"To be clear there is no public record of expenditures by the Singaporean government to account for the $512 billion SGD in free cash flow since 1991. Nor is there a public record of assets held by Temasek, GIC, or other public body in large enough amount to account for such a large discrepancy. Remember if this $512 billion earned the 7% GIC claims to have earned there should be more than $1 trillion in assets."
("The Mess That Is Singapore Part II", The Balding Blog)
If, as the professor asks, the Singapore government enjoyed free cash flow from budget surpluses and borrowing totaling S$512 billion between 1991 and 2002, where did the money go?
When Dr Chee Soon Juan raised the issue of Singapore's secretive US$10 billion loan-pledge to Suharto at a wet market in Jurong East during the hustings of GE 2001 (“Mr Goh! Mr Goh! Where is our money, Mr Goh?”), Goh Chok Tong, without saying a word, facetiously pointed to his pocket and waved his pesky questioners away. Election theatrics aside, Goh later said the issue referred to a US$10 billion loan offered to the Suharto government during the 1997-98 Asian financial crisis. The loan had conditions attached and was not taken up.
Last month, Singapore announced a contribution of US$4 billion to the International Monetary Fund. Under query in parliament, Prime Minister Lee Hsien Loong assured the public that the money will not come from the Government Budget, but from Official Foreign Reserves (OFR) held by the MAS. And where did MAS get their seed money in the first place, pray tell.
From the layman's perspective, why should good money be thrown after bad, especially when our own people need it more - to boost up wages for the lower income, build more affordable housing, repair a failing transport system, and reduce health care costs.
With so much money bandied around, it is a wonder that Singapore still has a high debt-GDP ratio. The truth is that our CPF savings is exchanged for pieces of paper called “special issues of Singapore Government Securities (SGS)”, a unique loan instrument afforded to the government. In other words, the CPF is the primary purchaser of the debt issued by the government of Singapore. Oh, we are supposed to get our retirement money back, with the pathetic 2.5% - if the monies are invested wisely. GIC and Temasek have boasted of 7% and 17% returns since inception. If their books are in order, we are back to the original question: where did the money go?
Ex-President Ong Teng Cheong asked that question once, and was informed by the Accountant-General that it would take "52 man-years" to produce just the list of physical assets of the Government (Government’s assets include both physical assets and financial assets). Now that we have a president related to the prime minister through family ties, will a better answer be forthcoming? Here's what the Ministry of Finance says:
MAS and Temasek already publish the size of the funds they manage. As of 31 March 2011, the Official Foreign Reserves managed by MAS was S$295 billion, and the size of Temasek’s portfolio was S$193 billion.
It is the size of the Government’s funds managed by GIC that are not published. What has been revealed is that GIC manages well over US$100 billion. Revealing the exact size of assets that GIC manages will, taken together with the published assets of MAS and Temasek, amount to publishing the full size of Singapore’s financial reserves.
It is not in our national interest to publish the full size of our reserves. If we do so, it will make it easier for markets to mount speculative attacks on the Singapore dollar during periods of vulnerability.
Further, our reserves are a strategic asset, and especially for a small country with no natural resources or other assets. They are a key defence for Singapore in times of crisis, and it will be unwise to reveal the full and exact resources at our disposal.
A simple no would have sufficed.