CPF interest rate for OA to stay at 2.5%-Yahoo! Singapore(News)

All Central Provident Fund (CPF) members will continue to receive a risk-free interest rate of 2.5 per cent on their Ordinary Account (OA) savings from 1 April to 30 June this year.

In a joint statement on Wednesday, the CPF Board and the Housing and Development Board (HDB) announced that the computed CPF interest rate worked out to be 0.16 per cent per annum.

CPF members will continue to receive a risk-free interest rate of 2.5 per cent on their OA savings from 1 April to 30 June this year. (Yahoo! photo)

It is derived from the major local banks’ interest rates for the three-month period from 1 November 2011 to 31 January 2012.

However, members will receive the higher rate of 2.5 per cent as legislated by the CPF Act.

In addition, an extra one per cent interest will continue to be paid on the first S$60,000 of a member's combined balances, with up to $20,000 from the OA.

The extra interest from the OA will go into the member's Special or Retirement Account to enhance his retirement savings.

Meanwhile, the concessionary interest rate for HDB mortgage loans, which is pegged at 0.1 percentage point above the CPF interest rate for the OA, will remain unchanged at 2.6 per cent per annum from 1 April to 30 June 30 this year.

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Denied: Banks cut lending to shoe-box buyers-Yahoo! Singapore(News)

Uncertainty reigns as banks decline finance applications for small units. (Photo courtesy of PropertyGuru)

By Andrew Batt (courtesy of PropertyGuru)
With the prospect of a drop in property prices looming large on the horizon, Singapore banks are already tightening their lending criteria. Prospective buyers of so called shoe-box units are already discovering that access to funding is proving to be a challenge.

PropertyGuru understands that at least one bank in Singapore is now declining all finance applications for properties under 500 sq ft in size — the generally recognised measure for shoe-box units in Singapore. Other banks remained tight-lipped about their individual policies and declined to comment on the record when contacted by PropertyGuru.

An employee of CIMB who declined to be named told PropertyGuru that financing for shoe-box units is simply no longer being offered. "It's just too risky right now" he said, adding that he understands most banks are not even considering applications from individuals with a substantial deposit and perfect credit history.

For Getty Goh, whose company Ascendant Assets released research about Singapore's shoe-box property market late last year, this news was expected. He said, "It doesn't come as a surprise that banks are slowing down on their lending, especially when the economic outlook for the next few months remains highly volatile."

Why are banks deeming these smaller units to be more risky that other parts of the property sector? Goh believes the answer is simple.

He said: "It's because some shoebox units are asking for unsustainably high per-square-foot prices. In light of the impending property market slowdown, these high priced units will be the first to be affected by any drop in valuation. This drop in asset valuation will, in turn, affect the banks — especially when the value of the collateral is significantly less than the loan."

Arun Mambully, director of research and editorial at The Asian Banker, echoed Goh's comments. He told PropertyGuru, "The prospects of lower economic growth in Singapore for 2012 coupled with macroeconomic uncertainties are pushing banks to focus on the quality of their asset base.

This same trend is reflected in banks globally, as we can see European banks stashing away excess liquidity with central banks across the globe. Add the rise of property price index to this mix, and you get all the ingredients necessary for banks to pull back lending to riskier asset classes."

Buyers of these smaller properties are typically investors, and unlike those properties which are purchased for owner occupation, the risk of the buyer defaulting is much higher. Buyers of shoe-box units also rely heavily on the rental market to repay their financing, and this will also be impacted during any prolonged slowdown.

Goh added, "Banks are ultimately in the business of making money through lending money. The last thing they want is to see their loans go bad. Any rational and responsible bank would naturally not want to make risky loans - especially when the market outlook has become highly uncertain."

Andrew Batt is Regional Group Editor at PropertyGuru.

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Witnesses to animal abuse should turn up in court: Shanmugam-Yahoo! Singaopre(News)

Law minister K Shanmugam, together with his wife, decides to bring home this rescued puppy after an animal welfare …

Singaporeans cannot expect animal abusers to be prosecuted if witnesses are not willing to turn up in court to testify against them, Law and Foreign Affairs Minister K Shanmugam said at an animal welfare forum on Saturday.

The grassroots adviser was responding to animal lovers' concerns that some offenders seemed to have been let off the hook too easily.

Shanmugam said that while the Society for the Prevention of Cruelty to Animals and other non-governmental organizations (NGOs) have made recommendations "for bad behaviour to be punished more severely", "every case has got to be proven beyond reasonable doubt" at the end of the day.

"You need witnesses who turn up in court, to give testimony from their direct knowledge," he explained. "It's not enough for them to do a written statement."

Shanmugam also made clear that he was speaking at the forum in his capacity as a Member of Parliament (MP) and "a concerned person", and that he has "no ministerial ability for any of these issues".

The minister was also speaking up for Agri-Food & Veterinary Authority (AVA) which had, in an earlier presentation, highlighted its challenge in getting eye witnesses to come forward.

"From what I understand, people are prepared to file a complaint. They're prepared to write something but they're not prepared to actually turn up in court," shared Shanmugam.

And if you don't have that (testimony)… how does the court conclude that the person who's accused was the abuser? That's the problem that is often faced in such prosecutions," he stressed, before adding that they "cannot change the law just for animals".

Remy Ong's case
When asked next if national bowler Remy Ong ought to be prosecuted for allegedly running over a dog last week, the MP for Nee Soon group representation constituency advised the floor against "getting into a lynch mob mentality" before any truth in the case is revealed.

"He (Ong) has a version of events which is out of the newspapers… I think, in the context of fairness to everyone, we should avoid getting into a frame of mind of presuming the worst of anyone and assuming that he is guilty well before investigations have concluded," Shanmugam said.

"The law applies equally to everyone, it doesn't matter if he's a man on the street, you, me, or a national bowler," he asserted. "Investigations will be conducted impartially."

He added, "And he, like anyone else in any situation, ought to have every opportunity of explaining himself, defending himself and an impartial authority will decide on that."

Turning to the issue of stray animals, Shanmugam went on to highlight their plight, as well as that of the AVA, following recent reports of joggers being attacked by stray dogs in Punggol.

"Today, Singaporeans expect the AVA to solve the problem immediately. And if the dogs are still around the next day or the day after, AVA gets a lot of complaints," he said.

"AVA is in a very difficult position. On the one hand, they have to assure the safety and security of the residents who are complaining about the stray dogs, and on the other hand, you have animal lovers saying 'I don't want you to catch them and cull them,'" he said.

"It's a balancing act," the minister concluded. "If there's a clear security risk or clear health risk, I think AVA has no choice and we have to accept that."

Possible national adoption centre for strays
But stray animals could get more help. Following a recommendation from last year's forum, discussions are now underway for a national adoption centre that will re-home stray cats and dogs, said Louis Ng, executive director of animal welfare group Animal Concerns Research and Education Society (ACRES).

"Minister Shanmugam and MND (Ministry of National Development) are supportive of the proposal and (they are) currently reviewing the setting up of this centre which will be managed by ASD (Action for Singapore Dogs) and ALL (Animal Lovers League)," said Ng.

"We will provide a dedicated community facility that supports and encourages adoption in a way that will benefit the animals, our environment and the community," he pledged.

Details of other proposals from local groups, such as a possible licensing requirement for puppy mills and alternative population control measures besides culling, are also currently being reviewed by relevant agencies.

ACRES also said it will push for a ban of inhumane animal traps. Last week, a community cat had to be euthanised after it got caught on a glue board trap at a HDB bin centre in Jurong.

While the animal protection movement has seen significant progress over the past year, both minister Shanmugam and ACRES' Ng agreed that there will always remain a need to balance conflicting interests in society.

"Any responsible, civilised society should also be judged by how it treats its animals," said the minister.

Ng added to that, saying, "But while some of us want progress to happen at a faster pace, we must ensure that we have a balanced approach, and understand that there will always be alternative views to animal protection issues."

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ATM fraud hits DBS again, S$23,000 stolen-Yahoo! Singapore(News)

UPDATE (11:52am, 24 Feb to include statement from DBS) DBS has been hit by another round of unauthorised ATM withdrawals with S$23,000 stolen from 17 accounts last Sunday night. All affected customers were fully compensated within 24 hours. In a statement released on Thursday, DBS said it received calls from a handful of customers who were alerted to unauthorised ATM withdrawals in Singapore after receiving real-time SMS alerts from the bank. The bank added that the incident was not a result of any new skimming activity but a residual effect of the same card skimming operation that took place at the end of last year. No other unauthorised withdrawals have been made over the past few days, DBS confirmed, before adding that it is currently working closely with the authorities on the investigation. On Monday, Yahoo! Singapore reported that several DBS customers were left shocked and stranded without cash after the bank deactivated their ATM and debit cards without prior notice. The bank's move was indeed part of its security measures in relation to the recent occurrences of unauthorised withdrawals, a DBS spokesperson said. DBS said that after identifying another group of customers who were potentially at risk, the bank deactivated their cards and took immediate steps to replace them. These customers were informed on the same day and new ATM and debit cards have since been issued to them. However, DBS declined to reveal how many customers were in the affected group. All DBS and POSB customers are encouraged to ensure that the bank has records of their current mobile phone contact details in order to facilitate the receipt of real-time SMS alerts, or other forms of customer communications. Customers can also choose to lower their daily ATM cash withdrawal limit at any branch and the bank strongly encourages its customers to refresh their PINs on a frequent basis for added protection. Related articles: DBS chief apologises for ATM fraud incident DBS moves to implement security measures Two Malaysians behind ATM fraud to plead guilty *back into the abyss of death*

Gov’t unsure of what it wants to achieve: SDP-Yahoo! Singapore(News)

The SDP unveils its second annual Shadow Budget entitled Securing Our Future which tackles “real problems deeply …

The Singapore Democratic Party (SDP) questioned on Wednesday the government's ability to plan the future for Singaporeans following the release of the budget for the incoming fiscal year.

Leaders of the opposition party said features of the budget pandered to populist sentiments that arose from the general election last year, when the ruling People's Action Party garnered the lowest share of votes ever.

At a press conference Wednesday, SDP treasurer Vincent Wijeysingha and SDP secretary-generalChee Soon Juan presented the party's second annual "shadow budget" as a suggested alternative to the government's spending plan.

When asked to cite examples of what they said was government's "irresponsible financial planning", Chee cited the participation of government-linked corporations and multinational corporations "suffocating the SMEs" as one.

Arguing that budgets should lay down fundamentals for the future, Wijeysingha, also the principal author of Shadow Budget 2012: Securing Our Future, noted that the government has instead been operating "from a position of insecurity" following its performance in the last parliamentary elections.

"A plan must always look at the long-term… (even though) the temptation of any government is to try to re-build its relationship with the electorate," he said.

Adding to that, Chee said if the government tries to appease negative sentiment and still try to keep up GDP growth, "we're going to get this very schizophrenic situation, which we cannot afford."

Chee pointed out that in the case of the contentious migrant workers' issue, the government did not seem to know what it wants to achieve in the long term and how to achieve it.

He noted that in 2010, the government said it wanted to reduce Singapore's reliance on foreign workers but the next year, the Ministry of Manpower announced that the number of foreign workers coming in increased.

"Then Prime Minister comes in and says we need to increase the number of foreign workers because of a weakening economy. And within just barely three months, Minister Tharman comes out and says the exact opposite… We're not getting a consistent picture," he said.

Alternative budget

The SDP's shadow budget this year proposes a stark shift away from the government's spending priorities. For one, the party suggested cutting defence spending by 22.5 per cent, or an approximate $$2.72 billion, because the enemies "don't exist".

SDP sets out the government’s expenditure estimates in its alternative financial plan: Shadow Budget 2012. (Sc …

Under the government's budget, Singapore will raise its defence spending by 4.3 per cent, or S$504 million, to S$12.28 billion in the financial year 2012. According to data cited byAFP, the expenditure will constitute 24.4 per cent of the government's total spending for 2012, making the ministry the largest beneficiary of the budget allocation.

This maintains Singapore's status as one of the biggest spenders in this area on a per capita basis, second just after Israel, as stated in the shadow budget.

While anticipating a vulnerable global economic outlook ahead, the alternative expenditure plan also outlines a series of measures to promote "more efficient, productive, people-focused and creative approaches to the developmental issues we face now".

Singapore faces the challenges of slowing economic growth, increased social needs, high income disparity and low social indicators, Wijeysingha said.

The alternative budget also unveiled what Wijeysingha referred to as a "troika' of agencies designed to reorient the domestic industrial structure towards the SME sector.

The troika — the Economic Development Board joined by a Singapore Enterprise Agency and Spring Singapore — will work alongside three new funds: a Developmental and Exploratory Fund, an Invention Fund and a Youth Enterprise Fund.

In his hour-long presentation, Wijeysingha also detailed measures to reduce costs of doing business, including the introduction of Corporate Ezlink Cards and subsidies for premises rental as well as the removal of ERP for business vehicles.

The SDP also pushed for a graduated Goods and Services Tax and a Property Sales tax for foreign, non-resident property buyers.

Turning to social welfare, the shadow budget also proposed new approaches to improve public transport and the quality of education in Singapore.

More on the healthcare aspect will be addressed in the party's upcoming National Healthcare Plan, where proposals have been set out to make services truly affordable to ordinary Singaporeans, Wijeysingha said.

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Would S’pore commuters bear the cost of more buses?-Yahoo! Singapore(News)

Minister of State for Finance and Transport Josephine Teo and REACH chairman Amy Khor respond to questions posed …

Members of the public couldn't help but ask after the government announced it would spend $1.1 billion to add hundreds of buses to run along Singapore's streets.

Responding to several questions about this at a REACH dialogue on this year's budget on Wednesday evening, Minister of State for Finance and Transport Josephine Teo explained that the government's aim was to improve service in public transport, which suffered a big blow in December when a series of train disruptions affected hundreds of thousands of commuters.

In additional to the planned purchase of 800 more buses by the government and local transport firms, she said a rail extension or a new rail line would also be introduced each year leading up to 2016.

Teo noted concerns that operation costs will increase for public transport firms SBS Transit and SMRT given the need to pay for more fuel, more drivers and even more space at interchanges, but that government's purchase of 550 of the buses will help alleviate the burden of increase fares that could be handed down to commuters.

"Fares at some point will still have to be adjusted, we all know this," she said. "But if we were not to put in this injection, then the pressure on fares will be very, very heavy, and that is something we think is not very suitable at this point in time."

Asked whether the cost of the transport operators' own purchase of 250 of the additional 800 buses could be passed on to consumers in the form of raised fares, Teo maintained that the fare formula used by the Public Transport Council (PTC), which approves fare adjustments, is not impacted by the government's move to finance the purchase of the rest of the buses.

She also explained that increasing bus capacity was deemed a faster way to improve public transport service levels while rail capacity was gradually being built up.

"We think that what Singaporeans want is a quicker solution. They don't want to wait so long, so it's with Singaporeans' needs in mind that we assessed that the better, faster and more efficient way to do it is to partner the existing public transport operators to deliver the increased capacity. That's why it's done in partnership with them," she said.

Slightly fewer than 200 members of the public were present at the REACH Budget 2012 Dialogue, where about 20 came …

Other issues

Addressing about 200 members of the public, business community and youth ambassadors alongside REACH chairman Amy Khor, Teo also fielded questions on other aspects of this year's budget such as measures to help the disabled and the silver housing bonus.

In particular, Teo paid special attention to explaining the measures in place for small and medium enterprises (SMEs), which she said are the "lifeblood" of Singapore's economy.

Noting that the nature of land-scarce Singapore, located in the heart of an emerging Asia, would mean that the country would always have a tight labour market, Teo said that the government aimed to help SMEs build their capabilities, and make them stronger and a more attractive option to employees five to 10 years on.

Turning to a related issue -- that of foreign workers -- Teo conceded the difficulties that many SMEs face with hiring local labour, but also acknowledged the reasons why local labour find the jobs unattractive, given their financial needs and skills training.

"To some extent, wages and work conditions have to improve, otherwise many Singaporeans will find it hard to enter certain jobs," she said. "But at the same time, we also need our workers to respond, to consider the fact that it's better to have a job than no job at all. It's better to pick up new skills, to go into sectors which are still hiring than to insist on being in a sector that is no longer hiring. So both sides need to make the adjustments."

S’pore public invited to air views on animal welfare-Yahoo! Singapore(News)

This is the largest and most diverse local animal protection event to be held in Singapore (Yahoo! photos/Clarence …

Singaporeans are invited to voice their concerns about animal welfare issues and offer suggestions on amendments to legislation on the matter at the largest animal protection event to be held in Singapore this Saturday.

More than 600 participants are expected to attend, including Minister for Foreign Affairs and Minister for Law K Shanmugam.

"I welcome this event, and support it.  How a society treats animals, which cannot take care of themselves, says much about the nature of the society.  The increasing support we are getting for animal welfare events is heartening," said Shanmugam, who is also a Member of Parliament (MP) for Nee Soon group representation constituency.

Louis Ng, executive director of animal welfare group ACRES, one of the main organisers of the event, said, "There has been significant progress in the animal protection movement in Singapore over the past year. Through this event, we hope that more people will become aware of the need to protect animals and most importantly help shape animal protection policies in Singapore. With the support of the public, Singapore will undoubtedly be a leader in the animal protection movement in this region."

The event will take place this Saturday, 25 February at Chong Pang Community Club from 8am to 5pm. Log on to ACRES for more information on the event.

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