MPs propose poverty line, wealth taxes during day 1 of debate on President’s Address

SINGAPORE: The introduction of an official poverty line, wealth taxes and other forms of support for workers amid rising economic uncertainties were among topics raised on the first day of the debate on the President's Address.

Fourteen Members of Parliament (MPs) spoke during the parliament sitting that lasted for about five hours on Monday (Apr 17).

Last week, President Halimah Yacob said Singapore must ensure a broader and more open meritocracy that works well for all Singaporeans.

While meritocracy has provided opportunities, societies tend to become more stratified and less socially mobile over time. This means Singapore has to rethink its approach to education and work, said Madam Halimah as she laid out the key priorities for the remainder of the 14th parliament.

She said Singapore must re-examine how society rewards different skills and talents, and accord greater value to those who are skilled with their hands, as well as those with the social and empathetic traits to excel in jobs such as caregiving or community service.

Also speaking on Monday, Deputy Prime Minister and Finance Minister Lawrence Wong said Singapore's concept of meritocracy remains too narrow and it needs to refresh its mindset about schools and grades.

Nominated MP Raj Joshua Thomas said meritocracy has been one of the key contributors to Singapore’s success, but it has also resulted in “unintended consequences” such as how professions of the mind are prioritised over professions of the hands with “significant differences” in wages.

He called for more recognition to be given to the work done by those in “practical” professions, and one way is for wage increases under the Progressive Wage Model (PWM) to be accelerated.

“Rising wages will help to effect the shift in our definition of merit by showing that the work done by these workers, even if not generally considered work of the mind, is also important and worthy of reward,” he said.

Mr Thomas, who is also the president of the Security Association Singapore, also suggested that the PWM be tweaked to further incentivise employers to redesign jobs and upskill their workers.

MORE TAX ON WEALTH

Noting that intergenerational wealth transfers may give rise to unequal access to opportunities, Mr Thomas mooted the idea of a “limited inheritance tax” for properties that are inherited and have a value of S$5 million and more.

“The percentage (of the) tax should be higher, the more expensive the property inherited is,” said the NMP, adding that “appropriate exemptions” can be made such as for beneficiaries with special needs.

Currently, one does not need to pay tax for inheriting a residential property in Singapore.

MP Seah Kian Peng (PAP-Marine Parade) said the rich can be taxed further, especially for specific expenditures such as “super cars”.

He called for the authorities to consider a separate category of Certificates of Entitlement (COEs) for luxury cars that cost more than S$1 million.

ESTABLISHING A POVERTY LINE

MP Jamus Lim (WP-Sengkang) called for the establishment of an official poverty line in Singapore, adding that the lack of one is “both puzzling and exasperating”.

“Targeting the poor is impossible, or at least imperfect, without an official transparent benchmark,” he said.

Associate Professor Lim called for a committee, comprising representatives from the Ministry of Social and Family Development, civil society and academia, to be set up to determine the appropriate poverty line in Singapore.

He said that thresholds for government assistance, especially ComCare, should then be pegged to this figure. At the moment, there are varying thresholds for these various schemes which Assoc Prof Lim described as “confusing”.

ComCare, which provides short- to medium-term financial aid for low-income individuals and families in need, can also be refined, he added.

For example, the current approval process can be “intrusive, onerous and demeaning”, while the payout is “modest” and often granted for an “unbearably short time”, said the opposition MP.

MP Desmond Choo (PAP-Tampines) disagreed, saying that there are inherent problems with having a single poverty line, such as the “unintended cliff effect” of excluding those who exceed the threshold or missing out on other issues faced by needy families such as ill health.

“Experience from other countries has also shown that it is hard to simplify to just one figure, and there's a tendency for people to want to stay below that figure,” he added in his speech.

Mr Choo said while he agrees that Singapore can do better in supporting the poor, it does so by shaping its policies to give more to those who have less, as well as cater to different needs.

“An approach of providing support based on the varied needs of Singaporeans and their families might work better than a single poverty line,” he added, although he agreed that the application process for the assistance schemes can be further streamlined.

TWEAKS TO EDUCATION SYSTEM

In terms of the education system, MP Gerald Giam (WP-Aljunied) spoke about the negative effects of examinations and how it remains a major feature of the system, despite changes like subject-based banding.

“While subject-based banding is less rigid than streaming, it is still based on the same principle: A student has to meet a specific test score in order to study the subjects they are interested in,” he noted.

He reiterated WP’s proposal for a 10-year through-train programme from Primary 1 to Secondary 4, as an option for parents who want to bypass the Primary School Leaving Examination (PSLE).

Mr Darryl David (PAP-Ang Mo Kio) similarly urged the Ministry of Education (MOE) to give Primary 6 students a final combination of coursework and PSLE scores, which he said is already practised in programmes such as the International Baccalaureate.

Meanwhile, Mr Vikram Nair (PAP-Sembawang) said it would be good to have a system that “places less emphasis on tuition”, and that Singapore should ensure all children attend preschool by making it compulsory or having strong measures in place to encourage universal attendance.

Mr Giam from the WP further spoke at length about financial literacy. He noted that, according to surveys by the private sector and MoneySense, Singaporeans lack the financial know-how and confidence to manage their finances and plan for the future.

Among others, the MP suggested that the government establish a national financial education programme under MOE to provide “proactive and comprehensive” financial education for Singaporeans of all ages.

“Financial literacy should be included as a standalone subject taught in schools, as good financial habits need to start from young. It does not need to be an examinable subject,” he added.

Mr Thomas the NMP suggested creating opportunities in Singapore’s education system for students to be exposed to practical professions, in order to appreciate that “all work is good work”.

“Perhaps one day, we will see our students seeking internships or apprenticeships as technicians, arborists or waiters, and not just in law firms and banks.”

ECONOMIC UNCERTAINTIES AND JOBS

Several labour MPs also rose to speak about financially supporting workers, such as introducing unemployment support for those who have been retrenched or forced to leave their jobs.

This can be “linked to training and job search to preserve the work ethos of the workforce”, said Mr Choo, who is assistant secretary-general of the National Trades Union Congress (NTUC).

The government can also enhance the Career Conversion Programmes by increasing allowance and income support during the conversion process, and extending the programmes to self-employed workers, added Mr Choo.

As for helping people to learn new skills while employed, one way is to increase absentee payroll funding and the overall S$100,000 annual cap for companies. This will allow firms to send workers for training while receiving subsidies for such costs, Mr Choo said.

“The global workforce has come under considerable strain. The Singapore workforce is similarly affected,” he added.

“As uncertainty becomes more pervasive, we need to restore confidence by addressing underlying structural causes of such anxiety.”

Ms Yeo Wan Ling (PAP-Pasir Ris-Punggol), who is director of NTUC’s women and family unit, called for more to be done in supporting working mothers.

“Today, women are not an invisible force in the workplace and indeed, a force to be reckoned with. However, domestic and caregiving norms at home, which have been in place for generations, have not caught up with these great strides in the workplace,” she said.

“Should women still be expected culturally to be the sole or main caregivers at home while balancing their careers? More practical support must be given to help move the needle and (shift) cultural caregiving norms,” Ms Yeo added.

The debate resumes on Tuesday.