Maths not strong point of Gerald Ee and friends

In Financial competency, Political governance on 06/01/2012 at 7:08 am

Taz my impression after seeing via the Internet Table A of the Recommendations and u/m from statement by RP. Funny that a commitee where there are two* trained and very, very senior accountants (Gerald Ee and Ms Fang Ai Lien) can make these elementary maths errors. Wonder what other errors of maths and logic, there are? Check this out.


Instead of making assumptions abt how much the office-holders would be paid (including bonuses) under the new scheme vis-a-vis their take home pay in 2010 (including bonuses), why not give their basic salaries (less bonuses) in 2010 and compare it to their new basic salaries? No need to make assumptions on the bonuses that will be paid.

Doing it the way the committe did it could give rise to the suspicion (reasonable) that the bonuses are “guaranteed”.

Basic misunderstanding of median calculations
We … would like to draw attention to a fundamental beginner’s mathematical error made by the committee. According to today’s report by CNA,

“The committee said that with the discount, the pay is actually closer to the top 1,400th earner.”

Wrong! The median of the top 1000 is the mid-point between the 500th and the 501st earner. Applying a 40% discount to the amount earned by the 500th earner does not mean that the resultant salary would necessarily be close to that earned by the 1,400th earner or even the 700th earner (which is what 40% more than 500 comes to ). It would depend on the distribution of incomes between the 500th and the 700th earner. A reasonable inference resulting from this kind of elementary statistical mistake leads one to doubt the quality of the statistics used by the committee to underpin the pegging of the salaries and the Key Performance Indicators for bonus awards. We cannot believe that the committee would deliberately be disingenuous or mislead the public with such an erroneous statement so we must assume that this kind of fundamental error is merely indicative of the ‘top talent’ that the government attracts.

A committee that cannot calculate the median of the top 1000 is either deliberately misleading the public or incompetent is the very emotional personal response by KennethJ, son of the late JBJ, a man of strong passions.


Update on 6 January 2012 at 7.12pm: Seems Po’ad Mattar is also a very senior accountant. So three accountants and committee can still goof when it comes to maths. Sigh or LOL take yr pick.

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  2. Could it be the 1400th earner takes in $1.1mil? That is, Mr Ee is not doing maths on the percentiles (like what KJ is suggesting) but simply telling us that from IRAS data, the 1400th Singapore citizen earner takes in $1.1 mill in YA2011. So in YA2011 the 1000th earner earned >$1.1mil. Just wondering. Best to ask Mr Ee.

    • So why he ya ya talk abt “Median”? All he needed to say is “$1.1m = around 1400 person on list”.

      • Errr because the median is used for calculating the benchmark? The above commenter is correct, the 1400th position thing is not related to the benchmark and Ee didn’t link the median with the 1400th position. KJ just completely misunderstood lah.

  3. Hey, they are non paid volunteer, don’t be too hard on them. I am sure they do not want to be in this committee if they have a choice.

  4. Po’ad Mattar is also a very very senior accountant. So there are three of their kind in the panel, not two. LOL

    • Perhaps they just signed off the report without knowing what’s in it, and they were in the committee to show its “independence”? Who wants to bet that LHL reviewed and approved the recommedation before its release?

  5. After the review report was released, it became apparent that the whole thing was an operation to get back political capital. The fact they need to put in an arbitrary discount should speak volumes to the more astute political observer that their core values remain the same – massive sense of self-entitlement, that pay is indicative of dignity, etc.

    Also, we must all thank to Grace Fu for opening her mouth and reinforcing what most people already know – that this generation of PAP leaders have no substance and are really nothing to write home about.

    Poor LHL. He is really scraping the barrel.

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