In the recent National Day Rally speech, Prime Minister Lee Hsien Loong gave useful tips on how one's cost of living could be reduced.

One big factor in Singaporeans' cost of living is the price of land, which not only affects our mortgage payment, but also most of our other daily expenditures.

High land prices result in shops having to pay high rentals, which leads to them having to sell their products or services at a higher price.

Currently, the Government sells land through a two-stage bidding process.

In the first stage, it looks only at the concept. Concepts that are accepted move on to the second stage, where the highest price bidder wins the project.

Over time, this method of awarding the land to the highest bidder leads to escalating land prices.

Developers will look at historical bids and try to bid higher than the previous highest-winning bid in order to maximise their chances of winning.

There have even been instancesof the winning bid exceeding the second-highest bid by a huge margin.

To prevent prices from skyrocketing, I propose that the winning bid at the second stage should be the one made by the second-highest bidder and not the highest.

This changes the psychology of the bidding process completely as developers will not just put in a ridiculously high bid to win the project.

The Government could go a step further by awarding the project to the median bidder.

Some might argue that this new method will result in a lower revenue to the Government from their land sales.

While this is true, the nation's loss is the citizen's gain as everyone will benefit from a lower cost of living.

Furthermore, land is actually a renewable asset as it will be returned to the Government once leases expire.

Martin Lee