Tuesday, March 22, 2005
New scheme for HDB shops underlines disturbing trend
Earlier this month, Minister for National Development Mah Bow Tan announced several new policies in Parliament, one of which is the Restructuring Programme for Shops (RPS).
This programme is targeted at shop tenants where there is an over-supply of shops and where business is poor. Shop tenants in a cluster selected for the RPS will be polled on whether they wish to retire from their business. If more than 50 percent of the tenants in a block opt to quit, those who opt to quit will receive $60,000 while those who did not will be given HDB assistance to relocate.
Some responses on the scheme in Channel NewsAsia:
Ownership of a small business represents, for many people, an alternative avenue for making a living — one that does not tie them to the corporate world, affords them some freedom and provides a back-up for employees who cannot get or keep a salaried job. In a sense, it represents economic egalitarianism.
The HDB shop is an important symbol of the small business owner. But it looks like many retail shops in Singapore’s heartland have difficulty staying economically viable. This is not surprising; in the United States, large retailers like Wal-Mart are driving smaller ones out of business as well (see “The Darwinian world of retailing”). Unfortunately, the government’s plan to remove the 30 percent rental rebate for HDB retailers only makes things worse for the latter.
These developments indicate that the door may be closing on one alternative for people to own their own business. All this while the world may be facing greater income insecurity (see Brad DeLong’s recent post “Daniel Gross on Social Security and Income Insecurity”) and Singapore itself sees a possible slowdown in hiring. The RPS notwithstanding, this may mean more frustration for people trying to earn a living in Singapore.
This programme is targeted at shop tenants where there is an over-supply of shops and where business is poor. Shop tenants in a cluster selected for the RPS will be polled on whether they wish to retire from their business. If more than 50 percent of the tenants in a block opt to quit, those who opt to quit will receive $60,000 while those who did not will be given HDB assistance to relocate.
Some responses on the scheme in Channel NewsAsia:
Mixed response from shop tenants on Restructuring Programme for ShopsAnd in Today:
The Restructuring Programme for Shops could provide a vital lifeline for struggling shop tenants as the new scheme aims to minimise oversupply of shops and improve business by offering them a way out. But not every tenant was keen.
Jessica Yeo, who operates a skincare centre along Mei Ling Street, was one of many who welcomed the Restructuring Progamme for Shops... Yet others like Janice Chan want to stay put despite sluggish sales...
Lifeline heartens HDB shopownersWhile it may need some refinements, I think the concept behind RPS is a good one. It gives retailers who are not doing well a way out, while for those who choose to remain in the business, it helps to reduce competition and keep them viable. But I think it also reflects a disturbing underlying trend.
IT would not be wrong to call the Government’s new rescue package for beleaguered heartland retailers a scheme of half-measures, say some observers.
After all, the Restructuring Programme for Shops (RPS) requires a voting majority of just over half to take place, helps less than half of Singapore’s 15,200 HDB shop units and co-funds up to half of business revitalisation projects.
But what some say are half-measures is seen as help by others, which begs the question: Is the glass of the HDB retailers half-empty or half-full?...
Ownership of a small business represents, for many people, an alternative avenue for making a living — one that does not tie them to the corporate world, affords them some freedom and provides a back-up for employees who cannot get or keep a salaried job. In a sense, it represents economic egalitarianism.
The HDB shop is an important symbol of the small business owner. But it looks like many retail shops in Singapore’s heartland have difficulty staying economically viable. This is not surprising; in the United States, large retailers like Wal-Mart are driving smaller ones out of business as well (see “The Darwinian world of retailing”). Unfortunately, the government’s plan to remove the 30 percent rental rebate for HDB retailers only makes things worse for the latter.
These developments indicate that the door may be closing on one alternative for people to own their own business. All this while the world may be facing greater income insecurity (see Brad DeLong’s recent post “Daniel Gross on Social Security and Income Insecurity”) and Singapore itself sees a possible slowdown in hiring. The RPS notwithstanding, this may mean more frustration for people trying to earn a living in Singapore.
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