Rather than Cyber Bully Ordinary Citizens, the Minister of Finance Needs To Be Transparent About Temasek, GIC, Our Reserves and the PM’s Wife’s Pay: An Open Letter to Heng Swee Keat
3 April 2020
Heng Swee Keat
Ministry of Finance
100 High Street
#06-03 The Treasury
Dear Swee Keat
It has been many years since we were together studying Economics at Cambridge. I hope that you and your family are staying safe and practicing social distancing during this unprecedented global crisis.
I am writing because of a POFMA notice issued by you against 超静’ (‘tifinnytara’) on 29 March. She may not have your advantages of having achieved a Second Class Honours degree in Economics from Cambridge University but much of what you single out as falsehoods is, if not completely, at least partially correct. You must surely agree that the distinctions are blurred. I note that she has now deleted her Facebook page. At this time of crisis, when many Singaporeans are anxious and cut off from family and friends due to the new measures announced by the PM this afternoon, was it necessary to terrorise an ordinary citizen and scare her so badly that she took down her Facebook page, thus increasing her isolation?
Your statement says that SIA’s $15 billion capital raising exercise is “not funded by the Government”. However, you are equivocating. Is Temasek not a 100% state-owned company of which your Ministry is the sole shareholder? If the answer to this is ‘no’, send me a POFMA or I will self-issue myself a POFMA to save you the bother.
If the answer is ‘yes’, please continue reading.
If Temasek has been sold to another Government or foreign company, then you need to let Singaporeans know. SIA’s fundraising is being completely underwritten by Temasek which is headed by the PM’s wife. When you say you “welcome” Temasek’s decision to support the airline, is that not a euphemism for saying that Temasek was directed to invest by its shareholder, the government? Can you prove that it was not by, for example, minutes of the Board meetings, press releases that I might have missed, etc.
Your POFMA also says:
The author also stated in the Facebook Post, “…president halimah open reserves of $17b is mainly for Temasek.” In this statement, the author has claimed that the S$17 billion from Singapore’s Past Reserves will be used mainly for Temasek Holdings (Private) Limited (“Temasek”). This is also false.
Agreed that this is more obviously a confusion and that the author may have made unjustified assumptions. However, is it not true that Government owned or affiliated companies, as major if not the major employers in Singapore, will be beneficiaries of your $17 billion Resilience Package through the Jobs Support Scheme and property tax rebates. Government ownership includes companies or start-ups owned by or invested in by Temasek, GIC and Changi Airport Group as well as corporatized entities such as SingHealth and statutory boards like HDB.
Is it also not true that using the widest definition the Government accounts for over a half to as much as two-thirds of economic activity in Singapore, either directly or indirectly? I have also not included major businesses or non-profits owned by or affiliated with your party, such as NTUC FairPrice and the PAP Community Foundation. NTUC FairPrice will also benefit from the $300 in grocery vouchers given to all Singaporeans living in one and two-room HDB flats.
It has been established by the courts that the Government has to prove the truth of what it is saying if it wishes to use the POFMA law. Therefore, before using heavy-handed and authoritarian laws to bully citizens who are forced to make reasonable assumptions and may come to misunderstandings in the face of your Government’s opacity, please provide figures which show precisely how much of the $17 billion is going to PAP or Government-owned and affiliated companies. Also, how much of the $20 billion in Government loans provided in the same Budget will be made to the same companies?
It is your Government’s deliberate culture of secrecy and refusal even when questioned in Parliament to answer basic questions like how much the PM’s wife is paid as head of a state-owned company and use of both archaic and new laws to silence questions and criticism that has resulted in citizens being forced to draw their own conclusions. Rather than invoking POFMA, your Government would serve the cause of preventing fake news if it was for once to be honest and transparent with citizens. Norway, by contrast, is completely transparent about every investment made by its sovereign wealth fund and how much the managers are paid. Passing a Freedom of Information Act, like the ones in the US, UK and other Western countries, would be a start.
It is a sad waste of MOF’s resources that time is taken up issuing unnecessary POFMA notices against individual citizens when your Ministry could be better employed dealing with the enormous challenges facing our nation.
“Is it also not true that using the widest definition the Government accounts for over a half to as much as two-thirds of economic activity in Singapore, either directly or indirectly? I have also not included major businesses or non-profits owned by or affiliated with your party, such as NTUC FairPrice and the PAP Community Foundation. NTUC FairPrice will also benefit from the $300 in grocery vouchers given to all Singaporeans living in one and two-room HDB flats.”
There is empirical evidence to this ‘conjecture’. Back in 2000, my team and I under the guidance and supervision of a certain Mr A Miranda, undertook a research effort to unearth the extent of SG Govt in the private sector, and how much of SG’s GDP is attributed to the Govt’s involvement. I wouldn’t bore you with too much details, but the methodology essentially, was to manually calculate through direct and cross-referenced shareholdings between networks of entities and assigning appropriate weights, share composition belonging to the Govt, in publicly listed companies and major private companies through their mandatory declarations and annual reports. The objective was to determine the percentage of involvement of Temasek and GIC in our local economy. We only used these two vehicles as starting points for simplicity, and firms like ST Engineering by definition, would have been accounted for at the 1st layer of shareholdings held by the Govt.
Our findings indicate a whopping 65% to 70% of direct and indirect involvement (through a myriad of subsidiaries) by the Government in our local economy, with a 95% CL.
Disclaimer: this research was done almost 20 years ago and no effort has been made to keep up with ongoing changes, so composition might have changed. This was purely an academic exercise with no political bias attached to it.
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THis is very helpful thank you!