The WP MP had called for free transport for seniors and persons with disabilities. He also described Minister Iswaran’s remarks on how free transport would impact fare increase on other commuters as a strawman argument because his proposal was for the subsidy for free transport to come from MOT (Ministry of Transport) and not from other riders.
To this, Mr Iswaran said that his remarks were by no means a strawman because fundamentally, there is a need to explain where the money was going to come from. Jamus’ estimates that the subsidy for free transport would cost the government around $300 million to $400 million a year. This is not a small sum. It is a significant increase on MOT’s recurrent operating expenditure. The money has to come from somewhere. The WP had look askance at any fare increase for revenue, citing it would result in higher cost of living. Yet at the same time, it is also calling on the government to spend more to subsidise free transport. Where will the money come from? Mr Iswaran told Jamus Lim they need to square the circle.
Here’s the full text of Mr Iswaran’s response:
Let me start by saying it’s not exactly a straw man argument at all. Because fundamentally, there is a need to explain where the money is going to come from. By the member’s estimates, I’m not saying that I agree with his estimate, but his estimate is three to S$400 million. And then he says it’s 3 to 4 per cent of the ministry’s budget.
I would urge you to look at the budget carefully. The ministry’s budget of S$11 billion includes two thirds which is development expenditure. What you are proposing is a recurrent operational subsidy of three to S$400 million. So in other words, it is on the lower base that we should be looking at.
Specifically, the ministry’s operating budget in the last couple of years has been increased because of Covid specific measures. So if you discount that further, what you’re actually proposing is an increase in the subsidies, if I use a S$2 billion reference point, of about 25 per cent – 20 to 25 per cent. That is a significant increase.
Now, should we incur such an increase? I think it’s something we should debate but I think then we should also, to be intellectually rigorous, examine where the member and his party stand when it comes to sources of revenue.
Because you have to square the circle… And I know that the Leader of the Opposition made a point about how fares have increased and that’s contributing to cost of living.
In other words, the Workers’ Party looks askance at increases of fares and yet [they] are also arguing for spending more… from the government revenue. The member and his party take a dim view of several of the revenue sources that have been proposed by the Finance Minister.
So we have to square the circle. And it’s by no means a straw man.”