Malaysia’s “balanced growth” better than Singapore’s “higher growth”? (Part 2)

In Part One, I touched on jobs and re-employment of older workers. I shall now move on to public housing, the pension scheme, and healthcare.

Public Housing

The PAP promised in its 2006 Manifesto to:

  • Give them (lower-income Singaporeans) more help to buy their homes and build up their assets for their retirement, through the Additional CPF Housing Grant Scheme (ACHG)
  • Upgrade our HDB housing estates

I would like to point out that since then:

  • Approvals of HDB flat dwellers given financial assistance because they could not pay, disappeared from HDB’s 2005/2006 Annual Report onwards.
  • HDB loans in arrears over three months declines from 33,670 in September 2008, to 26,000 in June 2010, despite Singapore’s worse recession in 2009?
  • New HDB flat prices always increase more than the increase in the ACHG.
  • HDB resale prices rose about 75 per cent over the last five years.
  • 2,200 Selective En-bloc Re-development (SERs) flats and other non-SERs flats (number unknown, such as former Jurong Town Corporation (JTC)) were rented to foreigners, when thousands of Singaporeans wait years in the queue for HDB rental flats
  • Number of homeless in Singapore picked up by the Ministry of Community Development, Youth and  Sports (MCYS) doubled in 2010, compared to 2009.
  • HDB continues to refuse to disclose break-down of costs of building flats – 2009′s HDB annual report had its  largest deficit ever of S$2, because under its Market Subsidy Pricing policy, the more flats it builds and sells, the more money it loses.

The Malaysian Government has done much to ensure poor people have access to a roof over their heads by implementing numerous low-cost housing schemes. In Malaysia, public housing start from around RM25,000, against the cheapest 2-room HDB (1 bed-room) from around S$105,000 (RM250,000). Malaysia’s Deputy Prime Minister Muhyiddin Yassin announced on 24 October, that the Malaysian federal government has allocated RM180 million to build the first ever People’s Housing Project in Kelantan, comprising 1,500 units, for the benefit of the poor and those in the low-income group.


The PAP promised in its 2006 Manifesto to:

  • Top-up the CPF retirement and Medisave accounts of older citizens

Since then, CPF policy was changed without any announcement in media or Parliament – “property pledge” rule at 55, will no longer enable those who automatically pledge property to withdraw more money at 55, as the “property pledge” will only cover the CPF Minimum Sum (currently S$123,000) shortfall.

Only 60 per cent of active CPF account holders are estimated to have at least S$67,000 at age 55, when the new compulsory CPF Life Scheme kicks in from 2013.  25 per cent of active CPF members with less than S$40,000 at age 55, will be excluded from the scheme. How many inactive CPF members are there?

CPF savings left unclaimed for six months upon the CPF member’s death will receive the lower 2.5 per cent interest, instead of the higher four to five per cent in the Retirement, Special and Medisave accounts.

CPF members included in CPF Life, will no longer be able to withdraw at least a minimum monthly payout to enable the member to survive regardless of the account balance, as the payout will in future be solely determined by the life annuity payout monthly amount.

CPF Minimum Sum had been raised to S$123,000, and Medisave Required Amount raised to S$27,500.

CPF has been partially restored from 34.5 to 35.5 per cent, but the increase will go to the Medisave and Special Accounts – So, no increase in disposable cash income.

CPF withdrawal rule at 55 was reduced from 50 to 20 per cent, and will continue to decrease at 10 per cent per annum, until it becomes 0 in 2013. Malaysia’s Employee Providend Fund (EPF) withdrawal age is still at 55.

Temasek and Singapore Government Investment Corporation (GIC) had returns of 18 (S$ terms) and 7.9 (US$ terms) for the last 33 and 20 years respectively, whereas CPF Ordinary account interest is only 2.5 per cent –  the CPF Board transfers CPF funds to the Government in exchange for non-marketable Government bonds that match the 2.5 and 4 per cent interest on CPF accounts

In contrast, Malaysia’s EPF interest rate has ranged from 4.25 to 8.5 per cent historically, and was 5.65 per cent in 2009.


The PAP promised in its 2006 Manifesto to:

  • Provide affordable healthcare to all
  • Make hospitals more efficient so that they can keep charges affordable
  • Continue to subsidise lower-income Singaporeans who fall sick

The number of hospital beds in Singapore, has hardly changed –  from 11,742 to 11,663, from 1999 to 2009, against a population growth from 3.96 to 5.08 million and medical tourists to Singapore growing to 646,000 in 2008.

48 per cent of Medisave withdrawals in 2009, were to pay for CPF members’ dependants’ medical expenses. What this means is that the current generation is already using up a lot of their Medisave for other generations – in healthcare funding terms, this may be what many countries fear most and try very hard to avoid – that the current generation is paying for older generations and depleting their own healthcare funding in the future

In Malaysia, under the EPF health withdrawal scheme, members are allowed to withdraw money from their Account 2 (30 per cent of total contributions) to pay for the medical cost of critical illnesses suffered by themselves or dependents who are approved by EPF. The list of critical illnesses for the health withdrawal scheme was expanded on 15 June, to cover 39 illnesses, from 13 previously.The illnesses included apalastic anemia, blindness, kidney failure, Parkinson’s Disease, total permanent disability, leukemia and intellectual impairment due to accident or sickness.

Class C hospital bills increase by as much as 100 per cent, with statistics provided by MOH showing that average surgical bills have increased by at least 50 per cent at six out of the seven public hospitals

CPF Medishield insurance premiums and medical costs keep increasing to wipe out in a rather short time, any Medisave top-ups for the elderly.

28,500 Primary Care Partnership Scheme (PCPS) needy elderly Singaporeans only received $1.2 million of subsidy funding from MOH to General Practitioners (GPs) in 2009.

Auditor-General’s Office (AGO) flagged in 2010 the rampant practice of nursing homes eating up their residents’ Government payouts like GST credits without even asking for their consent because of acute insufficient funding.

Doctors, nurses and staff of healthcare group running Polyclinics, continue to raise funds every year for needy patients who cannot afford Polyclinic fees, because Medifund cannot be used to help pay for Polyclinic fees. In this connection, the latest Medifund annual report said that it had a surplus of $10 million, which will be transferred to the protected reserves after the next elections. The cumulative Medifund surpluses transferred to the protected reserves over the last two elections was $76 million.These two amounts in total could have provided about 8.6 million free polyclinic visits to needy Singaporeans, over the last nine  years.

In Malaysia, the lowest consultation cost at a public clinic is RM1, whereas in Singapore Polyclinics (public clinics), the lowest cost start from about S$10. Presumably, when Singapore separated from Malaysia in 1965, the cost of medical treatment at public health providers were about the same. So, why is it that lower-income Singaporeans have to pay about 24 times now for the most common basic medical services?

In 2005, about 18 per cent of Singaporeans in one ethnic community were in credit debt due to medical fees.

Countries like Malaysia and Thailand have free treatment for HIV patients, but not in Singapore, where HIV treatment costs start from about S$1,500 a month

Singapore’s public GDP spending on healthcare at about one per cent, is one of the lowest in the world. In contrast, I understand that Malaysia spends about 2.2 per cent.

Hospitals and Community Hospitals receive funding based on a complicated system of average costs depending on the number of patients for each and every different type of illness or procedure, and also on a needs basis arbitrarily determined by the Ministry of Health (MOH).  So, when you are told the subsidy is say 80 per cent for class C, actually perhaps nobody knows exactly how much for sure?

Means Testing implemented – those earning over S$3,200 will pay more in subsidised C and B2 hospital wards. Means Testing is also implemented for Community Hospitals.

There is no means testing in Malaysia.

Singaporeans’ foreign spouses and dependants’ medical costs in Class C hospital wards increase by 400 per cent, and Singaporeans’ PR spouses’ increase by 75 per cent (100 per cent by July 2011).