FM, I agree with you totally that NUS must get the
brightest and the smartest into their university but still cannot
understand why our local is being rejected when they are taking in
far greater numbers of foreign students (and fully paid scholarship
with no bondage complete with English tution). Perhaps your
government feels that their parents can afford to send their kids
overseas. Truly, you can be a millionaire if you happened to own a
5 rooms flat in Queenstown or Bishan.
On a side note, your indeed bright. I’ve got only an O level in
my pocket 
Dunno much about the "far greater" number of FT part actually.
I'm from a faculty with vast majority of locals.
But many of the FTs I have worked with convinced me that they
deserve their place. Smart, driven, focused. If meritocracy is the
byword of our country, then many of these FTs have been here on
merit and these are really the best of the best.
Stiff competition here is but a mere reflection of the
competition we face in the international arena. Would it do us good
to shield ourselves from the reality? Nah...I believe even inviting
FTs here can do us good by letting us learn more from them.
As for the part on bonds, the scholarships have bonds
attached.
The problem is that many of these scholars also have earning
potential (and even wealth in many cases) that allows them to
actually consider breaking their bonds in search of greener
pastures. And why not too, if you them.