Look Ahead 2023: Economic uncertainty and inflation lower chances of an early General Election, risk deepening social divides, say analysts

SINGAPORE — With the rising cost of living amid an uncertain global economic outlook hitting middle-income earners, and the recent Goods and Services Tax (GST) hike viewed by some as a contributing factor, analysts say the low likelihood of an early General Election (GE) being called in 2023 has become more remote.

They also point out that the previously-held assumption that voters will flock to safety when faced with an uncertain future was challenged in 2020 when a GE called amid a pandemic and looming recession led instead to a drop in the ruling party's vote share and loss of another group representation constituency 

Talk of an early GE being held in as early as 2023 surfaced after the leadership transition resumed pace last year following Mr Lawrence Wong's ascent to the helm of the fourth generation (4G) leadership team of the People's Action Party (PAP).

This speculation arose even though the presidential election (PE) is due to be held by September this year when President Halimah Yacob's six-year term expires, raising the spectre of two major polls in a calendar year.

HOW GRIM IS THE ECONOMIC OUTLOOK?

With the global economy going through a difficult transition out of the Covid-19 pandemic and the ongoing fallout of the Ukraine war, it is unclear when economic conditions are set to ease, said Dr Gillian Koh, deputy director of research at the Institute of Policy Studies (IPS).

“Calling a GE in difficult times may not be as straightforward a matter of thinking it will provide the People’s Action Party with a clear advantage.”

The timing of the PE is stipulated by law. It can be held from June and as late as September, provided Madam Halimah does not vacate the seat before her six-year term expires.

The timing of the GE, however, is an entirely political decision and the ruling party would want to pick a date that is to its greatest advantage party, Dr Koh said.

Political watchers, however, were split on whether an early GE may be called this year.

The next GE is not due until 2025 and Associate Professor of Law Eugene Tan from the Singapore Management University believes it is “highly unlikely” for a GE to be called this year.

But some still think that a GE in 2023 is still on the cards. Former PAP Member of Parliament (MP) Inderjit Singh believes the PAP may wish to call for a GE earlier in the year without having to worry about the PE getting in the way, if it is seeking an early mandate.

Dr Felix Tan, a political analyst from Nanyang Technological University, also noted that Singapore has held both elections in the same year before, in 2011. 

He said that Prime Minister Lee Hsien Loong and Deputy Prime Minister Lawrence Wong might choose to go to the polls in 2023, to secure a strong mandate to govern Singapore through a looming period of global and regional instability.

COST OF LIVING

Regardless of whether an early GE will be held, political observers expect the economy as well as bread and butter issues to weigh prominently on Singaporeans' minds in the year ahead, with potentially greater divisions between the haves and have-nots.

One such issue is the cost of housing, given the spotlight on public housing subsidies and issues surrounding Built-to-Order flats over the past year, said Dr Tan. 

Another is the GST hike that kicked in this year when the rate rose from 7 per cent to 8 per cent. The GST will rise again to 9 per cent in January next year.

Mr Singh said that although the Government has introduced good financial support for the lower-income to offset the GST hike, the ruling party may take a hit from middle-income Singaporeans over the issue.

He added that it would have been better if the Government's position on the GST had been finalised after the conclusion of the Forward Singapore national public consultation process. 

A Forward Singapore road map to be released after completion of the exercise in the second half of the year will set out both policy recommendations and how various parts of society can better contribute to the nation's shared goals, based on its values of a united people and a society that is just and equal.

“The world has gone through major structural shifts and we are seeing some kind of a reset in every part of the world,” Mr Singh said. “Surely, a new world will need new solutions and not something thought of in the past.”

However, the Government has stated that increasing the nation's revenue base through an increase in GST is needed to help better prepare Singapore for the post-pandemic world.

Mr Wong has also said more revenue from GST is needed to invest in the nation's people and social infrastructure.

Dr Tan said that while the GST hike will definitely feature heavily in the GE hustings, if they were to take place this year, some Singaporeans will feel that any discussion is moot given that the phase one of the hike has already kicked in.

“One would need to see how the Government will help those who are severely affected by this GST hike in the coming months before it becomes an election campaign issue,” he said.

POLITICAL SUCCESSION; OPPOSITION’S FUTURE

For political watchers, 2022 was a year of several significant events that could surface as key issues in the next GE.

In April 2022, Cabinet ministers named Mr Wong as the chief of Singapore's 4G political leadership, paving the way for him to be Singapore's next prime minister.

Dr Tan said that many Singaporeans are already expecting Mr Wong, who is Deputy Prime Minister and Finance Minister, to take over in the next few years, so they may take the results as a vote of confidence in Mr Wong’s policies and plans.

Affecting those on the other side of the political aisle, there was also the release of the Committee of Privileges report that looked into former Workers’ Party (WP) Member of Parliament Raeesah Khan’s lies to the House and abuse of parliamentary privilege.

The committee recommended that WP chief Pritam Singh and vice-chairman Faisal Manap be referred to the Public Prosecutor over their conduct during the committee’s proceedings. The case has since been referred to the police, who are still investigating the matter.

Assoc Prof Tan said that if the two leaders are prosecuted, they would have to spend significant time and energy defending themselves.

He added: "If they are successfully prosecuted, it will be a severe reputational hit to them individually and to the Workers' Party."

Both Mr Singh and Mr Manap are being investigated for allegedly lying under oath during the committee's probe.

Those found guilty of perjury under the Penal Code may be jailed for up to seven years and fined.

Under the law, an MP will be disqualified from his position if he is been convicted of an offence and fined at least S$10,000.