Education is the best social welfare

This Part 1 of a three-part series on the cost of education in Singapore:

Part 1: Education is the best social welfare
Part 2: Making higher education affordable for all Singaporeans
Part 3: Funding a new education compact


One of the highlights of 2007 Budget speech was the introduction of the Workfare Income Supplement a new “pillar” of Singapore’s social compact. Workfare, as its name implies, is an innovative way of dishing out welfare to low-income citizens, while still incentivising them to remain employed.

Workfare is billed as an important measure to stem the increasing bifurcation of Singapore society between the “Haves” and “Have-nots”. Incomes of the bottom 20 per cent of workers have been stagnant (and even slipped) for years since the early 1990s, while the incomes of the top 20 per cent have powered ahead. This presents a serious problem which cannot be ignored — both for moral and political reasons. Recent history is replete with lessons of “proletariats” overthrowing their “bourgeoisie” ruling class because of grossly uneven and unjust wealth distribution. Even in democratic India, the BJP-led government was unseated at the 2004 polls by the grassroots-based Congress Party, despite claiming credit for India’s commendable economic development in the past decade.

The $400 million Workfare package to be dished out to low-income workers seems to have pleased almost everyone, including the Opposition. Based on media reports, Singaporeans could be forgiven for thinking that this is the panacea to our widening income divide. It is most certainly not.

I see Workfare as at best a stop-gap measure to keep low wage workers a little happier until the next election. The $40 increase in monthly take home income is not going to make much difference to their standard of living. Unfortunately, as long as these workers lack the high-value skills and competencies needed to power a globalised, knowledge-based economy, it’s hard to see how their incomes would ever increase significantly within their lifetimes.

With this stark reality in mind, attention should instead be focused on helping the children of low-income families succeed in life and move up the social ladder, while still continuing to disburse Workfare to their parents.

One of the most important keys to facilitate this social mobility for the next generation is education, and tertiary education in particular. The Government has taken pride in its self-proclaimed “meritocratic” system, whereby anyone, whether poor or rich, can rise to join the ranks of the elites in society if they achieve good enough grades in school to win scholarships to study in top universities around the world. The current system has succeeded in producing an elite ruling class in our society, but will continue to fall short of the Government’s goal of giving every Singaporean a role to play in this new innovation-driven economy.

The former president of Japanese multinational Matsushita remarked some years ago to then-EDB Chairman Ngiam Tong Dow that our educational structure had some brilliant individuals perched like eagles on high peaks, but the average education level of the rest was not high. He advised that Singapore should concentrate on educating the masses to raise the average level and not just focus on the top scholars. He said that to advance as a nation, we need “high broad plateaus, not solitary peaks”.

Singapore already has an excellent education system at all levels — primary, secondary, technical and tertiary. However, for the most part, it is tertiary education (i.e. universities and polytechnics) that will make the difference between those who make it to the middle income group and above, and those who will unfortunately remain in the “struggling-to-survive” group.

This is not to be elitist and dismiss O level or ITE graduates. I have no doubt that there will be some among them that have the entrepreneurial drive and determination to start business and make it big despite their lower academic qualifications. However, these will be the exception rather than the rule. Singapore will need more knowledge workers to power our economy. If companies can’t find these workers locally, they will have to search overseas and hire foreign talent. The globalisation train is steaming ahead, and there’s nothing we can do to stop it. Most manufacturing jobs and even technical jobs will be shipped out to China, India or Vietnam sooner than we think. No amount of labour protectionism will save these jobs.

To prepare our workforce for the knowledge-based economy, the Government must give as many students as possible the opportunity to study in polytechnics and universities. It doesn’t make sense for the Government to constantly carp at the lack of local knowledge workers and import wave after wave of foreign talent, when it should be putting in place a more long-term solution by providing more opportunities for Singaporeans to complete their tertiary education. Human capital development is the best form of social welfare, and an investment with an almost guaranteed return.

In the next post, I will make the case for greater funding for Singaporeans’ education, particularly those from lower income families, to ensure that none of them misses out on obtaining a degree or diploma because of financial constraints.

Author: Gerald Giam

Gerald Giam was a Non-Constituency Member of Parliament from 2011-2015. He is a member of the Workers' Party of Singapore and currently runs a technology consultancy which he co-founded. The opinions expressed on this page are his alone. Published by The Workers' Party, 701 Geylang Road, #04-02 Teambuild Centre, Singapore 389687

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