SINGAPORE - The timing of recently announced tax and fee hikes was called into question by a Non-Constituency MP in Parliament on Wednesday (Oct 14).
Speaking during the debate on the Government's Covid-19 strategy, the Progress Singapore Party's Leong Mun Wai said it is contradictory for the government to be raising consumer costs while pledging support measures, and questioned if the national coffers were truly being overstretched.
He cited a recent two-week period where cost increases were announced.
On Sept 29, it was announced that MediShield Life premiums will increase between 11.5 per cent to 35.4 per cent from early next year. That means an increase in the annual premium from $1,000 to $1,350, said Mr Leong.
The increased coverage that comes alongside the premium hike is "scant comfort to Singaporeans who are still struggling with the financial woes of Covid-19", said Mr Leong.
On Sept 30, SP Group announced a 9.3 per cent electricity tariff hike for the last quarter of this year, from October to December.
"Here is a power-grid monopolist which does not generate electricity, but made billions of dollars since the liberalisation of the electricity market in 2012, sparing no time in raising prices at the first available opportunity, even as Singaporeans struggle under the Covid-19 crisis," he said.
While the price increase is due to the higher costs borne by the power generating companies, Mr Leong said "SP Group could have easily absorbed the increase from the past profits it has earned instead of passing the increased cost on to consumers".
"The Government does not inspire confidence by hastily increasing taxes and fees while at the same time pledging Covid-19 support measures. Our population could view this act as 'giving with one hand and taking with the other'," said Mr Leong.
Mr Leong also noted that the Land Transport Authority (LTA) said last week that Electronic Road Pricing (ERP) rates at six gantries along the Central Expressway (CTE) would be increased by $1 from Oct 12 to ease peak period congestion.
These announcements add hundreds of dollars to household expenditures of average Singaporeans, and raises concerns such as whether the goods and services tax will be increased soon after 2021, said Mr Leong.
He asked: "Can these hikes not be shelved till later? Can SP Group not absorb the tariff increases with their past profits? Can't ERP increases wait? Can't premium increases be deferred for a period of one to two years, as the current insurance claims are still way below the collected premiums after all?"
In his speech, Mr Leong also said that while the Government does not want to disclose the size of the national reserves for security reasons, it has published detailed annual financial information on Singapore's assets and liabilities. "In its latest Government Financial Statements as at end March 2020, it was reported that we own a total of $1.35 trillion in financial assets," he noted.
Taking into account the Net Investment Return Contribution - the returns from investments made using Singapore's reserves - Mr Leong said the decrease in Singapore's financial assets is $14.8 billion, which means "we have used up only 1.1% of our total financial assets to fight the Covid-19 in 2020".
"It appears that there is no need for the tax and fee hikes to take place so soon," he said.
Mr Leong called for a review of safety net policies like the MediShield Life and HDB flat lease, to build Singaporeans' confidence in facing economic challenges and develop creativity, innovation and entrepreneurship.
"The Government's role should be restricted to being a facilitator and custodian of our funds, but the actual work of building our future economy should be left to entrepreneurs and experts in different fields from the private sector," he said.
