Invest in social foundations of economic prosperity, says SM Tharman

Senior Minister Tharman Shanmugaratnam speaking at British think-tank Institute for Government's 10th anniversary conference in London on June 12, 2019. PHOTO: MCI

LONDON - Society needs a moving escalator where everyone is moving up, and policymakers must bear this in mind in the basic design of economic and social policies, Senior Minister Tharman Shanmugaratnam said here on Wednesday (June 12).

During the keynote address of British think-tank Institute for Government's 10th anniversary conference, he stressed the need to be concerned about inequality and social mobility, with the best ways to tackle these issues being "absolute growth of incomes and absolute mobility that takes all people up towards something that they want to achieve better in life".

Mr Tharman, who is also Coordinating Minister for Social Policies, said: "It is much harder to address the inequality or to spur social mobility if the escalator is stationary... We need a moving escalator where everyone is moving up because that is the best way you can get the fluidity in society as well.

"That is the best way you (can) accept that while some people are going to move ahead, some people are going to move down, but we are all moving up. It relieves a great deal of anxiety of the broad middle (class)."

Mr Tharman is in London on a five-day working visit, keeping up the momentum of bilateral exchanges since the launch of the Singapore-United Kingdom Partnership for the Future in January.

In his speech, he also highlighted that the loss of trust in governments, the loss of faith in markets and the lack of a sense of togetherness and solidarity are "undermining the quality of democracies in a way that... is very likely to end in a bad place".

A "fresh and bold ambition" is required to tackle these issues, which include growing opportunities and investing in the social foundations of economic prosperity to "spread opportunities and give everyone a fair chance of taking these opportunities and achieving a decent and dignified life".

He also touched on key orientations for policies including the importance of investing upstream, intervening upstream in areas such as education, healthcare and neighbourhoods; paying more attention in fiscal policy to public goods and the long term; forming a new narrative that must involve a role for collective responsibility and the role for personal and family responsibility; and the need to combine moral purpose with practicality.

He shared that inclusive neighbourhoods are "the secret sauce of Singapore's social and economic model", explaining the model of housing development estates where there are no gates and where everything from the playgrounds and parks to the eating facilities and transport are public.

He added: "Having people of different ethnic backgrounds grow up together requires some intrusive rules, where the market and market pricing reflects the fact that every neighbourhood must have that mix.

"But without that intrusive policy, we would not have achieved the degree of social harmony that we have in Singapore today, and avoided the very large problems that we see elsewhere, that I would say it is not more intrusive than some of the things that you are now having to do in other societies, as a result of the gulf... between people."

He also spoke about the importance of "lifelong learning" which can be viewed as a source of social mobility. He spoke of the need to stretch learning out through regular injects through a working person's career, as well as the importance of striking a balance between firm-specific training and training that is relevant to other industries, making reference to Singapore's SkillsFuture scheme.

On Wednesday evening, Mr Tharman officially opened Singapore's three-day bicentennial event, a multi-sensory garden in London's financial district, with Lord Mayor of London Peter Estlin.

On Thursday (June 13), he is scheduled to meet Britain's de facto deputy Prime Minister David Lidington, Chancellor of the Exchequer Philip Hammond, and Shadow Chancellor of the Exchequer John McDonnell in separate sessions.

Correction note: This story has been updated for clarity.

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