Friday, September 4, 2015

Why do Opposition Parties need to sell stuff to raise money but the PAP doesn't


I first saw the above picture on the Fabrications About the PAP Facebook Page.

Instead of jumping on the bandwagon and attacking the Opposition for being money-grabbing scoundrels, I decided to do the responsible thing and try to do some research as to why unlike the Opposition Parties, the PAP does not need to raise money by selling fans, umbrellas, decals and flags at their rallies. Below is the reason why

PAP MPs have to contribute 10% of their monthly allowance to the party (Source). With 80 PAP MPs in Parliament with a monthly salary of 16,041.67 a month, this means that there is a contribution of at least $128,000 a month, $1.54m a year or $6.16m over the past 4 years.

However, out of the 80 MPs, there are various appointment holders who have additional allowances. There is

1 Prime Minister who earns $2.2m a year (Source)
18 Ministers who earns about $1.1m to $1.76m a year
5 Senior Ministers of State who earns $935,000 a year (Source)
6 Ministers of State who earns $770,000 a year (Source)
5 Mayors who earns $660,000 a year
1 Senior Parliament Secretary who earns $572,000 a year
1 Speaker of Parliament who earns $550,000 a year
2 Parliament Secretaries who earns $418,000 a year
1 Deputy Speaker of Parliament who earns additional  $82,500 a year

This means that cumulatively, there is a contribution of $23m by PAP MPs and Appointment holders over the past 4 years to Party funds and this is before bonuses.

Cost-wise, PAP faces the following costs for General Elections in 2015

89 election deposits of $14,500
Approximately $4 per election expense per voter (Source)
Approximately 2,460,977 electors in these 89 seats

Total cost: $11.1m which is less than half of the total MP contributions over the past 4 years

In contrast, the only other opposition party with MPs in Parliament is the WP. The WP have

7 MPs earning $192,500 a year
2 NCMPs earning $28,900 a year

Assuming that the party contribution for WP is 20%. Total party contribution over the past 4 years is merely $1.12m.

This is hardly enough to cover the costs of the elections for 28 seats which includes

28 election deposits of $14,500
Approximately $4 per election expense per voter (Source)
Approximately 375,500 electors in these 28 seats

The total cost of holding elections for WP is thus approximately $1.9m which is more than the party's contribution over the past 4 years. As such unlike the PAP, WP MP contributions alone are insufficient to pay for election expenses.

As such, the reason for why Opposition parties need to sell stuff to raise money for elections but not the PAP is very simple. PAP has greater contributions from MPs and Appointment Holders to its coffers (approximately $23m) while they are expected to spend about less than half this amount on election costs in 2015.

In contrast, the most well-funded opposition, the WP will find itself about 40% short of its costs even if it requires it's MPs to contribute a double the proportion of what PAP MPs contributes.

L.A.M.

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Note: After writing this post, I have noticed that it has been shared and read by many people and used to justify many different thoughts and opinions. Among the most ridiculous of which is that I am promoting communism. Lol.

I would like to categorically state that there is no need to infer my political leanings from what I write. As best as I can, I task myself with only two things, being politically informed and non-partisan. 

This article merely reflects one avenue of income for political parties. I am not advocating or condemning any party. The PAP, with it's long history as the dominant party in Parliament would have had the resources and time to create a formidable war chest and this is neither immoral nor illegal. 

However, we should not use this as a basis of comparison against opposition parties, who face different obstacles and have to resort to different kinds of funding methods. If there is anyone that I am condemning, it is irresponsible parties like FAP and TR who try to mislead the public with half truths and lies.

I hope that in this GE, all Singaporeans can try to be a little bit more mature in how we treat different parties. 

There should not be any bullying or misinformation or irresponsible sensationalisation. We as a nation are already half a century old. It's time to put these childish things behind us.

23 comments :

The said...

The main reason is the the PA has a budget of more than $1 billion........

Anonymous said...

Lam,

Thanks for doing the maths for us. It looks reasonable (even though you use 10% contributions for PAP and 20% contributions from WP). So it seems WP needs to further raise fund, and PAP has spare change ... for the election.

Wonder if other members of the party who are not MPs nor Ministers contribute to membership fees? And if these membership fees can be used towards cost for election? (Of course, there are ongoing running cost associated with running a party, whether election season or not)

Anonymous said...

How about donations from individuals, corporations and organisations? Is this available as public information, which would allow comparison across different party?

What regulations on donations, if any?

John Lam said...

Yes, I did not manage to find the contribution rate for WP and have assumed that they contribute 20% of their salary. It could be less than that and this would lead to larger deficit.

If you have credible sources of information on the donations and membership fees. I could possible incorporate it into the analysis for a better picture but based on MP and KAH contributions alone, we can see a marked difference in terms of funding for the party.

Anonymous said...

Lam, contributions only play a small part of miw's party funds. Go find out how many private limited companies under them and you will know the real reason.

Anonymous said...

A point to note is that PAP ministers work full time. Most WP MPs have jobs outside. Pretty sure lawyers and lecturers pay pretty well. If they contribute 10% of their full time job pay, the amount would have been much higher.

Another point to note is that the PAP has a lot more MP ==> more contribution?

Anonymous said...

So if PAP ministers works full time and WP's don't, how come PAP TC and other stuff are managed with similar quality than WP? Are PAP MP less efficient?

lawrence ho said...

Ya . Can see their ad boards on e streets oredi much bigger in size n numbers than others.. Cause they got more budget ..

Anonymous said...

I find this article v funny...so r they supposed to start on equal grounds?? They are 50 yrs ahead... R we trying to b a communist state?

John Lam said...

Not trying to encourage communism. Just providing an answer to the question why PAP does not need to sell stuff during the rallies but the WP and other opposition do.

PAP has different income streams so their methods are different. I am not judging or saying that anything here is wrong with any method. Just that the opposition may have to work a bit harder to raise income from alternative sources, that's all.

Anonymous said...

Do u even read the article? �� ok ok. Read the topic.
I think it is fair enough to say that the article is trying to deduce and justify why opposition needs to find alternative fundings (eg. Sell merchandise) . It has nothing to do with communism and getting parties to start on equal fundings.

Anonymous said...

Well done very good analysis

Anonymous said...

Thank you for the good analysis. Good job

lisa said...

I dun think wp mp has full time Jobs out there. Lilian cfm don't ve.. she is my sis
So its lost of income once outta PE .. she drop her full time job to serve ..no directorships no shares held in other XYZ limited

Anonymous said...

I know PAP use lots of funds to train and attract youngsters to work and plan for the people. Unfortunately, most talented and far-sighted people I know rather go lead private banking, be surgeons or managing MNCs, etc, than to work for the people. It seems to them that the louder citizens seem to be more cynical and unreasonable than critical and their logically flawed arguments do not contribute constructively to the building of our society. This makes political involvement not an intellectually challenging one. (Note the difference between sorting out demands and impractical expectations instead of looking for different innovative solutions to enable sustainable growth in singapore.) http://thepeakmagazine.com.sg/2014/10/feature-liu-thai-ker-2/

Anonymous said...

Does anyone has an idea of SDP funding? I always wonder where did they get their money from? Does parties need to declare foreign donations?

angkuguay said...

Interesting analysis. I have seen quite a few opposition leaning friends sharing this article of yours to bolster their stance of how unfair the PAP is towards the opposition.

However, I beg to differ, and not just because I am pro PAP. I think that where elections and vote chasing is concerned, the PAP is being extremely fair towards the opposition. This is not something that can be said outside election season.

Why? The PAP, as the ruling government, were the ones who imposed limits on the amount that could be spent during election. Without this restriction, the PAP would have simply overwhelmed ALL the opposition parties with its own vast monetary resources.

What do you think?

Anonymous said...

Morning Angkuguay, thanks for your contribution to the thread but I believe the author has already stated that the purpose of this article is to explain why there are things on sale at an opposition rally(as per the meme).

The article has not said anything about how the incumbents are treating their campaign opponents.

While we respect your support for your choice of party, there's no need to get so defensive and ballistic, seeing accusations where there are none.

Have a nice day!

Anonymous said...

You have left out the fact that the PAP often uses the resources of the People's Association ("PA") for campaigning purposes. The PA is funded by taxpayers to the tune of $1 billion a year.

RCs and CCCs which are GROs under the PA regularly organise community events with PAP MPs as VIPs. The PAP MPs don't need to lift a finger apart from merely turning up for such events.

angkuguay said...

I'm curious, can point out how have I been "defensive and ballistic" when it is not my intention at all? Perhaps my views on this matter is deemed too offensive to you that you deemed it right to label me as such?

If that is the case, I sincerely apologize to you, whoever you are, that my views run contrary to yours.

Have a nice day too!

John Lam said...

Guys please stop arguing on my blog

Anonymous said...

I think the $406,000/- for the election deposit for the 28 candidates should not be treated as an expense. I believe in the last GE no candidate lost his deposit

John Lam said...

In the last GE, 3 candidates lost their election deposit. Desmond Lim lost his election deposit twice and Kenneth once.

Although the election deposit is not necessarily forfeited all the time, it is still upfront money that needs to be put up first. Furthermore, there are other forms of expenditure that needs to be incurred for daily expense of the political party.

The main thing is not so much the expense but that the income streams for these parties are very different.