Enough Talk About Singapore’s Inequality Problem. Let’s Get Down To The Solutions.

By Kwan Jin Yao

Any lingering doubts that socio-economic inequality is – or will be – a problem in Singapore were probably laid to rest in the past week, when President Halimah Yacob, Minister for Education Ong Ye Kung, and Prime Minister Lee Hsien Loong made inequality and social mobility key themes in their speeches in parliament. In comparison, neither “inequality” nor “social mobility” featured in former President Tony Tan’s three addresses to parliament in 2011, 2014, and 2016, and social mobility in the context of Singapore has only been referenced in two of Mr. Lee’s 14 National Day Rally speeches, in 2005 and 2017 (inequality was mentioned in two other speeches, in 2008 and in 2013, in the Malaysian and global context). This year, that Mr. Ong’s speech centred on inequality also points to a belief that education is the site for intervention.

In the past year too, a study on social capital and class divide published by the Institute of Policy Studies (IPS) and the widely reviewed “This is What Inequality Looks Like” by sociology professor Teo You Yenn have advanced the public discourse on inequality.

Yet the speeches of Mr. Ong and Mr. Lee (in fact, the IPS study too) were scant on substantive policy solutions. Part of this stems from the way the government talks about inequality, either by hedging (the “there may be some inequality in Singapore, but we have not fared that badly…” approach) or by lacking precision with measures of inequality. Another part of the problem are the principles which undergird the government’s approach to social policies – that of self-reliance, familial support, and “many helping hands”, which were characterised most recently in 2015 by Deputy Prime Minister Tharman Shanmugaratnam as a “trampoline” – which as a result of our general prosperity have rarely been challenged. Finally, and relatedly on these perceived sacred cows, an apprehension towards policy experimentation.

Instances of hedging and the lack of precision can be gleaned in these latest speeches delivered in parliament. The prime minister spoke about how Raffles Institution (RI) has become less diverse – presumably in terms of the demographic and socio-economic backgrounds of its students – noting that: “Just over half the students live in public housing, 53 per cent, and all the students get along confidently and comfortably”. Notwithstanding the observation that “public housing” is a broad category which does not necessarily speak to the actual distribution of students (since they could be living in bigger apartments) as well as the proposal for the Ministry of Education to work with top schools like RI so that they “never become self-perpetuating, closed circles”, the 53 per cent still compares poorly to the approximately 80 per cent of Singaporeans who live in public housing. Remember the brouhaha in 2008, for instance, when it was revealed that just 47 per cent of public service scholars lived in public housing. More critically, the systemic reasons causing these disproportions remains unexamined.

Mr. Ong, in his speech, began by arguing that Singapore has been able to moderate its Gini coefficient (before taxes and transfers), even though the figure creeped up in 2017 to 0.417, after a general decline since the 2008 recession. Then, he compares Singapore’s Gini coefficient (after taxes and transfers) and annualised change in median monthly household income with a sample of six other countries, without justifying how the countries were chosen in the first place. When comparing Singapore’s Gini coefficient (after taxes and transfers) with these six countries – never mind the fact that the measures were taken at different time points – the education minister emphasised that we did better than the United Kingdom and the United States, but not Denmark, Finland, Japan, and South Korea, where there are “comprehensive welfare systems”.

(Citing a Ministry of Finance study on inter-generational mobility, which found that “14 per cent of [young Singaporeans in their 30s] with parents who were in the lowest income quintile when they were growing up, managed to move up to the top quintile of income earners as adults”, Mr. Ong should have stressed that this rate of movement might not apply to subsequent generations, as social capital accrues.)

The reference to “comprehensive welfare systems” – juxtaposed against the government’s approach to social policies – also means we have not been able to challenge existing policies, to interrogate structural explanations for inequality, and to be more experimental or innovative with policy recommendations. Mr. Lee said that the government is not ideological, but pragmatic, yet Mr. Ong made it quite plain that social assistance continues to operate on the principle of self-reliance (and prudence too). Mr. Ong’s opposition to unconditional “universal welfare” is premised upon fiscal and motivational reasons, that taxes will go up and that individuals would become “passive recipients of welfare”.

This discussion about solutions, however, deserves so much more nuance. What exactly do we mean by “welfare”, beyond cash handouts? What are the trade-offs that Singaporeans are willing to accept – between higher taxes and social services or “welfare” – and to what extent are trade-offs contingent upon a strong social compact, which has made citizens in other countries comfortable with higher tax bills? And beyond the dichotomy of condition and unconditional assistance, what are the suite of policies available? I agree with the prime minister than there are no easy solutions to reduce inequality and to improve social mobility, though amenability to experimentation is a start.

Which is also why Mr. Lee’s point that “the Finns tried [a universal basic income] and aborted the experiment early” because it did not work is not entirely accurate. First, the experiment was scheduled from the start to conclude at the end of 2018. Second, nothing is known about the findings, as to whether it “worked”. Kela, Finland’s national body, will only publish results at the end of the experiment.

What Finland’s basic income experiment does speak to, rather, is the value of iterative, evidence-based approaches to policymaking which “eschews the conventional assumption that the government necessarily knows best”. Thus far in Singapore, the solutions to inequality have rarely moved beyond hypotheticals to piecemeal attempts at change, such as the principal of RI – mentioned in Mr. Lee’s speech – “speaking to parents of potential students in primary schools … to encourage them to apply to RI”. And on hypotheticals: What happens if we did abolish PSLE? If students were posted to schools based on location? And if we did a deeper examination of the profiles of students in top schools and who receive public service scholarships, to understand how mobility or meritocracy has manifested?

These questions speak to my vested interest as a researcher, yet the government does not have to look far – to Finland, for example – to appreciate the value of research and experimentation. Early childhood education and intervention through KidSTART and pre-school featured in the speeches of Mr. Lee and Mr. Ong, and programmes in these settings had their origins in research studies like the Perry Preschool Project in the United States. Such studies are not the be-all and end-all, and their implementation will take time and resources, but they are constructive starts to frame the problem and to systematically examine a range of options, while challenging our preconceived assumptions.

This post was first published over at the blog of Kwan Jin Yao on 18 May 2018. It is reproduced with permission.


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