In a detailed statement to the mainstream media on Wednesday, National Development Minister Mah Bow Tan gave three reasons why lowering the prices of new Housing and Development Board (HDB) flats are "not in the interest of Singaporeans and even dangerous".
He had previously dismissed the WP's housing proposals as "irresponsible".
Among the WP's proposals, the party has called for the prices of new HDB flats to be pegged to the median incomes of households that qualify to buy them. Currently, new HDB flat prices are pegged to resale market prices and then discounted.
Minister Mah said that the WP's proposal to price new HDB flats lower than current levels will devalue existing flats as home buyers turn to new flats rather than resale flats.
The WP is also showing it is against the government's asset enhancement policy by blaming upgrading programmes for pushing up housing prices, said the Minister.
"Why is the WP against upgrading programmes, which enhance the value of Singaporeans' homes and enable the people to enjoy the fruits of Singapore's progress? Why does the WP want to push down the value of all existing HDB flats?" he asked.
Minister Mah's final point: The WP's proposal to lower land costs amounts to an illegal raid on Singapore's reserves.
WP chief Low Thia Khiang had previously called for the pricing of land to be lowered for HDB flats, saying it is a matter of internal transfers within the government.
However, Minister Mah explained that state land forms part of the reserves. When the government takes state land for public housing, it has to pay the full value of the land back into the reserves.
This value is determined by the chief valuer based on market conditions and valuation principles, said Minister Mah.
He added that the WP's motive in its call to abolish the elected presidency is "clearly to remove vital constitutional safeguards, so that it can raid the reserves to fund irresponsible spending".
"Is this what the WP means when it offers itself as a 'responsible' alternative to the PAP?"
Minister Mah said, the government "fully understands" Singaporeans' concerns about rising housing prices.
Pointing to the sharp economic recovery, low interest rates and excess liquidity as reasons for the hikes, he said that the government cannot artificially depress prices.
"But we can moderate the increases, by increasing supply and moderating demand," he said.
HDB is building 22,000 build-to-order flats this year -- the most ever -- and prices and transactions volumes have shown signs of stabilising, he said.
Lower-income households get grants of up to $60,000 to buy flats and the income ceilings for new three-room and design-and-build flats has also been raised, he added.
This article is published by Yahoo! Southeast Asia Pte. Ltd., 60 Anson Road #13-01 Mapletree Anson, Singapore, 079914.