Doomsday Scenario: What if the Singapore Government shuts do

[Ah_Zai]

 

The government shutdown in the United States is into its second week with no end in sight.

Whether a civil servant forced into no-pay leave, a war veteran missing his monthly disability cheque, or a patient with cancer on a state-funded clinical trial, the refusal of Congress to open the federal purse has had far-reaching effect in the lives of ordinary Americans.

From across the Pacific, what is unfolding in the US may seem like the sort of hellish political dysfunction that would never touch our sunny shores.

But a Singapore Government shutdown is - though extremely unlikely - not impossible. In fact, imagining it illuminates the quirks of this little red dot’s system of government: most schoolchildren would have to stay home, for example, but not researchers.

The Housing Board hotline would be closed, but not the Town Council’s. Construction of the new MRT lines would screech to a halt, but the trains would keep running as they are operated by publicly-listed companies.

The scenario in which the Singapore Government could shut down would begin with Parliament refusing to pass the Supply Bill, which is the Government’s planned expenditure for the year.

This is exceedingly rare in Westminster systems as the majority party in Parliament forms the Cabinet, unlike in the US. It is even more unlikely in a unicameral system like Singapore’s - as there is no Upper House or Second Chamber to block legislation.

But a backbench revolt or a split in the ruling party could occur, or, one partner in a coalition government could refuse to support the Spending Bill. These might give opponents enough votes to defeat the Government’s Budget.

The People’s Action Party’s is currently so dominant that the prospect of a coalition government is almost fantasy, and the last time there was a split in the ruling party was back in 1961. But the Constitution has laid out rules for every eventuality.

It states that if Parliament does not pass a Supply Bill, the Finance Minister may take money from the Government’s Consolidated Fund, where all its revenue accrues. It is currently at $206 billion.

But he can take only up to a quarter of the previous year’s Budget. Essentially, the government can keep going for only three more months.

This is designed to tide the country through a General Election. The failure to pass a Supply Bill is by convention equated to a vote of no-confidence in the Government. That is, the Prime Minister should get the hint and advise the President to dissolve Parliament for elections to be held.

If he remains intransigent and refuses to do so, the President can actually unilaterally declare the seat of the Prime Minister vacant, and appoint someone else in his place who would call for elections. This would be a way out of the impasse.

It would only be in an uncanny string of events - Parliament defeats the Budget, the Prime Minister refuses to resign, the President does not act, and this stand-off goes on for more than three months - that a Singapore government shutdown occurs.

Implausible and incredible, perhaps, but not impossible.

So what of ordinary Singaporeans faced with a shutdown? The good news is that the national life may actually be disrupted less severely than expected.

Yes, tens of thousands of civil servants would be furloughed, which is to be essentially forced into no-pay leave. But due to two entrenched quirks of the Singapore system - decentralisation and endowment funds - much will keep running.

Take the Town Councils, which were established in 1989 for HDB towns to be managed locally. They are largely funded from service and conservancy charges paid by residents, and maintain their own finances and operations.

The Government gives the Town Councils a yearly grant of 15 per cent of their total incomes each year. Chua Chu Kang town council chairman Zaqy Mohamad says that this is not a big enough sum to affect daily operations in the event of a state shutdown that would hold back the money.

So, the trash will still be collected, the void decks still washed and the blown lightbulbs still replaced. What may be put on hold would be longer-term projects like lift upgrading and re-roofing.

Even then, each Town Council can vote to tap into their reserves, known as sinking funds. Given that these are in the tens of millions, crises should be averted.

Such decentralisation is also entrenched in institutions that the Government supports like public hospitals.

It gives them a lump sum every year - an estimated $2.8 billion this financial year - to subsidise the treatment of lower-income patients.

But otherwise, the hospitals are run like private institutions, collecting fees from unsubsidised patients and paying doctors and nurses themselves. They also have private patrons and endowments funds which would likely be tapped on in the event of a cutback in government transfers.

This is also the case for Independent schools, which means that not all children would be stuck at home in the case of a shutdown.

Still, their operations would have to be rolled back, and staff may have to work for no or less pay. But there are several areas of Government spending that would literally not be impacted by a shutdown at all, thanks to the creation of endowment funds.

Much has been made in the US of state-funded clinical trials having to turn away kids with cancer due to the lack of funding.

This would not happen in Singapore: The Cancer Science Institute of Singapore is one of five research centres funded by the $3.4 billion National Research Fund, which would be unaffected by Parliament’s failure to pass a Spending Bill.

Other people to escape unscathed: low-income families getting cash assistance from the $1.3 billion Comcare fund, senior citizens re-skilling through the $3.8 billion Lifelong Learning Fund, and every holder of a Singapore Government bond, known as Singapore Government Securities (SGS).

A debt ceiling crisis of the sort looming over the US would literally never happen here, because Singapore doesn’t rely on borrowing to fund its spending.

But it doubly could never happen here because of the $389 billion Government Securities Fund that has been squirrelled away. That is, if every SGS holder wanted to encash his bond today, the cash to pay them all is in this fund. Singapore is a country that always pays her debt.

All of these safeguards may add up to surprising upside to a government shutdown. The glaringly-obvious bad news? Such a scenario would put Singapore in a tiny group of countries which have failed to govern themselves.

Among developed countries, this group numbers two: the US, and Australia in 1975.

Investor confidence would disappear overnight and the whole economy could well enter a downward spiral. Even if some of daily life were to go on as this thought experiment has shown, the signal would be that Singapore “cannot get its act together” - as Prime Minister Lee Hsien Loong said of the US on Tuesday.

And that would be a devastating, near-fatal, blow.

 

Source:

 

http://www.singapolitics.sg/views/what-if-singapore-government-shut-down

Edited October 11, 2013 by Ah_Zai

[Maxus-MIFA9]

Hmmmm............ I need a long break without affecting my leave ...

[Jman888]

Hmmmm............ I need a long break without affecting my leave ...

 

 

can, take unpaid leave lor

[Maxus-MIFA9]

 

 

can, take unpaid leave lor

 

Why cause to much problem to apply unpaid leave where only you can go off.....

 

They shut down, whole office kaki can go Kukup fishing village to enjoy ...

[Knoobie]

why do I feel that this article is like warning Singaporeans that if we voted more opposition into the parliament it will have the potential of causing the shutdown in Singapore?

 

was it just me??

[Karu]

why do I feel that this article is like warning Singaporeans that if we voted more opposition into the parliament it will have the potential of causing the shutdown in Singapore?

 

was it just me??

 

Another journalist trying to score some points...