"In contrast (to market based pricing), a cost-based system means that the same price would be charged for different flats in the same project, regardless of the location, floor, direction, and other attributes." Just as Clinton once asked his questioner to "define is", Mah is challenging you to "define cost".
Mah is trying again, in his nefarious scheming agenda, to muddy a basic concept. A unit on the 12th floor obviously requires longer piping runs and wiring conduits to reach than one on the 2nd floor - these engineering and construction costs can be accounted for without nebulous conjecture. But he factors in subjective elements like "an unblocked view". How does one value an unfettered view of towering concrete blocks versus, say, a maze of MRT tracks?
Further confirmation of his warped logic is evidenced in his statement that "the subsidy must be set relative to market values". That's as good as the NKF definition of subsidy, as exposed by the KPMG investigation team:
6.11.1 The NKF reported in its Investment Report 2004 that it enabled its patients to save in excess of $3.5 million in treatment costs by providing subisdies for costly medication and by bringing down drug prices.
6.11.2 We found that the amount of such savings was derived from the difference between the prices charged by NKF and a notional market price of drugs based on estimated annual consumption in 2004 instead of the difference between the prices charged by the NKF and the actual prices of drugs paid by the NKF. These savings were reflected in invoices given to patients.
6.11.4 As mentioned above, the market price was a notional market price determined by the NKF. The NKF, being a substantial and significant purchased, enjoyed subsidies and rebates from its drug suppliers. Instead of passing these costs savings to its kidney patients, we found that the NKF charged its patients a premium for certain drugs.
"In my understanding of NKF's view, subsidy must be tested against the market rate and not the net amount incurred." Doesn't that sound remarkably like Mah's sermonising?
Mah's pathetic defence of his Singapore Sales strategy (mark up first, then discount down) is his "basic principle" that the HDB flat is an asset that grows in value, to be realised in the future for resale in the open market. In other words, basic accommodation is not meant to be the roof over one's head, it is just another poker chip in their grand scheme of things. That, of course, is consistent with his boss' stubborn plans to build, not one, but two humongous gambling dens, despite widespread public outrage and inevitable social detriment.