A more volatile and uncertain environment

At the opening of the last session of Parliament in June 1997, I spoke on Singapore 21 and our vision for a new era. But visions must confront realities, and in case our feet left the ground, I cautioned that there were many things in the future we could not possibly foresee.

One month later, a financial crisis erupted in Thailand, swept across Asia, and devastated several economies. It permanently changed the strategic landscape in the region. The forces of change that the regional crisis unleashed are still at work, and we do not yet know their full impact.

Who could have foreseen the traumatic changes in Indonesia, or that Singapore, at the UN's and Indonesia's invitation, is participating in the INTERFET mission in East Timor? What will Indonesia be like after 20 Oct when a new President is chosen? What will the region be like in 5 years' time?

In addition, technology and globalisation will continue to transform businesses, economic structures and human society. We have to face intense economic competition in an increasingly borderless world, and manage change in our society as well.

This volatility and uncertainty in our regional environment and the rapidity of changes in the world, are realities we have to live with.

Our response should be strategic and robust. In essence, we shall focus on our people, investing in them, enhancing their capabilities, stretching their minds, stimulating their creative and entrepreneurial spirit, and harnessing their ideas and energy to build a first-world economy and a world-class home. This is our bold strategy to tackle the challenges ahead.

A first-world economy and a world-class home are not two separate goals. They are two sides of the same coin. We need the resources from a sound, competitive economy to build a world-class home, and we need a world-class home to anchor Singaporeans to create a first-world economy for Singapore.

Between the two facets, a first-world economy is the easier goal to achieve. Our economic foundation is strong and our reputation as a pro-business economy is excellent. By implementing the right policies consistently and building new capabilities, we will succeed in becoming a first-world economy.

Building a world-class home presents a trickier challenge. It is not just about nice houses, modern conveniences and bright city lights. It is about people, relationships, motivation, commitment, passion, dedication, and determination. The irony is that the more Singapore improves its infrastructure and amenities, the less unique and indistinguishable from other cities it becomes. Singapore risks becoming like one of those well-run, comfortable international hotels which successful business executives check in and out.

What makes a home different from a hotel is where the heart is. Most homes are less comfortable than a hotel, but they are where the people feel they belong, where they are king and where they can decorate and arrange the furniture the way they like. This, in essence, is what distinguishes a home from a hotel. Singapore is a place where Singaporeans can be themselves, where they can make a difference, and where they care for one another and rally together when faced with challenges. The best home for Singaporeans is a world-class home.

Here, I want to highlight two demographic trends which may undermine our effort to build our world-class home.

The first trend concerns the growth of the population. The statistics show clearly that we are not replacing ourselves. This is a serious problem. The Government has warned against this trend 12 years ago. We tried to reverse it but have not been successful.

Our Total Fertility Rate or TFR has fallen steadily since 1990, despite our scrapping the "Stop At Two" policy and encouraging married couples to "Have Three Or More If You Can Afford It". The TFR is a fertility indicator which shows whether the the number of children a couple would have in their lifetime under current fertility patterns. For a couple to replace itself, they have to produce two children. population is replacing itself. A population is considered to be replacing itself if it can maintain a TFR of about 2. This means a woman in our population would on average have 2 children in her lifetime. Our TFR has fallen steadily from 1.87 in 1990 to 1.5 in 1998.

1998 was the Year of the Tiger so one would not expect a large number of births. But the Year of the Rabbit has not been prolific either. The number of births in the first eight months is, in fact, 3% lower than that of the same period last year. Unless the Rabbit surprises us in the next three months, the TFR for 1999 is likely to fall below 1.5. If this trend persists, and it is likely to be the case, our resident population of 3 million will grow to about 3.5 million by 2025 and then start to decline. The proportion of older people will also be far higher compared to what it is today. This means that the 3.5 million Singaporeans in 2025 will not even be as economically productive as the present 3 million because of the change in demographic structure.

In 1987 when I announced the Government's New Population Policy, I also expressed the hope that there would be at least 50,000 births a year. This provides the minimum cohort size to sustain our economy, defence and other manpower needs. Our actual birth numbers were nowhere near the 50,000 mark in the past 5 years. In 1998, the number of births came to only 43,664, far short of the target that the Government set.

If this declining fertility trend persists, and it is likely to be the case, our citizen population of 3 million will grow to about 3.5 million by 2030 and then start to decline. Ang Mong Seng and Dr Michael Lim raised the needs of the old. Their needs will become even more acute after 2030. The proportion of older people then will be far higher compared to what it is today. There will also be fewer people in the working-age group. This means that the 3.5 million Singaporeans in 2030 may not produce sufficient wealth to look after the needs of the old and society in general. Can a shrinking population sustain a first-world economy?

I shall not elaborate on the reasons for the declining TFR. They have a lot to do with urbanization, education, changing lifestyles, late marriages and singlehood.

The statistics also show that the more educated mothers are, the fewer kids they are likely to have. The more educated have on average a family size that is about 15% smaller than those with lower education. As the educational standard of our people will go up, we must expect our TFR to fall even further. There are many reasons for the declining TFR - urbanisation, education, changing lifestyles, singlehood and late marriages. Having babies also involve personal choices and trade-offs. I am not optimistic that we can achieve a significant increase in fertility level. But we must never give up trying to get Singaporeans who can afford it to have more children. Dr Jennifer Lee talked about incentives for fathers. I am not sure paternity leave is the solution because our main problem is the large number of highly-educated women who remain single. Among those with post-secondary qualifications, about 1 in 5 women is likely to remain single in her life time. So we must try to increase the marriage rate of our women, particularly those with higher education.

Given that our citizen population is not replacing itself, we have no choice but to top up our population with new immigrants. They provide a much-needed boost to our manpower strength, augmenting shortfalls in the productive age groups and increasing our talent pool. Since we have to take in new immigrants, we should be selective, admitting only those with skills, high education and talents, from wherever they are. This way, we make sure that foreigners who become PRs and Singaporeans are a definite plus to our country. These foreign-born Singaporeans will help enhance the vibrancy and dynamism of our economy and society.

We should make every effort to absorb these foreign-born Singaporeans into our society. We should strengthen their commitment by giving them a sense of ownership of Singapore too. This inclusive approach will ensure that a generation from now, these new Singaporeans and their children will be as nationalistic as any one of us. Their children will have to do national service as Singaporeans.

This brings me to the second trend - the increased number of Singaporeans going overseas. I asked the Ministry of Manpower how many Singaporeans are overseas on a long-term basis. The Ministry came up with an estimate of 150,000, which included working adults and their dependants, emigrants and students.

Based on the number of Good Conduct Certificates issued by the Police, each year some 2,000 Singaporeans pack up their bags and emigrate. More than half are females, many of whom married foreigners and leave Singapore to join their husbands. There are also some 6,000 applications to MINDEF each year for reservist training deferment on grounds of overseas employment of duration longer than 6 months.

Whether we like it or not, more Singaporeans will take wing, given the pace of globalisation and their own personal mobility. As Singaporeans become even more cosmopolitan, the issue of concern to us is whether they will become less rooted to Singapore. We now have to even compete for the hearts of Singaporeans against attractions elsewhere.

With this background, you will appreciate better the significance of the statement - every Singaporean matters. There are not many of us to build and protect our home. So we have to provide every Singaporean with the opportunity to develop his or her potential to the fullest. We have cut down our school dropout rate. So it shocked me to learn that each year some 1,500 children, or 3% of a cohort, are not even registered for Primary One in national schools. The Ministry of Education has argued against compulsory education because the number of non-registration is considered small. But every Singaporean matters. And every Singaporean child should be given the same head start in life, ie. to attend school. I favour compulsory education, at least up to Primary 4 level. Beyond that, if a child does not want to study, or wants to drop out, there is little we can do. I am asking the Ministry of Education to consider the introduction of compulsory education.

We have given Singaporeans a physical stake in the country - home-ownership, upgrading of HDB estates, shares of privatised government companies, cash top-up of their CPF and Medisave accounts, good infrastructure and ample facilities for sports and leisure activities.

We must now give Singaporeans an emotional stake as well. This is why I have made consultation and participation one of the Government’s major goals. It is to give Singaporeans a bigger say in their own future, and thus bond them to Singapore. We want Singaporeans to sprout ideas to make Singapore better, take responsibility for their ideas and make them work.

The Government has successfully tapped private sector expertise for major Government-led committees such as the Committee on Singapore’s Competitiveness of 1997 and the Financial Sector Review Committee of 1998. We found the private sector involvement very useful, both in terms of coming to grips with the problem and of forging a consensus on the way forward. We will continue to involve the private sector in major review of important policies, not just in economics, but also in non-economic areas.

At the same time, we have systematically opened up more channels for citizens to participate, to involve them in building a world-class home. Besides writing to the press, Singaporeans can channel their views through the Feedback Unit, Service Improvement Unit, Institute of Policy Studies, Members of Parliament, dialogue sessions, GPC resource panels and so on.

The recently-completed Singapore 21 exercise was noteworthy for its involvement of Singaporeans from all walks of life, in particular, younger Singaporeans. Their vision and recommendations are now accepted as national policies. Due to such extensive and active participation, we were able to come up with a Singapore 21 vision that fully reflected the needs and aspirations of our people. The opposition may dismiss Singapore 21 as empty elections talk. The point is it is the collective product of Singaporeans, and the opposition has nothing fresh to offer.

Each year, thousands of Singaporeans submit their suggestions and views to the Feedback Unit. In 1997, we took the feedback process further by organising regular feedback contributors into groups. So far, 27 feedback groups have been formed. These feedback units are the people sector’s equivalent of Quality Circles and Work Improvement Teams. We now want to go beyond feedback on how policies affect the people to encouraging Singaporeans to submit constructive suggestions and new ideas.

In the Civil Service, we reward Work Improvement Teams when they submit cost-saving ideas. Singaporeans may wish to form themselves into similar work improvement teams to submit ideas on any aspect of government. We will introduce an award scheme to give symbolic recognition for useful ideas put up by Singaporeans, either individually or as a team. Big ideas or small ideas, let them flow. Turn Singapore into a nation of ideas.

Here, let me explain what I expect of consultation and participation, to avoid misunderstanding and cynicism.

First, consultation does not mean that every Singaporean must be consulted, or that every policy discussed with the public before it is implemented. That is not practical. If it were practical, you would not need representative government. Parliamentary democracy means electing a group of Members of Parliament to represent the people's interests. The Government consults the people mainly through their MPs, and is answerable to Parliament. That is why having good MPs who can understand the concerns and solve problems for the people is important.

Second, when the Government consults, it is with people who have good knowledge of the subject. It consults people who can help improve the formulation of policies. It is not necessarily with people who may be affected by the policy. Every policy of the government affects the whole population. No government consults its citizens on every policy.

Third, Singaporeans must not expect every suggestion and idea of theirs to be accepted. If a proposal is well argued, it will get a fair hearing. Even if it is rejected, it is also valuable if it has challenged existing assumptions and thinking and provided the opportunity for the Government to reaffirm its policies.

Fourth, while Singaporeans will have more space for political debate, it does not mean that the Government is vacating the arena. Anyone who wants a policy changed, or to set the national agenda, must expect a debate with the Government. Every Government policy has been carefully considered before implementation. But anyone is free to challenge it. However, he must expect a response from the Government. The Government will defend its policies, principles and programmes openly and robustly. Not to do so is contrary to the whole purpose of public debate. If the Government remains silent, views contrary to what the Government believes is right, will soon prevail. This will confuse the ground because the public may think the Government, by its silence, agrees with the contrary views.

Zulkifli Baharudin said that "being thick-skinned must certainly be one of the necessary pre-requisites for anyone intending to engage in public debate". No, we do not want Singaporeans to develop hides. Even the thickest hide can be stripped. We do not want a querulous population with thick skins. An important pre-requisite for public debate is a keen mind - how sound an idea is, and how it will benefit public interests.

Let me add that those without mischievous intention or a hidden agenda need not fear a rebuttal from Government. They should not be discouraged to speak up simply because Government may challenge their views. Constructive debate is a necessary part of the process for determining what is best for Singapore. This is what consultation and participation is about.

But those out to undermine the Government, or to wrest political power from the ruling party, is another matter altogether. They must expect a political response from the Government. This political response can be extremely robust because whoever wins in the political arena will decide the future of Singapore. The PAP will guard its turf jealously, not for itself, but for the good of Singapore.

Singapore will always be like a boat shooting the rapids. Those who have done white-water rafting would understand my analogy. They will understand the importance of the steersman as the boat negotiates the rocks in a fast-flowing, frothy river. The Government is like this steersman or captain.

I have experienced the thrills and dangers of white-water rafting in New Zealand. Once in the boat, I put my faith in the captain and do what he told me to do. Consultation took place before I stepped into the boat. Once I was in, I had to play my part as a member of the crew.

Do not think that Singapore is sailing in calm waters and therefore we can take risks. Or that we are freer to rock the boat because we now have a sturdier boat and each one of us is equipped with a safety helmet and a life jacket.

The political landscape of our neighbours is changing. It will affect the strategic and security environment of our region. And however well-governed Singapore is, however strong our economy is, and however united our people are, we will be reminded from time to time that we are a little red dot, or an adik, or a predominantly Chinese population in a Muslim region.

This does not mean we have to have a siege mentality. It means we must be robust, forward-thinking and innovative to break out of the confines of our geography, which is why we are changing the way we teach in schools, and getting our people to be more resourceful, creative and better informed.

Our revamp of the education system will lead in the future to a questioning electorate. A questioning electorate will demand a higher performance from Parliament and the Government. It will demand more political space and debate.

Will such a population throw up an alternative party to challenge the PAP, or will it throw up more good men and women to join or support the PAP and help it carry on with its work?

Does it matter so long as it produces a group of leaders who are honest, committed to Singapore and more competent than the PAP leaders? Does it matter if it is a population which understands Singapore's uniqueness and vulnerabilities and backs its leaders?

But I do know that to survive in an intensely competitive borderless and volatile world, it does matter if we do not have a well-informed, thinking, resourceful, innovative and cohesive population with the resolve to keep Singapore going.

This is why for the remaining term of this Parliament, we are emphasising people - numbers, quality, commitment, relationships, roots, responsibility, freedom, participation and passion. But more than talking and consultation, there must be action. This is where I salute the thousands of social workers, volunteers, grassroots leaders and others who do more than talk. They go about quietly, looking after the interests of their community and fellow Singaporeans. They are a critical part of our people sector. The Government values such people.

Singaporeans, especially the younger generation, must believe firmly in what Singapore stands for - our ideals, ethos, principles and values, and be willing to do their part to safeguard our way of life. They have done well in life because the Singapore system offers them a level playing field, abundant opportunities, and a helping hand to develop their potential to the fullest. Singapore’s future is in their hands. They have to make a difference to Singapore and make us proud to be Singaporeans. This is what active citizenry is about.

If our hearts beat together for Singapore, we will succeed as a nation no matter what challenges lie ahead.

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