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Widening income gap a Singapore concern
SINGAPORE: Challenges of dealing with a widening income gap in Singapore are here to stay, say political watchers and economic analysts, while MPs say the key to narrowing the gap is up-skilling low-wage workers.
They were responding to the Prime Minister's New Year's message which highlighted the issue.
Singapore experienced strong growth in 2010, and economists say one group likely to benefit is the high income earners.
CIMB regional economist Song Seng Wun said: "As a result of the very strong growth, what you normally find is that the top 20 per cent of income earners will generally ride on the growth and benefit from it far more than the lower 20 per cent.
"Benefiting them are things like wealth from appreciating assets such as properties, whereas in the lower income group, you do not have that kind of appreciation of asset.
"If you're... in the bottom 20 per cent (group), your salary is relatively stable (but) you're only getting that much, whether (the) economy is growing 15 per cent or four to six per cent.
"(But) if you're (in) the top 20 (per cent group), you'll likely ride (on) the growth and the kind of opportunity that presents much more than a bottom 20.
"... As a result after an exceptional year, you do find that income gap will widen very significantly. Perhaps with a return to normalcy, we will see a little bit of return in the gap itself".
Some of the issues which Singaporeans are always concerned about include inflation and the cost of living.
These can be a perennial concern for the lower income group.
MPs whom Channel NewsAsia spoke to say they intend to raise this issue during the Budget debate and will be calling on the government to extend whatever support it can to help lower income Singaporeans.
And this is where Workfare -- a key pillar of Singapore's social security landscape to provide support for low-wage workers so they have the best chance to progress -- comes into play.
MPs say the Workfare has been a great help in encouraging workers to be gainfully employed, to benefit from the payments.
MP for Jalan Besar GRC Denise Phua said: "What we need to do is to move from these broad-based strategies to more targeted help, for example, specific industries and specific segments of low wage workers.
"(We can) then hone in...and understand the low wage workers' families, so (as) to make sure that (the) poverty spiral can be broken.
"One area to target is to ensure that children from low-wage families have specific support in terms of tuition (and having access to) computers, to make sure they can be pulled out from the poverty spiral.
"We have sufficient numbers of helping agencies (such as) the CDCs (and) the family service centres. What we need to do now is to tighten the coordination of these helping agencies to make sure that help indeed reaches those who need to be helped."
GPC Chair for Community Development, Youth and Sports Seah Kian Peng said: "One part is to keep the economy running and booming like what it is now, just like what we have experienced last year.
"What it means is that unemployment is very low and we know that the majority of people are earning a salary and as the economy booms, the government will be in a position to also, in any budget, consider how it could possibly distribute and share the growth with as many Singaporeans as possible.
"The other part is rallying the community (including) those who have done well and are successful, (to) make life better for those (who are) not as successful.
"Singaporeans are, by and large, a generous lot; corporate philanthropy is there and I hope individual philanthropy will also be on the rise".
Meanwhile, MPs say they will urge the government to continue with measures already in place, like the GST Credits and various rebates, to help low income Singaporeans.
SINGAPORE: Challenges of dealing with a widening income gap in Singapore are here to stay, say political watchers and economic analysts, while MPs say the key to narrowing the gap is up-skilling low-wage workers.
They were responding to the Prime Minister's New Year's message which highlighted the issue.
Singapore experienced strong growth in 2010, and economists say one group likely to benefit is the high income earners.
CIMB regional economist Song Seng Wun said: "As a result of the very strong growth, what you normally find is that the top 20 per cent of income earners will generally ride on the growth and benefit from it far more than the lower 20 per cent.
"Benefiting them are things like wealth from appreciating assets such as properties, whereas in the lower income group, you do not have that kind of appreciation of asset.
"If you're... in the bottom 20 per cent (group), your salary is relatively stable (but) you're only getting that much, whether (the) economy is growing 15 per cent or four to six per cent.
"(But) if you're (in) the top 20 (per cent group), you'll likely ride (on) the growth and the kind of opportunity that presents much more than a bottom 20.
"... As a result after an exceptional year, you do find that income gap will widen very significantly. Perhaps with a return to normalcy, we will see a little bit of return in the gap itself".
Some of the issues which Singaporeans are always concerned about include inflation and the cost of living.
These can be a perennial concern for the lower income group.
MPs whom Channel NewsAsia spoke to say they intend to raise this issue during the Budget debate and will be calling on the government to extend whatever support it can to help lower income Singaporeans.
And this is where Workfare -- a key pillar of Singapore's social security landscape to provide support for low-wage workers so they have the best chance to progress -- comes into play.
MPs say the Workfare has been a great help in encouraging workers to be gainfully employed, to benefit from the payments.
MP for Jalan Besar GRC Denise Phua said: "What we need to do is to move from these broad-based strategies to more targeted help, for example, specific industries and specific segments of low wage workers.
"(We can) then hone in...and understand the low wage workers' families, so (as) to make sure that (the) poverty spiral can be broken.
"One area to target is to ensure that children from low-wage families have specific support in terms of tuition (and having access to) computers, to make sure they can be pulled out from the poverty spiral.
"We have sufficient numbers of helping agencies (such as) the CDCs (and) the family service centres. What we need to do now is to tighten the coordination of these helping agencies to make sure that help indeed reaches those who need to be helped."
GPC Chair for Community Development, Youth and Sports Seah Kian Peng said: "One part is to keep the economy running and booming like what it is now, just like what we have experienced last year.
"What it means is that unemployment is very low and we know that the majority of people are earning a salary and as the economy booms, the government will be in a position to also, in any budget, consider how it could possibly distribute and share the growth with as many Singaporeans as possible.
"The other part is rallying the community (including) those who have done well and are successful, (to) make life better for those (who are) not as successful.
"Singaporeans are, by and large, a generous lot; corporate philanthropy is there and I hope individual philanthropy will also be on the rise".
Meanwhile, MPs say they will urge the government to continue with measures already in place, like the GST Credits and various rebates, to help low income Singaporeans.
