Wednesday, 20/9/2017 | 5:33 UTC+8

2015 Singapore’s election may be the most interesting

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Singapore’s ruling party appears set to keep an unbroken 56-year grip on power, but Friday’s general elections could be the most interesting yet.

For one, all of Singapore’s Group Representation Constituencies (GRCs), essentially the election districts, will be contested for the first time in the country’s history. Historically, if a district wasn’t contested, its residents didn’t vote, meaning many Singaporeans will be getting their first chance to vote.

“I didn’t get a chance to vote in the last election,” said one 33-year-old Singaporean who declined to be named. “I didn’t want to miss the opportunity again,” he added, noting that he delayed a pre-planned trip at the cost of 150 Singapore dollars (around $106) so that he could vote.

The latest elections will also be the first polls since the death of Singapore’s founding father, Lee Kuan Yew, who oversaw the country’s shift away from export manufacturing to a high-value services and investment-driven growth model crucial to Singapore’s transformation into one of the region’s few first-world nations.

The ruling People’s Action Party (PAP) is widely expected to win the polls, driven partly by the wave of nostalgia that followed Lee’s death as well as grand celebrations that accompanied the 50th anniversary of Singapore’s independence. But PAP will be battling a reinvigorated opposition that has used social media to bring their messages directly to Singaporeans, rather than have them filtered through largely state-controlled media outlets.

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People’s Action Party (PAP) supporters prepare LED banners for their night rally on the final day of campaigning on September 9, 2015 in Singapore.

Of particular interest to observers will be the vote share. The PAP’s share of the vote slid to its lowest-ever at 60.1 percent and the opposition parties won a record six seats out of parliament’s then total 87 during the 2011 election.

“A 60 percent vote last time for the ruling party, people would say from an outside view, ‘Wow, that’s still amazing,’ but it was the lowest percentage that the ruling party had in history and that will be the test today,” Curtis Chin, Asia fellow at the Milken Institute, told CNBC. “What we need to look at is the trend. .. how are Singapore people assessing what is their life like here.” He said the vote is “absolutely a defining moment.”

Further declines may well steer the government to a more populist stance. It isn’t clear yet whether the PAP will be able to regain lost votes.

“The patriotic fervor that the party seems to be relying on is not likely to boost its vote share by much,” said Navnita Sarma, Asia editor at the Economist Intelligence Unit (EIU), said in a statement Wednesday. But the EIU expects the opposition parties’ parliamentary representation will increase only slightly, with the PAP to retain or gain a slightly higher share of the popular vote this time around.

Because Singapore prohibits polling after the announcement of an election, there’s not much of a gauge of voter sentiment beyond analysts noting high turnouts at campaign rallies.

The PAP may get a boost from co-opting some of the opposition playbook since the last election — something the opposition party Singapore Democratic Party (SDP) highlighted on its website, claiming the ruling party first criticized its proposals for a minimum wage, universal healthcare and a “Singaporeans first” employment policy, before adopting versions of them.

The major issues dominating this election cycle include a stalling economy, immigration, the social safety net — including concerns over healthcare and the retirement-savings program known as the Central Provident Fund (CPF) — property prices and concerns about government accountability.

Economy

The growth outlook for Singapore’s export-dependent economy is looking cloudy. The economy contracted a sharp 4.6 percent on-quarter in the second quarter and rose a feeble 1.7% from the year-earlier period.

“External headwinds have intensified amid the uncertainties in the global environment,” DBS said in a note Wednesday, cutting its headline gross domestic product (GDP) forecast for the year to 1.8 percent, below the official forecast of 2.0-2.5 percent.

Calling Singapore’s economy a “small boat in rough seas,” it sees chances of a technical recession in the third quarter amid slowdowns in both the manufacturing and service sectors.

Immigration

Anger over a surge in immigration, which pushed the island-nation’s population up by over a million people since 2006 to more than 5.4 million last year, was partly to blame for the PAP’s struggles at the polls in the last election. Publication in 2013 of a plan to increase the population to 6.9 million by 2030 was also unpopular.

The population increase spurred another issue that angered many Singaporeans: crowds on public transportation. That can also be a key opinion driver. After a several disruptions of the subway system in July, satisfaction with the government fell around 4 percentage points to 76 percent from an April peak touched after Lee’s death, according to a regular survey by Singapore-based Blackbox Research.

Since the 2011 election, the government has taken steps to address some of the concerns, tightening rules on hiring foreigners, including requirements that employers consider Singaporeans for some jobs before approving work passes.

But concerns over the number of foreigners in the country remain a talking point in this election. In its 2015 manifesto, the opposition Workers’ Party cites a desire to maintain a “Singaporean core,” particularly by focusing on increasing the country’s birth rate, while holding the number of foreign workers steady.

Safety Net

Concerns over healthcare and retirement savings also dogged the PAP in the last election.

In an effort to address some of the healthcare concerns, the government will begin universal health insurance for Singaporeans and permanent residents beginning in November. The program will charge higher premiums — sometimes more than double the existing government-provided insurance program — but will offer more coverage and subsidies for those with lower incomes.

But the government has resisted some opposition calls for universal healthcare.

“There is no way of giving something to everyone … without raising taxes on the middle-income group,” Tharman Shanmugaratnam, the deputy prime minister, said in a recent speech which was posted on the Facebook page of Prime Minister Lee Hsien Loong, who is Lee Kuan Yew’s son.

The country’s mandatory retirement savings plan, the CPF, is also a continuing concern for some Singaporeans. The government’s moves to increase the minimum age for collecting the funds, in line with life expectancy increases, and to increase the “minimum sum” which must be set aside as an annuity have proved unpopular. The interest rate paid on CPF savings — which currently ranges from 2.5 percent to 4.0 percent — is also a point of contention. That comes in above Singapore’s consumer price inflation, which fell 0.4 percent on-year in July.

“Even if it was a 6 percent return, this is nothing to shout about,” opposition party National Solidarity Party candidate and acting secretary-general Lim Tean, a legal consultant, said according to the party’s Facebook page. “If the government really cared for its people, it will be returning you better returns on the CPF.”

He has called for a 15 percent return on CPF funds, according to a report by Today newspaper.

By comparison, Singapore’s 10-year government bond is currently yielding around 2.8 percent. The return of the U.S. Social Security program — which unlike the CPF’s defined-contribution model is a defined-benefit plan — was estimated at around a 6.5 percent at its best at the end of last year.

Property prices

Runaway property prices have typically been a hot topic ahead of general elections. But this time around, housing prices are on the wane after around four years of cooling measures from the government and as expected supply completions begin outstripping demand. But after years of price increases, voters still aren’t pleased.

“Tighter mortgage lending standards and curbs on foreign purchases, along with slower immigration, have pushed down housing costs,” Daniel Martin, an economist at Capital Economics, said in a note this week.

Government accountability

After so many years of one-party rule, many are concerned about government accountability and transparency — especially as politicians’ salaries remain among the highest globally, spurring accusations that they are out of touch with ordinary Singaporeans, particularly on income disparity.

The prime minister’s annual salary earns around 2.2 million Singapore dollars ($1.56 million) a year, the highest earning country leader globally, while members of parliament were paid around 192,000 Singapore dollars a year in 2012, according to media reports.

Singapore’s median gross monthly income was around 3,770 Singapore dollars a month in 2014, according to government data.

“A diverse parliament is critical in assisting the executive to make sounder judgments about policy trade-offs,” the opposition Workers’ Party said in its manifesto. “A parliament monopolized by one party fails the test of rigorous debate and voting in forging sound policies.”

Others are more blunt: “The PAP has an overwhelming majority in parliament. So do we need another person to vote yes to the PAP’s policies,” asked Jeannette Chong-Aruldoss, a candidate for the opposition Singapore People’s Party, in a Sept. 6 speech posted on Facebook.

While the voting in Singapore is considered free and fair, the ruling party has in the past taken extraordinary steps to push voters away from choosing opposition candidates, including withholding funds for upgrading public housing projects in districts which don’t vote for the PAP; around 80 percent of Singaporeans live in public housing projects.

Source: Nyshka Chandran contributed to this article – cnbc.com

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