Sunday 14 July 2013

Slower pace of life comes with trade-off, says Shanmugam

By Elgin Toh And Robin Chan, The Straits Times, 13 Jul 2013

IF SINGAPOREANS want a slower pace of life, they must also accept a trade-off in living standards, Law and Foreign Minister K. Shanmugam said at a forum at the National University of Singapore (NUS) last night.

He painted a stark picture of the scale of the challenges facing the country, as pressures from an ageing society set in and the competition on its doorstep heats up.

There is also a fiscal challenge as public spending already outstrips revenue from taxes in this year's Budget, a situation that is likely to exacerbate in the coming decades. The only reason there is no actual deficit is the income stream from the reserves built up over many years.

Weighty realities like these "keep ministers up at night", he said, as they seek to maintain the focus on the long-term development of the country.

"Many people... assume that all other things will remain the same - I will have this lifestyle, I will have this job, I will have this quality of life, and I can afford to slow down," he said.

"But the real answer is: your lifestyle and quality of life and the state of society will be different. As long as we debate that and agree that that is an outcome that we are prepared to accept, yes, the answer is, we can afford to slow down."

Elaborating on Singapore's internal challenges, he cited population figures: Each retired person will be supported by just 2.1 working adults by 2030, down from the current 5.9, and 13.5 in 1970.

Furthermore, as the proportion of senior citizens grows, they will hold more votes and could potentially push politicians to spend more to benefit their age group - as is the case in Japan.

Such trends will affect the amount of taxes today's young will have to pay in future.

Turning his attention to Singapore's place in the world, the minister raised the possibility that making a living would become much harder for the country.

As Asian countries continue to rise economically, Singapore's status as an air, sea and financial hub, for instance, would come under threat if these functions were replicated in other cities in the region, he said.

He gave the example of how China was, for security reasons, developing a trade route that went through Myanmar, bypassing the narrow Strait of Malacca where its ships could be stopped by "a few submarines".

"And when China says it's going to do it, it will be done," he said, adding that this was a point of great concern for Singapore, since 150,000 jobs here depended on its sea hub status.

But beyond these threats and challenges to Singapore's prosperity, there were opportunities that could be seized, he contended.

He painted a vision of Singapore as the New York of Asean, a region with a combined economy larger than India's, he noted.

Already, through free trade negotiations, Asean countries have done away with three-quarters of tariffs on intra-Asean trade.

If Singapore maintained the rule of law, non-corruptibility and safety, it could become a services centre in the region, and reap enormous benefits, Mr Shanmugam said.

Asked about political competition, he said both one-party and multi-party systems can fail.

But Taiwan, South Korea, Singapore and China, he noted, succeeded post-World War II because they had good leadership and political stability.

Biggest risk for Singapore is a populist govt that spends increasing amounts of money: Shanmugam
Channel NewsAsia, 13 Jul 2013

Law and Foreign Affairs Minister K Shanmugam said one of the biggest risks for Singapore is a populist government that spends increasing amounts of money to succeed.

Already, he noted, there are other challenges facing the nation, such as an ageing population, a shrinking workforce and rising healthcare costs.

Mr Shanmugam said: "There's always something else on which money can be spent. But every time the government agrees and puts down a programme, you must remember it's hard-coded, very difficult to take it back.

"Whenever we put down a programme today to spend money, I think the biggest risk for Singapore is a populist government that decides that the way to succeed is to spend more and more money. Every programme that you put down money (for), today, would just mushroom in 10, 15 years.

"So the impact will not be seen in the next five years. Next 10 years will be okay, but after that, how are we going to afford it? How sustainable is it going to be?"

Mr Shanmugam was speaking at the National University of Singapore U@live forum on Friday evening.

About 330 students, faculty staff and alumni attended the event.

The minister stressed that Singapore has succeeded because it has put in place systems, and thought ahead.

But he also pointed out that there has not been enough debate on the challenges facing Singapore.

Mr Shanmugam noted that a lot of the debate has been focused on day-to-day issues -- which he acknowledged are important as well.

However, he suggested that more debate is needed at this stage of Singapore's development -- on the country's next 20 to 30 years.

He added that moving forward, what is important for Singapore is for there to be good, competent people in government, and political stability.

And while Singapore could slow down if it wanted to, there are trade-offs -- like quality of life that society has to be aware of.

Mr Shanmugam said: "If we start saying, "Can we slow down?", of course we can slow down. But you've got to ask whether the Chinese will slow down, you've got to ask whether the Indians are going to slow down, you've got to ask whether the Malaysians are going to slow down, and preferably be slower than you.

"But if you think you can organise all of that, you can afford to slow down. Alternatively, you must be prepared for another trade-off. If you don't want them to slow down, and let them overtake you, you no longer need to be an air hub or a sea hub, it's possible. But then you need to agree that quality of life could be different."

Mr Shanmugam also weighed in on the dispute over the cleaning of two hawker centres under the Aljunied-Hougang-Punggol East Town Council.

He stressed that Singaporeans will be able to form their own judgements, given that documents are available for perusal.

Singapore needs to choose good people who can deliver: Shanmugam
By Kok Xing Hui, TODAY, 13 Jul 2013

The ability to think ahead has given Singapore success over the years, said Law and Foreign Minister K Shanmugam. However, there is no reason to assume that the chasing pack cannot do the same and compete with the Republic, he warned.

Speaking at the National University of Singapore (NUS) U@live forum yesterday, Mr Shanmugam noted that Singapore’s positions as air, sea and financial hubs are being challenged by China’s new oil route which bypasses the Strait of Malacca and Singapore, Malaysia’s new financial centre and Bangkok’s Suvarnabhumi Airport, respectively. The forum was attended by about 330 people comprising NUS alumni, students, faculty and staff.

Domestically, Mr Shanmugam said a rising expenditure in the face of an ageing population is Singapore’s main challenge. Even today, the Republic’s expenditure is exceeding its revenue and the deficit has to be made up with investments from reserves that Singapore has “squirrelled away”, he said.

During the question-and-answer session, Mr Shanmugam was asked by a participant what sort of political system would be best suited to enable the long-term planning that Singapore has thrived on.

Mr Shanmugam replied: “It doesn’t matter who you vote for, but choose good people. Choose people who can deliver and please vote them in, in a way that gives political stability. There is nothing written in stone that, 20 years from now, the ruling party would be the same as the ruling party ever was.”

He drew a comparison between one-party China and India, which is dubbed the world’s largest democracy.

While China has brought 500 million people out of poverty in 30 years, an Indian child spends only four-and-a-half years in school on average, with an infant mortality rate of one in six children, Mr Shanmugam said. What matters, he stressed, are good people leading the government — people who are incorruptible and clean, able to think long term and are highly persuasive.

Mr Shanmugam was also asked why the Attorney-General’s Chambers (AGC) has the discretion to decide when to press charges.

In response, he cited the analogy of a man who has not eaten for three days and steals a sandwich, and another person who steals to make a profit.

While both committed a crime, he questioned whether the former should be charged.

He also gave the example of a young man with a scholarship to a university who came to see him with his parents at a Meet-the-People Session.

The youth made a “stupid mistake” which would land him in jail and cost him his scholarship, possibly even his place in university, Mr Shanmugam said. Should he be charged or should the Attorney-General give a stern warning and not ruin his future, Mr Shanmugam asked.

“The real answer is: Choose people who are good, put them there, but make sure that your society is educated well enough to know what is happening. If the AGC exercises his discretion badly often enough, it will be obvious,” he added.

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