Banks, large property developers, large GLCs, most MNCs and govt ministries do not deserve nor need this financial subsidy to continue to be viable. Public reserves should not be used to enrich private enterprises, particularly the healthy ones. Mind you, these companies have logged in bonaza profits in the past years, and even if they will performance not as well in the near future, they will still make reasonable profits without Job Credit program.

Companies drawing on wage subsidies are not obligated to refrain from cutting jobs, cut pay or put employees on no-pay leave, if down-sizing is needed to ensure survival. So reserve money will drawn down and many workers will still get fired as the recession spreads and intensifies. If there is some form of means testing on companies, money saved can be used instead for another program to help individuals directly, say, for the retrenched whose jobs are not saved or the retired/aged with little income or have fixed income and are weighed down by the increased cost of living from last year’s inflation.

3. Even without the benefit of the Job Credit program for these healthy companies, the other numerous programs, taxes cuts/rebates and training subsidies/allowances, are still available to them and all other companies.

4. The bottom line is that although the help programs are declared to be ultimately to help the citizens by saving jobs, individuals will actually be getting the much shorter end of the $20.5 billion. More could also be done to help ease their cash-flow tightness, for example waiving or reducing GST on essential goods and services at least during these hard times or allow a small portion of a retrenched worker’s CPF savings to be withdrawn to tide him over while he seeks for new employment (by the way CPF is the worker’s own money and not even a subsidy).

That’s why I think this pro-company help-budget falls short of being BEST because it under-performs for the individuals.

Anonymous said...

Anyone know that the job credit package will benefit for how many covt's companies and how many pte companies?

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