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A promising speech but many items remain on wish list

An Opinion Piece by the Centre for Research on Islamic and Malay Affairs (RIMA)

(August 2012) – Prime Minister Lee Hsien Loong’s 2012 National Day Rally Speech has resonated with many Singaporeans.

And why not?

This is, after all, a period fraught with heated debates to do with suggested government policies to reverse the perceived erosion of national identity linked to issues of integration as foreigners continue to flock into this tiny nation-state; made worse with economists revising forecasts in favour of downward GDP growth coinciding with the upward trend for inflation. As such, with  many in the country still struggling with rising costs of living, the stagnation of wages and the apparent curbs  in government social spending, a speech based on the theme of ‘ A Home with Heart and Hope’ could not but resonate with its listeners.

As is typical of National Day Rally speeches, the Prime Minister began with an assessment of global developments and how circumstances have changed over the last 20 years thus serving to provide context to his speech. Implicit in his message is the rationale that some tough decisions will have to be undertaken implying that Singaporeans must brace themselves for change.

Undoubtedly, changes have in fact come very rapidly over the last two decades with the one that Singaporeans probably felt most being the inflow of foreign talent into the workforce, both in the upper and lower rungs of the labour sector as well as in sports.  The net effect of such a liberal immigration policy within a relatively short period of time is that – apart from being GINI-coefficient-unfriendly – it raises concerns about lost opportunities in terms of social mobility. Primarily, poorer Singaporeans are seen to be facing an uphill battle as they continuously struggle to break free of the vicious cycle of adverse socioeconomic outcomes as a result of suppressed wages made stagnant by the availability of cheaper labour offered by low skilled migrant workers. This is exacerbated by the backdrop of rising costs of living in a meritocratic system which, many argue, tend to favour the better-endowed. Former Association of Muslim Professionals (AMP) Chairman Nizam Ismail highlighted that meritocracy fails to address the inequality at the ‘start line’. The tendency is that it leaves poorer Singaporeans trailing. Education Minister Heng Swee Kiat warned that “extreme meritocracy and competition can lead to a winner-take-all society, with the winners thinking little of others”. He stressed the need to restore a balance to hard-nosed material pragmatism. Mr Heng’s comments can be seen as an oblique reference to some of the social issues that have emerged as a result of the government’s brand of meritocracy.

In his speech, PM Lee cited the example of an illiterate construction worker whose two children went on to be become an IRAS accountant and an A*STAR researcher respectively. It paints a rosy picture of social mobility in Singapore.   What Mr Lee failed to share are the broader statistics reflecting how social mobility trends can regress with respect to income inequality. For every single case of a child doing much better than his father, there are many who in relative terms have not.  Specifically, while a child may end up holding a better job than his father, given the rising costs of living and real wages, how much more affordable are home, healthcare and education to the latter compared to the former? If he faces the same obstacles as his father and is unable to overcome them without relying on assistance schemes, his relative position in life then remains unchanged. The situation is even more dire when seen from the perspective of the Malay/Muslim community whose members are consistently overrepresented at the bottom rungs of the income ladder.

It must be reasons such as these which motivated noted economists like founding Chairman of the National Wages Council (1972 – 2001), Professor Lim Chong Yah, and former Government Investment Corporation (GIC) Chief Economist, Mr Yeoh Lam Keong, to make calls for the government to boost the income of poorer workers.

Professor Lim’s wage ‘shock therapy’ approach was roundly rejected by the government as being too drastic. National Trades Union Congress Secretary-General Mr Lim Swee Say described it as ‘a very risky approach’ which could result in job losses and structural unemployment[1].

Mr Yeoh spoke about the plight of the “working poor”, represented as the bottom 10% of working household breadwinners who hold full-time jobs but yet find themselves trapped in the poverty cycle. He advocates immediate hikes in Workfare payouts to allow all low-wage workers to take home a minimum of $1,500 a month. This approach, while gentler than the one proposed by Professor Lim, is nevertheless still an affront to the government’s view that wage increases must be matched by a rise in productivity so as to ensure firms – primarily SMEs –remain competitive and that the values of self-reliance and resilience are not compromised.

So what will be the fate of poorer Singaporeans?

In his rally speech, the Prime Minister also touched on the theme of ‘Hope’ for Singaporeans. While he acknowledged that social spending will inevitably have to go up, he assured the audience that the state will do what it can to help the poor and needy. Nevertheless, he reiterated that such assistance can never be better than what these individuals and their families can do for themselves. He shared his belief that government assistance should be rendered only on the condition that it does not disincentivize self-reliance and resilience. In addition, he cautioned that “sooner or later”, increasing government spending on such forms of assistance will come at a cost for Singaporeans in general by way of higher taxes. Therefore, we can foresee that the government’s approach of granting assistance only gradually and minimally  to those who need it while  in general striving to keeping taxes low are likely to remain in the foreseeable future. This is despite economists arguing that more assistance should actually be targeted to the working poor so as to better manage their plight. Unfortunately, Mr Lee’s speech serves only to add to speculations that such a combination of policies will likely benefit the rich more than the poor. In essence, while there may be hope for the poor, it will, unfortunately, not be so bright.

Singapore’s so-called open-door immigration policy is also in part due to the need to respond to the country’s fertility problem. In turn, causes attributed to the latter have been linked to factors such as negative work-life balance, housing, healthcare, maternity leave, pre-school education and childcare and infant care.

According to PM Lee, the government introduced many substantive measures aimed at stemming declining fertility rates, such as the baby bonus scheme.  Nevertheless, the statistics Mr Lee cited in his National Day Rally speech remained grim. Reading between the lines, they reveal the failure of current government initiatives intended to alleviate the concerns of would-be parents. In his Rally speech, the Prime Minister then announced a slew of fresh approaches aimed at encouraging single Singaporeans to get married and form family units. Again, while these are very much lauded, thorny issues remain.

Where work-life balance is concerned, the tension between employer and employees was again highlighted during events as recent as the Post-National Day Rally Forum organized by the Centre for Research on Islamic and Malay Affairs (RIMA).  During the session, a participant who is an employer, shared problems relating to obstacles in his firm’s work processes when his female employees went on their four-month maternity leave.  His experience was shared by a forum panelist, Ms Halijah Mohamad, an AWARE activist and owner of her own law practice.  She described how her secretary’s absence due to maternity leave seriously affected her law firm’s day- to-day operations.  Nevertheless, she suggested a more creative approach to maternity leave, such as introducing flexibility such that the mother of a newborn need not take it all in four consecutive months but to stagger it across the work year. Her suggestion may however not be welcomed by mothers who prefer to fully breastfeed their infants for the first four to six months as recommended by the World Health Organization (WHO). It is a challenge to do so if they are away at work.

Again, referring to his speech, Mr Lee attributed the challenge of attaining work-life balance to the attitudes of both employers and employees. While the National Population and Talent Division (NPTD) has been tasked with studying the issue, the current position taken by the government continues to associate the problem to that of the individual’s mindset.  RIMA is of the opinion that solutions based on such perspective will not produce any foreseeable positive impacts in the promotion of work-life balance. Unless there are legislations to enforce work-life balance (as opposed to the current approach of merely incentivising companies which promote it), it is likely that in 20 years’ time, the issue will be unresolved and the government will still be harping on mindsets of employers and employees as the cause of the problem.

In relation to the issue of ‘Heart’, Mr Lee’s framing of problems arising from its policies tends to address the symptoms rather than the causes. A case in point is the challenge of integrating foreigners into the Singaporean society. Mr Lee spoke at lengths to show the disproportionate responses of Singaporeans towards socially unacceptable acts committed by foreigners and Singaporeans. Those committed by the former tend to draw sharp rebuke from Singaporeans whereas reactions against the latter are more muted.

Our view is that the disproportionate reaction to acts committed by foreigners is symptomatic of the larger problem resulting from the government’s lack of foresight when embarking on its previously ‘door-wide-open’ immigration policy. After all, the practice has resulted in rising costs of housing, overcrowding in public transport and downward pressure on wages, among others. Rather than showing genuine empathy however, Singaporeans were admonished for harbouring anti-foreigner sentiments. Perhaps, the government could learn to better empathise with Singaporeans affected by its policies and manage its communications with them more effectively.

For one, the government should display ‘Heart’ for the poor and needy. It should acknowledge that its immigration policy has resulted in wages of the poor not rising proportionally with GDP over the last decade, leaving many to rely on its assistance schemes. Saying safety nets must be coupled with “self-reliance” and “resilience” somewhat shifts accountability from the government to the poor as the attitude of the latter is brought to the fore, obscuring the real causes of their plight. The government should have a relook at the manner in which it couches its words when talking about assistance for the poor and needy so as not to inadvertently portray them as a people with poor attitude who are waiting to capitalize on handouts, hence the need to administer assistance schemes with caution. It needs to be borne in mind that, for many, the experience of asking for help is a humiliating one.

These shortcomings notwithstanding, the Prime Minister’s National Day Rally Speech, far from one that is dry and overtly political, does show that it appeals to the wider audience, with themes that touch on key concerns expressed by Singaporeans in recent years. The human touch embedded in his speech is perhaps a hint that the government is deviating from its rigid top-down approach to a more consultative one. So there isHope that we will find Singapore a Home with a Heart.

Photo Source: www.sg.news.yahoo.com


[1] Wage shock therapy “very risky”: Lim Swee Say. (2012, April 14). Asiaone business,Retrieved September 14, 2012, from http://business.asiaone.com/Business/News/Story/A1Story20120414-339741.html.

 
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