The Singapore Commentator

Yesterday, the construction site at the Fusionpolis being built along Ayer Rajah Avenue collapsed, killing two construction workers. Steel beams in the lowest basement -- 25 metres below street level -- gave way, causing the collapse.

Officials have claimed that this accident is not related to the one at the MRT construction site along Nicoll Highway on 20 April. Still, the two accidents occurred just nine days apart, so one can't help wondering.

On 20 April, a Mass Rapid Transit (MRT) construction site along Nicoll Highway collapsed. So far, three men have been confirmed to have been killed in the disaster, with a fourth man still missing and presumed dead.

According to reports, repair of the highway will take about six to nine months. In the meantime, the Land Transport Authority is trying to shore up the surrounding ground to prevent further collapse before further repair work is carried out.

A committee of inquiry has been set up to investigate into the cause of the disaster. Certainly, there will be important lessons to be learnt. Not just to identify possible negligence and criminal liability, but also to prevent similar disasters in the future.

As though to emphasise the point I made last Sunday, The Sunday Times published a report today on homeowners who bought new houses and ending up paying for two mortgages because they could not sell their old houses.

The problem is that many people buy new houses thinking that they can easily offload their existing homes at good prices. It turns out that there are relatively few buyers in the market. Many homes can only be sold at a loss. The new houses that they bought at what seemed like bargain prices turns out to be not such a good deal after all, since their old homes have to be sold at similar bargain prices.

For these home-buyers, I say: Welcome to the new economic reality, where houses are no longer a good form of investment.

The Singapore government has, for some time, been trying to foster entrepreneurship in Singapore. Apparently, last week it succeeded in an unintended way.

According to a story in The Business Times today, on 16 April, the government portal for online procurement by Singapore's public sector, GeBIZ, started sending out pre-programmed email reminders to inform suppliers of the April 30 deadline for the payment of annual subscription fees.

However, a programming error caused 21 of the emails to have additional addresses unintentionally attached to them. As a result, 5,871 companies received the emails meant for the 21, and all 5,871 received each other's email addresses.

While some of the addressees were upset at the error, others took the opportunity to introduce themselves to the other addressees. "Soon, email solicitations for business were flying across the web," reported The Business Times.

According to the newspapaer, "a number of companies that spoke to BT viewed what happened as being, on the whole, a 'happy accident'. Wendy Wee, sales executive of a company that supplies audio-visual solutions, said: 'I am now linked to other suppliers and customers . . . It's a cool way to keep in touch.'"

A sales manager of a supplier of servers reportedly said that he managed to get new business leads as a result of emails that he sent out. Another said his business association "managed to link up with many companies as a result of the ready-made 'introduction service' provided by the email list".

That's true entrepreneurial spirit for you. I doubt, though, that it's the kind of role the government had in mind when it set itself the task of promoting entrepreneurship.

In the mid-1990s, speculation in property was rampant in much of Asia, including Singapore. Many people still seem unable to forget the prices of that era.

The Sunday Times today had a feature on retirees downgrading to free up funds for retirement. What caught my eye was a statement by Mr Sazali Sarwan, associate director of Propnex, who apparently told the newspaper that "those who bought their homes when prices were at their peak in 1996 and will face a loss if they sell, shouldn't consider downgrading".

To me, since prices of homes are already down from their 1996 peaks, the loss has already been made. Holding on may not help. Like it or not, a paper loss is a loss.

Propnex may think that prices will recover their peak levels soon. I doubt it. Home-owners who hold on to such a hope may have to wait a very long time, suffering opportunity cost in the meantime.

And for retirees, time may not be on their side.

The issue of civil servants needing to take more risks and promote market-friendly policies reappeared in The Straits Times Forum today.

There were three letters published on the subject, all the writers giving advice on how the civil service can become more willing to take risks.

However, in my opinion, only one letter really hit the nail on its head. The writer stated that administrators frequently find "exceptional factors...that make a mess of the predetermined rule. And they find it difficult to resolve the conflict". The ability of the system to "trust and support administrators in their decisions" -- in other words, to empower administrators -- is therefore important. Unfortunately, "bureaucracies, by nature, are not created with trusting their functionaries in mind".

And therein lies the problem. Empowerment and risk-taking are the exact antithesis of civil service governance. Checks and balances are set up in government to reduce the potential for abuse of power. Those same checks and balances tend to hinder all risky decisions.

The easiest solution to the civil service's conservatism is simply to reduce the government's role in national affairs. If the civil service is market-naive, then reduce its influence on the market. Let the market take care of itself.

However, Singapore has a government which prides itself in its ability to solve all problems and is notoriously intrusive as a result. While there have been calls by several ministers and government officials for lighter regulation and greater self-dependency on the part of Singaporeans, things are not likely to change dramatically in the foreseeable future.

Unfortunately, that means that the risk-averse culture of the civil service will continue to be a problem for the foreseeable future too.

The National Kidney Foundation (NKF) is one of the most successful fund-raising charity organisations in Singapore. That very success is now generating some controversy.

There are actually two complaints making the rounds in Singapore concerning the NKF. One is its tie-up with British insurer Aviva. The other is its accumulated reserves of $189 million.

NKF's deal with Aviva involves the former introducing potential clients from its database of donors to the latter. It will in turn receive $1 million each year over five years when these referrals result in sales. Donors have complained over the fact that they have no say over their participation in the scheme. The Consumers Association of Singapore has already indicated its unhappiness over the deal, suggesting that it should have been made an opt-in system instead.

With regards to the size of the NKF's reserves, the amount of $189 million is apparently enough to last the organisation three years. Most other charities surveyed by The Straits Times only have reserves that can last less than two years. Most people are already aware of the NKF's powerful marketing machine through its frequent fund-raising campaigns. The size of the reserves serves to confirm the perception.

The NKF chairman, Richard Yong, has already responded to the criticisms in a letter to The Straits Times. With regards to the deal with Aviva, he claims that donors particulars will not be disclosed to the insurer. And as for the reserves, the aim is to build up a sufficient buffer so that NKF's programmes are sustainable "for the unpredictable future", he wrote.

While I fully understand the public's criticisms of the NKF over both issues, I also sympathise with the NKF. As far as the Aviva deal is concerned, it happens to be an innovative way to generate additional funds without having to call for outright donations from the public. It is potentially a win-win deal for all parties. However, there is always a high potential for the implementation of such schemes to be imperfect and to leave a bad aftertaste in the public's mouth.

As for the reserves, the NKF is not wrong in wanting to build a substantial reserve. Public generosity cannot always be taken for granted, especially when times get tough. Again, though, the thought that one charity is hoarding most of the country's donated funds inevitably raises the question in the public's minds of whether other charities are being deprived of money.

The NKF's programmes provide important health and financial support for large numbers of Singaporeans. It definitely drives a worthwhile cause. It is unfortunate that its fund-raising activities have caused it to become embroiled in the current controversy.

Just like Singapore, Britain has tried to make the workplace more family-friendly.

Recently, the British government introduced new rules which allow parents with a child under six to ask employers for a change in working hours, day or location of work, provided they have been with the employer for six months.

According to a BBC report, the rules are not working out quite as some had hoped. A poll by Maternity Alliance found that found that while 68% of parents who asked had their request accepted, 25% were turned down.

Some parents had to accept a cut in salary or job status in order to secure some flexibility in their work.

Food for thought for those hoping for more flexible work arrangements to be introduced in Singapore.

When I first read in The Straits Times on Wednesday about Defence Minister Rear-Admiral (NS) Teo Chee Hean criticising public servants for being risk averse, lacking a good understanding of markets and not cooperating with other ministries, I asked myself, "Why is there a need for a government minister to publicly tell civil servants what to do? Shouldn't the government simply implement the policies and rules required to steer behaviour in the right direction?"

Of course, I quickly realised that the problem is that the government itself doesn't really know exactly how to effect the desired change. It is always easier to know the desired end result. Knowing how to get the result is another matter.

So in typical fashion, the government is tackling the problem by forming a committee called the Strategic Issues Group. Being a group, I wonder whether it will succumb to groupthink, and become itself risk averse.

The Straits Times followed up the subject today by asking several people for their response to the criticism. Some people reportedly simply cheered the move. The more insightful comments, I thought, came from businessman and MP Inderjit Singh, who pointed out that the reward and punishment system needs to be changed, and an anonymous civil servant, who said civil servants don't lack initiative, "but that people are made to conform to the system".

How true. Hopefully the Strategic Issues Group recognises the problem and finds the correct solution.