Government paying for everyone has great appeal of simplicity but leads to greater inequality, says PAP’s Tharman

A strategy for greater inclusivity in society and lesser inequality. This is what the People’s Action Party (PAP) has been focused on doing in the last decade.

And there is still much to do, said Senior Minister Tharman Shanmugaratnam in a live broadcast on PAP’s Facebook page today (July 7).

And this is even more important now given the Covid-19 situation. “Covid is becoming a major social crisis in many countries around the world. It is fracturing societies because it is impacting some people much more than others,” he said.

“And it is going to lead to slow growth,… it is going to lead to increased tensions amongst people. And we must avoid that.”  

He added emphatically: “We’ve got to build a society with a stronger social compact. And we can do it.” 

Starting with the young, especially those who are from lower income backgrounds

Tharman highlighted the efforts that the government has initiated for children, even before they enter school. 

And it’s not just the broad-based programmes that apply across the board, but those that also go deeper, he said. “It has to be something more. It has to involve deeper interventions to help those who start with less.”

This will help every kid regardless of where they start, to have a good start and the best chance in life, he added.  

He also touched on reducing the differentiation amongst children in schools by doing away with streaming at the primary level and moving towards full subject-based banding in secondary schools.

It enables students to “mix more with each other and interact with one another”, rather than be classified as weak or strong academically, he explained. 

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Leaving no Singaporean behind

“We’ve got to make sure every Singaporean is on a moving escalator. Everyone,” said Tharman.

And with Covid-19, special care has to be taken to ensure that young people entering the workforce do not become a “lost generation”, where their income and job prospects are not permanently diminished. 

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He also stressed that the escalator should not stop for middle-aged and mature workers either and said that the PAP is doing this through the investment of skills in every Singaporean.  

With regards to the increase in unemployment that has occurred because of Covid-19, he said: “Far better that we put government resources into subsiding jobs and skills than into subsidising unemployment,” 

“Because then people feel that they are useful, they’re picking up new skills, and they have got a pathway to a permanent job in the future,” he added. 

He highlighted that Singapore’s productivity and income have actually increased by one-third over the last decade and said that the progressive wage model is working and is better than just simply implementing a minimum wage. 

Taking care of seniors

Singapore’s CPF system is established to ensure that society doesn’t become more divided, a scenario which may happen if people get to decide for themselves what to do with their money, he said. 

“The basic rationale (behind schemes like CPF Life, Medishield and CareShield Life)  is that we have got to take collective responsibility for one another. We cannot leave each other to fend for ourselves,” he said, adding that the government is giving support in these areas too, especially for the lower income and middle income groups. 

Choosing a system where the government simply pays for everyone means that the taxes, especially for the middle income group will have to rise significantly “for the sums to add up”.  

“It has great appeal of simplicity, but it leads to greater inequality."

[embed]https://www.facebook.com/watch/?v=290135565439404[/embed]

kailun@asiaone.com