Rich Singapore resists welfare reforms

The recent recession has exposed the vulnerability of Singapore have-nots. Critics say the city-state should provide a better social safety net. 

For decades, Singapore’s government has sought to script the lives of its citizens, earning a reputation as an authoritarian democracy that delivers the economic goods.

On paper, it has become wealthy – in nominal terms, per capita income was $39,000 in 2008, on par with Japan – and has the highest rate of home ownership in the world.  

But over the past year, deep recession has exposed the vulnerability of those left behind. Though headline growth has recovered, job creation is lagging, with 5 percent unemployment in September. That's the highest level since 2003, when the SARS (severe acute respiratory syndrome) epidemic took a toll on Asia travel. 

A common refrain here is that while the country is rich, ordinary Singaporeans are not. Critics point to a widening income gap, stagnant wages at the bottom, and competition from low-paid foreign workers as reasons why the economic gloom has yet to lift, even after the recession officially ends.

Another factor is that Singapore’s government, despite its interventionist zeal, is stingy when it comes to welfare spending. It is at pains not to describe its social programs as welfare, which smacks of free lunches and laziness. As a result, workers here have no right to unemployment benefits and only the most destitute can apply for short-term financial aid.

Critics say the system is cumbersome and inequitable. “More and more people are finding it hard to make ends meet. This filters down to create problems in society,” says Leong Sze Hian, a financial adviser and blogger.

Government officials argue that European-style welfare systems would undermine Singapore’s work ethic, be abused by claimants, and become a burden on taxpayers. Instead, the government focuses on workfare training and top-up schemes, and gives grants to specific categories of needy citizens, including deprived students and low-income elderly.  

In a written response, the Ministry of Community Development, Youth and Sports (MCYS) said such schemes are designed as a “springboard” to self-reliance. “Our measures are calibrated and targeted so that help goes to those that need them most,” it said.

Stringent questioning for welfare-seekers

Last year, Jessie Roobalosani fell into that category. A mother of three children, she became homeless and wound up in a government-run shelter after leaving her alcoholic husband. She now lives with her mother, stepfather, and three children in a one-bedroom apartment in a public housing block, one of hundreds that line Singapore’s tidy streets.

Six months ago, Ms. Roobalosani found a job as a baggage scanner at Singapore’s Changi airport. That took her off the welfare roll, so now she struggles to pay the bills from her $535 monthly salary. Her mother was recently hospitalized with a stroke and is no longer around to take care of her two young sons while she’s at work.

Roobalosani says she applied for various government grants but got bogged down in demands for supporting documents and interviews. None of the promised aid came through, she complains.

“By the time you’ve done it all, you just want to quit. I’m genuine. Why do they want to bother asking so many questions?” she says.

Experts say Singapore’s stringent evaluation of welfare claims acts as a deterrent to all but the most dogged. Only 26,000 households currently receive benefits, up from 22,700 at the end of 2007. By contrast, more than 100,000 households – the bottom 20 percent of Singapore's income rung – earn less than $715 a month, a level that can be considered poor, says Mr. Leong. That bottom percentile has seen its income decline in real terms since 2001. Singapore has no official poverty line.

Many Singaporeans shy away from public handouts and have a strong work ethic, says Paulin Straughan, a sociologist at the National University of Singapore (NUS) and an unelected lawmaker. But welfare is there for those who really need it, provided they know how to access it, she says. “If you’re poor in Singapore you won’t go hungry.”

Homeless in tents on beach

Nor do the poor get shunted into slums. Public housing estates are well maintained and a point of pride for Singaporeans who visit other countries in the region with substandard housing.  

But social workers say that homelessness, while still rare, is on the rise. Along Singapore’s tropical beachfront, where visitors can camp out under the stars, some tents are quietly occupied by families whose homes have been foreclosed.

“By the time they come to us, it’s already quite bad. We’re really the last resort,” says Samuel Ng, who runs a social outreach center that is partly government-funded and has helped some families living on the beach.   

Critics say such hardship is unacceptable in wealthy Singapore, a city-state of 5 million, of which around one-third are foreign workers. Some challenge the government’s focus on rapid economic growth and say it should also be building a proper social security net for its citizens.

“We can’t push for growth at any cost. It’s a stupid model. Even China is making moves [toward a welfare state],” says Sinapan Samydorai, executive director of the Think Centre, a civil rights group.  

Such critical voices are rarely heard in Singapore’s media, which hews closely to the government’s line. But the debate may start to move from blogs and public-policy seminars into the mainstream as an aging society runs up against the limits of its pension system. By 2030, one in five Singaporeans will be over 65, putting a strain on retirement savings among nonaffluent workers.

“When your population is young and you have a rapidly growing economy, you don’t feel the need to spend on welfare. But Singapore will age rapidly after 2010,” says Mukul Asher, a professor of public policy at the NUS.