I refer to CNA article “COE for commercial vehicles reaches new high”. link
The MAS implemented financing restrictions in February to prevent car prices from shooting skywards. Prices of COEs did fall initially but have begun to pick up again.
The reason for this increase is again due to our immigration policy which the PAP will not back down. It is stubbornly sticking to its plans because too much has been invested in our infrastructures. There needs to be returns to justify such investments and the only way is to increase our population.
Our car population as at 31 Dec 2012 was about 616,000. LTA link The targeted annual increase is 0.5 per cent, which works out to be roughly 3,000. However, the PAP’s intended increase in new citizens is between 15,000 and 25,000 coupled with 30,000 new PRs. Since the PAP attracts mainly the wealthy, a small fraction of 20 per cent will easily cause COE prices to shoot up.
The PAP has not been upfront with Singaporeans on this fact.
Since the PAP has already decided to go ahead with increasing the population to 6,900,000, PM Lee must have been aware that there will be upward pressure on COE prices. By not mentioning in his NDR speech, and of course no subsequent reporting in the mainstream media, he was hoping to divert the attention to other issues.
The objectives of the COE system have never been met since day one. Instead, it has contributed to our rising cost of living. Businesses burdened with high costs related to high COE prices eventually pass them down to consumers. Volatile COE prices also affect planning for certain businesses.
In conclusion, COE price increase is caused by obvious demand/supply mismatch due to a huge population increase. (note such a mismatch also caused our HDB flat prices to skyrocket, clearly confirming there has never been any long term planning) The PAP has refused to acknowledge fundamental flaws with the COE system as evidenced by the absence of even a mere word of mention in PM Lee’s NDR speech.
Singaporeans can continue to cow peh cow boo until the cows come home but there is no reason for the PAP’s cash cow to be slaughtered even in the near future.
Phillip Ang
TRS Contributor