PM Lee sounds warning on growing social divide

• Singapore’s politics will turn vicious, its society will fracture and the country will wither if it allows widening income inequalities to create “a rigid and stratified social system”, said Prime Minister Lee Hsien Loong.
• “The issues of mitigating income inequality, ensuring social mobility and enhancing social integration are critical,” he wrote in a reply to a parliamentary question from Mr Gan Thiam Poh (Ang Mo Kio GRC). “This is why this Government will strive to keep all Singaporeans – regardless of race, language, religion or social background – together.”
• “As globalisation and technological disruption have widened income inequality, the Government has over the years intervened more aggressively to support the less well-off,” PM said, citing both long-term policies such as education, home ownership and affordable healthcare, as well as targeted, means-tested programmes such as the Workfare Income Supplement scheme.
• Mr Gan’s questions come after an Institute of Policy Studies report last Dec 17, which concluded that Singapore’s sharpest divides now are along class lines, rather than race or religion. It found that people were more likely to share ties with others of a similar educational background or housing type – common indicators of socio-economic level here.
• In recent weeks, the issue gained renewed attention. Deputy Prime Minister Tharman Shanmugaratnam named slowing social mobility, and an ageing population, as the two big challenges that Singapore faces.
• In his reply to Mr Gan, Mr Lee said income inequality in Singapore has declined slightly over the past decade. The Gini coefficient fell from 0.470 in 2006 to 0.458 in 2016 – and the figure was 0.402, after accounting for government taxes and transfers.
• To fund increased social spending, “significant changes” have been made, from introducing GST in 1994 to increasing the reliance on Net Investment Return Contributions as a source of revenue, PM noted.
• “Some degree of income inequality is natural in any economy,” PM said. “But in a fair and just society, this inequality must be tempered and complemented by social mobility. Nobody should feel that his social position is fixed based on his parents’ income level or position in life.”
• Education is a critical plank of the Government’s efforts, PM stressed, whether in building up pre-schools and having schemes like KidStart for children from poor families or giving out bursaries and getting people to go for training via SkillsFuture.
• Meanwhile, the Government takes a “deliberate and proactive approach” to measures that encourage mixing among classes, such as in planning where facilities like hawker centres and playgrounds should be sited.
• In a reply to a question by Mr Seah Kian Peng (Marine Parade GRC) on such measures, Minister for Culture, Community and Youth Grace Fu said her ministry has been working to nurture social cohesion by creating more opportunities for positive interactions, such as through sports, arts and volunteering activities.

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