Income Inequality in Singapore. Govt: So What? Climb Your Way Up

The Straits Times Insight had conducted a survey to look into the “Singapore Dream”. Insight had “commissioned a survey of 400 citizens aged 21 and above” to ask them “for their perceptions of economic mobility.”

The Straits Times had also discussed the survey in Insight today. I struggled to understand what The Straits Times had wanted to say at the end of the Insight article, “Climbing the Ladder of Life.” What was the article trying to say??

What I will discuss in this article is not new. I will look at what has been said about the same issues, to try to come off with a conclusion at the end.

The Singapore Dream?

Firstly, what is the “Singapore Dream” really? I did a quick search to find out what had actually been said about the “Singapore Dream”.

In 2007, Tan Yong Soon (then Permanent Secretary of the Ministry of Environment and Water Resources) had written a book, titled, “Living the Singapore Dream“. The book is a compilation of “the stories of ordinary Singaporeans of diverse backgrounds who took different paths in their lives and in their careers, and succeeded.” In an essay, Christopher Ng had said that, “The original intention of the author was a very good one. His chapter headlines were all universally good advice. We are encouraged to “Triumph over life’s imperfections” and “Pursue your goals with passion and persistence”. But sadly… my personal assessment of this piece of work was that it was very flawed as it showcases only a small number of elite Singaporeans and presenting a very parochial view of what success is like in Singapore.” Christopher continues to say that he then performed a data mining of the stories to identify key characteristics and saw that, “It looks to me that the Singapore Dream can only be lived by those from elite schools. If you do not invest enough time to your academic studies to get a solid university education, you won’t be significant enough for mention in Singapore. It is also much easier to live the dream if you are a Chinese male.” He concluded that we should, “Accept the fact that the Singapore Dream is dead.

In 2008, Dharmendra Yadav had written that the Singapore Dream used to be to, “Get a good education, work hard, save money, get married, own homes, make babies, retire and enjoy the fruits of your labour. (However), in the last 5 years, I know of several friends who have left Singapore because that Singapore Dream, which was once achievable, is now more distant.” He added that, “Some years ago, at a Singapore International Foundation event for foreign undergraduates, I asked the then Minister for Law & Foreign Affairs, Professor S Jayakumar, about this trend (of Singaporeans migrating). He basically made statements to the following effect. There is nothing or little the Government can do to change the minds of those leaving Singapore, and that Singapore should continue to focus its efforts on attracting foreign talent.” Finally, he ended by saying that, “Today, the Singapore Dream has changed: get a good education, work hard, save money, get married, own homes, make babies, retire and then keep on working. As a result, many more find themselves abandoning the Singapore Dream and fleeing this city of possibilities.

In 2010, the blogger of the blog, Diary of a Singaporean Mind, had said that, “The Singapore Dream was once defined as 5Cs – Cars, Cash, Condo, Club Membership, Credit Card… The Cs are still relevant today at least for a large segment of our population whose values have been shaped by materialistic orientation of today’s society.” The author then highlighted that, “There is one C that describes our society so well – that C is COMPETITION. Intense competition that one cannot avoid… When competition becomes too intense and working hard alone is not enough to attain your dreams and people will resort to excessive risk taking, unethnical, unfair, unhealthy & immoral ways to get what they want. What emerges out of this intense competition is not a better, stronger and cohesive society that can take on world but a selfish, unhappy one that is bogged down by the numerous failures it creates internally.” He then suggested that, “While many Singaporeans still dream of the 5Cs, a growing number dream about having more freedom, democracy, equality and justice in our society. The 2 dreams are ultimately linked and whatever stands in the way of one is also standing the way of the other. A growing number of Singaporeans do not want to wait any longer – they are leaving.” He also shared the story of how a colleague had migrated to New Zealand because, “He told me that any place where an average person can lead a high quality of life would be okay….and that is probably what it takes to keep good people in Singapore. It is not just about attaining our own dreams but also a system that will give our children a good chance to do well in life.”

In the same year, then-Senior Minister had said that, “If I have to reinvent the 5Cs, my dream is to help create the conditions for a generation of Singaporeans to have a good Career, live in Comfort, surrounded by Children, and be Considerate and Charitable… Career means constantly striving to be better in your chosen field… It is also about realising your full potential and a basis for individual self-respect and dignity. Comfort means material as well as emotional comfort. You do not need to have a lot of wealth but you must have enough to enjoy a comfortable life. You must also have the right attitude towards life. Otherwise, whatever you have will not be enough for you and you will never be contented. Children refer to home and family and a new cycle of life. They are the main reasons why many of us want to have a good Career and a Comfortable home. Beyond self and family, we want to contribute to and live harmoniously in a larger community. That is where the last 2Cs – to be Considerate and Charitable – come in. Being considerate includes having regard for the feelings and needs of others in our speech and actions. Just as we do not want to be hurt by others’ inconsiderate remarks, we should not pass hurtful remarks of others. This goes beyond family members, friends and neighbours. We should be especially considerate, given the potential divisions inherent in our society – divisions between different races and different religions, between Singaporeans and foreigners, and between the young and old. Being Charitable is not just about giving money but your time and effort to help the less fortunate. It means compassion and empathy for others in difficulties. This is my hope for Singapore. But you should have your own dream. I cannot dream for you; the government cannot dream for you. What the government will do is to create the fertile soil for you to sow and grow your dreams.” Mr Goh had then explained the two conditions that would allow his 5Cs to be achieved: “The first essential condition is a vibrant and growing economy. Such an economy will offer many opportunities and well-paid, challenging jobs. The second essential condition is a quality education system. We will be spending more on education and life-long worker training.”

Perhaps we can, from here, look at how the Singapore Dream has evolved over the years, from one focused on the materialistic pursuit of money to one that explores the personal agency to believe in and do what you want, and have the compassion and empathy for those around you. 

One might agree with Mr Goh on his redefinition of his new 5Cs but his suggestions on the two conditions to make this 5Cs happen does not quite gel. It seems that the government had correctly identified the renewed pursuits that Singaporeans have, ignored them and continued to champion their approach – to grow the economy and build skills – to achieve, not the Singapore Dream, but high GDP growth.

Government Says: Same Old, Same Old

Now that we had explored what the Singapore Dream could actually be, let’s come back to the survey conducted by The Straits Times. To try to understand what The Straits Times had wanted to say, I thought that I could look at the headlines and headings of the article.

“Climbing the ladder of life: An Insight survey finds most people confident that their children’s living standards will be higher than theirs. But they worry the income gap will hurt their chances to move up.”

“Moving up in life, the Singapore way: Insight looks into the state of the Singapore Dream as perceived by those reaching for it.”

“On the up and up”

The meritocratic way

“The worrying gap”

High social mobility a reality… so far”

Gap in skills, gap in perception: Low-skilled more likely to feel luck plays a part in economic well-being”

The following are what stood out for me, but they are nothing new – our government leaders have time and time again impressed this on us:

Singapore Way: Last month, PM Lee Hsien Loong was reported to have said that, “He acknowledged, however, the ‘side effects’ of growth… but he also took pains to counter proposals being floated for the country to dial back on growth and ramp up on welfare.” He had also emphasised again that, “Without growth, he stressed… the country had ‘no chance of improving the collective well-being’.

Meritocratic Way: Ambassador Ong Keng Yong had said at a speech at NUS in 2010 that, “In the immediate post-independence years, social policy in Singapore was very much determined by what the leaders of the ruling People’s Action Party (PAP) believed in. Their vision was that of a “robust and rugged society” where hard work and self-reliance were highly valued. The governing principle was meritocracy. The first Prime Minister, Lee Kuan Yew, had articulated that while not all are born equal, equal opportunities to education, employment, healthcare and housing would be open to all. He had often stressed that no one owed anyone a living and while the state heavily suvsidised the early investments in social development, Singapore was not a welfare state where anyone was entitled to free services. Everyone had to play a part in paying something for services provided and must pull their own weight to ensure progress for themselves and their families.”

Gap in Skills: In 2012’s Budget Speech, Deputy Prime Minister and Minister for Finance, Mr Tharman Shanmugaratnam had said that, “the first major priority of this Budget (is to) restructuring our economy, to grow on the basis of skills, innovation and productivity.” He had also said that, “the only lasting solution for dealing with the labour shortage is to improve productivity (and therefore the government had) introduced a number of major new measures to help businesses address this challenge over the past two years… through the Productivity and Innovation Credit scheme, or PIC, … (by) set(ting) aside $2 billion for the National Productivity Fund (NPF), which will provide more targeted support for industry efforts to restructure and upgrade over the next decade… (and) investing significantly in Continuing Education and Training (CET) to help our workers develop new skills and expertise and increase their versatility.”

So, really, the government is saying nothing new. The Straits Times had presented brand new statistics, but analysed the statistics via the existing protocols on a focused approach towards economic growth, meritocracy and investment, focused to companies, to increase the skills of workers to improve productivity. 

Nothing is meant to change in spite of the new statistics released. Even though Singaporeans are concerned about the growing inequality in the Singapore society, where 70% had indicated that they are worried about the income gay between the rich and the poor and 61% had thought that the government had not done enough to ensure that both the rich and the poor have chances to succeed and move up financially, the way The Straits Times article was laid out – nothing is going to change. You work hard, drill yourself for our economy – or their economy, believe in meritocracy and pick up skills to be productive, so that our economy can grow. Why then did The Straits Times speak of the “Singapore Dream” will The Straits Times wrote this article? Why make us delusional? 

What can we say about the article then? That the government isn’t interested in changing its principles and ways, in spite of the feedback from Singaporeans? The government still insists on sticking to a tried-and-tested model which worked 40 years ago, but which has started to come loose, and some might argue, is broken.

Three Proposals to the Government for Immediate Consideration

From the research that I have gathered today, I would like to advance three proposals that the government should immediately adopt. Again, these are not new and has been discussed by many Singaporeans. I had decided to consolidate them into this article.

(A) Replace the Principle of Meritocracy with Equality

Our government is unable to reduce the income inequality because they believe in the ideal of meritocracy. They have been able to reduce income ‘un-meritocracy’ by emphasising on skills building. Providing skills and education will allow people to have an equal opportunity, this being the principle.

However, governance by the principle of “meritocracy” has led to social inequalities.

Ambassador Ong had also said that, “When Singapore achieved a relatively high level of economic and social development in the 1990s, concern was expressed about the harsh edge of meritocracy and competitiveness. There was the widening distinction between the haves and have-nots. The gap between segments of society had increased. It was also feared that there might be some who would be left behind and not achieve social mobility without extra help.

In a letter to The Straits Times in 2008, Zakir Hussain had shared that, “the man who coined the word meritocracy 50 years ago (was) British sociologist and Labour Party bigwig Michael Young (who) did so to mock the idea of a society run purely on merit. Young invented the term in his satirical work – The Rise Of The Meritocracy, 1870-2033: An Essay On Education And Equality.” He described how the story “portrays a sinister, highly stratified society organised around intelligence-testing and intensive educational selection (where) s system of rigid tests determines one’s social standing, with those scoring highest filling the most important positions and reaping the most rewards (and thus)… a strict hierarchy of merit is created and maintained. Over time, however, what appears to be a fair and just system becomes rigid and ruthless… (which led to) widespread grievances and uprisings against an elite that feels superior to, and regards with contempt, all those outside it.”

Zakir also shared that, “In a paper published this year (2008), Assistant Professor Kenneth Paul Tan of the Lee Kuan Yew School of Public Policy argues, in his paper, Meritocracy And Elitism In A Global City: Ideological Shifts In Singapore, that the Singapore’s meritocratic system “has been practised so extremely that it is starting to show signs of becoming a victim of its own success.” In a separate letter to The Straits Times, also in 2008, Lydia Lim added that Kenneth had also said that, “In trying to isolate merit, ‘it can be a practice that ignores and even conceals the real advantages and disadvantages that are unevenly distributed to different segments of an inherently unequal society.’ He warns that if relevant social differences are ‘hidden beneath an uncritical, even celebratory, rhetoric of meritocracy (as blindness to differences), then the problem of securing equality of opportunity and a reasonably level playing field will be severely underestimated’. That should give those of us who are wont to unquestioningly embrace Singapore-style meritocracy pause. The significance of such differences is set to grow as income inequality stretches with globalisation.”

In fact, Mr Lee Kuan Yew, the founder of Singapore and one of Singapore’s leaders who championed on the principle of meritocracy, had himself remarked, when he had earlier visited Raffles Girls’ Primary School and Punggol Primary School, that, “admission to primary school is not meritocratic, as it is based on the social class of the parents (one just needs to observe the queue of cars outside branded and neighbourhood primary schools at dismissal time to see the distribution of students by social class in primary schools).”

Indeed, Ambassador Ong had concluded that, “it is necessary to address the ugly side of such a policy (meritocracy), especially its social impact. More national approaches may be necessary instead of just relying on community-based self-help groups, which are narrowly focused and have limited resources.” He added that, “Singapore’s social policies should reflect this and bold steps need to be taken to reshape and formulate policies to suit the changing times Singapore faces… Remaining nimble and addressing pertinent issues in a consultative and problem-solving manner are essential.

Thus immediate steps need to be taken to address the flawed principle and practice of meritocracy. We have to stop championing meritocracy as a relevant principle in Singapore’s society. It might have worked in the early days of Singapore’s growth but it has resulted in chasms in the Singapore society, so wide that our social fabric is now threatened by the growing displeasure and anger among Singaporeans, one that can be argued that the government has also fuelled, intentionally or not. Meritocracy necessarily favours the rich and those at the top, and one might argue, the political echelon in Singapore. Then, what this means is that our government and political leaders must take bold steps to admit the benefits that they have been able to obtain from meritocracy, cast it aside, and say, now that we have made enough for ourselves, perhaps it’s time we start thinking about the people. 

Our principles of “justice and equality” are already enshrined in our national pledge. My government, perhaps this is where we should start – equality, not especially since this is what the people who have voted for you are asking you to do. 

(B) Replace Passive Social Assistance with Active Intervention

I wouldn’t have been able to say this better than Dr Lily Neo, and I would like to thank The Straits Times for including her interview in the article. This is the excerpt:

“Tanjong Pagar GRC MP Lily Neo… concurs that the concept of self-reliance must be tempered with an awareness that some families should not be left alone. Sources of social and financial assistance are in place, she says, but the Government has always preferred to have those in need come forward and seek help. But in the face of a growing pool of dysfunctional, low-income families, some form of active intervention must occur, she argues… Last year, she advocated in Parliament for dedicated social workers to track the children of families in the bottom 5 per cent, whose parents often cannot provide more adequate care. (She had said that), “I know for a big country, it is impossible. But we have a limited pool of our own citizens. There needs to be a targeted approach of special care for these children. One-to-one social who will follow up and provide emotional support so that they get a better chance rather than being left on their own.“”

Indeed, the government collects sufficient data and information from Singaporeans. The government has the knowledge and access to the backgrounds of its citizens. Why is it the case that when the lower income families require financial assistance either in their social and housing needs and/or healthcare needs, they are required to undergo tedious application processes? Why are our systems so unnecessarily complicated which limits the access of lower-income families to these services? Why are there MediShield, Medisave, MediFund and other healthcare insurance and policies which the citizens must maneuver before they are able to access financial assistance, when the system should already have a good idea of the circumstances of its people and how to best cater for them! 

One might suspect if the government had intentionally complicated the processes so that it would be difficult for Singaporeans to access these services, and thus reduce the financial claims, and does not cause as much damage, otherwise, to the government’s coffers. 

Instead of sitting like a god waiting for its people to pray to him, the government should send out its workers to work for the people. 

(C) Reduce Income Inequality

Enough has been said about the income inequality in Singapore. I had mentioned the following in this article:

  1. Singapore has the slowest wage growth in the world:According to the Global MetroMonitor 2011, Singapore is ranked at the bottom of 200 countries, with the lowest changes in income, at -8.9%
  2. Singapore has one of the world’s highest income inequality: At 47.3, Singapore’s Gini Coefficient is ranked 29th out of 136 countries.

Prof Lim Chong Yah had also proposed for a “three-year plan includes a wage freeze for top earners while incomes for the poorest are raised by huge quantums – 15 per cent in each of the first two years and 20 per cent in the last year.” He had also said that, “he sees income inequality as a potential ‘Achilles’ heel’ for Singapore which must be swiftly addressed.

Kumaran Pillai, the Chief Editor of The Online Citizen, had provided an interesting perspective. He said that, “My primary assumption is that work is just a function of wealth building; it is a means to an end and not the end by itself.  It means that we go to work each day to enrich ourselves and it should not be viewed merely as means of sustenance. So anybody who is interested in helping those who are downtrodden must look at a holistic solution and not just a patchwork of policies… If I were to purely advocate minimum wage, without addressing the fundamental issues of rent seeking, without addressing how the government is lording over us, without having a discussion about the inefficiencies of the GLC structures of GIC and Temasek… I will be doing this forum disfavour. We need to be cognizant of the fact that historical performance does not guarantee future performance or results. What worked in the past, worked well in the past! When we first started, the government opted for a model where the state controlled the resources; they set the savings rate, and they determined the GDP growth rate. It worked well for us, for a period of time though, and I must add that there were several other factors that contributed to our success, such as the geographical location of Singapore and the Foreign Direct Investment driven model. But, things are different now, there is no assurance that what worked in the past will continue to work in the future.” He added that, “The exploitation that is taking place in the market today is not because of greed as what some people put it. It is because the Singapore government is an active participant in the local economy, stifling innovation and drawing monies out of the circular flow of income. It is the rent seeking practices of our government that needs to be abolished.

Indeed, Nominated MP Laurence Lien had said in The Straits Times article that there is a perception that, “the Government is rich and can afford it.” He added that, “The presence of the national reserves may prevent Singaporeans from making a link between “higher social spending” and “higher taxes for me”” and he believes that “there should be a conversation on tapping more of the reserves for social spending… The Government may find that it cannot have a conversation on higher taxes before conducting one on its coffers.

As I had also discussed, the monies collected from our CPF are 4 times the size of our tax revenue. The government needs to explain to us why it insists that public expenditure cannot be increased without increasing taxes, when it has collected a significantly much higher amount of money from its citizens than what is taxed on us. The government has also not returned to us the earnings from our monies that they have used to invest, without honestly letting us know of where and how these monies are being invested. 

It is time the government listens to us, and seriously. It is time we do not allow the government to run rouge. It is time the government takes the basic steps of ensuring a principle of justice and equality, inequitable distribution to its people and remove barriers and increase access to social services for the lower income groups. 

The government has to because Singaporeans have gotten sick and tired of your games. 

I would like to end by sharing the following: The Institute of Policy Studies, Lee Kuan Yew School of Public Policy  had recently conducted a closed-door session on inequality. It would be interesting to find out how the discussion went.

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2 comments

  1. Pingback: Change Starts From the Top Part II: Can Singapore Govt Trust Its People? « The Heart Truths
  2. SM

    Wow I just came upon this. Inequality is one of my pet topics too. I wrote a rambling entry on it not too long ago – http://tetra-pakk.livejournal.com/168196.html (but it’s on a much more individualistic scale).

    Agree 100% with everything you said. Meritocracy benefits the rich and powerful because they have a headstart. It’s like Usain Bolt vs. a tortoise, and Bolt has a headstart. Obviously, he would win. True meritocracy only works when everyone starts ouut equal.

    At the risk of being brought to court by the government, I’d say that most of our pledge is bullshit. “Regardless of race, language, or religion…democractic society, based on justice and equality…happiness…” Wake up, people.

    But sadly, the people who have the intellectual capital to think about such things are at least middle class, and have the luxury of not worry about where their next meals come from, to think about such issues. Short of being a socialist state, I don’t think it’s possible for us to reduce inequality by much. Want to give welfare, people will find a way to kpkb also.

    Two words (from Max Weber, a classical sociologist): life chances.

    Oh Singaporeans, you are a bunch of enigmas.

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