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17 Feb 2019
Ministry of Health
Suggestion View - 378
CHAS subsidy errors

There was a computer glitch that caused the CHAS subsidies for 7,700 patients to be calculated wrongly.

Some received more than they were entitled to; while others receive less. The entitlement is based on the means test that calculates the subsidy based on the income of the person or the family.

Here are my views about this incident.

a) The error could be caused by the computation or the errors in the data.
b) It is quite complicated to calculate the income of a person. The income keeps changing from one period to another.
c) The difficulty is magnified if the subsidy is based on the income of the household.
d) The difficulty is further magnified if the subsidy is based on the type of housing occupied by the person.

I have always been against the use of complicated means tested formula based on income and type of housing. These are unnecessary complications that will lead to errors that are now reported for the calculation of the CHAS subsidies.

What about errors in the calculation of the means tested subsidy for a host of other benefits, such as subsidy for hospitalization treatment, subsidy for utilities and conservancy, subsidy for childcare, and a host of other subsidies. A different formula usually applies for each  type of subsidy.

Life is unnecessarily complicated for the citizens and the administrators. I give up trying to read the complicated rules for each subsidy.

What is the alternative?

The subsidy should be based only on age. Older people should get subsidy for health care and transport. The subsidy should not depend on income and type of housing. 

Does this mean that the high income people will enjoy the same subsidy as the lower income? Yes, and there is a good reason. By all means, impose a tax on income and on property. Let the high income people pay their income and asset based taxes.  And use a progressive rate, so that the more wealthy will pay more taxes.

After the high income residents have paid their tax, let them enjoy the same subsidy as other residents.

For the retirees with no income or low income, give them a monthly allowance to meet their living needs. There is no need to give them all kinds of means-tested subsidies for different types of benefits.

We have to stop the waste created by complicated formulas for calculating different means tested subsidies. Life is already difficult and challenging without these unnecessary stress and complications.

Tan Kin Lian



 


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