Monday 16 September 2013

The practical politician: Chan Chun Sing

Minister for Social and Family Development Chan Chun Sing believes in staying grounded in order to help shape policies that will benefit every Singaporean.
By Teh Shi Ning and Wong Wei Kong, The Business Times, 14 Sep 2013

HE laughed when asked about being a future prime minister.

"I don't know why people talk about it this way."

But his has been an eye-catching and meteoric rise. Two years after entering politics and just 44, former army chief Chan Chun Sing has been promoted to full minister, helming the Ministry of Social and Family Development.

Mr Chan's new appointment was the highlight of several cabinet changes announced by Prime Minister Lee Hsien Loong in late August, as the government gears up to tackle fresh policy challenges.

In a wide-ranging interview with BT, his first since his promotion, Mr Chan was quick to downplay his own achievement.

"The rest will all be promoted in due course. I think I can speak for the rest, that for us, teamwork is very important," he says, making reference to a Facebook post by his "good friend", Acting Manpower Minister Tan Chuan-Jin - also touted as a rising political star. "There is a reason why we serve, and it doesn't depend on our appointment," Mr Tan had written.

Says Mr Chan: "Who eventually becomes the PM is not something that we decide individually. Whoever he or she may be will have to command the trust of the team, and at the same time, the trust of the people of Singapore."

"It's not something that's number one on our minds. If anything, what's number one is to make sure that we have a strong team with diverse talent, with overlapping strengths so that we can cover one another's weaknesses. Our concern is whether we can continue to attract enough people to come forward, especially in this more challenging environment."

"I'm sure more people will come, in a more contested space. The question is whether we can continue to have people with the correct values to put the nation before self, and to care about the people and really work hard for the future of the country. That has become even more challenging after GE (General Election) 2011. I think I can speak for my cabinet colleagues that this search for people with the correct values is the number one (priority). Without sufficient depth and diversity in the team, the question of who may be the next PM is "quite irrelevant".

"I know it's a fascinating topic over dinner, but unfortunately, not so fascinating for us. Our preoccupations are elsewhere. We spend a lot of time getting people to recommend good people, and we are also focusing on our own respective work. While we look after the ministries, we also have to build the team."

If teamwork underlines the cabinet, what defines him is a "practical bent", in his own words. His choice of timepiece is a black plastic watch, which has almost become his trademark. "I have been wearing this make of Casio watch ever since I was young and continued into the army," he explains. "It is just a practical thing as it is waterproof and can take the rough and tumble of infantry life. Usually it lasts quite a few years before I sometimes have to change the strap."

"The watch fulfils the purpose of telling time. Never needed anything more than that. When I was a ground commander, I would sometimes add a small plastic compass onto the strap, like many army folks."

"I have a spare which my daughter is wearing now," he adds.

The same pragmatic approach characterises his approach to helping Singapore's most needy. "I'm never very ideological... (to) move left, move right. I don't think we've always been like that. My own view is that we've only one official religion, which is pragmatism - whatever it takes to get our society to share the fruits of its labour in an equitable manner, that helps society stay stable, and yet at the same time, allows the social mobility for people to move up and down." Under his watch, new measures have been announced to transform the pre-school sector, to ensure that children from less privileged backgrounds start off on a more equal footing, and to draw more talent into the social service sector. The provision of social services is being streamlined, and made more accessible. He is also encouraging businesses to give more back to society, and is keen to promote the growth of social enterprises.

While the government has signalled its resolve to make policy changes in housing, education and healthcare to tackle the problems posed by rising inequality and an ageing population, Mr Chan points out that the underlying philosophy hasn't changed.

"I think in a lot of ways, we have always been redistributing," he says, noting that typically, about 40 per cent of every Budget goes into redistribution initiatives.

"In the way we structure our economy, only about 20 per cent of us are net contributors. The other 80 per cent are net recipients, if you take what we pay in taxes in various forms, minus the benefits, excluding security. So actually, our system is highly redistributive. I always jokingly say that we are actually socialists in capitalist clothing."

He notes that some so-called socialist countries have achieved less. "But we use the market to discipline ourselves, to make sure that the solutions we develop are grounded in economic logic."

Question of relativity

What has not changed is that Singapore is still getting those who do better to help those who are not. But as the income distribution curve grows steeper, a few challenges surface.

"One is that you'll have to redistribute more. And the second thing is, how do you keep the bottom-end moving up? Either we raise their productivity for them to command better salaries, or if not, how do you distribute enough for them to keep up generally without destroying the work ethic, and the individual sense of self-worth? That is a challenge."

Even if people's lives are improved in absolute terms, the question of relativity will become an issue. "As the curve becomes steeper, you have what I call the relativity effect.

Everyone in Singapore can say that in absolute terms they have improved, in education, healthcare, housing and so on. But it's not just the absolute that matters, it's the relativity that matters as well. And relativity in some sense is a zero sum game. Relativity in the Internet age has become much more apparent than before, and if people are less circumspect about their consumption, then you have this problem of conspicuous consumption, which actually compounds the problem."

And the widening income gap means a wider opportunity gap too. "Those who are better off will always be able to afford more options than those who are less well-off. And, in time to come, those options may also create more opportunities for their children and their children's children. If you don't do anything then society will fragment."

"So our job is to make sure that those with relatively less opportunities can also have access to the same kind of opportunities. It will never be entirely equal, but you try to narrow the gap, and then within that, people will work hard, and based on their talent, they will have a chance to climb up. Never mind if your parent used to be a stall hawker or a taxi driver... the philosophy is that if you work hard, you'll have a leg up," says Mr Chan, whose own mother, a machine-operator in a plastics company, raised her two children on a salary of $500 a month.

Still, expectations will have to be moderated. A generation ago, one in 20 in each cohort was a graduate. Now, it's one in two. That means not every graduate would be able to attain the traditional trappings of success, such as private housing and a car, in land-strapped Singapore. The challenge is to get Singaporeans to define success less narrowly.

"The fact that you don't own a private property doesn't mean that it's a disaster, that the country has failed you," he says.

"We now have more opportunities for people to pursue a diverse path to success... One part of society will continue to compete within the traditional definition of success, like scholarships, a stable job in a big company, but hopefully (more) will be more prepared to venture out into the arts, sports and start up their own businesses."

What has happened, in recent policies, is a move to subsidise beyond the median, Mr Chan says. In childcare, for instance, subsidies cover up to the 66th percentile.

"When you subsidise beyond the median, it means you're taking from a very small group to help pay for the larger group. This is quite unnatural. In most countries, it's the majority subsidising the minority."

But in order to convince the able to share more, the system must have what he calls the 3Es: efficacy, efficiency, equity.

Efficacy means delivering the desired outcomes, while efficiency is to organise the social service sector in a way that will deliver help to those who need it most.

"Equity is the one that is most tricky. Equity does not mean that everyone gets the same. Equity in our definition means that you always focus and target your resources at those who need more.

"I think that philosophy no one would argue with - the question is, how much more, how much less. And that is where as a society, we must come to a consensus."

Balancing act

A trained economist, he is acutely aware of the dangers posed by rising spending demands, especially for a small country with limited resources.

"Why not take out 100 per cent of net investment income? But when you do that, the real value of your stock diminishes over time, and you'll have a vicious circle of it giving you less and less going forward in terms of real value. Managing the long-term finances of the country is a delicate science. You never know what the new revenue streams are, but you also never really know what the future demands are, so you must always give yourself a bit of buffer, white space to manoeuvre. Otherwise, you have no option space.

"As the population ages, we have to make sure that we carefully balance the bill, because the demand for services will increase, but the generative power of the economy will proportionately be lower because of the ageing population. So we must make sure that the system is sustainable."

It was to help Singaporeans understand the consequences of each policy choice that he started holding grassroots policy forums in his constituency in Buona Vista, which have since become a hallmark of his work on the ground.

"I started this after I came into politics because I'm quite tired of slogan politics, whereby people make slogans and people make promises. I'd like to grow a generation of Singaporeans who very clearly understand the choices, the implications and the option space. I always like to use these words: option space. What are the option spaces that we have? I always tell people policies are never correct or wrong per se, policies are only relevant or irrelevant, appropriate or inappropriate according to the circumstances, and that we must know. So I do that to interest people in such things, so that next time when we make choices for our country, whether during election time, or beyond, we can truly be a true democracy of informed choice makers.

"My job is not to tell them the answer. My job is to guide them and share with them what I have gone through, what my experiences are. And it's up to them to find the answer in time to come. The forum always ends on an open-ended note, I'm not telling you that this is correct or wrong, you make your own conclusion."

So far, Singaporeans from all walks of life have come to the forums, some with immediate issues to raise, and others more interested in broader policy thinking. Opposition figures, too, have been spotted. "At the end of the day, I don't care whether you're opposition or not opposition, party member or politician. There are things that you can discuss logically. You have a certain perspective; you can share your perspective and let other people tell you theirs."

"It's also to show people that it's not so complicated. If you derive your basic principles and understand what you're talking about, then you'll come to a logical and emotional rationale for why certain things are done. It's not rocket science, there's some art to where you find that balancing point, but it's not as if it's so unfathomable."

For the government, balance is also a matter of weighing the economic and political costs of each decision. Even then, policies remain at the mercy of the market's vagaries.

Public housing policy changes over the last 15 years illustrate this, Mr Chan says. At the peak of mounting demand back in 1995, there were 100,000 people in the queue for flats. This led to accelerated building. But then, the Asian financial crisis of 1997 sent the market crashing. "We had half a Sengkang town empty. There was a surplus of 10,000 units. There is an economic cost to holding 10,000 units empty," he points out.

The government switched to a build-to-order system, which worked well for the greater part of the last decade. Then, the global financial crisis hit in 2008. This time, instead of crashing as anticipated, the housing market flipped upwards on the back of low interest rates and capital inflows because Singapore stayed relatively resilient. Demand far outstripped supply again.

It was not the result of miscalculation, Mr Chan says. "Every year, we only have 36,000 babies. One third of them never get married. Two thirds of them get married, that's 24,000 or 12,000 couples. We bring in 5,000 to 6,000 families as PRs. The innate demand, assuming no one dies, no one sells flats, is 17,000 to 18,000. We build 25,000 a year." But this was not enough because with the rising market, anxious buyers brought forward demand.

"Of course, we're going to spend much more, and we're building at breakneck speed to meet the (infrastructure) demand, but will we suddenly, in five years' time, look back and realise we've overdone it? If the cycle just turns, like in 1997, we do run the risk.

"An empty Sengkang has no political cost but it's a huge economic burden. If the government is not very disciplined and is very worried about political cost, then like some other countries, you will pay the economic cost."

For instance, even as the government is resolutely curbing foreign worker inflows, both to ease the strains on infrastructure, social space and to boost productivity growth, Mr Chan worries about going too far. "If we over-calibrate, we would flip the market and if we go on a roller-coaster dive again, suddenly, all the graduates coming out of the universities and polytechnics may not have jobs. That is the scary part."

After all, one reason why the resident population grew rapidly in the past decade was that businesses were crying out for more manpower. And that came when the post-SARS economy in 2004 was still fragile and could have gone into a tailspin.

"To be frank, a bit of the crowdedness we can still manage. It is a problem to manage, but the other problem is just as scary."

Staying extraordinary

The election Mr Chan joined politics was the first Singapore general election in which the ruling People's Action Party (PAP) lost a group representation constituency. It has since lost two more seats in by-elections.

A narrower governing majority may change how political costs weigh into the equation, Mr Chan warns.

To date, the philosophy has been to choose "the correct thing for the long term". "But if your political space is constrained, because people want to put you under pressure, in a very paradoxical way, it may unravel the whole system," he says.

Not one to be "intellectually colonised by other people's ideas", Mr Chan thinks that whether Singapore's political system evolves into a one-party, two-party or multi-party one is irrelevant. Rather, his concern lies with whether it is a system that will produce the right leaders.

"There's nothing to say that the PAP will be around forever. If the PAP cannot renew itself with people with vision and values, if somebody else comes up with a better team, with a better, stronger vision, a better sense of values, then they will deserve to take over the government," he says.

But in the meantime, foreign investors are watching. "Even after the last GE, people came and told us, 'Okay, I know what to do for the next five years because my investments are here. But I will have to think carefully about my decision for the next 10-15 years.' Now if enough of them say such things, then it's not very good for us."

To him, the opposition's claim, that investors have no cause to worry that political change may derail Singapore's long-term infrastructure and other plans, carries irony. If they agree with these plans, why stand in opposition? "It's not so simple, every leadership will bring its own flavour," he says.

The more fires the government has to put out day-to-day, the less attention it can give to the longer-term, which may simply result in more fire-fighting down the road. "Then, we will be like any other country. We won't be extraordinary. We'll be extra-ordinary, with a hyphen," says Mr Chan. And ordinary is not something a small nation state can afford to be content with. "Normality means we'll lose our edge, globally. You can be the most eloquent, discursive Parliament, but if you have no relevance to the rest of the world, then you're a Timbuktu. Your internal dynamics must support your larger external relevance."

He believes history has never been kind to small nation states. "Our challenge is to continually find relevance so that we have some strategic importance. Otherwise, even if we sink beneath the waves of the South China Sea, nobody will shed a tear."

It is a concern he raised as early as at his first press appearance in April 2011, when introduced as one of the PAP's new crop of candidates. Then, some netizens mocked his use of Lanfang Republic to make his point about vulnerable small states. Though he did not have to contest the election in the end - Tanjong Pagar GRC was the sole walkover - Mr Chan met with more derisive comments during the campaign, especially over his use of the phrase "kee chiu" (Hokkien for "raise hands") in one speech to rally the crowd.

"There will always be people who judge you for all sorts of things... I've always been very informal with my people in the way I speak. Some say I neither sound like chief of army nor like minister," he laughs when asked about it.

"But I did nothing to be ashamed of. I don't make fun of people. To those people who know me, they say 'He's always been like that.' "

It's too early to tell whether leaving the army for politics has been worthwhile or not, he says. "I don't know, even till the day I get out of this world, whether I will be able to tell. It is not something I evaluate on a daily basis, I just try to do the best with what I have. Maybe that absolves me from having to calculate; too many things are beyond my control. You hope to do the correct things, you want to do what you believe in, but whether it is correct or appropriate, only time will tell."

Naturally, adjustments have had to be made. "On Saturday, you send the children to activities, go to your constituency activities, hope you can fetch them when you come back," says the father of a 12-year-old girl and two boys, aged 4 and 1-1/2.

"You always try not to be unfair to your own children, your family. They walk the journey with you, without them, it would be very difficult to walk that journey. And it's not an easy journey. There will be brickbats, there will be bouquets, you take them all as they come."

But, he quickly adds: "Maybe I shouldn't say this. Maybe I should say 'Actually, it's such a good life!' so that good people all come and join."


Minister for Social and Family Development and Second Minister for Defence, 44, married with three children

1988: Awarded SAF (Overseas) and President's Scholarship to read Economics at Christ's College, Cambridge University, UK; Graduated with first-class honours. Also completed the Sloan Fellows Programme at Massachusetts Institute of Technology (2005) on the Lee Kuan Yew Scholarship

2007-2009: Chief Infantry Officer

2009-2010: Chief of Staff of Joint Staff

2010-2011: Chief of Army

May 2011: Left the SAF, elected MP for Tanjong Pagar GRC. Appointed Acting Minister for Community Development, Youth and Sports (till Oct 2012) and Minister of State for Information, Communications and the Arts (till July 2012)

Aug 2012: Appointed Senior Minister of State for Defence

Nov 2012: Appointed Acting Minister for Social and Family Development

Sept 2013: Appointed Minister for Social and Family Development and Second Minister for Defence

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