In a time when many countries in the world are embarking on initiatives to create a cashless society, Singapore is doing the opposite, by allowing the banks to raise NETS merchant fees by more than 3 times (I think banks are the biggest robbers - whoever heard of a > 300% fee hike at one go?).

The only explanation given by NETS was that there had been increased competition from international payment systems - which its spokesman did not elaborate on or identify. Apart from NETS and various credit card issuers, mrbiao does not know of any other “international payment systems” that are fighting for a share of the market from NETS. Thus, it is more likely that NETS is raising fees just to earn higher revenue at the expense of its loyal merchants and consumers.

This fee hike, coupled with the impending GST raise, will provide a golden opportunity for businesses to profiteer from the situation. I remember many years back when GST was first introduced, my primary school canteen food stall raised the price for chicken nuggets from $0.20 each to $0.25 each - a 25% increase. When I asked the stall auntie why was the price increased, she attributed it to GST, which was by the way only 3% at that time.  Of course, it was apparent that she was just taking the opportunity to profiteer from the situation.

When the GST hike was announced many months back, some government leaders gave passing mention to this issue, saying that the government will not allow businesses to profiteer from this GST hike. However, no details were provided on how this will be achieved, nor were there any mention of the penalties against businesses who attempt to profiteer.

This gives mrbiao the impression that the government is not bothered about taking care of its people’s interest. Rather, it is more interested to generate the extra revenue, nevermind about what businesses would do and how the people would be affected. Sounds pretty typical of a capitalist state anyway.

mrbiao is quite sure that come July 1st, when both hikes come into play, prices of many products and services will go up simultaneously. Both hikes will come down to a total of about 3.5% increase in prices. If mrbiao is a business owner himself, he would raise prices by a minimum of 5%, since it would be too cumbersome to raise prices by 3.5%. However, for a $2.50 bowl of noodles, a 5% hike will bring the price to $2.625, which mrbiao is certain hawkers won’t find easy to implement. Therefore, a more likely increment (given past experience), will be $0.50, to increase the price to $3.00. This will be a 20% hike, when the actual increase in cost is actually less than 4%.

Several merchants interviewed by the press have already mentioned that they will encourage customers to pay in cash instead of NETS. However, this will not be viable for big ticket items such as jewellery or electronics products. Some merchants would implement a discount of 2% for cash payments.

This is a very smart move by NETS. They obviously understand that for big ticket items, customers would be unlikely to pay in cash, given the danger of carrying bundles of banknotes around. The only transactions that would more likely be affected will be for smaller items. The prospects of earning 3 times more fees on big ticket transactions surely outweighs the loss in a few cents of earnings from small transactions that fail to occur as a result of customers switching to cash payments.

There is no other viable reason for the fee hike by NETS - it has monopolised the market for direct debit payments for so many years. With Singapore’s improving economy and the absence of significant competitors, the amount of transactions should only be increasing and not decreasing, and so should its profits.

Singaporeans are once again exploited by the market economy that we love and hate.

I’ve just come back to Singabloodypore and wow, so many new controversies!

The one that struck me hardest was Edmund Ng’s article on a NSF, Lawrence, who got permanently disabled while in service. Apparently, MINDEF settled his compensation issue with a $500 monthly payment and a free CSC card for free medical care at government hospitals and polyclinics for life.

Assuming Lawrence can live for another 40 years, and he receives $500/mth, that would come down to $240,000 before taking into consideration inflation. If we include inflation at a rate of 2.5%/year, the real amount of money he is getting in today’s money is a paltry $150,616.65

In Lawrence’s own words, this payment is not even enough for him to employ a maid to look after him. We are not even talking about compensation for the loss in quality of life yet!

Now let’s compare this to what army ‘old-bird’ regulars are getting in gratuities when they retire. According to a reliable source, a Master Warrant Officer (MWO) will get about $200,000 in gratutity when he retires. And MWOs are already getting about $5,000 to $6,000 a month in gross wages. And all those who have served NS before will know whether senior officers in the SAF deserve the salaries they are getting, so I shall not comment on that.

The MWO gets so much for his contributions to the army, while the poor NSF gets $150,000 in real compensation for a lifetime of suffering as a result of his forced conscription. Is this fair?

One wonders whether there are many other unpublished cases like this where MINDEF quietly settles them with paltry sums of compensation. I wonder how much the families of the soldiers who died in Taiwan will get. I also wonder how much will the compensation be if the dead/disabled person is a senior officer and not just a low-ranking NSF?

MINDEF needs to be more transparent in its compensation amounts and methods. With the fat defense budget and humongous paychecks that senior officers are getting, it is perfectly justifiable and possible to pay a compensation equivalent to the soldier’s expected loss of earnings for the rest of his life.