Budget debate 2018

Parliament: MPs share thoughts on tackling social inequality during Budget debate

A crowd crossing a traffic junction along Ang Mo Kio Avenue 3 near an MRT station.
A crowd crossing a traffic junction along Ang Mo Kio Avenue 3 near an MRT station.ST PHOTO: LIM YAOHUI
EXAMINE CAUSE OF INEQUALITY: "Can we say today that the lot of our poorer fellow Singaporeans is due to their lack of ambition or talent? Or does the system itself inadvertently make it difficult for them to succeed and thus perpetuate inequality?" -
EXAMINE CAUSE OF INEQUALITY: "Can we say today that the lot of our poorer fellow Singaporeans is due to their lack of ambition or talent? Or does the system itself inadvertently make it difficult for them to succeed and thus perpetuate inequality?" - WORKERS' PARTY CHAIRMAN SYLVIA LIM
EVERYONE PLAYS A PART: "At the end of the day, bridging a class divide can only truly happen if Singaporeans work together to ensure that every single child from a low-income family is equipped with the perseverance, confidence and resilience to succ
EVERYONE PLAYS A PART: "At the end of the day, bridging a class divide can only truly happen if Singaporeans work together to ensure that every single child from a low-income family is equipped with the perseverance, confidence and resilience to succeed." - NMP GANESH RAJARAM

When it came to the issue of a class divide, Parliament was hardly a House divided, with MPs from both sides of the aisle and Nominated MPs (NMPs) rising to speak on the matter.

Social inequality was the hottest subject debated yesterday, with nearly half of all MPs who spoke bringing it up. Some called for more progressive tax policies and further studies to be done. Others said the problem is one the Budget is already addressing.

But all were in agreement on one thing: It is an important issue.

Several MPs cited a recent study by the Institute of Policy Studies, which concluded that the sharpest division in Singapore now is along class lines, and not race or religion.

NMP Kuik Shiao-Yin called social inequality "a deeply emotional issue" for youth, and "one of the biggest issues that they care about".

"They can (see) the class differences in everyday, ordinary interactions, because it is the difference felt at the doorway between the teenager who gets to order from Foodpanda and the teenager who must ride through the rain to deliver food to him," said Ms Kuik.

Workers' Party chairman Sylvia Lim questioned if inequality has become entrenched in Singapore due to government policies.

  • Scope for wealth tax

  • High-income earners could be taxed more as there is room to do so when compared with other economies, said Dr Intan Azura Mokhtar (Ang Mo Kio GRC). She presented these figures:

    Personal income tax*:

    •Taiwan: 40 per cent (for those earning an annual income over $203,000)

    •Hong Kong: 17 per cent (for those earning an annual income over $33,000)

    •Malaysia: 28 per cent (for those earning an annual income over $335,000)

    •Singapore: 22 per cent (for those who earning an annual income over $320,000)

    *These are the maximum tax rates for the assessable income stated.

    Suggestion: Dr Intan suggested raising Singapore's rates to 24 per cent for those earning between $500,000 and $1 million, and 26 per cent for those earning beyond that.

    Corporate tax:

    •Taiwan: 17 per cent

    •Hong Kong: 16.5 per cent

    •Singapore: 17 per cent

    Suggestion: Dr Intan suggested that firms earning over $1 billion annually can be taxed 17.5 per cent to 18 per cent.

    Ng Jun Sen

She asked if poor families are given adequate support to care for children, whether education policies penalised those without a leg-up in pre-school, and if housing policies "unjustly discriminate" against those who are divorced.

"Can we say today that the lot of our poorer fellow Singaporeans is due to their lack of ambition or talent? Or does the system itself inadvertently make it difficult for them to succeed and thus perpetuate inequality?" she asked.

The Aljunied GRC MP called for the Government to commission a longitudinal study to track the fate of families, in order to "dig deep into the daily lives of poor Singaporeans and evaluate the reasons why they do not seem to be able to catch up with the rest of society".

Ms Lim said: "The Government has noted in the past that we must not allow an underclass to form, and so the Government has to show commitment to this goal."

People's Action Party MP Ang Wei Neng (Jurong GRC) said he agreed with Ms Lim on the need for a study on social mobility, but did not agree with her suggestion that the Government is not doing anything to help the poor.

In response, Ms Lim said she was not suggesting that the Government did not have schemes to help those with lesser means, and was only asking about efforts made to study the issue of social mobility.

Several MPs also commented on how the goods and services tax hike of 2 percentage points after 2021 would affect poor and middle-income households.

To counteract this, suggested Dr Intan Azura Mokhtar (Ang Mo Kio GRC), more progressive measures such as a wealth tax should be implemented (see related story).

"Taxes seem to weigh heavily on the minds of many Singaporeans, in the lead-up to the Budget announcement," she said, adding that many were worried about the added burden of tax hikes.

Ms Jessica Tan (East Coast GRC) said that Singapore's economic growth must come with the ability of all Singaporeans to achieve social mobility.

 
 

She touted how innovation, a key focus in the Budget, could be effective in ensuring social mobility. "In this new world, with the shifts we are facing, what we are seeing is even when you don't have the legacy, disruptions allow people the opportunity to do better."

Mr Christopher de Souza (Holland-Bukit Timah GRC) said the Budget should be flexible - providing assistance to those who need it, but not discouraging prosperity and diligence.

NMP Ganesh Rajaram turned to his own experience to underscore the pain of a class divide. He recounted his sense of being the odd one out when he went from a non-elite secondary school to an "elite" junior college. In the end, he found friends through school sports.

Mr Ganesh called for more opportunities for children of all backgrounds to mix.

"At the end of the day, bridging a class divide can only truly happen if Singaporeans work together to ensure that every single child from a low-income family is equipped with the perseverance, confidence and resilience to succeed," he said.

"We must also create more opportunities for children of all income backgrounds to mingle and build lasting friendships."

A version of this article appeared in the print edition of The Straits Times on March 01, 2018, with the headline 'MPs share thoughts on tackling social inequality'. Print Edition | Subscribe