National Day Rally 2018: 8 things you need to know from PM Lee's speech

Prime Minister Lee Hsien Loong's speech highlighted challenges faced by Singapore at home and abroad such as trade tensions, cost of living pressures, and in healthcare and housing. ST PHOTO: GAVIN FOO

SINGAPORE - Prime Minister Lee Hsien Loong, in his National Day Rally address on Sunday (Aug 19), highlighted challenges faced by Singapore at home and abroad such as trade tensions, cost of living pressures, and in healthcare and housing.

He elaborated on how the Government will provide support for Singaporeans in areas like healthcare and public housing, and how Singaporeans can work with the Government to anticipate the country's needs and opportunities in the long-term future.

Here are eight key takeaways from his speech.

1. New scheme to address worries about ageing flats

More owners of older HDB flats will get a shot at going en bloc before their leases run out, with a new scheme called the Voluntary Early Redevelopment Scheme (Vers).

Under Vers, these residents in eligible precincts can vote to have the Government take back their flats, starting from around the 70-year mark of their lease.

The move will also allow the authorities to progressively redevelop old estates over a longer period, instead of only when their leases expire.

But he added that the compensation terms will be less generous than those for the Selective En bloc Redevelopment Scheme (Sers), which acquires ageing blocks with high development value for redevelopment and compensates residents at market rates for their old flats.

This is because there is less financial upside for the Government to take back these flats early.

Only 5 per cent of flats are estimated to be eligible for Sers.

SPH Brightcove Video
Prime Minister Lee Hsien Loong announced several new initiatives, including the Merdeka Generation Package, the extended Community Health Assist Scheme and building more polyclinics. He also addressed concerns about the rising cost of living.

2. More home owners get help to upgrade flats

The Housing Board's Home Improvement Programme (HIP), which heavily subsidises the costs of fixing maintenance problems of ageing flats such as spalling concrete and structural cracks, will be expanded to cover newer blocks.

Previously, it covers flats built up to 1986. It will now be extended to those built up to 1997, benefiting another 230,000 flats in estates such as Pasir Ris, Yishun, Tampines and Jurong.

This kicks in when the flats are about 30 years old. Another scheme - HIP II - will be launched when the first flats reach 60 to 70 years old about a decade from now.

The Housing Board's Home Improvement Programme heavily subsidises the costs of fixing maintenance problems of ageing flats. PHOTO: ST FILE

This means that every HDB flat can expect to be upgraded twice during their 99-year lease - once when they are about 30 years old, through the Main Upgrading Programme or HIP, and a second time through HIP II when they are about 60 to 70 years old.

The first HIP will cost the Government more than $4 billion and HIP II will probably cost more than that, as the flats will be twice as old. But this expenditure is well justified, said PM Lee, and the Government will do it as long as the Ministry of Finance has the money.

3. Merdeka Generation Package

People born in the 1950s celebrating National Day. PHOTO: MINISTRY OF COMMUNICATIONS AND INFORMATION

In recognition of their contributions during Singapore's early years of independence, those born between 1950 and 1959 will be given a Merdeka Generation Package, said PM Lee.

Some 500,000 Singaporeans - mostly in their 60s - will benefit, with additional support to meet their medical expenses, such as outpatient subsidies, Medisave top-ups, MediShield Life premium subsidies and payouts for long-term care.

These are similar areas as what those born in 1949 or earlier got in the Pioneer Generation Package (PGP), announced in 2014.

The Merdeka Generation Package benefits will not be as large as the PGP, as the pioneers had fewer advantages in life, said PM Lee. But, he added, it will go some way in relieving the concerns that this generation may have about healthcare costs. More importantly, it will show appreciation for their contributions.

4. Healthcare subsidies for all Singaporeans with chronic conditions

SPH Brightcove Video
The Straits Times' opinion editor Chua Mui Hoong gives her view on Prime Minister Lee Hsien Loong's National Day Rally speech and its implications for healthcare and housing.

The Community Health Assist Scheme (Chas), which provides healthcare subsidies for middle and lower-income Singaporeans and the Pioneer Generation, will be extended to all Singaporeans with chronic conditions, regardless of income, PM Lee announced.

The benefits will continue to be tiered according to income, and the Ministry of Health will announce further details later.

This can help Singapore's ageing population, said PM Lee, as more Singaporeans will have chronic conditions like diabetes or high blood pressure as they get older, which will incur regular medical bills.

5. Overcoming global challenges

A worker unloads bags of chemicals at a port in Zhangjiagang, China, on Aug 7, 2018. PHOTO: AFP

The international system is at a turning point, with mounting trade tensions between the United States and China and the US and Europe arguing fiercely over trade and defence spending, said PM Lee.

He warned that there is uncertainty over whether new rules and norms for international cooperation will form after a while, or if there will be prolonged tension and suspicion, mutual rivalries and hostile blocs.

While Singapore cannot be confident that the major powers will continue to work with one another, or if the existing international system will still hold, said PM Lee, it hopes that all countries will act with restraint and wisdom, overcome the current challenges, and find a new way to move forward together.

6. Relations with Malaysia

The water pipeline along the Causeway connecting Singapore and Malaysia. ST PHOTO: DESMOND WEE

While Malaysia has seen a historic change in government during its last general election, which saw the Pakatan Harapan coalition led by Tun Dr Mahathir Mohamad take over from the Barisan Nasional coalition, the fundamentals of Singapore's relationship with Malaysia have not changed, said PM Lee.

The two countries, bound by ties of kinship, history, geography and economy, must work together to tackle common challenges, and find constructive ways to resolve their differences when their interests diverge, he said.

PM Lee touched on two policies that Dr Mahathir's government wants to review after taking over - the High Speed Rail (HSR) and the Rapid Transit System (RTS) Link to Johor, and the 1962 Water Agreement.

On the former, PM Lee said that Singapore entered the two projects in good faith after careful negotiations because they benefited both countries. He added that both Singapore and Malaysia have to carry out what has been agreed to under the legally binding bilateral agreements, unless both sides mutually agree to vary the terms.

On the 1962 Water Agreement, PM Lee reiterated Singapore's view that the pact is sacrosanct, and that its terms must be followed with strictly.

Under the current agreement, which expires in 2061, Singapore is entitled to draw up to 250 million gallons a day (mgd) of raw water from the Johor River at 3 sen (1 Singapore cent) per 1,000 gallons.

7. Cost of living pressures

Commuters using their mobile phones in an MRT train. Prime Minister Lee Hsien Loong said Singaporeans are spending more on items such as mobile phones. PHOTO: ST FILE

Singaporeans are feeling cost of living pressures, acknowledged PM Lee.

He offered four reasons why they feel this way:

- young families are worried about housing and pre-school education

- the sandwiched generation looking after both children and older parents worry about education and healthcare costs

- Singaporeans are spending more on items such as mobile phones and overseas holidays to sustain a higher quality of lifestyle

- inflation which has led to price increases.

SPH Brightcove Video
The Straits Times' deputy political editor Elgin Toh talks about how "it takes two to tango" to tackle the rising cost of living, an issue Prime Minister Lee Hsien Loong highlighted in his National Day Rally speech.

PM Lee also noted that while overall wages have increased, some have had wage stagnation while others have lost their jobs. Retirees are also worried about savings running out.

On price increases, PM Lee said that while the Government has tried to keep inflation low and prices stable, price increases for some resources such as water and electricity tariffs cannot be completely avoided as Singapore faces resource constraints.

Some price increases are also a matter of perception, he added, as people tend to remember increases vividly but not price decreases.

The Government will make sure that housing, healthcare and education are kept affordable, but Singaporeans will also have to do their part to watch their expenditure by saving water and electricity, and making smart consumer choices, he added.

8. Hawker culture's Unesco bid

Singapore will be nominating its hawker culture for inscription into Unesco's Representative List of the Intangible Cultural Heritage of Humanity. PHOTO: ST FILE

Singapore will nominate its hawker culture to be inscribed on the Unesco Representative List of the Intangible Cultural Heritage of Humanity, PM Lee announced in his Mandarin speech.

If successful, it will be Singapore's second inscription, after the Singapore Botanic Gardens was declared a Unesco World Heritage site in 2015.

Putting Singapore's hawker culture on the list of intangible cultural heritage will help to safeguard and promote this unique culture for future generations, said PM Lee.

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