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The 2023 Budget has been described in mainstream and online media outlets as a "Robin Hood" budget, the Leader of the Opposition, Pritam Singh, said in Parliament on Feb. 22.

"Referring to it (the 2023 Budget) as such pits one group — high earners and the rich — against the lower and middle classes," he noted.

Singh, Secretary-General of the Workers' Party (WP), added that Singapore must guard against such a split in society.

"My view is that Singapore’s social compact must be one where we move forward together as one Singapore to tackle an unpredictable and potentially disruptive future," he elaborated.

Critical for the government to make the fight against inequality a central agenda

Singh was speaking at the debate on the 2023 Budget. Deputy Prime Minister and Finance Minister Lawrence Wong had delivered the Budget Statement earlier in Parliament on Feb. 14.

For Singaporeans "on the ground", there are clear social trends: a rapidly aging population, a belief that social mobility for younger Singaporeans contrasts markedly with that of their parents, and a view that meritocracy has developed a "perverse edge", allowing the well-off to move ahead much faster than the broad middle-class.

Such "forces", according to Singh, must be properly managed and it is therefore critical for any government to make the fight against inequality a central policy agenda, and intervene "decisively" to lift those at the bottom.

"It would be remiss of me to say that the government has not made moves in this regard," Singh said. He cited Wong highlighting the importance of helping disadvantaged children.

Danger of two Singapores emerging

The Leader of the Opposition added that if Singapore does not do more, a threat of "two Singapores" emerging may become a reality.

Singh said that one of these Singapores is connected to the world as a hub economy, where high salaries and opportunities abound. It is also a Singapore where both locals, and many foreigners power "diverse" nodes of the economy.

"This Singapore gives meaning to the promise and lure of Singapore and how we remain relevant to world. It is a Singapore that always strives to be at the cutting edge of global developments," Singh said.

"Other Singapore"

As for the other Singapore, it is a place where the majority of Singaporeans live, he added.

"It is one where there are perceptions of slowing social mobility, connected to the reality of high housing prices."

Singh noted that at present the prospect of upgrading to an upgrading to a condominium or a landed property is no longer as realistic for HDB home owners compared to previous decades. In addition, buying a car is an "out-of-reach" luxury for most people, he said.

Singh also gave the following description about the second Singapore:

"In the past, you may not have done well in school, but if you were prepared to slog and save, you could become rich and successful. Today, the view is that once you have not succeeded academically, even if you slog for years, success, let alone wealth, may not follow."

Both of these Singapores could easily become a reality which will cause societal friction, he added.

"Singapore is a tiny red dot and both these Singapores would unavoidably rub up against each other. There is no countryside to retreat to, where the pace is slower and prices of things are lower than in the city.

Human nature and the instincts of envy and chauvinism, and a narrative of haves and have-nots can quickly poison society and accentuate cleavages. With people living cheek-by-jowl, such views can easily take root and manifest themselves in cruel ways."

Striking a note of caution, Singh said that as much as the government endeavours to to keep society open and bring new businesses and opportunities, it is that second Singapore, where a very "broad middle" of Singapore lives and works and plays.

Singaporeans in the second Singapore therefore should never find themselves unmoored and cynical about the future of the country, he said.

Government has made some moves

Singh acknowledged that the government had made moves in this regard however, and noted that Deputy Prime Minister Lawrence Wong had spent time highlighting how disadvantaged children need an early leg up in his Budget speech.

Singh also pointed out that there were some within the bureaucracy who are "fixated" about keeping Singapore relevant to the world, and how to enlarge the pie while at the same time making sure it does not get smaller.

He said:

"Their efforts cannot and should not be underestimated or conveniently ignored. It is not lost on many Singaporeans including the Workers’ Party that it is because of these efforts and those of their forebears that we have the capacity to propose other redistributive policies for our fellow Singaporeans today."

Policies to address inequality

Singh also noted the moves in the Budget to better equalise opportunities through fiscal intervention such as raising taxes and duties for high-end property and luxury vehicles, on top of policies implemented in 2022 such as hikes in personal income taxes.

Singh said calling it a Robin Hood Budget would reinforce the perception of "two Singapores".

Singh also reiterated his call for redistribution to be at the core of government policies, by describing the WP's position as such:

"The Workers’ Party supports the idea of a progressive society where those who earn more pay proportionally more in taxes. Equally, we honour the centrality of a strong work ethic even as we are not only empathetic, but also sensitive, towards the disadvantaged and those who need extra support."

Addressing three areas from the 2023 Budget Statement

Pritam then focused on three aspects of the 2023 Budget statement.

Jobs-Skills Integrators, how is this different?

Firstly, Pritam addressed the new Job-Skills Integrators scheme, announced by Wong in his budget.

They are "labour market intermediaries" that can work with various stakeholders to optimise training and job placement.

Pritam noted that while the initiative “holds much promises” for job seekers, in order to see how the initiative might fare, one should look at past efforts, specifically in the engineering, resale and wholesale trade sectors.

Pritam questioned the results of previous training and placement efforts put in place to help workers with mid-career changes.

“So what has become of these training and placement efforts? An how are they qualitatively different from what the Deputy Prime Minister has proposed in the budget?”

Pritam referenced the 2016 press release on the Industry Transformation Map (ITM), which committed S$4.5 billion to the precision engineering sector with respect to digital manufacturing.

“We have yet to hear in this house a proper accounting of the success or otherwise of the first ITM," he said.

He also asked what Key Performance Indexes will be used to determine the effectiveness of the pilot Job-Skills Integrators and which agencies will “anchor” this initiative.

Commenting on the extension of paternity leave

Wong also announced the eventual doubling of paternity leave from two weeks to four in his Budget.

Pritam noted that while some employers in Small Medium Enterprises (SMEs) have a “legitimate concern” with the extension of paternity leave due to manpower and operational challenges, he hopes that employers can empathise with this move.

He brings up “Asian culture”, where time is needed to fulfil filial responsibilities. Pritam also said the move is welcome, and hoped that SMEs adjusts for male employees as they did for female employees on maternity leave.

Pritam also expressed his support for the extension of the Senior Employment Credit (SEC) up to 2025, as he believes that employers should be given more support to encourage more senior hires.

He suggested that with more mature workers, employers will be able to make up for the temporary absences of younger staff, and asked if the government has undertaken studies to consider the fiscal impact of raising the SEC.

“There must be an upside for employers as we undertake this cultural shift towards making the workplace more family-friendly,” Pritam said.

Raising the CPF monthly salary ceiling

Pritam noted that while his party supports the rise of the monthly CPF income ceiling to S$8,000, he still had a few questions.

He pointed out that many Singaporeans would not meet the World Bank's recommendation of an Income Replacement Rate of pensions of 53 per cent as many have their CPF funds “locked up” in housing.

He called for the government to “re-centre” the CPF system towards its “original purpose”.

“Achieving better retirement adequacy would require a hard look at how much the CPF system dedicates towards home ownership. More affordable public housing will inevitably improve retirement adequacy.”

Making housing more accessible and affordable

Pritam raised concerns about the higher CPF grants for resale flat buyers, questioning the government’s thinking behind the move as the grants may “feed into higher prices” and only make “a future correction every sharper”.

He said that flat prices could rise as buyers may bid more for a flat they want because they know the higher grant can enhance the price they can pay.

Pritam called on Wong to share more details on the differences between the valuation of land for public and private use, asking the government to release the figures of land prices for specific housing projects and associated subsidies on a BTO project basis.

Concluding his speech, Pritam said that the Worker’s Party supports the 2023 Budget Statement.

Top photo via MCI’s YouTube